Turkiye Halk Bankasi Anonim Sirketi · BIST:HALKB

Turkiye Halk Bankasi Anonim Sirketi — Türkiye Halk Bankası A.S. — FY2018 Earnings Presentation

26 slides from Turkiye Halk Bankasi Anonim Sirketi's earnings presentation, 2019

  1. Slide 1: 2018 Earnings Presentation

    2018 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: Presentation Outline

    2018 Earnings Presentation Presentation Outline > Highlights From A Macro Perspective - Lending Activity - Liquidity - Solvency > Quarterly Review -BS Details -Funding Base -P&L Items >Appendix Financial Institutions and Investor Relations 1 www.halkbank.com.tr

  3. Slide 3: Best Positioned Bank for the New Economy Programme

    2018 Earnings Presentation Best Positioned Bank for the New Economy Programme Transformation and Re-balancing to benefit SMEs Exchange rate adjusted loan growth (QoQ) Domestic Exports -33% +11% -17% +7% -4% +78% +12% Annual % changes by the end of 2018 Sources: Ministry of Treasury and Finance, Mini

  4. Slide 4: Opportunistic Diversification of Loan Portfolio

    2018 Earnings Presentation Opportunistic Diversification of Loan Portfolio Loans by Currency (%)(a) Loans by Customer Segmentation (%)(a) SME 5.2% Commercial 6% Commercial 1.3% Corporate 37% SME 39% Corporate 27.4% TRY 66.1% FX 33.9% Retail 18% Cooperative 13%(b) Sectoral Breakdown of Loans (%)(a) R

  5. Slide 5: Pre-Cautionary Approach in Lending Provides Safety Net

    2018 Earnings Presentation Pre-Cautinary Approach in Lending Provides Safety Net Total NPL Coverage is ~109%.(a) NPL Portfolio(*) (TRY million) NPL Coverage(*) (%) 8,159 79.5 79.9 78.7 78.3 77.0 7,175 6,522 6,107 6,265 2017 Mar-18 Jun-18 Sep-18 2018 2017 Mar-18 Jun-18 Sep-18 2018 Loans under Close W

  6. Slide 6: NPL ratio by segments

    2018 Earnings Presentation NPL ratio by segments Halkbank NPL Sector NPL (a) Corporate - Commercial (%) Consumer Loans (%) 4.8 4.7 4.7 4.9 4.5 3.3 2.8 2.7 2.7 2.5 2.7 2.3 1.9 1.9 2.1 2.6 2.1 2.2 2.1 2.2 2017 Mar-18 Jun-18 Sep-18 2018 2017 Mar-18 Jun-18 Sep-18 2018 SME Loans (%) Credit Cards (%) 9.6

  7. Slide 7: Durability Arising From Low Risk Profile

    2018 Earnings Presentation Durability Arising From Low Risk Profile Cost of Risk (bps)(a) Net Cost of Risk (bps) YtD Quarterly General Provisions S1 Provisions S2 Provisions S3 Provisions 115 Provision Reversals 134 18 80 80 83 65 39 6 39 68 13 34 83 19 55 53 4 115 64 68 83 63 54 54 53 53 (17) (12)

  8. Slide 8: Better Liquidity Conditions Ripe for Prudent Growth

    2018 Earnings Presentation Better Liquidity Conditions Ripe for Prudent Growth Blue Dots Implied Year End Rate - 2020 3M Deposit Rates Central Bank OMO Funding (TRY bn) Blue Dots Implied Year End Rate - 2019 30% 180 Fed Funds Rate 16 4% 25% 140 20% 120 3% 15% 80 2% 60 10% 40 1% 5% 20 0% 0% 0 21/09/2

  9. Slide 9: Improving Risk Sentiment Ensures Capital Buffers

    2018 Earnings Presentation Improving Risk Sentiment Ensures Capital Buffers CDS Commercial Loan - Deposit Rate Spread 505 12 455 10 405 355 8 305 6 255 205 4 155 2 105 55 0 2014 2015 2016 2017 2018 2019 As of 31 January 2019 Source: Bloomberg, Central Bank of Republic of Turkey, HalkBank Economic Re

  10. Slide 10: Room for Raising Capital Strengthens Solvency Ratios

    2018 Earnings Presentation Room for Raising Capital Strengthens Solvency Ratios LC Subordinated TRY 1.95 bn, Jul-18 Positive Impact Tier II Issuances; TRY 2.98 bn, Sep-18 on CAR: 1.74 ppt CAR (%) Details on Capital Ratio Tier-I CAR Basel III 14.9 13.8 14.2 13.4 13.2 (TRY mn) Dec-18 Credit Risk Base

  11. Slide 11: Adaptive Balance Sheet Management

    2018 Earnings Presentation Adaptive Balance Sheet Management Asset Mix (%) Asset Growth Loans Securities(a) Bank Placements CBRT Receivables Cash YoY 23.9% QoQ -2.3% Liq. Assets Other Assets Total Asset Growth (TRY billion) 63.5% 66.2% 77.4% 8.8% 23.9% 378.4 13.8% 19.7% 305.4 3.5% 10.6% ) ets (% . A

  12. Slide 12: Fulfilling Prime Dealer Responsibilities Treasury Management

    2018 Earnings Presentation Fulfilling Prime Dealer Responsibilities Treasury Management Yielded in Positive Returns Total Securities Portfolio (TRY billion)(a) Securities Classification (TRY billion) Total Securities / Total Assets (%) Other Floating Rate CPI Linkers Fixed Rate (TRY) Fixed Rate (FX)

  13. Slide 13: Gaining Market Share Withstanding Challenges

    2018 Earnings Presentation Gaining Market Share Withstanding Challenges CGF Utilization (TRY Bn) Total Limit Sep-18 29.3 Dec-18 29.8 (TRY billion)(a) Living Loan Amount 24.4 22.2 23.7% Total Loans -4.8% HALKBANK B. Sector(b) The definition of YoY YoY 23.7% 14.1% SMEs has been 258.9 QoQ QoQ 14.3 246.

  14. Slide 14: Deposit Heavy Funding Structure Renders Immunity to Wholesale Market

    2018 Earnings Presentation Deposit Heavy Funding Structure Renders Immunity to WholeSale Market Composition of IBLs(a) Liabilities Mix (%) Deposits Marketable 87.2% 84.0% 84.8% 85.6% Funds Borrowed Securities Issued Interbank Money Market Shareholders’ Equity Other Liabilities FX 40.9% 41.3% 43.7% 4

  15. Slide 15: Relying on Deposits Resulted in Gaining Market Share

    8 -6.36 3 2018 Earnings Presentation Relying on Deposits Resulted in Gaining Market Share HALKBANK B. Sector(b) YoY 47.0% 30.5% HALKBANK B. Sector(b) HALKBANK B. Sector(b) QoQ 5.1% -10.3% YoY 28.5% 19.6% YoY 17.0% 10.5% in USD YoY 5.7% -6.1% QoQ 4.1% -5.1% QoQ 3.3% 0.6% terms QoQ 19.7% 2.1% Total De

  16. Slide 16: Customer Loyalty Underpins Granular Deposit Base

    2018 Earnings Presentation Customer Loyalty Underpins Granular Deposit Base Demand Deposits (TRY billion)(a) Time Deposits (TRY billion)(a) Deposits by Currency (%) Demand Deposits/Total Deposits (%) Time Deposits/Total Deposits (%) 15.5% 16.3% 85.8% 84.5% 83.7% 85.3% 14.2% 14.7% FX 44% 29.6% 24.1%

  17. Slide 17: Cost – Yield – Spread Supported by Security Portfolio

    2018 Earnings Presentation Cost – Yield – Spread (a) Supported by Security Portfolio Cost of Deposits (%) Spreads (%) On Loans On Securities 11.6 9.3 4.1 4.5 7.7 7.8 4.0 3.7 3.6 7.2 2.1 2.9 2.0 1.0 1.2 Q4-17 Q1-18 Q2-18 Q3-18 Q4-18 Q4-17 Q1-18 Q2-18 Q3-18 Q4-18 Yield on Loans (%)(b) Yield on Securit

  18. Slide 18: Securing Financial Access: A Short Term Pain For The Long Term Gain

    2018 Earnings Presentation Securing Financial Access: A Short Term Pain For The Long Term Gain Total Operating Revenues (TRY million) Net Income (TRY million) 3.2% 16.9% -32.3% 1,113 10,464 10,803 2,654 2,812 2,877 3,725 2,644 2,461 2,522 790 715 303 317 2017 2018 Q4-17 Q1-18 Q2-18 Q3-18 Q4-18 2017

  19. Slide 19: Details on Major Revenue Items

    2018 Earnings Presentation Details on Major Revenue Items Net Interest Income (TRY million) NIM (%) Interest Income Interest Expenses YtD Quarterly 3.6% -2.5% 8,080 2,002 1,953 3.6 1,969 2,155 7,801 2,038 3.1 3.2 3.4 2.9 2.8 23,094 36,671 6,744 6,926 7,879 10,072 11,793 3.1 3.1 (15,293) (4,707) (4,9

  20. Slide 20: OPEX Dynamics

    2018 Earnings Presentation OPEX Dynamics Operating Expenses (TRY million) Operating Expenses / Average Assets (%) 23.0% 19.9% 1,609 1.8 1.7 5,460 1.5 1.6 1,267 1,345 1,308 52(a) 4,553 1,198 203 (a) 50 51 157 51 50 Q4-17 Q1-18 Q2-18 Q3-18 Q4-18 2017 2018 2016 2017 Sep-18 2018 Cost/Income (%) Breakdow

  21. Slide 21: Branch Network – Human Resources

    2018 Earnings Presentation Branch Network – Human Resources > 28 new branches opened in 2018. > Total branch number reached 988. Loans and Deposits per Branch (TRY million) Breakdown of Banking Transactions (%) Loans/Branch Deposits/Branch Internet Automatic Banking 14% Payment 5% 268.1 253.7 211.3

  22. Slide 22: Appendix

    2018 Earnings Presentation Appendix TRY Market Banking Halkbank Million Share (%) Sector Metrics(b) 2017 2018 Total Assets 378,422 9.8 Loan Growth (YoY, %) 21.0 23.3 Loans (a) 246,447 10.3 Deposit Growth (YoY, %) (c) 16.5 19.6 TRY Loans 162,876 11.3 LDR (%) 122.6 117.6 FC Loans 83,571 8.7 NPL (%) 3.

  23. Slide 23: Balance Sheet

    2018 Earnings Presentation Balance Sheet QoQ YoY In TRY million 2017 Sep-18 2018 Change % Change% Cash and Balances Held with the Central Bank(a) 36,373 29,802 34,957 17.3 (3.9) Banks & Money Market(b) 7,353 7,753 5,141 (33.7) (30.1) Securities(b) 48,903 73,315 74,557 1.7 52.5 Net Loans(b) 203,464 2

  24. Slide 24: Income Statement

    2018 Earnings Presentation Income Statement QoQ YoY Change Change In TRY million 2017 2018 YoY% Q4-17 Q1-18 Q2-18 Q3-18 Q4-18 % % Interest Income 23,094 36,671 58.8 6,744 6,926 7,879 10,072 11,793 17.1 74.9 On Loans 18,960 28,812 52.0 5,537 5,73 6,507 8,046 8,529 6.0 54.0 On Securities 3,703 7,045 9

  25. Slide 25: Notes

    2018 Earnings Presentation Notes Financial Institutions and Investor Relations 24 www.halkbank.com.tr

  26. Slide 26: 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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