TEB 2018 Annual Report

In 2018, TEB’s total assets went up by 13% to reach TL 96,9 billion in the January-December period, while the Bank booked TL 1 billion in net profit. Loans, which make up the most important indicator of TEB’s support to the economy and its customers, accounted for 66% of its total assets in 2018.

Giving priority to risk management and asset quality, as always, our bank’s total credits were TL 64 billion and deposits were up by 15.5% and reached TL 64.2 billion. Maintaining its stable growth along with its robust capitalization, TEB’s shareholders’ equity reached TL 9,7 billion, while capital adequacy ratio was a strong 16,93%, well above the targeted ratio of 12%. The Bank’s NPL ratio was 4,15%.

In October 2018, TEB signed a syndicated loan agreement for EUR 433,5 million and USD 33,5 million with a maturity of 367 days which was participated by 17 international banks. When the paid portion of the loan which was drawn in prior year is compared, renewal rate of 101% was realized. This syndicated loan which is an indicator of TEB’s success and strong standing of the industry was not only used particularly in financing of exports, it also provided a great contribution to Turkish economy. All-in-cost of the loan is Euribor+2,65% and Libor+2,75%, for Euro and USD portions, respectively.

TEB’s support for SMEs continued. With our “Consultant Bank” approach we not only provide financing to our SMEs which are the driving forces of the Turkish economy but also support them with non-financial products and services. In 2018, TEB conducted many successful activities under SME Banking. With the TEB SME Academy, TEB SME Academy Industry 4.0 and TEB Women’s Academy, the Bank travelled from one city to another to continue meeting with SMEs and women entrepreneurs.

TEB SME Banking made another collaboration to support SMEs achieve their sustainable growth and foreign trade targets. TEB’s cooperation with Association of Turkish Machine Manufacturers (MİB) which is one of the key representatives of machinery production industry, increased its support to the real sector.

In accordance with the terms of the agreement, joint projects will be conducted and implemented in areas such as technology, entrepreneurship and production with mentoring programs. In addition to that, TEB will provide tailored financial services and products for MİB members. Moreover, TEB will assume coordination of growth and development programs for production and exports to contribute to Turkish economy and exports of MİB members.

In 2018, number of users of TEB’s digital banking platform CEPTETEB, which puts digitalization at the center to ease lives of SME customers, has exceeded 600 thousand in its third year.

TEB continues to provide services at numerous parts of Turkey by increasing the number of TEB Practical Branches which were introduced as a necessity of TEB’s pioneer position in digital banking and digital transformation of the industry. Number of TEB Practical Branches, the new banking approach which combines digital and physical branches, reached a total of 25 of which eight operates in Istanbul, eight in Bursa, five in Denizli and four in İzmir.

TEB Practical Branches, at which all documentation are authorized digitally over the device, users can perform cash withdrawals, deposits, transfers, payment and credit card delivery transactions as well as transactions which require wet signature. TEB Practical Branches which are planned to be expanded in 2019, also contribute to operational efficiency.

In line with its objective of supporting start-ups which create solutions for finance industry and offering innovative products with them, the Bank started TEB Fintech Future Four Program and cooperated with a strong foreign partner to help Turkish fintechs to open up to foreign countries. TEB Fintech Future Four Program is not a competition but a platform where applications are received throughout the year and bright ideas are expected.

Additionally, the Bank also started a Digital Financial Literacy Program. As one of the oldest implementers of Financial Inclusion Programs which play an important role in reaching Sustainable Development Goals, TEB continues its efforts to expand the habit of savings all around the country and raise a financially literate generation. Within the scope of this program, TEB helped deliver financial literacy trainings to more than 19 million people from various segments of the society.

We hereby present the operating results and financial statements of TEB for 2018 fiscal year for your comments and review. On behalf of the Board of Directors and myself, I would like to thank you, our valued shareholders, our team, our customers and our business partners for accompanying and having confidence in us throughout our journey.

Sincerely,

Board of Directors