Turkiye Halk Bankasi Anonim Sirketi · BIST:HALKB

Turkiye Halk Bankasi Anonim Sirketi — Türkiye Halk Bankası A.Ş. — FY2017 Earnings Presentation

32 slides from Turkiye Halk Bankasi Anonim Sirketi's earnings presentation, 2018

  1. Slide 1: 2017 Earnings Presentation

    2017 Earnings Presentation DISTINGUIS H ED PROFIT A BLE RESI L IENT RIS K CONSCIOUS RELIA B LE SUST A INABLE NATIO N WIDE MAR K ETMAKER BRSA Bank Only

  2. Slide 2: Slide 2

  3. Slide 3: 2017 Highlights

    2017 Earnings Presentation 2017 Highlights Net Income Growth RoE CoR (a) LDR (b) OpEx/Avg. Assets Solid Financial Results & & 46% & 16% 62 bps 105% & 1.7% Net Income (TRY mn) Net Income Evolution 2016 - 2017 (TRY mn) 2,027 46% 1,375 7,836 3,725 7,106 2,558 (4,553) 868 840 3,725 (3,864) 2,558 (1,469)

  4. Slide 4: 2017 Highlights

    2017 Earnings Presentation 2017 Highlights Main Pillars of Net Income Growth 1 Strong Topline 2 Fees & Commissions Generation Capacity YoY NII Growth +12% Interest income on Loans +33% As of Dec-17 Sector* vs Interest income on Securities +46% +47% YoY +20% YoY Total Interest Income +36% 3 Sustained

  5. Slide 5: Macro & Banking Sector Snapshot

    2017 Earnings Presentation Macro & Banking Sector Snapshot Domestic Macro Environment Real GDP Growth (%) CAD / GDP (%) Brent (USD / Mon Avg) CAD/GDP (%-RHS) 11.1 11.1 20 -2.00 25 -2.50 8.5 30 6.1 -3.00 5.2 5.3 5.4 35 4.8 4.8 4.9 4.2 40 -3.50 -3.8 3.2 45 -4.00 50 -4.50 55 55 -5.2 -5.00 60 (0.8) 63 6

  6. Slide 6: Macro & Banking Sector Snapshot

    2017 Earnings Presentation Macro & Banking Sector Snapshot Domestic Macro Environment Turkish Banking Sector Unemployment & Confidence Indices 2017 vs 2016 in Terms of Selected Items (%) Consumer CI Unemployment (%-RHS) Real Sector CI Total Assets 19.3 140 0 Total Loans 21.0 120 2 TRY Loans 25.0 110

  7. Slide 7: Cumulative net income soared by 46% YoY, yielding into 16% RoE

    2017 Earnings Presentation Cumulative net income soared by 46% YoY, yielding into 16% RoE Net Income (TRY million) 97.2% 45.6% -8.5% 3,725 YoY Change (%) 1,219 1,009 12.1% Net Interest Income 782 2,558 47.4% Net Fees & Commissions 715 15.6% Total Operating Income 363 45.6% Net Income Q4-16 Q1-17 Q2-

  8. Slide 8: Strong growth in total assets by 32%

    2017 Earnings Presentation Strong growth in total assets by 32% TRY 10 bn. worth of securities have been borrowed pursuant to a reciprocal agreement. Despite being booked under trading securities, this portfolio generates neither interest income nor gain/loss from MtM revaluation into the P&L. Asset

  9. Slide 9: Solid contribution from CPI-linkers

    2017 Earnings Presentation Solid contribution from CPI-linkers Total Securities Portfolio (TRY billion) Interest Structure (%) Total Securities / Total Assets (%) 16.0 (a) 14.9 14.4 13.7 CPI-Linked (TRY 11.7bn) 38.2 38.9 (b) 30% 33.2 8.1 21% 27.9 7.9 21% Fixed Rate 6.6 20% FX 5.8 21% 55.7% TRY 22.1

  10. Slide 10: SME and retail driven loan growth, 29%

    2017 Earnings Presentation SME and retail driven loan growth, 29% CGF Utilization (TRY Bn) Jun-17 Sep-17 Dec-17 Total Limit 16.6 22.3 22.3 (TRY billion)(a) 28.5% Loan Origination 12.5 20.9 21.6 Total Loans 4.9% HALKBANK B. Sector(b) 199.2 YoY YoY 189.9 0,1 Commercial Loans 28.5% 21.0% 0,1 16.2 YoY 1

  11. Slide 11: SME focused, TRY heavy loan book

    2017 Earnings Presentation SME focused, TRY heavy loan book Loans by Currency (%)(a) Loans by Customer Segmentation (%)(a) SME 5.2% Commercial 1.7% SME 38% Commercial 8% Corporate 24.6% Corporate 33% Cooperative 12%(b) TRY FX 68.4% 31.6% Retail 21% Sectoral Breakdown of Loans (%)(a) Retail Loans by

  12. Slide 12: Increased market share across all segments within retail lending YoY

    2017 Earnings Presentation Increased market share across all segments within retail lending YoY (TRY billion)(a) 29.2% HALKBANK YoY 1.4% 29.2% QoQ 40.7 41.3 1.4% 31.9 Consumer Loans 17.0 17.0 YoY 23.7% B. Sector(b) 27.6 QoQ 0.2% 13.8 Share in total 41.3% YoY 16.3% 12.1 Housing Loans QoQ 20.5 20.9 Yo

  13. Slide 13: NPL ratio continues to decrease, NPL coverage up

    2017 Earnings Presentation NPL ratio continues to decrease, NPL coverage up NPL Portfolio (TRY million) NPL Coverage (%) 5,944 6,107 78.3 5,140 77.1 3,974 76.2 76.1 2015 2016 Sep-17 2017 2015 2016 Sep-17 2017 Loans under Close Watch (TRY million) NPL/Total Loans (%) Loans under Close Watch/Net Loans

  14. Slide 14: NPL ratio by segments

    2017 Earnings Presentation NPL ratio by segments Halkbank NPL Sector NPL (a) Corporate - Commercial (%) Consumer Loans (%) 6.2 6.0 5.0 4.8 3.6 3.5 3.4 3.3 2.5 2.4 2.0 1.9 2.1 2.1 1.9 1.9 Sep-16 2016 Sep-17 2017 Sep-16 2016 Sep-17 2017 SME Loans (%) Credit Cards (%) 10.0 10.0 9.6 9.6 8.3 8.0 4.7 4.9

  15. Slide 15: CoR resistant at 62 bps

    2017 Earnings Presentation CoR resistant at 62 bps Cost of Risk (bps)(a) Cost of Risk by Segments (bps)(a) YtD Quarterly 142 123 92 66 70 62 68 53 81 92 59 47 62 50 41 2016 Mar-17 Jun-17 Sep-17 2017 SME Retail Commercial Corporate Total Net Cost of Risk Gross Cost of Risk (bps) (Specific Provisions-

  16. Slide 16: Comfortably low share of non-deposit ST FX vs. sector average

    2017 Earnings Presentation Comfortably low share of non-deposit ST FX vs. sector average IBL 84.0%(a) Loan to Deposit (%) Composition of IBLs(a) Liabilities Mix (%) (b) Halkbank L/D Sector L/D Deposits Marketable 85.2% 86.3% 87.2% 84.0% Funds Borrowed Securities Issued Interbank Money Market Shareho

  17. Slide 17: Further strengthening of deposit base

    2017 Earnings Presentation Further strengthening of deposit base HALKBANK B. Sector(b) YoY 19.3% 24.3% HALKBANK B. Sector(b) HALKBANK B. Sector(b) QoQ -7.6% 5.5% in USD YoY 10.5% 15.1% YoY 28.4% 17.7% YoY 34.7% 12.9% terms QoQ -14.2% -2.0% QoQ 3.9% 4.6% QoQ 12.7% 3.9% Total Deposits TRY Deposits FX

  18. Slide 18: Cost of TRY deposits rising but losing momentum

    2017 Earnings Presentation Cost of TRY deposits rising but losing momentum Demand Deposits (TRY billion)(a) Time Deposits (TRY billion)(a) Deposits by Currency (%) Demand Deposits/Total Deposits (%) Time Deposits/Total Deposits (%) 16.7% 84.8% 85.8% 16.2% 83.8% 83.3% 15.2% 14.2% FX 38% 41.1% 65.2% 1

  19. Slide 19: Cost – Yield – Spread

    2017 Earnings Presentation Cost – Yield – Spread (a) Cost of Deposits (%) Spreads (%) On Loans On Securities 7.2 6.9 6.6 6.2 5.8 5.4 4.8 4.8 4.2 4.0 3.9 4.2 2.9 2.5 0.3 Q4-16 Q1-17 Q2-17 Q3-17 Q4-17 Q4-16 Q1-17 Q2-17 Q3-17 Q4-17 Yield on Loans (%)(b) Yield on Securities (%) 11.2 12.1 10.6 10.8 10.4

  20. Slide 20: Quarterly NIM improved by ~70 bps

    8 -6.36 3 2017 Earnings Presentation Quarterly NIM improved by ~70 bps Net Interest Income (TRY million) Breakdown of Interest Income (%) Interest Income Interest Expenses 3.0% 12.1% 31.2% 16% on Securities 2,282 7,801 1,978 1,928 6,957 2% on Others 1,553 2,038 4,647 5,171 5.402 5.777 6,744 16,954 2

  21. Slide 21: NFCI speaks for itself: 47.4% increase YoY

    2017 Earnings Presentation NFCI speaks for itself: 47.4% increase YoY Net Fees & Commissions Income (TRY million) 12.9% 47.4% -8.8% 2,027 537 509 513 468 415 1,375 Q4-16 Q1-17 Q2-17 Q3-17 Q4-17 2016 2017 Breakdown of Fees & Commissions (%) Net Fees & Commissions / Operating Revenues (%) Asset Manage

  22. Slide 22: Opex/Average Assets further improved to 1.7%

    2017 Earnings Presentation Opex/Average Assets further improved to 1.7% Operating Expenses (TRY million) Operating Expenses / Average Assets (%) 17.8% (13.8% adj.)(b) 9.9% 4,553 1,267 3,864 20 (a) 2.0 1,113 1,152 1.8 1.7 1,063 1,021 3 (a) 89 4 9 6 6 Q4-16 Q1-17 Q2-17 Q3-17 Q4-17 2016 2017 2015 2016

  23. Slide 23: Solvency Ratios

    2017 Earnings Presentation > (a) TRY 1 bn. Local Currency Subordinated Tier II issuance Solvency Ratios was completed in Oct-17, positive impact on CAR is ~50 bps. CAR (%) Details on Capital Ratio Tier-I CAR Basel III 13.1 13.6 14.0 13.8 14.2 (TRY mn) 2017 Credit Risk Base Amount (CRBA) 184,837 13.0

  24. Slide 24: Branch Network – Human Resources

    2017 Earnings Presentation Branch Network – Human Resources > 4 new branches opened in 2017. > Total branch number reached 963 Loans and Deposits per Branch (TRY million) Breakdown of Banking Transactions (%) Loans/Branch Deposits/Branch Internet Automatic Banking 11% Payment 4% 211.3 201.6 ATM 24%

  25. Slide 25: Balance Sheet

    2017 Earnings Presentation Balance Sheet QoQ YoY In TRY million 2016 Sep-17 2017 Change% Change% Cash and Balances Held with the Central Bank(a) 29,999 34,559 36,373 5.3 21.2 Banks & Money Market(b) 1,661 3,985 7,353 84.5 342.7 Securities(b) 33,216 38,195 48,903 28.0 47.2 Net Loans(b) 158,354 194,17

  26. Slide 26: Income Statement

    2017 Earnings Presentation Income Statement QoQ YoY YoY Change Change In TRY million 2016 2017 % Q4-16 Q1-17 Q2-17 Q3-17 Q4-17 % % Interest Income 16,954 23,094 36.2 4,647 5,171 5,402 5,777 6,744 16.7 45.1 On Loans 14,256 18.960 33.0 3,937 4,064 4,375 4,984 5,537 11.1 40.6 On Securities 2,539 3,703

  27. Slide 27: Halkbank 2018 Expectations

    2017 Earnings Presentation Halkbank 2018 Expectations Growth Expectations (%) Key Ratios (%) Macro Expectations (%) 2018 2018 2018 Assets 16 RoE 15-16 GDP Growth ~5.5 Loans 17 RoA ~1.3 Headline CPI ~9.0 TRY 22 Loan / Deposit <103 CAD / GDP <5 FX (USD) 3 NIM Flat Budget Deficit / GDP ~1.9 Corporate 8

  28. Slide 28: Notes

    2017 Earnings Presentation Notes Financial Institutions and Investor Relations 26 www.halkbank.com.tr

  29. Slide 29: Notes

    2017 Earnings Presentation Notes Financial Institutions and Investor Relations 27 www.halkbank.com.tr

  30. Slide 30: Notes

    2017 Earnings Presentation Notes Financial Institutions and Investor Relations 28 www.halkbank.com.tr

  31. Slide 31: Slide 31

  32. Slide 32: For further information please contact

    For further information please contact halkbank.IR@halkbank.com.tr DISCLAIMER The information contained in this presentation has been prepared by Türkiye Halk Bankası A.S. (the Bank) for informational purposes only. Although the information in this presentation has been obtained from sources which t

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