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1H15 Earnings Release

Accelerating performance, disciplined approach

On 30 July 2015, Yapı Kredi announced its consolidated 1H15 results based on Turkish accounting standards (BRSA), reporting TL 956 million net income, indicating 3% y/y growth and 9.7% return on average tangible equity.


“Solid commercial performance”

Yapı Kredi’s total revenues increased by 22% y/y in 1H15 to 4,974 million supported by 18% y/y growth in both fees and net interest income as well as contribution of other income. Quarterly NIM increased by 50 bps q/q up to 3.6% supported by CPI-linker contribution as well as 20 bps expansion in loan-deposit spread thanks to upward loan repricing and contained deposit costs. In the same period, cost growth was 23% y/y which incorporates the growth investments. Thanks to the decelerating pace of costs accompanied by solid core revenue performance, quarterly cost/income ratio improved from 49% to 48% with further normalization expected in 2H15.


“Continuing growth and remix of the loan book”

Yapı Kredi continued its growth strategy with a balanced approach in 1H15. Total loan book reached TL 142.8 billion with above sector growth of 14% ytd while 2Q growth was in line with sector. Hence, YKB’s market share in total loans increased by 12bps ytd to 10.4%.Effective loan book remix continued in 2Q15 with faster growth in value generating areas including general purpose loans (+19% ytd vs 4% sector), SME loans (+18% ytd vs 9% sector) and mortgages (+12% ytd vs 11% sector).  The Bank maintained its long-running leadership in credit cards. During the same period, total deposit book reached TL 126.1 billion with 17% ytd growth (vs 13% sector) corresponding to a market share of 10.4%. Accordingly, bank-only loan to deposit+TL bonds ratio decreased ytd to 110% compared to sector level of 117%. Diversification of the funding base also continued and on April 30th, YKB signed a 1 year ~US Dollar 1.4 bln syndication loan agreement raised through 48 banks from 15 countries with a 114% roll-over ratio.


“Growth investments and digital approach on track”

The Bank is continuing its strong focus on digitalization in order to increase customer satisfaction and decrease cost to serve. In mobile and internet banking, Yapı Kredi has solid market positioning with 11.6% and 13.1% market share, respectively. At the same time, branches remain an important touch point for customers. Accordingly, the Bank also enhanced its physical network with 10 new branches (up to 1,013 branches), 419 new ATMs (up to 4,025 ATMs) and 1,011 new employees (up to 19,545). Supported by these initiatives, Yapı Kredi increased its number of active customersby 358 thousand in the first half of 2015to 10.9 million, while total number of customers reached21 million.


“Effectively managed capital base and resilient fundamentals”

Despite ongoing growth and volatile operating environment, capital adequacy ratio was kept at comfortable levels. Accordingly, as of 1H15 the Bank’s capital adequacy ratio realized at 14.0% while Tier-1 ratio increased by 10 bps compared to 1Q15 up to 10.5% thanks to optimisation efforts.


“Assets quality evolution in line with annual guidance”

In terms of asset quality, NPL ratio increased by 6 bps to 3.6% vs 1Q15 impacted by volatile operating environment and remains more resilient versus the evolution at private banks (+8 bps q/q). Cost of risk was recorded as 1.45% reflecting a bulk booking of general provisions for credit card regulation.


Istanbul, 30 July 2015

Inquiries:Yapı Kredi Investor Relations

Tel: (90) (212) 339 6770

Email: yapikredi_investorrelations@yapikredi.com.tr

Yapı Kredi / 30 Jul 2015