EVALUATION OF FINANCIAL STATUS, PROFITABILITY AND SOLVENCY

A review of TEB’s financial statements that are drawn up in accordance with the regulations of the Banking Regulation and Supervision Agency (BRSA) reveals as follows:

TEB’s after-tax profit for 2018 reached to TL 1 billion and the Bank posted a RoE of 11,18% in line with its strategies focused on profitability and productivity.

While the Bank’s total assets grew by 13% to TL 96.997 in 2018, total loans reached TL 64 billion; in this context, the Bank continued to extend maximum support to its individual and corporate customers. As part of the strategy to offer service to a broader customer base, retail loans reached TL 16,1 billion. Loans made available to SME, Commercial and Corporate customers that serve as a key indicator of TEB’s regular support to the national economy were worth TL 48 billion and accounted for 74% of the Bank’s performing loans portfolio.

As at end 2018, TEB converted the entirety of the deposits it has collected into loans and finished the year with a loans/deposits ratio of 100%. Time deposits volume that covers a substantial portion of the Bank’s funding need went up 14% and the ratio of total deposits to balance sheet liabilities was registered as 66%. On the other hand, demand deposits also reached TL 11,64 billion, making a significant contribution to the Bank in terms of funding cost.

TEB signed a syndicated loan facility agreement with the participation of 17 international banks for the purpose of supplying a loan in the amount of EUR 433,5 million and USD 33,5 million with 367-days maturity. 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.

Within the frame of efforts to diversify funding sources and to present investors with alternative products besides deposits, the following TEB bonds with a total nominal value of TL 5,12 billion were offered in domestic markets:

• a 118-day bond with a nominal value of TL 287,8 million in January 2018;
• a 104-day bond with a nominal value of TL 208,1 million in January 2018;
• a 111-day bond with a nominal value of TL 84,3 million in January 2018;
• a 181-day bond with a nominal value of EUR 5 million in January 2018;
• a 118-day bond with a nominal value of TL 72,9 million in February 2018;
• a 119-day bond with a nominal value of TL 377,3 million in February 2018;
• a 123-day bond with a nominal value of TL 4,7 million in March 2018;
• a 119-day bond with a nominal value of TL 342,6 million in March 2018;
• a 119-day bond with a nominal value of TL 272,9 million in March 2018;
• a 175-day bond with a nominal value of TL 151,3 million in April 2018;
• a 125-day bond with a nominal value of TL 225,4 million in April 2018;
• a 119-day bond with a nominal value of TL 477,9 million in April 2018;
• a 119-day bond with a nominal value of TL 247,4 million in May 2018;
• a 126-day bond with a nominal value of TL 316,2 million in May 2018;
• a 98-day bond with a nominal value of TL 307,9 million in July 2018;
• a 98-day bond with a nominal value of TL 356,3 million in July 2018;
• a 122-day bond with a nominal value of TL 11,1 million in July 2018;
• a 91-day bond with a nominal value of TL 587,1 million in August 2018;
• a 72-day bond with a nominal value of TL 109,3 million in August 2018;
• a 70-day bond with a nominal value of TL 135,2 million in September 2018;
• a 69-day bond with a nominal value of TL 374,2 million in November 2018;
• a 70-day bond with a nominal value of TL 163,2 million in December 2018.