During the first half of 2007, Yapı Kredi reports net income of YTL 401mln and ROE of 23%, as a result of a positive quarter of solid post-merger growth with market share gains in almost all segments vs 1Q07
On 3 August 2007, Yapı Kredi Bank (YKB) announced its first half 2007 results based on Turkish accounting standards (BRSA bank-only), reporting YTL 401 mln of net income (13% QoQ) and ROE of 23% .
YKB’s 1H07 results confirm another positive quarter of post-merger growth following the completion of the integration process in 2006. Performance in the second quarter was marked by market share gains in almost all segments of loans and deposits vs 1Q with the return of commercial focus to the network as a result of segment-focused organisation put in place. While the step up in loan market share was mainly driven by the increase in SME loans, the market share gains in deposits were secured through a strong increase in TL deposits over the first quarter (10% QoQ), constituting 57% of YKB’s total deposits as of June 2007. Through a commercial strategy focused on increasing revenue market share, YKB achieved a healthy revenue growth of 25% YoY on a normalised basis. Capital adequacy ratio (CAR) stood at 12.3% including the impact of operational risk as a result of issuance of Euro 200 mln subordinated loan guranteed by UniCredit in June.
Leadership in the highest yielding credit card business was maintained despite stronger competition (25.2% in outstanding balance). Leveraging on its solid franchise and extensive network strength, YKB had a leading position in mutual funds (#2) (19.1% market share) in addition to being the market leader in non-cash loans, leasing, factoring, private pension funds(1) and non-life insurance(1). With total assets of 48 bln YTL, YKB currently ranks as the 4th largest private bank in the sector by asset size, with total performing loans of 24 bln YTL and total deposits of 32 bln YTL.
As a result of 23 new branch openings in 2Q07 as a first step of recently announced accelerated branch opening plan, total number of branches of YKB reached 638.
Cost/income was reduced to 60%(2) (-7ppts YoY) (50% if cost base adjusted for IFRS). NPL ratio declined to 6.8% (-0.7 ppts vs 1Q) excluding the new regulation impact (6.5% including), with 80.5% NPL provisioning coverage.
On 13 July, YKB received early repayment of US$480 mln from Çukurova which will lead to a debt reduction to US$258 mln. On 23 July, 90.91% of share exchange ratio was announced for transferring YK Leasing, YK Factoring and YK Azerbaijan from KFS to YKB which is expected to result in 1.6% increase in KFS ownership up to 81.8%. Subject to BRSA and CMB approvals, completion of KFS restructuring is targeted within 2007.
(1)Through Koç Allianz which is not a KFS subsidiary (Koç Group subsidiary)
(2)Adjusted by loan write-off, mainly from Superonline. Unadjusted, 64%
İstanbul, 3 August 2007.
Enquiries:
Yapı Kredi Investor Relations
Tel: (90) (212) 339 7647
Email: yapikredi_investorrelations@yapikredi.com.tr
Yapı Kredi / 03 Aug 2007