1Q14 Earnings Release
Rapid response to challenges ensuring continuing resilience
On 30 April 2014, Yapı Kredi announced its consolidated 1Q14 results based on Turkish accounting standards (BRSA). The Bank continued its customer-oriented approach and recorded timely execution in key areas thereby ensuring continuing resilience.
“Market share gains in value generating areas with comfortable liquidity position maintained”
In 1Q14, the Bank recorded 3.9% ytd loan growth driven by value generating general purpose loans (+6.4%), mortgages (+3%), company loans in local currency (+10.4%) and SMEs (+9.4%). During the same period, total deposits grew 2.2% driven by both local and foreign currency deposits. In terms of demand deposits, Yapı Kredi achieved above sector growth (3% vs -1% sector) and recorded a demand to total deposit ratio of 16.4%. At the same time, the Bank continued its funding diversification via its GMTN programme (already reached > US$ 900 mln) and local currency bond issuances (TL 1.9 bln new TL bonds). Loans to deposits plus TL bonds ratio remained at a comfortable level of 110%.
“Focus on dynamic pricing on loans and deposits leading to NIM expansion vs 4Q13”
Yapı Kredi recorded TL 1,938 mln revenues (+5% y/y) driven by net interest income and collections performance. Net interest margin expanded by 13 bps on a quarterly basis and reached 3.4% thanks to repricing approach on both loans and deposits following significant rate hike by CBRT in Jan’14. During the same period, the Bank recorded 3% y/y fee growth offset by strong collections under other income. Additionally, Yapı Kredi continued its better than sector evolution in cost management with 15% y/y increase incorporating investments for growth. Net income was realised at 429 mln TL indicating return on average tangible equity of 10%.
“Resilient capital base with continuing volume growth and dividend payment”
Bank capital adequacy ratio was realised at 15.9% (vs 16.0% at YE13) despite above sector volume growth and dividend payment of TL 388 mln from 2013 net income (12.75% pay-out ratio). Resilient capital performance was supported by the Bank’s conservative and customer-oriented balance sheet with highest share of loans in assets among peers (61%).
“Asset quality intact with increasing coverage”
Asset quality remained intact with stable NPL ratio at 3.5% supported by slowdown in pace of NPL inflows and sustained trend in collections. Specific coverage increased to 71% (vs 67% at YE13) while cost of risk decreased to 1.11% (vs 1.27% at 2013) supported by strong collections performance.
“Successfully scaling up with further growth investments ahead”
In line with its growth ambitions and to strengthen sales activities, the Bank undertook 1,000 net increase in headcount up to 17,742, construction of 54 new branches in 2014 and start/completion of around 130 branch renovations. In addition, deployment/under deployment of approximately 195 ATMs was realised in 1Q14. As of Mar’14, the Bank has 947 branches and 3,025 ATMs. The Bank handles 83% of transactions through its ADCs, one of the highest levels in the sector.
Istanbul, 10 February 2014
Enquiries: Yapı Kredi Investor Relations
Tel: (90) (212) 339 7323
Email: yapikredi_investorrelations@yapikredi.com.tr
Yapı Kredi / 30 Apr 2014