Turkiye Sinai Kalkinma Bankasi A.s. · BIST:TSKB
Turkiye Sinai Kalkinma Bankasi A.s — Türkiye Sınai Kalkınma Bankası A.Ş. (TSKB) — Q2 2024 Earnings Presentation
33 slides from Turkiye Sinai Kalkinma Bankasi A.s's earnings presentation, 2024
Slide 1: Corporate Banking Investment Banking Advisory Services
Corporate Banking Investment Banking Advisory Services
Slide 2: TSKB at a Glance
TSKB at a Glance 4 Turkey als Bank Group 40.2% yyy yy cage Lyle oe Shareholding baae Z fakifban! Structure WM Fitch LTFC B B+ Free Float* & Other Moody’sLTIR BI B1 SAHA Corporate 0.66/10 Governance Rating YY Sustainalytics ESG 6.9 Negligible Risk As of July 31° 2024 Risk Rating yyy CORPORATE BANKING
Slide 3: A Unique Business Model
A Unique Business Model = Long term tenor in liabilities: 11 years * Medium term in assets: 47 years = Diversified funding tools = Amortized loan book = Multi-disciplinary assessment during allocation = Sector specific research analysts during allocation and monitoring period = Strong collateralizat
Slide 4: Main Stakeholders of the Bank
Main Stakeholders of the Bank A trustworthy partner in; Large Corporates, MidCap Companies & SME's Its field experience Cooperation in various areas such as; corporate loans, investment banking activities and advisory services Ministry of Treasury and Finance Its capacity to introduce innovative the
Slide 5: Sustainability is Well Integrated into Our Business Model
Sustainability is Well Integrated into Our Business Model health and safety © Supporting less developed regions Support for employment in Turkey; ® Encouraging women participation to the economy ERB Support transition to low ye carbon economy © Providing financing to operational Environmental & Soci
Slide 6: TSKB Sustainability Journey
TSKB Sustainability Journey - | First Carbon Neutral Bank of Turkey Environmental Factor in YH ty Credit Appraisal Process Environmental Management * — GRI Approved Sustainability Report System + CDP | + UNGlobal Compact Commitment 1980 1990 2005 2007 2008 2009 2010 2011 First Environmental Loans |
Slide 7: • • • • • • • • • • • • • •
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Slide 8: Sustainable Banking Developments
Sustainable Banking Developments = idfc estoy IDFC Steering Group meeting hosted by TSKB in Istanbul ©O AFD 20 years in Turkiye Awards Women and Men Equality Promoter TSKB #1 for gender equality in 2024 AEQUILEAP First place in Emerging Markets Gender Equality Index Y Reporting x Integrated Annual R
Slide 9: Superior 2Q-24 Performance at a Glance
Superior 2Q-24 Performance at a Glance + Best-in-class ROE Outstanding Profitabi +FX Loan Spread 28% QoQ 39% YoY earnings growth *Core NIM expansion + Diversified fee income performance *New DFI agreements and syndication loan with %156 roll-over ratio + USD 1,1 bn Unwithdrawn DFI funding *FX LCR: 3
Slide 10: Financial Guidance (Bank Only)
Financial Guidance 1H-24 Figures Previous YE24 Guidance Revised YE24 Guidance (Bank Only) % % % Growth FX Adjusted Loan Growth 6.7 High Single Digit Low Teens Profitability Net Interest Margin 5.9 ~6 - Fees & Commissions Growth 115 > avg. CPI - Return On Equity 37.1 ~40 - Efficiency OPEX Growth 88 >
Slide 11: Differentiating Continuous Profitability
Differentiating Continuous Profitability Net Profit-TL mn Yearly Quarterly © Strong coverage and free provision reserves to support profitability 1H-23 1H-24 10-24 20-24 Y Total coverage ratio stands at 5.9% DO ¥ — Stock of free 34.7% 37.1% Ay} 2023 10-24 1H-24 TSKB
Slide 12: Banking Sector vs TSKB
AP Banking Sector vs TSKB CAR* 24.1% 17.1% Banking Sector TSKB *Reported figures Cost to Income 427% 15.6% Banking Sector TSKB Repo « 6%) Syndication ge 2 Borrowed gy 8% al Deposit rc] 03% Securities Issued 2 3% 3 Equit Subordinated bonds 3 EM Other) ] 2nd loans (ATI +Tier It) 7% 2% Loans/Assets Tot
Slide 13: Supported by new engagements, funds secured in 2024 reach USD 1.1 billion
Supported by new engagements, funds secured in 2024 reach USD 1.1 billion Funding / Total Liabilities (exc. Equity & Oth.) 3% 22% 22% 22% 11% 11% 10% ’ 4Q-23 10-24 20-24 Ales m Guaranteed DFI Funding Unguaranteed DF Securities Issued = Subordinated Debt mRepo & Money Market Syndication & Other ~80%
Slide 14: Long Term DFI Funding Base
IBRD AIIB Kfw JBIC AFD CDB IFC IsDB EBRD OEB CEB 14 Long Term DFI Funding Base Outstanding DFI Funding Base - 20-24 2.0% 1.0% 0.7% Yearly Multilateral Funding Agreements - USD mn 2018 2019 2020 2021 2022 2023 1H2024
Slide 15: Outstanding Project Themes Shaping Future Loan Book
VS Outstanding Project Themes Shaping Future Loan Book Energy and Resource Efficiency Women’s Employment and Equal Opportunity Renewable Energy Midcap Financing Supporting Exporters Regional Development Supporting Employment Sustainable Agriculture Industrial Development Sustainable Tourism Occupati
Slide 16: Resilient Asset Composition
16 Resilient Asset Composition Asset Composition - TL bn 4Q-23 10-24 20-24 mLoans ™ Securities = Cash &MM mNon IEAs & Other Loans by Currency TL; 7.8% Ne USD; 50.6% EUR; 41.6% Total Loans - TLbn Loan Growth Currency 151.2 Breakdown YtD 144.4 Q0a - Ff >" oo ws ) oo 4Q-23 10-24 2Q-24 = FX Loans ($) eT
Slide 17: Risk Management Pillars
Risk Management Pillars Credit Risk * Monitoring the clients individually with analysing the financials * Preparing monitoring reports for the clients at least once a year * Keeping track of internal and external (if it is done) ratings of the customers, reviewing the internal ratings annually * Act
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Slide 19: Loan Breakdown by Sector
Electricity Generation 33.9% Finance 9.3% Metal & Machinery 8.8% Tourism 6.9% Logistics 5.5% Health & Education 5.4% Construction & Construction Materials 4.7% Electricity/Gas Distr. 4.6% Chemistry & Plastics 4.6% Textile 3.7% Food & Beverage 2.8% Paper and Forestry Products 2.1% Other** 7
Slide 20: Electricity Generation Loans by Source
1.9 bn 1.9 bn 1.9 bn 1.9 bn 1.7 bn 1.6 bn 1.6 bn 6% 6% 7% 8% 11% 5% 5% 6% 15% 19% 9% 11% 12% 10% 37% 35% 37% 39% 36% 37% 37% 18% 19% 20% 19% 19% 19% 19% 35% 35% 31% 24% 23% 17% 15% 2018 2019 2020 2021 2022 2023 1H-24 Hydro Geothermal Wind Biomass Solar • •
Slide 21: ✓ ✓ ✓ ✓ ✓ 134,263 1,153 12,846 4,321 4,081 3,391
✓ ✓ ✓ ✓ ✓ 134,263 1,153 12,846 4,321 4,081 3,391
Slide 22: Security Yields
Security Yields Excluding CPI CPI 80.4% 75.6% 58.6% 57.7% 56.9% 43.1% • 47.8% 47.5% 42.8% 42.6% 31.5% • 22.6% 41.5% 17.3% 18.8% 19.1% 18.9% 19.4% 19.9% 42.2% 1Q-22 2Q-22 3Q-22 4Q-22 1Q-23 2Q-23 3Q-23 4Q-23 1Q-24 2Q-24
Slide 23: Income Statement Highlights
Income Statement Highlights TLmn Net Interest Income Trading Income Net Fees & Commissions Other Income (Inc. Dividend) Banking Income OPEX (-) Net Banking Income Provisions (-) Income From Participations Tax Provisions (-) Net Profit Based on MIS data 1H-23 3,932 1,638 137 121 5,827 536 5,291 1,882
Slide 24: Sustainable and Resilient NIM
Sustainable and Resilient NIM Net Interest Income inc. Swap Cost (TL bn) 3,046 2,541 2,760 874 =CPI Income =I excl. CPI 2,873 Swap Cost (1,223) (987) 40-23 1Q-24 20-24 v Strong and resilient NII generation ¥ 9% qoq surge in NIl inc. swap costs 24 Annualized NIM 7.0% 2.4% SLY yoy Ly 1.8% 1.9% =CPI Im
Slide 25: Further strengthened solvency metrics support our growth plans
Further strengthened solvency metrics support our growth plans Capital Ratios Without BRSA Temporary Measures LAA 19.5% 17.4% 18.4% 2023 10-24 mTier | Ratio CAR Reported Figures- CAR: 24.1% | Tier :23.0% | CET: 16.6% 25.0 Free Provision Adjusted CAR: 21.3% Tier I: 20.1% 20.0 15.0 10.0 25 10-24 20.3%
Slide 26: 2S BS Q gf x
2S BS Q gf x
Slide 27: Balance Sheet
27 Balance Sheet Cash and Banks Securities Loans (Gross) Provisions Subsidiaries Other Total ST Funds LT Funds Securities Issued Repo & MM Other Subordinated Debt Shareholders Equity 12,802 37,399 151,189 -8,893 9,151 5,535, 207,185 6,146 104,716 37,464 14,254 8,006 10,073 26,526 TLmn 31.12.2023 31.
Slide 28: Detailed Income Statement
28 Detailed Income Statement TLmn 1H-23 1H-24 YoY 1Q-24 2Q-24 QoQ Net Interest Incomeinc, Swap Cost 3,932 5,302 35% 2,541 2,760 9% Net Interest Income 3,830 7,512 96% 3,764 3,747 0% CPI Linkers 1,388 1,712 23% 837 874 4% Swap Costs 102 2,210. -2267% -1,223 -987 -19% Net Commissions 137 294 115% 130
Slide 29: Appendix: ESG Ratings
Appendix: ESG Ratings () sustamatynics Wepp Sustainalytics ESG Risk Rating CDP Climate Change Score Range 0-40+ A/D- Score 6.9 A- Negligible risk category Leadership First place in Turkiye 9th place among global development banks GLOBAL 50 TOP RATED | Pas Moopy’s Moody's ESG Credit Impact Score a5 2
Slide 30: Appendix: Stage Loans Breakdown
30 Appendix: Stage 2 Loans Breakdown Stage 2 Loans Sector % Coverage (%) Tourism 45 4l Electricity/Gas Distribution 19 41 Electricity Generation 15 14 Non-residential Real Estate 8 29 Metal and Machinery 6 31 Telecom/Logistics 4 10 Automotive Supply Industry 3 20 TOTAL 100 34 * Hard collateral & pro
Slide 31: Appendix: IEA Evolution
31 Appendix: IEA Evolution Interest Earning Assets (TL bn) 183 189 ; ; 4Q-23 10-24 20-24 mLiquid Assets mSecurities =Loans v Interest Earning Assets were up by 3% QoQ and 37% YoY, which was driven by * High FX denomination * Growth strategy
Slide 32: Provisions
Provisions (TL mn) 2Q24 Stage 1* 41 Stage 2** 314 Stage 3 296 Reversals*** (TL mn) -58 Net CoR 84 bps Currency Impact 57 bps Net CoR excl. Currency Impact 27 bps
Slide 33: Disclaimer
DISCLAIMER This presentation document is prepared for informational purposes only and contains certain forward-looking comments, opinions, and forecasts. These reflect the views of Turkiye Sinai Kalkinma Bankasi A‘S. ("TSKB") as of the date of this presentation and contain certain assumptions. Altho
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