CEO'S ASSESSMENT

As the Turkish economy enters a period of growth in the new year, TEB will stand at the heart of this process and continue to strongly support the real economy.

Esteemed shareholders, customers, business partners, and colleagues,

When we look in general, we see 2019 as a year when many uncertainties were lifted, the basic balances started to settle down and growth resumed again. We believe our country has managed this process well.  A good level of coordination and cooperation between the private, public and banking sectors has been achieved. The Turkish banking sector successfully rounded of what we consider to be a year of “balancing”. While banks renewed their syndications, they strengthened their liquidity and thus contributed significantly to the preparation of the infrastructure that will finance Turkey's growth in 2020.

TEB maintained its share in SME Banking at a certain balance in 2019 while it has moved more aggressively in Retail and Corporate Banking with the power of technology. Our goal is to maintain this momentum we have gained by maintaining this balancing in 2020.

We have played our part to create value for our customers, shareholders and all other stakeholders while contributing to financial growth to support the recovery of the country's economy throughout the year. We have maintained our work which has a positive impact on society such as the consultancy support we provide to SMEs and entrepreneurs, the networking opportunities we offer to female managers and the financial literacy training we provide to different segments of society.

We continue to support the economy                      

As of December 31, 2019, the total assets of Turkish Economy Bank had increased by 11% throughout the year to reach TL 107,4 billion. Our net profit stood at TL 1,1 billion. Loans, the most important indicator of our support for the economy and to our customers, accounted for 65% of our total assets.

As always, we prioritized risk management and asset quality. While our total loans were realized as TL 69,2 billion in 2019, our total deposits increased by 12% and reached TL 72,2 billion. While our shareholders' equity reached TL 9,7 billion, our bank's capital adequacy ratio was 16.95%, well above the target ratio of 12%.

We contributed to the economy with a syndication loan                                                          

As we had targeted, TEB signed a new syndication loan for USD 400 million in October 2019. This loan was provided with the participation of 22 leading banks from the USA, Canada, the EU, the Middle East and Asian countries. The loan, provided with a maturity of 367 days, and an amount of EUR 306 million and USD 61,5 million, is planned to be mainly used in export financing. This syndication loan, which is aimed at contributing to the Turkish economy, is also considered to be an indication of the confidence of international investors in our bank, the Turkish banking sector and the Turkish economy.

Moving to the future with work on digitalization We anticipate that the technological transformation and digitalization will shape the economy and competition in the real sector in the future. TEB is focused on digitalization, a field that requires innovation, creativity and, above all, action, in its business processes as well as in the products and services it offers. Our digital banking platform, CEPTETEB, is at the heart of our investments in this field.

Our mobile application, CEPTETEB İŞTE, which provides fast and easy financial transactions for our SME, Corporate and Business customers, was launched in the last quarter of 2019. With CEPTETEB İŞTE, our SME, Corporate and Business customers can easily perform day-to-day banking, cash management and investment transactions through digital channels without having to visit the branch office. 

TEB SME Banking new service model                       

In 2019, TEB restructured its SME Banking service model to suit the changing and diversified needs of customers. Within the scope of our segmentation efforts, in which we aim to provide the right level of service to the right segment, our TEB SME Banking service aims to offer a wide range of boutique products ranging from foreign trade, project financing and derivative products to supplier financing, for companies seeking specialized services. The digital service model has been re-established with the aim of enabling small-scale companies to perform daily banking services more rapidly and to include automated credit processes. As such, we aim to both increase the number of TEB SME Banking customers and also increase customer satisfaction.

TEB Women’s Banking  success goes beyond Turkey’s borders                                                           

As a bank that promotes efforts to strengthen the presence of women in business and contribute to their greater involvement in the economy, TEB Women's Banking continued to stand alongside women bosses throughout the year. In addition to our versatile financing support, special training, mentoring and consultancy services were provided to women bosses.

In 2019, TEB provided EUR 50 million in funding through the “Financing and Consulting Support for Women Enterprises” program, implemented by the European Union, the European Bank for Reconstruction and Development (EBRD), the Ministry of Labour and Social Security and the Turkish Employment Agency to support enterprises owned or managed by women and to promote women entrepreneurs.

With our efforts, significant successes have been achieved not only throughout the country but also in the international arena. The financial and non-financial services which we offer under TEB Women's Banking were nominated in the "Environmental and Social Innovation" category by the EBRD in 2019. As a result of the competition, TEB Women's Banking, which represents our country internationally, has been involved in 52 different projects worldwide and received the "Golden Award", giving us great pride as a team.

We focus on technology companies with Venture Banking                                                                       

TEB undertook a great deal of work in 2019 to contribute to the development of the entrepreneurial ecosystem in Turkey. In our efforts to reach entrepreneurs throughout the country and bring their innovative business ideas to the economy, we especially benefit from developing technologies and the contribution of these technologies to the banking sector. With the developing technologies, the number of technology companies working in this field in our country as well as all over the world is rapidly increasing, with TEB providing the support that technology companies need to grow in this area, which offers tremendous growth potential in our country. The Bank has developed a loan program for the portfolio of technology companies by developing products, services and applications specific to technology companies. Our difference in this field is that we offer resources which will represent lifeline support.

We carry the financial sector to the future with Turkish Fintechs                                                         

We consider Fintechs, which are key players in the digital transformation of the financial sector, as our medium and long-term business partners. In 2019, TEB was once again one of the key players shaping the future of the financial sector and directing the transformation together with Fintechs. We work with Fintechs in particular on digital transformation projects which require high software competence and in the development of new financial products and services that demand creativity. TEB is focused on providing applications, products and services which will provide customers with a better experience  with Fintech partners through the API program it launched. Studies on remote customer acquisition, digital signature, video banking and personalized products and services are being carried out, and TEB's start up business partners are participating as stakeholders in a significant number of these transformation projects.

Spreading Financial literacy with TEB                 

Public and free financial literacy training continued in 2019 under the roof of the TEB Family Academy, where we aim to contribute to the development of financial literacy awareness while promoting savings habits throughout the society. While taking our leadership in financial literacy one step further, “Digital Financial Literacy” training was provided to university students, in line with the interest of the new generation in financial technologies and the requirements of the age.

With the aim of ensuring all age groups are financially literate throughout society, financial literacy training has been provided to approximately 19 million individuals, both through in-class financial literacy training programs and through digital financial literacy training provided in universities. In 2019, digital financial literacy education was offered to more than 6,500 students at 30 universities, while the number of individuals receiving in-class education alone rose to over 10,000.

2020 to be the year of growth                               

Our country is able to overcome economic volatility by deploying its structural advantages, especially its strong banking sector, robust dynamic economy and demographic characteristics. While protecting the weight of young people in the population provides an important economic motivation, it helps maintain a strong consumption trend in all market conditions. When we consider all of all these things together, we expect stronger growth in Turkey in 2020.

As the Turkish economy enters a period of growth in the new year, TEB will stand at the heart of this process and continue to strongly support the real economy. We have determined our 2020 strategy to be the 'Most Practical Bank' that facilitates the lives of our customers with all our digital investments.

Focusing on efficiency, value creation and excellence in the customer experience, we will work hard to achieve all of our goals, especially in the fields of Corporate, Retail and SME Banking. We will create value for our shareholders, customers, employees and all of our stakeholders.

As one of the important banks and a good corporate citizens in our sector and in Turkey, we will continue to serve the development and prosperity of our country.

On behalf of myself and the TEB management team, I would like to take this opportunity to thank our valued employees, who have demonstrated an exemplary and outstanding performance in 2019, and all of our stakeholders who have placed their trust and belief in the TEB brand for their valuable contributions.

Yours sincerely,

Ümit Leblebici
CEO