2010 Earnings Release
In 2010, Yapı Kredi reported TL 2.3 bln net income (+45% y/y) confirming robust profitability and enhanced commercial effectiveness driven by strong volume growth, solid fee income, tight cost control and asset quality improvement
On 28 February 2011, Yapı Kredi announced its consolidated 2010 results based on Turkish accounting standards (BRSA), reporting TL 2,255 mln of cumulative net income. Return on Average Equity (ROAE) increased to 26.9% from 22.7% the previous year. Throughout the year, the Bank maintained strong focus on growth, customer satisfaction, commercial effectiveness and profitability, thereby achieving outstanding results in terms of net income growth (45% y/y), cost performance despite continued branch openings (7% y/y in line with inflation), asset quality improvement and above sector asset, loan and deposit growth (29%, 40% and 27%, respectively).
The Bank posted TL 6,649 mln revenues (10% y/y) driven by above sector volume growth, solid fee growth (11% y/y) and asset quality improvement leading to strong collections, compensating net interest margin compression. Cost growth was recorded at 7% y/y on the back of controlled cost management and efficiency initiatives despite continued investments for growth. Cost/income ratio was recorded as 40.5%.
In 2010, Yapı Kredi recorded strong loan growth of 40% (vs sector 34%) driven by macroeconomic recovery, client acquisition and increased commercial effectiveness. On the local currency side, Yapı Kredi further strengthened its position as a leading retail franchise recording robust growth in consumer loans (39%) and SME lending through commercial installment loans (69%). In credit cards, Yapı Kredi maintained its leadership position with 19.8% outstanding volume market share. On the foreign currency side, the Bank concentrated on project finance loans, especially in the energy sector, providing USD 3.6 bln support for the economy.
In 2010, Yapı Kredi recorded solid deposit growth of 27% (vs sector 21%) mainly driven by local currency deposits (39%). The Bank has a solid demand deposit base with weight of demand deposits in total at 17%. Yapı Kredi recorded 17% increase in assets under management and reinforced its #2 position in the sector with 18.4% market share. Yapı Kredi also maintained its leadership position in leasing and factoring with 19.2% and 23.1% market shares, respectively.
Yapı Kredi maintained its comfortable capital position and further strengthened and diversified its funding base in 2010. The Bank successfully secured two syndicated loan facilities in 2010 including USD 1 billion in April 2010 and USD 1.25 billion in September 2010 with more favourable conditions both in terms of amount and pricing compared to the previous year. The Bank also secured a long-term borrowing of USD 750 million with 5 year maturity. Capital adequacy ratio stood at 16.1% at Bank level and 15.4% at Group level.
Yapı Kredi recorded significant improvement in asset quality with NPL ratio decreasing to 3.4% (6.3% in 2009), on the back of decreased non-performing loan (NPL) inflows, strong collections, NPL portfolio sales and credit infrastructure improvements. Specific coverage of NPLs was realised at 77% while general coverage of NPLs was at 40%.
Solid improvement was recorded in commercial effectiveness driven by process / system enhancements leading to decreased customer response times, introduction of innovative new products, focus on customer acquisition, as well as continuous focus on conversion of credit-card only customers into banking customers. Loans per employee increased 39% y/y and deposits per employee increased 28% y/y.
The Bank continued its branch expansion plan with 39 new openings in 2010. As of the end of December 2010, Yapı Kredi has the fourth largest branch network in Turkey with 868 branches and 9.2% market share
Istanbul, 28 February 2011
Enquiries:
Yapı Kredi Investor Relations
Tel: (90) (212) 339 7647
Email: yapikredi_investorrelations@yapikredi.com.tr
Yapı Kredi / 28 Feb 2011