2013 ANNUAL REPORT
TEB FINANCIAL SERVICES GROUP
TEB FACTORING
As one of the sector’s three biggest companies, TEB Factoring continued to serve corporate and commercial firms along with SMEs in 2013, and increased its business volume in 2013 through a range of various export, import and domestic factoring products.
TEB Factoring raised its business volume by 21% from TL 7 billion in 2012 to TL 8.5 billion in 2013. The company also expanded its total assets by 45%. The company’s net profit, on the other hand, declined by 10% in parallel with the falling interest rates in Turkey. Thus, the company generated a 26.41% return on equity and a 1.48% return on assets.
TEB Factoring boasts one of the highest productivity yields in the factoring sector.
TEB Factoring expanded its total client base to 17,193 in 2013. The company ended the year 2013 with 3,137 active customers, 15 branches and 124 employees.
TEB Factoring was awarded the “Best Export Factoring Company” for 4 years in a row between 2009 and 2012 by the members (a total of 272 members from 76 countries) of Factors Chain International (FCI), the world’s largest and the most important factoring organization. TEB Factoring also ranked second in the world, after the Bank of China, in terms of transaction volume in export factoring in 2013.
Considering the developments in business life in 2013, the loan insurance product – the availability of which is currently limited – is expected to be more widely available in the domestic market from 2014. Factoring companies which progress rapidly in this area will thus gain a product, thus shifting the leadership in the sector going forward. Having completed the necessary infrastructure of this product, TEB Factoring aims to raise its market share in the sector by performing guaranteed factoring transactions in the coming years. Another goal of TEB Factoring is to represent Turkey among the world’s leading countries in the factoring sector.
TEB ASSET MANAGEMENT
Managing a volume of nearly TL 3.5 billion, active in the fields of asset management and investment consultancy, TEB Asset Management is the 5th largest asset management company in the sector. TEB Asset Management’s fundamental objective is to determine the investment vehicle compositions of investment portfolios based on the risk profiles of individual and corporate clients and to manage those portfolios according to the optimum benefit.
As of December 2013, TEB Asset Management, as an asset management with a wide delivery channel abroad, commanded the following;
TEB Asset Management was chosen as ‘Turkey’s Best Asset Management Company in 2013’, by the World Finance publication was invited to join and became a member of the 20-20 Investment Association, which comprises of the world’s leading financial players, managing a total of US$8 trillion worth of assets.
Founded in 2000, TEB Asset Management has been providing asset management services since June 2004.
The company also began to offer ‘corporate asset management services’ by the end of 2005. Aiming to manage the assets of foundations, associations, corporations and legal entities, corporate asset management services are offered through TL and FX-based models under three different categories; bonds, absolute income and equities.
Having entered a mutually advantageous collaboration with its partner, BNP Paribas Asset Management – a leading name in the asset management business in the Eurozone – TEB Asset Management has tirelessly moved towards its goal of becoming a global player. Having already begun to see the benefits of this collaboration, TEB Asset Management had already succeeded in establishing strategic cooperation with a number of international corporations. In this context, road-shows conducted in Europe (such as in Italy, Germany, France and Finland) and in Eastern Asia (including Japan, Singapore and China) for international corporate investors have started to yield positive results.
TEB Asset Management took over the management of the Turkish Equity Mother Fund, which was established in Japan. The fund has grown to reach a volume of about € 310 million, succeeding in becoming the largest equity fund in Turkey to invest in Turkish equities. Moreover, TEB Asset Management took over the management of the Parvest Turkey Fund (€ 90 million), becoming Turkey’s largest asset management company in this category. The company also provides consultancy services to other foreign funds (€ 97 million), which invest in Turkish equities.
Attaching utmost importance to the development of products with an innovative approach
TEB Asset Management, as part of its innovative culture, founded the BRIC Fund, the Absolute Income Targeting Fund and the Tactical Distribution Fund, assuming a place among the leading asset management companies.
TEB Asset Management, in conjunction with Cardif Pension, the company’s strategic partner in pension funds, released 5 new theme funds under its management.
The primary new products which TEB Asset Management offered its investors in 2013 were the TEB Private Sector Bond-Bill Fund, the TEB Tactical Distribution Fund and the Absolute Income Targeting Fund, as well as 4 new Capital Protected Funds with different themes.
Success for TEB Asset Management in raising its market share in the mutual fund industry in 2013
TEB Asset Management succeeded in expanding the total volume of assets under its management by 33% in 2013 by correctly anticipating the difficulties arising in the sector and capital markets, diversifying its local products with the right timing, directing investors towards the right products at the right time and entering new strategic collaborations. This growth vastly outperformed the 15% average growth recorded by the sector in the same period.
Most of the primary mutual funds managed by TEB Asset Management yielded higher returns than their benchmarks. Likewise, the funds managed by TEB Asset Management – pension funds, and equity weighted funds in particular – command the highest rankings in terms of performance.
A harder year ahead for the capital markets and TEB Asset Management
This spring’s local elections, followed by the presidential election in the summer, and next year’s general election will raise political uncertainty, while the FED’s ongoing efforts to narrow the monetary expansion have given rise to expectations that demand for emerging market assets will decline. These two factors will negatively affect foreign investor demand in the Turkish capital markets.
Even under such challenging international conditions, TEB Asset Management will remain committed to protecting itself and its customers as well as its domestic and foreign shareholders against all possible negative risks arising in markets by carrying out the following:
TEB INVESTMENT
Established in 1996, TEB Investment’s primary field of activity is to engage in capital market operations in accordance with the provisions set forth in the Capital Markets Law and respective legislation.
TEB Investment Securities Inc. offers the following services:
TEB Investment’s vision is shaped around the following principles: to become the best and most trustworthy brokerage house in capital market activities; to expand its client portfolio by competing at the highest tier based on customer demands and market tendencies and by employing state-of-the-art technology with an uncompromising devotion to the law and ethics; and to ensure maximum customer satisfaction.
The Company aims to offer the best services to its customers by:
TEB Investment delivers its wide product and service portfolio to its customers both in Turkey and internationally through a range of service channels. To this end, the differentiated channels used for various investment services such as equity, forward transactions, mutual funds, bonds-bills and repurchases, as well as those used for special solutions, such as corporate finance, research, international capital markets, investment centers and internet branch - which are offered to different customer groups - are all collected under TEB Investment.
TEB Investment sets itself apart in the sector with:
TEB Investment ranked 4th with a 4.2% market share of ISE equity trading volume at the end of 2013, accounting for a total trading volume of TL 68,643 million. As of the same date, the Company was ranked 2nd on the Turkish Derivatives Exchange in terms of trading volume, where it commanded a market share of 7.46% with a total trading volume of TL 62,023 million.
THE ECONOMY BANK N.V.
The Economy Bank N.V. (TEB NV) was founded in 1998 in the Netherlands. TEB NV’s mission is to be one of the most active and service-focused players in the Turkish and European financial markets as the TEB Group’s specialized service provider in the international trade & commodity finance business line.
In 2005, TEB NV became a member of the BNP Paribas Group, which is one of the biggest financial institutions in the world. Thanks to this correspondent bank network, TEB NV began to offer services in 80 countries worldwide. Benefiting from BNP Paribas’ credit-risk analysis systems, the Bank continues to successfully reflect the synergy of the BNP Paribas Group to its customers’ trade and commodity finance portfolios.
TEB NV has set itself apart in the sector by virtue of its
TEB NV’s performance in 2013
TEB NV’s balance sheet was realized at € 606.9 million at the end of 2013, while its shareholders’ equity grew by € 5.0 million YoY to reach € 100.0 million. As in previous years, the Bank maintained liquidity and capital adequacy ratios above the sector averages in its operations.
TEB NV’s gross operating profit was realized at € 15.8 million with net interest revenues of € 24.8 million in 2013, while its net commission and fee revenues reached € 4.6 million. The Bank’s specific loan provisions remained at € 1.4 million as of the end of 2013. TEB NV recorded a net profit of € 5.0 million after tax and provisions, while its shareholders’ equity amounted to € 100.0 million.
In 2013, the total volume of trade transactions mediated in by TEB NV was realized at € 1.4 billion.
Having gained the admiration of its shareholders with its specialized personnel, robust financial performance and the high quality of the services it has been rendering for many years, TEB NV will continue to offer various trade and commodity finance solutions to its customers in 2014 by strictly adhering to its effective risk management policies aimed at maximizing customer satisfaction.