IFRS Earnings Presentation, March 31, 2012

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Türkiye Garanti Bankası A.Ş. announced its financial statements based on IFRS guidelines dated March 31, 2012. In 1Q2012, Garanti's total assets reached USD 92.9 billion, loans to customer totaled USD 52.9 billion. The Bank posted a net profit of USD 552 million and delivered an ROAE (Return on Average Equity) of 21% and ROAA (Return on Average Assets) of 2.4%.

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IFRS Earnings Presentation, March 31, 2012

  1. 1. March 31, 2012IFRS Earnings Presentation
  2. 2. Investor Relations / IFRS Earnings Presentation 3M121Q 2012 Macro Highlights Improving liquidity • Mixed messages from the US and the Eurozone economic indicators and risk appetite • Weak import demand from all three major regions in the global economy followed by doubts about the strength • Uncertainty around further easing by FED and ECB gained ground and sustainability of • Commodity prices are on the rise -- Gold was up by 7% & oil by ~20%. growth • Y-o-Y GDP growth rate in 4Q11 fell to 5.2% from 8.4% in 3Q11 -- An encouraging rebalancing is occurring within GDP o In 4Q11, highest positive contribution from foreign demand since 2Q09Economy heading for a o Private consumption & investments decelerated significantly in 4Q11 soft landing • Current account deficit ended the year at a decelerated level at US$ 77.2bn & improved financing quality • Annual CPI at the end of 1Q12 was 10.43% -- Even though core inflation started to come down, energy prices keep the headline CPI high • The policy interest rate was unchanged at 5.75% and the upper band of interest rate corridor was lowered from 12.5% to 11.5% o Interest rate corridor has been actively used since the end of 2011 o Average CBT funding rate surged in CBT’s effort to fight the inflationary pressures due to currency pass through o Taking the liquidity projections into account, the ranges for weekly and monthly Turkish lira funding were revised. Additionally, fraction of TL required reserves that can be held in gold were increased from 10% to 20%. This action alone released TL 6.1bn of reserves and increased banks’ liquidity • During 1Q12, TL appreciated by 1.6% and 1.5% against USD and Euro, respectively while benchmark bond yield was at 9.4% on a monthly average at the end of 1Q12 • Liquidity conversion ratio of issued bonds was reduced from 100% to 50% upon BRSA’s amendment in February • Effective as of January 1st, 2012, liquid fund management fee cap was decreased to 1.10% from 2.73% 2
  3. 3. Investor Relations / IFRS Earnings Presentation 3M121Q 2012 Highlights Customer-oriented, liquid, low-risk and well-capitalized balance sheetBalance sheet Maintained focus on profitable growth – selective lending continues on high margin productsstrength: TL lending growth 3.2% q-o-q, at a slower pace vs. sectordistinguishing • Healthy market share gains in high margin retail products with no pricing competitionfeature of Garanti... (Mortgage: 1.2% q-o-q vs. sector’s 0.8%; GPL: 4.2% q-o-q vs. sector’s 3.6%)1 • Intentional market share loss in TL commercial lending to maintain rational pricing and defend margins FX lending growth 3.4% q-o-q, driven by commercial lending FRN heavy securities book remain as a hedge -- FRN in total slightly down to 56% in 1Q 12 vs. 58% at YE 11, due to redemptions replaced with favorable fixed rate TL securities Asset quality remained intact • Slight pick-up in NPL ratio (1Q 12: 2.4%) -- as expected, across the board, at a lower pace vs. sector • Collections -- still strong, however at a normalizing pace Solid funding mix -- Actively managed and diversified • Deposit heavy funding remains with emphasis on sustainable and lower cost mass deposits • Opportunistic utilization of repos & money market funding to support margins • Sustained high demand deposit levels -- demand deposits / total deposits: 20% • Loans to Deposits @ 101%, LTD:79% when mortgages, project finance & invesment loans (mat.>4 years) are excluded Strong capitalization bolstered by high internal capital generation capacity: CAR1: 16%, Leverage:7x...leads to consistent Strong profitability backed by well-defended margins, sustainable income sources & efficiently managed costs ROAE: 21%; ROAA: 2.4%delivery of strong Margins holding-up well -- almost flattish when quarterly fluctuating CPI book is excludedresults • Ongoing positive effect of timely and proactive loan re-pricing on loan yields • Managed lending growth with higher weight in lucrative products and rational pricing Net fees and commissions -- Sustained double digit growth momentum on a comparable basis via highly diversified fee sources Commitment to strict cost discipline - single digit growth in real terms • Opex/ Avg assets: 2.4% in 3M12 vs. 2.5% in 3M11 • Fees/OPEX: 64% on adjusted basis2 vs. 56% on reported basis • Investment in distribution network continued (avg branch additions: ~50 y-o-y)1 Based on BRSA Consolidated financials2 Adjusted with the effect of decreased cap on fund management fees and accounting methodology change for cash loan origination fees 3
  4. 4. Investor Relations / IFRS Earnings Presentation 3M12Strategically and actively managed balance sheet leading to strong levels ofcore banking revenues & ROAE of 21% +5% q-o-qQuarterly net income (TL million) Improving Core Other Banking Revenues Inc. on income Inc. on Coll’n RRR 142 5% 5% 971 1,428 CPI-linkers 1 50 (TL million) 921 922 Net 488 960 ROAE: 21% Fees&Comm. 114 Trading 74 ROAA: 2.4% 1Q12 Net income NII-exc. inc. 541 Prov.exc. on CPI-linkers collections Net Sustained high & RR OPEX 253 Income profitability Other Provisions & Tax 1Q11 4Q11 1Q12 1001 971 • Ongoing positive effect of timely loan-repricing Other income limited the pressure of increasing funding costs Inc. on Inc. on Coll’n 119 CPI-linkers RRR 105 4 • Robust & growing fee base (TL million) 1,364 despite negative effects of decreased cap on fund Net 666 1,177 management fees & accounting methodology Fees&Comm. Trading change on cash loan origination fees 184 4Q11 Net income NII-exc. inc. 88 on CPI-linkers 500 Prov.exc. • Although lower, still strong contribution from & RR collections Net OPEX 248 CPI-linkers Income Other • Normalizing collections, as expected Provisions & Tax 1,047 922 4
  5. 5. Investor Relations / IFRS Earnings Presentation 3M12Customer-oriented asset mix -- Loans/Assets back to pre-crisis levelsTotal Assets (TL/USD billion) Composition of Assets Growth-1Q12 1Q12 Other Tangible Cash 7.6% Assets 1.0% 1% Equivalents In line with economic 20% 3.4% slowdown, moderating lending 161.4 163.5 Securities2 Loans to growth 24.6% customers 57.0% Loans 0.5% 136.3 Securities 2 10.5% Loans to 96.3 banks 6.4% 88.9 81.2 Loans/Assets 2011 Other Tangible 57.0% Cash 7.5% Assets Equivalents 1.1% vs. 57.4% at YE 11 2.1% Securities2 Loans to 36.0 38.9 38.2 22.5% customers 57.4% Liquidity Ratio1 1Q 11 1Q 11 TL FC (USD) 2011 2011 2012 1Q12 Total Assets (TL) Loans to banks 33% 9.4%1 (Cash and Balances wıith CB + Loans and Advances to banks+Trading securities + AFS)/Total Assets 52 Securities = Financial assets at fair value through profit or loss+Investment securities
  6. 6. Investor Relations / IFRS Earnings Presentation 3M12FRN heavy securities book continues to serve as a hedge -- redemptionsreplaced with favourable fixed rate TL securitiesTotal Securities1 (TL billion) TL Securities1 (TL billion) Securities1/Assets 11% 13% 40.2 25% 39.636.4 37.4 36.4 13% 18% 32.6 34.8 15% 17% 15% 30.8 31.0 30.7 3% 6% (8%) 11% 1% 5% (6%) 13% up from 23% at YE 11 85% 87% CPI: CPI: CPI: CPI: 83% 82% CPI: 85% 30% 32% 30% 29% 32% FRNs: FRNs: FRNs: FRNs: FRNs: 36% 36% 30% 30% 29% 1Q 11 2Q 11 3Q 11 2011 1Q12 FRN mix2 in total1Q 11 2Q 11 3Q 11 2011 1Q12 TL FCTotal Securities1 Composition FC Securities1 (USD Billion) (16%) 56% from 58% at YE 11 Financial 4.0 3.9assets at fair Available for 3.6value through Sale 3.0 3.0 profit or loss 90.8% 1.6% (3%) (22%) 10% 1% Held To Maturity 7.6% FRNs: FRNs: FRNs: FRNs: FRNs: 42% 32% 29% 31% 30% 1Q 11 2Q 11 3Q 11 2011 1Q12 1 Securities = Financial assets at fair value through profit or loss+Investment securities 2 Based on bank-only MIS data 6 Note: Fixed / Floating breakdown of securities portfolio is based on bank-only MIS data
  7. 7. Investor Relations / IFRS Earnings Presentation 3M12 Moderating loan growth in line with economic slow down -- Retail lending remains as the growth driver Total Loan1 Growth & Loans by LOB2 (TL million) TL Loan Growth3: Bank-only - Q-o-Q 0.5% 21% 90.0 3% 92.7 93.1 1.7% vs. Sector’s 4.1% 82.4  Mainly driven by lucrative 18.2% 16.3% Total 76.8 18.5% retail loans 18.4%  Refraining from pricing Corporate 20.1% competition in commercial lending to defend margins 39.5% 39.4% 39.0% 38.0% market share: 11.0% in 1Q 12 Commercial 37.7% vs. 11.3% at YE 11 11.8% 12.8% 12.8% SME 12.6% 13.1% FC Loan Growth3: Bank-only - Q-o-Q and US$ 11.6% 11.9% 12.2% based 11.9%Credit Cards Consumer 11.5% 18.0% 18.4% 18.1% 18.5% 19.3% 1.8% vs. Sector’s 2.2%  Healthy growth without sacrifying loan yields 1Q 11 1H 11 9M 11 2011 1Q12TL (% in total) 51% 52% 52% 52% 53% market share: 18.4% in 1Q 12FC (% in total) 49% 48% 48% 48% 47% vs. 18.5% at YE 11US$/TL 1.530 1.600 1.820 1.865 1.760 1 Cash Loans 2 Based on bank-only MIS data 7 3 Based on bank-only financials for fair comparison with the sector. Sector data is based on BRSA weekly data for commercial banks
  8. 8. Investor Relations / IFRS Earnings Presentation 3M12Sustained upward trend in loan yields -- positive result of selective growthstrategy and timely re-pricingTL Loans (TL billion) Interest Income on loans (quarterly – TL billion) 26% 2,164 49.8 2,070 46.6 48.2 1,906 39.5 42.7 1,554 1,635 3% 4% 9% 11.63% Total Yield1 8% 16.05% TL Yield1 10.72% 15.17% 14.75% 9.93% 9.92% 10.26% 14.47% 14.33% 1Q 11 2Q 11 3Q 11 2011 1Q12 1Q 11 2Q 11 3Q 11 2011 1Q12FC Loans (US$ billion) 1% 24.6 Ongoing positive effect of 24.4 24.8 23.9 23.8 timely loan re-pricing & selective 2% (4%) 3% growth in high-yielding loans (0%) 1 bolstered the yields 5.55% FC Yield 4.75% 5.12% 4.50% 4.51% 1Q 11 2Q 11 3Q 11 2011 1Q12 1 Based on bank-only MIS data and calculated using daily averages 8
  9. 9. Investor Relations / IFRS Earnings Presentation 3M12Selective growth focus -- Healthy market share gains in high-margin retail loans Retail Loans1 (TL billion) Mortgage (TL billion) GPL & Mortgage 23% 40.2 41.2 10% Market Share 36.6 38.6 9.7 10.0 10.2 10.3 (qoq) 33.6 11.0 11.4 9.4 0.6 0.6 , 10.9 0.6 0.6 10.5 0.6 9.5 4% 3% 3% 2% 1% +10 bps in GPL 9% 6% 4% 24.1 26.1 27.7 29.2 29.8 8.8 9.1 9.4 9.6 9.7 +12 bps in Mortgage 1Q 11 2Q 11 3Q 11 2011 1Q 12 1Q 11 2Q 11 3Q 11 2011 1Q 12 Consumer Loans Commercial Installment Loans Auto Loan (TL billion) General Purpose Loan5 (TL billion) Market Shares2,3 QtD Mar 12 Rank4 23% 2.8 31% 18.0 16.7 17.3 Mortgage 13.4% #1 15.4 13.8 8.3 8.7 8.3 Auto 15.0% #3 2.6 2.8 2.8 7.9 2.5 7.1 2.3 General 1.7 1.7 4% 4% 10.8% #2 1.6 1.6 12% 8% Purpose5 1.5 7% 1% 8.3 8.9 9.3 3% 6.6 7.5 10% 1.0 1.1 1.1 Retail1 12.9% #2 0.8 0.9 1Q 11 2Q 11 3Q 11 2011 1Q 12 1Q 11 2Q 11 3Q 11 2011 1Q 12Note: Garanti figures are based on BRSA consolidated financials; Sector figures are based on bank-only BRSA weekly data, commercial banks only1 Including consumer, commercial installment, overdraft accounts, credit cards and other 4 As of 2011 among private banks 92 Including consumer and commercial installment loans 5 Including other loans and overdrafts3 Sector figures are based on bank-only BRSA weekly data, commercial banks only
  10. 10. Investor Relations / IFRS Earnings Presentation 3M12Strength in card business – a good contributor to sustainable revenuesIssuing Volume (TL billion) Acquiring Volume (TL billion) #1 in card business 20% 14.7 17% 15.1 Per Debit Card Spending 12.3 13.0 ~2.5x the sector ... with the ultimate aim of creating cashless society Per Card Spending (TL, Mar 122) 6,750 6,183 1Q11 1Q12 1Q11 1Q12 Garanti SectorNo. of Credit Cards (thousand) Credit Card Balances (TL billion) Market Shares 717 24% QTD ∆ Mar 12 Rank 262 10.0 10.1 8,806 9.4 Acquiring -115 bps 18.8% #2 8.1 9.0 8,544 8,089 Issuing -56 bps 18.4% #1 6% 1% 5% # of 10% +24bps 16.9% #1 Credit Cards POS1 +75 bps 18.3% #1 1Q11 2011 1Q12 1Q 11 2Q 11 3Q 11 2011 1Q 12 ATM -4 bps 10.0% #31 Including shared POS2 Annualized 10Note: All figures are bank-only except for Credit Card Balances
  11. 11. Investor Relations / IFRS Earnings Presentation 3M12 Asset quality remained intact…NPL Ratio1Garanti 2.7% 2.5% 2.3% 2.3% 2.4%(IFRS) 4.4% Nominal NPLs 3.9% 3.7% 3.7% 3.3% 2.9% 3.8% Slight deteoriation -- 3% 2.7% 2.6% 2.7% 2.9% 2.6% 2.4% 2.5%  as expected 2.4% 2.1% 1.9% 1.8% 1.8% 1.9%  across the board  at a lower pace than sector 1Q 11 2Q 11 3Q 11 2011 1Q12 Garanti Sector Garanti excld.NPL sales & write-offs* Sector w/ no NPL sales & write-offs** Adjusted with write-offs in 2008,2009,2010 and 2011. 2010 and 2011 sector NPL sales & write-offs total: TL ~2.7 bn and ~TL 1.9 bn, respectively. Garanti sold NPLs in 1Q 11 amounting to TL 484mn, of which TL 200mn relates to the NPL portfolio with 100% coverage and the rest being from previously written-off NPLs. Gross income booked amounts TL 54mn.NPL Categorisation1Retail Banking Credit Cards Business Banking(Consumer & SME Personal) (Including SME Business)22% of total loans 12% of total loans 66% of total loans 7.7% 2.4% 2.0% 3.0% 7.0% 2.7% 2.4% 2.1% 1.9% 1.9% 6.3% 2.5% 2.5% 2.1% 5.7% 5.8% 1.8% 6.9% 1.6% 6.3% 5.8% 1.6% 1.6% 5.7% 5.8% 1.4% 1.2% 1.2% 1.2% 1.3% 1Q11 2Q11 3Q11 2011 1Q12 1Q11 2Q11 3Q11 2011 1Q12 1Q11 2Q11 3Q11 2011 1Q12 Garanti Sector 1 NPL ratio and NPL categorisation for Garanti and sector figures are per BRSA bank-only data for fair comparison. Source: BRSA, TBA & CBT 11
  12. 12. Investor Relations / IFRS Earnings Presentation 3M12 Solid funding mix – well diversified and actively managed Composition of Liabilities Total Deposits (TL billion)Other 5.7% 5.6% 5.8% 12.2% 11.2% 11.9% 14% (1%)SHE 12.6% 93.2 92.6Demand Deposits 11.7% 11.2% 88.6 81.4 84.5 IBL: 48% 49% 49% 49% IBL: IBL: 49% FC 71% 70% 70% 45.4% (2%)2 (5%)2 5% 2Time Deposits 48.0% 45.2% 2% 2 2% 0% TL 5% 6%Bonds Issued 0.6% 2.3% 2.3% 51% 52% 51% 51% 51%Repos 5.6% 7.3% 8.1%Funds Borrowed 16.2% 15.8% 15.3% 1Q 11 2Q 11 3Q 11 2011 1Q 12 1Q 11 2011 1Q12 Loans / 94% 98% 102% 99% 101% Deposits Cost of Deposits1 (Quarterly Averages) 8.8% 8.8% 9.1% 10.5% Loans/Deposits8.7% 8.4% 8.2% 8.8% • Opportunistic and timely 7.7% utilization of alternative 101% 9.0%7.8% 7.8% 7.8% 7.7% funding sources to support 7.4% 7.4% 6.6% 7.0% margins 3.1% 3.5% 2.6% 2.9% 3.1%2.1% 2.6% 2.1% 2.6% 2.3% 2.4% 2.6% or 79% when • Deposit costs rising as expected, however at a 2.1% 2.1% 2.4%1.8% 2.1% 1.8% mortgages, project finance contained manner due to 1Q 10 2Q 10 3Q 10 2010 1Q 11 2Q 11 3Q 11 2011 1Q 12 & investment loans focus on lower cost mass TL Time TL Blended (mat.>4yrs) are excluded deposits FC Time FC Blended 1 Based on bank-only MIS data 2 Growth in USD terms 12
  13. 13. Investor Relations / IFRS Earnings Presentation 3M12Robust deposit base with further emphasis placed on mass deposits andsustained high weight of demand deposits Deposits by LOB1 (Excluding bank deposits) Demand Deposits (TL billion) 15% 20.3 Corporate 13.7% 16.8 18.9 0.8 18.3 16.4% 16.3% 16.0 0.5 0.5 0.5 0.6 19.5 17.8 18.4 16.2 21.4% 15.5 Commercial 20.9% 23.6% 16.4% SME 16.0% 1Q 11 2Q 11 3Q 11 2011 1Q 12 15.4% Bank Deposits Customer Deposits Demand Deposits3 / Customer Demand Consumer 44.6% 46.8% 48.5% Total Deposits Deposits2 19% vs. sector’s 16% Solid presence in demand deposits maintained Sizeable demand deposit Market share: 14.5% 1Q11 2011 1Q12 level maintained1 Based on bank-only MIS data 132 Sector data is based on BRSA weekly data for commercial banks only3 Based on bank-only financials for fair comparision with the sector. Demand Deposits/ Total Deposits as per IFRS figures is 20%.
  14. 14. Investor Relations / IFRS Earnings Presentation 3M12High internal capital generation capability bolsters strong capitalization ratiosCAR1 Free Funds TL Billion (Free funds=Free Equity + Demand Deposits) Free Funds/IEAs 29.3 26.6 19% Free Equity w/o reserve 20.3 18.3 15.8% 15.7% Demand Deposits growth: TIER I TIER I 8% q-o-q 14.1% 14.7% Increasing free equity and sizeable demand deposits continued to support free funds Recommended 12% 16.1 17.4 Free Equity including Required Reserve Requirements 8% 2011 1Q12 Leverage Ratio -7.2 -9.1 Reserve Requirements 7x 2011 1Q12 2011 1Q121 Based on BRSA Consolidated financialsFree Equity = SHE - ( Net NPL+ Investment in Associates and Subsidiaries + Tangible and Intangible Assets+ AHR+ Reserve Requirements) 14
  15. 15. Investor Relations / IFRS Earnings Presentation 3M12Margins held up well, despite the negative quarterly fluctuation of the CPI bookand the duration mismatchQuarterly NIM (Net Interest Income / Average IEAs) NIM Adjusted NIM 4.7% 4.1% 4.1% 4.2% 3.8% 4.0% 3.7% 3.4% 3.4% Quarterly NIM: 2.7% (60bps) (26bps) ~Flattish when volatility from CPI linkers are excluded  Ongoing positive effect of 1Q 11 2Q 11 3Q 11 4Q 11 1Q 12 1Q 11 2Q 11 3Q 11 4Q 11 1Q 12 timely and proactive loan re- pricing on loan yields  Managed lending growth Q-o-Q Evolution of Margin Components (in bps) with higher weight in lucrative products and +32 -48 rational pricing +17 -1 -54 Loans Other Inc. 467 Securities Securities Items -7 407 -30 397 CPI exc. CPI Deposits Other Exp. +20 Squeeze in Adj. NIM was limited Items Provisions FX&Trading due to relief in general provisions 4Q 11 1Q 12 1Q 12 NIM NIM Adj NIMSource: BRSA Consolidated FinancialsAdjustments to NIM: Net Interest Income/ Average IEA adjusted by FX gain/loss, provision for loans and securities, and net trading income/loss 15
  16. 16. Investor Relations / IFRS Earnings Presentation 3M12 Healthy Fees & Commissions income supported by strong customer penetration and cross-sell Ordinary Banking Income1 Generation Net fees and comm. Garanti Peers • Leader in interbank money transfer market share % 18% market share vs. the peer’s average ~10%25% • Highest payment systems commissions per volume20% 1.6% vs the peer’s average 1.3%5 6.3 4.115% 4.8 • #1 in bancassurrance 5.110% • Strong presence in brokerage 3.9 ~6% market share5% 2.7 Ordinary banking income (TL Billion)0% - 2,000 4,000 6,000 8,000 Net Fees & Commissions Breakdown 3,4 Net Fees & Commissions TL Million 10% 3M11 Cash Loans 3M12 Effect of accounting 18.6% Cash Loans methodology change 21.0% on loan orig. fees & decreased cap onPayment fund managementSystems Non Cash Payment (3%) Systems Non Cash 560 2 31.4% Loans Loans 541 Net fees & Comm. 8.8% 39.4% 5.6% Money 3M11 3M12 Money Transfer Transfer 7.7% Money transfer4 14% Other 8.3% Insurance Insurance 14.9% 6.8% Brokerage 5.0% Cash Loans4 19% Asset Mgt Other 4.6% Asset Mgt Brokerage 7.4% 15.2% Payment Systems4 32% 1.7% 3.9% 1 Defined as; net interest income adjusted with provisions for loans and securities, net FX and trading gains + net fees and commissions. Based on bank-only financials for fair comparison as of 2011 2 3M12 cash loan origination fees are accounted for on an accrual basis per methodolgy change 16 3 Breakdown is on a comparable basis to same period last year 4 Bank-only MIS data 5 Peer average as of 2011
  17. 17. Investor Relations / IFRS Earnings Presentation 3M12Differentiated business model leading to consistent delivery of outstandingresults (TL Million) 1Q 11 1Q 12 % Change (+) NII- excl. inc on CPIs & RR 980 1,001 2% (+) Net fees and commissions 560 541 -3% (-) Provisions before collections -212 -114 -46% OPEX/Avg. Assets Double-digit growth = CORE BANKING REVENUES 1,328 1,428 8% in Net Fees & (+) Income on RR 0 1 n.m. Commissions sustained on a comparable basis* 2.4% (+) Income on CPI linkers 163 488 200% (+) Trading & FX gains 255 74 -71% (+) Collections 205 50 -76% Fees/OPEX (+) Other income -before one-offs 159 142 -11% Increase in OPEX (-) OPEX -858 -960 12% mainly stemming from: 64% on adjusted basis* (-) Taxation and other provisions -284 -253 -11%  ~50 average new vs. 56% on reported basis (+) One-offs (post -tax) -47 0 n.m. branch openings (+) -NPL sale 43 0 n.m. y-o-y  Double-digit Cost/Income (-) -Free provisions -90 0 n.m. inflation readings = NET INCOME y-o-y Equity holders of the Bank 921 918 971 961 5% 5% 40.4% Minority Interest 2 9 n.m.* Adjusted with the effect of decreased cap on fund management fees and accounting methodology change on cash loan origination fees 17
  18. 18. Investor Relations / IFRS Earnings Presentation 3M12Appendix
  19. 19. Investor Relations / IFRS Earnings Presentation 3M12 Balance Sheet - Summary(TL million) Mar-11 Dec-11 Mar-12 YTD ChangeASSETSCash &Banks 14,124 18,663 16,068 -14%Securities* 36,353 36,361 40,189 11%Loans to Customers 76,768 92,654 93,113 0%Tangible Assets 1,571 1,711 1,633 -5%Other 7,526 12,012 12,457 4%TOTAL ASSETS 136,343 161,401 163,460 1%LIABILITIES & SHEDeposits from Customers 78,793 90,139 88,995 -1%Deposits from Banks 2,602 3,097 3,611 17%Repo Obligations 7,604 11,738 13,173 12%Bonds Payable 828 3,742 3,751 0%Funds Borrowed 22,090 25,448 24,993 -2%Other 7,795 9,087 9,512 5%SHE 16,632 18,150 19,424 7%TOTAL LIABILITIES & SHE 136,343 161,401 163,460 1% * Securities = Financial assets at fair value through profit or loss+Investment securities 19
  20. 20. Investor Relations / IFRS Earnings Presentation 3M12Long-term strategy of investing in CPI linkers as a hedge for expected reversal inmarket indicators Drivers of the Yields on CPI Linkers1 (% average per annum) Interest Income3 & Yields on TL Securities (TL billion) 28.4% 21.8% 21.7% 15.4% 16.2% 13.5% 15.1% TL Sec. Yield1 incl. CPIs 11.5% 9.3% 9.7% 9.4% 9.8% 7.1%6.9%6.7%6.6%6.6% 7.8% TL Sec. Yield1 excl. CPIs 9.7% 10.0% 9.0% 9.4% 9.7% 3.0% 0.7% (10%) 1,169 Real Rate Inflation Impact Yield 1,053 503 806 1Q 11 2Q 11 3Q 11 4Q 11 1Q 12 670 687 565 452 Income 508 465 excl. CPIs 666 488 354 CPI effect2 163 222 1Q 11 2Q 11 3Q 11 4Q 11 1Q121 Based on bank-only MIS data2 Per valuation method based on actual monthly inflation readings 203 Based on BRSA consolidated financials
  21. 21. Investor Relations / IFRS Earnings Presentation 3M12Details of select items in funding base 1Q 11:Bonds issued • TL 1 billion bond with 1 year maturity, at a cost of 7.68% 2Q 11: • TL 750 million bond with 6M maturity, at a cost of 8.41% • TL 750 million bond with 6M maturity, at a cost of 8.54% • US$ 500 million Eurobond with 10 year maturity, fixed coupon 6.25% • US$ 300 million Eurobond with 5 year maturity, floating 3M LIBOR + 2.5% 4Q 11: • TL 750 million bond with 6M maturity, at a cost of 8.10% (Roll-over) • TL 750 million bond with 6M maturity, at a cost of 10.09% (Roll-over) 1Q 12: • TL 350 million bond with 92 days maturity, at a cost of 10.54% (Roll-over) • TL 650 million bond with 176 days maturity, at a cost of 10.69% (Roll-over)Funds borrowed 2Q 11: • Secured € 1 billion 1 year syndicated loan, comprising two separate tranches in the amount of € 782.5 million and US$ 304.5 million. The all-in cost has been realized as EURIBOR+1.1% and LIBOR+1.1%, respectively. • Borrowed € 50 million and US$ 225 million with 5 year maturity under Diversified Payment Rights securitization program 4Q 11: • Secured US$ 1 billion 1 year syndicated loan, comprising two separate tranches in the amount of US$ 233.6 million and • €576.2 million. The all-in cost has been realized as LIBOR+1% and EURIBOR+1%, respectively. 21
  22. 22. Investor Relations / IFRS Earnings Presentation 3M12Disclaimer StatementTürkiye Garanti Bankasi A.Ş. (the “TGB”) has prepared this presentation document (the “Document”) thereto for the sole purposes of providing informationwhich include forward looking projections and statements relating to the TGB (the “Information”). No representation or warranty is made by TGB for theaccuracy or completeness of the Information contained herein. The Information is subject to change without any notice. Neither the Document nor theInformation can construe any investment advise, or an offer to buy or sell TGB shares. This Document and/or the Information cannot be copied, disclosed ordistributed to any person other than the person to whom the Document and/or Information delivered or sent by TGB or who required a copy of the same fromthe TGB. TGB expressly disclaims any and all liability for any statements including any forward looking projections and statements, expressed, implied,contained herein, or for any omissions from Information or any other written or oral communication transmitted or made available.
  23. 23. Investor Relations / IFRS Earnings Presentation 3M12Investor RelationsLevent Nispetiye Mah. Aytar Cad. No:2Beşiktaş 34340 Istanbul – TurkeyEmail investorrelations@garanti.com.trTel +90 (212) 318 2352Fax +90 (212) 216 5902Internet www.garantibank.com

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