1Q11 Earnings Release
On 10 May 2011, Yapı Kredi announced its consolidated 1Q11 results based on Turkish accounting standards (BRSA), reporting TL 532 mln net income
In 1Q11, Yapı Kredi reported TL 532 mln net income on the back of positive revenue performance despite NIM compression, accompanied by disciplined cost management and asset quality improvement. Loans/assets at 58%, confirming continuation of strong customer business focus
On 10 May 2011, Yapı Kredi announced its consolidated 1Q11 results based on Turkish accounting standards (BRSA), reporting TL 532 mln net income. Return on Average Equity (ROAE) was recorded as 20%. Capital adequacy ratio stood at 14.9% at Bank level and 14.4% at Group level.
The Bank posted TL 1,708 mln revenues (9% y/y) on the back of strong fee growth, positive trading results and solid collections performance compensating NIM compression driven by increasing regulatory pressure and competition. Strong fee growth of 13% y/y was driven by continued diversification of the fee base and focus on innovative products, new fee areas and solid performance of credit card fees. Cost growth was recorded in line with inflation at 3% y/y on the back of continued tight cost management and efficiency initiatives. Cost/income ratio improved to 41.6% (vs 43.8% in 1Q10).
In 1Q11, Yapı Kredi continued its customer business focus and recorded total loan growth of 4%, concentrating on higher margin general purpose (18%) and SME loans (12%) in local currency retail lending and project finance loans in foreign currency corporate/commercial lending. In credit cards, Yapı Kredi maintained its leadership position with 18.7% outstanding volume market share.
The Bank’s healthy funding base was further strengthened and diversified in 2011. Yapı Kredi sustained its strong deposit base with 2% growth in 1Q driven by foreign currency deposits (5% in US$ terms). Solid demand deposit to total deposits ratio was maintained at 17% (stable vs YE10). In April 2011, the Bank successfully secured a USD 1,450 mln one-year syndication with more favourable conditions both in terms of amount (145% rollover) and pricing (all-in cost at Libor / Euribor+1.10%)
Yapı Kredi continued its #2 position in assets under management with 18.1% market share. The Bank also maintains leading positions in leasing (#2) and factoring (#1) with 14.9% and 19.1% market shares, respectively.
In 1Q11, the Bank recorded strong improvement in asset quality driven by better macroeconomic conditions, decelerating/stabilising NPL inflows, strong collections and credit infrastructure improvements. NPL ratio decreased to 3.2% (vs 3.4% at YE10). Specific coverage of NPLs was realised at 78% (vs 77% at YE10).
Improvements in commercial effectiveness continued driven by focus on ongoing initiatives including decreasing customer response time, focus on customer acquisition, conversion of credit-card only customers into banking customers and product bundles. In 1Q11, customer business per employee increased 28% y/y and revenues per employee increased 3% y/y. Through continued focus on enhancing systems and alternative delivery channels, share of non-branch channels in total transactions reached 77% as of 1Q11.
As of the end of March 2011, Yapı Kredi has the fifth largest branch network in Turkey with 868 branches and 9.1% market share.
Istanbul, 10 May 2011
Yapı Kredi / 10 May 2011