1q05 results

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Slide1: 

1Q05 BRSA Bank Only Financial Results May 2005

Highlights: 

Highlights Total assets increased 8.4% q-o-q, reaching TRY 38bn (USD 27.5bn) Continued growth in loan portfolio of 7% q-o-q 11% growth in TL loans -mostly made up of high yield SME and consumer loans Aggressive growth in deposits, up 10% q-o-q, generated from 34% growth in TL deposits Net commission income growth 49% y-o-y, driven by the strong growth in credit card revenues 32% growth in net profit, reaching TRY 352mn (USD 256mn)

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Net interest income Net fee income Income before tax Net income ROAA (%) ROAE (%) 1Q05 1Q04 Profitability 606 134 502 352 3.9% 22.7% 602 90 410 266 3.4% 18.9% 1% 49% 22% 32% change Profitability performance (TRY mn.)

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Interest Earning Assets Interest Bearing Liabilities Loans / Total Assets Loans / Deposits* Deposits / Total Assets NPL Ratio Capital Adequacy Ratio 1Q05 YE04 91.0% 79.2% 37.3% 64.3% 58.1% 1.7% 33.6% 91.1% 77.4% 37.6% 66.0% 57.1% 1.6% 36.2% Ratios Balance sheet performance * Blocked demand deposits of POS merchants (TRY 545 mn), which encompasses the character of a demand deposit, is booked as “Miscellaneous Payables” instead of deposits

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Composition of securities 51% 49% 68% 32% Securities to total assets shrunk to 41% from 44% q-o-q Eurobonds amounting to TRY 537mn (USD 491mn) and TRY 85mn (USD 62mn) are registered under trading and available-for-sale securities portfolios, respectively Major portion of TL securities are carried under available-for-sale securities, profits being booked under equity Composition of securities (TRY bn.) 7.8 7.9

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Loans TRY 12,9 bn. TRY 13.9 bn. up 7% q/q TL loans surged 11% q-o-q, compared to 6% growth in the sector Akbank’s market share in loans reached %13 Despite the strong growth, NPL ratio has been low at 1.7% and fully provisioned Composition of Loans

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Breakdown of Loans Consumer and SME lending is now 60% of total loans

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Segment based developments

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Credit Card Loans1 Credit Cards Issuing Volume1 Retail Banking - credit cards Strong product mix and solid retail partners has boosted the credit card business 3% growth in credit card loans q-o-q 3.1 million active credit cards by 1Q05 1 Amex is included * At 2004 prices Market shares are cumulative

Retail Banking - consumer loans: 

Retail Banking - consumer loans 1 Numbers represent direct lending to individuals, excluding credit cards Akbank’s consumer loans’ market share reached 15.4%, increasing 20% q-o-q Market share in car loans reached at 27.1% from 24.2% q-o-q Market share in morgage loans reached 14.4%, registering a 50% increase q-o-q Consumer Loans1 (TRY mn.) *At YE04 prices 20% q/q

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Retail Banking - small business Small Business Loans1 (TRY mn.) Only 4% in FX Special credit packages for; Certain sectors and regions (pharmaceuticals, agriculture, tourism etc.) Dealer networks of corporate clients (ie. Microsoft, IBM, Bosch, Arçelik) *At YE04 prices 1 Small business loans given to companies with sales turnover <USD 2 mn are granted by the retail banking unit Cross sell ratio in small business loans reached 3.1x versus 2.6x in 2004

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Commercial Banking Commercial Loans1 2003* 2004 Commercial loans are also considered as a hook product, which paves the way for further marketing opportunities like cash management services and foreign trade products There is already 41 commercial banking centers in 16 provinces and we are targeting to add approx. 5 more in a year Cross sell ratio in commercial loans reached 3.9x from 1.8x in a year (USD mn.) (TRY mn.) *At YE04 prices 2002* 1Q05 1 Medium size companies with sales turnover btw. USD 2–30 mn are serviced through our commercial banking unit

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Corporate Banking Loans to blue-chip companies like Ford, Unilever, Carrefour stand at USD 2.5 billion Project finance loans has reached USD 1.2 billion Special and structured financial solutions for corporate needs like cash management products regulating the collection and payment cycle of companies Blue-chip companies provide excellent cross-sell opportunities (3.9x)

Asset management : 

Mutual Funds (TRY mn.) Asset management Currently #2 in mutual funds The underlying factors behind this; Superior channel management Superior asset management performance Effective marketing and communication Private Banking Assets (USD mn.) Wide range of domestic and international investment products Top quality investment advisory service Cross-sell ratio in private banking is 3.5x *At 2004 prices

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26% q/q Breakdown of customer assets TRY 39 bn TRY 42 bn Total customer assets surged 9% q-o-q, compared to 2% for the sector Akbank’s market share for total customer assets constitutes 14% of the market versus 13% in YE04 Market share 8% 15% 20% 15% 32%

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Composition of interest income Income statement - composition of interest income Growth in TL loans has had a dramatic impact on interest income 1.1 1.1 TRY bn. *At YE04 prices

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Net fees & commissions (BRSA, TRY mn.) Net fees and commissions Net fee and commission income growth is mainly due to the rapid growth in credit cards We continue to implement and increase fees in all the product base Fees and commissions revenue contribution1 1Bank only - excluding commissions from cash and non-cash loans *At YE04 prices 49% Credit cards commissions Asset management fees Money transfer fees Other Consumer loan related

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Net fees & commissions/operating expense Net fees & commissions/operating income Improving fee income ratios in line with targets We are rapidly approaching our medium term fee to income target of 25%

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Efficiency ratios Restructuring of branches will largely be finalized at YE05 Centralization together with the new technology infrastructure continue to allow us to keep operational costs subdued Operating expense/average assets (%) Cost/income (%)

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Net interest margin NIM (%) NIM (after FX loss, loan provision) * 1Q04 and YE04 figures are after monetary loss

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Rapid asset switch to TL loans from TL securities affected the interest spread positively A y-o-y increase of 49% in net commissions was also an important factor for maintaining profitability Switching to nominal accounting from inflation accounting has eliminated the negative effect of monetary losses 352 Net fees income Tax Net income Income statement summary (1Q05, TRY million) 606 134 32 58 -69 -150 NII Net trading income Other income Operating expense -259 Provisions Income statement summary

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Total Equity (BRSA, TRY mn.) AKBANK Strong equity growth driven by strong profits Akbank will optimize its capital structure through its dividend policy of 30% min. - 50% max. cash dividend payment Buy-back of founders’ shares will further optimize equity Free Capital 2004 (BRSA, TRY mn.) Free capital comparison

Slide23: 

Akbank is the 1st bank in Turkey to buy its founders’ shares Akbank will buy-back these shares with cash, reducing its excess free equity This indicates active and disciplined balance sheet management An integral component of managing free equity along with M&A and dividend strategies Represents confidence of majority shareholders in strong future performance Has positive impact on share performance Reduces Weighted Average Cost of Capital hence valuation expectations Implies a higher future ROE performance The share price has been determined by an accredited third party appointed by the Commercial Court as TRY 403,248

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TOTAL ASSETS Cash and Due from Banks Securities Loans TOTAL LIABILITIES Deposits Funds Borrowed TOTAL EQUITY BRSA (TRY mn.) 2004** 2004 Shares (%) Balance sheet highlights 34,913 1,995 15,238 12,939 28,686 19,918 4,845 6,227 6 44 37 57 14 18 * 1Q05 figures are according to nominal accounting 1Q05* 37,832 1,835 15,694 13,873 31,678 21,970 4,332 6,154 5 41 37 58 11 16 1Q05 ** Amounts are expressed in terms of the purchasing power of TL at 31 December 2004

Slide25: 

Income statement highlights Interest Income Interest Expense Net Interest Income FX Gain (Loss), Net Provision for Loan Losses Net Interest Income after FX, Income/Loss & NPL Prov. Fees and Commissions (Net) Profit on Trading Securities (Net) Operating Profit Operating Expenses Monetary Loss Income Before Tax Tax Net Income BRSA (TRY mn.) 1Q04** 1,064 (462) 602 22 (23) 601 90 136 1,051 (212) (296) 410 (144) 266 ** Amounts are expressed in terms of the purchasing power of TL at 31 December 2004 1Q05* 1,066 (460) 606 (34) (69) 503 134 33 811 (226) - 502 (150) 352 * 1Q05 figures are according to nominal accounting

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TOTAL ASSETS Cash and Due from Banks Securities Loans TOTAL LIABILITIES Deposits Funds Borrowed TOTAL EQUITY BRSA (USD mn.*) 2004 2004 Shares (%) 25,490 1,456 11,125 9,447 20,943 14,542 3,537 4,547 * Figures are stated with exchange rates effective at respective dates Balance sheet highlights in USD 6 44 37 57 14 18 27,494 1,334 11,405 10,082 23,022 15,967 3,148 4,472 5 41 37 58 11 16 1Q05

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Interest Income Interest Expense Net Interest Income FX Gain (Loss), Net Provision for Loan Losses Net Interest Income after FX, Income/Loss & NPL Prov. Fees and Commissions (Net) Profit on Trading Securities (Net) Operating Profit Operating Expenses Monetary Loss Income Before Tax Tax Net Income BRSA (USD mn.*) Income statement highlights in USD * Figures are stated with exchange rates effective at respective dates 1Q04 1Q05 775 (334) 441 (25) (50) 366 97 24 589 (164) - 365 (109) 256 749 (325) 424 19 (16) 427 63 92 582 (149) (208) 288 101 187

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The information and opinions contained in this document have been compiled or arrived at by Akbank from sources believed to be reliable and in good faith, but no representation or warranty, expressed or implied, is made as to their accuracy, completeness or correctness. All opinions and estimates contained in this document constitute the Company’s judgement as of the date of this document and are subject to change without notice. The information contained in this document is published for the assistance of recipients, but is not to be relied upon as authoritative or taken in substitution for the exercise of judgement by any recipient. The Company does not accept any liability whatsoever for any direct or consequential loss arising from any use of this document or its contents. This document is strictly confidential and may not be reproduced, distributed or published for any purpose. Disclaimer Statement

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