2022 Integrated Annual Report
Together we are
We are in deep sorrow and heartbreak due to the earthquake disasters in
February 2023, in which we suffered immense losses as a country.
We wish God's mercy to our valuable colleagues, elders and all our citizens we
lost, and we extend our condolences to their relatives and our nation.
We are Together, You are not Alone...
Islahiye-Gaziantep Branch
Retiree
Antakya-Hatay Branch
Retiree
Antakya-Hatay Branch
Küçük Sanayi Sitesi- Kahramanmaraş Branch
Antakya-Hatay Branch
Islahiye-Gaziantep Branch
Samsun Branch
Retiree
Kahramanmaraş
Retiree
Küçük Sanayi Sitesi- Kahramanmaraş Branch
Çukurova Regional Directorate
Retiree
Kahramanmaraş Branch
Retiree
Kahramanmaraş Branch
İskenderun-Hatay Branch
Retiree
Kahramanmaraş Branch
Retiree
Çukurova Regional Directorate
Retiree
You are in our hearts...
4 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 5
Content
5
6
8
10
11
Introduction
About the Report
An Overview Of İşbank
Corporate Profile
Our Vision, Values,
Strategic Goals and Strategy
12 Why İşbank? Highlights in 2022
14
İşbank from 1924 to Today
16 Messages from the Executives
20 Looking Into the Future
Global Tendencies, Risks, Opportunities and Forecasts
23
28 Message from the Sustainability Leader
30 Management Evaluation and Analysis
31
How Do We Create Value?
Sustainability at İşbank
Sustainability Management
32 Our Business Model
34
35 Our Stakeholders
38 Materiality Process at İşbank
46
47
50
İşBank's Sustainability Journey
Initiatives Supported in the Field of Sustainability
Contribution to Sustainable Development Goals
52 Reliable Financial Actor
An Inclusive and Robust Economy
Financial Performance and Profitability
İşbank and its Activities in 2022
İşbank's Subsidiaries
Customer Centricity
Responsible Products and Services
Financial Literacy
Financial Inclusion
Climate Action
Climate Change Risk Management
Environmental and Social Risk Management in Loans
Products and Services Contributing to a Green Economy
54
57
59
64
65
68
71
72
76
78
82
84
88 Next-Generation Banking
90
99
Digital Banking
Information Security at İşbank
102 Responsible Operations
Employee Loyalty and Satisfaction
104 Reducing Negative Impacts of Operations
108 Environmental Impact Management
109 Environmentally Friendly Buildings
110 Responsible Procurement
114 Decent Work
117
118 Employee Rights
119 The Future of Business and New Working Models
121
Equal Opportunity, Diversity and Gender Equality
124 Compliance with Operating Principles
125 Employee Health and Safety
125 Preferred Employer
126 Talent Management
128 Good Corporate Citizen
130 Transparent and Ethical Management
133 Management Structure
134 Board Member Matrix
136 Board of Directors
140 Executive Board
142 Organization Chart
144
144
149
Information on Board of Directors Meetings in 2022
İşbank Committees
Information on Risk Management
Policies Applied per Risk Types
153 Managers of Internal Systems
154 Audit Committee’s Assessment on the Operation of Internal
Audit, InternalAudit, Compliance and Risk Management
Systems, and its Activities in the Reporting Period
160 Business Ethics
161 Anti-Bribery and Anti-Corruption
162 Corporate Governance Principles Compliance Statement
162 Corporate Governance Compliance Report
166 Corporate Governance Information Form
174 Sustainability Principles Compliance Framework
Annual Meeting Documents
179 Dividend Distribution Policy
180 Summary Report of the Board of Directors
181 Ordinary General Assembly Meeting
182 Profit Distribution Proposal
184 Contribution to Social Welfare
186 Projects in the Education Field
188 Projects in the Environmental Field
188 Projects in the Culture and Art Field
190 Financial Report
198 Non-Consolidated Financial Report
306 Consolidated Financial Report
418 Annexes
Introduction
Preparing to celebrate its 100th anniversary in 2024, İşbank has adopted the principle of providing
continued support to the country's economy and generating solutions to social problems since the
day it was founded. In the 2022 Integrated Annual Report, making its stakeholders feel that they are
part of a big family by utilizing all its means in all kinds of difficulties, İşbank has presented to all its
stakeholders what type of value it creates for our country with the slogan "Together we are".
İşbank 2022 Integrated Annual Report summarizes the value created by the Bank for its stakeholders in four main sections.
"How Do We Create Value?"
"Reliable Financial Actor"
section explains İşbank's value creation process
through İşbank Banking, which manifests the Bank's
integrated sustainability approach. This section
includes the sustainability priorities revised with the
“double materiality” approach in 2022, sustainability
initiatives supported, communication with
stakeholders, and contribution to the United Nations
Sustainable Development Goals.
section presents the role that İşbank plays as a
financial organization for an inclusive and robust
economy. This section includes İşbank's goals for
a sustainable financial performance, the customer
experience that İşbank considers while presenting
its products and services, and its performance
in inclusion, financial literacy, and raising savings
awareness. İşbank’s roles and goals in climate action
and the Bank's digitalization journey are also reported
under this heading.
"Responsible Operations"
"Good Corporate Citizen"
section sets out the projects and practices
developed by İşbank to minimize the negative
environmental impacts of its operations and spread
the working standards it has adopted throughout the
supply chain. The section also reports on İşbank's
employer approach, working life practices, and how
İşbank employees are prepared for the future of
business.
section summarizes the Bank's corporate governance
structure, ethical and principled banking approach,
effective risk management for short and long-term
threats, and management principles and performance.
The “Social Investments” section summarizes İşbank's
vision of social responsibility and social welfare
projects realized with this vision.
Various voluntary
and compulsory
performance disclosures
to which İşbank is
subject are included
in the “ANNEXES”
section.
Although 2022 was a challenging year for both our country
and the global economy, İşbank completed this turbulent
period with successful results. The Bank shall continue
to observe the economic, social, and environmental
dimensions of its actions together and take responsibility for
the country's economy as a reliable institution.
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen
6 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 7
About the Report
İşbank’s 2022 Integrated Annual Report has been prepared
to demonstrate the Bank’s performance in line with its
strategies and the value created for its stakeholders.
The report also includes İşbank's contribution to the United
Nations Sustainable Development Goals.
See Contribution to Sustainable Development Goals
İşbank’s annual report set
Structure and content of the report
The second integrated annual report of İşbank provides
up-to-date information about the Bank's efforts undertaken
within its approach focusing on creating sustainable and
shareable value by considering financial and non-financial
capital elements as a whole. The 2022 Integrated Annual
Report includes İşbank’s 2022 performance in line with its
strategies, the value created for all its stakeholders with this
performance, and the risks and opportunities it faced in the
value creation process.
Period and scope of the report
İşbank 2022 Integrated Annual Report presents the Bank's
performance for the period between January 1st, 2022
and December 31st, 2022. The Integrated Annual Report,
which includes consolidated and unconsolidated financial
statements and independent audit reports, comprises
İşbank's activities in Türkiye and abroad. The activities of the
Bank's subsidiaries are excluded from the scope of reporting.
However, a brief summary of subsidiary performance is
included in the report. See İşbank's Subsidiaries
Compliance and legislation
İşbank, the shares of which are publicly traded on the
Istanbul Stock Exchange, ensures that the Bank's 2022
Integrated Annual Report is in compliance with the minimum
requirements of the Banking Regulation and Supervision
Agency (BRSA) and the Capital Markets Board (CMB) on
annual reporting.
The İşbank Integrated Annual Report has been prepared
in compliance with the Integrated Reporting Framework
( Framework) of the International Integrated Reporting
Council (IIRC) and GRI Universal Standards 2021 published
by the Global Reporting Initiative (GRI).
See GRI Standards Content Index
While creating the report;
ᆔThe Provisional Standard for Commercial Banks Guide
released by the Sustainability Accounting Standards Board -
SASB,
ᆔUnited Nations Environment Program Finance Initiative (UNEP
FI) Principles of Responsible Banking guideline (PRB),
ᆔCarbon Disclosure Project’s (CDP) Climate Change and Water
Security Programs guidelines,
ᆔWorld Economic Forum (WEF) Stakeholder Capitalism Metrics,
ᆔBloomberg Gender Equality Index Indicators and
ᆔTask Force on Climate-related Financial Disclosures (TCFD)’s
recommendations were utilized in developing the content.
İşbank, a signatory of the United Nations Women's
Empowerment Principles (UN WEPs), has prepared a more
detailed performance summary on gender equality.
See Women's Empowerment Principles Progress
Statement
Audit
The financial statements included in İşbank's 2022 Integrated
Activity Report have been audited by Güney Bağımsız Denetim
ve SMMM A.Ş. See Compliance Opinion
KPMG Bağımsız Denetim ve Serbest Muhasebeci Mali
Müşavirlik A.Ş. has provided limited assurance on selected non-
financial information. See Independent Assurance Report
İşbank's Environmental Management System has been audited
within the scope of ISO 14001: 2015 standard under DAkkS
accreditation by TÜV SÜD.
Senior management responsibility
statement
In the opinion of İşbank's top management, this report includes
all the subjects in terms of value creation for the Bank's
stakeholders while presenting a holistic evaluation of the
Bank's financial and non-financial performance for the period
between January 1st, 2022 and December 31st, 2022, and its
plans for the future.
The statement of responsibility regarding this report has been
prepared as per the relevant legislation and presented on
the KAP platform. The statement can be found on the Bank's
corporate website.
Contact
The integrated annual report, which we aim to make
accessible to all our stakeholders, can be accessed
via the Public Disclosure Platform (KAP) and
on www.isbank.com.tr.
Please send your opinions and suggestions on the report
tosustainability@isbank.com.tr.
Report’s Navigation
The ✓mark represents the non-financial data that passed
the independent audit. ✓⃝symbolizes completed projects,
symbolizes ongoing projects. You can go back to the
“Table of Contents” page of the report with the
The symbol refers to information on the website, while the
symbol refers to information in another section of the report.
symbol.
Integrated Annual Report: This report
summarizes İşbank's performance, strategies
and targets, and financial and non-financial
components from an integrated perspective.
Capital Markets Board – Sustainability
Principle Compliance Framework: This report
summarizes İşbank's sustainability strategy,
management structure, performance and targets
within the scope of CMB requirements.
Capital Markets Board – Corporate
Governance Compliance Report: This report
shows that İşbank conducts its operations in
compliance with the compulsory principles of the
Corporate Governance Communiqué published by
the Capital Markets Board.
Carbon Disclosure Project (CDP) Climate
Change Program Report:
This report summarizes İşbank’s targets and
strategies developed for climate action and its
annual performance within the framework of CDP
Climate Change Reporting indicators.
Carbon Disclosure Project (CDP) Water
Security Program Report:
This report summarizes İşbank's water risks, its
targets and strategies in this area, and its annual
performance within the framework of CDP Water
Security Reporting indicators.
All annual reports published by İşbank
are available at www.isbank.com.tr
or by contacting the Investor Relations
and Sustainability Division.
UNEP-FI Principles for Responsible Banking
Report: This report presents the impact
assessment of İşbank's portfolio within the scope
of the Principles for Responsible Banking, of which
İşbank is a signatory.
UN Global Compact - Communication on
Progress Report (CoP): This is the report in which
İşbank transparently shares its commitment to the
10 principles of the United Nations Global Compact
and its social and environmental performance.
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 01
An Overview
Of İşbank
10 Corporate Profile
11 Our Vision, Values,
Strategic Goals and Strategy
12 Why İşbank? Highlights in 2022
14
İşbank from 1924 to Today
16 Messages from the Executives
10 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 11
Corporate Profile
İşbank is a leading financial institution in
its sector, operating for 98 years in line
with its vision of developing innovative
products, services and applications that
meet the banking expectations of the
future with its strong financial structure.
As of the end of 2022, with its 23,309 employees
providing services to 22.8 million customers, İşbank is
the largest private bank in Türkiye, with a total asset size
of TL 1,408.3 billion. İşbank is amongst the most highly
respected institutions of the banking sector with its
products and services in corporate, commercial, SME,
retail and private banking.
İşbank provides services to its customers with 59
Regional Directorates and 1,110 branches in Türkiye, in
addition to the Head Office in Istanbul, Tuzla Technology
and Operations Center (TUTOM), Tuzla Atlas Data
Center, and Ankara Operations Center (ATOM).
Providing services through its branches and digital
channels developed as a result of huge investments,
İşbank continues to create value for its stakeholders
through our Internet Branch, İşCep (the mobile app),
Call Center, 6,169 ATMs, and 611,429 POS devices
(including online POS) in Türkiye, TRNC, and abroad.
İşbank operates its cross-border banking activities with
2 branches in Iraq, 2 branches in Kosovo, 2 branches
in England, 1 branch in Bahrain and 14 branches in
Northern Cyprus as of the end of 2022. The Bank has 2
representative offices, one in Shanghai (China) and one
in Cairo (Egypt). İşbank operates its banking activities
via its subsidiaries in Germany, Russia, and Georgia.
İşbank Group is an integrated organization with
domestic and international subsidiaries operating in
many fields. As of the end of 2022, İşbank has direct
and indirect subsidiaries with 136 companies. The
number of companies controlled directly or indirectly by
the Bank is 113.
See İşbank's Subsidiaries
You can find the history of İşbank here.
İşbank’s Shareholding Structure**
See Amendments to the Articles of Incorporation
Atatürk's Shares*
28.09%
Free Float:
34.60%
22 .8 mıllıon ✓
Customers
23,309 ✓
Employees
TL 1,408.3 Bıllıon
The largest private bank in Türkiye
with its total asset size
Türkiye İş Bankası A.Ş.
Members' Supplementary
Social Security and Charity
Fund Foundation
37.31%
* These shares belong to Atatürk and are represented by the Republican
People's Party in accordance with Atatürk's will. Since the dividend
income of these shares was left to the Turkish Language Association
and Turkish Historical Society in accordance with Atatürk's will, dividend
payments are made to the aforementioned institutions within the
framework of the will and legal legislation.
**The shareholding structure has been included as of 31.12.2022.
(31.12.2021: Foundation: 37.26%, Atatürk's Shares: 28.09%, Free Float:
34.65%).
Our Vision, Values,
Strategic Goals and Strategy
Our Vision
Our Values
Our Strategy
Becoming the bank of the future,
creating sustainable value with
an inclusive and participatory
approach
Innovation, Solidarity, Common
Sense, Reliability, Sincerity,
Transparency guided by the
principles of "Intelligence,
diligence, integrity, technical and
methodical work"
Managing our balance sheet to ensure
sustainable and value added growth while
using our internal and external resources
in accordance with the priorities of the
country's economy and getting prepared
for the future by continuously improving
our business model in synergy with our
group companies and all our business
partners in the period of technological
transformation.
Our Strategic Goals
Commitment to our country � Strong and sustainable financial performance � Effective risk
management � Flawless customer experience � Value creating technology and innovation
leadership � Happy and productive human resources � Ethical and responsible banking,
compassionate towards people, society and environment
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 12 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 13
Why İşbank?
Highlights in 2022
52.0%
increase
TL 1,408.3 billion
Asset Size
TL 759.3 billion
Cash Loans
53.9%
increase
56.3%
increase
TL 931.1 billion
Deposits
TL 191.4 billion
Shareholders' Equity
120.4%
increase
48.4%
increase
TL 423.4 billion
Demand Deposits
LEADER AMONG
PRIVATE BANKS
TL 61.5 billion
Net profit
TL 127.7 billion
Market value
TL 6.15
Profit per share
22.8 million✓
customers
1,110 domestic,
21 foreign branches
6,169
Bankamatik ATMs, the largest
ATM network among private
banks
13 million✓
digital banking customers
Commitment to
phase-out coal and
natural gas
First Turkish Bank that
does not finance gold
mining activities using
cyanide
30% Club membership
25.4 million
users served by Bankamatik
ATMs, including customers of
other banks
4,371 million
customers interacted with İşCep
Expenditures area
2.7 million
social media followers
1.90%✓
employee turnover rate
43✓ hours
average training time
per employee
97.09%
ratio of Local Suppliers
2.8 million
Maximum Mobile users
73.2%
share of İşCep in transactions
conducted through all
channels
11.9 million
İşCep users
96.2%
ratio of transactions out of total
transactions made through
non-branch channels at İşbank
27,994 person*hours✓
sustainability training provided to
employees
97.5%✓
unionization rate
30,000
chess classes opened
in schools in total
55%✓
ratio of female employees
42.6%✓
ratio of women in management
99.7%✓
ratio of return from
maternity leave
75%
renewable energy projects/
Energy generation portfolio
TL 2.3 billion
sustainable investment fund
9%
ratio of female and male salary gap
(according to female/male median
values)
98.1 million MWh
the amount of clean energy
generated through the projects
financed by İşbank in the last
3 years
International commitment
to transition to a carbon-
neutral economy: Net-Zero
Banking Alliance (NZBA)
Diversity Policy under the
ownership of Board of
Directors
CDP Climate Change
Report Score “A-”
CDP Water Security Report
Score “B”
Sustainalytics ESG Risk
Rating 18.6 Low Risk
Listed in the Bloomberg
Gender Equality Index
İşbank is in the BIST
Sustainability 25 Index
Ranked 4th among 1,097
global banks in Refinitiv
reporting by the end of
2022
One of the two
companies in Türkiye
Participating in the UN
Global Compact “CoP -
Early Adopters Program”
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 14 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 15
İşbank from
1924 to Today
1920s-1930s
İşbank, the first national bank of the
Republican era, was established
on August 26, 1924, in line with the
decisions taken at the Izmir First
Economics Congress with Atatürk's
directives.
Beginning to expand into a country-
wide branch network upon its
foundation, İşbank was the first
Turkish bank to establish branches
abroad, with the first international
branches opened in Hamburg,
Germany and Alexandria, Egypt in
1932.
1950s
The Bank developed its portfolio
of subsidiaries. As the Bank's
subsidiaries became the driving
force of Turkish industry, the Bank
invested in and financed a number
of industries, with a focus on
manufacturing.
1980s
In the 1980s, İşbank increased
the number of its overseas
branches. At İşbank, the 1980s
were characterized by the growing
importance of multichannel banking,
and the Bank started offering an
even broader range of products to its
customers.
In 1982, İşbank introduced the
first ATMs to Türkiye, and its ATMs
named "Bankamatik" became a
brand.
1960s-1970s
In the 1960s and 1970s, İşbank
focused on extending its branch
network.
1990s
İşbank further solidified its
position as the sector's pioneer in
alternative distribution channels
when it launched "Mavi Hat (Blue
Line)" in 1991 and the first online
banking branch in 1997.
2010s
Initiating the customer-centered Digital
Transformation Program with the vision of
becoming "Türkiye's Best Digital Bank", İşbank
founded MaxiTech, its subsidiary, in Silicon
Valley, the USA in 2016 to support digital
transformation.
İşbank advanced one step further in the
innovation universe with the opening of the
Shanghai Innovation Center.
With TekCep service, Türkiye's first open
banking app, the Bank offered an opportunity
to track account activity at different banks via
İşCep.
The "Workup by İşbank" Entrepreneurship
Program was initiated in order to support high
potential and technology-focused initiatives
(Startups). By committing to invest in the Maxis
Innovative Venture Capital Fund established within
the İşbank Group, the Bank started to invest in
technology-focused startup ventures. In addition,
the "Innovation Committee" was established at
İşbank in order to extend the innovation culture and
ensure the continuation of innovation processes.
In 2018, İşbank continued to consolidate its
leadership in digital banking by integrating the
personal assistant application Maxi into the
service platform, which quickly achieved a record
number of customer contacts.
2000s
Maintaining strong and stable growth,
İşbank relocated the Bank's headquarters
from Ankara to Istanbul in 2000.
In 2006, İşbank initiated the Customer-
Oriented Transformation Project and
aimed at restructuring a customer-
focused approach in line with its strategic
goals. As a result, the Bank successfully
completed many projects, which was
referred to as a structural revolution.
In light of rapid advances in technology,
İşbank continued to improve the
innovative multichannel banking network,
allowing customers to utilize the most
suitable channel to perform all banking
transactions conveniently, quickly and
reliably on a 24/7 basis.
İşbank joined the United Nations Net-Zero
Banking Alliance (NZBA) and committed
internationally to increase its support for
the transition to a carbon neutral economy.
In line with its vision of being the bank
of entrepreneurship and entrepreneurs,
the Bank launched entrepreneurship
branches, the first startup-focused
branch service model in Türkiye.
İşbank played an active role in the
establishment of the Arya Venture
Capital Fund, which aims to invest in
gender-balanced startups and the
FounderOne Venture Capital Fund, which
aims to invest in startup impact initiatives
and joined the Funds by making an
investment commitment.
Nays, a mobile finance application that
enables users to perform their daily
financial transactions with an easy and
enjoyable experience and constantly
rewards them, was launched.
2020s
In this extraordinary period under
COVID-19 pandemic conditions, İşbank
demonstrated its support to households
and companies through special product
and service applications.
The Bank maintained funding from
international markets and further
increased its support to the Turkish
economy. Agriculture-focused activities
gained momentum.
You can access the history of İşbank here.
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 16 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 17
Message from the
Chairperson
Esteemed Stakeholders,
We started 2023 with great sorrow due to the
earthquakes that shook our country deeply. As a
nation, we feel the deep pain of losing our citizens
in the successive disasters that affected a vast area.
Unfortunately, our six colleagues working in branches
in the region lost their lives in this tragic disaster. In
this period when our greatest wish is to quickly heal
our wounds, we, as the İşbank Group, have utilized our
means and unveiled a strong aid package to provide
comprehensive assistance to all those impacted by the
disasters.. I would like to take this opportunity to once
again share my wishes for the recovery of our country,
wish Allah's mercy on our citizens who lost their lives, and
express my condolences to their relatives and our nation.
In 2022, the risks and uncertainties caused by the
Russia-Ukraine war on the world economy, especially
on European countries, were at the top of the agenda.
While the disruptions in supply chains for basic needs
such as energy and food due to the war increased global
inflationary pressures, major central banks took steps to
tighten their monetary policies faster than expected to
combat inflation. These steps led to a loss of momentum
in economic activity in the last months of the year, causing
global recession concerns to be expressed. In addition,
as the global risk appetite decreased in 2022, portfolio
investments in emerging economies followed a fluctuating
course during the year.
In 2022, Turkish economy grew by 5.6% on an annual
basis with the strong contribution of consumption
expenditures and moderate contributions of exports
and investments. On the other hand, the rise in global
commodity prices, particularly energy, caused the current
account deficit to widen despite the rapid recovery in
tourism revenues and inflationary pressures to increase.
Annual CPI inflation hit its highest level of the last 24 years
in October and then started to decline due to the high base
effect.
The Turkish banking sector maintained its strong outlook
and continued to support economic activity despite the
rising volatility in financial markets.
Despite the global economic turmoil and the challenging
economic conjuncture, as İşbank, we completed 2022
achieving successful results and reaching our targets.
The most important component of our solid financial
performance is our long-term perspective, in which we
consider both financial and non-financial capital elements
together. As we prepare to celebrate our 100th anniversary
in 2024, we work with the responsibility of being a reliable
companion for all our stakeholders.
We are an organization that has integrated sustainability
into all processes, turned it into a corporate culture, and
performed at international standards in this field. We continue
to operate with an integrated sustainability approach at
every stage, from product development to recruitment
and promotion, from audit to social responsibility initiatives
and procurement processes. We evaluate the social,
environmental, and economic impacts of all our projects
together and make solid cost and benefit calculations.
As a result of the performance achieved with this holistic
perspective, our Bank continued to gain the appreciation
of various domestic and international organizations in
2022 as well. We were honored with the “Bank of the Year
in Türkiye” award by The Banker Magazine published by
“The Financial Times,” one of the world’s leading financial
and economic media. Our strong financial performance, as
well as our constant innovative service approach focused
on creating value for customers in the field of digitalization
and innovation, and the initiatives we undertake for society
were effective in winning this award. We were also named
the best digital bank in Central and Eastern Europe by
Euromoney, one of the most prestigious publications in the
field of global finance and banking.
In 2022, we fulfilled our commitments in the field of
sustainability and added new ones to our existing
commitments. We committed internationally to support
the transition to a carbon neutral economy by becoming
a member of the Net-Zero Banking Alliance (NZBA),
established by the United Nations to ensure that member
banks align their portfolios with net-zero emission targets
in line with the Paris Climate Agreement by 2050.
For 98 years, İşbank has been an institution that fulfills its
social responsibilities without interruption, regardless of
economic and social conditions. In 2022, we signed an
important collaboration and became the official supporter
of the Turkish National Olympic Committee for the 2024
Paris Olympics. With this collaboration, we aim to provide
young people with more opportunities to prepare for the
Olympics, as well as to give children the habit of sports,
to introduce children to Olympic values at an early age,
to have more young people represent our country at the
Olympics, and to increase our achievements. We are
very happy to support this important organization, which
coincides with the 100th anniversary of our Bank and aims
to be climate positive and contribute to gender equality. We
believe that together we will achieve successes that will
make us all proud and happy.
In 2022, we sponsored the Marmara Sea Symposium to
become part of the solution to marine pollution, one of the
most significant environmental issues in our country. At
the Marmara Sea Symposium organized by the Turkish
The 100th anniversary of the Republic
means more than this for İşbank. It is an
institution that meets on the common
ground of independence with our Republic
and that will experience the enthusiasm of
its 100th anniversary one year apart.
Adnan Bali
Chairperson
Marine Research Foundation (TÜDAV), topics such as
mucilage, pollution, biodiversity, fisheries, earthquakes, the
Turkish Straits, and maritime transport were discussed
comprehensively by experts from different disciplines, and
solutions were presented.
Another of our prominent initiatives in the field of
environment is the “Deniz Kâşifi (Sea Explorer)” project.
In cooperation with the Middle East Technical University
(METU) Institute of Marine Sciences to support scientific
and academic studies on life in the seas, a specially
produced unmanned underwater glider device called
“Deniz Kâşifi”, was provided to and will be used for the first
time in Türkiye by the Institute of Marine Sciences at METU.
The device, which will support scientific and academic
studies on marine pollution in Türkiye, will enable scientific
and academic studies on the seas to be carried out more
efficiently and on a larger scale.
We extended our cooperation with the Turkish Chess
Federation (TSF), which we have been supporting as the
main sponsor since 2005, for another 5 years in order to
introduce chess to more children in our country and to
make chess widespread and easily accessible. Under the
Bank’s sponsorship, chess has become the sport with
the highest number of licensed players in the country. As
a result of our partnership, which started 17 years ago, in
addition to achieving countless international achievements,
hundreds of thousands of our children and young people
were introduced to chess and brand new worlds were
created by reaching disadvantaged groups. In the upcoming
days, in addition to the chess classes opened in primary
and secondary schools across Türkiye, by including the
preschool program within the scope, we aim to introduce
chess to our children starting their education life.
Esteemed stakeholders,
In 2023, our Republic, which was founded by Gazi Mustafa
Kemal Atatürk and his fellow fighters by rising from the
ashes of a nation struggling for existence, will be a century-
old sycamore. The 100th anniversary of the Republic
means more than this for İşbank. It is an institution that
meets on the common ground of independence with our
Republic and that will experience the enthusiasm of its
100th anniversary one year apart.
İşbank and its subsidiaries are a large community that
supports Türkiye’s sustainable growth and development
with the products and services they offer for export and
production as well as the employment they create. Our
Bank supports the real sector and households with its
nationwide service network and digital contact points.
In our second century, our Bank will continue to use its
resources for Türkiye with determination.
İşbank will continue to be a reliable companion for its
customers, business partners, and all stakeholders in a
period when the global economy becomes more fragile
and complex, income inequality is increasing day by day,
and the negative impacts of climate change and loss of
biodiversity are being felt more and more. Our Bank will
continue to support the real economy and households by
bringing the strength it derives from its deep-rooted history
and principles together with up-to-date technologies. On
behalf of the Board of Directors, I would like to thank all our
stakeholders, especially İşbank employees, who are the
architects of our success with their efforts.
Yours sincerely,
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 18 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 19
Message from the CEO
Esteemed Stakeholders,
Following the Kahramanmaraş-centred earthquake disasters
that devastatingly affected many surrounding provinces, we are
living through very difficult times in which we are deeply shaken
up as a country and put to the test with human life. I believe that
we can overcome these difficult days of great pain only by joining
hands together, and I would like to take this opportunity to once
again express my condolences and best wishes for our nation.
The solidarity we have shown since the first day, and every helping
hand we extended to those struggling to survive, gladden our
hearts to some extent. As İşbank, we shoulder the responsibility
for our country today, as in the past, and we are helping to heal
the wounds with a very comprehensive aid package. I believe that
united together, we will overcome these diffucult days that our
country is going through after the earthquakes as soon as possible.
The year 2022 was marked by an increase in global commodity
prices, especially energy, and consequently rising inflation
worldwide, with the impact of the tension between Russia and
Ukraine. The world economy, which recovered rapidly after
the pandemic in 2021, grew at a slower pace than anticipated
throughout the year as the tension between the two countries
turned into a hot conflict in February 2022. International
organizations revised their global growth forecasts downwards
and inflation expectations upwards during the year. According
to IMF data, the slowdown trend in the world economy, which
is estimated to have ended 2022 with a growth rate of 3.4%, is
predicted to continue in 2023 due to the tightening steps taken
by major central banks to fight inflation.
In 2022, the Turkish economy continued to grow, albeit losing
momentum compared to the previous year, thanks to strong
domestic demand and moderate contributions from net exports
and investments. In this period, global inflationary pressures, as well
as the lagged impacts of the depreciation in the Turkish lira, caused
inflation to remain high. Despite the strong performance in tourism
revenues, the widening in the foreign trade deficit in parallel with
rising commodity prices on a global scale led to a rapid increase in
the current account deficit. On the other hand, the robust course of
economic activity and the high inflationary environment led budget
revenues, particularly tax revenues, to increase sharply, keeping the
budget deficit below the year-end target.
In 2022, when risk perception followed a volatile course, the
Turkish banking sector continued to support economic activity
by successfully managing risks with its robust financial structure.
Having the pioneer position in the sector, İşbank consolidated its
position in the sector by realizing a performance that significantly
exceeded its targets in 2022, when uncertainty was at the
forefront. In 2022, our asset size reached TL 1,408.3 billion
with an increase of 52.0% compared to the previous year; the
cash loans we extended in the same period increased to TL
759.3 billion and non-cash loans to TL 246.7 billion, and our
total contribution to the economy was TL 1 trillion in the same
period. While leaving behind a successful year, in addition to the
soundness of our financial structure, we addressed digitalization,
sustainability, competent human resources, customer experience,
and subsidiary strategy as a whole with an integrated perspective.
Together to Our 100th Anniversary
In 2023, our Republic, founded by the Great Leader Mustafa
Kemal Atatürk, will turn 100 years old. One year later, İşbank will
celebrate the 100th anniversary of its foundation. We continue
to create value for all our stakeholders in line with our vision of
“becoming the bank of the future, creating sustainable value
with an inclusive and participatory approach”. We have set the
theme of our Integrated Annual Report for 2022 as “Together to
our 100th anniversary,” in which we aim to transparently explain
how we created value from our activities as well as our goals for
the future. Accordingly, we will continue to support the national
economy by resolutely implementing a healthy growth strategy
with the support of our robust financial structure and quality service
delivery. We are building the bank of the future with our business
model, organization and branch structure, service approach, the
competence of our employees, and our technological infrastructure.
Corporate Commitments for Sustainability
In 2022, our efforts to fight climate change, which is one of
the leading global problems, have continued at an accelerated
pace. We added a new one to our international commitments in
this area, and as a signatory of the Net-Zero Banking Alliance
established by the United Nations, we committed to aligning
our loan portfolio with net-zero emission targets on a scientific
basis by 2050 in line with the Paris Climate Agreement. In order
to reach net-zero targets, we also added to our goals to support
our customers' transition processes to a net-zero economy by
focusing our 2030 targets on carbon-intensive sectors and to
report and publish our progress in emission targets on an annual
basis. Joining the Net-Zero Banking Alliance will further increase
our effectiveness in fighting climate change.
We evaluate climate change topics not only in terms of reduction
and adaptation but also in terms of the opportunities created
for green transformation. In this regard, our Bank continues its
efforts to offer its customers both product and service packages,
as well as to provide consultancy. Until 2026, we are committed
to contributing to the green transformation of the economy by
providing sustainable financing amounting to TL 300 billion.
We support women's participation in business life and continue
to offer the necessary financial and non-financial solutions
to women entrepreneurs, who are an important dynamic in
sustaining economic and social development. Starting from 2023,
we are committed to providing financing support of TL 100 billion
to our women entrepreneurs within 5 years. In 2022, we launched
a new project called WeLead (Leading Women Entrepreneurship
for Accelerating Development) in cooperation with TÜRKONFED
and with the support of UN Women to improve the capacities
of women entrepreneurs and strengthen their communication
networks. Within the project, our efforts to provide training support
to entrepreneurial women will continue regardless of sector and
scale in 2023 as well. As an indication of the importance our
Bank attaches to gender equality, we became a member of the
30% Club, a cooperation in which the chairpersons of the board
of directors and general managers aim to improve the gender
balance at all levels of their organizations and to increase the ratio
of women in the boards and senior management to 30%.
In the field of agriculture, we support sustainability in agriculture
with digital solutions to create a positive impact on food safety
and resource efficiency. In line with our Bank's targets within
the framework of the effective use of agriculture, finance,
and technology together, and the theme of sustainability, we
established the Agricultural Banking Advisory Board, which is
comprised of experts who have made a difference in agriculture
and related fields, under the leadership of our Bank. To share our
perspective on agricultural banking with farmers and to establish
more effective communication with them, we launched agriculture
specialized branches. We held the first Imece Workshops, which
Preparing to celebrate its 100th anniversary,
as an institution with deep-rooted corporate
values and always looking out for the
interests of its country, our Bank has turned its
compass towards the principle of sustainable
profit for all in these turbulent times.
Hakan Aran
Chief Executive Officer
aim to bring together different stakeholders of the ecosystem
under agriculture-specific topics and develop solutions together
to the problems identified, with the theme of “Water” in October
2022 and the second one in December with the theme of
“Wheat”. In 2022, we continued to increase the financial and
digital literacy of our farmers and support their agricultural
activities with our mobile application İmeceMobil, which has
become a platform specific to the agricultural sector.
Bank of the Future
As part of our efforts to build the Bank of the Future, we continue
to invest in technology, digitalize our processes, and offer our
customers easy, fast, and secure experiences. With this approach,
the number of İşCep users exceeded 11.9 million, and the rate
of digital transactions exceeded 96 percent. We launched Nays
in 2022 in order to meet the daily financial needs of the young
population with high financial technology adaptation and a variety
of experience expectations, all while providing a simple and easy
experience. Offering advantageous shopping and money transfers,
Nays reached more than 1 million users in a short time.
Within our strategy to design the bank of the future and
corresponding customer experience, we launched İş Mekan, a
Next-Generation Customer Contact Point, with the aim of reaching
our customers, who we contact digitally, in the physical world
as well and offering multiple value propositions by meeting their
needs more holistically without limiting them to banking processes.
Support for Entrepreneurship
Our Bank, which has supported entrepreneurs since the first
years of its establishment, maintains its effectiveness in the
entrepreneurial or entrepreneurship ecosystem with a broad
perspective.
In 2022, we collaborated with the Vehbi Koç Foundation for
initiatives that focus on a more livable world. Within this scope, we
launched the “Impact Entrepreneurship Program” for initiatives
that act with the vision of creating a new world by scaling social
and environmental impact with technology. The 9th term startups
of the Workup Entrepreneurship Program, of which we are the
main supporter and which has been continuing uninterruptedly
for 5 years, and the 1st term startups of the Workup Agri
Entrepreneurship Program, which was launched in 2021 under the
roof of Workup, graduated in 2022. To date, 35 Workup startups
have made a significant contribution to the national economy by
receiving an investment of approximately USD 12 million during or
after the program. Also, in the coming period, we aim to deepen the
Workup parent brand by focusing on different verticals.
In 2022, we also opened our second Entrepreneurship Branch
in Izmir in cooperation with İzQ. Our branch, which differs
from traditional banking activities, was designed to serve
entrepreneurs and ecosystem stakeholders.
As a Bank that believes in a collective working culture and shared
wisdom and internalizes these values, we always act with a “people
first” approach. We strive to implement the most up-to-date
practices in order to keep going as an institution where employees
can realize their potential and are proud to work.
To this end, in 2022, we continued with projects related to working
life as well. We have made progress in agile areas, which are
important transformation areas. We continued our investments to
implement next-generation working models, which have become
widespread especially after the pandemic, and we made the hybrid
working model open to all our employees.
In 2022, with the widespread use of remote working in corporate
life, our employees started to serve free from a location in Maxiofis
environments, and the aim is to enhance Maxiofis working
environments.
Esteemed Stakeholders,
In the face of fluctuations in the global economy, the impacts of
the climate crisis, and increasing social and economic inequalities,
İşbank is positioned as an inclusive business partner. Preparing to
celebrate its 100th anniversary, as an institution with deep-rooted
corporate values and always looking out for the interests of its
country, our Bank has turned its compass towards the principle of
sustainable gain for all in these turbulent times. Undoubtedly, the
Bank will continue its activities in light of the founding values of
our country with the support of all parties that trust it. I would like
to extend my gratitude to all our stakeholders who have provided
full support for us on this steadfast journey and to all İşbank
employees who have always worked with great dedication.
Yours sincerely,
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 20 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 21
Looking Into the Future
Operating Environment: General Evaluations
Global Economy
In 2022, the uncertainty caused by the Russia-Ukraine
war, as well as the commercial and financial sanctions
imposed on Russia, have been the main risk factors for
the world economy, especially for European economies.
Therefore, while the disruptions in supply chains
for basic needs such as energy and food increased
global inflationary pressures, the rapid tightening of
monetary policies worldwide caused economic activity
to lose momentum. In such an environment where
global recession concerns increased, international
organizations revised their growth forecasts for the
world economy downwards and inflation forecasts
upwards during the year. According to IMF data, the
global economy, which displayed a rapid recovery of
6.2% in 2021, is predicted to have completed 2022 with
a growth rate of 3.4%, and the slowdown trend in the
global economy is expected to continue in 2023 as well.
Despite the slowdown in economic activity, central
banks in advanced economies continued to take strong
tightening steps to fight high inflation, leading to a decline
in the risk appetite for emerging economies. Accordingly,
portfolio investments in emerging economies followed a
fluctuating course during the year.
2022 2023 2024
IMF Forecasts
(January 2023)
Growth
World
3.4
Advanced Economies 2.7
USA
Euro Area
UK
Japan
2.0
3.5
4.1
1.4
Emerging Economies 3.9
Türkiye
Russia
China
Brazil
Inflation
Advanced
Emerging
Increase in World
Trade Volume
5.5
-2.2
3.0
3.1
8.8
7.3
9.9
5.4
2.9
1.2
1.4
0.7
-0.6
1.8
4.0
3.0
0.3
5.2
1.2
6.6
4.6
8.1
2.4
3.1
1.4
1.0
1.6
0.9
0.9
4.2
3.0
2.1
4.5
1.5
4.3
2.6
5.5
3.4
Turkish Economy
After a strong performance in the first half of the year, the
Turkish economy grew by 5.6% in 2022, with a marked
deceleration in the second half. In 2022, tax revenues
increased rapidly due to the buoyant course of economic
activity, especially in the first half of the year, as well as the
high course of inflation throughout the year, supporting
budget revenues, while budget expenditures increased
more moderately compared to revenues. Accordingly, the
budget deficit in 2022 stood at TL 139.1 billion, well below
the budget target set at the end of 2021 and the MTP
forecast announced in September 2022.
In 2022, despite the rapid recovery in transport and
tourism revenues, the current account deficit displayed
a widening trend due to geopolitical developments that
pushed up global commodity prices, particularly energy
prices, and the slowdown in EU economies. Accordingly,
the current account deficit increased nearly 7-fold on an
annual basis to USD 48.8 billion in 2022.
In addition to global inflationary pressures, strong
domestic demand and the lagged effects of the
depreciation in the Turkish lira caused inflation to
remain high during the year. Annual CPI inflation, which
peaked at 85.51% in October, declined from this level
due to the base effect and was realized as 64.3% at the
end of 2022. D-PPI inflation, which reached 157.7% in
October, was 97.7% at the end of the year. The CBRT
has cut the policy rate by a total of 500 basis points
since August and brought it down to 9% as of November.
The volatility in domestic financial markets during the
year due to the rapid tightening trend in global financial
conditions decreased following the implementation of
macroprudential policies. Türkiye’s 5-year CDS premium,
which rose as high as 900 basis points during the year,
followed a downward trend in the last months of the year
and ended the year at around 500 basis points.
Türkiye GDP Growth (annual % change)
Türkiye Inflation Indicators (annual % change)
11.4
5.6
7.5
3.0
1.9
0.8
D-PPI
CPI
200
150
100
50
0
2017
2018
2019
2020
2021
2022
2017
2018
2019
2020
2021
2022
Source: TÜİK data
Source: TÜİK data
Banking Sector*
While the banking sector continued to support economic
activity in 2022, it maintained its strong outlook. The
volume of Turkish Lira loans, including loans to the
financial sector, increased by 77.5% on an annual basis,
reaching TL 4,749.6 billion as of December 30, 2022.
In the same period, the volume of FX loans fell to USD
125.9 billion, with a decrease of 15.7%. Accordingly, the
total loan volume expanded by 52.8% as of December
30, 2022 and reached TL 7,100 billion. According to
the exchange rate adjusted data, the total loan volume
expanded by 38% in this period.
As of December 30, 2022, according to the Weekly Bulletin
data published by the Banking Regulation and Supervision
Agency, the volume of TL deposits, including deposits of banks,
increased by 145.7% and reached TL 4,468 billion compared
to the same period in 2021 with the support of the FX-
protected deposit accounts. The volume of FX deposits in USD
terms decreased by 12.5% in this period and was realized as
USD 208.4 billion. Thus, as of December 30, 2022, the total
deposit volume increased by 68.4% compared to the same
period of the previous year and reached TL 8,360 billion.
According to the exchange rate adjusted data, the annual
increase in total deposit volume was 45.4%.
* Calculated using weekly sector data published by the Banking Regulation and Supervision Agency, with participation banks excluded from sector figures.
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22 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 23
İşbank
2022 was a year in which the high inflation outlook
prevailed, policy rates remained relatively low, and
balance sheets were shaped within the framework of
macroprudential measures. Maintaining its balance
sheet management with a risk-oriented, dynamic, and
sustainable perspective, İşbank increased its asset size
by 52.0% to TL 1,408.3 billion by the end of 2022 and
maintained its title of being “Türkiye's largest private
bank.”
In 2022, İşbank continued to support the real sector
and households, increasing its cash loans by 53.9%
compared to the end of the previous year. The total
equity provided by the Bank to the economy exceeded
TL 1 trillion by the end of 2022, of which TL 759.3 billion
were cash loans and TL 246.7 billion were non-cash
loans. Thus, İşbank continued to be the private bank
making the most significant contribution to the national
economy.
Continuing to improve its asset quality indicators in 2022,
the Bank’s non-performing loans ratio declined to 3.0%
from the previous year-end level of 4.1%.
İşbank’s deposit size increased by 56.3% compared
to the previous year-end and reached TL 931.1 billion.
While the regulations introduced within the framework
of the “liraisation” strategy shaped the composition of
deposits, TL deposits increased by more than 130%
within this framework. İşbank maintained its leading
position among private banks not only in total deposits
but also in size of demand deposits.
Maintaining its strong liquidity level in 2022, İşbank’s total
liquidity coverage ratio stood at 155%, while the foreign
currency liquidity coverage ratio stood at 473%.
İşbank maintained its leading position among private
banks with its shareholders’ equity, which increased by
120.4% in 2022 year-on-year and reached TL 191.4
billion. With a capital adequacy ratio of 24.4% in 2022,
İşbank became one of the banks with the highest ratio in
the sector.
As a result of our stakeholders’ confidence in our Bank’s
strong structure, İşbank significantly increased its market
capitalization during the year and became the bank with
the highest market value among private banks by the
end of 2022.
In 2023, under a macroeconomic outlook in which
inflation loses momentum, exchange rates remain stable
within a narrow band, and the policy rate remains flat,
the banking sector will prioritize the management of
balance sheets shaped by macroprudential policies,
taking into account liquidity, interest rate, and exchange
rate risks. In addition, strengthening capital with products
and services to support equity through risk-adjusted
returns and profitability will be prioritized. Flexible and
agile management will be displayed in the formulation of
balance sheet strategies and updating them according
to changing conditions. In the operating environment of
2023, in which it will be important to manage customer
preferences effectively while adapting to rapidly
changing legislative regulations, the impact of legal
regulations on growth targets and profitability will be
reflected in balance sheet management decisions with a
holistic and prudent perspective along with the priority of
maintaining customer confidence.
With
a capital adequacy ratio
of 24.4% in 2022, İşbank became one
of the banks with the highest ratio in the
sector.
Global Tendencies, Risks,
Opportunities and Forecasts
The year 2022 was completed under the
impact of high inflation and economic
bottlenecks worldwide. The impact of the
COVID-19 pandemic, extreme natural events
caused by climate change, and political turmoil
were other prominent developments of the year.
High inflation negatively affects production
and purchasing power.
Global growth, which was 6.2% in 2021, is predicted to
decline to 3.4% in 2022 and 2.9% in 2023. Global inflation
is projected to rise from 4.7% in 2021 to 8.8% in 2022 but
is expected to decline in 2023 and 2024.1 The predictability
of the future values of economic variables such as input
prices, interest rates, exchange rates, and expenses is
important for making decisions regarding production and
investment in the economy. As prediction becomes more
difficult in an environment of inflation and uncertainty, it also
becomes difficult to make decisions regarding production
and investment. Increasing costs due to inflation, various
financial risks, and uncertainty adversely affect production.
Increasing inflation and decreasing production negatively
affect purchasing power.
The Organization for Economic Cooperation and
Development (OECD) has lowered its forecast for world
economic growth to 3 percent for 2022 and 2.8 percent
for 2023. It also notes that in developing countries, high
energy and food prices have caused deterioration in
households’ real incomes.2 Food prices continued to rise in
most countries, with inflation in the OECD reaching 10.7%.
The highest rates (above 20%) were observed in Estonia,
Hungary, Latvia, Lithuania, and Türkiye.3 The 2022 Global
Inflation Perception Survey conducted by Ipsos in 28
countries revealed that the purchasing power of 8 out of 10
people in Türkiye has decreased. Respondents stated that
they spend more money on food expenditures, give up the
brands they are used to, and follow promotions compared
to three months ago.4 In the 28 countries where the survey
was conducted, people have been worrying about paying
their bills for the next six months.
How do we manage? For details on İşbank’s
practices and performance in this area, please
visit the (internal lnk) “An Inclusive and Resilient
Economy” section.
1 World Economic Outlook Update, January 2023
2 OECD Economic Outlook
3 Prices and purchasing power parities (PPP) - OECD
4 The purchasing power of 8 out of 10 people in Türkiye has fallen- (bloomberght.com)
5 IPCC, “Climate Change 2022: Impacts, Adaptation and Vulnerability” Report
6 World Economic Forum (WEF), 2022 Global Risks Report
7 Deloitte, Turning Point 2022
8 Deloitte 2022 CxO Sustainability Report
The climate crisis continues to top the global
agenda.
While the climate crisis puts pressure on natural resources
and biodiversity by triggering extreme weather events
such as droughts and floods, it also causes an increase in
socio-economic inequality and humanitarian crises between
countries.5
The climate crisis is seen as one of the most important risks
facing the world today. According to the 2022 Global Risk
Report6 published by the World Economic Forum (WEF),
the top global risks include failure to take action for climate,
extreme weather, and loss of biodiversity. According to the
Allianz Risk Barometer 2022 Survey,7 the increase in natural
disasters and climate change are listed in third and sixth
place, respectively. Without timely action, climate change is
estimated to cost the global economy USD 178 trillion over
the next 50 years.
The transition to a low-carbon economy in the fight against
climate change presents companies with a range of
operational, economic, and reputational risks on topics such
as adapting green technologies, complying with international
and national environmental regulations, and accessing
financing. Business leaders now recognize climate change
as a planetary emergency. According to Deloitte's 2022
CxO Sustainability Report,8 which examines the concerns
and actions of senior executives and companies on climate
change and sustainability, 79% of C-level executives or CxOs
believe the tipping point to take action on climate change
has been reached. Compared to the previous survey, this
rate has increased by 20%. Again, 97% of CxOs emphasize
that climate change has already negatively affected their
organizations, while 50% emphasize that it has negatively
affected their operations. The Global CEO Survey9 conducted
by PwC reveals that 40% of CEOs include climate change in
their strategic risk management.
Not only the business world but also society is growing more
concerned about climate change. In a survey on climate
change perceptions conducted by Deloitte in 2021, 57%
of respondents said they “feel concerned about climate
change” and 72% said they “believe climate change is an
emergency”. The Deloitte Global 2022 Generation Z and Y
Survey10 also shows that climate is a top concern for these
generations. 11Generations Z and Y think that the world is at a
critical threshold in terms of climate change and demand that
companies take action on climate change.
How do we manage? Please visit the “Climate
Action” section for details on İşbank's practices
and performance in this area.
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İşbank 2022 Integrated Annual Report 25
The use of big data and artificial intelligence
in the finance sector is on the rise.
In the financial sector, which is a data-intensive industry,
big data and artificial intelligence applications are being
utilized to a great extent thanks to the proliferation of
big data, increasing capacity, and decreasing cost of
technology. 12
Companies can improve their operational performance
with artificial intelligence applications13 (chatbots
and digital assistants, robot consultancy, natural
language processing, machine learning, intelligent
process automation, visual and video data analysis,
etc.). In addition, by offering personalized products
and services, they gain significant advantages in
areas14 such as increasing customer satisfaction and
loyalty, reducing risk, gaining a competitive advantage,
detecting fraud and fraudulent transactions faster, and
making strategic decisions.
According to Deloitte's “State of AI in the Enterprise”
survey,15 94% of business leaders see AI as critical to
success in the next five years. And 76% of respondents
plan to increase their investments in AI to realize
more benefits. According to the results of the survey
conducted by KPMG with over 400 banking leaders,
63% of respondents recognize AI and 54% recognize
data analytics as an important tool for competitive
advantage.16 McKinsey’s “AI Banks of the Future” report
states that AI has the potential to generate USD 1 trillion
in additional benefits for banks each year.17
PwC estimates that AI will boost global GDP by USD 15.7
trillion by 2030.18 A new forecast from the International
Data Corporation (IDC) Worldwide AI Spending Guide
shows that global spending on artificial intelligence (AI)
will reach nearly USD 118 billion in 2022 and exceed
USD 300 billion in 202619. In the banking sector, the AI
market is expected to reach USD 64.03 billion by 2030,
up from USD 3.88 billion in 2020.20
Developments such as the “Great
Resignation” and the “Silent Resignation”
affect companies from all sectors.
The workforce crises known as the “Great Resignation”
and the “Silent Resignation”, which have become more
visible after the pandemic, affect companies from all sectors
all over the world. In the USA, resignation rates, which
increased every year between 2009 and 2020, decreased
due to the uncertainty brought on by the COVID-19
pandemic, but reached a record high as the impacts of the
pandemic subsided. According to the US Bureau of Labor
Statistics, more than 47 million Americans voluntarily quit
their jobs in 2021.21 According to Dr. Anthony Klotz, who
conceptualizes this movement as the Great Resignation,
people who went through transformative processes during
the pandemic quit their jobs or move to new jobs with higher
self-satisfaction, with the desire to embark on new personal
journeys. Professionals who are used to working remotely
during the pandemic do not want to return to the office
environment as the pandemic’s impact subsides and are
looking for other jobs where they can work remotely.22
The Silent Resignation23 movement, which describes people
who, even if they do not resign, refuse work beyond their
assigned tasks or become less psychologically engaged at
work, is also affecting the world. In the USA, employee loyalty
declined further to 32% in the second quarter of 2022, while
the rate of those who do not feel loyalty rose to 18%.24 Since
the pandemic, the way people relate to their work has changed.
People have started to look for more meaning in their jobs,
realizing that the extra effort they put in at work is not paying off.
Silent resignation is a reaction to a culture of hustle and bustle
and burnout from people who are less engaged at work.25
The repercussions of this wave in Türkiye are the desire of
skilled labor to work abroad and the decline in job loyalty
rates. While the economic crisis had not intensified and
the pandemic had not yet started, TÜİK International
Migration Statistics for 2019 report that more than 300
thousand people migrated from Türkiye to abroad.26 In a
study conducted in Türkiye,27 24 percent of employees
state that they are in the process of silent resignation and
46.6 percent state that they are prone to this concept due
to reasons such as low salary, work-private life imbalance,
lack of clear job description, closed career paths, and long
working hours. The rate of those who feel they belong in
their workplace is only 18.5 percent.
How do we manage? For details on İşbank's
practices and performance in this area, please
visit the (internal lnk) “Next Generation Banking”
section.
How do we manage? Please visit the
“Decent Work” section for details on İşbank's
practices and performance in this area.
The transformation of banks into technology
companies is accelerating.
Cybersecurity remains on the agenda as the
most important issue of the digital world.
Digitalization continues to shape the future of the
banking sector as it does in many other industries. In
line with the increasing demand for digital banking
experience, banks are focusing on integrating technology
into all banking processes and services with the aim of
improving customer experience, increasing operational
efficiency, and reducing risks.
According to Insider Intelligence Research, 39% of retail
banking executives say technology has reduced costs,
while 24% say it has improved the customer experience.
The survey also reveals that 66% of executives believe
that new technologies such as blockchain, artificial
intelligence (AI), and the Internet of Things (IoT) will have
the greatest impact on banking by 2025.
On the other hand, there is research that shows that
companies face some challenges in adopting these
technologies. In a recent survey conducted by Deloitte,
84% of respondents said they had difficulty with artificial
intelligence technology, while 65% had difficulty with
cybersecurity, 65% with cloud computing, 62% with
advanced analytics, and 56% with robotic process
automation.
How do we manage? For details on İşbank's
practices and performance in this area, please
visit the “Next Generation Banking” section.
Cybersecurity and data privacy breaches, which emerge
in different ways every day, create risks for companies
of all sizes. Low levels of awareness and inadequate
protection practices leave systems and information
vulnerable. While cybersecurity vulnerabilities increased
by an average of 28.3% annually between 2016 and
2021, it is estimated that the number of data breach
incidents in the world exceeded 40 billion in 2021. The
cost of data breaches has increased from USD 3.86
million to USD 4.24 million, reaching a historic 17-year
high in reported data breaches. 28
The results of Deloitte's cybersecurity survey of
577 senior executives from 26 countries show that
cyberattacking software is a major concern, with the
biggest impact being disruption to operations.29
According to research conducted by the European Union
Agency for Cybersecurity (ENISA) between March and
August 2022, the top 10 cybersecurity threats that will
emerge by 2030 are;
ᆔ Supply chain compromise of software dependencies
ᆔ Advanced disinformation campaigns
ᆔ Rise of digital surveillance/loss of privacy
ᆔ Human error within cyber-physical ecosystems and
exploited legacy systems
ᆔ Targeted attacks enhanced with smart device data
ᆔ Lack of analysis and control of space-based
infrastructure and objects
ᆔ Rise of advanced hybrid threats
ᆔ Skills shortage
ᆔ Cross-border ICT service providers as a single point
of failure
ᆔ Artificial intelligence abuse.30
How do we manage? Please visit the
“Information Security at İşbank” section for details
on İşbank's practices and performance in this area.
9 PwC, Global Annual Review 2022
10 https://www.deloitte.com/global/en/Industries/government-public/perspectives/the-
world-is-ready-for-climate-action.html
11 Deloitte Global 2022 Generation Z and Y Survey
12 Deloitte, Big Data: Time for a Lean Approach in Financial Services
13 https://www.tsb.org.tr/media/attachments/ipek-ulusoy_yapay-zeka-ve-makine-
ogrenmesi.pdf
14 https://www.wipro.com/business-process/why-banks-need-artificial-intelligence/
15 Deloitte State of AI in the Enterprise, 5th Edition, 2022
16 KPMG- Future of Commercial Banking
17 https://www.mckinsey.com/industries/financial-services/our-insights/ai-bank-of-the-
future-can-banks-meet-the-ai-challenge
18 https://www.pwc.co.uk/audit-assurance/assets/explainable-ai.pdf
19 Worldwide Spending on AI-Centric Systems Will Pass $300 Billion by 2026, According
to IDC
20 https://www.upgrad.com/blog/artificial-intelligence-in-banking/
21 The Great Resignation Didn’t Start with the Pandemic (hbr.org)
22 Transcript: The Great Resignation with Molly M. Anderson, Anthony C. Klotz, PhD &
Elaine Welteroth - The Washington Post
23 When Quiet Quitting Is Worse Than the Real Thing (hbr.org)
24 Is Quiet Quitting Real? (gallup.com)
25 “Silent resignation” after “great resignation” | Independent Türkçe (indyturk.com)
26 TÜİK Corporate (tuik.gov.tr)
27 One out of four young people in Türkiye is in the process of ‘silent resignation’ -
(bloomberght.com)
28 https://www2.deloitte.com/content/dam/Deloitte/tr/Documents/technology-media-
telecommunications/deloitte-tubisad-bit-2021-raporu.pdf
29 Deloitte (2021 Future of Cybersecurity Survey, N=577)
30 https://www.enisa.europa.eu/news/cybersecurity-threats-fast-forward-2030
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 26 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 27
Increasing and changing regulations create a
dynamic risk environment.
The impacts of climate change and the pandemic,
economic crises, and political uncertainties bring along
many regulations for the business world. Along with
these regulations, expectations for companies in terms
of sustainability and transparency are increasing. This
creates a dynamic risk environment for companies. While
compliance with regulations requires a high level of effort,
non-compliance can result in a lack of stakeholder trust
and a damaged brand reputation.
Increased regulatory compliance requires collecting
and standardizing a range of data, directing it to the
right decision makers, and incorporating it into risk and
strategic decision-making processes. This process may
be challenging for companies. Participants more than 57%
in Deloitte survey, which included finance, accounting,
sustainability, and legal executives of 300 public
companies with over USD 500 million in revenue, indicated
that data access and data accuracy or completeness
remain their greatest challenges with respect to
Environmental, Social, and Governance (ESG) data.31
Companies are expected to monitor not only their own
operations but also those of their suppliers in line with
regulatory requirements. It is stated that failure to follow
ESG regulations in the supply chain can lead to business
interruptions.32
Aiming to meet the commitments of the Paris Agreement,
the EU Green Deal aims to reduce emissions by at least
55% by 2030 and make the EU carbon neutral by 2050.33
The EU Green Deal is transforming international trade as
well as the fight against climate change. It brings a range
of responsibilities for both companies’ own operations and
those of their suppliers, combining significant opportunities
and risks. The Carbon Border Adjustment Mechanism,
which is part of the EU Green Deal, directly affects our
country, with more than 40% of its exports going to EU
countries. Higher costs and a decrease in competitiveness
are among the expected impacts.34
The Corporate Sustainability Reporting Directive (CSRD),
a new EU legislation, the framework for which was
drafted in 2022, requires all large companies to publish
regular reports on their environmental and social impact
activities. This regulation expands the scope and reporting
requirements of the Non-Financial Reporting Directive
(NFRD). While the NFRD covers around 11,000 companies,
the CSRD will cover around 49,000 companies. 35 The
CSRD is binding for companies currently subject to the
NFRD with more than 250 employees and total assets of
more than EUR 20 million or turnover of more than EUR 40
million. Relevant companies are expected to submit their
CSRD-compliant reports for the 2024 financial year on
January 1, 2025.36
How do we manage? Please visit the
“Transparent and Ethical Management” section
for details on İşbank's practices and performance
in this area.
The impacts of the energy crisis are felt in all
sectors and social life.
The impacts that emerge when the continuity of energy,
which is one of the critical resources for societies, is
endangered or interrupted spread to both economic and
social life. In this respect, the energy crisis emerges as a
factor that threatens sustainable development.
The impacts of rising energy prices are felt by all companies.
While aviation, shipping, and chemical companies are directly
impacted by higher energy prices, the food industry and
tourism sectors are affected by second-round impacts.37 38
The oil and gas industry is one of the sectors most affected
by the energy crisis. While Russia’s invasion of Ukraine and
geopolitical shifts affected energy prices extremely quickly,
negotiations on a new nuclear deal with Iran are complicating
the energy landscape.39
The Ukraine-Russia conflict had an accelerating impact on
the energy crisis. The European Union, which supplies 41%
of its natural gas needs from Russia, is the most dependent
region in the world for energy from Russia. Russia also plays
an important role in the supply of many resources such as
copper, nickel, and lithium needed for renewable energy.40
Energy consumption worldwide is still heavily dependent
on fossil fuels as today's decarbonization policies are fairly
new. In Europe, fossil fuels represent around 70% of final
energy consumption. Electricity, which represents 22% of
energy consumption, is also largely generated from fossil
fuels, mainly gas and coal.41
Energy prices reached record highs, but remain highly
volatile. Before the invasion of Ukraine, wholesale gas prices
were around 200% higher than a year ago. Gas prices
reached more than EUR 340 per MWh in July, more than
ten times higher than a year ago. Wholesale electricity
prices followed a similar trend. High gas demand during the
post-Covid-19 economic recovery also plays an important
role in these high prices.42
The indirect impacts of the energy crisis, such as
production restrictions, shutdowns, and recessions, have
resulted in high energy bills and fuel shortages both in
Europe and in many developing countries. In developing
economies, where the share of household budgets spent
on energy and food is already high, higher energy bills have
increased poverty. This hampers progress towards achieving
energy access. Even in advanced economies, higher energy
bills have impacted vulnerable households and caused
significant economic, social and political strains.43
Rising energy prices are hampering food security and the
ability to meet humanitarian needs. Millions of people have
become dependent on humanitarian assistance to survive.
This, in turn, poses an obstacle to efforts to eradicate
poverty and achieve other development goals.44
How do we manage? For details on İşbank’s
practices and performance in this area, please
visit the “An Inclusive and Resilient Economy”
section.
Russia-Ukraine tensions had a significant
impact on the global economy.
The World Bank’s Economic Update Report shows
that the ongoing war in Ukraine has diminished post-
pandemic economic recovery prospects for emerging and
developing economies in Europe and Central Asia.
As energy price hikes in the aftermath of the Russia-
Ukraine war continue to impact the region, economic
activity is expected to remain under deep pressure over
the coming year, with growth predicted to slow to 0.3% in
2023. In Europe, which continues to hold on despite the
invasion so far, some of the region’s largest economies
are expected to grow beyond expectations, and some
governments are predicted to contract by 0.2% this year
with a cautious extension of pandemic stimulus programs.
According to analyses by the Economist Intelligence
Unit (EIU),45 the conflict between Russia and Ukraine
will negatively impact the global economy in the areas of
financial sanctions, commodity prices, and supply chains.
31 Heads Up — Executive Summary of the SEC's Proposed Rule on Climate Disclosure
Requirements (March 21, 2022; Last Updated March 29, 2022) | DART – Deloitte
Accounting Research Tool
32 Key Trends in ESG Regulations in 2022 and Beyond | RegASK
33 Delivering the European Green Deal (europa.eu)
34 Türkiye should see the EU Green Deal as an opportunity to transition to a low-carbon
economy | WWF
35 4 key sustainability regulations you should know about in 2022 (sustainlab.co)
36 New rules on corporate sustainability reporting: provisional political agreement between
the Council and the European Parliament - Consilium (europa.eu)
37 https://think.ing.com/articles/the-sectors-most-affected-by-soaring-energy-prices
38 First-round impacts: Higher costs from rising energy prices
Second-round impacts: Effects in the new normal because energy prices are likely to
remain high for at least the next two years
39 https://home.kpmg/xx/en/home/insights/2022/04/top-risks-facing-the-oil-and-gas-
industry-in-2022.html
As the global impact of US and EU sanctions against
Russia is limited, the most serious impact of the Russia-
Ukraine conflict on the world economy is expected to
come in the form of higher commodity prices. Concerns
about supply, destruction of physical infrastructure,
and sanctions are also expected to lead to a significant
increase in commodity prices. With gasoline prices set to
rise by at least 50% this year, on top of last year's fivefold
increase and Europe's limited gas stocks, concerns about
gas supplies for the 2022/23 northern hemisphere winter
season continue.
As Russia is a major producer of various base metals
(aluminum, titanium, palladium and nickel), prices are
expected to continue to rise as long as the conflict
continues. This will have a substantial impact on industrial
sectors (such as the automotive industry) across the
globe. Agricultural commodity prices will also continue
to rise as Ukraine and Russia account for more than a
quarter of the global wheat trade. Higher commodity
prices are expected to boost global inflation in 2023. The
EIU expects global inflation to be around 6% this year.46
The impacts of the social dimension of the war have also
started to emerge. According to a UNICEF study,47 the war
in Ukraine and rising inflation pushed four million more
children into poverty in Eastern Europe and Central Asia.
This corresponds to a 19% increase since 2021.
The study on the impact of the war in Ukraine and the
concomitant economic downturn on child poverty in
Eastern Europe and Central Asia, with data from 22
countries, shows that children bear the heaviest burden
of the economic crisis caused by the war. While children
make up 25 percent of the population, they account for
nearly 40 percent of the 10.4 million people who fell into
poverty this year.48
How do we manage? For details on İşbank’s
practices and performance in this area, please
visit the “An Inclusive and Resilient Economy”
section.
40 https://home.kpmg/fr/fr/blogs/home/posts/2022/03/how-the-russia-ukraine-crisis-
impacts-energy-industry.html
41 https://home.kpmg/fr/fr/blogs/home/posts/2022/03/how-the-russia-ukraine-crisis-
impacts-energy-industry.html
42 https://home.kpmg/fr/fr/blogs/home/posts/2022/03/how-the-russia-ukraine-crisis-
impacts-energy-industry.html
43 https://www.iea.org/topics/global-energy-crisis
44 https://reliefweb.int/report/world/understanding-energy-crisis-and-its-impact-food-
security-august-2022
45 The Economist Intelligence Unit / https://www.eiu.com/n/global-economic-implications-
of-the-russia-ukraine-war/ (Mart, 2022)
46 https://www.eiu.com/n/global-economic-implications-of-the-russia-ukraine-war/
47 https://www.unicef.org/turkiye/bas%C4%B1n-b%C3%BCltenleri/unicef-ukrayna-
sava%C5%9F%C4%B1-ve-y%C3%BCkselen-enflasyon-d%C3%B6rt-milyon-
%C3%A7ocu%C4%9Fu-yoksullu%C4%9Fa
48 https://www.unicef.org/turkiye/bas%C4%B1n-b%C3%BCltenleri/unicef-ukrayna-
sava%C5%9F%C4%B1-ve-y%C3%BCkselen-enflasyon-d%C3%B6rt-milyon-
%C3%A7ocu%C4%9Fu-yoksullu%C4%9Fa
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 28 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 29
Message from the
Sustainability Leader
Esteemed Stakeholders
As the first national bank of our Republic, İşbank has been
one of the leading economic actors of our country with its
support for economic development from past to present. Since
1924, İşbank has been contributing to the national economy,
providing financing to all sectors, from industry to agriculture,
and working to increase the welfare level of society.
Our strategic priority
We work with the aim of creating shareable and sustainable
value for all our stakeholders through our business model,
which we define as “İşbank Banking” and which we
continuously develop and pass down from generation to
generation in light of our corporate values.
In order to contribute to the Sustainable Development
Goals by increasing our positive impact together with our
customers, suppliers, and employees, in short, all stakeholders
in our ecosystem, we address sustainability at the highest
level and among the strategic priorities in our business
plans and transform this approach into concrete outputs.
As an organization aware of our responsibility, we address
sustainability in a way that includes actions that will contribute
to our common future.
Since 2015, when we established our Sustainability
Management System, we have been addressing our
sustainability efforts systematically and in line with
international best practices. Our Sustainability Committee, the
highest governance body, includes members of our Board
of Directors and Executive Board. This governance structure
ensures that our comprehensive and multidimensional
sustainability activities are managed from a holistic
perspective and that interdisciplinary interaction is supported.
We address sustainability in all its dimensions with our
business model, which actively manages all areas from end
to end, from reducing the carbon footprint resulting from
our own operations to supporting the green transformation
of our customers, from procuring sustainable resources to
developing sustainability-themed products and services,
offering them to customers, and monitoring the environmental
and social impacts of the credits extended.
Our decarbonization efforts
In order to control the environmental impacts of our own
operations, we monitor different environmental indicators in
key impact areas such as waste generation, water and energy
consumption, and carbon emissions in our Head Office
buildings and branches and continue our digitalization efforts
for paperless banking. By the end of 2022, we obtained ISO
14001 Environmental Management System certification at
all our locations. Based on scientific data, we set the target to
reduce our Scope 1 and 2 emissions by 38% by 2025 and 65%
by 2030 and to conduct our operations as carbon-neutral by
2035. We made a commitment to the Science Based Targets
Initiative (SBTi) for our emission reduction targets to be validated
on a scientific basis. In line with this goal, we procured all of our
electricity consumption as renewable energy in 2022.
Since 2019, we have been sharing our environmental
performance with our stakeholders under the CDP Climate
Change Program. In 2022, we raised our CDP Climate Change
Program score to the “A-” level, which is defined as the
leadership category. We aim to be among the Global Climate
Leaders in this area. We also report to the CDP Water Security
Program to announce our actions on water use and impact
management on water resources.
In April 2022, we made a commitment to the Net Zero Banking
Alliance by taking a very important step to manage the
impacts arising from our loan portfolio and set our reduction
targets. In order to reach net-zero targets by 2050, our Bank
commits to supporting our customers' transition processes to
a net-zero economy by focusing its 2030 targets on carbon-
intensive sectors and reporting and publishing its progress
in emission targets on an annual basis. Joining the Net-Zero
Banking Alliance together with the Principles of Responsible
Banking will further increase our effectiveness in fighting
climate change.
The rising green transformation against the risks posed
by climate change in the world and in our country creates
important opportunities for banks. Banks stand out as
institutions that have the power to transform entire sectors
through their lending processes thanks to being the main
source of financing. Banks’ observance of sustainability
principles in their lending processes ensures that the
companies that will utilize this financing also operate within
the framework of the same principles, enabling better
management of environmental, social, and governance
risks. After 2015, we allocated all financing of new projects
for electricity generation investments to renewable energy
projects. In 2020, we took an industry-leading decision; we
announced that we would not finance new thermal power
plant investments to generate electricity using coal and natural
gas as fuel. Subsequently, we added coal mining, gold mining
using cyanide, and activities prohibited by national legislation
and international conventions regarding the protection of
biodiversity resources and cultural heritage to the Exclusion
List.
At İşbank, since 2012, we have been assessing the potential
environmental and social risks of new investment projects
with a total investment amount of more than USD 10 million
through the Environmental and Social Risk Assessment Model.
We evaluate climate change and its consequences not only
from a risk perspective but also in terms of the opportunities
it creates for green transformation. We see the Carbon Border
Adjustment Mechanism, which will affect SMEs exporting to
the EU, as an opportunity for our customers to reduce their
carbon emissions by increasing their awareness of the issue.
In this regard, we continue our efforts to provide our customers
with both product packages and consultancy. We aim to
contribute to our customers’ green transformation with the
different loan products we offer
In the field of funding, the sustainability-linked syndicated
loans we provide by determining performance indicators
that reveal our environmental and social impacts are another
We have committed to provide TL 300 billion of
sustainable loans by 2026, as well as TL 100 billion
of financing for women entrepreneurs within 5 years.
Within the scope of our Net-Zero Banking Alliance
commitment, we work to establish our emission
reduction targets, prioritizing carbon-intensive sectors.
Gamze Yalçın
Deputy Chief Executive
Sustainability Leader
indicator of our responsible banking approach. In addition,
since 2008, we have been raising funds from abroad to be
used for issues related to environmental and social themes,
including energy efficiency and renewable energy projects
of small and medium-sized enterprises, residential energy
efficiency projects, and green housing loans, as well as
financing SMEs, women's businesses, and enterprises in
prioritized development regions. In 2022, we secured a total of
USD 327 million in new sustainability-related funding from the
EBRD, IFC, and AIIB.
Financing for an inclusive economy
We believe that sustainable development can only be realized
by increasing the participation of women in business and
the female labor force in the economy. To this end, we are
increasingly using both our own resources and external funds
to support women-owned businesses. As a signatory of the
United Nations Women's Empowerment Principles (WEPs), we
continue our efforts in many areas, from financing and training
activities for female entrepreneurs to the egalitarian attitude
that we have displayed towards our women employees.
We believe that conducting our activities by taking these
internationally approved principles into consideration will
create significant added value.
We attach importance to the development of inclusive
products and services that will enable access to financial
services for all segments of society. We concretely
demonstrate our understanding of financial inclusion with the
support we provide to SMEs, women, and young entrepreneurs
and the value we create in agricultural banking.
Practices supporting gender equality
We are one of the pioneering organizations in our country
with our understanding of gender equality. In this organization,
which is based on the equality of women and men and
where equal opportunities are provided in every field from
the first day of employment, we reinforce and develop this
deep-rooted understanding in line with the requirements of
the era. Our Gender Equality Policy was established in 2021
with the decision of our Board of Directors. This Policy sets out
the basic rules and principles regarding our Bank’s practices
that observe gender equality in line with the principles of
equal opportunity and diversity, both for its employees and its
operations..
In 2022, we made this approach visible in the international
arena by being listed in the Bloomberg Gender Equality Index,
one of the most reputable indices in the world.
Our Targets
At İşbank, we structure our sustainability efforts with concrete
targets. We transparently share our efforts and progress
towards the targets we set in our key performance areas.
In parallel with drawing the decarbonization roadmap for
our loan portfolio in 2023, we will focus on increasing our
sustainable finance balance. We have committed to TL 300
billion of sustainable loans by 2026, as well as TL 100 billion of
financing for women entrepreneurs within 5 years. Within the
scope of our Net-Zero Banking Alliance commitment, we work
to establish our emission reduction targets, prioritizing carbon-
intensive sectors.
“The World is Ours, The Future is Ours”
At İşbank, we work with the dream of a beautiful future for
everyone. We use our resources for a world where all segments
of society participate equally in the economy, gender equality is
achieved, natural resources are used responsibly, and children
and young people can dream freely. We would like to thank all
our stakeholders, especially our employees and customers, for
accompanying us on this journey.
Yours sincerely,
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 30 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 31
Management Evaluation and Analysis
How Do We Create Value?
Sustainability at İşbank
Loans accounted for 53.9% of İşbank’s total assets of
TL 1.4 trillion as of year-end 2022. The Bank’s total cash
loans increased by 53.9% in 2022, driven by strong
TL loan growth in the first half. Compared to the end of
the previous year, retail loans and TL commercial loans
increased by 61.0% and 85.6%, respectively, with total
growth in TL loans reaching 75.5%. As a result of our
strategy to reduce the share of FX loans, the contraction
in FX loans accelerated compared to the previous year
and was realized at 10.1% in USD terms.
Deposits continue to be the main source of funding
with a 66.1% share in total liabilities. In 2022, the Bank's
total deposit volume increased by 56.3%. Exchange
rate-protected deposit products were decisive in
deposit development and customer preferences, with
TL deposits increasing by 130.4% while foreign currency
deposits contracted by 10.7% in USD terms.
In 2022, our shareholders’ equity and capital adequacy
ratio remained strong, supported by our net profit. We will
prioritize the management of our balance sheet with a
proactive and prudent approach by considering the risk-
return balance in order to ensure that our strong financial
structure and capital adequacy are maintained under all
conditions in 2023 as well.
As the bank of the future, we aim to repay our debt to
our country, society and the world, not only through
the services we will offer in banking with strong
financial results and a sound financial structure, but
also by making a difference with our social impact and
sustainability initiatives. On the other hand, as a bank that
uses technology in the most effective way to differentiate
itself from the competition with our innovative approach
and that prioritizes entrepreneurship, we will focus on
increasing the contribution of the value created in new
customers, new products/services, and new businesses/
markets to our operating results every day.
Having recorded a strong growth performance in the
first half of 2022 on the back of the high contribution
from private consumption expenditures, the Turkish
economy lost momentum in the third quarter due to
macroprudential measures restricting loan supply and
grew by 5.6% in 2022.
In the Turkish banking sector, loan growth displayed a
strong outlook in the first half of the year amid buoyant
economic activity. In the second half of the year, the
growth in TL commercial loans slowed due to the legal
regulations that were put into effect as of the second
quarter and subsequently increased in weight. The
contraction in FX loans continued to reduce banks’ FX
liquidity needs. While deposits have continued to be
the main source of funding, exchange rate-protected
deposit products, which were announced for the first
time in December 2021, supported the transition from FX
deposits to TL deposits during the year.
In this period, as İşbank, we continued to create value for
the development of the country’s economy and society,
and to pioneer technological development in the sector
with our strong and productive business model, which
we structured in line with our vision of “becoming the
bank of the future, creating sustainable value with an
inclusive and participatory approach” and our strategy
of “managing our balance sheet to ensure sustainable
and value-added growth while using our internal and
external resources in accordance with the priorities of
the country's economy and preparing our enterprise for
the future by continuously improving our business model
along with our group companies and all our business
partners in the period of technological transformation.”
As of year-end 2022, the
Bank maintained its title as
“Türkiye's largest private
bank” in terms of total
assets, loans, deposits, and
shareholders’ equity.
Aiming to create shareable and
lasting value for our country since
its foundation, İşbank’s sustainability
approach has been summarized as
“İşbank Banking”.
Our business model: İşbank Banking
İşbank Banking is a business model that combines
financial and non-financial capital elements with the
goal of “producing shareable and sustainable value”.
With this model, the Bank aims to generate value for all
its stakeholders in the short and long term. This value
creation model, which allows the Bank’s sustainability
priorities to be integrated into all decision-making
processes, positions sustainability as one of the focal
points of its corporate strategy. İşbank carries out all its
efforts in this direction under the ownership of senior
management and with the participation of all employees.
Looking out for social benefit, as well as the needs and
expectations of all its stakeholders, İşbank associates
the outputs of its value creation process with the United
Nations Sustainable Development Goals that it has
contributed to and manifests its support of global goals
with the approach of shareable and sustainable value
creation.
Please visit https://www.isbank.com.tr/en/
about-us/our-approach for the principles of
İşbank Banking.
Highlights in 2022
✓⃞■
✓⃞■
✓⃞■
✓⃞■
✓⃞■
✓⃞■
✓⃞■
✓⃞■
✓⃞■
The first Integrated Annual Report,
which transparently reports our ESG
performance, has been published.
The Bank became a member of
the Net-Zero Banking Alliance,
established by the UN to ensure that
member banks align their portfolios
with net-zero emission targets in line
with the Paris Climate Agreement by
2050.
CDP Climate Change Report
Leadership Score “A-” Leadership
Category
CDP Water Security Report Score
“B” Governance Category
The Bank is listed in the BIST
Sustainability 25 Index.
Gender Equality Program was
established.
The Bank was listed in the
Bloomberg Gender Equality
Index.
Became a member of the 30%
Club.
With the Board decision, the
Diversity Policy of the Board of
Directors was put into effect.
Please visit https://www.isbank.com.tr/en/
about-us/sustainability-milestones to review our
past achievements.
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 32 İşbank 2022 Integrated Annual Report
Our Business Model
Financial
Capital
Human
Capital
Social-Relational
Capital
Intellectual
Capital
Natural
Capital
Produced
Capital
Operational Procedures / Value Creation Items
Our Strategic Goals
Efficient risk
management
Continuous commitment
to our country
Value creating technology and
innovation leadership
Ülkemize kalıcı taahhüt
Strong and
sustainable
financial
performance
Flawless customer experience
Happy and
productive human
resource
Ethical and responsible banking compassionate
towards people, society and the environment
Contributed SDGs
İşbank 2022 Integrated Annual Report 33
Results
Output
Financial Capital:
53.9%
Cash Loan Growth in
Total
58.2%
Average profit on
shareholder equity
TL 931.1 billion
Total deposits
TL 61.5 billion
Net profit
55%✓
Percentage of female
employees
42.6% ✓
Percentage of female
employees in management
97.5%✓
Unionization rate
1.90%✓
Employee turnover rate
Individual Net Promoter
Score Ranking
1.✓
(among private banks)
361✓
Number of graduates
from the "81 Students
from 81 Cities"
569
Number of female
entrepreneurs who
participated in events
to support female
entrepreneurs
16 thousand
Ekonomi.isbank.com.tr
subscribers
2 “İmece Workshops”,
15 "Farmer Meetings”
265
Number of technological
entrepreneurs who were
supported to enter the
banking system
106
Number of projects
financed under ÇESMOD
100%
The amount of energy
generated from
renewable energy
sources of the total
energy consumption
75%
Share of renewable energy
projects in İşbank's total
energy generation projects
portfolio
190 million pages✓
Paper savings with
digitalization
6,169✓
Number of Bankamatik
ATMs
68.2 million
Number of questions
answered with Maxi
䦻 High profitability
䦻 Market share aligned with goals
䧝 The negative impact of the purchasing power
declining due to high inflation on financial capital
䧝 The negative impact of uncertainties caused by
turbulent operating environment on financial capital
Human Capital:
䦻 High employee commitment
䦻 Increasing digital competencies
䧝 The negative impact of decreasing workforce due to
increasing digitalization on human capital
䧝 The negative impact of global trends such as great
resignation on human capital and intellectual capital
Social and Relational Capital:
䧝 The negative impact of increasing digitalization
on relational capital
䦻 The positive impact of a large supply pool on financial capital
䦻 The positive impact of high customer satisfaction
on financial capital
Intellectual Capital:
䦻 The positive impact of low ESG risks with practices regarding
problematic lending on financial and natural capital
䦻 Alignment with current banking through supported fintechs
䧝 The negative impact of uncreditable activities on financial
capital
䧝 Difficulty of transforming large corporate structures during
the transformation of banks into technology companies
Natural Capital:
䦻 The positive impact of decreasing resource consumption
on natural and financial capital
䦻 Efficient management of climate risks contribute to
transformation economy
䧝 The negative impact of increasing "green" regulations on
financial and produced capital
䧝 The budget set aside to decrease the environmental
impact of operations has a negative impact on financial
capital, but a positive impact on human capital
Produced Capital:
䦻 The positive impact of continuous operations through
superior technological competencies on financial and
relational capital
䦻 Decreasing personnel needs have a positive impact on
financial capital but a negative impact on human capital
䦻 The positive impact of going paperless on financial and
natural capital
䧝 The negative impact of increasing digitalization on
relational capital
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 34 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 35
Sustainability Management
Our Stakeholders
The Board of Directors is the highest level management
authority in İşbank’s sustainability management. The
“Sustainability Committee” is the management body that
is responsible for the Bank’s sustainability activities, which
is managed by the Chairperson of the Board, consists of
two Board of Directors and Executive Board Members,
and where all business units are represented. The Deputy
Chief Executive responsible for the Investor Relations and
Sustainability function assumed the role of Sustainability
Leader. The Sustainability Leader is responsible for
representing the Bank in sustainability communications,
including stakeholder engagement, and guiding
sustainability initiatives.
In addition to the Sustainability Committee, consisting of
Board of Directors and Executive Board Members, and the
Sustainability Leader, there is a Sustainability Coordinator
and a Sustainability Working Group.
The Sustainability Coordinator ensures that sustainability
and climate-related issues are effectively on the agenda
of the Bank’s senior management. For this purpose,
representatives from all key business units of the Bank
come together in the Sustainability Working Group.
The aim of the Working Group, which enables information
flow between all divisions, is to ensure that sustainability
and climate-related issues are included in business
decisions.
The Investor Relations and Sustainability Division is
responsible for monitoring developments in the field
of sustainability, analyzing global trends, and ensuring
coordination within the Bank regarding related activities.
The Bank has structured its perspective on sustainability
and its activities in the fields of environment, social and
governance under the "Sustainability Management System"
it established in 2015 and has since been developing
this structure both in an organizational sense and with
innovations in the end-to-end business model. İşbank’s
Sustainability Policy and other complementary policies
approved by the Board of Directors form the basis for the
functioning of the Sustainability Management System.
For İşbank, establishing regular, timely and two-way
communication with stakeholders is a priority in all
activities. The Bank believes in the importance of
stakeholder communication to achieve its corporate
goals and understand stakeholder expectations.
İşbank is a supporter and member of numerous local
and global initiatives. Thus, the Bank aims to be a
learning organization and to be among the actors that
produce solutions for social and environmental issues.
For the Bank's corporate memberships, please visit the
“Corporate Memberships” list.
İşbank also actively uses social media to provide
its customers and all stakeholders with up-to-date
information about the corporation and evaluates
stakeholder opinions on these channels.
In 2022, the total number of followers
of İşbank and its brands on LinkedIn,
Youtube, Twitter, Facebook, and Instagram
was approximately
2.7 million people.
Details of social media accounts can be found
in the “Social Media Followers“ list.
Sustainability
Committee
Sustainability
Coordinator
Sustainability
Leader
Investor
Relations and
Sustainability
Division
Sustainability Working Group
Loans Portfolio
Management
Strategy and Corporate
Performance Management
Risk Management
Purchasing
Loan Allocation
Financial Institutions
Construction and Real
Estate Management
Product Development and
Talent Management
Marketing
Human Resources
You can access İşbank's Sustainability
Policy at https://www.isbank.com.tr/en/about-
us/Documents/sustainability/sustainability-
policy.pdf.
Other policies that support İşbank's
sustainability approach can be found at the
addresses below.
Supplier Code of Conduct
Occupational Health and Safety Policy
Environmental and Social Impacts
Human Rights and Human Resources
Anti-Bribery and Anti-Corruption Policy
Gifts and Hospitality Policy
Gender Equality Policy
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 36 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 37
Our Stakeholders
Employees
Business
Partners
Suppliers
Subsidiaries
Shareholders
A motivated and
qualified workforce
is needed to achieve
corporate goals.
A workforce with
digital competencies
provides a competitive
advantage for the Bank.
Why is it important
for İşbank?
Working Life Evaluation
Survey, training
programs, performance
evaluation, internal
communication
platforms, regular
executive meetings
Communication
channels
Business partners
that match up
with İşbank’s
corporate values
and with whom
joint projects can
be carried out in a
mutually beneficial
relationship
provide financial
and reputational
benefits for the
Bank.
Joint projects,
thematic meetings,
training programs
Long-term supplier
relationships
provide the Bank
with operational
sustainability and
cost advantages.
As an integrated
organization, İşbank
creates value for its
investors through
the synergy it
creates with its
subsidiaries.
İşbank's broad-based
shareholder structure
provides the Bank with
financial strength.
Boards of Directors
of subsidiaries, Joint
projects, reputation
research
Daily communication
with product and
service suppliers,
projects aimed
at increasing
sustainability
awareness among
suppliers
General Assembly and
investor meetings, investor
presentations, analyst and
investor days, promotional
meetings, teleconferences,
daily communications from
the Investor Relations and
Sustainability Division, İşbank
Investor Relations web page,
Public Disclosure Platform
(KAP), the Information
Society Services Platform
established as per the Turkish
Commercial Code, Integrated
Report, CDP Reports
Initiatives
Supported
İşbank contributes
to its corporate
know-how and
reputation through
the initiatives it is
a member of and
supports.
Financial Institutions
and Rating Agencies
University Students
Analysts
Public Institutions
Customers
NGOs and Media
Strong partnerships
with financial institutions
provide the Bank with
advantageous financial
opportunities.
With its employer branding
efforts, İşbank aims to be
a corporation preferred by
the next generation in the
future as it is today.
İşbank contributes
to analysts’ accurate
assessments through
transparent and timely
information sharing, thus
guaranteeing that it is a
preferred corporation.
İşbank ensures its
operational sustainability
by fully complying with
laws and regulations in
all geographies in which
it operates. The Bank
exchanges views with
public institutions and
expresses opinions on
new regulations.
With its high corporate
reputation, İşbank
establishes trust-based
relationships with its
customers and finances
the Bank’s sustainable
growth strategy through its
broad customer base.
İşbank contacts
numerous non-
governmental
organizations to keep
abreast of current
developments,
exchange ideas with
other institutions and
organizations, obtain
information in areas
of need, and share its
corporate news with
the public in a fast and
accurate manner.
Conferences,
seminars,
congresses,
workshops, replying
to written queries
Evaluation and information
meetings, Corporate
Reports, replying to written
queries
Career days, campus
events, sponsorship
activities
Analyst days, investor
meetings, investor
presentations,
teleconferences,
communications of the
Investor Relations and
Sustainability Division,
Annual Report, Integrated
Report, Reputation
Research
Reporting processes,
consultation meetings
Branches, Bankamatik
ATMs, Internet Branch,
Telephone Branch and
mobile banking channels,
customer relations
representatives, meetings,
customer satisfaction
surveys, social media
Information and press
meetings, private
meetings, replying to
written queries, online
training, mentorship
activities and other joint
projects
Basic
expectations from
İşbank
An egalitarian,
development-
supportive, fair working
environment; A
corporation that brings
the competencies
of the day to its
employees; Adoption of
new working models
A win-win approach
with transparent
and innovative
corporate practices
Fair selection
and evaluation
processes;
Fast and easy
communication;
Corporate capacity
building
Protecting and
enhancing İşbank
Group’s reputation,
Joint projects
and information
exchange
To directly and quickly get
accurate and up-to-date
information about İşbank and
exercise their shareholder
rights
Increasing joint
projects
Transparent reporting on
financial and non-financial
performance
Mentoring activities;
Internship and career
opportunities
Transparent non-financial
reporting
Full compliance with
legislation; exchange of
ideas on new regulations
Easy to reach; Accurate
guidance on products and
services; User-friendliness
of digital channels
Quick response to
information requests;
Opportunities for joint
project development
İşbank manages a
competent and large
pool of suppliers
through supplier
selection, evaluation,
and development
systems.
İşbank implements
projects that will
create synergy
with its subsidiaries
and includes its
subsidiaries in its
audit processes.
İşbank’s Investor Relations
and Sustainability Division
considers providing timely
information to the Bank’s
shareholders to be its
primary responsibility.
İşbank shares its
performance with
its stakeholders
by fulfilling the
requirements
of its corporate
engagements that
increase every year.
İşbank reports its financial
and non-financial
performance on various
platforms.
As one of the most
preferred employer brands
in Türkiye, İşbank offers
internship and mentoring
opportunities to a large
number of university
students every year.
İşbank reports its
sustainability performance
in compliance with
numerous international
frameworks.
As one of the leading
players in the sector,
İşbank submits its opinions
on the regulations related
to the sector and carries
out all its activities with a
full compliance approach.
Through its digital
channels, İşbank is
accessible 24/7. Customer
feedback is analyzed and
integrated into decision-
making processes.
İşbank carries out joint
projects with numerous
non-governmental
organizations compatible
with its corporate values.
İşbank has defined its
policies and procedures
to be an egalitarian
employer. The Bank
strives to be the
employer of the next
generation through
trainings developed
for employees at all
levels and models such
as agile working and
hybrid working.
İşbank aims to
establish long-term
relationships with
business partners
who share the
values equivalent
to its corporate
ethical values and
to increase the
corporate capacity
of its business
partners.
İşbank's Response
Related capital
element
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 38 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 39
Materiality Analysis
at İşbank
İşbank identifies and manages its
corporate priorities through a dynamic
process and a multiple-stakeholder
engagement approach.
Through the materiality analysis conducted every year,
İşbank identifies the topics that have the potential to affect
its business model, where stakeholder expectations are
high, and which İşbank can influence, and reviews its
current list of material topics. The dynamic process of
materiality analysis benefits from the opinions of numerous
stakeholders, changing regulations and standards,
corporate strategies, and prominent developments on the
global agenda.
In 2022, the material topics reviewed with a “double
materiality” approach were divided into 3 groups. Our
performance and targets on topics identified as “highly
important” have been shared in detail in the Integrated
Annual Report. The Report includes exemplary projects
and performance indicators for the topics in the
“important” group. “Less important” topics are closely
monitored by İşbank, but performance in this area is not
covered in detail in the report.
Double materiality:
When determining its material topics, İşbank considers
the financial and non-financial impacts of topics with
high potential impact on its business strategies and high
stakeholder expectations with a holistic approach, taking
into account its wide stakeholder network. The financial
and reputational risk that each topic in the materiality
process poses to the Bank and the level of impact that the
topic will have on the relevant stakeholders are evaluated
simultaneously. İşbank adopts a long-term impact
approach. Therefore, even if the short-term financial and
social impact of a topic is low, medium and long-term
social and financial impacts are also considered in line
with stakeholder expectations. In addition, all topics are
also evaluated in terms of İşbank’s potential to influence
the topic. For example, while evaluating Climate Action,
which is among İşbank’s material topics, during the
materiality process, the position of the topic within the
Bank’s business strategies, the financial and social risk
assessment of the topic, the short and long-term impact
of the topic on stakeholders, the existing / developing
regulations and standards around the topic were taken into
consideration, and the positive and negative impacts of
İşbank on Climate Action were evaluated.
In the upcoming period, İşbank will continue its work by
including stakeholder views in the materiality process in
a more dynamic way.
Materiality Steps
Step 1: Topic list
Step 2: Evaluation of topics
Based on the 2021 topic list, a list
of topics that may be important
for İşbank was created. In the
process, corporate strategies,
changing legislation and
standards, sectoral practices,
corporate engagements,
global trends, and stakeholder
expectations were considered.
2.1. Evaluation of stakeholder expectations:
The expectations of key stakeholders in the field
of sustainability from İşbank were determined as a
result of an evaluation of the results of expectation
and satisfaction research organized for various
stakeholder groups and media research.
2.2. Influence on business strategies: The
significance level of the influence of the topics
included in the list of topics on the Bank's
business strategies was evaluated through
comprehensive employee and manager
meetings, corporate strategy and engagement
requirements, results of benchmarking studies,
and global trends.
2.3. İşbank’s impact on the topic: All topics
were assessed in terms of the Bank's positive
and negative social, economic, and environmental
impacts on the topic, and the risks and
opportunities the topic poses for the Bank and its
stakeholders were explored.
Step 3: Selection of
material topics:
The assessed topics were placed in
the materiality matrix.
Step 4: Validation
meetings:
The prepared matrix was approved
by İşbank executives.
MATERIALITY Topics Matrix
Priority
High Priority
Top Priority
l
s
r
e
d
o
h
e
k
a
t
S
r
o
f
e
c
n
a
t
r
o
p
m
I
1⃞■ Cybersecurity and customer
privacy
2⃞■ Financial performance and
profitability
3⃞■ Combating climate change
4⃞■ Efficient risk management
5⃞■ Digital banking
6⃞■ Employee rights, commitment
and satisfaction
7⃞■ Responsible products and services
8⃞■
Responsible financing and investment
decisions integrating ESG criteria
9⃞■ Equal opportunity, diversity and
gender equality
Business ethics, transparency,
corporate management and reporting
Customer centricity
Financial inclusion
Importance for İşbank
The Bank's environmental footprint
Contribution to social welfare
The future of business and new
working models
Responsible procurement and
supply chain
Changes in Material Topics Compared to the Previous Year
The Preferred Employer topic was made a sub-heading of
The Corporate Social Responsibility topic title was changed
Employee Rights, Commitment and Satisfaction.
to Contribution to Social Welfare.
The Digital Transformation topic title was changed to Digital
Responsible Marketing was moved under Responsible
Banking.
Products and Services.
Open Banking was moved under Digital Banking.
The Future of Business and New Working Models topic was
The Financial Literacy topic was made a sub-heading of
Financial Inclusion.
Corporate Governance was added to Business Ethics,
Transparency and Reporting.
added to the matrix.
Employee Volunteerism, Stakeholder Communication,
Compliance with Regulations, and Employee Health and
Safety were removed from the matrix.
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen
40 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 41
Topics
ESG Impacts
Importance for İşbank
Relevant Stakeholders
Related Corporate Policy/Document
How do We Manage?
Combating
Climate
Change
Climate change is the most important issue facing the
planet. Changing climate conditions are fundamentally
altering the way of doing business in many sectors.
Those at the bottom of the income pyramid are the
most adversely affected by this rapid transformation.
The transition to a “Green Economy” is among the
most important agenda items of the global economy.
Business models that do not consider environmental risks show
that companies will face resource issues in the medium and
long term, and this, in turn, will create multidimensional risks for
financial institutions. İşbank analyzes the risks and opportunities
that the transition economy will create and aims to minimize
the environmental impact of its own operations and financing
activities while increasing the number and scope of products and
services that support the green economy.
Financial
Performance
and Profitability
The turbulent global economy, rapidly changing
risk matrices, and a changing and differentiating
competitive environment are factors that make
sustainable profitability difficult. Companies without
stable financial performance have difficulty surviving
in this conjuncture.
İşbank aims to create shareable and sustainable value for
all its stakeholders through its brand which is identified with
confidence in the sector, extensive shareholder and customer
base, advanced international connections, and a well-managed
risk approach.
Digital Banking
Increasing digitalization in the financial sector
increases the accessibility of financial products and
causes traditional banks to compete with fintechs.
Banking and finance are among the sectors most affected by
increasing digitalization and changing customer preferences.
Banks that have difficulty understanding new trends and
fail to offer inclusive products are pushed out from the
competition. Therefore, improving digital banking activities and
communication with customers are among İşbank's main goals.
Employee
Rights,
Commitment
and
Satisfaction
The changing business life after the pandemic has
faced many developments that negatively affect
employee engagement, such as the great resignation
and silent resignation. High employee turnover and
loss of talent are among the major operational risks
affecting all sectors.
İşbank has always been a preferred employer for new graduates
with its unique corporate culture. The Bank continues to retain its
human resources through internal promotion systems and a rich
training portfolio. İşbank meets changing employee expectations
with its agile business models, hybrid working systems, and
investments in employee development.
Equal
Opportunity,
Diversity and
Gender Equality
Economic development is only possible if all
segments of society participate in the economy on
equal terms. In countries where women's participation
in the economy is low, statistics on innovation and the
distribution of national wealth also lag behind.
As part of its banking approach, İşbank supports a participatory
economy in which all segments of society contribute. The Bank
believes it is an ethical and economic necessity for women to
participate in the economy, assume managerial roles, and take
part in social life as they wish.
Cybersecurity
and Customer
Privacy
Increasing digitalization brings with it cyber threats.
The loss or theft of important information poses
serious threats to all individuals and organizations.
It may result in data loss, security threats, business
interruptions, and financial losses.
İşbank meticulously manages cybersecurity and customer
information privacy due to the requirement to ensure trust in
digital banking services, to ensure that next-generation banking
services are preferred by customers, to protect corporate
reputation, and to minimize legal risks.
Responsible
Products and
Services
Efficient Risk
Management
Banking and finance are among the sectors most
affected by changing customer preferences due to
the impact of sustainability. Banks that have difficulty
understanding new trends and fail to offer inclusive
products and services that positively impact the
environment and society are pushed out of the market
and lose their competitive advantage.
İşbank develops products and services that are inclusive of all
segments of society and the economy. Developing products
that not only take into account the different life stages, economic
needs, and sectoral requirements of its customers, but that are
also easy to understand and support savings awareness is the
basis of the Bank's understanding of delivering responsible
products and services.
In the new global economy, the management of non-
financial risks is as important as financial risks. Many
social and environmental risks such as compliance
with regulations, risks arising from climate change,
human resources risks, and reputational risks affect
the sustainability of organizations.
At İşbank, the risk management process, which puts
“good corporate governance” to the forefront and ensures the
segregation of units responsible for monitoring and controlling
risk from executive functions, identifies risks in accordance
with international regulations and manages financial and non-
financial risks together with banking-specific risk management
principles.
Customers
Financial Institutions
Society
Climate Change Risk Policy
Sustainability Policy
Environmental and Social Impacts Policy
Please visit the “Climate Action” section for
our management approach, performance and
goals in this area.
Shareholders
Investors
Employees
Customers
Sectoral Stakeholders
Employees
Customers
Employees
NGOs
Society
Please visit the “Financial Performance”
section for our performance in this area.
Please visit the “Next-Generation Banking”
section for our performance in this area.
Human Rights and Human Resources Policy
Ethical Principles and Operational Rules
Remuneration Policy
Gender Equality Policy
Occupational Health and Safety Policy
Please visit the “Decent Work” section for
our performance in this area.
Human Rights and Human Resources Policy
Gender Equality Policy
Board of Directors Diversity Policy
Please visit the “Decent Work” section for
our management approach, performance, and
goals in this area.
Customers
Sectoral Stakeholders
Regulatory Authorities
Personal Data Protection Policy
Privacy Policy
Disclosure Policy
Please visit the “Information Security at
İşbank” section for our management approach,
performance and goals in this area.
Customers
Public Institutions
Disclosure Policy
Customer Satisfaction Policy
ISO 9001 Quality Policy
Please visit the “Responsible Products and
Services” section for our management approach,
performance and goals in this area.
Public Institutions
Shareholders and Investors
Climate Change Risk Policy
Reputational Risk Policy
Consolidated Risk Policies
Information Systems Risk Management Policy
Model Risk Management Policy
Compliance Risk Management Policy
Anti-Bribery and Anti-Corruption Policy
Risk Policies Implementation Instruction
Please visit the “Efficient Risk Management”
section for our management approach,
performance and goals in this area.
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 42 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 43
Topics
ESG Impacts
Importance for İşbank
Relevant Stakeholders
Related Corporate Policy/Document
How do We Manage?
Responsible
Financing and
Investment
Decisions
Integrating ESG
Criteria
Business
Ethics,
Transparency,
Corporate
Management
and Reporting
Customer
Centricity
The banking sector's main responsibility for
climate action and responsible banking is to take
environmental and social impact factors into
consideration during loan allocation processes.
İşbank meticulously evaluates the environmental, social
and governance risks caused by its lending activities. The
Bank supports multi-partner initiatives in the sector to
increase knowledge in this area.
Customers
Society
Sectoral Stakeholders
Sustainability Policy
Environmental and Social Impacts Policy
Climate Change Risk Policy
Please visit the “Social and Environmental
Risk Management in Loans” section for our
management approach, performance and goals
in this area.
Regulations in the banking and finance sector are
diversifying every year. The reporting, compliance
with ethical principles, and transparency obligations
of institutions are increasing at the same rate. The
risk of non-compliance is one of the leading risks that
threaten all institutions.
Compliance with business ethics principles has always been
among the uncompromising corporate priorities of İşbank.
The Bank shapes all of its stakeholder relations in line with
these principles. The Bank strives for full compliance with laws
and regulations in all areas and regions in which it operates.
The Bank manages its risks in this area through a corporate
governance structure complying with international standards
and numerous voluntary and mandatory reports.
Rapidly changing customer preferences due to the
impact of sustainability, increasing access to financial
services, and fintechs becoming competitors to
traditional banks are developments that increase the
importance of understanding changing customer
expectations. Corporations that do not invest in this area
may lose their competitive advantage in the market.
İşbank endeavors to become a reliable partner that all
customers can access when required and find easy to work with.
In line with its strategy of being "the closest bank to customers",
the Bank reviews all its systems and processes by looking at
them from a customer-experience point of view.
Public Institutions
Shareholders and Investors
Ethical Principles and Operational Rules
Disclosure Policy
Anti-Bribery and Anti-Corruption Policy
Gifts and Hospitality Policy
Please visit the “Transparent and Ethical
Management” section for our management
approach, performance and goals in this area.
Customers
Customer Satisfaction Policy
Disclosure Policy
Please visit the “Customer Centricity”
section for our management approach,
performance and goals in this area.
Financial
Inclusion
Increasing access to financial products and enabling
everyone to contribute to the economy are among the
sustainable development goals and among the most
important responsibilities of the banking and finance
sector.
İşbank aims to increase and ensure fair distribution of social
welfare by developing products and services for all segments
of society. The Bank supports entrepreneurship, transfers
resources to SMEs, creates financing resources to increase the
participation of women and youth in the economy, and strives to
increase financial literacy.
Customers
Society
Sustainability Policy
Please visit the “Financial Inclusion” section
for our management approach, performance and
goals in this area.
The Bank's
Environmental
Footprint
In combating climate change, all organizations are
working to reduce their environmental footprint.
Regardless of the sector, reducing environmental
impacts has also become an area of competition.
İşbank has set its target to reduce greenhouse gas emissions
and shared this target with its stakeholders within the scope of
the CDP Climate Change Program reporting.
Society
Regulatory Authorities
Sustainability Policy
Environmental and Social Impacts Policy
Climate Change Risk Policy
Please visit the “Environmental Impact
Management” section for our management
approach, performance and goals in this area.
Contribution to
social welfare
Brands that show sensitivity to social issues and
establish a relationship with society, not only with their
products but also with their values, gain a competitive
advantage. They increase their legitimacy, brand value,
and reputation in the eyes of society.
As one of the leading banks in Türkiye, İşbank plays a pioneering
role in building a better society. Through its contribution to the
national economy and long-term social responsibility projects,
the Bank contributes to the dream of a better world for future
generations.
The Future of
Business and
New Working
Models
Alternative working models that increased with the
pandemic have become permanent in many sectors.
Remote working, hybrid working, and project-based
business models are increasingly finding a place in
traditional working life and are preferred by employees.
İşbank considers the needs and expectations of its employees
while maintaining its well-established employer brand. Thanks to
its robust technological infrastructure, the Bank supports remote
working and hybrid working models. The Bank's ever-increasing
number of agile working groups also creates significant value for
next-generation employees who desire a dynamic working life.
Society
Sustainability Policy
Environmental and Social Impacts Policy
Gender Equality Policy
Please visit the “Contribution to social
welfare” section for our management approach,
performance and goals in this area.
Employees
Human Rights and Human Resources Policy
Gender Equality Policy
Please visit the “Decent Work” section for
our management approach, performance, and
goals in this area.
Responsible
Purchasing and
Supply Chain
Supply chain disruptions and incidents of non-
compliance threaten operational sustainability in many
sectors, and institutions are becoming increasingly
responsible for the performance of their supply chains.
İşbank establishes long-term relationships with its suppliers
based on a win-win approach. The Bank works with companies
that have norms equivalent to its corporate sustainability and
ethical approach and carries out practices and training activities
to improve their performance.
Suppliers
Business Partners
Supplier Management Principles
Supplier Management Principles
Please visit the “Responsible Purchasing”
section for our management approach,
performance and goals in this area.
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İşbank 2022 Integrated Annual Report 45
B oard of
Directors
Executive
B oard
M anagers
E m ployees
B usiness
Partners
S uppliers
S ubsidiaries
S hareholders
Initiatives
S upported
Institutions
Finance
U niversity
Students
A nalysts
Institutions
P ublic
C usto m ers
N G O s
Material Topics and Reporting Frameworks
Topic
Reporting Framework
Impact on
business
strategy
Stakeholder
Expectations
GRI
SASB
TCFD
SKA
UN WEPs
Digital banking
Customer centricity
Priorities according
to stakeholder
groups
Cybersecurity and
customer privacy
Financial performance
and profitability
Combating climate
change
Efficient risk
management
Employee rights,
commitment and
satisfaction
Responsible products
and services
Responsible financing
and investment
integrating ESG
criteria
Equal opportunity,
diversity and gender
equality
Business ethics,
transparency and
reporting
Financial inclusion
The Bank's
environmental
footprint
Contribution
to Social Welfare
The Future of
Business and New
Working Models
Responsible
Procurement and
Supply Chain
The Bank's
environmental footprint
302-1, 302-2, 302-3, 302-4, 302-5,
303-3, 303-5, 305-1, 305-2, 305-3,
305-4, 305-5, 306-2, 306-3, 306-4
Employee rights,
commitment and
satisfaction
Responsible financing
and investment decisions
integrating ESG criteria
Digital banking
Equal opportunity,
diversity and gender
equality
Financial inclusion
202-1, 401-1, 401-2,
401-3, 402-1
304-2, 413-2
201-3, 405-1, 405-2, 406-1
Combating climate
change
Business ethics,
transparency, corporate
management and reporting
205-1, 205-2, 205-3, 408-1,
409-1, 410-1, 415-1
Contribution to social
welfare
203-1, 203-2, 413-1
Customer centricity
417-1, 417-2, 417-3
Efficient risk
management
Cybersecurity and
customer privacy
201-2
418-1
Responsible supply and
procurement
204-1, 308-1, 308-2, 414-1, 414-2
Responsible products
and services
The future of business
and new working
models
Financial performance
and profitability
201-1, 201-4
Low
Medium
High
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46 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 47
İşBank's
Sustainability Journey
Initiatives Supported
in the Field of Sustainability
2012
2 014
2015
The first Sustainability Report was
published.
The UN Global Compact (UNGC) was
signed.
The “Environmental and Social Risk
Evaluation Model (ERET)” was developed
to determine environmental and social
risks in loan processes.
The Sustainability Policy, which
includes Environmental and
Social Impacts, Human Rights and
Human Resources, Anti-Bribery
and Anti-Corruption, Gifts and
Hospitality Policies, was approved
by the Board of Directors and put
into action.
The Sustainability Management
System was established.
İşbank was listed in the BIST
Sustainability Index.
İşbank Head Office building was
awarded the international BREEAM
In-Use Excellent certificate.
2016
2017
2018
2019
İşbank was
included in the
FTSE4Good
Emerging
MarketsIndex.
The Global Compact
Türkiye Declaration on
Sustainable Finance was
signed.
Tuzla Technology and
Operation Center was
awarded the LEED Gold
green building certificate.
Tuzla Data Center was
certified with LEED v4 Gold
for Data Centers.
The first 100% Green Eurobond
transaction among Turkish banks
was issued.
The first Green Project
Financing Loan was
provided.
The first Integrated Report was
published.
An Environmental Management
System (ISO 14001) was formed in
line with international standards.
CDP Climate Change Reporting
was initiated.
2020
2021
2022
Loans for financing greenfield
investments of coal- and natural
gas-fired thermal power plants to be
established for electricity generation
were included in the İşbank
Exclusion List.
A Sustainability Committee, which
operates under the Board of
Directors Was established.
The Sustainable Bonds Framework
was formed.
In line with the “ScienceBased
Targets” (SBT), the goal of being
carbon neutral was set.
International ESG risk rating was
obtained from Sustainalytics.
The UN Women's Empowerment
Principles (WEPs) were signed.
United Nations Environment
Program Finance Initiative (UNEP FI)
Principles of Responsible Banking
were signed.
Gold mining operations using
cyanide were added to the Exclusion
List.
The first sustainability-linked
syndicated loan agreement was
signed.
The Sustainable Finance Framework
was formed.
Renewable energy has started to be
used in all of the Bank's operational
areas where renewable energy
can be supplied for electricity
consumption.
Environmental and Social Impact
-Assesment Model "ÇESMOD" was
developed.
The Gender Equality Policy entered
into force.
The Climate Change Risk Policy was
formed.
The CDP Water Security Report was
initiated.
The first Integrated Annual Report
was published.
The Bank committed to the Net-
Zero Banking Alliance (NZBA).
Became a member of the 30%
Club.
With the decision of the Board,
the Diversity Policy of the Board of
Directors was put into effect.
The Bank was listed in the BIST
Sustainability 25 Index and
Bloomberg Gender Equality Index.
Arya Venture Capital Investment
Fund, the first gender balance-
oriented venture capital investment
fund in Türkiye and the MENA
region, was established, and the
Bank became its main investor.
The UN Global Compact and the Declaration of
Sustainable Finance
The UN Global Compact is the world's largest
corporate sustainability initiative. İşbank is committed
to complying with the principles of the Global Compact
in all its activities. İşbank fulfilled the requirements of
the Global Compact, which was renewed in 2022, by
becoming a member of the “early adopter” program
before the mandatory transition process.
İşbank is a member of the Global Compact Türkiye
Sustainable Finance Working Group. The group aims
to raise awareness on the concept of sustainability
across the real sector, especially in the Turkish finance
sector, and mobilize the private sector to create the
financial resources needed to achieve the Sustainable
Development Goals.
İşbank is a signatory of Global Compact Türkiye's
Declaration of Sustainable Finance, which was
prepared by the Global Compact Türkiye Sustainable
Banking and Finance Working Group. With this
declaration, the signatory banks pledged to take
environmental and social risks into consideration
during loan assessment processes and support
“innovative sustainable finance principles” for
investments of USD 10 million and above. With this
support, İşbank declared to not only take social and
environmental risks into consideration during loan
assessment processes but also to play a leading
role in embracing an inclusive and sustainable
finance approach that supports the development of
sustainability-driven banking products as well as the
growth of this market.
United Nations Environment Program Finance
Initiative (UNEP FI) Principles of Responsible
Banking (PRB)
The Principles of Responsible Banking introduced by the UNEP
FI are intended to ensure alignment of the signatory banks
with the vision set forth in the United Nations Sustainable
Development Goals (SDGs) and the Paris Climate Agreement.
These principles, which define the role that the banking
sector can play to achieve a green and inclusive economy,
are designed to maximize the influence of the banking sector
on the efforts toward sustainable economic growth. Being a
signatory of the UNEP FI Principles of Responsible Banking
and a member of the UNEP FI, İşbank completed its portfolio
impact analysis in 2022 and maintained its collaborative
efforts in the UNEP FI working groups.
United Nations Sustainable Development Goals
The Sustainable Development Goals are a call to action that
includes the goals to be achieved by the end of 2030 by the
United Nations member states. It focuses on solving social,
cultural and ecological issues grouped under 17 main topics,
such as ending hunger and poverty, combating climate
change, gender equality, quality education, and responsible
production and consumption worldwide.
İşbank is aware of the transformative power and responsibility
of the banking and finance sector in sustainable development.
Therefore, the Bank supports the United Nations Sustainable
Development Goals and reports its direct and indirect
contributions to the goals.
The Banks Association
of Turkey Sustainability Working Group
İşbank is an active participant of the the Banks Association of
Turkey(BAT) Sustainability Working Group. The group shares
information on local and global developments in sustainability,
exchanges views on sustainability by holding meetings with
regulatory institutions and boards, and develops training
programs to support sustainability efforts in the sector.
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İşbank 2022 Integrated Annual Report 49
Net-Zero Banking Alliance (NZBA)
Environmental Initiatives
With more than 100 members from 40 countries, the
Net-Zero Banking Alliance represents nearly 40% of
global banking assets. The Alliance is critical to mobilizing
the financial sector for climate action. Members of the
Alliance: commit to aligning their portfolios with net-zero
emissions targets by 2050, set scenario-based interim
targets in priority sectors for 2030 or earlier, prioritize
carbon-intensive sectors with the most significant impact
when setting targets, set initial targets within 18 months
of becoming a member, and disclose progress on the
transition strategy set at a high level within one year of
setting targets.
In April 2022, İşbank made a commitment to this
alliance by taking a very important step to manage the
impacts arising from its loan portfolio and set reduction
targets. In order to reach net-zero targets by 2050, the
Bank committed to supporting its customers' transition
processes to a net-zero economy by focusing its 2030
targets on carbon-intensive sectors and reporting and
publishing its progress in emission targets on an annual
basis. The Net-Zero Banking Alliance commitments, along
with the Principles of Responsible Banking, will further
increase the effectiveness of İşbank in fighting climate
change.
CDP- Carbon Disclosure Project
CDP is an independent global organization that allows
publicly-traded companies to disclose information to
their investors about how they use natural resources
and manage the risks in this area. İşbank has been
transparently sharing its environmental goals and
performance with its stakeholders within the scope of
the CDP Climate Change Program since 2019. The Bank
was awarded a score of “A-” Leadership level in the CDP
Climate Change Program in 2022. İşbank also began
to make disclosures as part of the CDP Water Security
Program to report on its water usage as well as the actions
taken to manage its impact on water resources in 2021,
and its score in this area was "B" Management level in
2022.
Science-Based Targets Initiative (SBTi)
The Science-Based Targets Initiative directs the private
sector's climate action by enabling companies to set
science-based emission reduction targets in order to keep
the global temperature increase below 1.5⁰C and to meet
the targets set in the Paris Climate Agreement. İşbank
committed to basing its emission reduction targets on
Science-Based Targets.
The UN Women's Empowerment Principles (WEPs)
The UN Women's Empowerment Principles offer guidance
to businesses on how to promote women's empowerment
in the workplace and in the community. As a signatory of
WEPs, İşbank assumes a role in promoting and facilitating
the participation of women in employment.
Bloomberg Gender Equality Index
The Bloomberg Gender Equality Index (GEI), a
capitalization-weighted variable market index that
adopts transparency in data reporting and aims to
monitor the performance of publicly traded companies,
measures gender equality in five categories.
İşbank joined the GEI in 2022 and transparently reported
its efforts on gender equality internationally.
Global Reporting Initiative (GRI)
GRI standards are standards that enable all organizations,
regardless of size and sector, to understand and report
abouttheir impact on the economy, environment, and
people. İşbank has been reporting its sustainability
performance in accordance with the GRI Standard since
2012.
International Integrated Reporting Council - IIRC
IIRC is a global coalition of regulatory authorities, investors,
companies, standard-setting authorities, accounting
experts, and NGOs. İşbank has been publishing its
integrated sustainability and annual reports in compliance
with the IIRC reporting framework since 2018.
Integrated Reporting Association Türkiye
(ERTA)
Founded to raise awareness on integrated reporting and
integrated thinking throughout Türkiye, ERTA strives to
enhance the capacity of businesses and ensure that good
practices are shared. The association aims to establish
integrated thinking as a core value across all institutions
and organizations through collaboration, at a national and
international level, with organizations from the public and
private sectors as well as non-governmental organizations
and academic institutions. İşbank is a member of ERTA.
30% Club
The 30% Club is a cooperation in which the chairpersons
of the board of directors and CEOs aim to improve the
gender balance at all levels of their organizations. Behind
this cooperation lies the belief that gender balance will make
companies more successful and boards more effective.
İşbank became a member of the 30% Club in 2022.
Refinitiv
Refinitiv Information Limited (Refinitiv) is an international
rating agency that measures the environmental, social,
and governance performance of organizations. İşbank
ranked 4th among 1,097 global banks with a score of 94
out of 100 as of the end of 2022 in the evaluation done by
Refinitiv.
Indexes in which İşbank is listed
and scored
Sustainalytics
Sustainalytics is an internationally recognized research
and rating organization that focuses on sustainability
and evaluates the environmental, social and governance
performance of organizations.
İşbank received a rating of 18.6 in the ESG assessment for
2022, achieving a "low risk" level.
The Bank's objective is to strengthen its funding structure
and become a key player that promotes sustainable and
inclusive economic growth by gaining access to green/
sustainable funds from international markets by making
use of this and other similar ratings from organizations
that conduct an in-depth assessment of the Bank's
sustainability performance.
FTSE4Good Emerging Markets Index
BIST
SÜRDÜRÜLEBİLİRLİK
ENDEKSİ
The "FTSE4Good Emerging Markets Index", launched by
the global index and data provider FTSE Russell under the
guardianship of the London Stock Exchange, is viewed
as one of the key global indices that organizations take
into account as they seek to invest in companies that
demonstrate good sustainability practices. The index,
which was launched to encourage financial institutions
to take environmental, social and governance criteria into
consideration when making investment decisions, assesses
the performance of organizations against such criteria.
BIST
İşbank has been included in the "FTSE4Good Emerging
SÜRDÜRÜLEBİLİRLİK
Markets Index" since 2016. The Bank also aims to be listed
ENDEKSİ ŞİRKETİ
in the Dow Jones Sustainability Index in the future.
BIST
SUSTAINABILITY
INDEX
BIST Sustainability Index
BIST
The BIST Sustainability Index was created to help
the companies listed in Borsa İstanbul gain a better
SUSTAINABILITY INDEX
CONSTITUENT COMPANY
understanding of sustainability and embrace best
sustainability practices and includes only those companies
that are publicly traded in Borsa İstanbul and have a top-
level corporate sustainability performance.
İşbank has been included in the "BIST Sustainability
Index" since 2015. In addition, it was included in the
BIST Sustainability 25 Index in 2022 with its successful
performance in environmental, social, and governance areas.
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 50 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 51
Contribution to Sustainable
Development Goals
İşbank considers the UN Sustainable Development
Goals (SDGs) as an important component of its
sustainability strategy and monitors and reports its
performance against these goals.
The banking and finance sector has the necessary
expertise and resources to be able to offer solutions,
both direct and indirect, to global issues. The sector's
transformative power and leverage effect on the
economy mean that it is well-equipped to make
significant contributions to the Sustainable Development
Goals.
İşbank indirectly contributes to these goals by providing
the necessary funding for solutions that have the
potential to help solve the issues associated with the 17
development goals. İşbank directly contributes to 7 goals
that fall into its field of activity.
Contributed SDGs
İşbank's Approach
Targets to which the Bank Contributes
Material Topic
4.1 Ensuring that all girls and boys complete primary
and secondary education
4.2 Ensuring that all girls and boys have access to
quality preschool education
4.3 Increasing access to technical and vocational
education
4.4 Improving technical and vocational skills and
entrepreneurship
4.5 Eliminating gender disparities in education
4.7 Achieving literacy and numeracy in the field of
sustainable development
4.a Providing inclusive learning environments for all
5.1. Ending all forms of discrimination against women
and girls everywhere
5.2. Eliminating all forms of violence against all
women and girls in public and private spheres,
including trafficking, sexual and other types of
exploitation
5.5. Ensuring women's full and effective participation
and equal opportunities for leadership at all levels of
decision-making in political, economic, and public life
5.a. Undertaking reforms to give women equal
rights to economic resources, as well as access to
ownership and control over land and other forms of
property, financial services, inheritance and natural
resources, in accordance with national laws
5.b. Enhancing the use of enabling technology,
in particular information and communications
technology, to promote the empowerment of women
5.c. Adopting and strengthening sound policies and
enforceable legislation for the promotion of gender
equality and the empowerment of all women and
girls at all levels
7.2 Increasing investments in renewable energy
7.3 Increasing energy efficiency
İşbank believes that easily accessible
and quality education is essential for
sustainable development. Therefore,
the Bank not only invests in the
development of its employees, but also
contributes to Türkiye’seducation quality
through programs led as part of its long-
term social responsibility projects.
İşbank believes that the participation
of women and girls in economic
and social life is one of the most
important components of sustainable
development. Within the scope of the
Gender Equality Program, the Bank
implements projects that encompass
the entire value chain, including its
employees, customers, business
partners, suppliers, and society at large.
İşbank supports the transition to a
low-carbon economy and puts up
the finance for renewable energy
investments with the aim of energy
transformation. The Bank funds raising
for the renewable energy sector by
committing itself to utilizing renewable
resources in its operations.
Strategic
Area
Decent Work,
Contribution
to Social
Welfare
Employee
Rights,
Commitment
and Satisfaction,
Contribution to
Social Welfare
Equal
Opportunity and
Diversity,
Decent Work,
Responsible
Banking
Responsible
Products and
Services,
Financial
Inclusion
Climate Action,
The Bank's
Environmental
Footprint
Climate
Action,
Operational
Impact
Management
Contributed SDGs
İşbank's Approach
Targets to which the Bank Contributes
Material Topic
8.2: Increasing the economic added value created
8.3: Creating more decent jobs
8.4: Decoupling economic growth from
environmental degradation
8.5: Achieving full employment and decent work for
all women and men
8.6: Increasing youth employment
8.7: Eradicating forced labor and ending modern
slavery
8.8: Protecting labor rights
9.2: Promoting inclusive and sustainable
industrialization
9.4: Supporting clean and environmentally-friendly
technologies
9.5: Increasing the budget for Research &
Development activities
10.2: Promoting inclusive economic growth for all
10.3: Eliminating discrimination
10.4: Adopting policies that can prevent inequality
Responsible
Products and
Services,
The Bank's
Environmental
Footprint,
Combating
Climate Change,
Financing and
Investment
Integrating
ESG Criteria,
Employee
Rights,
Commitment
and Satisfaction,
Responsible
Products and
Services,
Combating
Climate Change,
Financing and
Investment
Integrating ESG
Criteria
Responsible
Products and
Services,
Employee
Rights,
Commitment
and Satisfaction
Strategic
Area
An Inclusive
and Robust
Economy,
Decent Work
An Inclusive
and Robust
Economy,
Next-
Generation
Banking
An Inclusive
and Robust
Economy,
Decent Work
13.1 Strengthening resilience to climate-related
hazards and natural disasters
13.3 Improving awareness on climate change and
adaptation
Climate Action,
The Bank's
Environmental
Footprint
Climate
Action,
Operational
Impact
Management
Besides its widespread network
of branches and digital banking
applications, İşbank also supports
access to financial services and
contributes to social welfare through
products and services developed for
disadvantaged customer groups. By
making its unbiased and comprehensive
economic reports electronically
accessible to all, the Bank wishes
to allow stakeholders from different
backgrounds to benefit from its
intellectual knowledge. İşbank also
creates value by offering its employees a
fair and decent work environment.
Supporting sustainable industries and
investing in scientific research and
innovation are essential to making
sustainable development possible.
İşbank supports the transition to the new
economy by focusing on digital banking
solutions, financing infrastructure
investments, performing innovative
development projects, and supporting
startups.
The banking sector has an important
role and responsibility to provide
financial resources so that economic
inequalities can be eliminated. İşbank is
against all kinds of discrimination. The
Bank strives to create sustainable value
for all stakeholders by providing a fair
work environment, increasing access
of disadvantaged groups to financial
services, and supporting long-term
social responsibility programs.
Supporting the transition to a
low-carbon economy, İşbank
takes environmental impacts into
consideration when offering products
and services. The environmental and
social impacts of the projects financed
are rigorously reviewed to ensure
that appropriate actions are taken
to minimize/eliminate potential risks
that may arise from the projects. As
a member of the Net-Zero Banking
Alliance (NZBA), in 2022, the Bank
continued to support the transition of the
real economy to net-zero emissions and
carbon-free strategies. The Bank help
tackle the-climate change by reducing
its environmental footprint.
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 02
Reliable
Financial Actor
54 An Inclusive and Robust Economy
76 Climate Action
88 Next-Generation Banking
54 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 55
Inclusive and
Robust Economy
inclusive and robust economy represents an economic growth model which
allows everyone to benefit from economic well-being and creates opportunities for all. As
İşbank, we strive to ensure that the growth potential that the financial sector can create
through its leverage effect is equally reflected in all segments of society.
Related Capital
Elements:
Relevant Stakeholders:
ᲁCustomers
ᲁPublic institutions and
regulatory authorities
ᲁSectoral stakeholders
ᲁInvestors and
shareholders
Material Topics
ᲁCombating Climate
Change
ᲁFinancial Performance
and Profitability
ᲁFinancial Inclusion
ᲁCustomer Centricity
ᲁResponsible Products
and Services
Risks
Opportunities
High inflation and falling purchasing power
because of supply chain disruptions caused by the
COVID-19 pandemic
Global uncertainties making long-term planning
difficult
Declining customer loyalty as a result of increased
digitalization and reduced customer contact
Losing touch with developments such as platform
business models and sharing economy, which are
essential components of the new economy
Penalties and sanctions that may be incurred
due to rapidly changing regulations and non-
compliance
Inequalities due to large sub-populations being
unable to access financial resources
Reputational risks to the sector due to complex
and non-transparent financial transactions and
processes
The financial impacts of global and national actions
expected to be taken to fight against climate change
Extreme weather conditionsand loss of biodiversity
as a result of the global failure of actions to address
climate change
Increasing customer satisfaction by developing
products and services according to their
expectations and needs thanks to regular customer
communication with experienced İşbank personnel
serving customers in addition to digital channels
İşbank's ability to quickly make use of emerging
opportunities thanks to its robust financial structure
The Bank's dynamic and proactive business
strategy that prioritizes sustainable growth
Increasing the Bank's penetration through products
specifically developed for disadvantaged groups
Contributing to the global fight against climate
change by offering products and services that
support customers' transition to a carbon neutral
economy
Expanding the customer base by developing
products and services that address the needs of all
groups of society
Increasing customer satisfaction by providing
customers with accurate and timely information
about products and services
Contributed SDGs
Key Performance Indicators
Total Cash Loan Growth (%)
Non-performing Loan Ratio (%)
2019
4.7
6.5
Swap-adjusted Net Interest Margin (%)
3.71
Net Fees and Commissions Growth (%) 26.4
OPEX Growth (%)
Cost / Income Ratio (%)**
21.8
38.8
Return on Average Tangible Equity (%)
12.1
Return on Average Assets (%)
Capital Adequacy Ratio (%)
Tier 1 Ratio (%)
Leverage (%)
Number of Customers (million)
1.39
17.87
14.97
9.07
19.50
Individual Net Promoter Score Ranking
(among private banks)
1
Customer satisfaction score (%)
81.2
Number of people reached through
Farmer Meetings
Number of disabled-friendly
Bankamatik ATMs
4,485
4,410
Number of female entrepreneurs who
participated in events to support female
entrepreneurs
425
Number of events organized in support
of SMEs
34
2020
27.7
5.6 (6.5)*
4.37
0.9
20.5
32.9
11.8
1.25
2021
2022
42.9
4.1
3.14
35.6
34.9
30.9
20.0
1.92
53.9
3.0
6.85
111.9
113.9
25.8
58.2
5.32
18.68 (18.02)*
20.36 (16.53)*
24.36 (21.49)*
14.73 (14.17)*
15.78 (12.49)*
20.51 (17.91)*
7.88
20.00
1
86.2
1,500
4,598
448
40
6.75
20.7
1
90
1,861
5,113
267
29
9.19
22.8✓
1✓
N/A***✓
7,000
5,731✓
2,328****
19
Number of İŞ'TE SME website views
1,112,126
550,413
439,000
410,278✓
Improving financial literacy and savings
awareness
Number of feedback responses
communicated to the Customer
Relationship Program
More than 21 thousand
students participated in
the workshops held at
İşbank Museum.
Museum workshops
could not be held from
March 2020 onwards
due to the COVID-19
measures put in place.
Museum workshops
could not be held
due to the COVID-19
measures put in place.
In 2022, 11,910
students
participated in the
workshops held at
İşbank Museums.
466,708
824,456
656,000
693,162
* Excluding impact of BRSA measures.
** Adjusted rates included in 2019, 2020, 2021 and 2022 investor presentations.
*** As of 2022, Retail and Commercial Net Promoter Score are tracked instead of the overall customer satisfaction score.
**** Calculated by including WeLead (Leading Women Entrepreneurship for Accelerating Development) and Arya Women Investment Platform studies.
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 56 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 57
Targets
Targets for 2022
TL Loan Growth ~45%(1)
TL Deposit Growth ~60%(1)
Return on Average Tangible Equity >40%(1)
Swap-adjusted Net Interest Margin >5%(1)
75.5%
130.4%
58.2%
6.8%
Increase in Net Fees and Commissions Income > 80%(1)
111.9%
OPEX Growth at Inflation Levels
OPEX / Operating Income 35-36%
NPL Ratio <4%(1)
Net Cost of Risk <125 bp(3)
Capital Adequacy Ratio (excluding impact of BRSA
measures) >15%
(1) Revised expectation as of August 8, 2022
(2) Return on average equity
(3) Including exchange rate effect
113.9%
25.8%
2.96%
95 bp(2)
21.5%
Realization in 2022
Realization
Targets for 2023
✓⃝
✓⃝
✓⃝
✓⃝
✓⃝
✓⃝
✓⃝
✓⃝
✓⃝
>40%
~30%(2)
>5%
~80%
~80%
<3%
~150 bp
>15%
Financial Performance
and Profitability
İşbank maintains its leading position in its
sector with its strong capital structure and
profitable and successful growth strategy.
The Largest Private Bank in Türkiye
İşbank - the largest private bank in Türkiye - increased its
total asset size to TL 1,408.3 billion in 2022. Performing
above its targets this year, İşbank maintained its
leadership among private banks in terms of the size of
total loans, deposits, and equities during the same period.
İşbank is the private bank that makes the most significant
contribution to the national economy with a total size
of cash loans reaching TL 759.3 billion as of the end of
2022. Loans in TL grew by 75.5%, while loans in foreign
currencies decreased by 10.1% compared to the end of
the previous year, excluding currency impact.
The resources provided by the Bank to the economy
through non-cash loans amounted to TL 246.7 billion
as of the end of 2022. At the end of 2022, 53.9% of the
Bank's total assets consisted of loans, while the ratio
of its securities portfolio to its total assets was 19.8%.
Thanks to its stable growth policy and effective risk
management practices in loan allocation processes,
İşbank achieved an NPL ratio of 3.0% at the end of 2022.
Extensive Customer and
Shareholder Base
İşbank boasts an extensive shareholder base which
consists of nearly 240 thousand individual and corporate
investors. As of the end of 2022, 37.31% of the Bank's
capital was held by İşbank Members' Supplementary
Pension Fund, which has a membership base of
approximately 49 thousand employees and retirees.
İşbank was serving 22.8 million customers as of the end
of 2022.
Widespread Deposit Base
With its broad network of services and diversified digital
contact points, İşbank offers its customers a wide range
of products through various channels and continues to
be the bank of choice among savers. The total size of
deposits of İşbank reached TL 931.1 billion in 2022, with
a 56.3% increase. TL deposits increased by 130.4%
compared to the end of the previous year, while deposits
in foreign currencies decreased by 10.7%, excluding
currency impact. Introduced at the end of 2021 and
widely used throughout 2022, “Exchange rate-protected
deposit accounts” made a significant contribution to the
increase in Turkish currency deposits.
The share of demand deposits in total deposits was
45.5% at the end of 2022. İşbank maintained its
leadership among private banks in terms of the size of
demand deposits, as well as total deposits and deposits
in foreign currencies in 2022.
Diversified Funding Base
Deposits, which accounted for 66.1% of the total
liabilities at the end of 2022, continued to be the primary
funding source of İşbank. İşbank continued to make use
of non-deposit funding sources in domestic and foreign
markets in order to diversify funding sources and extend
the maturity structure of its liabilities by taking funding
costs into consideration. İşbank's non-deposit sources,
which consisted of repo transactions, funds borrowed,
securities issued in domestic and foreign markets, and
subordinated debts, accounted for 12.3% of the total
liabilities at the end of 2022.
Strong and Robust Financial
Structure
The size of İşbank's shareholder equity reached TL
191.4 billion at the end of 2022 with a 120.4% increase
compared to the end of the previous year. Maintaining its
strong capital structure, İşbank's capital adequacy ratio
was 24.4% at the end of the year.
The Bank achieved a net profit of TL 61.5 billion in 2022
with a return on average equity of 46.8% and a return on
average assets of 5.3%.
The Bank's share in deposit markets calculated based
on the monthly sector data dated December 2022 as
published by BRSA:
A total market share of 14.2% in savings deposits,
with 11.3% and 15.7% respectively in Turkish Lira
and foreign currencies
A total market share of 12.5% in the total deposits
market (excluding Banks deposits), with 9.5% and
14.1% respectively in Turkish Lira and foreign currencies.
In Q4 of 2022, consumer loans grew by 9.3% with
an increase of TL 7.3 billion, while credit cards and
total personal loans increased by 9.5% and 9.3%,
respectively, compared to Q3.
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İşbank 2022 Integrated Annual Report 59
Composition of Assets (%)
Cash and Banks
Securities
Loans
Subsidiaries and Affiliates
Other
Total
Composition of Liabilities (%)
Deposits
Funds Borrowed and Money Markets(1)
Other Liabilities
Shareholders' Equity
Total
2022
15.8
19.8
53.9
5.7
4.9
100
2022
66.1
12.3
8.0
13.6
100
2021
22.2
15.4
53.2
4.3
4.9
100
2021
64.3
19.6
6.7
9.4
100
(1) Includes Turkish Lira and foreign currency debt instruments issued and subordinated debts.
Key Financial Items
(TL Million)
2022
2021
Change
(%)
Ranking Among
Private Banks
Total Assets
1,408,323
926,569
Loans
Deposits
Shareholders' Equity
759,289
493,378
931,077
191,376
595,628
86,839
52.0
53.9
56.3
120.4
Key Financial Ratios (%)
Interest-Earning Assets(1) / Total Assets
Loans / Total Assets
Loans / Deposits
NPL Loans / Total Loans
NPL Coverage Ratio
Demand Deposits / Total Deposits
Shareholders’ Equity / Total Liabilities
Capital Adequacy Ratio
Return on Average Equity(2)
2022
88.2
53.9
81.5
3.0
74.4
45.5
13.6
24.4
46.8
(1) Interest-earning assets include Turkish Lira and foreign currency required reserves.
(2) Averages calculated based on quarterly balances.
1
1
1
1
2021
89.3
53.2
82.8
4.1
66.2
47.9
9.4
20.4
18.4
İşbank and
its Activities in 2022
Corporate Banking
International Banking
With corporate banking services, İşbank provides
local corporations and international companies
with services and financing solutions tailored to
their needs.
>⃞■Products and Services: Project Financing,
Risk Management Solutions (Hedging), Digital
Solutions, Cash Flow Products
>⃞■Developments in 2022: In 2022, İşbank
focused on sustainable profitability to respond
to the end-to-end needs of its customers
by considering ecosystem profitability. By
deepening the ecosystem networks of
legal entity customer groups, product and
service infrastructures that digitalize cash
flows, especially through next-generation
digital banking and digital platforms, were
effectively made available to customers.
Innovative models were designed to deepen
the extensive customer base, especially for
regaining customers whose numbers initially
had decreased. As a result of all these activities,
a significant improvement was made in TL
commercial deposits and commission income
items at the end of 2022 compared to 2021.
Despite the volatility in the global and national
conjuncture, in the business unit where TL/
FX cash loan investments were effectively
managed, loan demands were met with a
holistic profitability approach by considering the
right priorities, keeping the asset quality in the
forefront in a way to observe the sustainability of
our current loan portfolio and Bank customers.
In the funding approach, which prioritizes TL/
FX export loans which provide strong support
to the portfolio and asset quality with their
deepening and side income/earnings impact on
the Bank’s customers, their high correlation with
the economic growth activity of our country, and
their relatively short-term structure compared to
other loans, an optimum management approach
was shown regarding loan maturity structures
and durations.
İşbank collaborates with correspondent banks
in processing foreign trade transactions and
payments of its customers, and effectively
manages correspondent bank relations
according to the principle of reciprocity. The
bank also aims to increase its share in the
foreign trade market and obtain funds from
internationalmarkets . In addition to foreign
trade transactions, issuance of letters of
guarantee, wire transfer services and TL account
transactions to be processed in Türkiye upon
demand of customers of correspondent banks,
İşbank also fulfills other service demands in
accordance with the applicable law. In order
to ensure that its customers can complete
their supply processes without interruption by
facilitating their access to appropriate financing
solutions and products according to their needs,
İşbank maintains its efficient and sustainable
collaborations with export insurance, credit
agencies, and other financial organizations.
>⃞■Developments in 2022: As of year-end
2022, İşbank had nearly 1,018 correspondent
banks in 119 countries. Due to global inflationary
pressures and the slowdown in the global
economy, the importance of efforts to provide
resources for customers’ energy efficiency
projects increased.
In parallel with the developments in the
world and in the sector, İşbank secured two
sustainability-linked syndication loans in June
and November 2022, and, within this framework,
set up various performance indicators related to
environmental and social impact, as was done in
the syndication loans secured in 2021.
Within the scope of the securitization program
based on foreign remittance flows (“Diversified
Payment Rights”), the Bank obtained a total of
USD 227 million in funds from the European
Bank for Reconstruction and Development
(EBRD) and the International Finance
Corporation (IFC) in August 2022.
In September 2022, İşbank signed a USD
100 million loan agreement with the Asian
Infrastructure Investment Bank (AIIB) and
realized its first transaction with the relevant
institution.
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İşbank 2022 Integrated Annual Report 61
Capital Markets Transactions
With its subsidiaries in capital markets, İşbank
continues its brokerage services in capital market
instruments such as equity markets, precious
metals, derivatives and investment funds and
offers custody and fund valuation services. As
a customer-oriented bank, it also continues its
product development and infrastructure projects to
meet customer needs in the best way possible.
>⃞■Developments in 2022: To obtain long-term
funding and diversify funding sources, the issuance
of debt instruments was continued in 2022 as well.
In 2022, İşbank continued to issue debt instruments
of different types and maturities in order to provide
long-term funding compared to deposits, diversify
the existing funding structure, eliminate the maturity
mismatch between asset-liability balance sheet
items, and prevent interest rate risk due to short
maturity.
By the end of 2022, İşbank issued domestic
commercial papers and bonds with a nominal
value of TL 4.8 billion through sales to qualified
investors and TL 4.9 billion through public offerings,
contributing to the diversity of TL-denominated
products offered to customers. İşbank maintained
its leadership in the brokerage sector with a trade
volume of TL 1.1 trillion in the Borsa İstanbul Debt
Securities Market as of year-end 2022.
Generating 8.30% of the trading volume in the
Borsa İstanbul Equity Market with its subsidiary İş
Investment as of year-end 2022, İşbank maintained
its position among the leading institutions in the
market.
As of year-end 2022, the number of investment
funds for which custody services were provided
increased by 46% and their size by 121% compared
to the same period of the previous year. The Bank
continues to play a leading role in the sector in
terms of the number of investment funds and asset
management companies it works with.
The investment fund balance, which stood at
TL 25.7 billion at the end of 2021, increased by
93% to TL 49.6 billion in 2022 as a result of the
intense demand of customers seeking returns. In
2023, when this investor interest is expected to
continue, in order to increase asset management
commission revenues and provide customers with
real return opportunities in a negative real interest
rate environment, the Bank aims to organize regular
investment fund sales campaigns together with its
subsidiary İş Portföy Yönetimi A.Ş through its efforts
to develop new products in investment funds, to
improve channel-based customer experience,
and to continuously train and activate sales and
marketing functions. The balance of equities,
which stood out as the investment product in which
customers showed the most interest in 2022,
increased by 207% in 2022, reaching TL 157.5
billion. In addition to the balance, the remarkable
increase in the volume of customer share
transactions in 2022 made a positive contribution
to the Bank’s commission income.
Commercial Banking
In compliance with its mission, İşbank stands by
industrial organizations, tradespeople, SMEs and
other miscellaneous businesses. Being present
at all points of commerce, İşbank offers products
and services that create value for its customers
throughout Türkiye with its widespread branch
network.
>⃞■Products and Services: Business Credit Card,
Maximum İşyerim, POS, ÇekCepte, Instant POS,
Instant Commercial Loan, Instant Commercial
Products, Digital Overdraft Current Account,
Maximiles TIM Exporter Card, Instant Agriculture
Loan, SME Loans, İmece Card, İşim Card, Tarsim,
İmeceMobil, DijiKolay, Denizleri Koruyalım (Let's
Protect the Seas) Loan, Digital Supplier Finance
System, Project Financing, Risk Management
Solutions (Hedging), Digital Solutions
Private Banking
İşbank Private Banking continues to offer customized
investment products according to the needs and
preferences of its customers through its asset
management-oriented business model structured in
cooperation with the Bank’s subsidiaries İş Portföy, İş
Yatırım, and Anadolu Hayat Emeklilik.
>⃞■Products and Services: Asset Management,
Privia Black Credit Card, Privia Investment Fund, Privia
Consumer Loans, Privia Pension Plan, Privia Motor
Insurance, Financial Status Report, Privia Line
>⃞■Developments in 2022: Privia Black credit
card, which is designed to be allocated only to private
banking customers and provides privileged advantages
in luxury brands and companies in line with the
expectations of customers, was offered to customers in
April 2022. By the end of 2022, 70% of private banking
customers with credit cards were allocated Privia Black
credit cards. As of year-end, with the contribution of
the Privia Black credit card, credit card expenditures
of private banking customers increased by 168%
compared to the previous year.
The Bank's asset management-oriented business
model, integrated with its subsidiaries, aims to meet
the needs of customers in all areas of life with high
standards of service delivery. Within this scope,
the Bank adopted an agile working model called
the Subsidiary Desk, which was implemented with
competent personnel from İş Portföy, İş Yatırım, Anadolu
Hayat Emeklilik, and Anadolu Sigorta subsidiaries, and
products and services were offered to customers in a
coordinated manner.
As a result of the work carried out within the framework
of an aligned structure;
ᆔThe total amount of funds managed in cooperation
with İş Portföy increased by 55%, including family
funds.
ᆔParticipation share generation in Anadolu Hayat
Emeklilik products grew by 26%, while the total
amount of savings grew by 76%.
ᆔAnadolu Sigorta premium production grew by 126%.
In line with the strategy of expanding private banking
service points, efforts were accelerated for commercial
company partners in need of asset management, and
it was aimed to improve and deepen the use of money
and capital market products.
In addition, İşbank Private Banking offered its customers
various arts and sporting events throughout 2022,
depending on their tastes and preferences.
İşbank Private Banking was named the best bank in
Türkiye in the Family Wealth Management and Financial
Planning category in the Euromoney Private Banking
and Wealth Management survey in 2022.
Payment Systems
İşbank's activities in the field of payment systems
have a simple goal:to offer ‘‘standing by its customers
with a perfect user experience’’ when they need it.
Therefore, to ensure ease of use of its products and
services for daily use, the Bank tries to understand
the needs of users with an average level of financial
literacy while designing products and services that
will be commonly used.
>⃞■Products and Services: Personal and Business
Credit Cards, Personal and Business Debit Cards,
MaxiPara Cards, İmece Cards, Dealer Cards, Instant
Card Applications, Applications for Money Transfers
Between Cards, Virtual and HCE Cards, Interest and
Fee Applications, Deferred Payment with Interest
and Installment Transactions, Installment Limitations,
Account Statement, Repayment and Duration of
Delay, Points and Miles Applications, Co-branded
Card Applications, Contactless Payment
>⃞■Developments in 2022: The Moka Super
POS (Virtual) campaign, which enables small and
medium-sized companies to make installments to
different bank cards with a single virtual POS, started
to be offered to our customers through our İşCep and
Commercial Internet Branches.
By being integrated with transportation infrastructure
providers in various cities of Türkiye, it became
possible to use contactless credit and debit cards as
transportation cards by scanning them through the
Bank's contracted merchant system.
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İşbank 2022 Integrated Annual Report 63
Cross-Border Banking
İşbank Group carries out its cross-border banking
operations through its branches, subsidiary banks, and
agencies abroad. İşbank has a presence in 11 different
foreign countries. 9 of a total of 33 branches belong
to Frankfurt-based (Germany) İşbank AG, whereas
Moscow-based (Russia) JSC İşbank has 1 and Tbilisi-
based (Georgia) JSC İşbank Georgia has 2 branches.
In addition, there are 2 representative offices in Kazan
and St. Petersburg, which are affiliated with JSC
İşbank. In addition to the aforementioned, İşbank has 2
branches in Iraq, 2 in Kosovo, 2 in the UK, 1 in Bahrain
and 14 in the Turkish Republic of Northern Cyprus
(TRNC). The Bank has 2 representative offices, one in
Shanghai (China) and the other in Cairo (Egypt).
>⃞■Developments in 2022: İşbank stands out in Iraq,
especially with the international banking services it
offers through its Erbil Branch. In addition to mediating
a significant portion of the trade between the two
countries, the Bank contributes to businesses that
generate added value for the region. Through its two
branches operating in Iraq, the Bank also mediates letter
of guarantee transactions addressed to the counterpart
institutions and organizations in the country. In 2022,
the volume of cash loans and customer deposits
increased by 22.76% and 15.73%, respectively.
The year 2022 was a year in which İşbank received
positive results from its activities to collect widespread
deposits and increase the number of customers in Kosovo.
The positive relations established with the Gulf Region
countries through the Bahrain Branch contributed to
İşbank's efforts to diversify its fundingbase.
In 2022, İşbank moved to its new service building in
the UK and continued to offer all banking services
to its customers. The level of relations with London-
based companies was raised, and significant
increases were achieved in contracted merchant
transaction volumes.
Preparations to develop a modern mobile banking
product for İşbank's customers in the UK, Kosovo, and
Iraq were completed. As of 2022, it has been made
available to our customers.
As of year-end 2022, the size of the total assets of
İşbank's organizations based in foreign countries was USD
5.8 billion. The Bank's foreign subsidiaries and foreign
branches account for 37.9% and 62.1% of this figure.
Digital Banking
>⃞■Developments in 2022: The primary components
of digital banking are to engage in contextual
interaction with customers, offer personalized and
innovative services, and provide an end-to-end
seamless experience. The number of İşbank's digital
banking users increased by 27.5% compared to 2021
and reached 13 million. The share of non-branch
channels in transactions increased to 96.16% while
the share of digital channels in sales rose to 65%. In
2022, 20% of the Bank's new retail customers were
acquired end-to-end digitally through our “becoming
a customer remotely” service via the İşCep application.
Together with those who started the process on
İşCep and completed it at the branch, this ratio rises to
29%. In addition, the Nays application, which debuted
on app stores on June 21, 2022, reached 2 million
downloads and 1.4 million registered users, 68% of
whom established a new relationship with İşbank, and
55 thousand users became İşbank customers by the
end of 2022.
In 2022, 87 new functions were added to İşCep.
Among the new functions added to our digital
channels, the most prominent ones were the
renewal of the money transfer and investment fund
screens to maximize the experience, participation
and tracking of card campaigns, mobile contactless
payment, available limit suggestion, money transfer to
cryptocurrency companies, installment commercial
additional account, and Moka Super POS application.
Within the scope of the ongoing developments for
Forest for the Future (Geleceğe Orman) (); leader race,
participation points, carbon point history, and point
earning display in task detail, as well as suggestions to
reduce carbon footprint were activated.
Within the scope of API developments and integration
efforts, the Bank maintained its position as the bank
with the highest number of integrations among
competing banks and continued to be among the
leading banks in terms of API diversity.
Treasury Management
>⃞■Developments in 2022: The Treasury operations
were managed according to the principles of the
Asset/Liability Management Risk Policy, in parallel
to the liquidity, interest and exchange rate risks, the
principles of sustainable profitability, and the Bank’s
risk appetite. Potential risks that may arise from the
interest rate structure and İşbank’s FC position, which
is managed as an important element of the liquidity
composition, were followed up ad-hoc and on a
scenario basis, alongside other interrelated positions.
Effective risk management was exercised by utilizing
derivative products, along with money and capital
markets products depending on market conditions.
İşbank's main goal is to optimize the risk-return
balance and reinforce its balance sheet structure
through a sustainable and profitable growth strategy
by focusing on loan and investment portfolios,
effective use of capital, and dynamic management
of FC and liquidity positions as well as cost control.
Accordingly, the Bank created a flexible balance
sheet composition by taking into consideration all
elements, including expansion of the deposit base,
i.e. the main source of funding, and diversification
of non-deposit sources, optimization of risk-return
balance, and fulfillment of customer needs.
In the first quarter of 2022, the main agenda was
dominated by exchange rate-protected deposits,
in the second quarter by the macroprudential
measures implemented in coordination with the
HMB, CBRT, BRSA and CMB, and in the third
quarter by the increase in the weight of these
measures and additional liabilities introduced as
part of the “Liraization” strategy. Loan, collateral, and
liquidity policy steps focused on strengthening the
effectiveness of the monetary policy transmission
mechanism had an impact on the balance sheet
management decisions of banks.
Personal Banking
İşbank's activities in the field of personal banking
are shaped around the principal target of "becoming
the customers' financial solution partner of choice
in every stage of their lives”. The Bank's operations
are built on a single strategy: to obtain a timely and
accurate understanding of the customers' needs in
order to offer them the best possible solution and
experience.
>⃞■Products and Services: Remote Customer
Acquisition, Private Pension for My Child, Exchange
Rate-Protected Deposits, Artificial Intelligence-
and RPA-assisted applications, real-time analytic
application development, Remote Customer
Management, Forest for the Future
>⃞■Developments in 2022: 21% of our new
customers were acquired through the end-to-end
digital remote customer acquisition method. With
175 thousand participants under the age of 18 in
the Private Pension System, İşbank maintained its
position as the sector leader.
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İşbank's Subsidiaries
Customer Centricity
As an integrated group, İşbank has acquired many
subsidiaries in line with its mission to support the
industrial and economic development of Türkiye.
İşbank's Subsidiary Policy involves:
Strengthening the strategic perspective on the
activities of current subsidiaries on a corporate level
by taking risk/return balance and market conditions
into consideration,
Pursuing growth for all subsidiaries, from those newly
incorporated to mature ones, through organic and
inorganic methods, and
Ensuring that our companies are among the
pioneering and leading companies in their respective
sectors and increasing their market value.
As of year-end 2022, the Bank directly and indirectly
holds shares in 136 companies, 113 of which are
controlled by the Bank. The Bank directly holds shares in
29 companies.
These companies accounted for TL 82.8 billion of the
Bank's total assets as of the end of the year. Türkiye Sınai
Kalkınma Bankası A.Ş., Anadolu Hayat Emeklilik A.Ş., İş
Finansal Kiralama A.Ş., İş Gayrimenkul Yatırım Ortaklığı
A.Ş., İş Yatırım Menkul Değerler A.Ş., and Türkiye Şişe ve
Cam Fabrikaları A.Ş. represent 73.9% of this subgroup
of the Bank's assets and are publicly traded on Borsa
İstanbul. Anadolu Anonim Türk Sigorta Şirketi, İş Girişim
Sermayesi Yatırım Ortaklığı A.Ş., TSKB Gayrimenkul
Yatırım Ortaklığı A.Ş., and İş Yatırım Ortaklığı A.Ş. are
the other publicly-held Group companies controlled by
İşbank through indirect shareholding.
As of year-end 2022, the portfolio accounts for 5.9% of
İşbank's assets. İşbank's subsidiaries operate in the USA,
Germany, United Arab Emirates, Bosnia and Herzegovina,
Bulgaria, China, Georgia, India, Netherlands, England,
Spain, Italy, Hungary, Egypt, Romania, Russia, Slovakia,
Ukraine, Singapore and TRNC.
For the performance of our subsidiaries in 2022,
please visit the section “İşbank’s Subsidiaries”.
AG
TRAKYA YATIRIM
HOLDİNG
Acting in line with its strategy of “being the closest bank
to customers”, İşbank focuses on customer experience in
all its systems and processes and continues its activities
with the goal of being a reliable, easy to work with
business partner that its more than 22 million customers
can access when required.
Customer Satisfaction
Understanding the changing needs and expectations
of customers and striving to ensure unconditional
customer satisfaction through innovative, fast, and
user-friendly solutions, İşbank monitors customer
satisfaction levels throughout the year through various
channels and methods.
İşbank’s customer satisfaction and Net Promoter
Score (NPS) are compared with peer banks through
independent research companies. According to
the results of individual NPSsurveys conducted by
independent research companies, İşbank managed to
maintain its leadership in this area in 2022 as well.
In addition to the support of the research company,
continuous measurement studies are being carried out
using İşCep in-app NPS surveys, end-of-transaction
effort/satisfaction surveys, and expectation surveys
via e-mail/phone. In addition to digital channels
and channels such as e-mail/SMS, satisfaction
measurement studies are also conducted through
physical media such as in-branch kiosk surveys and
photoblocks. In measurement studies, feedback is
collected by displaying surveys to customers at the
end of their transactions, including customer journeys,
and single transactions and workflows which result in
Over 4 million customer
feedback responses have
been obtained so far in digital
measurement studies. 2022
İşCep Net Promoter Score was
57%, Branch Satisfaction Score
was 76%, and Bankamatik ATM
Satisfaction Score was 86%.
an error; this feedback is used in the development and
presentation of new products/services.
In 2022, next-generation analytical capabilities were
acquired to improve the service experience on digital
channels that have become customers’ primary touch
point and to offer real-time contextual suggestions and
guidance to customers on digital channels, especially
İşCep. For this purpose, analyses based on behavioral
data of customers were conducted, and more than 70
million interactions were created in 2022. While correct
suggestions and guidance were offered to customers
in times of need through these interactions, solutions
were created for smooth completion of transactions
in challenging situations. Customers submitted 1.2
million product applications, and they were provided
with guidance to ensure that more than 3 million
transactions could be seamlessly performed via digital
channels.
In 2022, the “Net Promoter Score” of Private Banking
customers was measured through a survey conducted
during the year, and the satisfaction score was realized
as 69✓ Customer feedback was used as input
in product and service development and delivery
processes.
The satisfaction score was measured as 73% in 2018,
74% in 2019, 78% in 2020, 82% in 2021, and 76% in
2022 over the kiosks and QR-coded Photoblocks in
the branches. The decrease in branch transactions
during the pandemic had a positive impact on
customer satisfaction in 2020 and 2021. Branch
experience is monitored in terms of employee interest,
transaction speed and transaction quality, Bankamatik
ATM experience in terms of device cleanliness and
menu convenience, and İşCep experience in terms of
application speed and menu convenience. In line with
customer feedback, actions are taken to improve the
experience in our channels.
İşbank closely monitors changes in customer behavior,
expectations and consumption habits and carries out
various projects and practices to respond proactively to
this change. Accordingly, in 2022, an Advertising and
Brand Health research study was conducted through
an independent research firm to see the effects of the
Bank's advertising activities related the Bank's core
banking products and payment systems products on
the Bank's customers and other bank customers and to
measure the perception of the Bank and its Maximum
brands. The results of the research were shared with the
Bank on a weekly, monthly and quarterly basis.
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Customer Feedback
İşbank collects customer feedback through channels
such as its corporate website (www.isbank.com.tr),
Internet Branch, İşCep, call center, branches, e-mail,
fax, letters, official institutions and organizations, and
social media. Applications submitted by the customer to
the Bank are evaluated within the Customer Relations
Platform (MIP) and efforts are made to find solutions as
quickly as possible. Customers' demands and complaints
on social media and other online platforms are also closely
monitored.
The actions taken by the head office divisions to
improve the customer experience are presented to the
Board of Directors quarterly, together with a report on
the distribution and course of customer requests and
complaints.
As per legislation, the number of applications submitted
by financial consumers in the form of objections
or complaints that involve issues, grievances or
dissatisfaction with the individual products and services,
as well as the breakdown of such applications on a
per-subject basis and the associated resolution times,
are reported to the BRSA quarterly, and this data is also
submitted to the Banks Association of Turkey (BAT) at
the same time. The data submitted by banks is then
consolidated by BAT and communicated to the member
banks quarterly.
The cumulative number of complaints received by
İşbank for 2022 is 312 thousand, and the Bank ranks 3rd
among member banks of BAT.
Statistical data and explanations regarding the content
and distribution of customer requests and complaints
submitted to the Bank and the responses given to
customers are reported to senior management quarterly.
In 2022, 207,117 customer complaints were received.
In 2022, Customer Relations Program (MIP) received
192,531 applications.
In 2022, İşbank Call Center received 20 million calls
and has held the EN ISO 15838 "Call Communication
Centers Standard" Certificate since 2011.
In 2022, İşbank received
nearly 748 thousand
feedback responses from
various channels, and 92%
of this feedback, remaining
after excluding duplicate
and non-response
applications, was addressed
through the MIP.
Changes to Existing Products and
Services as a Result of Customer
Feedback
With the SoftPOS infrastructure, Pos’um Cepte,
which transforms Android mobile phones and tablets
into POS devices, was provided with multi-terminal
and employee feature functions; thus, the mobility of
the application was increased by enabling company
employees to receive payments without the
requirement of being a Bank customer.
Credit card customers logging in to İşCep were
offered pre-approved credit card limits; the
application enabled a limit increase of TL 3.1 billion in
one month.
Customers started to be informed via SMS and Push
before the expiration of the MaxiPoints they earned
from campaigns. Customers using Advance MaxiMiles/
MaxiPoints started to be informed a certain period
before the end of the advance closure date. Within
the scope of Maximum Mobile/Pazarama activities,
MaxiMiles and MaxiPoints were made available for
hotel payments on the Pazarama Tatil page.
The “Invoice saving” feature was introduced to İşCep
and credit payment plan information was added in
accordance with customer requests. It was made
possible to change the credit card delivery address
on İşCep. In investment fund purchase transactions,
fund details and portfolio breakdown were displayed,
and display of pensioner promotion information and
renewal was enabled.
Informing Customers
In line with the responsible banking and customer
centricity approach, İşbank provides its customers
with accurate and up-to-date information in an open
and transparent manner through various channels.
Explanations regarding the Bank's products and services
are made in a way to include all the details the customer
needs about the product and service, especially legal
requirements. The Bank makes investments to develop
the skills of those employees who, directly or indirectly,
offer customers such information in this area.
In 2022, the Bank did
not incur any penalty
due to non-compliance
with regulations on
customer information
requirements.
Customer Information Channels
New products and services to be made available
to customers via digital channels are shared with
the İşbank Phone Banking teams to be announced
to customer representatives to prepare them for
potential customer inquiries before such products
and services are delivered.
New products and features to be added to İşCep
are explained in the description field in the app store.
In addition, videos are posted about the Bank's
products, campaigns, and services in the Stories
section of İşCep.
Guidance messages are displayed to customers
in digital channels. Regarding the potential errors
or problems encountered in digital channels, the
customer relations service and the call center are
immediately notified to ensure that proper guidance
is provided and that the errors and problems are re-
directed to the related divisions.
Communication campaigns such as mailing,
advertisement and announcement are carried out to
inform customers about digital channels. The Bank's
corporate website provides detailed information
about the digital channels, transaction sets and
security practices.
Private banking customers are given information in
person about products, services, and investment
alternatives. Customers can also get detailed
information about products and services by visiting
privia.com.tr.
SME and Enterprise Banking customers are provided
with up-to-date information about products and
services through customer visits and various
channels including İşCep, the corporate website,
corporate social media accounts, Maximum İşyerim
application, İŞ'TE KOBİ website, ATMs, e-mail, and
SMS.
QR Codes are included in printed brochures, posters,
newspaper and magazine adverts to ensure that
customers can access detailed information about the
product in question by visiting the corporate website.
In addition to the application instructions used for
providing information to customers at branches,
İşbank also publishes all the details needed about its
products via its corporate website isbank.com.tr.
Product information forms are available for special
deposit products that are non-standard in personal
banking.
Agricultural Banking customers are kept up-to-
date about products/services through digital
channels, especially İşCep, the corporate website
and Maximum İşyerim application, and e-mail,
Bankamatik ATMs, SMS channels, and customer
visits.
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Responsible
Products
and Services
With its responsible product and service
offering approach, İşbank develops
products and services that take into
account the different life stages, economic
needs, and sectoral requirements
of its customers, and that are easy
to understand, encourage savings
awareness, cover all segments of society,
and aim to increase financial literacy.
All products and services of İşbank are evaluated within
the scope of risks that may be exposed, due to products,
services or activities defined in the Bank's legislation.
During the master plan studies for 2022, in order to
ensure products, services, and activities to be developed
are evaluated from a sustainability point of view, an article
that allows a product's environmental and social benefits
to be questioned and whether the product supports
sustainability activities has been added.
Responsible Marketing
İşbank accepts it as a key responsibility
to provide its customers with consistently
accurate, transparent, and clear information
about its products and services. With a
customer-oriented approach, the Bank offers
its customers information that facilitates
their decision-making process and meets
their requirements and informs its customers
thoroughly and accurately about the benefits
and risks that may arise. Communication
does not include misleading, complex,
and contradictory statements or duplicate
information. For İşbank’s responsibility and
working principles, please review “Ethical
Principles and Operational Rules”.
Products and Services for Increasing
Awareness on Savings
Aiming to promote saving awareness
in all segments of society, İşbank
maintained its position as the bank with
the largest deposit base among private
banks in the third quarter of 2022 as well.
As of year-end 2022, total deposits grew
by 56.3% to reach TL 931.1 billion.
Üstü Kalsın (Keep the Change)
Offering customers the opportunity to save money
without changing their shopping habits, the Üstü Kalsın
(Keep the Change) application transfers the difference
created by the customers with credit cards and
investment accounts to round up their credit card debt to
a higher amount of their choice to be deposited into an
investment savings account. As of December 2022, the
number of investors using the application reached 124
thousand, with a total fund size of TL 90.7 million.
Digital Moneybox
Introduced for those under the age of 18 to be able
to save money through digital channels, the Digital
Moneybox is the digital form of the Classic İşbank
Moneybox, one of İşbank's iconic products.
Moneybox Hybrid Fund
The Moneybox Hybrid Fund is a “savings” fund that
contributes to investing in the future of children today
and creating awareness on saving at an early age. Being
the first investment fund developed for children, the
Moneybox Hybrid Fund ranks first among similar funds
in the sector in terms of number of investors. As of the
end of December 2022, the Moneybox Hybrid Fund had
nearly 141 thousand investors and an investment size of
nearly TL 851 million.
Gold Banking
At İşbank, customers are offered the opportunity to save
money with Time or Demand Deposit Gold Account
options. Gold Meetings are also held at branches in
order to bring the so-called “under the mattress savings”
into the banking sector and to secure precious jewelry
against the risk of loss and theft. There is also integration
with the Jewelry Gold Valuation System (KAD-SİS). Gold
or jewelry items brought by customers are deposited into
the Demand Gold Account in grams of gold.
Robofon
The Robofon Consultancy service, managed by İş
Portföy, provides fund consultancy services to clients
who wish to save even small amounts. The Investor
Profiling Module of the Robofon Consultant, made
available at İşCep and the Internet Branch, analyzes
the investor's current financial situation and needs
and determines their risk perception. At the end of the
process, the most suitable fund for the individual is found
among the Robofon Family. Fund consultancy services
were successfully provided in 2022, as well, and the total
number of customers completing the investor profile
questionnaire and receiving fund advice exceeded 210
thousand.
İşCep Personal Finance Management
İşCep Personal Finance Management allows customers
to view their assets in the Bank as well as their assets
in Anadolu Hayat Emeklilik and İş Yatırım from a single
location and to easily control their financial transactions.
Thus, while keeping their payments and expenditures
under control, customers can also direct their savings.
Regular Savings Order
With the aim of directing not only assets of a certain
amount but also small savings to regular savings, the
Regular Savings Instruction service was introduced to
İşCep in 2022, enabling customers who invest their
savings in time deposit products to make one-time or
regular transfers from their demand deposit accounts to
their time deposit accounts at maturity.
Maximum Time Deposit Account
Maximum Time Deposit Account secures automatic
payments of individual customers who want to invest
their savings in the short term while earning overnight
interest on their deposits.
Daily Earning Account
The Daily Earning Account, which can be opened
via İşCep or Internet Branch, offers customers the
opportunity to utilize their savings on a daily basis
compared to long-term accounts. As of the end of 2022,
the Daily Earning Account balance amounted to TL 3.3
billion.
Exchange Rate-Protected Deposit Account
At the end of December 2021, within the “Communique
on Encouraging Conversion of FX Deposits to TL Time
Deposit and Participation Accounts” published in the
Official Gazette, 2 different products, “FX-Protected TL
Time Deposit Account for Customers Converting from
FX” and “FX-Protected TL Time Deposit Account” were
made available to customers to protect their savings
against fluctuations in exchange rates and to support
financial stability by increasing the share of TL deposits
in total deposits in the banking system. In 2022, “FX-
Protected TL Time Deposit Account for Customers
Converting from Gold” and “Deposit Account for Citizens
Residing Abroad” (YUVAM) and FATSİ accounts were
also introduced in accordance with the additional
regulations issued by the Central Bank of the Republic of
Türkiye (CBRT). Account types other than FATSI, which
can only be opened at branches, can also be opened via
İşCep and Internet Branch. Total Balance of FX-Protected
Time Deposit Accounts was TL 130 billion at the end
of 2022. Excluding bank deposits, savings invested in
FX-Protected TL Time Deposit products accounted for
13.64% of the Bank’s total deposits in the first twelve
months.
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In large-scale infrastructure investments are financed
by İşbank, corporate social responsibility budgets are
allocated to projects to eliminate or mitigate potential
negative impacts that may arise due to investments, and
positive impacts are increased by developing processes
for the benefit of stakeholders in the impact area of
the projects. In particular, loss of livelihoods due to land
acquisition and forced resettlement are among the most
common impacts of investments. Individuals and groups
affected by the project are identified and classified
through the “Replacement Plan” and “Restructuring of
Livelihoods” plans, and appropriate action is taken to
eliminate impacts.
For highway projects, the Bank developed various social
responsibility projects such as upgrading the roads,
schools and water pipelines in villages located along the
route of the highway, donating agricultural machinery,
providing seed support, offering art development training
programs for women stakeholders and supporting
education via specific annual budgets for villages that
rely on agricultural activities.
The most common impacts of financed investments
include loss of livelihood and forced resettlement due
to land acquisition. As a result of the expropriation or
consolidation of privately owned lands in a number
of investments, some households were subjected to
compulsory replacement or significant loss of livelihoods
due to the relocation of workplaces. For those projects
subject to financing at international standards, individuals
and groups affected by the project were identified
and classified through the “Replacement Plan” and
“Restructuring of Livelihoods” plans, and appropriate
action was taken to eliminate impacts.
Tailored "Private Hedge Funds"
The expectations of private banking customers, who
have a high level of knowledge about financial products
and high return expectations in the areas of professional
asset management and investment instruments that
provide an optimal risk/return balance offered by
expert staff, were met through forward exchange funds,
personalized hedge funds, and family funds that provide
intergenerational wealth transfer in a return-oriented
manner.
Human Rights and Social Impact
Evaluations in Investment and Loan Activities
In İşbank's investment and loan activities, human rights
and social impacts are taken into account as well as
environmental impacts, and practices are requested to
eliminate human rights violations and negative social
impacts.
In the risk assessment model used for human rights and
social impacts, there are variables related to matters such
as child and forced labor, community and occupational
health and safety, working conditions, job conditions,
OHS management systems, forced resettlement, loss of
livelihoods, stakeholder communication, gender equality,
sexual harassment, and discrimination.
Investments that are to be financed by the Bank and
assigned the risk score A (high risk) based on the
Environmental and Social Risk Evaluation are subject
to an impact evaluation, including the Social Impact
Assessment (SIA), in accordance with the requirements
of international standards.
“Public Participation Meetings” are held in all investments
that require local EIA as a minimum, and additional
stakeholder communication meetings and corporate
social responsibility activities are carried out within the
scope of stakeholder participation in all financing subject
to environmental and social risk assessment.
Financial Literacy
In order to increase financial literacy within society to
enable customers to make the right decisions regarding
their financial assets and increase trust in the financial
sector, İşbank aims to increase the level of financial
literacy of every segment of society and every customer
from each segment.
Blog posts and training content were published on the
İŞ'TE KOBİ website, www.istekobi.com.tr, in order to
improve the financial literacy of tradespeople, women
entrepreneurs, SMEs, entrepreneurs, and farmers.
Additionally, the İŞ’TE KOBİ website includes a specific
area where visitors can ask questions and receive
answers from experts about various topics such as
taxation processes, how to incorporate a new company,
and benefits for women entrepreneurs.
Financial literacy workshops are organized at the İşbank
Museum.
The Bank carries out activities to increase the financial
literacy of women in particular. In line with these efforts,
in 2022;
Under the WeLead (Leading Women
Entrepreneurship for Accelerating Development)
Project carried out in cooperation with TÜRKONFED,
face-to-face trainings on Introduction to E-Commerce,
Entrepreneurship, Digital Marketing, Sales in
Marketplaces, and Gender Responsive Procurement
were held in various provinces of Türkiye, while online
trainings were provided on Company Establishment
and Taxation, Entrepreneurship, Introduction to
E-Commerce, E-Accounting, E-Invoicing, Micro
Export, Trademark, Patent and Design, Quality
Process Improvement and Process Development, and
Facebook Ad Panel.
In the Entrepreneur and Investor Academies and
Business Workshops organized in cooperation with
the Arya Women Investment Platform, the Bank
continued to offer training series that contributed to
the financial literacy of women entrepreneurs free of
charge.
Financial Literacy and Marketing Training was
provided for the Amesia Bee Women's Cooperative.
Within this scope, 14 women benefited from the
training opportunity.
Local farmer meetings are held every year to improve
the digitalization and financial literacy of farmers.
In 2022, 7,000 farmers were reached through
39 meetings. Additionally, with the “ImeceMobil”
application, which can be downloaded free of charge,
financial, digital, and agricultural literacy support is
provided to farmers.
Economic Research
İşbank's Economic Research Division closely monitors
cyclical, structural and macroeconomic developments
in both the national and global economy and prepares
periodic reports. These include “Daily Market Bulletin”,
“Weekly Bulletin” and "Monthly Economic Review".
The Division also analyzes important data regarding
the Turkish economy economy and shares them
on its website at ekonomi.isbank.com.tr. “Data
Analyses” reports consisting of Economic Growth,
Inflation Developments, Budget Balance, and Balance of
Payments are published monthly within this scope.
In 2022, 6 Recent Sectoral Developments bulletins
and 12 sectoral reports were published. The sectoral
reports were about agriculture, agricultural foods for
export, cereals, snacks food, passenger transportation,
maritime transportation & ship and yacht building,
electricity, road freight transportation, steel, non-ferrous
and precious metals, construction and logistics
real estate & infrastructure projects and overseas
contracting sectors. In addition, the impact of the
Green Deal on sectors and the “Sectoral Expectations
for 2022” reports published in February were
presented to all stakeholders of the Bank. In addition,
the “Consumption Expenditures By Sectors” study is
updated and published on monthly basis.
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Financial Inclusion
İşbank aims to increase and ensure fair
distribution of social welfare by developing
products and services for all segments of
society.
SME Banking
Digital Anatolia
The Digital Anatolia project was launched in 2018 in
cooperation with TÜRKONFED in order to contribute
to the digital transformation of Anatolian SMEs
producing in Anatolia and to determine a roadmap for
digital transformation on a sectoral basis. Within the
project, online broadcasts focused on digitalization and
sustainability are organized for SMEs with the participation
of senior executives from leading companies in the sector
and experts in their fields.
The live broadcasts of the Digital Anatolia meetings
reached a total of 13,251 individual viewers in 2022.
By adding the recordings to the YouTube account, a
comprehensive archive is created, and more people are
reached in the digitalization of SMEs.
DijiKolay
DijiKolay was launched in 2021 to address the
expectations and needs of SME and Business segment
customers regarding digitalization with a holistic approach,
bringing together solutions that include the products,
services and applications of digital service providers and
the Bank's existing digital transformation campaigns and
services in a single location.
In 2022, the Bank worked towards enriching the products
and services included in DijiKolay, making DijiKolay a
"live service" that addresses customer expectations and
thus contributes to the digitalization efforts of the Bank's
customers and firms in the sector, managing customer
experience in a positive manner and acquiring new
customers.
İŞ’TE KOBİ
İŞ’TE KOBİ website, which was established in 2009,
was provided SMEs with the most up-to-date sectoral
information and news they needed in 2022. They were
also able to digitally access trainings on a wide range
of topics such as e-commerce, entrepreneurship,
technology, marketing and sales, human resources, and
leadership. In addition to SMEs, content was also offered
in the segments of tradespeople, entrepreneurs, farmers,
and women entrepreneurs.
To date, over 7 thousand news reports and over 4
thousand videos, articles, and training content have been
presented on the website, directly contributing to the way
they do business. İŞ’TE KOBİ iewed more than 21 million
times by 10 million visitors, İŞ’TE KOBİ was viewed 410✓
thousand times in 2022.
Collaboration with KOSGEB
İşbank contributes to SMEs' access to financing and
supports tradespeople in areas affected by natural
disasters via support programs co-executed with the
General Directorate of KOSGEB (Small and Medium
Scaled Industry Development and Support Directorate
ofTurkey).
Accordingly, as part of its natural disaster relief programs,
loan disbursements under the protocols signed in
2021 for Edirne, Artvin, Düzce, Rize, the provinces of the
Western and Central Black Sea Region, and the districts
of Van affected by floods and forest fires, as well as
Istanbul İkitelli OSB Emergency Support Loan Protocols
also continued in 2022. Protocols were also signed for the
Emergency Support Loan for the Tuzla district of Istanbul
province and the KGF Supported SME Financing Support
Program with Employment Commitment. As part of these
supports, 167 disbursements of TL 264,288,800 were
made. Additionally, the Bank continued to offer loans
under the "KOSGEB SME Finance Support Program
Protocol" signed in 2021, lending TL 95,127,000 through
1,517 individual loans. Within the scope of the Support
Campaign for Tradespeople and SMEs, TL 5 billion of
financing was provided.
Exporter Card & Maximiles TIM Exporter Card
İşbank launched the “Exporter Card” in 2016, a first in
the industry for exporting SMEs. Thanks to the this card,
export companies both benefit from all the features of
company credit cards and earn MaxiPoints from the
export transactions that they carry out through İşbank.
The number of Exporter Cards and Maximiles TIM
Exporter Cards increased from 8,648 at the end of 2021
to 10,371 at the end of 2022.
Protocol with the Türkiye Exporters Assembly
As of year-end 2022, the total
amount of financing provided to
SMEs in cash and non-cash loans
reached TL 243.9 billion✓.
(TIM) and Export Support Loan Campaign
Loan rates are offered within the scope of the “Exporter
Support Protocol” signed between İşbank and the
Türkiye Exporters Assembly (TIM) in order to finance
exports, which includes various loan types such as
"Female Entrepreneur Export Support Loan" and the "Fair
Participation Export Loan”. Within the scope of the relevant
protocol, a total of USD 44.6 million was disbursed to
exporter companies in 2022. With the placement of
USD 91.7 million provided under the Export Support
Loan Campaign, another special campaign organized
by the Bank for exporters, a total of USD 136.3 million
was disbursed in 2022 within the scope of these two
campaigns.
Support to the Agricultural Sector and
Farmers
In line with the Sustainable Development Goals, İşbank
carries out activities that bring together agriculture
and technology with an innovative perspective and
support the financing needs arising at this point with the
most appropriate methods, contributing to increased
productivity in agriculture.
Thanks to the "ImeceMobil" application, which has 190
thousand users, financial literacy and income-expense
tracking support is provided to farmers, and farmers
can make İmece Card and agricultural loan applications
without going to a branch. In addition, satellite services
and expert-assisted special services available for use in
the ImeceMobil application, which can be downloaded
free of charge, enable farmers to monitor the condition of
their lands and the health of their crops. The application
also prevents excessive fertilization that pollutes the
environment by offering fertilization suggestions and helps
farmers avoid incorrect irrigation practices by making
irrigation suggestions to reduce water use, allowing them to
control costs and achieve better crop yields. 4,500 farmers
benefited from services specific to sustainable agriculture
such as irrigation, fertilization, and satellite, an area the size
of 40,000 football fields was saved from over-fertilization,
enough water to fill 8,500 Olympic-sized swimming pools
was saved, and these services were used at a total of
120,000 decares of land, increasing the yield of these fields.
Thanks to the recommendations given to farmers as well
as the data obtained from 30 agricultural monitoring and
forecast tools granted to them under the Digital Agriculture
project led in collaboration with Vodafone Business,
a decrease in the use of inputs, including agricultural
fertilizers, pesticides and water, an increase in productivity
and a decrease in environmental waste continue to be
achieved. The project provides early warning, irrigation,
fertilization, and spraying recommendations. The project,
which has been carried out by İşbank and Vodafone
Business since 2019, won an award in the Corporate
Collaboration category at the Sustainable Business
Awards 2022.
The Workup Agri Agriculture Entrepreneurship Program,
which was launched to improve the value proposition
offered to agricultural customers and contribute to the
country's agriculture with sustainable solutions in the field
of digitalization, offers trainings, mentoring support, and
cooperation opportunities to agricultural entrepreneurs.
The Workup Agri program won the “Golden Sardis” award
in the category of Innovative Acceleration and Incubation
Programs.
Awareness-raising activities such as Farmer Meetings
and Agricultural Banking Seminars at Universities have
reached 20 thousand farmers and 900 students. .
The total amount of cash commercial loans extended to
the agricultural sector is TL 19.9 billion.
In 2022, as part of the activities were carried out for the
agricultural sector and farmers;
1,355 farmers utilized the Instant Agricultural
Loan product, which was launched as a first in the
sector and enables end-to-end agricultural loan
disbursement through digital channels.
The “Instant İmece Card” product, which allows farmer
customers to be allocated a İmece Card up to TL
50,000 from İşCep, was made available to customers
as of December 2022.
With the help of irrigation system loans, pressurized
irrigation systems were installed on nearly 1,900
decares of dry farming areas, enabling producers to
use resources efficiently and achieve 45% higher
crop yields, while 3.3 million m³ of water savings and
a 24% yield increase were achieved by financing
pressurized irrigation systems installed on 3,175
decares of wild irrigation areas. In addition, pressurized
irrigation systems installed on 10,597 decares of land
were renewed, ensuring the continuation of resource
efficiency and yield increase.
Within the scope of sustainability criteria, “İmece
Workshops” were organized in order to present
common methods that are protective for both nature
and producers, identify common solution proposals
for each stakeholder, and strengthen the agricultural
ecosystem in the country and the Bank’s position
within this ecosystem.
With the number of active female farmer customers
increasing by about 30%, İşbank extended a total of TL
274.3 million in loans to female farmers during 2022,
while the total loan balance on female farmer customers
increased by 82% to approximately TL 896 million.
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İşbank 2022 Integrated Annual Report 75
The Saruhanlı/Manisa Branch was reorganized and
started to serve as the first agriculture specialized
branch of İşbank as of June 16, 2022, within the
scope of the efforts to expand agriculture specialized
branches in markets where Türkiye’s agricultural
activities are predominant. The branch has 54 solar
panels on the roof to generate electricity from solar
energy, meeting all the electricity needs of the branch.
İşbank received the “Golden PSM” award at the PSM
Awards in the Innovative Customer Interaction and
Experience category for its First Agriculture Specialized
Branch, Saruhanlı/ Manisa Branch. With the events
organized at the branch, producers were brought
together with prominent people in the sector, mutual
evaluations were made about the sector, and the
financial literacy of producers was improved.
In addition to the existing mobile vehicles, 2 Mobile
Branches, including Bankamatik ATMs, were put into
service in order to deepen agricultural banking field
activities and to produce on-site, instant solutions to
needs. Some of the electricity needed for the Mobile
Branch vehicles is provided by solar panels.
The İmece Platform was developed to enable
stakeholders in the agricultural ecosystem to carry out
their financial and operational processes end-to-end in
the digital space, and pilot installations of the platform
were realized. Integrations such as mobile application,
cash management, and application routing were
initiated.
The Agricultural Banking Advisory Board was
established and held its first meeting on 30.09.2022 in
order to contribute to İşbank's strategy by monitoring
developments and technological innovations in
agriculture, food, and related sectors in the world and
Türkiye. Action suggestions were included in the 2023
work lists.
The 44th “İş’le Buluşmalar” event was held in Izmir
with the theme of “Sustainability in Agriculture and
Technology” with the wide participation and intense
interest of agricultural sector stakeholders.
Supporting Women's Participation in the
Economy
İşbank believes that the participation of women's
businesses in the economy and increasing women's
employment play a key role in realizing sustainable
development. To this end, the Bank increasingly uses both
its own resources and foreign funds to support female
enterprises.
fund in Türkiye based on gender equality in business
life, launched in cooperation with İş Portföy (İş Asset
Management), a subsidiary of İşbank, and the Center for
Gender Studies at Koc University (KOÇ-KAM). The “İş
Asset Management Women Equity Fund” aims to pave
the way for women to create more value in economic life
and to support research that will enable women to have a
greater say in employment and management.
When selecting companies to be included in the fund,
various criteria are taken into consideration such as having
at least one female board member, having women in
decision-making positions, and providing other public
information content generated under the KOÇ-KAM
consultancy. Domestic equity shares of companies
meeting at least two of the above criteria can be included
in the pool of equities in which the Fund can invest. The
criteria defined by KOÇ-KAM include having a female
employment rate above the mean female employment
rate in Türkiye, fostering a balanced private-business
life, embracing gender equality and equal pay policies,
adopting a fair approach in recruitment processes and
supporting social gender equality projects.
The Fund invests in equity shares of domestic
companies that employ women on an equal basis
and attaches importance to ensuring women hold
management positions. Half of the revenue generated
by the Fund is transferred to research and scholarship
recipients through the “KOÇ-KAM UNESCO Chair -
İşbank Women's Studies and Women's Leadership
Scholarship Program”.
The İş Asset Management Women Equity Fund
was awarded the Sardis Grand Prize in 2021. The İş
Asset Management Women Equity (TL) Fund won
the Sustainable Business Award in the “Women's
Empowerment” category in 2022 at the Sustainable
Business Awards, where innovative projects that create
significant impact on economic, social, and environmental
issues and protect our common future are awarded.
Women’s Banking
Within the Women's Banking program, the existing
processes, products and services are reviewed, aligned
with the expectations and needs of women customers,
and various value propositions are offered in order to
increase the depth of the female customer portfolio and
work with the Bank and to make the Bank's practices
more accessible.
İş Asset Management Women Equity Fund
In 2022, 13,000 new investors joined the “İş Asset
Management Women Equity Fund”, the first investment
Within this scope, customer satisfaction and Net Promoter
Score are also measured and regularly monitored on a
gender basis. The Personal Banking NPSscore for female
participants was reported as 39 in 2022.
İşbank carries out activities to increase the financial
literacy of women in particular. In line with these efforts, in
2022;
employees working in the sales service at the branch.
In this way, the opportunity to make video calls was
extended to corporate mobile phones.
ᆔUnder the WeLead (Leading Women
Entrepreneurship for Accelerating Development)
Project, face-to-face trainings on Introduction to
E-Commerce, Entrepreneurship, Digital Marketing,
Sales in Marketplaces, and Gender Responsive
Procurement were held in various provinces of Türkiye,
while online trainings were provided on Company
Establishment and Taxation, Entrepreneurship,
Introduction to E-Commerce, E-Accounting,
E-Invoicing, Micro Export, Trademark, Patent and
Design, Quality Process Improvement and Process
Development, and Facebook Ad Panel.
Enabled Banking
İşbank endeavors to ensure that all its service areas are
accessible to disabled users.
Verbal and visual directional aids, tactile paving,
wheelchair ramps, and Bankamatik ATMs suited for use
by disabled customers are available at the branches.
649 branches have tactile surface applications, 459
of which are suitable for visually impaired access. In
Bankamatik ATMs, SMS messaging with headphones
and tactile surface support is implemented, and features
are regularly improved. Audio menus in Bankamatik ATMs
are designed in accordance with the standards set by the
Banks Association of Türkiye. 93% of ATMs are suitable
for use by visually impaired customers.
In order to facilitate access to branches for customers
with orthopedic disabilities, the differing elevations at the
entrances of 811 branches were removed in 2022, and
488 branches were made suitable for orthopedically
disabled access. İşbank ensures that there is at least one
Bankamatik ATM that is suited for use by orthopedically
impaired people in each province where it has
orthopedically impaired customers, and if there is more
than one ATM at the front of a branch, one device is made
suitable for disabled access.
Special staff members are employed at İşbank's Call
Center to allow hearing-impaired customers to receive
services at the Bank's branches by communicating via
video call. In 2022, “softphone” authorization was granted
to the assigned corporate mobile phones of authorized
Customers' suggestions and requests regarding the
installation of new Bankamatik ATMs or upgrading existing
ones so they are accessible by disabled people are
carefully evaluated, and the necessary action is taken.
İşbank also develops digital solutions for its disabled
customers. The İşCep IOS application supports Voice
Over, while the Android application supports TalkBack
features. With the “Dynamic type” feature, text sizes in
İşCep can be adjusted according to personal preferences.
İşbank's corporate website is compatible with Jaws.
The "Enabled Banking" page has been added to our
corporate website isbank.com.tr to provide the necessary
directions for our disabled customers to easily carry
out their transactions. For hearing-impaired customers,
a translation plugin has been added to the "Enabled
Banking" and "Help" pages which translates content into
sign language via an avatar.
The bank keeps the date of birth, disability, and disability
status information of disabled customers in its system and
provides services that should be provided to customers
free of charge. Within this scope, customers can use
all Bankamatik ATMs installed in the country to inquire
about balance, withdraw money, deposit money, inquire
about credit card debt, and pay credit card debt without
any additional costs and fees. In addition, for disabled
customers, transactions such as signing contracts,
opening accounts, using loans, and applying for cards can
be carried out safely and easily.
Eye Brand Certification
BlindLook is a firm that, with its voice-focused technology,
allows any product or service to be freely accessible to
visually-impaired people, making mindful blind-friendly
brands a reality. The firm's Eye Brand certification is a
global certificate that documents inclusive services
offered by blind-friendly brands.
Within İşbank’s collaboration with Blindlook, blind users
tested the Bank's websites. The websites maximiles.
com.tr and maximumgenc.com.tr passed these tests and
received the "Eye Brand" badge. The certification process
for the Bank's corporate website isbank.com.tr and İşCep
is underway.
511
Number of
branches suitable
for use by visually
impaired customers
791
329
Number of branches
suitable for use
by orthopedically
impaired customers
Number of Bankamatik
ATMs suitable for use by
orthopedically impaired
customers
93%
Ratio of disabled-
friendly Bankamatik
ATMs
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İşbank 2022 Integrated Annual Report 77
Climate Action
Climate change is one of the most urgent
problems facing our planet.
As İşbank, we conduct comprehensive risk and opportunity analyses for climate change,
which affects the environment, social life, and economy and has various negative impacts
worldwide. To be a part of the solution, we establish partnerships for climate action.
Related Capital
Elements:
Material Topics:
ᲁResponsible Finance
and Investment
Integrating ESG
Criteria
ᲁCombating Climate
Change
Risks
Opportunities
Existing financial solutions proving to be ineffective
as a result of changes in the way of doing business
and risk matrix across many sectors due to global
warming
Compliance challenges encountered by customers
during the transition to a green economy
Infrastructure deficiencies of organizations for a
transition economy
Potential difficulties in complying with laws and
regulations governing the green economy
Potential deterioration in customer creditworthiness
due to climate-related risks
Contributed SDGs
Contribution to a green economy and
combating climate change through effective
ESG risk management
Possibility to reach new customers as a
reliable partner in the transition to a green
economy
Ability to access new global fund sources
that promote a transition economy
İşbank's comprehensive risk management
approach and its capacity to adapt early to
climate-related regulations
Key Performance Indicators
2019
2020
2021
2022
Field visits made as part of environmental and social risk
evaluation
Number of financed projects subjected to environmental
and social risk evaluation
Sum of financing provided for projects subjected to
environmental and social risk evaluation (million USD)
Amount of clean energy (million MWh) generated by
financed renewable energy projects
Total installed capacity of the renewable energy projects
financed by İşbank (MW)
Share of renewable energy projects in the total energy
projects portfolio (%)
Carbon Disclosure Program (CDP) Climate Change
Report
Carbon Disclosure Program (CDP) Water Safety Report
22
13
395
21.9
262
67.3
C
-
1
7
365
24.9
5
9
331
32.3
44
8
432
40.9
1,950
1,008
2,059✓
69.5
A-
-
71
B
C
75
A-
B
Targets
Targets for 2022
The Bank will continue working to increase the share of
renewable energy projects in the total energy generation
projects portfolio. In 2022, it is anticipated that 100% of the
loans to be allocated for new energy plant investments will be
used for renewable energy projects.
Realization in
2022
Realization
Targets for 2023
100%
✓⃝
The target is planned to be
preserved.
In 2022, the Bank will create its report as per the Task Force
on Climate-related Financial Disclosures (TCFD). İşbank
aims to improve reporting on climate change-linked risks and
opportunities in order to achieve a better approach to corporate
governance and risks.
The Bank is still
continuing its
activities on this
front.
In order to reach net-zero targets by 2050 within the scope of
the NZBA commitment, the Bank aims to support its customers'
transition processes to a net-zero economy by focusing its 2030
targets on carbon-intensive sectors, and to report and publish its
progress in emission targets on an annual basis.
The Bank is
continuing its
activities.
İşbank set targets for the amount of sustainable loans it will
provide to the national economy in 2022.
-
The Bank aims to increase the number of customers investing in
sustainable capital market instruments by 5%.
Number of
customers in
2022: 36,513.
The target is planned to be
preserved.
Within the scope of the
NZBA commitment, efforts to
decarbonize the loan portfolio
will continue.
İşbank aims to provide TL
300 billion in sustainable
loans by 2026.
By 2025, the number of
customers is targeted to
exceed 42 thousand.
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İşbank 2022 Integrated Annual Report 79
Climate Change
Risk Management
Risks arising from climate change are radically affecting
business practices and risk matrices across all sectors.
If financial institutions do not closely monitor these
changes and provide the necessary internal controls,
they may face significant commercial risks and fail to take
advantage of the opportunities created by the transition
economy.
İşbank takes into account all risks (including transition
risks and physical risks and the subcategories thereof)
arising from climate change. These risks are prioritized
based on a qualitative and quantitative assessment.
Climate-related risks and opportunities are addressed in
the Business Program, which includes the Bank's annual
targets, and in the Strategic Plan document, which is
prepared with a longer-term perspective, as part of
efforts to integrate sustainability goals and policies into
business conduct.
To be a guiding business partner in enabling
customers to develop adaptability to market
dynamics that will affect their activities, such as Green
Deal and carbon border adjustment,
Playing a leading role in the green transformation of
the national economy within the framework of Net-
Zero Banking Alliance membership,
Increasing the share of sustainability-themed loans
and resources in the balance sheet,
Reducing greenhouse gas emissions, energy
consumption, vehicle fuel consumption, and waste,
Diversifying and increasing the volume of
environmental financing products that reflect İşbank’s
responsible banking approach and similar factors
aiming to mitigate climate-related risks and seize
opportunities.
The Climate Change Risk Policy sets out the principles
and procedures to be followed for detecting, identifying,
assessing, measuring, monitoring, controlling, reporting
and managing the climate change risks the Bank may be
exposed to in connection with its activities. The Climate
Change Risk Policy is an integral part of the Bank's other
Risk Policies.
A large portion of the Bank's exposure to climate risk arises
from its customers in the commercial loan portfolio. For the
measurement of this risk, the commercial loan portfolio covering
all sectors is considered and analyzed. A two-stage approach is
followed to assess the exposure of the loan portfolio to climate
risks:
公 A sectoral climate change risk heat map
is used to identify the sectors that should
be prioritized when assessing climate
change risk. The 5-level risk scale is used
to determine to what extent each sector is
exposed to climate risks.
典 A scenario analysis enables an impact
analysis to be performed for risk events in
sectors with high and medium-high climate
risk levels identified by the heat map. The
adopted scenario analysis approach is
prepared in accordance with the climate
change methodology followed by the
United Nations Environment Program -
Finance Initiative (UNEP-FI) and the climate
scenarios created by TCFD.
The main purpose of climate change risk management
is to ensure that the Bank's activities and practices are
aligned with its climate change strategy. Responsibilities
for management of climate change risk have been
defined in the form of a triple defense line. The role of the
first line of defense is basically to ensure that the loan
decisions are made by considering the climate change
risks during the loan allocation process. The second
line of defense determines the working principles, rules,
policies and requirements in relation to the climate
change risk. The third line of defense, within its existing
roles and responsibilities, offers reassurance to the Board
of Directors that the structure described here functions
properly.
İşbank has added the indicator “Share of Sectors With
High Climate Change Risk Within Total Commercial
Portfolio” to the solo risk appetite framework to prevent
the concentration of sectors with a high exposure to
climate change risks within the portfolio and provide
guidance for composition of the portfolio in subsequent
periods. This indicator is monitored monthly and reported
quarterly.
The impact of a possible carbon tax or carbon trading
system implementation on İşbank is measured through
scenario analyses. With this method, the financial data
of loan customers operating in sectors that are exposed
to high transition risks and are expected to be most
affected by such regulations, especially in the energy
generation sector, are subjected to stress tests by taking
into account the additional liabilities mentioned, and the
possible effects of changes in the creditworthiness of
the customers on the Bank's balance sheet are analyzed.
Financing assessments are also carried out to contribute
to the reduction of carbon emissions of sectors such
as cement, iron-steel, aluminum, fertilizer, and energy,
which will be primarily affected by the EU Carbon Border
Adjustment.
Partnerships for Climate Action
İşbank has been reporting since 2019 within the scope
of the Carbon Disclosure Project (CDP) which allows
companies to report to investors how they manage
their activities aiming to reduce carbon emissions and
their risks related to climate change. The Bank raised its
rating to “(A-) Leadership” in 2022. In 2023 and beyond,
the Bank aims to maintain its leadership level rating by
continuing its efforts to manage climate change risks and
seize opportunities.
İşbank joined the Net-Zero Banking Alliance (NZBA) in
2022. The Net-Zero Banking Alliance brings together
122 banks from 41 countries under the umbrella of the
United Nations, representing approximately 40% of
global banking assets and committing to align their loan
and investment portfolios with net-zero emissions by
2050. With the NZBA commitment, İşbank aims to seize
the opportunities that will arise during the transition to a
green economy, support customers' ESG transformation,
manage risks associated with climate change, and to
position itself as a guiding business partner to improve
companies' adaptability to regulations that will affect
economic activity, such as the European Union Green
Deal/carbon border tax. This membership also imposes
a number of obligations on İşbank. In order to reach
net-zero targets by 2050, the Bank is committed to
supporting its customers' transition processes to a
net-zero economy by focusing its 2030 targets on
carbon-intensive sectors and to reporting and publishing
its progress in emission targets on an annual basis.
İşbank has also committed to confirming its emission
reduction targets under the Science Based Targets
(SBT).
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İşbank 2022 Integrated Annual Report 81
İşbank aims to align its operations with the UN
Sustainable Development Goals (SDGs) and the Paris
Climate Agreement targets through its signature of the
United Nations Environment Program Finance Initiative
(UNEP FI) Principles for Responsible Banking (PRB).
The ‘Principles for Responsible Banking’, which are
expected to make a significant contribution to the United
Nations Sustainable Development Goals and the Paris
Agreement targets, focus on six areas: Alignment, Impact,
Customers, Stakeholders, Governance and Goal Setting,
and Transparency and Accountability.
You can access İşbank's Impact Report within the
scope of UNEP Principles for Responsible Banking at
https://www.isbank.com.tr/bankamizi-taniyin/Documents/
yatirimci-iliskileri/raporlarimiz/prb/PRB2021.pdf.
İşbank also supports sector-based partnerships on
climate action. İmece Workshops are organized where
representatives from many different branches such as
universities, private sector, entrepreneurs, associations,
and public administrators come together with public
authorities to discuss issues on climate, misuse of
water, deforestation, and misapplication of agricultural
techniques, and these issues are evaluated together with
all parties. İmece Workshops contribute to the sector
with their carefully selected participants and workshop
outputs. Within this scope, two İmece Workshops were
organized in October and December of 2022, with
the theme of Water and Wheat, respectively. İşbank is
one of the project stakeholders of the Izmir Agricultural
Technology Center, which was launched under the
leadership of the Izmir Commodity Exchange to
contribute to the continuation of agriculture in harmony
with changing conditions and to develop new and
effective technologies. This center aims to become
an R&D base for agricultural technologies. Among the
center’s goals is to ensure the continuous development
of agricultural technologies and increase the interest of
young people in agriculture.
The European Fund for Southeast Europe S.A (EFSE)
is funding a joint project for Türkiye's agricultural sector
under a consultancy services agreement with Finance
in Motion Gmbh (FiM), a German financial institution.
Within the project, work is ongoing to measure the
carbon footprint of wheat, barley, sunflower, and corn
producers. Within the cooperation, the Bank contributed
to the financing of various trainings for bank employees
as well as producers in the agricultural ecosystem,
farmer meetings and events, which aim to contribute
to sustainable agriculture such as İmece Workshops,
organized on different topics. Within this scope, in 2022,
5 “Hero Product Trainings” and preparation of reports
on these products, in-bank technical training, 2 “İmece
Workshops”, 15 “Farmer Meetings” and agricultural
calendars for 3 products were realized.
“Green Transformation Meetings at SMEs” are organized
in Organized Industrial Zones with the aim to inform
SMEs about sustainability, to convey the opportunities
therein, and to raise awareness.
Management of Water Risks
Water-related risks to which İşbank is exposed are
assessed holistically within the framework of corporate
risk management. Water risks related to “physical
damage” in terms of the Bank's own operations are
evaluated under the “Physical Damage/Risk” category
of operational and climate change risk classifications.
These risks, such as damage to assets as a result of
heavy rains and floods, are assessed within the scope
of Top-Down Risk Assessment, which is an approach
used to assess and prioritize operational risks that may
arise during the conduct of operations. The Bank also
conducts an annual “Environmental Risk Assessment” for
its direct operations, including water, waste management,
compliance with legal obligations, employee health and
safety, and other water risks related to suppliers.
Key stakeholders in the İşbank ecosystem include
employees, customers, investors, regulatory authorities,
suppliers, and the local communities in which we
operate. These stakeholders are taken into account in
water-related risk assessments.
One of the main risks that could significantly affect the
Bank's operations is damage to the Bank's assets and/
or customer assets (e.g. assets in safe deposit boxes)
located in the Bank's premises due to the increased
frequency of extreme weather events such as floods due
to climate change. In addition, İşbank is also exposed to
a number of water-related risks through its customers.
One of the most important of these risks is the loss of
value of real estate in the Bank's collateral portfolio due
to events that may occur in the short and long term, such
as severe floods and sea water rise.
İşbank also evaluates the potential environmental
and social (E&S) impacts of the investment projects it
finances. All projects are evaluated within the scope of
national laws and regulations. In all projects financed
by İşbank, customers must comply with the relevant
regulations. At İşbank, all potential ESG risks of all new
investments are evaluated according to the ÇESMOD
system. Water-related risks examined through this
model are under three main headings: water source,
wastewater, and resource consumption.
In order to reduce the effects of water-related risks,
İşbank expects project companies to measure water
quality at the intervals set out in applicable regulations
and to report on the use of water and resource efficiency.
Management of Forest Risks
Companies that use forest products as raw materials
in their processes must comply with the provisions of
national forest laws. In all projects financed by İşbank,
customers are required to comply with national laws and
regulations on forestry. İşbank evaluates the potential ESG
risks of projects according to the ÇESMOD methodology.
With the ÇESMOD methodology, critical habitat and
sensitive areas evaluation and balancing strategy studies
are taken into consideration in order to conduct an
assessment of forest-related risks. Based on these factors,
İşbank considers the project's environmental impact in
terms of deforestation and use of forests. For example,
large-scale highway projects are classified as high-risk (A)
projects as they use a significant amount of land. İşbank
requires project companies to take certain measures, such
as re-locating trees around the project area to appropriate
areas and/or planting trees in place of any trees cut down,
in order to eliminate negative effects of the investment in
sensitive areas.
Tree planting commitments are taken from projects,
particularly linear projects and thermal power plants.
These commitments are included in contracts and
monitored annually.
Management of Biodiversity Risks
While risk categories are identified as part of the
Environmental and Social Impact Evaluations done by
İşbank, biological risks are evaluated on a per-project
basis. A Biodiversity Action Plan (BAP) is requested for
projects with Risk A category and high biodiversity risks.
In the ÇESMOD question set, the need for a critical
habitat assessment and balancing strategy study
for all relevant projects is examined. In addition, on a
sectoral basis, additional impact questions such as bat
habitat, bird migration routes and biodiversity issues are
considered.
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Environmental and Social
Risk Management in Loans
Factors such as those listed above, the scope of which
is set out in the applicable laws and regulations, are
evaluated and scored using questions specifically
developed based on the activities of the company being
evaluated. Based on the answers given, the risk level of
the project is determined, e.g. high (A), medium high (B+),
medium low (B-) and low (C). A "Project Environmental
and Social Evaluation Document" is prepared based on
national and international legislation and good practices
(e.g. IFC Performance Standards, EBRD Performance
Requirements, Equator Principles), and the document
is then added to the loan folder which is submitted for
approval.
For all projects deemed eligible based on the evaluations
conducted by the Sustainable Finance (SF) team,
including but not limited to those projects which are
classified by İşbank as high-risk (risk category A), an
independent environmental consultant is assigned to act
on behalf of the Bank. The independent environmental
consultant conducts field visits and literature research
to determine the current status of the project and its
possible environmental and social impact. As a result
of this work, an Environmental and Social Status
Evaluation (ESSE), which describes the current status
and applicability of any permission / approval process
regarding environmental obligations as well as the
consultant's comments, and an Environmental and
Social Action Plan (ESAP), which describes how to limit
and eliminate this impact and manage the process,
are drawn up and submitted to the Bank. When
deemed necessary, the consultant is requested to
carry out periodic monitoring studies on these ESAP
items throughout the loan term. In projects where an
At İşbank, new investment projects with an
investment value over USD 10 million are subjected
to the Environmental and Social Risk Evaluation Tool
(ÇESMOD).
The ERET model, which İşbank had used since 2013
to calculate the Environmental and Social Risk Score
of investments, was replaced in 2021 by ÇESMOD
(Environmental and Social Model), an Environmental and
Social Risk Evaluation Model that is more closely aligned
with the global standards of risk measurement and can
be tailored according to the type of investment. In 2022,
the transition process from ERET was completed, and
the new model was put into use.
With the ÇESMOD Model, E&S risk scores for
investments financed by the Bank are calculated
with initial evaluations conducted with specific sets
of questions based on the type of investment, e.g.
new facility development, capacity expansion and/or
additional facilities or refinancing/procurement, followed
by evaluations conducted with specific sets of questions
based on the sector in question
Sets of questions based on type of investment
and sector:
䬏 EIA decisions, environmental permits, environmental
and/or social impact evaluation,
䬏 Nature preserve, critical habitat and ecosystem
evaluations,
䬏 Earthquake risk,
䬏 Natural resource use,
䬏 Waste management,
䬏 Air, soil and water quality,
䬏 Noise and dust,
䬏 Occupational health and safety, public health and
safety,
䬏 Management of chemicals,
䬏 Involuntary displacement and stakeholder engagement
independent environmental consultant is not appointed,
ESSE, ESAP and monitoring activities are carried out by
İşbank SF service specialists if necessary.
In the newly created ÇESMOD model, sector-based
questions are asked about both groundwater and
surface water resources, and risk scores are determined
accordingly. Where necessary, forest and water-related
permits are requested from companies on a project
basis. Within the scope of the EIA regulation, IFC
Performance Standards, Equator Principles and EBRD
Performance Criteria, İşbank also assesses how the
project affects biodiversity and nature preserves.
In 2022, 166 investments were subjected to
Environmental and Social Risk Evaluation. A total of 106
projects were financed between 2013 and 2022.
Number of Field Visits Made as Part
of Environmental and Social Risk
Management
Number of projects undergoing
Environmental and Social Risk
Evaluation
Number of projects financed after
undergoing environmental and social
risk evaluation
Number of projects financed by risk
category
44✓
12✓
8✓
1 ‘A’, ✓
5 ‘B+’✓
3 ‘B-‘ ✓
3 ‘C’ ✓
Sustainability Analysis System
(SÜRAS)
Since 2012, İşbank has been assessing environmental
and social risks in projects with a total investment amount
above a certain limit in order to manage the impact
it creates through its loan portfolio. Regardless of the
amount of financing, the Environmental and Social Risk
Evaluation Tool (ÇESMOD) is being used to determine the
environmental and social risk categories of projects with a
total investment value of more than USD 10 million, and a
roadmap is being created to eliminate or limit the possible
negative impacts of the investment as much as possible
according to the assigned risk category.
However, as climate change and its increasing risks
are becoming more evident, there is a need to improve
existing ways of doing business and review them in line
with international best practices. In this context, in addition
to the investment types evaluated within the scope of
the ÇESMOD, a process for assessing environmental
and social risks across the commercial loan portfolio
was designed and put into operation in 2022. The
new process, called the Sustainability Analysis System
(SÜRAS), includes;
ᆔ“Environmental and Social Question Set”, which
enables companies to determine the environmental
and social risks and
ᆔ “Climate Change Question Set”, which enables the
companies to determine awareness and resilience
levels on climate change risks.
Activities Not Financed
İşbank rejects any loan applications for activities on
the İşbank Exclusion List, which the Bank names in
the annex to its Environmental and Social Impacts
Policy, without even taking them into consideration.
Among activities not financed by the Bank are
investments involving forced labor and child
employment, the production of weapons of mass
destruction and landmines, and the production and
trading of internationally prohibited chemicals, drugs or
substances that are harmful to the ozone layer.
Loans for financing greenfield investments of coal- and
natural gas-fired thermal power plants to be established
for electricity generation and new coal mine investments
are included in the İşbank Exclusion List. In 2022,
gold mining using cyanide, and activities prohibited
by national legislation and international conventions
regarding the protection of biodiversity resources and
cultural heritage were also added to the activities not
financed.
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Products and Services
Contributing to a Green Economy
Climate change brings many opportunities as well
as risks. With the financing allocated to support the
transition economy, it is possible to develop creative
products and processes to combat climate change. In
order to be a good companion for its customers in a
green economy, İşbank develops numerous products
and services that support a green economy.
İşbank Group is in the energy business
In 2022, İşbank Group established İş Enerji
Yatırımları A.Ş. to create an integrated energy
portfolio, primarily in electricity generation and
trade. İşbank Group aims to further expand its
fields of activity by incorporating the energy
sector, particularly electricity generation.
İş Enerji aims to participate in facilities and
companies engaged in the generation and
trade of electrical energy, primarily based on
renewable energy sources such as hydraulic,
wind, and solar energy.
Having made a significant contribution to
Türkiye’s annual electricity generation with
the loan support provided to the electric
energy sector to date, İşbank Group has also
assumed the role of investor in the sector with its
shareholdings in renewable energy power plants
with an installed capacity of over 800 MW.
Financing Renewable Energy
The transition to renewable energy sources is among
the most important steps of climate action. Renewable
energy investments also provide significant economic
benefits through the new business lines created. It
is essential that renewable energy investments and
technologies are supported to ensure an increase of
renewable sources in energy generation. İşbank is one of
the pioneering institutions in financing renewable energy
projects in our country. All new project financing provided
by the Bank for electricity generation investments after
2015 has been allocated to renewable energy projects.
The number of renewable energy projects financed
during the year is 162, and the loan amount provided to
these projects is USD 544 million.
All new project financing provided by İşbank for the
energy generation sector in 2022 consists of renewable
energy projects. In line with its commitment to allocate
100% of its new investment loans for the energy
generation sector to renewable energy investments,
the Bank aims to increase the ratio of renewable energy
loans to total electricity generation loans even more from
its level of 75%.
Cooperation with International Financial
Institutions for a Green and Sustainable
Economy
Since 2008, İşbank has been obtaining medium-long-
term, special-purpose financing from international
financial institutions such as the European Investment
Bank (EIB), European Bank for Reconstruction and
Development (EBRD), Proparco, U.S. International
Development Finance Corporation (DFC (formerly known
as OPIC)), the International Finance Corporation (IFC),
and the Asian Infrastructure Investment Bank (AIIB) in
order to finance the sectors and activities that contribute
to sustainability. Besides energy efficiency and renewable
energy projects, these resources are also used to finance
female entrepreneurs, SMEs, agricultural enterprises and
businesses located in priority development regions.
The Bank also supports the economy by increasing
awareness and efficiency in the use of resources through
technical consultancy and training received from financial
institutions.
Closely following developments in the field of sustainable
finance, İşbank evaluates the new financing needs of its
customers and continues to provide resources for projects
that are feasible and comply with lending principles and
environmental and social standards. The total amount
of loan agreements signed with international financial
institutions within the sustainable framework during the
year is USD 327 million.
You can find the list of funds obtained by İşbank
from international financial institutions and that were
outstanding as of 2022 in the Table of Outstanding
Loans from International Financial Institutions.
The sustainability-linked syndication loans
İşbank secured two sustainability-linked syndication
loans amounting to EUR 483 million and USD 257
million in June 2022 and EUR 330.5 million and USD 191
million in November 2022.
New resources for green transformation
and a sustainable economy
Within the scope of the securitization program based
on foreign remittance flows (“Diversified Payment
Rights”), the Bank obtained a total of USD 227 million
in funding from the European Bank for Reconstruction
and Development (EBRD) and the International Finance
Corporation (IFC) in August 2022, with a final maturity of
5 years.
The USD 127 million in funding provided by the EBRD
will be used to finance women-led businesses as well as
renewable energy and resource efficiency investments.
The USD 100 million in funding provided by the IFC,
on the other hand, will be used to finance mortgages,
including green mortgages.
In September 2022, İşbank signed a USD 100 million
loan agreement with the Asian Infrastructure Investment
Bank (AIIB) and realized its first transaction with the
relevant institution. This 5-year term loan will be used to
finance SMEs and small-scale corporate firms affected
by the COVID-19 pandemic.
Karapınar YEKA SPP project
Within the scope of the Karapınar YEKA SPP
project, which is planned to be established in
the Karapınar district of Konya province with an
installed capacity of 1,000 MWe, financing was
provided by our Bank and the environmental
and social risks of the project were evaluated.
The risk score was B+.
The Environmental and Social Risk Governance
System “ESRG” was developed to audit project
activities. The ESRG consists of Kalyon Enerji’s
policies, project assessment documentation,
project-specific management plans, supporting
thematic sub-plans, and reporting templates to
monitor progress. The ESRG will be supported
by management plans to be prepared.
The ESRG framework is compatible with
ISO14001:2015 Environmental management
and OHSAS 18001:2007 Occupational Health
and Safety management requirements.
In addition, within the framework of the risk
category, on behalf of the lenders, a private
firm has been assigned to provide services
on behalf of the Banks to carry out an
environmental and social impact evaluation
study within the scope of the Karapınar SPP
Project, as per local legislation and regulations,
Equator Principles, IFC Performance Standards,
EBRD Performance Criteria, and international
best practices, and an Environmental and Social
Status Evaluation (ESSE) for permits, licenses,
and legal requirements for the Project and an
Environmental and Social Action Plan (ESAP) for
managing the identified impacts were prepared.
Within this framework, the monitoring of the
actions to be taken to limit the environmental
and social impacts of the Project will be carried
out by the audit firm through site visits every
six months during the construction period and
annually during the operation period, and these
reports will be disclosed to the lenders within
the same periods; the loan agreement will be
conditioned on the outputs of these reports
being in line with the company's commitments
and, where necessary, the implementation of
appropriate actions.
It was determined that the activities carried out
serve Sustainable Development Goals 7.1, 7.2,
8.4, 8.5, 8.7, 12.5, 13.3, 17.3, and 17.7.
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Green Enterprise Loan
Green Vehicle Loan
İmeceMobil
Launched in 2022, the Green Enterprise Loan was
created to support companies that obtain sustainability
certificates by making investments to minimize their
environmental impact at every stage of the life cycle from
raw materials to the final product.
Pressurized Irrigation Systems Loan
The Pressurized Irrigation Systems Loan provides
financing for the transformation investments of
customers using wild or pressurized irrigation. The
pressurized irrigation systems loan is estimated to
provide TL 31 million in economic benefits and a 35%
increase in efficiency.
TEMA Environmental Variable Fund
The fund targets investors who want to utilize their TL
savings in the long term, are environmentally conscious,
protect nature, and aim to leave a livable world for future
generations. In 2022, the total value of the fund was TL
31.5 million and the number of investors was 2,981. The
annual return is 31.28%.
Green Loan and Green Mortgage
This Green Loan product is aimed to finance various
environmentally friendly activities, such as post-
insulation (thermal and/or water insulation) of existing
buildings, supply of natural gas conversion, installation
of energy-efficient heating and/or cooling systems or
replacement of old inefficient ones with more energy-
efficient systems, replacement of durable goods with
more energy-efficient ones, and purchase of solar
energy panels. The Green Mortgage provides financing
for the purchase of real estate properties with energy
classes of “A” and “B”. In order to encourage green
products, the allocation fee charged for both Green Loan
products is 2.5 per thousand of the loan amount, while
for standard consumer loans and mortgages it is 5 per
thousand.
Green Vehicle Loan campaigns are organized for electric
and hybrid model vehicles. Individuals and commercial
customers can benefit from these campaigns, and
improvements are made in favor of our customers
in interest rate/fee-commission items according to
market conditions. No loan allocation fee is charged for
personal vehicle loans extended within the scope of the
campaign. The total amount of loans extended in 2022
for electric and hybrid vehicles amounted to TL 1,232
million.
Solar Loan by İşbank
The loan aims to finance rooftop, facade, and land-type
unlicensed SPP investments for self-consumption
purposes. In 2022, nearly TL 596 million in Solar Loans
were lent by İşbank.
Energy Efficiency Loan
The loan aims to finance “resource efficiency”
investments that cover energy efficiency as well as
water efficiency, raw material efficiency, and waste
management.
Green Office Premises Loan
Green Office Premises Loans can be extended to legal
entity merchant customers for all kinds of real estate
purchases except land, and to real person merchants and
self-employed individuals for the purchase of workplaces
to be used in their commercial activities from “Green
Buildings” with A and B Energy Identity Certificates, Gold
and above category LEED, and Very Good and above
category BREEAM certificates. In 2022, the amount of
loans extended amounted to TL 54.3 million.
Electric Vehicle Charging Station
Installation Loan
Financing is provided for the establishment of Electric
Vehicle Charging Stations in order to contribute to the
development of the electric vehicle sector and help EV
owners easily access charging units.
The ImeceMobil application, developed by Softtech
Ventures, a subsidiary of İşbank, provides special
services for farmers, enabling them to do the correct
amount of irrigation and use fertilizer at the right time,
thus contributing to the proper use of resources.
Marine Conservation Loan
Launched in the last quarter of 2021, the Marine
Conservation Loan aims to meet the financing needs
of businesses that want to contribute to the protection
of the seas by investing in wastewater treatment,
wastewater recovery facilities, ship ballast water
treatment or gray water treatment systems, or that
want to improve their existing facilities by investing
in maintenance, repair, and capacity increases. The
wastewater treatment and ship ballast water treatment
systems within the loan contribute to biodiversity
by enabling the existence of clean water and food
in the environment in which they live and protecting
the existence of life forms so that they can survive. In
2022, the Marine Conservation Loan amounted to
approximately TL 49.6 million.
“Green” and “Sustainable” Investment
Instruments
Within the scope of the “Green Debt Instrument,
Sustainable Debt Instrument, Green Lease Certificate,
Sustainable Lease Certificate Guidelines” published
by the Capital Markets Board (CMB) in February 2022,
İşbank obtained the necessary permission in June to
issue green and/or sustainable bonds or commercial
papers up to USD 1.5 billion abroad.
Geleceğe Orman (Forest for the Future)
As part of İşbank's goal of a sustainable future, İşbank
launched the Geleceğe Orman (Forest for the Future)
application on İşCep last year in cooperation with the
TEMA Foundation. The carbon points users collect
through green banking transactions and activities in their
daily lives are converted into sapling donations through
the TEMA Foundation. By the end of 2022, the number
of participants in Geleceğe Orman exceeded 200
thousand, while 80 thousand saplings were donated
through the application to date. The Bank aims to plant a
total of 1 million saplings in the first three years.
In 2022, the Geleceğe Orman application received the
first prize at the Gartner Eye on Innovation for Financial
Services Awards.
“Water” themed İmece Workshop
In our country, where 74% of freshwater resources are
used for agricultural irrigation, joint solution suggestions
for protecting both nature and producers were discussed
at the Imece Workshop, including how to manage water
with new technologies in the fight against drought, how
to prevent water waste for sustainable agriculture, and
how to use freshwater resources more efficiently in
agriculture.
The Water Workshop, held in Izmir under the slogan
“Akışına Bırakma” (Don't Let It Flow), brought together
representatives from relevant public and non-
governmental organizations, agricultural cooperatives
and associations, producers, academics, agricultural
entrepreneurs, and leading farmers. The report of the
water workshop is available at
https://www.isbank.com.tr/is-ticari/su-calistayi.
“Wheat” themed İmece Workshop
More than 70 stakeholders including representatives
from relevant public and non-governmental
organizations, agricultural cooperatives and associations,
producers, academics, agricultural entrepreneurs,
and farmers came together at the Wheat Workshop
held in Ankara on December 15, 2022 under the
slogan “Buğday ek, hayat biç” (Sow wheat, reap life).
Solutions on how to produce wheat, which is of strategic
importance as the world's main food source, in the
most efficient way for sustainable agriculture and its
contribution to the economy were discussed.
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Next-Generation
Banking
In recent years, the most radical change in the way of doing business in the banking and finance
sector has been the increasing digitalization in all areas. With digitalization, the development
of products and services by fintechs in parallel with traditional banking is another important
development in the field of next-generation banking.
İşbank aims to continuously improve itself by meeting the requirements of next-generation banking
with its strong and competent digital banking infrastructure. For 98 years, it has been providing
customers with a flawless and secure experience at all
contact points by using technology in its most efficient and up-to-date form.
Related Capital
Elements
Relevant Stakeholders
ᲁCustomers
ᲁRegulatory
Authorities
ᲁIndustry
Stakeholders
Material Topics
ᲁDigital Banking
ᲁCybersecurity and
Customer Privacy
Risks
Opportunities
Cybersecurity risks increased with digitalization
Management of reduced need for labor as a result
of digitalization
Failure to keep up with rapid economic and
technological changes due to large corporate
structure
Losing touch with developments such as platform
business models and sharing economy, which are
essential components of the new economy
Providing personalized products to customers with
digital products and services and 24/7 accessibility
Opportunity to establish more effective
communication with customers thanks to
digitalization of procedures
Becoming a preferred institution in the eyes of
stakeholders with data security investments
Becoming an important actor of the new economy
with the support provided to entrepreneurs
Strengthening business strategies with
partnerships in the field of fintech
Fast decision making and implementation with
agile business models
2019
6.506
2020
6.521
2021
6.476
Key Performance Indicators
Number of Bankamatik ATMs
Number of digital banking customers (million)
Number of mobile banking customers (million)
Maximum Mobile users (million)
Share of digital channels in non-cash financial transactions (%)
Share of digital channels in sales (%)
Number of cardless transactions made from Bankamatik ATMs
(million)
Amount of cardless transactions performed through Bankamatik
ATMs (billion TL)
Paper consumption savings achieved by digitalization (million
pages)
Increase in the number of digital banking customers compared
to the previous year (%)
Share of non-branch channels (%)
Number of users reached by Maxi (million)
Number of questions answered by Maxi (million)
8,1
7,8
1,7
84,6
40,1
33,8
24,8
40,4
12,5
92,2
4,8
18,9
Volume of end-to-end digital commercial loan disbursement
through Instant Commercial Loan (million TL)
143,98
9,2
9,0
1,9
92,1
57,5
35,3
32,4
71,2
13,6
95,7
5,7
33,3
506
10,2
10,0
2,1
94,6
62,7
39,3
40,6
64
11,0
95,6
6,7
49,1
1.191
Successful Transactions Index for IT Critical Services
99,96
99,95
99,96
Number of technological entrepreneurs who were supported to
enter the banking system
Number of campaigns aimed at promoting the products of
technological entrepreneurs
Fines incurred due to data security breaches (TL)
117
7
0
80
4
97
16
350.000
150.000
2022
6.169✓
13,0
11,9✓
2,8
96,0
64,8
53,0
67,7
190
27,9
96,2
8,8
68,2
2.038
99,97
265
52
0
Contributed SDGs
Targets
Targets for 2022
Realization in 2022
Realization
Targets for 2023
It is aimed to increase the share of digital
channels in total sales to above 66% and
to above 70% by 2023.
As of the end of 2022, it is 65.2%.
The Bank aims to increase the number of
customers using digital banking channels
to 11.5 million by 2023.
Also, with the impact of our Nays application,
we reached 13 million individual digital
channel customers by the end of 2022.
The number of technological
entrepreneurs who will enter the banking
system by 2023 is aimed to be over 100
every year.
In 2022, the Technological Entrepreneur
Package was defined for the first time,
providing privileges in our core banking
services and facilitating entry into the
financial system for a total of 265 startups.
✓⃝
✓⃝
✓⃝
It is aimed to be 70% in 2023.
The Bank aims to increase this
number to 14.5 million by 2023.
The number of technological
entrepreneurs who will enter the
banking system is aimed to be
over 100 every year.
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Digital Banking
While carrying out digital banking activities, İşbank aims
to engage in contextual interaction with customers, offer
personalized and innovative services, and provide an
end-to-end seamless experience.
The number of İşbank's digital banking users increased
by 27.5% compared to 2021 and reached 13 million.
The share of non-branch channels increased to 96.16%,
while the share of digital channels in sales rose to
65%. In addition, the Nays application, which debuted
on app stores on June 21, 2022, reached 2 million
downloads and 1.4 million registered users, 68% of
whom established a new relationship with İşbank, and 55
thousand users became İşbank customers by the end of
2022.
İşbank’s digital banking focus areas are;
䬏 Creating a flawless, secure, and personalized
customer experience for users at all contact points
through digital technologies and analytical methods
designed with an innovative approach,
䬏 Providing customers with a seamless end-to-end
experience by developing joint services with non-
Bank stakeholders within its vision to offer banking
service anywhere,
䬏 Collaborating with startups that will benefit the Bank,
Group companies and customers, and implementing
innovative business models, including impact
entrepreneurship with an open innovation approach,
䬏 Developing solutions and value propositions that
will assist users and organizations in making healthy
financial decisions,
䬏 Becoming an integrated business partner and
gateway to the digital world for all individual
customers in personal banking and for companies in
commercial banking,
䬏 Achieving a broad-based customer portfolio with
the inclusion of both unbanked customers and
commercial establishments with limited access to
financial services,
䬏 Contributing to nature and the future by adopting
new practices serving sustainability across digital
channels.
Accordingly, the new features that were prominent
in İşCep in 2022 were as follows:
䬏 Renewal of the money transfer and mutual fund
screens to maximize the experience,
䬏 Regarding credit cards; mobile contactless payment,
card campaigns, credit card pending transaction
installments along with additional installments,
additional card application,
䬏 Ability to record vehicle information and perform
vehicle-related operations quickly,
䬏 Ability to set a foreign exchange and gold alarm and
send instant notifications when the specified buying/
selling rate is reached,
䬏 Pensioner promotion renewal,
䬏 Suggesting a available limit,
䬏 Transferring money to cryptocurrency organizations,
䬏 Super POS application, additional commercial
account with installments, and virtual card for our
commercial customers,
䬏 Within the scope of the ongoing developments for
Geleceğe Orman (Forest for the Future), leader race,
participation points, carbon point history and point
earning display in task detail, and suggestions to
reduce carbon footprint functions were added.
In 2022, 20% of our Bank's new retail customers were
acquired end-to-end digitally through our “becoming
a customer remotely” service via our İşCep application.
Together with those who started the process on İşCep
and completed it at the branch, this ratio rises to 29%.
İşCep and Maximum Mobile, which continue to offer
privileged transactions to customers with new features
every day, include privileges and card transactions
specific to İşbank cards. Even if customers do not have
their credit cards with them, they can pay quickly and
securely with QR codes when shopping in stores or on
e-commerce sites with İşCep and Maximum Mobile.
Serving in 2022 with a renewed design, Pazarama is
an inclusive ecosystem where buyers and sellers in
e-commerce communicate with each other seamlessly
and easily. While purchasing products and services,
Pazarama, which enables access to payment and
financing opportunities that facilitate these transactions
without the need for another application, is included
within Maximum Mobile.
In 2022, efforts were made to improve the customer
experience on Maximum Mobile, and at the same
time, “cashback campaigns”, which were offered to our
customers in 2022 and have given a certain percentage
discount on spending, were launched.
While 2 million customers logged in to Maximum Mobile
in 2021, 2.6 million customers logged in in 2022 with an
increase of 33%. While 68 thousand customers logged
in to Maximum İşyerim in 2021, 89 thousand customers
logged in in 2022 with an increase of 31%. The number
of downloads for the Maximum İşyerim application
increased from 230,131 in 2021 to 339,972 at year-end
2022. The number of users utilizing the services of the
Maximum İşyerim application during the year reached
96.3 thousand.
In digital banking, İşbank's personal banking assistant
Maxi, which works with natural language processing
(NLP) technologies, offers a one-to-one dialog
experience to serve users 24/7 with proactive solutions
in times of need and allows customers to make their
transactions by talking or texting.
In 2022, with the Maxi IVR integration work completed
as part of the improvement of the customer experience,
Maxi started to greet all users contacting the Call Center,
informing them quickly and directing them to the relevant
menus.
Maxi realized 68.2 million dialogs in 2022, with the
number of dialogs increasing by 33.4% compared to
2021.
As part of the artificial intelligence integrations, Maxi,
the personal banking assistant, instantly addresses
refund claims of customers whose money is stuck
in a Bankamatik ATM and has also begun to perform
appropriate transactions for customers who would like to
report lost or stolen cards.
In 2022, temporary password and mobile phone update
requests of our customers started to be made via video
calls. Within this scope, approximately 1 million temporary
password calls and 60 thousand cell phone update calls
were received with customer identity verified via video.
In 2022, the diversity of transactions available in İşCep
was increased with enriched sales and application
capabilities in line with customers' expectations. The total
number of transactions that can be made on İşCep has
been increased to 616. In order to provide our customers
with a smooth end-to-end experience with the
products and services we offer through digital channels,
continuous improvements are made, and digital channel
competencies are continuously enhanced by utilizing the
opportunities provided by technology.
NAYS
Customer journeys have evolved with advancing
technology, and consumers’ expectations from
financial applications have accordingly evolved
into contextualized and personalized experiences.
As many technology companies and technology-
based platforms have become able to offer
financial services, it has become essential to
design new experience journeys.
the NAYS, which was launched 2022, application
targets customers who are highly technology
savvy, open to innovation, and want to receive
lean services. The application, in which the
most needed financial services in daily life are
offered with an easy, innovative, and entertaining
experience, was designed with insights from
potential users. Aiming to reach individuals,
especially the young segment between the ages
of 18-25 who are looking for an easier experience
other than sophisticated banking products and
who live intertwined with digital applications, NAYS
is expected to reach a wider audience in the future
by adding savings and investment products to
its free money sending and receiving service,
advantageous shopping opportunities, flexible
borrowing opportunities, and gamified earning
mechanisms.
The Nays application, which debuted on app
stores on June 21, 2022, reached 2 million
downloads and 1.4 million registered users, 68% of
whom established a new relationship with İşbank,
and 55 thousand users became İşbank customers
by the end of 2022.
İşbank is awarded the best digital
bank in Central and Eastern Europe
İşbank was awarded Central and Eastern
Europe's (CEE) Best Digital Bank at the Awards
for Excellence organized by Euromoney, one of
the most prestigious global finance and banking
publications.
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Open Banking
The Bank began API development activities according
to the standards published in preparation for compliance
with the open banking legislation. In this context, , the
Bank aims to make İşCep and the Internet Branch the
primary channel through which customers will prefer to
consolidate their financial transactions.
İşbank aims to expand the variety of APIs and the
number of integrations to include strategic products in
order to deliver the most suitable products at 3rd party
contact points with smooth experiences to its customers
when they need them. With the possibility to integrate
digital customer acquisition with 3rd parties, the number
of new digital customers and digital product sales will
increase. Solutions will be provided for the financial
needs of small players who do not yet have sufficient
technical knowledge and resources for API integration,
with products that use the İşbank API infrastructure
and can be easily integrated. Within this framework,
highlighting API services that will be offered outside
İşbank channels will contribute positively to the future of
the Bank.
Therefore, within the scope of API developments and
integration efforts made, the Bank maintained its position
as the bank with the highest number of integrations
among competing banks, and continued to be among
the leading banks in terms of API diversity.
In line with open banking, which has been adopted with
the vision of “banking anywhere”, a total of 62 APIs were
developed, and 96 different integrations were realized
through the APIs developed. The volume of financial
transactions through APIs exceeded TL 180 billion.
Within the scope of the CBRT open banking regulations,
which became mandatory on February 28, 2023,
account information and payment initiation services
were made available to authorized third-party institutions
in the form of APIs, and work was completed to display
other bank accounts included in the system on our
İşCep and Internet Branch channels in a consolidated
manner and to initiate payment transactions from these
accounts.
Within the scope of BRSA service banking regulations,
personal and commercial lending scenarios will be
implemented following BRSA approval. As the BRSA’s
circular on establishing a remote contractual relationship
and transaction authorization is expected to be finalized,
the approval process is on hold by the BRSA. After
approval, the Bank will be one of the first banks to provide
service model banking.
Paperless Banking
With the digital approval of product contracts
and application forms, the opening of non-Bank
Registered Electronic Mail (KEP) delivery to
the entire Bank, and the introduction of digital
signatures on receipts, 190 million✓ pages of
paper were saved in 2022 with an increase of
175% with respect to 2021, and TL 22 million
was saved in paper cost with an increase of
192% compared to last year.
With the digitalization of various contracts,
1.56 million contracts, equivalent to 21.6 million
pages, were saved annually. It was determined
that this operation saved TL 6.6 million in a
6-month period.
190 million✓
pages of paper savings and
TL 22 million
paper cost savings
327,199
downloads for Maximum İşyerim app
2.8 million
number of Maximum Mobile users
Developments in Payment Systems
With the perspective of “banking anywhere”, efforts to
address the daily needs of our customers are deployed
digitally and/or physically through business partnerships
in different sectors.
Accordingly, the projects and applications deployed in
the field of card applications are as follows:
In order to ensure that real person merchant
customers can complete their commercial credit card
applications with an end-to-end digital experience,
customers can view and approve the Commercial
Credit Card Membership Agreement on İşCep for
commercial credit card applications made by logging
in to İşCep, and the application can be completed
upon approval of the agreement. In addition to making
the lives of İşbank customers easier, this project also
contributes to the Bank’s paperless banking and
sustainability goals.
POAŞ Dealer cards have begun to be produced
digitally.
With the Maximum Business+ product, İşbank
contributed to the reduction of the operations with
customers and branches regarding the payments
to be made to the vendor by obtaining a certificate
of expenditure when it is necessary to check the
purpose of the lending in loans extended for the cash
needs of customers.
The İmece Card Application and Allocation Flow
via İşCep was launched, and within the framework
of the flow, it became possible to allocate İmece
Cards up to a limit of TL 50 thousand to real person
farmers who are İşbank customers by using the
Instant Commercial Loan decision engine, and to
simultaneously produce and deliver them to the
branches of their choice.
The ability to use Miles while shopping at certain
stores has been provided.
Credit card ready limit allocation was launched on
İşCep.
We deployed the following projects and applications
in the field of contracted merchants:
In 2022, by being integrated with transportation
infrastructure providers in various cities of Türkiye, it
became possible to use contactless credit and debit
cards as transportation cards by scanning them
through the Bank’s contracted merchant system.
Acceptance of UnionPay QR Method on İşbank
Physical POS Terminals: As part of the agreement
between İşbank and UnionPay International since
2020, the Maximum İşyerim app can accept QR
payments via UnionPay's mobile app. Thanks to the
developments in the payment acceptance methods
introduced in 2022, Ingenico POS devices can accept
payments in Euro, USD, and TL via the UnionPay QR
code method.
“POS’um Cepte” App: In addition to the speed and
convenience it provides, contactless payment is
also preferred in terms of hygiene. Therefore, with
the Maximum İşyerim app, it is now possible to turn
an NFC-enabled Android mobile phone into a POS
terminal for accepting contactless payments. In 2022,
the Pos’um Cepte App was provided with multi-
terminal and employee payment functions; thus, the
mobility of the application was increased by enabling
company employees to receive payments without the
requirement of being a Bank customer.
Moka Super POS (Virtual) Campaign: The Moka
Super POS (Virtual) Campaign, which enables small
and medium-sized companies to make installments
to different bank cards with a single virtual POS,
started to be offered to our customers through the
İşCep and Commercial Internet Branch.
Payment Collection with TR QR Code: it will be
possible to create QR Codes in the "TR QR Code"
format on POS terminals and Maximum İşyerim
applications wittin the efforts made, and all domestic
customers of the Bank will be able to shop by using
QR codes at İşbank POS terminals.
New Functions in Payment Collection via AliPay
Wallet and WeChatPay Method: Thanks to the
collaboration between İşbank and Alipay, payments
in USD and Euro via Alipay wallet can be accepted
on the Bank's physical POS terminals and Maximum
İşyerim application. In 2022, the WeChatPay payment
method, which used to be accepted only on Ingenico
model physical POS terminals, is accepted on
all Ingenico brand physical POS terminals and in
cash registry protocols, except for ÖKC and GMP3
protocols, and the Euro has been added as a payment
currency.
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Digital Loan Developments
Digitalization in Business Processes
İşbank aims to increase employee productivity by
digitalizing its repetitive, low value-added processes
that have a high risk of error. In 2022, many processes
were digitalized, saving time and reducing environmental
impact.
In 2022;
With the Customer Embedding project, an Artificial
Intelligence model that creates digital twins of our
customers was developed. By using the outputs of
this model as input in various artificial intelligence
projects, we aim to increase customer satisfaction
and develop more suitable products and services for
customers.
Screen enhancements were completed in order
to monitor and track investments for which the
ÇESMOD was completed, and a score was created.
Within this scope, an application was designed
to monitor the ÇESMOD and action plans of
investments.
According to İşbank’s Articles of Incorporation, Board
of Directors meetings can also be held electronically.
Accordingly, the Electronic Board of Directors
System (e-YKS), which will enable shareholders to
participate and vote in these meetings electronically,
was purchased from Merkezi Kayıt Kuruluşu A.Ş. and
installed.
It is planned that e-YKS, which was implemented
as a pilot in 2022, will be officially put into use as of
January 1, 2023, and that Board of Directors and
Board Committee decisions will be submitted to the
approval of the members via e-YKS and the electronic
signatures (e-signature/mobile signature) of the
members will be obtained. Thus, it will be possible to
carry out these processes, all of which are carried out
on paper, within the framework of paperless banking
and digitalization principles.
Thanks to projects such as Smart Legislation Search
and Letter of Guarantee Matching, developed with
Artificial Intelligence Natural Language Processing
algorithms, applications were developed to support
İşbank employees in their labor-intensive work,
reduce human error, and gain speed.
In order to acquire potential customers looking for housing
and vehicles at the source, mortgage and vehicle loan
applications received through loan comparison websites
and advertisement sites on digital media are digitally
transmitted to İşbank branches. In this way, sales channels
were diversified, and conversion rates on loan applications
were increased. With this effort, loans amounting to TL
246.9 billion were extended in 2022.
In 2022, TL 45.5 billion worth of loans were extended
within the scope of “Instant Loan”, “Instant Shopping
Loan”, and “Ready Limit” applications, which are
paperless banking applications where all processes
can be completed through digital channels such as
İşCep, Internet Branch, and the İş Bankası ile Öde (Pay
with İşbank) application that can be accessed through
contracted shopping sites. TL 26.1 billion in loans were
extended within the scope of the “My Loan is Ready”
application, which enables the completion of consumer
loan applications through digital channels, with the final
approval process completed at the branch regardless
of the channel where the process starts. The lending
rate through digital channels, which was 80% last year,
increased to 84.9% in 2022.
With the İş'te Limit (Limit at İşbank) application, which
shows the credit worthiness of İşbank customers, displays
the total limit of consumer loan, additional account, or
credit card products that can be allocated to the customer,
and also allows limit transfers between related products,
customers can apply directly from İşCep as well as our
branches. Customers with a set İş’te Limit can apply
directly from this screen for the relevant products within
their defined İş’te Limits. In addition to İşCep, customers
who have the appropriate permission can now proactively
inquire about and be offered an İş’te Limit through
RPA processes. TL 26.4 billion worth of İş’te Limit was
determined within the proactive İş’te Limit application, and
TL 616 million worth of İş’te Limit was determined within
the İş’te Limit application from İşCep.
In 2022, approximately 326 thousand additional accounts
with a total limit of TL 3.4 billion were opened through
digital channels.
In 2022, approximately
326 thousand
additional accounts with
a total limit of
TL 3.4 billion
were opened through
digital channels.
Digitalization in Branch Operations
In 2022, in order to reduce the number of counter
transactions at branches, efforts were made to develop
next-generation devices with a similar structure and
architecture to the counters where customers will receive
self-service and pilot implementation has been started in
three branches. In addition to cash transactions, efforts
are underway to address more customers with a wider
menu set with functions such as customer acquisition,
video calls, application processes, card delivery, digital
verification, and contract approval. Within the scope
of improving in-branch approval and authentication
processes, efforts are underway to ensure customer
authentication in the branch and in the field with the chip
ID card and biometric verification.
As of the end of December, expenditures for projects
carried out under the Digital Customer Experience of
the Future program amounted to TL 62.5 million. The
number of İşbank branches renovated as part of digital
transformation reached 578 as of year-end 2022.
Artificial Intelligence
Artificial intelligence applications managed within the
framework of the corporate vision and strategies at
İşbank aim to maximize customer experience and direct
employees to areas where they can create higher value
with the automation of low value-added processes.
Accordingly, an Artificial Intelligence Division was
established at the Bank. The "Agile working model" is
applied in artificial intelligence, which is one of the priority
areas of work.
As of year-end 2022, artificial intelligence investments
realized amounted to TL 43 million.
Artificial Intelligence Governance
Machine learning operations (MLOps) are used for
Artificial Intelligence to operate at İşbank on a large scale,
continuously learning and sustainably. The applications
and collaborations (technology, people, and processes)
developed within this scope are positioned as the key to
industrializing artificial intelligence. As a result, a single
platform suitable for corporate integration has been
introduced that manages the entire artificial intelligence
lifecycle end-to-end by standardizing and automating it.
Artificial Intelligence Ethics Approach
In order to manage Artificial Intelligence technologies
correctly and to create the expected effect, the principles
that İşbank adheres to were published as the Artificial
Intelligence Ethical Approach under the Ethical Manifesto.
Social Benefit and Sustainability: In our artificial
intelligence activities, in addition to sustainability, we
prioritize creating social benefit in many areas of life
such as economy, education, and culture, as well as
the principle of respect for the environment.
Impartiality: We make our AI decisions independent
of qualities such as race, origin, belief, status, and
gender, and we reject all forms of bias.
Transparency and Explainability: In our artificial
intelligence activities, in addition to sustainability, we
prioritize creating social benefit in many areas of life
such as economy, education, and culture, as well as
the principle of respect for the environment.
Durability: We run our artificial intelligence models
autonomously from end-to-end in our Bank’s cloud
infrastructure, where up-to-date technologies are used
in a way that is open to human control and closed to
human intervention. We take all security measures for
our models and provide the necessary controls.
Accountability: We record our artificial intelligence
activities in accordance with the legislation and its
purpose. Within our duties and authorities, we make
decisions as per the applicable legislation and banking
principles. We manage all processes centrally with the
İşbank Mozaik* platform we developed ourselves.
Security: We organize our artificial intelligence
activities in accordance with national, international, and
internal policies. We take and implement all measures
to prevent illegal transactions. We collaborate with
other banks and institutions in this regard and protect
bank and customer confidential information and
personal data within the framework of our information
security policies.
Innovation and Entrepreneurship
In order to make the right strategic moves and take the
right actions in the digital world where technology is
developing rapidly, İşbank continues to develop innovative
business models suitable for new competitive conditions.
Adopting an open innovation approach with its visionary
structure, İşbank supports joint cooperation models
with startups to develop new products and services and
closely monitors new ideas and technological trends
through innovation centers established in Türkiye and
abroad as well as technology companies, universities, and
institutions, and organizations in its network of contacts.
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Innovation at İşbank
Innovation efforts in 2022 closely monitored innovative
applications and solutions with the potential to impact
the future on a global scale, including the sustainability
field, and proof-of-concept studies were carried out for
innovative business models. The competencies of the
Forest for the Future application launched in 2021, in
which customers can convert the points they earn from
their spending, banking transactions, and daily activities
that contribute to nature into sapling donations, were
further developed. Within the framework of our Web 3.0
vision, which consists of the components of continuously
developing our competencies in blockchain technologies
through experimental studies, expanding the use of
smart contracts, creating beyond-banking products/
services that will enable the digital asset ecosystem to
become established, and designing physical ownership
links for digital assets, we aimed to utilize the value
propositions of blockchain and metaverse technologies
from various perspectives.
The budget allocated for R&D and innovation at İşbank
in 2022 was TL 206 million. In 2022, the actual budget
expenditure was TL 148 million.
Support for Entrepreneurship
As of its founding mission, supporting all economic
activities, especially entrepreneurship, and aiming to
provide this support in a sustainable and accessible
manner, İşbank carries out many activities to support
technology-based startups. In line with its vision of
being the bank of entrepreneurship and startups, the
Bank continued its ecosystem collaborations around
entrepreneurship programs, which have been ongoing
since 2017, and further expanded its network of
influence in this area. In 2022, the Bank collaborated with
52 initiatives and carried out campaigns and proof-of-
concept work.
The Bank continued to work intensively to support
the ecosystem through the Istanbul Entrepreneurship
Branch opened in 2021 and the Izmir Entrepreneurship
Branch which started operating in 2022. By the end
of the year, the total number of customers of the
Entrepreneurship Branches reached 656, of which 433
were newly brought to İşbank or activated customers
during the year. The number of business partnerships
established within the scope of non-financial value
propositions for entrepreneurs reached 9 by the end of
the year, and 52 entrepreneurs were enabled to develop
collaborations/campaigns with İşbank or its subsidiaries.
In 2022, the Technological Entrepreneur Package was
defined for the first time, providing privileges in our core
banking services and facilitating entry into the financial
system for a total of 265 startups.
In 2022, USD 1.2 million was invested in 4 startups, 2 of
which were follow-up investments, through the Maxis
Innovative Venture Capital Fund, of which İşbank is the
main investor and which was established to provide
resources to early-stage technology startups in the
entrepreneurship ecosystem.
Internal Entrepreneurship Program
Thanks to the "Internal Entrepreneurship Program",
which was launched to introduce innovative business
ideas and develop the employees' teamwork and
continuous learning skills, the employees have gained
the skills "to think and act like an entrepreneur" and
improved their innovation, creativity, risk-taking and
competitive thinking skills and also got the opportunity
to generate their ideas, detect problems, create solutions
and launch their products.
Entrepreneurship teams, which consist of employees,
improve their knowledge and awareness about
innovative business models, entrepreneurship and the
basics of internal entrepreneurship and are given training
and mentorship support from their program partners
that have experience in entrepreneurship. This program
aims to contribute to the transformation of İşbank's
innovative/entrepreneurial culture by providing all
employees across the country with competencies such
as entrepreneurship, teamwork, and continuous learning/
development.
Workup and WorkupAgri
Entrepreneurship Program
The Workup Entrepreneurship Program, which was
created to support and accelerate early-stage startups
with a technology-oriented, sustainable and scalable
business model, has continued since 2017. Eight
startups graduated with the Demo Day held in the
10th term of Workup. The 2nd term of the Workup
Agri Entrepreneurship Program, which was launched
to support new technologies in agriculture and related
topics and to add new collaborations to our agricultural
value proposition, continues with 6 startups.
140 startups have been accepted to the Workup
and WorkupAgri programs out of over 15 thousand
applications, and 100 of them have graduated with
Demo Day events. 2 out of every 3 Workup startups and
3 out of every 4 entrepreneur graduates continue to exist
in the entrepreneurship ecosystem. 40 Workup startups
received USD 15 million in investments during and after
the program.
Arya Women Investment Platform
Arya Venture Capital Fund
İşbank is the main sponsor of the Arya Women
Investment Platform, which has worked to increase both
investment and business development opportunities for
women entrepreneurs since 2018.
The Arya Investment Preparation Acceleration Program
is being organized as part of the collaboration between
İşbank and the Arya Women Investment Platform, in
which women entrepreneurs go through a 5-week
training and mentorship program to get ready to meet
investors. At the semi-final event, the entrepreneurs
included in the program deliver their investor
presentations and graduate from the program. In the final
part of the program, the Arya Retreat event, which brings
the remaining entrepreneurs together with investors
and lasts for 3 days, 3 entrepreneurship projects receive
awards after completion of the presentations delivered
to the jury and investors. The program also includes
workshops, and opportunities for collaboration and
networking are presented. The seventh Arya Retreat was
organized in 2022 with the theme “Invest in Women”.
A training series for women entrepreneurs is organized
under the name Arya Business Workshops; practical
information and cases are shared on topics such as
marketing, sales, finance, investment, and e-commerce.
The workshops also include the experience sharing of
entrepreneurs who are successful in their fields.
The trainings provided within the scope of Arya
Entrepreneur Academy aim to provide entrepreneurs
with basic awareness and the vision they need to
manage and grow their startups.
With the Arya Investor Academy, which focuses on
women’s angel investing, the basic elements of the angel
investing process are conveyed to women and women
are encouraged to become angel investors.
The number of women who
benefited from the Investment
Preparation Program and
the Retreat event, Business
Workshops, Entrepreneurship, and
Investor Academies reached 569.
In Türkiye, the biggest challenge women entrepreneurs’
face in realizing their dreams and reaching a certain
scale is access to finance and finding funding. Many
women with creative ideas, experience, and self-
confidence can start their own businesses if they
find financial support. Within this scope, the financial,
educational, and mentoring support to be provided to
women entrepreneurs from the foundation stage of their
businesses until they reach the stage where they grow
and contribute to the economy is of great importance.
More women entrepreneurs brought into the economy
means more production, more employment, and thus a
greater contribution to the national economy.
To this end, in 2022, Arya Women Investment Platform
and İşbank established a fund, which is aimed to reach
a minimum size of USD 10 million, to invest in gender-
balanced startups that offer the potential for sustainable
returns. The fund will invest in gender-balanced startups
and aims to become a venture capital fund with regional
impact.
WeLead
In cooperation with TÜRKONFED and İşbank and
with the support of UN Women Regional Office for
Europe and Central Asia, a new project called “WeLead
(Leading Women Entrepreneurship for Accelerating
Development)” was launched for women entrepreneurs.
The project aims to improve the capacities of
entrepreneurial women and strengthen their
communication networks. Within the project, it is planned
to provide training support to entrepreneurial women
regardless of sector and scale.
Training content is based on two pillars which are ‘gender
equality awareness’ and ‘technical capacity building’. The
technical content covers topics such as digitalization,
budget management, supply chain management and
branding, which were identified as a result of the WeLead
Research Report, the source for shaping the project.50
Within the project, 15 online and face-to-face training
programs were organized in 2022., 2022, the WeLead
Project, launched on June 1,2022, provided access to
training for more than 1,700 women entrepreneurs. The
project will continue with similar activities in 2023 as well.
50https://www.isbank.com.tr/bankamizi-taniyin/turkonfed-ve-is-bankasi-
girisimci-kadinlar-icin-guclerini-birlestirdi
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Women Entrepreneurship Loan
İşbank offers financing support to tradeswomen who want
to grow their business, to companies 51% of the shares
of which are held by female shareholders, or to women’s
enterprises that have at least one female senior executive
and at least 20% of the shares of which are held by female
shareholders, for all their business needs. As of year-end
2022, the Bank provided TL 25 billion✓ in financial support
to more than 62 thousand women entrepreneurs.
Export Support Loan with Turk Eximbank
İşbank provides financial support to women and young
entrepreneurs through the "Women Entrepreneurs Export
Support Loan" and "Young Entrepreneurs Export Support
Loan" products under the protocol entered into with Turk
Eximbank in order to increase the participation of women
and young entrepreneurs in export activities.
TÜBİTAK BİGG
Young entrepreneurs will be supported until 2025 within the
program launched in cooperation with İşbank and Özyeğin
University Fit Startup Factory to be the implementing
organization in the TÜBİTAK Individual Young Initiative
(BİGG) Program.
KWORKS Impact Entrepreneurship
Program
and being carried out in partnership with Vehbi Koç
Foundation, Workup, and Koç University Entrepreneurship
Research Center with the contributions of the Social
Entrepreneurship Network of Türkiye (TSGA), the Impact
Entrepreneurship Program, which was launched in May
2022, was completed, which aims to support the scaling of
technology-based startups that create or have the potential
to create environmental and social impact in areas such as
quality education, healthy and quality life, climate, accessible
and clean energy, and sustainable cities and communities.
With the Impact Day event held in October, 5 startups
graduated from the Program.
Sponsorships for Young Entrepreneur
Programs
İşbank was the main supporter of the Turkish
Entrepreneurship Foundation (GİRVAK) and TÜSİAD “Bu
Gençlikte İş Var” Program, which play an important role in
helping young people gain an entrepreneurial perspective at
an early age and see entrepreneurship as a career path.
FounderOne
FounderOne, a next-generation investment fund aiming to
invest in early-stage impact startups, was established in
June 2022 in cooperation with the Turkish Entrepreneurship
Foundation, Turkish Informatics Foundation, and our
subsidiary Maxis Girişim Sermayesi Portföy Yönetim A.Ş.
Next-Generation Contact Point:
İş Mekan
With the aim of designing the customer
experience and the Bank of the Future, the
Next-Generation Contact Point project was
started and branded as İş Mekan with the aim
of reaching our customers we contact digitally
in the physical world and meeting their needs
more holistically as the İşbank Group without
limiting them to banking processes.
The aim is to continuously improve the
customer experience and strengthen customer
belonging and loyalty through İş Mekan’s
contact points whose concepts will vary
according to different customer profiles and
market characteristics.
İş Mekan, which started operations in Nişantaşı,
has created an ecosystem where visitors can
meet İşbank Group brands and platforms in
addition to performing banking transactions. İş
Mekan features a corner for İş Kültür Publishing
where visitors can enjoy a pleasant bookstore
experience, the first physical point of sale of
İşbank’s online shopping platform Pazarama,
and a café offering a next-generation coffee
experience. In addition, there are meeting rooms
rented by our subsidiary İşmer and workspaces
that all our customers can use free of charge. İş
Mekan has been designed to inspire its visitors
with a variety of events and activities that will
bring them together on a regular basis to create
a community.
In order to support the physical İş Mekan
experience area digitally and to provide a holistic
experience, the İş Mekan mobile application,
which is complementary to the physical İş
Mekan experience, has been offered to our
customers in the app marketplaces. With this
application, users will be able to book meeting
rooms at the İş Mekan, book spaces for events
and, with future developments, be informed
about campaigns and announcements before
anyone else. In this way, the aim is to create a
collective customer experience by supporting
the service offered in the physical world in the
digital world as well.
Information Security at İşbank
İşbank works meticulously to ensure the reliability
of its operations against risks related to information
confidentiality and cybersecurity, which are increasing
with digitalization. The processes related to ensuring the
security of information systems and the secure storage
of personal data and confidential information, which are
the most important issues of our day, are maintained
through regular investments in the field of security and
training and awareness activities for the continuous
development of a security culture.
The Board of Directors has the ultimate responsibility to
ensure information security within İşbank. To this end,
the Board of Directors develops the required strategy
and oversees its implementation via the committee.
The Information Security Committee is responsible for
establishing and implementing policies for information
and personal data security. All organization units of the
Bank are responsible, within the boundaries of their
areas of responsibility, for carrying out their activities
in accordance with these policies and other sub-
regulations based on them.
Policies and other sub-regulations regarding information
security and personal data form the basis of any
actions to be taken within this scope. Through constant
awareness programs, the Bank strives to increase the
knowledge of its employees and raise awareness among
end users.
In 2022, 8.933 employees from the Head Office and
branches received a total of 9,853 hours of training
in the fields of cybersecurity, social engineering and
information security.
İşbank's banking processes and information systems
are annually audited by the Board of Inspectors in a risk-
based manner to provide a basis for the Management's
Statement to be submitted to an independent auditor
in accordance with the "Regulation on External Audit
Institutions’ Information Systems and Banking Processes
Audits" published by the Turkish Banking Regulation
and Supervision Agency (BRSA). Processes for ensuring
information security are absolutely covered during the
audits of information systems.
With priority given to the control targets regarding
the provisions included in the "Information Security
Management" section of the BSEB regulation, and
within the framework of the mentioned regulations, the
existence, adequacy and effectiveness of a process that
includes activities such as risk assessment, approval of
the corporate information security policy by the Board
of Directors and supervision of its implementation by
the Senior Management, conducting studies to increase
the awareness of the Bank personnel on information
security, classifying all data according to the degree of
security sensitivity and conducting security controls at
the appropriate level for each class, implementation of
information security tests, prevention of data loss, and
updates of existing controls and structures created
according to technological developments are evaluated.
In line with audit studies for information technologies
(IT), inspections are carried out to contribute to
the achievement of basic goals for the healthy
management of IT risks and the effective and efficient
use of IT resources. The scope of the said audit work is
determined by a risk assessment prepared by taking into
account the criticality of the applications and systems
for the Bank and their sensitivity in terms of data security.
These system-oriented technical inspections are carried
out on the basis of local legislation and international
best practices, including especially the articles of the
BSEB regulation which are directly related to ensuring
information security.
The internal control environments regarding information
security of İşbank's subsidiaries and affiliates and the
organizations from which the Bank receives support
services are also evaluated through audit activities,
similar to the audit activities carried out within the Bank.
As per the communiqué “Penetration Tests for
Information Systems” published by BSRA, banks are
required to carry out penetration testing at least once
a year. The purpose of penetration testing is to identify
and fix vulnerabilities that may result in unauthorized
access to the Bank's information systems or sensitive
data before such vulnerabilities are exploited. External
firms have been carrying out penetration tests at İşbank
since 2012 in accordance with the communiqué.
Penetration test action plans prepared on a quarterly
basis by Information Security regarding the findings of
the penetration tests are reviewed by the audit team, and
the "Penetration Test Finding Follow-up Report" for the
current year is reported in the following year.
In the ordinary audit activities and investigations
carried out by the members of the Board of Inspectors,
the effectiveness of the measures taken for the
confidentiality of customer information is reviewed. In
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case of a customer complaint submitted to the Bank
in relation to an alleged breach of confidentiality due
to loss or disclosure of customer information to third
parties, the issue is meticulously handled in all aspects,
and the audit results are reported. Within the scope of
the investigations, the data and audit trails in the Bank's
systems are analyzed in a holistic and detailed manner,
and any situations that indicate reasonable doubt are
examined from an analytical perspective. In the event
of a reasonable suspicion that such information is
disclosed to third parties, investigations on the subject
are expanded, and if these suspicions reflect the truth,
the necessary measures and decisions within the scope
of both internal regulations and legal legislation are taken
without delay. In addition, the processes described in
the Bank legislation regarding provision of information to
customers about the outcome of such complaints are
executed in order to ensure that the complaint owners
are notified about the outcome of the investigations.
Within the scope of internal audit activities, all
investigation results are reported to the Board of
Directors through the Audit Committee; within the
framework of audit reports, it is ensured that the
measures taken by the relevant unit managements are
monitored.
The Internal Control Division information systems internal
control activities team conducted inspections at 76
checkpoints for the Bank’s information security process.
In addition, various checkpoints for cybersecurity on
the Bank’s critical IT assets are regularly monitored at
daily, weekly, and monthly intervals as part of level two
controls, and the identified operational issues are shared
with the relevant IT units to correct them.
The control activities of the Internal Control Division
within this scope include:
access to databases,
authorization and security parameter controls,
controls for the security of privileged public user
accounts and user groups on servers and databases,
activity controls of high-privilege users on critical
servers and applications for information security,
server anti-virus software controls,
controls for the security of server audit trails,
data leakage prevention system controls
Additionally, regular access and authorization controls
are done to ensure that end-user privileges in basic
applications used for the main banking processes are up
to date.
Within the framework of the security architecture,
there are multiple layers in the communication
network infrastructure of İşbank. Anti-DDoS solutions
are positioned to prevent suspicious external DDoS
(Distributed Denial of Dervice) traffic. In the outermost
network, incoming and outgoing traffic is controlled
by IPS (Intrusion Prevention Systems) and WAF (Web
Application Firewall) systems. In order to increase
security on the communication network, different zones
have been created on the network. Within each zone,
there are different firewalls and access control lists
(ACLs), and zones are protected by customized rules
and security defense mechanisms. In addition, different
switches and VLANs (Virtual Local Area Networks)
have been established in different zones. Outgoing
internet traffic is analyzed by secure socket layer
(SSL) monitoring tools and protected by sandbox APT
(Advanced Persistent Threat) systems. All server and
endpoint devices are protected by endpoint security
solutions. Authorizations in the systems are made
based on role and in accordance with the principle of
separation of duties, and authorizations are regularly
reviewed. The trace records created on the systems are
transferred to SIEM products, and security warnings are
followed by the Security Intelligence and Defense Center
within the framework of predetermined rules on a 24/7
basis, and actions are taken regarding security incidents.
At İşbank, regular penetration tests are conducted to
detect possible system vulnerabilities. Systems are
patched to fix any detected vulnerabilities. Information
security awareness training is provided and phishing
tests are done to increase awareness among Bank
employees.
Risky transactions made by the Bank’s customers
through digital banking channels are regularly monitored.
Current risks and threats are evaluated and necessary
actions are taken quickly. In addition, efforts to raise
customer awareness of current risks and threats were
given importance and priority.
In 2022, approximately TL 78 million was invested in
information security and cybersecurity fields.
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 03
Responsible
Operations
104 Reducing Negative Impact of Our Operations
114 Decent Work
104 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 105
Reducing Negative
Impacts of Operations
As one of the biggest banks in Türkiye, İşbank offers services to millions of users with its operations
throughout the country. When managing its widespread network of operations, the Bank aims to
minimize its environmental impact, ensure its suppliers embrace identical working norms, and be
a reliable employer for all its employees.
Related Capital
Elements
Relevant Stakeholders
ᲁEmployees
ᲁBusiness Partners
ᲁSuppliers
Material Topics
ᲁThe Bank's
environmental
footprint
ᲁResponsible
Procurement and
Supply Chain
Risks
Increase in operational expenses with rising energy
costs
Failure to meet the requirements of corporate
commitments due to non-compliance with
environmental regulations
Loss of reputation due to adverse events that may
occur in the supply chain
Operational risks that may occur due to disruptions
in the supply chain
Opportunities
Reducing operational expenses and observing
resource efficiency with energy efficiency,
reduction of water consumption, and paperless
banking practices
Realizing cooperation that will provide efficiency
with effective supply chain management
Contributed SDGs
Targets
Targets for 2022
Realization in 2022
Realization
In line with its goal to reduce greenhouse gas emissions,
the Bank aims to reduce the total Scope-1 and Scope-2
emissions calculated in accordance with the International
GHG Protocol by 38% by 2025, 65% by 2030, and to
zero by 2035, and carry out its activities as carbon-
neutral as of 2035 (target baseline year: 2018)
The Bank aims to meet at least 50% of the eligible
consumer electricity consumption from clean energy
sources by 2025 and 100% by 2030, in line with its
greenhouse gas emission reduction targets (target
baseline year: 2021)
Obtaining the ISO 14001 Environmental Management
System certification to cover all operation and service
locations of the Bank by the end of 2022
75%
100%
100%
Based on 2020, zero paper consumption in banking
activities until 2024 through digitalized processes
Savings of 190 million
pages
In order to reduce negative environmental impacts in
2021 and beyond, the following targets have been set:
Reducing water consumption by switching to water-
saving aerators in all sink faucets of branches,
Saving energy by continuing to change the lighting
fixtures to LEDs,
Continuing to replace old type air conditioners with
new generation air conditioners with higher efficiency.
In addition, LED conversion of lighting fixtures in 125
branches was planned to be realized in 2022.
LED conversion of 250
branches was completed
in 2022. The replacement
of old generation air
conditioners with
next-generation
models continues in our
renovated branches.
✓⃝
✓⃝
✓⃝
Targets for 2023
and Beyond
Maintaining the
current level
Maintaining the
current level
Maintaining the
current level
Savings of 196
million pages
Reducing electricity
and natural gas
consumption by 5%
and emissions from
vehicle use by 5-10%
in the coming period,
By the end of 2023,
LED conversions of all
branches are planned
to be completed.
Targets for 2022
Realization in 2022
Realization
Targets for 2023 and Beyond
Maintaining the local supplier ratio
at 98%
97.09%
The green procurement* ratio is
aimed to not fall below 3%.
4%
×⃝●
✓⃝
The ratio is aimed to not fall below 96%.
The green procurement ratio is aimed to
not fall below 3% until 2025.
* Green procurement includes all products/services produced from environmentally friendly/recyclable materials and/or that cause less damage to the environment.
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Key Performance Indicators
GHG Emissions (ton CO2e)1✓
Scope 1
Scope 2
Scope 3
Total (Scope 1 + Scope 2)
Emission Intensities✓
Emission per employee
(tCO2e/number of employees)
Emission according to consolidated total assets
(tCO2e/TL million)
Emission according to consolidated total assets
(tCO2e/USD million)
Emissions by consolidated net profit
(tCO2e/TL million)
Emissions by consolidated net profit
(tCO2e/USD million)
USD Balance Sheet Rate
Energy Consumption1✓
2018
2019
2020
2021
2022
20,629
22,528
22,119
20,472
68,599
10,563
89,071
4.40
0.20
0.93
21,789
71,781
8,727
93,570
4.30
0.20
0.98
57,193
7,779
77,822
3.40
0.10
0.80
8,784
6,458
31,312
1.40
0.03
0.36
0 2
10,846
22,119
0.95
0.01
0.24
0.32
14.94
17.02
10.00
2.00
61.64
78.38
5.24
5.89
74.14
7.39
26.33
5.97
13.09
18.65
Total Energy Consumption (GJ)
756,517
670,254
588,942
630,216
607,022
Total Energy Consumption (MWh)
Total Electricity Consumption (MWh)2
210,144
127,989
186.18
132,501
163.59
119,912
175.06
121,404
168,617
122,652
Total Natural Gas Consumption (m3)
4,126,643
3,879,943
4,178,163
5,284,460
4,529,353
8,000
170,586
6,400
78,713
14,710
77,606
11,296
21,869
1,011
26,954
Fuel Oil Consumption (lt)
Coal Consumption (kg)
Diesel Consumption (lt)
Total Water Consumption (m3)✓
City Water
365,424
335,964
278,890
262,235
282,919
Rainwater (recovered/re-used water)
5,820
9,425
3,588
Drinking Water3 (tanker water + bottled water)
-
-
-
7,947
5,470
8,820
3,063
Total Amount of Wastewater
371,244
345,389
282,477
270,182
291,739
Vehicle Fuel Consumption (lt)✓
Fuel Consumption of Company Vehicles (Diesel)
2,718,367
4,012,798
3,639,660
3,155,927
2,659,440
Fuel Consumption of Company Vehicles
(Gasoline)
15,335
11,982
7,592
334,694
1,344,827
Fuel Consumption of Employee Shuttles (Diesel)
562,655
541,627
535,390
550,100
530,861
Business Trips with Personal Vehicles (Diesel)
Business Trips with Personal Vehicles (Gasoline)
Business Trips with Personal Vehicles (LPG)
-
-
-
-
-
-
36,685
42,740
22,259
40,352
43,731
27,035
57,855
65,546
26,014
Paper Consumption (ton) ✓
Amount of Waste (ton)4 ✓
Total Amount of Waste
Amount of Domestic Waste
Amount of Hazardous Waste (batteries,
fluorescent lamps, car batteries, cells, toner
cartridges, medical waste)
Medical waste
Amount of Electronic Waste
Total amount of waste recycled5 (ton) ✓
Amount of paper waste recycled (ton) ✓
Amount of non-hazardous waste recycled6 (ton) ✓
Plastics
Metal
Glass
Plastics + Metal (Branch)
Amount of hazardous waste recycled6 (ton) ✓
Batteries
Fluorescent lamps
Car batteries
Cells
Toner cartridges
Total amount of hazardous waste (Branch)
14
1
9
251
200
29
-
-
-
-
13
-
-
-
-
-
-
9
2018
2019
2020
2021
2022
808
679
643
503
963
2,116
1,884
1,964
1,757
1,026
861
7
2
30
205
129
41
-
-
-
-
5
-
-
-
-
-
-
8
1
37
163
94
25
-
-
-
-
7
-
-
-
-
-
-
1,570
1,001
12
2
23
568
346
189
-
-
-
-
10
-
-
-
-
-
-
1,719
1,118
6
3
74
599
353
164
10
5
59
90
8
1
0.35
2
0
0.28
5
74
1 The emission and consumption data reported in 2018 included the Head Office buildings, all domestic branches and regional directorates, and in 2019, the Atlas Data Center was also
added to this data. The increase in electricity consumption in 2019 was partly due to the inclusion of the data center.
2 Since the electricity consumption is IREC-certified, Scope 2 emissions are calculated as “0”. In 2022, the amount of energy generated from renewable energy sources accounted for
100% of the total energy consumption.
3 Represents the amount of drinking water consumed in the Head Office buildings. Drinking water for these buildings is supplied by tankers, carboys, and bottled water, and it has been
monitored since 2021. In service buildings with ISO14001 certification, drinking water is supplied by bottled and carboy water.
4 2018-2019-2020 data only includes the Head Office buildings. 2021 and 2022 data includes the Head Office buildings as well as the service buildings with ISO 14001 certification.
5 The total amount of recycled waste consists of recycled non-hazardous wastes, recycled hazardous wastes, paper wastes and electronic wastes, and includes the data of the Head
Office buildings.
6 The breakdown of recycled non-hazardous and hazardous waste amounts by waste type was started as of 2022, and the reported data includes the data of the Head Office buildings.
2018
2019
2020
2021
2022
Number of Local Suppliers
Ratio of Local Suppliers* (%)
Ratio of Procurement from Local Suppliers (%)
Total Number of Suppliers
2,673
97.41
92
2,744
3,396
97.42
91
3,486
3,673
97.09
87.71
3,783
*While calculating the ratios, companies registered in the trade registry and operating in Türkiye were accepted as local companies.
417,479
351,180
320,068
282,318
333,258
Amount of electronic waste recycled (ton) ✓
30
37
23
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Environmental Impact Management
Environmentally Friendly Buildings
Believing that using natural resources responsibly
and minimizing the impact on the environment while
conducting its activities are fundamental duties of both
individuals and institutions, İşbank takes responsibility
for climate action in order to maintain its operations with
minimal environmental impact. The Bank bases this
responsibility on the targets it sets and the commitments
it makes. Additionally, İşbank is undertaking many
improvement and energy-efficiency projects to mitigate
the negative environmental impact it causes.
Climate targets
Within the scope of combating climate change, İşbank
established its strategy on climate change risk, and
climate change was added to the Bank’s risk catalogue.
In the combat against climate change, İşbank set its
target for reduction of greenhouse gas emissions and
stated it in its disclosure under the CDP Climate Change
Program:
"To reduce the total Scope-1 and Scope-2 greenhouse
gas emissions calculated in accordance with the
International GHG Protocol by 38% by 2025, 65% by
2030, and to zero by 2035, and to carry out activities as
carbon-neutral as of 2035 (target baseline year: 2018)"
İşbank made a commitment to the Science Based
Targets Initiative (SBTi) for identified science-based
emission reduction targets to be validated. In 2023, it is
aimed to go beyond these targets and evaluate Scope-3
emissions from lending activities and the supply chain
with a target-based approach.
İşbank was awarded
a score of “A-" in the
CDP Climate Change
Program in 2022.
Environmental Management
At İşbank, an ISO 14001 Environmental Management
System Project has been in place since 2018 in order
to reduce its environmental impact and build an
environmental management system that complies
with international standards. Within this scope, training
is provided to employees working in the position of
environmental officer. In 2022, our 638 employees
who will serve as environmental officers attended the
“Environmental Management System (ISO 14001)
Training” and 12 employees who will conduct the
internal audit of this system attended the “Environmental
Management System (ISO 14001) Internal Auditor
Training”. Employees who start their careers at İşbank
are provided with information about the Environmental
Management (ISO 14001) System in the “Getting to
Know Our Bank” course as part of the “Starting My
Career” Training. In addition, employees were provided
with information and awareness on the environmental
management system through online workshops.
The Environmental Management System is audited by
the Internal Control Division on an annual basis. The
Bank has not incurred any fines for non-compliance
with environmental laws and regulations during the
reporting period.
As of 2022, İşbank has ISO 14001 Environmental
Management System Certificates for 1,178 locations.
Efforts are underway to obtain zero waste certification
in line with the Zero Waste Legislation at the covered
locations. At the end of 2022, the ratio of certified
locations to the Bank’s total locations was 100%, and
efforts are underway to include newly opened branches
in the certification process. With the newly launched
Sustainability Platform, data collection from branches is
carried out through an online application. İşbank aims to
maintain its environmental management system which
complies with international standards in the coming years.
İşbank has awareness of the destruction of nature and
economic loss caused by electronic waste. Therefore
İşbank sells scrap and returns toner cartridges to
recycle field assets whose life cycle is managed by
the Information Technologies Division. All companies
to which sales are made have WEEE certificates. All
recycling operations are outsourced to authorized
companies in line with the Bank’s general rules.
As of 2022, the Bank has ISO 14001 Environmental
Management System Certificates for 1,178 locations
(100% of total locations).
Environmentally friendly buildings play a key role in
reducing the environmental impact of İşbank's activities.
İşbank's big buildings, such as the Head Office,
operations center and data center, were designed to
minimize their environmental impact. İşbank Head
Office building in Levent, Istanbul has a BREEAM In-use
Excellent certificate. Additionally, Tuzla Technology and
Operations Center (TUTOM) received the LEED Gold
certificate.
From 2020 when remote working arrangements were
put in place to the end of 2021, electricity consumption
at the Head Office locations decreased by 8.4%.
The Bank’s Tuzla Data Center (Atlas) building has the
LEED v4 Gold for Data Centers certification and is the
first data center in Türkiye to meet these standards. In
the Atlas Data Center building, the heated air generated
after the data halls with IT cabinets are cooled with air
is used to heat the office areas. In this way, the Bank’s
energy consumption is reduced, and energy savings are
achieved.
In addition, rainwater is collected through rainwater
collection channels installed in our buildings, treated to a
certain level and then reused in various areas.
At the Head Office and TUTOM buildings, all waste
is sorted and recycled according to the ISO 14001
Environmental Management System Standard.
Efficiency in Branches
İşbank aims to use energy and resources efficiently in
order to reduce the environmental impact of its service
buildings and carries out such efficiency activities with a
continuous improvement approach.
In 2022, during the renovation work in the Bank, branch
lighting, heating, and cooling systems were modernized.
Existing lights were replaced with LED lighting, while old
air conditioners were replaced with high energy-efficient
units, and natural gas conversion was carried out at
branches that were heated with coal or diesel fuel.
At our Head Office building, the heating, cooling and
domestic water system pumps were replaced with more
energy-efficient models. LED conversion of lighting
fixtures in all service buildings is ongoing. It is planned to
be completed by the end of 2023.
At all service buildings, conventional flush tanks were
replaced with new models that use less water, and
urinals with photocell control were chosen to replace
existing urinal flush tanks. Lavatory faucets in all service
buildings were replaced with water-saving faucets. It is
estimated that 15% water savings will be achieved with
these measures.
As a result of the improvements and upgrades made for
higher energy efficiency, emissions (scope 1+scope 2)
were reduced by 9,196 tCO2e.
Visors are being installed on Bankamatik ATMs that
convert solar energy into electric energy and help
reduce energy consumption. Acting as solar panels,
the Bankamatik ATM visors can meet a significant
portion of the energy need of façade lighting, except
for the advertisement panels. By the end of 2022,
68 Bankamatik ATMs with solar panels produced
330 Wh per device per day. These systems are in the
testing stage, and it is planned to expand their use to all
renovated units from 2022 onwards. In addition, İşbank
plans to invest in a solar farm covering all its branches in
2023.
Efforts to reduce single-use plastics in branches
and Head Office buildings are ongoing. The use
of disposable water cups, of which 317,840 were
consumed in 2022, was terminated within the year;
similarly, the purchase of new cardboard cups at the
Head Office building was also terminated
In 2022, 190 million✓ sheets
of paper and TL 22 million in
paper costs were saved through
digital, digital signature, and KEP
delivery practices.
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Responsible Procurement
Sustainable development is only possible through
responsible business models. Positive or negative
impacts caused by organizations are not confined to the
area of its operations but may affect a large area based
on the organization’s size. Aware of its responsibilities,
İşbank aims to propagate its approach to, and standards
of, business to its supply chain as well. By collaborating
with its suppliers, the Bank tries to ensure that best
practices and products extend to an even larger area.
İşbank works to achieve sustainable business success
with a financially strong, environmentally friendly supply
chain that is also reliable with high-quality production
and continuity.
In order to leave a more livable world for future
generations, it is of critical importance to protect
the environment and use resources in a sustainable
manner. In addition, the importance given to employee
and human rights and compliance with ethical
principles have a great impact on the development
of societies and countries. Within this context,
sustainability criteria come to the forefront in product/
service procurement in order to contribute to the
said values. In accordance with the Sustainability
Policy, İşbank endeavors to minimize the negative
environmental and social impacts caused by suppliers
and to raise the positive effects to maximum levels.
In this context, the Bank respects environmental and
social criteria in its supplier selection.
The Bank follows a procurement strategy that
envisages contributing to the sustainability of the
ecosystem, including its suppliers, through its social
and environmental policies based on growing together
with stakeholders. In line with İşbank's ethical banking
approach, the Supplier Code of Conduct, based on the
UN Global Compact and İşbank Human Rights and
Human Resources Policy, determines the main principles
and essentials in purchases of goods and services. All
suppliers are expected to show due diligence in acting
in compliance with these principles and policies and
to refrain from behaviors that may be contrary to these
principles. In order to carry out healthy and sustainable
procurement processes, İşbank expects its suppliers to
have values identical to its own.
CIPS Certification
The conformance of the Bank’s purchasing
organization and processes to international
standards was certified with the CIPS (The
Chartered Institute of Procurement & Supply)
certificate it obtained in 2021. CIPS is one of
the leading professional institutes that sets
the best practices and standards in the field of
procurement and supply chain management.
The Bank is the first organization in the
Turkish banking and finance sector to receive
this certificate.
Within the framework of İşbank's Procurement
Implementation Instruction and Procurement Policy, the
environmental impact of the products and services to be
purchased is also evaluated as per the requirements of
the environmental management system in the selection
of suppliers from which the products or services needed
by the Bank will be purchased. In addition, measures
are taken to reduce or eliminate environmental impacts,
taking into account the requirements specified in the
country’s legislation and the Bank’s regulations.
The Bank cooperates with suppliers whose working
principles are compatible with the Bank’s sensitivities in
terms of human rights, environmental and social impacts.
Supplier selection is carried out within the principles
set forth in the Procurement Policy and Implementation
Instruction. Article 2 of the Supplier Management
Principles states "No person is employed under the age
limit defined in the legal legislation. ”. In addition, the Bank
does online research and looks into the market sources
to gather information about suppliers. Furthermore,
suppliers are visited on a regular basis as part of a
specially designed program. Within this context, there
are no suppliers that employ child labor, or no information
has been received in this regard. At the same time,
our suppliers are asked whether they have policies to
prevent child labor in the Sustainability Survey directed to
them once a year
The Supplier Management Principles, Anti-Bribery,
Anti-Corruption, and Gift and Hospitality Policies,
which set out the basic principles and principles to be
followed in the relations between İşbank and suppliers
from whom products and services will be purchased,
can be accessed from the procurement platform. Thus,
suppliers can be informed about procurement processes
and policies while registering on İşbank's procurement
platform. These policies are also available on the Bank’s
website and are accessible to all stakeholders.
The Supplier Management Principles on the home page
of İşbank’s procurement platform detail the sensitivities
that suppliers must comply with. The sensitivities
specified in the Principles are observed in supplier
selection. No purchase is made from suppliers who
cannot submit the required documents.
A large proportion of İşbank's suppliers are well-known
companies in the sector that fulfill their legal obligations
due to their position in society. In the reporting period,
there was no information on any negative impact related
to suppliers in terms of human rights, working conditions,
and social criteria.
İşbank aims to collaborate with its global peers and
suppliers in order to be a pioneer in sustainability by
benefiting from best practices and product examples.
Like environmental criteria, social criteria are also
important in the selection of suppliers at İşbank. The
Bank is highly respectful of association and collective
bargaining rights. Sensitivities on this issue are taken into
consideration in supplier selection. Purchases of goods
and services from suppliers that are found to be involved
in practices of bribery and corruption are suspended,
and such suppliers are banned. The supplier cannot
employ workers under the age limit defined in the legal
legislation. For our suppliers, who were visited regularly,
no feedback with a negative social impact was received
during their reporting periods.
İşbank works to achieve sustainable business success
with a financially strong, environmentally friendly supply
chain that is also reliable with high-quality production
and continuity. The Bank adopts the principle of
continuously improving its employees along with its
suppliers, ensuring organizational excellence and
consistently improving business processes. When
selecting suppliers, the Bank chooses one from its
existing pool of suppliers based on the nature of
procurement in question or tries to reach new alternative
suppliers by looking at predefined criteria. In addition
to the specified criteria, the Bank also takes different
parameters into consideration, such as reference checks,
sector analysis, and financial analysis when identifying
alternative suppliers.
Each year, the business unit that uses the product/service
is asked a number of questions for supplier evaluation
within the supplier performance management study.
Specialized employees working in the Procurement
Division also evaluate suppliers through the questions
directed to them. This study is carried out systematically
through the purchasing application for the suppliers that
account for a large portion of the purchases.
As part of supply chain management, İşbank expects its
suppliers to:
Act in accordance with environmental and ethical
rules,
Be able to adapt to the developing and changing
sector conditions,
Meet the Bank's expectations of quality-logistics
performance,
Be open to cooperation to reduce the negative impact
of the production process on the environment,
Prefer environmentally friendly raw materials and
supplies with minimal impact on the environment in
procurement activities,
Try to minimize the environmental impact associated
with their production and logistics processes.
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In current procurement processes, environmental/social
impacts are taken into account in supplier selection;
Boxes purchased in 2022 were made entirely from
recyclable materials.
The work chairs purchased for the Head Office
buildings and branch managers in 2022 were made
of 95% recycled material.
The carpets purchased for agile offices are carbon
neutral.
High-energy class air conditioners are preferred for
the air conditioning requirements.
Certificates of compliance with environmental
regulations such as Waste Electrical and Electronic
Equipment Processing Certificate, Non-Hazardous
Waste Collection-Separation Certificate, Waste
Battery and Accumulator Temporary Storage Permit,
Hazardous Waste Transport Vehicle Licenses,
and ISO 14001 Certificate are requested from
participating companies in scrap sale tenders.
With the tender held in 2022, renewable energy
sources were preferred for the entire electricity
consumption under the Bank’s control in the
electricity purchase for 2023.
In 2022, hybrid vehicles were preferred for most of
the vehicle leasing contracts.
İşbank has adopted the principle of continuously
improving its suppliers, ensuring organizational
excellence, and consistently improving business
processes. The Bank continued to contribute to the
national economy by selecting local suppliers in 2022
as well. Therefore, local suppliers accounted for 97% of
the total suppliers, while the amount of procurement from
local suppliers accounted for 88% of the total volume of
procurement during the reporting period.
İşbank also monitors the environmental impacts of its
supply chain. In the Supplier Management Principles, it
is stated that environmental criteria are also effective in
supplier selection. In purchases with high environmental
impact, suppliers are evaluated according to their
competencies and no purchase is made from suppliers
who cannot submit the necessary documents. For such
special purchase activities, suppliers that submit the
required documentation are preferred, regardless of
price.
A Sustainability Survey is sent to suppliers once a year.
Suppliers from which the Bank buys a large amount
of products/services via its purchasing application are
subject to a survey which included 38 questions in the
main topics of environment, labor and human rights,
ethics, and sustainable purchasing. The survey, which
was conducted to understand at what stage suppliers
are in terms of sustainability, also aims to raise their
awareness on this topic.
A total of 30 suppliers, constituting 57% of purchasing,
participated in the survey which was sent to suppliers
covering 71% of purchases for 2022. The survey
consists of 38 questions in total - 24 under Environment,
8 under Employee and Human Rights, 4 under Ethics,
and 2 under Sustainable Purchasing topics.- The survey
also includes questions on water management, such as
the total amount of water used in production, targets set
to reduce water consumption, whether reporting is done
for water use, and actions taken to reduce water use.
All purchasing is carried out in accordance with the
Supplier Management Principles, Gender Equality, and
Human Rights policies available on the Bank’s website.
The Bank observes gender equality in all its activities and
aims to create opportunities to raise awareness on the
topic. The aforementioned survey sent to suppliers also
includes questions on gender equality.
Business Continuity Management
Program
The Business Continuity Management Program, which
has been carried out at İşbank since 2009 as a holistic
management process aimed at creating an effective
response capability to protect the institution’s reputation,
brand, and value-creating activities, is in compliance with
the ISO 22301 standard and legal regulations in Türkiye.
Under the program, studies that will constitute inputs
to information systems recovery plans and strategies
are carried out, and the continuity of our branches is
monitored. The program is supported by trainings for all
employees.
In 2022, it was ensured that business continuity
recovery strategies were implemented within one
business day in branches where service interruptions
occurred, except for regional disasters; 2 online
trainings planned for Business Continuity Coordinators
were held on March 29 and 31, 2022 with the
participation of 65 managers; all business continuity
plans were updated within the studies carried out
throughout the year; and all planned business impact
analysis studies were completed. The completion ratio
of the Business Continuity Management Digital Training,
which was directed to a total of 23,019 employees, was
93.99% as of October 2022.
In 2022, the Business Continuity Management Policy,
which constitutes the framework of the program, was
updated in line with the developments in this field,
particularly the Regulation on Banks' Information
Systems and Electronic Banking Services (BSEB
Regulation). In line with the business continuity
experiences gained during the pandemic, the Workflows
to be followed by our branches in the event of Prolonged
System Outages were published for our branches.
The ratio of employees with ISO 22301 Certification
among the Business Continuity Team employees was
100%. The inclusion of the Remote Working Service
Level Agreement in 2022 among the Service Level
Agreements that include monitoring indicators for the
continuity of İşbank Information Systems Applications
is considered as one of the reflections of new working
models on the program.
Considering the reflections of new working models on
the activities carried out within the program, studies will
be carried out also in 2023 by adopting the continuous
improvement and development approach, which is
emphasized in the essence of the ISO 22301 standard,
and it is aimed to increase effectiveness with application
support as well.
Within the Business Impact Analysis studies carried
out under the İşbank Business Continuity Management
Program, all Bank processes, including our critical
services, are evaluated every year in terms of;
Financial Impacts
Reputational Impacts
Legal, Legislative, and Contractual Impacts
Operational and Business Goal Impacts
that may occur if processes are interrupted, by the
relevant Head Office Divisions, and as a result of the
evaluation, the “Criticality Level” of each process is
determined as Very High, High, Medium, and Low.
Business Continuity Plans are prepared on the basis
of each Head Office Division in order to ensure that
the processes can be restored before the anticipated
Maximum Tolerable Period of Disruption (MTPD) in case
of any interruption.
The Information Systems Continuity Plan, which is a part
of the Bank’s Business Continuity Management Program,
ensures the continuity of information systems services
that maintain the continuity of İşbank’s activities in the
event of an interruption and ensures that critical business
functions are restarted effectively and efficiently in the
event of a major interruption in the Bank’s computer and
communication resources.
The potential impacts natural disasters and extreme
weather conditions may have on our operations are
included among the location-based extraordinary
conditions the branch/regional/general directorate units
may face within the activities conducted for ensuring
the Bank’s business and service continuity and among
extraordinary conditions which may cause interruptions
in terms of providing the continuity of the Bank’s
systems. Said risks are considered in the corporate crisis
management processes, and in case said risks occur, the
emergency management processes to be implemented
are all defined in the Business Continuity Plans and IS
Continuity Plan.
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Decent Work
At İşbank, employees enjoy a respectful, peaceful, safe, fair,
and supportive work environment. Having happy and
productive employees with a vision of the future is one of İşbank’s primary goals.
Related Capital
Elements
Relevant Stakeholders
ᲁEmployees
Material Topics
ᲁEmployee Rights
Loyalty and
Satisfaction
ᲁFuture of Work and
New Working Models
ᲁEqual Opportunity
Diversity, and Gender
Equality
Risks
Opportunities
In accordance with its general recruitment policy,
İşbank only recruits for entry-level positions. All
recruitment positions are for recent graduates or
young professionals; executives are trained in-
house. One of the most important risks is the loss
of qualified employees who reached a certain level
of maturity within the Bank for various reasons.
Not being preferred by talented and successful
new graduates and young professionals
Being affected by global labor crises defined as
the “great resignation” and “silent resignation”
due to the changing demands and expectations
of employees and changing work habits and
decreasing employee loyalty
Loss of workforce and reputation due to failure to
meet the expectations of existing and potential
employees
Being the employer of choice for potential
employees with a trusted brand and trusted
employer image
Keeping employee satisfaction high by offering
employees long-term career opportunities through
İşbank’s in-house promotion culture
Being a preferred institution for young employees
thanks to practices in various fields such as
agile business models, artificial intelligence, data
analytics, and comprehensive training programs
Being among the leading institutions of the sector
in terms of diversity and equal opportunity and
being a bank preferred by employees
Keeping employee motivation high by prioritizing a
work-private life balance
Contibuted SDGs
Key Performance Indicators
Employee turnover rate (%)
Number of practices that support employee satisfaction
Participation rate in employee satisfaction surveys (%)
Unionization rate (%)
Satisfaction with the human resources practices score as part
of the working life evaluation survey
Ratio of female employees to the total number of employees
(%)
Ratio of female employees in senior and middle management
(%)(Assistant Manager and above)
Average training hours per employee per year*
Share of digital trainings within all trainings (%)
Hours of training per person in management and leadership
development programs
Hours of training per person in IT competence development
trainings
2019
1.86
18
90
99
67
55
45
25.7✓
30✓
14.2✓
23.4✓
Hours of training per newly recruited employee in their first year
164✓
Number of suggestions communicated by employees
6,292
2020
2021
1.6
15
88
98
71
55
45
2.01
13
85
98
68
55
44
25.4✓
51✓
29.3✓
30✓
2022
1.90✓
16
89
97.5✓
72
55
42.6✓
43✓
25✓
11.4✓
16.7✓
22.1✓
17.6✓
145✓
4,260
26.3✓
36.1✓
116✓
2,950
108✓
4,702
*Training figures exclude participants of refresher trainings, while Private Security Officers and Servant Staff are not included.
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Employee Loyalty
and Satisfaction
İşbank believes that the fundamental basis of business
success is employee loyalty and satisfaction and
considers it a key responsibility to provide a satisfying
work environment for its employees. The Bank has
a deeply-rooted corporate culture and supports
employees with their requirements according to today's
modern world. Thanks to its deep-rooted culture and
a work approach that keeps pace with the times,
employees remain a part of the İşbank family for many
years.
Employee loyalty and satisfaction are regularly
measured through surveys in the Bank. The results of
these surveys, which are conducted in the areas of
training activities, performance management, career
management, recruitment process, remuneration, and
rewarding, aiming to increase employee satisfaction,
are evaluated by managers and enable the necessary
improvements to be made.
In 2022, 90% of the Bank’s employees participated in
the employee loyalty and satisfaction survey conducted
with the support of a consulting firm. In this study, the
employee loyalty rate was measured as 60%.
Practices that support employee satisfaction at İşbank
include online tours and workshops, culture and art
events, special employee discounts obtained from
various organizations, and practices aimed at increasing
employee volunteering support. The running team,
which also included employees of the Bank, attended
marathons for the benefit of different foundations
in 2022 and collected donations for the relevant
foundations with the support of our employees.
The presence of long-term employees is an important
indicator of employee satisfaction and loyalty. 76% of its
employees have been working for İşbank for more than
10 years. As of year-end 2022, the employee turnover
rate was around 1.90%✓, and the voluntary turnover rate
was 3.75%.
Targets
Targets for 2022
Realization in 2022
Target
Realization
Targets for 2023 and Beyond
Continuing to plan role-based
development journeys of newly
established areas as part of the agile
transformation program, designing
training programs that will increase the
level of knowledge and develop the
skills of our employees according to
their competency needs in the newly
established competency lines.
Continuing to offer trainings in the
“Training Catalogue” designed to
support the development of employees
in professional development,
digitalization, personal development
and leadership topics throughout the
year.
Continuing to reach even more
employees with the “Data Analytics
Development Program” launched
in 2021 to support competency
transformation in the field of data
analytics and artificial intelligence.
Completing and launching the “New
Digital Learning Infrastructure” project
designed to increase digital training
hours through innovative learning
practices that offer employees
continuous development opportunities
with highly tailored content through an
artificial intelligence-based suggestion
system and allow employees to access
trainings much more easily through a
learner-driven approach.
Introducing the new learning game,
which was prepared to contribute to
the acquisition of future competencies
by supporting employees’ personal
development and their progress in
technical banking issues, to employees
in 2022.
While role-based trainings designed with the Agile
Management Division continue, Risk Competence
Line and Process Competence Line trainings were
designed in addition to Customer Experience
Competence Line trainings.
While the role-based trainings of
Agile Area employees continue, new
training designs will be made together
with the Agile Management Division in
parallel with changing needs.
A total of 59 topics on professional development,
digitalization, personal development, and leadership
were presented to our employees throughout the
year.
✓⃝
Individual Development Plan trainings
supported by different learning tools to
develop Business Development and
Innovation, Result-Oriented Problem
Solving, Continuous Development,
Customer Centricity, and Human
Relations Management competencies
will be made available to all our
employees at basic, intermediate,
and advanced levels, tailored to the
competencies that our employees
need to develop.
In addition to the phase 1 trainings offered through
the digital training platform within the “Data Analytics
Development Program” and the Applied Statistics
and Applied SQL in Data Analytics trainings in
phase 2, QlikSense Data Visualization training was
implemented, and a seminar on artificial intelligence
was presented to the program participants.
In 2022, about 4,500 employees received a
total of over 51,700 hours of training under the
program. Since the launch of the program in 2021,
a total of 2,241 of our employees have improved
their data literacy skills, gained knowledge on
the fundamentals of data analytics, and received
their Phase I certificates. A total of 1,414 of our
employees participated in Phase II trainings, which
include technical knowledge and application-based
courses designed for employees who want to
further develop themselves in this field.
✓⃝
Data Analytics Development Program
is planned to be continued.
On 05.04.2022, the “New Digital Learning
Infrastructure” project was completed and made
available to our employees.
Our new learning game “İşLegends” was introduced
to our employees on 28.09.2022.
✓⃝
Within 2023, the aim is to continue
to improve our digital learning
platform “Learning World” by adding
new features to improve the user
experience aligned with good practice
examples. In our “İşLegends” learning
game, the aim is to add new mini-
games that support competency
development and to design a
multiplayer structure within the same
learning game.
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Employee Rights
The Future of Business
and New Working Models
İşbank guarantees a work environment where employee
rights are fully respected. All the Bank employees are
free to join trade unions within the scope of freedom
of association and act of their own free will. 97.5%
of the Bank’s employees are union members. The
Remuneration Policy, which is based on the Bank's
internal regulations and the provisions of legal legislation,
especially the Collective Labor Agreement, defines all
economic and social rights of employees. The ultimate
authority and responsibility for ensuring that the Bank’s
remuneration practices are managed effectively within
the framework of the relevant legislation and this
Policy rests with the Bank’s Board of Directors. The
İşbank Remuneration Committee is responsible for the
preparation of decisions regarding remuneration to be
submitted to the Board of Directors for approval, ensuring
the compliance of remuneration with the Bank's risk
appetite, ethical values, internal balances, and strategic
goals, and regularly monitoring the effectiveness of the
Policy.
It is essential that the remuneration of the Bank's
managers and employees at all levels is in line with the
Bank's ethical values, internal balances, and strategic
goals and is not associated with the Bank's performance.
The salaries of senior executives are determined in
accordance with the Bank's strategies, long-term goals
and risk management structure and are designed to
prevent excessive risk taking. The wage package of the
Bank consists of salary, bonus, meals, foreign language
compensation, dividend payment determined by the
Articles of Incorporation, and other fringe payments that
may vary depending on seniority and/or scope of the job.
Payments such as high productivity allowance, product-
based sales bonuses, and executive bonuses may
also be made to employees in line with their individual
performance.
In the coming period, it is planned to establish an
incentive-based remuneration system for the Executive
Board and other senior executives based on specific
performance indicators related to sustainability in line
with the Bank’s strategic priorities.
Manager and manager candidates working in branches
and the Head Office divisions receive premium
payments on an annual basis. Attention is paid to ensure
that the manager premium payments are aligned with
the performance of employees, the Bank's long-term
strategy and the risks assumed. There is no variable
remuneration practice for key employees in the Bank.
In 2022, the “Personalized Goal Setting and Systematic
Bonus” was introduced to cover all employees, and the
target cards consisting of individual and team goals
began to be used to evaluate the success of business
results.
Within the Collective Bargaining Agreement signed
with the Bank-Finance and Insurance Workers Union
(BASİSEN), all employees, regardless of title and seniority,
are eligible for healthcare benefits as per the principles
of the Healthcare Benefit Implementation Regulation,
as well as facilities such as food service and personnel
transportation services, and other benefits and support
packages such as marriage support package, maternity
allowance, child allowance, natural disaster support,
goods transportation allowance and immigration
allowance. Part-time employment of university students
under contracts has started at İşbank, but these
employees cannot benefit from the provisions of the
Collective Labor Agreement due to their individual
contracts.
At İşbank, the principle of freedom of employment
and contract applies. At İşbank, which is among
the organizations with the highest rate of unionized
employees in the sector, there are no activities that pose
a risk of forced labor.
In 2022, online sports workshops were organized
for employees. Relevant videos were shared through
an application that employees can benefit from
continuously.
İşbank supports its employees with practices that go
beyond their fundamental rights and freedoms:
İşbank contributes to the sportive lives of its
employees with the gym located in the Head
Office and TUTOM buildings that is available for all
employees.
The Bank has practices that go beyond the
legislation. Annual leave, maternity leave, disability
and unpaid leave arrangements specified in the
Collective Bargaining Agreement can be expanded
to grant rights in favor of employees beyond the legal
regulations.
There is also the practice of granting administrative
leave by the direct managers upon request of
employees for personal matters. The remote work
practice put in place in connection with the pandemic
means the employees now have more time to deal
with their personal matters.
With the COVID 19 pandemic, the remote working
culture entered business life. Until October 2022, the
Bank tried different working models determined by
prioritizing employee and customer health and closely
monitored the development of many parameters such
as employee loyalty, employee happiness, business
performance, and customer satisfaction. In the reporting
period, when pandemic-related concerns and health
measures were almost over, it was observed that remote
and hybrid working was adopted as a valid, new working
model in the world and in our country. Thus, until the end
of 2023, İşbank employees will continue to work with a
setup of;
Remote working for teams in the fields of technology,
remote service, remote sales, and operations working
at least 2 days a month in the office,
Hybrid working for business units and development
teams,
Full-time office work for teams that need to be in the
office due to the nature of their work.
In addition to Head Office employees, branch employees
can also work remotely in line with the principles to be
determined at the initiative of the branch manager.
In addition to the Head Office premises, modern offices
called MaxiOfis are being opened in different provinces
in line with the “İşim Her Yerde” approach and with the
principle that these jobs can be performed from “An
İşbank Office” at any location where employees are
located, in cases where the work to be done can be
performed independently of the location. Considering
the office usage needs evolving with the new working
model, 8 MaxiOfis locations were opened in Istanbul,
Izmir, Ankara, Adana, Antalya, and Trabzon, which can be
used by all employees whose work is suitable for remote
working, especially remote workers and employees
assigned to different cities.
In office designs, the aim is to create spaces that offer
comfort, flexibility, and new opportunities that increase
employees’ sense of belonging and strengthen
positive interaction in business life with social space
solutions considering community health. Realized with
this vision, MaxiOfis locations are contemporary and
modern workspaces with spacious and next-generation
design, cafés and recreation areas, libraries and private
meeting rooms. These offices are organized according
to the hybrid working setup, with desks and meeting
rooms made available to all İşbank employees by being
included in the booking system. In this way, workspaces
that can be booked and used for different purposes such
as collaborative work, events, meetings, and customer
meetings, when needed, are available to all employees
without space and table ownership and can be used
more effectively and efficiently.
In order to manage human resources effectively
and to provide location-independent access to the
next-generation competencies needed, functions
such as remote service, remote sales, data analytics,
and operations, which the Head Office units want to
expand strategically, were made functional under the
scope of competency lines. With assignments to these
functions, the aim is to increase the welfare and standard
of living of more employees by meeting the demands
of employees who request transfers to different cities.
MaxiOfis locations are being determined by taking
into account the demands and needs of employees.
With this practice, the Bank is able to access the next-
generation competencies it needs regardless of location,
and employees are offered different career alternatives.
Currently, 445 employees are performing their duties in
this context. Also in 2023, the Bank plans to continue
opening new MaxiOfis locations where needed and to
assign employees in Anatolia to these offices within the
scope of the competency lines specified.
With the introduction of remote and hybrid working and
the experience that flexible working models are also
applicable, employees have found the opportunity to
work from different cities within the framework of their
needs. Employees who request it have the opportunity to
work permanently in MaxiOfis locations opened outside
Istanbul if their managers find it appropriate. In this
way, it has been possible to create an alternative to the
increasingly difficult living conditions in Istanbul.
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Agile Workshop
Despite its large corporate structure, İşbank is an
institution with fast decision-making processes. An
important component of this working system is the “agile
areas” established in critical areas. In agile areas where
employees from different functions come together, fast
and innovative solutions are created for critical questions.
With the addition of the 10 Agile Areas in 2022, there are
now a total of 22 Agile Areas, 1,500 employees working
with the agile working model, and 185 Agile Teams.
Within the Agile Academy, a training catalogue and
learning journeys consisting of 23 modules were
designed in a structure that can serve external
companies.
In 2022, within the agile transformation efforts, divisions
with functions such as payment systems and product
development were restructured under the agile working
model in line with İşbank’s strategic goals and started
their activities with a focus on providing more innovative
products and services to our customers. The Agile
Service Unit, which creates value for the customer and
receives business from the same service pool, was put
into practice.
With the Panel, which was commissioned to strengthen
the institutional framework of the agile working model
and to ensure that employees’ Field-Team-Competence
Line-Role information can be monitored instantly through
the system, employee information working in agile
organizations can be monitored and reported instantly
through the system. The new Software Development
Life Cycle, which ensures that all existing processes,
from the planning of a job in agile areas to the period
after it is taken into the production environment, are
carried out in accordance with the agile model, has been
implemented in all areas. In the JIRA application, where
agile teams engaged in software development carry out
business planning, a Single Backlog structure where
business and software needs can be managed through
the same backlog was implemented. In this way, the
software development and release processes of agile
organizations have become more efficient.
The structure required for measuring and evaluating the
innovation rate in the works produced by Agile Teams
has been put into operation. As of 2023, the aim is to take
various actions to increase the innovation rate of Agile
Team work lists through monitoring.
In 2023, it is planned to spread agile values and an agile
mindset in all Head Office Divisions.
The following results
were obtained with the
evaluations made in 2022.
50%
Improvement
in Time to Market 4.26/5
Agile Maturity
4.34/5
Employee Satisfaction
Equal Opportunity, Diversity
and Gender Equality
Our Gender Equality Strategy
İşbank has supported women since its
foundation. By becoming a signatory to the
United Nations Women’s Empowerment
Principles (WEPs) in 2020, the Bank reinforced
this egalitarian approach and committed to
playing a role in supporting and facilitating
women’s participation in employment in
Türkiye. Inclusion in the WEPs has created a
complementary framework for existing efforts.
As an extension of this approach, the Gender
Equality Policy was established in 2021 with
the decision of the Board of Directors. With
the Board’s decision, the Board of Directors
Diversity Policy was put into effect in 2022.
In 2022, a program was established to put
the Bank’s efforts on gender equality into
a structural framework under the Gender
Equality Policy. The aim of this program is to
develop good practices that create impact by
considering all stakeholders in the Bank’s value
chain. For this purpose, a 4-pillar structure was
designed with the dimensions of employees,
suppliers, customers, and society. Working
Groups, which include various business units of
the Bank, continue to work on this topic through
various actions.
To access the Gender Equality Policy,
please click here.
At İşbank, providing equal opportunity to all employees
without discrimination is a material topic. On the basis of
diversity, inclusion, and equal opportunity, discrimination
based on factors such as gender, language, religion,
ethnic origin, and age is not permitted in business
processes. Attaching special importance to ensuring
gender equality, the Bank conducts training and
practices in this regard.
İşbank is a signatory to the Women’s Empowerment
Principles (WEPs), which were launched by the United
Nations Environment Program Finance Initiative and aim to
empower women to take part in economic life in all sectors
and at all levels. The Bank is a corporate member of the
30% Club’s Türkiye Network, an international initiative that
aims to increase the number of women on the boards and
in executive leadership of companies worldwide.
One of the institutions with the highest number of female
employees in Türkiye, 55%✓ of İşbank’s employees and
42.6%✓ of its executives are female.
There are 11 executives on the Bank’s Board of Directors,
1 of whom is a woman. The ratio of female executives
on the Board of Directors is 9.09%. In recruitment,
all candidates are provided with equal employment
opportunities without gender discrimination. Of the job
applicants, 43.58% are female and 56.42% are male.
Of the Bank’s recent graduate employees, 47.07% are
women and 52.93% are men.
At İşbank, which is among the institutions with the
highest number of female employees in Türkiye,
providing equal opportunities to all employees without
discrimination is a corporate priority.
Breakdown of
Employees by Gender*
Male
45%✓
Female
55%✓
Breakdown of
Managers by Gender*
Female
42.6%✓
Male
57.4%✓
*Employees with the title of Private
Security Officer are excluded.
Ratios including Private Security
Officers F: 51%, M: 49%
*Assistant Manager
and higher titles
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İşbank 2022 Integrated Annual Report 123
55%✓
Female employee ratio
42.6%✓
Ratio of female managers
12%
Ratio of female engineers
15.75%
Ratio of female senior
executives
53.29%
Ratio of female employees
hired in 2022
39%
Ratio of female employees
in the top 10% of the Bank’s
highest paid employees
44.59%
Ratio of women in the
lower middle pay quartile
at the Bank
49.77%
Ratio of women in the low
pay quartile at the Banki
50.01%
Ratio of women in the
highest pay quartile at the
Bank
4.85
Average unadjusted
gender pay gap
36.05%
Ratio of women working in
information technology (IT)
55.25%
Ratio of women in the
upper middle pay quartile at
the Bank
99.7%✓
Rate of female employees
returning from maternity
leave
Equal pay for equal work
Career opportunities
The Remuneration Policy covers the employees and managers
of the Bank at all levels and is under the responsibility of the
Remuneration Committee, which directly reports to the Board
of Directors. Remuneration is managed through transparent
and measurable processes and systems, and there is no
gender-based wage differentiation within the remuneration
policy. As of December 2022, regardless of role and
responsibility, the median salary payment to female employees
in the Bank was 9% higher than the median salary paid to
male employees.51
The 2022 “Gender Equality in Remuneration Audit Report”
was submitted to the Audit Committee on 09.02.2023.
The said report concluded that the remuneration of female
and male employees did not differ according to gender in
the conjugate study as of the date of commencement of
employment, the date of the last title change, and the date of
the last level change.
51 In the calculations, monthly regular payments made to employees
working in Türkiye as of November 2022 regardless of their performance
were taken into account. Payments such as overtime pay, cash
compensation, shift compensation and other social benefits and
non-guaranteed payments made once a year were not taken into account.
A joint program was developed with Upschool to increase
the number of competent women to work in technology and
digital activities at İşbank. Only female candidates, who are
the 4th can apply for the program, women who are 4th-year
university students or graduates, are not over 30 years of age
and succeeded in the evaluation process will receive technical
training for 10 weeks and then have the opportunity to work
in the Information Technologies, Data Management, or Head
Office business lines at the Bank.
Awareness for equality
İşbank implements gender equality practices covering all
employees and activities in line with the principles of equal
opportunity and diversity. “Diversity and Inclusion” training
was organized for Head Office and Branch managers. Aiming
to raise awareness on unconscious prejudice, the training,
in which gender equality and tools and methods to reduce
discriminatory behaviors were discussed, was attended by
313 managers in December 2021 and 1,794 managers in
2022. The “Leader Women” Program was launched in 2022
to encourage more active participation of female employees
in management and to support their development on their
way to senior management positions. 123 managers have
participated in the program, which includes classroom
trainings focusing on furthering leadership competencies, as
well as experience-sharing meetings where participants will
come together in small groups periodically throughout the
year under the mentorship of experienced managers. The
program is planned to continue in the future as well.
Within the scope of awareness-creating and consciousness-
raising trainings focused on themes that support İşbank's
sustainability vision and the United Nations Sustainable
Development Goals, the following Management Development
Conferences were organized for managers and manager
candidates: “Sexism Behind Politeness: Culture and
Language”, “Sustainability through the Lens of Gender
Equality”, and “Law Against Violence: Empowerment
through Rights”. In addition, “Better is Possible with Inclusive
Leadership” training in the Branch Managers Training
Catalogue and “Women in Business Life and Inclusive
Leadership” training in the Leader Women Program were
organized. A total of 749 of our employees’ self-awareness on
tacit prejudices was supported through these trainings.
A 2-hour “Diversity and Inclusion” course is provided to new
recruits with the titles of Officer and Assistant Specialist within
the Starting My Career Trainings and to employees promoted
to Senior and Assistant Manager roles in the career training
programs. In this course, tacit prejudice and gender equality
are covered for 1 hour. In the 2-hour training “The Richness
of Differences: Diversity and Inclusion”, which was included
in the Training Catalogue offered to all our employees with
the principle of equal opportunity, a 20-minute section of the
training was on gender equality, and a 40-minute section was
on tacit prejudice, totaling one hour of discussion on these 2
topics, and a total of 1,204 people participated in the related
trainings. In addition, discrimination, prejudices, and gender
inequality topics were conveyed in the 45-minute section of
the 2-hour “Equality in Language and Communication” training
included in the Training Catalogue, and 60 people received this
training. Furthermore, the “Ethical Principles and Operational
Rules” digital training was made available to employees. The
training included detailed information on the Bank’s ethical
principles and operational rules; quality, compliance, and risk
policies; the principles on the Policy for Combating Financial
Crimes and Sanctions and Compliance Program, Compliance
with Competition Law and provision of Information Security;
and information on the “Ethics Hotline” where employees can
report any violations or suspected violations of ethical principles.
The Correct Approach towards Disability and Sign Language
trainings continue to be offered as mandatory trainings.
İşbank always considers gender equality in its marketing and
advertising activities. Women/female farmers play an important
role in the agricultural sector. In order to demonstrate this
importance and appreciation, the Bank evaluates its advertising
and marketing content from this perspective and approaches
the positioning of women, the expressions in texts, the selected
visuals, and scenario flows within this framework. Content
for use in the Bank’s marketing and advertising activities
is prepared with sensitivity against gender discrimination,
reviewed by the relevant teams before publication, and
evaluated in terms of all prejudices and identity distinctions,
including gender. In case some or all of the content is deemed
inappropriate, feedback is provided to the relevant business
units and contracted third-party companies, and business
processes are also developed in this regard. In machine
learning models, care is taken not to use gender information
and information such as “date of maternity leave” that may
lead to gender prediction. There were no complaints of gender
discrimination in marketing and advertising activities.
Support for Women
In cooperation with TÜRKONFED and İşbank and with the
support of UN Women Regional Office for Europe and Central
Asia, the “WeLead (Leading Women Entrepreneurship for
Accelerating Development)” project was launched for women
entrepreneurs. The project aims to improve the capacities of
entrepreneurial women and strengthen their communication
networks. Within the project, training content on financial and
non-financial topics was prepared for entrepreneurial women
regardless of sector and scale.
Within this scope, face-to-face trainings on E-commerce,
Digital Marketing and Global Marketplaces, and Gender
Responsive Procurement were held in Istanbul on June 29,
2022; Introduction to E-Commerce and Sales in Marketplaces
in Trabzon on October 11, 2022; Entrepreneurship and
Introduction to E-Commerce and Sales in Marketplaces in
Antalya on November 16, 2022; and Digital Marketing and
Introduction to E-Commerce and Sales in Marketplaces in
Kayseri on November 29, 2022.
Online trainings were held on August 17, 2022 on Company
Establishment and Taxation, on September 7, 2022 on
Entrepreneurship, on September 28, 2022 on Introduction to
E-Commerce, on October 5, 2022 on E-Accounting, E-Invoice,
on November 3, 2022 on Micro Export, on November 11, 2022
on Trademark, Patent and Design, on December 7, 2022 on
Quality Process Improvement and Process Development, and
on December 15, 2022 on Facebook Ad Panel.
An Entrepreneur Women Meetings event was organized in
Adıyaman on September 20, 2022.
By offering financial and non-financial services to women
entrepreneur customers, the Bank aims to increase the loyalty
of existing customers and acquire new ones. İşbank regularly
monitors the depth score of women entrepreneur customers,
which indicates product penetration and establishment of
profitable relationships, product ownership means in POS and
corporate credit card products, which make a high contribution
to the expansion of the Bank’s demand deposit base, their
total combined shares, and their Commercial NPL ratios. The
Bank has Women Entrepreneur Loan and Eximbank Funded
Women Entrepreneur Export Support Loan Campaigns for
women entrepreneurs.
Family-friendly employer
The family life of its employees is important for İşbank.
Accordingly, the Bank conducts practices that support the
balance between the work and private lives of its employees.
For female employees, pregnancy and the postpartum period
can affect their work life. In order to avoid such disruptions,
İşbank puts in place practices that will facilitate the return of
female employees to work after childbirth. Thanks to these
practices, 99.7%✓ of female employees who took maternity
leave in 2022 returned to work.
The positions of female employees on maternity leave are
preserved, and following the end of their leave, they can
continue their duties in the same position and in the same
location. They can request unpaid maternity leave before
starting work or benefit from part-time work arrangements.
For new mothers, breastfeeding rooms have been allocated
to create a more comfortable working environment after
maternity leave. Employees using breastfeeding breaks can
also benefit from personnel transportation services. Mother
and child benefit from the comprehensive health benefits
offered by the Bank. Children between 36-72 months of
age of female employees working at the Bank’s TUTOM
location can benefit from the Private Tuzla Bilfen Kindergarten
operating at the relevant location. All employees with children
are provided with a maternity and child allowance. Male
employees can take a longer paternity leave than the length of
leave specified in the regulations.
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Compliance with
Operating Principles
Employee Health
and Safety
Preferred
Employer
If, during routine audits conducted by the Board of
Inspectors, suspicion arises that the Bank employees do
not conform to work standards, or if the Board receives a
claim that the operating principles are not complied with, the
issue is meticulously reviewed. If tangible evidence is found
that proves such suspicion or claim, the reports prepared
to allow the necessary administrative decisions to be made
in accordance with the Bank’s collective labor agreement
and the legislation are reviewed by the Board and then
transferred to the related Head Office Divisions for action.
For behaviors that are found to be in violation of the Bank's
policies, the necessary disciplinary action, up to termination
of the employment contract, is taken according to the
Human Resources Regulation and applicable provisions
and procedures of the Collective Labor Agreement.
Where circumstances warrant legal action, the violation is
brought to the attention of legal authorities. Accordingly, 46
investigations were carried out and referred to the related
Head Office Divisions in 2022.
Sexual harassment allegations submitted to the Board of
Inspectors are examined by the Board, and the findings
are transferred to the relevant disciplinary units of the
organization in accordance with the provisions of legal and
internal regulations.
Internal Communication and Employee
Participation
For İşbank, the ideas and suggestions of our employees are
valued. The Bank listens to the employees' suggestions,
complaints and feedback via constant communication
channels and reflects them in its management and decision-
making processes. There are various platforms aimed to
systematically ensure employee participation at İşbank.
As part of the Employee Communication Platforms and
Programs (ÇİPP), trend surveys are conducted among
employees, and they contribute to the planning of new
activities. Innovations such as cultural tours, competitions
and e-sports activities have been introduced via this
platform, and the participation of employees in social
responsibility activities has increased. Thanks to the
hobby and interest groups created through ÇİPP,
employees are given the opportunity to expand their
communication networks within the Bank.
HR Help Desk (Maximo) is a practice where employee
opinions, evaluations, requests and complaints are
received and forwarded to the relevant units.
There are mechanisms based on in-house confidentiality
where employees can report their complaints about the
workplace. Employees can report actual or suspected
violations of İşbank's Ethical Principles and Operational
Rules, the Bank's policies and internal regulations, as
well as national and international legislation via the
Ethics Hotline. It is essential that the reports are kept
confidential; and unless expressly requested, the name
of the reporting person is kept confidential. Employees
are not exposed to any disciplinary action, direct or
indirect retaliation, or put at any disadvantage compared
to their peers for reporting a violation.
Submissions coming through the “Negative News Line”
can only be viewed and directly answered by the CEO.
Thus, employee privacy and confidentiality is protected
at the highest level. In 2022, 761 employees created
812 negative news items, and product and process
improvements were evaluated by the related business
divisions.
The “About Me” platform was created to enable
employees to communicate issues they deem useful to be
known by the Human Resources Function and to support
the Bank's decision-making processes with accurate
and detailed information. The information entered on
the platform can only be viewed by authorized persons
in the Human Resources Management Division and by
the employee themselves, and the confidentiality of the
shared information is essential. Through this platform,
employees can make notifications under the topics “About
My Family”, “About My Health”, “I Have a Complaint”, “I Have
a Wish”, and “About My Career”.
The aim of the “I Have a Suggestion” application is to
create new applications and solutions related to the
banking system together with employees by utilizing
their knowledge and experience, thereby improving and
enhancing the customer experience. Suggestions can be
entered into the system by all our employees, provided
that they bring innovation and benefit to the Bank's
practices and that each suggestion covers a single topic.
Another aim of the application is to develop employees’
creativity and increase their sense of job satisfaction by
making them more participatory. Suggestions entered
by employees are subjected to a preliminary evaluation
by the Corporate Architecture Division according to
their prior presence in the agenda and availability in
practice. Then, if necessary, they are directed to the
relevant Divisions according to the subject matter.
Suggestion owners are provided with responses via the
system within a maximum of 15 days from the date of
suggestion entry. Suggestion owners can monitor the
outcome of their suggestions through the system. At the
end of these processes, suggestion owners are given gift
vouchers from İş Kültür Publications for suggestions that
are deemed favorable and approved for implementation.
Within the reporting period, 3,669 out of 4,702 suggestions
entered were evaluated by the relevant divisions, and 434
were implemented. The remaining 1,033 suggestions are
under evaluation.
Ensuring a healthy and safe work environment for
employees in compliance with international standards is
one of the main responsibility areas of İşbank. The most
authorized person in charge of OHS at İşbank is the Human
Resources Management Division Manager, two reporting
levels lower than the General Manager. In line with the
provisions of the Occupational Health and Safety Law,
OHS Committees where employees are represented are
established in the Bank's buildings having more than 50
employees.
As of year-end 2022, there are 40 OHS Committees
operating at İşbank. The OHS Committees convened 151✓
times during the year, with 361✓ committee members
participating, including 107✓ employee representatives.
Maintaining a healthy and safe work environment is as
important as providing such an environment. And this
is possible if employees have OHS awareness. İşbank
organizes trainings to increase OHS awareness among
employees. In 2022, 49,344 person-hours of OHS training
were provided to 9,454 employees.
İşbank’s Occupational Health and Safety Policy was
approved by the Board of Directors, announced to all
employees, and published on the Bank’s website.
International Award to İşbank in
Occupational Health and Safety
In 2022, İşbank was awarded the “International
Occupational Safety Award”, one of the most
prestigious awards in the world in the field of
occupational health and safety, organized by
the British Safety Council.
In 2022, 49,344 person-
hours of OHS training were
provided to 9,454 employees.
İşbank aims to become the preferred employer for
qualified humancapital. By attracting a potential
workforce, the Bank contributes to the development of
young employees, increases the sustainability and brand
value of the organization, and retains existing employees.
The Bank communicates with potential employees and
university students through various channels in order to
reach potential qualified employees.
Communication with university students takes place
via campus communication, student clubs and
career centers. Employees representing the business
divisions of the Bank share the corporate culture and
their personal experiences with the youth. In-house
technologies and innovation studies are communicated
to the students.
Within the scope of the Master Class Internship Program
and Future Hub programs for students in their last two
years of university education, young people are provided
with the opportunity to get to know the institution closely,
work on joint projects with current employees, and gain
personal and professional development opportunities
through online training.
Depending on the requirements of the position, online
exams and recruitment processes are monitored. Thanks
to online applications, the Bank offers employment
opportunities throughout the country. There are
internship programs for students in their last two years
of university education, which allow young people to
become more familiar with the Bank, observe existing
employees, and benefit from their perspectives.
Besides universities, İşbank also collaborates with
non-governmental organizations. As a result of such
collaborations, various development programs are
undertaken. Through projects carried out jointly with
U2C, Upschool organizations, 1 million jobs program and
the Yenibirlider Association, part-time work opportunities
are offered to university students, and the Future Hub
Development Program is organized for young people.
Within the scope of development programs, university
students are offered mentorship, as well as the right
to benefit from in-house trainings and the opportunity
to participate in art events organized by the Bank and
İş Sanat. This not only helps young people in their
education but also enriches their cultural and personal
development.
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İşbank 2022 Integrated Annual Report 127
Talent
Management
İşbank continuously invests in human capital.
Accordingly, the Bank offers its employees opportunities
to improve their skills throughout their career journeys
and prioritizes the development of future skills as a
strategy. A wide range of training programs and learning
opportunities, personalized with pioneering technologies
and offered in line with the principle of equal opportunity,
contribute to enhancing the competencies of employees.
Supporting the continuous development of employees is
also aligned with İşbank's vision of “being the bank of the
future that creates sustainable value”.
Newly recruited employees participate in "Starting My
Career" training programs, differentiated according to the
specific title and duties of participants, starting from their
first day on the job. Employees can benefit from various
trainings offered in the “Training Catalogue” on their
specific needs and preferences and attend seminars on
different topics offered under the "İş'te Sohbetler" brand.
Within the scope of the Training Catalogue, more than
4,850 of our employees participated in the trainings
held in a total of 59 areas in 2022, including professional
development, digitalization, personal development, and
leadership.
Trainings were held on different subjects by taking into
account the types of branches, roles and the duties
and responsibilities associated with these roles in order
to support field employees with their competency
transformation. The “Sales Academy Phase 3” training
program for individual sales teams and the “Sales
Academy Phase 4” training program designed in 2021
continued, taking into account the next-generation
customer behaviors and expectations. In addition to
the trainings organized for commercial sales teams, the
“Tradespeople, SME and Agriculture Academy”, which
focuses on getting to know tradespeople, SME and
agricultural customers, was launched and offered to
employees in 2 modules.
Within the role-based trainings designed specifically for
the roles in Mixed, Commercial, Corporate, and Private
Banking branches, the number of people who participated
in training in 2022 reached over 28,900 and over 162
thousand hours of training were provided. Trainings
on different subjects were also held to develop sales
competencies and increase the technical knowledge
of direct sales teams, and more than 380 employees in
direct sales teams in personal, commercial and agricultural
segments received over 3 thousand hours of training.
Role-based trainings designed together with the Agile
Management Division continued in order to ensure the
best functioning of the agile model in the Bank, to spread
the agile philosophy and framework, and to support
the adaptation and development of teams. Technical
trainings and competency development programs were
organized to address special agile working principles
according to the needs of Team Member, Product Owner,
Agile Ambassador, Agile Coach, Competency Line
Leader and Area Leader roles.
Among the programs that support employee
development and competency transformation in line
with the competencies of the future, the Data Analytics
Development Program, which focuses on data analytics
competency, continued in 2022 with high demand and
participation. The program is available for use by all
employees, regardless of title and role. It is intended to
help employees understand data, gain new skills related
to working with data, develop data literacy and establish
a data-driven, decision-making culture. In 2022, about
4,500 employees received over 51,700 hours of training
in the program, which starts with basic level training
and continues with applied training on data analysis
techniques and data visualization tools for employees
who want to further develop themselves in this field.
The Digital Academy was designed to develop the
digital competencies of employees in the fields of User
Experience and Digital Marketing with the aim of providing
employees with the competencies that will be needed in
the future today and to ensure competency transformation
within the scope of the future business model and was
presented to employees in the form of learning journeys.
The first 2 modules of the program, each consisting of
5 modules designed with a mixed learning model, were
opened to employees within the year, and a total of
48,289 hours of training were provided within the Digital
Academy. The remaining modules are planned to be
offered to employees in 2023.
At İşbank, management and leadership development
programs consist of technical and competency-based
trainings that are held for managers with different titles
and designed to support the competencies required for
the specific role in question.
Leadership development programs aim to strengthen
the next-generation leadership competencies of
the Bank’s managers and promote a winning culture
and a leadership approach focused on continuous
development. Within the academy programs designed
specifically for business areas such as marketing,
innovation, data science, and artificial intelligence
architecture, 127 employees attended a total of 5,940
hours of training in 2022.
All employees can access various on-demand digital
content such as videos, e-learning, and games, from a
single platform via the “Learning World” digital learning
platform. Infrastructure changes in the “Learning World”
platform were completed, and the new system was made
available to employees. The new “Learning World” has
taken its place as an important reference source in the
development journeys of employees with its artificial
intelligence-supported suggestion engine and more
user-friendly interface, an ever-enriching range of
content, and the addition of different systemic features
in a structure that can support employees’ development
processes more effectively and meet various needs that
will arise in the future. As of the end of 2022, there are
more than 750 contents in the Learning World.
In addition to supporting the development of employees’
professional and personal competencies, the Bank’s
range of learning tools was expanded to contribute
to the acquisition of new competencies in line with
changing needs. A collaboration was realized with the
Neoskola platform, where content prepared by leading
expert trainers is presented with high production quality,
and training videos on 10 topics were made available
to employees. In addition, the Vidobu platform, which
includes learning videos prepared by expert trainers, was
also made available to the Bank’s employees.
Within the “Sustainability Digital Training Series”, which
was prepared to inform employees about the concept
and history of sustainability, why we need to achieve
sustainability and corporate practices within the subject,
“Sustainability - State of the World”, “Sustainability -
History of Sustainability”, and “Sustainability - Business
World and Sustainability” digital trainings were made
available to employees as of the third quarter of 2022.
In the fourth part of the training series, the content
production process of which is ongoing, the efforts
put forward by the finance and banking sector for
sustainability will be conveyed, and it is aimed to be
made available in the first quarter of 2023. The digital
training of the same name, which was prepared to
increase awareness of sustainable development goals
and to inform employees about the Bank's work within
the scope of Sustainable Development Goals, was
presented to employees in December 2022.
products and applications. The program consists of more
than 40 short videos, including the “Renewable Energy
Mixed Fund”, “Electric Vehicles Mixed Fund”, and “Gold
Fund”, which are managed with the expertise of İş Portföy
A.Ş., a subsidiary of İşbank, and offered to customers.
Work was completed on the preparation of a new
learning game to raise employees’ awareness of the
Bank’s strategic goals, support them in acquiring future
competencies in line with future banking and evolving
business needs based on it, and to contribute to their
knowledge of the Bank’s vision, mission, and values. The
İşLegends learning game, which is a next-generation
continuation of the Bank’s learning game culture that
started with İşVille and İşGame, centered on competency
development, was made available to employees on
28.09.2022. 3,385 employees participated in İşLegends,
and over 900 thousand questions were answered.
Performance and Learning Culture
İşbank executives are trained from within the Bank.
This means that employees are also the executives
of the future. All employees have the opportunity to
be promoted to managerial positions in line with their
performance. Therefore, the Performance Management
System plays a key role in İşbank's human resources
practices. With the performance evaluation process,
employees can take the necessary steps regarding their
career development. In 2022, performance feedback
was provided to 21,466 employees.
Assessment Center Practices
The Transition to Management Assessment Center
Application, an additional decision support mechanism,
was designed so that the transition to the management
career stage of employees of certain title groups
at İşbank is based on more objective and concrete
criteria. This mechanism was designed in a structure
that will demonstrate whether the employees have
the competencies that are considered critical for high
performance in the target position for which they are
candidates at the expected level and whether they
are suitable for the relevant position, enabling the right
employees to be promoted.
The “Mutual Fund Recommendations” digital training
program was created to inform employees about new
A total of 596 employees were included in the assessment
between June 13, 2022 and September 27, 2022.
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 04
Good Corporate
Citizen
130 Transparent and Ethical Management
184 Contribution to Social Welfare
130 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 131
Transparent and
Ethical Management
An important component of İşbank’s pioneering position in the sector is its
ethical and principled banking approach, which is also the foundation of the
Bank’s reputation. Preparing to celebrate its 100th year, İşbank is identified with trust and
reputation in the banking sector. İşbank’s management approach is based on its deep-rooted
history, complies with international standards, and aims to create value for all stakeholders.
Risks
Opportunities
Penal sanctions due to non-compliance with rapidly
changing and increasing legal regulations
Being out of the competition as a result of the top
management’s knowledge and experience level
not keeping pace with the changing economic
conjuncture
Risk of loss of trust with stakeholders and dismissal
from relevant engagements due to failure to meet
reporting and information sharing requirements
Increasing the interest of investors and customers
with an excellent reputation and brand value
Becoming an international financial institution by
being included in various indices as a result of
corporate compliance efforts
Contributing to reputation management with
transparent information sharing, gaining a competitive
advantage in different performance areas
Contributed SDGs
Related Capital
Elements
Material Topics
ᲁBusiness Ethics
Transparency
Corporate
Management and
Reporting
ᲁEfficient Risk
Management
Relevant Stakeholders
ᲁShareholders
ᲁInvestors
ᲁEmployees
ᲁCustomers
Key Performance Indicators
2019
2020
2021
2022
Number of employees
receiving Anti-Bribery and
Anti-Corruption Training
7,577
7,830
5,716
17,015**✓
Total hours of Anti-Bribery and
Anti-Corruption Training
3,115✓
857✓
627✓
2,130✓
Risk Management
Number of times
the Risk Committee
convened: 12
Conducting loss event
data analysis
Completion of
scenario analysis
Conducting impact-
probability analysis
Conducting
Top-Down Risk
Assessment
Number of times
the Risk Committee
convened: 12
Number of times
the Risk Committee
convened: 11
Number of times
the Operational Risk
Committee convened:
1
Number of times
the Operational Risk
Committee convened:
2
Conducting loss event
data analysis
Conducting loss event
data analysis
Completion of
scenario analysis
Completion of
scenario analysis
Conducting impact-
probability analysis
Conducting impact-
probability analysis
Conducting
Top-Down Risk
Assessment
Conducting
Top-Down Risk
Assessment
Number of times
the Risk Committee
convened: 11
Number of times
the Operational Risk
Committee convened:
2
Conducting loss event
data analysis
Completion of
scenario analysis
Conducting impact-
probability analysis
Conducting
Top-Down Risk
Assessment
Audits carried out by the Board of Inspectors
Number of domestic
branch audits
Number of foreign branch
audits
Number of subsidiary
audits
Number of Head Office
division audits
Publishing of Integrated
Annual Report
Number of social media
followers (million)
Developing cooperation with
national and international
initiatives
Fulfilling UNEP FI Principles
for Responsible Banking
commitments
Fulfillment of NZBA
commitments
245
2
7
14
-
2.6
186
4
10
12
-
2.7
175
2
10
24
79*
3
8
20
Completed
Completed
2.6
2.7
See. Initiatives Supported in the Field of Sustainability
See. Initiatives Supported in the Field of Sustainability
See. Initiatives Supported in the Field of Sustainability
*The number of branch audits decreased as the number of central audits and regional audits increased.
**The main reason for the increase in the “Number of People” is the digital training “Policy for Combating Financial Crimes and Sanctions and Compliance Program”, the
content of which was renewed and assigned to all employees as legal compliance training in November 2021.
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İşbank 2022 Integrated Annual Report 133
Targets
Targets for 2022
Realization in 2022
Realization
Targets for 2023 and Beyond
Developing the risk management
skills of employees to spread
the effective risk management
approach to the entire Bank and
spreading the “Risk Culture in
Our Bank” digital training, which
was given to increase their
awareness on the subject.
Completing the impact analysis
studies of the Bank’s portfolio in
line with the UNEP FI Principles
for Responsible Banking by
2024 and contributing to the
studies towards sustainable
development and global climate
goals in line with the targets.
Within the scope of the NZBA
commitment, decarbonizing the
loan portfolio
Reminder e-mails and various
communication activities were carried out
to ensure that employees completed the
“Risk Culture in Our Bank” digital training
in 2022. By the end of 2022, the number
of employees who completed the training
exceeded 14,500.
✓⃝
A “Loan and Risk Management
Academy” will be established
in 2023 to increase the level of
knowledge of our employees
who are planning to work in the
risk management area of our
Bank’s lending processes and
to contribute to their inclusion
processes.
The Bank is still continuing its activities.
Maintaining the current target
The Bank is still continuing its activities.
Managing the impacts arising
from the Bank’s loan portfolio
and setting reduction targets
Management Structure
Consisting of 11 members, one of whom is
a woman, İşbank’s Board of Directors is the
highest management body responsible for
steering the Bank’s strategy.
Having 3 independent52 members, the Board of Directors
is composed of non-executive members, except for the
CEO. The CEO and Chairperson of the Board of Directors
roles at the Bank are assumed by different persons. The
Board of Directors has several governance committees
in place to support the activities of the Board in various
areas. Responsible for implementing the strategies
established by the Board of Directors and led by the
CEO, the Executive Committee has 14 members other
than CEO, including 3 women.
Members of İşbank’s Board of Directors are responsible
to the Bank and its shareholders while fulfilling their
duties. By accepting membership to the Board of
Directors, the members accept and declare that they
are responsible to the Bank and its shareholders. The
members are obliged to fulfill their duties within the
framework of the authorities and responsibilities set forth
in the legislation and the Articles of Incorporation and to
comply with the principles and procedures set forth in
the Bank’s “Directive on the Operation Procedures and
Principles of the Board of Directors”.
The Board of Directors of İşbank consists of 7-11
members, one of whom is the CEO, as set forth in the
Articles of Incorporation. Members other than the
CEO are elected by the Bank’s General Assembly for
a maximum term of three years. Members whose term
of office expires may be re-elected. The number and
qualifications of the independent Board members are
52 As per the II-17.1 Corporate Governance Communiqué published on
03.01.2014, the members of the board of directors who are assigned as
members of the audit committee, as part of the organization of the board
of directors of banks, are considered as independent members of the
board of directors.
determined in accordance with the regulations of the
Capital Markets Law on corporate governance. There
is no practice of subjecting a certain proportion of the
Board members to rotation at the General Assembly.
Candidates who have the qualifications specified in the
legislation are elected by the Board of Directors for the
vacancies due to death, resignation, or other unforeseen
reasons, and these members are submitted for approval
at the first General Assembly meeting to be held. The
members elected in this manner serve until the first
meeting of the General Assembly, and if their election
is approved by the General Assembly, they continue to
serve for the remaining term of the member they are
elected to replace.
In the event that there is a conflict of interest regarding
one of the items on the agenda of the İşbank Board
of Directors, the Chairperson, Vice Chairperson and
Members may not preside over the meeting and may
not participate in the discussion of the agenda items in
which there is a conflict of interest.
İşbank’s General Assembly has a structure that allows
shareholders to present their opinions and suggestions.
Shareholders or other interested parties who wish to
speak on the agenda item under discussion notify the
chairperson of the meeting. The chairperson announces
the persons who will take the floor to the general
assembly and gives the floor to these persons according
to the order of application. Pursuant to Article 1527 of
the Law, the procedures and principles set forth in the
said article and sub-regulations are applied with respect
to the submission of opinions and suggestions of the
shareholders or their representatives participating in the
general assembly meeting electronically.
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İşbank 2022 Integrated Annual Report 135
Board Member Matrix*
Age and Average Tenure
Independence
Policy: To become a Board Member the person has to have the capacity to
exercise civil rights and possess the qualifications stipulated in the relevant
legislation. There is no maximum age specified. The Board Member is elected
at least every three years by the General Assembly and the members can
be re-elected. If a vacancy in membership during the interim period occurs
due to any reasons, the Board of Directors elects a member to complete the
remaining term of its predecessor office and submits to the approval of the
first General Assembly to be held.
Distribution of Experience of
Non-Executive Board Members
Distribution of Experience of
Executive Board Members
Policy: As per the 1-17.1 Corporate Governance Communiqué published
on 03.01.2014, the members of the Board of Directors who are assigned as
members of the Audit Committee, as part of the organization of the Board
of Directors of banks, are considered as independent members of the Board
of Directors. Ahmet Gökhan Sungur is Independent Member of the Board
of Directors, Yusuf Ziya Toprak and Ersin Önder Ciftçioğlu are Independent
Members of the Board of Directors since they are also members of the Audit
Committee.
73%
27%
0-5
years
7
5-10
years
3
>10
years
-
0-5
years
1
5-10
years
3
>10
years
-
Average age of non-executive
members: 65.2
Average tenure of non-
executive members: 3.7 years
Average age of executive
members: 55
Average tenure of executive
members: 2 years
Non-Independent
Independent
8
3
Educational Background and
Gender Diversity
Educational Background
Post Graduate
University
(4-year college)
55%
45%
Gender Diversity
91%
18%
82%
9%
2021
2022
Female
Male
Skills
Independent
Auditing and / or
Corporate Finance
Banking / Investment
/ Insurance / Pension /
Stock Exchange / FOREX
Technological Skill /
Digitalization and
Information Technologies
(Cybersecurity)
Acquisition and M&A and
/ or Capital Markets
Public Policies
Environmental / Social
Entrepreneurship /
Innovation
Communication /
Marketing / Customer
Services
International
Adnan
Bali
Yusuf Ziya
Toprak
Hakan
Aran
Feray
Demir
Ersin Önder
Çiftçioğlu
Fazlı
Bulut
Durmuş
Öztek
Recep Hakan
Özyıldız
Mustafa
Rıdvan Selçuk
Ahmet
Gökhan Sungur
Sadrettin
Yurtsever
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
✓⃝●
*Prepared based on Glass Lewis Board Skills Matrix.
Number of Board Members and
their Term of Office
Policy: Our Board of Directors consists of 11 members, including the CEO,
who is the natural member of the board. Except for the CEO, 10 Board
Members are elected at least every three years by the General Assembly
and the members can be re-elected. To become a Board Member the
person has to have the capacity to exercise civil rights and possess the
qualifications stipulated in the relevant legislation.
Number of Board Members
11
11
11
11
11
2018
2019
2020
2021
2022
Change in the Board of
Directors within the last 5 years
9 members were appointed, term of office of
2 members is about to expire, new members
have been elected.
Board Member
Adnan Bali
Yusuf Ziya Toprak
Hakan Aran
Feray Demir
Ersin Önder Çiftçioğlu
Fazlı Bulut
Durmuş Öztek
Recep Hakan Özyıldız
Mustafa Rıdvan Selçuk
Ahmet Gökhan Sungur
Sadrettin Yurtsever
Number of Board Meetings
Not Attended
0
1
0
0
0
0
0
0
0
0
0
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İşbank 2022 Integrated Annual Report 137
Board of Directors
Adnan Bali
Chairperson
Yusuf Ziya Toprak
Vice Chairperson
Hakan Aran
Member of the Board and Chief Executive Officer
Feray Demir
Board Member
Ersin Önder Çiftçioğlu
Board Member
Fazlı Bulut
Board Member
Mr. Adnan Bali was born in İslahiye
in 1962 and graduated from Middle
East Technical University, Faculty
of Economics and Administrative
Sciences, Department of Economics.
He joined İşbank as Assistant
Inspector on the Board of Inspectors in
1986. He became Assistant Manager
in the Treasury Division in 1994 and
served as a Unit Manager in the same
division in 1997. He was appointed as
Head of the Treasury Division in 1998.
Mr. Bali served as the Manager of the
Şişli Branch in 2002 and Manager of
the Galata Branch in 2004; he was
appointed Deputy Chief Executive on
30 May 2006 and Chief Executive
Officer of İşbank on 01 April 2011.
Apart from his role in the Bank, Mr. Bali
is also the Chairperson of Türkiye Sınai
Kalkınma Bankası A.Ş. and Softtech
Ventures Teknoloji A.Ş., and the
Chairperson of the İşbank Members’
Supplementary Pension Fund.
Elected to İşbank's Board of Directors
on 31 March 2021 and Chairperson
of the Board of Directors on 01 April
2021, Mr. Bali has also been serving as
the Chairperson of the Remuneration
Committee, Risk Committee,
Sustainability Committee and Board
of Directors Operating Principles
Committee and as a member of the
Credit Committee.
Mr. Yusuf Ziya Toprak was born in
Trabzon in 1943 and graduated from
Istanbul Economics and Commercial
Sciences Academy, Department of
Finance. Mr. Toprak started to work as
an Assistant Inspector on the Board
of Inspectors at İşbank in 1967. In the
following years, he served as Assistant
Manager and Group Manager in
the Automation and Organization
Divisions, as Manager in the Securities
Division, and General Manager at
Yatırım Finansman Securities. He was
appointed as Deputy Chief Executive
at İşbank in 1999.
Mr. Toprak, who retired in 2004,
continued serving as the Vice
Chairperson and a Member of the
Board of Directors at Şişecam until
2010.
Mr. Yusuf Ziya Toprak, who was elected
as a member of İşbank’s Board of
Directors on 31 March 2020 and as
the Vice Chairperson of the Board
on 1 April 2020, also serves as the
Chairperson of the Audit Committee,
T.R.N.C. Internal Systems Committee
and Operational Risk Committee, a
member of the Risk Committee, and
an alternate member of the Credit
Committee.
Born in Antakya in 1968, Hakan
Aran graduated from the Faculty of
Engineering, Computer Engineering
Department of Middle East Technical
University. He completed his master's
degree in Business Administration at
Başkent University and is currently
continuing his PhD in Banking at
Istanbul Commerce University.
Beginning his career at İşbank as a
Software Specialist in 1990, Mr. Aran
was appointed as the Head of the
Software Development Division in
2005. He was promoted to the position
of Deputy Chief Executive responsible
for operations, digital banking and
technology in 2008 and took part in
important transformation programs of
the Bank.
Appointed as İşbank's 17th Chief
Executive Officer on 1 April 2021, Mr.
Aran also serves as the Chairperson
of the Credit Committee, Human
Resources Committee, Information
Technology Strategy Committee and
Information Security Committee and as
a member of the Risk Committee and
Operational Risk Committee.
In addition to his duties at the Bank,
Mr. Aran serves as the Chairperson of
Trakya Yatırım Holding A.Ş. and İşbank
AG.
Mr. Ersin Önder Çiftçioğlu was born
in Ankara in 1960 and graduated
from Hacettepe University, Faculty of
Social and Administrative Sciences,
Department of English Linguistics. Mr.
Çiftçioğlu began his career at İşbank
as an Officer in the Yenişehir/Ankara
Branch in 1985, and was appointed as
Assistant Section Head, Section Head,
Sub-Manager and Assistant Manager
in the same branch. In 2007, he was
appointed as Assistant Manager at
the Başkent/Ankara Corporate Branch
and Regional Manager of the SME
Loans Underwriting Division of the
Adana Region in the same year and
subsequently served as Ankara Center
I. Region Manager in 2008. He was
appointed as the Ege/Izmir Corporate
Branch Manager in 2011 and Başkent/
Ankara Corporate Branch in 2016.
Mr. Çiftçioğlu, who was elected to
İşbank’s Board of Directors on 31
March 2017 and 31 March 2020,
also serves as the chairperson of the
Corporate Governance Committee
and a member of the Audit Committee,
TRNC Internal Systems Committee,
Sustainability Committee, Operational
Risk Committee and Risk Committee.
Born in Ağrı in 1968. Ms. Feray
Demir graduated from Anadolu
University, Faculty of Economics and
Administrative Sciences, Department
of Business Administration and Istanbul
University, Faculty of Open and Distance
Education, Department of Sociology.
She started her professional career
as an Officer at the Sefaköy/Istanbul
Branch in 1988. She was appointed as
Assistant Section Head in 1990, Section
Head in 1995, Sub-Manager in 1996
and as Assistant Manager in 1999 at
the same branch. She then served in
the same position in the Commercial
Loans Division and Corporate Marketing
Division at the Head Office. She was
appointed as Branch Manager to the
Çarşı-Güneşli/Istanbul Branch in 2005,
and then served as Head of Commercial
Banking Sales Division from 2007 to
2011. She served as Branch Manager of
the Istanbul Corporate Branch from 2011
to 2016.
In addition to her duties at the Bank,
Ms. Demir also serves as a member
of the Board of İşbank Members'
Supplementary Pension Fund.
Ms. Demir, who was elected to İşbank's
Board of Directors on 25 March 2016,
31 March 2017 and 31 March 2020, also
serves as a member of the Corporate
Social Responsibility Committee, Credit
Committee, Remuneration Committee,
Sustainability Committee, Corporate
Governance Committee and Board of
Directors Operating Principles Committee.
Mr. Fazlı Bulut was born in Pertek in
1964 and graduated from Ankara
University, Faculty of Political Science,
Department of Economics. He
completed his master’s degree in
Economic Development at New
Hampshire College in the USA.
Mr. Bulut served as Account Expert and
Senior Account Expert at the Ministry
of Finance on the Board of Account
Experts from 1985 to 1997. He taught
General Accounting at the College
of Tourism and College of Computer
Technology at Bilkent University from
1996 to 1998. Mr. Bulut served as Vice
General Manager and Member of the
Board of the Social Insurance Institution
from 1997 to 1999. He served as Vice
General Manager, General Manager
and Member of the Board of Directors
in Tepe Home Mobilya ve Dekorasyon
Ürünleri San. Tic. A.Ş., a subsidiary of
Bilkent Holding, from 1999 to 2011. He
subsequently served as a consultant
for Bilkent Holding on tax and retailing
from 2011 to 2012, as the General
Manager of B. Braun Kalyon Medikal ve
Dış Ticaret A.Ş. from 2013 to 2015, and
as the Coordinator of Financial Affairs
in Terra İnşaat Grubu from 2016 to 2017.
Mr. Bulut has also published books
on various subjects. Mr. Bulut, who
was elected to the İşbank Board of
Directors on 29 March 2019 and 31
March 2020, also serves as a member
of the Corporate Social Responsibility
Committee and an alternate member of
the Credit Committee.
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İşbank 2022 Integrated Annual Report 139
Durmuş Öztek
Board Member
Recep Hakan Özyıldız
Board Member
Mustafa Rıdvan Selçuk
Board Member
Ahmet Gökhan Sungur
Board Member
Sadrettin Yurtsever
Board Member
Mr. Durmuş Öztek was born in Sivas,
Şarkışla in 1953 and graduated from
Ankara University Faculty of Political
Sciences, Department of Economics
and Finance. He completed his
master’s degree in Economics at
Vanderbilt University in the USA.
Mr. Öztek served as a Finance Auditor
between 1975-1986 in the Ministry
of Finance. In the following years,
he served as Division Head, Deputy
General Manager and General
Manager in the General Directorate of
Budget and Financial Control; Chief
Auditor and Member of the Financial
Advisory Committee in the Ministry
of Finance; Auditor in Turk Telekom,
Member of the General Committee
in the Council of Higher Education,
and Financial Counselor in the Turkish
Embassy in Brussels. He served as a
Ministry Counselor in the Ministry of
Finance between 2006-2011.
Mr. Öztek, who was elected to the
İşbank Board of Directors on 31
March 2020, serves as a member of
the Corporate Social Responsibility
Committee and the Board of Directors
Operating Principles Committee.
Mr. Recep Hakan Özyıldız was born
in Bursa in 1956 and graduated from
Ankara University Faculty of Political
Sciences, Department of Economics
and Finance. He completed his
master’s degree in Economics at
Northeastern University in the USA.
Mr. Özyıldız started to work at the
Ministry of Treasury and Finance as an
Assistant Treasury Specialist in 1978.
In the following years, he served as
Branch Manager at the Undersecretary
of Treasury and Foreign Trade and
the General Directorate of Banking
and Foreign Exchange; Division Head,
Deputy General Manager and General
Manager at the General Directorate
of Public Finance under the Ministry
of Treasury and Finance; Auditor
at İşbank, General Manager of the
State Economic Enterprises in the
Treasury, Senior Advisor of Economics
in the Turkish Embassy in London,
and Assistant Undersecretary in the
Ministry of Treasury and Finance.
Mr Özyıldız, who is also a columnist
and commentator, continues to serve
as a part-time academic tutor in
Ankara University, Faculty of Political
Sciences.
Mr. Özyıldız was elected to the İşbank
Board of Directors on 31 March 2020.
Mr. Mustafa Rıdvan Selçuk was born in
Malatya in 1955, and graduated from
Ankara University, Faculty of Political
Sciences, Department of Economics
and Finance. He received his master’s
degree in Economics from Vanderbilt
University in the USA.
Mr. Selçuk started his career in the
Ministry of Finance in 1978 as an
Assistant Account Expert. In the
following years, he served as Account
Expert, Senior Account Expert, Division
Head in the General Directorate of
Revenues, General Manager and
Chairperson of Bağkur in the Ministry
of Labor and Social Security, Labor
and Social Security Advisor in the
Turkish Embassy in Copenhagen and
as Ministry Advisor in the Ministry of
Finance.
Mr. Selçuk, who has also served as
a Certified Public Accountant since
2003, is an Independent Auditor at
BDD Bağımsız Denetim ve Danışmanlık
A.Ş., and a partner at Girişim YMM
Limited Şti.
Mr. Selçuk was elected to the İşbank
Board of Directors on 31 March 2020.
Mr. Ahmet Gökhan Sungur was born
in Yozgat in 1953. He graduated from
Middle East Technical University,
Department of Chemical Engineering
and received his master’s degree from
the same department. Mr. Sungur,
who started his career in 1975 at the
General Institute of Mineral Research
and Exploration, Department of
Technology, as Chief Specialist
Chemical Engineer, worked in
Hisarbank and Güntekin İnşaat A.Ş. as
a System Analyst between 1981-1982.
Later, between 1982-1999, he served
as Manager of Software Development
at İşbank and Chief Executive Officer
at İş Net A.Ş. between 1999-2003.
Mr. Sungur was elected as an
Independent Member of the İşbank
Board of Directors on 31 March 2020.
Mr. Sadrettin Yurtsever was born in
Bingöl in 1964 and graduated from
Gazi University, Faculty of Education,
Department of English Language
Education. Mr. Yurtsever, who started
his career at İşbank as a candidate
officer in the İzmir Branch in 1993,
served in the same branch as Section
Head and Sub-Manager. He served
as Assistant Manager in the SME
Loans Underwriting Division of the
Denizli Region in 2006, İzmir Central
II. Region Sales Division Assistant
Regional Manager in 2007, Regional
Manager in the same division in 2011,
Branch Manager of the Bornova/İzmir
Commercial Branch in 2013 and the
Mediterranean/Antalya Corporate
Branch in 2018.
Mr. Yurtsever, who was elected to the
İşbank Board of Directors on 31 March
2020, also serves as a member of the
Corporate Governance Committee and
the Corporate Social Responsibility
Committee.
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İşbank 2022 Integrated Annual Report 141
Executive Board
N. Burak Seyrek was born in 1970 in Ankara. In
1990, Mr. Seyrek graduated from Ankara University,
Faculty of Political Sciences, Department of
International Relations and started working as
an Assistant Specialist in the Training Division of
Türkiye İş Bankası A.Ş. in the same year. In 1993,
Mr. Seyrek became an Assistant Specialist at the
1st Loans Division, and was appointed as Loan
Specialist at İşbank GmbH Frankfurt, a subsidiary
of İşbank, in 1994, as Assistant Manager in 1996,
and as Assistant Manager at Başkent Branch in
2001. In 2004, Mr. Seyrek was appointed as Ostim
Branch Manager, in 2007 as Ankara Center 2nd
Regional Manager, in 2010 as Commercial Banking
Product Manager, in 2011 as Commercial Banking
Sales Manager, and in 2013 as SME and Enterprise
Banking Sales Manager.
On 1 October 2013, Nevzat Burak Seyrek was
appointed Chief Executive Officer of İşbank AG
and on 25 March 2016, he was promoted to
Deputy Chief Executive of Türkiye İş Bankası A.Ş.
Nevzat Burak Seyrek holds the title of Cambist and
speaks German.
Born in Ankara in 1971. Ms. Gamze Yalçın
graduated from the Economics Department
of Middle East Technical University, Faculty of
Economics and Administrative Sciences.
She also holds a master’s degree in International
Banking and Finance from the University of
Birmingham in the UK. She attended the Advanced
Management Program at Harvard Business School
in 2017. She joined the Organization Division at
İşbank as an Assistant Specialist in 1993 and
served in different units of İşbank. Ms. Yalçın
was appointed as Deputy Chief Executive on 28
November 2017. Ms. Yalçın also serves as İşbank’s
Sustainability Leader.
Born in Adana in 1974. Mr. Ozan Gürsoy
graduated from Middle East Technical University,
Faculty of Economic and Administrative Sciences,
Department of Public Administration and
completed his master’s degree in International
Banking and Finance at the University of
Birmingham in 2003. In 1996, Mr. Gürsoy
joined İşbank’s Board of Inspectors as a Trainee
Assistant Inspector, became Assistant Manager
in the Corporate Loans Underwriting Division in
2006, and then served as Unit Manager at the
same division.
Mr. Gürsoy became Commercial Banking Product
Division Manager in 2011, Gebze Corporate Branch
Manager in 2015, and was promoted to Deputy
Chief Executive in May 2020. Mr. Gürsoy holds the
title of Cambist and Financial Analyst and speaks
English.
Born in Antakya in 1968, Hakan Aran
graduated from the Faculty of Engineering,
Computer Engineering Department of Middle East
Technical University. He completed his master's
degree in Business Administration at Başkent
University and is currently continuing his PhD in
Banking at Istanbul Commerce University.
Beginning his career at İşbank as a Software
Specialist in 1990, Mr. Aran was appointed as the
Head of the Software Development Division in
2005. He was promoted to the position of Deputy
Chief Executive responsible for operations, digital
banking and technology in 2008 and took part
in important transformation programs of the
Bank. Appointed as İşbank's 17th Chief Executive
Officer on 1 April 2021, Mr. Aran also serves as
the Chairperson of the Credit Committee, Human
Resources Committee and Information Technology
Strategy Committee and as a member of the Risk
Committee and Operational Risk Committee.
Born in Ankara in 1971. Ms. Ebru Özşuca
graduated from the Economics Department
of Middle East Technical University, Faculty of
Economics and Administrative Sciences. She
also holds a master’s degree from the Economics
Department of the Graduate School of Social
Sciences at Middle East Technical University and
completed her master’s in International Banking
and Finance from the University of Southampton
in the UK in 1998. She attended the Advanced
Management Program at Harvard Business
School in 2015. She joined İşbank as an Assistant
Specialist at the Treasury Division in 1993. Ms.
Özşuca served in different units of İşbank and
was appointed as Deputy Chief Executive on 28
November 2017.
Born in Ankara in 1967. Mr. Cahit Çınar
graduated from the International Relations
Department of Ankara University, Faculty of
Political Science. He attended Munich Ludwig-
Maximillians University between 1989-1990.
He began his career at İşbank as an Assistant
Specialist in the Economic Research Division in
1991 and joined the Board of Inspectors as an
Assistant Inspector in 1992. He served in different
units of İşbank and the Güneşli Corporate Branch
and served as Chief Executive Officer at İşbank
AG, a subsidiary of İşbank located in Germany. Mr.
Çınar was appointed as Deputy Chief Executive of
İşbank on 5 October 2018.
Born in Kırcaali in 1975. Mr. Sezgin Yılmaz
graduated from Uludağ University, Faculty
of Economic and Administrative Sciences,
Department of Economics. Mr. Yılmaz started
his career as an Officer at Bursa Branch in 1997.
After serving in various positions in the Bank,
Mr. Yılmaz was appointed as Regional Manager
of SME Loans Underwriting Division in Kayseri
in 2012 and Regional Manager of SME Loans
Underwriting Division in İzmir Central I. Region in
2015. He then served as Regional Sales Manager
of SME and Enterprise Banking Sales Division in
İzmir Central II. Region in 2016. Support Services
and Procurement Division Head in 2017, and
Procurement Division Head in the respective order
in 2018. Mr. Yılmaz, who was elected to İşbank
Board of Directors on 29 March 2019 Mr. Yılmaz
was appointed as Deputy Chief Executive of
İşbank on 29 July 2020.
Hakan Aran
Chief Executive Officer
Sabri Gökmenler
Deputy Chief Executive
Sezgin Lüle
Deputy Chief Executive
N. Burak Seyrek
Deputy Chief Executive
Ebru Özşuca
Deputy Chief Executive
Can Yücel
Deputy Chief Executive
Sezai Sevgin
Deputy Chief Executive
Gamze Yalçın
Deputy Chief Executive
H. Cahit Çınar
Deputy Chief Executive
İzlem Erdem
Deputy Chief Executive
Suat E. Sözen
Deputy Chief Executive
Sezgin Yılmaz
Genel Müdür Yardımcısı
Ozan Gürsoy
Deputy Chief Executive
Sezgin Yılmaz
Deputy Chief Executive
Tufan Kurbanoğlu
Deputy Chief Executive
Mehmet Celayir
Deputy Chief Executive
Mr. Sezgin Lüle has been serving as Deputy
Chief Executive responsible for Digital Banking,
Payment Systems, and Customer Experience
at İşbank since January 2021. Mr. Lüle started
his career at İşbank as an Organization
Method Specialist and held various positions
in the Inspection Board, Accounting, Change
Management, and Corporate Architecture
Divisions, respectively. He has experience in project
portfolio management, Business Architecture,
Process Automation, and Organizational
Transformation.
Born in 1976 in Trabzon, Mr. Lüle graduated from
Boğaziçi University, Department of Industrial
Engineering. In 2004, he graduated from the
University of Birmingham MBA IBF program and
completed the HBS AMP program in 2019.
Born in Istanbul in 1968. Mr. Sezai Sevgin
graduated from Marmara University, Faculty of
Economic and Administrative Sciences. On 31
July 1990, he began his career at İşbank as an
Assistant Inspector on the Board of Inspectors.
He became the Branch Manager at İşbank
AG Succursale de Paris on 28 May 1998. He
was appointed as the Group Manager of the
Corporate Banking Marketing Division on 2 July
2004, and Head of the SME and Commercial
Banking Marketing Division on 28 March 2007.
He became the Branch Manager of the Gebze
Corporate Branch on 13 April 2011 and Maslak
Corporate/Istanbul Branch on 28 February 2013.
He was appointed as the General Manager of
Bayek Healthcare Group, a İşbank subsidiary, on
29 December 2015. Mr. Sevgin was appointed
as Deputy Chief Executive of İşbank on 28
December 2021.
Born in 1970, Mr. Suat E. Sözen graduated
from Gazi University, Department of Economics
in 1991. In the same year, he started working as
an Assistant Specialist at İşbank. After working in
various Head Office Divisions and Branches, he
became Corporate Communications Manager
in 2008. In 2017, Mr. Sözen became Corporate
Communications Coordinator and Secretary
General and was appointed Deputy Chief
Executive on 25 March 2022.
Born in Kars in 1971, Mr. Tufan Kurbanoğlu
graduated from the Public Administration
Department of Middle East Technical University,
Faculty of Economic and Administrative Sciences.
In 1993, Mr. Kurbanoğlu joined İşbank’s Board of
Inspectors as an inspector and was promoted
to Assistant Manager in the Commercial and
Corporate Loans Monitoring and Follow-up
Division in 2002, Unit Manager in the same
Division in 2006, and Regional Manager in the
Retail Loans Monitoring and Follow-up Division
in 2011. In 2014, Mr. Kurbanoğlu was appointed
as Division Manager of the Commercial and
Corporate Loans Monitoring and Follow-up
Division and has been serving as the Deputy Chief
Executive since 25 March 2022.
Born in Ankara in 1968. Mr. Sabri Gökmenler
graduated from the Computer Engineering
Department of Middle East Technical University
in 1991 and completed his master's degree in the
same department in 1995. Mr. Gökmenler, who
began his career at İşbank in 1991 as a Software
Specialist, served in Softtech, a subsidiary of İşbank,
from 2004 onwards. He became the Head of the
IT Architecture & Security Management Division
of İşbank in 2008 and Head of the Information
Technologies Division in 2012. Mr. Gökmenler
attended the Advanced Management Program
(AMP) at Harvard Business School in 2018 and
was appointed as Deputy Chief Executive on 28
January 2021.
Mr. Gökmenler is currently the Chairperson of the
Board of Directors of Softtech, İş-Net, and GullsEye,
and a Board Member of İşbank AG and MaxiDigital
in Germany. He is also an Advisory Board Member
at KUIS Artificial Intelligence Center established in
cooperation with Koç University and İşbank, and
an Executive Board Member at Blockchain Türkiye
Platform.
Born in 1978 in Ankara, Mr. Can Yücel graduated
from Middle East Technical University, Faculty of
Economic and Administrative Sciences, Department
of Economics in 1999. Mr. Yücel started his
professional career as a Trainee Assistant Inspector
at the Board of Inspectors of İşbank in the same
year. He served as Assistant Manager at SME
Loans Underwriting Division in 2008 and Assistant
Manager at Corporate Loans Underwriting Division
in 2009; appointed as Unit Manager in the same
division in 2011.
In 2016, Mr. Yücel was appointed as Head of the
Corporate Loans Underwriting Division and as the
Başkent Corporate/Ankara Branch Manager in 2020.
Having completed the Harvard Business School
- Advanced Management Program, Mr. Yücel was
promoted to Deputy Chief Executive on 26 August 2021.
Ms. İzlem Erdem graduated from Marmara
University, Faculty of Economics and Administrative
Sciences, Department of Economics (English) in
1990. She attended the Advanced Management
Program at Harvard Business School in 2016. In
1990, Ms. Erdem started working as an Assistant
Economics Specialist in the Economic Research
Division of Türkiye İş Bankası A.Ş. and became
Assistant Manager in 1998. In 2000, Ms. Erdem
was assigned to the Capital Markets Division,
and in 2004 she assumed the position of Unit
Manager in the same division. In April 2008,
she was appointed as Division Manager in the
Economic Research Division of İşbank and was
promoted to Chief Economist in 2018. Ms. Erdem
was appointed as Deputy Chief Executive in March
2022. In addition to her duties at İşbank, Ms. Erdem
serves as the Chairperson of the Board of Directors
at İş Yatırım Ortaklığı A.Ş. and İmeceMobil Tarım
Platformu Elektronik Hizmetler Ticaret A.Ş. and as
a Board Member at Birleşik İpotek Finansmanı A.Ş.
Ms. İzlem Erdem has been a member of the Board
of Directors at Şişecam since 25 March 2015.
Born in Bingöl in 1970, Mr. Mehmet Celayir
graduated from Istanbul University, Faculty of
Economics, Department of International Relations.
Mr. Celayir joined İşbank in 1996 as a clerk in the
Elazığ Branch and after serving in various branches
and divisions of İşbank, he was appointed Deputy
Chief Executive on 14 December 2022 while
serving as the Gaziantep Corporate Branch
Manager, a position he has held since 2020.
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Organization Chart*
BOARD OF DIRECTORS
CHIEF EXECUTIVE OFFICER
HAKAN ARAN
AUDIT COMMITTEE
YUSUF ZİYA TOPRAK
ERSİN ÖNDER ÇİFTÇİOĞLU
DEPUTY CHIEF
EXECUTIVE
N. Burak Seyrek
DEPUTY CHIEF
EXECUTIVE
Ebru Özşuca
DEPUTY CHIEF
EXECUTIVE
Gamze Yalçın
DEPUTY CHIEF
EXECUTIVE
H. Cahit Çınar
DEPUTY CHIEF
EXECUTIVE
Ozan Gürsoy
DEPUTY CHIEF
EXECUTIVE
Sezgin Yılmaz
DEPUTY CHIEF
EXECUTIVE
Sabri Gökmenler
DEPUTY CHIEF
EXECUTIVE
Sezgin Lüle
DEPUTY CHIEF
EXECUTIVE
Can Yücel
DEPUTY CHIEF
EXECUTIVE
İzlem Erdem
DEPUTY CHIEF
EXECUTIVE
Suat Sözen
DEPUTY CHIEF
EXECUTIVE
Tufan Kurbanoğlu
DEPUTY CHIEF
EXECUTIVE
Mehmet Celayir
HEAD OFFICE
COUNSELLORSHIP
CORPORATE AND
COMMERCIAL
BANKING
MARKETING
DIVISION
TREASURY
DIVISION
FINANCIAL
MANAGEMENT
DIVISION
LEGAL AFFAIRS
DIVISION
AGILE
MANAGEMENT
DIVISION
PERSONAL
BANKING
MARKETING
DIVISION
INFORMATION
TECHNOLOGIES
DIVISION
DIGITAL
BANKING
DIVISION
LOANS PORTFOLIO
MANAGEMENT
DIVISION
SMES AND
BUSINESS
BANKING
MARKETING
DIVISION
GENERAL
SECRETARIAT
LEGAL AFFAIRS
AND FOLLOW UP
DIVISION
BANKING BASIC
OPERATIONS
DIVISION
COMMERCIAL
BANKING SALES
DIVISION
ECONOMIC
RESEARCH
DIVISION
FINANCIAL
INSTITUTIONS
DIVISION
CONSTRUCTON
& REAL ESTATE
MANAGEMENT
DIVISION
HUMAN
RESOURCES
MANAGEMENT
DIVISION
PERSONAL
BANKING SALES
DIVISION
PURCHASING
DIVISION
CUSTOMER
SERVICES DIVISION
CORPORATE
LOANS
ALLOCATION
DIVISION
SMES AND
BUSINESS
BANKING SALES
DIVISION
CORPORATE
COMMUNICATION
DIVISION
LOANS
MONITORING
DIVISION
SUPPORT
SERVICES DIVISION
FREE ZONE
BRANCHES
CAPITAL
MARKETS
DIVISION
BRANCHES
ABROAD &
FOREIGN
REPRESENTATIVES
INVESTOR
RELATIONS &
SUSTAINABILITY
DIVISION
MANAGERIAL
REPORTING
& INTERNAL
ACCOUNTING
DIVISION
SUBSIDIARIES
DIVISION
CORPORATE
ARCHITECTURE
DIVISION
STRATEGY &
CORPORATE
PERFORMANCE
MANAGEMENT
DIVISION
TALENT
MANAGEMENT
DIVISION
PERSONAL
BANKING
PRODUCT
DIVISION
DATA
MANAGEMENT
DIVISION
PERSONAL
LOANS
DIVISION
ARTIFICIAL
INTELLIGENCE
DIVISION
PAYMENT
SYSTEMS
ECOSYSTEM
DIVISION
PAYMENT
SYSTEMS
OPERATIONS
DIVISION
RETAIL LOANS
ALLOCATION
DIVISION
AGRICULTURAL
BANKING
MARKETING
DIVISION
PRIVATE BANKING
MARKETING &
SALES DIVISION
RETAIL LOANS
MONITORING
DIVISION
FOREIGN TRADE
& COMMERCIAL
LOAN OPERATIONS
DIVISION
PROJECT
FINANCING
DIVISION
COMMERCIAL
BANKING
PRODUCT
DIVISION
COMMERCIAL
& CORPORATE
LOANS
MONITORING
DIVISION
PAYMENT
SYSTEMS
PRODUCT
DIVISION
COMMERCIAL
LOANS
COLLECTION
DIVISION
SECRETARIAT TO
THE BOARD OF
DIRECTORS
BOARD OF
INSPECTORS
DEPUTY CHIEF
EXECUTIVE
Sezai Sevgin
INFORMATION
SECURITY
DIVISION
INTERNAL
CONTROL
DIVISION
CORPORATE
COMPLIANCE
DIVISION
RISK
MANAGEMENT
DIVISION
* As of 31.03.2023
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Information on Board of
Directors Meetings in
2022
At İşbank, the Board meetings are held at least once a
month, yet interim meetings might be held in case of
need. Meeting agendas are prepared in accordance with
the proposals of Head Office divisions. Moreover, various
reports requested by the Board of Directors from the Bank
management and off the agenda topics put forward by the
Board members are discussed during the meetings.
By the end of 2022, 16 Board meetings were held
and 15 of them were held by full participation. 983
pages of minutes were recorded for the said meetings,
which lasted 62 hours in total. A total of 235 files were
reviewed, which consist of 167 files for loan underwriting
and 68 files on other issues regarding loans; based
on the work carried out by convening meetings or by
individual review and signing of the file by each Board
Member, which resulted in 168 loan decisions. A total
of 567 files were reviewed on non-credit matters and
567 resolutions were taken. Consequently, 963 Board
resolutions were taken in 2022, including 228 that were
passed during the meetings.
İşbank Committees
Assessments on İşbank Committees
The Board of Directors has several governance
committees in place to support the activities of
the Board in various areas of expertise. İşbank
committees presented their decisions and reports
to the Board of Directors in 2022 when necessary
within the framework of their activities, and the
necessary decisions have been taken as a result of the
assessment of the Board of Directors.
Audit Committee
Pursuant to its working principles, the Audit Committee
is responsible for holding meetings at least twice a year,
provided that six-month periods are not exceeded; it
is obligated to inform the Board of Directors about the
results of the activities carried out and measures to
be taken based on these results and about necessary
practices to be implemented. Moreover, the Audit
Committee is obligated to provide its recommendations
regarding other issues that are deemed significant
for the Bank in order to carry out its activities safely.
The Audit Committee works in collaboration with the
Remuneration Committee and the Risk Committee.
The Audit Committee is in charge of;
ੵ Ensuring that the internal systems of the Bank function
efficiently and sufficiently, that these systems and the
accounting and reporting systems operate within the
framework of the related regulations and the Bank’s
policies, and that the information produced has integrity,
ੵ Making preliminary assessments necessary for the
selection of independent audit firms, rating, valuation,
and support service institutions, regularly monitoring
the activities of these institutions selected by the
Board of Directors, evaluating them periodically within
the context of the provisions of the legislation, and
providing information to the Board of Directors,
ੵ Reviewing the assessments of the independent
audit firms, evaluating independent audit results, and
consulting with independent auditors,
ੵ Informing the Board of Directors about findings of the
independent auditors and internal systems divisions,
and about measures taken by the top management
and by the units reporting to the top management,
ੵ Ensuring that the internal audit functions of subsidiaries
that are subject to consolidation are coordinated in line
with the related regulations,
ੵ Receiving information and reports about internal
systems and functioning of divisions within the scope of
internal systems, their operations including consolidated
risks, and about related policies and regulations,
ੵ Overseeing whether the reports accurately and
completely reflect the financial position of the Bank,
ੵ Making assessments in order to ensure whether or
not required procedures and principles have been
implemented for detecting, measuring, monitoring, and
controlling potential and existing risks incurred by the
Bank and ensuring that risk framework and risk culture,
in line with the Bank’s structure and operations, are
established within the Bank,
ੵ Ensuring that the internal capital adequacy evaluation
process (ICAAP) includes all risks in a consolidated
manner and audit and control processes are
established to provide required assurance on its
adequacy and accuracy,
ੵ Evaluating professional education levels and
competency of managers and personnel assuming
duties in divisions within the scope of internal systems,
making suggestions to the Board of Directors for the
selection of managers, and presenting opinions to the
Board of Directors during their dismissal,
ੵ Establishing communication channels to make
sure that information will be provided directly to the
Audit Committee, the internal audit unit, or the Bank
inspectors in case of Bank fraud,
ੵ If required, requesting information, documents or
reports from all Bank units, support service contractors,
and independent auditors and, subject to Board
approval, receiving consultancy from specialists in their
respective fields,
ੵ Informing or reporting to the Board about the results
of its own operations, the measures needed to be
taken in order for the Bank’s operations to be within the
framework of the related legislation and Bank policies
in a continuous and secure way and its evaluations,
opinions, and recommendations on any other issues
that are deemed to be important,
ੵ Fulfilling other responsibilities determined by the
related legislation and the duties given by the Board
within this framework.
Committee Members:
ੵ Deputy Chairperson of the Board of Directors and
Chairperson of the Audit Committee: Yusuf Ziya Toprak
ੵ Board Member: Ersin Önder Çiftçioğlu
As of 2022, the Audit Committee held 60 meetings with
full participation and adopted 100 resolutions.
TRNC Internal Systems Committee
TRNC Internal Systems Committee has been established
within the framework of TRNC Banking Law and related
regulations. The Committee holds meetings at least
twice a year, provided that a six-month period is not
exceeded, and informs the Board of Directors on the
results of its own activities, its opinions on the measures
needed to be taken, and the necessary practices to be
implemented by the branches that operate under the
TRNC office, and other important issues in order for
these branches to operate in a secure way.
The TRNC Internal Systems Committee is responsible
for ensuring the efficiency and sufficiency of the
internal systems provided by the Bank in relation to the
operation of the branches that operate under the TRNC
office, ensuring the operation of the internal systems,
accounting, and reporting systems in line with the law
and related regulations and ensuring the integrity of
the produced information, carrying out the preliminary
assessment of independent audit firms and other
companies providing services directly related to other
banking operations to be selected by the Board, and
monitoring regularly and coordinating these companies
that are selected and contracted by the Board.
Committee Members:
ੵ Deputy Chairperson of the Committee and Board of
Directors: Yusuf Ziya Toprak
ੵ Board Member: Ersin Önder Çiftçioğlu
As of 2022, the TRNC Internal Systems Committee held
12 meetings with the full participation of its members
and adopted 14 resolutions.
Credit Committee
The Credit Committee makes resolutions on loan
allocation within its authorization limit, makes decisions
on demands to change the loan allocation conditions
within its authorization limit and carries out other
assignments regarding loans given by the Board.
The Credit Committee consists of three members:
the Chief Executive Officer or Deputy Chief Executive,
who is also the chairperson of the Committee, and two
members from the Board of Directors. There will also be
two alternate members of the Committee who will stand
in should the need arise.
As the loan proposal files are presented, the Committee
decides on the loan allocation with consensus after
each Committee Member examines and signs the
files. Unanimous Credit Committee resolutions are
implemented immediately, while majority resolutions are
implemented after approval by the Board of Directors.
Committee Members:
ੵ Regular member and Chairman of the Committee Chief
Executive Officer: Hakan Aran
ੵ Chairperson of the Board of Directors: Adnan Bali
ੵ Board Member: Feray Demir
Alternate members
ੵ Vice Chairperson of the Board of Directors: Yusuf Ziya
Toprak
ੵ Board Member: Fazlı Bulut
By the end of 2022, 58 files under the authority of the
Credit Committee were evaluated, and 45 resolutions
were adopted with the full participation of the members.
Credit Revision Committee
In accordance with the Bank's Credit Risk Policy, the
Credit RevisionCommittee is formed at the end of
each year to evaluate the Bank's relationships with its
credit customers by reviewing the commercial loan
portfolio and determining the limits to be considered for
the following year with respect to the aforementioned
persons and institutions.
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Committee Members:
ੵ Chairperson of the Board of Directors: Adnan Bali
ੵ Vice Chairperson of the Board of Directors: Yusuf Ziya
Toprak,
ੵ Board Member: Feray Demir,
ੵ Board Member: Ersin Önder Çiftçioğlu
ੵ Board Member: Sadrettin Yurtsever
The Credit Revision Committee completed its review
of certain companies and groups under the authority
of the Board of Directors and the Credit Committee on
21.03.2022.
Corporate Governance Committee
The Corporate Governance Committee was
established to monitor the Bank’s compliance with the
corporate governance principles, make improvements
in corporate governance practices and suggestions
to the Board, and fulfill the tasks of the Corporate
Governance Committee and Nomination Committee
as set out in the applicable legislation. The Committee
consists of a chairperson and three members.
Committee Members:
ੵ Committee Chairperson and Board Member: Ersin
Önder Çiftçioğlu
ੵ Board Member: Sadrettin Yurtsever
ੵ Board Member: Feray Demir
ੵ Head of the Investor Relations and Sustainability
Division: Neşe Gülden Sözdinler
As of 2022, the Corporate Governance Committee held
4 meetings with the full participation of its members
and took 4 decisions.
Sustainability Committee
The Sustainability Committee was established to develop
the Bank's sustainability strategy and policies and submit
them to the Board of Directors for approval, to set out
the sustainability targets and action plans and ensure
coordination within the Bank for their implementation, to
ensure that sustainability issues are incorporated in the
Bank's strategic business plans, to monitor the progress of
the metrics and targets, and to perform other similar tasks.
The Committee is the highest authority responsible for
sustainability activities in the Bank.
In accordance with the Board's resolution dated
24.12.2020 with no. 44176, the Committee consists of
one chairperson and fourteen members. The Committee
Chairperson is Adnan Bali, and the Committee Members
are Feray Demir, Ersin Önder Çiftçioğlu, N. Burak Seyrek,
Gamze Yalçın, H. Cahit Çınar, Ozan Gürsoy, Sezgin Yılmaz,
Sabri Gökmenler, Can Yücel, Sezai Sevgin, İzlem Erdem,
Suat E. Sözen, Hürdoğan Irmak and Neşe Gülden Sözdinler.
As of year-end 2022, the Sustainability Committee held
1 meeting with the full participation of its members and
took 1 decision.
Remuneration Committee
The Remuneration Committee was established to
perform functions and activities related to monitoring
and controlling the remuneration policies of the Bank
on behalf of the Board of Directors. The Committee has
two members. The Remuneration Committee convenes
at least twice a year, not to exceed six months between
two meetings, and submits to the Board of Directors the
results of its activities and its opinions regarding other
issues deemed important.
Within the framework of compliance with Corporate
Governance Principles, the Remuneration Committee
is responsible for monitoring and checking policies
related to remuneration management on behalf of the
Board of Directors and ensuring that remuneration is
in compliance with the Bank's ethical values, internal
balances and strategic goals. The Committee is also
responsible for evaluating remuneration policy and
practices within the framework of risk management,
reviewing the remuneration policy and submitting
proposals as required to the Board of Directors, as well
as fulfilling other responsibilities set out in applicable
legislation and the tasks assigned to it by the Board of
Directors within this framework.
Committee Members:
ੵ Chairperson of the Committee and Board of Directors:
Adnan Bali
ੵ Board Member: Feray Demir
As of 2022, the Remuneration Committee held 8
meetings with the full participation of its members and
took 12 decisions.
Board of Directors Operating
Principles Committee
The Board of Directors Operating Principles Committee
is responsible for submitting its findings, opinions and
recommendations regarding the interpretation and
implementation of applicable legal provisions, including
especially the İşbank Board of Directors Operating
Principles and Procedures and the Directions on İşbank
Board of Directors Operating Principles.
Committee Members:
Committee Members:
ੵ Chairperson of the Committee and
Board of Directors: Adnan Bali
ੵ Board Member: Feray Demir
ੵ Board Member: Durmuş Öztek
ੵ Adnan Bali: Chairman of Board of Directors and Head
of Risk Committee
ੵ Yusuf Ziya Toprak: Vice Chairman of Board of Directors
and Head of Audit Committee
ੵ Ersin Önder Çiftçioğlu: Member of Board of Directors
Risk Committee
ੵ Hakan Aran: CEO
Risk Committee is responsible for articulating the risk
management strategies and policies İşbank will adhere
to both on a consolidated and unconsolidated basis,
presenting them to the İşbank Board of Directors
for approval and monitoring compliance with them.
Committee is the common communication platform for
the Bank’s executive divisions in terms of assessing the
risk the Bank is exposed to, making suggestions about
the actions to be taken and approaches to be followed.
The Committee's principal duties are the following:
䬏Preparing the risk strategies and policies and
presenting to the Board for approval.
䬏Monitoring the effective usage of the outcomes of the
Internal Capital Adequacy Assessment Process in the
planning and decision making processes of the Bank.
䬏Negotiating and adjudicating the issues addressed by
Risk Management Division.
䬏Recommending the level of risk limits for
exposures/possible exposures to the Board,
monitoring the breaches of these limits and making
recommendations regarding the elimination of those
breaches to the Board.
䬏Recommending the amendments in the risk policies to
the Board.
䬏Monitoring the risk management processes, i.e. risk
identification, definition, measurement, assessment,
control and reporting processes, carried out by Risk
Management Division.
䬏Monitoring the accuracy and reliability of the risk
measurement methodologies and their results.
䬏Suggesting proposals regarding the determination
of risk appetite statement and its amendments to the
Board.
䬏Taking measures to establish risk culture in the Bank,
creating processes to fulfill the responsibility of
supervision, understanding all of the risks arising from
the activities of the Bank and supervising the integration
of these risks to risk management system of the Bank.
ੵ Ebru Özşuca: Deputy Chief Executive and Head of
Asset & Liability Management Committee
ੵ Sezai Sevgin: Deputy Chief Executive
ੵ Can Yücel: Deputy Chief Executive
ੵ Gamze Yalçın: Deputy Chief Executive
ੵ Hürdoğan Irmak: Head of Risk Management Division
ੵ Hamit Umut Toğay: Head of Internal Control Division
ੵ Süleyman H. Özcan: Corporate Compliance Division
Risk Committee contributes to the configuration of
Group risk policies also through consolidated group
meetings. In the activities that the Risk Committee
carries out on a consolidated basis, the deputy CEO
responsible from Subsidiaries Division and Head of
Subsidiaries Division also attend the meetings.
In the Risk Committee meetings held in the first 3
quarters of 2022, risk management practices of İşbank
and its subsidiaries under consolidated risk policies
have been evaluated, risk reports have been presented
to the Committee, the results have been analyzed and
decisions regarding the risk management systems and
processes were taken. By the end of the 3rd quarter,
the Committee had 8 meetings and 27 decisions have
been taken.
Operational Risk Committee
Operational Risk Committee which is established by
the Board decision dated 30.04.2020 and numbered
43790, operates to determine the strategies and
policies for managing operational risks that Bank may be
exposed to, improve the operational risk management
framework and strengthen governance model regarding
operational risks. Operational Risk Committee is formed
to meet at least twice during a calendar year, and the
members are listed below.
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Committee Members:
ੵ Yusuf Ziya Toprak: Vice Chairman of Board of Directors
and Head of Operational Risk Committee
ੵ Ersin Önder Çiftçioğlu: Member of Board of Directors
ੵ Hakan Aran: CEO
ੵ Ozan Gürsoy: Deputy Chief Executive
ੵ Sezgin Yılmaz: Deputy Chief Executive
ੵ Sabri Gökmenler: Deputy Chief Executive
ੵ Sezai Sevgin: Deputy Chief Executive
ੵ Sezgin Lüle: Deputy Chief Executive and Head of
Innovation Committee
ੵ Gürler Özkök: Head of Board of Inspectors
ੵ Süleyman H. Özcan: Head of Corporate Compliance
Division
ੵ H. Umut Togay: Head of Internal Control Division
ੵ Hürdoğan Irmak: Head of Risk Management Division
ੵ Bülent Akdemir: Head of Information Security Division
ੵ Burcu Nasuhoğlu: Unit Manager of Risk Management
Division
Committee functions in coordination with Risk
Committee and reports operating results to the Board
through Audit Committee.
By the end of 2022, Operational Risk Committee had
2 meetings with the attendance of all members and 2
decisions have been taken.
Corporate Social Responsibility
Committee
The Corporate Social Responsibility Committee
evaluates developments related to current activities,
collaboration conditions, requests and project proposals
submitted to the Bank and monitors the results. The ratio
of non-executive managers in the Committee is 50%,
and there are no independent members. As of the end of
2022, 13 positive and 6 negative decisions were taken
in 6 meetings held with the participation of all members
of the Corporate Social Responsibility Committee, and
information was provided on 9 subjects.
Committee Members:
ੵ Board Member: Feray Demir
ੵ Board Member Fazlı Bulut
ੵ Board Member: Durmuş Öztek
ੵ Board Member Sadrettin Yurtsever
ੵ Deputy Chief Executive: Yalçın Sezen
ੵ Deputy Chief Executive: Can Yücel
ੵ Deputy Chief Executive: Suat E. Sözen
ੵ Head of the Corporate Communications Division: Gül
Meltem Atılgan
Committee Name
Audit Committee
TRNC Internal Systems Committee
Credit Committee
Credit Revision Committee
Corporate Governance Committee
Sustainability Committee
Remuneration Committee
Board of Directors Operating
Principles Committee
Risk Committee
Operational Risk Committee
Corporate Social Responsibility
Committee
Number of Members Number of Meetings
Decisions Taken
2
2
5
5
4
15
2
4
11
14
7
60
12
-
7
4
1
8
0
11
2
6
100
14
45
1
4
1
12
0
33
2
19
Information on Risk Management
Policies Applied per Risk Types
Besides banking activities, both financial and non-
financial risks encompassing the whole group required to
be analyzed, monitored and reported from the standpoint
of group risk management in addition to that of banking-
specific risk management principles. Beyond regulatory
requirements this aspect of risk management has
become an industry standard for corporate governance.
The risk management process, organized within
the framework of advanced risk management
methodologies and favors a common risk management
culture throughout the establishment, is structured
to emphasize good corporate governance, assuring
segregation of units responsible for monitoring and
controlling risk from executive functions. In that respect,
risk definition, measurement, analysis, monitoring,
reporting and control functions are carried out within the
same framework.
The process of risk management and the functions
involved in that process are among the highest priority
responsibilities of the İşbank Board of Directors. The
Risk Management Division, which acts through the Risk
Committee and Operational Risk Committee and forms
a functional constituent of the risk management function
in collaboration with the Bank Credit Committee and the
Asset & Liability Management Committee, carries out
the works towards the regulatory and internal capital
adequacy in accordance with the Basel framework and
consistent with international best practices, in addition
to working towards developing and validating risk
measurement methodologies and optimizing the capital
adequacy management process.
Capital Adequacy Policy
Capital Adequacy Policy defines the level of capital, on
consolidated and unconsolidated basis, that the Bank
must hold against potential losses arising from financial
risks associated with on and off-balance sheet items
in addition to non-financial risks caused by the Bank’s
operations; and establishes the principles for maintaining
and monitoring the minimum capital levels determined in
accordance with the regulations and the Internal Capital
Adequacy Assessment Process. Capital Adequacy
Policy is an integral part of the Risk Policies.
Credit Risk Policy
Credit risk is defined as the probability of the Bank
having a loss due to the counterparty not fulfilling the
obligation partially or fully on maturity as affirmed in the
agreement. Credit Risk Policy sets the framework for
credit risk management, control and monitoring, roles
and responsibilities and credit risk limits.
İşbank maintains identification, measurement and
management of credit risk across all products and
activities as defined in the Article 48 of the Banking
Law. The Board reviews credit risk policies and
strategies annually at minimum. CEO, and the other chief
executives and the division heads that are involved in the
credit lifecycle are responsible for the execution of credit
risk policies.
The credit risk profile of the Bank is continuously
monitored. The trend of risk factors and the changes in
these factors are reported to the senior management
regularly. Avoiding concentration is essential in
managing credit risk. Concentration in the credit
portfolio is monitored by taking the balance of earnings,
riskiness and capital charges into account. To this end,
limits specified by the Board of Directors based on
counterparties, industry, credit type, collateral, country,
maturity, currency etc. are implemented.
In managing credit risk, İşbank implements internal risk
limits specified by the Board of Directors that restrict the
maximum credit risk based on parameters such as risk
groups and sectors in addition to the credit risk limits
that are mandated by legal regulations. These internal
limits are determined in a way that does not lead to risk
concentrations.
İşbank employs internal credit risk rating systems in
managing credit risk. Internal credit risk rating systems
and artificial intelligence applications are employed with
the capability to monitor credit risk on a portfolio basis; to
calculate expected and unexpected credit losses and to
assess credit risk correctly in credit pricing, performance
management, sales and marketing. The assessment and
management of the risks related to the models are done
according to the Model Risk Management Policy.
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Asset and Liability Management Risk
Policy
Asset and liability management risk is defined as; the risk
of loss caused by Bank’s failure to effectively manage all
financial risks arising from the bank's assets, liabilities
and off-balance sheet transactions. Market risk of trading
book, structural interest rate risk of banking book and
liquidity risk are all within the scope of asset and liability
management risk.
All principles and procedures related to constitution
and management of Bank’s asset-liability structure
and Bank’s risk appetite is established by the Board
of Directors. Ensuring asset and liability management
risk being maintained within the levels imposed by
legislation and internal risk limits is the first priority. Within
the Bank’s risk appetite framework risk tolerance levels
which aim to put a cap on the amount of risk undertaken
by the Bank are determined by Board of Directors for
each risk type on both bank-only and consolidated
basis. In this process, liquidity, target income level and
general expectations about the risk factors are taken into
consideration.
Board of Directors and Audit Committee are obliged
to track that Bank’s capital is used optimally. For this
purpose, they have to keep risks under control and
ensure necessary actions being taken.
Asset-Liability Management Committee is responsible
for governance of asset and liability management risk
in accordance with the risk appetite framework and risk
limits determined by Board of Directors and within the
principles and procedures expressed in ALM risk policy.
Measuring asset and liability management risk, reporting
the results and monitoring the compliance with the risk
limits are the responsibilities of Risk Management Division.
The level of the risk taken is reviewed under different
scenarios. Measurement results are tested in terms of
reliability and integrity. Asset and liability management risk
is reported to Risk Committee and reported to the Board of
Directors through Audit Committee.
Compliance with risk limits is closely and continuously
monitored by Risk Management Division, Asset-Liability
Management Committee and related business units. In
the event of a breach in the risk limits, the breach and
its reasons are instantly reported to Board of Directors
through Audit Committee. Course of action needed to be
taken in order to eliminate the breach is determined by
the Board.
Asset and liability management processes and
compliance with the policy rules are audited by internal
audit system. The principles regarding the audit process,
audit reports and fulfillment of action plans to eliminate
the errors and gaps determined by internal audit are
established by the Board of Directors.
Stress Testing Policy
The purpose of the Stress Testing Policy is to measure
the significant risks and vulnerabilities that may arise
from both bank specific adverse developments or from
stress conditions on general economic and financial
environment.
Stress testing programme is defined as the collection
of studies and analyses to assess the risks generated
by Bank’s activities and the programme covers the
methodologies, assumptions and scenarios related
with those analyses. In order to ensure the validity
and appropriateness of the results; stress testing
programme is regularly monitored and updated taking
into consideration the current economical conjuncture
and market conditions, Bank’s products, strategies
and technological capabilities and Bank’s risk appetite
framework.
Bank implements a stress testing programme oriented
to assess the risks both from a holistic view (i.e. bank-
wide stress tests) and on the basis of the important risk
types (i.e. individual stress tests) in accordance with the
regulations and internal procedures and the results are
reported to the senior management, Board of Directors
and other related legal authorities.
The Board of Directors is responsible for conducting
the stress testing programme as a whole. The Board
of Directors ensures that the outputs of the stress
testing programme are evaluated and used as an input
for decision making on the relevant fields. Executing
the analyses included in stress testing programme,
reporting the outputs of the stress tests and monitoring
the compliance with respect to the risk limits are the
responsibility of Risk Management Division. The scope
of the stress testing programme, the set of risk factors
to be used in the analyses and the level of the stress
parameters are determined by Risk Committee.
The processes related to stress testing and compliance
with the policy rules are audited by internal audit system.
The principles regarding the audit process, audit reports
and fulfillment of action plans to eliminate the errors and
gaps determined by internal audit are established by the
Board of Directors.
Employees have the understanding of the Bank's
objective to attain a working environment aiming to reduce
the probability of loss, considering that the entire internal
rules and procedures, led by operational risk policy, and act
sensitively to the inherited operational risks and controls.
Reputational Risk Policy
Reputational risk is defined as loss of trust to the Bank or
reputation impairment as a result of non-compliance with
existing legal regulations or negative view of parties such
as current or potential customers, partners, opponents and
supervisory authorities and related studies are conducted
by Risk Management Division. Reputational Risk Policy
determines principles and procedures for definition,
evaluation, control, monitoring, reporting and management
activities of reputational risk sources.
Reputational risk sources are evaluated both individually
and as a whole, appropriate systems and controls
are established to manage risky elements efficiently.
Risk Management Division is responsible for reporting
reputational risk evaluations periodically to Risk
Committee, Audit Committee and the Board of Directors.
All the employees execute their functions with the
responsibility of preserving the reputation of the Bank.
Consolidated Risk Policies
Compliance with risk management principles related
to the Bank’s subsidiaries is monitored according
to Bank’s Consolidated Risk Policies. Through
Consolidated Risk Policies, subsidiaries identify their
specific risk management policies which are approved
by their boards that form the framework of their risk
management systems and processes. Risk levels of
subsidiaries are monitored closely by Risk Management
Division and reported periodically to the Risk Committee
and the Board.
Operational Risk Policy
Operational risk is defined as “the risk of loss resulting
from inadequate or failed internal processes, people and
systems or from external events”. This definition includes
legal risk. Risk Management Division is responsible
for the risk management activity on this particular risk.
Operational risk management activities comprise defining,
measuring, analyzing, monitoring and reporting, controlling
of operational risks, following up the new techniques
on management of operational risks besides regulatory
and internal reporting. The fundamental principles and
procedures of risk management are determined in
Operational Risk Policy.
Categorization of inherited operational risks within the
activities and processes is made possible by the Risk
Catalogue. It serves as the basic document to define
and classify the risks and is subject to alteration as
conditions change. Risk Catalogue is modified in line with
the improving risk management practices and changing
regulations.
Operational risk is managed on the basis of the three
lines of defense approach within the framework of risk
management policies approved by the Board. Risk
appetite and affiliated internal limits which are determined
by the Board for the operational risks are monitored
periodically. Internal and external factors that may affect
banking operations negatively are considered in the
process of determining operational risks. Operational risk
management process combines both qualitative and
quantitative approaches in measurement and assessment.
In the process of measurement and assessment, risks
are prioritized with respect to financial, legal, reputational
and operational effects of operational risks that Bank is
exposed to. Apart from the calculations executed within
the scope of legislation, “internal measurement methods”,
“impact - likelihood analysis”, “loss data analysis”, “scenario
analysis”, “stress testing” and “key risk indicators” are
utilized. Studies are reported to the Board through Risk
Committee and Operational Risk Committee.
Operational risks that the Bank is exposed in the banking
and information systems processes, risk levels of new
product, service and activities, support and valuation
services, operational risk related loss events and risk
indicators are monitored regularly by Risk Management
Division and reported periodically to the Risk Committee,
Operational Risk Committee and the Board.
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Information Systems Management
Policy
The purpose of the Information Systems Management
Policy is to determine the principles regarding
identification, measurement, monitoring, control,
reporting and management of risks arising from
information systems management. With this policy, it
is intended to effectively manage information systems,
which is a critical element for sustaining Bank's activities,
by considering information systems management as
a part of corporate risk management practices. The
provisions of this policy are applied in the management
of the Bank's information systems and all elements
containing these systems.
Risks derived from information technologies are basically
assessed within the scope of Bank’s operational risk
management framework. It is essential that those risks
which could be seen as multipliers of the other risks
derived from activities of the Bank are measured, closely
monitored and controlled within Bank’s integrated risk
management framework.
Model Risk Management Policy
The purpose of the Model Risk Management Policy is
to regulate the procedures and principles, regarding
the model risk management by considering the end
to end life cycle of the models used by the Bank. With
the policy, it is aimed to manage the model risk, caused
by errors, malfunctions or deficiencies in the life cycle
of the models used in the activities of the Bank, with a
holistic perspective.
In the bank, model risk is managed by the three line of
defense structure; first line of defense (model owner,
model development team, model implementation
team, model user), second line of defense (model risk
management team, validation team, internal control)
and the third line of defense (internal audit). Model risk
management covers the entire model life cycle. The
main activities in each step of the model life cycle and
the responsibilities within the scope of these activities
are determined in the policy.
Climate Change Risk Policy
Climate change includes “transition risks” that may
be encountered due to the transition to a low carbon
economy and “physical risks” that may arise due
to the effects of climate change on nature. Bank’s
Climate Change Risk Policy regulates the principles
and procedures regarding the identification, definition,
evaluation and/or measurement, monitoring, control,
reporting and management of climate change risks that
the Bank may be exposed to as a result of its activities.
Climate change risk, in addition to being a type of risk that
the Bank may be directly exposed to, may also arise due
to other risks that may occur during the execution of its
operations. Therefore, Climate Change Risk Policy is an
integral part of the Bank's other Risk Policies.
The main purpose of climate change risk management
is to ensure the compatibility of the Bank's activities and
practices with its climate change strategy. Responsibilities
regarding climate change risk management, have been
defined within the framework of the three line of defense.
Basically, the task of the first line is to ensure that credit
decisions are made taking into account the risks of climate
change throughout the lending process. The second
line determines the working principles, rules, policies and
requirements regarding climate change risk. The third
line provides assurance to the Board of Directors that the
structure described here is functioning properly.
Managers of Internal Systems
Second Line of Defense:
Name
Sezai Sevgin
Hürdoğan Irmak
Süleyman H. Özcan
Engin Yalçın
Duty
Term of Office
Professional
Experience
Deputy Chief
Executive Responsible
for Internal Systems:
Head of Risk
Management Division
Head of Corporate
Compliance Division
(Compliance Officer)
Head of the Internal
Control Division
1 year 2 months
5 years 3 days
2 years 6 months
2 months
33 years
22 years
29 years
26 years
Board of Inspectors
İşbank AG
Corporate Marketing
Division
Commercial Banking
Marketing Division
Gebze Corporate
Branch
Maslak Corporate
Branch
Bayındır Health Group
Board of Inspectors
Accounting Division,
Change Management
Board,
Strategy and
Corporate
Board of Inspectors
Payment Systems
Performance
Management Division,
Retail Banking Product
Division
Investor Relations
Division
İş Merkezleri Yönetim
ve İletişim A.Ş.
Corporate Loans
Underwriting Division
Board of Inspectors
Risk Management
Division
Bachelor’s Degree
Bachelor's Degree
Bachelor’s Degree
Bachelor’s Degree
Divisions
Previously Served
Educational
Background
Third Line of Defense:
Name
Duty
Term of
Office
Professional
Experience
Divisions Previously Served
Educational
Background
Gürler Özkök
Chairperson of the
Board of Inspectors
Risk Management Division
Deputy Chairperson of the Board of
Inspectors,
12 months
29 years
Izmir Branch
Izmir Commercial Branch
Akdeniz Corporate and Maslak
Corporate Branches
Master's
Degree Abroad
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Audit Committee’s Assessment on the Operation of Internal
Audit, InternalAudit, Compliance and Risk Management
Systems, and its Activities in the Reporting Period
Internal Audit
Reporting to the Board of Directors of İşbank, the Board
of Inspectors conducts audits of the Bank’s Head Office
divisions, banking processes, information systems,
domestic and foreign branches, and the activities of
consolidated subsidiaries. The audits aim to provide
assurance that the Bank’s activities are in compliance
with legal regulations, the Bank’s strategies, policies,
principles, and goals. The work carried out in this
direction prioritizes the assessment of the effectiveness
of the processes for identifying risks and developing
the necessary controls within the framework of the
activities of the first and second lines of defense. In
accordance with national and international quality
standards, audits are conducted on-site or remotely,
depending on business needs, with a modern and risk-
focused approach, utilizing the strength of the Board
of Inspectors’ deep-rooted audit culture and advanced
information technologies.
The Board of Inspectors also conducts preliminary
inspections, examinations, and investigations into
suspicions of internal crime.
The audit reports prepared as a result of the inspection
activities are communicated to the senior management
and relevant divisions via the Audit Committee, and
the measures taken in response to the findings are
monitored by the Board of Inspectors. The Board of
Directors closely monitors the activities of the Board of
Inspectors through monthly activity reports submitted via
the Audit Committee.
İşbank’s banking processes and information systems
are annually audited by the Board of Inspectors in
a risk-based manner to provide the basis for the
Management's Declaration to be submitted to an
independent auditor in accordance with the "Regulation
over External Audit Institutions’ Information Systems and
Banking Processes Audits" published by the Turkish
Banking Regulation and Supervision Agency (BRSA). In
this context, during the audit of the financial reporting
process within the routine banking processes, the
preparation of the consolidated financial statements
as well as the unconsolidated financial statements are
reviewed by the Board of Inspectors. In addition, during
the regular audits of subsidiaries, the financial reports
submitted by the related companies are reviewed within
legal regulations and basic accounting principles such as
accuracy and completeness.
In 2022, audits were conducted in domestic and foreign
branches, as well as in the Head Office Divisions and
Units, subsidiaries and Regional Directorates. In addition,
the Bank’s loans to the top 400 companies with the
highest credit risk, which constitute 47% of the Bank’s
total loans, were audited.
The following audits were conducted:
䬏Portfolio (Collective) Custody Service,
䬏Sustainability Management System,
䬏Gender Equality in Remuneration,
䬏Compliance Program on Prevention of Laundering
Proceeds of Crime and the Financing of Terrorism,
䬏Türkiye İş Bankası A.Ş. Group Compliance Program on
Prevention of Laundering Proceeds of Crime,
䬏London Branch Compliance Program on Prevention of
Laundering Proceeds of Crime,
䬏Valuation Services Received by İşbank,
䬏Internal Capital Adequacy Assessment Process
(ICAAP),
䬏Compliance with the Guidelines on Loan Allocation
and Monitoring Processes.
The management of customer complaints is also audited
by the Board of Inspectors, and customer complaints
received directly by the Board of Inspectors through
various channels, including the Ethics Line, are inspected
on a case-by-case basis..
Compliance
Compliance is the foremost duty and responsibility
of all managers and employees of İşbank at any level.
Compliance functions and activities executed in the
Bank's Head Office divisions, domestic and overseas
branches, and its subsidiaries are monitored by the
Corporate Compliance Division, which reports to the
Board of Directors. The purpose of the Corporate
Compliance Division is to make the maximum
contribution to the Bank's efforts to effectively manage
and control compliance risk according to a materiality-
and risk-based approach and to ensure the execution
and management of the Bank's activities in accordance
with applicable laws, regulations and standards at all
times.
Employees of the Sanctions and International
Obligations Unit participate in various events such
as seminars, trainings and conferences organized by
international organizations such as SIBOS, ACAMS,
correspondent banks, data provider companies, various
authorities, or other institutions.
The Compliance Risk Management Policy and
Combating Financial Crimes and Sanctions Policy
are available at www.isbank.com.tr under “Investor
Relations/Corporate Governance”.
Internal Control
The main objective of the internal control system is to
provide the maximum contribution to achieve İşbank’s
corporate targets set in accordance with the Bank’s
vision, mission and strategies, as well as stakeholder
expectations. To this end, the performance required to
ensure that all components of the internal control system
operate together in an integrated and effective manner,
under the supervision of İşbank’s Board of Directors, with
the contribution and support of all İşbank’s employees,
is being rigorously carried out with professional care and
attention.
For this purpose, “on-site” and/or “remote” controls
have been carried out by the Internal Control Division
with a risk-oriented approach on the activities of the
Bank’s domestic and foreign branches and Head Office
units, financial reporting and information systems, and
internal control structures of the subsidiaries subject to
consolidation.
Activities for central and continuous monitoring of
the effectiveness of controls by using advanced data
analytics applications were conducted.
Besides being the "Compliance Officer" of the Bank,
the Head of the Corporate Compliance Division is also
a member of the Risk Committee and Operational Risk
Committee and a consultant member of the ISSteering
Committee, Business and ISContinuity Committee,
Information Security Committee, and Information Sharing
Committee.
The Bank also oversees the effective execution of the
corporate compliance activities of its subsidiaries. The
necessary researching, analyzing, monitoring, assessing,
informing, conducting, coordinating and reporting activities
regarding compliance issues are conducted within the
Corporate Compliance Division, which consists of three
sub-units, namely Regulatory Compliance, Fiscal Crimes,
and Sanctions and International Obligations.
The duties and responsibilities of the Compliance Officer as
specified in the Law on Prevention of Laundering Proceeds
of Crime and other applicable regulations are fulfilled by
the Head of the Corporate Compliance Division, who is
the legal "Compliance Officer" of İşbank as well. The Head
of the Corporate Compliance Division also serves as the
"Compliance Officer" of the Financial Group, the parent
company of which is the Bank, in accordance with MASAK
(Financial Crimes Investigation Board) regulations.
Activities regarding the prevention of financial crimes
and sanctions at İşbank are executed in a purposeful and
effective manner in accordance with applicable regulations
and the Bank’s Policy and Compliance Program, which were
developed for this purpose.
Officers and Assistant Specialists who have just begun to
work for İşbank and employees who are promoted receive
a “Policy for Combating Financial Crimes and Sanctions
and Compliance Program” class as part of their career
training program. In addition, the Corporate Compliance
Division shares information on Financial Crimes, Sanctions,
International Obligations and Legal Compliance activities
under the Career as a Specialist Internship Program
designed to support the career growth of Senior Assistant
Specialists at the Bank. In addition to these trainings, all
employees who are expected to have knowledge on the
subject due to their duties at the Bank are provided with an
e-training titled “Combating Financial Crimes”. In addition,
orientation training is provided to employees of overseas
organizations, and lectures on Combating Financial Crimes
and International Sanctions are given to the members of the
Board of Inspectors within the III. Term Training Program.
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The results of the reviews were analyzed by the Internal
Control Division, and developing proposals, monitoring
and follow-up activities intended for eliminating the
existing deficiencies and preventing the recurrence of
the defects were continued.
In order to contribute to their professional development,
İşbank’s internal control personnel were provided with
various trainings throughout the year. The Internal
Control Division also supported the trainings given to
İşbank’s employees in order to increase the awareness of
internal control activities across the organization.
In 2022, in accordance with İşbank’s Sustainability
Policy, control activities regarding the operations carried
out within the scope of the Sustainability Management
System were conducted. The "internal audit" activities
defined within the scope of ISO 14001 - Environmental
Management System are carried out by the Internal
Control Division.
İşbank’s internal control system and internal control
activities are structured and operated to make sure that
the Bank’s assets are protected, the Bank’s activities
are carried out in compliance with the Law and other
relevant legislations, the Bank’s internal policies,
guidelines, and banking practices, accounting and
financial reporting systems function securely and in
integrity, and information is provided promptly.
The design and operational effectiveness of the internal
control activities carried out by the relevant units in the
process is regularly examined by the Internal Control
Division, which is an independent function. In the
inspections conducted by the Internal Control Division in
2022, no significant disruption was found in the internal
controls in place to ensure the effective, reliable, and
uninterrupted execution of the Bank’s activities and
services, as well as the integrity, consistency, reliability,
timely availability, and security of the information
provided by the accounting and financial reporting
system.
Efficient Risk Management
At İşbank, the risk management process puts "good
corporate governance" to the forefront and ensures
the segregation of units responsible for monitoring and
controlling risk from executive functions, identifies risks in
accordance with international regulations and facilitates
measurement, analysis, monitoring, reporting and control
functions.
The risks to which the Bank is exposed are managed
with a triple defense line. The first line of defense is
comprised of the executive units and is responsible for
identifying and assessing risks, ensuring continuous
implementation of risk management, designing and
putting process controls in place, and reporting results
according to the Bank's risk appetite, rules, procedures
and risk strategies. The second line of defense is
comprised of the Risk Management Division, Corporate
Compliance Division and Internal Control Division, which
report to the Board of Directors. The Risk Management
Division is responsible for creating the risk policies and
risk catalogue and updating them as necessary, setting
and updating control targets for the risks, measuring,
monitoring and reporting the risks, and developing a risk
management framework. The Internal Control Division
tests the effectiveness of controls, while the Corporate
Compliance Division sets the policy for compliance risks
and establishes the principles regarding the control
targets for compliance risks. In the third line of defense,
the Board of Inspectors is responsible for conducting an
independent audit of the risk management framework
and control systems to ensure their effectiveness and
adequacy.
The Risk Committee, which was established to share
risk management principles within the Bank in order to
reflect them in decision-making and implementation
processes, is responsible for articulating the risk
management strategies and policies of the Bank on a
consolidated and unconsolidated basis, submitting them
to the Board of Directors for approval and monitoring
their implementation. Furthermore, the Operational Risk
Committee operates to improve the operational risk
management framework and strengthen the governance
model regarding operational risks.
Financial Risks
Non Financial Risks
Credit
Risk
Assets /
Liability
Management
Risk
Business
Risk
Other
Risks
Operational
Risk
Reputational
Risk
Strategic Risk
Counterparty
Risk
Market
Risk
Insurance Risk
Fraud Risk
Transaction,
Process
and Product
Risk
Macro
economic/
Systemic Risks
Legal and
Regulatory
Change Risk
Credit
Concentration
Risk
Structural
Interest Rate
Risk
Settlement
Risk
Liquidity
Risk
Country
Risk
Investment
Risk
Residual
Risk
Securitization Risk
Financial Crime
Risk
Human
Resources Risk
Business
Strategy Risk
Environmental
Risks
Conduct
Risk
Physical
Damage Risk
Political Risk
Talent
Management
Risk
Compliance
Risk
Information
Technologies
Risks and
Cyber Risks
Climate
Change Risk
New Technology/
Digitalization Risk
Model
Risk
Competition
Environment
Risk
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İşbank 2022 Integrated Annual Report 159
The Bank's risk management practices are intended to
create a common risk culture across the organization.
Risk management activities are based on the regulations
and good practices guidelines published by the
Banking Regulation and Supervision Agency (BRSA).
Besides compliance with regulatory limits, the Bank also
ensures capital and liquidity adequacy against all risks
undertaken by the Bank as part of the Internal Capital
Adequacy Assessment Process (ICAAP).
The Risk Management Division, which is the main
executing body of central risk management activities
at the Bank, carries out activities related to regulatory
and internal capital adequacy to ensure compliance
with the Basel framework and international best
practices, develops and validates risk measurement
methodologies, and optimizes the capital adequacy
management process. The Bank’s level of risk exposure
is systematically monitored in accordance with the
written risk policies and implementation procedures.
The Bank runs the risk management process as per
internal regulations approved by the Board of Directors,
including Capital Adequacy, Credit Risk, Asset-Liability
Management Risk, Operational Risk, Model Risk,
Climate Change Risk, Stress Testing, Reputational
Risk, Consolidated Risk and Information Systems
Management Policies.
The Bank uses impact-probability analysis, loss event
data analysis, scenario analysis, stress testing and risk
indicators in addition to the prioritization of risk in the
measurements related to operational risks. The risks
which are defined in the Risk Catalogue and for which
the management principles are explained in detail in the
risk policies are reviewed annually, as a minimum, and the
related definitions and principles are kept up-to-date.
In order to manage the Bank's risk profile and conduct
a prospective assessment of it, the scenario analysis
method is used to assess the impact on conjectural
but unexpected operational risk-type loss events. The
scenario analysis allows assessment of catastrophic
events which are also referred to as tail risks and
rarely occur but create a high impact when they do
occur. Scenario analysis results provide inputs to
the operational risk management stress testing and
top-down risk assessment studies in addition to the
operational risk internal capital requirement.
İşbank has defined numerous risk management policies
for various risk types.
Management of Non-financial Risks
Besides financial risks, non-financial risks such as
climate change risk, environmental management risk,
internal behavior/culture and ethics risks, and employee
practice and employee relations risks are defined in
the Bank's risk catalogue and consideredas part of risk
management activities.
Introducing best practices in the management of climate
change risks is a priority for İşbank. The Bank carried out
project activities aimed at measuring and reporting the
climate change risks to which it may be exposed and
developing the principles and procedures of governance
and integrating such risks into the Bank's strategy and
loan processes. The climate change risk, positioned as a
strategic risk in the Bank's risk catalogue, is defined and
exemplified according to TCFD and international best
practices to include transition risks and physical risks.
The Climate Change Risk Policy, which was approved
and put into force by the Board of Directors, sets out the
principles and procedures to be followed for detecting,
identifying, assessing and/or measuring, monitoring,
controlling, reporting and managing the climate change
risks that the Bank may be exposed to in connection
with its activities. The "Share of Sectors With High
Climate Change Risk Within Total Commercial Portfolio"
indicator is monitored within the framework of the Bank's
solo risk appetite in order to prevent an increase in the
concentration of sectors with a high exposure to climate
change risk within the portfolio and to provide guidance
for composition of the portfolio in subsequent periods.
The Bank utilizes a scenario approach in measuring
climate change risks. For high-risk sectors, which are
identified with the climate change heat map method, an
impact analysis for climate risk events is conducted by
taking into account the scenario analysis approach of the
United Nations Environment Program - Finance Initiative
(UNEP-FI), and NGFS reference scenarios.
Reputational risk refers to potential losses which may
be caused by loss of trust in the Bank or damage to
the Bank’s reputation as a result of non-compliance
with existing legal regulations or negative views of
parties such as current or potential customers, partners,
competitors and supervisory authorities. The Bank
uses the Reputation Index to monitor reputational risk.
This index was created by the Bank to serve as an early
warning for elements which might potentially impact
the Bank's reputation. Assessments of the level of
reputational risk are reported to senior management
on a quarterly basis as a minimum. It is the senior
management's responsibility to monitor and improve
compliance with the corporate governance concept,
which constitutes the basis of reputational risk.
İşbank Risk Management Policies
Capital Adequacy Policy
Operational Risk Policy
Stress Testing Policy
Information Systems Risk Management Policy
Consolidated Risk Policies
Asset and Liability Management Risk Policy
For Information
on Risk Management
Policies Applied per
Risk Types, see page
149.
Climate Change Risk Policy
Reputational Risk Policy
Credit Risk Policy
Model Risk Management Policy
Ersin Önder Çiftçioğlu
Board Member and Audit
Committee Member
Yusuf Ziya Toprak
Vice Chairperson of the
Board of Directors and Audit
Committee Chairperson
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İşbank 2022 Integrated Annual Report 161
Business Ethics
Anti-Bribery and Anti-Corruption
İşbank established the “Ethical Principles and
Operational Rules” in line with the Principles of Banking
Ethics of the Banks Association. İşbank’s Collective
Bargaining Agreement and the Bank's legislation
also include regulations on employees and working
life. Additionally, İşbank's "Human Rights and Human
Resources Policy" includes provisions that refer to ethical
principles.
There is an ethics hotline to allow employees, customers,
and other related parties to report any violation of
operational rules to the related units of the Bank in
accordance with the Ethical Principles and Operational
Rules. In 2022, the Ethics Hotline received a total of
4 complaints. Reports and notifications regarding
bribery, corruption and other similar actions submitted
through the Ethics Hotline are monitored by the Board of
Inspectors.
For behaviors that are found to be in violation of the
Bank's policies, the necessary disciplinary action, up
to termination of the employment contract, is taken
according to the applicable provisions and procedures of
the Collective Labor Agreement.
Customer complaints can be conveyed via e-mail,
petition, or fax to digital channels, Branches, or directly to
the Head Office or the Board of Inspectors. Complaints
submitted by customers to Branches and the Head
Office units are transferred to the Customer Relations
Platform and followed up on the relevant platform.
With a special application specifically designed for all
employees, complaints can be directly submitted to the
Head Office, which then transfers them to the Board of
Inspectors for evaluation as necessary.
During the training, Intern Assistant Inspectors receive
a one-hour “Ethical Principles” and “Anti-Bribery
and Anti-Corruption” training. The topic of "Ethical
Principles" is also covered as part of a one-hour class
during the "Branch Managers Development Program",
"My Management Career”, and "As I Rise in My Career"
trainings given to managers and manager candidates.
In 2022, 1,480 hours of ethical training was given to
2,700 employees.
The “Internal Audit” training provided by the Board of
Inspectors as part of the Branch Managers Development
Program covers ethical banking principles. In addition,
in the seminars “Sexism Behind Politeness: Culture and
Language”, “Sustainability through the Lens of Gender
Equality”, and “Law Against Violence: Empowerment
Through Rights” held within the scope of Management
Development Conferences, information on basic human
rights from the perspective of related topics was shared.
Private security officers are informed about individual
rights in the “Law on Private Security Services and
Individual Rights” course, which is delivered as part
of their refresher training. In 2022, 191 employees
participated in Private Security Refresher trainings. In
addition, in 2022, the Bank’s “Human Rights and Human
Resources Policy” text was sent by the Support Services
Division to all private security officers via e-mail for their
information.
In the “Getting to Know Our Bank” course delivered as
part of the “Starting My Career” trainings organized for
new employees at İşbank, the principles set out in the
Bank’s Human Rights and Human Resources Policy
are addressed. During the “Getting to Know Our Bank”
course within the scope of “Starting My Career” trainings
provided to new employees at İşbank, the requirement
to act according to the discipline regulations and the
"Ethical Banking Principles" is emphasized. In the career
training programs organized for employees promoted
to Senior and Assistant Manager positions, the Board of
Inspectors also provides information on this subject.
In the "Banking Law" class included in the Career as a
Specialist training for Senior Assistant Specialists and
the career training programs for employees promoted to
Supervisorand Assistant Manager roles, information is
provided on the ethical principles that bank employees
are obliged to comply with.
The “Ethical Principles and Operational Rules” digital
training was made available to employees. The training
included detailed information on the Bank’s ethical
principles and operational rules, our quality, compliance
and risk policies, the principles on Combating Financial
Crimes and implementation of Sanctions, Compliance
with Competition Law and ensuring Information Security,
and information on the “Ethics Hotline” where employees
can report any violations or suspected violations of
ethical principles.
Anti-bribery and anti-corruption is an uncompromised
priority of İşbank’s banking approach.
Bribery and corruption risk is defined as the risk that the
Bank will incur losses due to an employee of the Bank
abusing the power vested in them as part of their role at
the Bank in order to, directly or indirectly, secure benefits
for themselves or third parties and failing to comply
with the anti-bribery and anti-corruption laws and
internal regulations. Measuring and prioritizing bribery
and corruption risk is done through a top-down risk
assessment, impact-probability analysis, loss event data
analysis and scenario analysis activities.
During routine audits conducted by the Board of
Inspectors according to Internal Audit Standards, all
risks, including anti-bribery and anti-corruption, are
addressed on a periodic basis, and the audit results
are reported to authorized divisions of the Bank in
accordance with the provisions of applicable legislation,
and the outcomes of the reported findings are monitored.
Besides existing risks, factors that present potential risks
are also identified, appropriate solutions are proposed,
and the entire process is monitored. If any violation of
anti-corruption policies is detected during the audits,
appropriate action is taken according to the internal
discipline regulations and legal regulations.
All findings, reports and customer complaints related
to corruption practices are meticulously handled and
thoroughly investigated. At the end of audits, the reports
prepared to allow necessary administrative decisions
to be made in accordance with the Bank's collective
labor agreement and the legislation are transferred to
the related Head Office Divisions for action. In 2022, the
scale of activities evaluated in relation to corruption risks
was found to be at a negligible level compared to the
total assets of the Bank.
İşbank’s guiding policies on anti-corruption are the
“Ethical Principles and Operational Rules” and the
“Anti-Bribery and Anti-Corruption Policy”. İşbank’s
"Anti-Bribery and Anti-Corruption Policy”, which is
the reference document for combating bribery and
corruption at the Bank, was publicly disclosed on
the corporate website. The Anti-Bribery and Anti-
Corruption Policy is implemented by the relevant Head
Office Division under the supervision of the Corporate
Governance Committee. Compliance with the provisions
of this policy is audited within the scope of internal audit.
The principles regarding fulfillment of the action plans to
resolve audit findings are determined by the Corporate
Governance Committee.
For behaviors that are found to be in violation of the
Bank's policies, the necessary disciplinary action, up
to termination of the employment contract, is taken
according to the Human Resources Regulation and
applicable provisions and procedures of the Collective
Labor Agreement. Where circumstances warrant legal
action, the violation is brought to the attention of legal
authorities.
The content of the e-training "Policy for Combating
Financial Crimes and Sanctions Compliance Program”,
which is assigned to all employees as a legal compliance
training, is determined by the Corporate Governance
Division and updated regularly and covers information
about the topic of "Anti-Bribery and Anti-Corruption”.
Regular communication is carried out to ensure
completion of this training by the employees.
During the "Getting to Know Our Bank" course within the
scope of "Starting My Career" trainings provided to new
employees at İşbank, the requirement to act according
to the discipline regulations and the "Ethical Banking
Principles" is emphasized. This topic is also covered
during the "Policy for Combating Financial Crimes and
Sanctions and Compliance Program" class for our
Officers and Assistant Specialists which is included in
the same training program.
With the "Banking Law" class included in the Career as
a Specialist training for Senior Assistant Specialists and
the career training programs for employees promoted
to Supervisorand Assistant Manager roles, information
is provided about the legal regulations concerning
corruption and other similar crimes.
The sensitivities specified in the Anti-Bribery and
Anti-Corruption Policy on the home page of İşbank’s
purchasing platform are also observed in supplier
selection. In the reporting period, no supplier was found
to be involved in bribery and corruption incidents.
Click here for İşbank’s Ethıcal Prıncıples
And Code Of Conduct.
Click here for İşbank’s Anti-Bribery and
Anti-Corruption Policy.
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İşbank 2022 Integrated Annual Report 163
Corporate Governance Principles Compliance Statement
İşbank is subject to the provisions stipulated for banks in the Banking legislation and Capital Markets legislation regarding Corporate Governance Principles. The
Bank carries out its activities in accordance with the compulsory principles of the Communiqué on Corporate Governance (Communiqué) published by the Capital
Markets Board.
The Bank’s practices regarding the non-compulsory provisions of the principles stipulated in the Communiqué and additional information within the framework
of Corporate Governance are included in the Corporate Governance Compliance Report and Corporate Governance Information Form, which are part of the
Integrated Annual Report which is published with the approval of our Board of Directors. No changes are foreseen to be performed in the Bank’s managerial
practices within the framework of the principles stipulated in the Communiqué. Within the year, efforts to develop the practices of the corporate governance
principles of the Bank have continued.
The “Sustainability Principles Compliance Framework” section of our Integrated Annual Report includes the Bank’s practices and information regarding the
principles within the scope of the regulation with the same title published by the Capital Markets Board.
Corporate Governance Compliance Report
Company Compliance Status
Yes
Partial
No
Exempted Not Applicable
Explanation
Corporate Governance Compliance Report
1.1. FACILITATING THE EXERCISE OF SHAREHOLDER RIGHTS
x
X
X
X
X
X
X
1.1.2- Up-to-date information and disclosures which may
affect the exercise of shareholder rights are available to
investors at the corporate website.
1.2. RIGHT TO OBTAIN AND REVIEW INFORMATION
1.2.1 - Management did not enter into any transaction
that would complicate the conduct of special audit.
1.3. GENERAL ASSEMBLY
1.3.2 - The company ensures the clarity of the General
Assembly agenda, and that an item on the agenda does
not cover multiple topics.
1.3.7- Insiders with privileged information have informed
the board of directors about transactions conducted on
their behalf within the scope of the company's activities
in order for these transactions to be presented at the
General Shareholders' Meeting.
1.3.8 - Members of the board of directors who are
concerned with specific agenda items, auditors, and other
related persons, as well as the officers who are responsible
for the preparation of the financial statements were
present at the General Shareholders' Meeting.
1.3.10 - The agenda of the General Shareholders'
Meeting included a separate item detailing the amounts
and beneficiaries of all donations and contributions.
1.3.11 - The General Shareholders' Meeting was held open
to the public, including the stakeholders, without having the
right to speak.
1.4. VOTING RIGHTS
1.4.1 - There is no restriction preventing shareholders
from exercising their shareholder rights.
1.4.2 - The company does not have shares that carry
privileged voting rights.
1.4.3-The company withholds from exercising its voting
rights at the General Shareholders' Meeting of any
company with which it has cross-ownership, in case
such cross-ownership provides management control.
1.5. MINORITY RIGHTS
1.5.1 - The company pays maximum diligence to the
exercise of minority rights.
1.5.2 - The Articles of Association extend the use
of minority rights to those who own less than one
twenthieth of the outstanding shares, and expand the
scope of the minority rights.
1.6. DIVIDEND RIGHT
1.6.1 - The dividend policy approved by the General
Shareholders' Meeting is posted on the company website.
X
X
In addition to the shareholders of İşbank, the persons mentioned in
"İşbank Internal Directive on Working Principles and Procedures of
General Assembly" may attend the General Assembly
X
X
X
X
In our Bank, minority rights are exercised in line with the related
legislation.
Company Compliance Status
Yes
Partial
No
Exempted Not Applicable
Explanation
X
1.6.2 - The dividend distribution policy comprises the
minimum information to ensure that the shareholders
can have an opinion on the procedure and principles of
dividend distributions in the future.
1.6.3 - The reasons for retaining earnings, and their
allocations, are stated in the relevant agenda item.
1.6.4 - The board reviewed whether the dividend policy
balances the benefits of the shareholders and those of
the company.
1.7. TRANSFER OF SHARES
1.7.1 - There are no restrictions preventing shares from
being transferred.
2.1. CORPORATE WEBSITE
2.1.1. - The company website includes all elements listed
in Corporate Governance Principle 2.1.1.
2.1.2 - The shareholding structure (names, privileges,
number and ratio of shares, and beneficial owners of
more than 5% of the issued share capital) is updated on
the website at least every 6 months.
2.1.4 - The company website is prepared in other
selected foreign languages, in a way to present exactly
the same information with the Turkish content.
2.2. ANNUAL REPORT
2.2.1 - The board of directors ensures that the annual
report represents a true and complete view of the
company's activities.
2.2.2 - The annual report includes all elements listed in
Corporate Governance Principle 2.2.2.
3.1. CORPORATION'S POLICY ON STAKEHOLDERS
3.1.1- The rights of the stakeholders are protected pursuant to
the relevant regulations, contracts and within the framework
of bona fides principles.
3.1.3 - Policies or procedures addressing stakeholders'
rights are published on the company's website.
3.1.4 - A whistleblowing programme is in place for
reporting legal and ethical issues.
3.1.5 - The company addresses conflicts of interest
among stakeholders in a balanced manner.
X
X
X
X
X
X
X
X
X
X
X
X
3.2. SUPPORTING THE PARTICIPATION OF THE STAKEHOLDERS IN THE CORPORATION'S MANAGEMENT
X
İşbank employees participate in the management of the Bank via
their beneficiary status in İşbank Members' Supplementary Pension
Fund, which holds 37.31% of İşbank shares.
3.2.1 - The Articles of Association, or the internal
regulations (terms of reference/manuals), regulate the
participation of employees in management.
3.2.2 - Surveys/other research techniques, consultation,
interviews, observation method etc. were conducted
to obtain opinions from stakeholders on decisions that
significantly affect them.
3.3. HUMAN RESOURCES POLICY
3.3.1 - The company has adopted an employment policy
ensuring equal opportunities, and a succession plan for
all key managerial positions.
3.3.2 - Recruitment criteria are documented.
3.3.3 - The company has a policy on human resources
development, and organises trainings for employees.
3.3.4 - Meetings have been organised to inform
employees on the financial status of the company,
remuneration, career planning, education and health.
3.3.5 - Employees, or their representatives, were notified
of decisions impacting them. The opinion of the related
trade unions was also taken.
3.3.6 - Job descriptions and performance criteria have
been prepared for all employees, announced to them and
taken into account to determine employee remuneration.
X
X
X
X
X
X
X
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İşbank 2022 Integrated Annual Report 165
Company Compliance Status
Company Compliance Status
Yes
Partial
No
Exempted Not Applicable
Explanation
Yes
Partial
No
Exempted Not Applicable
Explanation
3.3.7 - Measures (procedures, trainings, raising
awareness, goals, monitoring, complaint mechanisms)
have been taken to prevent discrimination, and to protect
employees against any physical, mental, and emotional
mistreatment.
3.3.8 - The company ensures freedom of association
and supports the right for collective bargaining.
3.3.9 - A safe working environment for employees is
maintained.
3.4. RELATIONS WITH CUSTOMERS AND SUPPLIERS
3.4.1-The company measured its customer satisfaction,
and operated to ensure full customer satisfaction.
3.4.2 - Customers are notified of any delays in handling
their requests.
3.4.3 - The company complied with the quality standards
with respect to its products and services.
3.4.4 - The company has in place adequate controls to
protect the confidentiality of sensitive information and
business secrets of its customers and suppliers.
3.5. ETHICAL RULES AND SOCIAL RESPONSIBILITY
3.5.1 - The board of the corporation has adopted a code
of ethics, disclosed on the corporate website.
3.5.2-The company has been mindful of its social
responsibility and has adopted measures to prevent
corruption and bribery.
4.1. ROLE OF THE BOARD OF DIRECTORS
4.1.1 - The board of directors has ensured strategy
and risks do not threaten the long-term interests of the
company, and that effective risk management is in place.
4.1.2 - The agenda and minutes of board meetings
indicate that the board of directors discussed and
approved strategy, ensured resources were adequately
allocated, and monitored company and management
performance.
4.2. ACTIVITIES OF THE BOARD OF DIRECTORS
4.2.1-The board of directors documented its meetings
and reported its activities to the shareholders.
4.2.2 - Duties and authorities of the members of the
board of directors are disclosed in the annual report.
4.2.3-The board has ensured the company has an
internal control framework adequate for its activities, size
and complexity.
4.2.4 - Information on the functioning and effectiveness
of the internal control system is provided in the annual
report.
4.2.5 - The roles of the Chairman and Chief Executive
Officer are separated and defined.
4.2.7-The board of directors ensures that the Investor
Relations department and the corporate governance
committee work effectively. The board works closely with
them when communicating and settling disputes with
shareholders.
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
4.2.8 - The company has subscribed to a Directors and
Officers liability insurance covering more than 25% of
the capital.
X
Our Bank’s Board of Directors and Executives are insured against the
risk of loss they may cause due to their faults while performing their
duties within the scope of a liability insurance policy that names our
Bank and our participations as the insured, however, the coverage of
insurance is below the mentioned amount.
4.3. STRUCTURE OF THE BOARD OF DIRECTORS
4.3.9 - The board of directors has approved the policy
on its own composition, setting a minimal target of
25% for female directors. The board annually evaluates
its composition and nominates directors so as to be
compliant with the policy.
4.3.10 - At least one member of the audit committee has
5 years of experience in audit/accounting and finance.
4.4. BOARD MEETING PROCEDURES
4.4.1-Each board member attend the majority of the
board meetings in person or via an electronic board
meeting system
4.4.2 - The board has formally approved a minimum
time by which information and documents relevant to the
agenda items should be supplied to all board members.
4.4.3 - The opinions of board members that could not
attend the meeting, but did submit their opinion in written
format, were presented to other members.
4.4.4 - Each member of the board has one vote.
4.4.5 - The board has a charter/written internal rules
defining the meeting procedures of the board.
4.4.6 - Board minutes document that all items on the
agenda are discussed, and board resolutions include
director's dissenting opinions if any.
X
X
X
X
X
X
X
4.4.7-There are limits to external commitments of board
members. Shareholders are informed of board members'
external commitments at the General Shareholders'
Meeting.
4.5. BOARD COMMITTEES
4.5.5 - Board members serve in only one of the Board's
committees.
4.5.6 - Committees have invited persons to the meetings
as deemed necessary to obtain their views.
X
4.5.7 - If external consultancy services are used, the
independence of the provider is stated in the annual
report.
4.5.8 - Minutes of all committee meetings are kept and
reported to board members.
4.6. FINANCIAL RIGHTS
4.6.1-The board of directors has conducted a board
performance evaluation to review whether it has
discharged all its responsibilities effectively.
4.6.4-The company did not extend any loans to its
board directors or executives, nor extended their lending
period or enhanced the amount of those loans, or
improve conditions thereon, and did not extend loans
under a personal credit title by third parties or provided
guarantees such as surety in favour of them.
X
X
4.6.5 - The individual remuneration of board members
and executives is disclosed in the annual report.
X
X
X
X
X
X
The duties that İşbank Board members have outside the Bank are
provided in the Annual Report which is presented in the General
Assembly.
Members of İşbank Board of Directors may take part in more than
one committee within the context of the related legislation.
Restrictions related with the loans to be extended by İşbank to the
Board members and employees are defined in article 50 of the
Banking Law. In this context, İşbank does not extend loans to its
Board members and employees other than those allowed by the law.
Total compensation of the Board members and managers with
administrative responsibilities is disclosed. On the other hand, the net
allowance amount paid to our Board members on an individual basis
is determined at our General Assemblies and disclosed to the public
together with the General Assembly minutes.
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İşbank 2022 Integrated Annual Report 167
Corporate Governance Information Form
1. SHAREHOLDERS
1.1. Facilitating the Exercise of Shareholders Rights
The number of investor meetings (conference, seminar/etc.) organised by
the company during the year
In 2022, İşbank participated 9 conferences online for stock and bond
investors. In these events, a total of 127 meetings were conducted. In
addition to 4 investor events in teleconference and videoconference
format, where investors participated via remote access, 111 meetings were
held.
1.2. Right to Obtain and Examine Information
The number of special audit request(s)
The number of special audit requests that were accepted at the General
Shareholders' Meeting
1.3. General Assembly
-
-
Link to the PDP announcement that demonstrates the information
requested by Principle 1.3.1. (a-d)
www.kap.org.tr/tr/Bildirim/914649
Whether the company provides materials for the General Shareholders'
Meeting in English and Turkish at the same time
General Assembly documents except the list of participants and the
minutes of the meeting (invitation to the General Assembly, agenda, proxy
statement, information document, dividend distribution proposal, etc.) are
presented in Turkish and English simultaneously.
The links to the PDP announcements associated with the transactions
that are not approved by the majority of independent directors or by
unanimous votes of present board members in the context of Principle
1.3.9
The links to the PDP announcements associated with related party
transactions in the context of Article 9 of the Communique on Corporate
Governance (II-17.1)
The links to the PDP announcements associated with common and
continuous transactions in the context of Article 10 of the Communique
on Corporate Governance (II-17.1)
-
-
-
The name of the section on the corporate website that demonstrates the
donation policy of the company
İşbank Donation and Contribution Principles can be found on İşbank
website, Home Page > About Us > Investor Relations > Corporate
Governance > İşbank Donation and Contribution Principles.
The relevant link to the PDP with minute of the General Shareholders'
Meeting where the donation policy has been approved
https://www.kap.org.tr/tr/Bildirim/270320
The number of the provisions of the articles of association that discuss
the participation of stakeholders to the General Shareholders' Meeting
Article 47
Identified stakeholder groups that participated in the General
Shareholders' Meeting, if any
Shareholders and shareholder representatives as well as Board members,
independent auditor representatives and İşbank employees (within the
context of the legislation) participated in the General Assembly held in
2022.
1.4. Voting Rights
Whether the shares of the company have differential voting rights
No
In case that there are voting privileges, indicate the owner and percentage
of the voting majority of shares.
-
The percentage of ownership of the largest shareholder
37,31%
1.5. Minority Rights
Whether the scope of minority rights enlarged (in terms of content or the
ratio) in the articles of the association
If yes, specify the relevant provision of the articles of association.
No
-
1.6. Dividend Right
The name of the section on the corporate website that describes the
dividend distribution policy
Home Page >About Us > Investor Relations > Corporate Governance >
Dividend Distribution Policy
Minutes of the relevant agenda item in case the board of directors
proposed to the general assembly not to distribute dividends, the reason
for such proposal and information as to use of the dividend.
PDP link to the related general shareholder meeting minutes in case the
board of directors proposed to the general assembly not to distribute
dividends
-
-
General Assembly Meetings
General Meeting Date
25.03.2022
The number of information requests received by the company regarding
the clarification of the agenda of the General Shareholders' Meeting
0,00%
Shareholder participation rate to the General Shareholders' Meeting
81,02%
Percentage of shares directly present at the GSM
Percentage of shares represented by proxy
0,04%
80,98%
Specify the name of the page of the corporate website that contains
the General Shareholders' Meeting minutes, and also indicates for each
resolution the voting levels for or against
Specify the name of the page of the corporate website that contains all
questions asked in the general assembly meeting and all responses to
them
Home > About Us > Investor Relations > Corporate Governance >
Resolutions Made at the Annual General Meeting
Home > About Us > Investor Relations > Corporate Governance >
Resolutions Made at the Annual General Meeting
The number of the relevant item or paragraph of General Shareholders'
Meeting minutes in relation to related party transactions
-
The number of declarations by insiders received by the board of directors 858
The link to the related PDP general shareholder meeting notification
https://www.kap.org.tr/tr/Bildirim/ 1014714-1013992- 1013298-
1004842- 1004917-1013298-1013992-1014714
2. DISCLOSURE AND TRANSPARENCY
2.1. Corporate Website
Specify the name of the sections of the website providing the information
requested by the Principle 2.1.1.
Home Page > About Us > Investor Relations
If applicable, specify the name of the sections of the website providing
the list of shareholders (ultimate beneficiaries) who directly or indirectly
own more than 5% of the shares.
Home > About Us > Investor Relations > Corporate Overview > Corporate
Information > Ownership Structure
List of languages for which the website is available
Turkish and English
2.2. Annual Report
The page numbers and/or name of the sections in the Annual Report that
demonstrate the information requested by principle 2.2.2.
a) The page numbers and/or name of the sections in the Annual Report
that demonstrate the information on the duties of the members of the
board of directors and executives conducted out of the company and
declarations on independence of board members
Additional Information Regarding the Related Legislation
b) The page numbers and/or name of the sections in the Annual Report
that demonstrate the information on committees formed within the board
structure
İşbank Committees
c) The page numbers and/or name of the sections in the Annual Report
that demonstrate the information on the number of board meetings in a
year and the attendance of the members to these meetings
Information about the Board of Directors Meetings in 2022
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 168 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 169
ç) The page numbers and/or name of the sections in the Annual Report
that demonstrate the information on amendments in the legislation which
may significantly affect the activities of the corporation
No legislation change that would significantly impact İşbank activities has
occured
d) The page numbers and/or name of the sections in the Annual Report
that demonstrate the information on significant lawsuits filed against the
corporation and the possible results thereof
Unconsolidated Financial Statements as at and for the Year Ended 31
December 2022 with Independent Audit's Report Thereon - Information
on Other Provisions
Whether the company provides an employee stock ownership
programme
(There isn't an employee stock ownership programme)
The name of the section on the corporate website that demonstrates the
human resource policy covering discrimination and mistreatments and
the measures to prevent them. Also provide a summary of relevant parts
of the human resource policy.
Home Page > About Us > Sustainability > Our Policies
e) The page numbers and/or name of the sections in the Annual Report
that demonstrate the information on the conflicts of interest of the
corporation among the institutions that it purchases services on matters
such as investment consulting and rating and the measures taken by the
corporation in order to avoid from these conflicts of interest
None
f) The page numbers and/or name of the sections in the Annual Report
that demonstrate the information on the cross ownership subsidiaries
that the direct contribution to the capital exceeds 5%
g) The page numbers and/or name of the sections in the Annual Report
that demonstrate the information on social rights and professional
training of the employees and activities of corporate social responsibility
in respect of the corporate activities that arises social and environmental
results
3. STAKEHOLDERS
3.1. Corporation’s Policy on Stakeholders
İşbank has no cross ownership subsidiaries.
Responsible Operations - Decent Work / Good Corporate Citizen -
Contribution to Social Welfare
The name of the section on the corporate website that demonstrates the
employee remedy or severance policy
Compensation principles for Bank employees are determined by the
Collective Bargaining Agreement which is shared with the employees
through İşbank's Corporate Intranet Portal.
The number of definitive convictions the company was subject to in
relation to breach of employee rights
None
The position of the person responsible for the alert mechanism (i.e.
whistleblowing mechanism)
The contact detail of the company alert mechanism
In addition to our employees, all other stakeholders can submit their
complaints to the Board of Inspectors through the channels included in
the Ethical Principles and Code of Conduct approved by the Board of
Directors of our Bank. Following detailed and independent evaluations,
complaints are directly examined by the Board of Inspectors or transferred
to the relevant units of the Bank. İşbank also has an online communication
platform through which employees may submit their requests and
complaints to the Senior Management directly. Only a limited number of
managers have access to the said platform.
E-mail: etik@isbank.com.tr Phone: +90 212 316 14 44 Address: Türkiye
İş Bankası A.Ş. Etik Hat İş Kuleleri Kule 1 Kat 34 34330 Levent-Beşiktaş/
İSTANBUL
3.2. Supporting the Participation of the Stakeholders in the Corporation’s Management
Name of the section on the corporate website that demonstrates
the internal regulation addressing the participation of employees on
management bodies
No information on this matter is available on our website.
Corporate bodies where employees are actually represented
3.3. Human Resources Policy
Isbank employees participate in the management of the Bank via their
beneficiary status in İşbank Members' Supplementary Pension Fund,
which holds 37.31% of İşbank shares.
The role of the board on developing and ensuring that the company has a
succession plan for the key management positions
Board of Directors create succession plans.
The name of the section on the corporate website that demonstrates the
human resource policy covering equal opportunities and hiring principles.
Also provide a summary of relevant parts of the human resource policy.
Home Page > About Us > Sustainability > Our Policies
The number of definitive convictions the company is subject to in relation
to health and safety measures
None
3.5. Ethical Rules and Social Responsibility
The name of the section on the corporate website that demonstrates the
code of ethics
Home Page > About Us > Investor Relations > Corporate Governance >
Ethical Principles and Code of Conduct
The name of the section on the company website that demonstrates
the corporate social responsibility report. If such a report does not exist,
provide the information about any measures taken on environmental,
social and corporate governance issues.
Home Page > About Us > Sustainability > Our Reports
Any measures combating any kind of corruption including embezzlement
and bribery
Home Page > About Us > Sustainability > Our Policies
4. BOARD OF DIRECTORS-I
4.2. Activity of the Board of Directors
Date of the last board evaluation conducted
23.11.2022
Whether the board evaluation was externally facilitated
Whether all board members released from their duties at the GSM
No
Yes
Name(s) of the board member(s) with specific delegated duties and
authorities, and descriptions of such duties
No delegation of authority in İşbank
Number of reports presented by internal auditors to the audit committee
or any relevant committee to the board
101
Specify the name of the section or page number of the annual report
that provides the summary of the review of the effectiveness of internal
controls
Audit Committee's Assessment on the Operation of Internal Audit, Internal
Control, Compliance and Risk Management Sytems and Its Activities in
the Reported Period
Name of the Chairman
Name of the CEO
Adnan Bali
Hakan Aran
If the CEO and Chair functions are combined: provide the link to the
relevant PDP annoucement providing the rationale for such combined
roles
Link to the PDP notification stating that any damage that may be caused
by the members of the board of directors during the discharge of their
duties is insured for an amount exceeding 25% of the company's capital
Chairman and General Manager seats are held by different persons
Our Banks Board of Directors and Executives are insured against the risk
of loss they may cause due to their faults while performing their duties
within the scope of a liability insurance policy that names our Bank and
our participations as the insured, however, the coverage of insurance is
below the mentioned amount. On the other hand, this issue has not been
disclosed on the Public Disclosure Platform
The name of the section on the corporate website that demonstrates
current diversity policy targeting women directors
https://www.isbank.com.tr/en/about-us/Documents/investor-relations/
board_diversity_policy.pdf
The number and ratio of female directors within the Board of Directors
1 / %9
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 170 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 171
Composition of Board of Directors
Name, Surname of
Board Member
Whether
Executive
Director Or
Not
Whether
Independent
Director Or Not
The First
Election
Date To
Board
Link To PDP
Notification That
Includes The
Independency
Declaration
Whether the
Independent Director
Considered By
The Nomination
Committee
Whether She/
He is the
Director Who
Ceased to
Satisfy The
Independence
or Not
Whether The
Director Has At
Least 5 Years’
Experience On
Audit, Accounting
And/Or Finance
Or Not
ADNAN BALİ
YUSUF ZİYA
TOPRAK
Non-
executive
Non-
executive
HAKAN ARAN
Executive
FERAY DEMİR
ERSİN ÖNDER
ÇİFTÇİOĞLU
FAZLI BULUT
DURMUŞ ÖZTEK
RECEP HAKAN
ÖZYILDIZ
MUSTAFA
RIDVAN SELÇUK
Non-
executive
Non-
executive
Non-
executive
Non-
executive
Non-
executive
Non-
executive
Not independent
director
01.04.2011
Independent
director
31.03.2020
Not independent
director
Not independent
director
01.04.2021
25.03.2016
Independent
director
31.03.2017
Not independent
director
29.03.2019
Not independent
director
31.03.2020
Not independent
director
31.03.2020
Not independent
director
31.03.2020
AHMET GÖKHAN
SUNGUR
Non-
executive
Independent
director
31.03.2020
www.kap.
org.tr/tr/
Bildirim/916723
SADRETTİN
YURTSEVER
Non-
executive
Not independent
director
31.03.2020
Not applicable
Not considered
Not applicable
Not applicable
-
No
-
-
Not considered
No
Not applicable
Not applicable
Not applicable
Not applicable
Considered
Not applicable
-
-
-
-
No
-
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
4. BOARD OF DIRECTORS-II
4.4. Meeting Procedures of the Board of Directors
Number of physical or electronic board meetings in the reporting period
9 physical, 7 online
Director average attendance rate at board meetings
98,86%
Whether the board uses an electronic portal to support its work or not
Yes
Number of minimum days ahead of the board meeting to provide
information to directors, as per the board charter
In accordance with article II/4/b of the Directive on Working Procedures
and Principles of İşbank Board of Directors, a copy of the agenda and
proposals is sent to the members before the meeting date at a reasonable
time which allows them to make the necessary evaluations.
The name of the section on the corporate website that demonstrates
information about the board charter
Articles of Association
Number of maximum external commitments for board members as per
the policy covering the number of external duties held by directors
None
4.5. Board Committees
Page numbers or section names of the annual report where information
about the board committees are presented
İşbank Committees
Link(s) to the PDP announcement(s) with the board committee charters
www.kap.org.tr/tr/Bildirim/262622
Composition of Board Committees-I
Names Of The Board
Committees
Name Of Committees Defined As "Other"
In The First Column
Name-Surname of Committee
Members
Whether Committee
Chair Or Not
Whether Board
Member Or Not
Corporate Governance
Committee
Corporate Governance
Committee
Corporate Governance
Committee
Corporate Governance
Committee
Audit Committee
Audit Committee
Remuneration Committee
Remuneration Committee
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Ersin Önder Çiftçioğlu
Feray Demir
Sadrettin Yurtsever
Neşe Gülden Sözdinler
Yusuf Ziya Toprak
Ersin Önder Çiftçioğlu
Adnan Bali
Feray Demir
Hakan Aran
Adnan Bali
Feray Demir
Yusuf Ziya Toprak (Alternate
member)
Credit Committee
Credit Committee
Credit Committee
Credit Committee
Credit Committee
Fazlı Bulut (Alternate member)
Turkish Republic of Northern Cyprus Internal
Systems Committee
Yusuf Ziya Toprak
Turkish Republic of Northern Cyprus Internal
Systems Committee
Ersin Önder Çiftçioğlu
Credit Revision Committee
Adnan Bali
Credit Revision Committee
Yusuf Ziya Toprak
Credit Revision Committee
Feray Demir
Credit Revision Committee
Ersin Önder Çiftçioğlu
Credit Revision Committee
Sadrettin Yurtsever
Corporate Social Responsibility Committee
Feray Demir
Corporate Social Responsibility Committee
Sadrettin Yurtsever
Corporate Social Responsibility Committee
Fazlı Bulut
Corporate Social Responsibility Committee
Durmuş Öztek
Corporate Social Responsibility Committee
Can Yücel
Corporate Social Responsibility Committee
Suat E. Sözen
Corporate Social Responsibility Committee
Gül Meltem Atılgan
Risk Committee
Risk Committee
Risk Committee
Risk Committee
Risk Committee
Risk Committee
Adnan Bali
Yusuf Ziya Toprak
Ersin Önder Çiftçioğlu
Hakan Aran
Ebru Özşuca
Gamze Yalçın
Yes
No
No
No
Yes
No
Yes
No
Yes
No
No
No
No
Yes
No
No
No
No
No
No
No
No
No
No
No
No
No
Yes
No
No
No
No
No
Board member
Board member
Board member
Not board member
Board member
Board member
Board member
Board member
Board member
Board member
Board member
Board member
Board member
Board member
Board member
Board member
Board member
Board member
Board member
Board member
Board member
Board member
Board member
Board member
Not board member
Not board member
Not board member
Board member
Board member
Board member
Board member
Not board member
Not board member
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 172 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 173
Names Of The Board
Committees
Name Of Committees Defined As "Other"
In The First Column
Name-Surname of Committee
Members
Whether Committee
Chair Or Not
Whether Board
Member Or Not
4. BOARD OF DIRECTORS-III
4.5. Board Committees-II
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Risk Committee
Risk Committee
Risk Committee
Risk Committee
Risk Committee
Can Yücel
Sezai Sevgin
Hürdoğan Irmak
Süleyman H. Özcan
Engin Yalçın
Operational Risk Committee
Yusuf Ziya Toprak
Operational Risk Committee
Hakan Aran
Operational Risk Committee
Ersin Önder Çiftçioğlu
Operational Risk Committee
Ozan Gürsoy
Operational Risk Committee
Mehmet Celayir
Operational Risk Committee
Sabri Gökmenler
Operational Risk Committee
Sezgin Lüle
Operational Risk Committee
Sezai Sevgin
Operational Risk Committee
Gürler Özkök
Operational Risk Committee
Süleyman H. Özcan
Operational Risk Committee
Engin Yalçın
Operational Risk Committee
Hürdoğan Irmak
Operational Risk Committee
Bülent Akdemir
Operational Risk Committee
Burcu Nasuhoğlu
No
No
No
No
No
Yes
No
No
No
No
No
No
No
No
No
No
No
No
No
Not board member
Not board member
Not board member
Not board member
Not board member
Board member
Board member
Board member
Not board member
Not board member
Not board member
Not board member
Not board member
Not board member
Not board member
Not board member
Not board member
Not board member
Not board member
Sustainability Committee
Adnan Bali
Yes
Board member
Sustainability Committee
Ersin Önder Çiftçioğlu
Sustainability Committee
Feray Demir
Sustainability Committee
Gamze Yalçın
Sustainability Committee
N. Burak Seyrek
Sustainability Committee
Ozan Gürsoy
Sustainability Committee
Sabri Gökmenler
Sustainability Committee
Sezgin Yılmaz
Sustainability Committee
Sezai Sevgin
Sustainability Committee
H. Cahit Çınar
Sustainability Committee
İzlem Erdem
Sustainability Committee
Can Yücel
Sustainability Committee
Suat E. Sözen
Sustainability Committee
Hürdoğan Irmak
Sustainability Committee
Neşe Gülden Sözdinler
Board of Directors Operating
Principles Committee
Board of Directors Operating
Principles Committee
Board of Directors Operating
Principles Committee
Adnan Bali
Feray Demir
Durmuş Öztek
No
No
No
No
No
No
No
No
No
No
No
No
No
No
Yes
No
No
Board member
Board member
Not board member
Not board member
Not board member
Not board member
Not board member
Not board member
Not board member
Not board member
Not board member
Not board member
Not board member
Not board member
Board member
Board member
Board member
Specify where the activities of the audit committee are presented in your
annual report or website (Page number or section name in the annual
report/website)
Information about the activities of Audit Committee which was established
within the context of the related legislation is presented in "İşbank
Committees" section of the Annual Report.
Specify where the activities of the corporate governance committee are
presented in your annual report or website (Page number or section name
in the annual report/website)
İşbank Committees
Specify where the activities of the nomination committee are presented
in your annual report or website (Page number or section name in the
annual report/website)
At İşbank, functions of Nomination Committee are fulfilled by Corporate
Governance Committee.
Specify where the activities of the early detection of risk committee are
presented in your annual report or website (Page number or section name
in the annual report/website)
Information about the activities of Risk Committe is presented in "İşbank
Committees" section of the Annual Report.
Specify where the activities of the remuneration committee are presented
in your annual report or website (Page number or section name in the
annual report/website)
Information about the activities of Remuneration Committe which was
established within the context of the related legislation is presented in
"İşbank Committees" section of the Annual Report.
4.6. Financial Rights
Specify where the operational and financial targets and their achievement
are presented in your annual report (Page number or section name in the
annual report)
Reliable Financial Actor, Responsible Operations
Specify the section of website where remuneration policy for executive
and non-executive directors are presented.
Home Page > About Us > Investor Relations > Corporate Governance >
Remuneration Policy
Specify where the individual remuneration for board members and senior
executives are presented in your annual report (Page number or section
name in the annual report)
Additional Information Regarding the Related Legislation
Composition of Board Committees-II
Names Of The Board
Committees
Name of committees
defined as "Other" in the
first column
The Percentage
Of Non-executive
Directors
The Number Of
Meetings Held In
Person
The Number Of Reports On
Its Activities Submitted To
The Board
The
Percentage Of
Independent
Directors
In The
Committee
25%
100%
0%
20%
100%
75%
100%
100%
80%
100%
4 online
60
8
-
12
100%
40%
3 physical, 4 online
50%
64%
64%
33%
100%
0%
18%
14%
7%
0%
2 physical, 4 online
4 physical, 7 online
2 physical
1 online
-
2
12
-
-
2
1
8
14
-
1
-
Corporate Governance
Committee
Audit Committee
Remuneration Committee
Other
Other
Other
Other
Other
Other
Other
Other
Credit Committee
Turkish Republic of
Northern Cyprus Internal
Systems Committee
Credit Revision
Committee
Corporate Social
Responsibility Committee
Risk Committee
Operational Risk
Committee
Sustainability Committee
Board of Directors
Operating Principles
Committee
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 174 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 175
Sustainability Principles Compliance Framework
COMPLIANCE STATUS
YES
NO PARTIAL IRRELEVANT
EXPLANATION
DEFINITION
A. General Principles
A1. Strategy, Policies and Targets
Material environmental, social and
corporate governance (ESG) issues, risks
and opportunities have been determined
by the partnership's Board of Directors.
ESG policies (e.g. Environmental Policy,
Energy Policy, Human Rights and
Employee Policy etc.) have been created
and disclosed to the public by the Board of
Director of the corporation
A1.1
A1.2
Short and long- term targets set within the
scope of ESG policies were disclosed to
the public.
A2. Implementation/Monitoring
The committees and/or units responsible
for the implementation of ESG policies and
the highest level officials in the partnership
related to ESG issues and their duties have
been identified and disclosed to the public.
Activities carried out within the scope
of policies by the responsible committe
and/ or unit were reported to the board of
directors at least once a year.
A2.1
A2.2
Creates and discloses implementation and
action plans aligned with ESG targets.
A2.3
The ESG Key Performance Indicators (KPI)
and the level of reaching these indicators on
a yearly basis were disclosed to the public.
A2.4
Discloses efforts for improving
sustainability performance with respect to
work processes or products and services.
A3. Reporting
A3.1
A3.2
A3.3
In the annual reports information on the
sustainability performance, goals and
actions of the partnership is given in an
understandable accurate and adequate
manner
Provides information about which of the
United Nationas (UN) 2030 Sustainable
Development Goals its activities are
related to
Makes disclosures regarding the lawsuits
filed and/ or conluded against the company
on account of ESG issues, which are
material with respect to ESG issues, which
are material with respect to ESG policies
and/or have material impact on operations
A4. Verifications
A4.1
ESG Key Performance measurements are
verified by an independent third party and
publicly disclosed.
x
x
x
x
x
x
x
x
x
x
x
x
Home Page >About Us > Sustainability > Our
Policies
Home Page >About Us > Sustainability > Our
Policies
Global Tendencies, Risks, Opportunities and
Forecasts, page 23-27
Our Business Model: İşbank Banking, page 31
Reliable Financial Actor, page 52-101
Responsible Operations, page 102-127
Good Corporate Citizen page 128-189
2022 CDP Climate Change Report, page 48-62
Home Page >About Us > Sustainability > Our
Organization
İşbank Committees, Sustainability Committee,
page 144-148
2022 CDP Climate Change Report, page 4-8
Our Business Model: İşbank Banking, page 31
Reliable Financial Actor, page 52-101
Responsible Operations, page 102-127
Good Corporate Citizen page 128-189
2022 CDP Climate Change Report, page 48-62
2022 CDP Water Security Report, page 62-65
Key Performance Indicators, page 55,77, 89,
106, 115, 131, 185
Responsible Products and Services, page 68-70
Products and Services Contributing to a Green
Economy, page 84-87
Home > About Us > Sustainability > Responsible
Products and Services > Products and Services
Contributing to Society
Global Tendencies, Risks, Opportunities and
Forecasts, page 23-27
How Do We Create Value? Sustainability at
Isbank, page 31-33
Reliable Financial Actor, page 52-101
Responsible Operations, page 102-127
Good Corporate Citizen, page 128-189
Contribution to Sustainable Development Goals,
page 50-51
https://www.kap.org.tr/en/Bildirim/1012970-
1031025-1038508- 1053513-1065379-
1070878-1102646
Non-Financial Data Reporting Guide and
Independent Assurance Report, page 450-457
COMPLIANCE STATUS
YES
NO PARTIAL IRRELEVANT
EXPLANATION
DEFINITION
B1
B2
B. Environmental Principles
Discloses its policies and practices,
action plans in relation to environmental
management systems (known by the ISO
14001 standard) and programs
Publicy discloses the limitations over
the reporting scope, reporting period,
reporting date, reporting conditions of the
environmental reports to be prepared for
providing environmental management
information.
B3
It’s stated in A2.1.
B4
Environmental targets included in scope
of performance incentive systems on the
basis of stakeholders (such as members
of the Board of Director, managers and
employees) have been disclosed to the
public.
B5
How the priority environmental issues
are integrated into business goals and
strategies has been publicly disclosed.
B6
It’s stated in A2.4
B7
B8
B9
B10
B11
B12
It has been publicly disclosed how
environmental issues are managed and
integrated into business objectives and
strategies throughout the partnership value
chain, including the operational process,
including suppliers and customers including
suppliers and customers.
Whether relevant organizations and
non- governmental organizations on the
environment are involved in
Periodically reports information about its
environmental impacts comparatively
in the light of environmental indicators;
Greenhouse gas emissions Scope-
1(Direct), Scope-2 (Indirect from
purchased energy), Scope-3 (Other
indirect), air quality, energy management,
water and wastewater management, waste
management, biodiversity implications)
Discloses the standards, protocols,
methodology and base year detailsfor
collecting and calculating its data
Discloses the status of environmental
indicators for the reporting year in
comparison with previous years (increase
or decrease)
Sets and discloses its short-term and long-
term targets for mitigating its environmental
impacts. Also provides information about
the progress achieved, if applicable, in the
reporting period with respect to the targets
it has set previously.
B13
A strategy to combat the climate crisis
has been created and the planned actions
have been publicly announced.
x
x
x
x
x
x
x
x
x
x
x
x
x
Reducing the negative impacts of our operations,
page 104-113
Home > About Us > Sustainability > Our Policies
About the Report, page 6-7
Non-Financial Data Reporting Guide and
Independent Assurance Report, page 450-457
2022 CDP Climate Change Report, page 10-11
How Do We Create Value?
Sustainability at İşbank, page 31-33
Global Tendencies, Risks, Opportunities and
Forecasts, page 23-27
Reliable Financial Actor, page 52-101
Responsible Operations, page 102-127
Good Corporate Citizen, page 128-189
2022 CDP Climate Change Report, page 35-42
Responsible Procurement, page 110-112
Home > About Us > Sustainability > Our Policies
> Supplier Code of Conduct
Initiatives Supported in the Field of Sustainability,
Page 47-49
Corporate Memberships, page 437
Home > About Us > Sustainability >
Memberships and Initiatives
Reducing the negative impacts of our operations,
page 104-113
Home > About Us > Sustainability >
Memberships and Initiatives
Reducing the negative impacts of our operations,
page 104-113
Non-Financial Data Reporting Guide and
Independent Assurance Report, page 450-457
Reducing the negative impacts of our operations,
page 104-113
Home > About Us > Sustainability > Responsible
Banking > Our Environmental Impact
2022 CDP Climate Change Report, page 69-89
Reducing the negative impacts of our operations,
page 104-113
2022 CDP Climate Change Report, page 48-62
Climate Action, page 76-87
Home > About Us > Sustainability > Responsible
Banking > Combating Climate Change
2022 CDP Climate Change Report, page 35-42
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen
176 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 177
COMPLIANCE STATUS
COMPLIANCE STATUS
YES
NO PARTIAL IRRELEVANT
EXPLANATION
DEFINITION
YES
NO PARTIAL IRRELEVANT
EXPLANATION
DEFINITION
Climate Action, page 76-87
Home > About Us > Sustainability > Responsible
Products and Services > Products Contributing to
the Green Economy
Sustainable Procurument, page 110-112
Home > About Us > Sustainability > Our Policies
> Supplier Code of Conduct
Reducing the negative impacts of our operations,
page 104-113
Reducing the negative impacts of our operations,
page 104-113
Home > About Us > Sustainability > Responsible
Banking > Our Environmental Impact
Reducing the negative impacts of our operations,
page 104-113
Home > About Us > Sustainability > Responsible
Banking > Our Environmental Impact
Reducing the negative impacts of our operations,
page 104-113
Reducing the negative impacts of our operations,
page 104-113
Home > About Us > Sustainability > Responsible
Banking > Our Environmental Impact
Reducing the negative impacts of our operations,
page 104-113
Home > About Us > Sustainability > Responsible
Banking > Our Environmental Impact
Reducing the negative impacts of our operations,
page 104-113
Home > About Us > Sustainability > Responsible
Banking > Our Environmental Impact
Non-Financial Data Reporting Guide and
Independent Assurance Report, page 450-457
2022 CDP Water Security Report, page 36-46
Programs or procedures have been
established and disclosed to the public in
order to prevent or minimize the potential
negative impact of products and/or
services on the environment.
Actions have been taken to reduce
greenhouse gas emissions of third
parties (e.g. suppliers, subcontractors,
dealers, etc.) and these actions have been
disclosed to the public.
The environmental benefits/benefits and
cost savings of initiatives and projects
aimed at reducing environmental impacts
have been disclosed to the public
Energy consumption (natural gas, diesel,
gasoline, LPG, coal, electricity, heating,
cooling, etc.) data are publicly disclosed as
Scope -1 and Scope -2.)
Public disclosure was made about the
electricity, heat, steam and cooling
produced in the reporting year.
Studies on increasing the use of renewable
energy and the transition to zero or low
carbon electricity have been made and
publicly announced.
B14
B15
B16
B17
B18
B19
Renewable energy production and usage
data is publicly disclosed.
B20
B21
Energy efficiency projects have been
carried out and the amount of energy
consumption and emission reduction
achieved through energy efficiency
projects has been disclosed to the public.
Water consumption, if any, amounts of
water drawn, recycled and discharged from
underground or above ground, its sources
and procedures have been disclosed to
the public.
x
x
x
x
x
x
x
x
x
B22
It has been publicly disclosed whether its
operations or activities are included in any
carbon pricing system (Emissions Trading
System, Cap & Trade or Carbon Tax).
x
B23
Information on carbon credits accumulated
or purchased during the reporting period
has been disclosed to the public.
x
İşbank’s operations or activities
are not included in the carbon
pricing system. It is known that
legal authorities are working
on establishing a local carbon
trading system. All national and
international developments
are followed closely and
development opportunities are
evaluated in this area
İşbank aims to reduce the
total Scope-1 and Scope-2
greenhouse gas emissions
calculated in accordance with
the International GHG Protocol
by 38% by 2025, 65% by 2030,
and to zero by 2035, and to carry
out activities as carbon-neutral as
of 2035. As of 2021, İşbank has
started to use renewable energy
in all of its operational points that
can be supplied, and has already
reached its targets for 2025 and
2030. İşbank primarily carries out
focused efforts to reduce its direct
and indirect emissions, and in the
following periods, it will also be
able to consider the purchase of
carbon credits in order to zero
the emissions.
B24
Discloses the details if carbon pricing is
applied within the Company
x
At this stage, there is no
carbon pricing practice in our
bank. On the other hand, all
activities of our Bank are in
a continuous development
with the ESG focus, and the
implementation of the carbon
pricing practice will be
evaluated in the following
period.
B25
The platforms where the partnership
discloses its environmental information are
publicly disclosed.
x
C1.1
C1.2
C1.3
C1.4
C1.5
C. Social Principles
C1. Human Rights and Employee Rights
Forms a Human Rights and Employee
Rights Policy with a commitment to fully
comply with the Universal Declaration of
Human Rights, ILO Conventions which
Turkey has confirmed and the legal
framework and regulations governing
the operation of corporate life in Turkey.
Discloses the policy in question and the
roles and responsibilities associated with
its implementation.
Incorporates equitable workforce,
improvement of working standards,
women’s employment and inclusion (Xt
discriminating on the basis of gender, race,
religion, language, marital status, ethnicity,
sexual orientation, gender identity, family
responsibilities, union activities, political
affiliation, disabilities, social and cultural
differences, etc.) in its policy concerning
employee rights, while looking out for the
effects of supply and value chain.
Describes the measures taken throughout
the value chain for the protection of
groups sensitive to certain ecoXmic,
environmental, social factors (low-income
groups, women, etc.) or securing miXrity
rights / equal opportunities.
Reports developments regarding
discrimination, inequality, human rights
violations, forced labor and corrective
practices. Explain the regulations to
prevent child labor.
Explains policies regarding investment in
employees (training, development policies),
compensation, vested benefits, right to
unionize, work / life balance solutions
and talent management. Determines
dispute resolution processes by creating
mechanisms for employee complaints and
dispute resolution. It regularly explains the
activities carried out to ensure employee
satisfaction.
Determines the dispute resolution
processes by establishing mechanisms
for employee complaints and resolution
processes.
Explains the activities to ensure employee
satisfaction within the reporting period.
x
x
x
x
x
x
x
Initiatives Supported in the Field of Sustainability,
page 47-49
2022 CDP Climate Change Report
2022 CDP Water Security Report
Our Environmental Impact | Türkiye İş Bankası
(isbank.com.tr)
Home > About Us > Sustainability > Our Policies
> Human Rights And Human Resources Policy
Home > About Us > Sustainability > Our Policies
> Human Rights And Human Resources Policy
Home > About Us > Sustainability > Our Policies
> Supplier Code Of Conduct
Home > About Us > Sustainability > Our Policies
> Gender Equality Policy
Home > About Us > Sustainability > Our Policies
> Supplier Code Of Conduct
Sustainable Procurement, page 110-112
Financial Inclusion, page 72-75
Equal Opportunity and Diversity, page 123-127
Equal Opportunity and Diversity ve Gender
Equality, page 123-127
GRI Content Index, page 458-461
Decent Work, page 114-127
Home > About Us > Investor Relations >
Corporate Governance > Remuneration Policy
Home > About Us > Investor Relations >
Corporate Governance > Ethical Principles and
Code of Conduct
Compliance with Operating Principles, page 124
Home > About Us > Investor Relations >
Corporate Governance > Ethical Principles and
Code of Conduct
Decent work, page 114-127
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen
178 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 179
COMPLIANCE STATUS
YES
NO PARTIAL IRRELEVANT
EXPLANATION
DEFINITION
Establishes and discloses occupational
health and safety policies.
C1.6
Discloses the measures taken to prevent
workplace accidents and for protecting
occupational health along with statistical
data on accidents.
C1.7
Establishes and discloses personal data
protection and data security policies.
x
x
x
C1.8
Establishes and discloses a code of ethics.
x
C1.9
Explains the work within the scope of
social investment,social responsibility,
financial inclusion and access to finance.
C1.10
Organizes information meetings and
training programs on ESG policies and
practices for employees.
x
x
C2. Stakeholders, International Standards and Initiatives
C2.1
C2.2
Establishes and discloses a customer
satisfaction policy for management and
resolution of customer complaints.
Information about the communication with
stakeholders (which stakeholder, subject
and frequency) is publicly disclosed.
C2.3
Explains the international reporting
standards adopted in its reporting.
C2.4
C2.5
D1
D2
Discloses the principles adopted regarding
sustainability, international organizations,
committees and principles that it is a
signatory or member of.
Makes improvements and conducted
studies in order to to qualify for inclusion
in sustainability indices of Borsa İstanbul
and/or international index providers.
D. Corporate Governance Principles
Seeks stakeholders’ opinions while
determining the measures and strategies
related with sustainability.
Implications on raising the awareness of
sustainability and its importance through
conducting social responsibility projects,
awareness activities and training programs.
x
x
x
x
x
x
x
Home > About Us > Sustainability > Our Policies
> Occupational Health and Safety Policy
Employee Health and Safety, page 125
Human Resources Data, page 443
Home > Privacy Policy
Home > About Us > Investor Relations >
Corporate Governance > Personal Data
Protection Policy
Home > About Us > Investor Relations >
Corporate Governance > Ethical Principles and
Code of Conduct
Contribution to Social Welfare, page 184-189
Financial Inclusion, page 72-75
Talent Management, page 126-127
Equal Opportunity and Diversity ve Gender
Equality page 123-127
Human Resources data, page 443
https://www.isbank.com.tr/en/contact-us
https://www.isbank.com.tr/en/contact-form
https://www.isbank.com.tr/iletisim-formu-takip
Client Oriented, page 65-67
Stakeholders, page 35-37
About the Report, page 6-7
Initiatives Supported in the Field of Sustainability,
page 47-49
2022 CDP Climate Change Report, page 3, 18-22
Initiatives Supported in the Field of Sustainability,
page 47-49
Sustainability Priorities, page 46
Initiatives Supported in the Field of Sustainability,
page 47-49
How Do We Create Value? Sustainability in
İşbank, page 31-33
Transparent and Ethical Management, page
130-183
2022 CDP Climate Change Report
Contribution to Social Welfare, page 184-189
Dividend Distribution Policy
The principles regarding the Bank’s dividend distribution
are regulated in Article 58 of the Articles of Incorporation.
According to this:
“After deducting all general expenses from the income
arising from the operations of the Bank within a year,
including premiums, bonuses and similar payments
to the personnel of the Bank, and funds for all kinds of
depreciations, as well as necessary provisions, the net
profit obtained shall partly be set aside as reserve fund
and partly distributed in the order, manner, and at the
rates indicated below.
a) 1- 5% to legal reserve fund,
2- 5% as provision for probable future losses,
3- 10% as first extraordinary reserve fund.
If the cause for the setting aside of a provision and fund
for a probable future loss and/or risk no longer exists, the
remainder of these accounts added to the net profit after
the allocation made in subparagraph (a) shall be added
to the first contingency reserve fund in section (a/3).
b) An amount equal to 6% of the paid-in capital
represented by Group A, B, and C shares shall be
distributed to shareholders as the "first dividend" from
the amount remaining after the reserves mentioned in
paragraph (a) above are set aside from the net profit.
Should the profit realized in any year be insufficient to
provide for the first dividend of 6% referred to above,
the balance shall be allocated and distributed from
the extraordinary reserve fund. However, the amount
allocated from the reserve fund in this way shall
constitute a debt that must be allocated from the net
profit of subsequent years.
c) After the reserved fund referred to in paragraph (a)
and the first dividend referred to in paragraph (b)
above, the balance shall be distributed as follows:
10% to the founder shares (limited to the portion of TL
250 thousand –two hundred and fifty thousand– of
paid-in capital)
20% to the employees of the Bank, and
10% shall be set aside as the second extraordinary
reserve fund.
d) After the amounts set forth in paragraphs (a), (b)
and (c) have been set aside and distributed, the
balance remaining by considering paragraph (e)
shall be distributed to the shareholders as a “second
dividend” in the manner stated below.
1- The net total of the dividends to be distributed to
the holders of Group A shares as first and second
dividends under paragraphs (b) and (d) may not
exceed 60% of the capital paid up by them, the net
total of the dividends to be distributed to holders of
Group B shares may not exceed 30% of the capital
paid up by them, and the net total of the dividends to
be distributed to holders of Group C shares may not
exceed 25% of the capital paid up by them.
2- After the amounts set forth in paragraphs (a), (b)
and (c) have been set aside and distributed, should
the balance be insufficient to distribute the second
dividend in the manner specified by the paragraph
(1) above, total dividends to be paid to the three
Groups of shares shall be calculated separately in the
distribution of the second dividend by considering
twice the amount of the paid-in capital represented
by Group A shares, the full amount of the paid-in
capital represented by Group B shares, and 5/6 (five-
sixths) of the amount of paid-in capital represented
by Group C shares.
e) The amount that needs to be added to the statutory
reserve under paragraph 2/c of Article 519 of the
Turkish Commercial Code shall be set aside.
f) The General Assembly shall, upon proposal of the
Board of Directors, decide whether the balance
remaining after the distribution and allocation of the
net profit as specified above shall be transferred
to the extraordinary reserve funds, carried over to
the following year, or up to 80% of such balance be
distributed in net to the shareholders by dividing the
same by the number of shares and the remaining
balance be transferred to the extraordinary reserve
funds or carried over to the following year. In the
calculation of the dividends to be paid to all three
Groups of shares; Group A shares will be considered
as 40 times the share quantity, Group B shares will
be considered as 1.5 times of the share quantity,
and Group C shares will be considered as the same
quantity due to the reason that 20 shares each with
a nominal value of TL 500 (this amount is related
to the period prior to the Law No. 5083 regarding
the Monetary Unit of the Turkish Republic on which
the rate of change has not been applied) have been
changed with shares with a nominal value of 1 Kurus."
The dividends are distributed within the scope of the
related legislation in a manner and at a time determined
by the General Assembly.
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen
180 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 181
Summary Report of the Board of Directors
Esteemed Shareholders,
Welcome to our Bank’s 99th Ordinary General Assembly Meeting.
As we present the Board of Directors' Report, the Balance Sheet and the Income Statement covering the results of our activities in fiscal
year 2022 for your review and approval, we respectfully greet all of you here today.
In 2022, the risks and uncertainties caused by the Russia-Ukraine war, as well as the commercial and financial sanctions imposed on
Russia, have been the main risk factors for the world economy, especially for European countries. While disruptions in supply chains for
basic needs such as energy and food due to the war increased global inflationary pressures, the rapid tightening of monetary policies
across the world caused economic activity to lose momentum.
Ordinary General Assembly Meeting:
As per the resolution of the Board of Directors of İşbank, the Ordinary General Assembly Meeting of the Bank will be
held on Thursday, 30 March 2023, at 14:00 at the İş Towers Head Office Auditorium, 34330 Levent/İstanbul.
In 2022, the Turkish economy grew by 5.6% on the back of high consumption expenditures and moderate contributions from exports
and investments. On the other hand, the rise in global commodity prices, particularly energy, caused the current account deficit to widen
and inflationary pressures to increase despite the rapid recovery in tourism revenues.
Agenda of the Ordinary General Assembly
1. Opening Ceremony, establishment of the Council of Chairmanship
While the banking sector continued to support economic activity in 2022, it maintained its strong outlook. The volume of Turkish Lira
loans, including loans to the financial sector, increased by 77.5% on an annual basis, reaching TL 4,749.6 billion as of December 30,
2022. In the same period, the volume of FX loans fell to USD 125.9 billion with a decrease of 15.7%. Accordingly, the total loan volume
expanded at a rate of 52.8% as of December 30, 2022 and reached TL 7,100 billion. According to the exchange rate adjusted data, the
total loan volume expanded by 38% in this period.
As of December 30, 2022, according to the Weekly Bulletin data published by the Banking Regulation and Supervision Agency, the
volume of TL deposits including deposits of banks increased by 145.7% and reached TL 4,468 billion compared to the same period in
2021 with the support of the FX-protected deposit accounts. The volume of FX deposits in USD terms decreased by 12.5% in this period
and was realized as USD 208.4 billion. Thus, as of December 30, 2022, the total deposit volume increased by 68.4% compared to the
same period of the previous year and reached TL 8,360 billion. According to the exchange rate adjusted data, the annual increase in total
deposit volume was 45.4%.
As of 31.12.2022, compared to the end of the previous year,
ੵ The amount of our loans reached TL 759.3 billion with a 53.9% increase,
ੵ The amount of our deposits reached TL 931.1 billion with a 56.3% increase,
ੵ Our total assets reached TL 1,408.3 billion with a 52.0% increase,
ੵ Our equity reached TL 191.4 billion with a 120.4% increase
.Thanks to its stable growth policy and effective risk management practices in loan allocation processes, our Bank achieved an NPL
ratio of 3.0% at the end of 2022. At the same time, İşbank maintained its leadership among private banks in terms of the total amount
of deposits in 2022 and continued to make use of non-deposit funding sources in domestic and foreign markets in order to diversify
funding sources and extend the maturity structure of its liabilities by taking funding costs into consideration.
The Bank preserved its strong capital structure throughout the year, with a capital adequacy ratio of 24.4%, well above the regulatory
limit, as of year-end 2022. The Bank achieved a net profit of TL 61.5 billion in 2022 with a return on average equity and return on average
assets of 46.8% and 5.3%, respectively.
Our Esteemed Shareholders,
We hereby submit our Annual Report, Balance Sheet and Income Statement pertaining to our activities during 2022 for your review and
approval. We would like to take this opportunity to express our gratitude to our stakeholders for their steadfast trust in our Bank, to the
institutions of the Republic of Türkiye for their support, and to our employees for their dedicated efforts. We extend our respects to you,
our valued shareholders, for having honored this General Meeting with your attendance.
İŞBANK BOARD OF DIRECTORS
2. Discussion of 2022 Annual Report of the Board of Directors, Financial Statements, the Independent Auditors' Reports and ratification
of the Annual Report of the Board of Directors and Financial Statements
3. Discharge of the Board of Directors from their responsibilities for the transactions and accounts of the year 2022
4. Determination of the method and date of allotment of dividends which is permitted to be distributed in cash by the BRSA based on
our Bank's application.
5. Determination of the allowance for the members of the Board of Directors
6. Election of the Members of the Board of Directors whose term of office has expired and the determination of their term of office
7. Selection of the Independent Audit Company
8. Permitting the Members of the Board of Directors as per articles 395 and 396 of the Turkish Commercial Code
9. Amendment of the article 5 of the Articles of Incorporation regarding increase of the maximum level of registered capital and the
extension of the permission period of the maximum level of registered capital
10. Submitting the amount of donations and aids made regarding earthquake to the information and approval of the shareholders
11. Presenting information to the shareholders about the donations
12. Presenting information to the shareholders on the subjects held in Capital Markets Board Corporate Governance Communique
principle no. 1.3.6
13. Presenting information about the buyback transactions executed in 2023 as per the resolution of the Board of Directors
14. Presenting information about our bank's decarbonization plan
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 182 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 183
Profit Distribution Proposal
As a result of our activities in 2022, our Bank's net profit for the period was TL 61,537,880,372.57, and the prior
years’ profit was TL 165,466,370.28 within the framework of various legislation.
In addition, as a portion of the net profit for the reporting year is distributed to the Bank's employees pursuant to
Article 58 of the Bank's Articles of Incorporation, we have an amount of TL 3,093,000,000.00 set aside within
2022 for dividends to be distributed to the Bank's employees within the framework of the TMS 19 - Employee
Benefits accounting standard by taking into consideration our dividend distribution policy, prior practices and the
applicable legislation.
Accordingly, it is proposed as follows:
ੵ the accounting profit making the basis of the distribution be determined as TL 61,703,346,742.85 by adding the
prior years' profit of TL 165,466,370.28 to the net profit for the period,
ੵ out of the accounting profit, the portion in the amount of TL 204,246,783.98 arising from the earnings on disposal
of real estates and shares be transferred to relevant reserves to be maintained in a specific fund account and for
conversion into capital when needed; and the portion of TL 272,095,016.00 be set aside as a venture capital fund
to be allocated to venture capital investment trusts and funds, so as to include the allocation of TL 988,973.00
venture capital investment related to R&D discount, and be subject to deduction in the corporate tax base in
accordance with the relevant legislation,
ੵ the portion in the amount of TL 3,093,000,000.00, which was set aside for dividends to be distributed to the
Bank's employees, be added to the distributable amount,
ੵ based on the distributable amount so formed, 10% thereof that needs to be set aside as first extraordinary
reserves be increased within the frame of the provisions of the Banking Law and the Turkish Commercial Code
and a total of TL 25,926,568,681.74 be set aside as first extraordinary reserves, and the distributable amount of
TL 64,320,004,942.87, which includes the first extraordinary reserves mentioned above, be distributed as follows
pursuant to the provisions of applicable legislation and Article 58 of the Articles of Incorporation of İşbank,
ੵ the remaining amount of TL 1,009,596,232.20 after distribution be set aside as extraordinary reserves.
PROFIT FOR THE PERIOD
PRIOR YEARS' PROFIT
NET ACCOUNTING PROFIT
NON-DISTRIBUTABLE PROFIT
ADDED TO DISTRIBUTION
DISTRIBUTABLE PROFIT
I. FIRST DISTRIBUTION
(Articles of Incorporation Art. 58/a-b)
- 5% Legal Reserves
- First Extraordinary Reserves
- First Dividends
To Group A Shares
To Group B Shares
To Group C Shares
II. SECOND DISTRIBUTION
(Articles of Incorporation Art. 58/c-d-e)
- To Founder Shares
- 20% to Bank Employees
- 10% Legal Reserves
- 10% Second Extraordinary Reserves
- Second Dividends
To Group A Shares
To Group B Shares
To Group C Shares
III. THIRD DISTRIBUTION
(Articles of Incorporation Art. 58/f)
- Third Dividends
To Group A Shares
To Group B Shares
To Group C Shares
- 10% Legal Reserves
3,216,000,247.14
45,043,201,118.96
60.00
1,740.00
599,998,200.00
38,652.01
3,092,160,715.35
509,220,116.74
1,546,080,357.68
540.00
6,960.00
1,899,994,300.00
107,686.99
117,109.60
6,730,416,751.40
673,064,154.80
TL
61,537,880,372.57
165,466,370.28
61,703,346,742.85
- 476,341,799.98
3,093,000,000.00
64,320,004,942.87
48,859,201,366.10
15,460,803,576.77
7,047,501,641.78
8,413,301,934.99
7,403,705,702.79
1,009,596,232.20
Provided that the above proposal is accepted by the General Assembly, dividend payout to the Bank's shareholders will commence on
03.04.2023, and gross profit shares shown in the table below, will be distributed to each share group with a nominal value of TL 1 and to
each founder share:
Type of Share
Gross TL
To Group A shares with a nominal value of TL 1
108.2869900
To Group B shares with a nominal value of TL 1
To Group C shares with a nominal value of TL 1
To each Founder Share
4.3382621
0.9230437
15.7249837
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İşbank 2022 Integrated Annual Report 185
Contribution
to Social Welfare
İşbank aims to use the added value it creates for the benefit of society via social
responsibility activities that consider community needs and have a long-term and lasting
impact; accordingly, the Bank has been implementing projects in the fields of
education and environment, as well as culture and arts
since its foundation. The Bank’s social investment programs are carried out under the
Corporate Social Responsibility Committee reporting to the Board of Directors. Effective
stakeholder participation in social responsibility projects is ensured through collaborations
with different stakeholder groups, particularly non-governmental organizations.
Related Capital
Elements
Material Topics
ᲁContribution to
social welfare
Risks
Loss of reputation
Reduced brand awareness among younger generations
Opportunities
Being a trusted bank in the eyes of stakeholders and
society with projects developed in line with society's
needs
Projects aligned with the UN Sustainable
Development Goals
Direct communication with customers thanks to
increased financial literacy
Contribution to corporate reputation
Contributed SDG’s
Key Performance Indicators
2018
2019
2020
2021
2022
Contribution to
equal opportunities
in education: 81
Students from 81
Cities
Including
graduates,
the number of
students is close
to 700.
With 54 students
who graduated in
2019, the number
of students is
nearly 750.
In 2020, the
total number
of graduates
reached 231.
In 2021, the
total number of
graduates reached
296.
In 2022, the total
number of graduates
reached 361.
With the 11th
campaign, a
total of 13 million
books have
been donated to
primary school
students to date.
With the 12th
campaign, a total
of 14 million
books have
been donated to
primary school
students to date.
The 13th
campaign was
transferred to
digital format
within the
framework
of COVID-19
measures and 4
electronic books
were donated.
The 14th
campaign was
held as a hybrid
campaign within
the framework
of COVID-19
measures. In
addition to the 3
electronic books
donated, 1 book
was also printed in
a limited number.
Within the scope of
the 15th campaign,
500,000 printed
copies of the book
“The Adventures of
Sherlock Holmes”
were presented to
students, and the book
“The Secret Garden”
was also presented to
children digitally via the
kumbaradergisi.com
portal.
More than 52
thousand books
were sent to
2,844 schools
and libraries.
More than 58
thousand books
were sent to
3,116 schools
and libraries.
Due to COVID-19,
more than 22
thousand books
were sent to
more than 1,200
schools and
libraries.
The number of
books sent to
schools reached
31,615 books
which were
distributed to 1,734
schools as of year-
end 2021.
The number of books
sent to schools
reached 56,000
books which were
distributed to 2,167
schools as of year-end
2022.
Supporting the
upbringing of
generations who
read and question,
and supporting
the cognitive
and cultural
development
of children: The
number of books
donated within the
“Show Your Report
Card, Get Your
Book” Campaign
Supporting the
upbringing of
generations who
read and question,
and supporting
the cognitive
and cultural
development of
children: Number
of books donated
to schools and
libraries
Targets
2022 Targets
Realization in 2022
Realization
Targets for 2023 and Beyond
Continuing the campaign in a hybrid
model in Show Your Report Card,
Get Your Book, within the COVID-19
measures
Continuing the "81 Students
from 81 Cities" project designed
for Darüşşafaka students and
undergraduate scholarship recipients
For the first time, printed books
were sent to all Bank branches and
museums in Türkiye and the TRNC.
The total number of graduates
reached 361.
✓⃝
✓⃝
Our campaign will continue both in
print and online.
The project is still ongoing.
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İşbank 2022 Integrated Annual Report 187
Projects in the Education Field
School Sports Chess Tournament
İşbank understands the importance of education in
achieving and preserving social development and carries
out inclusive long-term projects in the field of education.
The Bank's purpose is to contribute to the education of
new generations who embrace the principles of Atatürk
and will move our nation up among the ranks of modern
societies.
Chess
İşbank contributes to chess education to make it a
popular and easily accessible sport. The Bank became
the main sponsor of the Turkish Chess Federation (TCF)
in 2005 to help transform chess into a popular sport
across the country.
İşbank Chess Classes
Chess classes are set up in primary and secondary
schools to encourage children to play chess, draw the
attention of teachers and parents to this sport and
eliminate the lack of equipment in schools with limited
resources. As of 2022 , the total number of chess classes
opened in schools reached 30,000.
The Northern Cyprus Chess Federation
In addition to being the main sponsor of TSF, İşbank
has also been a sponsor of the Northern Cyprus Chess
Federation since 2013. After the sponsorship, chess
started to take place as a club activity once a week in
primary schools in the Turkish Republic of Northern
Cyprus (TRNC). All schools in the TRNC have a chess
class.
Türkiye Junior and Stars Chess
Championship
The “Turkish Junior and Junior Chess Championships”
held in Antalya every year in January were held in
Antalya between January 22 and 29. In 2022 Türkiye
Junior and Junior Chess Championships, 1,410 for
the age group of 7-12, 13-18 for the Turkish Junior
Chess Championship A total of 2,034 athletes, 624 of
whom were in the age range, were registered. Athletes
who ranked in every age category were entitled to
represent Türkiye in international tournaments and to
enter the National Team Pool.
School Sports Chess Local Competitions were held
between November 4, 2021 and March 4, 2022, and
Group Competitions were held between April 18-22,
2022. The final of the 2022 School Sports Chess Türkiye
Tournament was held at the Sivas Taha Akgül Indoor
Sports Hall between April 25-29, 2022.
81 Students from 81 Cities
With the mission of "equal opportunity in education",
Darüşşafaka offers children who have lost their mother
and/or father and who have insufficient financial means
a quality education under modern conditions from fifth
grade to the last year of high school with full scholarship
and boarding.
With the "81 Students from 81 Cities" project initiated
in the 2008-2009 academic year in cooperation with
Darüşşafaka, İşbank implemented one of the most
comprehensive and long-term projects in the field of
education in the country. The education expenses of all
students included in the program within the scope of the
project are covered by İşbank. Within the scope of the
project, at the end of the 2020-2021 academic year, 65
students graduated from the school in this 13th term,
and the total number of graduates reached 296. In 2022,
the total number of graduates reached 361.
İşbank continues to support students who graduated
from Darüşşafaka and passed the university entrance
exam under the 81 Students from 81 Cities Project. In
addition, within the scope of Koç University's "Anadolu
Scholarship Holders" program, the education expenses
of a certain number of students who graduate from
Darüşşafaka each year are covered by İşbank. The
total number of students, including the graduates, is
approximately 750.
Show Your Report Card, Get Your Book
"Show Your Report Card, Get Your Book", one of the
biggest book campaigns in Türkiye carried out to date,
was launched by İşbank at the end of the 2007-2008
academic year.
The campaign was intended to support the development
of children's cognitive and cultural abilities, support the
bringing up of a generation who reads and questions,
and contribute to cordial communication between İşbank
and children at an early age.
Turkish Chess Federation Main Sponsorship
Following the Turkish Chess Federation Main Sponsorship of İşbank;
Number of licensed athletes rose from
30,000 to
1,200,000
Number of chess trainers rose from
2 ,000 to
87,156
Number of chess clubs rose from
600 to
2 ,205
Athletes with titles rose from
6 to
227
Chess tournaments rose from
400 to
13,550
35 world championships, 37 world second place awards, 41 world third place awards,
84 European championships, 79 European second place awards, and 68 European third place awards have been won so far.
Total number of medals won 344
At the end of the 2021-2022 academic year, within the
scope of the 15th campaign, printed copies of the book
“The Adventures of Sherlock Holmes” were presented
to students, and the book “The Secret Garden” was also
presented to children digitally via the kumbaradergisi.
com portal. The digital books were enriched with
illustrations and animations. The books were sent to all
Bank branches and museums in Türkiye and the TRNC.
In addition, a limited number of books were printed in the
Braille alphabet and sent to schools providing education
for the visually impaired. For children in regional boarding
schools, affection houses, closed youth prisons and
juvenile reformatories, a selection of the works published
by İş Bankası Kültür Yaayınları and other children's books
were provided within the scope of the campaign.
Book Donation to Schools and Libraries
As part of our social responsibility efforts in the field of
contribution to education, books published by İşbank’s
Cultural Publications are sent to schools and public
libraries throughout Türkiye. In 2022, 56 thousand books
were delivered to 2,167 schools and libraries.
Kumbara Magazine
The magazines "Kumbara" and "Mini Kumbara", which
are prepared with two separate types of content for 3-6
and 7-14 age groups to provide high-quality, instructional
and entertaining content to children, are published digitally.
The interface of Kumbara Magazine, the main channel
of the Show Your Report Card, Get Your Book campaign,
has recently been updated, and the content frequency
has been increased. The magazine provides children with
plenty of entertaining and instructive content in areas such
as science, life, chess, culture and art.
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Golden Youth Award
Every year since 1971, students who are successful in the
university entrance exam are rewarded with the "Golden
Youth" award by İşbank. The number of students who
have been awarded so far has exceeded 3,700.
Artificial Intelligence Application and
Research Center
The "Artificial Intelligence Application and Research
Center" was established in cooperation with İşbank and
Koç University in order to contribute to the scientific
and academic activities of our country and to carry out
advanced studies in the field of artificial intelligence,
which is of great importance worldwide. In the Artificial
Intelligence Center established under the roof of Koç
University Faculty of Engineering, Koç University faculty
members train experts for industry and academia, as well
as work to solve the problems of the business world.
Infectious Diseases Application and
Research Center
During the COVID-19 pandemic, which affected the
world and our country, İşbank and Koç University
entered into an important cooperation and pioneered the
establishment of the "Infectious Diseases Application
and Research Center" in order to contribute to the
scientific and academic activities of our country in the
field of public health.
Established within Koç University with the support
of İşbank, the center is intended to contribute to the
scientific activities of our country in the field of public
health, conduct research on infectious diseases,
provide diagnosis and treatment solutions for diseases
and develop prevention methods. The center, which
undertakes coordinated projects among the Faculty
of Medicine, Engineering, Science, Economics and
Administrative Sciences and Humanities Faculties
within Koç University, carries out its activities at the Koç
University Hospital in Topkapı.
Projects in the Environmental Field
İşbank develops various projects in cooperation with
non-governmental organizations to create a better
world to live in, draw attention to environmental
problems associated with deforestation, and ensure the
development of environmental awareness in society,
especially among children.
The World is Ours, The Future is Ours
İşbank carries out various projects under the theme
“The World is Ours, The Future is Ours” with its efforts
in the field of sustainability, which is one of its strategic
priorities. In this context, the Bank sponsored the
Marmara Sea 2022 Symposium, organized for the 3rd
time by the Turkish Marine Research Foundation and
the documentary Bir Umut Marmara (Marmara, A Hope)
prepared by Savaş Karakaş to create and raise public
awareness and produce solutions against mucilage
and its impacts; it purchased an unmanned underwater
glider (Sea Explorer), which will be used for the first time
in Türkiye, to support the marine studies of the entire
academia and scientific world under the leadership of
METU Institute of Marine Sciences.
Nature Education Programs
TEMA Foundation’s Nature Education Programs are
supported with the revenues obtained from the İş Asset
Management TEMA Variable Fund - Türkiye’s first
environmental fund offered by İşbank and its subsidiary İş
Portföy.
"Nature Education Programs", which are defined as "Mini
TEMA" for preschool children and "Junior TEMA" for
elementary school-age children, are ecological literacy
trainings prepared by the TEMA Foundation for children to
spend time in nature, and observe and discover nature by
feeling, touching, smelling and hearing.
A total of 455,188 children were reached, 189,195
children within the scope of the Mini TEMA Nature
Education Program and 265,993 children within the
scope of the Junior TEMA Nature Education Program,
which were launched in the 2019-2020 Academic Year
and have continued with educational activities in schools
for three academic years.
Tema Foundation Collaboration
Based on an agreement entered into with the Tema
Foundation, the Tema Foundation undertakes to plant
one sapling for every 100 kg of paper donated by İşbank.
Within this scope, a total of 341,532✓ kg of paper was
donated for the period March 2020 - August 2022, and
3,415✓ saplings were planted during this period.
Projects in the Culture and Art Field
İşbank makes contributions to enrich the country's
cultural and artistic life and to bring works from the world’s
cultural and creative scene to the country. In addition, the
Bank supports projects aimed at unearthing the country's
archaeological heritage, introducing it to new generations,
and preserving it for the future.
İş Kültür Yayınları
Quality publishing, contribution to the development of the
Turkish language and helping children develop the habit
of reading at an early age are the main principles of İşbank
Cultural Publications. Within this context, more than 19
million books were presented to readers in 2022.
İş Sanat
İş Sanat conducts long-term, broad-reaching, and
sustainable activities on behalf of İşbank in cultural fields,
particularly art, museology, archaeology, and history, in
order to support our country's cultural development and
to enrich the accumulation of knowledge in culture and art
by offering opportunities for the public to interact with art.
Performing Arts
In 2022, İş Sanat continued its activities in the field of
performing arts with a hybrid approach using physical
and digital platforms. Many events featuring local
and international artists from various branches of the
performing arts, such as classical music concerts, local
projects, story and poetry recitals, and theater plays, were
presented to audiences at different venues, particularly
at İş Towers Hall. Events were organized outdoors in
Istanbul, Ankara and Izmir with "Friday After Work”, in
Bodrum Zai with “Wednesday Stage”, in various ancient
cities with “Ancient Stage”, and on the YouTube channel.
Art Galleries
Beril Anılanmert, Mahmut Celayir, and Yalçın Gökçebağ
exhibitions were organized at Kibele Art Gallery in the
2021-2022 season. The 2022-2023 season opened
with Mustafa Pilevneli’s exhibition “60 Years in Blues” and
continues with Saim Bugay’s exhibition “Heykelin Sözü”.
In the 2021-2022 season, Soner Genç, Habip Aydoğdu,
and Nevhiz Tanyeli exhibitions were organized at the
Ankara Art Gallery. Beril Anılanmert’s “Seyir Defteri”
exhibition opened the 2022-2023 gallery season.
Contributions in the Field of Archaeology
Archaeological studies are supported to unearth and
preserve Türkiye’s rich archaeological heritage and to
shed light on the history of civilization through scientific
studies. As of 2022, the archaeological activities
supported are presented below.
ੵ Zeugma Ancient City - House of Muses in Nizip - Gaziantep
ੵ Patara Ancient City in Kaş - Antalya
ੵ Teos Ancient City in Seferihisar - Izmir
ੵ Nysa Ancient City in Sultanhisar - Aydın
ੵ Stratonikeia Ancient City in Yatağan - Muğla, and
ੵ Yesemek Hittite Statue Workshop and Survey Research in
İslahiye - Nurdağı
Also in 2022, in archaeological publications, the book
“Nysa: The City with Two Sides” was prepared under the
editorship of excavation head Assoc. Prof. Serdar Hakan
Öztaner. Activities such as podcasts, videos, interviews,
etc. are carried out to strengthen cultural heritage
awareness in our country.
Museology and Institutional History
Studies
İşbank Museum (Eminönü, Istanbul)
Since opening its doors in November 2007, İşbank Museum
has been telling and presenting the long-established
corporate history of the Bank as well as the economic
development of Türkiye through banking equipment,
documents, communication tools, photographs, advertising-
promotional materials and films.
The number of visitors in 2022 reached 304,913, while the
total number of visitors since the opening of the Museum
reached 2,165,558. The Museum also continues to host its
visitors with temporary exhibitions.
ੵ The İstiklal Exhibition, which was originally opened within İşbank
Museum in 2019, was expanded with İzmir-specific additions, and
“Büyük Zaferin 100. Yılına Doğru İstiklal Sergisi(İstiklal Exhibition
Towards the 100th Anniversary of the Great Victory)” re-opened
for visitors at İzmir Kültürpark Atlas Pavilion on August 30, 2021.
The exhibition remained open until September 9, 2022, the 100th
anniversary of the liberation of Izmir, and was visited by 111,112 people.
ੵ On October 28, 2021, the exhibition titled "Bir Asrın Ardından
/ Cepheler, İnsanlar ve Büyük Zafer" (After a Century / Fronts,
People, and the Great Victory) was opened at the museum. The
exhibition was visited by 328,575 people from its opening date
until the end of 2022.
Workshops for schools, which were suspended due to the
pandemic, were resumed in 2022. In 2022, 5,868 students
were hosted in workshops organized under different topics.
İşbank Museum of Economic Independence
(Ulus, Ankara)
İşbank transformed its historical building in Ulus, Ankara,
which had served for many years as the Bank's third Head
Office building, into a museum in order to share with the
public its experience, which is of great importance in terms
of national economic history. The historical Ulus building, one
of the capital's landmarks, was opened to visitors in 2019 as
the "İşbank Museum of Economic Independence" to host
the documents and memories of the country's economic
independence and development process.
The number of visitors reached 87,620 in 2022, while the
total number of visitors reached 193,388. 6,036 students
participated in the workshops.
İşbank Painting and Sculpture Museum
(Beyoğlu, Istanbul)
The restoration and construction works that began in 2020
to transform the historic building in Beyoğlu into a museum
continued in 2022. The preparatory work of the Museum,
which is planned to be opened to visitors in the autumn of
2023, is being carried out in cooperation with the founding
curator Prof. Dr. Gül İrepoğlu, plastic arts consultant Prof. Rahmi
Aksungur, and museological consultant Burçak Madran.
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Independent Auditor’s Report
To the General Assembly of Türkiye İş Bankası Anonim Şirketi:
Audit of Unconsolidated Financial Statements
Qualified Opinion
We have audited the accompanying unconsolidated financial statements of Türkiye İş Bankası A.Ş (the Bank), which comprise the
statement of balance sheet as at December 31, 2022, and the unconsolidated statement of income, unconsolidated statement
of profit or loss and other comprehensive income, unconsolidated statement of changes in shareholders’ equity, unconsolidated
statement of cash flows and a summary of significant accounting policies and other explanatory notes to the unconsolidated financial
statements.
In our opinion, except for the effects of the matter on the unconsolidated financial statements described in the Basis of for Qualified
Opinion paragraph, the accompanying unconsolidated financial statements present fairly, in all material respects, the unconsolidated
financial position of Türkiye İş Bankası A.Ş. as at December 31, 2022 and unconsolidated financial performance and unconsolidated
its cash flows for the year then ended in accordance with the Banking Regulation and Supervision Agency (“BRSA”) Accounting and
Financial Reporting Legislation which includes “Regulation on Accounting Applications for Banks and Safeguarding of Documents”
published in the Official Gazette no.26333 dated 1 November 2006, and other regulations on accounting records of Banks published
by Banking Regulation and Supervision Agency and circulars and interpretations published by BRSA and Turkish Financial Reporting
Standards (“TFRS”) for those matters not regulated by the aforementioned regulations.
Basis of Qualified Opinion
As explained in Section Five Part II-i.4.5 and IV.f, the accompanying unconsolidated financial statements as at December 31, 2022
include a free provision at an amount of TL 8,475,000 thousands of which TL 4,075,000 thousands was provided in prior years
and TL 4,400,000 thousands provided in the current period by the Bank management for the possible effects of the negative
circumstances which may arise from the possible changes in the economy and market conditions which does not meet the
recognition criteria of “Turkish Accounting Standard” (TAS) 37 “Provisions, Contingent Liabilities and Contingent Assets”.
Our audit was conducted in accordance with “Regulation on independent audit of the Banks” published in the Official Gazette
no.29314 dated April 2, 2015 by BRSA (BRSA Independent Audit Regulation) and Independent Auditing Standards (“ISA”) which
are the part of Turkish Auditing Standards issued by the Public Oversight Accounting and Auditing Standards Authority (“POA”). Our
responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements
section of our report. We are independent of the Bank in accordance with of Code of Ethics for Independent Auditors (Code of
Ethics) published by POA and have fulfilled our other responsibilities in accordance with the code of ethics. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our qualified opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the unconsolidated
financial statements of the current period. Key audit matters were addressed in the context of our audit of the unconsolidated financial
statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. In addition to
the matter described in the Basis for Qualified Opinion section we have determined the matters described below to be the key audit
matters to be communicated in our report.
Türkiye İş Bankası Anonim Şirketi
Unconsolidated Financial Statements
As at and For the Year Ended
December 31, 2022
With Independent Auditor’s Report Thereon
This report includes “Independent Auditor’s Report” comprising
6 pages and; "Unconsolidated Financial Statements and Related
Disclosures and Footnotes” comprising 119 pages.
(Convenience Translation of Unconsolidated Financial Statements
and Related Disclosures and Footnotes Originally Issued in Turkish)
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Independent Auditor’s Report
Independent Auditor’s Report
Key Audit Matter
How the Key Audit Matter is addressed in our audit
Pension Fund Obligations
Financial impact of TFRS 9 “Financial Instruments” standard
and impairment on financial assets and related important
disclosures
As presented in Section III disclosure VIII, the Bank
recognizes expected credit losses of financial assets in
accordance with TFRS 9 Financial Instruments standard.
We considered impairment of financial assets as a key audit
matter since:
ੵ Amount of on and off-balance sheet items that are subject to
expected credit loss calculation is material to the financial
statements.
ੵ There are complex and comprehensive requirements of
TFRS 9.
ੵ The classification of the financial assets is based on
the Bank’s business model and characteristics of the
contractual cash flows in accordance with TFRS 9 and
the Bank uses significant judgment on the assessment
of the business model and identification of the complex
contractual cash flow characteristics of financial
instruments.
ੵ Policies implemented by the Bank management include
compliance risk to the regulations and other practices.
ੵ Processes of TFRS 9 are advanced and complex.
ੵ Judgements and estimates used in expected credit loss,
complex and comprehensive.
ੵ Disclosure requirements of TFRS 9 are comprehensive and
complex.
Our audit procedures included among others include:
ੵ Evaluating the appropriateness of accounting policies as to
the requirements of TFRS 9, Bank’s past experience, local
and global practices.
ੵ Reviewing and testing of processes which are used
to calculate expected credit losses by involving our
Information technology and process audit specialists.
ੵ Evaluation of the reasonableness and appropriateness of
key judgments and estimates determined by management
and the methods, judgments, and data sources used in
calculating expected loss, taking into account the standard
requirements, industry and global practices.
ੵ Reviewing the appropriateness of criteria in order to identify
the financial assets having solely payments of principal
and interest and checking the compliance to the Bank’s
Business model.
ੵ Evaluating the alignment of the significant increase in
credit risk determined during the calculation of expected
credit losses, default definition, restructuring definition,
probability of default, loss given default, exposure at default
and macro-economic variables that are determined by the
financial risk management experts with the Bank’s past
performance, regulations, and other processes that has
forward looking estimations.
ੵ Assessing the completeness and the accuracy of the data
used for expected credit loss calculation.
ੵ Testing the mathematical accuracy of expected credit loss
calculation on sample basis.
ੵ Evaluating the judgments and estimates used for the
individually assessed financial assets.
ੵ Evaluating the necessity and accuracy of the updates
made or required updates after the modeling process
ੵ Auditing of TFRS 9 disclosures.
It has been addressed whether there have been any
significant changes in regulations governing pension
liabilities, employee benefits plan during the period, that
could lead to adjust the valuation of employee benefits.
Support from actuarial auditor of our firm, has been taken
to assess the appropriateness of the actuarial assumptions
and calculations performed by the external actuary. We
further focused on the accuracy and adequacy of the Bank’s
provision provided for the deficit and also disclosures on key
assumptions related to pension fund deficit.
Employees of the Bank are members of “Türkiye İş Bankası
A.Ş. Mensupları Emekli Sandığı Vakfı”, (“the Fund”), which is
established in accordance with the temporary Article 20 of
the Social Security Act No. 506 and related regulations. The
Fund is a separate legal entity and foundation recognized
by an official decree, providing all qualified employees
with pension and post-retirement benefits. As disclosed in
the “Section Three Note XVII” to the financial statements,
Banks will transfer their pension fund to the Social Security
Institution and the authority of the “Council of Ministers” on
the determination of the mentioned transfer date is changed
as “President” in the Decree Law No. 703 published in the
Official Gazette numbered 30473 and dated July 9, 2018.
According to the technical balance sheet report as of 31
December 2022 prepared considering the related articles
of the Law regarding the transferrable benefit obligations for
the non- transferrable social benefits and payments which
are included in the articles of association, the Fund has an
actuarial and technical deficit which is fully provisioned for.
The valuation of the Pension Fund liabilities requires
judgment in determining appropriate assumptions such as
defining the transferrable social benefits, discount rates,
salary increases, demographic assumptions, inflation rate
estimates and the impact of any changes in individual
pension plans. The Bank Management uses Fund actuaries
to assist in assessing these assumptions.
Considering the subjectivity of key assumptions and
estimate used in the calculations of transferrable liabilities
and the effects of the potential changes in the estimates
used together with the uncertainty around the transfer date
and given the fact that technical interest rate is prescribed
under the law, we considered this to be a key audit matter.
Derivative Financial Instruments
Derivative financial instruments including foreign exchange
contracts, currency and interest rate swaps, currency and
interest rate options, futures and other derivative financial
instruments which are held for trading are initially recognized
on the statement of financial position at fair value and
subsequently are re-measured at their fair value. Details of
related amounts are explained in “Section Five Note I.c.” and
“Section Five Note II.b”.
Our audit procedures included among others involve
reviewing policies regarding fair value measurement
accepted by the bank management fair value calculations of
the selected derivative financial instruments which is carried
out by valuation experts of our firm and the assessment
of used estimations and the judgements and testing the
assessment of operating effectiveness of the key controls in
the process of fair value determination.
Fair value of the derivative financial instruments is
determined by selecting most convenient market data and
applying valuation techniques to those particular derivative
products. Derivative Financial Instruments are considered
by us as a key audit matter because of the subjectivity in the
estimates, assumptions and judgments used.
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İşbank 2022 Integrated Annual Report 195
Independent Auditor’s Report
TÜRKİYE İŞ BANKASI A.Ş
Responsibilities of Management and Directors for the Unconsolidated Financial Statements
Bank management is responsible for the preparation and fair presentation of the unconsolidated financial statements in accordance with the BRSA
Accounting and Reporting Legislation and for such internal control as management determines is necessary to enable the preparation of the financial
statement that is free from material misstatement, whether due to fraud or error.
In preparing the unconsolidated financial statements, management is responsible for assessing the Bank’s ability to continue as a going concern,
disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to
liquidate the Bank or to cease operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Bank’s financial reporting process.
Auditor’s Responsibilities for the Audit of the Unconsolidated Financial Statements
In an independent audit, the responsibilities of us as independent auditors are:
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether
due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee
that an audit conducted in accordance with BRSA Independent Audit Regulation and ISAs will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to
influence the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with BRSA Independent Audit Regulation and ISAs, we exercise professional judgement and maintain professional
scepticism throughout the audit. We also:
ੵ Identify and assess the risks of material misstatement of the unconsolidated financial statements, whether due to fraud or error, design and perform
audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. (The risk of
not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal control.)
ੵ Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of the Bank’s internal control.
ੵ Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
ੵ Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether
a material uncertainty exists related to events or conditions that may cast significant doubt on the Bank’s ability to continue as a going concern. If we
conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the unconsolidated
financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the
date of our auditor’s report. However, future events or conditions may cause the Bank to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the unconsolidated financial statements, including the disclosures, and whether the financial
statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit
findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with government with a statement that we have complied with relevant ethical requirements regarding independence,
and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable,
related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the
unconsolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report
unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be
communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of
such communication.
Report on Other Legal and Regulatory Requirements
1. In accordance with Article 402 paragraph 4 of the Turkish Commercial Code (“TCC”) no 6102; no significant matter has come to our attention
that causes us to believe that the Bank’s bookkeeping activities and financial statements for the period January 1 – December 31, 2022, are not in
compliance with the TCC and provisions of the Bank’s articles of association in relation to financial reporting.
2. In accordance with Article 402 paragraph 4 of the TCC; the Board of Directors submitted to us the necessary explanations and provided required
documents within the context of audit.
The engagement partner who supervised and concluded this independent auditor’s report is Fatma Ebru Yücel.
THE UNCONSOLIDATED FINANCIAL REPORT
AS AT AND FOR THE YEAR ENDED DECEMBER 31, 2022
Headquarters Address: İş Kuleleri, 34330, Levent/İstanbul
Telephone: 0212 316 00 00
Fax: 0212 316 09 00
Web site: www.isbank.com.tr
E-mail: musteri.iliskileri@isbank.com.tr
The unconsolidated financial report as at and for the year ended prepared in accordance with the communiqué of “Financial Statements and Related
Disclosures and Footnotes to be announced to Public by Banks” as regulated by Banking Regulation and Supervision Agency, comprises the following
sections:
GENERAL INFORMATION ABOUT THE BANK
UNCONSOLIDATED FINANCIAL STATEMENTS
EXPLANATIONS ON THE ACCOUNTING POLICIES
INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT
DISCLOSURES AND FOOTNOTES ON THE UNCONSOLIDATED FINANCIAL STATEMENTS
OTHER EXPLANATIONS
INDEPENDENT AUDITOR’S REPORT
The unconsolidated financial statements for the year ended and related disclosures and footnotes in this report are prepared in accordance with the
Regulation on the Procedures and Principles for Accounting Practices and Retention of Documents by Banks, “Banking Regulation and Supervision
Agency” (BRSA) regulations, “Turkish Accounting Standards”, “Turkish Financial Reporting Standards” and the related statements and guidance and in
compliance with the financial records of our Bank. Unless otherwise stated, the accompanying unconsolidated financial report is presented in thousands
of Turkish Lira (TL) and has been subjected to independent audit and presented as the attached.
Ersin Önder Çiftçioğlu
Member of the Board and
the Audit Committee
Yusuf Ziya Toprak
Deputy Chairperson of the Board of Directors
and Chairperson of the Audit Committee
Adnan Bali
Chairperson of the Board of Directors
Ali Tolga Ünal
Head of Financial Management Division
Gamze Yalçın
Deputy Chief Executive In Charge of
Financial Reporting
Hakan Aran
Chief Executive Officer
February 6, 2023
Istanbul, Turkey
Website
The authorized contact person for questions on this financial report:
Name – Surname/Title: Neşe Gülden Sözdinler/Head of Investor Relations and Sustainability
Division
Phone No
Fax No
E-mail
: +90 212 316 16 02
: +90 212 316 08 40
: nese.sozdinler@isbank.com.tr
investorrelations@isbank.com.tr
: www.isbank.com.tr
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196 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 197
Content
SECTION I
General Information about the Bank
I.
II.
III.
IV.
V.
VI.
Explanations on the Establishment Date and Initial Status of the Bank, History Including the Changes in the Former Status
Explanations on the Capital Structure, Shareholders who Directly or Indirectly, Solely or Jointly Undertake the Management and
Control of the Bank, any Changes in the Period, and Information on the Bank’s Risk Group
Explanations on the Chairperson’s, Directors’, Auditors’, Chief Executive Officer’s and Deputy Chief Executives’ Shares, if any, and the
Areas of their Responsibility sat the Bank
Information on the Bank’s Qualified Shareholders
Summary Information on the Bank’s Functions and Business Lines
Existing or Potential, Actual or Legal Obstacles on the Transfer of Shareholder’s Equity Between the Bank and its Subsidiaries or the
Reimbursement of Liabilities
VII. Written Policies on Assessment of Ensuring Compliance on Market Discipline, Disclosure Obligations, Frequency and Accuracy of
Related Disclosures
SECTION II
Unconsolidated Audit Financial Statements
I.
II.
III.
IV.
V.
VI.
VII.
Balance Sheet (Statement of Financial Position) – Assets
Balance Sheet (Statement of Financial Position) – Liabilities
Statement of Off-Balance Sheet Items
Statement of Profit or Loss
Statement of Profit or Loss and Other Comprehensive Income
Statement of Changes in the Shareholders’ Equity
Statement of Cash Flows
VIII.
Statement of Profit Distribution
SECTION III
Explanations on Accounting Policies
I.
II.
III.
IV.
V.
VI.
VII.
Basis of Presentation
Strategy for Use of Financial Instruments and Foreign Currency Transactions
Associates and Subsidiaries
Forward, Option Contracts and Derivative Instruments
Interest Income and Expenses
Fees and Commission Income and Expenses
Financial Assets
VIII.
Impairment of Financial Assets
IX.
X.
XI.
XII.
XIII.
XIV.
XV.
Offsetting Financial Instruments
Sale and Repurchase Agreements and Securities Lending Transactions
Non-current Assets Held for Sale and Discontinued Operations and Related Liabilities
Goodwill and Other Intangible Assets
Tangible Assets
Leasing Transactions
Provisions and Contingent Liabilities
XVI.
Contingent Assets
XVII.
Liabilities Regarding Employee Benefits
XVIII. Taxation
XIX.
XX.
XXI.
Borrowings
Equity Shares and Issuance of Equity Securities
Bank Acceptances and Bills of Guarantee
XXII. Government Incentives
XXIII. Segment Reporting
XXIV. Other Disclosures
198
198
198
199
199
199
199
200
201
202
204
205
206
208
209
210
210
211
211
211
211
211
213
214
214
214
214
215
215
215
216
216
217
219
219
219
219
219
219
SECTION IV
Information on the Financial Position and Risk Management of the Bank
I.
II.
III.
IV.
V.
VI.
VII.
Explanations on Shareholders’ Equity
Explanations on Credit Risk
Explanations on Currency Risk
Explanations on Interest Rate Risk
Explanations on Equity Shares Risk Arising from Banking Book
Explanations on Liquidity Risk Management and Liquidity Coverage Ratio
Explanations on Leverage Ratio
VIII.
Explanations on Other Price Risks
IX.
X.
XI.
Explanations on Presentation of Financial Assets and Liabilities at Fair Value
Explanations on Transactions Carried Out on Behalf of Third Parties and Fiduciary Transactions
Explanations on Risk Management Objectives and Policies
XII.
Explanations on Segment Reporting
SECTION V
Disclosures and Footnotes on the Unconsolidated Financial Statements
I.
II.
III.
IV.
V.
VI.
VII.
VIII.
IX.
Disclosures and Footnotes on Assets
Disclosures and Footnotes on Liabilities
Disclosures and Footnotes on Off-Balance Sheet Items
Disclosures and Footnotes on Statement of Income
Disclosures and Footnotes on the Statement of Changes in Shareholders’ Equity
Disclosures and Footnotes on Statement of Cash Flows
Disclosures and Footnotes on the Bank’s Risk Group
Disclosures on the Bank’s Domestic, Foreign, Off-Shore Branches or Subsidiaries and Foreign Representative Offices
Subsequent Events
SECTION VI
Other Explanations
I.
Explanations on the Bank’s Credit Ratings
SECTION VII
Explanations on the Independent Audit Report
I.
II.
Explanations on the Independent Auditors’ Report
Explanations and Footnotes of the Independent Auditors Report
220
227
236
238
242
243
248
249
249
251
251
267
268
281
289
291
295
296
297
298
298
299
299
299
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198 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 199
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
SECTION ONE: GENERAL INFORMATION ABOUT THE BANK
Chief Executive Officer and Deputy Chief Executives:
I.
Explanations on the Establishment Date and Initial Status of the Bank, History Including the Changes in the Former Status
TÜRKİYE İŞ BANKASI A.Ş. (“the Bank”) was established on August 26, 1924, to operate in all kinds of banking activities and to initiate and/or participate
in all kinds of financial and industrial sector undertakings when necessary. There is no change in the Bank’s status since its establishment.
II.
Explanations on the Capital Structure, Shareholders who Directly or Indirectly, Solely or Jointly Undertake the Management and
Control of the Bank, any Changes in the Period, and Information on the Bank’s Risk Group
As of December 31, 2022, 37.31% of the Bank’s shares are owned by T. İş Bankası A.Ş. Supplementary Pension Fund (Fund), 28.09% are owned by the
Republican People’s Party- CHP (Atatürk’s shares) and 34.60% are on free float (December 31, 2021: Fund 37.26%, CHP 28.09%, Free float 34.65%).
III.
Explanations on the Chairperson’s, Directors’, Auditors’, Chief Executive Officer’s and Deputy Chief Executives’ Shares, if any, and the
Areas of their Responsibility at the Bank
Chairperson and Members of the Board of Directors:
Name and Surname
Areas of Responsibility
Adnan Bali
Yusuf Ziya Toprak
Hakan Aran
Feray Demir
Ersin Önder Çiftçioğlu
Fazlı Bulut
Durmuş Öztek
Recep Hakan Özyıldız
Mustafa Rıdvan Selçuk
Ahmet Gökhan Sungur
Sadrettin Yurtsever
Chairperson of the Board of Directors, Remuneration Committee, Chairperson of the Risk Committee,
Sustainability Committee and Chairperson of the Board of Directors Operating Principles Committee
and the Member of the Credit Committee
Deputy Chairperson of the Board of Directors, Chairperson of the Audit Committee, TRNC Internal
Systems Committee and Operational Risk Committee, Member of the Risk Committee and Substitute
Member of the Credit Committee
Chief Executive Officer and Board Member, Chairperson of the Credit Committee, Human Resources
Committee and Information Systems Strategy Committee, Natural Member of the Risk Committee,
Chairperson of the Executive Committee
Director, Member of the Credit Committee, Corporate Governance Committee, Remuneration
Committee, Corporate Social Responsibility Committee, Sustainability Committee, and the Member of
the Board of Directors Operating Principles Committee
Director, Chairperson of the Sustainability Committee, Member of the Audit Committee and TRNC
Internal Systems Committee, Member of the Risk Committee and Operational Risk Committee
Director, Member of Corporate Social Responsibility Committee and Substitute Member of the Credit
Committee
Director, Member of Corporate Social Responsibility Committee, and the Member of the Board of
Directors Operating Principles Committee
Director
Director
Director
Director, Member of Corporate Governance Committee and Corporate Social Responsibility Committee
Name and Surname
Areas of Responsibility
Hakan Aran
Nevzat Burak Seyrek
Ebru Özşuca
Gamze Yalçın
H. Cahit Çınar
Ozan Gürsoy
Sezgin Yılmaz
Sabri Gökmenler
Sezgin Lüle
Can Yücel
Sezai Sevgin
İzlem Erdem
Suat E. Sözen
O. Tufan Kurbanoğlu
Mehmet Celayir
Chief Executive Officer and Member of the Board of Directors, Credit Committee, Chairperson of
Human Resources Committee and Information Technologies Strategic Committee Natural Member of
Risk Committee, Member of Operational Risk Committee and Chairperson of the Executive Committee
Corporate and Commercial Banking Marketing, Commercial Banking Sales, Transboundary Banking,
Free Zone Branches, Member of the Sustainability Committee
Treasury, Economic Research, Capital Markets, Member of the Risk Committee
Financial Management, Financial Institutions, Investor Relations and Sustainability, Managerial
Reporting and Internal Accounting, Information Technologies Strategic Committee, Member of Risk
Committee and Sustainability Committee
Legal Consultancy, Associates, Member of the Operational Risk Committee, Construction and Real
Estate Management, Member of the Sustainability Committee
Human Resources Management, Strategic and Corporate Performance Management, Agile
Management, Corporate Architecture, Member of Information Technologies Strategic Committee,
Operational Risk Committee and Sustainability Committee
Member of Retail Banking Marketing, Sales and Products, Retail Loans, Sustainability Committee
Information Technologies, Data Management, Acquisition, Artificial Intelligence, Member of Operational
Risk Committee, Sustainability Committee, and Information Technologies Strategic Committee
Customer Relations Coordination Responsible, Digital Banking, Customer Relations, Card Payment
Ecosystems, Card Payment Operations, Card Payment Products and Member of Operational Risk
Committee
Retail, Commercial and Corporate Loans Allocation, Loans Monitoring, Credits Portfolio Management,
Project Finance, Member of the Corporate Social Responsibility Committee, Member of the Risk
Committee and Sustainability Committee
Information Security, Internal Control, Corporate Compliance, Natural Member of the Risk Committee,
Information Technologies Strategic Committee, Member of the Operational Risk Committee and
Sustainability Committee
SME and Enterprise Banking Product and Sales, Agricultural Banking Marketing, Commercial Banking
Product, Member of Sustainability Committee
General Secretary, Corporate Communication, Digital Banking, Member of the Corporate Social
Responsibility Committee, Member of the Sustainability Committee
Legal Affairs and Legal Proceedings, Loans Monitoring, Commercial and Corporate Loans and Retail
Loans Proceedings
Member of Banking Base Operations, Agile Management, Support Services, External Operations and
Commercial Loan Operations, Operational Risk Committee
At the meeting of the Board of Directors of the Bank dated 13.12.2022, it was decided to appoint Mr. Mehmet Celayir to the position of Deputy Chief Executive. Mr. Yalçın Sezen
retired from his position at the Bank on 31.01.2023.
The Parent Bank’s shares attributable to the Directors and members of the Audit Committee, to the CEO and the Deputy Chief Executives are of minor
importance.
IV.
Information on the Bank’s Qualified Shareholders
Name Surname/Company
Shares
Ownership
Paid-in Capital
Unpaid Capital
T. İş Bankası A.Ş. Mensupları Munzam Sosyal
Güvenlik ve Yardımlaşma Sandığı Vakfı (İşbank
Members’ Supplementary Pension Fund)
Cumhuriyet Halk Partisi – Republican People’s
Party - (Atatürk’s Shares)
3,731,244
%37.31
3,731,244
2,809,205
%28.09
2,809,205
V.
Summary Information on the Bank’s Functions and Business Lines
In line with the relevant legislation and principles stated in the Articles of Incorporation of the Bank, the Bank’s activities include operating in retail,
commercial, corporate and private banking, foreign currency and money market operations, marketable securities operations, international banking
services and other banking operations, as well as initiating or participating in all kinds of financial and industrial sector corporations as may be required.
VI.
None.
VII.
Existing or Potential, Actual or Legal Obstacles on the Transfer of Shareholders’ Equity between the Bank and its Subsidiaries or the
Reimbursement of Liabilities
VII. Written Policies on Assessment of Ensuring Compliance on Market Discipline, Disclosure Obligations, Frequency and Accuracy
of the Related Disclosures
The Bank has written policies on assessment of ensuring compliance on market discipline, disclosure obligations, frequency and accuracy of related
disclosures. The mentioned policies which are agreed by Board of Directors’ can be obtained from the Bank’s website.
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 200 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 201
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Unconsolidated Balance Sheet (Statement Of Financial Position)
Unconsolidated Balance Sheet (Statement Of Financial Position
SECTION TWO: UNCONSOLIDATED FINANCIAL STATEMENTS
ASSETS
FINANCIAL ASSETS (NET)
Cash and Cash Equivalents
Cash and Balances with Central Bank
Banks
Money Market Placements
Expected Credit Loss (-)
Foot
notes
V-I-a
V-I-ç
THOUSAND TL
CURRENT PERIOD
(31/12/2022)
PRIOR PERIOD
(31/12/2021)
TL
FC
Total
TL
FC
Total
152.182.251
271.580.331
423.762.582
77.063.730
248.977.452
326.041.182
22.339.070
199.486.876
221.825.946
17.445.369
188.544.363
205.989.732
21.699.372
177.230.281
198.929.653
17.280.450
164.642.771
181.923.221
650.374
22.384.255
23.034.629
168.221
23.961.080
24.129.301
-
-
-
10.676
127.660
138.336
-
3.302
-
59.488
-
62.790
Financial Assets at Fair Value Through Profit or Loss
V-I-b
4.703.224
9.607.720
14.310.944
2.220.989
8.351.219
10.572.208
Government Debt Securities
Equity Securities
Other Financial Assets
Financial Assets at Fair Value Through Other
Comprehensive Income
Government Debt Securities
Equity Securities
Other Financial Assets
377.411
498.961
3.826.852
9.274.555
9.651.966
333.165
832.126
477.614
207.094
-
3.826.852
1.536.281
6.006.316
6.483.930
458.187
1.886.716
665.281
3.422.997
V-I-d
124.642.997
45.953.397
170.596.394
56.816.982
30.738.094
87.555.076
124.131.177
44.220.021
168.351.198
56.387.087
28.618.627
85.005.714
160.992
350.828
935.061
798.315
1.096.053
1.149.143
80.176
349.719
472.152
1.647.315
552.328
1.997.034
Derivative Financial Assets
V-I-c-i
496.960
16.532.338
17.029.298
580.390
21.343.776
21.924.166
Derivative Financial Assets at Fair Value Through Profit
or Loss
Derivative Financial Assets at Fair Value Through Other
Comprehensive Income
Financial Assets Measured at Amortised Cost
(Net)
Loans
Lease Receivables
Factoring Receivables
Other Financial Assets Measured at Amortised
Cost (Net)
Government Debt Securities
Other Financial Assets
Expected Credit Loss (-)
496.960
16.532.338
17.029.298
580.390
21.343.776
21.924.166
-
-
-
-
-
-
555.605.494
287.547.860
843.153.354
310.048.682
222.249.550
532.298.232
V-I-e
V-I-ı
493.476.961
288.946.360
782.423.321
287.305.913
226.902.837
514.208.750
-
-
-
-
-
-
-
-
-
-
-
-
V-I-f
85.116.372
8.257.625
93.373.997
41.733.414
4.679.320
46.412.734
84.231.448
2.808.785
87.040.233
41.550.971
2.111.385
43.662.356
884.924
5.448.840
6.333.764
182.443
2.567.935
2.750.378
22.987.839
9.656.125
32.643.964
18.990.645
9.332.607
28.323.252
ASSETS HELD FOR SALE AND DISCONTINUED
OPERATIONS (Net)
V-I-n
1.594.570
6.055
1.600.625
1.594.570
6.055
1.600.625
-
-
-
818.101
818.101
-
9.532
9.532
-
827.633
827.633
-
69.572.029
10.287.445
79.859.474
34.921.907
4.539.438
39.461.345
Investments in Associates (Net)
V-I-g
399.382
Held for Sale
Discontinued Operations
EQUITY INVESTMENTS
Associates Accounted by using Equity Method
Unconsolidated Associates
Subsidiaries (Net)
Unconsolidated Financial Subsidiaries
27.085.925
10.287.445
37.373.370
13.073.619
4.539.438
Unconsolidated Non-Financial Subsidiaries
42.086.722
V-I-ğ
69.172.647
10.287.445
79.460.092
34.610.826
4.539.438
39.150.264
-
399.382
-
-
-
-
-
-
399.382
311.081
-
-
399.382
311.081
-
-
-
311.081
-
311.081
-
-
-
-
42.086.722
21.537.207
-
-
-
-
-
-
-
-
-
-
17.613.057
21.537.207
-
-
-
17.131.994
3.506.177
-
64.954
17.196.948
8.659.882
8.256
3.514.433
1.747.103
-
-
-
39.978
3.006
-
8.699.860
1.750.109
-
3.506.177
8.256
3.514.433
1.747.103
3.006
1.750.109
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
87.529
2.470.081
2.557.610
31.917.998
7.317.254
39.235.252
7.774.473
7.158.580
14.933.053
831.510.513
576.812.155
1.408.322.668
441.121.407
485.447.617
926.569.024
Joint Ventures (Net)
Joint Ventures Accounted by using Equity Method
Unconsolidated Joint Ventures
TANGIBLE ASSETS (Net)
INTANGIBLE ASSETS (Net)
Goodwill
Other
INVESTMENT PROPERTY (Net)
CURRENT TAX ASSET
DEFERRED TAX ASSET
OTHER ASSETS
TOTAL ASSETS
V-I-h
V-I-j
V-I-k
V-I-l
V-I-m
V-I-o
I.
1.1
1.1.1
1.1.2
1.1.3
1.1.4
1.2
1.2.1
1.2.2
1.2.3
1.3
1.3.1
1.3.2
1.3.3
1.4
1.4.1
1.4.2
II.
2.1
2.2
2.3
2.4
2.4.1
2.4.2
2.5
III.
3.1
3.2
IV.
4.1
4.1.1
4.1.2
4.2
4.2.1
4.2.2
4.3
4.3.1
4.3.2
V.
VI.
6.1
6.2
VII.
VIII.
IX.
X.
I.
II.
III.
IV.
4.1
4.2
4.3
V.
5.1
5.2
VI.
VII.
7.1
7.2
VIII.
IX.
X.
10.1
10.2
10.3
10.4
XI.
XII.
XIII.
13.1
13.2
XIV.
14.1
14.2
XV.
XVI.
16.1
16.2
16.2.1
16.2.2
16.2.3
16.3
16.4
16.5
16.5.1
16.5.2
16.5.3
16.5.4
16.6
16.6.1
16.6.2
LIABILITIES
DEPOSITS
FUNDS BORROWED
MONEY MARKETS
Foot
notes
V-II-a
V-II-c
THOUSAND TL
CURRENT PERIOD
(31/12/2022)
PRIOR PERIOD
(31/12/2021)
TL
FC
Total
TL
FC
Total
386.133.818
544.943.471
931.077.289
167.618.387
428.009.989
595.628.376
3.366.612
68.088.714
71.455.326
2.505.052
63.146.374
65.651.426
28.009.248
12.090.068
40.099.316
39.121.801
9.113.694
48.235.495
SECURITIES ISSUED (Net)
V-II-ç
2.157.957
26.156.146
28.314.103
5.194.456
25.441.356
30.635.812
Bills
Asset Backed Securities
Bonds
FUNDS
Borrower Funds
Other
FİNANCIAL LIABILITIES AT FAIR VALUE THROUGH
PROFIT OR LOSS
DERIVATIVE FINANCIAL LIABILITIES
Derivative Financial Liabilities at Fair Value Through
Profit or Loss
Derivative Financial Liabilities at Fair Value Through
Other Comprehensive Income
FACTORING PAYABLES
LEASE PAYABLES (Net)
PROVISIONS
Restructuring Provisions
Reserve for Employee Benefits
Insurance Technical Provisions (Net)
Other Provisions
CURRENT TAX LIABILITY
DEFERRED TAX LIABILITY
LIABILITIES RELATED TO ASSETS HELD FOR SALE
AND DISCONTINUED OPERATIONS
V-II-
b-g
V-II-f
V-II-ğ
V-II-h
V-II-h
V-II-ı
Held for Sale
Discontinued Operations
SUBORDINATED DEBT
Loans
Other Debt Instruments
OTHER LIABILITIES
SHAREHOLDERS' EQUITY
Paid-in capital
Capital Reserves
Share Premium
Share Cancellation Profits
Other Capital Reserves
Accumulated Other Comprehensive Income or Loss
Not Reclassified Through Profit or Loss
Accumulated Other Comprehensive Income or Loss
Reclassified Through Profit or Loss
Profit Reserves
Legal Reserves
Status Reserves
Extraordinary Reserves
Other Profit Reserves
Profit or Loss
Prior Periods' Profit or Loss
Current Period Profit or Loss
1.755.212
0
0
0
1.755.212
3.133.754
0
0
0
0
3.133.754
0
402.745
26.156.146
26.558.891
2.060.702
25.441.356
27.502.058
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
2.836.442
6.004.376
8.840.818
6.163.475
6.423.058
12.586.533
2.836.442
6.004.376
8.840.818
6.163.475
6.423.058
12.586.533
0
0
0
0
0
0
0
0
0
0
0
0
2.053.406
98.801
2.152.207
1.614.884
85.555
1.700.439
29.136.548
1.402.544
30.539.092
14.400.399
1.086.919
15.487.318
0
5.507.254
0
0
0
0
0
0
5.507.254
2.392.832
0
0
0
0
0
0
2.392.832
0
23.629.294
1.402.544
25.031.838
12.007.567
1.086.919
13.094.486
6.531.922
1.080.530
0
0
0
31.008
6.562.930
1.816.875
14.344
1.831.219
0
0
0
0
1.080.530
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
V-II-i
2.277.824
31.280.921
33.558.745
2.296.445
35.174.552
37.470.997
0
0
0
0
0
0
2.277.824
31.280.921
33.558.745
2.296.445
35.174.552
37.470.997
V-II-e
V-II-j
49.847.129
13.419.108
63.266.237
24.978.068
5.524.050
30.502.118
196.315.737
-4.939.662
191.376.075
89.923.933
-3.084.642
86.839.291
10.000.000
1.164.946
108.952
0
1.055.994
0
204
204
0
0
10.000.000
4.500.000
1.165.150
109.156
0
1.113.235
108.944
0
1.055.994
1.004.291
0
204
204
0
0
4.500.000
1.113.439
109.148
0
1.004.291
20.188.138
-1.146
20.186.992
7.840.024
-617
7.839.407
44.848.370
-4.938.720
39.909.650
11.507.178
-3.084.229
8.422.949
58.410.937
6.168.857
0
52.242.080
0
61.703.346
165.466
61.537.880
0
0
0
0
0
0
0
0
58.410.937
46.081.015
6.168.857
5.065.786
0
0
52.242.080
41.015.229
0
0
61.703.346
18.882.481
165.466
5.414.586
61.537.880
13.467.895
0
0
0
0
0
0
0
0
46.081.015
5.065.786
0
41.015.229
0
18.882.481
5.414.586
13.467.895
TOTAL LIABILITIES AND SHAREHOLDERS'
EQUITY
709.747.173
698.575.495
1.408.322.668
355.633.775
570.935.249
926.569.024
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen
202 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 203
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Unconsolidated Balance Sheet (Statement Of Financial Position)
Unconsolidated Statement Of Off-Balance Sheet Items
Foot
notes
CURRENT PERIOD
(31/12/2022)
PRIOR PERIOD
(31/12/2021)
TL
FC
Total
TL
FC
Total
THOUSAND TL
A. OFF-BALANCE SHEET CONTINGENCIES and
COMMITMENTS (I+II+III)
V-III
453.428.754
823.573.068
1.277.001.822
284.514.410
709.267.988
993.782.398
GUARANTEES AND SURETYSHIPS
90.063.305
156.633.209
246.696.514
46.066.357
147.369.066
193.435.423
Letters of Guarantee
84.315.803
94.966.881
179.282.684
45.796.275
85.701.218
131.497.493
Guarantees Subject to State Tender Law
1.344.063
1.143.615
2.487.678
865.540
764.138
1.629.678
Guarantees Given for Foreign Trade Operations
11.143.447
40.608.395
51.751.842
4.204.824
46.666.437
50.871.261
Other Letters of Guarantee
Bank Acceptances
Import Letter of Acceptance
Other Bank Acceptances
Letters of Credit
Documentary Letters of Credit
Other Letters of Credit
Prefinancing Given as Guarantee
Endorsements
Endorsements to the Central Bank of Turkey
Other Endorsements
Purchase Guarantees for Securities Issued
Factoring Guarantees
Other Guarantees
Other Suretyships
COMMITMENTS
Irrevocable Commitments
Forward Asset Purchase Commitments
Forward Deposit Purchase and Sales Commitments
Capital Commitments to Associates and Subsidiaries
Loan Granting Commitments
Securities Underwriting Commitments
Commitments for Reserve Deposit Requirements
Commitments for Cheque Payments
Tax and Fund Liabilities from Export Commitments
Commitments for Credit Card Expenditure Limits
Commitments for Credit Cards and Banking Services
Promotions
Receivables from Short Sale Commitments
Payables for Short Sale Commitments
Other Irrevocable Commitments
Revocable Commitments
Revocable Loan Granting Commitments
Other Revocable Commitments
71.828.293
53.214.871
125.043.164
40.725.911
38.270.643
78.996.554
5.576.890
3.754.586
9.331.476
111.350
14.670.501
14.781.851
0
667.717
667.717
0
498.510
498.510
5.576.890
3.086.869
8.663.759
170.612
133.794
36.818
53.075.611
53.246.223
33.011.590
33.145.384
20.064.021
20.100.839
111.350
158.732
105.367
53.365
14.171.991
14.283.341
42.736.471
42.895.203
29.051.381
29.156.748
13.685.090
13.738.455
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
4.836.131
4.836.131
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
4.260.876
4.260.876
0
0
188.802.924
30.478.905
219.281.829
97.612.185
45.290.289
142.902.474
186.639.578
22.139.127
208.778.705
96.073.979
35.197.535
131.271.514
980
0
1.000.000
65.197.193
0
0
5.447.537
22.490
112.111.363
277.375
0
0
2.582.640
2.163.346
2.128.346
35.000
4.515.325
4.516.305
9.291.941
17.794.260
27.086.201
0
0
0
1.000.000
0
0
0
0
0
0
2.105.002
67.302.195
34.174.955
1.702.741
35.877.696
0
0
0
0
0
0
0
0
0
0
0
0
5.447.537
3.291.900
22.490
41.377
112.111.363
46.524.830
277.375
208.406
0
0
0
0
0
0
0
0
0
0
0
0
0
0
3.291.900
41.377
46.524.830
208.406
0
0
15.518.800
18.101.440
2.540.570
15.700.534
18.241.104
8.339.778
10.503.124
1.538.206
10.092.754
11.630.960
8.339.778
10.468.124
1.488.206
10.092.754
11.580.960
0
35.000
50.000
0
50.000
DERIVATIVE FINANCIAL INSTRUMENTS
174.562.525
636.460.954
811.023.479
140.835.868
516.608.633
657.444.501
Derivative Financial Instruments Held for Risk
Management
Fair Value Hedges
Cash Flow Hedges
Net Foreign Investment Hedges
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
I.
1.1
1.1.1
1.1.2
1.1.3
1.2
1.2.1
1.2.2
1.3
1.3.1
1.3.2
1.4
1.5
1.5.1
1.5.2
1.6
1.7
1.8
1.9
II.
2.1
2.1.1
2.1.2
2.1.3
2.1.4
2.1.5
2.1.6
2.1.7
2.1.8
2.1.9
2.1.10
2.1.11
2.1.12
2.1.13
2.2
2.2.1
2.2.2
III.
3.1
3.1.1
3.1.2
3.1.3
Foot
notes
CURRENT PERIOD
(31/12/2022)
PRIOR PERIOD
(31/12/2021)
TL
FC
Total
TL
FC
Total
THOUSAND TL
Derivative Financial Instruments Held for Trading
174.562.525
636.460.954
811.023.479
140.835.868
516.608.633
657.444.501
Forward Foreign Currency Buy/Sell Transactions
9.076.327
53.207.947
62.284.274
13.885.441
46.330.649
60.216.090
Forward Foreign Currency Buy Transactions
Forward Foreign Currency Sell Transactions
Currency and Interest Rate Swaps
Currency Swap Buy Transactions
Currency Swap Sell Transactions
Interest Rate Swap Buy Transactions
Interest Rate Swap Sell Transactions
Currency, Interest Rate and Security Options
Currency Call Options
Currency Put Options
Interest Rate Call Options
Interest Rate Put Options
Securities Call Options
Securities Put Options
Currency Futures
Currency Buy Futures
Currency Sell Futures
Interest Rate Futures
Interest Rate Buy Futures
Interest Rate Sell Futures
Other
6.486.754
24.879.081
31.365.835
9.851.253
20.305.444
30.156.697
2.589.573
28.328.866
30.918.439
4.034.188
26.025.205
30.059.393
158.868.495
505.601.396
664.469.891
117.694.703
424.446.452
542.141.155
12.686.066
180.280.643
192.966.709
6.016.040
158.921.467
164.937.507
144.722.429
72.885.673
217.608.102
111.278.663
66.277.089
177.555.752
730.000
730.000
5.720.382
3.160.239
2.560.143
0
0
0
0
897.321
192.908
704.413
0
0
0
0
126.217.540
126.217.540
23.965.147
8.188.359
8.132.464
3.822.162
3.822.162
0
0
743.203
559.500
183.703
0
0
0
126.947.540
126.947.540
29.685.529
11.348.598
10.692.607
3.822.162
3.822.162
0
0
1.640.524
752.408
888.116
0
0
0
52.943.261
52.943.261
200.000
200.000
99.623.948
99.823.948
99.623.948
99.823.948
8.573.317
21.264.309
29.837.626
4.553.586
4.019.731
0
0
0
0
682.407
0
682.407
0
0
0
0
6.303.322
10.856.908
6.549.875
10.569.606
4.205.556
4.205.556
4.205.556
4.205.556
0
0
687.983
687.983
0
0
0
0
0
0
1.370.390
687.983
682.407
0
0
0
23.879.240
23.879.240
3.2
3.2.1
3.2.1.1
3.2.1.2
3.2.2
3.2.2.1
3.2.2.2
3.2.2.3
3.2.2.4
3.2.3
3.2.3.1
3.2.3.2
3.2.3.3
3.2.3.4
3.2.3.5
3.2.3.6
3.2.4
3.2.4.1
3.2.4.2
3.2.5
3.2.5.1
3.2.5.2
3.2.6
B. EMANET VE REHİNLİ KIYMETLER (IV+V+VI)
1.116.249.656
1.495.889.698
2.612.139.354
796.887.897
993.775.709
1.790.663.606
IV.
4.1
4.2
4.3
4.4
4.5
4.6
4.7
4.8
V.
5.1
5.2
5.3
5.4
5.5
5.6
5.7
VI.
ITEMS HELD IN CUSTODY
Customers' Securities Held
Investment Securities Held in Custody
Cheques Received for Collection
84.271.660
172.676.943
256.948.603
60.617.295
121.635.447
182.252.742
0
0
0
0
0
0
34.788.786
4.899.694
39.688.480
33.813.447
4.930.182
38.743.629
44.145.057
93.149.806
137.294.863
23.306.991
68.668.580
91.975.571
Commercial Notes Received for Collection
3.841.357
35.954.510
39.795.867
2.980.895
26.788.763
29.769.658
Other Assets Received for Collection
Assets Received for Public Offering
Other Items Under Custody
Custodians
PLEDGED ITEMS
Marketable Securities
Guarantee Notes
Commodity
Warranty
Real Estates
Other Pledged Items
Pledged Items-Depository
ACCEPTED BILL, GUARANTEES AND SURETIES
TOTAL OFF-BALANCE SHEET COMMITMENTS
(A+B)
0
0
0
0
0
0
0
0
0
0
0
0
1.496.460
38.672.933
40.169.393
515.962
21.247.922
21.763.884
0
0
0
0
0
0
1.031.977.996
1.323.212.755
2.355.190.751
736.270.602
872.140.262
1.608.410.864
67.423.981
800.624
68.224.605
53.604.619
352.719
53.957.338
2.550.997
35.205.788
37.756.785
2.516.138
33.012.695
35.528.833
235.924.378
132.452.520
368.376.898
144.690.167
75.209.001
219.899.168
0
0
0
0
0
0
561.535.101
876.040.583
1.437.575.684
398.843.430
580.623.489
979.466.919
164.543.539
278.713.240
443.256.779
136.616.248
182.942.358
319.558.606
0
0
0
0
0
0
0
0
0
0
0
0
1.569.678.410 2.319.462.766
3.889.141.176 1.081.402.307
1.703.043.697
2.784.446.004
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen
204 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 205
Türkiye İş Bankası A.Ş.
Unconsolidated Income Statement
Türkiye İş Bankası A.Ş.
Unconsolidated Statement of Profit or Loss and Other
Comprehensive Income
PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
I.
II.
2.1
2.1.1
2.1.2
2.1.3
2.1.4
2.1.5
2.2
2.2.1
2.2.2
2.2.3
2.2.4
2.2.5
2.2.6
III.
PROFIT/LOSS FOR THE PERIOD
OTHER COMPREHENSIVE INCOME
Other comprehensive income that will not be reclassified to profit or loss
Revaluation Surplus on Tangible Assets
Revaluation Surplus on Intangible Assets
Gains/(Losses) on remeasurements of Defined Benefit Plans
Other Income/Expense Items of Other Comprehensive Income not to be Reclassified to
Profit Or Loss
Taxes Relating To Components Of Other Comprehensive Income not to be Reclassified To
Profit Or Loss
Other Income/Expense Items not be Reclassified to Profit or Loss
Exchange Differences on Translation
Valuation and/or Reclassification Profit or Loss from Financial Assets at Fair Value
through Other Comprehensive Income
Income/(Loss) Related with Cash Flow Hedges
Income/(Loss) Related with Hedges of Net Investments in Foreign Operations
Other Income/Expense Items of Other Comprehensive Income to be Reclassified to
Other Profit or Loss
Taxes Relating To Components Of Other Comprehensive Income to be Reclassified To
Profit Or Loss
TOTAL COMPREHENSIVE INCOME (I+II)
THOUSAND TL
CURRENT PERIOD
(31/12/2022)
PRIOR PERIOD
(31/12/2021)
61.537.880
43.834.286
12.347.585
7.126.488
0
-2.593.679
8.119.452
-304.676
31.486.701
2.071.370
32.024.551
0
0
5.517.021
-8.126.241
105.372.166
13.467.895
7.268.169
3.606.560
1.606.325
0
-713.198
2.731.426
-17.993
3.661.609
1.702.150
-532.979
0
0
2.433.200
59.238
20.736.064
INCOME STATEMENT
INTEREST INCOME
Interest Income on Loans
Interest Income on Reserve Deposits
Interest Income on Banks
Interest Income on Money Market Placements
Interest Income on Marketable Securities Portfolio
Financial Assets At Fair Value Through Profit or Loss
Financial Assets At Fair Value Through Other Comprehensive Income
Financial Assets At Measured at Amortised Cost
Financial Lease Income
Other Interest Income
INTEREST EXPENSE (-)
Interest on Deposits
Interest on Funds Borrowed
Interest on Money Market Funds
Interest on Securities Issued
Financial Lease Expense
Other Interest Expenses
NET INTEREST INCOME (I - II)
NET FEES AND COMMISSIONS INCOME
Fees and Commissions Received
Non-cash Loans
Other
Fees and Commissions Paid
Non-cash Loans
Other
DIVIDEND INCOME
TRADING INCOME /(LOSS) (Net)
Gains/(Losses) on Securities Trading
Derivative Financial Transactions Gains/Losses
Foreign Exchange Gains / (Losses)
OTHER OPERATING INCOME
GROSS OPERATING INCOME (III+IV+V+VI+VII)
EXPECTED CREDIT LOSS (-)
OTHER PROVISION EXPENSES (-)
PERSONNEL EXPENSE (-)
OTHER OPERATING EXPENSES (-)
NET OPERATING INCOME/(LOSS) (VIII-IX-X-XI-XII)
AMOUNT IN EXCESS RECORDED AS GAIN AFTER MERGER
PROFIT/LOSS FROM ASSOCIATES ACCOUNTED FOR USING THE EQUITY METHOD
NET MONETARY POSITION GAIN/LOSS
PROFIT/LOSS ON CONTINUING OPERATIONS BEFORE TAX (XIII+...+XVI)
TAX PROVISION FOR CONTINUING OPERATIONS (±)
Current Tax Provision
Deferred Tax Income Effect (+)
Deferred Tax Expense Effect (-)
NET PERIOD PROFIT/LOSS FROM CONTUNUING OPERATIONS (XVI±XVII)
INCOME ON DISCONTINUED OPERATIONS
Income on Assets Held for Sale
Gain on Sale of Associates, Subsidiaries and Jointly Controlled Entities (Joint Ventures)
Other Income on Discontinued Operations
EXPENSE ON DISCONTINUED OPERATIONS (-)
Expense on Assets Held for Sale
Loss on Sale of Associates, Subsidiaries and Jointly Controlled Entities (Joint Ventures)
Other Expense on Discontinued Operations
PROFIT/LOSS ON DISCONTINUED OPERATIONS BEFORE TAX (XX-XXI)
TAX PROVISION FOR DISCONTINUED OPERATIONS (±)
Current Tax Provision
Deferred Tax Expense Effect (+)
Deferred Tax Income Effect (-)
NET PERIOD PROFIT/LOSS FROM DISCONTINUED OPERATIONS (XXII±XXIII)
NET PERIOD PROFIT/LOSS (XIX+XXIV)
Earnings per Share (*)
Foot
notes
V-IV-a
V-IV-b
V-IV-c
V-IV-ç
V-IV-d
V-IV-e
V-IV-e
V-IV-f
V-IV-g
V-IV-ğ
V-IV-h
V-IV-ı
I.
1.1
1.2
1.3
1.4
1.5
1.5.1
1.5.2
1.5.3
1.6
1.7
II.
2.1
2.2
2.3
2.4
2.5
2.6
III.
IV.
4.1
4.1.1
4.1.2
4.2
4.2.1
4.2.2
V.
VI.
6.1
6.2
6.3
VII.
VIII.
IX.
X.
XI.
XII.
XIII.
XIV.
XV.
XVI.
XVII.
XVIII.
18.1
18.2
18.3
XIX.
XX.
20.1
20.2
20.3
XXI.
21.1
21.2
21.3
XXII.
XXIII.
23.1
23.2
23.3
XXIV.
XXV.
(*) Expressed in exact TL
THOUSAND TL
CURRENT PERIOD
(31/12/2022)
PRIOR PERIOD
(31/12/2021)
123.454.753
82.579.909
284.681
444.545
448.198
39.658.335
235.962
24.247.051
15.175.322
0
39.085
48.251.300
32.480.838
2.993.523
3.677.551
5.770.518
362.675
2.966.195
75.203.453
16.146.898
20.770.884
2.257.434
18.513.450
4.623.986
1.461
4.622.525
38.604
4.522.593
3.314.827
-13.543.440
14.751.206
6.080.548
101.992.096
10.036.266
5.768.178
15.095.648
18.933.630
52.158.374
0
21.790.674
0
73.949.048
12.411.168
17.204.130
1.117.479
5.910.441
61.537.880
0
0
0
0
0
0
0
0
0
0
0
0
0
0
61.537.880
0,246149305
60.904.343
44.448.255
849.109
133.704
890
15.434.222
128.118
9.421.203
5.884.901
0
38.163
29.963.074
18.085.126
1.530.274
5.081.676
4.761.496
255.389
249.113
30.941.269
7.619.945
9.742.778
1.291.970
8.450.808
2.122.833
1.521
2.121.312
20.735
-5.149.127
357.107
-1.046.262
-4.459.972
4.401.570
37.834.392
10.837.246
3.612.921
6.366.681
9.545.008
7.472.536
0
8.003.345
0
15.475.881
2.007.986
1.103.778
2.855.911
1.951.703
13.467.895
0
0
0
0
0
0
0
0
0
0
0
0
0
0
13.467.895
0,053871095
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Unconsolidated Statement Of Changes in Shareholders’ Equity
Unconsolidated Statement Of Changes in Shareholders’ Equity
CHANGES IN SHAREHOLDERS’ EQUITY
Foot
notes
Paid-in
Capital
Share
Premium
Accumulated Other Comprehensive Income
That will not be Reclassified in Profit/(Loss)
Accumulated Other Comprehensive Income
That will be Reclassified in Profit/(Loss)
Share
Certificate
Cancellation
Profits
Other
Capital
Reserves
Tangible
assets
accumulated
revaluation
reserve
Increase /
(Decrease)
Accumulated
gains /
(losses) on
remeasurements
of defined
benefit plans
Other (1)
Exchange
differences on
translation reserve
Accumulated gains/
(losses) due to
revaluation and/
or reclassification
of financial assets
measured at fair
value through other
comprehensive
income
Other (2)
Profit Reserves
Prior Period
Profit/(Loss)
Net Current
Period Profit/(Loss)
Total
Shareholder's Equity
4.500.000
90.724
1.035.465
2.719.532
-284.097
1.797.412
1.518.568
1.133.556
2.109.216
40.079.251
13.081.825
67.781.452
4.500.000
90.724
1.035.465
2.719.532
1.445.692
-284.097
1.797.412
-570.558
2.731.426
1.518.568
1.702.150
1.133.556
2.109.216
40.079.251
13.081.825
-473.741
2.433.200
13.467.895
67.781.452
20.736.064
V-V
PRIOR PERIOD ( 31/12/2021)
Beginning Balance
Adjustment in accordance with TAS 8
The Effect of Adjustments
The Effect of Changes in Accounting Policies
New Balance (I+II)
Total Comprehensive Income
Capital Increase in Cash
Capital Increase Through Internal Reserves
Paid-in-Capital inflation adjustment
difference
Convertible Bonds
Subordinated Debt
Increase/(Decrease) Through Other
Changes (*)
Profit Distribution
Dividend Paid
Transfer to Reserves
Other (**)
I.
II.
2.1
2.2
III.
IV.
V.
VI.
VII.
VIII.
IX.
X.
XI.
11.1
11.2
11.3
I.
II.
2.1
2.2
III.
IV.
V.
VI.
VII.
VIII.
IX.
X.
XI.
11.1
11.2
11.3
Ending Balance (III+IV+…...+X+XI)
4.500.000
109.148
1.004.291
4.165.224
-854.655 4.528.838
3.220.718
659.815
4.542.416
46.081.015
18.424
-31.174
6.001.764
6.001.764
-869.736
-6.797.503
-661.415
-6.001.764
-134.324
5.414.586
-882.486
-795.739
-661.415
-134.324
86.839.291
13.467.895
CURRENT PERIOD ( 31/12/2022)
Beginning Balance
Adjustment in accordance with TAS 8
The Effect of Adjustments
The Effect of Changes in Accounting Policies
New Balance (I+II)
Total Comprehensive Income
Capital Increase in Cash
4.500.000
109.148
1.004.291
4.165.224
-854.655 4.528.838
3.220.718
659.815
4.542.416
46.081.015
18.882.481
86.839.291
4.500.000
109.148
1.004.291
4.165.224
-854.655 4.528.838
6.119.976
-1.891.843
8.119.452
3.220.718
2.071.370
659.815
4.542.416
46.081.015
18.882.481
23.898.310
5.517.021
61.537.880
86.839.291
105.372.166
Capital Increase Through Internal Reserves
5.500.000
-5.500.000
Paid-in-Capital inflation adjustment
difference
Convertible Bonds
Subordinated Debt
Increase/(Decrease) Through Other
Changes (*)
Profit Distribution
Dividend Paid
Transfer to Reserves
Other
8
51.703
294.231
17.535.691
17.535.691
126.560
-18.843.575
-1.307.884
-17.535.691
472.502
-1.307.884
-1.307.884
Ending Balance (III+IV+…...+X+XI)
10.000.000
109.156
1.055.994
10.285.200
-2.746.498 12.648.290
5.292.088
24.558.125
10.059.437
58.410.937
165.466
61.537.880
191.376.075
(1): Accumulated amounts of other comprehensive income of investments accounted by the equity method, that will not be reclassified as other profit or loss.
(2): Accumulated amounts of other comprehensive income of investments accounted by the equity method, that will be reclassified as other profit or loss.
(*) Prior Period's Profit / (Loss) for the period 31.12.2021 and Profit Reserves for the period 31.12.2022 include the classifications made within the scope of “TAS 27-Individual Financial Statements”.
(**) According to the Articles of Association of the Bank, it is the dividend amount distributed to the Bank personnel.
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Unconsolidated Statement of Cash Flows
Unconsolidated Statement of Profit Distribution Table
Foot
notes
THOUSAND TL
CURRENT PERIOD
(01/01-31/12/2022)
PRIOR PERIOD
(01/01-31/12/2021)
THOUSAND TL
CURRENT PERIOD
(01/01-31/12/2022)
PRIOR PERIOD
(01/01-31/12/2021)
A.
1.1
1.1.1
1.1.2
1.1.3
1.1.4
1.1.5
1.1.6
1.1.7
1.1.8
1.1.9
1.2
1.2.1
1.2.2
1.2.3
1.2.4
1.2.5
1.2.6
1.2.7
1.2.8
1.2.9
CASH FLOWS FROM BANKING OPERATIONS
Operating Profit Before Changes in Operating Assets and Liabilities
Interest Received
Interest Paid
Dividend Received
Fees and Commissions Received
Other Income
Collections from Previously Written Off Loans and Other Receivables
Cash Payments to Personnel and Service Suppliers
Taxes Paid
Other
Changes in Operating Assets and Liabilities
Net (Increase) / Decrease in Financial Assets at Fair Value Through Profit or Loss
V-VI
Net (Increase) / Decrease in Due From Banks
Net (Increase) / Decrease in Loans
Net (Increase) / Decrease in Other Assets
Net Increase / (Decrease) in Bank Deposits
Net Increase / (Decrease) in Other Deposits
Net Increase/ (Decrease) in Financial Liabilities at Fair Value Through Profit or Loss
Net Increase / (Decrease) in Funds Borrowed
Net Increase / (Decrease) in Matured Payables
1.2.10
Net Increase / (Decrease) in Other Liabilities
V-VI
I.
B.
II.
2.1
2.2
2.3
2.4
2.5
2.6
2.7
2.8
2.9
C.
III.
3.1
3.2
3.3
3.4
3.5
3.6
IV.
V.
VI.
VII.
Net Cash Provided From Banking Operations
CASH FLOWS FROM INVESTING ACTIVITIES
Net Cash Provided from Investing Activities
Cash Paid for the Purchase of Associates, Subsidiaries and Jointly Controlled
Entities (Joint Ventures)
Cash Obtained from Sale of Associates, Subsidiaries and Jointly Controlled
Entities (Joint Ventures)
Cash Paid for the Purchase of Tangible Asset
Cash Obtained from the Sale of Tangible Asset
Cash Paid for Purchase of Financial Assets at Fair Value Through Other
Comprehensive Income
Cash Obtained from Sale of Financial Assets at Fair Value Through Other
Comprehensive Income
Cash Paid for Purchase of Financial Assets Measured at Amortised Cost
Cash Obtained from Sale of Financial Assets Measured at Amortised Cost (*)
Other
CASH FLOWS FROM FINANCING ACTIVITIES
Net cash provided from financing activities
Cash obtained from funds borrowed and securities issued
Cash used for repayment of funds borrowed and securities issued
Equity Instruments
Dividends Paid
Payments for Finance Leases
Other
Effect of change in foreign exchange rate on cash and cash equivalents
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of the period
Cash and cash equivalents at end of the period
V-VI
V-VI
V-VI
(*) Includes Redeemed Financial Assets measured at amortized cost.
29.321.468
103.691.818
-43.427.261
1.451.063
20.771.458
4.926.359
3.384.340
-22.292.589
-13.579.263
-25.604.457
56.755.949
-412.259
-1.407.545
-188.170.365
-1.122.078
5.142.070
238.319.648
0
-14.214.342
0
18.620.820
86.077.417
-75.342.524
-3.714.714
0
-1.325.592
218.743
-59.932.987
27.825.705
-55.070.273
19.171.942
-2.515.348
-31.982.420
10.906.657
-40.429.982
0
-1.667.884
-791.211
0
967.080
-20.280.447
114.894.449
94.614.002
14.064.345
54.774.522
-28.575.621
837.502
9.740.804
999.236
2.802.041
-10.730.457
-2.688.207
-13.095.475
79.007.898
-3.878.212
-16.411.725
-56.752.805
-2.370.308
-1.077.510
127.280.892
0
600.469
0
31.617.097
93.072.243
-7.296.356
-135.636
0
-500.697
223.992
-24.036.024
17.782.022
-15.700.230
15.819.175
-748.958
-15.071.710
7.897.669
-21.609.192
0
-795.739
-564.448
0
-1.171.636
69.532.541
45.361.908
114.894.449
I.
1.1
1.2
1.2.1
1.2.2
1.2.3
A.
1.3
1.4
1.5
B.
1.6
1.6.1
1.6.2
1.6.3
1.6.4
1.6.5
1.7
1.8
1.9
1.9.1
1.9.2
1.9.3
1.9.4
1.9.5
1.10
1.11
1.12
1.13
II.
2.1
2.2
2.2.1
2.2.2
2.2.3
2.2.4
2.2.5
2.3
2.4
III.
3.1
3.2
3.3
3.4
IV.
4.1
4.2
4.3
4.4
DISTRIBUTION OF CURRENT YEAR PROFIT (1)
CURRENT PERIOD PROFIT (2)
TAXES AND DUES PAYABLE (-)
Corporate Tax (Income Tax)
Income Tax Withholding
Other Taxes and Dues Payable (3)
NET PROFIT FOR THE PERIOD (1.1-1.2)
PRIOR YEARS’ LOSSES (-)
FIRST LEGAL RESERVES (-)
OTHER STATUTORY RESERVES (-)
NET PROFIT ATTRIBUTABLE TO [(A-(1.3+1.4+1.5)]
FIRST DIVIDEND TO SHAREHOLDERS (-)
To Owners of Ordinary Shares
To Owners of Preferred Shares
To Preferred Shares (Preemptive Rights)
To Profit Sharing Bonds
To Holders of Profit / Loss Share Certificates
DIVIDENDS TO PERSONNEL (-)
DIVIDENDS TO THE BOARD OF DIRECTORS (-)
SECOND DIVIDEND TO SHAREHOLDERS (-)
To Owners of Ordinary Shares
To Owners of Privileged Shares
To Owners of Preferred Shares
To Profit Sharing Bonds
To Holders of Profit / Loss Share Certificates
STATUTORY RESERVES (-)
EXTRAORDINARY RESERVES
OTHER RESERVES
SPECIAL FUNDS
DISTRIBUTION FROM RESERVES
DISTRIBUTED RESERVES
DIVIDENDS TO SHAREHOLDERS (-)
To Owners of Ordinary Shares
To Owners of Privileged Shares
To Owners of Preferred Shares
To Profit Sharing Bonds
To Holders of Profit / Loss Share Certificates
DIVIDENDS TO PERSONNEL (-)
DIVIDENDS TO THE BOARD OF DIRECTORS (-)
EARNINGS PER SHARE
TO OWNERS OF ORDINARY SHARES (4)
TO OWNERS OF ORDINARY SHARES ( % )
TO OWNERS OF PREFERRED SHARES (4)
TO OWNERS OF PREFERRED SHARES ( % )
DIVIDEND PER SHARE
TO OWNERS OF ORDINARY SHARES (4)
TO OWNERS OF ORDINARY SHARES ( % )
TO OWNERS OF PREFERRED SHARES (4)
TO OWNERS OF PREFERRED SHARES ( % )
73.949.048
12.411.168
17.082.925
121.205
-4.792.962
61.537.880
0
0
0
61.537.880
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0,2461
615
0
0
0
0
0
0
21.250.467
2.007.986
1.057.464
46.314
904.208
19.242.481
0
1.103.071
143.605
17.995.805
270.000
269.998
2
0
0
0
359.481
0
1.076.790
1.076.756
24
10
0
0
0
16.289.534
0
0
0
0
0
0
0
0
0
0
0
0,1197
299
0
0
0,0120
29,93
0,0086
85,87
(1): The decision for dividend payment is made at the Annual General Meeting. Annual General Meeting has not been held as of the reporting date.
(2): In accordance with "TAS 19 Employee Benefits", TL 360.000 allocated for the profit share to be distributed to the personnel in 2021 and added to the profit distribution base of the same year, and TL
5.414.586 retained earnings added to the profit distribution base of the same year are added to the previous period's profit in the table.
(3): Deferred Tax Income.
(4): Expressed in exact TL.
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Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
SECTION THREE: EXPLANATIONS ON ACCOUNTING POLICIES
I.
Basis of Presentation:
The unconsolidated financial statements, related notes, and explanations in this report are prepared in accordance with the “Regulation on Accounting
Applications for Banks and Safeguarding of Documents” and other regulations on accounting records of Banks published by Banking Regulation
and Supervision Agency and circulars and interpretations published by Banking Regulation and Supervision Authority, (together referred as “BRSA
Accounting and Financial Reporting Legislation”) and requirements of Turkish Financial Reporting Standards (TFRS) published the Public Oversight
Accounting and Auditing Standards Authority for the matters not regulated by the aforementioned legislations.
COVID-19 outbreak, which started in China and spread globally in the first half of 2020, caused serious effects on both economic and social life. In
addition to the social life effects of the cautions taken to ensure the control of outbreak in many countries, there are also consequences observed which
is negatively affecting economic activity both on regional and global scale. As in other countries where the pandemic is effective, various cautions also
have been taken in our country in social and economic terms. The Bank sustains its activities for the period precisely by closely monitoring the processes
related to outbreak, postponing retail and non-retail customers' due debts, restructuring with grace period and existing or additional limit allocations
in respect with customers’ needs. Assessments regarding to possible effects of the COVID-19 outbreak through the measurement of expected credit
losses are explained in the Section Three “VIII. “Explanations on Impairment of Financial Assets”.
“Interest Rate Benchmark Reform- Stage 2”, brought changes in various TAS / TFRSs effective from January 1, 2021, was released in December 2020
within the scope of the project of transition of the benchmark interest rates carried out by the International Accounting Standards Board (IASB). It was
concluded that as of December 31, 2022, the changes have not occurred significantly on the Bank's financial statements.
TAS 29 Financial Reporting in Hyperinflation Economies requires entities whose functional currency is that of a hyperinflationary economy to prepare
their financial statements in terms of the measuring unit current at the end of the reporting period. TAS 29 describes characteristics that may indicate
that an economy is hyperinflationary, and it requires all entities that report in the currency of the same hyperinflationary economy apply this Standard
from the same date. Therefore, it is expected that TAS 29 will start to be applied simultaneously by all entities with the announcement of Public Oversight
Accounting and Auditing Standards Authority to ensure consistency of the application required by TAS 29 throughout the country. However, the
Authority has not published any announcement that determines entities would restate their financial statements for the accounting period ending on
31 December 2022 in accordance with TAS 29. In this context, TAS 29 is not applied and inflation adjustment has not been reflected in the financial
statements as of December 31, 2022.
The tension between Russia and Ukraine since January 2022 has turned into a crisis and an armed conflict as of the date of the report. The Bank does
not carry out any activities in these two countries that are subject to the crisis. Considering the geographies in which the Bank operates, the crisis did
not have a direct impact on the Bank's operations as of 31 December 2022. However, since the course of the crisis is still uncertain as of the date of this
report, developments that may occur on a global scale, and the effects of these developments on the global and regional economy and on the Bank's
operations, are closely monitored. Since the Bank's risks to both countries are at a very low level, these developments are not expected to have an
significant impact on the Bank's operations.
The accounting policies applied in the current period are in line with the prior period financial statements. The accounting policies and valuation
principles used in the preparation of financial statements are presented below in detail.
II.
Strategy for Use of Financial Instruments and Foreign Currency Transactions
1. The Bank’s Strategy on Financial Instruments
The Bank’s main activities comprise private, retail, commercial and corporate banking, money market and securities market operations, as well as
activities related to international banking services.
In conformity with the general liability structure of the banking system, the Bank’s liabilities are mainly composed of short-term deposits and other
medium and long-term liabilities. The liquidity risk that may arise from this liability structure can be easily controlled through deposit continuity, as well as
widespread network of the correspondent banks, market maker status (The Bank is one of the market makers banks) and by the use of liquidity facilities
of the Central Bank of Republic of Turkey (“CBRT”). As a result, the liquidity of the Bank and the banking system can be easily monitored. On the other
hand, foreign currency liquidity requirements are met by the money market operations and currency swaps.
Most of the funds collected bear fixed interest, and by closely monitoring the developments in the sector, both fixed and floating rate placements are
made based on the yields of alternative investment instruments.
Safety principle has always been the top priority in placements and the placements are focused on high yielding and low risk assets by considering
their maturity structure. Accordingly, a pricing policy aiming at high return is implemented in the long-term placements and attention is paid to the
maximum use of non-interest income generation opportunities. The Bank determines its lending strategy by taking into consideration the international
and national economic data and expectations, market conditions, current and potential credit customers’ expectations and tendencies, and risks such as;
interest rate, liquidity, currency and credit risks. Furthermore, in conformity with this strategy, the Bank acts within the legal limits in terms of asset-liability
management.
The primary objectives related to balance sheet components are set by the long-term plans shaped along with budgeting; and the Bank takes the
required positions against the short-term currency, interest rates and price fluctuations in accordance with these plans and the course of the market
conditions.
Foreign currency, interest rate and price fluctuations in the markets are monitored instantaneously. While taking positions, in addition to the legal limits, the
Bank’s own transaction and control limits are also effectively monitored in order to avoid limit overrides.
The Bank’s asset-liability management is executed by the Asset-Liability Management Committee, within the risk limits determined by the Board of
Directors, in order to keep the liquidity risk, interest rate risk, currency risk and credit risk within certain limits depending on the equity adequacy and to
maximize profitability.
2. Foreign Currency Transactions
Foreign currency monetary assets and liabilities on the balance sheet are converted into Turkish Lira by using the prevailing exchange rates at the balance
sheet date. Non-monetary items in foreign currencies carried at fair value are converted into Turkish Lira by the rates at the date of which the fair value is
determined. Exchange rate differences arising from the conversions of monetary foreign currency items and the collections of and payments in foreign
currency transactions are reflected to the income statement.
The Bank started to apply equity method for the foreign associates and subsidiaries which were followed with historical rates in accordance with the TAS
27 “Separate Financial Statements” In this context, foreign subsidiaries are accounted at current rates in the financial statement and the resulting exchange
differences are accounted under equity.
The financial statements of the foreign branches of the Bank are prepared in the currency of the primary economic environment in which the entity operates
(functional currency). The financial statements of foreign branches are expressed in TL which is the functional currency of the Bank and the presentation
currency of the financial statements. Assets and liabilities of the foreign branches of the Bank are converted into TL by using the prevailing exchange rates
at the balance sheet date. Income and expenses are converted by at exchange rates at the dates of the transactions. The exchange rate differences arising
from the conversion are recorded in the shareholders’ equity.
III.
Associates and Subsidiaries
The Bank accounts, its associates, and subsidiaries in accordance with equity method which described in TAS 28.
Under the equity method, Bank’s share of net assets of the associates and subsidiaries is recognized in the Bank’s financial statements. The profit or loss of
the Bank includes the Bank’s share of the profit or loss of the associates and subsidiaries and Bank’s other comprehensive income or expenses include the
Bank’s share of other comprehensive income or expenses of the associates and subsidiaries. Mergers / acquisitions and change in share ratios of related
associates and subsidiaries during the period are shown under the item "Increase / Decrease through Other Changes" in the statement of changes in
shareholders’ equity.
IV.
Forward, Option Contracts and Derivatives Instruments
Derivative transactions of the Bank consist of foreign currency and interest rate swaps, forwards, foreign currency options and interest rate options. The
Bank has no derivative instruments decomposed from the main contract.
The Bank classifies derivative transactions, which act as a hedge but does not meet qualification criteria for hedge accounting, as "Derivative Financial
Assets at Fair Value through Profit or Loss" in accordance with the “TFRS 9 Financial Instruments” requirements.
Derivative transactions are recorded at their fair value at the date of contract, receivables and payables arising from these transactions are recorded in
off-balance sheet accounts. Derivative transactions are measured at fair value at subsequent reporting dates and if the valuation difference is positive, they
are classified as "Derivative Financial Assets at Fair Value through Profit or Loss", if it is negative they are classified as "Derivative Financial Liabilities at Fair
Value through Profit or Loss". The differences arising from the valuation of derivative transactions are associated with the income statement.
On off-balance sheet items table, options which generated assets for the Bank are presented under “call options” line and which generated liabilities are
presented under “put options” line.
V.
Interest Income and Expenses
Interest income is calculated by using the effective interest rate method (the rate that equal the future cash flows of a financial asset or liability to its present
net book value) to gross carrying amount of financial asset in conformity with “TFRS 9 Financial Instruments” except financial asset that is not a purchased
or originated credit-impaired financial asset but subsequently has become credit-impaired.
Under the scope of TFRS 9 application, the Bank does not reverse the interest accruals and rediscounts of non-performing loans and other receivables and
monitors the related amounts under interest income and calculates expected credit loss on these amounts according to the related methodology.
VI.
Fees and Commission Income and Expenses
Wages and commissions those that are not an integral part of the effective interest rate of the financial instruments measured at amortized cost are
accounted for in accordance with "TFRS 15 - Revenue from Customer Contracts". Fees and commission income and expenses are recognized either on
accrual basis or by using the effective interest method. Income earned in return for services rendered contractually or due to operations like sale or purchase
of assets on behalf of a third-party real person or corporate body are recognized in income accounts in the period of collection.
VII.
Financial Assets
The Bank within the scope of “TFRS 9 Financial Instruments”, classifies and accounts its financial assets as “Financial Assets at Fair Value Through Profit or
Loss”, “Financial Assets at Fair Value Through Other Comprehensive Income” or “Financial Assets at Measured at Amortized Cost” by taking into account
their business model and contractual cash flow characteristics. Financial assets are recognized or derecognized according to TFRS 9 “Recognition and
Derecognition in Statement of Financial Position” requirements. The Bank recognizes a financial asset in its statement of financial position when it becomes
a party to the contractual provisions of the financial instrument. Financial assets are measured at their fair value on initial recognition in the financial
statements.
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Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
The Bank has three different business models for classification of financial assets:
ੵ Business model aimed at holding financial assets in order to collect contractual cash flows: Financial assets held under the mentioned business model
are managed to collect contractual cash flows over the life of these assets. The Bank manages its assets held under this portfolio in order to collect
certain contractual cash flows
ੵ Business model aimed at collecting contracted cash flows of financial assets and selling: In this business model, the Bank intends both to collect
contractual cash flows of financial assets and to sell these assets.
ੵ Other business models: A business model in which financial assets; are not held within the scope of a business model aimed at collection of
contractual cash flows and within the scope of a business model aimed at collecting and selling contracted cash flows, are measured by reflecting fair
value in profit or loss.
The Bank is able to reclassify all affected financial assets in case it changes the business model that is used for the management of financial asset.
In the event of the termination of the rights related to the cash flows from a financial asset, the transfer of all risks and rewards of the financial asset to a
significant extent or has no longer control of the financial assets, the Bank derecognizes the financial asset.
1. Financial Assets at Fair Value Through Profit or Loss
Financial assets except financial assets measured at amortized cost or at fair value through other comprehensive income, are measured at fair value
through profit or loss. Financial assets at fair value through profit or loss are financial assets held for the purpose of generating profit from short-term
fluctuations in price or similar factors in the market or being part of a portfolio for profitability in the short term, regardless of the acquisition reason or
financial assets that are not held in a business model that aims at collecting and/or selling contractual cash flows of financial assets.
Financial assets at fair value through profit or loss are initially measured at fair value on the balance sheet and are subsequently re-measured at fair
value. Gains or losses arising from the valuation are related to profit and loss accounts.
In some cases, restructuring, alteration or counterparty changes of contractual cash flows of loans may lead to derecognition of related loans in
accordance with TFRS 9. When the change in the financial asset results from derecognizing the existing financial asset from the financial statements
and the revised financial asset is recognized in the financial statements, the revised financial asset is considered as a new financial asset in accordance
with TFRS 9. When it is determined that there are significant changes between the new conditions of the revised financial asset and the first conditions
in related agreements, the Bank evaluates the new financial asset according to the current business models. When it is determined that the contractual
conditions do not only result in cash flows that include principal and interest payments at certain dates, the financial asset is recognized at fair value and
is subject to valuation. The differences arising from the valuation are reflected in the nominal accounts.
The Bank recognizes loans at fair value through profit or loss, if the contractual terms of the loan, do not result in cash flow including the principal
payments and interest payments generated from principal amounts at certain dates. These loans are valued at their fair values after their recognition and
the losses or gains arising from the valuation are included in the profit and loss accounts.
2. Financial Assets at Fair Value Through Other Comprehensive Income
Financial assets at fair value through other comprehensive income are financial assets that are held under a business model that aims both to collect
contractual cash flows and to sell financial assets, and financial assets with contractual terms that lead to cash flows that are solely payments of
principal and interest on the principle amount outstanding at specific dates.
Financial assets at fair value through other comprehensive income are initially recognized at their fair value including their transaction costs on the
financial statements. The initial recognition and subsequent valuation of such financial assets, including the transaction costs, are carried out on a fair
value basis and the difference between amortized cost and the cost of borrowing instruments is recognized in profit or loss by using the effective interest
method. Dividend income arising from investments in equity instruments that are classified as at fair value through other comprehensive income is also
recognized in income statements.
Gains and losses, except impairment gain or loss and foreign exchange gain or loss, arising from changes in the fair value of financial assets at fair value
through other comprehensive income are reflected to other comprehensive income until derecognized or reclassified. When the value of the financial
asset is collected or financial asset is disposed, the related fair value differences accumulated in the shareholders’ equity are transferred to the profit or
loss statement.
During the initial introduction to financial statements, amendments to the fair value of an investment in an equity instrument within the framework of
TFRS 9 that are not held for trading or that are not valued in a financial statement of an entity that acquires business combinations under the “TFRS 3
Business Combinations” may be subject to an irreversible preference regarding these amendments being accounted in other comprehensive income. In
such case dividends taken from mentioned investment will be accounted in financial statement as profit or loss.
3. Financial Assets Measured at Amortized Cost
Financial assets measured at amortized cost are those financial assets that are held within the framework of a business model aimed at collecting
contractual cash flows over the life of the asset and which result in cash flows that include principal and interest on the principal amount outstanding at
specific dates. Financial assets measured at amortized cost with the initial recognition at fair value including transaction costs are subject to valuation
with their discounted cost value by using the effective interest rate method, after eliminating any provision for impairment if there is any. Interest income
measured by using the effective interest rate method are recognized in the income statement as an “interest income”.
The Bank evaluates its loans within the framework of current business models and can be classified as Financial Assets measured at Amortized Cost.
The Bank also holds consumer price indexed government bonds (“CPI”) in its securities portfolio, reclassified as financial assets measured at fair value
through other comprehensive income, financial assets measured at fair value through profit or loss and financial assets measured at amortised cost. In
the valuation of the mentioned securities, the estimated inflation curve created by using the CPI index announced by Turkish Statistical Institute (“TÜİK”)
and the “Annual CPI Expectation After 12 Months” from the CBRT Market Participants Survey is used. Future cash flows of securities are estimated by
using the mentioned inflation data and valuation is made according to the effective interest method within the framework of the reference inflaiton index
formula specified in the Undersecretariat of Treasury’s Investor Guide of CPI.
VIII.
Impairment of Financial Assets
In accordance with the “TFRS 9-Financial Instruments” and the regulation and related decision “Procedures and Principals regarding Classification of
Loans and Allowances Allocated for Such Loans” issued by BRSA, the Bank recognizes expected credit loss allowance on financial assets at fair value
through other comprehensive income, financial assets measured at amortized cost, impaired credit commitments and financial guarantee contracts.
Within the scope of TFRS 9, the expected credit loss is calculated according to the “three-stage” impairment model based on the change in the loan
quality of financial assets after initial recognition and detailed in the following headings:
Stage 1:
An important determinant for calculating the expected credit loss in accordance with TFRS 9 is to assess whether there is a significant increase in the
credit risk of the financial asset. Financial assets that have not experienced a significant increase in credit risk since the initial recognition are monitored
in the stage one. Impairment for credit risk for the Stage 1 financial assets is equal to the 12-month expected credit losses.
Stage 2:
Financial assets that experienced a significant increase in the credit risk since initial recognition, are transferred to Stage 2. The expected credit loss of
these financial assets are measured at an amount equal to the instrument’s lifetime expected credit loss. In order to classify a financial asset in the stage
2, the following criteria is considered:
ੵ Overdue between 30-90 days
ੵ Restructuring of the loan
ੵ Significant deterioration in the probability of default
In case of a significant deterioration in the probability of default, the credit risk is considered to be increased significantly and the financial asset is
classified as stage 2. The absolute and gradual thresholds used to increase the probability of default are differentiated on the basis of portfolio and
product group. In this manner, for the commercial portfolio, definition of increase in the probability of default is the comparison between the probability
of default on loan’s opening date, obtained from the integrated rating/score based on internal rating and probability of default of the same loan on
reporting date, obtained from the integrated rating/score based on internal rating. For the individual portfolio, it is accepted that the probability of default
is worsened in cases where the behavioral score falls below the thresholds determined on the basis of the product and the probability of default exceeds
the thresholds determined on the basis of the product.
Stage 3:
Financial assets with sufficient and fair information for impairment at the reporting date, are classified in the third stage. Expected credit loss of these
financial assets is measured at an amount equal to the lifetime expected credit loss. The following basic factors are considered for the classification of a
financial asset in the third stage:
ੵ More than 90 days past due
ੵ Whether the credit rating is weakened, has suffered a significant weakness or cannot be collected or there is a certain opinion on this matter
While estimating the expected credit loss, statistical models, methods and tools are used in accordance with the relevant legislation and accounting
standards. Expected credit loss is measured using reasonable and supportable information by taking current and forecasts of future economic
information into consideration, including macroeconomic factors. Three scenarios, base scenario, optimistic scenario and the worst scenario, are
used in forecasting studies made by macroeconomic models. The variables used in these macroeconomic estimates Industrial Production Index,
Employment Ratio and Credit Default Swap indicators. The validity of the risk parameter estimates used in the calculation of expected credit losses
is reviewed and evaluated at least annually within the framework of model validation processes. Macroeconomic forecasts and risk delinquency
data used in risk parameter models are re-evaluated every quarter to reflect the changes in economic conjuncture and are updated if needed. In this
framework, necessary updates were made in 2022. Except for demand or revolving loans, the maximum period for which expected credit losses are
to be determined is the contractual life of the financial asset. For demand or revolving loans, maturity is determined by taking the future risk mitigation
processes into account such as behavioral maturity analyses performed by the Bank and cancellation/revision of the Bank’s credit limit.
While calculating the expected credit loss, aside from assessment of whether there is a significant increase in credit risk or not, basic parameters
expressed as probability of default, loss given default and exposure at default are used.
Probability of Default: Represents the probability of default on the loan over a specified time period. In this context, the Bank has developed models
to calculate 12-month and life-time default probabilities by using internal rating based credit rating models. As for the Group Companies historical
probability of default data has also been observed.
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Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Loss Given Default (LGD): Defined as the damage caused by the default of borrower to the total balance of the exposure at the time of default. The
LGD estimates are determined in terms of credit risk groups that are detailed in the Bank’s data resources and system facilities. The model used for the
estimation of the LGD was established by taking into account the direct cost items during the collection process, based on the historical data of the
Bank’s collection, cash flows are discounted at effective interest rates.
Exposure at Default: For cash loans, the cash balance at the date of report, for non-cash loans the balance calculated using the Credit Conversion
Factor (CCF) is represented by Exposure at Default.
Credit Conversion Factor: Calculated for non-cash loans (undrawn limit for revolving loans, commitments, non-cash loans etc.) The historical limit
usage data of the Bank for revolving loans are analyzed and the limit amount that can be used until the moment of default is estimated. For non-cash
loans, the cash conversion ratio of the loan amount is estimated by analyzing the product type and the past compensation amount of the bank.
Credit risks, which require qualitative assessments due to their characteristics and differ by grouping in this manner, are considered as individual within
the internal policies. Calculations are made by the method of discounted cash flows with the effective interest rate expected from the relevant financial
instrument. Discounted cash flows are estimated for 3 different scenarios in which parameters are differentiated, and individual expected credit loss is
calculated by taking into consideration the cash deficit amounts weighted according to probabilities.
As mentioned above, the Bank allocated expected credit losses by reflecting additional provisions through individual assessments performed for the
customers that operates in sectors where the impact might be high in accordance with the Bank’s risk policies.
Expected credit loss is reflected in the income statement. Released provisions in the current year are accounted under “Expected Credit Loss Expenses”
and released provision which is carried from the prior year are accounted under “Other Operating Income”.
Receivables evidenced through the Legal Process that collection is not possible can be written-off by fulfilling the requirements of the Tax Procedure
Law. Besides, the loans for which specific provision is allocated and for which there is no reasonable expectation of recovery might be written-off.
IX.
Offsetting Financial Instruments
Financial assets and financial liabilities shall be offset, and the net amount shall be presented in the balance sheet only when a party currently has
a legally enforceable right to set off the recognized amounts or intends either to settle on a net basis or to realize the asset and settle the liability
simultaneously.
X.
Sale and Repurchase Agreements and Securities Lending Transactions
Marketable securities subject to repurchase agreements are classified under “Financial Assets at Fair Value through Profit and Loss”, “Financial Assets
at Fair Value through Other Comprehensive Income” or “Financial Assets Measured at Amortised Cost” in the Bank’s portfolio and they are valued
according to the valuation principles of the related portfolios.
Funds obtained from the repurchase agreements are recognized under “Funds from Repurchase Transactions” account in liabilities. For the difference
between the sale and repurchase prices determined by the repo agreements for the period; expense accrual is calculated using the effective interest rate
method.
Reverse repo transactions are recognized under the “Receivables from Reverse Repo Transactions” account. For the difference between the purchase
and resale prices determined by the reverse repo agreements for the period; income accrual is calculated using the effective interest rate method.
XI.
Non-current Assets Held for Sale and Discontinued Operations and Related Liabilities
Assets that meet the criteria to be classified as held for sale within the scope of “TFRS 5 – Non-current Assets Held for Sale and Discontinued
Operations” are measured at the lower one of their fair value and their carrying amount which from the costs to sell are deducted and presented
separately within the financial statements. In order to classify a tangible fixed asset as held for sale, the asset (or the disposal group) should be available
for an immediate sale in its present condition subject to the terms of any regular sales of such assets (or such disposal groups) and the sale should be
highly probable. For a highly probable sale, the appropriate level of management must be committed to a plan to sell the asset (or the disposal group),
and an active programme to complete the plan should be initiated to locate a customer. Also, the asset (or the disposal group) should have an active
market sale value, which is a reasonable value in relation to its current fair value. Events or circumstances may extend the completion of the sale more
than one year. Such assets are still classified as held for sale if there is sufficient evidence that the delay in the sale process is due to the events and
circumstances occurred beyond the control of the entity or the entity remains committed to its plan to sell the asset (or disposal group).
A discontinued operation is a component of a bank that either has been disposed of or is classified as held for sale. Gains or losses relating to
discontinued operations are presented separately in the income statement.
XII.
Goodwill and Other Intangible Assets
As at the balance sheet date, there is no goodwill recorded in the unconsolidated balance sheet of the Bank.
The Bank’s intangible assets consist of software programs. The purchased items are presented with their acquisition costs less the accumulated
amortization and impairment provisions. In case there is an indication of impairment, the recoverable amount of the related intangible asset is estimated
within the framework of “TAS 36 –Impairment of Assets” and impairment provision is set aside in case the recoverable amount is below its acquisition
cost.
The related assets are amortized by the straight-line method considering the estimated useful life. The amortization method and period are periodically
reviewed at the end of each year.
XIII.
Tangible Assets
The Bank follows its real estates in use, which are recorded under tangible fixed assets, according to the revaluation model within the framework of "TAS
16 – Property, Plant and Equipment" since 2015. The positive difference between the net book value of real estate property values and the renewed
expertise values which are determined by the licensed valuation in 2022, companies are recorded under the shareholders’ equity.
In case there is an indication of impairment, the recoverable amount of the related intangible asset is estimated within the framework of “TAS 36 –
Impairment of Assets” and impairment provision is set aside in case the recoverable amount is below its acquisition cost.
Tangible assets other than the land and construction in progress are amortized at the straight-line method, according to their estimated useful lives. The
estimated useful life, residual amount and the method of amortization are reviewed every year for the possible effects of the changes that occur in the
estimates and if there is any change in the estimates, they are recognized prospectively.
Assets held under finance lease are depreciated over the expected useful life of the related assets.
Assets subject to leasing are depreciated according to relevant contract periods.
Leasehold improvements are amortized in equal amounts considering their useful life. However, in any case the useful life cannot exceed leasing term.
When the lease period is not certain or longer than 5 years, the amortization period is recognized as 5 years.
The difference between the sales proceeds arising from the disposal of tangible assets or the inactivation of a tangible asset and the book value of the
tangible assets are recognized in the income statement.
Regular maintenance and repair costs incurred for tangible assets are recognized as expense.
There are no pledges, mortgages and similar encumbrances on tangible assets.
The “Regulation on Procedures and Principles for the Trading of Precious Metals by Banks and the Disposal of Commodities and Real Properties
acquired by Banks due to their Receivables” has been abolished by BRSA effective from January 1, 2017. Real properties acquired by Group due to their
receivables and not treated in the scope of “TFRS 5 - Non-current Assets Held for Sale and Discontinued Operations" has been started to follow under
“Other Assets” in accordance with the related accounting standard from the current period.
The depreciation rates used in amortization of tangible assets and their estimated useful lives are as follows:
Tahmini Ekonomik Ömür (Yıl)
Amortisman Oranı
Binalar
Kasalar
Diğer Menkuller
XIV.
Leasing Transactions
50
2-50
2-25
%2
%2 - %50
%4 - %50
Assets acquired through financial leases are carried at the lower of their fair values or amortized value of the lease payments. Leasing payables are
recognized as liabilities in the balance sheet while the interest payable portion of the payables is recognized as a deferred amount of interest. Finance
lease payments are separated as financial expense and principal amount payment, which provides a decrease in finance lease liability, thus helps a fixed
rate interest on the remaining principal amount of the debt to be calculated. Within the context of the Bank’s general borrowing policy, financial expenses
are recognized in the income statement. Assets held under financial leases are recognized under the “Property, Plant and Equipment” account and are
depreciated by using the straight-line method.
The Bank does not participate in the financial leasing transactions as a “lessor”.
The Bank accounts its operating leases in accordance with the TFRS 16 "leases" standard. Operating leases within the framework of the
aforementioned standard are monitored in a similar manner to financial leases. For the agreements within the scope of TFRS 16, the right of use asset
and the lease payments are reflected to the financial statements and they are presented under "Tangible Assets" and "Liabilities from Financial Leases",
respectively. The lease liability is calculated by discounting the future lease payments by the use of the Bank or alternative borrowing interest rates at the
date of initial application or contract date. Fixed assets, which are accounted as right of use assets, are subject to depreciation considering the period of
the contract. Interest expenses and foreign exchange differences related to the lease liabilities are associated with profit and loss statement.
XV.
Provisions and Contingent Liabilities
As of the end of the reporting period, a past event is deemed to give rise to a present obligation if, taking account of all available evidence, it is more likely
than not that a present obligation exists, the entity recognizes a provision in the financial statements. As of the end of the reporting period where it is
more likely that no present obligation exists at the end of the reporting period, the entity discloses a contingent liability on footnotes unless the possibility
of an outflow of resources embodying economic benefits is remote.
In the financial statements, a provision is made for an existing commitment resulted from past events if it is probable that the commitment will be settled,
and a reliable estimate can be made of the amount of the obligation.
Provisions are calculated based on the reliable estimates of management on the expenses to incur as of the balance sheet date to fulfill the liability by
considering the risks and uncertainties related to the liability. In case the provision is measured by using the estimated cash flows required to fulfill the
existing liability, the book value of the related liability is equal to the present value of the related cash flows.
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216 İşbank 2022 Integrated Annual Report
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Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
If the amount is not reliably estimated and there is no probability of cash outflow from the Bank to settle the liability, the related liability is considered as
“contingent” and disclosed in the notes to the financial statements.
XVI. Contingent Assets
The contingent assets usually arise from unplanned or other unexpected events that give rise to the possibility of an inflow of economic benefits to the
Bank. Since showing the contingent assets in the financial statements may result in the accounting of an income, which will never be generated, the
related assets are not included in the financial statements, but if there is a possibility that an inflow of economic benefits of these assets may occur then
it is explained in the footnotes of the financial statements. Nevertheless, the developments related to the contingent assets are constantly evaluated and
if it has become virtually certain that an inflow of economic benefits will arise, the asset and the related income are recognized in the financial statements
of the period in which the change occurs.
XVII. Liabilities Regarding Employee Benefits
1. Severance Indemnities and Short-Term Employee Benefits
According to the related regulation and the collective bargaining agreements, the Bank is obliged to pay termination benefits for employees who retire,
die, quit for their military service obligations, who have been dismissed as defined in the related regulation or (for the female employees) who have
voluntarily quit within one year after the date of their marriage. Within the scope of “TAS 19-Employee Benefits”, the Bank allocates severance indemnity
provisions for employee benefits by estimating the present value of the probable future liabilities. According to TAS 19, all actuarial gains and losses
occurred are recognized under shareholder’s equity. The Bank also allocates provision for the unused paid vacation.
2. Retirement Benefit Obligations
Türkiye İş Bankası A.Ş. Emekli Sandığı Vakfı (“İşbank Pension Fund”), of which each Bank employee is a member, has been established according to the
provisional Article 20 of the Social Security Act No. 506. As per provisional article numbered 23 of the Banking Law numbered 5411, it is ruled that Bank
pension funds, which were established within the framework of Social Security Act, will be transferred to the Social Security Institution, within 3 years
after the publication of such law. Methods and principles related to transfer have been determined as per the Cabinet decision dated 30 November
2006 numbered 2006/11345. However, the related article of the act has been cancelled upon the President’s application dated November 2, 2005, by
the Supreme Court’s decision dated March 22, 2007, numbered E.2005/39, K.2007/33, which was published on the Official Gazette dated March 31,
2007, and numbered 26479 and the execution decision was ceased as of the issuance date of the related decision.
After the justified decree related to cancelling the provisional Article 23 of the Banking Law was announced by the Constitutional Court on the Official
Gazette dated December 15, 2007 and numbered 26731, Turkish Grand National Assembly started to work on establishing new legal regulations, and
after it was approved at the General Assembly of the TGNA, the Law numbered 5754 “Emendating Social Security and General Health Insurance Act
and Certain Laws and Decree Laws”, which was published on the Official Gazette dated 8 May 2008 and numbered 26870, came into effect. The new
law decrees that the contributors of the Bank pension fund, the ones who receive salaries or income from these funds and their rightful beneficiaries will
be transferred to the Social Security Institution and will be subject to this Law within 3 years after the release date of the related article, without any need
for further operation. The three-year transfer period can be prolonged for maximum 2 years by the Cabinet decision. However related transfer period
has been prolonged for 2 years by the Cabinet decision dated March 14, 2011, which was published on the Official Gazette dated April 9, 2011, and
numbered 27900. In addition, by the Law “Emendating Social Security and General Health Insurance Act”, which was published on the Official Gazette
dated March 8, 2012 and numbered 28227, this period of 2 years has been raised to 4 years after that related transfer period has been prolonged for
one more year by the Cabinet decision dated April 8, 2013, which was published on the Official Gazette dated 3 May 2013 and numbered 28636 also
this period has revalidated one more year by the Cabinet decision dated February 24, 2014, which was published on the Official Gazette dated April 30,
2014 and numbered 28987. The Council of Ministers has been lastly authorized to determine the transfer date in accordance with the last amendment
in the first paragraph of the 20th provisional article of Law No.5510 implemented by the Law No. 6645 on Amendment of the “Occupational Health
and Safety Law and Other Laws and Decree Laws” published in the Official Gazette dated April 23, 2015, and numbered 29335. This authority was
transferred to the President with the delegated legislation No.703 which was published in the repetitive Official Gazette No. 30473 dated July 9, 2018.
On the other hand, the application made on 19 June 2008 by the Republican People’s Party to the Constitutional Court for the annulment and motion
for stay of some articles, including the first paragraph of the provisional article 20 of the Law, which covers provisions on transfers, was rejected in
accordance with the decision taken at the meeting of the afore-mentioned court on 30 March 2011.
The aforementioned Law also states that;
ੵ Through a commission constituted by the attendance of one representative separately from the Social Security Institution, Ministry of Finance, Turkish
Treasury, State Planning Organization, Banking Regulation and Supervision Agency, Savings Deposit Insurance Fund, one from each pension fund, and
one representative from the organization employing pension fund contributors, related to the transferred persons, the cash value of the liabilities of the
pension fund as of the transfer date will be calculated by considering their income and expenses in terms of the lines of insurance within the context of
the related Law, and technical interest rate of 9.8% will be used in the actuarial calculation of the value in cash,
ੵ And that after the transfer of the pension fund contributors, the ones who receive salaries or income from these funds and their rightful beneficiaries to
the Social Security Institution, these persons’ uncovered social rights and payments, despite being included in the trust indenture that they are subject
to, will be continued to be covered by the pension funds and the employers of pension fund contributors. .
In line with the new law, the Bank obtained a technical actuarial valuation report from the licensed actuary for the year ended December 31, 2022. In
related period’s financial statements, Bank provided full provision for the total amount of technical and actual deficit stated in the actuarial report of the
aforementioned period. The actuarial assumptions used in the related actuarial report are given in Section Five Note II-i-4.1.
İşbank Members’ Supplementary Pension Fund has been founded to provide beneficiaries with additional social security and solidarity rights to
compulsory social security benefits as per the provisions of the Turkish Commercial Code and Turkish Civil Code.
XVIII. Taxation
1. Corporate Tax:
In accordance with the Provisional Article 13 added to the Corporate Tax Law Numbered 5520 with the Law Numbered 7316, the 20% rate foreseen
in the calculation of the corporate tax for the corporate earnings of the 2021 taxation period is determined as 25% (starting from the declarations to be
submitted as of July 1, 2021 and to be valid for the corporate earnings for the taxation period starting from January 1, 2021), and as 23% for the corporate
earnings for the 2022 taxation period. On the other hand, in accordance with the amendment made in Article 32 of the Corporate Tax Law with the Law
No. 7394 published in the Official Gazette dated 15.04.2022 and numbered 31810, the corporate tax rate should start from the declarations that must
be submitted as of 01.07.2022 and taxation starting from 01.01.2022. It has been determined as 25% to be valid for the corporate earnings of the period.
In this context, the Corporate Tax rate valid for the period of December 31, 2022, is 25%.
As per the Corporate Tax law, temporary tax is calculated and paid quarterly in line with the principles of the Income Tax Law and at the corporate tax
rate. The temporary tax payments are deducted from the current period’s corporate tax. The 4th provisional tax for the year 2022 will be paid in February
2023 for to be deducted from the corporate tax of the current taxation period.
Tax expense consists of current tax and deferred tax. The current tax liability is calculated over the portion of the period subject to taxation. The taxable
profit differs from the profit stated in the income statement, as the income and expense items that can be taxable or deductible at other periods, and
items that are not taxable or deductible are excluded. The current tax amounts payable is netted off with prepaid tax amounts and presented on the
financial statements.
Within the framework of the Corporate Tax Law numbered 5520, 75% of the gains on the sale of the participation shares, which were held in the assets
for a minimum of 2 whole years and 75% of the gains on the sale of immovable are exempt from tax provided that they are added to the capital as set
forth by the Law or that they are kept in a special fund under liabilities for a period of 5 years. However, in accordance with Article 89 / a of the Law No.
7061 and Article 5.1.e and Article 5.1.f of the Corporate Tax Law, which were published in the Official Gazette dated December 5, 2017, and numbered
30261, the 75% applied in terms of immovable sales mentioned above has been reduced to 50% which is effective from the date of publication of the
Law.
In accordance with the provision of Article 298 / A of the Tax Procedure Law, the necessary conditions for inflation adjustment in the calculation of
corporate tax as of the end of the 2021 calendar year have been met. However, the application of inflation adjustment in the calculation of corporate tax
was postponed to 2023 with the regulation made with the "Law on the Amendment of the Tax Procedure Law and the Corporate Tax Law" numbered
7352 published in the Official Gazette dated 29.01.2022 and numbered 31734. Accordingly, VUK (Tax Procedure Law) financial statements for the 2021
and 2022 accounting periods, including the provisional tax periods, will not be subject to inflation adjustment, and the 2023 accounting period will not
be subject to inflation adjustment as of the temporary tax periods. will be subject to inflation adjustment regardless.
2. Deferred Tax:
Deferred tax asset or liability is determined by calculating the tax effects of temporary differences between the carrying amounts of assets and liabilities
in the financial statements and the amounts considered in the legal tax base account, by taking the legal tax rates into account. Deferred tax liabilities
are generally recognized for all taxable temporary differences and deferred tax assets are recognized to the extent that it is probable that taxable profits
will be available against which deductible temporary differences can be utilized. Free provisions that are allocated for possible future risks are not subject
to deferred tax calculation. No tax assets or liabilities are recognized for the temporary timing difference that affects neither the taxable profit nor the
accounting profit and that arises from the initial recognition in the balance sheet, of assets and liabilities, other than the goodwill and mergers. The Bank
calculates deferred tax for the provisions allocated for Stage 1 and Stage 2 expected credit loss.
The carrying values of deferred tax assets are reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient
taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax is measured at enacted tax rates prevailing in the period or about to be enacted when the assets are realized or liabilities are settled, and the
tax is recognized as income or expense in the income statement. Nonetheless, if the deferred tax is related to assets directly associated with the equity in
the same or different period, it is directly recognized in the equity accounts.
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Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
In accordance with the Provisional Article 13 added to the Corporate Tax Law Numbered 5520 with the Law Numbered 7316, the 20% rate foreseen
in the calculation of the corporate tax for the corporate earnings of the 2021 taxation period is determined as 25% (starting from the declarations to be
submitted as of July 1, 2021 and to be valid for the corporate earnings for the taxation period starting from January 1, 2021), and as 23% for the corporate
earnings for the 2022 taxation period. On the other hand, in accordance with the amendment made in Article 32 of the Corporate Tax Law with the Law
No. 7394 published in the Official Gazette dated 15.04.2022 and numbered 31810, the corporate tax rate should start from the declarations that must
be submitted as of 01.07.2022 and taxation starting from 01.01.2022. It has been determined as 25% to be valid for the corporate earnings of the period.
The Bank has calculated deferred tax by using 25% rate (December 31, 2021: 20%, 23%, and 25% rates are used).
Deferred tax assets and liabilities are shown in financial tables by way of offsetting.
3. Tax Practices in the Countries that Foreign Branches Operate:
Turkish Republic of Northern Cyprus (TRNC)
In accordance with TRNC tax legislation, 15% income tax is accrued on the remaining tax base after 10% corporate tax is deducted from corporate
income. The tax bases for companies are determined by adding the expenses that cannot be deducted according to TRNC regulations, to commercial
gains and by subtracting exemptions and deductions from commercial gains. Income tax is paid in June, and corporate tax payment is made in two
equal installments, in May and in October. On the other hand, withholding tax is paid in TRNC over interest income and similar gains of the companies.
The related withholding tax payments and provisional tax paid every quarter during the year are deducted from corporate tax payable and the difference
between withholding and provisional tax amounts and corporate tax payable is discounted from income tax provided that the withholding tax and paid
provisional tax amounts are higher than corporate tax amount.
England
Corporate earnings are subject to 19% corporate tax in England. The relevant rate is applied to the tax base that is determined by adding the expenses
that cannot be deducted due to the regulations, to commercial gains and by subtracting exemptions and deductions from commercial gains. In other
respect, if the tax base calculated in accordance with the country legislation is within a certain range, the temporary corporate tax is paid in July, October
of the relevant year and in January and April of the following year; If it is over a certain amount, it is paid in 4 installments in March, June, September and
December of the relevant year. The corporate tax amount must be finalized and paid by the end of September of the year following the year of profit. In
case the corporate tax payable as a result of the calculation is below the temporary taxes paid, the difference amount is deducted later or paid back to
the Branch by the authority.
Bahrain
Banks in Bahrain are not subject to tax according to the regulations of the country.
The Republic of Iraq (Iraq)
The corporate tax rate in Iraq is 15%, and the corporate tax is paid on a consolidated basis to the tax office of the foreign bank's central branch. The
first branch established in Iraq is considered as the central branch. Foreign bank branches whose central branch is within the boundaries of the Central
Government must submit their consolidated financial statements to the relevant tax office by the end of May of the following year, and branches of
foreign banks whose central branch is within the boundaries of the Northern Iraq Regional Government by the end of June of the following year at the
latest and must pay the tax. Northern Iraq Regional Government tax offices can accrue fixed taxes other than the specified rate and can postpone the
last payment period.
Kosovo
Corporate earnings are subject to income tax rate of 10% according to the Kosovo legislation. This ratio is applied to the tax base that will be calculated
as a result of the implementation of exemptions, deductions, addition of disallowable expenses, to the corporate income and that are calculated
in accordance with the tax laws. Tax has to be paid in advance until April, July, October and the 15th day of January of the following year by four
installments. If those prepaid taxes are lower than the final corporate tax, the difference is paid until the end of March of the following year, in case of a
claim made by the company, if it is higher, then the difference is returned to the institution by the tax authorities after the inspection conducted by those
institutions.
4. Transfer Pricing:
Transfer pricing is regulated through Article 13 of Corporate Tax Law titled “Transfer Pricing through Camouflage of Earnings”. Detailed information for the
practice regarding the subject is found in the “General Communiqué Regarding Camouflage of Earnings through Transfer Pricing”.
According to the aforementioned regulations, in the case of making purchase or sales of goods or services with relevant persons/corporations at a price
that is determined against “arm’s length principle”, the gain is considered to be distributed implicitly through transfer pricing and such distribution of
gains is not subject to deductions according to article 11 of Corporate Tax Law in means of corporate tax.
XIX. Borrowings
The Bank, whenever required, generates funds from individuals and institutions residing domestically and abroad by approaching the borrowing
instruments in the form of syndication, securitization, collateralized borrowing and issue of bonds/bills. Such transactions are at first carried at acquisition
cost, and in the following periods they are valued at amortized cost measured by using the effective interest rate method.
XX.
Equity Shares and Their Issuance
Share issuance related to costs is recognized as expenses.
Dividend income related with the equity shares are determined by the General Assembly of the Shareholders.
Weighted average number of shares outstanding is taken into account in the calculation of earnings per share. In case the number of shares increases by
way of bonus issues as a result of the capital increases made by using the internal sources, the calculation of earnings per share is made by adjusting the
weighted average number of shares, which were previously calculated as at the comparable periods. The adjustment means that the number of shares
used in calculation is taken into consideration as if the bonus issue occurred at the beginning of the comparable period. In case such changes in the
number of shares occur after the balance sheet date, but before the ratification of the financial statements to be published, the calculation of earnings
per share are based on the number of new shares. The Bank’s earnings per share calculations taking place in the income statement are as follows:
Profit distributable to shareholders
Weighted average number of share certificates (Thousand figure)
Earnings per share – (in full TL)
61,537,880
250,002,250
0.246149305
Current Period
Prior Period
13,467,895
250,002,250
0.053871095
XXI. Bank Acceptances and Bills of Guarantee
Bill guarantees and acceptances are realized simultaneously with the customer payments, and they are presented as possible liabilities and
commitments in the off-balance sheet accounts.
XXII. Government Incentives
There are no government incentives utilized by the Bank, during the current or prior accounting periods.
XXIII. Segment Reporting
Business segment is the part of an enterprise,
ੵ which conducts business operations where it can gain revenues and make expenditures (including the revenues and expenses related to the
transactions made with the other parts of the enterprise),
ੵ whose operating results are regularly monitored by the authorities with the power to make decisions related to the operations of the enterprise in order
to make decisions related to the funds to be allocated to the segment and to evaluate the performance of the segment, and
ੵ which has its separate financial information.
Information on the Bank’s business segmentation and related information is explained in Section IV, Note XII.
XXIV. Other Disclosures
None.
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Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
SECTION FOUR: INFORMATION ON THE FINANCIAL POSITION AND RISK MANAGEMENT OF THE BANK
I.
Explanations on Shareholders’ Equity
The capital adequacy standard ratio of the bank is 24.36%. (31.12.2021: 20.36%). The capital adequacy standard ratio has been calculated on the
basis of the Regulation on Shareholder’s Equity of Banks, the Regulation on Measurement and Assessment of Capital Adequacy of Bank and other legal
regulations related with BRSA decisions dated 21.12.2021, numbered 9996 and dated 28.04.2022, numbered 10188. Within the scope of the BRSA
decisions, the amount subject to credit risk has been calculated by using the CBRT exchange rates as of 31.12.2021, and the shareholders’ equity has
been calculated without taking into account the negative effects of financial assets in the portfolio of “Financial Assets Through Other Comprehensive
Income” as of 21.12.2021.
COMMON EQUITY TIER I CAPITAL
Paid-in Capital to be Entitled for Compensation after All Creditors
Share Premium
Legal Reserves
Other Comprehensive Income according to TAS
Profit
Net Current Period Profit
Prior Period Profit
Bonus Shares from Associates, Subsidiaries and Joint-Ventures not Accounted in Current Period’s Profit
Common Equity Tier I Capital Before Deductions
Deductions From Common Equity Tier I Capital
Valuation adjustments calculated as per the article 9, (i) of the Regulation on Bank Capital
Prior Period
Current Period
11.615.938
6.115.938
109.156
109.148
57.746.955
45.454.002
68.855.410
23.175.203
61.703.346
18.882.481
61.537.880
13.467.895
165.466
5.414.586
200.030.805
93.736.772
Total Common Equity Tier I Capital
ADDITIONAL TIER I CAPITAL
Preferred Stock not Included in Common Equity Tier I Capital and the Related Share Premiums
Debt Instruments and the Related Issuance Premiums Defined by the BRSA
Debt Instruments and the Related Issuance Premiums Defined by the BRSA (Covered by Temporary Article 4)
Additional Tier I Capital before Deductions
Deductions from Additional Tier I Capital
Direct and Indirect Investments of the Bank on its own Additional Tier I Capital (-)
Investments in Equity Instruments Issued by Banks or Financial Institutions Invested in Bank’s Additional Tier I
Capital and Having Conditions Stated in the Article 7 of the Regulation
Total of Net Long Positions of the Investments in Equity Items of Consolidated Banks and Financial Institutions
where the Bank does not own 10% or less of the Issued Share Capital Exceeding the 10% Threshold of above
Tier I Capital
The Total of Net Long Position of the Direct or Indirect Investments in Additional Tier I Capital of Consolidated
Banks and Financial Institutions where the Bank owns more than 10% of the Issued Share Capital
Other items to be Defined by the regulator
Items to be Deducted from Tier I Capital during the Transition Period
Goodwill and Other Intangible Assets and Related Deferred Taxes not deducted from Tier I Capital as per the
Temporary Article 2, Clause 1 of the Regulation on Measurement and Evaluation of Capital Adequacy of Banks (-)
Net Deferred Tax Asset/Liability not deducted from Tier 1 Capital as per the Temporary Article 2, Clause 1 of the
Regulation on Measurement and Evaluation of Capital Adequacy of Banks (-)
Prior Period
Current Period
192.857.543
90.161.889
Current and prior periods' losses not covered by reserves, and losses accounted under equity according to TAS
3.343.330
1.434.150
Deduction from Additional Tier I Capital when there is not enough Tier II Capital (-)
Leasehold improvements on operational leases
Goodwill Netted with Deferred Tax Liabilities
97.709
48.823
Total Deductions from Additional Tier I Capital
Total Additional Tier I Capital
Other Intangible Assets Netted with Deferred Tax Liabilities Except Mortgage Servicing Rights
3.201.916
1.561.603
Total Tier I Capital (Tier I Capital= Common Equity Tier I Capital + Additional Tier I Capital)
192.857.543
90.161.889
Remaining after deducting from the related deferred tax liability with the deferred tax asset based on future
taxable income, except for deferred tax assets based on temporary differences
Differences arise when assets and liabilities not held at fair value, are subjected to cash flow hedge accounting
Total credit losses that exceed total expected loss calculated according to the Regulation on Calculation of
Credit Risk by Internal Ratings Based Approach
Securitization gains
Unrealized gains and losses from changes in bank’s liabilities’ fair values due to changes in creditworthiness
Net amount of defined benefit plans
Direct and Indirect Investments of the Bank on its own Tier 1 Capital
Shares Obtained against Article 56, Paragraph 4 of the Banking Law
Total of Net Long Positions of the Investments in Equity Items of Unconsolidated Banks and Financial
Institutions where the Bank Owns 10% or less of the Issued Share Capital Exceeding the 10% Threshold of
above Tier I Capital
Total of Net Long Positions of the Investments in Equity Items of Unconsolidated Banks and Financial
Institutions where the Bank Owns 10% or more of the Issued Share Capital Exceeding the 10% Threshold of
above Tier I Capital
Mortgage servicing rights (amount above 10% threshold)
Net Deferred Tax Assets arising from Temporary Differences Exceeding the Threshold of Tier I Capital
Amount Exceeding the 15% Threshold of Tier 1 Capital as per the Article 2, Clause 2 of the Regulation on
Measurement and Evaluation of Capital Adequacy of Banks
The Portion of Net Long Position of the Investments in Equity Items of Consolidated Banks and Financial
Institutions where the Bank owns 10% or more of the Issued Share Capital not deducted from Tier 1 Capital
Excess Amount arising from Mortgage servicing rights
Excess Amount arising from Deferred Tax Assets from Temporary Differences
Other items to be defined by the regulator
530.307
530.307
Deductions from Tier I Capital in cases where there are no adequate Additional Tier I or Tier II Capitals
Total Deductions from Common Equity Tier I Capital
7.173.262
3.574.883
TIER II CAPITAL
Debt Instruments and the Related Issuance Premiums Defined by the BRSA
25.342.500
18.606.250
Debt Instruments and the Related Issuance Premiums Defined by the BRSA (Covered by Temporary Article 4)
1.046.800
Provisions (Amounts explained in the first paragraph of the article 8 of the Regulation on Bank Capital)
10.893.301
6.512.019
Tier II Capital Before Total Deductions
Deductions from Tier II Capital
36.235.801
26.165.069
Direct and Indirect Investments of the Bank on its own Tier II Capital (-)
Investments in Equity Instruments Issued by Banks and Financial Institutions Invested in Bank’s Tier II Capital
and Having Conditions Stated in the Article 8 of the Regulation
The Total of Net Long Position of the Investments in Equity Items of Unconsolidated Banks and Financial
Institutions where the Bank Owns 10% or less of the Issued Share Capital Exceeding the 10% Threshold of Tier
I Capital (-)
The Total of Net Long Position of the Investments in Equity Items of Unconsolidated Banks and Financial
Institutions where the Bank Owns 10% or more of the Issued Share Capital Exceeding the 10% Threshold of Tier
I Capital (-)
Other items to be Defined by the regulator (-)
Total Deductions from Tier II Capital
Total Tier II Capital
Total Equity (Total Tier I and Tier II Capital)
Deductions from Total Equity (Tier I Capital and Tier II Capital)
Loans Granted against the Articles 50 and 51 of the Banking Law
Net Book Values of Movables and Immovable’s Exceeding the Limit Defined in the Article 57, Clause 1 of the
Banking Law and the Assets Acquired against Overdue Receivables and Held for Sale but Retained more than
Five Years
Other items to be Defined by the regulator
Items to be Deducted from the Sum of Tier I and Tier II Capital (Capital) During the Transition Period
36.235.801
26.165.069
229.093.344
116.326.958
2.650
2.650
1.274
1.194
80
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Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Prior Period
Current Period
Information on Subordinated Liabilities:
The Portion of Total of Net Long Positions of the Investments in Equity Items of Consolidated Banks and
Financial Institutions where the Bank does not own 10% or less of the Issued Share Capital Exceeding the 10%
Threshold of above Tier I Capital not deducted from Tier I Capital, Additional Core Capital or Tier II Capital as per
the Temporary Article 2, Clause 1 of the Regulation
The Portion of Total of Net Long Positions of the Investments in Equity Items of Consolidated Banks and
Financial Institutions where the Bank owns more than 10% of the Issued Share Capital Exceeding the 10%
Threshold of above Tier I Capital not deducted from Additional Tier I Capital or Tier II Capital as per the
Temporary Article 2, Clause 1 of the Regulation
The Portion of Long Positions of the Investments in Equity Items of Unconsolidated Banks and Financial
Institutions where the Bank owns 10% of the Issued Share Capital, Deferred tax assets based on temporary
differences and the right to offer mortgage as per the Temporary Article 2, Clause 1, Sub Clause 1 and 2 of the
Regulation
CAPITAL
Total Capital (Total of Tier I Capital and Tier II Capital)
Total Risk Weighted Assets
CAPITAL ADEQUACY RATIOS
Common Equity Tier I Capital Ratio (%)
Tier I Capital Ratio (%)
Capital Adequacy Ratio (%)
BUFFERS
Total Additional Common Equity Requirement Ratio (a+b+c)
a) Capital Conservation Buffer Ratio (%)
b) Bank-specific Counter-Cyclical Capital Buffer Ratio (%)
c) Systematic Important Bank Buffer Ratio (%)
Additional Common Equity Tier I Capital Over Total Risk Weighted Assets Ratio Calculated According to the
Article 4 of Capital Conservation and Counter-Cyclical Capital Buffers Regulation (%)
Amounts Lower Than Excesses as per Deduction Rules
Remaining Total of Net Long Positions of the Investments in Equity Items of Unconsolidated Banks and Financial
Institutions where the Bank Owns 10% or less of the Issued Share Capital
229.090.694
116.325.684
940.288.051
571.357.082
20,51
20,51
24,36
2,56
2,50
0,06
0
14,51
15,78
15,78
20,36
2,56
2,50
0,06
0
9,78
Remaining Total of Net Long Positions of the Investments in Tier I Capital of Unconsolidated Banks and Financial
Institutions where the Bank Owns more than 10% or less of the Issued Share Capital
385.225
280.196
Remaining Mortgage Servicing Rights
Net Deferred Tax Assets arising from Temporary Differences
Limits for Provisions Used in Tier II Capital Calculation
2.557.610
General Loan Provisions for Exposures in Standard Approach (before limit of one hundred and twenty five per
ten thousand)
16.381.640
15.233.222
General Loan Provisions for Exposures in Standard Approach Limited by 1,25% of Risk Weighted Assets
10.893.301
6.512.019
Subsequent call dates, if applicable
None.
Total Loan Provision that Exceeds Total Expected Loss Calculated According to the Communiqué on Calculation
of Credit Risk by Internal Ratings Based Approach
Total Loan Provision that Exceeds Total Expected Loss Calculated According to the Communiqué on Calculation
of Credit Risk by Internal Ratings Based Approach, Limited by 0,6% Risk Weighted Assets
Debt Instruments Covered by Temporary Article 4 (effective between 1 January 2018-1 January 2022)
Upper Limit for Additional Tier I Capital Items subject to Temporary Article 4
Amount of Additional Tier I Capital Items Subject to Temporary Article 4 that Exceeds Upper Limit
Upper Limit for Additional Tier II Capital Items subject to Temporary Article 4
Amount of Additional Tier II Capital Items Subject to Temporary Article 4 that Exceeds Upper Limit
1.046.800
17.272.200
Coupons / dividends
Fixed or floating dividend/coupon
Coupon rate and any related index
Existence of a dividend stopper
Fully discretionary, partially discretionary or
mandatory
Existence of step up or other incentive to
redeem
Fixed
7.85 %
None.
None.
None.
Issuer
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Unique identifier (CUSIP, ISIN etc.)
US900151AF84 -
XS1003016018
US90016BAF58 –
XS1623796072
XS2106022754
Governing law(s) of the instrument
It is subject to English Law
except for certain articles that
will be subject to Turkish Law.
Issued within the scope of
BRSA Regulation on Banks’
Equity.
It is subject to English Law
except for certain articles that
will be subject to Turkish Law.
Issued within the scope of
BRSA Regulation on Banks’
Equity.
It is subject to English Law
except for certain articles that
will be subject to Turkish Law.
Issued within the scope of
BRSA Regulation on Banks’
Equity.
Subject to 10% deduction as of 1/1/2015
No
No
No
Eligible at unconsolidated/consolidated
Unconsolidated -Consolidated Unconsolidated -Consolidated Unconsolidated -Consolidated
Instrument type
Amount recognized in regulatory capital
(Currency in million, as of most recent
reporting date)
Par value of instrument
Accounting classification
Original date of issuance
Perpetual or dated
Original maturity date
10.12.2013
Dated
10 Years
Bond
7,460
Bond
9,325
9,325
Bond
13,988
13,988
Subordinated Liabilities
Subordinated Liabilities
Subordinated Liabilities
Issuer call subject to prior supervisory (BRSA)
approval
Yes
Optional call date, contingent call dates and
redemption amount
The Bank: (1) provided that
subject to having obtained the
prior approval of the related
legislation, can purchase or
otherwise acquire treasury
stock (2) provided that subject
to having obtained the prior
approval of the BRSA, (a) can
redeem all bonds if any taxes
imposed or levied (b) can
redeem all bonds in case of the
deduction from equity.
29.06.2017
22.01.2020
Dated
11 Years
Yes
Dated
10 Years
Yes
The Bank has the option to
repay all of the related bonds
on June 29, 2023 provided
that subject to having obtained
the prior approval of the BRSA.
The Bank: (1) provided that
subject to having obtained the
prior approval of the related
legislation, can purchase or
otherwise acquire treasury
stock (2) provided that subject
to having obtained the prior
approval of the BRSA, (a) can
redeem all bonds if any taxes
imposed or levied (b) can
redeem all bonds in case of the
deduction from equity.
The Bank has the option to
repay all of the related bonds
on January 22, 2025 provided
that subject to having obtained
the prior approval of the BRSA.
The Bank: (1) provided that
subject to having obtained the
prior approval of the related
legislation, can purchase or
otherwise acquire treasury
stock (2) provided that subject
to having obtained the prior
approval of the BRSA, (a) can
redeem all bonds if any taxes
imposed or levied (b) can
redeem all bonds in case of the
deduction from equity.
None.
Fixed
7 %
None.
None.
None.
None.
Fixed
7.75 %
None.
None.
None.
Noncumulative or cumulative
Noncumulative
Noncumulative
Noncumulative
Convertible or non-convertible
None.
None.
None.
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Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
If convertible, conversion trigger (s)
If convertible, fully or partially
If convertible, conversion rate
If convertible, mandatory or optional
conversion
If convertible, specify instrument type
convertible into
If convertible, specify issuer of instrument it
converts into
Write-down feature
If write-down, write-down trigger(s)
In accordance with Regulations
on Equities of Banks.Article
8.2.ğ. bonds have deleted
option from records.
In accordance with Regulations
on Equities of Banks.Article
8.2.ğ bonds have deleted
option from records.
In accordance with Regulations
on Equities of Banks.Article
8.2.ğ. bonds have deleted
option from records.
Due to the losses incurred,
where the Bank is at the
point at which the BRSA may
determine pursuant to Article
71 of the Banking Law that:
(i) its operating license is to
be revoked and the Bank is
liquidated or (ii) the rights
of all of its shareholders
(except to dividends),
and the management and
supervision of the Bank, are
to be transferred to the SDIF
on the condition that losses
are deducted from the capital
of existing shareholders
(occurrence of either condition
means the issuer has become
non-viable).
Due to the losses incurred,
where the Bank is at the
point at which the BRSA may
determine pursuant to Article
71 of the Banking Law that:
(i) its operating license is to
be revoked and the Bank is
liquidated or (ii) the rights
of all of its shareholders
(except to dividends),
and the management and
supervision of the Bank, are
to be transferred to the SDIF
on the condition that losses
are deducted from the capital
of existing shareholders
(occurrence of either condition
means the issuer has become
non-viable)
Due to the losses incurred,
where the Bank is at the
point at which the BRSA may
determine pursuant to Article
71 of the Banking Law that:
(i) its operating license is to
be revoked and the Bank is
liquidated or (ii) the rights
of all of its shareholders
(except to dividends),
and the management and
supervision of the Bank, are
to be transferred to the SDIF
on the condition that losses
are deducted from the capital
of existing shareholders
(occurrence of either condition
means the issuer has become
non-viable)
If write-down, full or partial
Partially or completely
Partially or completely
Partially or completely
If write-down, permanent or temporary
Permanent
Permanent
Permanent
If temporary write-down, description of write-
up mechanism
Position in subordination hierarchy in
liquidation (specify instrument type
immediately senior to instrument)
Paid before shares and the
primary of subordinated debt
and after all the other debts.
Paid before shares and the
primary of subordinated debt
and after all the other debts.
Paid before shares and the
primary of subordinated debt
and after all the other debts.
Incompliance with article number 7 and 8 of
“Own fund regulation”
Yes
Yes
Yes
Details of incompliances with article number 7
and 8 of “Own fund regulation”
To vest conditions stated in
clause of the Article 8 and
don’t vest the conditions stated
in clause of the Article 7.
To vest conditions stated in
clause of the Article 8 and
don’t vest the conditions stated
in clause of the Article 7.
To vest conditions stated in
clause of the Article 8 and
don’t vest the conditions stated
in clause of the Article 7.
Issuer
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Unique identifier (CUSIP, ISIN etc.)
TRSTISB72712
TRSTISB62911
TRSTISB92918
Governing law(s) of the instrument
Is subject to Turkish Law. Has
been issued in accordance
with the BRSA Communiqué
regarding the Equity of Banks.
Is subject to Turkish Law. Has
been issued in accordance
with the BRSA Communiqué
regarding the Equity of Banks.
Is subject to Turkish Law. Has
been issued in accordance
with the BRSA Communiqué
regarding the Equity of Banks.
Taking into account in equity calculation
Subject to 10% deduction as of 1/1/2015
No
No.
Unconsolidated –
Consolidated
Unconsolidated - Consolidated
Eligible at unconsolidated / consolidated
Instrument type (types to be specified by
each jurisdiction)
Amount recognized in regulatory capital
(Currency ın TL million, as of most recent
reporting data)
Bond
880
Nominal value of instrument (TL Million)
1,100
Bond
800
800
No
Unconsolidated –
Consolidated
Bond
350
350
Accounting classification
Original date of issuance
Perpetual or dated
Original maturity date
Issuer call subject to prior supervisory
approval
Subordinated Liabilities
Subordinated Liabilities
Subordinated Liabilities
08.08.2017
19.06.2019
26.09.2019
Dated
10 Years
Yes
Dated
10 Years
Yes
Dated
10 Years
Yes
Optional call date, contingent call dates and
redemption amount
The Bank; (1) can purchase
bills that subject to having
obtained the prior approval of
the BRSA and the date which
may not be earlier than fifth
anniversary of the Issue Date
(2) (a) can redeem all bonds if
any taxes imposed or levied (b)
can redeem all bonds in case of
the deduction from equity
The Bank; (1) can purchase
bills that subject to having
obtained the prior approval of
the BRSA and the date which
may not be earlier than fifth
anniversary of the Issue Date
(2) (a) can redeem all bonds if
any taxes imposed or levied (b)
can redeem all bonds in case of
the deduction from equity
The Bank; (1) can purchase
bills that subject to having
obtained the prior approval of
the BRSA and the date which
may not be earlier than fifth
anniversary of the Issue Date
(2) (a) can redeem all bonds if
any taxes imposed or levied (b)
can redeem all bonds in case of
the deduction from equity
Subsequent call dates, if applicable
None.
Interest/Dividend Payment
Fixed or floating coupon/dividend payments
Floating
None.
Floating
None.
Floating
Coupon rate and any related index
Government Debt Security for
5 years + 350 base points
Turkish Lira Overnight
Reference Interest Rate
(TLREF) + 193 base points
Government Debt Security for
5 years + 350 base points
Existence of a dividend stopper
Fully discretionary, partially discretionary or
mandatory
Existence of step up or other incentive to
redeem
None.
None.
None.
None.
None.
None.
None.
None.
None.
Noncumulative or cumulative
Non-cumulative
Non-cumulative
Non-cumulative
Convertible into equity shares
None.
None.
None.
If convertible, conversion trigger (s)
If convertible, fully or partially
If convertible, conversion rate
If convertible, mandatory or optional
conversion
If convertible, specify instrument type
convertible into
If convertible, specify issuer of instrument it
converts into
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Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Write-down feature
If write-down, write-down trigger(s)
In accordance with Regulations
on Equities of Banks, Article
8 (2) (ğ), bonds have deleted
option from records.
In accordance with Regulations
on Equities of Banks, Article
8 (2) (ğ), bonds have deleted
option from records.
In accordance with Regulations
on Equities of Banks, Article
8 (2) (ğ), bonds have deleted
option from records.
Due to the losses incurred,
within the framework of
Article 71 of the Banking
Law, (1) the Bank’s operating
license is to be revoked and
liquidated or (2) the rights
of all of its shareholders
(except to dividends) and
the management and
supervision of the Bank are
to be transferred to the SDIF
on the condition that losses
are deducted from the capital
of existing shareholders
(occurrence of either condition
means the issuer has become
non-viable) based on the
decision of the BRSA.
Due to the losses incurred,
within the framework of
Article 71 of the Banking
Law, (1) the Bank’s operating
license is to be revoked and
liquidated or (2) the rights
of all of its shareholders
(except to dividends) and
the management and
supervision of the Bank are
to be transferred to the SDIF
on the condition that losses
are deducted from the capital
of existing shareholders
(occurrence of either condition
means the issuer has become
non-viable) based on the
decision of the BRSA.
Due to the losses incurred,
within the framework of
Article 71 of the Banking
Law, (1) the Bank’s operating
license is to be revoked and
liquidated or (2) the rights
of all of its shareholders
(except to dividends) and
the management and
supervision of the Bank are
to be transferred to the SDIF
on the condition that losses
are deducted from the capital
of existing shareholders
(occurrence of either condition
means the issuer has become
non-viable) based on the
decision of the BRSA.
If bond can be written-down, full or partially
Partially or Completely
Partially or Completely
Partially or Completely
If bond can be written-down, permanent,
or temporary
If temporary write-down, description of
write-up mechanism
Permanent
Permanent
Permanent
Position in subordination hierarchy in case
of liquidation (instrument type immediately
senior to the instrument)
Paid before shares and the
primary of subordinated debt
and after all the other debts.
Paid before shares and the
primary of subordinated debt
and after all the other debts.
Paid before shares and the
primary of subordinated debt
and after all the other debts.
Incompliance with article number 7 and 8 of
Regulation on Bank Capital
Yes.
Yes.
Yes.
Details of incompliances with article number 7
and 8 of Regulation on Bank Capital
To vest conditions stated in
clause of the Article 8 and
don’t vest the conditions stated
in clause of the Article 7.
To vest conditions stated in
clause of the Article 8 and
don’t vest the conditions stated
in clause of the Article 7.
To vest conditions stated in
clause of the Article 8 and
don’t vest the conditions stated
in clause of the Article 7.
Explanations on the reconciliation of amounts on the equity items statement and amounts on the balance sheet:
Current Period
Calculation (*)
Shareholders’ equity
Leasehold improvements on operational leases
Goodwill and intangible assets
Provision
Subordinated debt
Deductions from shareholders’ equity
Capital
Carrying Amount
Amounts in Equity
191.376.075
191,376,075
97,709
3,514,433
16,381,640
33,558,745
2,650
196.157.168
196,157,168
(97,709)
(3,201,916)
10,893,301
25,342,500
(2,650)
229,090,694
(*) The related amounts are calculated in accordance with “Regulation on Equities of Banks”. In this context, part of the expected credit loss of stage 1 and stage 2 up to 1.25 % of
amount subject to credit risk, part; subordinated loans according of the regulation, have been taken into consideration in equity calculation. On the other hand, in the calculation,
the amount of equity calculated in accordance with the regulation dated 21.12.2021 and numbered 9996 of the BRSA and the amount based on the credit risk calculated in
accordance with the regulation were used dated 28.04.2022 and numbered 10188.
II.
Explanations on Credit Risk
1. Credit risk is defined as the possibility of incurring loss where the counterparty in a transaction, partially or completely fails to meet its contractual
obligations in due time in an agreement with the Bank.
The Bank’s position against the credit risk limits defined by the current legislation is monitored by the Board. Within this framework, loans extended to
Risk Groups and the Bank’s Risk Group, including the Bank; loans in high amounts and limitations regarding the shares in participations are monitored
according to the limits determined in connection with the size of the shareholders’ equity.
Credit risk limits of customers are determined depending on the financial situation and loan requirements of the borrowers, in strict compliance with the
relevant banking legislation, within the framework of loan authorization limits of Branches, Regional Offices, Loan Divisions, the Deputy Chief Executives
responsible for loans, the CEO, the Credit Committee and Board of Directors. These limits may be changed as may be deemed necessary by the
Bank. Moreover, all commercial credit limits are revised periodically, provided that each period does not exceed a year. Furthermore, the borrowers and
borrower groups forming a large proportion of the overall placement are subject to risk limits in order to provide further minimization of potential risk.
The geographical distribution of borrowers is consistent with the concentration of industrial and commercial activities in Turkey.
The distribution of borrowers by sector is monitored closely for each period and sectoral risk limits have been determined to prevent concentration of risk
in sectoral sense.
The credit-worthiness of customers is monitored on a consistent basis by using company rating and scoring models specially developed for this
purpose, and the audit of statements of account received is assured to have been made in accordance with the provisions as stipulated by the relevant
legislation.
Utmost importance is given to ensure that loans are furnished with collaterals. Allocation decision, by the definition of credit risk, is not based on the
assumption of collaterals can be liquidized. Most of the loans extended are collateralized by taking real estate, movable or commercial enterprise under
pledge, promissory notes and other liquid assets as collateral, or by acceptance of bank letters of guarantee and individual or corporate guarantees.
Jurisdictional applicability of collaterals in default, time required to convert to money and ability to maintain expected values are taken into consideration
from the beginning of the credit allocation process. Most of the loans are collateralized by the receipt of real estate and securities pledge, commercial
enterprise pledge, exchange notes and other liquid securities receivables, bank letters of guarantees and surety of other persons and institutions. It is an
important element of the credit policy that disinclude concentration on collaterals.
Non-performing and impaired loans has been classified in accordance with the “TFRS 9-Financial Instruments” and BRSA’s “Regulation on Procedures
and Principles for Classification of Loans and Provisions to be set aside”. The detailed descriptions of these methods correspond with accounting
practices, are included in Section Three Note VIII.
Credit risk is the risk reduction effects without taking into consideration the total amount of exposures after offsetting transactions with different risk
classes according to the types and amounts of disaggregated risks are listed below the average for the period.
Amount subject to credit risk (*)
Risk Classifications
Exposures to central governments or central banks
Exposures to regional governments or local authorities
Exposures to administrative bodies and non-commercial undertakings
Exposures to multilateral development banks
Exposures to international organizations
Exposures to banks and brokerage houses
Corporates exposures
Retail exposures
Exposures secured by residential real estate property
Exposures secured by commercial real estate property
Past due items
Items in regulatory high-risk categories
Exposures in the form of bonds by mortgages
Short term exposures to banks, brokerage houses and corporates
Exposures in the form of collective investment undertakings
Other items
Share Certificate Investment
(*) Risk amounts after the credit conversions and the effects of credit risk mitigation
(**) Average risk amounts are the arithmetical average of the amounts in quarterly reports prepared.
Current Period Risk
Amount
Average Risk Amount
(**)
412,015,045
361,971,573
192,167
162,638
738,079
42,605,601
439,505,721
186,833,240
34,914,774
32,744,712
5,925,237
92,007,097
2,646,881
61,766,665
78,246,112
253,333
200,691
539,782
46,747,325
407,329,369
149,622,525
29,390,397
30,784,430
6,069,248
61,269,907
2,128,314
42,054,606
56,376,943
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İşbank 2022 Integrated Annual Report 229
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Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
2. There are certain control limits on forward transactions in terms of counter parties, and the risks taken for derivative instruments are evaluated along
with other potential risks resulting from the market fluctuations.
3. As a result of the current level of customers’ needs and the progress in the domestic market in this particular area, the Bank uses derivative
transactions either for hedging or for commercial purposes. Derivative instruments with a remarkable volume are monitored with consideration that they
can always be liquidated in case of need.
4.Indemnified non-cash loans are considered as having the same risk weights as unpaid cash loans.
The rating and scoring systems applied by the Bank, includes detailed company analysis and enables rating of all companies and loans without any
restrictions regarding credibility. Loans and companies, which have been renewed, restructured or rescheduled, are rated within the scope of this system.
Specialized loans are evaluated by a special rating system, which is based on the credibility of the counterparty as well as the feasibility and risk analysis
of the cash flows created mainly by the projects undertaken or the asset financed.
5. Lending transactions abroad are conducted by determining the country risks of related countries within the context of the current rating system and
by taking the market conditions, country risks, and the relevant legal limitations into account. Furthermore, the credibility of banks and other financial
institutions established abroad is examined within the framework of the ratings that are determined by rating agencies and backed with CDS-IR (based
on credit default swap) ratings and credit limits are assigned to the related banks and financial institutions accordingly.
6.
i. (i)
The share of the Bank’s receivables from the top 100 and 200 cash loan customers in the overall cash loan portfolio stands at 28%, 36%,
respectively (December 31, 2021: 31%, 39%).
ii. (ii)
The share of the Bank’s receivables from the top 100 and 200 non-cash loan customers in the overall non-cash portfolio stands at 42%,
54% respectively (December 31, 2021: 44%, 57%).
iii. (iii)
The share of the Bank’s cash and non-cash receivables from the top 100 and 200 loan customers in the overall cash and non-cash loans
stands at 19%, 25%, respectively (December 31, 2021: 18%, 24%).
Companies that are among the top loan customers ranked according to cash, non-cash and total risks are leaders in their own sectors, the loans
advanced to them are in line with their volume of industrial and commercial activity. A significant part of such loans is extended on a project basis, with
their repayment sources being analyzed in accordance with the banking principles to be considered as satisfactory and associated risks are determined
and duly covered by obtaining appropriate guarantees when deemed necessary.
7. The total value of the stage 1 and stage 2 expected credit loss allocated for credit risk stands at TL 15,381,907 (December 31, 2021: TL 14,511,914).
8. The Bank measures the quality of its loan portfolio by applying different rating/scoring models on cash commercial/corporate loans, retail loans and
credit cards. The breakdown of the rating/scoring results, which are classified as “Strong”, “Standard” and “Below Standard” by considering their default
features, is shown below.
The loans whose borrowers’ capacity to fulfill their obligations is very good, are defined as “Strong”, whose borrowers’ capacity to fulfill its obligations in
due time is reasonable, are defined as “Standard” and whose borrowers’ capacity to fulfill their obligations is poor, are defined as “Below Standard”.
Strong
Standard
Below Standard
The table data comprises behavior rating/scoring results.
Current Period
Prior Period
50.00%
44.71%
5.29%
45.06%
49.68%
5.26%
9. The net values of the collaterals of the closely monitored loans are given below in terms of collateral types and risk matches.
Type of Collateral
Personal
Commercial
and Corporate
Credit
Cards
Personal
Commercial
and Corporate
Credit
Cards
Current Period
Prior Period
Real Estate Mortgage (*)
1,227,513
8,211,635
1,085,464
8,038,098
Cash Collateral (Cash, securities
pledge, etc.)
47,812
478,666
48,643
248,190
10. The net values of the collaterals of non-performing loans are given below in terms of collateral types and risk matches.
Type of Collateral
Current Period
Prior Period
Net Value of the Collateral
Loan Balance Net Value of the Collateral
Loan Balance
Real Estate Mortgage (*)
5,485,809
5,485,809
5,444,533
5,444,533
Cash Collateral
Vehicle Pledge
Other (Suretyship, commercial enterprise
under pledge, commercial papers, etc.)
1,854
253,411
1,854
253,411
657
263,607
657
263,607
8,010,972
8,010,972
6,716,113
6,716,113
(*) The mortgage and/or pledge amounts on which third parties have priorities are deducted from the fair values of collaterals in expertise reports, and after comparing the results to
the mortgage/pledge amounts and loan balances the smallest figures are considered to be the net value of collaterals.
11. The aging analysis of the receivables past due but not impaired in terms of financial asset classes, is as follows:
Current Period (*)
Loans
Corporate / Commercial Loans
Consumer Loans
Credit Cards
Total
31-60 Days (**)
61-90 Days (**) (***)
Total
173,399
229,331
452,940
855,670
184,153
128,202
184,076
496,431
357,552
357,533
637,016
1,352,101
(*) The loans classified as closely monitored that are not past due or past due for less than 31 days is TL 66,101,064.
(**) Related figures show only overdue amounts of installment based commercial loans and installment-based consumer loans; the principal amounts of the loans which are not
due as of the balance sheet date are equal to TL 854,981 and TL 1,646,781 respectively.
Prior Period (*)
Loans
Corporate / Commercial Loans
Consumer Loans
Credit Cards
Total
31-60 Days (**)
61-90 Days (**)
Total
79,196
155,537
393,119
627,852
689,714
70,167
204,307
964,188
768,910
225,704
597,426
1,592,040
(*) The loans classified as closely monitored that are not past due or past due for less than 31 days is TL 55,682,522.
(**) Related figures show only overdue amounts of installment based commercial loans and installment-based consumer loans; the principal amounts of the loans which are not
due as of the balance sheet date are equal to TL 1,185,836 and TL 1,196,104 respectively.
Pledge on Wages and Vehicles
3,092,378
Cheques & Notes
Other (Suretyship, commercial
enterprise under pledge, commercial
papers, etc.)
369,527
1,907
2,344,742
331,996
499
456,308
33,996,002
450,396
33,902,536
Non-collateralized
7,029,998
11,101,472
3,941,709
3,411,382
7,588,212 2,206,344
Total
11,854,009
54,159,209
3,941,709
7,340,627
50,109,531 2,206,344
(*) The mortgage and/or pledge amounts on which third parties have priorities are deducted from the fair values of collaterals in expertise reports; and after comparing the results
to the mortgage/pledge amounts and loan balances, the smallest figures are considered to be the net value of collaterals.
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230 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 231
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Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
12. Profile of significant exposures in major regions
Current Period
Domestic
European
Union
OECD
Countries
(**)
Off-Shore
Banking
Regions
USA,
Canada
Other
Countries
Investments
in Associates,
Subsidiaries
and Jointly
Controlled
Entities
Undistributed
Assets/
Liabilities (***)
Total
Prior Period
Domestic
European
Union
OECD
Countries
(**)
Off-Shore
Banking
Regions
USA,
Canada
Other
Countries
Investments
in Associates,
Subsidiaries
and Jointly
Controlled
Entities
Undistributed
Assets/
Liabilities (***)
Total
Risk Sınıfları (*)
Contingent and Non-Contingent
Receivables from Central
Governments or Central Banks
Contingent and Non-Contingent
Receivables from Regional
Government or Domestic
Government
Contingent and Non-Contingent
Receivables from Administrative
Units and Non-Commercial
Enterprises
Contingent and Non-Contingent
Receivables from Multilateral
Development Banks
Contingent and Non-Contingent
Receivables from International
Organizations
Contingent and Non-Contingent
Receivables from Banks and
Intermediaries
Contingent and Non-Contingent
Corporate Receivables
Contingent and Non-Contingent
Retail Receivables
Contingent and Non-Contingent
Receivables Secured by
Residential Property
402,885,482
10
1,136,971
7,992,582
412,015,045
192,141
162,503
657,915
80,164
26
135
192,167
162,638
738,079
11,041,637
17,319,637
9,787,728
5,715
1,795,520
2,655,364
42,605,601
423,592,178
1,501,506
3,307,863
1,801,982
7,132
9,295,060
184,286,264
419,021
219,733
2,824
73,339
1,832,059
66,393,260
246,958
58,801
3,294
65,415
891,758
Non-Performing Receivables
5,836,531
75,939
4,709
1
1,917
6,140
90,985,138
164,594
34,256
437
18,387
804,285
Receivables are identified as high
risk by the Board
Secured Marketable Securities
Short-term Receivables and Short-
term Corporate Receivables from
Banks and Intermediaries
Investments as Collective
Investment Institutions
2,646,881
Other Receivables
61,610,586
93,188
62,891
Share Certificate Investments
78,246,112
439,505,721
186,833,240
67,659,486
5,925,237
92,007,097
2,646,881
61,766,665
78,246,112
260,247,872
393
1,136,972
3,328,635
264,713,872
Risk Groups (*)
Contingent and Non-Contingent
Receivables from Central
Governments or Central Banks
Contingent and Non-Contingent
Receivables from Regional
Government or Domestic
Government
Contingent and Non-Contingent
Receivables from Administrative
Units and Non-Commercial
Enterprises
Contingent and Non-Contingent
Receivables from Multilateral
Development Banks
Contingent and Non-Contingent
Receivables from International
Organizations
Contingent and Non-Contingent
Receivables from Banks and
Intermediaries
Contingent and Non-Contingent
Corporate Receivables
Contingent and Non-Contingent
Retail Receivables
Contingent and Non-Contingent
Receivables Secured by
Residential Property
342,280
587,534
299,645
28
74
5,913,906
16,832,796
8,512,787
1,405
4,209,839
1,639,272
294,656,816
982,718
2,629,437
652,920
3,369
7,349,672
124,213,264
245,659
143,404
1,545
37,789
1,532,929
51,549,305
212,708
45,683
85
34,547
653,554
Non-Performing Receivables
6,653,184
127,476
4,330
1,349
4,720
Receivables are identified as
high risk by the Board
Secured Marketable Securities
Short-term Receivables
and Short-term Corporate
Receivables from Banks and
Intermediaries
Investments as Collective
Investment Institutions
23,255,664
92,613
12,713
1,377
13,994
267,888
1,586,280
Other Receivables
26,581,561
110,895
455,605
Equity Investments
38,685,526
342,308
587,608
299,645
37,110,005
306,274,932
126,174,590
52,495,882
6,791,059
23,644,249
1,586,280
27,148,061
38,685,526
Total
1,249,632,601 20,478,768 13,556,145
1,814,253
3,098,681
23,477,409
78,246,112
1,390,303,969
Total
795,587,666 18,605,258
12,103,604
657,332
5,437,859 14,776,772
38,685,526
885,854,017
(*) Risk amounts after the credit conversions and the effects of credit risk mitigation
(**) OECD countries other than EU countries, USA and Canada
(***) Assets and liabilities that are not consistently allocated.
(*) The figures represent total risk amounts before credit risk mitigation and after credit conversion factor.
(**) OECD countries other than EU countries, USA and Canada
(***) Assets and liabilities that are not consistently allocated
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Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
13. Risk profile by sectors or counterparties:
Current Period
Bank
Current Period
Bank
(1) (**)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
(10)
(11)
(12)
(13)
(14)
TP
YP
Toplam
Sectors/Counterparty (*)
Agricultural
Farming and Raising Livestock
Forestry
Fishing
Industry
Mining
Production
93,906
74,933
6,232
12,741
548
509
39
4,183,233
8,691,911
2,551,173
8,587,676
47,717
1,584,343
49,604
54,631
1,075,738
996,712
7,850
71,176
31,259
29,950
48
1,261
553,141
525,557
2,794
24,790
12,190,025
2,439,711
14,629,736
11,978,255
788,255
12,766,510
112,758
1,526
114,284
99,012
1,649,930
1,748,942
3,823,813
4,736
684
194,041,164
16,152,449
10,756,512
2,923,022
11,171,508
38,975,666
134,008,658
143,840,896
277,849,554
114,809
3,706,023
7,519,636
344,410
215,983
33,347
596,844
3,510,047
5,314,982
8,825,029
130,801,547
15,457,417
10,274,920
600,420
8,243,242
38,975,666
115,952,180
92,107,055
208,059,235
Electricity, gas, and water
2,981
4,736
Construction
Services
Wholesale and Retail Trade
Hotel, Food and Beverage Services
1,164,101
160,594,874
1,692,011
250,673
684
2,590
55,719,981
350,622
265,609
2,289,255
2,331,422
39,388,147
8,275,169
5,934,700
725,665
2,596,574
14,546,431
46,418,859
60,965,290
29,286,334
28,800,612
58,086,946
151,510
738,079
42,552,620 173,836,986
70,181,182
29,303,613
1,081,112
18,197,550
2,646,881
219,861
38,205,021
238,646,977
299,062,312
537,709,289
66,774,252
41,379,410
15,017,732
393,241
11,821,824
155,804
103,540,526
33,693,748
137,234,274
8,905,512
3,865,158
3,348,572
235,959
622,515
9,420,483
7,807,906
17,228,389
Transportation and Telecommunication
5,883,279
41,245,490
17,131,538
3,325,512
329,027
2,476,054
117,093
31,896,624
38,611,369
70,507,993
Financial Institutions
152,530,460
1
738,079
42,552,620
37,923,673
927,707
6,976,383
2,580,301
979,005
1,653,049
946,468
621,282
10,086,203
2,022,737
1,078,824
4,083,656
511,512
1,098,580
839,225
1,582
69,464
39,514
4,865
7,460
241,386
2,646,881
219,861
30,745,473
68,372,103
201,234,444
269,606,547
1,741,720
407,104
394,012
492,935
7,186,651
16,140,063
6,575,763
22,715,826
3,288,932
454,523
3,743,455
1,613,471
1,487,987
3,101,458
4,374,775
9,196,572
13,571,347
Real Estate and Renting Services
Self-Employment Services
Education Services
Health and Social Services
23,874
59,050
32,985
122,542
Other
Total
53,777
94,221
3,266
245
7,306
246,338,351
187,431
52,981
28,056,191
83,532,529
20,588,923
1,164,179
59,488,324
61,546,804
1,065,425
433,057,380
68,971,064
502,028,444
412,015,045
192,167
162,638
738,079
42,605,601
439,505,721
186,833,240
67,659,486
5,925,237
92,007,097
2,646,881
61,766,665
78,246,112
847,189,374
543,114,595
1,390,303,969
(1) Contingent and non-contingent exposures to central governments or central banks
(9) Contingent and non-contingent exposures secured by real estate property
(2) Contingent and non-contingent exposures to regional governments or local authorities
(10) Past due receivables
(3) Contingent and non-contingent exposures to administrative bodies and non-commercial
undertakings
(4) Contingent and non-contingent exposures to multilateral development banks
(5) Contingent and non-contingent exposures to international organizations
(6) Contingent and non-contingent exposures to banks and brokerage houses
(7) Contingent and non-contingent corporate receivables
(8) Contingent and non-contingent retail receivables
(11) Receivables in regulatory high-risk categories
(12) Other receivables
(13) Share Certificate Investments
(14) Stock Investments
(*) Risk amounts after the credit conversions and the effects of credit risk mitigation
(**) Credit Guarantee Fund guaranteed by the undersecretariat of treasury are included in the
receivables from central governments.
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234 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 235
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
14. Analysis of maturity-bearing exposures according to remaining maturities:
16. Miscellaneous Information According to Type of Counterparty or Major Sectors
Current Period
Time to Maturity
Risk Groups (*)
Receivables from Central Governments or
Central Banks
Receivables from Regional Governments or
Domestic Governments
Receivables from Administrative Units and
Non-Commercial Enterprises
The multilateral development banks and
non-contingent receivables
1 Month
1-3 Months
3-6 Months
6-12 Months
Over 1 Year
Total
15,757,516
5,281,883
7,177,077
13,251,675
177,195,527
218,663,678
1,518
4,127
28,719
16,047
141,753
192,164
2,872
3,365
10,841
1,833
93,183
112,094
555,476
13,487
167,096
736,059
Receivables from Banks and Intermediaries
20,468,704
3,673,418
4,382,787
3,177,195
2,876,087
34,578,191
Corporate Receivables
43,534,046
57,435,915
68,813,888
63,885,288
196,678,855
430,347,992
Retail Receivables
80,768,322
3,408,661
7,173,149
26,032,601
57,306,749
174,689,482
Collateralized Receivables with Real Estate
Mortgages
Receivables are identified as High Risk by
the Board
6,802,085
2,253,297
3,758,046
8,240,241
41,873,182
62,926,851
5,282,625
6,772,289
10,765,843
13,746,024
55,316,322
91,883,103
Total
173,173,164
78,846,442
102,110,350
128,518,000
531,481,658
1,014,129,614
(*) The figures represent total risk amounts before credit risk mitigation and after credit conversion factor.
15. Information on Risk Classes
In the calculation of the amount subject to credit risk, determining the risk weights related to risk classes stated on the article of “Regulation on
Measurement and Evaluation of Capital Adequacy of Banks”, is based on the Fitch Ratings’ and JCR Avrasya Derecelendirme A.Ş. international rating.
“Receivables from Banks and Intermediaries” are receivables from related parties residing in foreign countries against the risk evaluated in class with
“Receivables from Central Governments or Central Banks” are receivables that are evaluated in the class will be the subject of risk weights determined
in accordance with Fitch Ratings issued by the rating of the risk. “Contingent and Non-Contingent Receivables from Banks and Intermediaries” in the
class with resident banks and brokerage firms in the dorm evaluated risk “Corporate Receivables” in the class evaluated dorm resident companies and
financial institutions in the TL-denominated receivables, the risk weights that will be the subject of JCR Avrasya Derecelendirme A.Ş. international rating
grades assigned by it are used.
If a receivable-specific rating is performed, risk weights to be applied on the receivable are determined by the relevant credit rating.
The table related to mapping the ratings used in the calculations and credit quality grades, which is stated in the Annex of Regulation on Measurement
and Evaluation of Capital Adequacy of Banks, is given below:
Credit Quality Grades
1
2
3
4
5
6
Risk Rating
AAA via AA-
A+ via A-
BBB+ via BBB-
BB+ via BB-
B+ via B-
CCC+ and lower
Risk Amounts according to Risk Weights
0%
20%
35%
50%
75%
100%
150%
250%
Other
Mitigation in
Shareholders’
Equity (**)
404,361,323 69,118,282 35,026,246 91,410,676 170,313,658 535,379,338 60,312,347 385,225 36,962,227
3,296,197
417,626,191 67,554,463 34,914,774 90,685,838 166,261,050 515,936,220 59,977,981 385,225 36,962,227
3,296,197
Risk
Weight
Amount
Before
Credit Risk
Mitigation
(*)
Amount
After
Credit Risk
Mitigation
(*) The figures represent total risk amounts before credit risk mitigation and after credit conversion factor.
Significant Sectors/Counterparty
Current Period
1
Agricultural
1.1
1.2
1.3
Farming and Raising Livestock
Forestry
Fishing
2
Industry
2.1
2.2
2.3
Mining
Production
Electricity, gas, and water
3 Construction
4
Services
4.1
4.2
4.3
4.4
4.5
4.6
4.7
4.8
Wholesale and Retail Trade
Hotel, Food and Beverage Services
Transportation and
Telecommunication
Financial Institutions
Real Estate and Renting Services
Self-Employment Services
Education Services
Health and Social Services
5 Other
6
Total
Loans
Depreciated (TFRS 9)
Provisions
Significant Increase in Credit
Risk (Stage 2)
Non-Performing (Stage 3)
Expected Credit Loss (TFRS 9)
660.859
537.181
2.447
121.231
24.254.801
18.578
6.780.275
17.455.948
3.516.100
25.510.500
4.242.845
6.183.361
3.905.105
12.950
6.746.091
1.403.131
76.514
2.940.503
16.012.667
69.954.927
114.270
103.241
654
10.375
9.819.108
114.036
2.027.883
7.677.189
3.549.317
5.866.800
1.758.183
641.584
1.386.657
5.309
1.914.212
82.347
33.729
44.779
3.784.635
23.134.130
151.588
127.448
933
23.207
13.132.751
83.350
2.927.043
10.122.358
3.038.616
8.423.293
1.792.112
874.918
1.504.391
5.091
3.314.576
466.230
35.307
430.668
4.166.500
28.912.748
17. Information on Value Adjustments and Change in Credit Provisions:
Beginning Balance Additional Provisions
Reversal of
Provisions
Other Value
Adjustment
Ending Balance
1 Stage 3 provisions
13,790,995
10,976,758
(7,560,641)
2
Stage 1 and Stage 2
Provisions
14,511,914
7,686,291
(6,816,298)
17,207,112
15,381,907
18. Exposures Subject to Counter-cyclical Capital Buffer
Country
RWA Calculations for Private
Sector Loans in Banking Book
RWA calculations for Trading Book
Total
Turkey
TRNC
England
Albania
Cayman Island
Kosovo
Malta
Iraq
United Arab Emirates
Germany
Other
624,751,534
498,961
625,250,495
5,849,080
3,278,076
1,910,228
1,801,937
1,517,770
1,499,950
1,268,420
302,225
220,857
619,885
5,849,080
3,278,076
1,910,228
1,801,937
1,517,770
1,499,950
1,268,420
302,225
220,857
619,885
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236 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 237
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
III.
Explanations on Currency Risk
The exposed currency risk of the Bank is result of the difference between the assets denominated in and indexed to foreign currencies and liabilities
denominated in foreign currencies. Furthermore, parity fluctuations of different foreign currencies are another element of the currency risk.
The currency risk is managed by the internal currency risk limits which are established as a part of the Bank’s risk policies. The Assets and Liabilities
Management Committee and the Assets and Liabilities Management Unit meet regularly to take the necessary decisions for hedging exchange rate and
parity risks within the framework of the limits determined by the “Net Foreign Currency Overall Position/Shareholders’ Equity” Standard Ratio which is a
part of the legal requirement and the internal currency risk limits specified by the Board of Directors. Foreign exchange risk management decisions are
strictly applied.
In measuring currency risk, both the Standard Method and the Value at Risk Model (VAR) and Expected Shortfall are used as applied in the statutory
reporting.
Measurements made within the scope of the Standard Method are carried out on a monthly basis and form the basis of determining the capital
requirement for hedging currency risk.
Risk measurements made within the context of the VAR are practiced on a daily basis using the historical and Monte Carlo simulation methods. Scenario
analyses are conducted to support the calculations made within the VAR context. Expected loss calculations are also carried out daily.
The results of the measurements made on currency risk are reported to the Key Management and the risks are closely monitored by taking into account
the market and the economic conditions.
The Bank’s foreign currency purchase rates at the date of balance sheet and for the last five working days of the period announced by the Bank
in TL are as follows:
Date
USD
EUR
December 31, 2022
December 30, 2022
December 29, 2022
December 28, 2022
December 27, 2022
December 26, 2022
18.6500
18.6500
18.6150
18.6031
18.5821
18.5344
19.9247
19.9247
19.8629
19.7565
19.7900
19.7020
The Bank’s last 30-days arithmetical average foreign currency purchase rates:
USD: 18,5001 TL
EURO: 19,6013 TL
Sensitivity to currency risk:
The Bank’s sensitivity to any potential change in foreign currency rates has been analyzed. In the analysis presented below, 10% change, which is also
the amount used for the internal reporting purposes, is anticipated in USD, EUR, GEL and GBP.
% Change in Foreign Currency
Effects on Profit/Loss (*)
Current Period
Prior Period
10 % increase
10 % decrease
10 % increase
10 % decrease
10 % increase
10 % decrease
10 % increase
10 % decrease
188,682
(188,682)
579,692
(579,692)
82,821
(82,821)
(99,261)
99,261
(31,038)
31,038
284,955
(284,955)
44,033
(44,033)
13,420
(13,420)
USD
EURO
GEL
GBP
(*) Indicates the values before tax
Information on currency risk:
Current Period
Assets
EUR
USD
Other FC
Total
Cash (Cash in Vault, Foreign Currency Cash, Money in Transit, Cheques
Purchased) and Balances with the Central Bank of Turkey (1)
Banks
Financial Assets at Fair Value through Profit/Loss (2)
Money Market Placements
57,908,106
86,448,059
32,874,116
177,230,281
6,109,905
2,683,519
7,062,434
9,746,660
9,211,916
22,384,255
8,756,568
21,186,747
Financial Assets at Fair Value Through Other Comprehensive Income
3,100,317
42,842,959
10,121
45,953,397
Loans (3)
136,109,934
147,243,157
6,038,471
289,391,562
Investments in Associates, Subsidiaries and Jointly Controlled Entities (Joint
Ventures)
7,825,519
2,461,926
10,287,445
Financial Assets Measured at Amortised Cost
1,438,360
4,373,646
2,445,619
8,257,625
Derivative Financial Assets Held for Risk Management
Tangible Assets (2)
Intangible Assets (2)
Other Assets (2)
Total Assets
Liabilities
Banks Deposits
Foreign Currency Deposits (4)
Money Market Funds
27,102
2,794
29,198
59,094
485,985
6,118,513
456,816
7,061,314
215,688,747 303,838,222
62,284,751
581,811,720
2,319,353
3,163,785
962,739
6,445,877
164,553,060
270,889,723
103,054,811
538,497,594
12,090,068
12,090,068
Funds Provided from Other Financial Institutions
22,092,337
45,974,467
21,910
68,088,714
Marketable Securities Issued (5)
Miscellaneous Payables
Derivative Financial Liabilities Held for Risk Management
Other Liabilities (2)
Total Liabilities
Net Balance Sheet Position
Net Off Balance Sheet Position
Derivative Financial Assets (6)
Derivative Financial Liabilities (6)
Non-Cash Loans
Prior Period
Total Assets
Total Liabilities
Net Balance Sheet Position
Net Off Balance Sheet Position
Derivative Financial Assets
Derivative Financial Liabilities
Non-Cash Loans
56,678,084
2,126,368
5,141,862
758,983
253,537
57,437,067
7,521,767
4,118,373
6,770,823
511,140
11,400,336
195,209,491
400,708,812
105,563,120
701,481,423
20,479,256 (96,870,590)
(43,278,369)
(119,669,703)
(14,455,388)
103,074,628
44,564,310
133,183,550
38,972,528
157,036,003
48,930,238
244,938,769
53,427,916
53,961,375
4,365,928
111,755,219
68,430,893
79,258,121
8,944,195
156,633,209
204,810,246
229,504,923
43,119,943
477,435,112
166,286,867
328,298,342
75,470,330
570,055,539
38,523,379 (98,793,419)
(32,350,387)
(92,620,427)
(34,917,922)
102,207,134
33,934,554
101,223,766
23,722,933
151,052,076
37,319,331
212,094,340
58,640,855
48,844,942
3,384,777
110,870,574
63,144,010
75,747,621
8,477,435
147,369,066
(1) Precious metals accounts amounting TL 31,128,501 are included.
(2) In accordance with the Communiqué regarding the principles of the “Regulation on Measurement and Practices of Banks’ Net Overall FC Position/Shareholders’ Equity
Ratio on a Consolidated and Unconsolidated Basis”, Foreign Currency Income Accruals of Derivative Financial Instruments (TL 4,953,311), Operating Lease Development
Costs (TL 5,860), Intangible assets (TL 8.256), Prepaid Expenses (TL 306,367), Stage 1 and Stage 2 expected credit loss (TL (9,754,592)), Assets Held for Sale and Related
to Discontinued Operations (TL 6,055), in liabilities; Foreign Currency Expense Accruals of Derivative Financial Instruments (TL 1,906,925) and Shareholders’ Equity (TL
(4,939,662)) in Stage 1 and Stage 2 expected credit loss for non-cash loans (TL 126,809) in liabilities are not included in currency risk calculations.
(3) Foreign currency indexed loans amounting TL 524,822 presented in TL loans in the balance sheet are included in the table above. TL 384,739 is USD indexed, TL 134,916 is
EUR indexed, TL 401 is CHF indexed, TL 4,766 is GBP indexed.
(4) Precious metals deposit accounts amounting TL 74,492,798 are included.
(5) Includes Tier 2 subordinated bonds which are classified on the balance sheet as subordinated loans.
(6) The derivative transactions within the context of forward foreign currency options and foreign currency forwards definitions included in the Communiqué above are taken into
consideration.
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238 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 239
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
IV.
Explanations on Interest Rate Risk
a. Interest rate sensitivity of assets, liabilities and off-balance sheet items (Based on time remaining to repricing date):
Interest rate risk is defined as the impairment in the value of the Bank’s interest sensitive Asset, liabilities and off-balance sheet items due to interest rate
fluctuations. A method which takes into consideration the effect of standard interest shocks on the economic values of the Bank’s on, and off-balance
sheet interest sensitive accounts is used for measuring the interest rate risk arising from the banking accounts, whereas the interest rate risk related to
interest sensitive financial instruments followed under trading accounts is assessed within the scope of market risk.
Potential effects of interest rate risk on the Bank’s assets and liabilities, market developments, the general economic environment and expectations are
regularly followed in meetings of the Asset-Liability Management Committee, where further measures to reduce risk are taken when necessary.
The Bank’s on and off-balance sheet interest sensitive accounts other than the assets and liabilities exposed to market risk are monitored and
controlled by the limits on the ratio of structural interest rate risk to equity and tier 1 capital determined by the Board within the scope of “Asset-Liability
Management Risk Policy”. Moreover, scenario analyses formed in line with the average maturity gaps and the historical data and expectations are also
used in the management of the related risk.
In addition, the impact of changes in interest rates on the Bank’s net interest income is regularly analyzed. Within this framework, the limit on the ratio of
change in net interest income to the capital is expected to occur under various scenarios are monitored and regularly reported to senior management.
Interest rate sensitivity
In this part, the sensitivity of the Bank’s assets and liabilities to the interest rates has been analyzed assuming that the year-end balance figures were the
same throughout the year. Mentioned analysis shows how the FC and TL changes in interest rates by one point during the one-year period affect the
Bank's income accounts and shareholders' equity under the assumption maturity structure and balances are remain the same all year round at the end
of the year.
During the measurement of the Bank’s interest rate sensitivity, the profit/loss on the asset and liability items that are evaluated with market value are
determined by adding to/deducting from the difference between the expectancy value of the portfolio after one year in case there is no change in
interest rates and the value of the portfolio one year later, which is measured after the interest shock, the interest income to be additionally earned/to be
deprived of during the one year period due to the renewal or repricing of the related portfolio at the interest rates formed after the interest shock.
On the other hand, in the profit/loss calculation of assets and liabilities that are not evaluated by the current market prices, it is assumed that assets and
liabilities with fixed interest rates will be renewed at maturity date and the assets and liabilities having variable interest rates will be renewed at the end of
repricing period with the market interest rates generated after the interest shock.
Within this context, ceteris paribus, the possible changes that may occur in the Bank’s profit and shareholders’ equity in case of 100 basis point increase/
decrease in TL and FC interest rates on the reporting day are given below:
% Change in the Interest Rate (*)
Effect On Profit/Loss
Effect on Equity (**)
TL
FC
Current Period
Prior Period
Current Period
Prior Period
Money Market Funds
33,370,104
5,080,678
1,648,534
100 bps increase
100 bps increase
100 bps decrease
100 bps decrease
995,614
(1,307,172)
987,676
(1,762,490)
(2,975,711)
3,223,619
(1,809,125)
1,993,226
(*) Changes in interest rates is calculated assuming that the expectations reflected in inflation. The effects on the profit/loss and shareholders’ equity are stated with their before
tax values.
(**) The effect on the profit/loss is mainly arising from the fact that the average maturity of the Bank’s fixed rate liabilities is shorter than the average maturity of its fixed rate
assets.
Miscellaneous
Payables
Marketable Securities
Issued (***)
Funds Provided
from Other Financial
Institutions
5,136,114
Current Period
Up to 1 Month
1-3 Months
3-12 Months
1-5 Years
5 Years and
Over
Non-interest
Bearing
Total
Assets
Cash (Cash in Vault,
Foreign Currency
Cash, Money in
Transit, Cheques
Purchased) and
Balances with the
Central Bank of Turkey
7,453,621
191,476,032
198,929,653
Banks
9,966,090
575,776
12,492,763
23,034,629
Financial Assets at
Fair Value through
Profit/Loss (*)
Money Market
Placements
Financial Assets at
Fair Value Through
Other Comprehensive
Income
5,487,304
8,313,492
3,972,432
8,890,775
13,968
4,662,271
31,340,242
43,537,183
22,389,243
38,186,122
35,522,205
29,865,588
1,096,053
170,596,394
Loans
205,534,988
84,473,946
245,527,395
195,501,347
51,385,645
782,423,321
Financial Assets
Measured at Amortised
Cost
11,568,362
22,518,424
25,385,370
22,459,724
11,442,117
93,373,997
Other Assets (**)
217,258
108,407,174
108,624,432
Total Assets
283,764,806
138,270,881
313,071,319
262,374,051
92,707,318
318,134,293
1,408,322,668
Liabilities
Banks Deposits
Other Deposits
5,488,092
1,821,717
1,022,170
365,803,736
97,869,384
34,542,133
1,172,896
1,493,230
9,825,209
421,863,931
921,252,080
40,099,316
46,920,353
52,056,467
1,999,278
2,492,560
8,441,214
24,217,675
24,722,121
61,872,848
14,583,517
49,496,547
5,313,106
1,669,504
392,652
71,455,326
Other Liabilities (****)
2,804,710
3,054,187
3,104,091
664,262
1,499,857
240,634,315
251,761,422
Total Liabilities
429,185,551
159,815,073
54,071,248
27,724,337
26,614,630
710,911,829 1,408,322,668
Balance Sheet Long
Position
Balance Sheet Short
Position
Off Balance Sheet
Long Position
Off Balance Sheet
Short Position
259,000,071
234,649,714
66,092,688
559,742,473
(145,420,745)
(21,544,192)
(392,777,536)
(559,742,473)
7,421,791
22,871,812
30,293,603
(8,120,500)
(10,221,123)
(8,298,250)
(26,639,873)
Total Position
(137,998,954)
1,327,620
250,879,571
224,428,591
57,794,438 -392,777,536
3,653,730
(*) The balance includes derivative financial assets
(**) The expected loss provisions are shown in Non-Interest column.
(***) Includes Tier 2 subordinated bond which is classified on the balance sheet as subordinated loan.
(****) Equity is included in ‘’non-interest bearing’’ column.
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İşbank 2022 Integrated Annual Report 241
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Prior Period
Up to 1 Month
1-3 Months
3-12 Months
1-5 Years
5 Years and
Over
Non-interest
Bearing
Total
Assets
Cash (Cash in Vault,
Foreign Currency
Cash, Money in
Transit, Cheques
Purchased) and
Balances with the
Central Bank of Turkey
14,620,305
167,302,916
181,923,221
Banks
3,736,353
208,939
20,184,009
24,129,301
b. Average interest rates applied to monetary financial instruments:
Current Period
EUR
%
USD
%
JPY
%
TL
%
Assets
Cash (Cash in Vault. Foreign Currency Cash. Money in Transit. Cheques
Purchased) and Balances with the Central Bank of Turkey
Banks
Financial Assets at Fair Value through Profit/Loss
Money Market Placements
Financial Assets at Fair Value Through Other Comprehensive Income
8,199,318
9,326,626
7,138,279
5,623,571
3,530
2,205,050
32,496,374
Loans
Financial Assets Measured at Amortised Cost
19,965,684
16,404,869
13,928,740
19,161,533
17,516,956
577,294
87,555,076
Loans
96,042,600
44,023,134
144,511,067
181,377,115
48,139,857
114,977
514,208,750
Liabilities
Banks Deposits
Other Deposits
Money Market Funds
Miscellaneous Payables
Debt Securities Issued (*)
8,277,298
12,224,444
15,562,809
8,408,689
1,939,494
46,412,734
Funds Provided from Other Financial Institutions
Other Assets (**)
2,883,389
36,960,179
39,843,568
(*) Includes Tier 2 subordinated bond which is classified on the balance sheet as subordinated loan.
Total Assets
153,724,947
82,188,012
181,140,895
214,570,908
67,599,837
227,344,425
926,569,024
2.50
1.15
3.00
3.33
6.14
2.66
0.86
0.08
4.25
4.25
2.75
4.98
5.48
8.17
5.12
4.96
0.62
6.82
6.88
7.09
7.27
13.30
13.53
32.82
20.56
23.30
12.64
11.63
9.03
14.37
10.85
Prior Period
EUR
%
USD
%
JPY
%
TL
%
Assets
Cash (Cash in Vault. Foreign Currency Cash. Money in Transit. Cheques
Purchased) and Balances with the Central Bank of Turkey
Banks
Financial Assets at Fair Value through Profit/Loss
Money Market Placements
Financial Assets at Fair Value Through Other Comprehensive Income
Loans
Financial Assets Measured at Amortised Cost
Liabilities
Banks Deposits
Other Deposits
Money Market Funds
Miscellaneous Payables
Debt Securities Issued (*)
Funds Provided from Other Financial Institutions
0.15
1.92
3.29
4.42
2.92
0.11
0.03
1.86
0.20
2.59
4.82
5.26
3.37
0.38
0.13
1.49
6.50
2.44
8.50
11.39
14.41
22.06
18.15
18.84
15.50
11.57
13.98
18.22
13.75
(2,289,875)
(12,871,498)
(6,587,375)
(21,748,748)
(*) Includes Tier 2 subordinated bond which is classified on the balance sheet as subordinated loan.
Financial Assets at
Fair Value through
Profit/Loss (*)
Money Market
Placements
Financial Assets at
Fair Value Through
Other Comprehensive
Income
Financial Assets
Measured at Amortised
Cost
Miscellaneous
Payables
Marketable Securities
Issued (***)
Funds Provided
from Other Financial
Institutions
Balance Sheet Long
Position
Balance Sheet Short
Position
Off Balance Sheet
Long Position
Off Balance Sheet
Short Position
Liabilities
Banks Deposits
Other Deposits
1,599,410
1,084,200
1,261
254,580,741
33,534,194
18,275,640
1,244,478
Money Market Funds
42,595,997
2,299,805
3,339,693
1,584,249
1,062,316
3,747,187
284,246,136
591,881,189
48,235,495
22,947,587
24,531,836
1,249,305
4,923,360
22,221,079
22,368,163
17,344,902
68,106,809
3,628,174
37,755,079
22,277,040
1,684,916
306,217
65,651,426
Other Liabilities (****)
3,998,152
3,949,203
3,646,271
1,453,969
1,286,172
110,081,315
124,415,082
Total Liabilities
309,236,028
83,545,841
69,760,984
26,751,526
18,937,291
418,337,354
926,569,024
111,379,911
187,819,382
48,662,546
347,861,839
(155,511,081)
(1,357,829)
(190,992,929)
(347,861,839)
6,817,975
17,021,725
23,839,700
Total Position
(148,693,106)
15,663,896
109,090,036
174,947,884
42,075,171
(190,992,929)
2,090,952
(*) The balance includes derivative financial assets
(**) The expected loss provisions are shown in Non-Interest column.
(***) Includes Tier 2 subordinated bond which is classified on the balance sheet as subordinated loan.
(****) Equity is included in ‘’non-interest bearing’’ column.
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242 İşbank 2022 Integrated Annual Report
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Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
V.
Explanations on Equity Shares Risk Arising from Banking Book
VI.
Explanations on Liquidity Risk Management and Liquidity Coverage Ratio
a. Accounting policies related to equity investments in associates and subsidiaries can be seen in the Section Three Note III.2.
b. Balance Sheet Value of Equity Investment, fair value, and for publicly traded, if the market value is different from the fair value comparison to the market
price:
Investments in Shares
Quoted
Investments in Shares Group A
Subsidiaries
Financial Subsidiaries
Non-Financial Subsidiaries
Non-Quoted
Subsidiaries
Financial Subsidiaries
Non-Financial Subsidiaries
Associates
Financial Associates
Non-Financial Associates
Book Value
Comparison
Fair Value
Market Value (*)
60,237,024
132,854,654
22,198,019
38,975,666
385,225
14,157
15,175,351
3,111,056
(*) Represents the sum of the market values of the related companies.
c. Information on revaluation surpluses and unrealized gains/losses on equity securities and results included in Common Equity and Tier II Capital
Portfolio
1
2
Private Equity
Investments
Shares Traded on a
Stock Exchange
3 Other Stocks
4 Total
Realized
Gains/losses
During the
period
Revaluation Increases
Unrealized Gains and Losses
Total
Including into Tier I
Capital (*)
Total
Including into
Common Equity
Including into
Tier II Capital
56,681,532
56,681,532
12,072,255
68,753,787
12,072,255
68,753,787
(*) Represents the amounts reflected to equity according to the equity method.
d. Capital requirement as per equity shares:
Portfolio
Carrying Value
Total RWA
Minimum Capital Requirement
Private Equity Investments
Share Traded on a Stock Exchange
Other Stocks
Total
61,173,685
18,685,789
79,859,474
61,173,685
16,582,702
77,756,387
4,893,895
1,326,616
6,220,511
Liquidity risk may occur as a result of funding long-term assets with short-term liabilities; The Bank’s liquidity is managed by the Asset-Liability
Management Committee in accordance with the business strategies, legal requirements, current market conditions and expectations regarding the
economic and financial conjuncture.
The Bank’s principal source of funding is deposits. Although the average maturity of deposits is shorter than that assets as a result of the market
conditions, the Bank’s wide network of branches and stable core deposit base are its most important safeguards of funding. Additionally, the Bank
borrows medium and long-term funds from institutions abroad. Concentration limits are generally used in deposit and non-deposit borrowings in order
to prevent adverse effects of concentrations in the liquidity risk profile of the Bank.
In order to meet the liquidity requirements that may arise from market fluctuations, considerable attention is paid to the need to preserve liquidity and
efforts in this respect are supported by projections of Turkish Lira and Foreign Currency (FC) cash flows. The term structure of TL and FC deposits, their
costs and amounts are monitored on a daily basis. During these studies historical events and future expectations are taken into account as well. Based
upon cash flow projections, prices are differentiated for different maturities and measures are taken accordingly to meet liquidity requirements. Moreover,
potential alternative sources of liquidity are determined to be used in case of extraordinary circumstances.
The liquidity risk exposure of the Bank has to be within the risk capacity limits which are prescribed by the legislation and the Bank’s risk appetite defined
in its business strategy. It is essential for the Bank to have an adequate level of unencumbered liquid asset stock which can be sold or pledged, in case a
large amount of reduction in liquidity sources occurs. The level of liquid asset buffer is determined in accordance with the liquidity risk tolerance which
is set by the Board of Directors. Asset-Liability Management Committee is responsible for monitoring the liquidity position, determining appropriate
sources of funds and deciding the maturity structure in accordance with the limits which are set by the Board of Directors.
The Treasury Division is responsible for monitoring the liquidity risk, in accordance with the Asset and Liability Management Risk Policy limits,
objectives set out in the business plan and the decisions taken at the meetings of Asset-Liability Management Committee. The Treasury Division is also
responsible for making liquidity projections and taking necessary precautions to reduce liquidity risk, by using the results of stress testing and scenario
analysis. Within this scope, Treasury Division is monitoring the Turkish Lira (TL) and foreign currency (FC) liquidity position instantly and prospectively
based on the information provided from the branches, business units and IT infrastructure of the Bank. The assessment of long-term borrowing
opportunities is carried out regularly in order to balance the cash inflows and outflows and to mitigate the liquidity risk. The Bank creates liquidity through
repurchase agreements and secured borrowings based on the high quality liquid asset portfolio, through securitization and other structured finance
products which are created from the asset pools like credit card receivables and retail loans.
The Bank applies liquidity stress tests to measure liquidity risk. In this approach, in liquidity stress scenarios in which parameters are determined by the
Board of Directors, the ability of the Bank’s liquid assets’ in covering cash outflows within a one-month horizon has been described. Liquidity adequacy
limits for TL and FC are determined by Board of Directors, based on the liquidity requirements and risk tolerance of the Bank. The liquidity risk is
measured by the Risk Management Division and results are reported to the related executive functions, senior management and Board of Directors.
It is essential for the Bank to monitor the liquidity position and funding strategy continuously. In case of a liquidity crisis that may arise from unfavorable
market conditions, extraordinary macroeconomic situations and other reasons which are beyond the control of the Bank, “Emergency Action and
Funding Plan” is expected to be commissioned. In that case, related committees have to report the precautions taken and their results to the Board of
Directors through Audit Committee.
The Bank’s Foreign Currency (FC) and total (TL+FC) liquidity coverage ratio averages for the last three months, the highest value and the lowest value
occurred in this period are given below.
31.10.2022
30.11.2022
31.12.2022
Current Period
Current Period
TL+FC
FC
TL+FC
FC
160.65
155.09
154.99
457.48
467.81
487.23
156.66
172.64
199.25
434.83
468.88
507.82
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244 İşbank 2022 Integrated Annual Report
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Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Grubun konsolide yabancı para ve toplam (YP+TP) likidite karşılama oranlarının son üç aylık döneme ilişkin ortalamalarına aşağıda yer verilmektedir.
Likidite karşılama oranı:
Prior Period
HIGH QUALITY LIQUID ASSETS
High Quality Liquid Assets
CASH OUTFLOWS
Total Unweighted Value (*)
Total Weighted Value (*)
TL+FC
FC
TL+FC
FC
308.711.858
204.903.813
Retail and Small Business Customers, of which;
611.317.338
377.077.839
56.151.478
37.707.784
Stable deposits
Less stable deposits
Unsecured funding, of which;
Operational deposits
Non-operational deposits
Other unsecured funding
Secured funding
Other cash outflows, of which;
Derivatives cash outflow and liquidity needs related to market valuation
changes on derivative or other transactions
Obligations related to structured financial products
Commitments related to debts to financial markets and other off-
balance sheet obligations
Other revocable off-balance sheet commitments and contractual
obligations
99.605.132
4.980.257
511.712.206
377.077.839
51.171.221
37.707.784
334.798.824
187.403.972
168.815.630
98.329.464
3.005.540
36.219
739.822
9.055
227.527.733
151.835.763
100.701.866
66.519.903
104.265.551
35.531.990
67.373.942
31.800.506
8.511.344
19.369.975
8.511.344
19.369.975
224.756
13.731
3.273.748
14.132.379
3.273.748
14.132.379
5.237.596
5.237.596
5.237.596
5.237.596
80.267.478
73.076.139
4.013.374
3.653.807
Other irrevocable or conditionally revocable off-balance sheet obligations
426.353.159
175.080.021
36.996.071
15.510.864
TOTAL CASH OUTFLOWS
CASH INFLOWS
Secured lending
Unsecured lending
Other cash inflows
274.712.653
174.585.625
4.195.089
500.968
100.584.121
65.700.311
74.655.489
54.622.443
2.727.740
116.821.011
2.727.740
116.821.011
TOTAL CASH INFLOWS
107.506.950
182.521.322
77.884.197
171.443.454
TOTAL HQLA STOCK
TOTAL NET CASH OUTFLOWS
LIQUIDITY COVERAGE RATIO (%)
(*) The simple arithmetic average calculated for the last three months of the weekly simple arithmetic average.
Upper Limit Applied Value
308.711.858
204.903.813
196.828.456
43.646.406
156,91
470,84
Prior Period
HIGH QUALITY LIQUID ASSETS
High Quality Liquid Assets
CASH OUTFLOWS
Total Unweighted Value (*)
Total Weighted Value (*)
TL+FC
FC
TL+FC
FC
196.731.749
137.922.605
Retail and Small Business Customers, of which;
385.342.542
255.632.298
35.792.010
25.563.230
Stable deposits
Less stable deposits
Unsecured funding, of which;
Operational deposits
Non-operational deposits
Other unsecured funding
Secured funding
Other cash outflows, of which;
Derivatives cash outflow and liquidity needs related to market valuation
changes on derivative or other transactions
Obligations related to structured financial products
Commitments related to debts to financial markets and other off-
balance sheet obligations
Other revocable off-balance sheet commitments and contractual
obligations
54.844.879
2.742.244
330.497.663
255.632.298
33.049.766
25.563.230
187.046.797
112.910.239
95.886.913
56.879.781
1.255.644
16.359
313.911
4.090
134.597.977
98.576.273
60.491.359
43.239.644
51.193.176
14.317.607
35.081.643
13.636.047
8.505.992
12.874.684
8.505.992
12.874.684
65.495
53.327
4.375.826
8.744.518
4.375.826
8.744.518
4.130.166
4.130.166
4.130.166
4.130.166
53.066.816
46.671.687
2.653.341
2.333.584
Other irrevocable or conditionally revocable off-balance sheet obligations
287.990.929
156.050.151
29.290.631
17.577.368
TOTAL CASH OUTFLOWS
CASH INFLOWS
Secured lending
Unsecured lending
Other cash inflows
TOTAL CASH INFLOWS
TOTAL HQLA STOCK
TOTAL NET CASH OUTFLOWS
LIQUIDITY COVERAGE RATIO (%)
149.840.013
102.080.414
112.194
36.588
1.571
1.356
63.377.888
46.531.386
52.758.960
40.975.721
7.972.830
61.206.589
7.972.830
61.206.589
71.462.912
107.774.563
60.733.361
102.183.666
Upper Limit Applied Value
196.731.749
137.922.605
111.461.021
29.261.943
176,18
470,51
(*) The simple arithmetic average calculated for the last three months of the weekly simple arithmetic average.
Compared to the prior quarter, in the fourth quarter of 2022, it is observed that the total liquidity coverage ratio decreased due to the increase in net cash
outflows, and the FC liquidity coverage ratio due to the decrease in the high-quality liquid asset stock. Total and Foreign Currency liquidity coverage
ratios are continuing to hover far above the minimum level (respectively 100% and 80%) pursuant to legal legislations.
The Liquidity Coverage Ratio which has been introduced to ensure banks to preserve sufficient stock of high-quality assets to meet their net cash
outflows that may occur in the short term is calculated as per the Communiqué on “Measurement and Assessment of the Liquidity Coverage Ratio of
Banks’ published by BRSA. The ratio is directly affected by the level of unencumbered high-quality assets which can be liquidated at any time and net
cash inflows and outflows arising from the Bank’s assets, liabilities and off-balance sheet transactions.
The Bank’s high quality liquid asset stock primarily consists of cash, the accounts held at CBRT and unencumbered government bonds which are issued
by Turkish Treasury.
The Bank’s principal source of funding is deposits. In terms of non-deposit borrowing, funds received from repurchase agreements, marketable
securities issued, and funds borrowed from financial institutions are among the most significant funding sources of the Bank.
In order to manage liquidity effectively, concentration of liquidity sources and usages should be avoided. Due to the strong and stable core deposit
base of the Bank, deposits are received from a diversified customer portfolio. In addition, in order to provide diversification in liquidity sources and
usages, liquidity concentration limits are used effectively. Total amount of funds borrowed from a single counterparty, or a risk group is closely and
instantaneously monitored, taking liquidity concentration limits into account. In addition to these, the cumulative liquidity deficits that the Bank is
exposed to in various maturity tranches are periodically monitored and reported to the senior management.
Cash flows of derivatives that will take place within 30 days are taken into account in calculation of liquidity coverage ratio. Cash outflows of derivatives
that arise from margin obligations, are reflected to the results in accordance with the methodology articulated in the related legislation.
Liquidity risk of the Bank, its foreign branches and subsidiaries that are to be consolidated are managed within the regulatory limits and in accordance
with the group strategies. For the purposes of effectiveness and sustainability of liquidity management, funding sources of group companies and
funding diversification opportunities in terms of markets, instruments and tenor are evaluated and liquidity position of the group companies are
monitored continuously by the Bank.
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246 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 247
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
1,096,053
1,505,925
3,095,119
18,934,956
91,349,350
54,614,991
170,596,394
(*) Includes Tier 2 subordinated bond which is classified on the balance sheet as subordinated loan.
Presentation of assets and liabilities according to their remaining maturities:
Demand
Up to 1 Month
1-3 Months
3-12 Months
1-5 Years
5 Years and
Over
Unallocated
(*)
Total
79,630,417
119,299,236
Banks
16,625,971
5,832,882
575,776
4,658,978
5,485,456
8,234,431
4,048,809
8,895,585
16,983
Loans (***)
31,261,330
119,501,530
100,458,392
263,208,574
195,030,371
49,828,994
23,134,130
782,423,321
1,658,093
3,209,619
8,665,369
51,201,710
28,639,206
93,373,997
6,285,141
212,363
37
2,355,006
99,771,885
108,624,432
133,272,749 259,568,263
115,785,700
294,857,745 348,832,022
133,100,174
122,906,015
1,408,322,668
1,493,230
5,488,092
1,821,717
1,022,170
421,863,931
365,803,050
97,868,730
34,539,016
1,177,353
5,666,537
4,524,983
39,707,047
20,469,591
1,087,168
33,370,104
2,981,131
3,748,081
876,714
1,337,301
8,441,214
25,340,239
25,877,380
51,195,195
437,127
1,595
14,823,376
8,500,566
3,493,053
422,550
1,001,019
447,166
223,496,242
251,761,422
423,357,161
477,223,068
117,471,555
90,952,176
48,410,752
27,411,714
223,496,242 1,408,322,668
198,929,653
23,034,629
31,340,242
9,825,209
921,252,080
71,455,326
40,099,316
61,872,848
52,056,467
Current Period
Assets
Cash (Cash in Vault, Foreign
Currency Cash, Money in Transit,
Cheques Purchased) and
Balances with the Central Bank
of Turkey
Financial Assets at Fair Value
through Profit/Loss (**)
Money Market Placements
Financial Assets at Fair Value
Through Other Comprehensive
Income
Financial Assets Measured at
Amortised Cost
Other Assets
Total Assets
Liabilities
Bank Deposits
Other Deposits
Funds Provided from Other
Financial Institutions
Money Market Funds
Marketable Securities Issued
(****)
Miscellaneous Payables
Other Liabilities
Total Liabilities
Liquidity Gap
Net Off Balance Sheet Position
Derivative Financial Assets
Derivative Financial Liabilities
Prior Period
Total Assets
Total Liabilities
Liquidity Gap
In compliance with the “TFRS 7”, the following table indicates the maturities of the Bank’s major financial assets and liabilities which are not qualified as
derivatives. The following tables have been prepared by referencing the earliest dates of collections and payments without discounting the liabilities.
The interest to be collected from and paid to the related liabilities is included in the following table. Adjustments column shows the items that may cause
possible cash flows in the following periods. The values of the related liabilities registered in balance sheet do not include these amounts.
Current Period
Demand
Up to 1
Month
1-3 Months
3-12 Months
1-5 Years
5 Years and
Over
Total
Adjustments
(-)
Balance
Sheet Value
Liabilities
Deposits
Funds Provided from
Other Financial Institutions
Money Market Funds
Marketable Securities
Issued (*)
Leasing Liabilities
423,357,161
372,260,825
101,422,669
36,748,019
1,253,490
935,042,164
3,964,875
931,077,289
5,717,510
5,097,548
42,112,957
23,320,862
1,152,166
77,401,043
5,945,717
71,455,326
33,407,213
3,036,464
3,863,524
40,307,201
207,885
40,099,316
1,460,631
1,425,574
11,991,684
34,125,926
28,795,298
77,799,113
15,926,265
61,872,848
63,333
144,014
522,280
1,694,169
2,267,874
4,691,670
2,539,463
2,152,207
Prior Period
Demand
Up to 1
Month
1-3 Months
3-12 Months
1-5 Years
5 Years and
Over
Total
Adjustments
(-)
Balance
Sheet Value
Liabilities
Deposits
Funds Provided from
Other Financial Institutions
Money Market Funds
Marketable Securities
Issued (*)
Leasing Liabilities
285,308,452
256,676,019
35,076,238
18,499,054
1,293,714
596,853,477
1,225,101 595,628,376
1,659,611
8,456,296
36,706,015
19,613,123
1,416,626
67,851,671
2,200,245
65,651,426
42,654,340
2,304,287
3,370,651
48,329,278
93,783
48,235,495
1,635,592
2,834,652
25,742,077
31,141,372
23,533,539
84,887,232
16,780,423
68,106,809
47,228
105,530
333,691
1,301,918
2,043,284
3,831,651
2,131,212
1,700,439
(*)Includes Tier 2 subordinated bond which is classified on the balance sheet as subordinated loan.
The following table shows the remaining maturities of non-cash loans of the Bank.
Current Period
Demand
Up to 1
Month
1-3 Months
3-12 Months
1-5 Years
5 Years and
Over
Total
Adjustments
(-)
Balance
Sheet Value
(290,084,412)
(217,654,805)
(1,685,855) 203,905,569
300,421,270 105,688,460 (100,590,227)
Letters of Credit
21.031.210
4.695.440
8.170.572
19.349.001
53.246.223
3.964.875
931.077.289
Non-cash Loans
130,994,153
7,489,287
19,034,472
64,412,078
19,239,252
5,527,272
1,675,458
(1,424,161)
1,531,226
2,316,880
560,500
160,788,294
67,410,871
38,610,607
69,998,675
71,033,244
159,112,836
68,835,032
37,079,381
67,681,795
70,472,744
4,659,903
407,841,691
403,181,788
246,696,514
Letters of Guarantee
108.829.989
2.377.323
9.901.311
37.543.763
17.674.969
2.955.329
179.282.684
5.945.717
71.455.326
Acceptances
Other
Total
137.720
995.234
416.524
923.075
7.433.282
420.875
39.514
86.032
1.143.408
2.571.943
9.331.476
4.836.131
207.885
40.099.316
130.994.153
7.489.287
19.034.472
64.412.078
19.239.252
5.527.272 246.696.514
15.926.265
61.872.848
Prior Period
Demand
Up to 1
Month
1-3 Months
3-12 Months
1-5 Years
5 Years and
Over
Total
Adjustments
(-)
Balance
Sheet Value
143,072,463
153,235,665
65,644,687
161,256,464 263,201,666
86,896,229
53,261,850
926,569,024
Letters of Credit
39.975.559
299.733
853.893
1.753.195
12.823
42.895.203
3.964.875
931.077.289
285,308,452
335,053,148
53,535,693
83,497,127
44,129,952
21,414,802
103,629,850
926,569,024
Letters of Guarantee
75.331.583
1.272.415
6.663.085
32.272.226
12.915.460
3.042.724
131.497.493
5.945.717
71.455.326
Acceptances
Other
Total
583.828
875.751
1.028.920
2.256.076
10.359.840
553.187
14.781.851
207.885
40.099.316
14.840
115.302
1.085.273
2.169.710
4.260.876
116.766.721
2.615.908
9.773.054
44.500.563
14.566.743
5.212.434 193.435.423
15.926.265
61.872.848
(142,235,989)
(181,817,483)
12,108,994
77,759,337
219,071,714
65,481,427 (50,368,000)
Net Off Balance Sheet Position
Derivative Financial Assets
Derivative Financial Liabilities
3,200,930
2,669,768
(75,036)
1,505,529
446,812
133,805,197
54,101,623
37,634,533
45,771,066
61,283,833
130,604,267
51,431,855
37,709,569
44,265,537
60,837,021
Non-cash Loans
116,766,721
2,615,908
9,773,054
44,500,563
14,566,743
5,212,434
7,748,003
332,596,252
324,848,249
193,435,423
(*) Asset items, such as Tangible Assets, Subsidiaries and Associates, Office Supply Inventory, Prepaid Expenses and Non-Performing Loans, which are required for banking operations and which cannot be
converted into cash in short-term, other liabilities such as Provisions which are not considered as payables and Shareholders’ Equity, are shown in the “Unallocated” column.
(**) Includes Derivative financial assets.
(***) Nonperforming loans are included in “Unallocated” column.
(****) Includes Tier 2 subordinated bond which is classified on the balance sheet as subordinated loan.
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Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
The following table shows the remaining maturities of derivative financial assets and liabilities of the Bank.
Current Period
Up to 1 Month
1-3 Months
3-12 Months
1-5 Years
5 Years and
Over
Total
31,365,835
30,918,439
On-Balance sheet items
On-balance sheet items (excluding derivatives and SFTs, but including collateral)
Assets amounts deducted from Tier 1 capital
Total on balance sheet exposures
2,376,097
2,406,304
66,850,977
67,211,082
319,914,249
Derivative exposures and credit derivatives
Forwards Contracts-Buy
Forwards Contracts-Sell
Swaps Contracts-Buy
Swaps Contracts-Sell
Futures Transactions-Buy
Futures Transactions-Sell
Options-Call
Options-Put
Other
Total
Forwards Contracts- Buy
Forwards Contracts- Sell
Swaps Contracts-Buy
Swaps Contracts-Sell
Futures Transactions-Buy
Futures Transactions-Sell
Options-Call
Options-Put
Other
Total
5,717,551
5,697,764
130,035,589
147,228,461
25,945
25,402
3,538,061
3,553,528
10,756,575
10,520,109
42,160,572
53,156,757
671,422
811,948
1,557,467
1,551,533
12,515,612
12,294,262
13,656,029
55,041
50,766
5,545,458
4,879,934
24,078,829
15,059,520
13,676,934
13,015,952
64,503,890
66,650,582
344,555,642
707,612
707,612
127,978
3,822,162
3,822,162
752,408
888,116
15,170,760
14,514,769
52,943,261
319,901,130
136,245,903
75,689,988
137,680,470
141,505,988
811,023,479
Prior Period
Up to 1 Month
1-3 Months
3-12 Months
1-5 Years
5 Years and
Over
Total
30,156,697
30,059,393
4,585,527
4,427,855
107,655,756
6,561,281
6,546,390
40,811,617
14,439,205
14,527,936
4,570,684
4,557,212
17,078,760
40,956,563
58,258,759
264,761,455
121,096,795
41,894,966
17,111,486
39,464,506
57,811,947
277,379,700
96,253
86,971
2,944,784
2,842,085
3,749,131
591,730
595,436
4,012,940
3,962,813
3,023,796
5,079,666
4,945,190
16,618,675
3,025,074
3,025,074
487,638
687,983
682,407
15,062,464
14,775,162
23,879,240
264,409,464
105,533,478
75,344,102
90,036,603
122,120,854
657,444,501
VII.
Explanations on Leverage Ratio
a. Explanations on Differences Between Current and Prior Years’ Leverage Ratios
Replacement cost associated with derivative financial instruments and credit derivatives
The potential amount of credit risk with derivative financial instruments and credit derivatives
The total amount of risk on derivative financial instruments and credit derivatives
Investment securities or commodity collateral financing transactions
The amount of risk investment securities or commodity collateral financing transactions
(Excluding on balance sheet items)
Risk amount of exchange brokerage operations
Total risks related with securities or commodity financing transactions
Off -Balance Sheet Items
Gross notional amount of off-balance sheet items
Adjustments for conversion to credit equivalent amounts
The total risk of off-balance sheet items
Capital and Total Exposures
Tier 1 Capital
Total Exposures
Leverage Ratio
Leverage Ratio
(*) Three-month average of the amounts in Leverage Ratio table.
VIII.
Explanations on Other Price Risks
Current Period (*)
Prior Period (*)
1,352,238,923
(3,039,822)
1,349,199,101
16,095,379
5,788,378
21,883,757
843,622,223
(1,492,485)
842,129,738
21,043,586
3,570,324
24,613,910
12,032,913
4,020,316
12,032,913
4,020,316
452,575,932
(10,541,558)
442,034,374
317,341,135
(9,508,394)
307,832,741
167,776,503
1,825,150,145
79,582,511
1,178,596,705
9.19
6.75
The Bank is exposed to stock price risk due to its investments in companies being traded on the Borsa İstanbul A.Ş. (BIST).
The Bank's sensitivity to stock price risk at the reporting date was measured with an analysis. In the analysis, with the assumption of all other
variables were held constant and the data (stock prices) used in the valuation method are 10% higher or lower. According to this assumption,
in shares traded in Borsa Istanbul and followed under Financial Assets at Fair Value through Profit or Loss account, expected to have an effect
amounting to TL 49,896 increase/decrease.
The Bank’s unconsolidated leverage ratio is calculated in accordance with the principles of the “Regulation on Measurement and Evaluation of Banks’
Leverage Level”. The Bank’s consolidated Leverage ratio is 9.19% (December 31, 2021: 6.75). According to Regulation the minimum leverage ratio is 3%.
The changes in the leverage ratio are mostly due to the increase in total risk amounts.
IX.
1.
Explanations on Presentation of Assets and Liabilities at Fair Value
Information on fair values of financial assets and liabilities
b. Explanations on leverage ratio:
Financial Assets
Money Market Placements
Banks
Financial Assets at Fair Value through Other Comprehensive
Income
Investments Financial Assets Measured Amortized Cost
Loans
Financial Liabilities
Banks Deposits
Other Deposits
Funds Provided from Other Financial Institutions
Marketable Securities Issued (*)
Miscellaneous Payables
Book Value
Fair value
Current Period
Prior Period
Current Period
Prior Period
23.034.629
24.129.301
23.033.858
24.129.488
170.596.394
87.555.076
170.596.394
87.555.076
93.373.997
759.289.191
46.412.734
112.124.518
47.220.154
493.378.191
753.631.585
473.839.057
9.825.209
3.747.187
9.756.498
3.720.360
921.252.080
591.881.189
921.349.972
591.066.944
71.455.326
61.872.848
52.056.467
65.651.426
68.106.809
24.531.836
70.881.361
59.860.194
52.056.467
64.104.888
65.538.148
24.531.836
(*) Includes subordinated bonds which are classified on the balance sheet as subordinated loans.
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250 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 251
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Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Strike prices, quotations, market prices determined by the CBRT and published in the Official Gazette and the values calculated by using alternative
models, are taken as the basis in the fair value determination of Financial Assets at fair value through other comprehensive income.
When the prices of the financial assets measured at amortized cost cannot be measured in an active market, fair values are not deemed to be reliably
determined and amortized cost, calculated by the internal rate of return method, are taken into account as the fair values.
Fair values of banks, loans granted, deposits and funds borrowed from other financial institutions and marketable securities are calculated by
discounting the amounts in each maturity bracket formed according to repricing periods, using the rate corresponding to relevant maturity bracket in the
discount curves based on current market conditions.
2.
Information on fair value measurements recognized in the financial statements
“TFRS 13 - Fair Value Measurement” standard requires the items, which are recognized in the balance sheet at their fair values to be shown in the notes
by being classified within a range. According to this, the related financial instruments are classified into three levels in such a way that they will express
the significance of the data used in fair value measurements. At the first level, there are financial instruments, whose fair values are determined according
to quoted prices in active markets for identical assets or liabilities, at the second level, there are financial instruments, whose fair values are determined
by directly or indirectly observable market data, and at the third level, there are financial instruments, whose fair values are determined by the data, which
are not based on observable market data. The financial assets, which are recognized in the balance sheet at their values, are shown below as classified
according to the aforementioned principles of ranking.
Current Period
Level 1
Level 2
Level 3
Financial Assets at Fair Value Through Profit and Loss
Debt Securities
Equity Securities
Derivative Financial Assets at Fair Value through Profit
and Loss
Other
Financial Assets at Fair Value Through Profit or Loss (*)
Debt Securities
Equity Securities
Other
Derivative Financial Liabilities
4,109,370
498,961
55,286,765
5,542,596
333,165
17,029,298
3,826,852
113,862,747
978,103
8,840,818
350,829
(*) Since they are not traded in an active market, the equity securities TL 34,246 under the financial assets at fair value through other comprehensive income are shown in the
financial statements at acquisition cost and the related securities are not shown in this table.
Prior Period
Level 1
Level 2
Level 3
Financial Assets at Fair Value Through Profit and Loss
Debt Securities
Equity Securities
Derivative Financial Assets Held for Trading
Other
Financial Assets Available-for-Sale (*)
Debt Securities
Equity Securities
Other
Derivative Financial Liabilities
477,614
207,096
45,397,989
6,006,316
458,185
21,924,166
1,536,281
41,329,574
518,082
24,966
12,586,533
1,886,716
250,219
(*) Gerçeğe uygun değer farkı diğer kapsamlı gelire yansıtılan finansal varlıklar kalemi altındaki 34.246 TL’lik menkul kıymetler aktif bir piyasada işlem görmemeleri nedeniyle
finansal tablolara elde etme maliyeti üzerinden yansıtılmış olup, söz konusu kıymetler bu tabloda gösterilmemiştir.
The loans measured at fair value through profit and loss under Level 3 consists of loan granted to the special purpose entity which is disclosed in the
Section V footnote I-f.2 and footnote I.r. The mentioned loan’s fair value is determined by the various valuation methods. The potential changes in the
fundamental estimations and assumptions in the valuation work may affect the carrying fair value of the loan.
X.
Explanations on Transactions Carried Out on Behalf of Third Parties and Fiduciary Transactions
The Bank gives trading and custody services in the name and on the account of its customers. The Bank has no fiduciary transactions.
XI.
Explanations on Risk Management Objectives and Policies
Explanations according to “Communiqué on Public Disclosures about Risk Management” published on the Official Gazette No.29511 dated October 23,
2015 are included below. The Bank uses the Standardized Approach for calculation of capital charge for credit risk, therefore explanations about internal
ratings-based approach are not included.
a. General Information on Risk Management Approach and Risk Weighted Amounts:
a1 The Bank's risk management approach
Bank is exposed to financial and non-financial risks which are required to be analyzed, monitored, and reported within specific risk management
principles of the Bank and with the perspective of risk management. The risk management process is organized within the framework of risk
management and serves the creation of a common risk culture in corporate level, which brings “corporate governance” to forefront, the independence
of the internal audit and monitoring units from the business units that undertake risks is established risk is defined in accordance with international
regulations and in this context measurement, analysis, monitoring, reporting, and control functions are carried.
Risk management process and the functions involved in the process is one of the primary responsibilities of the Board of Directors. The Risk
Committee operates to prepare the Bank's risk management strategies and policies, submit them to the Board of Directors for approval and monitor
the implementations. Evaluating the capital adequacy and observing the active use of results in Bank’s planning and decision-making processes,
establishing and monitoring limits related to main risks, monitoring the activities of risk management (determining, defining, measuring, evaluating and
managing risk) and monitoring results and methods in measuring risk are also under their authority and responsibility of the Committee. Committee
reports activity results to the Board of Directors through Audit Committee.
The Operational Risk Committee is engaged in determining strategies and policies for the management of operational risks that the Bank may be
exposed to, developing an operational risk management framework, and strengthening the governance model for operational risks. The Committee
reports the results of its activities to the Board of Directors through the Audit Committee.
The Risk Management Department, which reports to the Board of Directors of the Parent Bank through the Internal Systems Manager; organized as
Asset-Liability Management Unit, Credit Risk Management Unit, Credit Risk Analytics and Control Unit, Operational Risk and Affiliate Risk Unit, Model
Risk and Validation Unit, Internal Capital Assessment Process and Economic Capital Unit.
The Bank’s risk management process is carried out within the framework of risk policies which are issued by the Board of the Directors via Internal
Systems Manager by taking the recommendations of the Risk Management Department into account and which include the written standards that
are implemented by the business units. These policies which are entered into force in line with the international practices are general standards which
contain organization and scope of the risk management function, risk measurement policies, duties and responsibilities of the risk management group,
procedures for determining risk limits, ways to eliminate limit violations, compulsory approvals, and confirmations to be given in a variety of events and
situations.
In the aforementioned risk policies, the Bank’s risk appetite framework is defined as a set of approaches that determine the risk capacity, the risk
appetite, the risk tolerance and that include the policies, procedures, controls and systems for reporting and monitoring of the limits set for the Bank’s risk
profile and the indicators in the framework. The Bank's risk appetite framework, which is formed in accordance with the above-mentioned factors and
entered into force with the Board of Directors approval, includes indicators that are aligned with the business plan, the strategic programme, capital and
remuneration planning and comparable on a business unit level to the extent possible. The compliance to the limits within the framework is periodically
monitored and the realization of the risk appetite indicators are reported to the Risk Committee and the Boards on a monthly basis.
In order to build a strong corporate culture that has a risk management perspective, the Bank has policies, processes, systems and a control system that
is integrated with the Bank’s risk management system to effectively control the bank's risk management system is available. All employees of the Bank
essentially perform their duties in a responsible manner that aims to develop controls to reduce or eliminate the probability of the Bank to incur losses
related to the operational risks. In the process risk analysis studies, risks and the related controls are evaluated together with employees performing the
relevant process in a holistic approach. Procedures to be followed in case of a risk threshold breach and risk definitions are given in the risk politics.
Code of conducts, operation manuals, the sharing of duties between business units and risk units are announced to the Bank’s staff.
The risk reports that analyse the results reached by the Bank and the comprehensive risk assessment and comparison of these results with a risk
management perspective are periodically submitted to the Risk Committee and to the Board through the Audit Committee. The content of the above
mentioned reports could be summarised as follows:
ੵ Capital adequacy ratio, the progression of the components of this ratio and the issues that affect the aforementioned ratio,
ੵ Monitoring the compliance status of the limits set by the Board of Directors as a part of the risk appetite framework and based on the components of
The movement table of financial assets at level 3 is given below:
the main risk types,
Balance at the Beginning of the Period
Purchases
Redemption or Sales (*)
Valuation Difference
Transfers
Balance at the end of the Period
Current Period
Prior Period
2,136,935
(1,886,716)
100,610
350,829
2,243,397
(5,852)
(100,610)
2,136,935
(1) As the details are given in the Fifth Section Note I-b.3, between the company and the TVF for the sale of all A group registered shares corresponding to 55% of the capital
of the company owned by the special purpose company to the Turkish Wealth Fund (TVF). A share transfer agreement was signed, and the sale and transfer transaction were
realized on 31.03.2022.
Real estates which are presented in the financial statements at fair value are classified at level 3.
ੵ In addition to the assessment of the loan portfolio on the basis of counterparties and loan types, monitoring of the portfolio as a whole according to
parameters such as maturity, sector, geography, risk ratings, arrears, defaults,
ੵ Measuring the assets and liabilities management risk, and reporting of measurement results,
ੵ Monitoring of all risks assessed in the context of operational risk within the scope of non-financial risks, including operational risk, loss events that
occurred in the Bank and risk indicators,
ੵ Testing the measurement results in terms of completeness and reliability,
ੵ Analysing the level of risk indicators under various stress scenarios,
ੵ Examining various concentration indicators and the course followed by these indicators
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252 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 253
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Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
As per the communique on “Bank’s Internal Systems and Internal Capital Adequacy and Assessment Process” and “Guidelines for Stress Testing of
Banks to Use in Capital and Liquidity Planning”, stress tests are conducted for the entire risks that the Bank is exposed to and on the basis of significant
risk categories. As a part of the holistic stress tests, risk appetite, capital planning, strategic plan and budget, action plans for emergencies and
unexpected situations related to miscellaneous risks and other issues considered as significant are taken into consideration. In the holistic and individual
stress test processes carried out by the Bank, the most advanced approaches used in risk measurement in the Bank are used as much as possible,
together with the methods that are the basis of legal reporting (standard approaches for credit and market risk, basic indicator approach for operational
risk).
In the stress tests, both the first pillar risks (credit risk, market risk, operational risk) in scope of the regulatory framework and all the other risks that
the Bank is exposed to independent of the regulatory framework are taken into account in a holistic perspective. In determining the course of capital
adequacy under various scenarios during the planning horizon, the actions that the Bank will take in case of stress conditions and the impact of the
diversified growth strategies of business units on the capital adequacy and the balance sheet are considered.
The levels at which the capital adequacy ratio of the Bank will reach are estimated and monitored with stress tests. In addition, reverse stress tests are
carried out regularly, by determining the problematic loan growth rate and increase in exchange rates, which will cause the Bank's capital adequacy to
fall within the legal limits.
The scope and content of the Bank's risk management system in terms of the main risk types are listed below. Bank's risk mitigation strategies and
processes for the assessment of their effectiveness are given in Fourth Section II No. "Explanations on Credit Risk" under the Section IV, XI-f.1 notes. No.
"The Public Disclosure of Qualitative Information Related to the Market Risk" mentioned in the section.
Credit risk
Credit risk is defined as the risk of the failure to comply with the requirements or failing to fulfill its obligations partially or totally of the counter side of the
transaction contract with the Bank. The methodology and responsibilities of the credit risk management, controlling and monitoring and the framework
of credit risk limitations specified with the credit risk policy.
The Bank defines measures and manages credit risk of the all products and activities. Board of Directors review the Bank’s credit risk policies and credit
risk strategy on an annual basis as a minimum. Top Management is responsible for the implementation of credit risk policies which are approved by
Board of Directors.
As a result of loans and credit risks analysis all findings are reported to Board of Directors and Top Management on a regular basis. In addition to
transaction and company-based credit risk assessment process, monitoring of credit risk also refers to an approach with monitoring and managing the
credit as a whole maturity, sector, security, geography, currency, credit type and credit rating.
In the Bank’s credit risk management, along the limits as required by legal regulations, the Bank utilizes the risk limits to undertake the maximum credit
risk within risk groups or sectors that the Board of Directors determines. These limits are determined such a way that prevents risk concentration on
particular sectors. In case of exceeding the limits, the excess and its reasons are immediately reported to the Risk Committee and Board of Directors. The
actions to be taken to remedy the excess and the time to eliminate the excess are concluded under the authority of the Board of Directors. The results of
the controls regarding the excess of the risk limits and the evaluations of these limits are presented by Internal Audit and Risk Management Group to Top
Management and Board of Directors.
The Bank uses credit decision support systems which are created for the purpose of credit risk management, lending decisions, controlling the credit
process and credit provisioning. The consistency of the credit decision support systems with the structure of the Bank’s activities, size and complexity
is examined continuously by internal systems. Credit decision support systems contain the Risk Committee assessment and approval of Board of
Directors.
Asset and Liability Management Risk
Asset-liability management risk defined as the risk of Bank’s incurring loss due to managing all financial risks that are inflicted from the Bank's assets,
liabilities and off-balance sheet transactions, ineffectively. Trading book portfolio’s market risk, structural interest rate risk and liquidity risk of the banking
portfolio; are considered within the scope of the asset liability management.
Complying the established risk limits and being at the limits that stipulated by the legislation are the primary priority of Asset-liability management risk.
Risk limits are determined by the Board of Directors by taking into consideration of the Group's liquidity, target income level and general expectations
about changes in risk factors.
Board of Directors and the Audit Committee are responsible for following the Bank's capital is used optimally; for this purpose, checking the status
against risk limits and providing the necessary actions are taken.
Asset and Liability Management Committee is responsible for managing the Asset and Liability risk within the framework of operating principles that are
involved in the risk appetite and risk limits are set by the Board of Directors in accordance with the policy statement.
Asset and liability management processes and compliance with the provisions of the policy are controlled and audited by the internal audit system. The
execution of the audit, reporting the audit results, action plans for the elimination of errors and gaps identified as a result of inspections regarding the
fulfillment of the principles, are determined by the Board of Directors.
Operational Risk
Operational risk is defined as “the possibility of loss resulting from inadequate or failed internal processes, people and systems, or from external
events, including legal risk”. Studies consisted of and are formed of occur by execution of identification, definition, measurement, analysis, monitoring
of operational risk, providing and reporting the necessary control related to monitoring the progress of our country and the world, the development of
techniques and methods, necessary legal reporting, notification and conduct of follow-up transactions. Studies on the subject are conducted by the
Department of Risk Management.
Operational risks that arise due to the activities are defined in "Bank Risk Catalogue" and classified in respect of species. Bank Risk Catalogue is kind of
the fundamental document that used for identification and classification of all at the risk that may be encountered. It is updated in line with the changes
in the nature of the processes and activities.
Qualitative and quantitative methods are used in a combination for measurement and evaluation of the operational risks. In this process, information use that
obtained from "Impact-Probability Analysis", "Missing Event Data Analysis", "Risk Indicators", “Scenario Analysis”, “Top-Down Risk Assessment”, “Internal
Model” methods. Methods prescribed by legal regulations are applied as minimum in determining the capital requirement level for the operating risk.
Operational Risk Committee that established by a decision of the board of directors on 30.04.2020, the management of operational risks that the bank
may be exposed for the determination of policies and strategies, the development of an operational risk management framework and operational risks
include activities with the aim of strengthening the governance model. The Committee works in cooperation with the Risk Committee and reports the
results of its activities to the Board of Directors through the Audit Committee.
All risks are assessed in the context of operational risk, loss events and the risk indicators same as operational risks that occurred in the Bank, are
monitored on a regular basis by the Department of Risk Management and reported periodically to the Risk Committee, Operational Risk Committee, and
the Board of Directors.
Model Risk Management and Validation Operations
Model risk is the risk of financial losses and/or loss of reputation that the Bank may be exposed to due to errors and/or malfunctions that occur during
the creation, implementation or use of models used in its activities. In order to address the model risk in a holistic manner, the model definition, model
life cycle and triple line of defense structure and the duties and responsibilities of all functions of the Bank in this structure are defined in the model risk
management policy.
Model risk management and validation activities in the second line of defense of the triple line of defense structure; creating the model inventory,
determining and approving the model class, validating the models, preparing periodic reports on the Bank's model risk and presenting those reports to
the Risk Committee, Audit Committee and Board of Directors.
Risk measurement models are validated at least once a year according to international standards. Within the scope of validation, activities are carried
out to test the performance and validity of models with statistical methods, to examine the quality of the data used in the model development phase and
the conceptual soundness of the selected methods, and to evaluate the health of the processes created for the use of the models. The results of the
validation activities are reported to the Risk Committee, Audit Committee and the Board of Directors.
a2. Overview of risk weighted amounts:
Risk Weighted Amounts
Minimum Capital Requirements
Current Period
Prior Period
Current Period
Credit risk (excluding counterparty credit risk) (CCR)
853,562,058
504,344,844
Of which standardized approach (SA)
853,562,058
504,344,844
Of which internal rating-based (IRB) approach
Counterparty credit risk
Of which standardised approach for counterparty credit risk
(CCR)
Of which internal model method (IMM)
Equity positions in banking book under basic risk weighting or
internal rating-based approach
14,270,649
14,329,919
14,270,649
14,329,919
Equity investments in funds – look-through approach
2,646,881
1,586,280
Equity investments in funds – mandate-based approach
Equity investments in funds – 1250% weighted risk approach
Settlement risk
21,438
Securitization positions in banking accounts
Of which IRB ratings-based approach (RBA)
Of which IRB Supervisory formula approach (SFA)
SA/simplified supervisory formula approach (SSFA)
Market risk
Of which standardised approach (SA)
Of which internal model approaches (IMM)
Operational Risk
Of which Basic Indicator Approach
Of which Standardised approach (SA)
Of which Advanced measurement approach
18,420,488
18,420,488
10,104,488
10,104,488
50,403,474
50,403,474
40,291,061
40,291,061
68,284,965
68,284,965
1,141,652
1,141,652
211,750
1,715
1,473,639
1,473,639
4,032,278
4,032,278
The amounts below the thresholds for deduction from capital
(subject to a 250% risk weight)
963,063
700,490
77,045
Floor adjustment
Total
940,288,051
571,357,082
75,223,044
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Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
b. Linkages between Financial Statements and Risk Amounts
b1 Differences and matching between asset and liabilities’ carrying values in financial statements and risk amounts in capital adequacy calculation
Carrying values of items in accordance with Turkish Accounting Standards
Carrying values of items in accordance with Turkish Accounting Standards
Current Period
Carrying
values in
financial
statements
prepared as
per TAS
Subject to
credit risk
Subject to
counterparty
credit risk
Securitization
Positions
Subject to
market risk
Not subject
to capital
requirements
or subject to
deduction from
capital
Prior Period
Carrying
values in
financial
statements
prepared as
per TAS
Subject to
credit risk
Subject to
counterparty
credit risk
Securitization
Positions
Subject to
market risk
Not subject
to capital
requirements
or subject to
deduction from
capital
Assets
Cash and CBRT
Banks and Money Market Placements
Financial Assets at Fair Value Through Profit/Loss
Financial Assets at Fair Value Through Other Comprehensive
Income
198,929,653
198,929,653
23,034,629
23,034,629
14,310,944
11,543,354
170,596,394
170,596,394
Derivative Financial Assets at Fair Value Through Profit/Loss
17,029,298
17,029,298
17,029,298
Derivative Financial Assets at Fair Value Through Other
Comprehensive Income
Financial Assets at Amortised Cost-Credit
782,423,321
782,423,321
Financial Assets at Amortised Cost-Other Financial Assets
93,373,997
93,373,997
Financial Assets at Amortised Cost-Expected Loss Provisions (-)
32,643,964
32,643,964
Assets Held for Sale and Discontinued Operations
1,600,625
1,600,625
Investment in Associates, Subsidiaries and Joint-Ventures
79,859,474
79,859,474
2,767,590
4,677,273
9,381,439
Tangible Assets
Intangible Assets
Investment Properties
Current Tax Asset
Deferred Tax Asset
Other Assets
Total Assets
Liabilities
Deposits
Funds Borrowed
Money Market Funds
Marketable Securities Issued
Derivative Financial Liabilities at Fair Value Through Profit/Loss
Derivative Financial Liabilities at Fair Value Through Other
Comprehensive Income
Leasing Transaction Liabilities
Provisions
Current Tax Liability
Deferred Tax Liability
Subortinated Debts
Other Liabilities
Shareholders' Equity
Total Liabilities
17,196,948
17,099,239
3,514,433
3,514,433
97,709
3,201,916
39,096,916
39,096,916
1,408,322,668 1,405,457,369 17,029,298
16,826,302
3,299,625
7,239,013
40,099,316
8,840,818
931,077,289
71,455,326
40,099,316
28,314,103
8,840,818
2,152,207
30,539,092
6,562,930
1,080,530
33,558,745
63,266,237
191,376,075
1,408,322,668
47,338,329
8,840,818
Assets
Cash and CBRT
Banks and Money Market Placements
Financial Assets at Fair Value Through Profit/Loss
181,923,221
181,923,221
24,129,301
24,129,301
10,572,208
9,441,624
Financial Assets at Fair Value Through Other Comprehensive Income
87,555,076
87,555,076
Derivative Financial Assets at Fair Value Through Profit/Loss
21,924,166
21,924,166
21,924,166
Derivative Financial Assets at Fair Value Through Other
Comprehensive Income
Financial Assets at Amortised Cost-Credit
514,208,750
514,208,750
Financial Assets at Amortised Cost-Other Financial Assets
46,412,734
46,412,734
Financial Assets at Amortised Cost-Expected Loss Provisions (-)
28,323,252
28,323,252
Assets Held for Sale and Discontinued Operations
827,633
827,633
Investment in Associates, Subsidiaries and Joint-Ventures
39,461,345
39,461,345
1,130,584
1,474,079
9,381,439
48,823
1,561,603
Tangible Assets
Intangible Assets
Investment Properties
Current Tax Asset
Deferred Tax Asset
Other Assets
Total Assets
Liabilities
Deposits
Funds Borrowed
Money Market Funds
Marketable Securities Issued
Derivative Financial Liabilities at Fair Value Through Profit/Loss
Derivative Financial Liabilities at Fair Value Through Other
Comprehensive Income
Leasing Transaction Liabilities
Provisions
Current Tax Liability
Deferred Tax Liability
Subortinated Debts
Other Liabilities
Shareholders' Equity
Total Liabilities
8,699,860
1,750,109
8,651,037
1,750,109
2,557,610
2,557,610
14,870,263
14,870,263
926,569,024
925,389,617
21,924,166
11,986,102
1,610,426
595,628,376
65,651,426
48,235,495
30,635,812
12,586,533
1,700,439
15,487,318
1,831,219
37,470,997
30,502,118
86,839,291
926,569,024
5,111,969
48,235,495
12,586,533
53,347,464
12,586,533
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256 İşbank 2022 Integrated Annual Report
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Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
b2. The main sources of the differences between the risk amounts and the amounts assessed in accordance with TAS in the financial statements
c.1.2. Credit quality of assets:
Current Period
Total
Credit Risk
Securitization
Positions
Counterparty
credit risk
Market risk
Asset carrying value amount under scope of TAS
1,408,322,668
1,405,457,369
Liabilities carrying value amount under scope of TAS
Total net amount scope of financial statement
1,408,322,668
1,405,457,369
885,372,448
158,493,495
1
2
3
4
5
6
7
8
9
10
11
Off-balance sheet amounts
Repo style transactions (*)
Differences in valuations
Differences due to different netting rules
Differences due to consideration of provisions
Differences due to prudential filters
Differences due to risk mitigation (**)
Risk Amounts
(166,370,491)
(32,532,563)
1,365,047,811
35,132,130
7,985,484
(*) According to the "Regulation on Measurement and Evaluation of Capital Adequacy of Banks", it is the counterparty credit risk amount calculated for repo style transactions.
(**) The source of the difference is collaterals of exposures to which credit risk mitigation is applied in the calculation of capital adequacy.
Prior Period
Total
Credit Risk
Securitization
Positions
Counterparty
credit risk
Market risk
17,029,298
16,826,302
(47,338,329)
8,840,818
64,367,627
7,985,484
23,771,654
11,360,476
21,924,166
11,986,102
(53,347,464)
12,586,533
75,271,630
600,431
26,056,873
4,488,558
1
2
3
4
5
6
7
8
9
10
11
Asset carrying value amount under scope of TAS
926,569,024
925,389,617
Liabilities carrying value amount under scope of TAS
Total net amount scope of financial statement
926,569,024
925,389,617
Off-balance sheet amounts
Repo style transactions (*)
Differences in valuations
Differences due to different netting rules
Differences due to consideration of provisions
Differences due to prudential filters
Differences due to risk mitigation (**)
Risk Amounts
670,197,753
139,078,854
(134,964,810)
(65,293,708)
864,209,953
Current Period
Loans
Debt Securities
Off-balance sheet
exposures
Total
Prior Period
Loans (*)
Debt Securities
Off-balance sheet
exposures
Total
Gross Carrying Calue in Financial Statements
Prepared in Accordance with Turkish Accounting
Standards (TAS)
Defaulted
Non-defaulted
Allowances/ amortization
and impairments
Net Values
23,134,130
1,990,915
759,289,191
269,306,646
453,484,304
17,207,112
1,616,688
765,216,209
269,306,646
453,858,531
25,125,045
1,482,080,141
18,823,800
1,488,381,386
Gross Carrying Calue in Financial Statements
Prepared in Accordance with Turkish Accounting
Standards (TAS)
Defaulted
Non-defaulted
Allowances/ amortization
and impairments
Net Values
20,830,559
1,606,025
493,378,191
138,938,624
323,100,912
13,790,995
1,214,355
500,417,755
138,938,624
323,492,582
22,436,584
955,417,727
15,005,350
962,848,961
(*) The credit balance, which is measured at fair value through profit and loss, as detailed in section five 1-B-3, is not included in the above table.
c.1.3. Changes in stock of default loans and debt securities (*):
Defaulted loans and debt securities at end of the previous reporting period
Loans and debt securities that have defaulted since the last reporting period
Receivables back to non-defaulted status
Amounts written off
Other changes
Defaulted loans and debt securities at end of the reporting period
Current Period
Prior Period
20,830,559
14,970,763
(497,130)
(4,977,165)
(7,192,897)
23,134,130
20,371,472
6,350,286
(1,017,053)
(2,006,458)
(2,867,688)
20,830,559
30,545,431
600,431
(*) Indemnified non-cash loans or non-cash loans not converted into cash, of the firms which are followed under “Non-performing Loans” accounts are not included in the table.
(*) According to the "Regulation on Measurement and Evaluation of Capital Adequacy of Banks", it is the counterparty credit risk amount calculated for repo style transactions.
c.1.4. Additional Explanation About the Credit Quality of Assets
(**) The source of the difference is collaterals of exposures to which credit risk mitigation is applied in the calculation of capital adequacy.
The Bank intends to use fair value measurement methods in accordance with TFRS 13 using valuation methodologies based primarily on observable
data. In this context, market prices, quoted prices, prices set by CBRT and published in official gazette and internal pricing models are also utilized in the
fair value measurement of the financial assets in the form of securities. Valuation models that use market data such as interest rates, efficiency curves,
currency, and volatility curves are used as the basis for derivative transactions while third party valuation services are also available.
The accuracy of the market prices, data and / or model inputs used in valuation under the independent price validation process is regularly checked and
the suitability of the results provided by the third-party pricing service is tested at regular intervals.
c. Explanation on Credit Risk
c.1. General Information on Credit Risk
c.1.1. General qualitative information on credit risk
This information is included in footnotes under Section Four, Note II "Explanations on Credit Risk," and Section Four, Note XI-a.1.
Bank’s methods for determining provision amounts and classification of its loans are mentioned in the Section Three Note VIII.
The bank is restructuring its loans classified as first and second group as well as non-performing loans and receivables. Restructuring in performing loans
are made by granting a new loan or extending the term date of credit given to customer by Bank. Restructuring of a contract is made on customer’s demand
or with the purpose of enhancing the solvency of customer. Restructuring in non-performing loans are generally made by establishing a new redemption
plan within the context of a protocol aiming the collection of those receivables whose redemption plan are not valid because of delinquency previously.
The breakdown of receivables in terms of geographic regions, sectors and remaining maturities are represented in “Explanations on Credit Risk” in the
Section Four Notes II.
On the basis of sector-based provisions for receivables are presented in the footnote numbered Section Four II-16. The amounts of the receivables that
are set aside for the geographical regions are as follows. The amount of non-performing loans which are written off in 2022 is TL 4,977,165.
Current Period
Prior Period
Non-Performing Loans
Specific Provision
Non-Performing Loans
Specific Provision
Domestic
EU Countries
OECD Countries (*)
Off-shore Banking Regions
USA, Canada
Other Countries
Total
22,683,339
230,924
37,019
10,098
172,750
23,134,130
16,846,075
154,985
31,646
8,182
166,224
17,207,112
20,397,941
247,369
35,901
7,731
141,617
13,498,359
119,892
30,765
6,382
135,597
20,830,559
13,790,995
(*) OECD countries other than the EU countries, USA and Canada
The aging analysis of past-due receivables is included in Section Four Note II-11
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Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
c.2. Credit risk mitigation
c.2.1. Qualitative Requirements to be Disclosed to The Public Regarding Credit Risk Mitigation Techniques
In the calculation of the Bank’s Credit Risk Mitigation in accordance with the “Communiqué on Credit Risk Mitigation Techniques” published in the
Official Gazette numbered 29111 on 6 September 2014, the financial collaterals are taken into consideration. The Bank takes local currency and foreign
currency deposit pledges into consideration as financial collaterals in calculating regulatory capital adequacy.
Information on key characteristics of the policies and processes related to the assessment and management of collateral are included in footnotes under
Section IV No. II, "Credit Risk Explanations".
c.2.2. Credit risk mitigation techniques:
Current Period
Exposures
unsecured
Exposures
secured by
collateral
Exposures
secured by
collateral,
of which:
secured
amount
Exposures
secured by
financial
guarantees
Exposures
Secured by
Financial
Guarantees,
of which:
Secured
Amount
Exposures
secured
by credit
derivatives
Exposures
secured
by credit
derivatives,
of which:
secured
amount
Loans
735,059,052
13,488,908
11,567,926
16,668,245
15,057,209
Debt securities
269,306,646
Total
1,004,365,698
13,488,908
11,567,926
16,668,245
15,057,209
Of which defaulted
23,134,130
Prior Period
Loans (*)
Debt securities
Total
Exposures
unsecured
Exposures
secured by
collateral
Exposures
secured by
collateral,
of which:
secured
amount
Exposures
secured by
financial
guarantees
Exposures
Secured by
Financial
Guarantees,
of which:
Secured
Amount
Exposures
secured
by credit
derivatives
Exposures
secured
by credit
derivatives,
of which:
secured
amount
577,741,977
10,355,755
8,618,981
10,746,384
9,724,012
153,871,817
731,613,794
10,355,755
8,618,981
10,746,384
9,724,012
Of which defaulted
23,623,595
(*) The credit balance, which is measured at fair value through profit and loss, as detailed in section five 1-B-3, is not included in the above table.
c.3. Credit risk if standard approach is used
c.3.1. Qualitative disclosures about the ratings notes used by banks to calculate credit risk by standard approach
The mentioned disclosure is presented in Section Four Note XI-a.1.
c.3.2. Standard approach - Exposure credit risk and credit risk mitigation effects
Current Period
Exposures before CCF
and CRM
Exposures post-CCF
and CRM
RWA and RWA density
On-balance
sheet amount
Off-balance
sheet
On-balance
sheet amount
Off-balance
sheet
On-balance
sheet amount
Off-balance
sheet
Exposures to sovereigns and their central banks
395,124,248
Exposures to regional and local governments
Exposures to administrative bodies and non-commercial entities
Exposures to multilateral development banks
Exposures to international organizations
Exposures to banks and securities firms
Exposures to corporates
Retail exposures
Exposures secured by residential property
Exposures secured by commercial property
Past-due loans
Exposures in higher-risk categories by the Board
Exposures in the form of bonds secured by mortgages
Short term exposures to banks, brokerage houses and corporates
Equity investments in the form of collective investment
undertakings
Equity investments
Other exposures
Total
Prior Period
Exposures to regional and local governments
Exposures to administrative bodies and non-commercial entities
Exposures to multilateral development banks
Exposures to international organizations
Exposures to banks and securities firms
Exposures to corporates
Retail exposures
Exposures secured by residential property
Exposures secured by commercial property
Past-due loans
Exposures in higher-risk categories by the Board
Exposures in the form of bonds secured by mortgages
Short term exposures to banks, brokerage houses and corporates
Equity investments in the form of collective investment
undertakings
Equity investments
Other exposures
Total
192,016
83,157
738,079
372
1,579
188,278
408,343,017
3,672,028
7,992,586
191,900
81,195
738,079
267
81,443
96,096
162,638
20,433,631
25,969,270
20,430,777
22,174,824
15,517,496
341,155,364
223,156,926
322,616,192
116,889,529
377,402,501
182,922,462
153,862,247
178,894,934
7,938,306
145,267,977
33,886,107
29,488,075
5,925,237
92,190,362
2,424,138
5,076,150
33,793,426
29,488,075
5,925,237
1,121,348
12,220,171
3,256,637
19,863,194
4,344,792
1,575,017
91,861,606
145,491
154,170,082
167.56%
2,611,881
35,000
2,611,881
35,000
2,646,881
100.00%
60,591,899
78,246,112
4,331,668
60,591,899
1,174,766
48,815,130
78,246,112
78,823,950
1,243,588,630
416,620,645
1,233,814,330
156,489,639
867,323,494
79.03%
100.74%
62.38%
Exposures before CCF
and CRM
Exposures post-CCF
and CRM
RWA and RWA density
On-balance
sheet amount
Off-balance
sheet
On-balance
sheet amount
Off-balance
sheet
On-balance
sheet amount
Off-balance
sheet
342,151
508,139
299,645
950
870
208,921
255,525,435
9,188,437
3,328,651
342,041
503,509
299,645
267
84,099
171,168
587,608
21,099,626
21,072,853
21,086,177
16,023,828
12,328,560
227,307,338
152,695,779
217,460,719
88,814,213
279,530,445
123,310,683
74,788,316
120,335,451
5,839,139
95,895,190
24,218,274
25,111,231
6,791,059
23,813,122
1,364,158
3,708,957
24,171,142
25,111,231
6,791,059
606,846
8,672,296
2,606,663
17,226,269
5,208,451
1,246,361
23,493,603
150,646
35,364,332
149,57%
1,536,280
50,000
1,536,280
50,000
1,586,280
100,00%
27,016,787
21,509,499
27,016,787
131,274
15,893,526
38,685,526
38,685,526
39,105,820
767,549,807
276,646,664
762,358,605
123,495,412
514,898,596
58,54%
101,09%
58,12%
1.94%
50.01%
100.00%
0.00%
36.42%
85.87%
77.75%
35.00%
60.66%
73.33%
1,26%
50,00%
100,00%
0,00%
33,22%
91,27%
76,00%
35,00%
62,15%
76,70%
Exposures to sovereigns and their central banks
247,509,946
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Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
c.3.3. Standardised Approach-Exposures by Risk Classes and Risk Weights:
0%
10%
20%
25%
35%
50%
Risk Weights
Bank
75%
100%
150%
250%
Other
Total
404,022,454
10
7,992,581
412,015,045
192,142
25
162,638
192,167
162,638
738,079
738,079
21,064,541
20,524,535
872,908
112,527
31,090
42,605,601
46,382,576
40,959,223
347,210,029
227,883
4,726,010
439,505,721
166,261,050
20,572,190
34,914,774
25,763,036
6,981,676
3,161,068
2,763,991
178
186,833,240
34,914,774
32,744,712
5,925,237
85,824
78,753 59,637,393
32,205,127
92,007,097
0%
10%
20%
25%
35%
50%
Risk Weights
Bank
75%
100%
150%
250%
Other
Total
261,385,207
29
3,328,636
264,713,872
342,280
28
587,608
342,308
587,608
299,645
299,645
22,305,274
13,781,596
958,860
11,190
53,085
37,110,005
18,541,595
23,259,559
264,041,919
95,804
336,055
306,274,932
121,117,602
5,056,988
24,777,988
20,983,251
6,734,643
3,166,861
3,622,553
1,645
126,174,590
24,777,988
27,717,894
6,791,059
53,944
96,195
23,494,110
23,644,249
Other exposures
12,865,658
Total
417,626,191
107,346
67,554,463
34,914,774 90,685,838 166,261,050 515,936,220 59,977,981 385,225 36,962,227 1,390,303,969
Total
272,939,387
40,846,869
24,777,988 61,587,520
121,117,602 340,312,566 23,602,749 280,196
389,140
885,854,017
2,646,881
77,860,887
48,793,661
385,225
2,646,881
78,246,112
61,766,665
Other exposures
11,254,535
1,586,280
38,405,330
15,893,526
280,196
1,586,280
38,685,526
27,148,061
Current Period
Risk Groups
Exposures to
sovereigns and
their central banks
Exposures to
regional and local
governments
Exposures to
administrative
bodies and
non-commercial
entities
Exposures to
multilateral
development
banks
Exposures to
international
organizations
Exposures
to banks and
securities firms
Exposures to
corporates
Retail exposures
Exposures
secured by
residential
property
Exposures
secured by
commercial
property
Past-due loans
Exposures in
higher-risk
categories by the
Board
Exposures in the
form of bonds
secured by
mortgages
Short term
exposures to
banks, brokerage
houses and
corporates
Equity
investments in the
form of collective
investment
undertakings
Equity
investments
Prior Period
Risk Groups
Exposures to
sovereigns and
their central banks
Exposures to
regional and local
governments
Exposures to
administrative
bodies and
non-commercial
entities
Exposures to
multilateral
development
banks
Exposures to
international
organizations
Exposures
to banks and
securities firms
Exposures to
corporates
Retail exposures
Exposures
secured by
residential
property
Exposures
secured by
commercial
property
Past-due loans
Exposures in
higher-risk
categories by the
Board
Exposures in the
form of bonds
secured by
mortgages
Short term
exposures to
banks, brokerage
houses and
corporates
Equity
investments in the
form of collective
investment
undertakings
Equity
investments
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Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
d. Explanations on Counterparty credit risk
d.1. Qualitative Explanations on Counterparty credit risk
The counterparty credit risk that the Bank is exposed to be managed within the framework of general limit allocation and credit risk mitigation that are
outlined in the Credit Risk Policy of the Bank. In setting general credit limits, the counterparty credit risks of customers as well as their cash and noncash
risks are taken into account with a holistic view. Moreover, the total position of the transactions which create counterparty credit risk is also monitored
under a separate risk limit.
The counterparty credit risk, which stems from derivatives and repo like transactions including transactions with qualified central counterparties that result in
liabilities for both sides, is measured according to the Appendix-2 and Appendix-4 of the "Regulation on Measurement and Evaluation of Capital Adequacy
of Banks" Counterparty credit risk valuation method based on the calculation of fair values of the derivative transactions is implemented. In the process
of calculating the counterparty credit risk, the Standard Approach is used to determine the risk amounts of derivative transactions. In calculating the risk
amount related to derivative transactions; 1.4 times the sum of potential credit risk amounts and positive replacement costs is charged.
Most of the credit risk related to the derivative transactions with other banks is subject to daily collateral clearing agreements mutually signed with
related parties and the counterparty credit risk is hence reduced. There are no guarantees received or sold by credit derivatives by the Bank in the
context of trading or banking accounts.
d.2. Counterparty credit risk (CCR) approach analysis:
Current Period
Replacement
Cost
Potential
Future
Exposure
EEPE (Effective
Expected
Positive
Exposure)
Alpha used
for computing
regulatory
EAD
Exposure
after
Credit Risk
Mitigation
Risk
Weighted
Amounts
Standardised Approach -CCR (for derivatives)
5,288,396 6,708,884
1,4
11,997,280
7,255,414
Internal Model Method (for repo transactions,
securities or commodity lending or borrowing
transactions, long settlement transactions and
securities financing transactions)
Simple Approach for credit risk mitigation (for
repo transactions, securities or commodity
lending or borrowing transactions, long
settlement transactions and securities
financing transactions)
Comprehensive Approach for credit risk
mitigation (for repo transactions, securities or
commodity lending or borrowing transactions,
long settlement transactions and securities
financing transactions)
Value-at-Risk (VaR) (for repo transactions,
securities or commodity lending or borrowing
transactions, long settlement transactions and
securities financing transactions)
Total
8,501,779
2,800,936
10,056,350
Current Period
Replacement
Cost
Potential
Future
Exposure
EEPE (Effective
Expected
Positive
Exposure)
Alpha used
for computing
regulatory
EAD
Exposure
after
Credit Risk
Mitigation
Risk
Weighted
Amounts
Standardised Approach -CCR (for derivatives)
15,126,470
2,525,157
1,4
17,651,627
7,438,966
Internal Model Method (for repo transactions,
securities or commodity lending or borrowing
transactions, long settlement transactions and
securities financing transactions)
Simple Approach for credit risk mitigation (for
repo transactions, securities or commodity
lending or borrowing transactions, long
settlement transactions and securities
financing transactions)
Comprehensive Approach for credit risk
mitigation (for repo transactions, securities or
commodity lending or borrowing transactions,
long settlement transactions and securities
financing transactions)
Value-at-Risk (VaR) (for repo transactions,
securities or commodity lending or borrowing
transactions, long settlement transactions and
securities financing transactions)
Total
3,603,297
820,234
8,259,200
d.3. Capital obligation for credit valuation adjustment (CVA):
Total portfolios subject to the Advanced CVA capital obligation
(i) VaR component (including the 3x multiplier)
(ii) Stressed VaR component (including the 3x multiplier)
All portfolios subject to the Standardised CVA capital obligation
Total subject to the CVA capital change
d.4. CCR exposures by risk class and risk weights:
Current Period
Prior Period
Risk Amounts
(Post CRM)
Risk Weighted
Amounts
Risk Amounts
(Post CRM)
Risk Weighted
Amounts
11,997,280
11,997,280
4,117,938
4,117,938
17,651,627
17,651,627
6,061,815
6,061,815
0%
10%
20%
50%
75%
100%
150%
Other
Risk Weights
3,625,929
17
1
4,663,983
5,474,983
289,620
217,221
6,196,119
31,186
Total Credit
Exposure (*)
3,625,929
17
10,138,967
6,702,960
31,186
4,757,100
4,757,100
Current Period
Risk Groups
Exposures to sovereigns and their
central banks
Exposures to regional and local
governments
Exposures to administrative bodies
and non-commercial entities
Exposures to multilateral
development banks
Exposures to international
organizations
Exposures to banks and securities
firms
Exposures to corporates
Retail exposures
Other Exposures
Total
3,625,929
4,953,603
5,692,204
31,186
6,196,137
4,757,100
25,256,159
(*) Other receivables: d.7. includes amounts reported in the table of risks to the central counterparty.
Prior Period
Risk Groups
Exposures to sovereigns and their
central banks
Exposures to regional and local
governments
Exposures to administrative bodies
and non-commercial entities
Exposures to multilateral
development banks
Exposures to international
organizations
Exposures to banks and securities
firms
Exposures to corporates
Retail exposures
Other Exposures
Total
0%
10%
20%
50%
75%
100%
150%
Other
Risk Weights
9,034,901
Total Credit
Exposure (*)
9,034,901
130
130
2,199,970
3,723,422
1
247,813
269,495
5,754,644
24,547
5,923,393
6,271,952
24,547
389,140
389,140
9,034,901
2,447,783
3,992,917
24,547
5,754,775
389,140
21,644,063
(*) Other receivables: d.7. includes amounts reported in the table of risks to the central counterparty.
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Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
d.5. Collateral for CCR:
Current Period
Received Collateral
Given Collateral
Collateral used in derivative transactions
Collateral used in other transactions
Segregated Unsegregated
Segregated Unsegregated
Received Collateral
Given Collateral
Cash- Domestic Currency
Cash- Other Currencies
Total
27,662,201
11,981,322
39,643,523
Prior Period
Received Collateral
Given Collateral
Collateral used in derivative transactions
Collateral used in other transactions
Segregated Unsegregated
Segregated Unsegregated
Received Collateral
Given Collateral
40,360,089
8,394,718
48,754,807
Current Period
Prior Period
Post CRM risk
exposure
RWA
Post CRM risk
exposure
RWA
4.757.100
4.746.787
96.361
95.142
94.936
389.140
387.118
8.904
7.782
7.742
10.313
206
2.022
40
100.538
146.312
39.347
1.219
40.614
1.122
Cash- Domestic Currency
Cash- Other Currencies
Total
d.6. Credit derivatives exposures:
None.
d.7. Exposures to central counterparties (CCP):
Exposure to Qualified Central Counterparties (QCCPs)
(total)
Exposures for trades at WCCPs (excluding initial margin and
default fund contributions); of which
(i) OTC Derivatives
(ii) Exchange-traded Derivatives
(iii) Repo-reverse repo transactions, credit securities
transactions and securities or commodities lending or borrowing
(iv) Netting sets where cross-product has been approved
Segregated initial margin
Non-segregated initial margin
Paid guarantee fund amount
Unpaid guarantee fund commitment
Exposures to non-QCCPs (total)
Exposures for trades at non-QCCPs (excluding initial margin and
default fund contributions); of which
(i) OTC Derivatives
(i) Exchange-traded Derivatives
(ii) Securities financing transactions
(iii) Netting sets where cross-product has been approved
Segregated initial margin
Non-segregated initial margin
Pre-funded default fund contributions
Unfunded default fund contributions
e. Explanations on securitizations:
None.
f. Market Risk Explanations
f.1. Qualitative information to be disclosed to the public regarding market risk:
Market risk is defined as the risk that may reduce the market value of the trading portfolio due to the changes in the risk factors named interest rate,
exchange rates, equities and the price of commodities and options.
The procedures for the management of market risk are discussed in the Bank's "Asset and Liability Management Risk Policy" and those procedures are
in line with the risk/return expectations of the Bank and with the limits that are defined in the risk appetite framework. Limits related to market risk; are
established by the Board and are revised periodically in order to reflect market conditions and best practices in the industry. Compliance to those limits
is closely monitored by the Risk Management Department, Asset and Liability Management Committee and by the executive departments. Additionally,
compliance with the provisions relating to the procedures and policies of market risk management is audited by the internal audit system.
Trading activities of the securities that are included in the calculation of market risk is carried out by taking the Asset-Liability Committee decisions, risk
policies and established limits into consideration and risks arising due to these activities are hedged using derivatives transactions where necessary.
Measurement of market risk, reporting of results, and monitoring compliance with the risk limits are among the key responsibilities of the Risk
Management Department. Analyses related to market risk are reported to the Risk Committee and to the Board via the Audit Committee by the Risk
Management Department.
The trading book of the Bank included in market risk calculations consists of on balance-sheet financial assets that are held for trading intent, derivatives
that provide hedge to those instruments and foreign currency positions. The market risk carried by the Bank is measured and monitored using two
methods known respectively as the Standard Method and the Value at Risk Model (VAR) and Expected Shortfall in accordance with the local regulations
which are established in compliance with the international legislations. In this context, the exchange rate risk emerges as the most important component
of the market risk.
The market risk calculations using the Standard Method are performed at the end of each month and the measurement results are included in the
statutory reports as well as being reported to the Bank’s top management.
The Value at Risk Model and Expected Shortfall are another alternative for the Standard Method used for measuring and monitoring market risk. This
model is used to measure the market risk on a daily basis in terms of interest rate risk, currency risk and equity share risk and is a part of the Bank’s daily
internal reporting. Further retrospective testing (back-testing) is carried out on a daily basis to determine the reliability of the daily risk calculation by the
VAR model, which is used to estimate the maximum possible loss for the following day.
Scenario analyses which support the VAR model used to measure the losses that may occur in the ordinary market conditions are practiced, and the
possible impacts of scenarios that are developed based on the future predictions and the past crises, on the value of the Bank’s portfolio are determined
and the results are reported to the Bank’s top management.
f.2. Standardised Approach:
Outright Products
Interest rate risk (general and specific)
Equity risk (general and specific)
Foreign exchange risk
Commodity risk
Options
Simplified approach
Delta-plus method
Scenario approach
Securitisations
Total
Current Period
Prior Period
RAT
17,794,076
4,996,400
997,925
9,123,063
2,676,688
626,412
626,412
9,118,589
3,798,288
464,125
4,265,063
591,113
985,899
985,899
18,420,488
10,104,488
g. Explanations on Operational Risk
The operational risk capital requirement is calculated according to Regulation on Measurement and Evaluation of Capital Adequacy of Banks' article
number 24, is measured using the Basic Indicator Approach once a year in parallel with domestic regulations. As of December 31, 2022, the operational
risk amount is TL 50,403,474 (December 31, 2020: TL 40,291,061) and information about the calculation is given below.
Current Period
2 PP Amount
1 PP Amount
CP Amount
Total/No.
of Years of
Positive Gross
Rate (%)
Total
Gross Income
19,200,037
27,720,464
33,725,058
3
15
4,032,278
Value at operational risk (Total*12.5)
50,403,474
Prior Period
2 PP Amount
1 PP Amount
CP Amount
Total/No.
of Years of
Positive Gross
Rate (%)
Total
Gross Income
17,545,195
19,200,037
27,720,464
3
15
3,223,285
Value at operational risk (Total*12.5)
40,291,061
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Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
h. The interest rate risk of the banking book items:
XII.
Explanations on Segment Reporting
Interest rate risk arising from the banking accounts is defined as negative effect risk on capital of the changes in market interest rates due to differences
in interest settlement and re-pricing on, differences in interest-earning assets taking part in the banking book; interest-bearing liabilities; interest-bearing
derivative transactions inclusive of the policies established by the Bank Board of Directors, is managed within the framework of the strategies set by
the Asset-Liability Management Committee. Compliance with internal risk limits for banking portfolio is closely and continuously monitored by the Risk
Management Department and Asset-Liability Committee and the measurement results are reported to the Board of Directors on a monthly basis.
Duration and sensitivity analysis are conducted on a monthly basis by the Bank in the scope of monitoring of interest rate risk arising from the banking
books about Interest Rate Risk in the Banking Accounts from the Regulation on Measurement and Assessment of Standard Shock Method which
is published in the Official Gazette No. 28034 dated 23 August 2011. In the duration analysis, the maturity gap between assets and liabilities of the
balance sheet are determined by the calculation of the weighted average maturities based on the asset that sensitive to interest rate and liabilities and
off-balance sheet transactions re-pricing period. In the interest rate risk sensitivity analysis, the influence of the various interest rate change scenarios to
the economic value of the Bank's capital is examined.
In the calculations made within the framework of the said regulation, behavioral maturity modeling is performed for demand deposits with low sensitivity
to interest changes and whose original maturity is longer than the contractual maturity. In these studies, which are defined as core deposit analysis,
based on historical data, calculations are made for what amount of demand deposits will remain within the bank for what maturity, and these analyzes
are used as an input in quantifying the interest rate risk arising from banking accounts in a way that does not contradict legal provisions.
Currency
Applied Shock (+/- x basis
point)
Revenue/ Loss
Revenue/Shareholders’ Equity –
Loss/ Shareholders’ Equity
TL
TL
EUR
EUR
USD
USD
Total (for Negative Shocks)
Total (for Positive Shocks)
i. Remuneration policy
(+) 500
(-) 400
(+) 200
(-) 200
(+) 200
(-) 200
(11,670,706)
10,850,819
1,455,039
(1,457,745)
(1,984,592)
3,182,748
12,575,822
(12,200,259)
(5.17) %
4.81%
0.64%
(0.65) %
(0.88) %
1.41%
5.57%
(5.41) %
The Remuneration Committee, which is established to carry out the duties and activities related to the monitoring and supervision of the Bank's
remuneration applications on behalf of the Board of Directors, consists of two members. The Remuneration Committee meets at least twice a year, not
exceeding six months, and reports to the Board of Directors on the results of the activities carried out and important matters considered to have an
impact on the Bank’s position. As of the end of 2022, the Remuneration Committee met 8 times and made a total of 12 decisions.
Regarding compliance with the Corporate Governance Principles, the Remuneration Committee monitors and supervises the practices related to
wage management on behalf of the Board of Directors; the fees are in line with the Bank's ethical values, internal balances and strategic objectives;
the evaluation of the remuneration policy and its practices in the context of risk management; it is responsible for the presentation of the proposals
determined in line with the requirements of the salary policy and the other responsibilities determined by the provisions of the applicable legislation and
the fulfillment of the duties given by the Board of Directors in this framework.
As of the end of 2022, the number of qualified employees working at the Bank is 29.
The monetary and social rights of employees are determined in accordance with the Chartering Policy in the framework of the legislation related to the
Collective Labor Agreement. The Bank carries out its practices with regard to remuneration policies within the framework of relevant banking and capital
market legislation. This policy includes all managers and employees.
Premium payments are made once a year to managers and managers who work in branches and headquarters units. It is considered that managerial
premium payments are in line with the Bank's long-term strategy and the risks assumed, as well as the performance of its employees. There are no
variable fees for qualified employees in the Bank.
The compliance of the wage levels in the bank with the sector wage levels is monitored by participating in independent and anonymous wage surveys,
which are held twice a year.
Within the scope of the remuneration policy, the Bank's pricing practices are planned and executed on the basis of effective risk management,
prevention of excessive risk taking, compliance with relevant legislation and scope and structure of the bank's activities, strategies, long-term objectives
and risk management structures.
The fees to be paid to the managers and employees of the Bank at every stage; It is essential that the Bank is in line with its ethical values, internal
balances and strategic objectives, and that it is not only associated with its short-term performance.
Payments made to employees are determined in a manner that will positively impact the Bank's corporate values and on the basis of objective
conditions.
Payments to be made to the managers of the units within the internal systems and to their staff are determined by taking into account the performance
of the relevant personnel in relation to their functions, as they are in the audit or oversight, or are independent of the performance of the activity unit they
control.
The Bank’s operations are classified as corporate, commercial, retail and private banking, and treasury/investment banking.
Services to the large corporations, SMEs and other trading companies are provided through various financial instruments within the scope of the
corporate and commercial operations. Services such as project financing, operating and investment loans, deposit and cash management, credit cards,
cheques and bills, foreign trade transactions and financing, letter of guarantees, letter of credits, forfeiting, foreign currency trading, bill collections,
payrolls, investment accounts, tax collections and other banking services are provided for the aforementioned customer segments.
Retail banking services are comprised of individuals needs such as deposits, consumer loans, overdraft accounts, credit cards, bill collections,
remittances, foreign currency trading, safe-deposit boxes, insurance, tax collections, and investment accounts and by other banking services. All kinds of
financing and cash management services provided to individuals in the high-income level are recognized as Private Banking activities.
Treasury transactions are comprised of medium- and long-term funding tools such as securities trading, money market transactions, spot and forward
TL and foreign currency trading, and derivative transactions such as forwards, swaps, futures and options, as well as syndications and securitizations.
The details about the aforementioned investments are stated in Note I.h-I.i of Section Five.
Statement of information related to business segmentation is given below. Below mentioned information has been prepared with the data obtained from
the Bank's management reporting system.
Current Period
Interest Income
Interest Expense
Fees and Commissions Income
Fees and Commissions Expense
Dividend Income
Trading Income/Loss (Net)
Other Income
Corporate/
Commercial
Banking
Individual/
Private
Banking
Treasury
Transaction/
Investment Activities
Unallocated
Total
61,873,126
15,005,791
15,296,004
20,174,307
16,206,784
5,145,861
3,189,166
503,115
40,835,759
12,441,592
38,604
4,522,593
108,479
571,561
123,454,753
4,597,133
329,019
4,623,986
2,279,788
48,251,300
20,770,884
4,623,986
38,604
4,522,593
6,080,548
Expected Credit Loss and Other Provision
Expenses
7,017,495
1,568,084
74,602
7,144,263
15,804,444
Other Operating Expense
5,198,926
13,410,401
15,419,951
34,029,278
Income/Loss from Investments in
Subsidiaries Accounted by Equity Method
21,790,674
21,790,674
73,949,048
12,411,168
61,537,880
Income Before Tax
Tax Provision
Net Period Profit
Total Assets
Total Liabilities
Prior Period
Interest Income
Interest Expense
Commission İncome
Commission Expense
Dividend Income
Trading Income/Loss (Net)
Other Income
Provision Expense
Other Expense
Income/Loss from Investments in
Subsidiaries Accounted by Equity Method
Income Before Tax
Tax Provision
Net Period Profit
Total Assets
Total Liabilities
588,020,459
157,068,287
398,204,736
265,029,186
1,408,322,668
403,518,032
484,887,253
182,268,308
337,649,075
1,408,322,668
Corporate/
Commercial
Banking
Individual/
Private
Banking
31,950,917
6,733,700
6,695,135
12,339,254
10,607,910
2,675,474
2,643,970
7,091,015
2,560,293
307,201
688,195
6,078,683
Treasury Transaction/
Investment Activities
Unallocated
Total
16,417,925
11,373,446
20,735
(5,149,127)
7,414
16,416
8,003,345
196,247
1,248,018
372,169
2,122,833
1,442,985
6,654,541
7,272,713
60,904,343
29,963,074
9,742,778
2,122,833
20,735
(5,149,127)
4,401,570
14,450,167
15,911,689
8,003,345
15,475,881
2,007,986
13,467,895
394,696,667
99,234,839
228,168,114
204,469,404
926,569,024
241,815,534
330,076,297
194,580,263
160,096,930
926,569,024
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268 İşbank 2022 Integrated Annual Report
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Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
SECTION FIVE: DISCLOSURES AND FOOTNOTES ON THE UNCONSOLIDATED FINANCIAL STATEMENTS
I.
a.
DISCLOSURES AND FOOTNOTES ON ASSETS
Cash and Central Bank of Turkey:
a.1. Cash and balances with the Central Bank of Turkey:
Cash in TL/Foreign Currency
Central Bank of Turkey
Other
Total
a.2. Information on balances with the Central Bank of Turkey:
Unrestricted Demand Deposit
Unrestricted Time Deposit
Restricted Time Deposit
Other (*)
Total
(*) The amount of reserve deposits held at the Central Bank of Turkey.
a.3. Information on reserve requirements:
Current Period
Prior Period
TL
FC
TL
FC
4,108,843
11,613,711
2,627,481
12,182,962
17,590,529
165,193,959
14,652,969
152,099,358
422,611
360,451
21,699,372
177,230,281
17,280,450
164,642,771
Current Period
Prior Period
TL
FC
TL
FC
17,590,529
45,894,722
14,652,969
66,674,939
7,453,446
111,845,791
85,424,419
d. Information on Banks:
ç.1. Information on Banks:
17,590,529
165,193,959
14,652,969
152,099,358
As per the Communiqué no. 2013/15 “Reserve Deposits” of the Central Bank of the Republic of Turkey (“CBRT”), banks keep reserve deposits at the
CBRT for their TL and FC liabilities mentioned in the communiqué. The reserve deposit rates vary according to their maturity compositions; the reserve
deposit rates are realized between 3% - 8% for TL deposits and other liabilities, between 19% - 26% for FC deposits and precious metal deposit
accounts and between 5% - 21% for other FC liabilities. Liabilities subject to required reserves are calculated and set aside every two weeks on Friday for
14-day periods.
According to the Communique on Required Reserves published in the Official Gazette dated 01.07.2021 and numbered 31528, the possibility of
establishing Turkish lira required reserves in foreign currency was terminated as of 01.10.2021.
Within the scope of the CBRT's Communiqué numbered 2021/14, additional required reserve and commission application for foreign currency
deposit accounts, effective as of 02.09.2022, according to the conversion rate into Turkish lira time deposit accounts; It has been terminated with the
Communiqué numbered 2022/30 published in the Official Gazette dated 31.12.2022 and numbered 32060 with the 5th repetition, effective from the
liability period dated 23.12.2022.
On the other hand, as of 23.12.2022, the commission rate to be calculated over the required reserve amount for foreign currency deposit liabilities; In
both real and legal person deposits, it is determined as 8% per annum for banks with a Turkish Lira deposit share below 50%, and 3% per annum for
banks with a 50% to 60% deposit share.
b.
Information on Financial Assets at Fair Value through Profit and Loss:
b.1. Financial Assets at fair value through profit and loss, which are given as collateral or blocked:
As of 31.12.2022, the amount of financial assets given as collateral/blocked at fair value through profit or loss is TL 8,712,789 (December 31, 2021:
4,010,802).
After the collection of the sales process, any special purpose entity that is the subject of the guarantee granted to the company which is under Financial
Assets at Fair Value Through Profit and Loss and the loan amounting to TL 3,920,571, for which impairment provision has been made, was classified as
non-performing loans as of 30.06.2022 and it was written off within the framework of the " Procedures and Principals regarding Classification of Loans
and Allowances Allocated for Such Loans ".
The shares in the amount of TL 526,236, which are tracked under “Impairment Losses on Assets Held for Sale and Subject to Discontinued Operations”
and were reserved for the entire decrease in value, were deleted from the asset together with the decrease in value provision within the scope of
registration of the liquidation of the company in the Türkiye Sicil Gazetesi dated 28.12.2022 and numbered 10735.
b.4. TL 2,039,931 of other financial assets consists of the mutual funds; Quasar İstanbul Konut Gayrimenkul and Quasar İstanbul Ticari Gayrimenkul
which were founded by İş Portföy Yönetimi A.Ş.
c.
Positive differences on derivative financial assets held for trading:
Derivative Financial Assets at Fair Value Through Profit or
Loss
Forward Transactions
Swap Transactions
Futures
Options
Other
Total
Current Period
Prior Period
TL
234,532
76,983
185,445
FC
689,844
14,415,860
180,079
1,246,555
TL
307,790
31,882
240,718
FC
1,697,249
18,159,836
456,221
1,030,470
496,960
16,532,338
580,390
21,343,776
Banks
Domestic Banks
Foreign Banks
Foreign Head Office and Branches
Total
d.2. Information on foreign banks:
EU Countries
USA, Canada
OECD Countries (*)
Off-shore Banking Regions
Other
Total
(*) OECD countries other than the EU countries, USA and Canada.
Current Period
Prior Period
TL
FC
TL
FC
72
415,341
118
628,822
650,302
21,968,914
168,103
23,332,258
650,374
22,384,255
168,221
23,961,080
Restricted Amount
Unrestricted Amount
Prior Period
Current Period
Prior Period
Önceki Dönem
6,042,205
2,147,862
3,400,101
6,992,733
4,798,843
3,164,571
1,229,286
2,504,313
977,040
1,732,111
4,120,368
3,083,978
15,710,536
18,040,125
4,702,354
6,908,680
1,223,812
5,460,236
b.2. Financial assets at fair value through profit and loss, which are subject to repurchase agreements::
Expected credit loss for cash and cash equivalents:
Financial assets at fair value through profit and loss, which are subject to repurchase agreements as of December 31, 2022, are amounting to TL 161,016
(December 31, 2021: TL 115,057).
b.3. All creditors including the Bank reached an agreement on restructuring the loans granted to the company. As stated in the year 2019, loans of
the company had been planning to be restructured based on required permits and necessary approvals within a new special purpose entity which was
already incorporated or will be incorporated in the Republic of Turkey and owned by the creditors either directly or indirectly through takeover of the
shares, that have been pledged by the company as a guarantee for the credit risk. Above mentioned process was completed in 2018 and, in this context
the Bank owns 11.5972% of the newly formed special purpose entity.
At the Ordinary Meeting of General Assembly of 2018 held in 2019, it has been decided to increase the share capital of the mentioned company by
TL 3,982,230, all to be covered by common receivables Whereas the Bank’s ownership ratio in company share have not changed, the nominal value
of the shares owned increased from TL 6 to TL 461,833 respectively. Related amount is under Assets Held for Sale and Discontinued Operations
account, while the loan amount remaining after the capital increase is followed under the Financial Assets at Fair Value Through Profit and Loss item on
10.03.2022, a share transfer agreement was signed between the company and TVF for the sale of all A group registered shares, corresponding to 55%
of the company's capital, to Türkiye Varlık Fonu (TVF) and on 31.03.2022, the sale and transfer transaction was realized.
Current Period
Stage 1
Stage 2
Stage 1
Stage 2
Prior Period
Stage 1
Stage 2
62,790
44,684
(3,349)
Beginning of period provisions
Additional provisions within the
period
Transfers within the period
Write-offs from Assets
Transfer to Stage 1
Transfer to Stage 2
Transfer to Stage 3
Currency Exchange Difference
Current Period Ending
Provisions
34,211
138,336
26,379
44,434
(18,484)
10,461
62,790
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270 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 271
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
e.
Information on Financial Assets at Fair Value through Other Comprehensive Income:
f.3. Information on Maturity analysis of cash loans
e.1. Information on financial assets at Fair Value through Other Comprehensive Income, which are given as collateral or blocked:
Financial assets at fair value through other comprehensive income, which are given as collateral or blocked, amount to TL 57,585,824 as of December
31, 2022 (December 31, 2021: TL 21,372,033).
e.2. Information on financial assets at Fair Value Through Other Comprehensive Income, which are subject to repurchase agreements:
Financial assets at fair value through other comprehensive income, which are subject to repurchase agreements amount to TL 39,650,302 as of
December 31, 2022 (December 31, 2021: TL 32,267,910).
e.3. Information on financial assets at Fair Value through Other Comprehensive Income:
Cash Loans
Short-term Loans and Other Receivables
Medium and Long-term Loans and Other Receivables
Standard
Loans
309,589,401
379,744,863
Loans under close monitoring
Restructured Loans
6,155,109
19,573,727
2,963,197
41,262,894
Debt Securities
Quoted on a Stock Exchange
Not- Quoted (*)
Share Certificates
Quoted on a Stock Exchange
Not-Quoted
Impairment Losses (-)
Other
Total
Current Period
Prior Period
f.4. Information on consumer loans, retail credit cards, personnel loans and personnel credit cards:
175,252,541
55,488,052
119,764,489
1,096,053
1,096,053
5,752,200
170,596,394
92,072,307
47,467,263
44,605,044
552,328
552,328
5,094,482
24,923
87,555,076
Consumer Loans – TL
Real Estate Loans
Vehicle Loans
General Purpose Consumer Loans
Other
Consumer Loans – FC Indexed
Real Estate Loans
Vehicle Loans
Short-Term
Medium and Long
Term
Interest and Income
Accruals
Total
9,476,653
52,801
66,714
9,357,138
100,970,141
28,685,188
3,837,024
68,447,929
1,829
1,829
1,704,011
354,540
44,964
1,304,507
20,024
20,024
112,150,805
29,092,529
3,948,702
79,109,574
21,853
21,853
(*) Refers to the debt securities, which are not quoted on the Stock Exchange, or which are not traded, although quoted, on the Stock Exchange at the end of the related period.
General Purpose Consumer Loans
f.
Information related to loans:
f.1. Information on all types of loans and advances given to shareholders and employees of the Bank:
Current Period
Prior Period
Cash
Non-Cash
Cash
Non-Cash
Direct Lending to Shareholders
Corporate Shareholders
Individual Shareholders
Indirect Lending to Shareholders
Loans and Other Receivables to Employees
Total
586,440
586,440
967
967
353,655
353,655
861
861
f.2. Information about the Standard loans and loans under close monitoring and loans under close monitoring that have been restructured:
Cash Loans
Standard Loans
Loans Under Close Monitoring
Loans Not
Subject to
Restructuring
Restructured Loans
Loans with
Revised Contract
Terms
Refinance
Non-specialized loans
Corporation Loans
Export Loans
Import Loans
Loans Extended to Financial Sector
Consumer Loans
Credit Cards
Other
Specialized Loans
Other Receivables
Total
12 Month Expected Credit Losses (Stage I)
Significant Increase in Credit Risk (Stage II)
689,334,264
240,747,331
100,660,779
34,468,286
106,364,392
84,734,146
122,359,330
25,728,836
11,083,712
596,604
1,779
9,719,209
2,849,769
1,477,763
23,359,939
16,721,005
48,627
20,866,152
10,938,206
1,042,531
1,091,940
5,498,367
2,134,800
6,750,615
689,334,264
25,728,836
23,359,939
20,866,152
Current Period
Prior Period
Standard Loans
Loans Under
Close Monitoring
Standard Loans
Loans Under
Close Monitoring
3,676,271
3,417,459
11,705,636
11,094,455
Other
Consumer Loans – FC
Real Estate Loans
Vehicle Loans
General Purpose Consumer Loans
Other
Retail Credit Cards – TL
With Installments
Without Installments
Retail Credit Cards – FC
With Installments
Without Installments
Personnel Loans-TL
Real Estate Loans
Vehicle Loans
General Purpose Consumer Loans
Other
Personnel Loans- FC Indexed
Real Estate Loans
Vehicle Loans
General Purpose Consumer Loans
Other
Personnel Loans – FC
Real Estate Loans
Vehicle Loans
General Purpose Consumer Loans
Other
Personnel Credit Cards – TL
With Installments
Without Installments
Personnel Credit Cards-FC
With Installments
Without Installments
Overdraft Accounts – TL (real persons)
Overdraft Accounts – FC (real persons)
2,831,098
2,831,098
165,403
7,854
2,693
154,856
7,202
7,202
54,909,240
24,789,032
30,120,208
141,814
141,814
35,634
515
35,119
311,164
148,532
162,632
1,684
1,684
5,785,122
245,890
62,206
183,684
4,708
164
43
4,501
57,986,228
27,682,336
30,303,892
141,814
141,814
205,745
8,018
3,251
194,476
423
423
54,876
318,789
155,734
163,055
1,684
1,684
5,839,998
Total
70,661,311
103,975,673
2,029,932
176,666,916
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272 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 273
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
f.5. Information on commercial installments loans and corporate credit cards:
f.10.2. Information on the movement of total non-performing loans
Commercial Loans with Installments-TL
Real Estate Loans
Vehicle Loans
General Purpose Commercial Loans
Other
Commercial Loans with Installments-FC Indexed
Real Estate Loans
Vehicle Loans
General Purpose Commercial Loans
Other
Short-Term
Medium and Long
Term
Interest and Income
Accruals
Total
24,126,058
13,434
3,645,983
20,466,641
73,604,896
3,668,187
24,329,585
45,607,124
85,235
1,779
83,456
1,429,058
35,344
281,916
1,111,798
359,634
7,153
352,481
99,160,012
3,716,965
28,257,484
67,185,563
444,869
8,932
435,937
Commercial Loans with Installments-FC
82,158
5,339,350
65,756
5,487,264
Real Estate Loans
Vehicle Loans
General Purpose Commercial Loans
Other
Corporate Credit Cards-TL
With Installments
Without Installments
Corporate Credit Cards-FC
With Installments
Without Installments
Overdraft Accounts – TL (corporate)
Overdraft Accounts – FC (corporate)
Total
f.6. Allocation of loan by borrowers:
Public
Private
Total
f.7. Domestic and foreign loans:
Domestic Loans
Foreign Loans
Total
82,158
5,339,350
934,252
934,166
86
29,224,515
15,768,852
13,455,663
19,448
19,448
3,233,583
65,756
49,125
49,125
46,826
5,487,264
30,207,892
16,703,018
13,504,874
19,448
19,448
3,280,409
56,685,762
79,963,733
1,950,399
138,599,894
Current Period
Prior Period
6,639,607
752,649,584
759,289,191
Current Period
Prior Period
736,260,169
23,029,022
759,289,191
Current Period
Prior Period
6,082,101
487,296,090
493,378,191
474,816,677
18,561,514
493,378,191
6,287,638
6,287,638
f.8. Loans granted to subsidiaries and associates:
Direct Loans Granted to Subsidiaries and Associates
Indirect Loans Granted to Subsidiaries and Associates
Total
f.9. Information on impairment provisions of Loans (Stage 3):
Loans with Limited Collectability
Loans with Doubtful Collectability
Uncollectible Loans
Total
Current Period
13,925,479
13,925,479
1,229,326
2,353,691
13,624,095
17,207,112
Prior Period
848,210
1,160,409
11,782,376
13,790,995
f.10. Information on non-performing loans (Net):
f.10.1. Information on non-performing loans, which are restructured or rescheduled:
Current Period
(Gross amounts before the provisions)
Restructured Loans
Prior Period
(Gross amounts before the provisions)
Restructured Loans
Group III
Loans with Limited
Collectability
Group IV
Loans with Doubtful
Collectability
Group V
Uncollectible Loans
1,199,485
1,199,485
118,515
118,515
135,860
135,860
54,316
54,316
6,148,323
6,148,323
3,333,401
3,333,401
Prior Period Ending Balance
Corporate and Commercial Loans
Retail Loans
Credit Cards
Other
Additions (+)
Corporate and Commercial Loans
Retail Loans
Credit Cards
Other
Transfers from Other NPL Categories (+)
Corporate and Commercial Loans
Retail Loans
Credit Cards
Other
Transfers to Other NPL Categories (-)
Corporate and Commercial Loans
Retail Loans
Credit Cards
Other
Collections (-) (*)
Corporate and Commercial Loans
Retail Loans
Credit Cards
Other
Write-Offs (-)
Corporate and Commercial Loans
Retail Loans
Credit Cards
Other
Debt Sale (-) (**)
Corporate and Commercial Loans
Retail Loans
Credit Cards
Other
Currency Change Effect
Corporate and Commercial Loans
Retail Loans
Credit Cards
Other
Current Period Ending Balance
Corporate and Commercial Loans
Retail Loans
Credit Cards
Other
Provisions (-)
Corporate and Commercial Loans
Retail Loans
Credit Cards
Other
Net Balance on Balance Sheet
Group III
Loans with Limited
Collectability
Group IV
Group V
Loans with Doubtful
Zarar Niteliğindeki Krediler
1,667,147
1,104,265
352,879
210,003
10,698,709
6,793,006
2,742,183
1,163,313
207
7,574,289
4,821,470
1,962,973
789,639
207
2,269,208
1,344,640
576,850
347,718
521
179
309
33
358
180
178
2,522,196
1,731,162
555,108
235,926
1,229,326
798,652
295,309
135,365
1,292,870
2,187,877
1,748,895
277,752
161,230
222,192
192,631
20,710
8,798
53
7,574,289
4,821,470
1,962,973
789,639
207
4,363,593
2,910,462
998,995
453,876
260
935,582
368,864
372,775
193,943
559
205
301
53
31
31
272
137
135
4,684,865
3,483,602
889,499
311,764
2,353,691
1,644,939
514,135
194,617
2,331,174
16,975,535
15,745,438
668,497
436,120
125,480
4,049,862
4,023,541
4,161
2,350
19,810
4,363,593
2,910,462
998,995
453,876
260
4,971,531
4,527,394
301,815
137,960
4,362
4,612,111
4,529,659
2,352
6,308
73,792
363,943
122,715
139,108
92,557
9,563
485,664
484,274
1,331
59
15,927,069
13,983,947
1,229,709
655,521
57,892
13,624,095
12,092,033
924,637
559,071
48,354
2,302,974
(*) As of 31 December 2022, the amount of 4,604,476 TL has been deducted within the framework of the amendment made in the "Regulation on the Procedures and Principles
Regarding the Classification of Loans and Provisions for These" published in the Official Gazette dated 27 November 2019 and numbered 30961. Details of which are given in
Note I.b.3 of Section Five, the loan amounting to TL 4.475.966, which is followed in financial assets at fair value through profit or loss classified as non-performing loans in the
current period and has been written off.
(**) In the current period, the part of the receivables constitutes non-performing loans amounting to TL 363,974 are transferred to Emir Varlık Yönetim A.Ş. and İstanbul Varlık
Yönetim A.Ş by collecting TL 76,500 of sales amount in cash.
After the sale of non-performing loans and the write-off, the Banks’s non-performing loan ratio decreased from 3.57% to 2.96% as of 31.12.2022.
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274 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 275
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
f.10.3. Information on foreign currency non-performing loans:
Current Period
Balance at the End of the Period
Provisions (-)
Net Balance on Balance Sheet (*)
Prior Period
Balance at the End of the Period
Provisions (-)
Net Balance on Balance Sheet (*)
Group III
Loans with Limited
Collectability
Group IV
Loans with Doubtful
Collectability
Group V
Uncollectible Loans
1,292,736
598,592
694,144
602,138
291,909
310,229
3,127,450
1,465,512
1,661,938
1,070,131
545,376
524,755
9,872,746
8,569,151
1,303,595
10,547,942
6,459,390
4,088,552
(*) In addition to the loans extended in foreign currency, loans which are monitored in Turkish Lira are included.
f.10.4. Information on gross and net non-performing loans as per customer categories:
Group III
Loans with Limited
Collectability
Group IV
Loans with Doubtful
Collectability
Group V
Uncollectible Loans
Current Period (Net)
Loans to Individuals and Corporate (Gross)
Provisions (-)
Loans to Individuals and Corporate (Net)
Banks (Gross)
Provisions (-)
Banks (Net)
Other Loans (Gross)
Provisions (-)
Other Loans (Net)
Prior Period (Net)
Loans to Individuals and Corporate (Gross)
Provisions (-)
Loans to Individuals and Corporate (Net)
Banks (Gross)
Provisions (-)
Banks (Net)
Other Loans (Gross)
Provisions (-)
Other Loans (Net)
1,292,870
2,522,196
1,229,326
1,292,870
818,937
1,667,147
848,210
818,937
2,331,174
4,684,865
2,353,691
2,331,174
1,027,468
2,187,877
1,160,409
1,027,468
2,302,974
15,869,177
13,575,741
2,293,436
57,892
48,354
9,538
5,193,159
16,850,055
11,667,521
5,182,534
125,480
114,855
10,625
f.10.5. Information on interest accruals, valuation differences and related provisions calculated for non-performing loans:
Current Period (Net)
Interest accruals and valuation differences
Provisions (-)
Prior Period (Net)
Interest accruals and valuation differences
Provisions (-)
Group III
Loans with Limited
Collectability
Group IV
Loans with Doubtful
Collectability
Group V
Uncollectible Loans
80,448
157,503
77,055
103,070
205,266
102,196
330,000
644,931
314,931
136,063
282,220
146,157
251,521
1,483,646
1,232,125
379,597
1,460,295
1,080,698
f.10.6. Outline of the liquidation policy for uncollectible loans and other receivables
In order to ensure the liquidation of non-performing loans, all possibilities evaluated to ensure maximum collection according to the legislation. Primarily,
administrative initiatives are taken to deal with the borrower. Collection through legal proceedings is applied if there is no possibility of collection,
liquidation or structuring for receivables through negotiations.
Our receivables that cannot be collected through administrative and legal initiatives can be written off from the assets within the framework of portfolio-
based receivables sales or write-offs, by fulfilling the requirements of the Tax Procedure Law.
f.10.7.
Information on write-off policy
Receivables classified as non-performing loans are collected primarily within the framework of administrative contacts with the debtors, and if no result
is obtained, legal proceedings are applied. In case of deletion of NPLs from assets, one of the methods of destruction, receivable sale and write-off can
be applied.
In the Bank's write-off policy within the framework following the amendment made in Article 53 of the Banking Law with the Law on Income Tax
and amending Certain Laws No. 19.07.2019/7186, along with the "Classification of Loans and the Procedures and Principles for the Reserves to be
Allocated" published in the Official Gazette No. 27.11.2019 / 30961, the following statements are issued:
ੵ The portion of the receivables, which are followed under the Fifth Group-Loans with a Loss Qualification and for which a lifetime expected credit loss
provision has been made due to the default of the debtor, for which there is no reasonable expectation of its collection, can be write-off to the extent of
the maximum provision amount,
ੵ write-off is an accounting practice and does not result in the remission of the receivable,
Receivables that are proven to be uncollectible in legal follow-up process can be write-off within the instructions of Tax Procedure Law.
Expected Credit Loss
Current Period
Stage 1
Stage 2
Stage 3
Stage 1
Prior Period
Stage 2
Provisions beginning of the period
3,417,459
11,094,455
13,790,995
Additional provisions within the period
2,594,541
4,207,497
9,560,435
2,566,751
2,018,263
7,809,169
6,148,847
Transfers within the period
(2,622,121)
(2,149,836)
(2,558,495)
(1,359,941)
(1,799,663)
Write-offs from Assets
Transfer to Stage 1
Transfer to Stage 2
Transfer to Stage 3
477,898
(173,497)
(466,158)
187,085
(4,976,818)
(11,740)
(13,588)
(46,578)
(1,358,108)
1,404,686
Currency Exchange Difference
28,569
190,701
11,637
473,529
(361,801)
(21,047)
101,705
(466,441)
368,343
(1,212,754)
246,954
Stage 3
12,975,961
3,049,611
(1,468,889)
(1,998,407)
(7,088)
(6,542)
1,233,801
12,548
Provisions at the end of the period
3,676,271
11,705,636
17,207,112
3,417,459
11,094,455
13,790,995
g. Financial Assets Measured at Amortised Cost:
g.1. Financial Assets Measured at Amortised Cost given as collateral or blocked:
Financial assets measured at amortised cost given as collateral or blocked amount to TL 58,013,328 as of December 31, 2022 (December 31, 2021: TL
9,520,594).
g.2.
Financial Assets Measured at Amortised Cost subject to repurchase agreements:
Financial assets measured at amortised cost, which are subject to repurchase agreements amount to TL 4,989,769 as of December 31, 2022
(December 31, 2021: TL 17,843,004).
g.3.
Information on government securities measured at amortised cost:
Government Bonds
Treasury Bills
Other Public Debt Securities
Total
Current Period
Prior Period
87,040,233
43,662,356
87,040,233
43,662,356
g.4. Information on financial assets measured at amortised cost:
Debt Securities
Quoted on a Stock Exchange
Not Quoted (*)
Impairment Losses (-)
Total
Current Period
93,373,997
90,007,186
3,366,811
Prior Period
46,412,734
44,951,778
1,460,956
93,373,997
46,412,734
(*) Indicates unlisted debt securities, and debt securities that have not been traded at the end of the related periods while they are listed
g.5. Movement of financial assets measured at amortised cost within the year:
Current Period
Prior Period
Beginning Balance
Foreign Exchange Differences Arising on Monetary
Assets
Purchases During the Year
Disposals through Sales and Redemption
Impairment Losses (-)
Valuation effect
Balance at the End of the Period
46,412,734
2,181,993
55,070,273
(19,171,942)
8,880,939
93,373,997
41,659,437
2,747,218
15,700,230
(15,819,174)
2,125,023
46,412,734
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen
276 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 277
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Expected credit loss for financial assets measured at amortised cost
Current Period
Prior Period
Stage 1
Stage 2
Stage 1
Stage 1
Stage 2
Stage 2
Beginning Term Provision
Additional Provisions During the Period
Disposal During the Period
20,343
53,189
(18,655)
Write-off
Transfer to Stage 1
Transfer to Stage 2
Transfer to Stage 3
Exchange Rate Differences
Period-end Provisions
h.
Information on associates (Net):
h.1. General information on associates:
68
54,945
12,001
18,508
(10,266)
100
20,343
No.
Title
Address (City/ Country)
Bank’s Share Percentage-
If Different, Voting
Percentage (%)
Bank’s Risk Group Share
Percentage (%)
1-
2-
Arap Türk Bankası A.Ş.
Kredi Kayıt Bürosu A.Ş.
İstanbul/TURKEY
İstanbul/TURKEY
20.58
9.09
20.58
9.09
h.2. Information on financial statements of associates in the above order (*):
No.
Total Assets
Shareholders’
Equity
Total Tangible
Assets
Interest
Income (**)
Securities
Income
Current Period
Profit/Loss
Prior Period
Profit/Loss
Fair Value
1-
2-
12,228,874
766,973
1,872,216
155,774
584,891
323,951
708,973
25,990
63
1,247
215,338
29,975
163,288
19,581
(*) Shows September 30, 2022, amounts for Kredi Kayıt Bürosu A.Ş. and December 31, 2022, amounts for Arap Türk Bankası A.Ş
h.5.
h.6.
h.7.
Associates quoted on a stock exchange: None.
Associates disposed of in the current period: None.
Associates acquired in the current period: None.
i.
Information on subsidiaries (Net):
i.1. Information on the equity of major subsidiaries:
Türkiye Sınai
Kalkınma
Bankası A.Ş.
İş Gayrimenkul
Yatırım
Ortaklığı A.Ş.
Sigorta /
Reasürans
Şirketleri
İş Finansal
Kiralama A.Ş.
İş Yatırım
Menkul
Değerler A.Ş.
İşbank AG
COMMON EQUITY TIER I CAPITAL
Common Equity Tier I Capital Before
Deductions
Deductions from Common Equity Tier
I Capital (-)
Total Common Equity Tier I Capital
ADDITIONAL TIER I CAPITAL
Additional Tier I Capital before
Deductions
Deductions from Additional Tier I
Capital (-)
Total Tier I Capital
TIER II CAPITAL
Tier II Capital Before Deductions
Deduction from Tier II Capital (-)
Total Tier II Capital
Total Tier I Capital and Tier II
Capital
Total Tier I Capital and Tier II Capital
EQUITY
i.2. General information on subsidiaries (*):
13,192,070
13,925,551
8,504,127
3,432,832
6,815,919
7,526,750
497,007
7,969
119,940
16,363
111,128
160,365
12,695,063
13,917,582
8,384,187
3,416,469
6,704,791
7,366,385
12,695,063
13,917,582
8,384,187
3,416,469
6,704,791
7,366,385
4,587,995
4,587,995
17,283,058
13,917,582
8,384,187
3,416,469
6,704,791
7,366,385
17,283,058
13,917,582
8,384,187
3,416,469
6,704,791
7,366,385
Title
Address (City/ Country)
Bank’s Share
Percentage-if Different,
Voting Rights (%)
Bank’s Risk Group
Share Percentage (%)
(**) Includes interest income on securities.
h.3. Movement of investments in associates:
Beginning Balance
Movements During the Period
Purchases
Bonus Shares Acquired
Dividends Received from Current Year Profit
Sales
Revaluation Increase (*)
Impairment
Other
Balance at the end of the period
Capital commitments
Contribution in equity at the end of the period (%)
Banks
Insurance Companies
Factoring Companies
Leasing Companies
Finance Companies
Other Financial Participations
Total
Current Period
Prior Period
311,081
266,305
88,301
44,776
399,382
311,081
No
1-
2-
3-
4-
5-
6-
7-
8-
9-
Anadolu Hayat Emeklilik A.Ş.
Joint Stock Company İsbank
Join Stock Company Isbank Georgia
İş Finansal Kiralama A.Ş.
İş Gayrimenkul Yatırım Ortaklığı A.Ş.
İş Merkezleri Yönetim ve İşletim A.Ş.
İş Net Elektronik Bilgi Üretim Dağıtım Ticaret ve İletişim
Hizmetleri A.Ş.
İş Yatırım Menkul Değerler A.Ş.
İşbank AG
(*) The differences arising from accounting by equity method is included.
h.4. Sectoral information on financial associates and the related carrying amounts:
Associates
Current Period
Prior Period
10- Kültür Yayınları İş Türk A.Ş.
11- Milli Reasürans T.A.Ş.
12- Trakya Yatırım Holding A.Ş.
13- Türkiye Sınai Kalkınma Bankası A.Ş.
14- Türkiye Şişe ve Cam Fabrikaları A.Ş.(*)
385,225
280,196
15- MOKA Ödeme ve Elektronik Para Kuruluşu A.Ş.
Istanbul/TURKEY
Moscow/RUSSIA
Tbilisi/GEORGIA
Istanbul/TURKEY
Istanbul/TURKEY
Istanbul/TURKEY
Istanbul/TURKEY
Istanbul/TURKEY
Frankfurt-Main/GERMANY
Istanbul/TURKEY
Istanbul/TURKEY
Istanbul/TURKEY
Istanbul/TURKEY
Istanbul/TURKEY
Istanbul/TURKEY
62.00
100.00
100.00
27.79
52.06
86.33
100.00
65.74
100.00
100.00
87.60
100.00
47.68
50.93
100.00
83.00
100.00
100.00
58.24
64.84
100.00
100.00
70.78
100.00
100.00
87.60
100.00
51.37
57.02
100.00
385,225
280,196
(*) The purchased free float shares of listed subsidiaries in Borsa Istanbul (BIST) namely, Anadolu Hayat Emeklilik A.Ş., İş Finansal Kiralama A.Ş, and Türkiye Şişe ve Cam
Fabrikaları A.Ş., which are booked under "Financial Assets at Fair Value Through Profit or Loss" account are not included. (Board of Directors Decision dated December 25, 2015).
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen
278 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 279
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
i.3. Information on subsidiaries (Net):
No
Total Assets
Shareholders’
Equity
90,659,179
3,466,207
4,525,552
1,633,192
2,917,655
828,210
36,330,079
3,744,045
Total
Tangible
Assets
215,301
100,257
57,507
60,515
17,417,219
13,920,236
13,959,708
173,511
248,448
96,048
114,602
35,809,603
7,267,688
33,318,257
7,920,657
151,817
115,324
9,922
40,380
206,268
346,362
9,690
12,400,448
5,055,936
2,449,885
1,660,198
1,158,868
689,914
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
Interest
Income
Securities
Income
Current
Period
Profit/Loss
Prior Period
Profit/Loss
Fair Value
(**)
1,038,678
513,911
1,391,752
699,988
9,848,720
Additional
Shareholders’
Equity
Required
408,306
166,509
3,330,338
44,469
6,180
14,383
76,171
878,024
2,525
518,181
13,601
19,602
277,409
24
478,226
82,366
826,766
12,739
28,165
310,063
5,605,530
44,469
1,329,920
10,286,429
21,162
24,512
15,618
15,532
1,756,373
4,529,607
1,233,477
22,215,545
323,549
33,587
888,620
80,201
143,158
26,174
548,966
29,067
4,105,739
1,097,309
12,280,800
222,160
40,666
110,483
117,621,660
12,992,456
1,983,415
10,374,234
163,945,473
95,127,767
81,459,869
2,240,410
1,166,759
20,133,429
9,131,288 132,854,654
468,170
46,570
6,047
4,024
2,351
2,143
(*) Trakya Yatırım Holding A.Ş., İş Merkezleri Yönetim ve İşletim A.Ş., İş Net Elektronik Bilgi Üretim Dağıtım Ticaret ve İletişim Hizmetleri A.Ş., Kültür Yayınları İş Türk A.Ş. are
December 31, 2021, and others are December 31, 2022.
(**) Fair value represents the market value of the company.
i.4. Movement of investments in subsidiaries:
Balance at the Beginning of the Period
39,150,264
25,736,078
Current Period
Prior Period
Movements in the Period
Purchases (*)
Bonus Shares Acquired
Dividends Received from Current Year Profit
Sales
Revaluation Surplus/Deficit (**)
Impairment
Balance at the End of the Period
Capital Commitments (***)
Contribution in equity at the end of the period (%)
3,714,714
135,635
36,595,114
13,278,551
79,460,092
39,150,264
1,000,000
(*) The amount in the current period is due to the purchase and capital increase of Trakya Yatırım Holding A.Ş. and Işbank AG and the amount in the prior period is due to the
purchasing shares of Moka Ödeme Kuruluşu A.Ş. by cash, İş Gayrimenkul Yatırım Ortaklığı A.Ş., İş Yatırım Menkul Değerler A.Ş. ve Türkiye Sınai Kalkınma Bankası A.Ş.s shares
followed in the Financial Assets at Fair Value Through Profit or Loss account is classified under subsidiaries and due to the capital increase of Trakya Yatırım Holding A.Ş.
(**) The differences arising from accounting by equity method is included.
(***) The committed capital of Trakya Yatırım Holding.
i.5. Sectoral information on financial subsidiaries and the related carrying amounts:
Current Period
Prior Period
16,800,054
8,036,340
7,310,823
4,353,568
937,316
544,978
12,325,177
4,678,171
37,373,370
17,613,057
Current Period
Prior Period
61,173,685
30,173,876
61,173,685
30,173,876
Related Companies
Banks
Insurance Companies
Factoring Companies
Leasing Companies
Finance Companies
Other Financial Subsidiaries
Total
i.6. Subsidiaries quoted on stock exchange:
Traded on domestic stock exchanges
Traded on foreign stock exchanges
Total
i.7. Subsidiaries disposed of in the current period: None.
i.8. Subsidiaries acquired in the current period: None.
j.
Information on jointly controlled entities:
There are no jointly controlled entities of the Bank.
k.
Information regarding finance lease receivables of the Bank (Net):
The Bank has no finance lease receivables.
l.
Explanations on derivative financial assets held for risk management:
The Bank has no derivative financial assets held for risk management.
m.
Information on tangible assets (net):
Real Estates
Leased
Tangible
Assets
Buildings
Under
Construction
Vehicles
Other Tangible
Assets
Total
Prior Period
Cost
6,180,660
2,867,073
84,832
31,315
3,342,423
12,506,303
Accumulated Depreciation
(13,452)
(1,344,413)
(20,343)
(2,428,235)
(3,806,443)
6,167,208
1,522,660
84,832
10,972
914,188
8,699,860
Net Book Value
Current Period End:
Net Book Value at the Beginning of
the Period
Change During the Period (Net) (*)
Depreciation
Impairment
Net Currency Translation Differences
(*)
6,167,208
1,522,660
7,278,554
(31,486)
28,990
857,502
(467,121)
5,610
84,832
19,268
10,972
13,331
(4,159)
1,137,208
(408,8719
914,188
8,699,860
9,305,863
(911,637)
28,990
73,872
177
68,085
Cost at the Period End
13,453,256
3,801,501
104,100
44,721
4,423,553
21,827,131
Accumulated Depreciation at the
Period End
(9,990)
(1,882,850)
(24,400)
(2,712,943)
(4,630,183)
Closing Net Book Value
13,443,266
1,918,651
104,100
20,321
1,710,610
17,196,948
(*) The balance includes the movements in cost and accumulated depreciation items.
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen
280 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 281
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
n.
Information on Intangible Assets:
Net Book Value at the Beginning of the Period
Change During the Period (Net) (*)
Depreciation
Impairment
Net Currency Translation Differences (*)
Cost at the Period End
Accumulated Depreciation at Period End
Closing Net Book Value
(*) The balance includes the movements in cost and accumulated depreciation items.
o. Explanations on investment property:
The Bank has no investment property.
p.
Information on deferred tax asset: None.
q. Information on assets held for sale and discontinued operations:
Current Period
Prior Period
1,750,109
2,515,348
(753,272)
2,248
6,700,672
(3,186,240)
3,514,433
1,330,841
748,959
(334,798)
5,107
4,183,060
(2,432,951)
1,750,109
Balance at the Beginning of the Period
Transfers (Net)
Depreciation (Net)
Impairment Losses (-)
Current Period
Prior Period
827,633
779,736
1,220,094
(392,461)
(6,744)
Balance at the End of the Period
1,600,625
827,633
(*) Cari dönemdeki değişimin 1.249.492 TL’lik kısmı, Genel Energy Plc.’nin sermayesindeki %12,28 oranındaki payın, alacağa mahsuben Banka’ya devrine ilişkindir.
Investment in a special purpose company whose details be given in Section Five footnote I.b.3 is classified within the scope of “TFRS-5 Assets Held
for Sale and Discontinued Operations”. In 2019 the Bank’s nominal values in company’s capital increased from TL 6 to TL 461,833 respectively. As
announced on KAP at the date of 31.03.2022, the sale and transfer of these shares to Türkiye Varlık Fonu has been completed and the provision for a
decrease in value has been reserved for the entire investment classified under “TFRS 5- Fixed Assets Held for Sale and Discontinued Operations”. The
shares in the amount of TL 461,833, which are tracked under “Impairment Losses on Assets Held for Sale and Subject to Discontinued Operations” and
were reserved for the entire decrease in value, were deleted from the asset together with the decrease in value provision within the scope of registration
of the liquidation of the company in the Türkiye Sicil Gazetesi dated 28.12.2022 and numbered 10735.
The other assets classified as “Assets Held for Sale” consist of securities and real estates. Those real estates subject to sale are announced on the
Bank’s web site. Announcements about the real estates subject to sale are also made by means of newspaper advertisements and similar media.
r.
Information on Other Assets:
The “other assets” item of the balance sheet does not exceed 10% of total assets.
II.
DISCLOSURES AND FOOTNOTES ON LIABILITIES
a. Information on Deposits:
a.1. The maturity structure of deposits (current period):
Current Period
Demand
7 Days
Notice
Up to 1
Month
1-3 Months
3-6 Months
6 Months to
1 Year
1 Year and
Over
Accumulated
Deposits
Total
Savings Deposits
52,151,311
13,192,421
57,543,852
89,132,133
5,629,299
4,469,259
4,453
222,122,728
Foreign Currency
Deposits
250,797,888
43,990,383 138,702,464
12,156,645
2,712,716 15,643,368
1,332 464,004,796
Residents in Turkey 216,603,225
41,815,382 119,253,957
10,256,517
1,609,679
4,488,134
1,312 394,028,206
Residents Abroad
34,194,663
2,175,001
19,448,507
1,900,128
1,103,037
11,155,234
20
69,976,590
Public Sector
Deposits
948,455
41,996
218,359
2,352
412
5
Commercial Deposits
55,067,638
53,590,998
12,165,643
19,907,452
8,470,551
4,974,482
Other Institutions
Deposits
Precious Metals
Deposits
933,998
1,585,467
2,555,476
126,370
11,971
30,133
61,964,641
10,925
3,864,020
221,532
8,091,907
339,773
Interbank Deposits
1,493,230
3,783,386
2,189,927
79
461,663
1,896,924
756
22,356
1,469,538
580
2,297,918
322,705
400,126
1,485,468
1,867,222
79
61,537
1,896,924
The Central Bank
of the Republic of
Turkey
Domestic Banks
Foreign Banks
Participations
Banks
Other
Total
423,357,161
116,195,576 217,239,741
121,546,563 25,378,519 27,353,944
5,785 931,077,289
Prior Period
Demand
7 Days
Notice
Up to 1
Month
1-3 Months
3-6 Months
6 Months to
1 Year
1 Year and
Over
Accumulated
Deposits
Total
Savings Deposits
29,129,615
10,101,438
62,338,966
8,091,893
879,420
1,026,512
6,422
111,574,266
Foreign Currency
Deposits
189,169,045
34,629,765 127,216,568
6,360,203
2,627,763
11,845,167
2,293
371,850,804
Residents in Turkey
170,392,877
32,260,729 110,981,890
4,853,136
1,507,234
4,219,586
1,517
324,216,969
Residents Abroad
18,776,168
2,369,036
16,234,678
1,507,067
1,120,529
7,625,581
776
47,633,835
Public Sector
Deposits
1,205,680
11,796
139,914
1,073
374
200
Commercial Deposits
18,126,103
17,701,731
12,082,163
173,276
515,975
28,850
Other Institutions
Deposits
Precious Metals
Deposits
602,088
571,697
3,160,538
40,352
2,411
51,875
46,013,605
1,055,562
150,880
6,508,325
311,651
Interbank Deposits
1,062,316
555,375
1,133,496
59
149,738
846,203
The Central Bank
of the Republic of
Turkey
Domestic Banks
Foreign Banks
Participations
Banks
Other
Total
480
198,421
863,350
65
450,260
105,115
538,289
595,207
148,477
59
1,261
846,203
285,308,452
63,571,802 207,127,207
14,817,736 10,684,006
14,110,458
8,715 595,628,376
Within the framework of the ""Communiqué on Supporting the Transformation into Turkish Lira Deposits and Participation Accounts" published in the Official
Gazette dated 24.02.2022 and numbered 31760 and the CBRT's communiques numbered 2021/14, 2021/16, 2022/7 and 2022/11, the Bank offers its
customers a TL deposit product with exchange rate protection. As of 31.12.2022, the amount of the foreign exchange-protected deposits opened within this
scope is TL 130,418,788 (31.12.2021: 6,116,412 TL).
1,211,579
154,176,764
5,243,415
74,492,798
9,825,209
756
3,043,105
6,780,768
580
1,359,037
48,628,098
4,428,961
54,040,023
3,747,187
480
1,335,447
2,411,195
65
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282 İşbank 2022 Integrated Annual Report
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Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
a.2. Savings deposits which are under the guarantee of Savings Deposits Insurance Fund exceeding the insurance limit:
c.3. Information on funds borrowed:
Savings Deposits
Savings Deposits
Foreign Currency Savings Deposits
Other Deposits in the Form of Savings Deposits
Foreign Branches’ Deposits Under Foreign
Authorities’ Insurance
Off-shore Banking Regions’ Deposits Under Foreign
Authorities Insurance
Under the Guarantee of Savings Deposits
Insurance Fund
Exceeding the Limit of Deposit Insurance
Fund
Current Period (*)
Prior Period
Current Period
Prior Period
98,271,661
76,393,000
26,836,200
54,291,725 122,016,357
56,062,849
58,931,256 221,588,222
19,430,372 41,995,951
175,476,819
31,613,866
11,433,523
6,751,204 3,622,595
3,869,864
(*) With the Official Gazette dated 27.08.2022 and numbered 31936, a change was made in the determination of the deposits subject to insurance, and all deposits except those
belonging to official institutions and credit and financial institutions were covered by insurance. Within this framework, there are commercial deposits amounting to TL 21,845,052
within the scope of the insurance, and the related amount is not shown in the table.
Information on funds received through syndicated loans and securitization deals, which take a significant place among funds borrowed, are given below.
Syndication loans:
Date of Use
June, 2022
November, 2022
Funds Borrowed
257,000,000 USD + 482,960,000 EUR
191,000,000 USD + 330,500,000 EUR
Maturity
1 year
1 year
Securitization deals:
The Bank obtained funds by way of putting on securitization deals all its claims and receivables based on diversified payment rights in USD, EUR and
GBP through TIB Diversified Payment Rights Finance Company.
Information on funds received through securitization is given below.
Date
Structured Entity
Amount
Final
Maturity
Remaining Debt Amount as at
December 31, 2022
a.3. Savings deposits which are not under the guarantee of deposit insurance fund:
Foreign Branches’ Saving Deposits and Other Accounts
Deposits and Other Accounts held by Main Shareholders and their Relatives
Deposits and Other Accounts of the Chairperson and Members of Board of Directors,
Chief Executive Officer, Senior Executive Officers and their Relatives
Deposits and Other Accounts Covered by Assets Generated Through the Offenses
Mentioned in Article 282 of the Turkish Criminal Code No,5237 and Dated 26 September
2004
Deposits in the Banks to be Engaged Exclusively in Off-shore Banking in Turkey
b. Information on Derivative Financial Liabilities Held for Trading:
Current Period
Prior Period
3,622,595
3,869,864
June 2012
TIB Diversified Payment Rights Finance Company
EUR 125,000,000
12 years
December 2013
TIB Diversified Payment Rights Finance Company
EUR 50,000,000
12 years
December 2014
TIB Diversified Payment Rights Finance Company
USD 220,000,000
14 years
March 2015
TIB Diversified Payment Rights Finance Company
USD 15,000,000
15 years
39,447
29,224
October 2015
TIB Diversified Payment Rights Finance Company
USD 221,200,000
10 years
October 2016
TIB Diversified Payment Rights Finance Company
USD 55,000,000
12 years
December 2016
TIB Diversified Payment Rights Finance Company
USD 158,800,000 10-13 years
December 2017
TIB Diversified Payment Rights Finance Company
USD 55,000,000
December 2017
TIB Diversified Payment Rights Finance Company
EUR 125,000,000
August 2022
TIB Diversified Payment Rights Finance Company
USD 227,000,000
7 years
9 years
5 years
EUR 21,875,000
EUR 15,000,000
USD 120,000,000
USD 13,593,750
USD 76,037,500
USD 32,195,112
USD 77,648,334
USD 22,000,000
EUR 101,190,476
USD 227,000,000
Derivative Financial Liabilities at Fair Value
Through Profit or Loss
Forward Transactions
Swap Transactions
Current Period
Prior Period
TL
104,067
2,700,243
FC
TL
FC
578,912
2,021,990
237,698
5,180,889
4,010,202
5,597,391
Other Transactions:
As of August 2014, in connection with the future cash flows securitization program amounting to USD 500 million on 10 years maturity, the bank has
increased the total amount of the financial instrument USD 600 million by obtaining the same structured USD 100 million in September 2017.
d.
Information on Debt Securities Issued (Net):
Futures
Options
Other
Total
c. Banks and other financial institutions:
c.1. Information on banks and other financial institutions:
Funds borrowed from the Central Bank of Turkey
Domestic banks and Institutions
Foreign banks, institutions and funds
Total
c.2. Maturity analysis of funds borrowed:
Short-term
Medium and Long-term
Total
32,132
244,575
131,283
461,724
126,245
2,836,442
6,004,376
6,163,475
6,423,058
Bills
Bonds
Total
Current Period
TL
FC
1,755,212
402,745
2,157,957
26,156,146
26,156,146
Prior Period
TL
3,133,754
2,060,702
5,194,456
FC
25,441,356
25,441,356
Current Period
Prior Period
TL
FC
TL
FC
e.
Concentration on the Bank's liabilities:
66% of the Bank's liabilities consists of deposits, 5% of loans borrowed, 4% of securities issued and Tier II subordinated loans. Deposits have spread to
a wide customer base with different characteristics. Borrowings are composed of funds obtained from various financial institutions through syndication,
securitization, post-financing and money markets.
802,041
2,564,571
3,366,612
8,117,800
667,413
7,245,047
59,970,914
1,837,639
55,901,327
68,088,714
2,505,052
63,146,374
f.
Information on Other Liabilities:
Other liabilities do not exceed 10% of the balance sheet total.
g.
Information on Lease Payables (net):
Current Period
Prior Period
TL
969,816
2,396,796
3,366,612
FC
5,720,964
62,367,750
68,088,714
TL
653,857
1,851,195
2,505,052
FC
6,295,676
56,850,698
63,146,374
Less than 1 Year
Between 1-4 Years
More than 4 Years
Total
Current Period
Prior Period
TL
FC
TL
FC
516
419,468
4,271,686
4,691,670
483
308,361
1,843,363
2,152,207
17,713
171,033
3,642,905
3,831,651
17,177
143,594
1,539,668
1,700,439
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284 İşbank 2022 Integrated Annual Report
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Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
h. Explanations on Hedging Derivative Financial Liabilities:
The bank has no financial liabilities held for hedging derivatives.
i.
Information on Provisions:
i.1. Reserves for employee benefits:
According to the related regulation and the collective bargaining agreements, the Bank is obliged to pay employee termination benefits to employees
who retire, die, quit for their military service obligations, who have been dismissed as defined in the related regulation or to the female employees who
have voluntarily quit within one year after the date of their marriage. In accordance with the related regulations, the amount of employee termination
benefits is TL 15,371.40 (exact TL amount as of December 31, 2022), which is one month salary for each service year and cannot exceed the base wage
ceiling for employee termination benefits. A provision for severance pays to allocate that employees need to be paid upon retirement is calculated by
estimating the present value of probable amount. The liability of the Bank arising from severance payment is determined in accordance with the actuarial
report prepared by an independent valuation company. As of December 31, 2022, provision amounting to TL 5,290,639 is reflected in the financial
statements (December 31, 2021: TL 2,278,323).
Main actuarial assumptions used in calculation of severance pay liability are as follows:
ੵ In the calculation, the discount rate is 22.45%, the inflation rate is 19.80%, and the real wage increase rate is 2%.
ੵ In the calculation, the ceiling of 15,371.40 TL (full TL amount) valid as of 31.12.2022 was taken as basis.
ੵ Retirement age is taken into account as the earliest age at which individuals can retire.
ੵ CSO 1980 mortality table is used for probability of death for women and men.
The movements related to provision for employee termination benefits are given below:
Present value of defined benefit obligation at the beginning of the period
Service Cost
Interest Cost
Benefits paid
Loss/(Gain) due to Settlements / Reductions / Terminations
Past Service Cost
Actuarial loss/(gain)
Defined benefit obligation at the end of the period
Current Period
Prior Period
2,278,323
158,573
421,268
(173,319)
10,174
1,941
2,593,679
5,290,639
1,393,897
94,375
166,952
(101,163)
11,064
713,198
2,278,323
In addition to the employee termination benefits the Bank allocates provisions for the unused vacation pay liability. As of December 31, 2022, provision
for unused vacation pay is amounting to TL 216,615 (December 31, 2021: TL 114,509).
i.2. Provisions for exchange losses in the principal amount of foreign currency indexed loans: Since foreign currency indexed loans are followed based
on the rates on the lending date, the Bank incurs a loss if the exchange rates decrease and makes profit if the exchange rate increases. As of December
31, 2022, and December 31, 2021, provision amount for the currency evaluation losses in the principal amount of foreign currency indexed loans is not
available.
i.3. As of December 31, 2021, the Bank’s specific provisions for indemnified non-cash loans balance is TL 1,616,688 (December 31, 2021: TL 1,214,355)
which is allocated for the non-cash loans of companies whose loans are followed under “Non-performing Loans” accounts.
i.4. Information on other provisions:
i.4.1. Liabilities arising from retirement benefits:
Liabilities of pension funds founded as per the Social Security Act:
Within the scope of the explanations given in Section Three Note XVII, in the actuarial report which was prepared as of December 31, 2022 for
Türkiye İş Bankası A.Ş. Emekli Sandığı Vakfı (İşbank Pension Fund) by a licensed actuary, of which each Bank employee is a member, and which has
been established according to the provisional Article 20 of the Social Security Act No. 506, the amount of actuarial and technical deficit stands at TL
8,379,741. As of the same date, a provision was reserved for this amount in the financial statements.
The above-mentioned actuarial audit, which was made in accordance with the principles of the related law, measures the cash value of the liability as of
December 31, 2022, in other words; it measures the amount to be paid to the Social Security Institution by the Bank. Actuarial assumptions used in the
calculation are given below.
ੵ 9.8% technical deficit interest rate is used.
ੵ 34.5% total premium rate is used.
ੵ CSO 1980 woman/man mortality tables are used.
Below table shows the cash values of premium and salary payments of the Bank as of December 31, 2022, taking the health expenses within the Social
Security Institution limits into account.
Net Present Value of Total Liabilities Other Than Health
Net Present Value of Long-Term Insurance Line Premiums
Net Present Value of Total Liabilities Other Than Health
Net Present Value of Health Liabilities
Net Present Value of Health Premiums
Net Present Value of Health Liabilities
Pension Fund Assets
Amount of Actuarial and Technical Deficit
The assets of the pension fund are as follows.
Cash and Cash Equivalents
Securities Portfolio
Other
Total
Current Period
Prior Period
(30,350,1649
13,123,522
(17,226,642)
(2,986,675)
9,514,553
6,527,878
2,319,023
(8,379,741)
(15,810,869)
5,858,707
(9,952,162)
(1,873,541)
4,247,562
2,374,021
1,483,086
(6,095,055)
Current Period
Prior Period
1,240,842
742,714
335,467
2,319,023
984,609
439,018
59,459
1,483,086
Health benefits that are still being paid will be determined within the framework of the Social Security Institution legislation and related regulations with
the transfer.
i.4.2. Provision of credit cards and promotion of banking services applications: As of December 31, 2022, the Bank has recognized provisions
amounting to TL 235,129 for the amount which is recognized within the framework of credit card expenses of credit card customers or promotions for
banking services. (December 31, 2021: TL 108,873).
i.4.3. As mentioned public disclosures of the Bank on December 31, 2012 and December 19, 2013; an inspection has been made by the inspectors of
Tax Inspection Board to "Türkiye İş Bankası A.Ş. Mensupları Munzam Sosyal Güvenlik ve Yardımlaşma Sandığı Vakfı" ("İşbank Supplementary Pension
Fund"), which was founded as per the provisions of the Turkish Commercial and Civil Codes, regarding the payments that fulfill İşbank's liabilities within
the framework of the Articles of Foundation of the Pension Fund and the relevant legislation. As a result of this investigation, tax audit reports were
prepared for the years 2007, 2008, 2009, 2010, 2011 claiming that the aforementioned liabilities should be taxed in terms of wage base, thus, they
should be subject to withholding tax and stamp duty. According to this report, the total amount of tax and penalties notified to Bank was TL 74,353 for
2007 and 2008; and as of reporting date TL 151,899 for 2009, 2010 and 2011 and it was stated that the Bank applied to tax courts to cancel these tax
notifications and some of the court decisions were determined in favor of the Bank and some others were determined against the Bank.
In this context, for the finalized decisions of Regional Administrative Courts related to the years 2007 and 2008 against the Bank, the Bank applied to
the Constitutional Court. According to decisions made by Constitutional Court up to reporting date, there is no predictability in legal conformity for taxing
the Bank's contributions to the Pension Fund in terms of wage base and for this reason it was accepted that property right of the Bank has been violated
according to the 35th article of Constitution. The Court decided that the amount of tax, penalties and default interest which was paid by the Bank should
be paid back to the Bank as for compensation with its legal interest.
According to the decision of the Constitutional Court, it is expected that the cases related to the periods 2007, 2008, 2009, 2010 and 2011 will conclude
in favor of the Bank. In this context, the provisions amounting to TL 207,402 which had been allocated for the mentioned periods, reversed at 2015.
In the last decision of the constitutional court numbered 2016/2400 regarding the legal proceedings initiated upon the conclusion of the lawsuits
amounting to TL 61,060 for the 20 periods in 2012 and 2013 against the bank; it was accepted that the predictability criterion was realized after the
2012 tax review, and it was concluded that the Bank’s ownership rights were not violated for December 2012 and beyond periods. However, since
the aforementioned periods were filed by making a reservation and paying taxes, the mentioned decision had no additional effect on the financial
statements. In addition, at two case files, which was one of the lawsuits regarding the repayment of income tax stoppage and stamp tax which has been
paid by reservation statement beginning from December 2013, of which its court decision was rendered in favour of the Bank, has been reversed by the
majority of the votes of the Assembly after it was submitted to the General Assembly of Tax Courts and the decisions were finalized against the Bank.
Regarding the mentioned issue, the legal process is ongoing.
Within the scope of these developments, the Bank recognized provisions amounting to TL 12,622 (December 31, 2021: TL 162,960).
i.4.4. In 1993, Dışbank A.Ş. shares which were owned by the Bank were sold to Lapis Holding A.Ş. In 2008, it was claimed that USD 75 million of the
amount, which was paid upfront within the context of the sale agreement, had been provided from the funds of the insolvent TYT Bank A.Ş. by the buyer
and payment of the mentioned amount as well as the interest to be calculated to the Savings Deposit Insurance Fund (SDIF) was demanded.
The administrative actions initiated by the SDIF in 2008 were revoked by Council of State Administrative Law Chambers 13th upon the application of
the Bank. The decisions which were in favour of the Bank were reversed by Plenary Session of the Law Chamber upon the appeal of the SDIF. Council of
State Administrative Law Chambers 13th decided to reject the applications of the Bank in January 2016 due to their obligation to obey the decisions of
reversal.
After the aforementioned court decisions, although the legal process was still in progress, the collection procedures were carried out within the context
of Law No. 6183 and TL 298,466 including the default interest, was collected from the Bank by the SDIF at prior periods and made provision for the
whole amount.
As a part of the legal process, individual application to the Constitutional Court of Republic of Turkey has been made by the Bank was not concluded
positively. Regarding the ongoing lawsuits, the negative declaratory action brought against the Bank to determine that the Bank is not a debtor has been
finalized against the Bank. In this context, necessary provision has been made by the Bank in the financial statements dated 31.12.2022 for the difference
between the down payment regarding the sales contract stated above and the amount of 52.6 million USD paid in 2016. legal process is still ongoing
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İşbank 2022 Integrated Annual Report 287
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
i.4.5. Except the other provisions indicated above, the Bank Management allocated free provision within conservatism principle, for negative
circumstances which may arise from the possible changes that may arise in the economy and market conditions, amounting to TL 8,475,000 of which
TL 4,075,000 provided in prior years and TL 4,400,000 was provided in the current period.
j.
j.1.
Information on Tax Liability:
Information on current tax liability:
j.1.1.
Information on tax provision:
Explanations in relation to taxation and tax calculations were stated in section three notes XVIII. As of 31.12.2022, the remaining corporate tax debt as a
result of netting of temporary taxes paid with corporate tax liability is TL 5,311,636.
Beginning Value
Deferred Tax Income / (Expense) (Net)
Deferred Tax Accounted Under Equity
Deferred Tax Accounted Under Previous Year P / L
Exchange rate differences
Net Deferred Tax (Asset)/Liability:
Current Period
Prior Period
2,557,610
4,792,962
(8,430,917)
(185)
(1,080,530)
3,420,494
(904,208)
41,245
79
2,557,610
Current Period
Prior Period
l. Information on subordinated loans:
k. Information on Payables for Assets Held for Sale and Discontinued Operations
The Bank does not have any payables for assets held for sale and discontinued operations.
j.1.2.
Information on taxes payable:
Corporate Tax Payable
Tax on Securities Income
Tax on Real Estate Income
Banking Insurance Transaction Tax
Foreign Exchange Transaction Tax
Value Added Tax Payable
Other
Total
j.1.3. Information on premiums:
Social Security Premiums – Employees
Social Security Premiums – Employer
Bank Pension Fund Premiums – Employees
Bank Pension Fund Premiums – Employer
Pension Fund Membership Fees and Provisions-Employees
Pension Fund Membership Fees and Provisions-Employer
Unemployment Insurance – Employees
Unemployment Insurance – Employer
Others
Total
j.2.Information on deferred tax liabilities:
5,311,636
376,516
7,431
570,782
52,378
67,390
158,108
6,544,241
1,051,363
234,685
5,590
324,422
117,926
23,653
65,785
1,823,424
Current Period
Prior Period
646
756
5,759
11,520
8
18,689
267
329
2,397
4,796
6
7,795
The Bank have TL 1,080,530 deferred tax liability as of December 31, 2022. The related deferred tax debt is calculated over the temporary differences
between the book values of assets and liabilities in the records and their tax base values calculated according to tax. If the items constituting the
temporary differences are followed up among the equity items, the deferred tax asset/liability calculated over the mentioned temporary differences is
associated with the related equity items.
Deferred Tax (Asset)/Liability:
Tangible Assets Base Differences
Provisions (*)
Valuation of Financial Assets
Other
Net Deferred Tax (Asset)/Liability:
Current Period
Prior Period
1,900,474
(7,694,748)
6,930,464
(55,660)
1,080,530
715,369
(5,339,164)
1,799,736
266,449
(2,557,610)
(*) Consists of employee benefits liabilities, actual and technical deficit of pension fund, credit card point provisions, expected loss provisions for Stage I and II loans and other
provisions.
Bank has issued subordinated debt securities, to be included in the contribution capital calculation, with the following nominal values;
ੵ 10 year-term in the amount of USD 400,000,000 with interest rate of 7.85% on December 10, 2013, 11 year-term having a call option on 6th year
in the amount of USD 500,000,000 with interest rate of 7% on June 29, 2017 and 10 year-term having a call option on 5th year in the amount of
USD 750,000,000 with interest rate of 7.75% on January 22, 2020 for the purpose of making available to the individuals and legal persons who are
resident abroad,
ੵ TL 1,100,000,000 on August 8, 2017, TL 800,000,000 June 19, 2019, and TL 350,000,000 September 26, 2019 (Full TL amount) each with a 10-
year maturity and floating interest rates for qualified investors without being offered to the public in Turkey.
The total of the aforementioned debt securities is TL 33,558,745 as of December 31, 2022 (December 31, 2021: TL 37,470,997).
Current Period
Prior Period
TL
FC
TL
FC
Debt Instruments To Be Included In Additional
Capital Calculation
Subordinated Loans
Subordinated Debt Instrument
Debt Instruments To Be Included In Contribution
Capital Calculation
Subordinated Loans
Subordinated Debt Instrument
Total
m. Information on shareholders’ equity:
m1. Presentation of paid-in capital:
Common shares
Preferred shares
Total
2,277,824
31,280,921
2,296,445
35,174,552
2,277,824
2,277,824
31,280,921
31,280,921
2,296,445
2,296,445
35,174,552
35,174,552
Current Period
Prior Period
9,999,970
30
10,000,000
4,499,970
30
4,500,000
m.2. Explanation as to whether the registered share capital system ceiling is applicable at the Bank, if so, the amount of registered share capital:
Capital System
Registered Capital System
Paid-in Capital
Ceiling
10,000,000
10,000,000
BRSA and CMB approvals regarding the increase of the registered capital ceiling to 25,000,000 TL have been obtained and the approval of the Ministry
of Commerce has been applied.
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288 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 289
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
m.3. The capital increase made in current period:
It has been decided to increase the paid-in capital of the Bank from TL 4,500,000 to TL 10,000,000, fully covered by internal resources (extraordinary
reserves). Accordingly, the process of capital increase was completed during the period and the registration of the new capital was carried out on
16.06.2022.
m.4.
Information on capital increase through transfer from capital reserves during the current period: None.
m.5. Significant commitments of the Bank related to capital expenditures within the last year and the following quarter, the general purpose thereof,
and the estimation of funds required for them: There is no capital commitment.
Information regarding the shares of the company acquired: The Bank has repurchased shares amounting to TL 530,307 in accordance with the
m.6.
Board of Directors Decision dated August 17, 2018.
m.7.
Previous periods’ indicators related to income, profitability and liquidity, and the estimated effects of forecasts, which are to be made by taking
into consideration the uncertainties of these indicators, on the Bank’s equity: The Bank’s balance sheet is managed in a prudent way to ensure that the
effect of risks arising from interest rates, exchange rates and loans is at the lowest level.
m.8. Privileges Granted to Shares:
Turkish Commercial Law and related registration are kept conditionally; Group (A) shares each with a nominal value of 1 Kurus have the privileges of;
ੵ Receiving 20 times the number of shares in the distribution of bonus shares issued from conversion of extraordinary and revaluation reserves
generated in accordance with the relevant laws (Article 18 of the Articles of Incorporation)
ੵ Exercising the preference rights as 20 times (Article 19 of the Articles of Incorporation), and
Despite having a lower nominal value, Group (B) shares, each with a nominal value of 1 Kurus, have the same rights with the Group (C) shares having
a nominal value of 4 Kurus each. Furthermore, Group (A) and (B) shares, each with a nominal value of 1 Kurus, are granted privileges in distribution of
profits pursuant to Article 58 of the Articles of Incorporation.
m.9.
Information on marketable securities value increase fund:
Financial Assets At Fair Value Through Other
Comprehensive Income
Valuation Difference
Deferred Tax Effect
Foreign Exchange Differences
Current Period
Prior Period
TL
FC
TL
FC
29,145,057
(4,586,932)
3,390,517
(2,730,702)
38,852,687
(9,707,630)
(5,949,482)
1,362,550
4,232,605
(842,088)
(3,353,951)
623,249
Total
29,145,057
(4,586,932)
3,390,517
(2,730,702)
n.
Information on Dividend Distribution:
At the Bank’s Ordinary General Assembly, held on March 25, 2022, it was decided to allocate net profit from operating activities of 2021, amounting to TL
13,467,895 as follows;
ੵ Resulting from the disposal of certain immovables, which are realized within the framework of the equity method specified in the "TAS 27 - Individual
Financial Statements" accounting standard, resulting from the application of the "TFRS 9 - Financial Instruments" reporting standard, and which are
followed within the scope of the "TAS 16 - Tangible Fixed Assets" accounting standard, adding a total of 5,414,586 TL,
ੵ Addition of the provision amount of TL 360,000 allocated during the period for the profit share to be distributed to the personnel within the framework
of the accounting standard "TAS 19-Benefits Provided to the Employees",
ੵ The total amount of TL 143,605, which includes TL 35,132 from real estate sales profits to use for capital increase and TL 108,473 from the amount
allocated as venture capital fund, of the balance sheet profit to be distributed amounting to TL 19,242,481 allocation as special reserve fund,
of the amount as a basis for distribution of TL 19,098,876;
ੵ TL 1,346,780 to A, B and C group shares as cash,
ੵ TL 10 to the founding shares as cash,
ੵ TL 359,481 as cash dividend to employees to be distributed,
ੵ TL 17,392,605 as legal and extraordinary reserves to be reserved,
has been decided. As of March 28, 2022; TL 17,536,210 was transferred to reserves account, cash dividends were distributed to the shares other than
the shares acquired by the Bank, as of April 1, 2022.
Since the Bank's Ordinary General Assembly Meeting for 2022 has not been held as of the report date, the profit from the activities of the
aforementioned period has not been distributed.
III. DISCLOSURES AND FOOTNOTES ON OFF BALANCE SHEET ITEMS
a.
a.1.
Explanations to Liabilities Related to Off-Balance Sheet Items:
Types and amounts of irrevocable loan commitments:
Commitment for customer credit card limits amounts to TL 112,111,363 and commitment to pay for cheque leaves amounts to TL
5,447,537. The amount of commitment for the forward purchase of assets is TL 2,302,086 and for the forward sale of assets is TL
2,214,219.
a.2.
The structure and amount of probable losses and commitments resulting from off-balance sheet items, including those below:
As of December 31, 2022, the Bank’s provisions for indemnified non-cash loans balance is TL 1,616,688 (December 31, 2021:
TL 1,214,355) which is allocated for the non-cash loans of companies whose loans are followed under “Non-performing Loans”
accounts. Commitments are shown in the table of “off-balance sheet items”.
a.3. Guarantees, bank acceptances, collaterals that qualify as financial guarantees, and non-cash loans including other letters of
credit:
Bank Acceptances
Letters of Credit
Other Guarantees
Total
Current Period
Prior Period
9,331,476
53,246,223
4,836,131
67,413,830
14,781,851
42,895,203
4,260,876
61,937,930
a.4. Certain guarantees, provisional guarantees, suretyships and similar transactions:
Letters of Tentative Guarantees
Letters of Certain Guarantees
Letters of Advance Guarantees
Letters of guarantee given to customs offices
Other Letters of Guarantee
Total
a.5. Total Non-cash Loans:
Non-cash Loans against Cash Risks
With Original Maturity of 1 Year or Less
With Original Maturity More Than 1 Year
Other Non-cash Loans
Total
Current Period
Prior Period
2,855,259
107,173,811
19,399,879
9,508,835
40,344,900
179,282,684
1,708,305
71,821,482
12,802,694
6,090,285
39,074,727
131,497,493
Current Period
Prior Period
40,344,898
11,721,587
28,623,311
206,351,616
246,696,514
39,074,716
9,466,630
29,608,086
154,360,707
193,435,423
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Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
a.6. Sectoral risk concentration of non-cash loans:
Agriculture
Farming and Livestock
Forestry
Fishery
Industry
Mining and Quarrying
Manufacturing Industry
Electricity, Gas, Water
Construction
Services
Wholesale and Retail Trade
Hotel and Restaurant Services
Transport and Communications
Financial Institutions
Real Estate and Rental Services.
Self-Employment Services
Education Services
Health and Social Services
Other
Total
TL
612,476
490,047
107,093
15,336
32,015,377
1,003,633
24,723,856
6,287,888
10,050,697
47,046,797
27,079,113
1,159,849
5,336,375
9,684,784
2,320,340
812,991
111,558
541,787
337,958
90,063,305
Current Period
(%)
FC
278,356
239,893
0.68
0.54
0.12
38,463
0.02
87,898,245
35.54
1,098,016
1.11
77,959,018
27.45
8,841,211
6.98
24,793,816
11.16
42,402,651
52.24
20,128,969
30.07
790,171
1.29
11,905,619
5.93
7,338,409
10.75
1,785,260
2.58
128,125
0.90
6,549
0.12
319,549
0.60
0.38
1,260,141
100 156,633,209
(%)
0.18
0.15
0.00
0.03
56.12
0.70
49.77
5.65
15.83
27.07
12.85
0.50
7.60
4.69
1.14
0.08
0.01
0.20
0.80
100
TL
296,207
199,806
82,391
14,010
12,116,069
320,342
8,066,185
3,729,542
7,521,162
25,865,094
15,532,556
450,043
3,081,863
4,543,921
1,418,515
502,777
73,900
261,519
267,825
46,066,357
Prior Period
(%)
FC
574,535
229,323
1,734
343,478
88,813,291
928,731
79,892,456
7,992,104
20,920,930
36,245,354
17,777,209
1,711,937
7,815,025
6,974,597
1,340,206
303,205
5,300
317,875
814,956
147,369,066
0.64
0.43
0.18
0.03
26.30
0.70
17.50
8.10
16.33
56.15
33.72
0.98
6.69
9.86
3.08
1.09
0.16
0.57
0.58
100
(%)
0.39
0.16
0.00
0.23
60.27
0.63
54.21
5.43
14.20
24.59
12.06
1.16
5.30
4.73
0.91
0.21
0.00
0.22
0.55
100
a.7. Non-cash Loans classified under Group I and Group II:
Non-cash Loans
Letters of Guarantee
Bank Acceptances
Letters of Credit
Endorsements
Group I
TL
88,634,615
82,888,613
5,575,390
170,612
FC
150,949,970
89,832,287
3,713,689
52,620,740
Group II
TL
FC
1,162,109
1,160,609
1,500
4,125,769
3,632,062
40,897
452,810
Underwriting Commitments of the Securities Issued
Factoring Related Guarantees
Other Guaranties and Warranties
4,783,254
b. Explanation on Derivative Financial Instruments:
Majority of the Bank’s derivative transactions comprise foreign currency and interest rate swaps, forward foreign exchange trading, and currency and
interest rate options. Even though some derivative transactions economically provide risk hedging, since all necessary conditions to be defined as
items suitable for financial risk hedging accounting are not met, they are recognized as “fair value through profit or loss” within the framework of TFRS 9
“Financial Instruments”.
c. Explanations Related to Contingencies and Commitments:
Balance of the “Other Irrevocable Commitments” account, which comprised the letters of guarantees, guarantees and commitments submitted by the
Bank pursuant to its own internal affairs and guarantees given to third parties by other institutions in favor of the Bank and the commitments due to
housing loans extended within the scope of unfinished house projects followed amounts to TL 18,101,440.
The cheques given to customers is presented under off balance sheet commitments, as per the related regulations is amounting to TL 5,447,537. In
case the cheques presented for payment to beneficiaries are not covered, the Bank will be obliged to pay the uncovered amount up to TL 3,000 (in exact
TL amount) for the cheques that are subject to the Law numbered 3167 on “the Regulation of Payments by Cheque and Protection of Cheque Holders”,
and up to TL 3,600 (in exact TL amount) for the cheques that are subject to the “Cheque Law” numbered 5941. The uncollected amount will be followed
under “Indemnified Non-Cash Loans”.
d. Explanations related to transactions made on behalf of or on the account of others:
It is explained in Note X under Section Four.
IV. DISCLOSURES AND FOOTNOTES ON STATEMENT OF INCOME
a. Interest Income
a.1. Information on interest income on loans:
Interest Income on Loans (*)
Short-term Loans
Medium and Long-term Loans
Interest on Non-performing Loans
Current Period
Prior Period
TL
FC
TL
FC
22,751,665
39,871,722
2,436,866
3,985,147
13,533,080
9,588,271 1,260,182
24,105,926
8,549,468
1,429
944,278
130
Premiums Received from State Resource Utilization Support Fund
Total
65,060,253
17,519,656
34,638,475
9,809,780
(*) Includes fee and commission income on cash loans.
a.2. Information on interest income on banks:
The Central Bank of Turkey
Domestic Banks
Foreign Banks
Foreign Head Offices and Branches
Total
a.3. Information on interest income from securities:
Current Period
Prior Period
TL
FC
TL
FC
52,130
155,264
39,543
2,725
71,739
528
194,883
31,889
29,548
194,807
249,738
103,628
30,076
Financial Assets at Fair Value Through Profit or Loss
Financial Assets at Fair Value Through Other Comprehensive Income
Financial Assets Measured at Amortised Cost
Total
Current Period
Prior Period
TL
49,293
21,905,813
14,951,212
FC
186,669
2,341,238
224,110
TL
52,159
8,216,820
5,757,657
FC
75,959
1,204,383
127,244
36,906,318
2,752,017
14,026,636
1,407,586
As detailed in Note VII of Chapter III, the Bank has consumer price indexed (CPI) government bonds classified as financial assets at fair value through
other comprehensive income, financial assets at fair value through profit or loss and financial assets measured by amortized cost in its securities
portfolio. In the case of CPI forecast changes by 100 basis points in a positive or negative direction, as of 31 December 2022, the Parent Bank’s pre-tax
profit will increase by approximately TL 127 million (full amount) or decrease by the same amount.
a.4. Information on interest income received from associates and subsidiaries:
Interest Income from Associates and Subsidiaries
1,253,289
613,651
Current Period
Prior Period
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Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
b. Interest Expense
b.1. Information on interest expense from funds borrowed:
Banks
Central Bank of Turkey
Domestic Banks
Foreign Banks
Foreign Head Offices and Branches
Other Institutions
Total (*)
(*) Includes fee and commission expenses from cash loans
Current Period
Prior Period
TL
FC
TL
FC
405,533
2,060,113
315,064
991,290
130,560
274,973
405,533
218,652
1,841,461
527,877
2,587,990
88,398
138,803
226,666
852,487
223,920
315,064
1,215,210
b.2. Information on interest paid to associates and subsidiaries:
Interest Paid to Associates and Subsidiaries
820,602
409,674
Current Period
Prior Period
b.3. Information on interest paid on marketable securities issued:
Interest on Securities Issued
1,144,803
4,625,715
1,260,390
3,501,106
Current Period
Prior Period
TL
FC
TL
FC
b.4. Information on Interest Expense on Deposits According to Maturity Structure:
Current Period
Demand
Deposits
Up to One
Month
Up to Three
Months
Up to Six
Months
Up to One
Year
Over One
Year
Accumulated
Deposits
Total
Time Deposits
75
8
215,565
132,256
347,896
1,540,779
8,305,750
9,067,691
536,973
396,682
464
19,848,347
2,663
23,780
10
42
2
Commercial Deposits
129
4,551,092
1,637,449
2,488,692
1,457,150
379,004
117,461
562,135
18,097
1,699
223
26,497
10,513,516
699,615
TL
Bank Deposits
Savings Deposits
Public Sector
Deposits
Other Institutions
Deposits
Deposits with 7 Days
Notice
Total
FC
212
6,427,560
10,661,370
11,574,490 1,995,864
775,911
464
31,435,871
Foreign Currency
Deposits
Bank Deposits
Deposits with 7 Days
Notice
57
18
90,662
616,716
55,377
6,079
166,602
2
935,495
51,284
14,074
2,463
1,775
15,267
84,881
Precious Metals
75
141.957
Deposits
Total
Grand Total
75
287
11
141,957
637.314
6,524
637,314
58.584
24.276
182.759
744
16,422
890
58,584
24,276
182,759
2
2
1.044.967
24,591
1,044,967
6,569,517
11,298,684
11,633,074
2,020,140
958,670
466
32,480,838
Prior Period
Demand
Deposits
Up to One
Month
Up to Three
Months
Up to Six
Months
Up to One
Year
Over One
Year
Accumulated
Deposits
Total
Time Deposits
TL
Bank Deposits
Savings Deposits
Public Sector
Deposits
236,834
109,341
346,175
10
1,089,360
10,622,231
622,976
87,086
115,091
645
12,537,399
Commercial Deposits
1,257
11,337
328
47
9
58
1,811,687
2,203,211
59,735
285,246
3,697
44,565
438,198
51,297
446
4,064
12,978
4,363,634
538,570
68
89
88
177
245
3,183,703
13,384,318
734,336
372,825
122,861
645
17,798,756
18,582
177,776
6,848
3,396
62,602
327
457
307
495
3,363
411
10,611
380
637
18,909
181,596
7,566
14,502
63,619
1
1
269,294
2,054
15,022
286,370
3,202,612
13,565,914
741,902
387,327
186,480
646
18,085,126
Other Institutions
Deposits
Deposits with 7
Days’ Notice
Total
FC
Foreign Currency
Deposits
Bank Deposits
Deposits with 7 Days
Notice
Deposits
Total
Grand Total
c.
Information on dividend income:
Financial Assets at Fair Value Through Profit and Loss
Financial Assets at Fair Value Through Other Comprehensive Income
Other
Total
d.
Information on trading income/losses (Net):
Income
Securities Trading Gains
Gains on Derivative Financial Instruments (*)
Foreign Exchange Gains
Losses (-)
Securities Trading Losses
Losses on Derivative Financial Instruments (*)
Foreign Exchange Losses
Trading Income /Losses (Net)
Current Period
Prior Period
12,976
25,628
9,176
11,559
38,604
20,735
Current Period
Prior Period
3,326,481
40,382,196
1,548,951,173
11,654
53,925,636
1,534,199,967
4,522,593
381,403
33,122,723
1,931,276,362
24,296
34,168,985
1,935,736,334
(5,149,127)
(*) Income arising from foreign currency changes related to derivative transactions amounts to TL 27,805,262 and the losses amount to TL 44,333,328 and the amount of net
losses TL 16,528,066 (December 31, 2021, profit: TL 28,826,011, loss: TL 30,043,929).
e.
Information on other operating income
Other operating income mainly consists of expected credit loss reversals or collections from Stage 3 loans, and income from fees received from
customers in return for various banking services and sales of fixed assets. On the other hand, the judicial process regarding the refund of the
administrative fine paid by the Bank in accordance with the decision of the Competition Board in 2013 was concluded in favor of the Bank, and the
administrative fine of TL 109,992 paid by the Bank was refunded.
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Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
f.
Information on expected credit loss and other provision expense:
i.
Information on provision for taxes from continuing and discontinued operations
Expected Credit Loss
12 Month Expected Credit Loss (Stage I)
Significant Increase in Credit Risk (Stage II)
Non-performing Loans (Stage III)
Impairment Losses on Marketable Securities
Financial Assets at Fair Value Through Profit or Loss
Financial Assets at Fair Value Through Other Comprehensive Income
Impairment Losses on Associates, Subsidiaries and Joint-Ventures
Associates
Subsidiaries
Jointly Controlled Entities
Other (*)
Total
Current Period
Prior Period
10,036,266
10,837,246
909,902
653,381
8,472,983
74,601
18,954
55,647
1,247,511
3,781,961
5,807,774
16,416
14,145
2,271
5,693,577
15,804,444
3,596,505
14,450,167
(1) The current period balance is the impairment loss expense of the assets held for sale and discontinued operations detailed in section five i.4.4, litigation provision expense of
TL 825,000 and TL 4,400,000 Includes free provision expense detailed in section five i.4.5..
h.
Other operating expenses:
Reserve for Employee Termination Benefits
Bank Pension Fund Deficit Provisions
Impairment Losses on Tangible Assets
Depreciation Expenses of Tangible Assets
Impairment Losses on Intangible Assets
Impairment Losses on Goodwill
Amortization Expenses of Intangible Assets
Impairment Losses on Equity Accounted Investments
Impairment Losses on Assets to be Disposed
Depreciation Expenses of Assets to be Disposed
Impairment Losses on Assets Held for Sale and Subject to Discontinued Operations
Other Operating Expenses
Leasing Expenses Related to Exceptions to TFRS 16
Repair and Maintenance Expenses
Advertisement Expenses (*)
Other Expenses (*)
Loss on Sale of Assets
Other (**)
Total
Toplam
Current Period
Prior Period
418,637
2,284,686
3,937
911,637
171,229
1,858,944
5,795
686,512
753,272
334,798
33,675
11,266,794
154,605
398,243
677,733
10,036,213
4,341
3,256,651
18,933,630
18.933.630
4,279,084
116,435
237,531
286,996
3,638,122
1,799
2,206,847
9,545,008
9.545.008
(*)) The amount of expenditure made by the Bank within the scope of donation, aid and social responsibility projects in the current period is TL 119,660 (December 31, 2021:TL
78,991).
(**) In the current period, 1,513,216 TL (31.12.2021: 1,016,208 TL) part of the related item consists of savings deposit insurance fund expenses, 665,046 TL (31.12.2021:
466,924 TL) part consists of fees, taxes, pictures, and fund expenses.
The Bank's profit before tax arises from continuing activities. As of 31 December 2022, TL 75,203,453 of the profit before tax consists of net interest
income, TL 16,146,898 of net fee and commission income, and the total of personnel expenses and other operating expenses is TL 34,029,278.
j.
Information on provision for taxes from continuing and discontinued operations
As of December 31, 2022, the amount of the Bank’s tax provision is TL 12,411,168 and the amount consists of current tax expense that is amounting to
TL 17,204,130 and consists of deferred tax expense amounting TL (4,792,962).
k.
Information on Net Operating Profit/Loss after Net Profit/Loss from Continuing and Discontinued Operations:
The Bank’s net profit made from its continuing operations as of December 31, 2022, amounts to TL 61,537,880.
l.
Information on net period profit/loss:
Income and expenses resulting from ordinary banking activities: There is no specific issue required to be disclosed for the Bank’s performance
l.1.
for the year ended period between January 1, 2022 – December 31, 2022.
l.2.
Effects of changes in accounting estimates on the current and future periods’ profit/loss: There is no issue to be disclosed.
‘‘The other’’ item which is located at the bottom of “Fees and Commissions Received” in the income statement consist of various fees and
l.3.
commissions received from transactions such as credit card transactions, capital market transactions.
m.
Explanation on other items on the income statement:
Other items do not exceed 10% of the total amount of the income statement.
n. Fees for services received from an independent audit firm:
In accordance with the decision of public oversight, accounting and auditing standards authority dated 26.03.2021, the fees for the reporting period
regarding the services received from the independent auditor or independent audit firm are given in the table below. In addition to the Bank, the fees for
services rendered to the Bank's domestic/foreign subsidiaries and jointly controlled partnerships are included in the aforementioned fees, which are
stated as VAT excluded.
Independent audit fee for the reporting period
Other Assurance Services and Other Non-Audit Fees
Total
Current Period
Prior Period
30,347
8,029
38,376
22,258
5,243
27,501
V.
DISCLOSURES AND FOOTNOTES ON STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY
The paid-in capital is TL 10,000,000 in legal records. As of balance sheet date, the balance of legal reserves is TL 6,168,857 and the balance of
extraordinary reserves is TL 52,282,743.
Detail of the securities increase fund is explained in Section Five Note II-m.9 and TL (8,345,080) of this amount is the deferred tax effect on financial
assets at fair value through other comprehensive income (31 December 2021: TL (218,839)).
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Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
VI.
DISCLOSURES AND FOOTNOTES ON STATEMENT OF CASH FLOWS
VII. DISCLOSURES AND FOOTNOTES ON THE BANK’S RISK GROUP
The operating profit to TL 29,321,468 before the changes in operating assets and liabilities mostly comprised of TL 103,691,818 of interest received
from loans and securities, and TL 43,427,261 of interest paid on deposits, loans, money market transactions and marketable securities borrowed by the
Bank. The account ‘’Other’’ classified under operating profit other than fees and commissions paid, cash payments to personnel and service suppliers
and taxes paid consists of other operating expenses, exchange and derivative gains/losses accounts is TL (25,604,457) (December 31, 2021: TL
13,095,475)).
Net Increase (Decrease) in Other Liabilities account classified in changes of assets and liabilities resulting from the changes in Funds Provided Under
Repurchase Agreements, miscellaneous payables, other liabilities and taxes, duties, charges, and premiums increase as TL 18,620,820 (December 31,
2021: TL 31,617,097 increase).
Net Cash Provided from Other Investing Activities account includes net cash flows from sale of intangible assets and declined by TL 2,515,348
(December 31, 2021: TL 748,958 decrease).
The effect of changes in foreign exchange rates on cash and cash equivalents is TL 967,080 as of December 31, 2022 (December 31, 2021: TL
(1,171,636)). Due to the high rate of turnover of related foreign currency assets, the difference between the last 30 days’ arithmetic average of currency
exchange rates and the year-end currency exchange rate is used to calculate the effect of change in foreign exchange rate.
Cash, cash in foreign currency, unrestricted deposits in Central Bank of Turkey, money in transit, cheques purchased, precious metals, money market
operations as well as demand and timed up to 3 months are defined as cash and cash equivalents.
Cash and cash equivalents at beginning of the period:
Cash
Cash in TL and Foreign Currency
Central Bank of Turkey and Other
Cash Equivalents
Banks’ Demand Deposits and Time Deposits Up to 3 Months
Money Market Receivables
Total Cash and Cash Equivalents
December 31, 2021
December 31, 2020
96,225,661
14,810,443
81,415,218
18,668,788
18,668,788
32,467,082
9,102,557
23,364,525
12,894,826
12,894,826
114,894,449
45,361,908
a. Information on the volume of transactions relating to the Bank’s risk group, incomplete loan and deposit transactions and period’s profit
and loss:
a.1. Information on loans held by the Bank’s risk Group
Current Period:
Bank’s Risk Group
Loans
Investments in Associates,
Subsidiaries and Jointly
Controlled Entities (Joint
Ventures)
Direct and Indirect
Shareholders of the Bank
Other Real Persons and
Corporate Bodies that have
been Included in the Risk
Group
Cash
Non-Cash
Cash
Non-Cash
Cash
Non-Cash
Balance at the beginning of the period
6,287,638
16,814,945
Balance at the end of the period
13,925,479
17,111,566
Interest and commission income received
1,249,418
11,388
4,452,442
7,328,993
569,202
608,277
1,309,862
13,400
Prior Period:
Bank’s Risk Group
Loans
Investments in Associates,
Subsidiaries and Jointly
Controlled Entities (Joint
Ventures)
Direct and Indirect
Shareholders of the Bank
Other Real Persons and
Corporate Bodies that have
been Included in the Risk
Group
Cash
Non-Cash
Cash
Non-Cash
Cash
Non-Cash
Balance at the beginning of the period
5,368,800
9,877,227
Balance at the end of the period
6,287,638
16,814,945
Interest and commission income received
612,064
6,879
2,585,068
4,452,442
232,067
494,875
608,277
8,628
The total amount resulting from the transactions made in the previous period shows the total cash and cash equivalents as of the beginning of the
current period.
a.2. Information on deposits held by the Bank’s risk group:
Cash and cash equivalents at end of the period:
Cash
Cash in TL and Foreign Currency
Central Bank of Turkey and Other
Cash Equivalents
Banks’ Demand Deposits and Time Deposits Up to 3 Months
Money Market Receivables
Total Cash and Cash Equivalents
December 31, 2022
December 31, 2021
Bank’s Risk Group
79,630,416
15,588,450
64,041,966
14,983,586
14,983,586
96,225,661
14,810,443
81,415,218
18,668,788
18,668,788
94,614,002
114,894,449
Investments in Associates,
Subsidiaries and Jointly
Controlled Entities (Joint
Ventures)
Direct and Indirect Shareholders
Risk Grubuna Dahil Olan Diğer
Gerçek ve Tüzel Kişiler
Deposits
Current Period
Prior Period Current Period
Prior Period Current Period
Prior Period
Balance at the beginning of the period
12.421.537
8.875.726
Balance at the end of the period
16.910.042
12.421.537
Interest expense on deposits
629.948
248.189
302.826
130.226
58.439
157.226
302.826
25.060
2.053.129
8.771.749
160.522
1.409.177
2.053.129
52.100
a.3. Information on forward and option agreements and other similar agreements made with the Bank’s risk group:
Investments in Associates,
Subsidiaries and Jointly
Controlled Entities (Joint
Ventures)
Direct and Indirect Shareholders
Risk Grubuna Dahil Olan Diğer
Gerçek ve Tüzel Kişiler
Current Period
Prior Period Current Period
Prior Period Current Period
Prior Period
1,966,285
15,007,188
(21,221)
1,574,671
1,966,285
(62,997)
4,033
2,474,171
1,226
4,033
(2,179)
Bank’s Risk Group
Transactions at Fair Value Through
Profit and Loss
Beginning of the period
End of the period
Total Profit/Loss
Transactions for hedging purposes
Beginning of the period
End of the period
Total Profit/Loss
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Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Unconsolidated Financial Statements
for the Year Ended December 31, 2022
b.
Disclosures for Bank’s risk group:
SECTION SIX: OTHER EXPLANATIONS
The relation of the Bank with corporations in its risk group and under its control regardless of whether there are any transactions between the
I.
Explanations On The Bank’s Credit Ratings:
b.1.
parties:
All types of corporate and retail banking services are provided to these corporations in line with the articles of Banking Law.
The type and amount of transaction carried out, and its ratio to the overall transaction volume, values of principal items and their ratios to overall
b.2.
items, pricing policy and other items in addition to the structure of the relationship:
MOODY’S
The transactions carried out are mainly loan and deposit transactions. The ratio of loans extended to the risk group to the overall cash loans is 2.80%,
while the ratio (excluding NPL) to the overall assets is 1.51%; the ratio of deposits of the risk group corporations to the overall deposits is 2.77%, while the
ratio to overall liabilities is 1.83%, the comparable pricing method is used for the transactions.
b.3.
Purchase and sale of real estates, other assets and services, agency agreements, finance lease contracts, transfer of information obtained
through research and development, license agreements, funding (including loans and provision of support as cash capital or capital-in-kind), guarantees
and collaterals, and management agreements:
Security purchases are made by İş Finansal Kiralama A.Ş., a subsidiary of the Bank, through leasing activities when required. The Parent Bank’s branches
act as agents of Anadolu Anonim Türk Sigorta Şirketi and Anadolu Hayat Emeklilik A.Ş. Furthermore, through its branches, the Bank mediates the order
transmission for İş Yatırım Menkul Değerler A.Ş. and carries out agency activities of İş Portföy Yönetimi A.Ş.
If requested, cash and non-cash loan requirements of corporations within the risk group are met in accordance with the limits imposed by the Banking
Law and the prevailing market conditions.
b.4.
As of December 31, 2022, total worth of the shares, which the Bank purchased from its subsidiaries that are traded on Istanbul Stock Exchange
and accounted under the Financial Assets at Fair Value Through Profit or Loss in accordance with the Board of Directors decision dated December 25,
2015, and relevant following decisions is TL 498,959 (December 31, 2021: TL 207,050).
c.
Total salaries and similar benefits paid to the (executive members and senior executives)
In the current period, the net payment provided to the key management amounts is TL 86,081 (December 31, 2021: TL 46,975).
VIII. Disclosures On The Bank’s Domestic, Foreign, Off-Shore Branches Or Associates And Foreign Representative Offices
Domestic Branches (*)
1.110
22.971
Number
Employees
Foreign Representative
Offices
Foreign Branches
Off-Shore Branches
1
1
2
14
2
2
1
Country of
Incorporation
China
Egypt
England
T.R.N.C.
Iraq
Kosovo
Bahrain
3
2
49
207
40
31
6
Total Assets
Legal Capital
53,147,779
28,264,019
6,837,919
3,157,421
8,094,514
2,248
80,000
842,061
199,247
Long-term Foreign Currency Deposit
Long-term Local Currency Deposit
Long-term Foreign Currency Senior Debt
Short-term Foreign Currency Deposit
Short-term Local Currency Deposit
FITCH RATINGS
Long-term Foreign Currency Issuer Default Rating
Long-term Local Currency Issuer Default Rating
Short-term Foreign Currency Issuer Default Rating
Short-term Local Currency Issuer Default Rating
National Long-term Rating
Viability Rating
Rating
Outlook (*)
B3
B3
B3
NP
NP
B-
B
B
B
A+ (tur)
B
Stable
Stable
Stable
-
-
Negative
Negative
-
-
Negative
-
The dates when the Bank's credit ratings/outlooks were last updated are given below:
Moody's: 16.08.2022, Fitch Ratings: 26.07.2022
(*) Outlook:
“Stable” indicates that the current rating will not be changed in the short term; “positive” indicates that the current rating is very likely to be upgraded and
“negative” indicates that the current rating is very likely to be downgraded.
SECTION SEVEN: EXPLANATIONS ON THE AUDITORS’ INDEPENDENT AUDIT REPORT
I.
Explanations On The Auditors’ Independent Audit Report:
The unconsolidated financial statements and disclosures for the period ended December 31, 2022, have been audited by Güney Bağımsız Denetim
ve Serbest Muhasebeci Mali Müşavirlik Anonim Şirketi (A member firm of Ernst&Young Global Limited) and the independent auditors’ report dated
February 6, 2023, is presented preceding the unconsolidated financial statements.
II.
Explanations And Footnotes Of The Independent Auditors Report
(*) The Branches located in Free Trade Zones in Turkey are included among domestic branches.
There are no significant issues or necessary disclosures or notes in relation to the Bank’s operations other than those mentioned above.
IX. Subsequent Events
Within the scope of the decision of the Board of Directors regarding the issue of debt instrument on October 7, 2022, the Bank issued a financial bond
with a nominal value of TL 1,481,892 after December 31, 2022.
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İşbank 2022 Integrated Annual Report 301
Independent Auditor’s Report
To the General Assembly of Türkiye İş Bankası Anonim Şirketi
Audit of Consolidated Financial Statements
Qualified Opinion
We have audited the accompanying consolidated financial statements of Türkiye İş Bankası A.Ş (the Bank) and its subsidiaries
(collectively referred as “The Group”), which comprise the consolidated statement of balance sheet
as at December 31, 2022, and the consolidated statement of income, consolidated statement of profit or loss and other
comprehensive income, consolidated statement of changes in shareholders’ equity, consolidated statement of cash flows and a
summary of significant accounting policies and other explanatory notes to the consolidated financial statements.
In our opinion, except for the effects of the matter on the consolidated financial statements described in the Basis of for Qualified
Opinion paragraph, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated
financial position of Türkiye İş Bankası A.Ş. as at December 31, 2022 and consolidated financial performance and consolidated its
cash flows for the year then ended in accordance with the Banking Regulation and Supervision Agency (“BRSA”) Accounting and
Financial Reporting Legislation which includes “Regulation on Accounting Applications for Banks and Safeguarding of Documents”
published in the Official Gazette no.26333 dated 1 November 2006, and other regulations on accounting records of Banks published
by Banking Regulation and Supervision Agency and circulars and interpretations published by BRSA and Turkish Financial Reporting
Standards (“TFRS”) for those matters not regulated by the aforementioned regulations.
Basis of Qualified Opinion
As explained in Section Five Part II-i.4.5. and IV.f, the accompanying consolidated financial statements as at December 31, 2022,
include a free provision at an amount of TL 8,475,000 thousands of which TL 4,075,000 thousands was provided in prior years
and TL 4,400,000 thousands provided in the current period by the Group management for the possible effects of the negative
circumstances which may arise from the possible changes in the economy and market conditions which does not meet the
recognition criteria of TAS 37 “Provisions, Contingent Liabilities and Contingent Assets”.
Our audit was conducted in accordance with “Regulation on independent audit of the Banks” published in the Official Gazette
no.29314 dated April 2, 2015 by BRSA (BRSA Independent Audit Regulation) and Independent Auditing Standards (“ISA”) which
are the part of Turkish Auditing Standards issued by the Public Oversight Accounting and Auditing Standards Authority (“POA”). Our
responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements
section of our report. We are independent of the Bank in accordance with of Code of Ethics for Independent Auditors (Code of
Ethics) published by POA and have fulfilled our other responsibilities in accordance with the code of ethics. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our qualified opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the consolidated
financial statements of the current period. Key audit matters were addressed in the context of our audit of the consolidated financial
statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. In addition to
the matter described in the Basis for Qualified Opinion section we have determined the matters described below to be the key audit
matters to be communicated in our report.
Türkiye İş Bankası Anonim Şirketi
Consolidated Financial Statements
As at and for the Year Ended
December 31, 2022
With Independent Auditor’s Report Thereon
(Convenience Translation of Consolidated Financial Statements
and Related Disclosures and Footnotes Originally Issued in Turkish)
This report includes “Independent Auditor’s Report” comprising
6 pages and; "Consolidated Financial Statements and Related
Disclosures and Footnotes” comprising 142 pages.
Convenience Translation of the Independent Auditor’s Report Originally Issued in Turkish
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İşbank 2022 Integrated Annual Report 303
Independent Auditor’s Report
Independent Auditor’s Report
Key Audit Matter
How the Key Audit Matter is addressed in our audit
Pension Fund Obligations
Financial impact of TFRS 9 “Financial Instruments” standard
and impairment on financial assets and related important
disclosures
As presented in Section III disclosure VIII, the Group
recognizes expected credit losses of financial assets in
accordance with TFRS 9 Financial Instruments standard.
We considered impairment of financial assets as a key audit
matter since:
ੵ Amount of on and off-balance sheet items that are subject
to expected credit loss calculation is material to the
financial statements.
ੵ There are complex and comprehensive requirements of
TFRS 9.
ੵ The classification of the financial assets is based on
the Group’s business model and characteristics of the
contractual cash flows in accordance with TFRS 9 and
the Bank uses significant judgment on the assessment
of the business model and identification of the complex
contractual cash flow characteristics of financial
instruments.
ੵ Policies implemented by the Bank management include
compliance risk to the regulations and other practices.
ੵ Processes of TFRS 9 are advanced and complex.
ੵ Judgements and estimates used in expected credit loss,
complex and comprehensive.
ੵ Disclosure requirements of TFRS 9 are comprehensive and
complex.
Our audit procedures included among others include:
ੵ Evaluating the appropriateness of accounting policies as to
the requirements of TFRS 9, Group’s past experience, local
and global practices.
ੵ Reviewing and testing of processes which are used
to calculate expected credit losses by involving our
Information technology and process audit specialists.
ੵ Evaluation of the reasonableness and appropriateness of
key judgments and estimates determined by management
and the methods, judgments, and data sources used in
calculating expected loss, taking into account the standard
requirements, industry and global practices.
ੵ Reviewing the appropriateness of criteria in order to identify
the financial assets having solely payments of principal
and interest and checking the compliance to the Group’s
Business model.
ੵ Evaluating the alignment of the significant increase in
credit risk determined during the calculation of expected
credit losses, default definition, restructuring definition,
probability of default, loss given default, exposure at default
and macro-economic variables that are determined by the
financial risk management experts with the Group’s past
performance, regulations, and other processes that has
forward looking estimations.
ੵ Assessing the completeness and the accuracy of the data
used for expected credit loss calculation.
ੵ Testing the mathematical accuracy of expected credit loss
calculation on sample basis.
ੵ Evaluating the judgments and estimates used for the
individually assessed financial assets.
ੵ Evaluating the necessity and accuracy of the updates
made or required updates after the modeling process
ੵ Auditing of TFRS 9 disclosures
It has been addressed whether there have been any
significant changes in regulations governing pension
liabilities, employee benefits plan during the period, that
could lead to adjust the valuation of employee benefits.
Support from actuarial auditor of our firm, has been taken to
assess the appropriateness of the actuarial assumptions and
calculations performed by the external actuary.
We further focused on the accuracy and adequacy of the
Bank’s provision provided for the deficit and also disclosures
on key assumptions related to pension fund deficit.
Employees of the Group are members of Emekli Sandığı
Vakıfları”, (“the Fund”), which is established in accordance
with the temporary Article 20 of the Social Security Act
No. 506 and related regulations. The Fund is a separate
legal entity and foundation recognized by an official decree,
providing all qualified employees with pension and post-
retirement benefits. As disclosed in the “Section Three
Note XX.2” to the financial statements, Banks will transfer
their pension fund to the Social Security Institution and the
authority of the “Council of Ministers” on the determination
of the mentioned transfer date is changed as “President” in
the Decree Law No. 703 published in the Official Gazette
numbered 30473 and dated July 9, 2018. According to
the technical balance sheet report as of 31 December
2022 prepared considering the related articles of the
Law regarding the transferrable benefit obligations for the
non- transferrable social benefits and payments which
are included in the articles of association, the Fund has an
actuarial and technical deficit which is fully provisioned for.
The valuation of the Pension Fund liabilities requires
judgment in determining appropriate assumptions such as
defining the transferrable social benefits, discount rates,
salary increases, demographic assumptions, inflation rate
estimates and the impact of any changes in individual
pension plans. The Group Management uses Fund actuaries
to assist in assessing these assumptions.
Considering the subjectivity of key assumptions and
estimate used in the calculations of transferrable liabilities
and the effects of the potential changes in the estimates
used together with the uncertainty around the transfer date
and given the fact that technical interest rate is prescribed
under the law, we considered this to be a key audit matter.
Derivative Financial Instruments
Derivative financial instruments including foreign exchange
contracts, currency and interest rate swaps, currency and
interest rate options, futures and other derivative financial
instruments which are held for trading are initially recognized
on the statement of financial position at fair value and
subsequently are re-measured at their fair value. The details
of the related amounts are explained in “Section Five Note I.c”,
and “Section Five Note II.b”.
Our audit procedures included among others involve
reviewing policies regarding fair value measurement
accepted by the Group management fair value calculations
of the selected derivative financial instruments which
is carried out by valuation experts of our firm and the
assessment of used estimations and the judgements and
testing the assessment of operating effectiveness of the key
controls in the process of fair value determination.
Fair value of the derivative financial instruments is
determined by selecting most convenient market data and
applying valuation techniques to those particular derivative
products. Derivative Financial Instruments are considered
by us as a key audit matter because of the subjectivity in the
estimates, assumptions and judgments used.
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İşbank 2022 Integrated Annual Report 305
Independent Auditor’s Report
Türkiye İş Bankası A.Ş.
Responsibilities of Management and Directors for the Consolidated Financial Statements
Group management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the BRSA
Accounting and Reporting Legislation and for such internal control as management determines is necessary to enable the preparation of the financial
statement that is free from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, management is responsible for assessing the Group’s ability to continue as a going concern,
disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to
liquidate the Bank or to cease operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Group’s financial reporting process.
Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements
In an independent audit, the responsibilities of us as independent auditors are:
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether
due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee
that an audit conducted in accordance with BRSA Independent Audit Regulation and ISAs will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to
influence the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with BRSA Independent Audit Regulation and ISAs, we exercise professional judgement and maintain professional
scepticism throughout the audit. We also:
ੵ Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform
audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. (The risk of
not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal control.)
ੵ Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of the Bank and its subsidiaries internal control.
ੵ Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
ੵ Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether
a material uncertainty exists related to events or conditions that may cast significant doubt on the Bank's and its subsidiaries subject to consolidation’s
ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the
related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on
the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Group to cease to continue as a
going concern.
ੵ Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the financial
statements represent the underlying transactions and events in a manner that achieves fair presentation.
ੵ Obtain sufficient appropriate audit evidence regarding the financial information of the entities and business activities within the Group to express an
opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the Group audit. We remain
solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit
findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with government with a statement that we have complied with relevant ethical requirements regarding independence,
and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable,
related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the
consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless
law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be
communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of
such communication.
Report on Other Legal and Regulatory Requirements
1. In accordance with Article 402 paragraph 4 of the Turkish Commercial Code (“TCC”) no 6102; no significant matter has come to our attention
that causes us to believe that the Bank’s bookkeeping activities and financial statements for the period January 1 – December 31, 2022 are not in
compliance with the TCC and provisions of the Bank’s articles of association in relation to financial reporting.
2. In accordance with Article 402 paragraph 4 of the TCC; the Board of Directors submitted to us the necessary explanations and provided required
documents within the context of audit.
The engagement partner who supervised and concluded this independent auditor’s report is Fatma Ebru Yücel.
February 7, 2023
İstanbul, Türkiye
The Consolidated Financial Report as at and for the Year
Ended December 31, 2022
Headquarters Address: İş Kuleleri, 34330, Levent/İstanbul
Telephone: 0212 316 00 00
Fax: 0212 316 09 00
Web Site: www.isbank.com,tr
E-mail: musteri.iliskileri@isbank.com.tr
The consolidated financial report as at and for the year ended prepared in accordance with the communiqué of “Financial Statements and Related Disclosures
and Footnotes to be announced to Public by Banks” as regulated by Banking Regulation and Supervision Agency, comprises the following sections:
GENERAL INFORMATION ABOUT THE PARENT BANK
CONSOLIDATED FINANCIAL STATEMENTS OF THE PARENT BANK
EXPLANATIONS ON THE ACCOUNTING POLICIES
INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT OF THE GROUP
DISCLOSURES AND FOOTNOTES ON THE CONSOLIDATED FINANCIAL STATEMENTS
OTHER EXPLANATIONS
INDEPENDENT AUDITOR’S REPORT
Associates, subsidiaries and structured entities whose financial statements have been consolidated in the consolidated financial report are as follows:
Associates
ARAP-TÜRK BANKASI A.Ş.
Subsidiaries
ANADOLU ANONİM TÜRK SİGORTA ŞİRKETİ
ANADOLU HAYAT EMEKLİLİK A.Ş.
EFES VARLIK YÖNETİM A.Ş.
İŞ FAKTORİNG A.Ş.
İŞ FİNANSAL KİRALAMA A.Ş.
İŞ GAYRİMENKUL YATIRIM ORTAKLIĞI A.Ş.
İŞ GİRİŞİM SERMAYESİ YATIRIM ORTAKLIĞI A.Ş.
İŞ PORTFÖY YÖNETİMİ A.Ş.
İŞ YATIRIM MENKUL DEĞERLER A.Ş.
İŞ YATIRIM ORTAKLIĞI A.Ş.
İŞBANK AG
JOINT STOCK COMPANY İŞBANK (JSC İŞBANK)
JOINT STOCK COMPANY ISBANK GEORGIA (JSC ISBANK GEORGIA)
MAXİS GİRİŞİM SERMAYESİ PORTFÖY YÖNETİMİ A.Ş.
MAXIS INVESTMENTS LTD.
MİLLİ REASÜRANS T.A.Ş.
MOKA ÖDEME VE ELEKTRONİK PARA KURULUŞU A.Ş.
TSKB GAYRİMENKUL YATIRIM ORTAKLIĞI A.Ş.
TÜRKİYE SINAİ KALKINMA BANKASI A.Ş.
YATIRIM FİNANSMAN MENKUL DEĞERLER A.Ş.
YATIRIM VARLIK KİRALAMA A.Ş.
Structured Entities
TIB DIVERSIFIED PAYMENT RIGHTS FINANCE COMPANY
The consolidated yearended financial statements and related disclosures and footnotes in this report are prepared, in accordance with the Regulation
on the Procedures and Principles for Accounting Practices and Retention of Documents by Banks. Banking Regulation and Supervision Agency (BRSA)
regulations, Turkish Accounting Standards, Turkish Financial Reporting Standards and the related statements and guidance and in compliance with the
financial records of our Bank. Unless otherwise stated the accompanying consolidated financial report is presented in thousands of Turkish Lira (TL) and
has been subjected to independent auditand presented as the attached.
Ersin Önder Çiftçioğlu
Member of the Board and
the Audit Committee
Yusuf Ziya Toprak
Deputy Chairperson of the Board of Directors
and Chairperson of the Audit Committee
Adnan Bali
Chairperson of the Board of Directors
Ali Tolga Ünal
Head of Financial Management Division
Gamze Yalçın
Deputy Chief Executive In Charge of
Financial Reporting
Hakan Aran
Chief Executive Officer
The authorized contact person for questions on this consolidated financial report:
Name – Surname / Title: Neşe Gülden Sözdinler / Head of Investor Relations and Sustainability Division
Phone No
Fax No
E-mail
: +90 212 316 16 02
: +90 212 316 08 40
: Nese.Sozdinler@isbank.com.tr
investorrelations@isbank.com.tr
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306 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 307
Content
SECTION I
General Information about the Parent Bank
I.
Explanations on the Establishment Date and Initial Status of the Parent Bank, and History Including the Changes in the Former Status
II.
III.
IV.
V.
VI.
Explanations on the Capital Structure, Shareholders who Directly or Indirectly, Solely or Jointly Undertake the Management and
Control of the Parent Bank any Changes in the Period, and Information on the Parent Bank’s Risk Group
Explanations on the Chairperson’s, Directors’, Auditors’, Chief Executive Officer’s and Deputy Chief Executives’ Shares, if any, and the
Areas of their Responsibility at the Bank
Information on the Parent Bank’s Qualified Shareholders
Summary Information on the Parent Bank’s Functions and Business Lines
Differences between the Communiqué on Preparation of Consolidated Financial Statements of Banks and Turkish Accounting
Standards and Explanation about the Institutions Subject to Line-By-Line Method or Proportional Consolidation and Institutions
which are Deducted from Equity or not Included in These Three Methods
VII.
Existing or Potential, Actual or Legal Obstacles on the Transfer of Shareholders’ Equity Between the Parent Bank and its Subsidiaries
or the Reimbursement of Liabilities
308
308
308
309
309
309
311
VIII. Written Policies on Assessment of Ensuring Compliance on Market Discipline, Disclosure Obligations, Frequency and Accuracy of the
311
Related Disclosures
SECTION II
Consolidated Financial Statements
I.
Consolidated Balance Sheet – Assets
II.
III.
IV.
V.
VI.
VII.
VIII.
Consolidated Balance Sheet – Liabilities
Consolidated Statement of Off-Balance Sheet Items
Consolidated Statement of Profit or Loss
Profit or Loss and Other Comprehensive Income
Consolidated Statement of Changes in the Shareholders’ Equity
Consolidated Statement of Cash Flows
Consolidated Statement of Profit Appropriation
SECTION III
Explanations on Accounting Policies
Basis of Presentation
I.
II.
III.
IV.
V.
VI.
VII.
VIII.
IX.
X.
XI.
XII.
XIII.
XIV.
XV.
Strategy for Use of Financial Instruments and on Foreign Currency Transactions
Information on the Consolidated Companies
Forward, Option Contracts and Derivative Instruments
Interest Income and Expenses
Fees and Commission Income and Expenses
Financial Assets
Impairment of Financial Assets
Offsetting Financial Instruments
Sale and Repurchase Agreements and Securities Lending Transactions
Non-current Assets Held for Sale and Discontinued Operations and Related Liabilities
Goodwill and Other Intangible Assets
Tangible Assets
Investment Property
Leasing Transactions
XVI.
Insurance Technical Income and Expense
XVII.
Insurance Technical Provisions
XVIII. Provisions and Contingent Liabilities
XIX.
XX.
XXI.
Contingent Assets
Liabilities Regarding Employee Benefits
Taxation
XXII. Additional Information on Borrowings
XXIII.
Information on Equity Shares and Their Issuance
XXIV. Bank Acceptances and Bills of Guarantee
XXV. Government Incentives
XXVI. Segment Reporting
XXVII. Other Diclosures
312
313
314
316
317
318
320
321
322
322
323
324
325
325
325
325
326
327
327
327
328
328
328
329
329
329
330
330
331
333
333
333
333
333
333
SECTION IV
Information on the Financial Position and Risk Management of the Group
XXVIII. Explanations on Shareholders’ Equity
XXIX. Explanations on Credit Risk
XXX. Explanations on Currency Risk
XXXI. Explanations on Interest Rate Risk
XXXII. Explanations on Equity Shares Risk Arising from Banking Book
XXXIII. Explanations on Liquidity Risk Management and Consolidated Liquidity Coverage Ratio
XXXIV. Explanations on Leverage Ratio
XXXV. Explanations on Other Price Risks
XXXVI. Explanations on The Presentation of Financial Assets and Liabilities at Fair Value
XXXVII. Explanations on Transactions Made on Behalf of Others and Transactions Based on Fiduciary
XXXVIII.
Explanations on Risk Management
XXXIX. Explanations on Segment Reporting
SECTION V
Disclosures and Footnotes on the Consolidated Financial Statements
I.
Disclosures and Footnotes on Consolidated Assets
II.
III.
IV.
V.
VI.
VII.
VIII.
IX.
Disclosures and Footnotes on Consolidated Liabilities
Disclosures and Footnotes on Consolidated Off-Balance Sheet Items
Disclosures and Footnotes on Consolidated Income Statement
Disclosures and Footnotes on the Statement of Changes in Equity
Disclosures and Footnotes on The Cash Flow Statement
Disclosures and Footnotes on the Bank’s Risk Group
Disclosures on the Bank’s Domestic, Foreign, Off-Shore Branches or Subsidiaries and Foreign Representative Offices
Subsequent Events
SECTION VI
Other Explanations
I.
Explanation on the Group’s Credit Ratings
SECTION VII
Explanations on the Independent Audit Report
I.
Explanations on the Independent Auditors’ Report
II.
Explanations and Footnotes of the Independent Auditors Report
334
341
350
352
356
357
362
363
363
365
365
381
382
396
405
407
411
412
413
414
416
416
417
417
417
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308 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 309
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statements
for the the Year Ended December 31, 2022
Notes To The Consolidated Financial Statements
for the the Year Ended December 31, 2022
I.
Explanations on the Establishment Date and Initial Status of the Parent Bank, and History Including the Changes in the Former Status
Chief Executive Officer and Deputy Chief Executives:
TÜRKİYE İŞ BANKASI A.Ş. (“the Bank” or “the Parent Bank”) was established on August 26, 1924 to operate in all kinds of banking activities and to
initiate and/or participate in all kinds of financial and industrial sector undertakings when necessary. There is no change in the Bank’s status since its
establishment.
II.
Explanations on the Capital Structure, Shareholders who Directly or Indirectly, Solely or Jointly Undertake the Management and
Control of the Parent Bank, any Changes in the Period, and Information on the Parent Bank’s Risk Group
As of December 31, 2022, 37.31% of the Bank’s shares are owned by T. İş Bankası A.Ş. Supplementary Pension Fund (Fund), 28.09% are owned by the
Republican People’s Party- CHP (Atatürk’s shares) and 34.60% are on free float (December 31, 2021: Fund 37.26%, CHP 28.09%, Free float 34.65%).
III.
Explanations on the Chairperson’s, Directors’, Auditors’, Chief Executive Officer’s and Deputy Chief Executives’ Shares, if any, and the
Areas of their Responsibility at the Bank
Chairperson and Members of the Board of Directors:
Name and Surname
Areas of Responsibility
Adnan Bali
Yusuf Ziya Toprak
Hakan Aran
Feray Demir
Ersin Önder Çiftçioğlu
Fazlı Bulut
Durmuş Öztek
Recep Hakan Özyıldız
Mustafa Rıdvan Selçuk
Ahmet Gökhan Sungur
Sadrettin Yurtsever
Chairperson of the Board of Directors, Remuneration Committee, Chairperson of the Risk Committee,
Sustainability Committee and Chairperson of the Board of Directors Operating Principles Committee
and the Member of the Credit Committee
Deputy Chairperson of the Board of Directors, Chairperson of the Audit Committee, TRNC Internal
Systems Committee and Operational Risk Committee, Member of the Risk Committee and Substitute
Member of the Credit Committee
Chief Executive Officer and Board Member, Chairperson of the Credit Committee, Human Resources
Committee and Information Systems Strategy Committee, Natural Member of the Risk Committee,
Chairperson of the Executive Committee
Director, Member of the Credit Committee, Corporate Governance Committee, Remuneration
Committee, Corporate Social Responsibility Committee, Sustainability Committee, and the Member of
the Board of Directors Operating Principles Committee
Director, Chairperson of the Sustainability Committee, Member of the Audit Committee and TRNC
Internal Systems Committee, Member of the Risk Committee and Operational Risk Committee
Director, Member of Corporate Social Responsibility Committee and Substitute Member of the Credit
Committee
Director, Member of Corporate Social Responsibility Committee, and the Member of the Board of
Directors Operating Principles Committee
Director
Director
Director
Name and Surname
Areas of Responsibility
Hakan Aran
Nevzat Burak Seyrek
Ebru Özşuca
Gamze Yalçın
H. Cahit Çınar
Ozan Gürsoy
Sezgin Yılmaz
Sabri Gökmenler
Sezgin Lüle
Can Yücel
Sezai Sevgin
İzlem Erdem
Suat E. Sözen
O. Tufan Kurbanoğlu
Mehmet Celayir
Chief Executive Officer and Member of the Board of Directors, Credit Committee, Chairperson of Human Resources
Committee and Information Technologies Strategic Committee Natural Member of Risk Committee, Member of
Operational Risk Committee and Chairperson of the Executive Committee
Corporate and Commercial Banking Marketing, Commercial Banking Sales, Transboundary Banking, Free Zone Branches,
Member of the Sustainability Committee
Treasury, Economic Research, Capital Markets, Member of the Risk Committee
Financial Management, Financial Institutions, Investor Relations and Sustainability, Managerial Reporting and Internal
Accounting, Information Technologies Strategic Committee, Member of Risk Committee and Sustainability Committee
Legal Consultancy, Associates, Member of the Operational Risk Committee, Construction and Real Estate Management,
Member of the Sustainability Committee
Human Resources Management, Strategic and Corporate Performance Management, Agile Management, Corporate
Architecture, Member of Information Technologies Strategic Committee, Operational Risk Committee and Sustainability
Committee
Member of Retail Banking Marketing, Sales and Products, Retail Loans, Sustainability Committee
Information Technologies, Data Management, Acquisition, Artificial Intelligence, Member of Operational Risk Committee,
Sustainability Committee, and Information Technologies Strategic Committee
Customer Relations Coordination Responsible, Digital Banking, Customer Relations, Card Payment Ecosystems, Card
Payment Operations, Card Payment Products and Member of Operational Risk Committee
Retail, Commercial and Corporate Loans Allocation, Loans Monitoring, Credits Portfolio Management, Project Finance,
Member of the Corporate Social Responsibility Committee, Member of the Risk Committee and Sustainability Committee
Information Security, Internal Control, Corporate Compliance, Natural Member of the Risk Committee, Information
Technologies Strategic Committee, Member of the Operational Risk Committee and Sustainability Committee
SME and Enterprise Banking Product and Sales, Agricultural Banking Marketing, Commercial Banking Product, Member of
Sustainability Committee
General Secretary, Corporate Communication, Digital Banking, Member of the Corporate Social Responsibility Committee,
Member of the Sustainability Committee
Legal Affairs and Legal Proceedings, Loans Monitoring, Commercial and Corporate Loans and Retail Loans Proceedings
Member of Banking Base Operations, Agile Management, Support Services, External Operations and Commercial Loan
Operations, Operational Risk Committee
At the meeting of the Board of Directors of the Bank dated 13.12.2022, it was decided to appoint Mr. Mehmet Celayir to the position of Deputy Chief Executive. Mr. Yalçın Sezen
retired from his position at the Bank on 31.01.2023.
The Parent Bank’s shares attributable to the Directors and members of the Audit Committee, to the CEO and the Deputy Chief Executives are of minor
importance.
IV.
Information on the Parent Bank’s Qualified Shareholders
Director, Member of Corporate Governance Committee and Corporate Social Responsibility Committee
Name Surname/Company
Shares
Ownership
Paid-in Capital
Unpaid Capital
T, İş Bankası A.Ş. Mensupları Munzam Sosyal
Güvenlik ve Yardımlaşma Sandığı Vakfı (“İşbank
Members’ Supplementary Pension Fund”)
Cumhuriyet Halk Partisi – Republican People’s
Party (Atatürk’s Shares)
3,731,244
37.31%
3,731,244
2,809,205
28.09%
2,809,205
V.
Summary Information on the Parent Bank’s Functions and Business Lines
In line with the relevant legislation and principles stated in the Articles of Incorporation of the Bank, the Bank’s activities include operating in retail,
commercial, corporate and private banking, foreign currency and money market operations, marketable securities operations, international banking
services and other banking operations, as well as initiating or participating in all kinds of financial and industrial sector corporations as may be required.
VI.
Differences between the Communiqué on Preparation of Consolidated Financial Statements of Banks and Turkish Accounting
Standards and Explanation about the Institutions Subject to Full Consolidation Method or Proportional Consolidation and
Institutions which are deducted from Equity or not included in these Three Methods
Banks are obligated to prepare consolidated financial statements for credit institutions and financial subsidiaries for creating legal restrictions on
a consolidated basis based on the “Communiqué on Preparation of Consolidated Financial Statements of Banks” by applying Turkish Accounting
Standards. There is not any difference between the related Communiqué and the consolidation operations that is based on Turkish Accounting
Standards and Turkish Financial Reporting Standards.
The consolidated financial statements in this report includes the subsidiaries of the Bank, which are credit or financial institutions, in accordance with the
BRSA regulations. As of current period, there is no credit or financial institution subsidiaries which are excluded in the scope of the consolidation.
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 310 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 311
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statements
for the the Year Ended December 31, 2022
Notes To The Consolidated Financial Statements
for the the Year Ended December 31, 2022
The Parent Bank and its subsidiaries;
ੵ ANADOLU ANONİM TÜRK SİGORTA ŞİRKETİ
ੵ ANADOLU HAYAT EMEKLİLİK A.Ş.
ੵ EFES VARLIK YÖNETİM A.Ş.
ੵ İŞ FAKTORING A.Ş.
ੵ İŞ FİNANSAL KİRALAMA A.Ş.
ੵ İŞ GAYRİMENKUL YATIRIM ORTAKLIĞI A.Ş.
ੵ İŞ GİRİŞİM SERMAYESİ YATIRIM ORTAKLIĞI A.Ş.
ੵ İŞ PORTFÖY YÖNETIMI A.Ş.
ੵ İŞ YATIRIM MENKUL DEĞERLER A.Ş.
ੵ İŞ YATIRIM ORTAKLIĞI A.Ş.
ੵ İŞBANK AG
ੵ JSC İŞBANK
ੵ JSC İŞBANK GEORGIA
ੵ MAXİS GİRİŞİM SERMAYESİ PORTFÖY YÖNETİMİ A.Ş.
ੵ MAXİS INVESTMENTS LTD.
ੵ MİLLİ REASÜRANS T.A.Ş.
ੵ MOKA ÖDEME VE ELEKTRONİK PARA KURULUŞU A.Ş.
ੵ TSKB GAYRİMENKUL YATIRIM ORTAKLIĞI A.Ş.
ੵ TÜRKİYE SINAİ KALKINMA BANKASI A.Ş.
ੵ YATIRIM FİNANSMAN MENKUL DEĞERLER A.Ş.
ੵ YATIRIM VARLIK KİRALAMA A.Ş.
ੵ
and Structured Entity;
ੵ TIB DIVERSIFIED PAYMENT RIGHTS FINANCE COMPANY
is included in the consolidated financial statements with “full consolidation method”.
The Parent Bank’s associate acting as a credit institution;
ੵ ARAP-TÜRK BANKASI A.Ş.
is accounted under equity accounting method in the consolidated financial statements.
Consolidated companies are active in the areas of banking, insurance and reinsurance, private pensions, finance leasing, factoring, real estate
investment, venture capital investment, brokerage, investment consulting, portfolio and asset management. Those companies are explained below.
Anadolu Anonim Türk Sigorta Şirketi
İş Portföy Yönetimi A.Ş.
The purpose of the Company, which was founded in 2000, is to engage in capital market operations stated in its articles of association. Among the
capital market operations, the company offers portfolio management and investment consulting services only to corporate investors.
İş Yatırım Menkul Değerler A.Ş.
The Company’s main field of activity is composed of intermediary, corporate finance, investment consulting and private portfolio management services.
The Company’s shares are traded in the Borsa İstanbul A.Ş. since May 2007.
İş Yatırım Ortaklığı A.Ş.
The aim of the Company, which was founded in İstanbul in the year 1995, is to operate in capital market activities which is stated in the principal
agreement, and Company’s main field of activities is portfolio management. The Company’s shares are traded in the Borsa İstanbul A.Ş. since April 1996.
İşbank AG
İşbank AG was founded to carry out the banking transactions in Europe. İşbank AG has 9 branches in total, 8 branches in Germany and 1 branch in
Netherlands.
JSC İşbank
The Bank, which was acquired in 2011 and based in Moscow, is operating banking services as, corporate banking, individual deposits, treasury
transactions and foreign trade financing operations with its Moscow Branch and representative offices in St. Petersburg and Kazan.
JSC İşbank Georgia
The Bank, which was established in Georgia in the third quarter of 2015, is operating banking services mainly deposit, loan and exchange transactions.
As part of the organizational structure of Parent Bank in abroad, Batumi and Tbilisi branches which were established in 2012 and 2014 respectively
proceed its operations as JSC Isbank Georgia.
Maxis Girişim Sermayesi Porföy Yönetimi A.Ş.
The purpose of the Company, which was founded in November 2017, is to establish and manage capital investment funds in accordance with the Capital
Markets Law and related legislations.
Maxis Investments Ltd.
The purpose of the Company, which was founded in England in the year 2005, is to operate in activities in foreign capital markets.
Milli Reasürans T.A.Ş.
The Company, which was founded in 1929, aims to provide reinsurance and retrocession services in foreign and domestic branches. It has 1 branch in
Singapore.
The Company was established in 1925 and operates in almost all non-life insurance service. The Company’s shares are traded in the Borsa İstanbul A.Ş.
Moka Ödeme ve Elektronik Para Kuruluşu A.Ş.
Anadolu Hayat Emeklilik A.Ş.
The company was acquired in 2021. The company established of 2014 and it operates in the field of payment services.
The Company was founded in 1990 and its’ headquarter is located in Istanbul. The company’s main activities are private or group pension and life/death
insurance and all kinds of insurance services related to these branches. There are 34 private pension funds offered by the company to the subscribers.
The company’s shares are traded in the Borsa Istanbul A.Ş.
TSKB Gayrimenkul Yatırım Ortaklığı A.Ş.
The core business activity of the Company, which was founded in 2006, is to create and develop an investment property portfolio and to invest in capital
market instruments that are based on investment properties. The Company’s shares are traded in the Borsa İstanbul A.Ş. since April 2010.
Efes Varlık Yönetim A.Ş.
Türkiye Sınai Kalkınma Bankası A.Ş.
The field of activity of the company, which was founded in February 2011, is to purchase and sell the receivables with other assets of deposit banks,
participation banks and other financial institutions.
Türkiye Sınai Kalkınma Bankası A.Ş. (TSKB) which is an industrial development, and an investment bank is founded specially to support private sector
investments in industry and to provide domestic and foreign capital to Turkish companies. The Bank’s shares are traded in the Borsa İstanbul A.Ş.
İş Faktoring A.Ş.
Yatırım Finansman Menkul Değerler A.Ş.
The Company, which operates in the factoring sector since 1993, is engaged in domestic and foreign factoring operations.
The Company was founded in 1976. The purpose of the Company is to engage in capital market operations stated in its articles of association.
İş Finansal Kiralama A.Ş.
Yatırım Varlık Kiralama A.Ş.
The Company, whose field of activity is financial leasing within the country and abroad started its business in 1988. The Company’s shares are traded in
the Borsa İstanbul A.Ş.
The purpose of the Company, which is founded in September 20, 2019, is to issue lease certificates exclusively within the framework of the Capital
Market Law and related legislation
İş Gayrimenkul Yatırım Ortaklığı A.Ş.
The Company, whose main field of activity is investing in real estate, capital market instruments backed by real estate, real estate projects and capital
market instruments, is conducting its business in the sector as a real estate investment trust since 1999. The Company’s shares are traded in the Borsa
İstanbul A.Ş. since its establishment.
İş Girişim Sermayesi Yatırım Ortaklığı A.Ş.
The Company, which started its venture capital business in the year 2000, aims to make long term investments in venture capital firms which
established or to be founded in Turkey, have potential development and need resources. The Company’s shares are traded in the Borsa İstanbul A.Ş.
since the year 2004.
Existing or Potential, Actual or Legal Obstacles on the Transfer of Shareholders’ Equity between the Parent Bank and its Subsidiaries
or the Reimbursement of Liabilities
VII.
None.
VIII. Written Policies on Assessment of Ensuring Compliance on Market Discipline, Disclosure Obligations, Frequency and Accuracy of
the Related Disclosures
The Parent Bank has written policies on assessment of ensuring compliance on market discipline, disclosure obligations, frequency and accuracy of
related disclosures. The mentioned policies which are agreed by Board of Directors can be obtained from the Parent Bank’s website.
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 312 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 313
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Consolidated Balance Sheet (Statement Of Financial Position)
Consolidated Balance Sheet (Statement Of Financial Position)
SECTION TWO: CONSOLIDATED FINANCIAL STATEMENTS
ASSETS
FINANCIAL ASSETS (NET)
Cash and Cash Equivalents
Cash and Balances with Central Bank
Banks
Money Market Placements
Expected Credit Loss (-)
Foot
notes
V-I-a
V-I-ç
THOUSAND TL
CURRENT PERIOD
(31/12/2022)
PRIOR PERIOD
(31/12/2021)
TL
FC
Total
TL
FC
Total
191.469.562
310.657.416
502.126.978
92.697.746
278.601.171
371.298.917
35.067.358
211.798.542
246.865.900
23.200.606
198.923.187
222.123.793
21.718.599
180.127.300
201.845.899
17.295.382
166.725.843
184.021.225
7.187.687
6.195.342
34.270
31.807.128
38.994.815
2.974.478
32.220.764
35.195.242
0
6.195.342
2.948.099
135.886
170.156
17.353
44.965
68.385
2.993.064
85.738
Financial Assets at Fair Value Through Profit or Loss
V-I-b
23.469.599
10.105.253
33.574.852
5.768.364
8.712.674
14.481.038
Government Debt Securities
Equity Securities
Other Financial Assets
Financial Assets at Fair Value Through Other
Comprehensive Income
Government Debt Securities
Equity Securities
Other Financial Assets
711.666
9.566.112
10.277.778
11.873.519
10.884.414
334.381
204.760
12.207.900
11.089.174
519.471
2.365.686
2.883.207
6.017.710
460.774
2.234.190
6.537.181
2.826.460
5.117.397
V-I-d
132.318.883
69.806.694
202.125.577
62.974.176
46.969.483
109.943.659
129.555.447
64.099.567
193.655.014
61.246.085
39.819.974
101.066.059
258.517
2.504.919
1.342.084
4.365.043
1.600.601
6.869.962
264.898
1.463.193
668.883
6.480.626
933.781
7.943.819
Derivative Financial Assets
V-I-c-i
613.722
18.946.927
19.560.649
754.600
23.995.827
24.750.427
Derivative Financial Assets at Fair Value Through Profit
or Loss
Derivative Financial Assets at Fair Value Through Other
Comprehensive Income
Financial Assets Measured at Amortised Cost
(Net)
Loans
Lease Receivables
Factoring Receivables
Other Financial Assets Measured at Amortised
Cost (Net)
Government Debt Securities
Other Financial Assets
Expected Credit Loss (-)
613.722
18.946.927
19.560.649
754.600
23.995.827
24.750.427
0
0
0
0
0
0
586.224.751
393.104.327
979.329.078
326.322.483
307.111.279
633.433.762
V-I-e
502.248.199
375.845.283
878.093.482
292.585.111
302.937.054
595.522.165
V-I-e-ı
V-I-e
4.961.490
13.400.104
18.361.594
3.642.540
8.682.657
12.325.197
13.696.739
2.211.918
15.908.657
5.097.842
1.797.516
6.895.358
V-I-f
91.311.985
15.644.176
106.956.161
45.055.046
6.490.282
51.545.328
90.427.061
9.829.112
100.256.173
44.872.603
3.103.354
47.975.957
884.924
5.815.064
6.699.988
182.443
3.386.928
3.569.371
25.993.662
13.997.154
39.990.816
20.058.056
12.796.230
32.854.286
ASSETS HELD FOR SALE AND DISCONTINUED
OPERATIONS (Net)
V-I-n
1.598.635
20.359
1.618.994
888.883
Held for Sale
Discontinued Operations
EQUITY INVESTMENTS
Investments in Associates (Net)
V-I-g
Associates Accounted by using Equity Method
Unconsolidated Associates
Subsidiaries (Net)
1.598.635
20.359
1.618.994
888.883
0
0
0
0
42.680.123
190.321
42.870.444
21.918.409
405.345
385.225
20.120
0
0
0
405.345
385.225
20.120
316.851
280.196
36.655
Unconsolidated Financial Subsidiaries
0
0
0
0
Unconsolidated Non-Financial Subsidiaries
42.258.868
190.321
42.449.189
21.593.954
V-I-ğ
42.258.868
190.321
42.449.189
21.593.954
Joint Ventures (Net)
Joint Ventures Accounted by using Equity Method
Unconsolidated Joint Ventures
TANGIBLE ASSETS (Net)
INTANGIBLE ASSETS (Net)
Goodwill
Other
V-I-h
V-I-j
V-I-k
15.910
0
15.910
24.107.773
3.880.370
27.994
0
0
0
15.910
0
15.910
370.345
199.443
24.478.118
4.079.813
0
27.994
3.852.376
199.443
4.051.819
INVESTMENT PROPERTY (Net)
V-I-l
11.320.190
0
11.320.190
7.604
0
7.604
11.131.311
2.014.282
27.994
1.986.288
4.601.916
60.343
580.561
21.988
21.988
0
0
0
0
0
0
0
0
0
0
0
275.713
167.743
0
167.743
0
14.476
910.871
910.871
0
21.918.409
316.851
280.196
36.655
21.593.954
0
21.593.954
7.604
0
7.604
11.407.024
2.182.025
27.994
2.154.031
4.601.916
74.819
2.538.415
3.118.976
CURRENT TAX ASSET
DEFERRED TAX ASSET
OTHER ASSETS
TOTAL ASSETS
V-I-m
V-I-o
16.486
963.685
9.868
10.425
26.354
974.110
132.660.097
15.947.393
148.607.490
62.506.945
12.950.409
75.457.354
994.921.672
720.509.897
1.715.431.569
522.722.879
601.681.194
1.124.404.073
I.
1.1
1.1.1
1.1.2
1.1.3
1.1.4
1.2
1.2.1
1.2.2
1.2.3
1.3
1.3.1
1.3.2
1.3.3
1.4
1.4.1
1.4.2
II.
2.1
2.2
2.3
2.4
2.4.1
2.4.2
2.5
III.
3.1
3.2
IV.
4.1
4.1.1
4.1.2
4.2
4.2.1
4.2.2
4.3
4.3.1
4.3.2
V.
VI.
6.1
6.2
VII.
VIII.
IX.
X.
LIABILITIES
DEPOSITS
FUNDS BORROWED
MONEY MARKETS
Foot
notes
V-II-a
V-II-c
THOUSAND TL
CURRENT PERIOD
(31/12/2022)
PRIOR PERIOD
(31/12/2021)
TL
FC
Total
TL
FC
Total
381.017.089
571.618.843
952.635.932
165.520.943
452.158.260
617.679.203
12.101.494
143.880.105
155.981.599
6.019.498
122.904.185
128.923.683
37.777.875
13.462.281
51.240.156
42.829.398
10.908.455
53.737.853
SECURITIES ISSUED (Net)
V-II-ç
11.523.746
46.820.814
58.344.560
8.784.977
39.292.335
48.077.312
Bills
Asset Backed Securities
Bonds
FUNDS
Borrower Funds
Other
FİNANCIAL LIABILITIES AT FAIR VALUE THROUGH
PROFIT OR LOSS
DERIVATIVE FINANCIAL LIABILITIES
Derivative Financial Liabilities at Fair Value Through
Profit or Loss
Derivative Financial Liabilities at Fair Value Through
Other Comprehensive Income
FACTORING PAYABLES
LEASE PAYABLES (Net)
PROVISIONS
Restructuring Provisions
Reserve for Employee Benefits
V-II-
b-g
V-II-f
V-II-ğ
10.463.791
164.426
0
0
10.463.791
5.999.193
164.426
757.078
0
0
5.999.193
757.078
895.529
46.820.814
47.716.343
2.028.706
39.292.335
41.321.041
27.907
27.907
0
0
709.826
709.826
737.733
737.733
0
0
0
0
11.191
11.191
0
0
680.513
680.513
691.704
691.704
0
0
0
0
3.060.665
7.030.436
10.091.101
7.097.196
6.981.331
14.078.527
3.060.665
7.030.436
10.091.101
7.097.196
6.981.331
14.078.527
0
0
0
0
0
0
0
0
0
0
0
0
1.326.947
316.106
1.643.053
983.934
255.780
1.239.714
54.155.322
13.137.153
67.292.475
27.864.420
7.744.897
35.609.317
0
0
0
0
0
0
5.886.941
6.798
5.893.739
2.572.040
4.391
2.576.431
Insurance Technical Provisions (Net)
23.985.529
11.602.637
35.588.166
12.951.315
6.572.513
19.523.828
Other Provisions
CURRENT TAX LIABILITY
DEFERRED TAX LIABILITY
LIABILITIES RELATED TO ASSETS HELD FOR SALE
AND DISCONTINUED OPERATIONS
Held for Sale
Discontinued Operations
SUBORDINATED DEBT
Loans
Other Debt Instruments
OTHER LIABILITIES
SHAREHOLDERS' EQUITY
Paid-in capital
Capital Reserves
Share Premium
Share Cancellation Profits
Other Capital Reserves
Accumulated Other Comprehensive Income or Loss
Not Reclassified Through Profit or Loss
Accumulated Other Comprehensive Income or Loss
Reclassified Through Profit or Loss
Profit Reserves
Legal Reserves
Status Reserves
Extraordinary Reserves
Other Profit Reserves
Profit or Loss
Prior Periods' Profit or Loss
Current Period Profit or Loss
Minority Shares
24.282.852
1.527.718
25.810.570
12.341.065
1.167.993
13.509.058
V-II-h
V-II-h
V-II-ı
8.077.499
1.599.383
0
0
0
48.488
0
0
0
0
8.125.987
1.599.383
2.537.054
120.438
24.082
4.511
2.561.136
124.949
0
0
0
0
0
0
0
0
0
0
0
0
V-II-i
2.277.824
31.280.921
33.558.745
2.296.445
39.182.832
41.479.277
0
0
0
0
0
0
2.277.824
31.280.921
33.558.745
2.296.445
39.182.832
41.479.277
V-II-e
V-II-j
143.167.968
20.960.184
164.128.152
74.142.355
9.890.864
84.033.219
213.719.591
-3.666.898
210.052.693
98.923.927
-2.755.748
96.168.179
10.000.000
1.218.092
138.551
0
1.079.541
0
0
0
0
0
10.000.000
4.500.000
1.218.092
1.203.468
138.551
143.633
0
0
1.079.541
1.059.835
0
0
0
0
0
4.500.000
1.203.468
143.633
0
1.059.835
20.231.121
-429
20.230.692
8.054.093
100
8.054.193
44.402.975
-4.867.474
39.535.501
11.320.953
-3.031.910
8.289.043
58.255.995
539.625
58.795.620
51.379.015
7.063.017
289.294
28.268
0
7.091.285
289.294
5.832.370
225.558
4.619
1.930
0
51.383.634
5.834.300
225.558
50.903.684
511.357
51.415.041
45.321.087
2.689
45.323.776
0
60.681.842
-10.877
60.692.719
0
789.181
-116.770
905.951
0
0
61.471.023
13.085.039
-127.647
-263.478
61.598.670
13.348.517
0
417.874
225.331
192.543
0
13.502.913
-38.147
13.541.060
V-II-k
18.929.566
-127.801
18.801.765
9.381.359
-146.431
9.234.928
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
869.833.310
845.598.259
1.715.431.569
437.131.776
687.272.297
1.124.404.073
I.
II.
III.
IV.
4.1
4.2
4.3
V.
5.1
5.2
VI.
VII.
7.1
7.2
VIII.
IX.
X.
10.1
10.2
10.3
10.4
XI.
XII.
XIII.
13.1
13.2
XIV.
14.1
14.2
XV.
XVI.
16.1
16.2
16.2.1
16.2.2
16.2.3
16.3
16.4
16.5
16.5.1
16.5.2
16.5.3
16.5.4
16.6
16.6.1
16.6.2
16.7
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen
314 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 315
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Consolidated Statement of Off-Balance Sheet Items
Consolidated Statement of Off-Balance Sheet Items
Foot
notes
CURRENT PERIOD
(31/12/2022)
PRIOR PERIOD
(31/12/2021)
TL
FC
Total
TL
FC
Total
THOUSAND TL
A. OFF-BALANCE SHEET CONTINGENCIES and
COMMITMENTS (I+II+III)
486.977.283
950.378.400
1.437.355.683
302.695.310
836.880.350
1.139.575.660
GUARANTEES AND SURETYSHIPS
V-III
91.557.242
158.958.679
250.515.921
46.412.927
153.202.866
199.615.793
Letters of Guarantee
85.483.077
95.269.548
180.752.625
46.048.608
86.618.355
132.666.963
Guarantees Subject to State Tender Law
1.344.063
1.143.615
2.487.678
865.540
764.138
1.629.678
Guarantees Given for Foreign Trade Operations
11.143.447
40.340.109
51.483.556
4.204.824
46.612.126
50.816.950
Other Letters of Guarantee
Bank Acceptances
Import Letter of Acceptance
Other Bank Acceptances
Letters of Credit
Documentary Letters of Credit
Other Letters of Credit
Prefinancing Given as Guarantee
Endorsements
Endorsements to the Central Bank of Turkey
Other Endorsements
Purchase Guarantees for Securities Issued
Factoring Guarantees
Other Guarantees
Other Suretyships
COMMITMENTS
Irrevocable Commitments
Forward Asset Purchase Commitments
Forward Deposit Purchase and Sales Commitments
Capital Commitments to Associates and Subsidiaries
Loan Granting Commitments
Securities Underwriting Commitments
Commitments for Reserve Deposit Requirements
Commitments for Cheque Payments
Tax and Fund Liabilities from Export Commitments
Commitments for Credit Card Expenditure Limits
Commitments for Credit Cards and Banking Services
Promotions
Receivables from Short Sale Commitments
Payables for Short Sale Commitments
Other Irrevocable Commitments
Revocable Commitments
Revocable Loan Granting Commitments
Other Revocable Commitments
72.995.567
53.785.824
126.781.391
40.978.244
39.242.091
80.220.335
5.576.890
2.476.617
8.053.507
111.350
13.694.523
13.805.873
0
5.576.890
492.132
455.314
704.717
1.771.900
704.717
7.348.790
0
582.983
582.983
111.350
13.111.540
13.222.890
56.376.383
56.868.515
244.637
48.629.112
48.873.749
36.316.518
36.771.832
36.818
20.059.865
20.096.683
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
191.272
53.365
34.944.022
35.135.294
13.685.090
13.738.455
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
5.143
4.836.131
4.841.274
8.332
4.260.876
4.269.208
0
0
0
0
0
0
197.736.666
40.558.403
238.295.069
101.316.731
55.685.820
157.002.551
194.762.484
22.659.219
217.421.703
99.221.331
36.748.294
135.969.625
55.113
4.658.659
4.713.772
9.373.110
18.354.232
27.727.342
0
1.000.000
65.197.193
0
0
5.447.537
22.490
112.111.363
277.375
0
0
0
0
138.750
1.138.750
0
0
0
0
157.380
157.380
2.105.370
67.302.563
34.174.955
1.702.867
35.877.822
0
0
0
0
0
0
0
0
0
0
0
0
5.447.537
3.291.900
22.490
41.377
112.111.363
46.524.830
277.375
208.406
0
0
0
0
0
0
0
0
0
0
0
0
0
0
3.291.900
41.377
46.524.830
208.406
0
0
10.651.413
15.756.440
26.407.853
5.606.753
16.533.815
22.140.568
2.974.182
2.939.182
35.000
17.899.184
20.873.366
2.095.400
18.937.526
21.032.926
17.899.184
20.838.366
2.045.400
18.937.526
20.982.926
0
35.000
50.000
0
50.000
DERIVATIVE FINANCIAL INSTRUMENTS
197.683.375
750.861.318
948.544.693
154.965.652
627.991.664
782.957.316
Derivative Financial Instruments Held for Risk
Management
Fair Value Hedges
Cash Flow Hedges
Net Foreign Investment Hedges
0
0
0
0
26.497.037
26.497.037
26.497.037
26.497.037
0
0
0
0
0
0
0
0
27.012.103
27.012.103
27.012.103
27.012.103
0
0
0
0
I.
1.1
1.1.1
1.1.2
1.1.3
1.2
1.2.1
1.2.2
1.3
1.3.1
1.3.2
1.4
1.5
1.5.1
1.5.2
1.6
1.7
1.8
1.9
II.
2.1
2.1.1
2.1.2
2.1.3
2.1.4
2.1.5
2.1.6
2.1.7
2.1.8
2.1.9
2.1.10
2.1.11
2.1.12
2.1.13
2.2
2.2.1
2.2.2
III.
3.1
3.1.1
3.1.2
3.1.3
Foot
notes
CURRENT PERIOD
(31/12/2022)
PRIOR PERIOD
(31/12/2021)
TL
FC
Total
TL
FC
Total
THOUSAND TL
Derivative Financial Instruments Held for Trading
197.683.375
724.364.281
922.047.656
154.965.652
600.979.561
755.945.213
Forward Foreign Currency Buy/Sell Transactions
10.640.362
58.699.042
69.339.404
15.504.070
58.953.279
74.457.349
Forward Foreign Currency Buy Transactions
Forward Foreign Currency Sell Transactions
Currency and Interest Rate Swaps
Currency Swap Buy Transactions
Currency Swap Sell Transactions
Interest Rate Swap Buy Transactions
Interest Rate Swap Sell Transactions
Currency, Interest Rate and Security Options
Currency Call Options
Currency Put Options
Interest Rate Call Options
Interest Rate Put Options
Securities Call Options
Securities Put Options
Currency Futures
Currency Buy Futures
Currency Sell Futures
Interest Rate Futures
Interest Rate Buy Futures
Interest Rate Sell Futures
Other
9.117.920
25.804.206
34.922.126
11.384.803
25.669.590
37.054.393
1.522.442
32.894.836
34.417.278
4.119.267
33.283.689
37.402.956
172.439.374
579.101.581
751.540.955
127.095.137
489.865.606
616.960.743
14.912.056
201.323.125
216.235.181
9.433.744
177.256.130
186.689.874
155.910.430
85.151.884
241.062.314
116.999.171
81.523.710
198.522.881
808.444
808.444
146.313.286
146.313.286
6.223.543
23.979.673
3.160.239
2.560.163
0
0
102.031
401.110
1.468.797
531.608
937.189
0
0
0
8.188.384
8.138.756
3.822.162
3.822.162
8.209
0
2.388.511
1.878.869
509.642
0
0
0
147.121.730
147.121.730
30.203.216
11.348.623
10.698.919
3.822.162
3.822.162
110.240
401.110
3.857.308
2.410.477
1.446.831
0
0
0
331.111
331.111
8.943.556
4.557.856
4.026.900
115.542.883
115.873.994
115.542.883
115.873.994
21.274.918
6.309.858
30.218.474
10.867.714
6.553.948
10.580.848
0
0
4.205.556
4.205.556
36.407
322.393
760.477
40.052
720.425
0
0
0
0
0
1.540.698
1.481.995
58.703
0
0
0
4.205.556
4.205.556
36.407
322.393
2.301.175
1.522.047
779.128
0
0
0
6.911.299
60.195.474
67.106.773
2.662.412
29.345.060
32.007.472
3.2
3.2.1
3.2.1.1
3.2.1.2
3.2.2
3.2.2.1
3.2.2.2
3.2.2.3
3.2.2.4
3.2.3
3.2.3.1
3.2.3.2
3.2.3.3
3.2.3.4
3.2.3.5
3.2.3.6
3.2.4
3.2.4.1
3.2.4.2
3.2.5
3.2.5.1
3.2.5.2
3.2.6
B. CUSTODY AND PLEDGES RECEIVED (IV+V+VI)
1.116.249.656
1.495.889.698
2.612.139.354
796.887.897
993.775.709
1.790.663.606
IV.
4.1
4.2
4.3
4.4
4.5
4.6
4.7
4.8
V.
5.1
5.2
5.3
5.4
5.5
5.6
5.7
VI.
ITEMS HELD IN CUSTODY
Customers' Securities Held
Investment Securities Held in Custody
Cheques Received for Collection
126.082.554
177.367.218
303.449.772
101.820.670
125.221.499
227.042.169
0
0
0
0
0
0
73.694.920
9.302.513
82.997.433
73.423.758
8.234.913
81.658.671
46.921.949
93.195.648
140.117.597
24.886.014
68.776.278
93.662.292
Commercial Notes Received for Collection
3.969.225
36.196.124
40.165.349
2.994.936
26.962.386
29.957.322
Other Assets Received for Collection
Assets Received for Public Offering
Other Items Under Custody
Custodians
PLEDGED ITEMS
Marketable Securities
Guarantee Notes
Commodity
Warranty
Real Estates
Other Pledged Items
Pledged Items-Depository
ACCEPTED BILL, GUARANTEES AND SURETIES
TOTAL OFF-BALANCE SHEET COMMITMENTS
(A+B)
0
0
0
0
0
0
0
0
0
0
0
0
1.496.460
38.672.933
40.169.393
515.962
21.247.922
21.763.884
0
0
0
0
0
0
1.195.674.627
2.329.723.738
3.525.398.365
818.808.243
1.504.428.098
2.323.236.341
70.796.111
214.601.746
285.397.857
55.405.889
148.526.695
203.932.584
22.783.627
73.150.399
95.934.026
15.393.327
58.309.803
73.703.130
261.292.144
230.129.478
491.421.622
167.725.673
118.466.297
286.191.970
0
0
0
0
0
0
612.933.020
1.140.910.774
1.753.843.794
407.968.742
739.657.751
1.147.626.493
227.869.725
670.931.341
898.801.066
172.314.612
439.467.552
611.782.164
0
0
0
0
0
0
0
0
0
0
0
0
1.808.734.464
3.457.469.356
5.266.203.820 1.223.324.223
2.466.529.947
3.689.854.170
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen
316 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 317
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Consolidated Statement of Profit or Loss
Consolidated Statement of Profit or Loss and
Other Comprehensive Income
STATEMENT OF PROFIT OR LOSS
INTEREST INCOME
Interest Income on Loans
Interest Income on Reserve Deposits
Interest Income on Banks
Interest Income on Money Market Placements
Interest Income on Marketable Securities Portfolio
Financial Assets At Fair Value Through Profit or Loss
Financial Assets At Fair Value Through Other Comprehensive Income
Financial Assets At Measured at Amortised Cost
Financial Lease Income
Other Interest Income
INTEREST EXPENSE (-)
Interest on Deposits
Interest on Funds Borrowed
Interest on Money Market Funds
Interest on Securities Issued
Financial Lease Expense
Other Interest Expenses
NET INTEREST INCOME (I - II)
NET FEES AND COMMISSIONS INCOME
Fees and Commissions Received
Non-cash Loans
Other
Fees and Commissions Paid
Non-cash Loans
Other
DIVIDEND INCOME
TRADING INCOME /(LOSS) (Net)
Gains/(Losses) on Securities Trading
Derivative Financial Transactions Gains/Losses
Foreign Exchange Gains / (Losses)
OTHER OPERATING INCOME
GROSS OPERATING INCOME (III+IV+V+VI+VII)
EXPECTED CREDIT LOSS (-)
OTHER PROVISION EXPENSES (-)
PERSONNEL EXPENSE (-)
OTHER OPERATING EXPENSES (-)
NET OPERATING INCOME/(LOSS) (VIII-IX-X-XI-XII)
AMOUNT IN EXCESS RECORDED AS GAIN AFTER MERGER
PROFIT/LOSS FROM ASSOCIATES ACCOUNTED FOR USING THE EQUITY METHOD
NET MONETARY POSITION GAIN/LOSS
PROFIT/LOSS ON CONTINUING OPERATIONS BEFORE TAX (XIII+...+XVI)
TAX PROVISION FOR CONTINUING OPERATIONS (±)
Current Tax Provision
Deferred Tax Income Effect (+)
Deferred Tax Expense Effect (-)
NET PERIOD PROFIT/LOSS FROM CONTUNUING OPERATIONS (XVI±XVII)
INCOME ON DISCONTINUED OPERATIONS
Income on Assets Held for Sale
Gain on Sale of Associates, Subsidiaries and Jointly Controlled Entities (Joint Ventures)
Other Income on Discontinued Operations
EXPENSE ON DISCONTINUED OPERATIONS (-)
Expense on Assets Held for Sale
Loss on Sale of Associates, Subsidiaries and Jointly Controlled Entities (Joint Ventures)
Other Expense on Discontinued Operations
PROFIT/LOSS ON DISCONTINUED OPERATIONS BEFORE TAX (XX-XXI)
TAX PROVISION FOR DISCONTINUED OPERATIONS (±)
Current Tax Provision
Deferred Tax Expense Effect (+)
Deferred Tax Income Effect (-)
NET PERIOD PROFIT/LOSS FROM DISCONTINUED OPERATIONS (XXII±XXIII)
NET PERIOD PROFIT/LOSS (XIX+XXIV)
Group's Profit / Loss
Non-controlling Interest Profit / Loss (-)
Earnings per Share (*)
Foot
notes
V-IV-a
V-IV-b
V-IV-c
V-IV-ç
V-IV-d
V-IV-e
V-IV-e
V-IV-f
V-IV-g
V-IV-ğ
V-IV-h
V-IV-g
V-IV-ğ
V-IV-h
V-IV-ı
I.
1.1
1.2
1.3
1.4
1.5
1.5.1
1.5.2
1.5.3
1.6
1.7
II.
2.1
2.2
2.3
2.4
2.5
2.6
III.
IV.
4.1
4.1.1
4.1.2
4.2
4.2.1
4.2.2
V.
VI.
6.1
6.2
6.3
VII.
VIII.
IX.
X.
XI.
XII.
XIII.
XIV.
XV.
XVI.
XVII.
XVIII.
18.1
18.2
18.3
XIX.
XX.
20.1
20.2
20.3
XXI.
21.1
21.2
21.3
XXII.
XXIII.
23.1
23.2
23.3
XXIV.
XXV.
25.1
25.2
(*) Expressed in exact TL.
THOUSAND TL
CURRENT PERIOD
(01/01-31/12/2022)
PRIOR PERIOD
(01/01-31/12/2021)
THOUSAND TL
CURRENT PERIOD
(01/01-31/12/2022)
PRIOR PERIOD
(01/01-31/12/2021)
I.
II.
2.1
2.1.1
2.1.2
2.1.3
2.1.4
2.1.5
2.2
2.2.1
2.2.2
2.2.3
2.2.4
2.2.5
2.2.6
III.
PROFIT/LOSS FOR THE PERIOD
OTHER COMPREHENSIVE INCOME
Other comprehensive income that will not be reclassified to profit or loss
Revaluation Surplus on Tangible Assets
Revaluation Surplus on Intangible Assets
Gains/(Losses) on remeasurements of Defined Benefit Plans
Other Income/Expense Items of Other Comprehensive Income not to be Reclassified to
Profit Or Loss
Taxes Relating To Components Of Other Comprehensive Income not to be Reclassified To
Profit Or Loss
Other Income/Expense Items not be Reclassified to Profit or Loss
Exchange Differences on Translation
Valuation and/or Reclassification Profit or Loss from Financial Assets at Fair Value
through Other Comprehensive Income
Income/(Loss) Related with Cash Flow Hedges
Income/(Loss) Related with Hedges of Net Investments in Foreign Operations
Other Income/Expense Items of Other Comprehensive Income to be Reclassified
to Other Profit or Loss
Taxes Relating To Components Of Other Comprehensive Income to be Reclassified
To Profit Or Loss
TOTAL COMPREHENSIVE INCOME (I+II)
69.057.682
45.775.586
13.867.929
11.710.234
0
-2.718.358
5.265.037
-388.984
31.907.657
2.141.102
33.631.708
0
0
4.492.270
-8.357.423
114.833.268
15.560.258
7.207.376
3.824.663
2.692.577
0
-732.441
1.888.340
-23.813
3.382.713
1.796.559
-1.414.575
0
0
2.760.779
239.950
22.767.634
140.591.973
88.814.283
284.989
1.192.676
1.235.823
45.597.027
295.244
26.924.548
18.377.235
1.656.789
1.810.386
54.160.597
32.510.139
5.536.809
4.642.178
8.236.025
247.662
2.987.784
86.431.376
14.671.415
22.118.215
2.329.047
19.789.168
7.446.800
40.129
7.406.671
263.526
19.477.788
10.507.138
-10.163.186
19.133.836
32.573.886
153.417.991
13.055.945
6.175.130
17.710.092
42.171.552
74.305.272
0
10.205.448
0
84.510.720
15.453.038
20.565.318
2.936.091
8.048.371
69.057.682
0
0
0
0
0
0
0
0
0
0
0
0
0
0
69.057.682
61.598.670
7.459.012
0,246392462
69.449.187
48.414.707
850.107
686.021
401.957
17.499.167
168.216
10.801.345
6.529.606
887.340
709.888
32.530.364
18.048.238
2.612.115
5.396.609
6.048.417
163.612
261.373
36.918.823
6.691.855
10.490.764
1.327.072
9.163.692
3.798.909
12.754
3.786.155
68.548
703.452
1.882.678
-179.759
-999.467
16.883.690
61.266.368
12.667.759
4.142.731
7.715.533
22.665.876
14.074.469
0
4.874.850
0
18.949.319
3.389.061
2.621.921
3.774.382
3.007.242
15.560.258
0
0
0
0
0
0
0
0
0
0
0
0
0
0
15.560.258
13.541.060
2.019.198
0,054163753
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İşbank 2022 Integrated Annual Report 319
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Consolidated Statement Of Changes In Shareholders’ Equity
Consolidated Statement Of Changes In Shareholders’ Equity
CHANGES IN SHAREHOLDERS’ EQUITY
Foot
notes
Paid-in
Capital
Share
Premium
Accumulated Other Comprehensive Income
That will not be Reclassified in Profit/(Loss)
Accumulated Other Comprehensive Income
That will be Reclassified in Profit/(Loss)
Share
Certificate
Cancellation
Profits
Other
Capital
Reserves
Tangible
assets
accumulated
revaluation
reserve
Increase /
(Decrease)
Accumulated
gains/
(losses) on
remeasurements
of defined
benefit plans
Other (1)
Exchange
differences on
translation reserve
Accumulated gains/
(losses) due to
revaluation and/
or reclassification
of financial assets
measured at fair
value through other
comprehensive
income
Profit
Reserves
Prior Period
Profit/(Loss)
Net Current
Period Profit/
(Loss)
Other (2)
Total
Shareholders'
Equity Except
Non-
controlling
Interest
Non-
controlling
Interest
Total
Shareholder's
Equity
V-V
PRIOR PERIOD ( 31/12/2021)
Beginning Balance
Adjustment in accordance with TAS 8
The Effect of Adjustments
The Effect of Changes in Accounting Policies
New Balance (I+II)
Total Comprehensive Income
Capital Increase in Cash
Capital Increase Through Internal Reserves
Paid-in-Capital inflation adjustment
difference
Convertible Bonds
Subordinated Debt
Increase/(Decrease) Through Other
Changes (*)
Profit Distribution
Dividend Paid
Transfer to Reserves
Other (**)
4.500.000
124.549
1.091.758
3.508.193
(303.280)
1.444.996
2.066.912
1.285.771
1.285.388
44.064.828
8.378.887
67.448.002
7.413.718
74.861.720
4.500.000
124.549
1.091.758
3.508.193
(303.280)
1.444.996
2.085.048
(579.952)
1.888.340
2.066.912
1.794.485
1.285.771
1.285.388
44.064.828
8.378.887
67.448.002
7.413.718
74.861.720
(902.173)
2.757.991
13.541.060
20.584.799
2.182.835
22.767.634
19.084
(31.923)
10.816
32
18
651
22.664
(340.005)
(318.663)
(70.178)
(388.841)
7.296.142
(8.077.029)
(661.415)
7.281.290
(7.281.290)
14.852
(134.324)
(780.887)
(661.415)
(291.447)
(1.072.334)
(299.226)
(960.641)
(119.472)
7.779
(111.693)
Ending Balance (III+IV+…...+X+XI)
4.500.000
143.633
-
1.059.835
5.604.057
(883.232)
3.333.368
3.861.415
384.249
4.043.379
51.383.634
(38.147)
13.541.060
86.933.251
9.234.928
96.168.179
CURRENT PERIOD ( 31/12/2022)
Beginning Balance
Adjustment in accordance with TAS 8
The Effect of Adjustments
The Effect of Changes in Accounting Policies
New Balance (I+II)
Total Comprehensive Income
Capital Increase in Cash
4.500.000
143.633
1.059.835
5.604.057
(883.232)
3.333.368
3.861.415
384.249
4.043.379
51.383.634
13.502.913
86.933.251
9.234.928
96.168.179
4.500.000
143.633
1.059.835
5.604.057
(883.232)
3.333.368
8.866.109
(1.950.954)
5.266.266
3.861.415
2.137.596
384.249
4.043.379
51.383.634
13.502.913
86.933.251
9.234.928
96.168.179
24.630.342
4.478.519
61.598.670
105.026.548
9.806.720
114.833.268
Capital Increase Through Internal Reserves
5.500.000
(5.500.000)
Paid-in-Capital inflation adjustment
difference
Convertible Bonds
Subordinated Debt
Increase/(Decrease) Through Other
Changes (*)
Profit Distribution
Dividend Paid
Transfer to Reserves
Other (**)
(5.082)
19.706
(4.916)
(6)
1
425.707
152.261
587.671
(16.876)
570.795
12.486.279
(13.782.821)
(1.296.542)
(223.007)
(1.519.549)
(1.307.884)
(1.307.884)
(226.322)
(1.534.206)
12.474.937
(12.474.937)
11.342
11.342
3.315
14.657
I.
II.
2.1
2.2
III.
IV.
V.
VI.
VII.
VIII.
IX.
X.
XI.
11.1
11.2
11.3
I.
II.
2.1
2.2
III.
IV.
V.
VI.
VII.
VIII.
IX.
X.
XI.
11.1
11.2
11.3
Ending Balance (III+IV+…...+X+XI)
10.000.000
138.551
-
1.079.541
14.465.250
(2.834.186)
8.599.628
5.999.012
25.014.591
8.521.898
58.795.620
-127.647
61.598.670
191.250.928
18.801.765
210.052.693
(1) Other Comprehensive Income of Associates and Joint Ventures Accounted for Using Equity Method that will not be Reclassified to Profit or Loss and Other Accumulated Amounts of Other Comprehensive
Income that will not be Reclassified to Profit or Loss.
(2) Accumulated gains/(losses) on cash flow hedges, Other Comprehensive Income of Associates and Joint Ventures Accounted for using equity method that will be classified to Profit/(Loss), Other Accumulated
Amounts of Other Comprehensive Income that will be Reclassified to Profit or Loss
(*) Includes changes in the Group Shares.
(**) In accordance with TMS 19 "Benefits to Employees", the provisions allocated in the relevant period for the dividend to be distributed to the personnel were added to the distributable profit figure. In the prior
period, the amount of dividends distributed to bank personnel according to the main contract of the Parent Bank is also included.
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen
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İşbank 2022 Integrated Annual Report 321
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Consolidated Statement of Cash Flows
Consolidated Statement of Profit Distribution Table
Foot
notes
THOUSAND TL
CURRENT PERIOD
(01/01-31/12/2022)
PRIOR PERIOD
(01/01-31/12/2021)
THOUSAND TL
CURRENT PERIOD
(01/01-31/12/2022)
PRIOR PERIOD
(01/01-31/12/2021)
A.
1.1
1.1.1
1.1.2
1.1.3
1.1.4
1.1.5
1.1.6
1.1.7
1.1.8
1.1.9
1.2
1.2.1
1.2.2
1.2.3
1.2.4
1.2.5
1.2.6
1.2.7
1.2.8
1.2.9
CASH FLOWS FROM BANKING OPERATIONS
Operating Profit Before Changes in Operating Assets and Liabilities
Interest Received
Interest Paid
Dividend Received
Fees and Commissions Received
Other Income
Collections from Previously Written Off Loans and Other Receivables
Cash Payments to Personnel and Service Suppliers
Taxes Paid
Other
Changes in Operating Assets and Liabilities
Net (Increase) / Decrease in Financial Assets at Fair Value Through Profit or Loss
V-VI
Net (Increase) / Decrease in Due From Banks
Net (Increase) / Decrease in Loans
Net (Increase) / Decrease in Other Assets
Net Increase / (Decrease) in Bank Deposits
Net Increase / (Decrease) in Other Deposits
Net Increase/ (Decrease) in Financial Liabilities at Fair Value Through Profit or Loss
Net Increase / (Decrease) in Funds Borrowed
Net Increase / (Decrease) in Matured Payables
1.2.10
Net Increase / (Decrease) in Other Liabilities
V-VI
I.
B.
II.
2.1
2.2
2.3
2.4
2.5
2.6
2.7
2.8
2.9
C.
III.
3.1
3.2
3.3
3.4
3.5
3.6
IV.
V.
VI.
VII.
Net Cash Provided From Banking Operations
CASH FLOWS FROM INVESTING ACTIVITIES
Net Cash Provided from Investing Activities
Cash Paid for the Purchase of Associates, Subsidiaries and Jointly Controlled
Entities (Joint Ventures)
Cash Obtained from Sale of Associates, Subsidiaries and Jointly Controlled
Entities (Joint Ventures)
Cash Paid for the Purchase of Tangible Asset
Cash Obtained from the Sale of Tangible Asset
Cash Paid for Purchase of Financial Assets at Fair Value Through Other
Comprehensive Income
Cash Obtained from Sale of Financial Assets at Fair Value Through Other
Comprehensive Income
Cash Paid for Purchase of Financial Assets Measured at Amortised Cost
Cash Obtained from Sale of Financial Assets Measured at Amortised Cost (*)
Other
CASH FLOWS FROM FINANCING ACTIVITIES
Net cash provided from financing activities
Cash obtained from funds borrowed and securities issued
Cash used for repayment of funds borrowed and securities issued
Equity Instruments
Dividends Paid
Payments for Finance Leases
Other
Effect of change in foreign exchange rate on cash and cash equivalents
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of the period
Cash and cash equivalents at end of the period
V-VI
V-VI
V-VI
(*) Includes Redeemed Financial Assets measured at amortized cost.
65.423.795
118.786.745
(49.665.722)
1.040.005
22.118.215
25.750.270
3.590.123
(25.862.712)
(16.911.467)
(13.421.662)
23.009.505
(15.496.512)
(8.121.373)
(187.313.018)
(49.948.337)
(625.735)
236.383.401
0
(15.257.022)
0
63.388.101
88.433.300
24.798.475
61.253.858
(31.171.346)
356.764
10.490.764
8.259.735
3.082.969
(12.745.696)
(4.041.939)
(10.686.634)
79.558.425
(5.146.832)
(12.513.917)
(63.596.525)
(17.844.555)
(1.053.465)
127.371.908
0
3.054.383
0
49.287.428
104.356.900
(77.786.425)
(10.310.109)
(3.689)
0
(2.396.667)
1.387.612
(79.595.524)
44.385.721
(60.382.102)
21.574.387
(2.756.163)
(29.800.559)
48.911.840
(76.093.320)
0
(1.894.206)
(724.873)
0
975.670
(18.178.014)
132.322.602
114.144.588
(5.113)
0
(830.154)
423.335
(44.706.318)
35.474.175
(16.224.952)
16.481.168
(922.250)
(12.728.598)
20.594.682
(31.720.839)
0
(1.094.965)
(507.476)
0
(1.317.136)
80.001.057
52.321.545
132.322.602
I.
1.1
1.2
1.2.1
1.2.2
1.2.3
A.
1.3
1.4
1.5
B.
1.6
1.6.1
1.6.2
1.6.3
1.6.4
1.6.5
1.7
1.8
1.9
1.9.1
1.9.2
1.9.3
1.9.4
1.9.5
1.10
1.11
1.12
1.13
II.
2.1
2.2
2.2.1
2.2.2
2.2.3
2.2.4
2.2.5
2.3
2.4
III.
3.1
3.2
3.3
3.4
IV.
4.1
4.2
4.3
4.4
DISTRIBUTION OF CURRENT YEAR PROFIT (1)
CURRENT PERIOD PROFIT (2)
TAXES AND DUES PAYABLE (-)
Corporate Tax (Income Tax)
Income Tax Withholding
Other Taxes and Dues Payable (3)
NET PROFIT FOR THE PERIOD (1.1-1.2)
PRIOR YEARS’ LOSSES (-)
FIRST LEGAL RESERVES (-)
OTHER STATUTORY RESERVES (-)
NET PROFIT ATTRIBUTABLE TO [(A-(1.3+1.4+1.5)]
FIRST DIVIDEND TO SHAREHOLDERS (-)
To Owners of Ordinary Shares
To Owners of Preferred Shares
To Preferred Shares (Preemptive Rights)
To Profit Sharing Bonds
To Holders of Profit / Loss Share Certificates
DIVIDENDS TO PERSONNEL (-)
DIVIDENDS TO THE BOARD OF DIRECTORS (-)
SECOND DIVIDEND TO SHAREHOLDERS (-)
To Owners of Ordinary Shares
To Owners of Privileged Shares
To Owners of Preferred Shares
To Profit Sharing Bonds
To Holders of Profit / Loss Share Certificates
STATUTORY RESERVES (-)
EXTRAORDINARY RESERVES
OTHER RESERVES
SPECIAL FUNDS
DISTRIBUTION FROM RESERVES
DISTRIBUTED RESERVES
DIVIDENDS TO SHAREHOLDERS (-)
To Owners of Ordinary Shares
To Owners of Privileged Shares
To Owners of Preferred Shares
To Profit Sharing Bonds
To Holders of Profit / Loss Share Certificates
DIVIDENDS TO PERSONNEL (-)
DIVIDENDS TO THE BOARD OF DIRECTORS (-)
EARNINGS PER SHARE
TO OWNERS OF ORDINARY SHARES (4)
TO OWNERS OF ORDINARY SHARES ( % )
TO OWNERS OF PRIVILEGED SHARES (4)
TO OWNERS OF PRIVILEGED SHARES (%)
DIVIDEND PER SHARE
TO OWNERS OF ORDINARY SHARES (4)
TO OWNERS OF ORDINARY SHARES ( % )
TO OWNERS OF PRIVILEGED SHARES (4)
TO OWNERS OF PRIVILEGED SHARES (%)
73.949.048
12.411.168
17.082.925
121.205
(4.792.962)
61.537.880
0
0
0
61.537.880
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0,2461
615
0
0
0
0
0
0
21.250.467
2.007.986
1.057.464
46.314
904.208
19.242.481
0
1.103.071
143.605
17.995.805
270.000
269.998
2
0
0
0
359.481
0
1.076.790
1.076.756
24
10
0
0
0
16.289.534
0
0
0
0
0
0
0
0
0
0
0
0,1197
299
0
0
0,0120
29,93
0,0086
85,87
(1): The decision for dividend payment is made at the Annual General Meeting. Annual General Meeting has not been held as of the reporting date.
(2): In accordance with "TAS 19 Employee Benefits", TL 360.000 allocated for the profit share to be distributed to the personnel in 2021 and added to the profit distribution base of the same year, and TL
5.414.586 retained earnings added to the profit distribution base of the same year are added to the previous period's profit in the table.
(3): Deferred Tax Expense/Income.
(4): Expressed in exact TL.
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen
322 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 323
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
SECTION THREE: EXPLANATION ON ACCOUNTING POLICIES
I.
Basis of Presentationr
The consolidated financial statements, related notes and explanations in this report are prepared in accordance with the “Regulation on Accounting
Applications for Banks and Safeguarding of Documents” and other regulations on accounting records of Banks published by Banking Regulation
and Supervision Agency and circulars and interpretations published by Banking Regulation and Supervision Authority, (together referred as “BRSA
Accounting and Financial Reporting Legislation”) and requirements of Turkish Financial Reporting Standards (TFRS) published the Public Oversight
Accounting and Auditing Standards Authority for the matters not regulated by the aforementioned legislations.
COVID-19 outbreak, which started in China and spread globally in the first half of 2020, caused serious effects on both economic and social life. In
addition to the social life effects of the cautions taken to ensure the control of outbreak in many countries, there are also consequences observed which
is negatively affecting economic activity both on regional and global scale. As in other countries where the pandemic is effective, various cautions also
have been taken in our country in social and economic terms. The Bank sustains its activities with the consolidated companies for the period precisely
by closely monitoring the processes related to outbreak, postponing retail and non-retail customers' due debts, restructuring with grace period and
existing or additional limit allocations in respect with customers’ needs. Assessments regarding to possible effects of the COVID-19 outbreak through
the measurement of expected credit losses are explained in the Section Three “VIII. “Explanations on Impairment of Financial Assets”.
“Interest Rate Benchmark Reform- Stage 2”, brought changes in various TAS / TFRSs effective from January 1, 2021, was released in December 2020
within the scope of the project of transition of the benchmark interest rates carried out by the International Accounting Standards Board (IASB). It was
concluded that as of December 31, 2022, the changes have not occurred significantly on the Bank's financial statements.
TAS 29 Financial Reporting in Hyperinflation Economies requires entities whose functional currency is that of a hyperinflationary economy to prepare
their financial statements in terms of the measuring unit current at the end of the reporting period. TAS 29 describes characteristics that may indicate
that an economy is hyperinflationary, and it requires all entities that report in the currency of the same hyperinflationary economy apply this Standard
from the same date. Therefore, it is expected that TAS 29 will start to be applied simultaneously by all entities with the announcement of Public Oversight
Accounting and Auditing Standards Authority to ensure consistency of the application required by TAS 29 throughout the country. However, the
Authority has not published any announcement that determines entities would restate their financial statements for the accounting period ending on
31 December 2022 in accordance with TAS 29. In this context, TAS 29 is not applied and inflation adjustment has not been reflected in the financial
statements as of December 31, 2022.
The tension between Russia and Ukraine since January 2022 has turned into a crisis and an armed conflict as of the date of the report. The Bank does
not carry out any activities in these two countries that are subject to the crisis. Considering the geographies in which the Bank operates, the crisis did
not have a direct impact on the Bank's operations as of 31 December 2022. However, since the course of the crisis is still uncertain as of the date of this
report, developments that may occur on a global scale, and the effects of these developments on the global and regional economy and on the Bank's
operations, are closely monitored. Since the Bank's risks to both countries are at a very low level, these developments are not expected to have an
significant impact on the Bank's operations and the aforementioned developments do not have a significant impact on the operations of our subsidiary,
JSC İşbank, which is within the scope of consolidation.
The accounting policies applied in the current period are in line with the prior period financial statements. The accounting policies and the valuation
principles used in the preparation of the consolidated financial statements are presented below in detail.
Strategy for Use of Financial Instruments and Foreign Currency Transactions
1. The Group’s Strategy on Financial Instruments
The Group’s main financial activities comprise a wide range of activities such as banking, insurance and reinsurance services, brokerage services,
investment consulting, real estate portfolio and asset management, financial lease, factoring services, portfolio and asset management. The liabilities on
the Group’s balance sheet are mainly composed of relatively short-term deposits, parallel to general liability structure of the banking system, which is its
main field of activity. As for the non-deposit liabilities, funds are collected through medium and long-term instruments. The liquidity risk that may arise
from this liability structure can be easily controlled through deposit continuity, as well as widespread network of the correspondent banks, market maker
status (The Parent Bank is one of the market maker banks) and by the use of liquidity facilities of the Central Bank of the Republic of Turkey (CBRT). As
a result, the liquidity of the Group and the banking system can be easily monitored. On the other hand, foreign currency liquidity requirements are met by
the money market operations and currency swaps.
Most of the funds collected bear fixed-interest, and by closely monitoring the developments in the sector, both fixed and floating rate placements are
made based on the yields of alternative investment instruments.
Some of the fixed interest liabilities that are issued/used by the Group companies are subject to fair value hedge accounting. The fair value risk of the related
fixed interest financial liabilities is protected by interest rate swaps. Explanations on hedge accounting are explained in Section Three, footnote IV.2.
The principle of safety is prioritized in placement works, placements are directed to high yield and low risk assets by considering their maturity
structures, while taking global and national economic expectations, market conditions, expectations and tendencies of current and potential loan
customers, interest rate, liquidity, currency risks and etc, into consideration. In long term placements, a pricing policy aiming at high return is applied in
general and attention is paid to maximizing non-interest income generation opportunities. In addition, the Bank and its subsidiaries within the scope of
consolidation act in parallel with these strategies and within the legal limits in management of Financial Statements.
The primary objectives related to balance sheet components are set by the long-term plans shaped along with budgeting; and the Parent Bank takes the
required positions against the short-term currency, interest rates and price fluctuations in accordance with these plans and the course of the market conditions.
Foreign currency, interest rate and price fluctuations in the markets are monitored instantaneously. While taking positions, in addition to the legal limits,
the Parent Bank’s own transaction and control limits are also effectively monitored in order to avoid limit overrides.
The Parent Bank’s asset-liability management is executed by the Asset-Liability Management Committee, within the risk limits determined by the Board
of Directors, in order to keep the liquidity risk, interest rate risk, currency risk and credit risk within certain limits depending on the equity adequacy and to
maximize profitability.
2. Foreign Currency Transactions
The financial statements of the Parent Bank’s branches and financial institutions that have been established abroad are prepared in functional currency
prevailing in the economic environment that they operate in; and when they are consolidated, they are presented in TL, which are the functional currency
of the Parent Bank and also the currency used in presentation of the financial statements.
Foreign currency monetary assets and liabilities on the balance sheet are converted into Turkish Lira by using the prevailing exchange rates at the
balance sheet date. Non-monetary items in foreign currencies carried at fair value are converted into Turkish Lira by the rates at the date of which the fair
value is determined. Exchange rate differences arising from the conversions of monetary foreign currency items and the collections of and payments in
foreign currency transactions are reflected to the income statement.
While the Parent Bank and Türkiye Sınai Kalkınma Bankası A.Ş. one of the consolidated subsidiaries, use their own foreign currency exchange rates for
their foreign currency transactions, other consolidated institutions residing domestically use the CBRT rates for their foreign currency transactions.
Assets and liabilities of the foreign branches of the Parent Bank and financial institutions that have been established abroad are converted into TL by
using the prevailing exchange rates at the balance sheet date. Income and expenses of foreign branches are converted by at exchange rates at the dates
of the transactions. Incomes and expenses of foreign financial institutions are converted into TL at average foreign currency rates of the balance sheet
date as long as there is not a significant fluctuation in currency rates during the period. The exchange rate differences arising from the conversion to TL
are recognized in the shareholders’ equity.
III.
Information on the Consolidated Companies
1. Basis of Consolidation:
The consolidated financial statements have been prepared in accordance with the procedures and principles listed in the “Communiqué Related to
Regulation on the Preparation of the Consolidated Financial Statements of Banks” published in the Official Gazette numbered 26340 dated November
8, 2006.
a. Subsidiaries:
A subsidiary is an entity that is controlled by the Parent.
Control; is the power of the Parent Bank to appoint or remove from office the decision-taking majority of members of board of directors through direct
or indirect possession of the majority of a legal person’s capital irrespective of the requirement of owning minimum fifty-one per cent of its capital; or by
having control over the majority of the voting right as a consequence of holding privileged shares or of agreements with other shareholders although not
owning the majority of capital.
As per the “Communiqué Related to the Preparation of Consolidated Financial Statements of Banks” published in the Official Gazette numbered 26340
dated November 8, there is no subsidiary or financial institution that is not included in the scope of consolidation as of the current period. Detailed
information about the Bank’s subsidiaries related to credit and financial institution is given in Section Five Note I.i.3
Under full consolidation method, the assets, liabilities, income and expenses, and off-balance sheet items of subsidiaries are combined with the
equivalent items of the Parent Bank. The book value of the Parent Bank's investment in each of the subsidiaries and the Group’s portion of equity of
each subsidiary are eliminated. All significant transactions and balances between consolidated subsidiaries are eliminated reciprocally. Non-controlling
interests in the net period profit/loss and in the equity of consolidated subsidiaries are calculated separately from the Group’s net period profit/loss and
the Group’s shareholders' equity. Non-controlling interests are presented separately in the balance sheet and in the period profit/loss statement.
In preparing its consolidated financial statements, the Bank performed necessary corrections to ensure consistency of accounting policies used by
consolidated subsidiaries. On the other hand, insurance companies under consolidation are obliged to carry their activities in accordance with the
regulations and other legislations issued by Republic of Turkey Ministry t of Treasury and Finance and in the accompanying consolidated financial
statements, financial reporting presentations of these companies are maintained in accordance with the insurance legislation.
TFRS 3 “Business Combinations” standard prescribes no depreciation to be recognized for goodwill arising on the acquisitions on or after March 31,
2004, realizing positive goodwill as an asset and application of impairment analysis as of balance sheet dates. In the same standard, it is also required
from that date onwards that the negative goodwill, which occurs in the case of the Group’s interest in the fair value of acquired identifiable assets and
liabilities exceeds the acquisition cost to be recognized in profit or loss.
In the prior period, positive consolidation goodwill amounting to TL 27,994 resulting from the acquisition of Moka Payment and Electronic Para
Organization Inc. is included in the consolidated financial statements.
The structured entity that is established within the Bank’s securitization loan transactions are included in the consolidated financial statement although
the bank does not have any subsidiaries.
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Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
b. Associates:
V.
Interest Income and Expenses
An associate is a domestic or foreign entity which the Parent Bank participates in its capital and over which it has a significant influence but no control.
Significant influence is the power to participate in the financial and operating policy of the investee. If the Parent Bank holds qualified shares in the
associate, it is presumed that the Parent Bank has significant influence unless otherwise demonstrated. A substantial or majority ownership by another
investor does not necessarily preclude the Parent Bank from having significant influence.
Interest income is calculated by using the effective interest rate method (the rate that equals the future cash flows of a financial asset or liability to its
present net book value) to gross carrying amount of financial asset in conformity with “TFRS 9 Financial Instruments” except financial asset that is not a
purchased or originated credit-impaired financial asset but subsequently has become credit-impaired.
Under the scope of TFRS 9 application, the Group does not reverse the interest accruals and rediscounts of non-performing loans and other receivables
and monitors the related amounts under interest income and calculates expected credit loss on these amounts according to the related methodology.
Qualified share is the share that directly or indirectly constitutes ten or more than ten percent of an entity’s capital or voting rights and irrespective of this
requirement, possession of privileged shares giving right to appoint members of board of directors.
VI.
Fees and Commission Income and Expenses
Equity method is a method of accounting whereby the book value of the investor’s share capital in the subsidiary or the joint venture is either added to
or subtracted in proportion with investor’s share from the change in the subsidiary’s or joint venture’s equity within the period. The method also foresees
that profit will be deducted from the subsidiaries’ or joint venture’s accordingly recalculated value.
Arap-Türk Bankası A.Ş. is a subsidiary of the Bank acting as a credit institution or financial institution, is accounted under the equity method in the
consolidated financial statements according to the "Communiqué on the Preparation of Consolidated Financial Statements”. Accounting policies of Arap
Türk Bankası A.Ş. are not different than the Parent Bank’s accounting policies. Detailed information about Arap Türk Bankası A.Ş. is given in Section Five
Note I.h.2.
c. Jointly controlled entities:
A joint venture is an agreement in which the Group has joint control, whereby the Group has rights to the net assets of the arrangement, rather than
rights to its assets and obligations for its liabilities.
The Bank does not have any jointly controlled entities which are credit or financial institutions in nature and to be consolidated in the financial statements
by the equity method according to the “Regulation on Preparation of Consolidated Financial Statements of Banks”.
d. Principles applied during share transfer, merger and acquisition:
None.
Wages and commissions those that are not an integral part of the effective interest rate of the financial instruments measured at amortized cost are
accounted for in accordance with "TFRS 15 - Revenue from Customer Contracts". Fees and commission income and expenses are recognized either
on accrual basis or by using the effective interest method. Income earned in return for services rendered contractually or due to operations like sale or
purchase of assets on behalf of a third-party real person or corporate body are recognized in income accounts in the period of collection.
VII.
Financial Assets
The Bank and its companies within the scope of “TFRS 9 Financial Instruments”, classifies and accounts its financial assets as “Financial Assets at Fair
Value Through Profit or Loss”, “Financial Assets at Fair Value Through Other Comprehensive Income” or “Financial Assets at Measured at Amortized
Cost” by taking into account their business model and contractual cash flow characteristics. Financial assets are recognized or derecognized according
to TFRS 9 “Recognition and Derecognition in Statement of Financial Position” requirements. Financial asset is recognized in the statement of financial
position when it becomes party to the contractual provisions of the financial instrument. Financial assets are measured at their fair value on initial
recognition in the financial statements.
The Group has three different business models for classification of financial assets;
ੵ Business model aimed at holding financial assets in order to collect contractual cash flows: Financial assets held under the mentioned business model
are managed to collect contractual cash flows over the life of these assets. The Group manages its assets held under this portfolio in order to collect
certain contractual cash flows.
ੵ Business model aimed at collecting contracted cash flows of financial assets and selling; in this business model, the Group intends both to collect
2. Presentation of subsidiaries, associates and jointly controlled entities which are not credit or financial institutions in consolidated financial
contractual cash flows of financial assets and to sell these assets.
statements:
The subsidiaries, associates and jointly controlled entities which are not credit or financial institutions owned by the Bank and its subsidiaries are
accounted accordingly to the equity method described in TAS 28 “Investments in Associates and Joint Ventures”.
IV.
Forward, Option Contracts and Derivative Instruments
Derivative transactions of the Group consist of foreign currency and interest rate swaps, forwards, foreign currency options and interest rate options. The
Group has no derivative instruments decomposed from the main contract.
ੵ Other business models; A business model in which financial assets; are not held within the scope of a business model aimed at collection of
contractual cash flows and within the scope of a business model aimed at collecting and selling contracted cash flows, are measured by reflecting fair
value in profit or loss.
The Group is able to reclassify all affected financial assets in case it changes the business model that is used for the management of financial asset.
In the event of the termination of the rights related to the cash flows from a financial asset, the transfer of all risks and rewards of the financial asset to a
significant extent or has no longer control of the financial assets, the financial asset is derecognized.
The Group classifies derivative products “Derivative Financial Instruments at Fair Value through Profit or Loss” or ‘’Derivative Financial Instruments
through Other Comprehensive Income’’ according to the “TFRS 9-Financial Instruments” principles.
1. Financial Assets at Fair Value Through Profit or Loss
1. Derivative Financial Instruments
Derivative transactions are recorded at their fair values as of the date of the contract and receivables and payables arising from these transactions are
recorded in off-balance sheet accounts. Derivative transactions are measured at their fair values in the reporting periods after their recognition and if
the valuation difference is positive, difference is presented under the “Derivative Financial Assets at Fair Value through Profit or Loss” and if the valuation
difference is negative, then it is presented under the “Derivative Financial Liabilities at Fair Value through Profit and Loss”. The differences arising from the
valuation of derivative transactions are associated with the income statement.
On off-balance sheet items table, options which generated assets for the Group are presented under “call options” line and which generated liabilities
are presented under “put options” line.
2. Hedging Derivative Financial Instruments
TFRS 9 “Financial Instruments” rules that TAS 39 “Financial Instruments: Recognition and Measurement” value hedge accounting may continue to be
implemented to hedge the fair value changes against interest rate risk. In this context, the principles of TAS 39 regarding hedge accounting for fair value
hedge accounting continue to be applied in the accompanying financial statements.
Interest rate swaps are performed in order to hedge the changes in fair value of fixed interest rate financial instruments.
In this context, if the valuation differences of the derivative transactions are positive, they are included in “Derivative financial assets at Fair Value through
Profit or Loss” and if the valuation differences are negative, they are included in “Derivative Financial Liabilities at Fair Value through Profit or Loss”.
Changes in the fair value of the fixed rate financial liabilities subject to hedge accounting and changes in the fair value of interest rate swaps as hedging
instruments are recorded under “Trading Profit/Loss” in the income statement.
At the beginning of the hedging transaction and in each reporting period, it is expected that the hedging transaction will offset the changes in the
hedged risk arising from the hedged transaction (related to the hedged risk) and effectiveness tests are performed in this context. Efficiency tests are
carried out with the “Dollar off-set method” and the hedging accounting is continued if the efficiency is between 80% and 125%.
The hedge accounting is terminated if the hedging instrument is terminated, realized, sold or the effectiveness test is ineffective. In the case of
termination of fair value hedge accounting, the valuation effects of the fair value hedge accounting applied on the hedged financial instruments is
reflected to the statement of profit or loss on a straight-line basis over the life of the hedged financial instrument.
Financial assets except financial assets measured at amortized cost or at fair value through other comprehensive income, are measured at fair value
through profit or loss. Financial assets at fair value through profit or loss are financial assets held for the purpose of generating profit from short-term
fluctuations in price or similar factors in the market or being part of a portfolio for profitability in the short term, regardless of the acquisition reason or
financial assets that are not held in a business model that aims at collecting and/or selling contractual cash flows of financial assets.
Financial assets at fair value through profit or loss are initially measured at fair value on the balance sheet and are subsequently re-measured at fair
value. Gains or losses arising from the valuation are related to profit and loss accounts.
In some cases, restructuring, alteration or counterparty changes of contractual cash flows of loans may lead to derecognition of related loans in
accordance with TFRS 9. When the change in the financial asset results from derecognizing the existing financial asset from the financial statements
and the revised financial asset is recognized in the financial statements, the revised financial asset is considered as a new financial asset in accordance
with TFRS 9. When it is determined that there are significant changes between the new conditions of the revised financial asset and the first conditions
in related agreements, the Group evaluates the new financial asset according to the current business models. When it is determined that the contractual
conditions do not only result in cash flows that include principal and interest payments at certain dates, the financial asset is recognized at fair value and
is subject to valuation. The differences arising from the valuation are reflected in the nominal accounts.
The Group recognizes loans at fair value through profit or loss, if the contractual terms of the loan, do not result in cash flows including the principal
payments and interest payments generated from principal amounts at certain dates. These loans are valued at their fair values after their recognition and
the losses or gains arising from the valuation are included in the profit and loss accounts.
2. Financial Assets at Fair Value Through Other Comprehensive Income:
Financial assets at fair value through other comprehensive income are financial assets that are held under a business model that aims both to collect
contractual cash flows and to sell financial assets, and financial assets with contractual terms that lead to cash flows that are solely payments of
principal and interest on the principle amount outstanding at specific dates.
Financial assets at fair value through other comprehensive income are initially recognized at their fair value including their transaction costs on the
financial statements. The initial recognition and subsequent valuation of such financial assets, including the transaction costs, are carried out on a fair
value basis and the difference between amortized cost and the cost of borrowing instruments is recognized in profit or loss by using the effective interest
method. Dividend income arising from investments in equity instruments that are classified as at fair value through other comprehensive income is also
recognized in income statements.
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Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Gains and losses, except impairment gain or loss and foreign exchange gain or loss, arising from changes in the fair value of financial assets at fair value
through other comprehensive income are reflected to other comprehensive income until derecognized or reclassified. When the value of the financial
asset is collected or financial asset is disposed, the related fair value differences accumulated in the shareholders’ equity are transferred to the profit/loss
statement.
During the initial introduction to financial statements, amendments to the fair value of an investment in an equity instrument within the framework of
TFRS 9 that are not held for trading or that are not valued in a financial statement of an entity that acquires business combinations under the “TFRS 3
Business Combinations” may be subject to an irreversible preference regarding these amendments being accounted in other comprehensive income. In
such case, dividends taken from mentioned investment will be accounted in financial statement as profit or loss.
3. Financial Assets Measured at Amortized Cost
Financial assets measured at amortized cost are those financial assets that are held within the framework of a business model aimed at collecting
contractual cash flows over the life of the asset and which result in cash flows that include principal and interest on the principal amount outstanding at
specific dates. Financial assets measured at amortized cost with the initial recognition at fair value including transaction costs are subject to valuation
with their discounted cost value by using the effective interest rate method, after eliminating any provision for impairment if there is any. Interest income
measured by using the effective interest rate method are recognized in the income statement as an “interest income”.
The Bank and subsidiaries evaluate their loans within the framework of current business models and depending on these evaluations, they can be
classified as Financial Assets measured at Amortized Cost.
On the other hand, the Parent Bank’s securities portfolio includes consumer price indexed government bonds classified (CPI) as financial assets at
fair value through other comprehensive income, financial assets at fair value through profit or loss, and financial assets measured at amortized cost. In
the valuation of mentioned securities, the realized CPI index announced by TURKSTAT, and the estimated inflation curve created by using the “Annual
CPI Expectation for the Next 12 Months” in the CBRT Market Participants Survey is used. The future cash flows of the securities are estimated by the
previously mentioned inflation data and the valuation is made according to the effective interest method within the framework of reference index formula
given by the CPI Indexed Bonds Investor’s Guide of the Undersecretariat of Treasury.
The Parent Bank also holds consumer price indexed government bonds (“CPI”) in its securities portfolio, reclassified as financial assets measured at fair
value through other comprehensive income, financial assets measured at fair value through profit or loss and financial assets measured at amortised
cost. In the valuation of the mentioned securities, the estimated inflation curve created by using the CPI index announced by Turkish Statistical Institute
(“TÜİK”) and the “Annual CPI Expectation After 12 Months” from the CBRT Market Participants Survey is used. Future cash flows of securities are
estimated by using the mentioned inflation data and valuation is made according to the effective interest method within the framework of the reference
inflaiton index formula specified in the Undersecretariat of Treasury’s Investor Guide of CPI.
VIII.
Impairment of Financial Assets
In accordance with the “TFRS 9- Financial Instruments” and the regulation “Procedures and Principals regarding Classification of Loans and Allowances
Allocated for Such Loans” issued by BRSA, the Bank recognizes expected credit loss allowance on financial assets at fair value through other
comprehensive income, financial assets measured at amortized cost, impaired credit commitments and financial guarantee contracts.
Within the scope of TFRS 9, the expected credit loss is calculated according to the “three-stage” impairment model based on the change in the loan
quality of financial assets after the initial recognition and detailed in the following headings:
While estimating the expected credit loss, statistical models, methods and tools are used in accordance with the relevant legislation and accounting
standards. Expected credit loss is measured using reasonable and supportable information by taking current and forecasts of future economic
information into consideration, including macroeconomic factors. Three scenarios, base scenario, optimistic scenario and the worst scenario, are used
in forecasting studies made by macroeconomic models. The variables used in these macroeconomic estimates include Industrial Production Index,
Employment Ratio and Credit Default Swap indicators. The validity of the risk parameter estimates used in the calculation of expected credit losses is
reviewed and evaluated at least annually within the framework of model validation processes. Macroeconomic forecasts and risk delinquency data used
in risk parameter models are re-evaluated every quarter to reflect the changes in economic conjuncture and are updated if needed. In the expected
credit loss calculations, macroeconomic information is taken into account under multiple scenarios.In this framework, necessary updates were made
in 2022. Except for demand or revolving loans, the maximum period for which expected credit losses are to be determined is the contractual life of the
financial asset. For demand or revolving loans, maturity is determined by taking the future risk mitigation processes into account such as behavioral
maturity analyses performed by the Bank and cancellation/revision of the Bank’s credit limit.
While calculating the expected credit loss, aside from assessment of whether there is a significant increase in credit risk or not, basic parameters
expressed as probability of default, loss given default and exposure at default are used.
Probability of Default: Represents the probability of default on the loan over a specified time period. In this context, the Bank has developed models
to calculate 12-month and life-time default probabilities by using internal rating based credit rating models. As for the Group Companies historical
probability of default data has also been observed.
Loss Given Default (LGD): Defined as the damage caused by the default of borrower to the total balance of the exposure at the time of default. The
LGD estimates are determined in terms of credit risk groups that are detailed in the Bank’s data resources and system facilities. The model used for the
estimation of the LGD was established by taking into account the direct cost items during the collection process based on the historical data of the
Bank’s collection, and cash flows are discounted at effective interest rates.
Exposure at Default: For cash loans, the cash balance at the date of report, for non-cash loans the balance calculated using the Credit Conversion
Factor (CCF) is represented by Exposure at Default.
Credit Conversion Factor: It is calculated for non-cash loans (undrawn limit for revolving loans, commitments, non-cash loans etc.) The historical limit
usage data of the Bank for revolving loans are analyzed and the limit amount that can be used until the moment of default is estimated. For non-cash
loans, the cash conversion ratio of the loan amount is estimated by analyzing the product type and the past compensation amount of the Group.
Credit risks, which require qualitative assessments due to their characteristics and differ followed by grouping in this manner, are considered as individual
within the internal policies. Calculations are made by the method of discounted cash flows with the effective interest rate expected from the relevant
financial instrument. Discounted cash flows are estimated for 3 different scenarios in which parameters are differentiated, and individual expected credit
loss is calculated by taking into consideration the cash deficit amounts weighted according to probabilities.
As mentioned above, the Bank allocated expected credit losses by reflecting additional provisions through individual assessments performed for the
customers that operates in sectors where the impact might be high in accordance with the Bank’s risk policies.
Expected credit loss is reflected in the income statement. Released provisions in the current year are accounted under “Expected Credit Loss Expenses”
and released provision which is carried from the prior year are accounted under “Other Operating Income”.
Receivables evidenced through the Legal Process that collection is not possible can be written-off by fulfilling the requirements of the Tax Procedure
Law. Besides, loans for which specific provision is allocated and for which there is no reasonable expectation of recovery might be written-off.
Stage 1:
IX.
Offsetting Financial Instruments
An important determinant for calculating the expected credit loss in accordance with TFRS 9 is to assess whether there is a significant increase in the
credit risk of the financial asset. Financial assets that have not experienced a significant increase in credit risk since the initial recognition are monitored
in the stage 1. Impairment for credit risk for the Stage 1 financial assets is equal to the 12-month expected credit losses.
Financial assets and financial liabilities shall be offset and the net amount shall be presented in the balance sheet only when a party currently has
a legally enforceable right to set off the recognized amounts or intends either to settle on a net basis or to realize the asset and settle the liability
simultaneously.
Stage 2:
Financial assets that experienced a significant increase in the credit risk since initial recognition, are transferred to Stage 2. The expected credit loss of
these financial assets are measured at an amount equal to the instrument’s lifetime expected credit loss.
In order to classify a financial asset in the Stage 2, the following criteria is considered:
ੵ Overdue between 30-90 days
ੵ Restructuring of the loan
ੵ Significant deterioration in the probability of default
In case of a significant deterioration in the probability of default, the credit risk is considered to be increased significantly and the financial asset is
classified as stage 2. The absolute and gradual thresholds used to increase the probability of default are differentiated on the basis of portfolio and
product group. In this manner, for the commercial portfolio, definition of increase in the probability of default is the comparison between the probability
of default on loan’s opening date, obtained from the integrated rating/score based on internal rating and probability of default of the same loan on
reporting date, obtained from the integrated rating/score based on internal rating. For the individual portfolio, it is accepted that the probability of default
is worsened in cases where the behavioral score falls below the thresholds determined on the basis of the product and the probability of default exceeds
the thresholds determined on the basis of the product.
Stage 3:
Financial assets with sufficient and fair information for impairment at the reporting date, are classified in the third stage. Expected credit loss of these
financial assets is measured at an amount equal to the lifetime expected credit loss. The following basic factors are considered for the classification of a
financial asset in the stage 3.
ੵ More than 90 days past due
ੵ Whether the credit rating is weakened, has suffered a significant weakness or cannot be collected or there is a certain opinion on this matter
X.
Sale and Repurchase Agreements and Securities Lending Transactions
Marketable securities subject to repurchase agreements are classified under “Financial Assets at Fair Value through Profit and Loss”, “Financial Assets
at Fair Value through Other Compre hensive Income” or “Financial Assets Measured at Amortized Cost” in the portfolio and they are valued according to
the valuation principles of the related portfolios.
Funds obtained from the repurchase agreements are recognized under “Funds from Repurchase Transactions” account in liabilities. For the difference
between the sale and repurchase prices determined by the repo agreements for the period; expense accrual is calculated using the effective interest rate
method.
Reverse repo transactions are recognized under the “Receivables from Reverse Repo Transactions” account. For the difference between the purchase
and resale prices determined by the reverse repo agreements for the period, income accrual is calculated using the effective interest rate method.
XI.
Non-current Assets Held for Sale and Discontinued Operations and Related Liabilities
Assets that meet the criteria to be classified as held for sale within the scope of “TFRS 5 – Non-current Assets Held for Sale and Discontinued
Operations” are measured at the lower one of their fair value and their carrying amount which from the costs to sell are deducted and presented
separately within the financial statements. In order to classify a tangible fixed asset as held for sale, the asset (or the disposal group) should be available
for an immediate sale in its present condition subject to the terms of any regular sales of such assets (or such disposal groups) and the sale should be
highly probable. For a highly probable sale, the appropriate level of management must be committed to a plan to sell the asset (or the disposal group),
and an active programme to complete the plan should be initiated to locate a customer. Also, the asset (or the disposal group) should have an active
market sale value, which is a reasonable value in relation to its current fair value. Events or circumstances may extend the completion of the sale more
than one year. Such assets are still classified as held for sale if there is sufficient evidence that the delay in the sale process is due to the events and
circumstances occurred beyond the control of the entity or the entity remains committed to its plan to sell the asset (or disposal group).
A discontinued operation is a component of a group that either has been disposed of or is classified as held for sale. Gains or losses relating to
discontinued operations are presented separately in the income statement.
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Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
XII.
Goodwill and Other Intangible Assets
The Group’s intangible assets consist of consolidation goodwill, software programs and rights.
Goodwill arising from the acquisition of a subsidiary represents the excess of cost of acquisition over the fair value of Group’s share of the identifiable
assets, liabilities, or contingent liabilities of the acquired subsidiary at the date of acquisition of the control. Goodwill is recognized as an asset at cost and
then carried at cost less accumulated impairment losses. In impairment-loss test, goodwill is allocated between the Group’s every cash-generating unit
that is expected to benefit from the synergies of the business combination. To control whether there is an impairment loss in the cash-generating units
that goodwill is allocated, impairment- loss test is applied every year or more often if there are indications of impairment loss. In the cases, recoverable
amount of cash-generating unit is smaller than its book value; impairment loss is firstly used in reduction of book value of the cash-generating unit,
and then the other assets proportionally. Goodwill which is allocated for the impairment losses could not be reversed. When a subsidiary is to be sold,
related goodwill amount is combined with the profit/loss relating to this disposal. Positive goodwill arising from the Group’s investments in its subsidiaries
is recognized in “Intangible Assets”. Explanations on consolidation goodwill are given in Section Three, Note III.1.a.As for other intangible assets, the
purchased items are presented with their acquisition costs less the accumulated amortization and impairment provisions. In case there is an indication of
impairment, the recoverable amount of the related intangible asset is estimated within the framework of TAS 36 “Impairment of Assets” and impairment
provision is set aside in case the recoverable amount is below its acquisition cost. The related assets are amortized by the straight-line method
considering their estimated useful life. The amortization method and period are periodically reviewed at the end of each year.
XIII.
Tangible Assets
The Bank and Group companies follow their real estates in use, which are recorded under tangible fixed assets, according to the revaluation model within
the framework of "TAS 16 – Property, Plant and Equipment" since 2015. The positive difference between the net book value of real estate property
values and the renewed expertise values which are determined by the licensed valuation in 2022 companies are recorded under the shareholders’
equity.
In case there is an indication of impairment, the recoverable amount of the related intangible asset is estimated within the framework of “TAS 36 –
Impairment of Assets” and impairment provision is set aside in case the recoverable amount is below its acquisition cost.
Tangible assets other than the land and construction in progress are amortized by the straight-line method, according to their estimated useful lives. The
estimated useful life, residual amount and the method of amortization are reviewed every year for the possible effects of the changes that occur in the
estimates and if there is any change in the estimates, they are recognized prospectively.
Assets held under finance lease are depreciated over the expected useful life of the related assets.
Assets subject to leasing are depreciated according to relevant contract periods.
Leasehold improvements are amortized in equal amounts considering their useful life. However, in any case the useful life cannot exceed leasing term.
When the lease period is not certain or longer than 5 years, the amortization period is recognized as 5 years.
The difference between the sales proceeds arising from the disposal of tangible assets or the inactivation of tangible asset and the book value of the
tangible assets are recognized in the profit and loss accounts.
Regular maintenance and repair cost incurred for tangible assets are recognized as expense.
There are no pledges, mortgages and similar encumbrances on tangible assets.
The “Regulation on Procedures and Principles for the Trading of Precious Metals by Banks and the Disposal of Commodities and Real Properties
acquired by Banks due to their Receivables” has been abolished by BRSA effective from January 1, 2017. Real properties acquired by Group due to their
receivables and not treated in the scope of “TFRS 5 - Non-current Assets Held for Sale and Discontinued Operations" has been started to follow under
“Other Assets” in accordance with the related accounting standard from the current period.
The depreciation rates used in amortization of tangible assets and their estimated useful lives are as follows:
Buildings
Safe Boxes
Other Movables
50
2-50
2-25
2%
2% - 50%
4% - 50%
Estimated Economic Life (Year)
Depreciation Rate
XIV.
Investment Property
Investment properties are kind of properties held by the Group to earn rent income or benefit from valuation surplus. The investment properties of the
Group are measured at their fair values in the consolidated financial statements in accordance with “TAS 40 Investment Property”. Any gains or losses
arising from changes in fair values of investment properties are recognised in “Other Operating Incomes” and “Other Operating Expenses” for the related
period.
XV.
Leasing Transactions
Assets acquired through financial leases are carried at the lower of their fair values or amortized value of the lease payments. Leasing payables are
recognized as liabilities in the balance sheet while the interest payable portion of the payables is recognized as a deferred amount of interest. Finance
lease payments are separated as financial expense and principal amount payment, which provides a decrease in finance lease liability, thus helps a fixed
rate interest on the remaining principal amount of the debt to be calculated.
Within the context of the consolidation general borrowing policy, financial expenses are recognized in the income statement. Assets held under financial
leases are recognized under the tangible assets account and are depreciated by using the straight line method. There is one company which exclusively
does finance leases (İş Finansal Kiralama A.Ş.) and one bank (Türkiye Sınai Kalkınma Bankası A.Ş.) which operates finance lease activities as per
provisional article No 4 of the Banking Law No 5411. Finance lease activities are operated according to the “Law on Financial Leasing. Factoring and
Financing” No 6361.
The Bank and the Companies in scope of consolidation have accounted for recognized operating leases in accordance with the TFRS 16 "leases"
standard. Operating leases within the framework of the aforementioned standard are monitored in a similar manner to financial leases. For the
agreements within the scope of TFRS 16, the right-of-use-asset and the lease payments are reflected to the financial statements and they are presented
under "Tangible Assets" and "Liabilities from Financial Leases", respectively. The lease liability is calculated by discounting the future lease payments by
the use of the Banks or alternative borrowing interest rates at the date of initial application or contract date. Fixed assets, which are accounted as right-
of-use assets, are subject to depreciation considering the period of the contract. Interest expenses and foreign exchange differences related to the lease
liabilities are associated with profit and loss statement.
XVI.
Insurance Technical Income and Expensealar
In insurance companies, premium income is obtained after diminishing the shares transferred from arranged policy income to reassurer.
Claims are recorded in expense on accrual basis. Outstanding loss provisions are recognized for the claims reported but not paid yet and for the claims
that incurred but not reported. Reassurer’ shares of outstanding and paid claims are offset in these provisions.
XVII.
Insurance Technical Provisions
TFRS 4 “Insurance Standards” requires that all contracts issued by insurance companies be classified as either insurance contracts or investment
contracts. Contracts with significant insurance risk are considered insurance contracts. Insurance risk is defined as risk, other than financial risk,
transferred from the holder of a contract to the issuer. Contracts issued by insurance companies without significant insurance risk are considered
investment contracts. Investment contracts are accounted for in accordance with TAS 39 “Turkish Accounting Standard for Financial Instruments:
Recognition and Measurement”.
Within the framework of the current insurance regulation, insurance technical provisions accounted by insurance companies for unearned premium
claims, unexpired risk reserves, outstanding claims and life-mathematical reserves are presented in the consolidated financial statements.
Unearned premium reserve is recognized on accrued premiums without discount or commission which extends to the next period or periods on a daily
basis for the current insurance contracts.
In case the expected loss premium ratio is over 95%, the unexpired risk reserves are recognized for the main branches specified by the Undersecretariat
of Treasury. For each main branch, the amount found by multiplying the ratio exceeding 95% by the net unearned premium provision, is added to the
unearned premium provision of that main branch.
If the outstanding claim reserve is established and confirmed by approximation and if there are unpaid or unidentified compensation amounts in both
prior and current accounting periods; it is separated for estimated yet unreported compensation amounts.
Mathematical reserve is recognized on actuarial bases in order to meet the requirements of policyholders and beneficiaries for life, health and personal
accident insurance contracts for a period longer than a year.
On the other hand, actuarial chain ladder method is used to estimate the reserve amount to be set aside in the current period by looking at the data of
the past materialized losses. If the reserve amount found as a result of this method exceeds the amount of reserve for the amount of uncertain indemnity,
additional reserve must be set aside for the difference.
Reinsurance companies recognize for the outstanding claims that is declared by the companies, accrued and determined on account.
Insurance companies of the Group cede premium and risks in the normal course of business in order to limit the potential for losses arising from risks
accepted. Insurance premiums ceded to reinsurers on contracts that are deemed to transfer significant insurance risk are recognized as an expense in a
manner that is consistent with the recognition of insurance premium revenue arising from the underlying risks being protected.
Costs which vary and are directly associated with the acquisition of insurance and reinsurance contracts including brokerage, commissions,
underwriting expenses and other acquisition costs are deferred and amortized over the period of contract, consistent with the earning of premium.
XVIII. Provisions and Contingent Liabilities
As of the end of the reporting period, a past event is deemed to give rise to a present obligation if, taking account of all available evidence, it is more likely
than not that a present obligation exists, the entity recognizes a provision in the financial statements. As of the end of the reporting period where it is
more likely that no present obligation exists at the end of the reporting period, the entity discloses a contingent liability on footnotes unless the possibility
of an outflow of resources embodying economic benefits is remote.
In the financial statements, a provision is made for an existing commitment resulted from past events if it is probable that the commitment will be settled
and a reliable estimate can be made of the amount of the obligation.
Provisions are calculated based on the reliable estimates of management of the Parent Bank and subsidiaries on the expenses to incur as of the balance
sheet date to fulfill the liability by considering the risks and uncertainties related to the liability. In case the provision is measured by using the estimated
cash flows required to fulfill the existing liability, the book value of the related liability is equal to the present value of the related cash flows.
If the amount is not reliably estimated and there is no probability of cash outflow from the Group to settle the liability, the related liability is considered as
“contingent” and disclosed in the notes to the financial statements.
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Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
XIX. XIX. Contingent Assets
The contingent assets usually arise from unplanned or other unexpected events that give rise to the possibility of an inflow of economic benefits to the
Parent Bank and the Group. Since showing the contingent assets in the financial statements may result in the accounting of an income, which will never
be generated, the related assets are not included in the financial statements, but if there is a possibility that an inflow of economic benefits of these
assets may occur then it is explained in the footnotes of the financial statements. Nevertheless, the developments related to the contingent assets are
constantly evaluated and if it has become virtually certain that an inflow of economic benefits will arise, the asset and the related income are recognized
in the financial statements of the period in which the change occurs.
XX.
Liabilities Regarding Employee Benefits
1. Severance Indemnities and Short-Term Employee Benefits
According to the related regulation and the collective bargaining agreements, the Parent Bank and consolidated Group companies (excluding the
subsidiaries residing outside Turkey) are obliged to pay termination benefits for employees who retire, die, quit for their military service obligations,
who have been dismissed as defined in the related regulation or (for the female employees) who have voluntarily quit within one year after the date
of their marriage. Within the scope of TAS 19 “Employee Benefits”, the Parent Bank allocates severence indemnity provisions for employee benefits
by estimating the present value of the probable future liabilities. According to TAS 19, all actuarial gains and losses occurred are recognized under
shareholders’ equity. As the legislations of the countries in which the Parent Bank’s non-resident subsidiaries operate do not require retirement pay
provision, no provision liability has been recognized for the related companies. In addition, provision is also allocated for the unused paid vacation.
2. Retirement Benefit Obligations
İşbank Pension Fund (Türkiye İş Bankası A.Ş. Emekli Sandığı Vakfı), of which each employee of the Parent Bank is a member, has been established
according to the provisional Article 20 of the Social Security Act No 506. As per provisional article numbered 23 of the Banking Law numbered 5411, it
is ruled that Bank pension funds, which were established within the framework of Social Security Act, will be transferred to the Social Security Institution,
within 3 years after the publication of such law. Methods and principles related to transfer have been determined as per the Cabinet decision dated 30
November 2006 numbered 2006/11345. However, the related article of the act has been cancelled upon the President’s application dated November 2,
2005, by the Supreme Court’s decision dated March 22, 2007. Nr.E.2005/39. K.2007/33, which was published on the Official Gazette dated March 31,
2007 and numbered 26479 and the execution decision was ceased as of the issuance date of the related decision.
After the justified decree related to cancelling the provisional Article 23 of the Banking Law was announced by the Constitutional Court on the Official
Gazette dated December 15, 2007 and numbered 26731. Turkish Grand National Assembly started to work on establishing new legal regulations, and
after it was approved at the General Assembly of the TGNA, the Law numbered 5754 “Emendating Social Security and General Health Insurance Act
and Certain Laws and Decree Laws”, which was published on the Official Gazette dated May 8, 2008 and numbered 26870, came into effect. The new
law decrees that the contributors of the Bank pension funds, the ones who receive salaries or income from these funds and their rightful beneficiaries
will be transferred to the Social Security Institution and will be subject to this Law within 3 years after the release date of the related article, without any
need for further operation. The three-year transfer period can be prolonged for maximum 2 years by the Cabinet decision.
However related transfer period has been prolonged for 2 years by the Cabinet decision dated, March 14, 2011. which was published on the Official
Gazette dated April 9, 2011 and numbered 27900, In addition, by the Law “Emendating Social Security and General Health Insurance Act”, which was
published on the Official Gazette dated March 8, 2012 and numbered 28227, this period of 2 years has been raised to 4 years after that related transfer
period has been prolonged for one more year by the Cabinet decision dated April 8, 2013, which was published on the Official Gazette dated May 3,
2013 and numbered 28636 also this period has revalidated one more year by the Cabinet decision dated February 24, 2014, which was published on
the Official Gazette dated April 30, 2014 and numbered 28987.
The Council of Ministers has been lastly authorized to determine the transfer date in accordance with the last amendment in the first paragraph of the
20th provisional article of Law No.5510 implemented by the Law No. 6645 on Amendment of the “Occupational Health and Safety Law and Other Laws
and Decree Laws” published in the Official Gazette dated April 23, 2015 and numbered 29335. This authority was transferred to the President with the
delegated legislation No.703 which published in the repetitive Official Gazette No. 30473 dated July 9, 2018.
On the other hand, the application made on June 19, 2008 by the Republican People’s Party to the Constitutional Court for the annulment and motion
for stay of some articles, including the first paragraph of the provisional article 20 of the Law, which covers provisions on transfers, was rejected in
accordance with the decision taken at the meeting of the afore-mentioned court on March 30, 2011..
The above mentioned Law also states that;
ੵ Through a commission constituted by the attendance of one representative separately from the Social Security Institution, Ministry of Finance, Turkish
Treasury, State Planning Organization. Banking Regulation and Supervision Agency. Savings Deposit Insurance Fund, one from each pension fund, and
one representative from the organization employing pension fund contributors, related to the transferred persons, the cash value of the liabilities of the
pension fund as of the transfer date will be calculated by considering their income and expenses in terms of the lines of insurance within the context of
the related Law, and technical interest rate of 9.8% will be used in the actuarial calculation of the value in cash
ੵ And that after the transfer of the pension fund contributors, the ones who receive salaries or income from these funds and their rightful beneficiaries to
the Social Security Institution, these persons’ uncovered social rights and payments, despite being included in the trust indenture that they are subject
to, will be continued to be covered by the pension funds and the employers of pension fund contributors.
In line with the new law, the Bank obtained a technical actuarial valuation report from a licensed actuary for the year ended December 31, 2022. In
related period’s financial statements, Bank provided full provision for the total amount of technical and actual deficit stated in the actuarial report of
the aforementioned period The actuarial assumptions used in the related actuarial report are given in Section Five Note II-h-4-1. Besides the Parent
Bank; Anadolu Anonim Türk Sigorta Şirketi, Milli Reasürans T.A.Ş. and Türkiye Sınai Kalkınma Bankası A.Ş. also had actuarial valuations as of December
31, 2022 for their pension funds. The provision amount of actuarial and technical deficit, which was measured according to actuarial report of Milli
Reasürans T.A.Ş., is added in the financial statements for the current period. According to actuarial report of Anadolu Anonim Türk Sigorta Şirketi and
Türkiye Sınai Kalkınma Bankası, there is not any additional operational or actuarial liability.
İşbank Members’ Supplementary Pension Fund has been founded by the Parent Bank to provide beneficiaries with additional social security and
solidarity rights to compulsory social security benefits as per the provisions of the Turkish Commercial Code and Turkish Civil Code. Those are also valid
for the supplementary pension funds of the employees of Anadolu Anonim Türk Sigorta Şirketi, Milli Reasürans T.A.Ş. and Türkiye Sınai Kalkınma Bankası
A.Ş. which are among the other financial institutions of the Group.
XXI.
Taxation
1. Corporate Tax:
Turkish tax legislation does not permit a parent company and its subsidiary to file a consolidated tax return. Therefore, provisions for taxes, as reflected in
the accompanying consolidated financial statements, have been calculated on a separate-entity basis.
In accordance with the Provisional Article 13 added to the Corporate Tax Law Numbered 5520 with the Law Numbered 7316, the 20% rate foreseen
in the calculation of the corporate tax for the corporate earnings of the 2021 taxation period is determined as 25% (starting from the declarations to be
submitted as of July 1, 2021 and to be valid for the corporate earnings for the taxation period starting from January 1, 2021), and as 23% for the corporate
earnings for the 2022 taxation period. On the other hand, in accordance with the amendment made in Article 32 of the Corporate Tax Law with the Law
No. 7394 published in the Official Gazette dated 15.04.2022 and numbered 31810, the corporate tax rate should start from the declarations that must
be submitted as of 01.07.2022 and taxation starting from 01.01.2022. It has been determined as 25% to be valid for the corporate earnings of the period.
The Group has calculated deferred tax using the 25% rate (31 December 2021: 20%, 23% and 25% rates are used).
As per the Corporate Tax law, temporary tax is calculated and paid quarterly in line with the principles of the Income Tax Law and at the corporate tax
rate. The temporary tax payments are deducted from the current period’s corporate tax. The 4th provisional tax for the year 2022 will be paid in February
2023 for to be deducted from the corporate tax of the current taxation period.
Tax provision consists of current tax provision and deferred tax income/expense. The current tax liability is calculated over the portion of the period
subject to taxation. The taxable profit differs from the profit involved in the statement of profit and loss, as the income and expense items that can be
taxable or deductible at other periods, and items that are not taxable or deductible are excluded. The current tax amounts payable is netted off with
prepaid tax amounts and presented on the financial statements.
Within the framework of the Corporate Tax Law numbered 5520, 75% of the gains on the sale of the participation shares, which were held in the assets for
a minimum of 2 whole years and 75% of the gains on the sale of immovable are exempt from tax provided that they are added to the capital as set forth by
the Law or that they are kept in a special fund under liabilities for a period of 5 years. However, in accordance with Article 89 / a of the Law No. 7061 and
Article 5.1.e and Article 5.1.f of the Corporate Tax Law, which were published in the Official Gazette dated December 5, 2017 and numbered 30261, the 75%
applied in terms of immovable sales mentioned above has been reduced to 50% which is effective from the date of publication of the Law.
In accordance with the provision of Article 298 / A of the Tax Procedure Law, the necessary conditions for inflation adjustment in the calculation of
corporate tax as of the end of the 2021 calendar year have been met. However, the application of inflation adjustment in the calculation of corporate tax
was postponed to 2023 with the regulation made with the "Law on the Amendment of the Tax Procedure Law and the Corporate Tax Law" numbered
7352 published in the Official Gazette dated 29.01.2022 and numbered 31734. Accordingly, VUK (Tax Procedure Law) financial statements for the 2021
and 2022 accounting periods, including the provisional tax periods, will not be subject to inflation adjustment, and the 2023 accounting period will not
be subject to inflation adjustment as of the temporary tax periods. will be subject to inflation adjustment regardless.
2. Deferred Tax:
Deferred tax asset or liability is determined by calculating the tax effects of temporary differences between the carrying amounts of assets and liabilities
in the financial statements and the amounts considered in the legal tax base account, by taking the legal tax rates into account. Deferred tax debts are
generally recognized for all taxable temporary differences and deferred tax assets are recognized to the extent that it is probable that taxable profits will
be available against which deductible temporary differences can be utilized. Free provisions that are allocated for possible future risks and they are not
subject to deferred tax calculation. No tax assets or liabilities are recognized for the temporary timing difference that affects neither the taxable profit nor
the accounting profit and that arises from the initial recognition in the balance sheet, of assets and liabilities, other than the goodwill and mergers. The
Bank calculates deferred tax for the provisions allocated for Stage 1 and Stage 2 expected credit loss.
The carrying values of deferred tax assets are reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient
taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax is measured at enacted tax rates prevailing in the period or about to be enacted when the assets are realized or liabilities are settled, and the
tax is recognized as income or expense in the income statement. Nonetheless, if the deferred tax is related to assets directly associated with the equity
in the same or different period, it is directly recognized in the equity accounts. In accordance with the Provisional Article 13 added to the Corporate Tax
Law Numbered 5520 with the Law Numbered 7316, the 20% rate foreseen in the calculation of the corporate tax for the corporate earnings of the 2021
taxation period is determined as 25% (starting from the declarations to be submitted as of July 1, 2021 and to be valid for the corporate earnings for the
taxation period starting from January 1, 2021), and as 23% for the corporate earnings for the 2022 taxation period. On the other hand, in accordance with
the amendment made in Article 32 of the Corporate Tax Law with the Law No. 7394 published in the Official Gazette dated 15.04.2022 and numbered
31810, the corporate tax rate should start from the declarations that must be submitted as of 01.07.2022 and taxation starting from 01.01.2022. It has
been determined as 25% to be valid for the corporate earnings of the period. The Bank has calculated deferred tax by using 25% rate considering the
periods when deferred tax assets and liabilities are realized (December 31, 2021: 20%, 23%, and 25% rates are used).
Deferred tax assets and liability of the Bank and consolidated companies are shown by way of offsetting in separate financial statements of each entity.
In the consolidated financial statements, on the other hand, the deferred tax assets and liabilities that come from the companies as offset are separately
involved in the assets and liabilities.
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Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
3. Tax Practices in the Countries that Foreign Branches Operate:
4. Transfer Pricing:
Turkish Republic of Northern Cyprus (TRNC)
In accordance with TRNC tax legislation, 15% income tax is accrued on the remaining tax base after 10% corporate tax is deducted from corporate
income. The tax bases for companies are determined by adding the expenses that cannot be deducted according to TRNC regulations, to commercial
gains and by subtracting exemptions and deductions from commercial gains. Income tax is paid in June, and corporate tax payment is made in two
equal installments, in May and in October. On the other hand, withholding tax is paid in TRNC over interest income and similar gains of the companies.
The related withholding tax payments and provisional tax paid every quarter during the year are deducted from corporate tax payable and the difference
between withholding and provisional tax amounts and corporate tax payable is discounted from income tax provided that the withholding tax and paid
provisional tax amounts are higher than corporate tax amount.
England
Corporate earnings are subject to 19% corporate tax in England. The relevant rate is applied to the tax base that is determined by adding the expenses
that cannot be deducted due to the regulations, to commercial gains and by subtracting exemptions and deductions from commercial gains. In other
respect, if the tax base calculated in accordance with the country legislation is within a certain range, the temporary corporate tax is paid in July, October
of the relevant year and in January and April of the following year; If it is over a certain amount, it is paid in 4 installments in March, June, September and
December of the relevant year. The corporate tax amount must be finalized and paid by the end of September of the year following the year of profit. In
case the corporate tax payable as a result of the calculation is below the temporary taxes paid, the difference amount is deducted later or paid back to
the Branch by the authority.
Bahrain
Banks in Bahrain are not subject to tax according to the regulations of the country.
The Republic of Iraq (Iraq)
The corporate tax rate in Iraq is 15%, and the corporate tax is paid on a consolidated basis to the tax office of the foreign bank's central branch. The
first branch established in Iraq is considered as the central branch. Foreign bank branches whose central branch is within the boundaries of the Central
Government must present their consolidated financial statements and pay accrued tax to the relevant tax office by the end of May of the following year,
and branches of foreign banks whose central branch is within the boundaries of the Northern Iraq Regional Government must present their financial
statements and pay accrued tax by the end of June of the following year at the latest. Northern Iraq Regional Government tax offices can accrue fixed
taxes other than the specified rate and can postpone the due date.
Kosovo
Corporate earnings are subject to income tax rate of 10% according to the Kosovo legislation. This ratio is applied to the tax base that will be calculated
as a result of the implementation of exemptions, deductions, addition of disallowable expenses, to the corporate income and that are calculated
in accordance with the tax laws. Tax has to be paid in advance until April, July, October and the 15th day of January of the following year by four
installments. If those prepaid taxes are lower than the final corporate tax, the difference is paid until the end of March of the following year, in case of a
claim made by company, if it is higher, then the difference is returned to the institution by the tax authorities after the inspection conducted by those
institution.
Georgia
Corporate earnings are subject to income tax rate of 15% according to the Georgian legislation. This ratio is applied to the tax base that will be calculated
as a result of the implementation of exemptions, deductions, addition of disallowable expenses, to the income of corporations and that are calculated
in accordance with the tax laws. In addition, in accordance with the legislation of Georgia, each year during May, July, September and December the
amount of tax, that calculated according to the previous year income tax, is paid to the tax office by four equal installments of the probable income that is
likely to be obtained the current year. If those prepaid taxes are lower than the final corporate tax, the difference is paid until the beginning of April of the
following year, if it is higher, then the difference is returned to the institution by the tax authorities.
Germany
According to the tax regulations in Germany, corporate gains are subject to 15% corporate tax, 16.7% income and industrial tax. In addition to this,
a solidarity tax of 5.5% is calculated over this corporate tax. The tax bases for corporate, income and industrial services are determined by adding
the expenses that cannot be deducted according to Germany regulations, to interest, commissions and other operating gains and by subtracting
exemptions and deductions from these. The corporate tax payments are made as temporary tax payments in four installments and are deducted from
the corporate tax that is finalized at the end of the current year.
Russia
According to the Russian regulations, corporate gains are subject to 20% corporate tax. The corporate tax base is determined on accrual basis and it is
measured by adding the non-deductible expenses to the corporate income gained during the period. Companies in Russia make quarterly tax returns and
make provisional tax payment by offsetting the advance taxes paid during the period. Final taxation period for corporate tax is one year and the corporate
tax is paid until the end of March of the following year, by considering the provisional taxes paid during the year. Coupon income from government bonds
of the Russian Federation and Belarus, as well as the Ruble and some other private bonds issued by Russian companies after January 1, 2017 and traded
on the stock exchange are subject to a corporate tax of 15%. The securities in the question income is paid within 10 business days from the end of the
month following the bond sale or coupon payment and tax on remaining securities is paid on the day of payment of corporate tax.
Transfer pricing is regulated through Article 13 of Corporate Tax Law titled “Transfer Pricing through Camouflage of Earnings”. Detailed information for the
practice regarding the subject is found in the “General Communiqué Regarding Camouflage of Earnings through Transfer Pricing”.
According to the aforementioned regulations, in the case of making purchase or sales of goods or services with relevant persons/corporations at a price
that is determined against “arm’s length principle”, the gain is considered to be distributed implicitly through transfer pricing and such distribution of
gains is not subject to deductions according to article 11 of Corporate Tax Law in means of corporate tax.
XXII. Additional Information on Borrowings
The Parent Bank and its consolidated companies, whenever required, generates funds from individuals and institutions residing domestically and abroad
by approaching the borrowing instruments in the form of syndication, securitization, collateralized borrowing and issue of bonds/bills. Such transactions
are at first carried at acquisition cost, and in the following periods they are valued at amortized cost measured by using the effective interest rate method.
Part of the bills issued by the Group with fixed interest and a part of its liabilities with fixed interest are subject to fair value hedge accounting. While the
rediscounted credit risk and accumulated interest amount subject to hedging liability are recognized in “Interest Expenses” under profit/loss statement;
net amount resulted of the hedge accounting other than the credit risk and accumulated interest amount are recognized in “Derivative Financial
Transactions Gains/Losses” under profit/loss statement by using fair value model. In the balance sheet, these valuations are presented with the related
liabilities.
XXIII.
Information on Equity Shares and Their Issuance
Share issuance related to costs is recognized as expenses.
Dividend income related with the equity shares are determined by the General Assembly of the Shareholders.
Weighted average number of shares outstanding is taken into account in the calculation of earnings per share. In case the number of shares increases by
way of bonus issues as a result of the capital increases made by using the internal sources, the calculation of earnings per share is made by adjusting the
weighted average number of shares, which were previously calculated as at the comparable periods.
The adjustment means that the number of shares used in calculation is taken into consideration as if the bonus issue occurred at the beginning of
the comparable period. In case such changes in the number of shares occur after the balance sheet date, but before the ratification of the financial
statements to be published, the calculation of earnings per share are based on the number of new shares. The Parent Bank’s earnings per share
calculations taking place in the consolidated profit/loss statement are as follows.
Group’s net profit
Weighted average number of shares (thousands)
Earnings per share – (in exact TL)
XXIV. Bank Acceptances and Bills of Guarantee
Current Period
61,598,670
250,002,250
0.246392462
Prior Period
13,541,060
250,002,250
0.054163753
Bill guarantees and acceptances are realized simultaneously with the customer payments and they are presented as possible liabilities and
commitments in the off-balance sheet accounts.
XXV. Government Incentives
There are no government incentives utilized by the Bank or the companies included in consolidation, during the current or prior accounting periods.
XXVI. Segment Reporting
Business segment is the part of an enterprise.
ੵ which conducts business operations where it can gain revenues and make expenditures (including the revenues and expenses related to the
transactions made with the other parts of the enterprise).
ੵ whose operating results are regularly monitored by the authorities with the power to make decisions related to the operations of the enterprise in order
to make decisions related to the funds to be allocated to the segment and to evaluate the performance of the segment and
ੵ which has its separate financial information.
Information on business segmentation and related information is explained in Section IV Footnote VIII.
XXVII. Other Disclosures
None.
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Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
SECTION FOUR: INFORMATION ON THE FINANCIAL POSITION AND RISK MANAGEMENT OF THE GROUP
1. Explanations on Shareholders’ Equity:
1. Explanations on Consolidated Shareholders’ Equity
The Bank’s consolidated capital adequacy ratio is 21.84%. (31.12.2021: 18.69%). The capital adequacy standard ratio has been calculated based on the
Regulation on Shareholder’s Equity of Banks, the Regulation on Measurement and Assessment of Capital Adequacy of Bank and other legal regulations
related with BRSA decisions dated 21.12.2021, numbered 9996 and dated 28.04.2022, numbered 10188. Within the scope of the BRSA decisions, the
amount subject to credit risk has been calculated by using the CBRT exchange rates as of 31.12.2021, and the shareholders’ equity has been calculated
without taking into account the negative effects of financial assets in the portfolio of “Financial Assets Through Other Comprehensive Income” as of
21.12.2021.
COMMON EQUITY TIER I CAPITAL
Paid-in Capital to be Entitled for Compensation after All Creditors
Share Premium
Legal Reserves
Other Comprehensive Income According to TAS
Profit
Net Current Period Profit
Prior Period Profit
Bonus Shares from Associates, Subsidiaries and Joint-Ventures not Accounted in Current Period’s Profit
Minority Shares
Common Equity Tier I Capital Before Deductions
Deductions From Common Equity Tier I Capital
Valuation adjustments calculated as per the article 9, (i) of the Regulation on Bank Capital
Current
Period
Prior Period
11,615,938
6,115,938
138,551
143,633
58,096,893
50,721,897
68,326,750
23,224,481
61,471,023
13,502,913
61,598,670
13,541,060
(127,647)
(1,117)
(38,147)
(1,117)
3,350,917
2,286,331
202,998,955
95,994,076
Current
Period
Prior Period
7,376,514
3,779,378
195,622,441
92,214,698
2,931,155
1,586,764
2,931,155
1,586,764
Total Deductions from Common Equity Tier 1
Total Common Equity Tier I capital
ADDITIONAL TIER I CAPITAL
Privileged stocks not included in common equity and share premiums
Debt Instruments and the Related Issuance Premiums Defined by the BRSA
Debt Instruments and the Related Issuance Premiums Defined by the BRSA (Covered by Temporary Article 4)
Shares of Third Parties in Additional Tier I Capital
Shares of Third Parties in Additional Tier I Capital (Covered by Temporary Article 3)
Additional Tier I Capital before Deductions
Deductions from Additional Tier 1 Capital
Direct and Indirect Investments of the Bank on its own Additional Core Capital
Investments in Equity Instruments Issued by Banks or Financial Institutions Invested in Bank’s Additional Tier I
Capital and Having Conditions Stated in the Article 7 of the Regulation
Total of Net Long Positions of the Investments in Equity Items of Unconsolidated Banks and Financial Institutions
where the Bank Owns 10% or less of the Issued Share Capital Exceeding the 10% Threshold of above Tier I Capital
The Total of Net Long Position of the Direct or Indirect Investments in Additional Tier I Capital of Unconsolidated
Banks and Financial Institutions where the Bank Owns more than 10% of the Issued Share Capital
Other items to be defined by the BRSA
Items to be Deducted from Tier 1 Capital during the Transition Period
Goodwill and Other Intangible Assets and Related Deferred Taxes not deducted from Tier 1 Capital as per the
Temporary Article 2, Clause 1 of the Regulation on Measurement and Evaluation of Capital Adequacy of Banks (-)
Net Deferred Tax Asset/Liability not deducted from Tier 1 Capital as per the Temporary Article 2, Clause 1 of the
Regulation on Measurement and Evaluation of Capital Adequacy of Banks (-)
Current and prior periods' losses not covered by reserves, and losses accounted under equity according to TAS
2,921,913
1,144,288
Deduction from Additional Tier 1 Capital when there is not enough Tier II Capital (-)
138,681
27,994
89,996
27,994
3,739,302
1,965,525
548,624
551,575
Leasehold improvements on operational leases
Goodwill Netted with Deferred Tax Liabilities
Other Intangible Assets Netted with Deferred Tax Liabilities Except Mortgage Servicing Rights
Remaining after deducting from the related deferred tax liability with the deferred tax asset based on future taxable
income, except for deferred tax assets based on temporary differences
Differences Arise When Assets and Liabilities Not Held at Fair Value, are Subjected to Cash Flow Hedge
Accounting
Total Credit Losses That Exceed Total Expected Loss Calculated According to the Regulation on Calculation of
Credit Risk by Internal Ratings Based Approach
Securitization Gains
Unrealized Gains and Losses from Changes in Bank’s Liabilities’ Fair Values due to Changes in Creditworthiness
Net Amount of Defined Benefit Plans
Direct and Indirect Investments of the Bank on its own Tier 1 Capital
Shares Obtained against Article 56, Paragraph 4 of the Banking Law
Total of Net Long Positions of the Investments in Equity Items of Consolidated Banks and Financial Institutions
where the Bank owns 10% or less of the Issued Share Capital Exceeding the 10% Threshold of above Tier I Capital
Total of Net Long Positions of the Investments in Equity Items of Consolidated Banks and Financial Institutions where
the Bank owns more than %10 % of the Issued Share Capital Exceeding the 10% Threshold of above Tier I Capital
Mortgage Servicing Rights (amount above 10% threshold of above Tier I capital)
Deferred Tax Assets Arising from Temporary Differences (amount above 10% threshold of above Tier I Capital)
Amount Exceeding the 15% Threshold of Tier 1 Capital as per the Article 2, Clause 2 of the Regulation on
Measurement and Evaluation of Capital Adequacy of Banks
The Portion of Net Long Position of the Investments in Equity Items of Unconsolidated Banks and Financial
Institutions where the Bank Owns 10% or more of the Issued Share Capital not deducted from Tier I Capital
Excess Amount arising from Mortgage Servicing Rights
Excess Amount arising from Deferred Tax Assets from Temporary Differences
Other Items to be Defined by the BRSA
Deductions from Tier I Capital in Cases where there are no Adequate Additional Tier I or Tier II Capitals
Total Deductions from Additional Tier I Capital
Total Additional Tier I Capital
2,931,155
1,586,764
Total Tier I Capital (Tier I Capital= Common Equity Tier I Capital + Additional Tier I Capital)
198,553,596
93,801,462
TIER II CAPITAL
Debt Instruments and the Related Issuance Premiums Defined by the BRSA
Debt Instruments and the Related Issuance Premiums Defined by the BRSA (Covered by Temporary Article 4)
Shares of Third Parties in Additional Tier I Capital
Shares of Third Parties in Additional Tier I Capital (Covered by Temporary Article 3)
25,342,500
22,518,677
1,418,336
1,046,800
884,387
Provisions (Amounts explained in the first paragraph of the article 8 of the Regulation on Bank Capital)
12,249,588
7,483,983
Tier II Capital before Regulatory Adjustments
Deductions from Tier II Capital
Direct and Indirect Investments of the Bank on its own Tier II Capital (-)
Investments in Equity Instruments Issued by Banks and Financial Institutions Invested in Bank’s Tier II Capital and
Having Conditions Stated in the Article 8 of the Regulation
Total of Net Long Positions of the Investments in Equity Items of Unconsolidated Banks and Financial Institutions
where the Bank Owns 10% or less of the Issued Share Capital Exceeding the 10% Threshold of above Tier I Capital
(-)
The Total of Net Long Position of the Direct or Indirect Investments in Additional Tier I Capital and Tier II Capital of
Unconsolidated Banks and Financial Institutions where the Bank Owns 10% or more of the Issued Share Capital
Exceeding the 10% Threshold of Tier I Capital
39,010,424
31,933,847
Other items to be Defined by the BRSA (-)
Total Deductions from Tier II Capital
Total Tier II Capital
Total Equity (Total Tier I and Tier II Capital)
Deductions from Total Equity
Loans Granted against the Articles 50 and 51 of the Banking Law
Net Book Values of Movables and Immovables Exceeding the Limit Defined in the Article 57, Clause 1 of the
Banking Law and the Assets Acquired against Overdue Receivables and Held for Sale but Retained more than Five
Years
39,010,424
31,933,847
237,564,020
125,735,309
2,650
2,650
1,274
1,194
Other items to be Defined by the BRSA
80
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Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Current
Period
Prior Period
2. Information on instruments to be included in the consolidated capital calculation:
Items to be Deducted from the Sum of Tier I and Tier II Capital (Capital) during the Transition Period
The Portion of Total of Net Long Positions of the Investments in Equity Items of Unconsolidated Banks and
Financial Institutions where the Bank Owns 10% or less of the Issued Share Capital Exceeding the 10% Threshold
of above Tier I Capital not deducted from Tier I Capital, Additional Tier I Capital or Tier II Capital as per the
Temporary Article 2, Clause 1 of the Regulation
The Portion of Total of Net Long Positions of the Investments in Equity Items of Unconsolidated Banks and
Financial Institutions where the Bank Owns more than 10% of the Issued Share Capital Exceeding the 10%
Threshold of above Tier I Capital not deducted from Additional Tier I Capital or Tier II Capital as per the Temporary
Article 2, Clause 1 of the Regulation
The Portion of Net Long Position of the Investments in Equity Items of Unconsolidated Banks and Financial
Institutions where the Bank Owns 10% or more of the Issued Share Capital, of the Net Deferred Tax Assets arising
from Temporary Differences and of the Mortgage Servicing Rights not deducted from Tier I Capital as per the
Temporary Article 2, Clause 2, Paragraph (1) and (2) and Temporary Article 2, Clause 1 of the Regulation
CAPITAL
Total Capital (Total of Tier I Capital and Tier II Capital)
Total Risk Weighted Assets
CAPITAL ADEQUACY RATIOS
Consolidated CET1 Capital Ratio (%)
Consolidated Tier I Capital Ratio (%)
Consolidated Capital Adequacy Ratio (%)
BUFFERS
Total Additional Common Equity Requirement Ratio (a+b+c)
a) Capital Conservation Buffer Ratio (%)
b) Bank-specific Counter-Cyclical Capital Buffer Ratio (%)
c) Systemic Bank Buffer Ratio (%)
Additional CET1 Capital Over Total Risk Weighted Assets Ratio Calculated According to the Article 4 of Capital
Conservation and Counter-Cyclical Capital Buffers Regulation (%)
Amounts Lower Than Excesses as per Deduction Rules
Remaining Total of Net Long Positions of the Investments in Equity Items of Unconsolidated Banks and Financial
Institutions where the Bank Owns 10% or less of the Issued Share Capital
237,561,370
125,734,035
1,087,995,231
672,862,034
17.98
18.25
21.84
4.060
2.500
0.060
1.500
12.25
13.71
13.94
18.69
4.060
2.500
0.060
1.500
7.94
Remaining Total of Net Long Positions of the Investments in Tier I Capital of Unconsolidated Banks and Financial
Institutions where the Bank Owns more than 10% or less of the Issued Share Capital
385.225
280.196
Remaining Mortgage Servicing Rights
Net Deferred Tax Assets arising from Temporary Differences
Limits for Provisions Used in Tier II Capital Calculation
974,110
3,118,976
Optional call date. contingent call dates and
redemption amount
General Loan Provisions for Exposures in Standard Approach (before limit of one hundred and twenty-five per ten
thousand)
20,463,080
17,706,672
General Loan Provisions for Exposures in Standard Approach Limited by 1,25% of Risk Weighted Assets
12,249,588
7,483,983
Total Loan Provision that Exceeds Total Expected Loss Calculated According to Communiqué on Calculation of
Credit Risk by Internal Ratings Based Approach
Total Loan Provision that Exceeds Total Expected Loss Calculated According to Communiqué on Calculation of
Credit Risk by Internal Ratings Based Approach, Limited by 0,6% Risk Weighted Assets
Debt Instruments Covered by Temporary Article 4 (effective between January 1, 2018 - January 1, 2022)
Upper Limit for Additional Tier I Capital Items subject to Temporary Article 4
Amount of Additional Tier I Capital Items Subject to Temporary Article 4 that Exceeds Upper Limit
Upper Limit for Additional Tier II Capital Items subject to Temporary Article 4
Amount of Additional Tier II Capital Items Subject to Temporary Article 4 that Exceeds Upper Limit
1,046,800
17,272,200
Issuer
Türkiye İş Bankası A.Ş.
Unique identifier (CUSIP, ISIN etc.)
US900151AF84-
XS1003016018
US90016BAF58-
XS1623796072
XS2106022754
Governing law(s) of the instrument
Taking into account in equity calculation
It is subject to English Law
except for certain articles that
will be subject to Turkish Law.
Issued within the scope of
BRSA Regulation on Banks’
Equity.
It is subject to English Law
except for certain articles that
will be subject to Turkish Law.
Issued within the scope of
BRSA Regulation on Banks’
Equity.
It is subject to English Law
except for certain articles that
will be subject to Turkish Law.
Issued within the scope of
BRSA Regulation on Banks’
Equity.
Subject to 10% deduction as of 01.01.2015
No
No
No
Eligible at unconsolidated / consolidated
Unconsolidated -Consolidated Unconsolidated -Consolidated Unconsolidated -Consolidated
Instrument type (types to be specified by
each jurisdiction)
Bond
Amount recognized in regulatory capital
(Currency in mil. as of most recent reporting
date)
Par value of instrument (Expressed in million TL)
7,460
Bond
9,325
9,325
Bond
13,988
13,988
Accounting classification
Original date of issuance
Perpetual or dated
Original maturity date
Issuer call subject to prior supervisory
approval
Subordinated Liabilities
Subordinated Liabilities
Subordinated Liabilities
10.12.2013
Dated
10 Years
Yes
29.06.2017
22.01.2020
Dated
11 Years
Yes
Dated
10 Years
Yes
The Bank; (1) provided that
subject to having obtained the
prior approval of the related
legislation, can purchase or
otherwise acquire treasury
stock (2) provided that subject
to having obtained the prior
approval of the BRSA, (a) can
redeem all bonds if any taxes
imposed or levied (b) can
redeem all bonds in case of the
deduction from equity.
The Bank has the option to
repay all of the related bonds
on June 29, 2023 provided
that subject to having obtained
the prior approval of the BRSA.
The Bank; (1) provided that
subject to having obtained the
prior approval of the related
legislation, can purchase or
otherwise acquire treasury
stock (2) provided that subject
to having obtained the prior
approval of the BRSA, (a) can
redeem all bonds if any taxes
imposed or levied (b) can
redeem all bonds in case of the
deduction from equity.
The Bank has the option to
repay all of the related bonds
on January 22, 2025 provided
that subject to having obtained
the prior approval of the BRSA.
The Bank; (1) provided that
subject to having obtained the
prior approval of the related
legislation, can purchase or
otherwise acquire treasury
stock (2) provided that subject
to having obtained the prior
approval of the BRSA, (a) can
redeem all bonds if any taxes
imposed or levied (b) can
redeem all bonds in case of the
deduction from equity.
Subsequent call dates. if applicable
None
Coupons / dividends
Fixed or floating dividend/coupon
Coupon rate and any related index
Existence of a dividend stopper
Fully discretionary, partially discretionary or
mandatory
Existence of step up or other incentive to
redeem
Fixed
7.85 %
None
None
None
None
Fixed
7 %
None
None
None
None
Fixed
7.75 %
None
None
None
Noncumulative or cumulative
Noncumulative
Noncumulative
Noncumulative
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Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Convertible or non-convertible
None
None
None
Issuer
Türkiye İş Bankası A.Ş.
If convertible, conversion trigger (s)
If convertible, fully or partially
If convertible, conversion rate
If convertible, mandatory or optional
conversion
If convertible, specify instrument type
convertible into
If convertible, specify issuer of instrument it
converts into
Write-down feature
If write-down, write-down trigger(s)
In accordance with Regulations
on Equities of Banks.Article
8.2.ğ. bonds have deleted
option from records.
In accordance with Regulations
on Equities of Banks.Article
8.2.ğ bonds have deleted
option from records.
In accordance with Regulations
on Equities of Banks.Article
8.2.ğ. bonds have deleted
option from records.
Due to the losses incurred,
where the Bank is at the
point at which the BRSA may
determine pursuant to Article
71 of the Banking Law that:
(i) its operating license is to
be revoked and the Bank is
liquidated or (ii) the rights
of all of its shareholders
(except to dividends),
and the management and
supervision of the Bank, are
to be transferred to the SDIF
on the condition that losses
are deducted from the capital
of existing shareholders
(occurrence of either condition
means the issuer has become
non-viable).
Due to the losses incurred,
where the Bank is at the
point at which the BRSA may
determine pursuant to Article
71 of the Banking Law that:
(i) its operating license is to
be revoked and the Bank is
liquidated or (ii) the rights
of all of its shareholders
(except to dividends),
and the management and
supervision of the Bank, are
to be transferred to the SDIF
on the condition that losses
are deducted from the capital
of existing shareholders
(occurrence of either condition
means the issuer has become
non-viable)
Due to the losses incurred,
where the Bank is at the
point at which the BRSA may
determine pursuant to Article
71 of the Banking Law that:
(i) its operating license is to
be revoked and the Bank is
liquidated or (ii) the rights
of all of its shareholders
(except to dividends),
and the management and
supervision of the Bank, are
to be transferred to the SDIF
on the condition that losses
are deducted from the capital
of existing shareholders
(occurrence of either condition
means the issuer has become
non-viable)
If write-down, full or partial
Partially or completely
Partially or completely
Partially or completely
If write-down, permanent or temporary
Permanent
Permanent
Permanent
If temporary write-down, description of
write-up mechanism
Position in subordination hierarchy in
liquidation (specify instrument type
immediately senior to instrument)
Paid before shares and the
primary of subordinated debt
and after all the other debts.
Paid before shares and the
primary of subordinated debt
and after all the other debts.
Paid before shares and the
primary of subordinated debt
and after all the other debts.
Incompliance with article number 7 and 8 of
“Own fund regulation”
Yes.
Yes.
Yes.
Details of incompliances with article number 7
and 8 of “Own fund regulation”
To vest conditions stated in
clause of the Article 8 and
don’t vest the conditions stated
in clause of the Article 7.
To vest conditions stated in
clause of the Article 8 and
don’t vest the conditions stated
in clause of the Article 7.
To vest conditions stated in
clause of the Article 8 and
don’t vest the conditions stated
in clause of the Article 7.
Unique identifier (CUSIP, ISIN etc.)
TRSTISB72712
TRSTISB62911
TRSTISB92918
Governing law(s) of the instrument
Taking into account in equity calculation
Is subject to Turkish Law. Has
been issued in accordance
with the BRSA Communiqué
regarding the Equity of Banks.
Is subject to Turkish Law. Has
been issued in accordance
with the BRSA Communiqué
regarding the Equity of Banks.
Is subject to Turkish Law. Has
been issued in accordance
with the BRSA Communiqué
regarding the Equity of Banks.
Subject to 10% deduction as of 01.01.2015
No
No.
No.
Eligible at unconsolidated / consolidated
Instrument type (types to be specified by
each jurisdiction)
Amount recognized in regulatory capital
(Currency ın TL million, as of most recent
reporting data)
Unconsolidated –
Consolidated
Bond
880
Nominal value of instrument (TL Million)
1,100
Unconsolidated - Consolidated Unconsolidated - Consolidated
Bond
800
800
Bond
350
350
Accounting classification
Original date of issuance
Perpetual or dated
Original maturity date
Issuer call subject to prior supervisory
approval
Subordinated Liabilities
Subordinated Liabilities
Subordinated Liabilities
08.08.2017
19.06.2019
26.09.2019
Dated
10 Years
Yes
Dated
10 Years
Yes
Dated
10 Years
Yes
Optional call date, contingent call dates and
redemption amount
The Bank; (1) can purchase
bills that subject to having
obtained the prior approval of
the BRSA and the date which
may not be earlier than fifth
anniversary of the Issue Date
(2) (a) can redeem all bonds if
any taxes imposed or levied (b)
can redeem all bonds in case of
the deduction from equity
The Bank; (1) can purchase
bills that subject to having
obtained the prior approval of
the BRSA and the date which
may not be earlier than fifth
anniversary of the Issue Date
(2) (a) can redeem all bonds if
any taxes imposed or levied (b)
can redeem all bonds in case of
the deduction from equity
The Bank; (1) can purchase
bills that subject to having
obtained the prior approval of
the BRSA and the date which
may not be earlier than fifth
anniversary of the Issue Date
(2) (a) can redeem all bonds if
any taxes imposed or levied (b)
can redeem all bonds in case of
the deduction from equity
Subsequent call dates, if applicable
None.
Interest/Dividend Payment
Fixed or floating coupon/dividend payments
Floating
None.
Floating
None.
Floating
Coupon rate and any related index
Government Debt Security for
5 years+350 base points
Turkish Lira Overnight
Reference Interest Rate
(TLREF) + 193 base points
Government Debt Security for
5 years + 350 base points
Existence of a dividend stopper
Fully discretionary, partially discretionary or
mandatory
Existence of step up or other incentive to
redeem
None.
None.
None.
None.
None.
None.
None.
None.
None.
Noncumulative or cumulative
Non-cumulative
Non-cumulative
Non-cumulative
Convertible into equity shares
None.
None.
None.
If convertible, conversion trigger (s)
If convertible, fully or partially
If convertible, conversion rate
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Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
If convertible, mandatory or optional
conversion
If convertible, specify instrument type
convertible into
If convertible, specify issuer of instrument it
converts into
Write-down feature
If write-down, write-down trigger(s)
In accordance with Regulations
on Equities of Banks, Article
8.2.ğ, bonds have deleted
option from records.
In accordance with Regulations
on Equities of Banks, Article
8.2.ğ, bonds have deleted
option from records.
In accordance with Regulations
on Equities of Banks, Article
8.2.ğ, bonds have deleted
option from records.
Due to the losses incurred,
within the framework of
Article 71 of the Banking
Law, (1) the Bank’s operating
license is to be revoked and
liquidated or (2) the rights
of all of its shareholders
(except to dividends) and
the management and
supervision of the Bank are
to be transferred to the SDIF
on the condition that losses
are deducted from the capital
of existing shareholders
(occurrence of either condition
means the issuer has become
non-viable) based on the
decision of the BRSA.
Due to the losses incurred,
within the framework of
Article 71 of the Banking
Law, (1) the Bank’s operating
license is to be revoked and
liquidated or (2) the rights
of all of its shareholders
(except to dividends) and
the management and
supervision of the Bank are
to be transferred to the SDIF
on the condition that losses
are deducted from the capital
of existing shareholders
(occurrence of either condition
means the issuer has become
non-viable) based on the
decision of the BRSA.
Due to the losses incurred,
within the framework of
Article 71 of the Banking
Law, (1) the Bank’s operating
license is to be revoked and
liquidated or (2) the rights
of all of its shareholders
(except to dividends) and
the management and
supervision of the Bank are
to be transferred to the SDIF
on the condition that losses
are deducted from the capital
of existing shareholders
(occurrence of either condition
means the issuer has become
non-viable) based on the
decision of the BRSA.
If bond can be written-down, full or partially
Partially or Completely
Partially or Completely
Partially or Completely
If bond can be written-down, permanent or
temporary
If temporary write-down, description of write-
up mechanism
Permanent
Permanent
Permanent
Posıtıon in subordination hierarchy in case
of liquidation (instrument type immediately
senior to the instrument)
Paid before shares and the
primary of subordinated debt
and after all the other debts.
Paid before shares and the
primary of subordinated debt
and after all the other debts.
Paid before shares and the
primary of subordinated debt
and after all the other debts.
Incompliance with article number 7 and 8 of
Regulation on Bank Capital
Yes.
Yes.
Yes.
Details of incompliances with article number 7
and 8 of Regulation on Bank Capital
To vest conditions stated in
clause of the Article 8 and
don’t vest the conditions stated
in clause of the Article 7.
To vest conditions stated in
clause of the Article 8 and
don’t vest the conditions stated
in clause of the Article 7.
To vest conditions stated in
clause of the Article 8 and
don’t vest the conditions stated
in clause of the Article 7.
3. Explanations on Reconciliations of Amounts in the Consolidated Capital Items Table and Carrying Amounts
in the Consolidated Financial Statements:
Carrying Amount
Amounts in Equity
Calculation (1)
Shareholders’ Equity
Group Share
Minority Interest
Leasehold improvements on operational leases
Goodwill and intangible assets
Provisions
Subordinated debt
Deductions from shareholders’ equity
Capital
210.052.693
210,052,693
191,250,928
18,801,765
138,681
4,079,813
20,463,080
33,558,745
20,967
203.896.226
203,896,226
196,195,818
7,700,408
(138,681)
(3,767,296)
12,249,588
25,342,500
(20,967)
237,561,370
II. Explanations on Credit Risk
1. Credit risk is defined as the possibility of incurring loss where the counterparty in a transaction, partially or completely fails to meet its contractual
obligations in due time in an agreement with the Bank and its consolidated financial subsidiaries.
Banks and financial institutions subject to consolidation, carry out their placement activities in accordance with the credit limitations stipulated by legal
regulations of the countries in which they operate.
The Parent Bank’s position against the credit risk limits defined by the current legislation is monitored by the Board. Within this framework, loans
extended to Risk Groups and the Parent Bank’s Risk Group, including the Parent Bank; loans in high amounts and limitations regarding the shares in
participations are monitored according to the limits determined in connection with the size of the shareholders’ equity calculated on a bank-only and
consolidated basis.
Credit risk limits of customers are determined depending on the financial situation and loan requirements of the borrowers, in strict compliance with
the relevant banking legislation, within the framework of loan authorization limits of Branches, Regional Offices, Loan Divisions, and the Deputy Chief
Executives responsible for loans, the CEO, the Credit Committee and the Board of Directors. These limits may be changed as may be deemed necessary
by the Bank. Moreover, all commercial credit limits are revised periodically, provided that each period does not exceed a year. Furthermore, the borrowers
and borrower groups forming a large proportion of the overall placement are subject to risk limits in order to provide further minimization of potential risk.
The geographical distribution of borrowers is consistent with the concentration of industrial and commercial activities in Turkey.
The distribution of borrowers by sector is monitored closely for each period and sectoral risk limits have been determined to prevent concentration of risk
in sectoral sense.
The creditworthiness of customers is monitored on a consistent basis by using company rating and scoring models specially developed for this purpose,
and the audit of statements of account received is assured to have been made in accordance with the provisions as stipulated by the relevant legislation
The Parent Bank and its financial affiliates give utmost importance to ensure that loans are furnished with collaterals. In accordance with the credit risk
policy, the allocation decision is not based on the assumption that the collateral can be collected by redeeming it in principle. However, to minimize the
credit risk, an appropriate level of collateral is obtained by accurately analyzing the credit worthiness and credit need of the customer. Legal recourse of
collaterals in case of default, their redemption period, and their ability to maintain their expected value are taken into account from the beginning of the
loan allocation process. Most of the loans extended are collateralized by taking real estate, movable or commercial enterprise under pledge, promissory
notes and other liquid assets as collateral, or by acceptance of bank letters of guarantee and individual or corporate guarantees. The absence of
concentration in terms of collateral is an important element of the credit policy.
Non-performing and impaired loans have been classified in accordance with the “TFRS 9-Financial Instruments” and BRSA’s “Regulation on Procedures
and Principles for Classification of Loans and Provisions to be set aside”. The detailed descriptions of these methods correspond with accounting
practices, are included in Section Three Note VIII.
Credit risk is the risk reduction effects without taking into consideration the total amount of exposures after offsetting transactions with different risk
classes according to the types and amounts of disaggregated risks are listed below the average for the period.
Amount subject to credit risk (1)
Risk Classifications
Conditional and Unconditional Exposures to Central Governments or Central
Banks
Conditional and Unconditional Exposures to Regional Governments or Local
Authorities
Conditional and Unconditional Exposures to Administrative Bodies and Non-
Commercial Undertakings
Conditional and Unconditional Exposures to Multilateral Development Banks
Conditional and Unconditional Exposures to International Organizations
Conditional and Unconditional Exposures to Banks and Brokerage Houses
Conditional and Unconditional Exposures to Corporate
Conditional and Unconditional Retail Exposures
Exposures Secured by Residential Real Estate Property
Exposures Secured by Commercial Real Estate Property
Past Due Loans
Items in Regulatory High-risk Categories
Exposures in the Form of Bonds Secured by Mortgages
Short Term Exposures to Banks, Brokerage Houses and Corporates
Exposures in the Form of Collective Investment Undertakings
Stock Investments
Other Items
Current Period
Risk Amount
Average Risk Amount (2)
451,227,825
396,384,082
192,167
165,994
779,142
81,826,562
539,617,731
265,426,197
34,914,768
32,987,925
6,344,324
92,625,822
9,051,377
88,264,935
44,442,556
256,564
221,724
569,814
78,392,969
498,585,963
211,469,337
29,389,949
31,306,379
6,839,938
61,667,994
5,944,426
58,741,070
33,631,821
(1) The related amounts are calculated in accordance with “Regulation on Equities of Banks”. In this context, part of the expected credit loss of stage 1 and stage 2 up to 1.25 %
of amount subject to credit risk, part; subordinated loans according to fourth article of the regulation, have been taken into consideration in equity calculation. On the other hand,
in the calculation, the amount of equity calculated in accordance with the regulation dated 21.12.2021 and numbered 9996 of the BRSA and the amount based on the credit risk
calculated in accordance with the regulation dated 28.04.2022 and numbered 10188.
(1) The figures represent total risk amounts after credit risk mitigation and after credit conversion factor.
(2) Average risk amount is identified by using arithmetical averages of risk amounts calculated quarterly in the current period reports.
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Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
2. There are certain control limits on forward transactions in terms of counter parties, and the risks taken for derivative instruments are evaluated along
with other potential risks resulting from the market fluctuations.
10. The net values of the collaterals of the Group’s non-performing loans are given below in terms of collateral types and risk matches.
3. As a result of the current level of customers’ needs and the progress in the domestic derivatives market in this particular area, the Parent Bank uses
derivative transactions either for hedging or for commercial purposes.
Type of Collateral
Current Period
Prior Period
Net Value of the Collateral
Loan Balance
Net Value of the Collateral
Loan Balance
Derivative instruments are monitored with consideration that they can always be liquidated in case of need.
Real Estate Mortgage (1)
6,507,435
6,507,435
6,516,872
6,516,872
4. Indemnified non-cash loans are considered as having the same risk weights as unpaid cash loans.
The rating and scoring systems applied by the Parent Bank, includes detailed company analysis and enables rating of all companies and loans without
any restrictions regarding credibility. Loans and companies, which have been renewed, restructured or rescheduled, are rated within the scope of this
system. Specialized loans are evaluated by a special rating system, which is based on the credibility of the counterparty as well as the feasibility and risk
analysis of the cash flows created mainly by the projects undertaken or the asset financed.
5. Determining the country risks of the countries concerned in the context of the current rating system credit transactions carried out abroad, market
conditions, legal constraints and risks related to the country on this issue into account. In addition, banks and other financial institutions credit worthiness
abroad, foreign rating agencies by based on credit ratings that are determined and CDS-IR (based on credit default swaps) a supported developed
degree approach is allocated and monitored.
6.
(i) The share of the Group’s receivables from the top 100 and 200 cash loan customers in the overall cash loan portfolio stands at 27% and 36%
respectively (December 31, 2021: 30%, 39%).
(ii) The share of the Group’s receivables from the top 100 and 200 non-cash loan customers in the overall non-cash portfolio stands at 42% and
54% respectively (December 31, 2021: 46%, 58%).
(iii) The share of the Group’s cash and non-cash receivables from the top 100 and 200 credit customers in the overall assets and non-cash loans
stands at 14% and 19% (December 31, 2021: 16%, 22%).
Companies that are among the top loan customers ranked according to cash, non-cash and total risks are leaders in their own sectors, the loans
advanced to them are in line with their volume of industrial and commercial activity. A significant part of such loans is extended on a project basis, with
their repayment sources being analyzed in accordance with the banking principles to be considered as satisfactory, and associated risks are determined
and duly covered by obtaining appropriate guarantees when deemed necessary.
7. Total value of the Stage 1 and Stage 2 expected credit loss allocated for the credit risk carried by Parent Bank and consodilated companies is TL
16,926,688 (December 31, 2020: TL 11,659,777).
8. The Parent Bank measures the quality of its loan portfolio by applying different rating/scoring models on cash commercial/corporate loans, retail loans
and credit cards. The breakdown of the rating/scoring results, which are classified as “Strong”, “Standard” and “Below Standard” by considering their
default features, is shown below.
The loans whose borrowers’ capacity to fulfill their obligations is very good, are defined as “Strong”, whose borrowers’ capacity to fulfill its obligations in
due time is reasonable, are defined as “Standard” and whose borrowers’ capacity to fulfill their obligations is poor, are defined as “Below Standard”.
Strong
Standard
Below Standard
Table shows rating/scoring results.
Current Period
Prior Period
50.00%
44.71%
5.29%
45.06%
49.68%
5.26%
9. The net values of the collaterals of the Group’s closely monitored loans are given below in terms of collateral types and risk matches.
Type of Collateral
Personal
Current Period
Commercial
and
Corporate
Credit Cards
Personal
Prior Period
Commercial
and
Corporate
Credit Cards
Real Estate Mortgage (1)
1,417,099
13,961,519
1,091,254
12,261,832
Cash Collateral (Cash, securities pledge,
etc.)
48,410
571,392
50,628
544,608
Cash Collateral
Vehicle Pledge
Other (Suretyship, commercial enterprise
under pledge, commercial papers, etc.)
1,884
257,315
1,884
257,315
1,523
274,128
1,523
274,128
9,965,770
9,965,770
8,598,774
8,598,774
(1) The mortgage and/or pledge amounts on which third parties have priorities are deducted from the fair values of collaterals in expertise reports; and after comparing the results
to the mortgage/pledge amounts and loan balances, the smallest figures are considered to be the net value of collaterals.
11. The aging analysis of the recievables past due but not impaired in terms of financial asset classes, is as follows:
Current Period
Loans (1)
Corporate / Commercial Loans (3)
Consumer Loans
Credit Cards
Lease Receivables (1)
Insurance Receivables
Total
31-60 Days (2)
855,693
173,399
229,354
452,940
70,092
35,541
961,326
61-90 Days (2)
496,431
184,153
128,202
184,076
53,594
31,006
581,031
Total
1,352,124
357,552
357,556
637,016
123,686
66,547
1,542,357
(1) The loans classified under close monitoring that are not past due or past due for less than 31 days is TL 77,377,390.
(2) Related figures show only overdue amounts of installment based commercial loans and installment-based consumer loans; the principal amounts of the loans which are not
due as of the balance sheet date are equal to TL 980,910 and TL 1,915,515 respectively.
(3) Includes factoring receivables.
Prior Period
Loans (1)
Corporate / Commercial Loans (3)
Consumer Loans
Credit Cards
Lease Receivables (1)
Insurance Receivables
Total
31-60 Days (2)
669,979
120,934
155,926
393,119
2,996
35,737
708,712
61-90 Days (2)
964,455
689,981
70,167
204,307
92,609
18,038
Total
1,634,434
810,915
226,093
597,426
95,605
53,775
1,075,102
1,783,814
(1) The loans classified under close monitoring that are not past due or past due for less than 31 days is TL 63,984,188.
(2) Related figures show only overdue amounts of installment based commercial loans and installment-based consumer loans; the principal amounts of the loans which are not
due as of the balance sheet date are equal to TL 1,572,925 and TL 1,393,092 respectively.
(3) Includes factoring receivables
Pledge on Wages and Vehicles
3,092,378
Cheques & Notes
Other (Suretyship, commercial enterprise
under pledge, commercial papers, etc.)
369,527
70,586
2,344,742
345,122
13,667
456,308
38,558,904
450,396
36,912,380
Non-collateralized
Total
7,040,513
12,221,280
3,941,709
3,411,799
9,047,472
2,206,344
12,054,708
65,753,208
3,941,709
7,348,819
59,125,081
2,206,344
(1) The mortgage and/or pledge amounts on which third parties have priorities are deducted from the fair values of collaterals in expertise reports; and after comparing the results
to the mortgage/pledge amounts and loan balances, the smallest figures are considered to be the net value of collaterals.
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Türkiye İş Bankası A.Ş.
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
12. Profile of Significant Risk Exposures in Major Regions
Current Period
Domestic
European
Union
OECD
Countries
(2)
Off-Shore
Banking
Regions
USA,
Canada
Other
Countries
Investments
in Associates,
Subsidiaries
and Jointly
Controlled
Entities
Unallocated
Assets/Liabilities
(3)
Total
Prior Period
Domestic
European
Union
OECD
Countries
(2)
Off-Shore
Banking
Regions
USA,
Canada
Other
Countries
Investments
in Associates,
Subsidiaries
and Jointly
Controlled
Entities
Unallocated
Assets/Liabilities
(3)
Total
437,104,238
4,009,835
1,136,971
8,976,781
451,227,825
279,429,592
3,418,735
1,136,972
3,909,363
287,894,662
Risk Groups (1)
Receivables from
Central Governments or
Central Banks
Receivables from
Regional Government or
Domestic Government
Receivables from
Administrative Units
and Non-Commercial
Enterprises
Receivables
from Multilateral
Development Banks
Receivables from
International
Organizations
Receivables from Banks
and Intermediaries
192,141
165,859
657,915
121,227
26
135
45,976,674
19,005,741
11,164,932
5,730
2,531,125
3,142,360
Corporate Receivables
513,925,870
6,007,066
5,226,167
1,802,060
358,182
12,298,386
Retail Receivables
262,831,684
436,757
221,429
2,824
73,375
1,860,128
Receivables Secured by
Residential Property
Non-Performing
Receivables
Receivables are
identified as high risk by
the Board
Secured Marketable
Securities
Short-term Receivables
and Short-term
Corporate Receivables
from Banks and
Intermediaries
Investments as
Collective Investment
Institutions
66,636,467
246,958
58,801
3,294
65,415
891,758
6,203,804
122,606
4,759
1
1,917
11,237
91,559,085
209,372
34,256
437
18,387
804,285
9,051,377
Other Receivables
88,033,703
119,358
10,484
976
100,414
Stock Investments
44,442,556
192,167
165,994
779,142
81,826,562
539,617,731
265,426,197
67,902,693
6,344,324
92,625,822
9,051,377
88,264,935
44,442,556
Risk Groups (1)
Receivables from
Central Governments or
Central Banks
Receivables from
Regional Government or
Domestic Government
Receivables from
Administrative Units
and Non-Commercial
Enterprises
Receivables
from Multilateral
Development Banks
Receivables from
International
Organizations
Receivables from Banks
and Intermediaries
343,323
593,628
10,452
28
74
341,632
22,291
24,705,086
19,110,911
10,029,676
1,405
5,045,838
1,767,373
Corporate Receivables
359,817,099
4,240,863
4,547,213
678,401
577,216
9,653,672
Retail Receivables
169,270,774
260,917
143,745
1,545
37,789
1,546,299
Receivables Secured by
Residential Property
Non-Performing
Receivables
Receivables are
identified as high risk by
the Board
Secured Marketable
Securities
Short-term Receivables
and Short-term
Corporate Receivables
from Banks and
Intermediaries
Investments as
Collective Investment
Institutions
52,329,727
212,708
45,683
85
34,547
653,554
7,577,907
157,363
4,358
1,349
32,721
23,489,023
92,613
12,713
1,377
13,994
267,888
2,683,178
Other Receivables
37,697,899
124,282
456,265
603
85,235
Stock Investments
23,010,720
343,351
604,154
363,923
60,660,289
379,514,464
171,261,069
53,276,304
7,773,698
23,877,608
2,683,178
38,364,284
23,010,720
Total
1,521,680,902 30,815,608 16,842,055
1,814,346
4,186,348 28,085,510
44,442,556
1,647,867,325
Total
957,937,236 27,628,844
15,581,285
682,813 6,848,308
17,938,498
23,010,720
1,049,627,704
(1) The figures represent total risk amounts before credit risk mitigation and after credit conversion factor.
(1) The figures represent total risk amounts before credit risk mitigation and after credit conversion factor.
(2) OECD Countries other than EU countries, USA and Canada.
(3) Assets and liabilities that are not consistently allocated.
(2) OECD Countries other than EU countries, USA and Canada.
(3) Assets and liabilities that are not consistently allocated.
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Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
13. Risk Profile by Sectors or Counterparties:
Current Period
Consolidated
Current Period
Consolidated
(1) (**)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
(10)
(11)
(12)
(13)
(14)
TL
FC
Total
Sectors/Counterparty (*)
Agriculture
Farming and Stockbreeding
Forestry
Fishing
Industry
Mining
Production
93,906
74,933
6,232
12,741
548
509
39
4,317,552
8,727,370
2,670,615
8,622,333
60,752
1,586,185
49,604
55,433
1,075,738
996,712
7,850
71,176
31,312
29,995
56
1,261
554,570
526,825
2,955
24,790
12,284,767
2,516,229
14,800,996
12,058,260
863,662
12,921,922
125,500
1,988
127,488
101,007
1,650,579
1,751,586
3,825,286
4,736
684
255,018,678
16,807,779
11,013,641
3,060,991
11,199,334
38,975,666
186,638,614
153,268,181
339,906,795
114,809
3,707,496
8,991,229
402,755
215,983
33,347
597,064
3,738,014
6,617,173
10,355,187
165,898,698
16,043,915
10,478,706
611,333
8,270,758
38,975,666
166,509,633
77,476,939
243,986,572
Electricity, gas, and water
2,981
4,736
Construction
Services
Wholesale and Retail Trade
Hotel, Food and Beverage Services
1,166,280
170,342,226
1,698,675
250,673
684
2,590
80,128,751
361,109
318,952
2,416,311
2,331,512
45,233,394
8,520,505
5,973,513
727,692
2,684,460
16,390,967
69,174,069
85,565,036
30,771,930
33,536,504
64,308,434
152,193
779,142
81,772,789
195,998,461
71,671,784
29,250,888
1,170,425
18,684,209
7,096,580
2,080,173
4,246,779
243,744,023
339,501,626
583,245,649
79,313,118
41,758,661
15,032,527
414,948
11,838,937
155,804
110,163,400
40,049,270
150,212,670
10,351,450
3,888,329
3,590,014
238,079
634,169
9,688,043
9,264,671
18,952,714
Transportation and Telecommunication
5,883,279
47,480,801
17,262,286
3,465,426
383,812
2,509,097
117,093
32,635,752
44,466,042
77,101,794
Financial Institutions
162,271,082
1
779,142
81,772,789
34,149,134
1,650,773
9,180,663
2,612,080
1,417,444
1,668,724
1,144,398
622,355
12,961,453
2,208,576
629,948
4,083,656
511,512
1,098,580
839,225
1,582
69,464
50,185
4,865
7,490
665,112
7,096,580
2,080,173
3,973,882
71,848,130
223,222,068
295,070,198
1,742,612
407,104
394,238
492,940
9,683,161
8,082,965
17,766,126
3,247,464
961,064
4,208,528
1,812,697
1,487,990
3,300,687
4,665,376
11,967,556
16,632,932
Real Estate and Renting Services
Self-Employment Services
Education Services
Health and Social Services
23,874
59,116
32,985
122,542
Other
Total
53,777
94,443
3,266
706
9,979
275,800,127
187,431
53,773
39,049,646
159,698,759
20,588,913
1,353,904
59,503,249
1,954,797
86,184,762
1,220,111
581,093,039
64,512,412
645,605,451
451,227,825
192,167
165,994
779,142
81,826,562
539,617,731
265,426,197
67,902,693
6,344,324
92,625,822
9,051,377
88,264,935
44,442,556
1,054,532,373
593,334,952
1,647,867,325
(1) Receivables from Central Governments or Central Banks
(2) Receivables from Regional Governments or Local Authorities
(10) Past due receivables
(11) Receivables in regulatory high-risk categories
(3) Receivables from Administrative Bodies and Non-commercial Undertakings
(12) Investments in the nature of collective investment enterprise
(4) Receivables from Multilateral Development Banks
(5) Receivables from International Organizations
(6) Receivables from Banks and Brokerage Houses
(7) Receivables from Corporate Receivables
(8) Receivables from Retail Receivables
(9) Receivables from Secured by Real Estate Property
(13) Other Receivables.
(14)Stock Investments.
(*) Risk amounts after the credit conversions and the effects of credit risk mitigation
(**) Credit Guarantee Fund guaranteed by the undersecreteriat of treasury are included in the
receivables from central governments.
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Türkiye İş Bankası A.Ş.
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
14. Analysis of maturity-bearing exposures according to remaining maturities:
16. Miscellaneous Information According to Type of Counterparty of Major Sectors
Risk Groups (1)
Receivables from Central Governments
or Central Banks
Receivables from Regional Governments
or Domestic Governments
Receivables from Administrative Units
and Non-Commercial Enterprises
The multilateral development banks and
non-contingent receivables
Receivables from Banks and
Intermediaries
Corporate Receivables
Retail Receivables
Collateralized Receivables with Real
Estate Mortgages
Receivables are identified as High Risk
by the Board
Current Period
Remaining Maturities
1 Month
1-3 Months
3-6 Months
6-12 Months
Over 1 Year
Total
20,908,630
7,621,802
7,994,514
15,707,658
202,582,657
254,815,261
1,518
4,127
28,719
16,047
141,753
192,164
6,228
3,365
10,841
1,833
93,183
115,450
555,476
13,487
36,309
171,850
777,122
43,550,130
8,055,535
6,079,379
1,365,919
6,349,794
65,400,757
62,891,194
68,222,367
78,813,656
66,991,109
252,985,763
529,904,089
84,130,312
3,669,684
7,384,229
26,171,353
58,068,129
179,423,707
6,807,665
1,979,415
3,717,384
8,148,099
42,618,363
63,270,926
5,352,329
6,806,407
11,146,787
13,757,131
55,417,773
92,480,427
Total
224,203,482
96,376,189
115,211,818
132,330,999
618,257,415
1,186,379,903
(1) The figures represent total risk amounts before credit risk mitigation and after credit conversion factor.
15. Information on Risk Classes:
In the calculation of the amount subject to credit risk, determining the risk weights related to risk classes stated on the article “Regulation on
Measurement and Evaluation of Capital Adequacy of Banks”, is based on the Fitch Ratings’ and JCR Avrasya Derecelendirme A.Ş. international rating.
“Receivables from Banks and Intermediaries” are receivables from related parties residing in foreign countries against the risk evaluated in class with
“Receivables from Central Governments or Central Banks” are receivables that are evaluated in the class will be the subject of risk weights determined
in accordance with Fitch Ratings issued by the rating of the risk. “Receivables from Banks and Intermediaries” in the class with resident banks and
brokerage firms in the dorm evaluated risk “Corporate Receivables” in the class evaluated dorm resident companies and financial institutions in the
TL-denominated receivables, the risk weights that will be the subject of JCR Avrasya Derecelendirme A.Ş. international rating grades assigned by it are
used.
If a receivable-specific rating is performed, risk weights to be applied on the receivable are determined by the relevant credit rating.
The table related to mapping the ratings used in the calculations and credit quality grades, which is stated in the Annex of Regulation on Measurement
and Evaluation of Capital Adequacy of Banks, is given below:
Significant Sectors/Counterparty
Current Period
1
Agricultural
1.1
1.2
1.3
Farming and Raising Livestock
Forestry
Fishing
2
Industry
2.1
2.2
2.3
Mining
Production
Electricity, gas, and water
3 Construction
4
Services
4.1
4.2
4.3
4.4
4.5
4.6
4.7
4.8
Wholesale and Retail Trade
Hotel, Food and Beverage Services
Transportation and
Telecommunication
Financial Institutions
Real Estate and Renting Services
Self-Employment Services
Education Services
Health and Social Services
5 Other
6
Total
Loans
Depreciated (TFRS 9)
Provisions
Significant Increase in Credit
Risk (Stage 2)
Non-Performing (Stage 3)
Expected Credit Loss (TFRS 9)
663,441
538,527
2,447
122,467
28,864,701
57,053
8,309,606
20,498,042
4,463,901
31,148,829
5,052,379
6,194,339
7,006,805
96,492
6,749,205
1,403,184
78,011
4,568,414
16,608,753
81,749,625
148,819
137,567
877
10,375
12,051,336
196,505
2,281,964
9,572,867
4,035,295
6,845,823
2,010,067
686,120
1,841,693
83,729
1,956,824
182,231
34,211
50,948
4,131,485
27,212,758
182,123
157,807
1,100
23,216
16,407,961
162,861
3,400,474
12,844,626
3,721,587
10,550,405
2,178,284
900,425
2,852,176
25,987
3,356,954
552,021
36,171
648,387
4,341,281
35,203,357
17. Information on Value Adjustments and Change in Credit Provisions
Beginning Balance
Provisions
Reversal of
Provisions
Other Value
Adjustments
Ending Balance
Stage 3 Provisions
Stage 1 and Stage 2
Provisions
15,898,604
14,229,253
(9,562,267)
16,926,688
16,266,440
(13,836,572)
20,565,590
19,356,556
Credit Quality Grades
1
2
3
4
5
6
Risk Rating
AAA via AA-
A+ via A-
BBB+ via BBB-
BB+ via BB-
B+ via B-
CCC+ and lower
18. Exposures Subject to Countercyclical Capital Buffer
Explanations about exposures subject to consolidated private sector receivables:
Risk Amounts according to Risk Weights:
Risk Weight
0%
20%
35%
50%
75%
100%
150%
250%
Other
Mitigation in
Shareholders’
Equity
Amount
Before
Credit Risk
Mitigation (1)
Amount
After
Credit Risk
Mitigation
518,653,850
104,139,408 35,026,240 103,532,942 174,789,442 629,416,463 61,200,551 385,225 38,736,580
3,905,977
531,929,037 102,489,634
34,914,768
102,807,950 169,278,670 606,445,362 60,880,099 385,225 38,736,580
3,905,977
(1) The figures represent total risk amounts before credit risk mitigation and after credit conversion factor.
Turkey
TRNC
England
Germany
Albania
Cayman Islands
Malta
Kosovo
Georgia
Iraq
Other
Country
RWA Calculations for Private
Sector Loans in Banking Book
RWA calculations for Trading Book
Total
711,879,245
4,719,899
716,599,144
5,860,718
4,801,700
3,033,620
1,910,228
1,801,937
1,523,732
1,517,770
1,287,639
1,268,420
4,939,039
492
1,696
5,860,718
4,802,192
3,035,316
1,910,228
1,801,937
1,523,732
1,517,770
1,287,639
1,268,420
67,619
5,006,658
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Türkiye İş Bankası A.Ş.
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
III.
Explanations on Currency Risk
The exposed currency risk of the Group is result of the difference between the assets denominated in and indexed to foreign currencies and liabilities
denominated in foreign currencies. Furthermore, parity fluctuations of different foreign currencies are another element of the currency risk.
The currency risk of the Parent Bank is managed by the internal currency risk limits which are established as a part of the Parent Bank’s risk policies. The
Assets and Liabilities Committee and the Assets and Liabilities Management Unit meet regularly to take the necessary decisions for hedging exchange
rate and parity risks, within the framework of the determined by the “Net Foreign Currency Overall Position/ Shareholders’ Equity” ratio, which is a part
of the legal limits requirement and the internal currency risk limits specified by the Board of Directors. Foreign exchange risk management decisions are
strictly applied.
In measuring the exposed currency risk of the Group, the Standard Method, the Value at Risk Model (VAR) and Expected Shortfall Model are used as
applied in the statutory reporting.
Measurements made for the Parent Bank within the scope of the Standard Method are carried out on a monthly basis and form the basis of determining
the capital requirement for hedging currency risk.
Risk measurements made within the context of the VAR are practiced on a daily basis using the historical and Monte Carlo simulation methods. Scenario
analyses are conducted to support the calculations made within the VAR context. Expected loss calculations are also carried out daily.
The results of the measurements made on currency risk are reported to the Key Management and the risks are closely monitored by taking into account
the market and the economic conditions.
The Parent Bank’s foreign currency purchase rates at the date of balance sheet and for the last five working days of the period announced by the
Parent Bank in TL are as follows:
Date
USD
EUR
December 31, 2022
December 30, 2022
December 29, 2022
December 28, 2022
December 27, 2022
December 26, 2022
18.6500
18.6500
18.6150
18.6031
18.5821
18.5344
19.9247
19.9247
19.8629
19.7565
19.7900
19.7020
The Parent Bank’s last 30-days arithmetical average foreign currency purchase rates:
USD: 18,5001 TL
EURO: 19,6013 TL
Sensitivity to currency risk:
The Group’s sensitivity to any potential change in foreign currency rates has been analyzed. Within this framework, 10% change is anticipated in USD,
EUR, RUB and GEL currencies and the possible impact of the related change is presented below. 10% is the ratio that is used in the internal reporting of
the Parent Bank.
% Change in Foreign Currency
Effects on Profit/Loss (1)
Current Period
Priod Period
USD
EURO
RUB
GEL
(1) Indicates the values before tax.
10 % increase
10 % decrease
10 % increase
10 % decrease
10 % increase
10 % decrease
10 % increase
10 % decrease
875,154
(875,154)
969,497
(969,497)
368,974
(368,974)
170,580
(170,580)
416,075
(416,075)
471,624
(471,624)
155,517
(155,517)
84,092
(84,092)
Information on currency risk:
Current Period
Assets
EUR
USD
Other FC
Total
Cash (Cash in Vault, Foreign Currency Cash, Money in Transit, Cheques
Purchased) and Balances with the Central Bank of Turkey (1)
59,015,579
88,221,144
32,890,577
180,127,300
Banks
12,136,851
9,224,403
10,445,874
31,807,128
Financial Assets at Fair Value through Profit/Loss (2)
3,052,881
10,631,762
8,846,315
22,530,958
Money Market Placements
Financial Assets at Fair Value through Other Comprehensive Income
6,775,124
63,021,449
10,121
69,806,694
Loans (2) (3)
190,609,167
193,487,274
8,414,492
392,510,933
Investments in Associates, Subsidiaries and Jointly Controlled Entities (Joint
Ventures)
190,321
190,321
Financial Assets measured at Amortized Cost
2,138,078
10,794,897
2,711,201
15,644,176
Derivative Financial Assets Held for Risk Management (2)
Tangible Assets (2)
Intangible Assets (2)
Other Assets (2)
Total Assets
Liabilities
Bank Deposits
Foreign Currency Deposits (4)
Money Market Funds
Funds Provided from Other Financial Inst,
Marketable Securities Issued (5)
Miscellaneous Payables
214,278
138,162
2,794
146,316
138,162
363,388
2,502,024
11,122,208
1,984,561
15,608,793
276,634,303 386,644,093
65,449,457
728,727,853
4,635,462
2,929,950
422,848
7,988,260
182,137,536
276,372,336
105,120,711
563,630,583
586,948
12,771,070
104,263
13,462,281
49,389,441
94,410,183
80,481
143,880,105
77,342,752
758,983
78,101,735
3,328,297
9,799,690
1,153,723
14,281,710
Derivative Financial Liabilities Held for Risk Management
134,010
134,010
Other Liabilities (2) (6)
Total Liabilities
Net Balance Sheet Position
Net Off Balance Sheet Position
Derivative Financial Assets (7)
Derivative Financial Liabilities (7)
Non-Cash Loans
Prior Period
Total Assets
Total Liabilities
Net Balance Sheet Position
Net Off Balance Sheet Position
Derivative Financial Assets
Derivative Financial Liabilities
Non-Cash Loans
8,181,651
15,781,825
1,496,917
25,460,393
248,259,335
489,541,816
109,137,926 846,939,077
28.374.968 -102.897.723 -43.688.469
-118.211.224
-20.551.336
115.206.059
44.954.458
139.609.181
44.021.624
180.200.359
49.667.448
273.889.431
64.572.960
64.994.300
4.712.990
134.280.250
68.534.599
81.161.704
9.262.376
158.958.679
258,292,181
292,085,026
45,057,884 595,435,091
214,594,131 393,606,930
77,543,134
685,744,195
43,698,050 (101,521,904)
(32,485,250)
(90,309,104)
(38,937,607)
107,856,716
34,162,909
103,082,018
30,518,476
170,928,671
39,148,208
240,595,355
69,456,083
63,071,955
4,985,299
137,513,337
63,318,833
81,181,608
8,702,425
153,202,866
(1) Precious metals accounts amounting TL 31,128,501 are included.
(2) In accordance with the principles of the “Regulation on the Calculation and Implementation of Foreign Currency Net General Position/Equity Standard Ratio by Banks on
Consolidated and Non-Consolidated Basis”, Derivative Financial Instruments Foreign Currency Income Accruals (TL 6,383,060) Operating Lease Development Costs (TL
6,957), Deferred Tax Asset (TL 10,425), Prepaid Expenses and Taxes (TL 400,1478, expected credit loss for stage 1 and stage 2 (TL (13,356,566) Intangible Assets (TL
199,443) Assets Held for Sale and Related to Discontinued Operations(Net)(TL 20,359) in assets and Derivative Financial Instruments Foreign Currency Expense Accruals
(TL 2,155,543), Shareholders’ Equity (TL (3,666,898)) and expected credit loss for stage 1 and stage 2 for non-cash loans (TL 170,537) are not taken into consideration in the
currency risk measurement.
(3) Includes leasing and factoring receivables and foreign currency indexed loans which are recognized under TL account. Of the total amount of TL 1,882,112 of the
aforementioned loans; TL 989,073 is USD indexed, TL 887,872 is EUR indexed, TL 401 is CHF indexed and TL 4,766 is GBP indexed.
(4) The item includes TL 74,492,798 precious metals deposit accounts.
(5) Includes Tier 2 subordinated bond which is classified on the balance sheet as subordinated loan.
(6) The borrower funds are presented in the “Other Liabilities” according to their type of currency.
(7) The derivative transactions in the context of forward foreign currency options and foreign currency forwards definitions included in the Communiqué above are taken into
consideration.
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Türkiye İş Bankası A.Ş.
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
IV.
Explanations on Interest Rate Risk
a. Interest sensitivity of assets, liabilities and off-balance sheet items (Based on time remaining to repricing date):
Interest rate risk is defined as the impairment in the value of the interest sensitive assets, liabilities and off-balance sheet items due to interest rate
fluctuations. A method which takes into consideration the effect of standard interest shocks on the economic values of the Parent Bank’s on, and off-
balance sheet interest sensitive accounts is used for measuring the interest rate risk arising from the banking accounts, whereas the interest rate risk
related to interest sensitive financial instruments followed under trading accounts is assessed within the scope of market risk.
Potential effects of interest rate risk on the Parent Bank’s assets and liabilities, market developments, the general economic environment and
expectations are regularly followed in meetings of the Asset-Liability Management Committee, where further measures to reduce risk are taken when
necessary.
The Parent Bank’s on and off-balance sheet interest sensitive accounts other than the assets and liabilities exposed to market risk are monitored and
controlled by the limits on the ratio of structural interest rate risk to equity and tier 1 capital determined by the Board within the scope of “Asset-Liability
Management Risk Policy”. Moreover, scenario analyses formed in line with the average maturity gaps and the historical data and expectations are also
used in the management of the related risk.
In addition, the effect of the change in interest rates on the Parent Bank's net interest income is analyzed regularly. Within this scope, the ratio of the
change expected to occur in net interest income under carious scenarios to the limit on Tier I capital is monitored and regularly reported to the top
management.
Interest rate sensitivity:
In this part, the sensitivity of the Bank’s assets and liabilities to the interest rates has been analyzed assuming that the yearend balance figures were the
same throughout the year. Mentioned analysis shows how the FC and TL changes in interest rates by one point during the one-year period affect the
Group's income accounts and shareholders' equity under the assumption maturity structure and balances are remain the same all year round at the end
of the year.
During the measurement of the Group’s interest rate sensitivity, the profit/loss on the asset and liability items that are evaluated with market value are
determined by adding to/deducting from the difference between the expectancy value of the portfolio after one year in case there is no change in
interest rates and the value of the portfolio one year later, which is measured after the interest shock, the interest income to be additionally earned/to be
deprived of during the one year period due to the renewal or repricing of the related portfolio at the interest rates formed after the interest shock.
On the other hand, in the profit/loss calculation of assets and liabilities that are not evaluated by the current market prices, it is assumed that assets and
liabilities with fixed interest rates will be renewed at maturity date and the assets and liabilities having variable interest rates will be renewed at the end of
repricing period with the market interest rates generated after the interest shock.
Within this context, ceteris paribus, the possible changes that may occur in the Bank’s profit and shareholders’ equity in case of 100 base point increase/
decrease in TL and FC interest rates on the reporting day are given below:
% Change in the Interest Rate (1)
Effect On Profit/Loss
Effect on Equity (2)
TL
FC
Current Period
Prior Period
Current Period
Prior Period
100 bps increase
100 bps increase
100 bps decrease
100 bps decrease
1,008,028
(1,166,480)
977,167
(1,068,195)
(3,977,233)
4,308,848
(2,608,623)
2,871,166
(1) Changes in interest rates is calculated assuming that the expectations reflected in inflation. The effects on the profit/loss and shareholders’ equity are stated with their before
tax values.
(2) The effect on the shareholders’ equity is arising from the change of the fair value of securities followed under Financial Assets at Fair Value through other comprehensive
income.
Current Period
Up to 1 Month
1-3 Months
3-12 Months
1-5 Years
5 Years and
Over
Non-interest
Bearing
Total
Assets
Cash (Cash in Vault,
Foreign Currency
Cash, Money in Transit,
Cheques Purchased)
and Balances with the
Central Bank of Turkey
7,453,621
194,392,278
201,845,899
Banks
20,803,477
2,766,863
210,855
15,213,620
38,994,815
Financial Assets at Fair
Value through Profit/
Loss (1)
Money Market
Placements
Financial Assets at Fair
Value Through Other
Comprehensive Income
Loans (2)
Financial Assets
Measured at Cost
Other Assets (3)
6,895,940
8,859,810
4,802,754
9,381,655
80,451
23,114,891
53,135,501
5,032,776
685,950
476,616
6,195,342
45,203,231
27,170,040
46,089,905
44,113,918
37,416,879
2,131,604
202,125,577
236,210,546
102,037,625
293,405,120
222,419,187
57,350,982
940,273
912,363,733
17,770,899
22,876,252
25,522,859
27,002,656
13,783,495
106,956,161
13,105,004
153,130
287,067
221,470
180,047,870
193,814,541
Total Assets
352,475,494 164,549,670
370,795,176 303,138,886
108,631,807 415,840,536
1,715,431,569
Liabilities
Bank Deposits
Other Deposits
4,621,637
2,508,509
2,756,604
228,279
1,192,084
11,307,113
366,805,419
100,178,746
39,502,856
3,446,087
884,470
430,511,241
941,328,819
Money Market Funds
44,232,857
5,347,374
1,648,534
Miscellaneous Payables
13,202,152
164,956
184,831
11,391
43,442
51,240,156
136,757,803
150,353,184
14,199,907
4,368,607
10,823,154
37,789,516
24,722,121
91,903,305
155.981.599
155,981,599
45.719.157
65.261.065
35.110.948
7.629.899
2.260.530
Institutions
45,719,157
65,261,065
35,110,948
7,629,899
2,260,530
Other Liabilities (5) (6)
4,253,060
3,722,352
3,373,765
351,926
1,408,118
300,208,172
313,317,393
Total Liabilities
493,034,189
181,551,609
93,400,692
49,500,540
29,275,239
868,669,300
1,715,431,569
Balance Sheet Long
Position
Balance Sheet Short
Position
Off Balance Sheet Long
Position
Off Balance Sheet
Short Position
277,394,484
253,638,346
79,356,568
610,389,398
(140,558,695)
(17,001,939)
(452,828,764)
(610,389,398)
7,997,276
21,622,707
29,619,983
(6,956,126)
(10,009,441)
(7,856,740)
(24,822,307)
Total Position
(132,561,419)
4,620,768 270,438,358 243,628,905
71,499,828 (452,828,764)
4,797,676
(1) Includes Derivative financial assets
(2) Includes leasing and factoring receivables.
(3) The expected loss provisions are shown in non-Interest column.
(4) Includes Tier 2 subordinated bond which is classified on the balance sheet as subordinated loan.
(5) Shareholders’ equity is included in “non-interest bearing” column.
(6) The borrower funds are presented in “Up to 1 month” column in other liabilities.
Marketable Securities
Issued (4)
Funds Provided from
Other Financial
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354 İşbank 2022 Integrated Annual Report
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Türkiye İş Bankası A.Ş.
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Interest rate sensitivity of assets, liabilities and off-balance sheet items (Based on time remaining to repricing date):
b. Parasal finansal araçlara uygulanan ortalama faiz oranları:
Prior Period
Up to 1 Month
1-3 Months
3-12 Months
1-5 Years
5 Years and
Over
Non-interest
Bearing
Total
Current Period
EUR
%
USD
%
JPY
%
TL
%
Assets
Cash (Cash in Vault,
Foreign Currency
Cash, Money in Transit,
Cheques Purchased)
and Balances with the
Central Bank of Turkey
14,634,682
169,386,543
184,021,225
Banks
Assets
Cash (Cash in Vault. Foreign Currency Cash. Money in Transit. Cheques
Purchased) and Balances with the Central Bank of Turkey
Banks
7,522,586
1,446,001
159,067
26,067,588
35,195,242
Financial Assets at Fair
Value through Profit/
Loss (1)
Money Market
Placements
Financial Assets at Fair
Value Through Other
Comprehensive Income
Loans (2)
Financial Assets
Measured at Cost
Other Assets (3)
9,268,937
10,152,530
7,785,436
6,127,712
300,260
5,596,590
39,231,465
2,061,138
775,354
156,572
2,993,064
21,648,338
19,425,001
17,779,889
26,013,946
23,874,084
1,202,401
109,943,659
115,872,992
60,061,057
177,179,502
206,721,651
53,925,304
982,214
614,742,720
8,800,527
13,843,894
17,813,725
8,513,617
2,573,565
51,545,328
5,055,341
76,608
236,851
149,824
81,212,746
86,731,370
Total Assets
184,864,541
105,780,445
221,111,042
247,526,750
80,673,213 284,448,082
1,124,404,073
Liabilities
Bank Deposits
Other Deposits
1,639,400
1,720,923
713,064
1,050,890
1,302,757
6,427,034
255,680,706
36,249,663
24,356,836
3,437,720
962,851
290,564,393
611,252,169
Money Market Funds
46,847,607
2,541,576
4,322,725
Miscellaneous Payables
2,230,493
60,121
46,585
25,945
26,822
53,737,853
73,969,740
76,333,761
Marketable Securities
Issued (4)
Funds Provided
from Other Financial
Institutions
2,104,244
11,647,841
22,621,436
35,838,166
17,344,902
89,556,589
12,455,710
53,579,724
50,954,407
9,616,624
2,317,218
128,923,683
Other Liabilities (5) (6)
5,230,548
4,443,819
3,981,506
1,373,120
1,376,106
141,767,885
158,172,984
Money Market Placements
Total Liabilities
326,188,708
110,243,667
106,996,559
51,369,287
22,001,077
507,604,775 1,124,404,073
Financial Assets at Fair Value Through Other Comprehensive Income
Balance Sheet Long
Position
Balance Sheet Short
Position
Off Balance Sheet Long
Position
Off Balance Sheet Short
Position
114,114,483
196,157,463
58,672,136
368,944,082
(141,324,167)
(4,463,222)
(223,156,693)
(368,944,082)
3,422,542
16,148,347
19,570,889
(1,052,722)
(9,325,566)
(6,159,597)
(16,537,885)
Total Position
(137,901,625)
11,685,125
113,061,761
186,831,897
52,512,539 (223,156,693)
3,033,004
(1) Includes Derivative financial assets.
(2) Includes leasing receivablesand factoring receivables.
(3) The expected loss provisions are shown in non-Interest column.
(4) Includes Tier 2 subordinated bond which is classified on the balance sheet as subordinated loan.
(5) Shareholders’ equity is included in “non-interest bearing” column.
(6) The borrower funds are presented in “Up to 1 month” column in other liabilities.
Loans (1)
Financial Assets Measured at Amortized Cost
Liabilities
Bank Deposits
Other Deposits
Money Market Funds
Miscellaneous Payables
Debt Securities Issued (2)
Funds
Funds Provided from Other Financial Institutions
(1) Includes leasing receivablesand factoring receivables.
(2) Includes Tier 2 subordinated bond which is classified on the balance sheet as subordinated loan.
Financial Assets at Fair Value through Profit/Loss
Money Market Placements
Financial Assets at Fair Value Through Other Comprehensive Income
Loans (1)
Financial Assets Measured at Cost
Liabilities
Bank Deposits
Other Deposits
Money Market Funds
Miscellaneous Payables
Debt Securities Issued (2)
Funds
Funds Provided from Other Financial Institutions
(1) Includes leasing receivables and factoring receivables.
(2) Includes Tier 2 subordinated bond which is classified on the balance sheet as subordinated loan.
2.50
1.22
3.00
3.89
5.94
3.58
0.77
0.12
1.48
1.50
3.39
4.25
2.77
5.23
5.84
8.12
6.91
4.70
0.65
6.61
6.59
2.50
6.11
7.27
20.21
13.59
16.47
31.73
20.59
23.92
12.64
11.63
9.71
20.49
7.50
15.26
Prior Period
EUR
%
USD
%
JPY
%
TL
%
Assets
Cash (Cash in Vault. Foreign Currency Cash. Money in Transit. Cheques
Purchased) and Balances with the Central Bank of Turkey
Banks
Financial Assets at Fair Value through Profit/Loss
0.35
1.92
(2.60)
3.86
4.29
3.11
0.35
0.06
0.65
0.10
1.57
0.22
2.70
5.21
5.30
5.03
1.09
0.14
1.45
6.43
0.20
2.01
8.50
18.39
15.78
16.63
21.47
18.30
19.21
15.50
11.57
14.19
18.37
11.00
16.69
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Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
V.
Explanations on Equity Shares Risk Arising from Banking Book
VI.
Explanations on Liquidity Risk Management and Consolidated Liquidity Coverage Ratio
a. Accounting policies related to equity investments in associates and subsidiaries can be seen in the Section Three Note III.2.
b. Balance sheet value of equity investment, fair value and for publicly traded, if the market value is different from the fair value comparison to the market
price:
Book Value
Comparison
Fair Value
Market Value
Investment in Shares
Quoted
Investment in Shares Group A
Subsidiaries
Financial Subsidiaries
Non-Financial Subsidiaries (1)
39,036,192
132,854,654
Non-Quoted
Associate and Subsidiaries
Financial Subsidiaries (2)
Non-Financial Subsidiaries
Subsidiaries
Financial Subsidiaries
Non-Financial Subsidiaries
(1) Türkiye Şişe ve Cam Fabrikaları A.Ş.
385,225
20,120
3,412,997
(2) Accounted under the equity method in the consolidated financial statements according to TAS 28 and 1st clause of Article 5 of the “Communiqué on the Preparation of
Consolidated Financial Statements”.
(3) Refers to the total market value of the company.
c. Information on revaluation surpluses and unrealised gains/losses on equity securities and results included in Common Equity and Tier II Capital:
Portfolio
Private Equity
Investments
Shares Traded on a
Stock Exchange
Other Stocks
Total
Realised
Gains/losses
During the
period
Revaluation Increases
Unrealized Gains and Losses
Total
Including into Tier I
Capital (1)
Total
Including into
Tier I Capital
Total
37,446,292
37,446,292
1,110,254
1,110,254
38,556,546
38,556,546
(1) Represents the amounts reflected to equity according to the equity method.
d. Capital requirement based on per equity shares:
Portfolio
Carrying Value
Total RWA
Minimum Capital Requirement
Private Equity Investments
Share Traded on a Stock Exchange
Other Stocks
Total
39,036,192
3,818,342
42,854,534
39,036,192
4,396,180
43,432,372
3,122,895
351,694
3,474,589
Liquidity risk may occur as a result of funding long-term assets with short-term liabilities. The Groups’ liquidity is managed by the Asset-Liability
Management Committee in accordance with the business strategies, legal requirements, current market conditions and expectations regarding the
economic and financial conjuncture.
The Parent Bank’s principal source of funding is deposits. Although the average maturity of deposits is shorter than that of assets as a result of the
market conditions, the Bank’s wide network of branches and stable core deposit base are its most important safeguards of funding. Additionally, the
Bank borrows medium and long-term funds from institutions abroad. Concentration limits are generally used in deposit and non-deposit borrowings in
order to prevent adverse effects of concentrations in the liquidity risk profile of the Bank.
In order to meet the liquidity requirements that may arise from market fluctuations, considerable attention is paid to the need to preserve liquidity and
efforts in this respect are supported by projections of Turkish Lira and Foreign Currency (FC) cash flows. The term structure of TL and FC deposits, their
costs and amounts are monitored on a daily basis. During these studies historical events and future expectations are taken into account as well, based
upon cash flow projections, prices are differentiated for different maturities and measures are taken accordingly to meet liquidity requirements. Moreover,
potential alternative sources of liquidity are determined to be used in case of extraordinary circumstances.
The liquidity risk exposure of the Group has to be within the risk capacity limits which are prescribed by the legislation and the Group’s risk appetite
defined in its business strategy. It is essential for the Group to have an adequate level of unencumbered liquid asset stock which can be sold or pledged,
in case a large amount of reduction in liquidity sources occurs. The level of liquid asset buffer is determined in accordance with the liquidity risk
tolerance which is set by the Board of Directors. Asset-Liability Management Committee is responsible for monitoring the liquidity position, determining
appropriate sources of funds and deciding the maturity structure in accordance with the limits which are set by the Board of Directors.
The Treasury Division is responsible for monitoring the liquidity risk, in accordance with the Asset-Liability Management Risk Policy limits, objectives set
out in the business plan and the decisions taken at the meetings of Asset-Liability Management Committee. The Treasury Division is also responsible
for making liquidity projections and taking necessary precautions to reduce liquidity risk, by using the results of stress testing and scenario analysis.
Within this scope, Treasury Division is monitoring the Turkish Lira (TL) and foreign currency (FC) liquidity position instantly and prospectively based on
the information provided from the branches, business units and IT infrastructure of the Bank. The assessment of long-term borrowing opportunities is
carried out regularly in order to balance the cash inflows and outflows and to mitigate the liquidity risk. The Bank creates liquidity through repurchase
agreements and secured borrowings based on the high quality liquid asset portfolio, through securitization and other structured finance products which
are created from the asset pools like credit card receivables and retail loans.
The Bank applies liquidity stress tests to measure liquidity risk. In this approach, in liquidity stress scenarios in which parameters are determined by the
Board of Directors, the ability of the Bank’s liquid assets’ in covering cash outflows within a one-month horizon has been described. Liquidity adequacy
limits for TL and FC are determined by Board of Directors, based on the liquidity requirements and risk tolerance of the Bank. The liquidity risk is
measured by the Risk Management Division and results are reported to the related executive functions, senior management and Board of Directors.
It is essential for the Bank to monitor the liquidity position and funding strategy continuously. In case of a liquidity crisis that may arise from unfavorable
market conditions, extraordinary macroeconomic situations and other reasons which are beyond the control of the Bank. “Emergency Action and
Funding Plan” is expected to be commissioned. In that case, related committees have to report the precautions taken and their results to the Board of
Directors through Audit Committee.
October 31, 2021
November 30, 2021
December 31, 2021
October 31, 2020
November 30, 2020
December 31, 2020
TL+FC
TL+FC
Current Period
160,65
155,09
154,99
Prior Period
156,66
172,64
199,25
FC
FC
457,48
467,81
487,23
434,83
468,88
507,82
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358 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 359
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
The Bank’s Foreign Currency (FC) and total (TL+FC) liquidity coverage ratio (LCR) averaged for the last three months are given below.
Liquidity Coverage Ratio:
Current Period
High Quality Liquid Assets
High Quality Liquid Assets
Cash Outflows
Total Unweighted Value (1)
Dikkate Alınma Oranı
Uygulanmış Toplam Değer (1)
TL+FC
FC
TL+FC
FC
308,711,858
204,903,813
Retail and Small Business Customers, of which;
611,317,338
377,077,839
56,151,478
37,707,784
Stable deposits
Less stable deposits
99,605,132
4,980,257
511,712,206
377,077,839
51,171,221
37,707,784
Unsecured wholesale funding, of which;
334,798,824
187,403,972
168,815,630
98,329,464
Operational deposits
Non-operational deposits
Other unsecured funding
Secured funding
Other cash outflows, of which;
Derivatives cash outflow and liquidity needs related to market valuation
changes on derivatives or other transactions
Obligations related to structured financial products
Commitments related to debts to financial markets and other off-
balance sheet obligations
Other revocable off-balance sheet commitments and contractual
obligations
3,005,540
36,219
739,822
9,055
227,527,733
151,835,763
100,701,866
66,519,903
104,265,551
35,531,990
67,373,942
31,800,506
8,511,344
19,369,975
8,511,344
19,369,975
3,273,748
14,132,379
3,273,748
14,132,379
5,237,596
5,237,596
5,237,596
5,237,596
80,267,478
73,076,139
4,013,374
3,653,807
Other irrevocable or conditionally revocable off-balance sheet obligations
426,353,159
175,080,021
36,996,071
15,510,864
274,712,653
174,585,625
Total Cash Outflows
Cash Inflows
Secured lending
Unsecured lending
Other cash inflows
Total Cash Inflows
Total HQLA Stock
Total Net Cash Outflows
Liquidity Coverage Ratio (%)
(1) The simple arithmetic average calculated for the last three months of weekly simple arithmetic average.
224,756
13,731
Obligations related to structured financial products
Prior Period
High Quality Liquid Assets
High Quality Liquid Assets
Cash Outflows
Total Unweighted Value (1)
Dikkate Alınma Oranı
Uygulanmış Toplam Değer (1)
TL+FC
FC
TL+FC
FC
196,731,749
137,922,605
Retail and Small Business Customers, of which;
385,342,542
255,632,298
35,792,010
25,563,230
Stable deposits
Less stable deposits
Unsecured funding, of which;
Operational deposits
Non-operational deposits
Other unsecured funding
Secured funding
Other cash outflows, of which;
Derivatives cash outflow and liquidity needs related to market valuation
changes on derivative or other transactions
54,844,879
2,742,244
330,497,663
255,632,298
33,049,766
25,563,230
187,046,797
112,910,239
95,886,913
56,879,781
1,255,644
16,359
313,911
4,090
134,597,977
98,576,273
60,491,359
43,239,644
51,193,176
14,317,607
35,081,643
13,636,047
8,505,992
12,874,684
8,505,992
12,874,684
65,495
53,327
4,375,826
8,744,518
4,375,826
8,744,518
Commitments related to debts to financial markets and other off-
balance sheet obligations
Other revocable off-balance sheet commitments and contractual
obligations
4,130,166
4,130,166
4,130,166
4,130,166
53,066,816
46,671,687
2,653,341
2,333,584
Other irrevocable or conditionally revocable off-balance sheet obligations
287,990,929
156,050,151
29,290,631
17,577,368
Total Cash Outflows
Cash Inflows
Secured lending
Unsecured lending
Other cash inflows
Total Cash Inflows
172,194,382
115,281,974
112,194
36,588
1,571
1,356
63,377,888
46,531,386
52,758,960
40,975,721
7,972,830
61,206,589
7,972,830
61,206,589
71,462,912
107,774,563
60,733,361
102,183,666
Upper Limit Applied Values
196,731,749
137,922,605
111,461,021
29,261,943
176,18
470,51
4,195,089
500,968
100,584,121
65,700,311
74,655,489
54,622,443
2,727,740
116,821,011
2,727,740
116,821,011
Total HQLA Stock
Total Net Cash Outflows
Liquidity Coverage Ratio (%)
107,506,950
182,521,322
77,884,197
171,443,454
(1) The simple arithmetic average calculated for the last three months of the monthly simple arithmetic average.
Upper Limit Applied Values
308,711,858
204,903,813
196,828,456
43,646,406
156,91
470,84
Compared to the prior priof, it is observed that the liquidity coverage ratio decreased in the fourth quarter of 2022 due to the increase in net cash
outflows both in total and in foreign currency. Foreign currency liquidity coverage rate decreased due to the increase in net cash outflows, while the total
liquidity coverage rate increased due to the increase in the stock of high-quality liquid assets. Total and Foreign Currency liquidity coverage ratios are
continuing to hover far above the minimum level (respectively 100% and 80%) pursuant to legal legislations.
The Liquidity Coverage Ratio which has been introduced to ensure banks to preserve sufficient stock of high-quality assets to meet their net cash
outflows that may occur in the short term is calculated as per the Communiqué on “Measurement and Assessment of the Liquidity Coverage Ratio of
Banks’ published by BRSA. The ratio is directly affected by the level of unencumbered high-quality assets which can be liquidated at any time and net
cash inflows and outflows arising from the Group’s assets, liabilities and off-balance sheet transactions.
The Group’s high quality liquid asset stock primarily consists of cash and the accounts held at CBRT and unencumbered government bonds which are
issued by Turkish Treasury.
The Bank’s principal source of funding is deposits. In term of non-deposit borrowing, funds received from repurchase agreements, marketable securities
issued, and funds borrowed from financial institutions are among the most significant funding sources.
In order to manage liquidity effectively, concentration of liquidity sources and usages should be avoided. Due to the strong and stable core deposit base
of the Bank, deposits are received from a diversified customer portfolio. In addition, to provide diversification in liquidity sources and usages, liquidity
concentration limits are used effectively. Total amount of funds borrowed from a single counterparty, or a risk group is closely and instantaneously
monitored, taking liquidity concentration limits into account. In addition to these, the cumulative liquidity deficits that the Parent Bank is exposed to in
various maturity tranches are periodically monitored and reported to the senior management.
Cash flows of derivatives that will take place within 30 days are taken into account in calculation of liquidity coverage ratio. Cash outflows of derivatives
that arise from margin obligations, are reflected to the results in accordance with the methodology articulated in the related legislation.
Liquidity risk of the Bank, its foreign branches and subsidiaries that are to be included in consolidation are managed within the regulatory limits and
in accordance with the Group strategies. For the purposes of effectiveness and sustainability of liquidity management, funding sources of Group
compaiesy and funding diversification opportunities in terms of markets, instruments and tenor are evaluated and liquidity position of the group
companies are monitored continuously by the Parent Bank.
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360 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 361
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Presentation of assets and liabilities according to their remaining maturities:
Current Period
Demand
Up to 1 Month
1-3 Months
3-12 Months
1-5 Years
5 Years and
Over
Unallocated
(1)
Total
In compliance with the “TFRS 7”, the following table indicates the maturities of the Group’s major financial liabilities which are not qualified as derivatives.
The following tables have been prepared by referencing the earliest dates of payments without discounting the liabilities. The interest to be paid to the
related liabilities is included in the following table. Adjustments column shows the items that may cause possible cash flows in the following periods. The
values of the related liabilities registered in balance sheet do not include these amounts.
Loans (3)(4)
31,842,932
133,372,179
108,340,248
298,108,761
247,484,905
66,001,950
27,212,758
912,363,733
(1) Includes bonds that have the nature of issued secondary subordinated loans, which are classified as subordinated loans on the balance sheet.
Assets
Cash (Cash in Vault, Foreign
Currency Cash, Money in Transit,
Cheques Purchased) and
Balances with the Central Bank
of Turkey
79,748,724
122,097,175
Banks
19,346,828
16,670,269
2,766,863
210,855
Financial Assets at Fair Value
through Profit/Loss (2)
Money Market Placements
Financial Assets at Fair Value
Through Other Comprehensive
Income
Financial Assets Measured at
Amortized Cost
Other Assets
Total Assets
Liabilities
Bank Deposits
Other Deposits
Funds Provided from Other
Financial Institutions
Money Market Funds
23,111,597
7,384,835
8,561,711
4,628,881
9,377,593
70,884
5,032,776
685,950
476,616
2,131,604
1,793,833
6,858,790
22,485,163
104,870,290
63,985,897
202,125,577
1,665,017
3,364,926
10,014,167
57,972,059
33,939,992
106,956,161
42,335,176
19,159,690
365,493
177,702
2,576,476
129,200,004
193,814,541
198,516,861
307,175,774
130,943,981
336,102,145
422,281,323
163,998,723
156,412,762
1,715,431,569
1,192,084
4,621,637
2,508,509
2,756,604
228,279
430,511,241
366,804,733
100,178,092
39,499,739
3,450,544
884,470
10,660,466
10,450,266
55,030,579
51,420,421
28,419,867
44,232,857
3,247,827
3,748,081
11,391
Marketable Securities Issued (5)
13,077,343
3,213,348
10,823,154
38,912,080
25,877,380
Miscellaneous Payables
89,840,898
59,261,233
441,273
16,961,168
602,083
9,137,558
182,978
3,741,168
465,992
694,157
319,823
282,022,246
313,317,393
521,985,496
515,619,437
129,337,683
115,782,303
95,182,864
55,501,540
282,022,246
1,715,431,569
Other Liabilities (6)
Total Liabilities
201,845,899
38,994,815
53,135,501
6,195,342
11,307,113
941,328,819
155,981,599
51,240,156
91,903,305
150,353,184
Current Period
Demand
Up to 1
Month
1-3 Months
3-12 Months
1-5 Years
5 Years and
Over
Total
Adjustments
(-)
Balance
Sheet Value
Liabilities
Deposits
Funds Provided
from Other Financial
Institutions
Money Market Funds
Marketable Securities
Issued (Net) (1)
Leasing Liabilities
431,703,325 372,404,269
104,427,790
43,495,850
3,819,539
986,180 956,836,953
4,201,021 952,635,932
10,608,924
11,111,093
60,778,311
62,841,187
35,646,503
180,986,018
25,004,419
155,981,599
44,287,582
3,310,657
3,863,524
11,591
51,473,354
233,198
51,240,156
13,592,407
3,461,102
15,080,451
49,361,501
28,795,298
110,290,759
18,387,454
91,903,305
49,799
116,174
460,864
1,223,794
608,706
2,459,337
816,284
1,643,053
Prior Period
Demand
Up to 1
Month
1-3 Months
3-12 Months
1-5 Years
5 Years and
Over
Total
Adjustments
(-)
Balance
Sheet Value
Liabilities
Deposits
Funds Provided
from Other Financial
Institutions
Money Market Funds
Marketable Securities
Issued (Net) (1)
Leasing Liabilities
291,867,150
257,817,496
38,441,570
25,318,327
4,584,375
1,145,789
619,174,707
1,495,504
617,679,203
5,179,465
10,843,245
48,493,365
46,585,229
23,859,359 134,960,663
6,036,980
128,923,683
46,912,274
2,550,211
4,360,066
26,546
53,849,097
111,244
53,737,853
2,348,478
9,678,950
26,563,296
46,508,859
23,533,539
108,633,122
19,076,533
89,556,589
35,971
82,418
272,940
922,507
506,016
1,819,852
580,138
1,239,714
(1) Includes Tier 2 subordinated bond which is classified on the balance sheet as subordinated loan.
The following table shows the remaining maturities of non-cash loans of the Group.
Liquidity Gap
(323,468,635)
(208,443,663)
1,606,298
220,319,842 327,098,459
108,497,183 (125,609,484)
Current Period
Demand
Up to 1 Month
1-3 Months
3-12 Months
1-5 Years
5 Years and Over
Total
Net Off Balance Sheet Position
(2,790,449)
(3,320,632)
1,584,643
2,846,840
550,941
Derivative Financial Assets
Derivative Financial Liabilities
189,216,660
72,157,698
45,268,853
90,901,222
76,163,585
192,007,109
75,478,330
43,684,210
88,054,382
75,612,644
Non-cash Loans
131,529,790
7,843,265
19,534,617
66,168,088
17,943,149
7,497,012
(1,128,657)
473,708,018
474,836,675
250,515,921
Prior Period
Total Assets
Total Liabilities
Liquidity Gap
169,573,968
174,612,538
78,545,534
188,657,776
319,514,247
108,583,650
84,916,360
1,124,404,073
342,908,302
347,075,584
66,693,216
103,208,681
85,833,703
43,502,176
135,182,411
1,124,404,073
(173,334,334)
(172,463,046)
11,852,318
85,449,095 233,680,544
65,081,474 (50,266,051)
Net Off Balance Sheet Position
Derivative Financial Assets
Derivative Financial Liabilities
1,303,544
2,537,428
314,978
1,850,956
494,422
154,345,598
63,995,026
43,416,267
67,227,055
65,745,376
153,042,054
61,457,598
43,101,289
65,376,099
65,250,954
Non-cash Loans
117,111,116
3,824,077
10,279,933
47,548,648
14,381,524
6,470,495
6,501,328
394,729,322
388,227,994
199,615,793
(1) Assets, such as Tangible Assets, Subsidiaries and Associates, Office Supply Inventory, Prepaid Expenses and Non-Performing Loans, which are required for banking operations and which cannot be converted
into cash in short-term, other liabilities such as Provisions which are not considered as payables and Shareholders’ Equity, are shown in ‘Unallocated” column.
(2) The balances include financial derivative assets.
(3) Includes leasing and factoring receivables.
(4) Stage 3 Non performing loans are included in “Unallocated” column.
(5) Includes Tier 2 subordinated bond which is classified on the balance sheet as subordinated loan.
(6) The borrower funds are presented in “Up to 1 month” column in other liabilities.
Letters of Credit
Letters of Guarantee
Acceptances
Other
Total
21,031,210
109,360,483
137,720
1,000,377
4,990,207
2,525,641
327,417
8,488,974
10,142,096
864,033
39,514
21,584,064
37,774,002
6,723,990
502,220
16,297,174
347
86,032
1,143,408
131,529,790
7,843,265
19,534,617
66,168,088
17,943,149
271,840
56,868,515
4,653,229
180,752,625
2,571,943
7,497,012
8,053,507
4,841,274
250,515,921
Prior Period
Demand
Up to 1 Month
1-3 Months
3-12 Months
1-5 Years
5 Years and Over
Total
Letters of Credit
Letters of Guarantee
Acceptances
Other
Total
39,975,559
75,667,646
583,828
884,083
1,442,386
1,355,867
1,010,984
14,840
1,343,837
6,702,245
2,233,851
4,648,587
32,852,294
9,932,465
115,302
1,266,738
11,984,768
44,745
1,085,273
196,642
4,104,143
2,169,710
48,873,749
132,666,963
13,805,873
4,269,208
117,111,116
3,824,077
10,279,933
47,548,648
14,381,524
6,470,495
199,615,793
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Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
The following table shows the remaining maturities of derivative financial assets and liabilities of the Group.
c. Explanations on consolidated leverage ratio
Current Period
Up to 1 Month
1-3 Months
3-12 Months
1-5 Years
Forwards Contracts- Buy
Forwards Contracts- Sell
Swaps Contracts -Buy
Swaps Contracts -Sell
Futures Transactions-Buy
Futures Transactions-Sell
Options-Call
Options-Put
Other
Total
Forwards Contracts - Buy
Forwards Contracts - Sell
Swaps Contracts - Buy
Swaps Contracts - Sell
Futures Transactions - Buy
Futures Transactions - Sell
Options - Call
Options – Put
Other
Total
5 Years and
Over
Total
34,922,126
34,417,278
8,245,045
8,292,895
11,228,799
10,969,931
12,917,860
12,661,924
2,530,422
2,492,528
152,309,275
44,576,936
19,903,500
87,599,199
72,341,423
376,730,333
169,988,158
55,485,647
19,253,119
84,790,253
71,790,482
401,307,659
130,537
129,888
3,643,935
3,641,727
2,224,899
1,266,177
1,561,858
1,870,756
55,041
50,766
5,545,458
4,879,934
34,842,309
18,451,025
13,685,461
707,612
707,612
127,978
3,822,162
3,822,162
2,410,477
1,446,831
15,281,025
14,922,191
67,106,773
381,223,769
147,636,028
88,953,063
178,955,604
151,776,229
948,544,693
9,789,528
10,177,720
7,650,678
7,694,897
120,101,356
48,549,092
133,617,738
49,670,442
7,696
7,967
5,122,288
5,201,143
23,362,216
922,465
175,595
2,949,375
2,919,767
4,920,313
14,817,597
14,931,354
22,481,946
22,068,513
591,886
595,566
4,012,940
3,962,813
3,054,941
5 Years and
Over
Total
37,054,393
37,402,956
62,720,302
316,039,342
62,225,880
327,933,504
4,796,590
4,598,985
62,186,646
60,350,931
3,025,074
3,025,074
670,002
1,522,047
779,128
15,109,677
15,108,797
32,007,472
307,387,652
125,452,624
86,517,556
132,603,154
130,996,330
782,957,316
Prior Period
Up to 1 Month
1-3 Months
3-12 Months
1-5 Years
VII.
Explanations on Leverage Ratio
a. Explanations on Differences Between Current and Prior Years’ Leverage Ratios
The Bank’s consolidated leverage ratio is calculated in accordance with the principles of the “Regulation on Measurement and Evaluation of
Banks’ Leverage Level”. The Bank’s consolidated Leverage ratio is 8.14% (December 31, 2021: 6.12%). According to Regulation the minimum
leverage ratio is 3%. The changes in the leverage ratio are mostly due to the increase in the Tier I Capital amounts.
b. Summary Comparison Table Related to Total Amount of Asset and Risk Situated in The Consolidated Financial Statements Prepared in
Accordance with TAS:
Summary Comparison Table Related to Total Amount of Asset and Risk Situated in The
Consolidated Financial Statements Prepared in Accordance with TAS
The difference between Total Amount of Asset in the Consolidated Financial Statements
Prepared in Accordance with TAS and the Communiqué on Preparation of Consolidated
Financial Statements of Banks
The difference between total amount and total risk amount of derivative financial
instruments with credit derivative in the Communiqué on Preparation of Consolidated
Financial Statements of Banks (2)
The difference between total amount and total risk amount of risk investment securities
or commodity collateral financing transactions in the Communiqué on Preparation of
Consolidated Financial Statements of Banks (2)
The difference between total amount and total risk amount of off-balance sheet
transactions in the Communiqué on Preparation of Consolidated Financial Statements of
Banks (2)
The other differences between amount of assets and risk in the Communiqué on
Preparation of Consolidated Financial Statements of Banks (2)
Total Exposures (2)
Current Period
Prior Period
1,411,809,015 (1)
1,138,221,128
28,842,201 (1)
13,817,055
(7,562,976)
(4,521,050)
39,516,082
41,010,346
21,574,281
19,341,737
(1,672,308)
7,102,851
2,134,786,443
1,376,092,005
(1) As the consolidated financial statements dated 31.12.2022 prepared per paragraph 6 of article 5 of the "Communiqué on the Preparation of Consolidated Financial
Statements of Banks" have not yet been published as of the report date pursuant the legal regulations, the consolidated financial statement balances of 30.06.2022 are included.
(2) The amounts in the table represents the average of three months.
On-Balance Sheet Items
On-balance sheet items (excluding derivatives and SFTs. but including collateral)
1,639,991,435
1,025,401,026
Current Period (1)
Prior Period (1)
Asset amounts deducted in determining Basel III Tier 1 capital
The total amount of risk on-balance sheet exposures
Derivative exposures and credit derivatives
(3,634,115)
(1,968,196)
1,636,357,320
1,023,432,830
Replacement cost associated with derivative financial instruments and credit derivatives
The potential amount of credit risk with derivative financial instruments and credit derivatives
The total amount of risk on derivative financial instruments with credit derivatives
18,799,552
7,562,976
26,362,528
23,322,566
4,521,050
27,843,616
Investment securities or commodity collateral financing transactions
The amount of risk investment securities or commodity collateral financing transactions
(Excluding on balance sheet items)
Risk amount of exchange brokerage operations
14,350,224
5,751,181
The total amount of risk investment securities or commodity collateral financial transactions
14,350,224
5,751,181
Off -Balance Sheet Items
Gross notional amount for off-balance sheet items
Adjustments for conversion to credit equivalent amounts
The total amount of risk for off-balance sheet items
Capital and Total Exposures
Tier 1 Capital
Total Exposures
Leverage Ratio
Leverage Ratio
(1) Three-month average of the amounts in Leverage Ratio table.
VIII.
Explanations on Other Price Risk
477,654,908
(19,938,537)
457,716,371
337,285,014
(18,220,636)
319,064,378
174,084,953
83,746,667
2,134,786,443
1,376,092,005
8.14
6.12
The Group is exposed to stock price risk due to its investments in companies being traded on the BIST.
The Group's sensitivity to stock price risk at the reporting date was measured with an analysis. In the analysis, with the assumption of all other variables
were held constant and the data (stock prices) used in the valuation method are 10 % higher or lower. According to this assumption in shares traded in
Borsa Istanbul and followed under Financial Assets at Fair Value through Profit or Loss account, expected to have an effect amounting to TL 1,187,352
increase/decrease.
1.
1.
Explanations on Presentation of Assets and Liabilities at Fair Value
Information on fair values of financial assets and liabilities
Financial Assets
Money Market Placements
Banks
Financial Assets at Fair Value Through Other Comprehensive
Income
Financial Assets Measured at Amortized Cost
Loans (1)
Financial Liabilities
Banks Deposits
Other Deposits
Funds Provided from Other Financial Institutions
Marketable Securities Issued (2)
Miscellaneous Payables and funds borrowed
Book Value
Fair Value
Current Period
Prior Period
Current Period
Prior Period
6,195,342
38,994,815
2,993,064
35,195,242
6,195,342
39,037,629
2,993,064
35,181,094
202,125,577
109,943,659
202,125,577
109,943,659
106,956,161
885,150,975
11,307,113
941,328,819
155,981,599
91,903,305
151,090,917
51,545,328
127,548,531
50,990,529
590,297,628
871,796,926
569,711,027
6,427,034
10,949,385
6,185,928
611,252,169
941,495,895
610,797,007
128,923,683
152,058,375
123,962,706
89,556,589
77,025,465
89,153,363
151,090,917
85,380,759
77,025,465
(1) Factoring and Leasing Receivables are included.
(2) Includes Tier 2 subordinated bond which is classified on the balance sheet as subordinated loan.
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Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Strike prices, quotations, market prices determined by the CBRT and published in the Official Gazette and the values calculated by using alternative
models, are taken as the basis in the fair value determination of financial assets at fair value through other comprehensive income.
Properties that are recorded under tangible assets at fair value by the Bank and consolidated companies are classified in the 3rd level, whereas
investment properties are clasiffied both in the 2nd and 3rd level.
When the prices of the financial assets measured at amortized cost cannot be measured in an active market, fair values are not deemed to be reliably
determined and amortized cost, calculated by the internal rate of return method, are taken into account as the fair values.
Fair values of banks, loans granted, deposits and funds borrowed from other financial institutions are calculated by discounting the amounts in each
maturity bracket formed according to repricing periods, using the rate corresponding to relevant maturity bracket in the discount curves based on current
market conditions.
2.
Information on fair value measurements recognized in the financial statements
TFRS 13 – “Fair Value Measurement” standard requires the items, which are recognized in the balance sheet at their fair values to be shown in the notes
by being classified within a range. According to this, the related financial instruments are classified into three levels in such a way that they will express
the significance of the data used in fair value measurements. At the first level, there are financial instruments, whose fair values are determined according
to quoted prices in active markets for identical assets or liabilities, at the second level, there are financial instruments, whose fair values are determined
by directly or indirectly observable market data, and at the third level, there are financial instruments, whose fair values are determined by the data, which
are not based on observable market data. The financial assets, which are recognized in the balance sheet at their values, are shown below as classified
according to the aforementioned principles of ranking.
Current Period
Level 1
Level 2
Level 3
Financial Assets at Fair Value Through Profit and Loss
Debt Securities
Equity Securities
Derivative Financial Assets at Fair Value through Profit and Loss
Other
Financial Assets at Fair Value Through Other Comprehensive
Income(1)
Debt Securities
Equity Securities
Other
Derivative Financial Liabilities
4,574,363
11,874,735
5,124,774
74,381,684
47,760
531,003
5,807,344
333,165
19,560,649
5,770,724
121,851,511
1,416,134
10,091,101
89,747
3,760,778
(1) Since they are not traded in an active market, the equity securities (TL 136,707) under the financial assets at fair value through other comprehensive income are shown in the
financial statements at acquisition cost and the related securities are not shown in this table.
Prior Period
Level 1
Level 2
Level 3
Financial Assets at Fair Value Through Profit and Loss
Debt Securities
Equity Securities
Derivative Financial Assets Held for Trading
Other
Financial Assets Available-for-Sale(1)
Debt Securities
Equity Securities
Other
Derivative Financial Liabilities
710,080
2,368,275
700,327
6,028,045
458,185
24,750,427
2,066,313
2,149,813
65,501,109
41,450,375
1,789,775
140,975
243,653
745,821
24,966
14,078,527
(1)Since they are not traded in an active market, the equity securities (TL 46,985) under the financial assets available-for-sale are shown in the financial statements at acquisition
cost and the related securities are not shown in this table.
X.
X. Explanations on Transactions Carried Out on Behalf of Third Parties and Fiduciary Transactions
The Group gives trading, custody, fund management services in the name and on the account of its customers. The Group has no fiduciary transactions.
X.
XI. Explanations on Risk Management Objectives and Policies
The explanations prepared in accordance with the “Communiqué on Public Disclosures on Risk Management by Banks” published in the Official Gazette
dated 23.10.2015 and numbered 29511 are as follows; Standard Approach is used by the Bank in calculating capital adequacy and other explanations
within the scope of IRB (Based on Internal Rating) approach are not included.
a. General Information on Risk Management and Risk Weighted Amounts
a.1 Risk Management Approach of the Group
The Group is exposed to financial and non-financial risks which are required to be analyzed, monitored and reported within specific risk management
principles and with the perspective of Group risk management. The risk management process is organized within the framework of risk management
and serves the creation of a common risk culture in corporate level; which brings “corporate governance” to forefront, the independence of the internal
audit and monitoring units from the business units that undertake risks is established risk is defined in accordance with international regulations and in
this context measurement, analysis, monitoring, reporting and control functions are carried.
Risk management process and the functions involved in the process is one of the primary responsibilities of the Board of Directors. The Risk Committee
operates to prepare the Group's risk management strategies and policies, submit them to the Board of Directors for approval and monitor the
implementations. Evaluating the capital adequacy and observing the active use of results in planning and decision-making processes, establishing and
monitoring limits related to main risks, monitoring the activities of risk management (determining, defining, measuring, evaluating and managing risk) and
monitoring results and methods in measuring risk are also under their authority and responsibility of the Committee. Committee reports activity results to
the Board of Directors through Audit Committee.
The Operational Risk Committee operates to determine strategies and policies for managing operational risks that the Bank may be exposed to, to
develop an operational risk management framework and to strengthen the governance model for operational risks. The Committee reports the results of
the activity to the Board of Directors through the Audit Committee.
The Risk Management Department, which reports to the Board of Directors of the Parent Bank through the Internal Systems Manager; organized as
Asset-Liability Management Unit, Credit Risk Management Unit, Credit Risk Analytics and Control Unit, Operational Risk and Affiliate Risk Unit, Model
Risk and Validation Unit, Internal Capital Assessment Process and Economic Capital Unit.
The Group’s risk management process is carried out within the framework of risk policies which are issued by the Board of the Directors by taking the
recommendations of the Risk Management Department into account and which include the written standards that are implemented by the business
units. These policies which are entered into force in line with the international practices are general standards which contain organization and scope
of the risk management function, risk measurement policies, duties and responsibilities of the risk management group, procedures for determining risk
limits, ways to eliminate limit violations, compulsory approvals and confirmations to be given in a variety of events and situations.
In the aforementioned risk policies, the Group’s risk appetite framework is defined as a set of approaches that determine the risk capacity, the risk
appetite, the risk tolerance and that include the policies, procedures, controls and systems for reporting and monitoring of the limits set for the Group’s
risk profile and the indicators in the framework. The Group's risk appetite framework, which is formed in accordance with the above-mentioned factors
and entered into force with the Board of Directors approval, includes indicators that are aligned with the business plan, the strategic programme,
capital and remuneration planning and comparable on a business unit level to the extent possible. The compliance to the limits within the framework is
periodically monitored and the realization of the risk appetite indicators are reported to the Risk Committee and the Boards on a monthly basis.
In order to build a strong corporate culture that has a risk management perspective, the Group has policies, processes, systems and a control system
that is integrated with the risk management system. All employees of the Group essentially perform their duties in a responsible manner that aims to
develop controls to reduce or eliminate the probability of the Group to incur losses related to the operational risks. In the process risk analysis studies,
risks and the related controls are evaluated together with employees performing the relevant process in a holistic approach. Procedures to be followed
in case of a risk threshold breach and risk definitions are given in the risk politics. Code of conducts, operation manuals, the sharing of duties between
business units and risk units are announced to staff.
The risk reports that analyse the results reached by the Parent Bank and the comprehensive risk assessment and comparison of these results with a risk
management perspective are periodically submitted to the Risk Committee and to the Board through the Audit Committee. The content of the above-
mentioned reports could be summarised as follows:
ੵ Capital adequacy ratio, the progression of the components of this ratio and the issues that affect the aforementioned ratio,
ੵ Monitoring the compliance status of the limits set by the Board of Directors as a part of therisk appetite framework and based on the components of
The movement table of financial assets at level 3 is given below:
the main risk types,
Balance at the Beginning of the Period
Purchases
Redemption or Sales (1)
Valuation Difference
Transfers
Balance at the end of the Period
Current Period
Prior Period
3,939,588
1,922,461
(2,785,690)
673,556
100,610
3,850,525
3,015,526
1,018,018
(300,848)
307,502
(100,610)
3,939,588
(1) As the details are given in the Fifth Section Note I-b.3, between the company and the TVF for the sale of all A group registered shares corresponding to 55% of the capital
of the company owned by the special purpose company to the Turkish Wealth Fund (TVF). A share transfer agreement was signed, and the sale and transfer transaction were
realized on 31.03.2022.
ੵ In addition to the assesment of the loan portfolio on the basis of counterparties and loan types, monitoring of the portfolio as a whole according to
parameters such as maturity, sector, geography, risk ratings, arrears, defaults,
ੵ Measuring the assets and liabilities management risk, and reporting of measurement results,
ੵ Monitoring all risks assessed within the scope of non-financial risks, including operational risk, reputational risk and climate change risk, and
operational risk qualified loss events and risk indicators occurring at the Bank,
ੵ Testing measurement results for their integrity and reliability,
ੵ Analysing the level of risk indicators under various stress scenarios,
ੵ Examining various concentration indicators and the course followed by these indicators.
In addition, analyzes and evaluations regarding the risk level of the companies included in the consolidated risk policies are also included in the
mentioned report..
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Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
As per the communique on “Bank’s Internal Systems and Internal Capital Adequacy and Assessment Process” and “Guidelines for Stress Testing
of Banks to Use in Capital and Liquidity Planning”, stress tests are conducted for the entire risks that the Group is exposed to and on the basis of
significant risk categories. As a part of the holistic stress tests, risk appetite, capital planning, strategic plan and budget, action plans for emergencies and
unexpected situations related to miscellaneous risks and other issues considered as significant are taken into consideration. In the above-mentioned
stress tests, the methods that form the basis of regulatory reporting (standard method for credit and market risk, basic indicator method for operational
risk) are used. On the other hand, in the stres tests for individual risk types the most advanced approaches used for risk measurement in the Parent Bank
are leveraged.
In the stress tests, both the first pillar risks (credit risk, market risk, operational risk) in scope of the regulatory framework and all the other risks that
the Group is exposed to independent of the regulatory framework are taken into account in a holistic perspective. In determining the course of capital
adequacy under various scenarios during the planning horizon, the actions that the Group will take in case of stress conditions and the impact of the
diversified growth strategies of business units on the capital adequacy and the balance sheet are considered.
The scope and content of the Parent Bank's risk management system in terms of the main risk types are listed below. Risk mitigation strategies and
processes for the assessment of their effectiveness are given in Fourth Section II No. "Explanations on Credit Risk" under the Fourth Chapter XI-c.2
notes. No. "The Public Disclosure of Qualitative Information Related to the Market Risk " mentioned in the section.
Credit Risk
Credit risk is defined as the risk of the failure to comply with the requirements or failing to fulfill its obligations partially or totally of the counter side of
the transaction contract with the Parent Bank. The methodology and responsibilities of the credit risk management, controlling and monitoring and the
framework of credit risk limitations specified with the credit risk policy.
The Bank defines measures and manages credit risk of the all products and activities. Board of Directors review the Parent Bank’s credit risk policies and
credit risk strategy on an annual basis as a minimum. Key Management is responsible for the implementation of credit risk policies which are approved
by Board of Directors.
As a result of loans and credit risks analysis all findings are reported to Board of Directors and Key Management on a regular basis. In addition to
transaction and company based credit risk assessment process, monitoring of credit risk also refers to an approach with monitoring and managing the
credit as a whole maturity, sector, security, geography, currency, credit type and credit rating.
In the Parent Bank’s credit risk management, along the limits as required by legal regulations, the Parent Bank utilizes the risk limits to undertake the
maximum credit risk within risk groups or sectors that the Board of Directors determines. These limits are determined such a way that prevents risk
concentration on particular sectors. Excess risk limits up to legal requirements and boundaries limits are considered as an exception. The Board of
Directors has the authority in exception process. The results of the control of risk limits and the evaluations of these limits are presented by Internal Audit
and Risk Management Group to Key Management and Board of Directors.
The Bank uses credit decision support systems which are created for the purpose of credit risk management, lending decisions, controlling the credit
process and credit provisioning. The consistency of the credit decision support systems with the structure of the Parent Bank’s activities, size and
complexity is examined continuously by internal systems. Credit decision support systems contain the Risk Committee assessment and approval of
Board of Directors.
Asset and Liability Management Risk
Asset-liability management risk defined as the risk of Group’s incurring loss due to managing all financial risks that are inflicted from the assets, liabilities
and off-balance sheet transactions, ineffectively. Trading book portfolio’s market risk, structural interest rate risk and liquidity risk of the banking portfolio;
are considered within the scope of the asset liability management.
Complying the established risk limits and being at the limits that stipulated by the legislation are the primary priority of Asset-liability management risk.
Risk limits are determined by the Board of Directors by taking into consideration of the Group's liquidity, target income level and general expectations
about changes in risk factors
Board of Directors and the Audit Committee are responsible for following the Group's capital is used optimally; for this purpose, checking the status
against risk limits and providing the necessary actions are taken.
Asset and Liability Management Committee is responsible for managing the Asset and Liability risk within the framework of operating principles that are
involved in the risk appetite and risk limits are set by the Board of Directors in accordance with the policy statement.
Asset and liability management processes and compliance with the provisions of the policy are controlled and audited by the internal audit system. The
execution of the audit, reporting the audit results, action plans for the elimination of errors and gaps identified as a result of inspections regarding the
fulfillment of the principles, are determined by the Board of Directors.
Operational Risk
Operational risk is defined as “insufficient or unsuccessful internal processes, people and systems, or external events resulting from and legal it is
defined as ”the possibility of causing harm", which also includes the risk that may arise. Studies consisted and are formed of occur by execution of
identification, definition, measurement, analysis, monitoring of operational risk, providing and reporting the necessary control related to monitoring the
progress of our country and the world, the development of techniques and methods, necessary legal reporting, notification and conduct of follow-up
transactions. Studies on the subject are conducted by the Department of Risk Management.
Operational risks that arise due to the activities are defined in "Bank Risk Catalogue" and classified in respect of species. Bank Risk Catalogue is kind of
the fundamental document that used for identification and classification of all at the risk that may be encountered. It is updated in line with the changes
in the nature of the processes and activities.
Qualitative and quantitative methods are used in a combination for measurement and evaluation of the operational risks. In this process, information use
that obtained from "Impact-Probability Analysis", "Missing Event Data Analysis", "Risk Indicators", “Scenario Analysis”, “Top-Down Risk Assessment”,
“Internal Model” methods. Methods prescribed by legal regulations are applied as minimum in determining the capital requirement level for the operating
risk.
Operational Risk Committee that established by a decision of the board of directors on 30.04.2020, the management of operational risks that the bank
may be exposed for the determination of policies and strategies, the development of an operational risk management framework and operational risks
include activities with the aim of strengthening the governance model. The Committee works in cooperation with the Risk Committee and reports the
results of its activities to the Board of Directors through the Audit Committee.
All risks are assessed in the context of operational risk, loss events and the risk indicators same as operational risks that occurred in the Parent Bank, are
monitored on a regular basis by the Department of Risk Management and reported periodically to the Risk Committee, Operational Risk Committee and
the Board of Directors.
Model Risk Management and Validation Operations
Model risk is the risk of financial losses and / or loss of reputation that the Bank may be exposed to due to errors and / or malfunctions that occur during
the creation, implementation or use of models used in its activities. In order to address the model risk in a holistic manner, the model definition, model
life cycle and triple line of defense structure and the duties and responsibilities of all functions of the Bank in this structure are defined in the model risk
management policy.
Model risk management and validation activities in the second line of defense of the triple line of defense structure; creating the model inventory,
determining and approving the model class, validating the models, preparing periodic reports on the Bank's model risk and reporting to the Risk
Committee, Audit Committee. and submission to the Board of Directors.
Risk measurement models are validated at least once a year under international standardsWithin the scope of validation, activities are carried out to
test the performance and validity of models with statistical methods, to examine the quality of the data used in the model development phase and
the conceptual soundness of the selected methods, and to evaluate the health of the processes created for the use of the models.The results of the
validation activities are reported to the Risk Committee and the Board of Directors.
Subsidiaries Risk Operations
Corporations within the Bank’s consolidated risk policy, in terms of their own business lines, measure, evaluate and monitor risks, establish risk limits. Risk
limits are approved by their own Board of Directors. Risk levels are reported to the Bank’s Risk Committee within the periods set by the Bank, to monitor
risk levels on consolidated basis. The Bank’s Risk Committee, assesses the risk levels and report the results to the Board of the Directors of the Bank.
a2. General Information on Risk Weighted Amounts
Risk Weighted Amount (1)
Minimum Capital Requirements
Current Period
Prior Period
Current Period
Credit risk (excluding counterparty credit risk) (CCR)
953,524,113
578,238,623
Of which standardised approach (SA)
953,524,113
578,238,623
Of which internal rating-based (IRB) approach
Counterparty credit risk
Of which standardised approach for counterparty credit risk
(CCR)
Of which internal model method (IMM)
Equity positions in banking book under basic risk weighting or
internal rating-based approach
16,407,066
17,096,324
16,407,066
17,096,324
Equity investments in funds – look-through approach
9,051,377
2,683,178
Equity investments in funds – mandate-based approach
Equity investments in funds - 1250% weighted risk approach
Settlement risk
21,438
Securitization positions in banking accounts
Of which IRB ratings-based approach (RBA)
Of which IRB Supervisory formula approach (SFA)
Of which SA/simplified supervisory formula approach (SSFA)
Market risk
Of which standardised approach (SA)
Of which internal model approaches (IMM)
Operational Risk
Of which Basic Indicator Approach
Of which Standardised approach (SA)
Of which Advanced measurement approach
42,220,363
42,220,363
22,674,325
22,674,325
65,807,811
65,807,811
51,469,094
51,469,094
76,281,929
76,281,929
1,312,565
1,312,565
724,110
1,715
3,377,629
3,377,629
5,264,625
5,264,625
The amounts below the thresholds for deduction from capital
(subject to a 250% risk weight)
963,063
700,490
77,045
Floor adjustment
Total
1,087,995,231
672,862,034
87,039,618
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Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
b. Linkages Between Financial Statements and Risk Amounts
b.1 Differences and linkage between scopes of accounting consolidation and regulated consolidation
Differences and Linkage Between Accounting Consolidation and Legal Consolidation Scope:
Current Period
Carrying
values in
financial
statements
prepared as
per TAS (1)
Carrying
values in
consolidated
financial
statements
prepared as
per TAS (2)
Carrying values of items in accordance with Turkish Accounting Standards (TAS) (2)
Subject to
credit risk
Subject to
counterparty
credit risk
Securitization
Positions
Subject to
market risk
Not subject
to capital
requirements
or subject to
deduction from
capital
17,047,993
4,677,273
11,111,264
138,681
3,767,296
Assets
Cash and CBRT
201,811,531
201,845,899
201,845,899
Banks and Money Market Placements
45,665,900
45,190,157
45,190,157
Financial Assets at Fair Value Through Profit/Loss
18,841,483
33,574,852
16,526,859
Financial Assets at Fair Value Through Other
Comprehensive Income
Derivative Financial Assets at Fair Value Through
Profit/Loss
Derivative Financial Assets at Fair Value Through
Other Comprehensive Income
Financial Assets at Measured at Amortised Cost –
Loans (3)
Financial Assets at Measured at Amortised Cost –
Other Financial Assets
Financial Assets at Measured at Amortised Cost –
Expected Credit Loss (-)
150,681,869
202,125,577
202,125,577
19,740,263
19,560,649
19,560,649
19,560,649
1,982,488
758,003,869
912,363,733
912,363,733
71,733,585
106,956,161
106,956,161
34,916,253
39,990,816
39,990,816
Assets Held for Sale and Discontinued Operations
1,589,482
1,618,994
1,618,994
Investment in Associates, Subsidiaries and Joint-
Ventures
Tangible Assets
Intangible Assets
Investment Properties
Current Tax Asset
Deferred Tax Asset
Other Assets
Total Assets
Liabilities
Deposits
Funds Borrowed
Money Market Funds
Marketable Securities Issued
Derivative Financial Liabilities at Fair Value Through
Profit/Loss
Derivative Financial Liabilities at Fair Value Through
Other Comprehensive Income
Leasing Liability
Provisions
Current Tax Liability
Deferred Tax Liability
Subortinated Debts
Other Liabilities
Shareholders' Equity
Total Liabilities
2,466,588
42,870,444
42,870,444
50,755,101
24,478,118
21,263,195
6,081,880
3,763,045
3,470,339
4,079,813
11,320,190
26,354
974,110
24,478,118
4,079,813
11,320,190
26,354
974,110
88,874,650
148,437,334
148,437,334
1,411,809,015 1,715,431,569 1,698,383,576
19,560,649
32,836,530
3,905,977
751,961,017
952,635,932
165,658,441
155,981,599
55,086,429
51,240,156
63,967,809
58,344,560
12,144,239
10,091,101
203,900
2,730,945
1,643,053
56,005,657
67,292,475
4,461,088
493,636
8,125,987
1,599,383
46,801,726
33,558,745
78,658,138
164,865,885
173,635,990
210,052,693
1,411,809,015 1,715,431,569
9,549,591
41,795,275
10,091,101
51,344,866
10,091,101
(1) June 30, 2022, amounts are represented, as consolidated financial statements dated December 31, 2022, prepared in accordance with Article No 5 of Clause No 6 in the Communiqué on Preparation of
Consolidated Financial Statements of Banks are not published as of reporting date.
(2) Leasing and Factoring Receivables are included.
Prior Period
Carrying
values in
financial
statements
prepared as
per TAS
Carrying
values in
consolidated
financial
statements
prepared as
per TAS
Carrying values of items in accordance with Turkish Accounting Standards (TAS) (2)
Subject to
credit risk
Subject to
counterparty
credit risk
Securitization
Positions
Subject to
market risk
Not subject
to capital
requirements
or subject to
deduction from
capital
4,776,317
1,474,079
11,111,264
89,996
1,993,519
Assets
Cash and CBRT
183,647,187
184,021,225
184,021,225
Banks and Money Market Placements
41,011,671
38,188,306
38,188,306
Financial Assets at Fair Value Through Profit/Loss
12,515,537
14,481,038
9,704,721
Financial Assets at Fair Value Through Other
Comprehensive Income
Derivative Financial Assets at Fair Value Through
Profit/Loss
Derivative Financial Assets at Fair Value Through
Other Comprehensive Income
Financial Assets at Measured at Amortised Cost –
Loans (1)
Financial Assets at Measured at Amortised Cost –
Other Financial Assets
Financial Assets at Measured at Amortised Cost –
Expected Credit Loss (-)
110,065,911
109,943,659
109,943,659
24,925,472
24,750,427
24,750,427
24,750,427
899,645
612,758,151
614,742,720
614,742,720
55,051,217
51,545,328
51,545,328
32,875,072
32,854,286
32,854,286
Assets Held for Sale and Discontinued Operations
910,871
910,871
910,871
Investment in Associates, Subsidiaries and Joint-
Ventures
Tangible Assets
Intangible Assets
Investment Properties
Current Tax Asset
Deferred Tax Asset
Other Assets
Total Assets
Liabilities
Deposits
Funds Borrowed
Money Market Funds
Marketable Securities Issued
Derivative Financial Liabilities at Fair Value Through
Profit/Loss
Derivative Financial Liabilities at Fair Value Through
Other Comprehensive Income
Leasing Liability
Provisions
Current Tax Liability
Deferred Tax Liability
Subortinated Debts
Other Liabilities
Shareholders' Equity
Total Liabilities
(1) Leasing and Factoring Receivables are included.
1,985,263
21,918,409
21,918,409
43,214,686
11,407,024
11,407,024
17,266,481
6,070,732
152,861
2,182,025
4,601,916
74,819
2,182,025
4,601,916
74,819
4,312,073
3,118,976
3,118,976
56,308,442
75,371,616
75,371,616
1,138,221,128 1,124,404,073
1,119,627,756
24,750,427
17,361,660
2,083,515
607,250,936
617,679,203
143,646,510
128,923,683
53,737,853
53,737,853
57,083,581
48,077,312
14,098,639
14,078,527
51,639
2,137,509
1,239,714
41,787,985
35,609,317
4,104,365
757,656
2,561,136
124,949
41,474,082
41,479,277
47,118,391
84,724,923
124,971,982
96,168,179
1,138,221,128
1,124,404,073
53,235,157
14,078,527
53,235,157
14,078,527
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Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
b2. The main sources of the differences between the risk amounts and the amounts assessed in accordance with TAS in the financial statements
Current Period
Total
Credit Risk
Asset carrying value amount under scope of TAS
1,715,431,569
1,698,383,576
Securitization
Position
Counterparty
credit risk
Market risk
19,560,649
32,836,530
(51,344,866)
10,091,101
1,715,431,569
1,698,383,576
70,905,515
22,745,429
Off-balance sheet amounts
998,385,339
170,131,232
26,399,369
13,503,864
Liabilities carrying value amount under scope of TAS
Total net amount under regulatory scope of
consolidation
Repurchase Transactions Valuation Adjustments (1)
Differences in valuations
Differences due to different netting rules
Differences due to consideration of provisions
Differences due to prudential filters
Differences due to risk mitigation (2)
Risk Amounts
(212,108,632)
(37,580,583)
1,618,825,593
39,903,233 22,745,429
(1) According to the "Regulation on Measurement and Evaluation of Capital Adequacy of Banks", it is the counterparty credit risk amount calculated for repo style transactions.
(2) The source of the difference is the collateral for receivables under credit risk mitigation in the calculation of capital adequacy.
1,124,404,073
1,119,627,756
77,985,584
3,283,133
Securitization
Position
Counterparty
credit risk
Market risk
24,750,427
17,361,660
(53,235,157)
14,078,527
29,890,333
6,394,736
Priot Period
Total
Credit Risk
Asset carrying value amount under scope of TAS
1,124,404,073
1,119,627,756
Liabilities carrying value amount under scope of TAS
Total net amount under regulatory scope of
consolidation
Off-balance sheet amounts
771,887,904
147,301,592
Repurchase Transactions Valuation Adjustments (1)
Differences in valuations
Differences due to different netting rules
Differences due to consideration of provisions
Differences due to prudential filters
Differences due to risk mitigation (2)
Risk Amounts
(177,234,524)
(65,728,440)
1,023,966,384
1
2
3
4
5
6
7
8
9
10
11
1
2
3
4
5
6
7
8
9
10
11
Current Period
Loans (1)
Debt Securities
Off-balance sheet
exposures
Total
Current Period
Loans (1)
Debt Securities
Off-balance sheet
exposures
Total
Gross carrying value in financial statements prepared
in accordance with Turkish Accounting Standards
(TAS)
Defaulted
Non-defaulted
Allowances/ Amortization
and Impairments
Net Values
27,212,758
885,150,975
301,641,082
20,565,590
891,798,143
301,641,082
1,998,636
465,938,988
1,618,580
466,319,044
29,211,394
1,652,731,045
22,184,170
1,659,758,269
Gross carrying value in financial statements prepared
in accordance with Turkish Accounting Standards
(TAS)
Defaulted
Non-defaulted
Allowances/ Amortization
and Impairments
Net Values
24,445,092
1,613,512
590,297,628
153,871,817
333,971,906
15,898,604
598,844,116
153,871,817
1,215,814
334,369,604
26,058,604
1,078,141,351
17,114,418
1,087,085,537
(1) Credit balance which is monitored as Financial Assets at Fair Value Through Profit or Loss is not included in the above table. It is shown in detail in Section 5 footnote 1.b.3.
c.1.3. Changes in Stock of Default Loans and Debt Securities (1)
Defaulted loans and debt securities at end of the previous reporting period
Loans and debt securities that have defaulted since the last reporting period
Receivables back to non-defaulted status
Amounts written off
Other Changes
Defaulted loans and debt securities at end of the reporting period
Current Period
Prior Period
24,445,092
16,050,821
(497,130)
(5,620,823)
(7,165,202)
27,212,758
23,144,846
6,799,033
(1,017,053)
(2,021,889)
(2,459,845)
24,445,092
(1) Indemnified non-cash loans or non-cash loans not converted into cash, of the firms which are followed under “Non-performing Loans” accounts are not included in the table.
36,285,069
3,283,133
c.1.4. Additional Information on Credit Quality of Assets
(1) According to the "Regulation on Measurement and Evaluation of Capital Adequacy of Banks", it is the counterparty credit risk amount calculated for repo style transactions.
(2) The source of the difference is the collateral for receivables under credit risk mitigation in the calculation of capital adequacy.
The differences between financial statements resulting from legal consolidation and the ones resulting from accounting consolidation are mainly due
to the differences in the scope of companies included in consolidation. Legal consolidation only includes partnerships that are in the form of credit
institutions or financial institutions in accordance with Article No 5 of Clause No 1 in the “Communiqué on Preparation of Consolidated Financial
Statements of Banks” while accounting consolidation includes all partnerships regardless of them being in the form of credit institutions or financial
institutions in accordance with Article No 5 of Clause No 6 in the same communiqué.
Bank using the valuation methodology are mainly based on data observed may in accordance with TFRS 13 aims to use methods that measure the fair
value. In this context, securities qualification reality in the fair value measurement of financial assets in the transaction prices, quotes, set by the CBRT
and as the price published in the Official Gazette as are used also necessary from internal pricing models. As for the derivative transactions interest rates,
yield curves, foreign exchange, the basis of valuation models using market data such as volatility curves, valuation service is also available from third
parties.
The market prices used to value the scope of the independent price verification process, data and / or model inputs for accuracy is regularly subjected to
control, as well as compliance of the results provided by the pricing services obtained from third parties with respect to certain ranges tested.
c. Explanations on Credit Risk
c.1. General Information on Credit Risk
c.1.1. General Qualitative Information on Credit risk
Relevant information is given in the footnotes below Section Four footnote II “Explanations on Credit Risk” and Section Four footnote numbered XI-a.1.
c.1.2. Credit Quality of Assets:
Bank’s methods for determining provision amounts and classification of its loans are mentioned in the Section Three Note VIII.
The bank is restructuring its loans classified as first and second group as well as non-performing loans and receivables. Restructuring in performing
loans are made by granting a new loan or extending the term date of credit given to customer by Bank with changing conditions of contract aiming the
enhancing of solvency of customer or customer’s demand. Restructuring in non-performing loans are generally made by establishing a new redemption
plan within the context of a protocol aiming the collection of those receivables whose redemption plan are not valid because of delinquency previously.
The breakdown of receivables in terms of geographic regions, sectors and remaining maturities are represented in “Explanations on Credit Risk” in the
Fourth Section note II.
On the basis of sector-based provisions for receivables are presented in the footnote numbered Section Four II-16. The amounts of the receivables that
are set aside for the geographical regions are as follows. The amount of non-performing loans which are written off in 2022 is TL 5,620,823.
Domestic
EU Countries
OECD Countries (1)
Off-Shore Banking
Regions
USA, Canada
Other Countries
Total
Current Period
Prior Period
Non-Performing Loans
Specific Provisions
Non-Performing Loans
Specific Provisions
26,116,918
19,688,391
23,474,995
15,178,041
750,571
120,031
16,142
10,098
198,998
613,000
55,424
16,142
8,182
184,451
641,517
39,671
44,950
7,731
236,228
471,609
34,495
20,185
6,382
187,892
27,212,758
20,565,590
24,445,092
15,898,604
(1) OECD Countries other than EU countries, USA and Canada.
The aging analysis of past-due receivables are disclosed under Section Four note II-11.
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Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
c.2. Credit Risk Mitigation
c.2.1. Qualitative Public Disclosures on Credit Risk Mitigation Techniques
c.3.2. Standard Approach: Credit risk exposure and credit risk mitigation effects:
In the calculation of the Group’s Credit Risk Mitigation in accordance with the “Communiqué on Credit Risk Mitigation Techniques” published in the
Official Gazette numbered 29111 on September 6, 2014, the financial collaterals are taken into consideration. The Group takes local currency and foreign
currency deposit pledges into consideration as financial collaterals in calculating regulatory capital adequacy.
Colleteral valuation and its management policy and primary features processes are givin are given at Section Four note.II under “Information on Credit
Risk” disclosure.
Current Period
c.2.2. Credit Risk Mitigation Techniques – Standard Approach
Exposures to sovereigns and their central banks
434,245,075
Current Period
Exposures
unsecured
Exposures
secured by
collateral
Collateralized
amount of
exposures
secured by
collateral
Exposures
secured by
financial
guarantees
Collateralized
amount of
exposures
secured by
financial
guarantees
Exposures
secured
by credit
derivatives
Collateralized
amount of
exposures
secured
by credit
derivatives
Loans
856,149,996
18,966,900
16,617,735
16,681,247
15,067,525
Debt securities
301,641,082
Total
1,157,791,078
18,966,900
16,617,735
16,681,247
15,067,525
Of which defaulted
26,252,601
Prior Period
Exposures
unsecured
Exposures
secured by
collateral
Collateralized
amount of
exposures
secured by
collateral
Exposures
secured by
financial
guarantees
Collateralized
amount of
exposures
secured by
financial
guarantees
Exposures
secured
by credit
derivatives
Collateralized
amount of
exposures
secured
by credit
derivatives
Loans (1)
Debt securities
Total
577,741,977
10,355,755
8,618,981
10,746,384
9,724,012
153,871,817
731,613,794
10,355,755
8,618,981
10,746,384
9,724,012
Of which defaulted
23,623,595
(1) Credit balance which is monitored as Financial Assets at Fair Value Through Profit or Loss is not included in the above table. It is shown in detail in Section 5 footnote 1.b.3.
c.3. Credit Risk Under Standardised Approach
c.3.1. Qualitative Disclosures on Banks’ Use of External Credit Ratings Under the Standardised Approach for Credit Risk
Aformentioned explanations are disclosed under Section Four note XI-a.1.
Exposures to regional and local governments
Exposures to administrative bodies and non-commercial entities
Exposures to multilateral development banks
Exposures to international organizations
Exposures to banks and securities firms
Exposures to corporates
Retail exposures
Exposures secured by residential property
Exposures secured by commercial property
Past-due Receivables
Exposures in higher-risk categories
Exposures in the form of bonds secured by mortgages
Short term exposures to banks, brokerage houses and corporates
Equity investments in the form of collective investment
Undertakings
Other exposures
Equity investments
Total
Prior Period
Exposures before CCF
and CRM
Exposures post-CCF and CRM
RWA and RWA density
On-balance
sheet amount
Off-balance
sheet amount
On-balance
sheet amount
Off-balance
sheet amount
Risk-
Weighted
Amount
Risk-
Weighted
Amount
Density
192,016
83,618
779,142
13,177
1,581
199,794
447,474,160
3,753,665
9,371,832
191,900
81,656
779,142
267
84,338
96,097
165,994
56,939,132
26,478,824
56,850,323
24,976,239
25,682,713
442,392,789
232,934,925
420,330,000
119,287,731
471,218,676
262,979,575
153,859,482
257,489,378
7,936,819
147,526,675
33,886,107
29,832,148
6,344,324
92,795,173
2,424,138
33,793,420
4,975,290
29,832,148
1,121,348
3,155,777
6,344,324
12,220,169
19,936,999
4,655,385
1,575,017
92,480,332
145,490
155,142,393
167.49%
2.08%
50.01%
100.00%
0.00%
31.39%
87.32%
77.75%
35.00%
60.44%
73.38%
9,016,377
35,000
9,016,377
35,000
9,051,377
100.00%
85,988,169
44,442,556
5,433,668
85,988,169
2,276,766
75,196,954
44,442,556
45,020,394
1,499,916,201
427,930,896 1,485,093,885
162,773,440
975,285,658
85.19%
101.30%
59.18%
Exposures before CCF
and CRM
Exposures post-CCF and CRM
RWA and RWA density
On-balance
sheet amount
Off-balance
sheet amount
On-balance
sheet amount
Off-balance
sheet amount
Risk-
Weighted
Amount
Risk-
Weighted
Amount
Density
Exposures to sovereigns and their central banks
270,036,409
329,185
278,093,661
9,801,001
3,736,206
Exposures to regional and local governments
Exposures to administrative bodies and non-commercial entities
Exposures to multilateral development banks
Exposures to international organizations
Exposures to banks and securities firms
Exposures to corporates
Retail exposures
Exposures secured by residential property
Exposures secured by commercial property
Past-due loans
343,195
508,227
363,923
870
231,567
343,084
503,596
363,923
267
100,558
171,690
604,154
42,040,070
21,847,240
42,026,622
18,633,667
19,713,260
297,665,741
163,392,828
286,624,208
92,890,256
349,203,244
168,884,127
74,776,645
165,426,261
5,834,808
97,377,938
24,218,278
25,979,947
7,773,698
1,362,521
3,621,770
24,171,145
605,213
8,671,725
25,979,947
2,519,999
17,569,776
7,773,698
6,179,114
1.30%
50.00%
100.00%
0.00%
32.50%
92.01%
76.00%
35.00%
61.65%
79.49%
Exposures in higher-risk categories
24,046,483
1,246,361
23,726,962
150,646
35,579,530
149.01%
Exposures in the form of bonds secured by mortgages
Short term exposures to banks, brokerage houses and corporates
Equity investments in the form of collective investment
Undertakings
Equity investments
Other exposures
Total
2,633,178
50,000
2,633,178
50,000
2,683,178
100.00%
38,233,010
23,010,720
21,864,123
38,233,010
131,274
23,010,720
27,051,365
23,431,014
925,737,006
288,723,110
918,910,015
130,717,689
591,972,194
70.47%
101.83%
56.39%
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Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
c.3.3. Standardised Approach: Receivables according to risk classes and risk weights:
Current Period
Risk Groups
Exposures to
sovereigns and
their central banks
Exposures to
regional and local
governments
Exposures to
administrative
bodies and
non-commercial
entities
Exposures to
multilateral
development
banks
Exposures to
international
organizations
Exposures
to banks and
securities firms
Exposures to
corporates
0% (1)
10%
20%
25%
35%
50%
75%
100%
150%
250%
Other
Total
Risk Weights
Consolidated
442,251,035
10
8,186,687
790,093
451,227,825
192,141
26
165,994
192,167
165,994
779,142
779,142
47,567
50,119,307
29,313,170
814,209
106,359
1,425,950
81,826,562
289,336
52,262,981
43,654,776
438,365,543
319,085
4,726,010
539,617,731
Önceki Dönem
Risk Groups
Exposures to
sovereigns and
their central banks
Exposures to
regional and local
governments
Exposures to
administrative
bodies and
non-commercial
entities
Exposures to
multilateral
development
banks
Exposures to
international
organizations
Exposures
to banks and
securities firms
Exposures to
corporates
0%
10%
20%
25%
35%
50%
75%
100%
150%
250%
Other
Total
Risk Ağırlıkları
Konsolide
283,985,271
346,370
3,563,021
287,894,662
343,323
28
604,154
343,351
604,154
363,923
363,923
36,648,915
22,931,570
897,484
11,190
171,130
60,660,289
782,189
19,999,364
26,602,963
331,589,700
203,638
336,610
379,514,464
Retail exposures
75,579,854
169,278,670
20,567,673
265,426,197
Retail exposures
43,109,482
123,094,596
5,056,991
Exposures
secured by
residential
property
Exposures
secured by
commercial
property
Past-due loans
Exposures in
higher-risk
categories
Exposures in the
form of bonds
secured by
mortgages
Short term
exposures to
banks, brokerage
houses and
corporates
Equity
investments in the
form of collective
investment
Undertakings
Equity
investments
Other exposures
12,982,103
107,346
34,914,768
26,101,851
6,886,074
3,382,239
2,957,725
4,360
34,914,768
32,987,925
6,344,324
163,763
217,237 59,660,202
32,584,620
92,625,822
9,051,377
44,057,331
75,175,486
385,225
9,051,377
44,442,556
88,264,935
Exposures
secured by
residential
property
Exposures
secured by
commercial
property
Past-due loans
Exposures in
higher-risk
categories
Exposures in the
form of bonds
secured by
mortgages
Short term
exposures to
banks, brokerage
houses and
corporates
Equity
investments in the
form of collective
investment
Undertakings
Equity
investments
Other exposures
11,312,919
24,776,358
21,860,341
6,639,605
3,400,695
4,161,476
211,527
125,189
223,387 23,529,032
171,261,069
24,776,358
28,499,946
7,773,698
23,877,608
2,683,178
22,730,524
27,051,365
280,196
2,683,178
23,010,720
38,364,284
Total
531,929,037
102,489,634
34,914,768 102,807,950 169,278,670 606,445,362 60,880,099 385,225 38,736,580
1,647,867,325
Total
339,553,784
56,648,279
24,776,358 75,610,451 123,094,596 405,200,913 23,955,387 280,196
507,740 1,049,627,704
(1) Yatırım Varlık Kiralama A.Ş. with transactions of one of the group companies that are not subject to credit risk of Anadolu Hayat Emeklilik A.Ş..It also includes securities that the company blocks on behalf of its insured
persons, as well as individual pension receivables.
(1) Anadolu Hayat Emeklilik A.Ş. of the group companies.it also includes securities that the company blocks on behalf of its insured persons, as well as individual pension receivables.
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Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
d. Explanations on Counterparty credit risk
d.1. Qualitative Disclosures on Counterparty Credit Risk Approach
The counterparty credit risk that the Parent Bank exposed to is managed within the framework of general limit allocation and credit risk mitigaiton
that are outlined the Credit Risk Policy of the Bank. In setting general credit limits, the counterparty credit risks of customers as well as their cash and
noncash risks are taken into account with a holistic view. Moreover, the total position of the transactions which create counterparty credit risk is also
monitored under a separate risk limit.
The counterparty credit risk, which stems from derivatives and repo like transactions including transactions with qualified central counterparties that result in
liabilities for both sides, is measured according to the Appendix-2 and Appendix-4 of the "Regulation on Measurement and Evaluation of Capital Adequacy
of Banks" Counterparty credit risk valuation method based on the calculation of fair values of the derivative transactions is implemented. In the process
of calculating the counterparty credit risk, the Standard Approach is used to determine the risk amounts of derivative transactions. In calculating the risk
amount related to derivative transactions; 1.4 times the sum of potential credit risk amounts and positive replacement costs is charged.
Most of the credit risk related to the derivative transactions with other banks is subject to daily collateral clearing agreements mutually signed with
related parties and the counterparty credit risk is hence reduced. There are no guarantees received or sold by credit derivatives by the Bank in the
context of trading or banking accounts.
d.2. Counterparty Credit Risk (CCR) Approach Analysis:
Current Period
Replacement
Cost
Potential
Future
Exposure
EEPE (Effective
Expected
Positive
Exposure)
Alpha used
for computing
regulatory EAD
Exposure
after
Credit Risk
Mitigation
Risk
Weighted
Amounts
Standardised Approach- CCR (for derivatives)
6,173,921 6,698,105
1,4
12,872,026
7,755,594
Current Period
Replacement
Cost
Potential
Future
Exposure
EEPE (Effective
Expected
Positive
Exposure)
Alpha used
for computing
regulatory
EAD
Exposure
after
Credit Risk
Mitigation
Risk
Weighted
Amounts
Standardised Approach- CCR (for derivatives)
17,111,025
3,145,731
1,4
20,256,756
8,723,392
Internal Model Method (for repo transactions,
securities or commodity lending or borrowing
transactions, long settlement transactions and
securities financing transactions)
Simple Approach for credit risk mitigation (for
repo transactions, securities or commodity
lending or borrowing transactions, long
settlement transactions and securities financing
transactions)
Comprehensive Approach for credit risk
mitigation (for repo transactions, securities or
commodity lending or borrowing transactions,
long settlement transactions and securities
financing transactions)
Value-at-Risk (VaR) (for repo transactions,
securities or commodity lending or borrowing
transactions, long settlement transactions and
securities financing transactions)
Total
Internal Model Method (for repo transactions,
securities or commodity lending or borrowing
transactions, long settlement transactions and
securities financing transactions)
Simple Approach for credit risk mitigation (for
repo transactions, securities or commodity
lending or borrowing transactions, long
settlement transactions and securities financing
transactions)
Comprehensive Approach for credit risk
mitigation (for repo transactions, securities or
commodity lending or borrowing transactions,
long settlement transactions and securities
financing transactions)
Value-at-Risk (VaR) (for repo transactions,
securities or commodity lending or borrowing
transactions, long settlement transactions and
securities financing transactions)
Total
d.3. Capital obligation for credit valuation adjustment (CVA):
Total portfolios subject to the Advanced CVA capital obligation
(i) VaR component (including the 3x multiplier)
(ii) Stressed VaR component (including the 3x multiplier)
All portfolios subject to the Standardised CVA capital obligation
Total subject to the CVA capital change
d.4. CCR Exposures by risk class and risk weights:
Current Period
Prior Period
Risk Amounts
Risk Weighted
Amounts
Risk Amounts
Risk Weighted
Amounts
12,872,026
12,872,026
4,648,339
4,648,339
20,256,756
20,256,756
6,743,838
6,743,838
Current Period
Risk Groups
0%
10%
20%
50%
75 %
100%
150% Other (1)
Risk Weights
Total Credit
Exposure
3,701,159
609
609
Conditional and unconditional exposures to
sovereigns and their central banks
3,701,159
Conditional and unconditional exposures to
regional and local governments
Conditional and unconditional exposures to
administrative bodies and non-commercial
entities
Conditional and unconditional exposures to
multilateral development banks
Conditional and unconditional exposures to
international organizations
Conditional and unconditional exposures to
banks and securities firms
Retail exposures
Other exposures
Total
10,017,752
3,868,472
Exposures to corporates
294,945
265,540
7,237,395
5,030,098
6,326,963
1
33,068
11,357,062
7,797,880
33,068
6,151,960
6,151,960
3,701,159
5,325,043
6,592,503 33,068 7,238,005
6,151,960 29,041,738
11,624,066
(1) Diğer alacaklar, “d.7. Merkezi karşı tarafa olan riskler” tablosunda raporlanan tutarları içerir.
Prior Period
Risk Groups
0%
10%
20%
50%
75 %
100%
150%
Other (1)
Risk Weights
Total Credit
Exposure
9,501,019
Conditional and unconditional exposures
to sovereigns and their central banks
9,501,019
Conditional and unconditional exposures
to regional and local governments
Conditional and unconditional exposures
to administrative bodies and non-
commercial entities
Conditional and unconditional exposures
to multilateral development banks
Conditional and unconditional exposures
to international organizations
Conditional and unconditional exposures
to banks and securities firms
2,822,386
5,339,074
5,788
5,788
4,896,829
1,616,356
Exposures to corporates
256,646
343,990
6,852,442
Retail exposures
Other exposures
Total
32,240
8,161,460
7,453,078
32,240
507,740
507,740
9,501,019
3,079,032 5,683,064 32,240
6,858,230
507,740
25,661,325
10,339,748
(1) Diğer alacaklar, “d.7. Merkezi karşı tarafa olan riskler” tablosunda raporlanan tutarları içerir.
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Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
d.5. Collateral for CCR:
Current Period
Cash- Domestic Currency
Cash- Other Currencies
Government bills/bonds-Domestic
Total
Önceki Dönem
Cash- Domestic Currency
Cash- Other Currencies
Government bills/bonds-Domestic
Total
d.6. Credit derivatives exposures:
None.
Collateral used in derivative transactions
Received Collateral
Given Collateral
Collateral used in other
transactions
Segregated
Not
Segregated
Segregated
Not
Segregated
Received
Collateral
Given
Collateral
27.918.747
14.516.341
176.935
42.612.023
Collateral used in derivative transactions
Alınan Teminatlar
Verilen Teminatlar
Collateral used in other
transactions
Segregated
Not
Segregated
Segregated
Not
Segregated
Alınan
Teminatlar
Verilen
Teminatlar
40.504.926
10.535.283
297.843
51.338.052
Current Period
Prior Period
Post CRM risk
exposure
RWA
Post CRM risk
exposure
RWA
6.151.960
6.141.646
134.661
123.039
122.833
507.740
505.714
12.738
10.155
10.114
10.314
206
2.026
41
276.977
194.244
69.551
11.622
101.545
2.583
d.7. Exposures to central counterparties (CCP):
Exposure to Qualified Central Counterparties (QCCPs)
(total)
Exposures for trades at WCCPs (excluding initial margin and
default fund contributions); of which
(i) OTC Derivatives
(ii) Exchange-traded Derivatives
(iii) Repo-reverse transactions, credit securities transactions
and securities or commodities lending or borrowing
(iv) Netting sets where cross-product has been approved
Segregated initial margin
Non-segregated initial margin
Paid guarantee fund amount
Unpaid guarantee fund commitment
Exposures to non-QCCPs (total)
Exposures for trades at non-QCCPs (excluding initial margin and
default fund contributions); of which
(i) OTC Derivatives
(ii) Exchange-traded Derivatives
(iii) Repo-reverse transactions, credit securities transactions
and securities or commodities lending or borrowing
(iv) Netting sets where cross-product has been approved
Segregated initial margin
Non-segregated initial margin
Pre-funded default fund contributions
Unfunded default fund contributions
e. Explanations on securitisations:
None.
f.
f. Explanations on Market Risk:
f.1. Qualitative information disclosed to the public regarding Market Risk
Market risk is defined as the risk that may reduce the market value of the trading portfolio due to the changes in the risk factors named interest rate,
exchange rates, equities and the price of commodities and options.
The procedures for the management of market risk are discussed in the Parent Bank's "Asset and Liability Management Risk Policy" and those
procedures are in line with the risk/return expectations and with the limits that are defined in the risk appetite framework. Limits related to market risk; are
established by the Board and are revised periodically in order to reflect market conditions and best practices in the industry. Compliance to those limits
is closely monitored by the Risk Management Department, Asset and Liability Management Committee and by the executive departments. Additionally,
compliance with the provisions relating to the procedures and policies of market risk management is audited by the internal audit system.
Trading activities of the securities that are included in the calculation of market risk is carried out by taking the Asset-Liability Management Committee
decisions, risk policies and established limits into consideration and risks arising due to these activities are hedged using derivatives transactions where
necessary.
Measurement of market risk, reporting of results, and monitoring compliance with the risk limits are among the key responsibilities of the Risk
Management Department. Analyses related to market risk are reported to the Risk Comittee and to the Board via the Audit Committee by the Risk
Management Deparment.
The trading book of the Parent Bank included in market risk calculations consists of on balance-sheet financial assets that are held for trading intent,
derivatives that provide hedge to those instruments and foreign currency positions. The market risk carried by the Group is measured and monitored
using methods known respectively as the Standard Method and the Value at Risk Model (VAR) and Expected Shortfall in accordance with the local
regulations which are established in compliance with the international legislations. In this context, the exchange rate risk emerges as the most important
component of the market risk.
The market risk calculations using the Standard Method are performed at the end of each month and the measurement results are included in the
statutory reports as well as being reported to the Bank’s top management.
The Value at Risk Model and Expected Shortfall is another alternative for the Standard Method used for measuring and monitoring market risk. This
model is used to measure the market risk on a daily basis in terms of interest rate risk, currency risk and equity share risk and is a part of the Bank’s daily
internal reporting. Further retrospective testing (back-testing) is carried out on a daily basis to determine the reliability of the daily risk calculation by the
VAR model, which is used to estimate the maximum possible loss for the following day.
Scenario analyses which support the VAR model used to measure the losses that may occur in the ordinary market conditions are practiced, and the
possible impacts of scenarios that are developed based on the future predictions and the past crises, on the value of the Bank’s portfolio
f.2. Standardised Approach
Outright Products
Interest rate risk (general and specific)
Equity risk (general and specific)
Foreign exchange risk
Commodity risk
Options
Simplified approach
Delta-plus method
Scenario approach
Securitisations
Total
Current Period
Prior Period
RWA
41,380,414
6,589,513
6,289,388
24,489,138
4,012,375
839,949
21,625,301
4,991,613
1,222,400
12,624,138
2,787,150
1,049,024
839,949
1,049,024
42,220,363
22,674,325
g. Explanations on Operational Risk
The operational risk capital requirement is calculated according to “Regulation on Measurement and Evaluation of Capital Adequacy of Banks”
article number 24, is measured using the Basic Indicator Approach once a year in parallel with domestic regulations. As of December 31, 2022, the
consolidated operational risk amount is TL 65,807,811 information about the calculation is given below (December 31, 2021: TL 51,469,094).
Current Period
2PP Amount
1PP Amount
CP Amount
Total/Positive Years
of Gross Income
Amount
Rate (%)
Total
Gross Income
24,912,326
35,126,147
45,254,025
3
15
5,264,625
Value at operational risk (Total*12.5)
65,807,811
Prior Period
2PP Amount
1PP Amount
CP Amount
Total/Positive
Years of Gross
Income Amount
Rate (%)
Total
Gross Income
22,312,078
24,912,326
35,126,147
3
15
4,117,528
Value at operational risk (Total*12.5)
51,469,094
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Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
h. The interest rate risk of the banking book items:
XII.
Explanations on Segment Reporting
Interest rate risk arising from the banking accounts is defined as negative effect risk on capital of the changes in market interest rates due to differences
in interest settlement and re-pricing on, differences in interest-earning assets taking part in the banking book; interest-bearing liabilities; interest-bearing
derivative transactions inclusive of the policies established by the Board of Directors, is managed within the framework of the strategies set by the
Parent Bank Asset-Liability Management Committee. Compliance with internal risk limits for banking portfolio is closely and continuously monitored by
the Risk Management Department and Asset-Liability Managemant Committee and the measurement results are reported to the Board of Directors on
a monthly basis.
Duration and sensitivity analysis are conducted on a monthly basis by the Bank in the scope of monitoring of interest rate risk arising from the banking
books about Interest Rate Risk in the Banking Accounts from the Regulation on Measurement and Assessment of Standard Shock Method which
is published in the Official Gazette No. 28034 dated August 23, 2011. In the duration analysis, the maturity gap between assets and liabilities of the
balance sheet are determined by the calculation of the weighted average maturities based on the asset that sensitive to interest rate and liabilities and
off-balance sheet transactions re-pricing period. In the interest rate risk sensitivity analysis, the influence of the various interest rate change scenarios to
the economic value of the Bank's capital is examined.
In the calculations made within the framework of the said regulation, behavioral maturity modeling is performed for demand deposits with low sensitivity
to interest changes and whose original maturity is longer than the contractual maturity. In these studies, which are defined as core deposit analysis,
based on historical data, calculations are made for what amount of demand deposits will remain within the bank for what maturity, and these analyzes
are used as an input in quantifying the interest rate risk arising from banking accounts in a way that does not contradict legal provisions.
Currency
Applied Shock
(+/- x basis point)
Gains Loss
Revenue/Shareholders’ Equity –
Loss/ Shareholders’ Equity
TL
TL
EUR
EUR
USD
USD
Total (for Negative Shocks)
Total (for Positive Shocks)
i. Remuneration policy:
(+) 500
(-) 400
(+) 200
(-) 200
(+) 200
(-) 200
(11,670,706)
10,850,819
1,455,039
(1,457,745)
(1,984,592)
3,182,748
12,575,822
(12,200,259)
(5.17) %
4.81%
0.64%
(0.65) %
(0.88) %
1.41%
5.57%
(5.41) %
The Remuneration Committee, which is established to carry out the duties and activities related to the monitoring and supervision of the Bank's
remuneration applications on behalf of the Board of Directors, consists of two members. The Remuneration Committee meets at least twice a year, not
exceeding six months, and reports to the Board of Directors on the results of the activities carried out and important matters considered to have an
impact on the Bank’s position. As of the end of 2022, the Remuneration Committee met 8 times and made a total of 12 decisions.
Regarding compliance with the Corporate Governance Principles, the Remuneration Committee monitors and supervises the practices related to
wage management on behalf of the Board of Directors; the fees are in line with the Bank's ethical values, internal balances and strategic objectives;
the evaluation of the remuneration policy and its practices in the context of risk management; it is responsible for the presentation of the proposals
determined in line with the requirements of the salary policy and the other responsibilities determined by the provisions of the applicable legislation and
the fulfillment of the duties given by the Board of Directors in this framework.
As of the end of 2022, the number of qualified employees working at the Bank is 29.
The monetary and social rights of employees are determined in accordance with the Chartering Policy in the framework of the legislation related to the
Collective Labor Agreement. The Bank carries out its practices with regard to remuneration policies within the framework of relevant banking and capital
market legislation. This policy includes all managers and employees.
Premium payments are made once a year to managers and managers who work in branches and headquarters units. It is considered that managerial
premium payments are in line with the Bank's long-term strategy and the risks assumed, as well as the performance of its employees. There are no
variable fees for qualified employees in the Bank.
The compliance of the wage levels in the bank with the sector wage levels is monitored by participating in independent and anonymous wage surveys,
which are held twice a year.
Within the scope of the remuneration policy, the Bank's pricing practices are planned and executed on the basis of effective risk management,
prevention of excessive risk taking, compliance with relevant legislation and scope and structure of the bank's activities, strategies, long-term objectives
and risk management structures.
The fees to be paid to the managers and employees of the Bank at every stage; It is essential that the Bank is in line with its ethical values, internal
balances and strategic objectives, and that it is not only associated with its short-term performance.
Payments made to employees are determined in a manner that will positively impact the Bank's corporate values and on the basis of objective
conditions.
Payments to be made to the managers of the units within the internal systems and to their staff are determined by taking into account the performance
of the relevant personnel in relation to their functions, as they are in the audit or oversight, or are independent of the performance of the activity unit they
control.
The Group's activities are classified under corporate/commercial banking, retail/private banking, treasury operations and investment activities, insurance
and reinsurance activities and others.
Services to the large corporations, SMEs and other trading companies are provided through various financial instruments within the scope of the
corporate and commercial operations. Services such as project financing, operating and investment loans, deposit and cash management, credit cards,
cheques and bills, foreign trade transactions and financing, letter of guarantee, letter of credit, forfeiting, foreign currency trading, bill collections, payrolls,
investment accounts, tax collections and other banking services are provided to the aforementioned customer segments.
Retail banking services include deposits, consumer loans, overdraft accounts, credit cards, bill collections, remittances, foreign currency trading,
safe-deposit boxes, insurance, tax collections, and investment accounts and other banking services for individuals. All kinds of financing and cash
management services provided to individuals in the high-income level are recognized as Private Banking activities.
Treasury transactions are comprised of medium and long-term funding tools such as securities trading, money market transactions, spot and forward
TL and foreign currency trading, and derivative transactions such as forwards, swaps, futures and options, as well as syndications and securitizations.
Investment activities of intermediary institutions and venture capital and real estate investment partnerships are also classified in this area. Investments
of subsidiaries who operate in the real sector, investments of associates who operate both in financial and real sector and investments of jointly
controlled entities that are presented in the consolidated financial statements are evaluated within the scope of investment activities.
Insurance and reinsurance activities include individual pension, life/non-life insurance transactions and reinsurance transactions.
The Group's financial leasing, factoring, asset management, portfolio management and payment service activities are classified under the ‘Other’ heading.
Information about The Group’s segments are presented below.
Current Period
Corporate /
Commercial Banking
Individual /
Private Banking
Treasury Transaction/
Investment Activities
Insurance and
Reinsurance Activities
Other/
Toplam
Interest Income
Interest Expense
Fees and Commissions Income
Fees and Commissions Expense
Dividend Income
Trading Income/Loss (Net)
Other Income
Expected Credit Loss and Other Provision Expenses
Other Operating Expense
Income/Loss from Investments in Subsidiaries
Accounted by Equity Method
Income Before Tax
Tax Provision
Net Period Profit
Group Profit/Loss
Minority Interest Profit/Loss
67,042,585
16,977,011
14,347,822
7,894
20,194,594
16,265,665
5,207,277
4,238
3,173,448
7,017,495
5,592,533
503,115
1,568,084
13,410,401
49,296,102
15,667,828
1,541,524
203,956
263,526
19,477,788
6,078,934
141,934
1,321,083
10,205,448
52
169,345
2,449,744
4,058,692
5,250,041
852,247
4,780,968
20,192,624
209,159
22,851,051
2,625,765
10,294,403
16,706,576
140,591,973
54,160,597
22,118,215
7,446,800
263,526
19,477,788
32,573,886
19,231,075
59,881,644
10,205,448
84,510,720
15,453,038
69,057,682
61,598,670
7,459,012
Total Assets
Total Liabilities
672,190,029
157,614,122
480,658,344 495,054,758
491,060,752
281,996,061
90,261,982
127,426,701 330,295,705
304,304,684
1,715,431,569
1,715,431,569
Current Period
Corporate /
Commercial Banking
Individual /
Private Banking
Treasury Transaction/
Investment Activities
Insurance and
Reinsurance Activities
Other/
Toplam
Interest Income
Interest Expense
Fees and Commissions Income
Fees and Commissions Expense
Dividend Income
Trading Income/Loss (Net)
Other Income
Expected Credit Loss and Other Provision Expenses
Other Operating Expense
Income/Loss from Investments in Subsidiaries
Accounted by Equity Method
Income Before Tax
Tax Provision
Net Period Profit
Group Profit/Loss
Minority Interest Profit/Loss
35,382,354
6,667,695
6,236,181
13,499
12,353,944
10,642,224
2,709,306
2,633,690
7,091,015
2,543,719
307,201
688,195
6,078,683
19,913,033
13,683,018
837,356
103,959
68,548
703,452
1,121,310
73,446
677,308
4,874,850
21
95,798
1,514,562
1,799,856
1,537,406
612,123
2,166,889
11,010,299
137,851
12,703,259
1,811,190
8,819,983
8,378,440
69,449,187
32,530,364
10,490,764
3,798,909
68,548
703,452
16,883,690
16,810,490
30,381,409
4,874,850
18,949,319
3,389,061
15,560,258
13,541,060
2,019,198
Total Assets
Total Liabilities
469,775,712
99,696,826
305,769,418 338,253,903
276,497,395
247,862,699
50,825,252
72,750,401
227,608,888
159,767,652
1,124,404,073
1,124,404,073
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen
382 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 383
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
SECTION FIVE: DISCLOSURES AND FOOTNOTES ON THE CONSOLIDATED FINANCIAL STATEMENTS
I.
a.
a.1.
DISCLOSURES AND FOOTNOTES ON CONSOLIDATED ASSETS
Cash and Central Bank of the Republic of Turkey:
Information on Cash and Balances with the Central Bank of the Republic of Turkey:
Cash in TL / Foreign Currency
4,109,112
11,719,560
2,627,722
12,234,865
Central Bank of the Republic of Turkey
17,609,487
167,972,940
14,667,660
154,122,778
Current Period
Prior Period
TL
FC
TL
FC
After the collection of the sales process, any special purpose entity that is the subject of the guarantee granted to the company which is under Financial
Assets at Fair Value Through Profit and Loss and the loan amounting to TL 4,475,966, for which impairment provision has been made, was classified as
non-performing loans as of 30.06.2022 and it was written off within the framework of the " Procedures and Principals regarding Classification of Loans
and Allowances Allocated for Such Loans ".
The shares in the amount of TL 526,236, which are tracked under “Impairment Losses on Assets Held for Sale and Subject to Discontinued Operations”
and were reserved for the entire decrease in value, were deleted from the asset together with the decrease in value provision within the scope of
registration of the liquidation of the company in the Türkiye Sicil Gazetesi dated 28.12.2022 and numbered 10735.
b.4. TL 2,039,931 of other financial assets consists of the mutual funds; Quasar İstanbul Konut Gayrimenkul and Quasar İstanbul Ticari Gayrimenkul
which were founded by İş Portföy Yönetimi A.Ş.
c.
Positive differences on derivative financial assets held for trading:
Other
Total
434,800
368,200
21,718,599
180,127,300
17,295,382
166,725,843
Derivative Financial Assets at Fair Value through
Profit or Loss (1)
a.2. Information on Balances with the CBRT:
Unrestricted Demand Deposit
Unrestricted Time Deposit
Restricted Time Deposit
Other (1)
Total
Current Period
Prior Period
TL
FC
TL
FC
17,609,487
45,917,045
14,667,660
66,691,645
7,453,446
114,602,449
87,431,133
17,609,487
167,972,940
14,667,660
154,122,778
(1) The amount of reserve deposits held at the Central Bank of the Republic of Turkey.
a.3. Explanations on reserve requirement application:
As per the Communiqué no. 2013/15 “Reserve Deposits” of the Central Bank of the Republic of Turkey (“CBRT”), banks keep reserve deposits at the
CBRT for their TL and FC liabilities mentioned in the communiqué. The reserve deposit rates vary according to their maturity compositions; the reserve
deposit rates are realized between 3% - 8% for TL deposits and other liabilities, between 19% - 26% for FC deposits and precious metal deposit
accounts and between 5% - 21% for other FC liabilities. Liabilities subject to required reserves are calculated and set aside every two weeks on Friday for
14-day periods.
According to the Communique on Required Reserves published in the Official Gazette dated 01.07.2021 and numbered 31528, the possibility of
establishing Turkish lira required reserves in foreign currency was terminated as of 01.10.2021.
Within the scope of the CBRT's Communiqué numbered 2021/14, additional required reserve and commission application for foreign currency
deposit accounts, effective as of 02.09.2022, according to the conversion rate into Turkish lira time deposit accounts; It has been terminated with the
Communiqué numbered 2022/30 published in the Official Gazette dated 31.12.2022 and numbered 32060 with the 5th repetition, effective from the
liability period dated 23.12.2022.
On the other hand, as of 23.12.2022, the commission rate to be calculated over the required reserve amount for foreign currency deposit liabilities; In
both real and legal person deposits, it is determined as 8% per annum for banks with a Turkish Lira deposit share below 50%, and 3% per annum for
banks with a 50% to 60% deposit share.
b.
b.1.
Information on Financial Assets at Fair Value through Profit and Loss:
Financial assets at fair value through profit and loss, which are given as collateral or blocked:
Financial assets at fair value through profit and loss, which are given as collateral or blocked as of 31 December 2022, amount to TL 16,575,962
(December 31, 2021: 5,872,223 TL).
b.2.
Financial assets at fair value through profit and loss, which are subject to repurchase agreements:
Financial assets at fair value through profit and loss, which are subject to repurchase agreements as of 31 December 2022, amount to TL 217,562
(December 31, 2021: TL 164,956).
b.3. All creditors including the Group reached an agreement on restructuring the loans granted to a company. As previously stated, loans of the
company had been planning to be restructured based on required permits and necessary approvals within a new special purpose entity which was
already incorporated or will be incorporated in the Republic of Turkey and owned by the creditors either directly or indirectly through takeover of the
shares, that have been pledged by the company as a guarantee for the credit risk. Above mentioned process was completed in 2018 and, in this context
the Bank owns 11.5972% and Türkiye Sınai Kalkınma Bankası A.Ş, a group company, owns 1.6172% of the newly formed special purpose entity.
At the Ordinary Meeting of the General Assembly of 2018 held in 2019, it has been decided to increase the share capital of the mentioned company by
TL 3,982,230, all to be covered by common receivables. Whereas the Bank’s and Türkiye Sınai Kalkınma Bankası A.Ş.’ ownership ratio in company share
have not changed, the nominal value of the shares owned increased from TL 6 to TL 461,833 and from TL 1 to TL 64,403 respectively. Related amount
is held under Assets Held for Sale and Discontinued Operations account, while the loan amount remaining after the capital increase is held under the
Financial Assets at Fair Value Through Profit and Loss item on 10.03.2022, a share transfer agreement was signed between the company and TVF for
the sale of all A group registered shares, corresponding to 55% of the company's capital, to Türkiye Varlık Fonu (TVF) and On 31.03.2022, the sale and
transfer transaction was realized.
Forward Transactions
Swap Transactions
Futures
Options
Other
Total
Current Period
Prior Period
TL
316,139
83,046
214,537
FC
708,561
16,423,805
180,080
1,246,555
TL
329,876
168,837
255,887
FC
1,746,980
20,505,483
456,389
1,030,470
613,722
18,559,001
754,600
23,739,322
(1) Includes informationrelated to derivative financial assets held for trading in derivative financial assets. Information on derivative financial assets for hedging purposes is
disclosed in Section Five footnote I.1.
d.
d.1
Banks Account
Information on Banks:
Banks
Domestic Banks
Foreign Banks
Foreign Head Office and Branches
Total
d.2.
Information on foreign banks:
EU Countries
USA, Canada
OECD Countries (1)
Off-shore Banking Regions
Other
Total
Current Period
Prior Period
TL
FC
TP
YP
6,541,346
646,341
1,292,499
30,514,629
2.806.065
168.413
1.476.997
30.743.767
7,187,687
31,807,128
2.974.478
32.220.764
Current Period
Prior Period
Unrestricted Amount
Resticted Amount
Unrestricted Amount
Resticted Amount
11,433,821
2,279,808
4,341,830
5,844,892
23,900,351
1,310,185
977,040
4,973,394
7,260,619
11,894,315
4,947,320
4,458,406
3,914,543
25,214,584
2,569,797
10,603
1,732,114
1,385,082
5,697,596
(1) OECD countries other than the EU countries, USA and Canada.
Expected credit loss for cash and cash equivalents:
Current Period
Prior Period
Stage 1
Stage 2
Stage 3
Stage 1
Stage 2
Stage 3
Provisions beginning of the period
Additional provisions within the period
Transfers within the period
Write-offs from Assets
Transfer to Stage 1
Transfer to Stage 2
Transfer to Stage 3
85,738
74,131
(25,179)
Currency Exchange Difference
Provisions at the end of the period
35,466
170,156
50,476
52,272
(29,196)
12,186
85,738
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen
384 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 385
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
e.
e.1.
Information on Financial Assets at Fair Value through Other Comprehensive Income:
f.3. Information on Maturity analysis of cash loans:
Information on financial assets at fair value through other comprehensive income, which are given as collateral or blocked:
Financial assets at fair value through other comprehensive income, which are given as collateral or blocked, amount to TL 73,609,538 as of 31
December 2022 (December 31, 2021: TL 30,366,014).
e.2.
Information on financial assets at fair value through other comprehensive income, which are subject to repurchase agreements:
Financial assets at fair value through other comprehensive income which are subject to repurchase agreements amount to TL 39,707,583 as of 31
December 2022 (December 31, 2021: TL 34,943,986).
e.3.
Information on financial assets at fair value through other comprehensive income:
Current Period
Prior Period
Debt Securities
Quoted on a Stock Exchange
Not-Quoted (1)
Share Certificates
Quoted on a Stock Exchange
Not-Quoted
Provision for Impairment Losses (-)
Other
Total
204,995,860
76,747,502
128,248,358
1,605,302
21,120
1,584,182
5,943,972
1,468,387
202,125,577
113,649,539
59,680,425
53,969,114
940,712
114,336
826,376
5,382,509
735,917
109,943,659
(1) Refers to the debt securities, which are not quoted on the Stock Exchange, or which are not traded, while quoted, on the Stock Exchange at the end of the related period.
Information related to loans:
f.
Leasing and factoring receivables are considered as loans in the footnotes of this section.
f.1. Leasing and factoring receivables are considered as loans in the footnotes of this section.
Current Period
Prior Period
Cash
Non-Cash
Cash
Non-Cash
Direct Lending to Shareholders
Corporate Shareholders
Individual Shareholders
Indirect Lending to Shareholders
Loans and Other Receivables to Employees
Total
598,361
598,361
1,418
1,418
359,600
359,600
1,404
1,404
f.2. Information about the Standard Loans and Loans Under Close Monitoring and Loans Under Close Monitoring that have been restructured:
Cash Loans
Standard Loans
Loans Under Close Monitoring
Loans Not
Subject to
Restructuring
Restructured Loans
Loans with
Revised Contract
Terms
Refinanced
Non-specialized loans
Corporation Loans
Export Loans
Import Loans
Loans Extended to Financial Sector
Consumer Loans
Credit Cards
Other
Specialized Loans
Other Receivables
Total
12 Month Expected Credit Losses
Significant Increase in Credit Risk
803,401,350
252,406,707
103,263,686
32,072,472
106,705,980
84,734,146
224,218,359
29,401,977
11,182,169
665,196
1,779
9,771,352
2,849,769
4,931,712
31,481,496
18,963,521
48,627
20,866,152
10,938,206
1,042,531
148,556
1,091,940
11,228,852
2,134,800
6,750,615
803,401,350
29,401,977
31,481,496
20,866,152
Current Period
Prior Period
Standard Loans
Loans Under
Close Monitoring
Standard Loans
Loans Under
Close Monitoring
4,718,789
4,191,349
14,637,767
12,735,339
Cash Credit
Short-term Loans
Medium and Long-term Loans
Standard
Loans
338,314,288
465,087,062
Loans Under Close Monitoring
Loans Not Subject to
Restructuring
Refinanced
6,559,317
22,842,660
3,581,039
48,766,609
f.4. Information on consumer loans, retail credit cards, personnel loans and personnel credit cards:
Short-Term
Medium and
Long-Term
Interest and Income
Accruals
Total
Consumer Loans-TL
Real Estate Loans
Vehicle Loans
General Purpose Consumer Loans
Other
Consumer Loans – FC Indexed
Real Estate Loans
Vehicle Loans
General Purpose Consumer Loans
Other
Consumer Loans – FC
Real Estate Loans
Vehicle Loans
9,476,653
52,801
66,714
9,357,138
100,970,141
28,685,188
3,837,024
68,447,929
1,829
1,829
159,345
207,611
21,627
General Purpose Consumer Loans
159,345
185,984
Other
Retail Credit Cards-TL
With Installments
Without Installments
Retail Credit Cards-FC
With Installments
Without Installments
Personnel Loans-TL
Real Estate Loans
Vehicle Loans
General Purpose Consumer Loans
Other
Personnel Loans- FC Indexed
Real Estate Loans
Vehicle Loans
General Purpose Consumer Loans
Other
Personnel Loans-FC
Real Estate Loans
Vehicle Loans
General Purpose Consumer Loans
Other
Personnel Credit Cards-TL
With Installments
Without Installments
Personnel Credit Cards-FC
With Installments
Without Installments
Overdraft Accounts – TL (real persons)
Overdraft Accounts – FC (real persons)
2,831,098
2,831,098
170,597
7,854
2,693
160,050
5,452
1,547
3,905
7,202
7,202
54,909,240
24,789,032
30,120,208
141,814
141,814
36,014
515
35,499
353
353
311,164
148,532
162,632
1,684
1,684
5,785,122
162,020
1,704,011
354,540
44,964
1,304,507
20,024
20,024
1,391
93
1,298
245,890
62,206
183,684
5,187
164
43
4,980
62
14
48
423
423
54,876
112,150,805
29,092,529
3,948,702
79,109,574
21,853
21,853
368,347
21,720
346,627
57,986,228
27,682,336
30,303,892
141,814
141,814
211,798
8,018
3,251
200,529
5,867
1,561
4,306
318,789
155,734
163,055
1,684
1,684
5,839,998
162,020
Total
70,983,409
104,193,930
2,031,864
177,209,203
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen
386 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 387
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
f.5. Information on commercial installments loans and corporate credit cards:
f.10.2. Information on the movement of total non-performing loans:
Commercial Loans with Installments-TL
Real Estate Loans
Vehicle Loans
General Purpose Commercial Loans
Other
Commercial Loans with Installments-FC Indexed
Real Estate Loans
Vehicle Loans
General Purpose Commercial Loans
Other
Short-Term
Medium and
Long-Term
Interest and Income
Accruals
Total
24,126,058
13,434
3,645,983
20,466,641
73,604,896
3,668,187
24,329,585
45,607,124
85,235
1,779
83,456
1,429,058
35,344
281,916
1,111,798
359,634
7,153
99,160,012
3,716,965
28,257,484
67,185,563
444,869
8,932
352,481
435,937
Commercial Loans with Installments-FC
1,014,798
10,513,341
105,500
11,633,639
Real Estate Loans
Vehicle Loans
General Purpose Commercial Loans
Other
Corporate Credit Cards-TL
With Installments
Without Installments
Corporate Credit Cards-FC
With Installments
Without Installments
Overdraft Accounts – TL
Overdraft Accounts – FC (corporate)
Total
f.6. Distribution of credits according to users:
Public
Private
Total
f.7. Domestic and foreign loans:
Domestic Loans
Foreign Loans
Total
9,628,680
884,661
934,252
934,166
86
82,158
932,640
29,224,515
15,768,852
13,455,663
19,448
19,448
3,233,583
93,271
12,229
49,125
49,125
46,826
9,804,109
1,829,530
30,207,892
16,703,018
13,504,874
19,448
19,448
3,280,409
57,618,402
85,137,724
1,990,143
144,746,269
Current Period
Prior Period
7,172,079
877,978,896
885,150,975
Current Period
Prior Period
851,121,329
34,029,646
885,150,975
f.8. Loans granted to subsidiaries and associates:
Direct Loans Granted to Subsidiaries and Associates
Indirect Loans Granted to Subsidiaries and Associates
Total
f.9. Information on impairment provisions of Loans (Stage 3):
Loans with Limited Collectability
Loans with Doubtful Collectability
Uncollectible Loans
Total
Current Period
Prior Period
2,343,655
2,343,655
Current Period
Prior Period
1,533,076
4,047,910
14,984,604
20,565,590
f.10. Information on non-performing loans (Net):
f.10.1. Information on non-performing loans, which are restructured by the Group:
Current Period
(Gross amounts before the provisions)
Restructured Loans
Prior Period
(Gross amounts before the provisions)
Restructured Loans
Group III
Loans with Limited Collectability
Group IV
Loans with Doubtful Collectability
Group V
Uncollectible Loans
1,486,706
1,486,706
456,906
456,906
1,782,784
1,782,784
1,319,183
1,319,183
6,373,775
6,373,775
3,847,880
3,847,880
7,291,579
583,006,049
590,297,628
563,177,007
27,120,621
590,297,628
2,402,860
2,402,860
1,231,704
1,762,150
12,904,750
15,898,604
Prior Period Ending Balance
Corporate and Commercial Loans
Retail Loans
Credit Cards
Other
Additions (+)
Corporate and Commercial Loans
Retail Loans
Credit Cards
Other
Transfers from Other NPL Categories (+)
Corporate and Commercial Loans
Retail Loans
Credit Cards
Other
Transfers to Other NPL Categories (-)
Corporate and Commercial Loans
Retail Loans
Credit Cards
Other
Collections (-)
Corporate and Commercial Loans
Retail Loans
Credit Cards
Other
Write-Offs (-) (1)
Corporate and Commercial Loans
Retail Loans
Credit Cards
Other
Debt Sale (-) (2)
Corporate and Commercial Loans
Retail Loans
Credit Cards
Other
Currency Exchange Effect
Corporate and Commercial Loans
Retail Loans
Credit Cards
Other
Current Period Ending Balance
Corporate and Commercial Loans
Retail Loans
Credit Cards
Other
Specific Provisions (-)
Corporate and Commercial Loans
Retail Loans
Credit Cards
Other
Net Balance on Balance Sheet
Group III
Loans with Limited
Collectability
Group IV
Loans with Doubtful
Collectability
Group V
Uncollectible Loans
2,354,561
1,788,214
356,344
210,003
11,006,542
7,099,245
2,743,777
1,163,313
207
1,994
1,994
7,924,347
5,171,431
1,963,070
789,639
207
2,465,737
1,539,110
578,909
347,718
521
179
309
33
32,078
30,319
1,759
3,004,570
2,207,058
561,586
235,926
1,533,076
1,098,434
299,277
135,365
1,471,494
3,517,144
3,064,120
291,794
161,230
393,416
363,794
20,771
8,798
53
7,925,177
5,171,431
1,963,900
789,639
207
4,677,683
3,205,034
1,018,513
453,876
260
1,004,086
436,974
373,169
193,943
2,687
2,333
301
53
31
31
399,774
394,694
5,080
6,551,024
5,349,698
889,562
311,764
4,047,910
3,339,122
514,171
194,617
2,503,114
18,573,387
17,263,217
748,570
436,120
125,480
4,650,863
4,598,803
29,900
2,350
19,810
4,675,689
3,205,034
1,016,519
453,876
260
830
830
5,290,970
4,838,517
310,131
137,960
4,362
5,253,641
5,164,691
8,850
6,308
73,792
363,943
122,715
139,108
92,557
9,563
666,609
646,868
19,682
59
17,657,164
15,587,999
1,355,752
655,521
57,892
14,984,604
13,368,073
1,009,106
559,071
48,354
2,672,560
(1) As part of the amendment to the “Regulation on Procedures and Principles on the Classification of Loans and Provisions to be Set Aside for Them” published in the Official
Gazette No. 30961, receivables amounting to TL 5,169,896 were written off. Details of which are given in Note I.b.3 of Section Five, the loan amounting to TL 4.475.966, which is
followed in financial assets at fair value through profit or loss classified as non-performing loans in the current period and has been written off within the framework of “Procedures
and Principals regarding Classification of Loans and Allowances Allocated for Such Loans”.
(2) In the current period, the part of the receivables constitutes non-performing loans amounting to TL 363,974 are transferred to Emir Varlık Yönetim A.Ş. and İstanbul Varlık
Yönetim A.Ş by collecting TL 76,500 of sales amount in cash.
After the sale of non-performing loans and the write-off, the consolidated non-performing loan ratio decreased from 3.57% to 2.98% as of 31.12.2022.
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388 İşbank 2022 Integrated Annual Report
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Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
f.10.3. Information on foreign currency non-performing loans:
Group III
Group IV
Loans with Limited Collectability Loans with Doubtful Collectability
Group V
Uncollectible Loans
Current Period
Balance at the End of the Period
Provisions (-)
Net Balance on Balance Sheet (1)
Prior Period
Balance at the End of the Period
Provisions (-)
Net Balance on Balance Sheet (1)
1,449,347
653,655
795,692
931,130
447,079
484,051
3,293,071
1,566,847
1,726,224
2,390,456
1,141,904
1,248,552
10,598,027
9,161,617
1,436,410
11,033,205
6,923,386
4,109,819
(1) In addition to the loans extended in foreign currency, loans which are monitored in Turkish Lira are included.
f.10.4. Information on gross and net non-performing loans as per customer categories:
Group III
Loans with Limited
Collectability
Group IV
Loans with Doubtful
Collectability
Group V
Uncollectible Loans
Current Period (Net)
Loans to Individuals and Corporate (Gross)
Provisions (-)
Loans to Individuals and Corporate (Net)
Banks (Gross)
Provisions (-)
Banks (Net)
Other Loans (Gross)
Provisions (-)
Other Loans (Net)
Prior Period (Net)
Loans to Individuals and Corporate (Gross)
Provisions (-)
Loans to Individuals and Corporate (Net)
Banks (Gross)
Provisions (-)
Banks (Net)
Other Loans (Gross)
Provisions (-)
Other Loans (Net)
1,471,494
3,004,570
1,533,076
1,471,494
1,122,857
2,354,561
1,231,704
1,122,857
2,503,114
6,551,024
4,047,910
2,503,114
1,754,994
3,517,144
1,762,150
1,754,994
2,672,560
17,599,272
14,936,250
2,663,022
57,892
48,354
9,538
5,668,637
18,447,907
12,789,895
5,658,012
125,480
114,855
10,625
ੵ The portion of the receivables, which are followed under the Fifth Group-Loans with a Loss Qualification and for which a lifetime expected credit loss
provision has been made due to the default of the debtor, for which there is no reasonable expectation of its collection, can be write-off to the extent of
the maximum provision amount,
ੵ Write-off is an accounting practice and does not result in the waiver of the receivable,
The Bank’s general policy for write-offs of receivables under follow-up is to write of such receivables that are proven to be uncollectible in legal follow-up
process within the instructions of Tax Procedure Law.
Expected Credit Loss:
Current Period
Prior Period
Stage 1
Stage 2
Stage 3
Stage 1
Stage 2
Stage 3
Provisions beginning of the period
Additional provisions within the period
4,191,349
7,822,416
12,735,339
15,898,604
3,094,850
8,564,927
14,371,889
6,611,081
12,402,374
3,744,299
6,839,036
4,134,573
Transfers within the period
Write-offs from Assets
Transfer to Stage 1
Transfer to Stage 2
Transfer to Stage 3
Currency Exchange Difference
(7,765,588)
(3,892,653)
(3,857,344)
(2,855,083)
(2,394,649)
(2,249,174)
492,459
(237,419)
(57,539)
273,111
(475,851)
312,730
(1,407,522)
754,643
(5,613,004)
(16,608
(75,311)
1,465,061
361,818
506,839
(647,781)
(26,272)
374,497
(498,512)
774,317
(1,334,981)
785,201
(2,013,743)
(8,327)
(126,536)
1,361,253
428,669
Provisions at the end of the period
4,718,789
14,637,767
20,565,590
4,191,349
12,735,339
15,898,604
g.
Financial Assets Measured at Amortized Cost:
g.1. Financial Assets Measured at Amortized Cost given as collateral or blocked:
Financial assets measured at Amortized cost given as collateral or blocked amount to TL 61,281,906 as at December 31, 2022 (December 31, 2021: TL
11,735,769).
g.2.
Financial Assets Measured at Amortized Cost subject to repurchase agreements:
Financial assets measured at Amortized cost, which are subject to repurchase agreements amount to TL 7,166,511 at December 31, 2022 (December
31, 2021: TL 17,843,004).
g.3.
Information on government securities measured at Amortized cost:
Government Bonds
Treasury Bills
Other Public Debt Securities
Total
Current Period
Prior Period
100,256,173
47,975,957
100,256,173
47,975,957
g.4. Information on financial assets measured at amortized cost:
f.10.5. Information on interest accruals, valuation differences and related provisions calculated for non-performing loans:
Current Period
Prior Period
Current Period (Net)
Interest accruals and valuation differences
Provisions (-)
Prior Period (Net)
Interest accruals and valuation differences
Provisions (-)
Group III
Loans with Limited
Collectability
Group IV
Loans with Doubtful
Collectability
Group V
Uncollectible Loans
80,448
157,677
77,229
107,756
210,639
102,883
353,634
1,025,286
671,652
424,694
841,748
417,054
251,539
1,519,085
1,267,546
392,732
1,473,886
1,081,154
f.10.6. Outline of the liquidation policy for uncollectible loans and other receivables:
In order to ensure the liquidation of non-performing loans, all possibilities evaluated to ensure maximum collection according to the legislation. First
of all, administrative initiatives are taken to deal with the borrower. Collection through legal proceedings used if there is no possibility of collection and
configuration with the interviews for other receivables.
Our receivables that cannot be collected through administrative and legal initiatives can be written off from the assets within the framework of portfolio-
based receivables sales or write-offs, by fulfilling the requirements of the Tax Procedure Law.
f.10.7. Explanations on write-off policy:
Receivables classified as non-performing loans are collected primarily within the framework of administrative contacts with the debtors, and if no result
is obtained, through legal means. In this context, if our uncollected receivables are deleted from assets, one of the methods of destruction, receivable
sale and deregistration can be applied.
In the Bank's write-off policy within the framework following the amendment made in Article 53 of the Banking Law with the Law on Income Tax and
amending Certain Laws No. 19.07.2019/7186, along with the "Classification of Loans and the Procedures and Principles for the Reserves to be Allocated
for Them" published in the Official Gazette No. 27.11.2019 / 30961, the following statements are issued:
Debt Securities
Quoted on a Stock Exchange
Not Quoted (1)
Impairment Losses (-)
Total
106,956,161
96,996,697
9,959,464
106,956,161
(1) Indicates unlisted debt securities, and debt securities that have not been traded at the end of the related periods while they are listed.
g.5. Movement of financial assets measured at amortized cost within the year:
Current Period
Prior Period
Beginning Balance
Foreign Exchange Differences Arising on
Monetary Assets
Purchases During the Year
Transfers
Disposals through Sales and Redemption
Impairment Losses (-)
Valuation Effect
Balance at the End of the Period
51,545,328
3,782,273
60,382,102
2,022,376
(21,574,387)
10,798,469
106,956,161
51,545,328
48,798,039
2,747,289
51,545,328
45,604,603
3,677,166
16,224,952
(16,481,168)
2,519,775
51,545,328
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390 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 391
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Expected credit loss for financial assets measured at amortised cost:
Current Period
Prior Period
Stage 1
Stage 2
Stage 3
Stage 1
Stage 2
Stage 3
Provisions beginning of the period
Additional provisions within the period
Transfers within the period
Write-offs from Assets
Transfer to Stage 1
Transfer to Stage 2
Transfer to Stage 3
28,994
61,491
(23,194)
Currency Exchange Difference
Provisions at the end of the period
1,379
68,670
h. Information on Associates (Net):
17,755
21,565
(11,283)
957
28,994
As per the “Communiqué on Preparation of Consolidated Financial Statements of Banks”, credit institutions or financial institutions associates are
included In the scope of consolidated financial statements. Within this context, credit institutions and financial associates are accounted in the
consolidated financial statements according to TAS 28 - Investments in Associates and Joint Ventures”.
h.1. Information on credit institution or financial institution associates that are not accounted by the equity method: None.
h.2. Information on credit institution or financial institution associates that are accounted by the equity method:
Title
Address (City/ Country)
Arap-Türk Bankası A.Ş.
İstanbul/Turkey
Information on financial statements of associates in the above order:
Bank’s Share Percentage-If
Different. Voting Percentage (%)
20.58
Bank’s Risk Group Share
Percentage (%)
79.42
Total Assets
Shareholders’
Equity
Total Tangible
Assets
Interest
Income (1)
Securities
Income
Current Period
Profit/Loss
Prior Period
Profit/Loss
Fair Value
12,228,874
1,872,216
584,891
708,973
63
215,338
163,288
(1) Includes interest income on securities.
h.3. Movement of investments in consolidated associates (1):
Beginning Balance
Movements during the period
Purchases
Bonus shares acquired
Dividends received from the current year profit
Sales
Revaluation Increase (2)
Impairment
Balance at the end of the period
Capital commitments
Contribution in equity at the end of the period (%)
105,029
385,225
38,022
280,196
(1) Includes the information related to associate which is a credit institution in which the Bank has direct shares.
(2) Includes the equity method accounting differences.
h.4. Sectoral information on consolidated associates and the related carrying amounts (1):
Banks
Insurance Companies
Factoring Companies
Leasing Companies
Finance Companies
Other Financial Participations
Total
Current Period
385,225
Prior Period
280,196
385,225
280,196
(1) Includes the information related to associate which is a credit institution in which the Bank has direct shares.
h.5.
h.6.
h.7.
Consolidated associates traded on a stock exchange: None.
Consolidated associates disposed of in the current period: None.
Consolidated associates acquired in the current period: None.
h.8. Other issues related to associates:
The accounting method for non-financial subsidiaries, associates and jointly controlled associates is changed in accordance with TAS 27 “Individual Financial
Statements” to the equity method introduced in TAS 28. The effects of these changes are given in Section Three III.2 numbered footnotes in detail.
i.
Information on subsidiaries (Net):
As per the “Communiqué on Preparation of Consolidated Financial Statements of Banks”, the Bank includes credit institutions or financial institutions subsidiaries in
the scope of consolidated financial statements.:
i.1.
Information on the equity of major subsidiaries:
Türkiye Sınai Kalkınma
Bankası A.Ş.
Sigorta / Reasürans
Şirketleri
İş Gayrimenkul
Yatırım Ortaklığı A.Ş
İşbank AG
İş Yatırım Menkul
Değerler A.Ş
İş Finansal
Kiralama A.Ş
COMMON EQUITY TIER I CAPITAL
Common Equity Tier I Capital Before
Deductions
Deductions from Common Equity
Tier I Capital (-)
Total Common Equity Tier I Capital
ADDITIONAL TIER I CAPITAL
Additional Tier I Capital before
Deductions
Deductions from Additional Tier I
Capital (-)
Total Capital
TIER II CAPITAL
Tier II Capital Before Deductions
Deduction from Tier II Capital (-)
Total Additional Tier II Capital
Total Capital and Tier II Capital
Deductions from Total Capital and
Additional Tier I Capital (-)
CAPITAL
13,192,070
14,607,148
13,925,551
7,526,750
6,815,919
3,432,832
497,007
461,922
7,969
160,365
111,128
16,363
12,695,063
14,145,226
13,917,582 7,366,385
6,704,791
3,416,469
12,695,063
14,145,226
13,917,582 7,366,385
6,704,791
3,416,469
4,587,995
4,587,995
17,283,058
14,145,226
13,917,582 7,366,385
6,704,791
3,416,469
17,283,058
14,145,226
13,917,582 7,366,385
6,704,791
3,416,469
1
2
3
4
5
6
7
8
9
10
11
12
13
Anadolu Anonim Türk Sigorta Şirketi
Anadolu Hayat Emeklilik A.Ş.
Efes Varlık Yönetim A.Ş.
İş Faktoring A.Ş.
İş Finansal Kiralama A.Ş.
İş Gayrimenkul Yatırım Ortaklığı A.Ş.
İş Girişim Sermayesi Yatırım Ortaklığı A.Ş.
İş Portföy Yönetimi A.Ş.
İş Yatırım Menkul Değerler A.Ş.
İş Yatırım Ortaklığı A.Ş.
İşbank AG
JSC İşbank
JSC Isbank Georgia
14 Maxis Girişim Sermayesi Portföy Yönetimi A.Ş.
15 Maxis Investments Ltd.
16 Milli Reasürans T.A.Ş.
17 Moka Ödeme ve Elektronik Para Kuruluşu A.Ş.
18
19
20
21
TSKB Gayrimenkul Yatırım Ortaklığı A.Ş.
Türkiye Sınai Kalkınma Bankası A.Ş.
Yatırım Finansman Menkul Değerler A.Ş.
Yatırım Varlık Kiralama A.Ş.
Istanbul/Turkey
Istanbul/Turkey
Istanbul/Turkey
Istanbul/Turkey
Istanbul/Turkey
Istanbul/Turkey
Istanbul/Turkey
Istanbul/Turkey
Istanbul/Turkey
Istanbul/Turkey
Frankfurt/Germany
Moscow/Russia
Tbilisi/Georgia
Istanbul/Turkey
London/England
Istanbul/Turkey
Istanbul/Turkey
Istanbul/Turkey
Istanbul/Turkey
Istanbul/Turkey
Istanbul/Turkey
(1) Indirect share of the Group is considered as the Parent Bank’s share percentage.
50.21
74.81
66.28
46.43
45.33
60.47
35.37
67.47
67.98
24.97
100.00
100.00
100.00
67.98
67.98
87.60
100.00
44.78
50.46
48.90
48.90
49.79
25.19
33.72
53.57
54.67
39.53
64.63
32.53
32.02
75.03
0.00
0.00
0.00
32.02
32.02
12.40
0.00
55.22
49.54
51.10
51.10
Current Period
280,196
Prior Period
242,174
i.2.
i.3.
Information on unconsolidated subsidiaries: None.
Information on consolidated subsidiaries:
Title
Address (City/ Country)
Bank’s Share
Percentage-If Different.
Voting Rights (%) (1)
Bank’s Risk Group
Share Percentage (%)
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392 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 393
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Financial statement information related to consolidated subsidiaries in the above order:
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
Interest
Income (1)
Securities
Income
Current
Period
Profit/Loss
Prior Period
Profit/Loss
Fair Value
(2)
Additional
Shareholders’
Equity
Required
970,550
2,164,228
1,323,552
589,835
7,915,000
1,038,678
513,911
1,391,752
699,988
9,848,720
Total Assets
Shareholders’
Equity
29,414,397
4,756,818
90,659,179
3,466,207
214,053
176,588
16,429,140
1,420,458
Total
Tangible
Assets
711,866
215,301
10,539
15,331
143,097
1,691,251
36,330,079
3,744,045
60,515
3,330,338
17,417,219
13,920,236
13,959,708
1,011,126
1,007,356
508,178
451,600
3,412
8,202
35,809,603
7,267,688
206,268
320,451
313,600
33,318,257
7,920,657
4,525,552
1,633,192
2,917,655
29,360
1,063,857
828,210
18,949
134,575
897
346,362
100,257
57,507
7,111
4,923
44,469
10,362
41,880
76,171
24,973
878,024
408,306
166,509
592
4,255
871
9,872
19,602
51,395
445,386
826,766
23,631
121,372
310,063
5,605,530
277,409
44,469
1,329,920
10,286,429
4,086
54,637
732,001
224,749
11,976
97,016
1,305,000
1,756,373
4,529,607
1,233,477
22,215,545
828,532
51,616
1,384
80,245
323,549
478,226
82,366
8,969
31,829
50,811
143,158
12,739
28,165
4,691
12,484
12,400,448
5,055,936
2,449,885
518,181
222,160
888,620
548,966
468,170
46,570
6,047
1,817,662
1,809,469
1,780,819
4,024
3,624
2,351
2,143
1,069,466
124,879
3,396,900
117,621,660
12,992,456
1,983,415
10,374,234
110,483
4,105,739
1,097,309
12,280,800
3,706,023
346,228
11,486
267,574
87,029
115,122
66,201
178,642
303
66
49
(1) Includes interest income on securities.
(2) Fair value is the companies’ market value.
i.4. Movement of investments in subsidiaries (1):
Balance at the Beginning of the Period
Movements in the Period
Purchases (2)
Bonus Shares Acquired
Dividends Received from the Current Year Profit
Sales
Revaluation Surplus/Deficit (3)
Impairment
Balance at the End of the Period
Capital Commitments
Contribution in equity at the end of the period (%)
Current Period
Prior Period
17,613,057
2,714,715
17,045,598
37,373,370
13,004,921
135,635
4,472,501
17,613,057
(1) Reveals the information related to companies subject to consolidation in which Bank directly owns share.
(2) The amount in the current period is due to the capital increase of İşbank AG and the amount in the prior period is due to the purchasing shares of Moka Ödeme ve Elektronik
Para Kuruluşu A.Ş. by cash and Türkiye Sınai Kalkınma Bankası A.Ş., İş Gayrimenkul Yatırım Ortaklığı A.Ş. and İş Yatırım Menkul Değerler A.Ş. shares followed in the Financial
Assets at Fair Value Through Profit or Loss account is classified under subsidiaries along with the capital increase.
(3) Includes accounting differences by equity method.
i.5. Sectoral information on consolidated subsidiaries and the related carrying amounts (1):
Banks
Insurance Companies
Factoring Companies
Leasing Companies
Finance Companies
Other Financial Subsidiaries
Total
Current Period
Prior Period
16,800,054
7,310,823
937,316
12,325,177
37,373,370
8,036,340
4,353,568
544,978
4,678,171
17,613,057
(1) Reveals the information related to companies subject to consolidation in which Bank directly owns share.
i.6. Consolidated subsidiaries traded on stock exchange (1):
Traded on domestic stock exchanges
Traded on foreign stock exchanges
Current Period
Prior Period
22,198,019
10,063,540
(1) Reveals the information related to companies subject to consolidation in which Bank directly owns share.
i.7.
i.8.
i.9.
Consolidated subsidiaries disposed of in the current period: None
Subsidiaries acquired in the current period: None
Other issues on subsidiaries:
As explained in Note III.2 of Section Three, non-financial subsidiaries, associates and jointly controlled associates are accounted by using the equity
method defined in TAS 28 “Investments in Subsidiaries and Associates” within the scope of TAS 27 “Individual Financial Statements”.
j.
Information on jointly controlled entities (Net):
As per the “Communiqué on Preparation of Consolidated Financial Statements of Banks”, jointly controlled entities as credit institutions or financial
institutions are included in the scope of consolidated financial statements. There are no jointly controlled entities which are excluded in the scope of the
consolidation.
On the other hand, as explained in Note III.2 of Section Three, non-financial subsidiaries, associates and jointly controlled associates are accounted by
using the equity method defined in TAS 28 “Investments in Subsidiaries and Associates” within the scope of TAS 27 “Individual Financial Statements”.
k.
k.1.
Information regarding finance lease receivables (Net):
Presentation of finance lease receivables according to their remaining maturities:
Less than 1 Year
1-4 Years
More than 4 Years
Total
Current Period
Prior Period
Gross
8,698,663
10,780,717
1,271,472
Net
7,065,854
9,443,616
1,133,105
Gross
5,518,419
7,264,644
701,434
Net
4,652,503
6,428,916
622,103
20,750,852
17,642,575
13,484,497
11,703,522
k.2.
Information regarding net investments made on finance lease:
Gross Finance Lease Investment
Unearned Finance Revenue from Finance Lease (-)
Net Finance Lease Investment
Current Period
Prior Period
20,750,852
3,108,277
17,642,575
13,484,497
1,780,975
11,703,522
k.3. Presentation of operating lease receivables according to their remaining maturities:
As at December 31, 2022 the remaining maturities of the Group's operating lease receivable is less than 1 year the total amount is TL 35,795 (December
31, 2021; TL 23,537).
l.
Positive differences table for hedging derivative financial assets:
Part of Derivative Financial Assets at Fair Value Through Profit Loss
(1)
Current Period
Prior Period
Net
Gross
Net
Gross
Hedging Derivative Financial Assets
Hedging Cash Flow
Protection from Net Investment Risk Abroad
Total
387,926
256,505
387,926
256,505
(1) Includes information on derivative financial assets for hedging purposes classified under derivative financial assets.
Explanations on hedging derivative financial assets:
Derivative Financial Liabilities at Fair Value through
Profit/Loss
Interest Rate Swap Transactions
FC
TL
Currency Swap Transactions
FC
TL
Contract
Sum
15,582,944
15,582,944
Current Period
Prior Period
Assets
Liability
Contract
Sum
Assets
Liabilty
134,010
19,085,248
134,010
19,085,248
208,148
208,148
10,914,093
10,914,093
387,926
387,926
7,926,855
7,926,855
48,357
48,357
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Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Information on fair value hedge accounting is given below.
Current Period:
Hedging Instrument
Hedging Item
Risk
Exposure
Fair Value
Difference
of Hedging
Assets (1)
Net fair value of hedging
instrument (1)
Assets
Liabilities
Income statement
effect (profit
/ loss from
derivative financial
transactions)
Interest Rate Swap
Transactions
Interest Rate Swap
Transactions
Cross Currency Swap
Transactions
Fixed Interest rate Eurobond and
Greenbond
Interest Risk
8,201
Fixed Rate Loans Used
Interest Risk
93,402
(3,496)
(94,182)
Fixed Interest Rate Eurobond
Interest Risk
(76,245)
80,846
4,705
(780)
4,601
(1) The fair value of the protected assets and the hedged assets subject to hedge accounting is shown as the net market value excluding the credit risk and the accumulated interest.
Prior Period:
Hedging Instrument
Hedging Item
Risk
Exposure
Fair Value
Difference
of Hedging
Assets (1)
Net fair value of hedging
instrument (1)
Assets
Liabilities
Income statement
effect (profit
/ loss from
derivative financial
transactions)
Interest Rate Swap
Transactions
Interest Rate Swap
Transactions
Fixed Interest rate Eurobond and
Greenbond
Interest Risk
(111,338)
117,468
Fixed Rate Loans Used
Interest Risk
(24,900)
24,016
6,130
(884)
Cross Currency Swap
Transactions
(1) The fair value of the protected assets and the hedged assets subject to hedge accounting is shown as the net market value excluding the credit risk and the accumulated interest.
Fixed Interest Rate Eurobond
Interest Risk
(72,869)
73,489
620
m.
Information on Tangible Assets:
Current Period
Real Estate
Right-to-Use
Assets
Buildings
Under
Construction
Vehicles Other MDV
Total
Previous Period
Cost
8,903,796
2,520,198
292,153
49,778
3,915,335
15,681,260
Accumulated Depreciation
(26,723)
(1,398,981)
(31,123)
(2,817,409)
(4,274,236)
Net Book Value
Current Period
Net Book Value at the Beginning of Period
Current Period Changes (Net) (1)
Depreciation Fee
Provision for Impairment (Net)
Foreign Exchane Differences (Net) (1)
End of Term Cost
8,877,073
1,121,217
292,153
18,655
1,097,926
11,407,024
8,877,073
11,904,498
1,121,217
811,955
(157,735)
(488,609)
292,153
19,268
18,655
1,097,926
11,407,024
26,287
1,258,930
14,020,938
(8,418)
(481,401)
(1,136,163)
28,990
21,792
59,664
1,077
74,796
28,990
157,329
20,694,380
3,502,559
311,421
78,021
5,160,629
29,747,010
Accumulated Depreciaton at the End of the Period
(19,762)
(1,998,332)
(40,420)
(3,210,378)
(5,268,892)
Net Book Value at the End of the Period
20,674,618
1,504,227
311,421
37,601
1,950,251
24,478,118
(1) Includes the movements in cost value and accumulated depreciation items.
k.
Information on Intangible Assets:
Explanation regarding consolidation goodwill that is included in intangible assets is given in Section Three under the caption of “XII. Explanations on
Goodwill and Other Intangible Assets.” The table consisting movements of other intangible assets are presented below.
Current Period
Prior Period
Net Book Value at the Beginning of the Period
Change During the Period (Net)(1)
Depreciation
Impairment
Currency Translation Differences (1)
Cost at Period End
Accumulated Depreciation at Period End
Net Book Value at the End of the Period
(1) The balance includes the movements in cost and accumulated depreciation items
2,154,031
2,756,745
(912,870)
53,913
8,199,345
(4,147,526)
4,051,819
1,618,014
921,544
(453,413)
67,886
5,284,771
(3,130,740)
2,154,031
l. Information on investment property:
Investment properties are properties that the Group holds to earn rentals. Explanations on these subjects are given in Section Three Note XIV. Total rental
income obtained from investment properties during the period is TL 275,199 (December 31, 2021: TL 150,519).
Net Book Value at the Beginning of the Period
Change During the Period (Net) (1)
Revaluations Surplus/Deficit
Net Book Value at the End of the Period
n. Information on deferred tax asset:
Current Period
Prior Period
4,601,916
190,204
6,528,070
11,320,190
3,649,631
51,414
900,871
4,601,916
As of December 31, 2021, the Parent Bank and the other consolidated Group companies has deferred tax asset amounting to TL 3,118,976. Such
deferred tax asset is calculated based on the temporary differences between the book value of assets and liabilities and their tax basis measured as
per the prevailing tax regulation. When the items comprising the temporary differences are followed under equity, the related tax asset/liability is directly
recognized under equity items.
Tangible Assets Base Differences
Provisions (1)
Finance Lease Income Accruals
Valuation of Financial Assets
Other
Net Deferred Tax Asset
Current Period
Prior Period
59,702
(1,292,150)
66,033
259,564
(67,259)
(974,110)
743,080
(6,041,695)
32,401
1,946,829
200,409
(3,118,976)
(1) Comprised of employee termination benefits, actual and technical deficits of the pension fund, insurance technical provisions, the provisions for credit card bonus points,
expected credit loss for Stage 1 and Stage 2 loans and other provisions.
n.
Information on assets held for sale and discontinued operations:
Net Balance at the Beginning of the Period
Change during the periods (Net) (1)
Amortized Cost
Foreign Currency Difference
Net Book Value at the End of the Period
Current Period
Prior Period
910,871
708,104
(7,042)
7,061
1,618,994
1,302,608
(399,379)
7,642
910,871
(1) The TL 1,249,492 portion of the change in the current period relates to the transfer of the 12.28% share in General Energy PLC's capital to the Bank as an offset to the receivable.
Investment in a special purpose company whose details be given in Section Five footnote I.b.3 is classified within the scope of “TFRS-5 Assets Held for
Sale and Discontinued Operations”. In 2019 the Bank’s and Türkiye Sınai Kalkınma Bankası A.Ş.’s shares’ nominal values in company’s capital increased
from TL 6 to TL 461,833 and TL 1 to TL 64,403 respectively. As announced on KAP at the date of 31.03.2022, the sale and transfer of these shares to
Türkiye Varlık Fonu has been completed and the provision for a decrease in value has been reserved for the entire investment classified under “TFRS
5- Fixed Assets Held for Sale and Discontinued Operations”. The sale and transfer to TVF has been completed, and a provision for impairment has been
set aside for the entire investment classified within the framework of "TFRS 5- Non-current Assets Held for Sale and Discontinued Operations". Shares
amounting to TL 526,236, which were tracked under the Assets Held for Sale and Discontinued Operations item and all of which were reserved for
impairment, were written off together with the impairment provision within the scope of the registration of the liquidation of the company in the Trade
Registry Gazette dated 28.12.2022 and numbered 10735. .
The other assets classified as “Fixed Assets Held for Sale” mostly consist of real estates. Announcements about the real estates subject to sale are made
by using newspaper advertisements and similar media. Additionally, the Parent Bank’s real estates subject to sale are announced on the Bank’s web site.
The Group has no discontinued operations.
o. Information on other assets of the group:
Other assets item does not exceed 10% of the balance sheet total.
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Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
II.
a.
DISCLOSURES AND FOOTNOTES ON CONSOLIDATED LIABILITIES
Information on Deposits:
a.1.
The maturity structure of deposits:
Current Period
Demand
7 Days
Notice
Up to 1
Month
1-3 Months
3-6 Months
6 Months
to 1 Year
1 Year and
Over
Accumulated
Deposits
Total
Savings Deposits
52,201,388
13,192,421
57,543,852
89,132,133
5,629,299
4,469,259
4453
222,172,805
Foreign Currency
Deposits
259,519,298
44,938,425 142,216,242
14,994,589
6,031,447 21,436,452
1,332
489,137,785
Residents in Turkey
217,729,950
41,659,997 120,084,874
11,660,457
2,295,737
4,755,227
1,312
398,187,554
Residents Abroad
41,789,348
3,278,428
22,131,368
3,334,132
3,735,710
16,681,225
20
90,950,231
Public Sector Deposits
948,455
41,996
218,359
2,352
412
5
Commercial Deposits
54,943,461
49,548,292
11,835,853
19,297,798
8,470,551
4,974,482
Other Institutions
Deposits
Precious Metals
Deposits
933,998
1,585,467
2,555,476
126,370
11,971
30,133
61,964,641
10,925
3,864,020
221,532
8,091,907
339,773
Interbank Deposits
1,192,084
2,933,032
2,021,365
56,837
1,398,107
3,705,688
The Central Bank
of Turkey
Domestic Banks
Foreign Banks
Participation Banks
756
37,492
1,153,256
580
2,297,918
322,705
400,126
635,114
1,698,660
56,837
997,981
3,705,688
1,211,579
149,070,437
5,243,415
74,492,798
11,307,113
756
3,058,241
8,247,536
580
Other
Total
431,703,325
112,250,558 220,255,167
123,831,611 29,633,694 34,955,792
5,785 952,635,932
Prior Period
Demand
7 Days
Notice
Up to 1
Month
1-3 Months 3-6 Months
6 Months
to 1 Year
1 Year and
Over
Accumulated
Deposits
Total
Savings Deposits
29,130,181
10,101,438
62,338,966
8,091,893
879,420
1,026,512
6,422
111,574,832
Foreign Currency
Deposits
195,521,622
34,766,109 129,130,825
8,364,528
6,984,141
18,549,447
2,293
393,318,965
Residents in Turkey
171,143,280
32,092,855
111,457,042
5,338,216
1,907,736
4,904,765
1,517
326,845,411
Residents Abroad
24,378,342
2,673,254
17,673,783
3,026,312
5,076,405
13,644,682
776
66,473,554
Public Sector
Deposits
1,205,680
11,796
139,914
1,073
374
200
Commercial Deposits
18,091,217
16,649,887
11,071,146
173,276
515,975
28,850
Other Institutions
Deposits
Precious Metals
Deposits
602,088
571,697
3,160,538
40,352
2,411
51,875
46,013,605
1,055,562
150,880
6,508,325
311,651
Interbank Deposits
1,302,757
555,375
1,133,496
59
848,077
2,587,270
The Central Bank
of Turkey
Domestic Banks
Foreign Banks
Participation Banks
480
288,796
1,013,416
65
450,260
105,115
538,289
595,207
148,477
59
699,600
2,587,270
1,359,037
46,530,351
4,428,961
54,040,023
6,427,034
480
1,425,822
5,000,667
65
Other
Total
291,867,150
62,656,302 208,030,447
16,822,061 15,738,723 22,555,805
8,715 617,679,203
Total
Within the framework of the ""Communiqué on Supporting the Transformation into Turkish Lira Deposits and Participation Accounts" published in the Official
Gazette dated 24.02.2022 and numbered 31760 and the CBRT's communiques numbered 2021/14, 2021/16, 2022/7 and 2022/11, Parent Bank offers its
customers a TL deposit product with exchange rate protection. As of 31.12.2022, the amount of the foreign exchange-protected deposits opened within this
scope is TL 129,809,134 (31.12.2021: 6,116,412 TL).
a.2. Savings deposits which are under the guarantee of Savings Deposits Insurance Fund exceeding the insurance limit:
Savings Deposits
Savings Deposits
Foreign Currency Savings Deposits
Other Deposits in the Form of Savings Deposits
Foreign Branches’ Deposits Under Foreign Authorities’
Insurance
Off-shore Banking Regions’ Deposits Under Foreign
Authorities Insurance
Under the Guarantee of Savings Deposits
Insurance Fund
Exceeding the Limit of Deposit Insurance
Fund
Current Period (1)
Prior Period
Current Period
Prior Period
98,271,661
76,393,000
26,836,200
54,291,725
58,931,256
19,430,372
122,016,357
221,588,222
41,995,951
56,062,849
175,476,819
31,613,866
21,388,501
14,734,281
4,438,625
4,059,511
(1) With the Official Gazette dated 27.08.2022 and numbered 31936, a change was made in the determination of the deposits subject to insurance, and all deposits except those
belonging to official institutions and credit and financial institutions were covered by insurance. Within this framework, there are commercial deposits amounting to TL 21,845,052
within the scope of the insurance, and the related amount is not shown in the table.
a.3. Savings deposits which are not under the guarantee of deposit insurance fund:
Foreign Branches’ Saving Deposits and Other Accounts
Deposits and Other Accounts held by Main Shareholders and their Relatives
Deposits and Other Accounts of the Chairperson and Members of Board of Directors,
Chief Executive Officer, Senior Executive Officers and their Relatives
Deposits and Other Accounts Covered by Assets Generated Through the Offenses
Mentioned in Article 282 of the Turkish Criminal Code Numbered 5237 and Dated 26
September 2004
Deposits in the Banks to be Engaged Exclusively in Off-shore Banking in Turkey
b. Negative Differences on Derivative Financial Liabilities Held for Trading:
Current Period
Prior Period
4,438,625
4,059,511
39,447
29,224
Derivative Financial Liabilities at Fair Value
through Profit/Loss (1)
Forward Transactions
Swap Transactions
Current Period
Prior Period
TL
115,054
2,910,812
FC
601,553
6,050,298
TL
2,282,720
4,682,562
Futures
Options
Other
Total
34,799
244,575
131,914
3,060,665
6,896,426
7,097,196
FC
265,681
6,127,648
461,757
126,245
6,981,331
(1) Includes information related to derivative financial liabilities held for trading and clsassified under derivative financial liabilities. Information on derivative financial liabilities for
hedging purposes is disclosed in Note II.g of Section Five.
c.
Banks and Other Financial Institutions:
c.1. Information on banks and other financial institutions:
Funds borrowed from the CBRT
Domestic banks and institutions
Foreign banks, institutions and funds
Current Period
Prior Period
TL
FC
TL
FC
9,536,923
2,564,571
12,101,494
8,805,823
135,074,282
143,880,105
3,736,112
2,283,386
6,019,498
9,586,758
113,317,427
122,904,185
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Türkiye İş Bankası A.Ş.
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
c.2. Maturity analysis of funds borrowed:
e.
Concentration of the liabilities of the Group:
Short-term
Medium and Long-term
Total
c.3. Information on funds borrowed:
Current Period
Prior Period
TL
9,704,698
2,396,796
12,101,494
FC
8,339,020
135,541,085
143,880,105
TL
4,072,916
1,946,582
6,019,498
FC
8,797,761
114,106,424
122,904,185
Information on funds received through syndicated loans and securitization deals, which take a significant place among funds borrowed, are given below.
Syndication loans:
Date of Use
June 2022
July 2022
Funds Borrowed
USD 257,000,000 + EUR 482,960,000
USD 17,500,000 + EUR 90,000,000
November 2022
USD 191,000,000 + EUR 330,500,000
Maturity
1 Year
1 Year
1 Year
Securitization deals:
The Parent Bank obtained funds by putting on securitization deals all its claims and receivables based on diversified payment rights in USD, EUR and
GBP through its consolidated structured entity TIB Diversified Payment Rights Finance Company (TIB) which was established in abroad. The Parent
Bank monitors securitization credits under the “Borrowings” on its financial statements as per its nature.
Information on funds received through securitization is given below.
Date
June 2012
December 2013
December 2014
March 2015
October 2015
October 2016
December 2016
December 2017
December 2017
August 2022
Amount
Final Maturity
Remaining Debt Amount as at
December 31, 2021
EUR 125,000,000
EUR 50,000,000
USD 220,000,000
USD 15,000,000
USD 221,200,000
USD 55,000,000
USD 158,800,000
USD 55,000,000
USD 125,000,000
USD 227,000,000
12 year
12 year
14 year
15 year
10 year
12 year
10-13 year
7 year
9 year
5 year
EUR 21,875,000
EUR 15,000,000
USD 120,000,000
USD 13,593,750
USD 76,037,500
USD 32,195,112
USD 77,648,334
USD 22,000,000
USD 101,190,476
USD 227,000,000
Other Transactions:
The Parent Bank, the financing transaction amounting to USD 500 million, with a maturity of 10 years, obtained within the scope of the Diversified
Payment Rights (DPR) securitization programme, which had been disclosed on August 2014, has been increased to USD 600 million by an additional
funding of USD 100 million with the identical maturity profile on September 2017.
d. Information on Debt Securities Issued (Net):
Bills
Asset backed security
Bonds
Total
Current Period
Prior Period
TL
10,463,791
164,426
895,529
11,523,746
FC
TL
FC
46,820,814
46,820,814
5,999,193
757,078
2,028,706
8,784,977
39,292,335
39,292,335
Group’s liabilities 56% are comprised of deposits, 9% are comprised of funds borrowed, 5% are comprised subordinated debt and marketable securities
issued and 3% are comprised of debt from money markets. Deposits are distributed among a large variety of customers with different characteristics.
The borrowings, on the other hand, are comprised of various funds obtained from financial institutions through syndication, securitization, post-financing
and money market operations.
f.
Information on Other Liabilities:
Other liabilities do not exceed 10% of the balance sheet total.
g. Information on Lease Payables (Net):
Less than 1 year
1-4 years
More than 4 years
Total
Current Period
Prior Period
Gross
Net
Gross
Net
54,887
546,849
1,857,601
2,459,337
29,467
390,839
1,222,747
1,643,053
54,978
263,475
1,501,399
1,819,852
38,505
188,386
1,012,823
1,239,714
h.
Negative differences related to derivative financial instruments for hedging purposes:
Part of Derivative Financial Liabilities at Fair
Value Through Profit Loss (1)
Current Period
Prior Period
Gross
Net
Gross
Net
Fair Value Hedge Purpose
Cash Flow Hedges
Net Investment Hedge Abroad
Total
134,010
134,010
(1) Includes the negative differences related to derivative financial assets for hedging purposes classified under derivative financial assets.
The transactional details for the hedging derivative financial instruments are disclosed in Note I.l of Section Five.
i.
i.1.
Information on Provisions:
Reserves for employee benefits:
According to the related regulation and the collective bargaining agreements, the Parent Bank is obliged to pay employee termination benefits to
employees who retire, die, quit for their military service obligations, who have been dismissed as defined in the related regulation or to the female
employees who have voluntarily quit within one year after the date of their marriage. In accordance with the related regulations, the amount of employee
termination benefits is TL 15,371.40 (exact TL amount as of December 31, 2022), which is one-month salary for each service year and cannot exceed
the base salary ceiling for employee termination benefits. A provision for severance pay to allocate that employees need to be paid upon retirement is
calculated by estimating the present value of probable amount. A provision for severance pay to allocate that employees need to be paid upon retirement
is TL 5,605,220 as of December 31, 2022 (December 31, 2020; TL 2,424,212).
Main actuarial assumptions used in calculation of severance pay liability are as follows:
ੵ In the calculation, the discount rate is 22.45%, the inflation rate is 19.80%, and the real wage increase rate is 2%.
ੵ In the calculation, the ceiling of 15,371.40 TL (full TL amount) valid as of 31.12.2022 was taken as basis.
ੵ Retirement age is taken into account as the earliest age at which individuals can retire.
ੵ CSO 1980 mortality table is used for probability of death for women and men.
The movements related to provision for employee termination benefits are given below:
Present value of defined benefit obligation at the beginning of the period
Current Service Cost
Interest Cost
Benefits paid
Loss/(Gain) due to Settlements / Reductions / Terminations
Prior Year Service Cost
Actuarial loss/(gain)
Defined benefit obligation at the end of the period
Current Period
Prior Period
2,424,212
194,109
452,379
(195,616)
9,837
1,941
2,718,358
5,605,220
1,501,616
110,009
185,885
(116,836)
11,097
732,441
2,424,212
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Türkiye İş Bankası A.Ş.
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
In addition to the retirement pay liability, the Bank and the Group companies included in the consolidation reserve provisions for unused vacation. As of
December 31, 2022, the unused vacation provision amount is TL 288,519 (December 31, 2021: TL 152,219).
i.2.
Provisions for exchange losses in the principal amount of foreign currency indexed loans:
Since foreign currency indexed loans are followed based on the rates on the lending date, the Parent Bank incurs a loss if the exchange rates decrease
and makes profit if the exchange rate increases. As of December 31, 2022, and December 31, 2021 there is no provision amount for the currency
evaluation losses in the principal amount of foreign currency indexed loans.
i.3.
Specific provisions for non-cash loans, which are not indemnified and not converted into cash:
As of December 31, 2022, TL 618,580 provision (December 31, 2021: TL 1,215,914) is allocated for the non-cash loans of companies whose loans are
followed under non-performing loans accounts.
i.4.
Information on other provisions:
i.4.1.
Liabilities arising from retirement benefits:
Liabilities of pension funds founded as per the Social Security Act:
Within the scope of the explanations given in. Section Three Note XX.2, in the actuarial report which was prepared as of December 31, 2022 for Türkiye
İş Bankası A.Ş. Emekli Sandığı Vakfı (İşbank Pension Fund) by a licensed actuary, of which each Bank employee is a member, and which has been
established according to the provisional Article 20 of the Social Security Act numbered 506, the amount of actuarial and technical deficit stands at TL
8,379,741.According to the actuarial report as at December 31, 2022 of Milli Reasürans T.A.Ş. besides the Parent Bank, the amount of actuarial and
technical deficit was determined to be TL 235,267. There is a provision on financial statements to compensate the deficit in mentioned period, the
mentioned provision is preserved on current year financial statements as well. In the financial statements for the said period, there are as many provisions
as the said deficit amounts, and the said provision amount has been retained in the financial statements for the current period.
The above-mentioned actuarial audit, which was made in accordance with the principles of the related law, measures the cash value of the liability as of
December 31, 2022, in other words, it measures the amount to be paid to the Social Security Institution by the Parent Bank. Actuarial assumptions used
in the calculation are given below.
ੵ 9.8 % technical deficit interest rate is used.
ੵ 34.5 % total premium rate is used.
ੵ CSO 1980 woman/man mortality tables are used.
Below table shows the cash values of premium and salary payments of the Parent Bank as of December 31, 2021, taking the health expenses within the
Social Security Institution limits into account.
Net Present Value of Total Liabilities Other Than Health
Net Present Value of Long Term Insurance Line Premiums
Net Present Value of Total Liabilities Other Than Health
Net Present Value of Health Liabilities
Net Present Value of Health Premiums
Net Present Value of Health Liabilities
Pension Fund Assets
Amount of Actuarial and Technical Deficit
The assets of the pension fund are as follows:
Cash and Cash Equivalents
Securities Portfolio
Other
Total
Current Period
Prior Period
(30,350,164)
13,123,522
(17,226,642)
(2,986,675)
9,514,553
6,527,878
2,319,023
(8,379,741)
(15,810,869)
5,858,707
(9,952,162)
(1,873,541)
4,247,562
2,374,021
1,483,086
(6,095,055)
Current Period
Prior Period
1,240,842
742,714
335,467
2,319,023
984,609
439,018
59,459
1,483,086
Health benefits that are still being paid will be determined within the framework of the Social Security Institution legislation and related regulations with
the transfer.
i.4.2. Provision of credit cards and promotion of banking services applications: The Bank has recognized provisions amounting to TL 235,129 for the
amount which is recognized within the framework of credit card expenses of credit card customers or promotions for banking services as of December
31, 2022. (December 31, 2021: TL 108,873)
i.4.3. As mentioned public disclosures of the Bank on December 31, 2012 and December 19, 2013; an inspection has been made by the inspectors of
Tax Inspection Board to "Türkiye İş Bankası A.Ş. Mensupları Munzam Sosyal Güvenlik ve Yardımlaşma Sandığı Vakfı" ("İşbank Supplementary Pension
Fund"), which was founded as per the provisions of the Turkish Commercial and Civil Codes, regarding the payments that fulfill İşbank's liabilities within
the framework of the Articles of Foundation of the Pension Fund and the relevant legislation. As a result of this investigation, tax audit reports were
prepared for the years 2007, 2008, 2009, 2010, 2011 claiming that the aforementioned liabilities should be taxed in terms of wage base, thus, they
should be subject to withholding tax and stamp duty. According to this report, the total amount of tax and penalties notified to Bank was TL 74,353 for
2007 and 2008; and as of reporting date TL 151,899 for 2009, 2010 and 2011 and it was stated that the Bank applied to tax courts to cancel these tax
notifications and some of the court decisions were determined in favor of the Bank and some others were determined against the Bank.
In this context, for the finalized decisions of Regional Administrative Courts related to the years 2007 and 2008 against the Bank, the Bank applied to
the Constitutional Court. According to decisions made by Constitutional Court up to reporting date, there is no predictability in legal conformity for taxing
the Bank's contributions to the Pension Fund in terms of wage base and for this reason it was accepted that property right of the Bank has been violated
according to the 35th article of Constitution. The Court decided that the amount of tax, penalties and default interest which was paid by the Bank should
be paid back to the Bank as for compensation with its legal interest.
Besides of the Bank, an inspection was conducted by Tax Audit Committee Inspectors regarding to the contribution obligations mentioned above for
the period 2007-2011 on Munzam Sosyal Güvenlik ve Yardımlaşma Sandığı Vakfı Mensupları which is founded according to Turkish Commercial Law
and Civil Law, owned by “Türkiye Sınai Kalkınma Bankası A.Ş”. “Milli Reasürans T.A.Ş”, and Anadolu Anonim Türk Sigorta Şirketi. As a result of the issued
report that companies a total of TL 33 million (exact amount) tax penalty notices were notified. Assessments made on the subject by the company’s
application in accordance with the legislation, which was suspended for Tax Administration concluded that the lack of legal basis of assessment and
said assessment were filed in court against the various tax. A number of cases concluded in favor of the Bank; another part of lawsuits concluded
against the Bank.
In the last decision of the constitutional court numbered 2016/2400 regarding the legal proceedings initiated upon the conclusion of the lawsuits
amounting to TL 61,060 for the 20 periods in 2012 and 2013 against the bank; it was accepted that the predictability criterion was realized after the
2012 tax review, and it was concluded that the Bank’s ownership rights were not violated for December 2012 and beyond periods. However, since
the aforementioned periods were filed by making a reservation and paying taxes, the mentioned decision had no additional effect on the financial
statements. In addition, at two case files, which was one of the lawsuits regarding the repayment of income tax stoppage and stamp tax which has been
paid by reservation statement beginning from December 2013, of which its court decision was rendered in favour of the Bank, has been reversed by the
majority of the votes of the Assembly after it was submitted to the General Assembly of Tax Courts and the decisions were finalized against the Bank.
Regarding the mentioned issue, the legal process is ongoing.
In this process, the Group companies are acting together with the Parent Bank and in this regard TL 12,662 (December 31, 2021: TL 162,960) have
been transferred to the provision expense accounts in the current period.
i.4.4. In 1993, Dışbank A.Ş. shares which were owned by the Parent Bank were sold to Lapis Holding A.Ş. In 2008, it was claimed that USD 52.6 million
of the amount, which was paid upfront within the context of the sale agreement, had been provided from the funds of the insolvent TYT Bank A.Ş. by the
buyer and payment of the mentioned amount as well as the interest to be calculated to the Savings Deposit Insurance Fund (SDIF) was demanded.
The administrative actions initiated by the SDIF in 2008 were revoked by Council of State Administrative Law Chambers 13th upon the application of
the Bank. The decisions which were in favour of the Bank were reversed by Plenary Session of the Law Chamber upon the appeal of the SDIF, Council of
State Administrative Law Chambers 13th decided to reject the applications of the Bank in January 2016 due to their obligation to obey the decisions of
reversal.
After the aforementioned court decisions, although the legal process was still in progress, the collection procedures were carried out within the context
of Law No. 6183 and TL 298,466 including the default interest, was collected from the Bank by the SDIF at prior periods and made provision for the
whole amount.
As a part of the legal process, individual application to the Constitutional Court of Republic of Turkey has been made by the Bank was not concluded
positively. Regarding the ongoing lawsuits, the negative declaratory action brought against the Bank to determine that the Bank is not a debtor has
been finalized against the Bank. In this context, necessary provision has been made by the Bank in the financial statements dated 31.12.2022 for the
difference between the down payment regarding the sales contract stated above and the amount of 52.6 million USD paid in 2016. legal process is still
ongoing
i.4.5. Except the other provisions indicated above, free provision within conservatism principle, for negative circumstances which may arise from the
possible changes that may arise in the economy and market conditions, amounting to TL 8,475,000 of which TL 4,075,000 provided in prior years and
TL 4,400,000 was provided in the current period.
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 402 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 403
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
j.
j.1.
Information on Tax Liability:
Information on current tax liability:
j.1.1.
Information on tax provision:
Explanations on taxation and calculations are explained in Note XXI of Section Three. As of December 31, 2022, as a result of the clarification of the
Group's corporate tax liability and temporary taxes paid, the remaining corporate tax liability amounts to TL 6,356,595 and as a result of the separate
clarification process of each partnership and tax authority, current tax asset amounting to TL 26,354 occurs.
j.1.2.
Information on taxes payable:
Corporate Tax Payable
Tax on Securities Income
Tax on Real Estate Income
Banking Insurance Transaction Tax
Foreign Exchange Transaction Tax
Value Added Tax Payable
Other
Total
i.1.3.
Information on premiums:
Social Security Premiums – Employees
Social Security Premiums – Employer
Bank Pension Fund Premiums – Employees
Bank Pension Fund Premiums – Employer
Pension Fund Membership Fees and Provisions-Employees
Pension Fund Membership Fees and Provisions-Employer
Unemployment Insurance – Employees
Unemployment Insurance – Employer
Other
Total
j.2. Information on deferred tax liabilities:
Current Period
Prior Period
6,356,595
439,514
8,285
823,231
52,378
114,629
269,451
8,064,083
1,496,283
304,755
6,180
442,711
117,926
46,696
120,263
2,534,814
Current Period
Prior Period
10,348
12,478
18,065
23
6,965
13,942
83
61,904
4,149
5,100
8,250
5
2,999
5,811
8
26,322
The Parent Bank and the consolidated Group companies have TL 1,599,383 deferred tax liability as of December 31, 2022. The related deferred tax
debt is calculated over the temporary differences between the book values of assets and liabilities in the records and their tax base values calculated
according to tax.
Tangible Assets Base Differences
Provisions
Valuation of Financial Assets
Other
Deferred Tax Liability
Movement of the deferred tax asset is as follows:
Beginning Value
Deferred Tax Income / (Expense) (Net)
Deferred Tax Accounted Under Equity
Deferred Tax Accounted Under Previous Year P / L
Exchange rate differences
Other
Deferred Tax Asset (1)
Current Period
Prior Period
2,170,487
(7,697,538)
7,153,981
(27,547)
1,599,383
107,919
(1,754)
14,098
4,686
124,949
Current Period
Prior Period
2,994,027
5,112,280
(8,745,726)
14,146
(625,273)
3,528,305
(767,140)
216,138
16,360
364
2,994,027
(1) In the consolidated financial statements, there are deferred tax assets of TL 974,110 and deferred tax liabilities of TL 1,599,383 in the current period. Explanations on deferred
tax liability are given in Section Five, Note II.h.2.
k. Information on Payables for Assets Held for Sale and Discontinued Operations
The Bank does not have any payables for assets held for sale and discontinued operations.
l. Information on subordinated loans
The Bank;
ੵ As of December 10, 2013, issued 10 year-term bills with a nominal value USD 400,000,000; as of June 29, 2017, issued 11 year-term bills with recall option
on 6th year and a nominal value USD 500,000,000 and as of January 22, 2020, issued 5 year-term with nominal value of USD 750,000,000 which all have
the characteristic of subordinated loans for the purpose of making available to the individuals and legal persons who are resident abroad. Interest rates of
aforementioned bonds are 7.85%, 7.00% and 7.75% respectively.
ੵ As of August 8, 2017, June 19, 2019, and September 26, 2019; the Bank has issued 10 year-term bills with a nominal value of TL 1,100,000,000,
800,000,000 and 350,000,000 (full TL amount) respectively, with floating interest rates for qualified investors without being offered to the public in Turkey,
Nominal value contribution capital has issued borrowing instruments that will be included in the calculation of bonds. The bills mentioned are amounting to TL
33,558,745 as of December 31, 2022 (December 31, 2021 TL 37,470,997).
Current Period
Prior Period
TL
FC
TL
FC
Debt Instruments To Be Included In Additional
Capital Calculation
Subordinated Loans
Subordinated Debt Instrument
Debt Instruments To Be Included In Contribution
Capital Calculation
Subordinated Loans
Subordinated Debt Instrument
Total
m. Information on consolidated shareholders’ equity:
m.1. Presentation of paid-in capital:
Common shares
Preferred shares
Total
2,277,824
31,280,921
2,296,445
39,182,832
2,277,824
2,277,824
31,280,921
31,280,921
2,296,445
2,296,445
39,182,832
39,182,832
Current Period
Prior Period
9,999,970
30
10,000,000
4,499,970
30
4,500,000
j.2. Explanation as to whether the registered share capital system ceiling is applicable at bank, if so, the amount of registered share capital:
Capital System
Registered Capital System
Paid-in Capital
10,000,000
Ceiling
10,000,000
BRSA and CMB approvals regarding the increase of the registered capital ceiling to 25,000,000 TL have been obtained and the approval of the Ministry of Commerce has been applied.
m.3. The capital increase made in current period:
It has been decided to increase the paid-in capital of the Bank from TL 4,500,000 to TL 10,000,000, fully covered by internal resources (extraordinary
reserves). Accordingly, the process of capital increase was completed during the period and the registration of the new capital was carried out on
16.06.2022
m.4. Capital increase through transfer from capital reserves during the current period: None.
m.5. Significant commitments of the Parent Bank related to capital expenditures within the last year and the following quarter, the general purpose
thereof, and the estimation of funds required for them: There is no capital commitment.
Information on shares acquired by the Company: The Parent Bank has repurchased shares amounting to TL 530,307 in accordance with the
m.6.
Board of Directors Decision dated August 17, 2018.
Previous periods’ indicators related to income, profitability and liquidity, and the estimated effects of forecasts, which are to be made by taking
m.7.
into consideration the uncertainties of these indicators, on the Group’s equity: The Parent Bank’s and the Group companies’ balance sheets are managed
in a prudent way to ensure that the effect of risks arising from interest rates, exchange rates and loans is at the lowest level.
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404 İşbank 2022 Integrated Annual Report
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Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
m.8. Privileges Granted to Shares:
Turkish Commercial Law and related registration are kept conditionally;
Group (A) shares each with a nominal value of 1 Kurus have the privileges of;
ੵ receiving 20 times the number of shares in the distribution of bonus shares issued from conversion of extraordinary and revaluation reserves
generated in accordance with the relevant laws (Article 18 of the Articles of Incorporation),
ੵ exercising the preference rights as 20 times (Article 19 of the Articles of Incorporation) and
despite having a lower nominal value, Group (B) shares, each with a nominal value of 1 Kurus, have the same rights with the Group (C) shares having
a nominal value of 4 Kurus each. Furthermore, Group (A) and (B) shares, each with a nominal value of 1 Kurus are granted privileges in distribution of
profits pursuant to Article 58 of the Articles of Incorporation.
m.9.
Information on marketable securities value increase fund:
III. DISCLOSURES AND FOOTNOTES ON CONSOLIDATED OFF-BALANCE SHEET ITEMS
a.
a.1.
Explanations to Liabilities Related to Off-Balance Sheet Items:
Types and amounts of irrevocable loan commitments:
Commitment for customer credit card limits amounts to TL 112,111,363 and commitment to pay for cheque leaves amounts to TL 5,447,537. The
amount of commitment for the forward purchase of assets is TL 2,354,710 and for the forward sale of assets is TL 2,359,062.
a.2.
The structure and amount of probable losses and commitments resulting from off-balance sheet items, including those below:
The Group’s provisions for indemnified non-cash loans balance is TL 1,618,580 as of December 31, 2022 (December 31, 2021: TL 1,215,814) which is
allocated for the non-cash loans of companies whose loans are followed under “Non-performing Loans” accounts, Commitments are shown in the table
of “Off-balance sheet items”.
a.3.
Guarantees, bank acceptances, collaterals that qualify as financial guarantees, and non-cash loans including other letters of credit:
Financial Assets At Fair Value Through Other
Comprehensive Income
Valuation Difference
Deferred Tax Effect on Valuation
Foreign Exchange Differences
Current Period
Prior Period
TL
FC
TL
FC
29,879,045
(4,864,454)
3,409,376
(3,025,127)
39,560,096
(9,768,524)
87,473
(6,237,059)
1,372,605
4,134,003
(777,305)
52,678
3,409,376
(3,656,824)
631,697
(3,025,127)
Total
29,879,045
(4,864,454)
n.
Information on minority interest
Balance at the beginning of the period
Distributed Dividend
Subsidiaries Profit/Loss on minority interest
Effect of change in subsidiaries equity
Effect of change in Group’s minority interest
Period Ending Balance
m. Information on Dividend Distribution
Current Period
Prior Period
9,234,928
(226,322)
7,459,012
2,312,603
21,544
18,801,765
7,413,718
(299,226)
2,019,198
184,536
(83,298)
9,234,928
At the Bank’s Ordinary General Assembly, held on March 25, 2022, it was decided to allocate net profit from operating acitivities of 2021, amounting to
TL 13,467,895 thousand as follows;
ੵ Resulting from the disposal of certain immovables, which are realized within the framework of the equity method specified in the “TAS 27 - Individual
Financial Statements” accounting standard, resulting from the application of the “TFRS 9 - Financial Instruments” reporting standard, and which are
followed within the scope of the “TAS 16 - Tangible Fixed Assets” accounting standard, adding a total of 5,414,586 TL,
ੵ Addition of the provision amount of TL 360,000 allocated during the period for the profit share to be distributed to the personnel within the framework
of the accounting standard "TAS 19-Benefits Provided to the Employees",
ੵ The total amount of TL 143,605, which includes TL 35,132 from real estate sales profits to use for capital increase and TL 108,473 from the amount
allocated as venture capital fund, of the balance sheet profit to be distributed amounting to TL 19,242,481 allocation as special reserve fund,
of the amount as a basis for distribution of TL 19,098,876;
ੵ TL 1,346,780 to A, B and C group shares as cash,
ੵ TL 10 to the founding shares as cash,
ੵ TL 359,481 as cash dividend to employees to be distributed,
ੵ TL 17.392.605 as legal and extraordinary reserves to be reserved,
has been decided. As at March 28, 2022; TL 17,536,210 was transferred to reserves account, cash dividends were distributed to the shares other than
the shares acquired by the Bank, as of April 1, 2022. Since the Bank's Ordinary General Assembly Meeting for the year 2022 was not held as of the date
of the report, the distribution of profits from the activities of the said period was not carried out.
Bank Acceptances
Letters of Credit
Other Guarantees
Total
Current Period
Prior Period
8,053,507
56,868,515
4,841,274
69,763,296
13,805,873
48,873,749
4,269,208
66,948,830
a.4. Certain guarantee, provisional guarantees, suretyships and similar transactions:
Letters of Tentative Guarantees
Letters of Certain Guarantees
Letters of Advance Guarantees
Letters of Guarantee Given to Customs Offices
Other Letters of Guarantee
Total
a.5. Total Non-cash Loans:
Non-cash Loans against Cash Risks
With Original Maturity of 1 Year or Less
With Original Maturity More Than 1 Year
Other Non-cash Loans
Total
Current Period
Prior Period
2,855,259
109,153,663
21,968,649
9,508,835
37,266,219
180,752,625
1,708,305
72,902,038
15,463,646
6,090,285
36,502,689
132,666,963
Current Period
Prior Period
39,218,113
11,916,800
27,301,313
211,297,808
250,515,921
38,252,155
9,601,819
28,650,336
161,363,638
199,615,793
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406 İşbank 2022 Integrated Annual Report
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Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
a.6. Sectoral risk concentration of non-cash loans:
Agriculture
Farming and Livestock
Forestry
Fishery
Industry
Mining and Quarrying
Manufacturing Industry
Electricity, Gas, Water
Construction
Services
Wholesale and Retail Trade
Hotel and Restaurant Services
Transport and Communications
Financial Institutions
Real Estate and Rental Services.
Self-Employment Services
Education Services
Health and Social Services
Other
Total
Current Period
(%)
FC
(%)
82,994
44,531
TL
612,476
490,047
107,093
15,336
33,356,650
1,003,885
25,722,487
6,630,278
10,052,780
47,177,829
27,079,113
1,283,859
5,338,287
9,689,863
2,320,371
812,991
111,558
541,787
357,507
0.05
0.03
0.00
0.02
56.54
0.48
48.51
7.55
15.51
27.07
12.75
0.58
7.52
4.95
0.97
0.09
0.00
0.21
0.83
91,557,242 100.00 158,958,679 100.00
38,463
89,881,397
763,041
77,110,974
12,007,382
24,651,767
43,029,313
20,274,689
914,027
11,961,045
7,869,063
1,546,769
142,340
6,549
314,831
1,313,208
0.67
0.54
0.12
0.01
36.43
1.10
28.09
7.24
10.98
51.53
29.58
1.40
5.83
10.58
2.53
0.89
0.12
0.60
0.39
TL
296,207
199,806
82,391
14,010
12,430,773
320,570
8,203,756
3,906,447
7,523,221
25,875,351
15,532,556
450,043
3,083,759
4,552,217
1,418,580
502,777
73,900
261,519
287,375
46,412,927
Prior Period
(%)
FC
499,227
154,015
1,734
343,478
93,956,535
928,731
83,044,828
9,982,976
21,058,983
36,774,135
18,241,371
1,876,235
7,462,048
7,488,074
1,145,172
239,200
5,300
316,735
913,986
0.33
0.10
0.00
0.23
61.33
0.61
54.21
6.51
13.75
24.00
11.91
1.22
4.87
4.89
0.75
0.16
0.00
0.20
0.59
100.00 153,202,866 100.00
0.64
0.43
0.18
0.03
26.78
0.69
17.68
8.41
16.21
55.75
33.47
0.97
6.64
9.81
3.06
1.08
0.16
0.56
0.62
a.7. Non-cash Loans classified under Group I and Group II:
Non-cash Loans
Letters of Guarantee
Bank Acceptances
Letters of Credit
Endorsements
Group I
TL
90,104,172
84,031,507
5,575,390
492,132
FC
153,272,110
90,131,981
2,435,720
55,921,155
Group II
TL
FC
1,181,740
1,180,240
1,500
4,126,126
3,632,062
40,897
453,167
Underwriting Commitments of the Securities Issued
Factoring Related Guarantees
Other Guaranties and Warranties
5,143
4,783,254
b. Information on derivative financial instruments:
The derivative transactions of the Group mainly consist of money and interest swaps and forward foreign exchange purchase and sale transactions.
In addition to these, money, interest and security options and futures transactions are also performed. Although the Group's derivative transactions
accounted for trading purposes, there are derivative transactions that are accounted for trading purposes, as all the conditions required to be defined as
an item suitable for financial risk hedge accounting are not fulfilled, although they provide economic hedging. On the other hand, derivative transactions,
which are carried out to protect against changes in the fair values of financial instruments and have all the necessary conditions for their evaluation
within the scope of hedge accounting, are classified as hedging purposes.
c.
Explanations Related to Contingencies and Commitments:
The balance of the “Other Irrevocable Commitments” account, which comprised the letters of guarantees, guarantees and commitments submitted by
the Group pursuant to its own internal affairs and guarantees given to third parties by other institutions in favor of the Parent Bank and the commitments
due to housing loans extended within the scope of unfinished house projects followed, amounts to TL 26,407,853.
The cheques given to customers is presented under off balance sheet commitments, as per the related regulations is amounting to TL 5,447,537 in
case the cheques presented for payment to beneficiaries are not covered, the Parent Bank will be obliged to pay the uncovered amount up to TL 3,000
(in exact TL amount) for the cheques that are subject to the Law numbered 3167 on “the Regulation of Payments by Cheque and Protection of Cheque
Holders”, and up to TL 3,600 (in exact TL amount) for the cheques that are subject to the “Cheque Law” numbered 5941, The uncollected amount will
be followed under “Indemnified Non-Cash Loans.
d.
Explanations related to transactions made on behalf of or on the account of others:
It is explained in Note X under Section Four.
(%)
IV.
a.
a.1.
DISCLOSURES AND FOOTNOTES ON THE CONSOLIDATED INCOME STATEMENT
Interest Income
Information on interest income on loans:
Interest Income on Loans (1)
Short-term Loans
Medium and Long-term Loans
Interest on Non-performing Loans
Premiums Received from State Resource Utilization
Support Fund
Current Period
Prior Period
TL
FC
TL
FC
23,507,304
40,324,541
2,581,728
4,332,358
18,049,045
19,307
10,115,449
24,465,421
1,052,273
1,588,844
11,164,912
27,808
Total
66,413,573
22,400,710
35,633,143
12,781,564
(1)Includes fee and commission income on cash loans.
a.2. Information on interest income on banks:
The Central Bank of Turkey
Domestic Banks
Foreign Banks
Foreign Head Offices and Branches
Total
a.3. Information on interest income from securities:
Current Period
Prior Period
TL
FC
TL
FC
737,608
39,480
52,130
134,658
228,800
576,388
31,929
42,304
35,400
777,088
415,588
608,317
77,704
Current Period
Current Period
TL
FC
TP
YP
Financial Assets at Fair Value through Profit and Loss
102,873
192,371
88,439
79,777
Financial Assets at Fair Value through Other
Comprehensive Income
Financial Assets Measured at Amortized Cost
Total
23,120,222
3,804,326
8,946,071
1,855,274
17,828,194
41,051,289
549,041
4,545,738
6,317,828
15,352,338
211,778
2,146,829
As detailed in Note VII of Chapter III, the Bank has consumer price indexed (CPI) government bonds classified as financial assets at fair value through
other comprehensive income, financial assets at fair value through profit or loss and financial assets measured by amortized cost in its securities
portfolio. In the case of CPI forecast changes by 100 basis points in a positive or negative direction, as of 31 December 2022, the Parent Bank’s pre-tax
profit will increase by approximately TL 127 million (full amount) or decrease by the same amount.
a.4. Information on interest income received from associates and subsidiaries:
Interest Received From Affiliates and Subsidiaries
455,651
409,863
Current Period
Priod Period
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Türkiye İş Bankası A.Ş.
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Interest Expense
Information on interest expense from funds borrowed:
b.
b.1.
Banks
Central Bank of Turkey
Domestic Banks
Foreign Banks
Foreign Head Offices and Branches
Other Institutions
Total (1)
(1) Includes fee and commission expenses from cash loans.
b.2. Information on interest paid to associates and subsidiaries:
Current Period
Prior Period
TL
FC
TL
FC
1,111,691
2,727,892
689,455
1,279,070
815,666
296,025
1,363
1,113,054
267,315
2,460,577
1,695,863
4,423,755
426,628
262,827
1,088
690,543
184,463
1,094,607
642,502
1,921,572
Interest Paid to Associates and Subsidiaries
447,325
108,487
Current Period
Prior Period
b.3. Information on interest paid on marketable securities issued:
Interest on Securities Issued
2,365,094
5,870,931
1,611,372
4,437,045
Current Period
Prior Period
TL
FC
TL
FC
b.4. Information on Interest Expense on Deposits According to Maturity Structure:
Prior Period
Demand
Deposits
Up to One
Month
Up to Three
Months
Up to Six
Months
Up to One
Year
Over One
Year
Accumulated
Deposits
Total
Time Deposits
TL
Bank Deposits
Savings Deposits
Public Sector
Deposits
Commercial
Deposits
Other Institutions
Deposits
Deposits with 7
Days Notice
Total
FC
Foreign Currency
Deposits
Bank Deposits
Deposits with 7
Days Notice
Precious Metals
Deposits
236,834
1,089,360
109,341
10,622,231
10
622,976
87,086
115,091
346,175
645 12,537,399
1,257
11,337
328
47
9
12,978
58
1,799,009
2,068,714
58,396
283,679
3,184
4,213,040
44,565
438,198
51,297
446
4,064
538,570
68
3,171,025
13,249,821
732,997
371,258 122,348
645
17,648,162
1,091
31,584
192,184
8,345
389
566
9,973
1,289
8,551
116,522
1
359,906
7,785
6,774
25,148
3,363
411
10,611
637
15,022
Total
TOTAL
9,436
31,973
196,113
11,673
26,947 123,933
1
400,076
9,504 3,202,998 13,445,934
744,670
398,205 246,281
646 18,048,238
Current Period
Demand
Deposits
Up to One
Month
Up to Three
Months
Up to Six
Months
Up to One
Year
Over One
Year
Accumulated
Deposits
Total
c. Explanations on dividend income:
Time Deposits
TL
Bank Deposits
Savings Deposits
Public Sector
Deposits
Commercial
Deposits
Other Institutions
Deposits
Deposits with 7
Days Notice
Total
FC
Foreign Currency
Deposits
Bank Deposits
Deposits with 7
Days Notice
Precious Metals
Deposits
Total
TOTAL
75
8
215,542
1,540,779
132,256
8,305,750
9,067,691
536,973
396,682
347,873
464 19,848,347
2,663
23,780
10
42
2
26,497
Financial Assets with Fair Value Differences Recognized in Profit/Loss
Financial Assets with Fair Value Differences Recognized in Comprehensive Income
Other
Total
129
4,516,737
1,540,121
2,438,509
1,455,146
376,488
10,327,130
d.
Information on trading profit/losses (Net):
117,461
562,135
18,097
1,699
223
699,615
212
6,393,182 10,564,042
11,524,307
1,993,860
773,395
464 31,249,462
1,410
162,334
660,935
74,422
25,328
238,676
2
1,163,107
11,446
7,276
6,060
2,525
19,697
25,975
72,979
Profit
Securities Trading Gains
Gains on Derivative Financial Instruments (1)
Foreign Exchange Gains
Losses (-)
Securities Trading Losses
Losses on Derivative Financial Instruments (1)
Foreign Exchange Losses
Trading Income/Losses (Net)
Current Period
Prior Period
213,750
45,674
4,102
263,526
47,533
20,057
958
68,548
Current Period
Prior Period
1,808,795,913
2,033,732,717
128,986,395
108,952,062
1,570,857,456
1,789,318,125
118,479,257
119,115,248
1,551,723,620
19,477,788
42,406,767
47,875,675
1,943,450,275
2,033,029,265
40,524,089
48,055,434
1,944,449,742
703,452
11
6,524
744
16,422
890
24,591
(1) Income arising from foreign currency changes related to derivative transactions amounting TL 83,206,057 and the losses amounting TL 98,296,587 and the amount of net
loss is TL 15,090,530. (December 31, 2021: profit TL 39,998,909,156 loss TL 40,803,221 and net loss amount TL 804,312)
12,856
169,621
673,519
77,691
61,447
265,541
2
1,260,677
e.
Information on other operating income:
13,068 6,562,803 11,237,561 11,601,998 2,055,307 1,038,936
466 32,510,139
As at reporting period, TL 18,824,865 of other operating income sources from inclusion and classification of operations of insurance and reinsurance
companies; 91% of which is from insurance premiums. (December 31, 2021: TL 10,723,838, 91%). The remaining amount mainly consists of expected
credit loss reversals or collections from Stage 3 loans, and income from fees received from customers in return for various banking services and sales of
fixed assets. On the other hand, the judicial process regarding the refund of the administrative fine paid by the Bank in accordance with the decision of
the Competition Board in 2013 was concluded in favor of the Bank, and the administrative fine of TL 109,992 paid by the Bank was refunded.
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410 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 411
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
f.
Information on expected credit loss and other provision expense:
h.
Information on provision for taxes from continuing and discounted operations
Current Period
Prior Period
The Group's profit before tax arises from continuing operations. As of 31.12.2022, the profit before tax consists of TL 86,431,376 of net interest income,
TL 14,671,415 of net fees and commission income, and the total of personnel expenses and other operating expenses is TL 59,881,644.
Expected Credit Loss
Expected Credit Loss for 12 Months (Stage 1)
Significant Increase in Credit Risk (Stage 2)
Non-Performing Loans (Stage 3)
Impairment Losses on Marketable Securities
Financial Assets at Fair Value through Profit and Loss
Financial Assets at Fair Value Through Other Comprehensive Income
Impairment Losses on Associates, Subsidiaries and Joint-Ventures
Associates
Subsidiaries
Jointly Controlled Entities
Other (1)
Total
13,055,945
1,209,566
1,963,033
9,883,346
91,472
18,954
72,518
12,667,759
1,683,950
4,533,215
6,450,594
21,627
14,145
7,482
h1.
Explanations on net profit / loss of continued and discontinued operations:
As of 31.12.2022, the Group's tax provision amounting to TL 15,453,038 consists of current tax provision of TL 20,565,318 and deferred tax income of
TL 5,112,280. The Group does not have any discontinued operations.
h2.
Explanations on net profit / loss of continued and discontinued operations:
The net profit of the Group from its ongoing operations as of 31.12.2022 is TL 69,057,682.
i.
Information on net period profit/loss:
Income and expenses resulting from ordinary banking activities: There is no specific issue required to be disclosed for the Group’s performance
i.1.
for January 1, 2022-December 31, 2022.
i.2.
Effects of changes in accounting estimates on the current and future periods’ profit/loss: There is no issue to be disclosed.
“The Other’’ item which is located at the bottom “Fees and Commissions Received” in the income statement consist of various fees and
i.3.
commissions received from transactions such as credit card transactions, capital market transactions and insurance-reinsurance transactions.
6,083,658
19,231,075
4,121,104
16,810,490
i.4.
Net profit / loss of Minority Interest:
Current Period
Prior Period
7,459,012
2,019,198
(1) The current period balance is the impairment loss expense of the assets held for sale and discontinued operations detailed in section five i.4.4, litigation provision expense of
TL 825,000 and TL 4,400,000 Includes free provision expense detailed in section five i.4.5.
Net Profit / Loss of Non-controlling Interest
g.
Other operating expenses:
Reserve for Employee Termination Benefits
Bank Pension Fund Deficit Provisions
Impairment Losses on Tangible Assets
Depreciation Expenses of Tangible Assets
Impairment Losses on Intangible Assets
Impairment Losses on Goodwill
Amortization Expenses of Intangible Assets
Impairment Losses on Investments Accounted Under Equity Method
Impairment Losses on Assets to be Disposed
Depreciation Expenses of Assets to be Disposed
Impairment Losses on Assets Held for Sale and Subject to Discontinued Operations
Other Operating Expenses
Leasing Expenses Related to Exceptions to TFRS 16
Repair and Maintenance Expenses
Advertisement Expenses
Other Expenses
Loss on Sale of Assets
Other
Total
Current Period
Prior Period
464,172
2,416,955
4,587
1,136,163
912,870
33,675
378
12,629,150
217,764
550,271
808,529
11,052,586
4,361
24,569,241
42,171,552
190,474
1,892,381
5,795
802,974
35,974
453,413
70
4,972,087
153,700
331,078
362,939
4,124,370
2,056
14,310,652
22,665,876
(1) The Group's expenditure within the scope of donation, aid and social responsibility projects in the current period is TL 79,971 (31.12.2020: TL 104,006).
In the table above, TL 20,610,199 of the operating expenses in the “Other” group arises from the insurance and reinsurance companies because of the
classification of their activities in the "Other" group, and significant portion of the related expenses is compensation expenses paid (December 31, 2021:
TL 11,565,656). The Group's fees, taxes, duties and fund expenses amounting to TL 731,958 and savings deposit insurance fund expense amounting
to TL 1,513,216 (December 31, 2021: TL 1,016,208) are other expense items in the current period "Other" group.
j.
Explanation on other items in income statement
Other items do not exceed 10% of the total amount of the income statement.
k.
Fees for services received from an independent audit firm
In accordance with the decision of KGK dated 26.03.2021, the fees for the reporting period regarding the services received from the independent
auditor or independent audit firm are given in the table below. In addition to the Bank, the fees for services rendered to the Bank's domestic/foreign
subsidiaries and jointly controlled partnerships are included in the aforementioned fees, which are stated as VAT excluded.
Independent Audit Fee for the Reporting Period
Other Assurance Services and Other Non-Audit Fees
Total
Current Period
Prior Period
30,347
8,029
38,376
22,258
5,243
27,501
V.
DISCLOSURES AND FOOTNOTES ON CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY
The paid-in capital is TL 10,000,000 in legal records. As of balance sheet date, the balance of legal reserves is TL 7,091,285 the balance of
extraordinary reserves is TL 289,294 and the balance of statuary reserves is TL 51,415,041.
The details of revaluation surplus account of securities are shared in the Note Section V-II-l-9. TL (8,395,919) of this amount is the deferred tax effect
on marketable securities at fair value through other comprehensive income (December 31, 2021: TL (145,608)).
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412 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 413
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
VI. DISCLOSURES AND FOOTNOTES ON THE CONSOLIDATED STATEMENS OF CASH-FLOWS
VII. DISCLOSURES AND FOOTNOTES ON THE GROUP’S RISK GROUP
The consolidated operating profit of TL 65,423,795 before the changes in operating assets and liabilities mostly comprised of TL 118,786,745 of
interest received from loans and securities, and TL 49,665,722 of interest paid on deposits, money market transactions and funds borrowed by the
Bank. An important part of other revenues, TL 25,750,270 consists of premium collections of insurance companies. The account “Other” classified
under operating profit other than fees and commissions paid, cash payments to personnel and service suppliers and taxes paid consists of other
operating expenses and foreign exchange gains/losses accounts is TL (13,421,662) (December 31, 2021: TL (10,686,634)).
Net Increase (Decrease) in Other Liabilities account classified in changes of assets and liabilities resulting from the changes in Funds Provided Under
Repurchase Agreements, miscellaneous payables, other liabilities and taxes, duties, charges, and premiums is decreased by TL 63,388,101 (December
31, 2021: TL 49,287,428 decrease).
The Net Cash Provided from Other Investing Activities account includes net cash flows from the sale of intangible assets and declined by TL 2,756,163
(December 31, 2021: TL 922,250 decrease).
Foreign currency exchange differences on cash and cash equivalents are on the positive side TL (975,670) (31.12.2021 TL 1,317,136) as of December
31, 2022. Due to the high rate of turnover of related foreign currency assets, the difference between the last 30 days’ arithmetic average of currency
exchange rates and the year-end currency exchange rate is used to calculate the effect of change in foreign exchange rate. Under the same assumption,
the effect of change in foreign exchange rate on cash and cash equivalents is calculated.
Information on the volume of transactions relating to the Group’s risk group, incomplete loan and deposit transactions and period’s profit
a.
and loss:
a.1. Information on loans held by the Group’s risk group:
Current Period:
Group’s Risk Group
Loans
Investments in Associates,
Subsidiaries and Jointly
Controlled Entities (Joint
Ventures)
Direct and Indirect
Shareholders of the Bank
Other Real Persons and
Corporate Bodies that have
been Included in the Risk
Group
Cash
Non-Cash
Cash
Non-Cash
Cash
Non-Cash
Balance at the beginning of the period
Balance at the end of the period
Interest and commission income received
2,402,860
2,343,655
455,651
16,824,670
17,111,566
5,747
1,916,562
2,920,845
295,514
608,306
1,309,864
7,447
Cash, cash in foreign currency, unrestricted deposits in Central Bank of Turkey, money in transit, cheques purchased, money market operations as well as
demand deposits and time deposits up to 3 months are defined as cash and cash equivalents.
Prior Period:
Cash and cash equivalents at beginning of period:
Cash
Cash in TL and Foreign Currency
Central Bank of Turkey and Other
Cash Equivalents
Receivables from Money Market Operations
Banks’ Demand Deposits and Time Deposits Up to 3 Months
Total Cash and Cash Equivalents
December 31, 2021
December 31, 2020
96,316,663
14,862,587
81,454,076
36,005,939
2,950,824
33,055,115
132,322,602
32,519,831
9,136,817
23,383,014
19,801,714
2,179,919
17,621,795
52,321,545
The total amount resulting from the transactions made in the previous period shows the total cash and cash equivalents as of the beginning of the
current period.
Cash and Cash equivalents as of end of the period:
Cash
Cash in TL and Foreign Currency
Central Bank of Turkey and Other
Cash Equivalents
Receivables from Money Market Operations
Banks’ Demand Deposits and Time Deposits Up to 3 Months
Total Cash and Cash Equivalents
December 31, 2022
December 31, 2021
79,788,516
15,828,672
63,959,844
34,356,072
6,101,378
28,254,694
96,316,663
14,862,587
81,454,076
36,005,939
2,950,824
33,055,115
114,144,588
132,322,602
Group’s Risk Group
Loans
Investments in Associates,
Subsidiaries and Jointly
Controlled Entities (Joint
Ventures)
Direct and Indirect
Shareholders of the Bank
Other Real Persons and
Corporate Bodies that have
been Included in the Risk
Group
Cash
Non-Cash
Cash
Non-Cash
Cash
Non-Cash
Balance at the beginning of the period
Balance at the end of the period
Interest and commission income received
2,857,404
2,402,860
409,863
9,877,588
16,824,670
2,468
1,232,269
1,916,562
168,639
495,030
608,306
4,397
a.2. Information on deposits held by the Group’s risk group:
Current Period:
Group’s Risk Group
Deposits
Balance at the beginning of
the period
Balance at the end of the period
Interest expense on deposits
Prior Dönem:
Group’s Risk Group
Deposits
Balance at the beginning of
the period
Balance at the end of the period
Interest expense on deposits
Investments in Associates,
Subsidiaries and Jointly Controlled
Entities (Joint Ventures)
Direct and Indirect Shareholders
of the Bank
Current Period
Current Period
Other Real Persons and
Corporate Bodies that have
been Included in the Risk Group
Current Period
10,076,451
13,305,929
447,325
302,826
130,226
58,439
1,710,018
5,589,672
172,982
Investments in Associates,
Subsidiaries and Jointly Controlled
Entities (Joint Ventures)
Direct and Indirect Shareholders
of the Bank
Other Real Persons and
Corporate Bodies that have
been Included in the Risk Group
7,520,649
10,076,451
108,487
157,226
302,826
25,060
1,153,201
1,710,018
62,988
a.3. Information on forward and option and other similar agreements made with the Group’s risk group:
Group’s Risk Group
Investments in Associates,
Subsidiaries and Jointly
Controlled Entities (Joint
Ventures)
Direct and Indirect Shareholders
of the Bank
Other Real Persons and
Corporate Bodies that have
been Included in the Risk Group
Current Period
Prior Period Current Period
Prior Period Current Period
Prior Period
Transactions in which the Difference in Fair
Value is Reflected in Profit or Loss
Balance at the beginning of the period
Balance at the end of the period
Total Profit/Loss
422,104
14,841,605
23,306
422,104
7,737
Transactions for hedging purposes
Beginning of the period
End of the period
Total Profit/Loss
(1,400)
(2,052)
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414 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 415
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
b. Disclosures for the Group’s risk group:
The relations of the Group with corporations in its risk group and under its control regardless of whether there are any transactions between the
b.1.
parties:
All types of corporate and retail banking services are provided to these corporations in line with the articles of Banking Law.
The type and amount of transaction carried out, and its ratio to the overall transaction volume, values of principal items and their ratios to overall
b.2.
items, pricing policy and other items in addition to the structure of the relationship:
The transactions carried out are mainly loan and deposit transactions, The ratio of loans extended to the risk group to the overall loans is 0.62%, while
the ratio to the overall assets is 0.31% the ratio of deposits of the risk group corporations to the overall deposits is 2%, while the ratio to overall liabilities is
1.11%, The comparable pricing method is used for the transactions.
Purchase and sale of real estates, other assets and services, agency agreements, finance lease contracts, transfer of information obtained
b.3.
through research and development, license agreements, funding (including loans and provision of support as cash capital or capital-in-kind), guarantees
and collaterals and management agreements:
The Parent Bank’s branches act as agents of Anadolu Anonim Türk Sigorta Şirketi and Anadolu Hayat Emeklilik A.Ş. Furthermore, through its branches,
the Bank mediates the order transmission for İş Yatırım Menkul Değerler A.Ş. and carries out agency activities of İş Portföy Yönetimi A.Ş. 34 mutual funds
which are founded by the Anadolu Hayat Emeklilik A.Ş. are managed by İş Portföy Yönetimi A.Ş. Securities purchases, when required, are made by İş
Finansal Kiralama A.Ş., a subsidiary of the Bank, through leasing.
If requested, the cash and non-cash loan needs of the risk group companies are met in accordance with the limits imposed by Banking Law and the
prevailing market conditions.
b. 4. As of December 31, 2022, total worth of the shares, which the Parent Bank purchased from its subsidiaries that are traded on Istanbul Stock
Exchange and accounted under the Financial Assets at Fair Value Through Profit or Loss in accordance with the Board of Directors decision dated
December 25, 2015 and relevant following decisions is TL 164,806 (December 31, 2021: TL 51,582).
c.
Total salaries and similar benefits paid to the (executive members and senior executives)
In the current period, the net payment provided to the key management of Group amounts TL 309,172 (December 31, 2021: TL 167,759).
Milli Reasürans T.A.Ş
Domestic Branches (1)
Foreign Representative
Offices
Foreign Branches
Off-Shore Branches
JSC İşbank
Domestic Branches (1)
Foreign Representative
Offices
Foreign Branches
Off-Shore Branches
Number
Employees
1
1
3
Number
187
Country of Incorporation
Total Assets
Legal Capital
12
Singapore
775.554
618.156
Employees
97
Country of Incorporation
Total Assets
Legal Capital
VIII. DISCLOSURES ON THE GROUP’S DOMESTIC, FOREIGN, OFF-SHORE BRANCHES OR PARTICIPATIONS AND REPRESENTATIVE
(1) The branches of the company, which is headquartered in Moscow, in Russia are shown as domestic branches.
OFFICES
The Parent Bank – Türkiye İş Bankası A.Ş.
Domestic Branches (1)
1.110
22.971
Number
Employees
Country of
Incorporation
China
Egypt
England
TRNC
Iraq
Kosovo
Bahrain
3
2
49
207
40
31
6
140
Country of
Incorporation
Foreign Representative
Offices
Foreign Branches
1
1
2
14
2
2
1
Off-Shore Branches
(1) Türkiye’de bulunan Serbest Bölge şubeleri yurt içi şube sayısına dahil edilmiştir.
İşbank AG
Domestic Branches (1)
Foreign Representative
Offices
Foreign Branches
Off-Shore Branches
Number
Employees
8
1
(1) The branches of the company, which is headquartered in Germany, in Germany are shown as domestic branches
6
Netherlands
3,424,635
Total Assets
Legal Capital
JSC İşbank Georgia
Domestic Branches (1)
2
62
Number
Employees
Country of Incorporation
Foreign Representative
Offices
Foreign Branches
Off-Shore Branches
Total Assets
Legal Capital
(1) The branches of the company, which is headquartered in Tiflis, in Georgia are shown as domestic branches.
Number of employees of consolidated companies that does not have agencies and branches abroad:
Employees
Total Assets
Legal Capital
53,147,779
28,264,019
6,837,919
3,157,421
8,094,514
2,248
80,000
842,061
199,247
Anadolu Anonim Türk Sigorta Şirketi
Anadolu Hayat Emeklilik A.Ş.
Efes Varlık Yönetimi A.Ş.
İş Faktoring A.Ş.
İş Finansal Kiralama A.Ş.
İş Gayrimenkul Yatırım Ortaklığı A.Ş.
İş Girişim Sermayesi Yatırım Ortaklığı A.Ş.
İş Portföy Yönetimi A.Ş.
İş Yatırım Menkul Değerler A.Ş.
İş Yatırım Ortaklığı A.Ş.
Maxis Girişim Sermayesi Yatırım Ortaklığı A.Ş
Maxis Investments Ltd (1)
Moka Ödeme ve Elektronik Para Kuruluşu A.Ş.
TSKB Gayrimenkul Yatırım Ortaklığı A.Ş.
Türkiye Sınai Kalkınma Bankası A.Ş.
Yatırım Finansman Menkul Değerler A.Ş.
1,577
1,044
103
120
142
72
5
79
468
5
15
9
48
11
438
148
(1) The Company, which is headquartered in London, does not have any branch or representative office beside its head office. Yatırım Varlık Kiralama A.Ş. which is included to
scope of consolidation during the current period does not have any employees.
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416 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 417
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
Notes to the Consolidated Financial Statements
for the Year Ended December 31, 2022
IX. SUBSEQUENT EVENTS
Within the scope of the decision of the Board of Directors regarding the issue of debt instrument on October 7, 2022, the Parent Bank issued a financial
bond with a nominal value of TL 1,481,892 after December 31, 2022.
It has been noted that a state of emergency involving 10 provinces in the region will be declared due to the negativity caused by the earthquakes
centered in Kahramanmaraş, affecting many of our provinces and shaking our entire country. Developments related to this natural disaster are being
closely monitored, and efforts for the assessment of this situation is ongoing.
SECTION SIX: OTHER EXPLANATIONS
I.
EXPLANATIONS ON THE GROUP’S CREDIT RATINGS:
Türkiye İş Bankası A.Ş.
MOODY’S
Long-term Foreign Currency Deposit
Long-term Local Currency Deposit
Long-term Foreign Currency Senior Debt
Short-term Foreign Currency Deposit
Short-term Local Currency Deposit
FITCH RATINGS
Long-term Foreign Currency Issuer Default Rating
Long-term Local Currency Issuer Default Rating
Short-term Foreign Currency Issuer Default Rating
Short-term Local Currency Issuer Default Rating
National Long-term Rating
Viability Rating
The dates when the Bank's credit ratings/outlooks were last updated are given below:
Moody's: 16.08.2022, Fitch Ratings: 26.07.2022
İş Finansal Kiralama A.Ş.
FITCH RATINGS
Long-term Foreign Currency Issuer Default Rating
Long-term Local Currency Issuer Default Rating
Short-term Foreign Currency Issuer Default Rating
Short-term Local Currency Issuer Default Rating
National Long-term Rating
Support Rating
Rating
Outlook (*)
B3
B3
B3
Not-Prime
Not-Prime
B-
B
B
B
A+ (tur)
B
Stable
Stable
Stable
-
-
Negative
Negative
-
-
Negative
-
Rating
Outlook (*)
B-
B
B
B
A+(tur)
B-
Negative
Negative
-
-
Negative
-
The date when the credit ratings/outlooks of İş Finansal Kiralama A.Ş were last updated are given below:
Fitch Ratings: 26.07.2022
Türkiye Sınai Kalkınma Bankası A.Ş.
MOODY’S
Long-term Foreign Currency Issuer Rating
Long-term Local Currency Issuer Rating
Long-term Counterparty Risk Rating
Counterparty Risk Asessment
Basic Credit Assessment
Adjusted Basic Credit Assessment
Priority Unsecured Debt Rating
Foreign Currency GMTN Program Rating
FITCH RATINGS
Long-term Foreign Currency Issuer Default Rating
Long-term Local Currency Issuer Default Rating
Short-term Foreign Currency Issuer Default Rating
Short-term Local Currency Issuer Default Rating
Long-term National Rating
Financial Capacity Rating
Short-Term Priority Unsecured Debt Rating
Rating
Outlook (*)
B3
B3
B3
B3(cr)
caa1
caa1
B3
(P)B3
B-
B
B
B
ns
b-
B
Stable
Stable
-
-
-
-
Stable
-
Negative
Negative
-
-
-
-
-
The date when the credit ratings/outlooks of TSKB were last updated are given below:
Moody's: 16.08.2022, Fitch Ratings: 26.07.2022
(*) Outlook:
“Stable” indicates that the current rating will not be changed in the short term; “positive” indicates that the current rating is very likely to be upgraded and
“negative” indicates that the current rating is very likely to be downgraded.
SECTION SEVEN: EXPLANATIONS ON THE INDEPENDENT AUDITORS’ REPORT
I.
EXPLANATIONS ON THE INDEPENDENT AUDITORS’ REPORT:
The consolidated financial statements and disclosures for the year ended December 31, 2022 have been reviewed by Güney Bağımsız Denetim ve
Serbest Muhasebeci Mali Müşavirlik Anonim Şirketi (A member firm of Ernst&Young Global Limited) and the independent auditor’sreport dated February
7, 2022, is presented preceding the consolidated financial statements.
I.
EXPLANATIONS AND FOOTNOTES OF THE INDEPENDENT AUDITORS REPORT
There are no significant issues or necessary disclosures or notes in relation to the Group’s operations other than those mentioned above.
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418 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 419
Annexes
Activities for which Support Services are Received in Accordance
with the Regulation on Procurement of Support Services for Banks
Activities for which Support Services are Received in Accordance
with the Regulation on Procurement of Support Services for Banks
ੵ Support services received from Atos Müşteri Hizmetleri A.Ş. for sales-oriented external calls,
ੵ Support services received from ATP Ticari Bilgisayar Ağı ve Elektrik Güç Kaynakları Üretim ve Pazarlama Ticaret A.Ş. regarding the
ੵ Support services received from KKB Kredi Kayıt Bürosu A.Ş. regarding the use of Anadolu Data Center hard disk space,
ੵ Support services received from Kurye Net Motorlu Kuryecilik ve Dağıtım Hizmetleri A.Ş. for delivery of credit card products to
transfer of right to use software and documents,
customer addresses,
ੵ Support services received from Austriacard Turkey Kart Operasyonları A.Ş. for production and customization of credit cards and
ੵ Support services received from Loomis Güvenlik Hizmetleri A.Ş. for transporting cheques, promissory notes, other commercial
debit cards following purchase of credit card and debit card plastics,
papers and documents,
ੵ Support services received from Bilişim Bilgisayar Hizmetleri Ltd. Şti. for use of the payment application on Cash Registers,
ੵ Support services received from Brink's Güvenlik Hizmetleri A.Ş. for international transportation,
ੵ Support services received from CMC İletişim ve Çağrı Merkezi Hizmetleri A.Ş. aimed at calling customers and reminding them
about deferrals regarding retail loans and credit cards payments,
ੵ Support services received from Comdata Teknoloji ve Müşteri Hizmetleri A.Ş. aimed at calling customers and reminding them about
deferrals regarding retail loans and credit cards payments,
ੵ Support services received from Definex Danışmanlık A.Ş. for the development of a project loans app, risk center queries and foreign
trade processes,
ੵ Support services received from Edata Elektronik San ve Tic A.Ş. for maintenance of and running the Bank’s application on cash
registers,
ੵ Support services received from E-Kart Elektronik Kart Sistemleri San. Tic. A.Ş. for production and customization of credit cards and
debit cards following purchase of credit card and debit card plastics,
ੵ Support services received from Enuygun Com İnternet Bilgi Hizmetleri Teknoloji ve Ticaret A.Ş. for marketing of consumer loans,
ੵ Support services received from Erişim Müşteri Hizmetleri A.Ş. to meet the demands of customers using the telephone branch,
ੵ Support services received from Hangisi İnternet ve Bilgi Hizmetleri A.Ş. for marketing of consumer loans,
ੵ Support services received from Hobim Arşivleme ve Basım Hizmetleri A.Ş. for printing and/or enveloping bank statements of the
ੵ Support services received from Loomis Güvenlik Hizmetleri A.Ş. for transporting cash,
ੵ Support services received from Loomis Güvenlik Hizmetleri A.Ş. for transporting cash abroad,
ੵ Support services received from Loomis Güvenlik Hizmetleri A.Ş. for customer collection, transportation, processing and storage,
ੵ Support services received from Mikrosaray Mikrobilgisayar Paz. ve Tic. A.Ş. for directing customers to the Bank’s branches to upload
the Bank's application to cash registers,
ੵ Support services received from Mikrosaray Mikrobilgisayar Paz. ve Tic. A.Ş. for maintenance of and running the Bank’s application
on cash registers,
ੵ Support services received from MT Bilgi Teknoloji Dış Ticaret A.Ş for maintenance of and running the Bank’s application on cash
registers,
ੵ Support services received from Obase Bilgisayar Danışmanlık Hizmetleri Ticaret San. A.Ş. for outsourcing data analytic activities,
ੵ Support services received from Panaroma Bilişim Teknolojileri San. ve Tic. A.Ş. for maintenance of and running the Bank’s
application on cash registers,
ੵ Support services received from Payten Teknoloji A.Ş. regarding secure e-payment infrastructure for electronic commerce,
ੵ Support services received from Plastik Kart Akıllı kart İletişim Sistemleri San. ve Tic. A.Ş. for production and customization of credit
cards and debit cards following the purchase of credit card and debit card plastics,
ੵ Support services received from Postkom Basım ve Posta İletişim Hizmetleri A.Ş. for printing and/or enveloping bank statements of
credit cards and contracted merchants, and other documents such as letters and notices,
credit cards and contracted merchants, and other documents such as letters and notices,
ੵ Support services received from Hugin Yazılım Teknolojileri San. ve Tic. A.Ş. for maintenance of and running the Bank’s application on
ੵ Support services received from R2 Servis Elektrik, Elektronik ve Bilgisayar Teknolojileri San. ve Tic. A.Ş. for maintenance of and
cash registers,
running the Bank’s application on cash registers,
ੵ Support services received from Iron Mountain Arşivleme Hizmetleri A.Ş. regarding physical archive services,
ੵ Support services received from Iron Mountain Arşivleme Hizmetleri A.Ş. for opening archive boxes, scanning of contracts and
uploading them into the Bank's system by firm personnel, in addition to physical archive services,
ੵ Support services received from Ingenico Ödeme Sistem Çözümleri A.Ş. for maintenance of and running the Bank’s application on
cash registers,
ੵ Support services received from Innova Bilişim Çözümleri A.Ş. regarding the use of virtual POS,
ੵ Support services received from Infina Yazılım A.Ş. regarding purchasing, installation, and maintenance of software and support
services to be rendered throughout the term of the contract,
ੵ Support services received from İnfoteks Bilgisayar Elektronik Telekom San. Tic. LTD. Şti. for maintenance of and running the Bank’s
application on cash registers,
ੵ Support services received from İş Net Elektronik Bilgi Üretim Dağıtım Ticaret ve İletişim Hizmetleri A.Ş. regarding the provision of
required resources for the operation, management and maintenance of data processing application servers and server operating
systems, and the operation, management and maintenance of communication networks,
ੵ Support services received from Jetizz Hızlı Taşımacılık A.Ş. for delivery of card products to our customers’ addresses,
ੵ Support services received from Jetizz Hızlı Taşımacılık A.Ş. for sending Banking Services Agreements to the addresses of
applicants who apply for "Anında Müşteri" and delivering the signed contracts to the Bank,
ੵ Support services received from Karbil Yazılım ve Bilişim Teknolojileri Tic. A.Ş. for maintenance of and running the Bank’s application
on cash registers,
ੵ Support services received from Key Yazılım Çözümleri A.Ş. regarding expertise software,
ੵ Support services received from Konut Kredisi Com Tr Danışmanlık A.Ş. for marketing of consumer loans,
ੵ Support services received from Softtech Yazılım Teknolojileri Araştırma Geliştirme ve Pazarlama Tic. A.Ş. for information systems
management, information systems infrastructure support, software development, project development, business analysis, systems
analysis, project and product consulting, and technical support,
ੵ Support services received from Softtech Yazılım Teknolojileri Araştırma Geliştirme ve Pazarlama Tic. A.Ş. for digitalization of financial
analysis processes,
ੵ Support services received from Token Finansal Teknolojiler A.Ş. for maintenance of and running the Bank’s application on cash
registers.
ੵ Support services received from Emlakjet İnternet Hizmetleri ve Gayrimenkul Danışmanlığı A.Ş. for marketing of consumer loans,
ੵ Support services received from Arabam Com İnternet ve Bilgi Hizmetleri A.Ş. for marketing of consumer loans,
ੵ Software development and maintenance services from Topkapı Danışmanlık Elektronik Hizmetler Pazarlama ve Ticaret A.Ş.,
ੵ Document Scanning and Barcode Reading Contract from İş Merkezleri Yönetim ve İşletim A.Ş.,
ੵ Support services received from Paygo Finansal Teknolojileri A.Ş. for maintenance of and running the Bank’s application on cash
registers,
ੵ Software development and support service received from Softtech Yazılım Teknolojileri Araştırma Geliştirme ve Pazarlama Tic. A.Ş.
within the framework of the Capital Markets Infrastructure Transformation Program,
ੵ Support services received from Figo Ticari Bilgi ve Uygulama Platformu A.Ş. regarding supplier financing needs,
ੵ Support services received from AVI Gayrimenkul Yatırım Değerleme ve Danışmanlık A.Ş. regarding mortgage establishment
transactions,
ੵ Support services received from FU Gayrimenkul Yatırım Danışmanlık A.Ş. regarding mortgage establishment transactions,
ੵ Support services received from İPOTEKA Gayrimenkul Yatırım Danışmanlık A.Ş. regarding mortgage establishment transactions
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İşbank 2022 Integrated Annual Report 421
Additional Information Provided Within the Scope of
Relevant Legislation
Additional Information Provided Within the Scope of
Relevant Legislation
Duties undertaken by İşbank’s Board Members outside the Bank
Name-Surname
Duty
Duties Undertaken Outside İşbank
Adnan Bali
Chairperson of the Board of
Directors
Chairperson of the Board of Directors of Türkiye Sınai Kalkınma Bankası A.Ş.,
Chairperson of the Board of Directors of Türkiye İş Bankası A.Ş. Members'
Supplementary Social Security and Charity Fund Foundation, Chairperson of
the Board of Directors of Softtech Ventures Teknoloji A.Ş., Member of the High
Advisory Board of Darüşşafaka Society
Yusuf Ziya Toprak
Deputy Chairperson of the
Board of Directors
None
Hakan Aran
Board Member
Trakya Yatırım Holding A.Ş., İşbank AG
Feray Demir
Board Member
Ersin Önder Çiftçioğlu
Board Member
Fazlı Bulut
Board Member
Durmuş Öztek
Board Member
Board Member of Türkiye İş Bankası A.Ş. Members' Supplementary Social
Security and Charity Fund Foundation
None
None
None
ੵ I am capable of dedicating sufficient time to be able to observe İşbank’s activities and to fulfill the requirements of the duties I
undertake,
ੵ I have not been a member of the Board of Directors of İşbank for more than six years in total within the last decade,
ੵ I am not an independent member of the Board of Directors in more than three of the companies controlled by İşbank or by the
shareholders who control the management of İşbank, and in more than five of the publicly traded companies in total,
ੵ I have not been registered and announced on behalf of the juridical person elected as a member of the Board of Directors,
ੵ I still have all the qualifications as per the Corporate Governance Principles to be an independent member, and I will protect all
these conditions during the term of duty in case I am appointed as an independent member. In the event that a situation arises
that compromises my independence, I will immediately notify the Board of Directors of İşbank, together with its justification, and
simultaneously notify the Capital Markets Board of this situation and its justification in writing. And thus, I am independent.”
Remuneration
ੵ In accordance with the General Assembly decision taken on 25.03.2022, a net allocation of TL 57,820 is paid to the members
of the Board of Directors on an individual basis every month. Benefits paid to key management personnel in 2022 amount to TL
78,529 thousand. Moreover, expenses for allowance, travel, accommodation, representation, as well as the opportunities in cash
and in kind, insurance and similar guarantees for key management personnel in the same year amount to TL 19,987 thousand.
Dividend Payments:
Recep Hakan Özyıldız
Board Member
Part-time academic tutor at Ankara University, Faculty of Political Sciences
Mustafa Rıdvan Selçuk
Board Member
BDD Bağımsız Denetim ve Danışmanlık A.Ş. Independent Auditor, Girişim YMM
Ltd. Şti. Partner
Information on İşbank’s dividend payment policy as set out in detail in Article 58 of the Bank’s Articles of Incorporation is provided
in the integrated annual report. The said information is also available on the Bank’s corporate website under the title of Investor
Relations, in Turkish and English.
Ahmet Gökhan Sungur
Board Member
Sadrettin Yurtsever
Board Member
None
None
Independence declaration of Mr. Ahmet Gökhan Sungur, Independent Member of the Board
Mr. Ahmet Gökhan Sungur was nominated as Independent Member of the Board to the Corporate Governance Committee that
performs the tasks of the Nomination Committee, and the Corporate Governance Committee’s “Evaluation Report of Independent
Member Nominee” dated 29.01.2020 was submitted to the Board on the same date. The independence declaration of Mr. Ahmet
Gökhan Sungur, who was elected as an Independent Member of the Board at the Ordinary General Meeting dated 31.03.2020, is
quoted below:
“As per the requirements of the legislation, Corporate Governance Principles of the Capital Markets Board and the Articles of
Incorporation of İşbank, due to my nomination as an “independent member” to the Board of Directors of İşbank, I hereby declare to
the committee, İşbank shareholders and all the related parties that;
ੵ Within the last five years, there has not been any employment relationship in a managerial position to assume important duties
and responsibilities, any joint or sole ownership of more than 5% of capital, voting rights, or privileged shares, nor has there been
any significant commercial relationship established between (i) İşbank, partnerships where İşbank has management control or
significant impact and partners that have management control of İşbank or significant impact on İşbank, (ii) and I, my spouse and
my relatives by blood or by marriage up to the second degree;
ੵ Within the last five years, I have not worked as an executive manager, been a board member, or a partner owning 5% and above
shares assuming important duties and responsibilities in companies, particularly in companies that provide auditing (including
tax audit, legal audit, internal audit), rating, and consulting services to İşbank, from which İşbank purchases or to which İşbank
sells products and services within the framework of agreements signed during the timeframe of selling/purchasing products and
services,
ੵ I possess the professional education, knowledge, and experience necessary to fulfill the duties I will assume as an independent
board member,
ੵ I am not working full-time in public institutions and organizations,
ੵ I am considered as a resident in Türkiye according to the Income Tax Law (no.193) dated 31/12/1960,
ੵ I have high ethical standards, a professional reputation, and the experience necessary to positively contribute to İşbank’s activities,
to maintain my objectivity in conflicts of interest between İşbank and its shareholders, and to decide independently by taking into
account the rights of stakeholders,
Company Share Information:
İşbank’s Group A and Group B shares are listed on the Main Market with the ISATR and ISBTR symbols; İşbank’s Group C shares
are listed on the Stars Market with the ISCTR symbol. İşbank’s Group C shares are traded on the London Stock Exchange as Global
Depositary Receipts, being subject to “Regulation S”; they are also traded on over-the-counter markets in the USA as American
Depositary Receipts, being subject to “Rule 144A”.
Changes in the Organizational Structure in 2022
ੵ Information Security, Internal Control, Corporate Compliance, and Risk Management Divisions were affiliated to the Deputy Chief
Executive reporting to the Audit Committee.
ੵ Five of our regional departments operating under the Retail Loans Underwriting Division were terminated.
ੵ Loans Monitoring Regional Departments were established.
Other Issues
ੵ No custom audits were carried out at İşbank within the scope of Articles 207, 438, and 439 of the Turkish Commercial Code in
2022. Our bank is subject to public auditing, especially public institutions such as BRSA, CMB, Competition Board, and the Central
Bank. If there is a situation that needs to be disclosed to the public regarding the audits of the aforementioned public institutions in
our Bank, they are disclosed via the KAP platform.
ੵ Mr. Adnan Bali, Chairperson of the Board of Directors, also serves as the Chairperson of the Board of Türkiye Sınai ve Kalkınma
Bankası A.Ş. (TSKB), a subsidiary of İşbank, within the framework of the consent obtained regarding the prohibition to trade with
and compete against the company based on related regulations of the Turkish Commercial Code.
ੵ Companies within the İşbank group do not have any shares in the Bank's capital.
ੵ At the Board of Directors meeting of our Bank dated 16.01.2023, our application to the Banking Regulation and Supervision Agency
and the Capital Markets Board regarding the increase of the registered capital ceiling of our Bank from TL 10 billion to TL 25 billion,
the extension of the Authorization Period for the Registered Capital Ceiling until the end of 2027, and the amendment of Article 5 of
the Articles of Incorporation was approved.
ੵ The actions required with respect to the decisions made at the Ordinary General Shareholders’ Meeting of 2022 were performed.
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 422 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 423
Information on the Transactions Carried Out with the
Bank's Risk Group
İşbank's Subsidiaries
All financial services provided to companies within İşbank’s Risk Group are provided on an arm’s length basis, subject to the same
procedures and policies applicable to third parties. Credit lines and other lending transactions allocated to companies within İşbank’s
Risk Group are analyzed and monitored to ensure that such transactions are within regulatory limits. In 2022, the loans extended to
Group companies were all below the regulatory risk limits.
On July 26, 2022, Fitch Ratings assigned TSKB, which had a consolidated shareholder equity of TL 13 billion and total assets of TL
117.6 billion as of end-December 2022, a long-term local currency credit rating of B and a foreign currency credit rating of B- with
negative outlooks. Finally, TSKB was assigned a national long-term rating of AA (tur) and Viability Rating of (b-) with a stable outlook.
On August 16, 2022, Moody’s affirmed TSKB’s Credit Assessment rating as caa1, and Long-Term Domestic and Foreign Currency
Issuer ratings as B3 and updated the outlooks as stable.
İşbank's Subsidiaries
Finance
İşbank has financial services subsidiaries that are active in the business lines of banking, insurance, private pension, capital market
brokerage, portfolio management, venture capital, factoring, reinsurance, financial leasing, asset management, securities investment
trust, investment banking, payment services and real estate investment trust.
Financial services subsidiaries enrich the range of products and services offered by İşbank to individual and corporate customers in
different business lines while also creating complementary and cross-product delivery and sales opportunities.
TSKB
Türkiye’s first privately-owned development and investment bank
TSKB, as a leader among the privately-owned development and investment banks, has undertaken a significant role in Türkiye’s
economic development since its incorporation in 1950.
The Bank continues to add sustainable value for stakeholders and the national economy with the value it generates in economic,
environmental and social areas. Offering its customers a wide range of innovative services with its in-depth knowledge in corporate
banking, investment banking and advisory services, TSKB has adopted it as its mission to contribute continued and increasing
support to the inclusive and sustainable development of the country.
Within the scope of the resources obtained from development finance institutions and international financial institutions, TSKB
provides loans in the area of renewable energy and adaptation, as well as social loans related to women’s employment, supporting
employment management in underdeveloped areas, and indirectly transfers funds to SMEs’ investments in diverse sectors through
APEX loans provided to financial institutions.
Undertaking a key role in the development and sustainable growth of the Turkish economy, TSKB maintained its No. 1 position
in Türkiye and strengthened its position globally by ranking in the lowest risk group with 7.9 points as a result of a 5.6 point
improvement in the Environmental, Social and Governance (ESG) risk rating as of September 2022 by Sustainalytics, an independent
specialized organization. TSKB is also one of the leading organizations when it comes to corporate governance. The Bank's corporate
governance rating, which was 9.56 out of 10 and increased to 9.59 in October 2021, was maintained in 2022 as well.
TSKB signed a USD 650 million funding agreement with development finance institutions in 2022. With the “JBIC GREEN 2”
loan agreement signed in February, TSKB aims to provide financing for renewable energy and energy efficiency investments and
advanced technology-supported projects that aim to reduce greenhouse gas emissions across Türkiye. In March, the Bank signed
a USD 100 million loan agreement with the International Finance Corporation (IFC) to provide financing to companies in Türkiye
that support women's participation in employment and observe gender equality in the working environment. In December, the Bank
secured a USD 200 million “Sustainable Energy and Infrastructure Loan” from the Asian Infrastructure Investment Bank, with the
guarantee of the Republic of Türkiye Ministry of Treasury and Finance, to finance investments in renewable energy, energy efficiency,
climate change adaptation compliance, and supporting industries with a focus on climate change prevention and climate change
compliance of private sector companies in Türkiye. Also in December, the Bank signed a EUR 80 million loan agreement with the
French Development Agency (AFD) to finance investments in Türkiye that serve the circular economy and investments to be made
by companies aiming to develop circular economy practices. TSKB, which ranks first in Türkiye and is among the best banks in the
world with its ESG rating, signed its third syndication loan agreement indexed to sustainability criteria on July 25, 2022 and secured
financing amounting to USD 109 million.
TSKB is one of Türkiye’s leading institutions in the field of sustainability, taking into account the environmental and social impact
dimensions of all investment and operating loans it extends. Currently, the Bank’s loans related to Sustainable Development Goals
(SDGs) account for 91 percent of its total portfolio, while the share of loans contributing to climate and environment-related SDGs is
60 percent. In 2017, TSKB broke new ground and became the first institution in the Turkish financial sector to publish an Integrated
Report. In 2016, the Bank broke new ground in Türkiye and the CEEMEA region with its Green/Sustainable Bond issuance, and in
March 2017, the Bank issued the first subordinated sustainable bond in the world. In 2019, TSKB became a signatory to the UNEP-FI
Principles for Responsible Banking. In the same year, TSKB became the 10th member of the Management Committee of IDFC, of
which it has been a member together with leading international development banks since 2011. In October 2022, the Bank became a
signatory to the Net-Zero Banking Alliance established by the United Nations Environment Program Finance Initiative (UNEP FI) and
committed to aligning its loan and investment portfolio with zero emission targets by 2050.
www.tskb.com.tr/en
İşbank Germany
A leading financial institution backed by Turkish capital in Europe
Founded in 1992, İşbank Germany has grown and thrived within the financial system in Europe over the course of the past 30 years
and helped customers in Türkiye to access the European financial system.
Having successfully adapted to the changing dynamics throughout its operations for more than a quarter of a century, İşbank
Germany operates in Germany with 8 branches and in the Netherlands with one branch. As of December 2022, the Bank had 146
employees and EUR 1.7 billion in total assets and EUR 386 million in total shareholder equity. İşbank Germany provides finance
solutions for foreign trade transactions between Türkiye and EU member states with a focus on corporate banking.
www.isbank.de
İşbank Georgia
İşbank’s organization in Georgia
The presence of İşbank in Georgia, Türkiye’s border neighbor which is the gateway to the Caucasus, started with the branch opened
in Batumi in 2012. The Tbilisi branch became operational in 2014, and from 2015 onwards, the existing branches were transformed
into a subsidiary bank under JSC İşbank Georgia.
Mainly offering corporate banking services and having 62 employees, İşbank Georgia had total assets worth USD 156 million (GEL
420 million), and its shareholder equity amounted to USD 44 million (GEL 119 million) as of December 2022.
www.isbank.ge
İşbank Russia
Serving customers at 3 locations in Russia
İşbank has been cultivating its presence and operations in Russia, one of Türkiye’s important trade partners, since 2011.
With 97 employees on its payroll, İşbank Russia has 1 branch in Moscow, one representative office in Saint-Petersburg and one in
Kazan. Concentrated mostly on corporate banking services, İşbank Russia’s total assets were worth USD 255 million (RUB 18,263
million) and its shareholder equity was registered as USD 92 million (RUB 6,584 million) as of year-end 2022.
www.isbank.com.ru
Anadolu Hayat Emeklilik
The first publicly-traded private pension and life insurance company
Launched in 1990 as Türkiye’s first life insurer, Anadolu Hayat Emeklilik A.Ş. is also the first publicly-traded company operating in the
private pension and life insurance sector.
As of year-end 2022, the Company had total assets of TL 90.7 billion and shareholder equity of TL 3.5 billion on a consolidated basis.
At the same time, total customer assets managed by the Company in private pension and life insurance funds was TL 85.3 billion.
As of year-end 2022, Anadolu Hayat Emeklilik maintained its leadership among privately-owned companies in the categories of
number of voluntary PPS participants and fund size comprising the sum of voluntary PPS and automatic enrollment and continued to
be the company with the highest number of participants throughout the year with its private pension product “Private Pension for My
Child” for participants under the age of 18.
Focusing on a sustainable future, the Company accelerated its activities in this area and continued to generate added value in the
sector with its pioneering practices. In addition to its Sustainability Equity Fund, continued efforts to zero carbon emissions since
2016, and strong position in the BIST Sustainability Index, Anadolu Hayat Emeklilik invited everyone to be a part of the “Upcycling
Movement” with its upcycling ideas to reduce the amount of waste. It launched a corporate social responsibility project called “My
Seed Moneybox” with workshops for first and second grade primary school students living in big cities, whose relationship with
nature is limited, to make them realize that seeds are not waste but a precious treasure. In 2022, it published its second Sustainability
Report, the first of which was published in 2021.
www.anadoluhayat.com.tr/en
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 424 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 425
İşbank's Subsidiaries
İşbank's Subsidiaries
Anadolu Sigorta
Leading organization of the Turkish insurance sector
Anadolu Anonim Türk Sigorta Şirketi - one of the leading non-life insurance companies in Türkiye - generated TL 23.8 billion worth of
premiums as of year-end 2022.
The company had total assets of TL 29.4 billion and shareholder equity of TL 4.8 billion on a consolidated basis as of year-end 2022.
The Company's rating was raised from 9.55 to 9.57 in the Corporate Governance Rating Report issued in November 2022.
Anadolu Sigorta continues to be included in the BIST Sustainability Index, which it joined in 2021. In 2022, an Integrated Sustainability
Report focusing on economic, social, and environmental added value was published for the first time and CDP-Carbon Disclosure
Project Climate Change reporting was prepared, again for the first time. The Company aims to increase its portfolio in this area in the
coming periods with innovative products and services such as Electric Vehicle Motor Insurance and Individual Rooftop Solar Energy
Panel Insurance to promote renewable energy investments and low carbon emissions.
Regarding equality, one of the components of sustainable development, the #DahaEşit Gender Equality Program was launched, and an
Equality Committee was established. Awareness trainings were provided, and automatic correction of discriminatory words in emails and
office applications was initiated. The Equality Policy, which includes the Company’s commitments in this regard, was published.
www.anadolusigorta.com.tr/en
İş Leasing
Türkiye’s pioneering financial leasing company
As one of the pioneers of the leasing sector in Türkiye since its foundation in 1988, İş Finansal Kiralama A.Ş. (İş Leasing) operates with
the mission of prioritizing SMEs in its funding activities, developing and maintaining a large and high-quality portfolio, and meeting
customer demands with effective, quick and quality solutions.
İş Leasing had TL 36.3 billion in total assets and TL 3.7 billion in shareholder equity on a consolidated basis, while its leasing
receivables amounted to TL 17.2 billion as of December 2022.
In its latest report published on 26.07.2022, the international credit rating agency Fitch Ratings downgraded the credit ratings of 7
financial leasing companies and 25 Turkish banks, and updated the Company’s Long-Term Local Currency Credit Rating from B+ to
B, Long-Term Foreign Currency Credit Rating from B to B-, and Shareholder Support Rating from b to b-.
İş Leasing aims to be a part of the solution in the combat against all environmental and social problems facing the world today,
including climate change. Accordingly, the company introduced the Environmental and Social Risk Governance System (ESRG)
Project. Displaying İş Leasing's approach to sustainability, this project also defines the governance mechanisms and all necessary
processes put in place to manage the company's environmental and social impact. İş Leasing is committed to continuing its
sustainability-driven activities at full pace as a pioneering company in the sector.
İş Leasing's corporate governance rating remained unchanged in December 2022 year-on-year and maintained its level of 9.29 out
of 10.
www.isleasing.com.tr/en
Moka
All shares of Moka Ödeme Kuruluşu Anonim Şirketi, a payment services company, were purchased in January 2021, electronic money
issuance was added to the company's fields of activity as per the permission obtained from the CBRT in December 2021, and the
company's name was changed to Moka Ödeme ve Elektronik Para Kuruluşu A.Ş. at the end of the same year. As of December 2022,
the Company reached TL 468.2 million in assets with TL 46.6 million in shareholders' equity and continues its operations with 42
employees.
www.moka.com/en
Millî Reasürans
Millî Reasürans - Uninterrupted reinsurance services since 1929
Established in 1929 and having undertaken an important role in the formation and development of the Turkish insurance sector, Millî
Reasürans T.A.Ş. (Millî Reasürans) has total assets worth TL 39 billion and shareholder equity worth TL 7 billion on a consolidated
basis as of year-end 2022.
Millî Reasürans has a branch operating in Singapore in line with the Company’s strategy to export its know-how and reinsurance
experience acquired in the national market to global markets. As of year-end 2022, premiums generated abroad accounted for 23%
of the Company’s total premiums.
Since 1994, the Company has been supporting the arts and has a chamber orchestra.
www.millire.com/ing/anasayfa.html
İş Faktoring
An innovative approach to the accounts receivable factoring sector
Being one of the pioneering companies in the sector since its incorporation in 1993 with its robust financial structure and customer-
oriented approach to business, İş Faktoring A.Ş. (İş Faktoring) has been offering quick and competitive services in the areas of
finance, guarantee and collection.
As of December 2022, İş Faktoring has TL 16.4 billion in total assets and TL 1.4 billion in shareholder equity.
As a company that operates in line with the Sustainable Development Goals (SDGs) announced in 2015, a Sustainability Working
Group was established within İş Faktoring employees in June 2022 and comprehensive studies on the subject were initiated.
https://www.isfaktoring.com.tr/home-page
İş GYO
One of Türkiye’s largest real estate investment trusts
Being one of the sector’s leading actors with its solid portfolio and financial structure, İş Gayrimenkul Yatırım Ortaklığı A.Ş. (İş GYO)
focuses on maintaining and developing a diversified and well-balanced portfolio.
As of December 2022, the Company’s total assets amounted to TL 17.4 billion, and its shareholder equity totaled TL 13.9 billion.
Based on the review conducted by Saha Kurumsal Yönetim ve Kredi Derecelendirme Hizmetleri A.Ş. in August 2022, the Company’s
Long-Term National (TR) and Short-Term National (TR) ratings were affirmed as AA and A1+, respectively, with a stable outlook
assigned to both, and thus the Company was assessed within the investment category.
Sales of the Company's Topkapı İnistanbul and Ömerli Kasaba Evleri projects have been completed. Within the projects under
development, 99% of the Istanbul Finance Center project was completed, the construction of Üsküdar Altunizade (Litus Istanbul)
project is ongoing, and a new phase project is being planned in Ömerli Kasaba.
https://www.isgyo.com.tr/Home
İş Yatırım
A leading and pioneering investment house in capital markets
İş Yatırım Menkul Değerler A.Ş. (İş Yatırım) offers brokerage services in domestic and international capital markets, investment
advisory, and corporate finance services. Being one of the 7 publicly-traded brokerage houses in the sector, the Company is the only
brokerage house in Türkiye traded on BIST 100.
Having long and short-term national credit ratings of "AAA" and "A1+", respectively, as affirmed by SAHA Kurumsal Yönetim ve Kredi
Derecelendirme Hizmetleri A.Ş. on September 19, 2022, with a stable outlook, İş Yatırım had TL 35.8 billion in total assets and TL 6.8
billion in shareholder equity on a consolidated basis as of December 2022.
İş Yatırım stands out in the sector with its outstanding return on equity and the remarkable increase in its market value.
https://www.isyatirim.com.tr/en-us/pages/default.aspx
İş Portföy (İş Asset Management)
The customer portfolio of İş Portföy Yönetimi A.Ş. (İş Asset Management) mainly consists of corporate customers such as investment
funds, pension funds, venture capital funds, real estate funds, insurance companies and foundations. Pension funds managed by İş
Asset Management include Anadolu Hayat and Axa Hayat funds.
The size of the managed portfolio amounted to TL 171 billion as of December 2022, with the real estate investment fund and venture
capital investment fund reaching TL 5.6 billion and TL 3.2 billion in size, respectively.
Being one of the first portfolio management companies to set up a venture capital fund in the sector, it offers its participants a
successful return performance.
There is an exponential increase in global interest in thematic funds with a portfolio that consists of investment instruments based
on specific themes such as environmental, social and corporate governance, sustainability, clean energy and digitalization. Defining
2021 as the "Year of Transformation", İş Asset Management has gone beyond classical approaches when developing its investment
strategies, focusing on "Thematic Investment Funds" that display rapid growth and have an investment strategy based on the
transformations in business models, industries, economies or social norms. İş Asset Management divided its Thematic Funds into two
main groups: "Technology" and "Environmental, Social and Corporate Governance".
The Company offers the ability to invest in rapidly growing global sectors such as Block Chain Technologies, Cyber Security
Technologies, Digital Gaming, and Semi-Conductor Technologies.
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 426 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 427
İşbank's Subsidiaries
İşbank's Subsidiaries
When it comes to the environmental, social and corporate governance theme, the İş Asset Management Tema Variable Fund, the
İş Asset Management Electric Vehicles Mixed Fund, and the İş Asset Management Women’s Equity Fund, which promotes gender
equality in business life and offers the opportunity to invest in companies that give importance to the employment of women, are the
first of their kinds. İş Asset Management is one of the pioneering companies in the portfolio management sector in the thematic and
renewable energy area with the İş Asset Management Electric Vehicles Mixed Fund, İş Asset Management Renewable Energy Mixed
Fund, İş Asset Management Renewable Energy Venture Capital Investment Fund and İş Asset Management Infrastructure Venture
Capital Investment Fund, all set up and managed by the Company.
https://www.isportfoy.com.tr/en/Home
Software
Softtech
Experienced solution partner in information technologies
Established in İstanbul in 2006, Softtech is the largest software company in Türkiye, with more than 1,700 employees and total assets
close to TL 550 million. Besides its experience in the banking and finance sector, Softtech develops customer-oriented solutions
in the domestic and international markets with products in diverse fields and takes initiatives aimed at creating new opportunities
and collaborations with a focus on technology. The Company has offices in Ankara and Cyprus and has subsidiaries in İstanbul, San
Francisco, and Shanghai at the heart of the startup ecosystem to monitor, develop and invest in innovation on-site.
https://softtech.com.tr/en/homepage/
Health
Bayek
Bayındır Healthcare Group (Bayek), a group of companies operating in the healthcare sector with 3 hospitals, 1 medical center
and 6 dental clinics, offers quality healthcare services in İstanbul, Ankara and İzmir with its expert staff and robust technological
infrastructure.
Bayek is the first organization in Türkiye to be issued accreditation certificates for two hospitals simultaneously by the Joint
Commission International (JCI) and was re-accredited by JCI for the sixth time in November 2021.
https://www.bayindirhospitals.com/
Glass
Şişecam
The founder and the unchanging leader of the Turkish glass industry
Founded in 1935, Türkiye Şişe ve Cam Fabrikaları A.Ş. (Şişecam) has a broad portfolio of products, especially flat glass, glassware,
glass packaging and chemicals, mainly soda ash and chromium chemicals.
The Şişecam Group carries out production in facilities and plants located in Türkiye as well as in the USA, Egypt, Russia, Georgia,
Bulgaria, Bosnia-Herzegovina, Italy, Ukraine, Romania, Germany, Hungary, Slovakia and India.
Having produced 42% of the total glass output outside Türkiye (as measured on a tonnage basis) and generated 63% of total sales
revenues from facilities based abroad and exports from Türkiye as of December 2022, the Şişecam Group’s exports to more than 150
countries amounted to USD 1.1 billion as of year-end 2022.
Positioned as one of the world’s and Europe’s leading companies in the industry, the Şişecam Group was ranked between second and
fifth in the world and Europe in terms of production capacity in glass manufacturing as of December 2022.
Ranking fourth in Europe and second in the world in terms of soda production capacity, the Group is the world leader in the production
of basic chromium sulphate and ranks second in the production of sodium bichromate.
As of December 2022, Şişecam had TL 163.9 billion in total consolidated assets and TL 95 billion in shareholder equity.
Fitch Ratings downgraded the Company’s credit rating from "B+" to "B" with a "negative" outlook in the assessment made in July
2022. In Moody's assessment dated August 12, 2022, the Company's credit rating was downgraded from "B2" to "B3" and the
outlook was changed to "stable". The Company’s Corporate Governance Rating Score was 9.60 in December 2022.
Türkiye Şişe ve Cam Fabrikaları A.Ş. ranked 22nd in the ISO Türkiye's Top 500 Industrial Enterprises list for 2021.
Şişecam's installed patterned glass production capacity in Türkiye will reach 324 thousand tons/year by the end of 2024, in line with
the decision to invest in a patterned glass furnace in Mersin/Tarsus to meet the needs of the energy glass market.
In February 2022, Şişecam acquired Italian Refel S.p.A., one of the world's leading producers of refractory materials used in the
construction and maintenance of glass melting furnaces with an annual production capacity of 6 thousand tons, with the aim of
eliminating the risks associated with supply chain disruption in the AZS refractory supply processes, further strengthening its
strategic position in the European and global glass market.
Şişecam decided to invest in Basalia Technology, a groundbreaking solution in the green and circular economy space developed to
turn any kind of waste into value-added products and to support research & development projects in this area; Şişecam became
a 10% shareholder in the Swiss-based 7Cbasalia Global AG company. Basalia bio-loop technology was first used at the Şişecam
Mersin facility.
https://www.sisecam.com.tr/en
Platform
Topkapı
With its marketplace model bringing together firms of any size operating in Türkiye, Topkapı Danışmanlık Elektronik Hizmetler
Pazarlama ve Ticaret A.Ş. aims to contribute to the development of the online shopping sector in Türkiye, offer an improved customer
experience supported with next-generation, secure payment solutions by processing customer data, and develop business models
that can create maximum stakeholder value.
In addition to its payment system solutions, the company also owns the Pazarama platform, which is designed to introduce a unique
and innovative approach to the e-commerce sector for all stakeholders.
www.topkapidanismanlik.com.tr
Telecommunication
İşNet
Founded in 1999, İşNet has expanded its field of activity and range of services over the years, providing services to companies and
public institutions of all sizes in voice, data center, internet, virtual network-VPN, satellite services, digitalization solutions, security
products, and e-transformation. As of December 2022, İşNet, which continues its activities with 260 employees, will continue to
offer innovative, high value-added solutions suitable for sectoral needs with its investments in robotic process automation systems,
internet of things, cybersecurity, cloud and artificial intelligence, with the vision of becoming the "digital transformation friend" of
companies in the coming period.
https://www.isnet.net.tr/en/
Facility Management
İşmer
Within the "ISO Integrated Management System Project”, for which procedural work was initiated by İş Merkezleri Yönetim ve
İşletim A.Ş. in 2021 and whose certification audit was successfully completed in 2022, ISO 45001 Occupational Health and Safety
Standard, ISO 41001 Facility Management Standard, ISO 9001 Quality Management Standard, and ISO 14001 Environmental
Management Standard certificates have been added to the management system certificates. In the integrated management system
established, these standards are monitored from a single point.
As a result of this project, customer demands were reviewed in accordance with predefined processes, customers were provided with
the right services based on their needs, the services were regularly reviewed, and the processes that can be improved began to be
evaluated.
The study was process-oriented. and "Process improvement proposal submitted to the management" was added as a performance
parameter to each process. In addition, for processes that were directly related to customers, “Customer satisfaction rate” was added
as a performance parameter. In this way, continuous improvement is aimed in service quality and processes.
In addition, stakeholders and their needs and expectations are included in the established management system, and these needs and
expectations are regularly evaluated and reviewed.
In addition to these four essential certifications, the Company also holds ISO 50001 Energy Management System and ISO 27001
Information Security Management System certifications, which are of great importance. The Company has been the first 100%
Turkish capital company that is a member of TRFMA with 6 management system certifications.
Şişecam's investment in natural soda ash in the USA with Ciner Group is ongoing, and Şişecam is expected to become the world
leader in soda ash once the natural soda plant investments are realized.
www.ismer.com.tr
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 428 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 429
Direct and Indirect Subsidiaries
Direct and Indirect Subsidiaries*
Changes in the Portfolio of Direct and Indirect Subsidiaries between 31.12.2021-31.12.2022
DIRECT SUBSIDIARIES
Name
Anadolu Hayat Emeklilik A.Ş.
Arap Türk Bankası A.Ş.
İş Finansal Kiralama A.Ş.
İş Gayrimenkul Yatırım Ortaklığı A.Ş.
İş Merkezleri Yönetim ve İşletim A.Ş.
İş Net Elektronik Bilgi Üret. Dağ. Tic. ve İlet. Hizm. A.Ş.
İş Yatırım Menkul Değerler A.Ş.
İşbank AG
JSC Isbank Georgia
JSC İşbank
Kredi Kayıt Bürosu A.Ş.
Kültür Yayınları İş Türk A.Ş.
Milli Reasürans T.A.Ş.
Moka Ödeme ve Elektronik Para Kuruluşu A.Ş.
Trakya Yatırım Holding A.Ş.
Türkiye Sınai Kalkınma Bankası A.Ş.
Türkiye Şişe ve Cam Fabrikaları A.Ş.
31.12.2022
INDIRECT SUBSIDIARIES
Direct Share
Bank’s Risk Group
Share Percentage
Name
31.12.2022
Direct Share
Bank’s Risk Group
Share Percentage
62,00%
20,58%
27,79%
52,06%
86,33%
100,00%
65,74%
100,00%
100,00%
100,00%
9,09%
100,00%
87,60%
100,00%
100,00%
47,68%
50,93%
83,00%
20,58%
58,24%
64,84%
100,00%
100,00%
70,78%
100,00%
100,00%
100,00%
9,09%
100,00%
87,60%
100,00%
100,00%
51,37%
57,02%
Anadolu Anonim Türk Sigorta Şirketi
Anavarza Otelcilik A.Ş.
Batı Karadeniz Elektrik Dağıtım ve Tic. A.Ş.
Bayek Tedavi Sağlık Hizmetleri ve İşletmeciliği A.Ş.
Camiş Ambalaj Sanayii A.Ş.
Camiş Egypt Mining Ltd. Co.
Camiş Elektrik Üretim A.Ş.
Camiş Madencilik A.Ş.
Casaba Yönetim İşl.İmal.İth.İhr.Paz.Sağ.Tem.Güv.Ulş.Tic.ve San.A.Ş.
Sisecam Resources LP
Sisecam Resource Partners LLC
Sisecam Wyoming LLC
CJSC Brewery Pivdenna
Convera Uluslararası Yazılım Arge Teknoloji Yatırımları A.Ş.
Covision Medical Technologies Limited
Covision Medical Technologies San. Tic. A.Ş.
Cromital SPA
Efes Varlık Yönetim A.Ş.
Enaş Enerji Yatırımları A.Ş.
Erişim Müşteri Hizmetleri A.Ş.
Gullseye Lojistik Teknolojileri A.Ş.
İş Enerji Yatırımları A.Ş.
İş Faktoring A.Ş.
İş Girişim Sermayesi Yatırım Ortaklığı A.Ş.
İş Portföy Yönetimi A.Ş.
İş Sanat A.Ş.
İş Yatırım Ortaklığı A.Ş.
JSC Mina
Kanyon Yönetim İşletim ve Pazarlama A.Ş.
Kasaba Gayrimenkul İnşaat Taahhüt ve Ticaret A.Ş.
Koridor Incorporated
Livewell Giyilebilir Sağlık Ürün Hizm. A.Ş.
M4 Otelcilik ve Turizm A.Ş.
Maksmarket Danışmanlık Elektronik Hizm Tic A.Ş.
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
64,31%
50,00%
65,00%
99,90%
100,00%
99,70%
100,00%
100,00%
100,00%
74,00%
60,00%
51,00%
100,00%
100,00%
100,00%
100,00%
100,00%
100,00%
100,00%
100,00%
100,00%
100,00%
100,00%
56,78%
100,00%
100,00%
38,66%
100,00%
50,00%
100,00%
74,66%
100,00%
40,09%
95,00%
(*) Includes the direct and indirect subsidiaries in which İşbank’s share is equal to or exceeds five percentage points.
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 430 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 431
Direct and Indirect Subsidiaries*
Direct and Indirect Subsidiaries*
INDIRECT SUBSIDIARIES
Name
Maxi Digital GmbH
Maxis Girişim Sermayesi Portföy Yönetimi AŞ.
Maxis Investments Ltd.
Maxitech Inc.
Merefa Glass Company Ltd.
Mikla Yiyecek ve İçecek A.Ş.
Miltaş Turizm İnşaat Ticaret A.Ş.
Nevotek Bilişim Ses ve İletişim Sistemleri San. ve Tic. A.Ş.
Nevotek Intercorporation
Nevotek Middle East FZ Limited Liability Company
OOO Energosystems
OOO Posuda
OOO Ruscam Glass Packaging Holding
OOO Ruscam Management Company
Ortopro Tıbbi Aletler San. Tic. A.Ş.
Oxyvit Kimya Sanayii ve Ticaret A.Ş.
Pacific Soda LLC
Pasabahce Bulgaria EAD
Pasabahce Egypt Glass Manufacturing SAE
Paşabahçe (Shanghai) Trading Co. Ltd
Paşabahçe Glass Gmbh
Paşabahçe Mağazaları A.Ş.
Paşabahçe Spain SL
Paşabahçe SRL
Paşabahçe USA Inc
Radore İnternet Hizmetleri A.Ş.
Radore Veri Merkezi Hizmetleri A.Ş.
Refel SpA
Richard Fritz Prototype Spare Parts Gmbh
Rudnik Krecnjaka "Vijenac" D.O.O
SC Glass Trading BV
Sisecam Automotive Germany GmbH
Sisecam Automotive Hungary Kft
Sisecam Automotive Romania SA
Sisecam Automotive Rus JSC
Sisecam Automotive Rus Trading LLC
31.12.2022
INDIRECT SUBSIDIARIES
Direct Share
Bank’s Risk Group
Share Percentage
Name
31.12.2022
Direct Share
Bank’s Risk Group
Share Percentage
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
100,00%
100,00%
100,00%
100,00%
100,00%
83,57%
100,00%
95,37%
100,00%
100,00%
100,00%
100,00%
100,00%
100,00%
97,22%
100,00%
60,00%
100,00%
100,00%
100,00%
100,00%
100,00%
100,00%
100,00%
100,00%
25,50%
25,50%
100,00%
100,00%
50,00%
100,00%
100,00%
100,00%
100,00%
100,00%
100,00%
Sisecam Automotive Slovakia S.R.O.
Sisecam Chemicals Resources LLC
Sisecam Chemicals USA Inc
Sisecam Chemicals Wyoming LLC
Softtech (Shanghai) Technology Co. Ltd.
Softtech Ventures Teknoloji A.Ş.
Softtech Yazılım Teknolojileri Araştırma Gel. ve Paz. Tic. A.Ş.
Şişecam Automotive Bulgaria EAD
Şişecam Bulgaria EOOD
Şişecam Çevre Sistemleri A.Ş.
Şişecam Dış Ticaret A.Ş.
Şişecam Elyaf Sanayii A.Ş.
Şişecam Enerji A.Ş.
Şişecam Flat Glass India Private Limited
Şişecam Flat Glass Italy S.r.l.
Şişecam Flat Glass South Italy SRL
Sisecam Glass Packaging Investment B.V.
Şişecam Glasspackaging Hungary Kft
Şişecam Otomotiv A.Ş.
Şişecam Sigorta Aracılık Hizmetleri A.Ş.
Şişecam Soda Lukavac DOO
Şişecam Trading co.
Tatilbudur Kurumsal Hizmetler Turizm ve Ticaret A.Ş.
Tatilbudur Seyahat Acenteliği ve Turizm A.Ş.
TBC Seyahat Acenteliği ve Turizm A.Ş.
Toksöz Spor Malzemeleri Tic. A.Ş.
Topkapı Danışmanlık Elektronik Hizmetler Pazarlama ve Ticaret A.Ş.
Trakya Glass Bulgaria Ead
Trakya Glass Rus AO
Trakya Glass Rus Trading OOO
Trakya Investment BV
TRSG Glass Holding BV
TSKB Gayrimenkul Değerleme A.Ş.
TSKB Gayrimenkul Yatırım Ortaklığı A.Ş.
TSKB Sürdürülebilirlik Danışmanlığı A.Ş.
Yatırım Finansman Menkul Değerler A.Ş.
Yatırım Varlık Kiralama A.Ş.
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
100,00%
60,00%
100,00%
60,00%
100,00%
100,00%
100,00%
100,00%
100,00%
90,00%
100,00%
100,00%
100,00%
100,00%
100,00%
100,00%
100,00%
100,00%
100,00%
100,00%
100,00%
100,00%
40,09%
40,09%
40,09%
90,63%
100,00%
100,00%
100,00%
100,00%
100,00%
70,00%
100,00%
88,74%
100,00%
98,42%
100,00%
(*) Includes the direct and indirect subsidiaries in which İşbank’s share is equal to or exceeds five percentage points.
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 432 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 433
Changes in Share Percentages in Subsidiaries
COMPANIES
Companies Entering the Bank’s Risk Group in
2022
Direct Share of İşbank
as of December 2021
Direct Share of İşbank
as of December 2022
Bank's Risk Group
Share Percentage as of
December 2021
Bank's Risk Group
Share Percentage as of
December 2022
REASON
Enaş Enerji Yatırımları A.Ş.
İş Enerji Yatırımları A.Ş.
İş Sanat A.Ş.
Maksmarket Danışmanlık Elektronik Hizm Tic A.Ş.
Refel SpA
Companies Whose Share Ratio Changed in the Bank's Risk Group in 2022
Bayek Tedavi Sağlık Hizmetleri Ve İşlet
Tatilbudur Kurumsal Hizmetler Turizm ve Ticaret A.Ş.
Tatilbudur Seyahat Acenteliği ve Turizm A.Ş.
İş Gayrimenkul Yatırım Ortaklığı AŞ
Kültür Yayınları İş Türk Anonim Şirketi
Miltaş Turizm İnşaat Ticaret AŞ
TSKB Gayrimenkul Yatırım Ortaklığı AŞ
M4 Otelcilik ve Turizm A.Ş.
TBC Seyahat Acenteliği ve Turizm A.Ş.
-
-
-
-
-
0,00%
0,00%
0,00%
52,06%
99,17%
0,00%
0,00%
0,00%
0,00%
0%
0%
0%
0%
0%
0,00%
0,00%
0,00%
65,44%
100,00%
88,00%
88,85%
0,00%
0,00%
-
-
-
-
-
99,80%
40,00%
40,00%
52,06%
100,00%
0,00%
0,00%
40,00%
40,00%
100,00% Company establishment
100,00% Company establishment
100,00% Company establishment
95,00% Company establishment
100,00% Purchasing
99,90% Share purchase from a partner
40,09%
Use of preferential rights not used in the purchase of shares from cash
capital increase by the parent bank
40,09%
Use of preferential rights not used in the purchase of shares from cash
capital increase by the parent bank
64,84% Sale of shares of our Bank's group company to Borsa İstanbul
100,00% Purchase of shares of our Bank's group company
100,00% Share purchase from a partner
88,74% Sale of shares of our Bank's group company to Borsa İstanbul
40,09%
Use of preferential rights not used in the purchase of shares from cash
capital increase by the parent bank
40,09%
Use of preferential rights not used in the purchase of shares from cash
capital increase by the parent bank
Companies Removed From the Bank's Risk Group in 2022
Atlantic Soda LLC
0,00%
-
60,00%
- Merger
Companies whose Titles Changed in the Risk Group of the Bank in 2022
Former Title
New Title
Ciner Resources General Partners LLC
Sisecam Resource Partners LLC
Ciner Wyoming LLC
Sisecam Wyoming LLC
Şişecam Glass Packaging B.V.
Sisecam Glass Packaging Investment B.V.
Ciner Resources LP
Sisecam Resources LP
Change of title
Change of title
Change of title
Change of title
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen
434 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 435
İşbank Credit Ratings
Tax Breakdowns in the Countries where İşbank Operates
VII. VII. Compliance on Public Disclosure Obligations, Accuracy, Frequency and Compliance of Said Disclosures, Credit
Ratings Assigned by Rating Agencies to the Bank and Related Explanations:
As of FY2021, İşbank has reported on the taxes paid in each country it operates in. Please see below: (Thousand TL)
Tax Jurisdiction
Profit (Loss) Before
Income Tax
Income Tax Paid on
cash Basis
Income Tax Accured
Current Year
Number of Employees
Türkiye
Singapore
England
Russia
Germany
Netherlands
Georgia
Bahrain
Kosovo
Iraq
16.145.898
3.824.354
2.787.551
26.919
13.198
46.642
18.494
123.221
20.559
36.583
52.951
2.269
53.202
0
14.534
8.703
52.113
5.687
5.219
0
4.016
3.199
0
0
0
40.864
7.812
5.219
0
810
9.179
12
54
94
149
7
63
6
32
39
MOODY’S
Long-term Foreign Currency Deposit Rating
Long-term Local Currency Deposit Rating
Long-term Foreign Currency Senior Debt Rating
Short-term Foreign Currency Deposit Rating
Short-term Local Currency Deposit Rating
FITCH RATINGS
Long-term Foreign Currency Issuer Default Rating
Long-term Local Currency Issuer Default Rating
Short-term Foreign Currency Issuer Default Rating
Short-term Local Currency Issuer Default Rating
National Long-term Rating
Viability Rating
Rating
Outlook (*)
B3
B3
B3
NP
NP
B-
B
B
B
A+ (tur)
B
Stable
Stable
Stable
-
-
Negative
Negative
-
-
Negative
-
The dates on which the Bank's credit ratings/outlook were last updated are given below:
Moody’s: 16.08.2022, Fitch Ratings: 24.02.2023
(*) Outlook:
"Stable" indicates that the current rating will not be changed in the short term; "positive" indicates that the current rating is very
likely to be upgraded, and "negative" indicates that the current rating is very likely to be downgraded.
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436 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 437
Amendments to the Articles of Incorporation in 2022*
Corporate Memberships
Article No
Previous
5
Capital
New
Capital
The Company adopted the registered capital system in
accordance with the provisions of the Capital Markets
Law and switched to the registered capital system with
the permission of the Capital Markets Board dated
06.03.1997 and numbered 2683. The registered
capital ceiling of the Company is TL 10,000,000,000
(TenBillion).
The Company adopted the registered capital system in
accordance with the provisions of the Capital Markets
Law and switched to the registered capital system with
the permission of the Capital Markets Board dated
06.03.1997 and numbered 2683. The registered
capital ceiling of the Company is TL 10,000,000,000
(TenBillion).
The fully paid issued capital of the Company is TL
4,500,000,000 (fourbillionfivehundredmillion), of which
TL 1,000 is composed of Group A shares each worth 1
Kuruş, TL 29,000 is composed of Group B shares each
worth 1 Kuruş, and TL 4,499,970,000 is composed of
Group C shares each worth 4 Kuruş.
The fully paid issued capital of the Company is TL
10,000,000,000 (tenbillion), of which TL 1,000 is
composed of Group A shares, each worth 1 Kuruş, TL
29,000 is composed of Group B shares, each worth 1
Kuruş and TL 9,999,970,000 is composed of Group C
shares, each worth 4 Kuruş.
The registered capital ceiling permission granted by the
Capital Markets Board is valid for the years 2020-2024
(5 years). At the end of 2024, even if the authorized
capital ceiling has not been reached, in order for the
Board of Directors to take a capital increase decision after
2024, it is mandatory to obtain authorization from the
General Assembly for a new period not exceeding five
years by obtaining permission from the Capital Markets
Board for the previously permitted ceiling or a new
ceiling amount. In the event that the said authorization is
not obtained, no capital increase can be made with the
decision of the Board of Directors.
The registered capital ceiling permission granted by the
Capital Markets Board is valid for the years 2020-2024
(5 years). At the end of 2024, even if the authorized
capital ceiling has not been reached, in order for the
Board of Directors to take a capital increase decision after
2024, it is mandatory to obtain authorization from the
General Assembly for a new period not exceeding five
years by obtaining permission from the Capital Markets
Board for the previously permitted ceiling or a new
ceiling amount. In the event that the said authorization is
not obtained, no capital increase can be made with the
decision of the Board of Directors.
The Board of Directors is authorized to increase the
issued capital by issuing registered shares up to the
registered capital ceiling whenever it deems necessary
in accordance with the provisions of the Capital Markets
Law and the relevant legislation.
The Board of Directors is authorized to increase the
issued capital by issuing registered shares up to the
registered capital ceiling whenever it deems necessary
in accordance with the provisions of the Capital Markets
Law and the relevant legislation.
However, no new shares may be issued unless all of the
issued shares are sold and the consideration is collected.
However, no new shares may be issued unless all of the
issued shares are sold and the consideration is collected.
All shares of the Company must be issued against cash,
and all of them must be registered shares.
All shares of the Company must be issued against cash,
and all of them must be registered shares.
*Article 5 of the Articles of Incorporation was amended due to the increase in the capital of our Bank from TL 4,500,000,000 to TL
10,000,000,000 as per the registered capital ceiling.
Domestic
Foreign
The Research Institute of Banking and Commercial Law
The Institute of International Finance (IIF)
Block Chain Türkiye (BCTR)
Institut International d’Etudes Bancaires (IIEB)
Turkish Marine Environment Protection Association
(TURMEPA)
International Chamber of Commerce (ICC) Türkiye National
Committee - The Commission on Banking Techniques and Practices
Foreign Economic Relations Board of Türkiye (DEİK)
European Association for Banking and Financial History (EABH)
DEİK Türkiye - Iraq Business Council
UN Global Compact Network Türkiye
ERTA
Elginkan Community
Fintech Association (FINTR)
Global Relations Forum
United Nations Environment Program Finance Initiative (UNEP-FI)
Net-Zero Banking Alliance (NZBA)
European Association of Communication Directors (EACD)
Turkish Chamber of Commerce in China (ÇTTO)
İstanbul Foundation for Culture and Arts (İKSV)
Mobile Marketing Association - MMA Türkiye
Association of Corporate Communicators (KİD)
National Education Foundation
The Advertisers Association
The Banks Association of Türkiye (TBB)
Turkish Informatics Foundation
Economic and Social History Foundation of Türkiye (History
Foundation)
Vehbi Koç Foundation
Artificial Intelligence and Technology Association
30% Club
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 438 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 439
As of 31.12.2022, İşbank's Outstanding Loans Obtained
from International Financial Institutions
Numbers of Social Media Followers
International
Financial
Institution
Date of
Signature
Amount
Maturity
(years)
Purpose of Extending Loans
Account
Platform
Link
LinkedIn
https://www.linkedin.com/company/isbankasi
13.04.2009
€ 250,000,000
09.12.2011
€ 150,000,000
28.06.2012(1)
€ 75,000,000
12
10
12
European
Investment Bank
(EIB)
09.05.2014
€ 200,000,000
10
30.10.2015(1)
$221,200,000
01.12.2016(1)
$111,200,000
$47,600,000
27.10.2011
$6,660,000
28.06.2012(1)
€ 50,000,000
18.12.2013(1)
€ 50,000,000
30.03.2015(1)
$15,000,000
21.10.2016(1)
$55,000,000
06.12.2017(1)
$55,000,000
25.08.2022(1)
$76,000,000
$51,000,000
10
13
10
15
12
12
15
12
7
5
European
Bank for
Reconstruction
and Development
(EBRD)
1.03.2013
€ 50,000,000
10
PROPARCO
30.06.2020
€ 25,000,000
10
DFC (OPIC)
10.12.2014(1)
$220,000,000
14
Financing SMEs
Financing SMEs
Financing of energy efficiency and renewable energy projects
as part of the MidSEFF Program
Financing the loans to be extended to residential buildings
that fall under the scope of Law No. 6306 and conform to the
EIB criteria in order to improve earthquake safety and energy
efficiency in residential buildings
Financing of SMEs and enterprises with 250 to 3,000
employees
Financing of energy efficiency and renewable energy projects
as part of the MidSEFF Program
Financing of SMEs and enterprises with 250 to 3,000
employees
Financing of energy efficiency projects as part of the TurSEFF
Program
Financing of energy efficiency and renewable energy projects
as part of the MidSEFF Program
Financing of energy efficiency and renewable energy projects
as part of the MidSEFF Program
Financing of energy efficiency in residences as part of the
TurEEFF Program
Financing of energy efficiency and renewable energy projects
as part of the MidSEFF Program
Financing of renewable energy and resource efficiency
investments as part of the TurSEFF Program
Financing women entrepreneurs under the second phase of
the Women in Business (TurWIB) Program
Financing renewable energy, energy efficiency, and resource
efficiency projects under the third phase of the TurSEFF Program
Financing of loans extended to residential buildings conforming
to domestic energy efficiency criteria in Türkiye
Financing agriculture and the energy and resource efficiency
activities of small and medium-sized companies operating in
the agricultural sectors
Financing of SMEs, prioritized regions in development, and
women entrepreneurs
$105,000,000
Financing of housing loans, including green mortgages
conforming to IFC energy efficiency criteria
28.12.2017(1)
IFC
$20,000,000
25.08.2022(1)
$100,000,000
12.09.2022
$100,000,000
Asian
Infrastructure
Investment Bank
(AIIB)
9
5
5
Financing "green mortgage" loans ensuring energy efficiency
with the fund provided by the Clean Technology Fund ("CTF")
through IFC
Financing of housing loans, including green mortgages
conforming to IFC energy efficiency criteria
Financing SMEs and small-scale corporate firms affected by
the COVID-19 pandemic
(1) Funding obtained through the transactions made within the scope of the diversified payment rights securitization program based on cash flows.
Türkiye İş Bankası A.Ş.
Youtube
https://www.youtube.com/c/işbankası
Twitter
https://twitter.com/isbankasi
Facebook
https://www.facebook.com/isbankasi
Instagram https://www.instagram.com/isbankasi/
Tiktok
https://www.tiktok.com/@isbankasi
LinkedIn
-
Youtube
https://www.youtube.com/c/iscep
İşcep
Twitter
https://twitter.com/iscepisbankasi
Facebook
https://www.facebook.com/iscep
Instagram https://www.instagram.com/iscepisbankasi/
LinkedIn
-
Youtube
https://www.youtube.com/user/maximumkart
Maximum
Twitter
https://twitter.com/MaximumKart
Facebook
https://www.facebook.com/maximum
Instagram https://www.instagram.com/maximumkart/
LinkedIn
-
Youtube
https://www.youtube.com/c/MaximilesKart
Maximiles
Twitter
https://twitter.com/MaximilesKart
Facebook
https://www.facebook.com/MaximilesKart
Instagram https://www.instagram.com/maximileskart/
LinkedIn
https://www.linkedin.com/company/isbankworkup/
Youtube
https://www.youtube.com/c/Workup%C4%B0%C5%9FBankas%C4%B1
Workup
Twitter
https://twitter.com/workupisbankasi
Facebook
https://www.facebook.com/workupisbankasi
Instagram https://www.instagram.com/workupisbankasi/
LinkedIn
-
Youtube
https://www.youtube.com/c/maximumgenc
Maximum Youth
Twitter
https://twitter.com/maximumgenc
Facebook
https://www.facebook.com/maximumgenc
Instagram https://www.instagram.com/maximumgenc/
Total
Number of
Followers
141,641
45,200
229,375
628,321
138,208
15,712
-
6,270
60,061
413,540
75,164
-
23,700
57,560
349,637
48,422
-
401
31,814
136,081
17,633
7,643
2,360
10,124
17,967
11,170
-
6,150
25,257
185,358
13,941
2,698,710
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 440 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 441
Human Resources Data
Human Resources Data
Total Number of Employees✓
Number of Employees✓
Female
Male
Number of Employees Covered by Collective Bargaining
Agreements
Female
Male
Number of Employees by Employment Type✓
Full-time
Partial Time
Part-time
Part-Time
Total
Number of Employees by Region and Branch
Head Office
Branch
Region
Total
Number of Employees by Gender and Age Upper
Management (Members of the Board of Directors and
Executive Committee)
50 years of age and older
30-50 years of age
30 years of age and younger
2020
23.518
11,907
11,611
11,432
11,702
2020
23,381
135
2
0
2021
22.802
11,506
11,296
11,309
11,126
2021
22,678
123
1
0
2022
23.309
11,782
11,527
11,455
11,266
2022
23,148
137
1
23
23,518
22,802
23,309
2020
7,022
15,733
763
23,518
2021
7,083
14,968
751
22,802
2022
7,562
15,034
713
23,309
2020
2021
2022
Female
Male
Female
Male
Female
Male
3
15
2
3
0
0
3
16
0
5
0
0
4
18
0
4
0
0
Employees in Management Positions
(Division Manager and above)
50 years of age and older
2020
2021
2022
Female
Male
Female
Male
Female
Male
30-50 years of age
30 years of age and younger
Total
Breakdown of Employees by Age
50 years of age and older
30-50 years of age
30 years of age and younger
Total
Number of Employees by Seniority
0-4.99 years
5-9.99 years
10+ years
Total
Employee Turnover Rate (%)✓
Key Personnel Turnover Rate (%)
Breakdown of Employees by Educational Background
Primary School
High School
College (2 or 3-year Associate Degree)
University (4-year College)
Post Graduate
PhD Degree
Total
8
27
7
37
0
0
79
2020
492
21,417
1,609
23,518
2020
1,935
4,146
17,437
23,518
1.60
NA
2020
57
3,516
534
18,262
1,127
22
8
29
8
37
0
0
82
2021
686
20,914
1,202
22,802
2021
1,609
3,314
17,879
22,802
2.01
NA
2021
44
3,299
523
17,815
1,100
21
7
32
10
35
0
0
84
2022
961
20,272
2,076
23,309
2022
2,358
3,230
17,721
23,309
1.90
16.05
2022
36
3,125
528
18,470
1,128
22
23,518
22,802
23,309
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442 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 443
Human Resources Data
Human Resources Data
Number of Employees Eligible for Parental Leave
2019
2020
2021
2022
Number of Employees Eligible for Parental Leave
Number of female employees
Number of male employees
12,252
11,801
11,907
11,611
11,506
11,296
11,782
11,527
Occupational Health and
Safety Data
Injury Rate✓
Direct Employment
2019
2020
2021
2022
Contractor Employees
Numbers of Employees Taking and Returning
From Maternity Leave✓
Number of Female Employees Eligible for Maternity Leave
Number of Female Employees Returning to Work from Maternity Leave
Rate of Return from Maternity Leave (%)
Retention Rate After Maternity Leave (%)
Number of Male Employees Whose Wife Took Maternity Leave
Total Employment Created with Subsidiaries
Number of Subsidiaries Under Our Control
780
1,072
99.5
96.2
734
2019
111
642
880
99.7
96.5
580
2020
106
592
758
99.9
98.2
550
2021
109
499
692
99.7
98.5
443
2022
113
Number of Employees in Subsidiaries
34,207
34,390
35,973
39,184
Employee Trainings*✓
Average Annual Training Hours Per Employee
Average Annual Training Hours Per Female Employee
Average Annual Training Hours Per Male Employee
2019
2020
25.7
22.3
29.9
25.4
23.2
28.1
2021
29.3
26.7
32.7
2022
43
39.5
47.5
* Training figures exclude participants of refresher trainings, and Private Security Officers and Servant Staff are also not included.
Employee Trainings
2019
2020
2021
2022
Anti-Bribery and Anti-Corruption Training✓
Number of Trainees
Person*Hours
Ethical Principles Training✓
Number of Trainees
Person*Hours
Human Rights Training✓
Number of Trainees
Person*Hours
Sustainability Training*✓
Number of Trainees
Person*Hours
Sustainability E-Training✓
Number of Trainees
Person*Hours
**Includes sustainability e-training man*hour data.
7,577
3,115
664
506
260
733
538
4,760
-
-
7,830
857
438
331
128
315
5,716
627
2,214
1,305
272
727
17,015
2,130
2,700
1,480
2,019
4,887
1,552
5,946
8,637
14,392
12,291
27,994
-
-
775
388
2,110
981
Female
Male
Female
Male
Occupational Disease Rate
(ODR)✓
Direct Employment
Contractor Employees
Female
Male
Female
Male
Number of Occupational
Diseases✓
Direct Employment
Contractor Employees
Lost Day Rate (LDR)✓
Direct Employment
Contractor Employees
Days of Absence Due to
Accident✓
Direct Employment
Contractor Employees
Female
Male
Female
Male
Female
Male
Female
Male
Female
Male
Female
Male
2021
2022
Absentee Rate (AR)✓
Direct Employment
2021
2022
0,000079
0,000045
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
1,98
1,49
0,49
0
0
0
444
335
109
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
1,12
0,50
0,62
0
0
0
263
118
145
0
0
0
Female
0,00006
0,000020
Male 0,000019
0,000025
Contractor Employees
Female
Male
Number of Work-related
Fatalities✓
Direct Employment
Contractor Employees
Female
Male
Female
Male
Number of Fatal Incidents✓
Direct Employment
Contractor Employees
Number of Incidents✓
Direct Employment
Contractor Employees
Female
Male
Female
Male
Female
Male
Female
Male
Accident Frequency Rate*✓
Direct Employment
Female
Male
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
46
32
14
0
0
0
0,20
0,14
006
Number of Employees Carrying
Out Tasks with a High Risk of
Occupational Diseases✓
Direct Employment
Contractor Employees
0
0
* Accident frequency rate: Total number of incidents /
(Total working hours - Lost hours)*200,000
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
61
39
22
0
0
0
0,26
0,17
0,09
0
0
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen
444 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 445
Summary Financial Highlights and
Key Ratios for the Five-Year Period
Summary Financial Highlights and
Key Ratios for the Five-Year Period
2018/12
2019/12
2020/12
2021/12
2022/12
KEY RATIOS
2018/12
2019/12
2020/12
2021/12
2022/12
4,888,627
5,661,559
9,463,666
15,170,894
16,145,165
Interest Earning Assets (9) / Total Assets
89.3%
89.0%
89.8%
89.3%
88.2%
43,630,394
60,525,991
77,492,256
190,881,628
205,819,117
Interest Earning Assets (9) / Interest Bearing
Liabilities
109.4%
109.0%
109.9%
106.4%
112.4%
NON-CONSOLIDATED
68,133,659
84,246,760
109,485,041
142,653,302
278,281,335
Securities / Total Assets
NON-CONSOLIDATED
ASSETS (TL Thousand)
Cash
Receivables from Banks and Interbank Money
Markets (1)
Securities (Net) (2)
Loans (3)
Partnership Investments (Subsidiaries and
Affiliates) (Net)
Fixed Assets (Net)
Other Assets (4)
Total Assets
260,316,291
270,360,084
345,150,130
493,378,191
759,289,191
17,638,720
21,070,554
26,002,383
39,461,345
79,859,474
5,996,958
8,478,257
9,161,214
11,277,602
22,312,006
15,782,955
17,716,266
17,147,742
33,746,062
46,616,380
416,387,604
468,059,471
593,902,432
926,569,024 1,408,322,668
LIABILITIES (TL Thousand)
2018/12
2019/12
2020/12
2021/12
2022/12
Deposits
245,268,846
295,922,002
368,876,491
595,628,376
931,077,289
Funds Borrowed and Money Markets (5)
94,468,343
86,102,534
116,407,089
181,993,730
173,427,490
Provisions
Other Liabilities
Shareholders' Equity
Total Liabilities
6,256,462
7,042,357
10,224,590
15,487,318
30,539,092
20,673,329
20,119,113
30,612,810
46,620,309
81,902,722
49,720,624
58,873,465
67,781,452
86,839,291
191,376,075
416,387,604
468,059,471
593,902,432
926,569,024 1,408,322,668
INCOME/EXPENSE ITEMS (TL Thousand)
2018/12
2019/12
2020/12
2021/12
2022/12
Interest Income (6)
Interest Expenses (6)
Net Interest Income
Net Trading Profit/Loss
38,840,381
43,042,350
42,516,332
60,904,343
123,454,753
21,788,130
23,183,222
17,274,293
29,963,074
48,251,300
17,052,251
19,859,128
25,242,039
30,941,269
75,203,453
-4,071,660
-6,397,400
-3,341,357
-5,149,127
4,522,593
Net Fees and Commissions Income
4,405,201
5,569,128
5,617,613
7,619,945
16,146,898
Dividend Income
Other Operating Income
Total Operating Income
Operating Expenses (7)
6,425
9,098
21,487
20,735
38,604
1,912,307
3,146,751
2,436,205
4,401,570
6,080,548
19,304,524
22,186,705
29,975,987
37,834,392
101,992,096
8,039,721
9,792,544
11,796,986
15,911,689
34,029,278
Loans / Total Assets
Loans / Deposits
Personal Loans / Total Loans
NPL Ratio
Coverage Ratio
Demand Deposits / Total Deposits
Shareholders’ Equity / Total Liabilities
Capital Adequacy Standard Ratio
Return on Average Assets (10)
Return on Average Equity (10)
OPEX / Operating Income (11)
16.4%
62.5%
106.1%
22.4%
4.1%
58.7%
24.4%
11.9%
16.5%
1.7%
14.8%
36.4%
18.0%
57.8%
91.4%
23.6%
6.5%
54.7%
28.4%
12.6%
17.9%
1.4%
11.4%
39.2%
18.4%
58.1%
93.6%
25.0%
5.6%
63.7%
41.7%
11.4%
18.7%
1.3%
10.9%
35.3%
15.4%
53.2%
82.8%
22.2%
4.1%
66.2%
47.9%
9.4%
20.4%
1.9%
18.4%
34.7%
19.8%
53.9%
81.5%
23.3%
3.0%
74.4%
45.5%
13.6%
24.4%
5.3%
46.8%
27.5%
OTHER INFORMATION (TL Thousand)
2018/12
2019/12
2020/12
2021/12
2022/12
Regulatory Capital
Core Capital
Free Capital (12)
Demand Deposits
58,950,530
69,198,849
84,540,460
116,325,684
229,090,694
49,052,634
57,971,231
66,666,192
90,161,889
192,857,543
29,896,338
30,903,681
38,469,439
46,673,837
120,650,947
59,961,577
84,040,178
153,998,446
285,308,452
423,357,161
(1) Includes balances at the Central Bank and Required Reserves.
(2) 2019/12, 2020/12 and 2021/12 periods do not include the loan balance granted to the special purpose entity, which is classified under Other Financial Assets at Fair Value
Through Profit and Loss.
(3) Excludes Non-performing Loans. 2018/12 period includes the loan balance granted to the special purpose entity, which is classified under Other Financial Assets at Fair Value
Through Profit and Loss.
(4) 2019/12, 2020/12 and 2021/12 periods include the loan balance granted to the special purpose entity, which is classified under Other Financial Assets at Fair Value Through
Profit and Loss.
(5) Includes Turkish Lira and foreign currency debt instruments issued and subordinated debts.
NET OPERATING PROFIT/LOSS (8)
11,264,803
12,394,161
18,179,001
21,922,703
67,962,818
(6) Fees and Commissions Received from Cash Loans are shown in Interest Income, Fees and Commissions Given to Cash Loans are shown in Interest Expenses.
Provision for Losses on Loans and Other
Receivables
Profit/Loss from Subsidiaries Based on Equity
Method
6,343,674
8,325,906
12,729,920
14,450,167
15,804,444
(7) Includes Personnel Expenses.
(8) Net Operating Profit / Loss = Total Operating Income - Operating Expenses
(9) Interest Earning Assets include Turkish Lira and foreign currency required reserves.
2,808,736
2,806,196
3,406,471
8,003,345
21,790,674
(10) Averages calculated based on quarterly balances.
(11) Operating Income = Total Operating Income + Profit/Loss from Subsidiaries Based on Equity Method
(12) Free Capital = Shareholders’ Equity - (Fixed Assets + Non-Financial Associates and Subsidiaries + Net Non-performing Loans)
PROFIT/LOSS BEFORE TAXES
7,729,865
6,874,451
8,855,552
15,475,881
73,949,048
Provision for Taxes
960,780
806,864
2,044,635
2,007,986
12,411,168
NET PERIOD PROFIT/LOSS
6,769,085
6,067,587
6,810,917
13,467,895
61,537,880
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 446 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 447
Summary Financial Highlights and Key Ratios
for the Five-Year Period
Summary Financial Highlights and Key Ratios
for the Five-Year Period
CONSOLIDATED
ASSETS (TL Thousand)
Cash
Receivables from Banks and Interbank Money Markets
(1)
2018/12
2019/12
2020/12
2021/12
2022/12
4,931,787
5,700,435
9,504,086
15,230,787
16,263,472
51,202,701
70,109,172
87,017,464 206,978,744 230,772,584
Securities (Net) (2)
77,942,727
97,304,703 128,082,066
173,820,212 342,656,590
Loans, Factoring Receivables and Lease Receivables (3) 303,495,889 316,028,505 403,934,870 590,297,628
885,150,975
Partnership Investments (Subsidiaries and Affiliates)
(Net)
Fixed Assets (Net)
Other Assets (4)
Total Assets
9,418,560
11,190,991
13,052,096
21,918,409
42,870,444
11,975,301
13,826,688
14,706,181
19,101,836
41,497,115
40,940,392
50,891,344
61,855,500
97,056,457
156,220,389
499,907,357
565,051,838
718,152,263 1,124,404,073 1,715,431,569
LIABILITIES (TL Thousand)
2018/12
2019/12
2020/12
2021/12
2022/12
Deposits
248,981,402
302,791,204 381,693,393
617,679,203 952,635,932
OTHER INFORMATION (TL Thousand)
2018/12
2019/12
2020/12
2021/12
2022/12
Regulatory Capital
Core Capital
Free Capital (12)
Demand Deposits
64,189,820
75,055,619
90,577,700
125,734,035
237,561,370
51,413,549
60,581,141
69,037,761
93,801,462
198,553,596
28,971,576
31,093,535
38,572,660
46,881,642
119,423,191
61,655,721
86,043,036
157,339,437
291,867,150
431,703,325
(1) Includes balances at the Central Bank and Required Reserves.
(2) 2019/12, 2020/12 and 2021/12 periods do not include the loan balance granted to the special purpose entity, which is classified under Other Financial Assets at Fair Value
Through Profit and Loss.
(3) Excludes Non-performing Loans. 2018/12 period includes the loan balance granted to the special purpose entity, which is classified under Other Financial Assets at Fair Value
Through Profit and Loss.
(4) 2019/12, 2020/12, and 2021/12 periods include the loan balance granted to the special purpose entity, which is classified under Other Financial Assets at Fair Value Through
Profit and Loss.
(5) Includes Turkish Lira and foreign currency debt instruments issued and subordinated debts.
(6) Fees and Commissions Received from Cash Loans are shown in Interest Income, Fees and Commissions Given to Cash Loans are shown in Interest Expenses.
Funds Borrowed and Money Markets (5)
137,945,969
130,065,019
167,635,067 272,909,829 299,862,793
(7) Includes Personnel Expenses.
Provisions
Other Liabilities
Shareholders' Equity
Total Liabilities
15,161,685
17,860,585
24,027,066
35,609,317
67,292,475
42,203,408
48,633,563
69,935,017
102,037,545
185,587,676
55,614,893
65,701,467
74,861,720
96,168,179 210,052,693
499,907,357
565,051,838
718,152,263 1,124,404,073 1,715,431,569
INCOME/EXPENSE ITEMS (TL Thousand)
2018/12
2019/12
2020/12
2021/12
2022/12
Interest Income (6)
Interest Expenses (6)
Net Interest Income
Net Trading Profit/Loss
44,078,656
48,453,830
47,960,977
69,449,187
140,591,973
24,492,384
25,654,752
18,898,262
32,530,364
54,160,597
19,586,272
22,799,078
29,062,715
36,918,823
86,431,376
-2,293,686
-4,633,920
-1,206,769
703,452
19,477,788
Net Fees and Commissions Income
3,756,035
4,611,770
4,919,413
6,691,855
14,671,415
Dividend Income
Other Operating Income
Total Operating Income
Operating Expenses (7)
19,655
20,819
31,057
68,548
263,526
8,120,963
10,942,888
11,733,929
16,883,690
32,573,886
29,189,239
33,740,635
44,540,345
61,266,368
153,417,991
14,656,126
17,512,911
21,179,158
30,381,409
59,881,644
NET OPERATING PROFIT/LOSS (8)
14,533,113
16,227,724
23,361,187
30,884,959
93,536,347
Provision for Losses on Loans and Other Receivables
7,012,853
9,236,283
14,150,040
16,810,490
19,231,075
Profit/Loss from Subsidiaries Based on Equity Method
1,569,036
1,462,479
1,455,956
4,874,850
10,205,448
PROFIT/LOSS BEFORE TAXES
Provision for Taxes
NET PERIOD PROFIT/LOSS
CONSOLIDATED
KEY RATIOS
Interest Earning Assets (9) / Total Assets
Interest Earning Assets (9) / Interest Bearing Liabilities
Securities / Total Assets
Loans / Total Assets
Loans / Deposits
Personal Loans / Total Loans
NPL Ratio
Coverage Ratio
Demand Deposits / Total Deposits
Shareholders’ Equity / Total Liabilities
Capital Adequacy Standard Ratio
Return on Average Assets (10)
Return on Average Equity (10)
OPEX / Operating Income (11)
9,089,296
8,453,920
10,667,103
18,949,319
84,510,720
1,517,912
1,422,289
2,915,351
3,389,061
15,453,038
7,571,384
7,031,631
7,751,752
15,560,258
69,057,682
2018/12
2019/12
2020/12
2021/12
2022/12
86.4%
111.7%
15.6%
59.1%
118.6%
19.8%
4.1%
56.5%
24.8%
11.1%
15.3%
1.6%
14.8%
35.9%
85.8%
112.0%
17.2%
54.5%
101.6%
20.8%
6.4%
53.5%
28.4%
11.6%
16.4%
1.3%
11.8%
39.8%
86.2%
112.7%
17.8%
54.6%
102.7%
22.1%
5.6%
62.1%
41.2%
10.4%
17.0%
1.2%
11.2%
36.0%
86.2%
108.9%
15.5%
50.9%
92.6%
19.3%
4.1%
65.0%
47.3%
8.6%
18.7%
1.8%
19.2%
34.5%
84.2%
115.4%
20.0%
49.7%
89.4%
20.8%
3.1%
75.6%
45.3%
12.2%
21.8%
4.9%
48.1%
27.5%
(8) Net Operating Profit / Loss = Total Operating Income - Operating Expenses
(9) Interest Earning Assets include Turkish Lira and foreign currency required reserves.
(10) Averages calculated based on quarterly balances.
(11) Cost and income are netted against “Insurance Technical Income / Expense”. Operating Income = Total Operating Income + Profit/Loss from Subsidiaries Based on Equity
Method
(12) Free Capital = Shareholders’ Equity - (Fixed Assets + Non-Financial Associates and Subsidiaries + Net Non-performing Loans)
UN Women's Empowerment Principles Progress Statement
PRINCIPLES
GRI STANDARDS
RELATED SECTION
Principle 1 - Corporate Leadership Supporting
Gender Equality
405-1, 405-2
Principle 2 - Equal Opportunity, Participation and
Anti-discrimination
202-1, 401-1, 401-3, 405-1, 405-2, 406-1
Principle 3 - Health, Safety and Freedom from
Violence
406-1
Principle 4 - Education and Training
404-1; 404-3
Principle 5 - Business Development, Supply
Chain and Marketing Practices
204-1; 103-1; 103-2; 103-3
Principle 6 - Community Leadership and
Participation
413-1
Principle 7 - Measurement and Transparent
Reporting for Gender Equality
405-1; 405-2; 103-1; 103-2; 103-3
Message from the General
Manager, Initiatives Supported in
the Field of Sustainability, Equal
Opportunity and Diversity
Equal Opportunity, Diversity,
Gender Equality
Equal Opportunity, Diversity,
Gender Equality, Employee Health
and Safety
Equal Opportunity, Diversity,
Gender Equality, Talent
Management
Supply Chain Management,
Business Ethics
Initiatives Supported in the Field of
Sustainability
Equal Opportunity, Diversity,
Gender Equality
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 448 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 449
Independent Auditor’s Report on the Annual Report
of the Board Of Directors
Independent Auditor’s Report on the Annual Report
of the Board Of Directors
To the General Assembly of Türkiye İş Bankası Anonim Şirketi
1. Qualified Opinion
We have audited the annual report of Türkiye İş Bankası A.Ş. (“the Bank”) and its subsidiaries (“the Group”) for the period of January 1,
2022 – December 31, 2022.
In our opinion, except for the matter described in the Basis for Qualified Opinion section of our reports, the consolidated and
unconsolidated financial information provided in the annual report of the Board of Directors and the discussions made by the Board of
Directors on the situation of the Group are presented fairly and consistent, in all material respects, with the audited full set consolidated
and unconsolidated financial statements and the information we obtained during the audit.
2. Basis for Qualified Opinion
As described in the Basis For Qualified Opinion section of Independent Auditor’s Reports on the complete set of audited unconsolidated
and consolidated financial statements of the Bank and the Group for the period between January 1, 2022 and December 31, 2022 dated
February 6, 2023 and February 7, 2023 on the unconsolidated and consolidated financial statements respectively, as at December 31,
2022 include a free provision at an amount of TL 8,475,000 thousands of which TL 4,075,000 thousands was provided in prior years
and TL 4,400,000 thousands provided in the current period by the Bank and the Group management for the possible effects of the
negative circumstances which may arise from the possible changes in the economy and market conditions which does not meet the
recognition criteria of “Turkish Accounting Standard” (TAS) 37 “Provisions, Contingent Liabilities and Contingent Assets”.
We conducted our audit in accordance with “Regulation on independent audit of the Banks” published in the Official Gazette no.29314
dated April 2, 2015 published by Banking Regulation and Supervision Agency (BRSA Independent Audit Regulation) and Independent
Auditing Standards (InAS) which are part of the Turkish Auditing Standards as issued by the Public Oversight Accounting and Auditing
Standards Authority of Turkey (POA). Our responsibilities under those standards are further described in the Auditor’s Responsibilities
for the Audit of the Annual Report section of our report. We are independent of the Group in accordance with the Code of Ethics for
Independent Auditors (Code of Ethics) as issued by the POA, and we have fulfilled our other ethical responsibilities in accordance with
the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified
opinion.
3. Our Auditor’s Opinion on the Full Set Consolidated and Unconsolidated Financial Statements
We have expressed qualified opinions in our auditor’s reports dated February 6, 2023 and February 7,2023 on the full set
unconsolidated and consolidated financial statements of the Group for the period of 1/1/2022-31/12/2022 respectively.
4. The Responsibility of the Board of Directors on the Annual Report
In accordance with Articles 514 and 516 of the Turkish Commercial Code 6102 (“TCC”) and communique on ‘Principles and procedures
set out by the regulations on preparation and issuance of annual reports of Banks’, the management of the Group is responsible for the
following items:
a. Preparation of the annual report within the first three months following the balance sheet date and submission of the annual report to
the general assembly
b. Preparation and fair presentation of the annual report; reflecting the operations of the Group for the year, along with its financial
position in a correct, complete, straightforward, true and honest manner. In this report, the financial position is assessed according to
the consolidated and unconsolidated financial statements. The development of the Group and the potential risks to be encountered
are also noted in the report. The evaluation of the board of directors is also included in this report
c. The annual report also includes the matters below:
ੵ Subsequent events occurred after the end of the fiscal year which have significance,
ੵ The research and development activities of the Group,
ੵ Financial benefits such as salaries and bonuses paid to the board members and to those charged governance, allowances, travel,
accommodation and representation expenses, financial aids and aids in kind, insurances and similar deposits.
ੵ Other matters prescribed in the communique on ‘Principles and procedures set out by the regulations on preparation and issuance of
annual reports of Banks’ published in official gazette no.26333 dated November 1, 2006.
When preparing the annual report, the board of directors takes into account the secondary legislative arrangements published by the
Ministry of Trade and related institutions
5. Auditor’s Responsibilities for the Audit of the Annual Report
Our aim is to express an opinion, based on the independent audit we have performed on the annual report in accordance with provisions
of the Turkish Commercial Code and the Communique on ‘Principles and procedures set out by the regulations on preparation
and issuance of annual reports of Banks’ published in official gazette no.26333 dated November 1, 2006 , Banking Regulation and
Supervision Agency (“BRSA”) Accounting and Financial Reporting Legislation which includes, “Regulation on Accounting Applications
for Banks and Safeguarding of Documents” published in the Official Gazette no.26333 dated 1 November 2006 and other regulations
on accounting records of Banks published by Banking Regulation and Supervision Agency (BRSA) and Turkish Financial Reporting
Standards (“TFRS”) for those matters not regulated by the aforementioned regulations, on whether the consolidated and unconsolidated
financial information provided in this annual report and the discussions of the Board of Directors are presented fairly and consistent with
the Group’s audited consolidated and unconsolidated financial statements and to prepare a report including our opinion.
The independent audit we have performed is conducted in accordance with InAS and BRSA Independent Audit Regulation. These
standards require compliance with ethical provisions and the independent audit to be planned and performed to obtain reasonable
assurance on whether the consolidated and unconsolidated financial information provided in the annual report and the discussions
of the Board of Directors are free from material misstatement and consistent with the consolidated and unconsolidated financial
statements.
The name of the engagement partner who supervised and concluded this audit is Fatma Ebru Yücel.
8 Mart 2023
İstanbul, Türkiye
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 450 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 451
Reporting Guidance
Environmental Indicators
Total Energy Consumption (GJ)
Total energy consumption including energy sources covers electricity natural gas, fuel-oil, coal and diesel
consumption figures. Electricity consumption was initially calculated in kWh and then converted to GJ. In this
conversion, 1 kWh = 0.0036 GJ conversion factor was used. After calculating monthly natural gas consumption
in m3, monthly coal consumption in kg, monthly fuel-oil and consumption in lt in 2022, it was converted to kWh
by using the monthly-based lower heat values on the invoices. The annual total consumption is calculated by
summing these monthly consumptions. Annual total consumption was converted to GJ using the conversion
factor mentioned above and added to the total energy consumption. Reporting boundary for this KPI covers
Turkey operations of İş Bankası.
Greenhouse Gas Emissions ı
Greenhouse gas emissions refer to carbon emissions from energy consumption during the reporting period.
ੵ Scope 1 Emissions (tCO2e)
ੵ Scope 2 Emissions (tCO2e)
ੵ Scope 3 Emissions (tCO2e)
Greenhouse gas emissions resulting are calculated in accordance with The Greenhouse Gas Protocol: A Revised
Corporate Accounting and Reporting Standard by Demir Energy, a firm offering strategy, management and
reporting services in the area of sustainability
Greenhouse gas emissions are calculated in 3 different scopes: Scope 1 (Direct Greenhouse Gas Emissions),
Scope 2 (Indirect Greenhouse Gas Emissions) and Scope 3 (Other Indirect Greenhouse Gas Emissions).
IPCC 5th Assessment Report factors were used for emission factors. Network Emission Factor has been
calculated in accordance with the data provided by TEİAŞ. Direct greenhouse gas (GHG) emissions (Scope 1)
and indirect energy greenhouse gas (GHG) emissions (Scope 2) were made according to the GHG Protocol –
According to location-based criterion.
Other indirect greenhouse gas (GHG) emissions (Scope 3) are reported according to the GHG Protocol. DEFRA
emission factors were used for air travel emissions and Environmental Paper Network emission factors were used
for paper consumption.
While calculating greenhouse gas emissions, the following sources causing carbon emissions were considered:
Scope 1 Emissions*:
ੵ Natural gas, diesel, LPG, fuel oil and coal consumption for heating purposes,
ੵ Fuels used in generators (Diesel),
ੵ Company vehicles fuel Consumption (Diesel and Gasoline)
ੵ Refrigerants (Leaks reported during installation and maintenance phases are taken into account)
Scope 2 Emissions*:
ੵ Electricity Consumption
Scope 3 Emissions*:
ੵ Fuel consumption of Personnel Service Vehicles
ੵ Local Business Travels (Flight, Bus, Taxi)
ੵ International Business Travels (Flight, Bus, Taxi)
ੵ Fuel consumption of Private Car Used for Business Purposes
ੵ Paper Consumption
* Reporting boundary for this KPI covers Turkey operations of İş Bankası.
* The impact of remote working is not included in the resource consumption and emission calculations in the reporting period.
Fuel consumption of vehicles
ੵ Fuel consumption by personnel
service vehicles (Lt)
ੵ Fuel consumption by personel
vehicles (Lt)
ੵ Fuel consumption by company
vehicles (Lt)
Personnel service vehicles include the vehicles transporting İş Bankası employees at İş Kuleleri Kule 1, ATOM,
TUTOM and branches. Fuel consumption was calculated over total distance figures, provided by the supplier
firm, transporting İş Bankası employees.
Fuel consumption by personal vehicles: Personal vehicles include the vehicles used for business purposes by
the working personnel in the Headquarters buildings (Business Towers Tower 1, ATOM, TUTOM and ATLAS
buildings) and in all stores.
Company vehicles cover all vehicles in the Bank's fleet also including transportation vehicles. Fuel consumption
data by those vehicles was provided by the supplier firm.
Total Water Consumption (m3)
ੵ Total municipal water
consumption (m3)
ੵ Total rainwater
(recovered/reused) (m3)
ੵ Total drinking water
consumption (m3)
ੵ Total wastewater production (m3)
Emission Intensities
ੵ Emissions Per Employee (tCO2 e/
Number of Employees)
ੵ Emissions by Consolidated Asset
Size (tCO2e/million TL)
ੵ Emissions by Consolidated Asset
Size (tCO2e/million USD)
ੵ Emissions by Consolidated Net
Profit (tCO2e/ million TL)
ੵ Emissions by consolidated net
profit (tCO2e/million USD)
ੵ USD Balance Sheet Rate
Total amount of waste recycled
(tons)
ੵ Amount and types recycled
hazardous waste
ੵ Amount and types of recycled
non-Hazardous Waste
ੵ Amount of recycled paper
Municipal water and rainwater are used locally in Türkiye operations. The reporting scope includes the total
amount of water used and withdrawn for consumption purposes.
Water consumption is evaluated in 3 different categories as Municipal water, Rainwater and Drinking water.
The amount of water purchased from municipalities or other operating systems such as İSKİ is included in
the total municipal water. Consumption values are followed from invoices and prepaid counters located in the
buildings. Consumptions at all locations are tracked and reported throughout the year.
For a small number of (28) service buildings whose water consumption amounts could not be determined in any
way, estimated consumption value information was calculated based on the number of employees in accordance
with the TS1258 standard.
Rainwater is collected and filtered through the rainwater collection channels installed in the Headquarters
buildings; stored in the reservoirs, and the water used from this reservoir is measured and monitored by the
building management via watermeter readings. Rainwater includes the amount of water recovered/reused.
Total drinking water refers to the amount of water consumed for drinking purposes in the Headquarters buildings.
Drinking water for these buildings is supplied by tankers and bottled water; which have been recorded since
2021. In service buildings that own ISO14001 certificate, total drinking water is supplied by bottled water. The
water consumed in service buildings is not included in the reporting scope.
The total amount of wastewater was calculated as the sum of the amount of water purchased as municipal water
and collected as rainwater and reused in various activities.
It includes the greenhouse gas emission intensity values calculated by dividing the Bank's Scope 1 and Scope
2 greenhouse gas emissions by its consolidated assets, the total number of employees in Turkey and its
consolidated net profit. The Bank's total assets and net profit are taken from the 31 December 2022 financial
statements approved by the independent auditor.
ੵ The total amount of waste recycled; consists of recycled non-hazardous waste, recycled hazardous waste,
paper waste and electronic waste.
ੵ Plastic, metal and glass wastes collected within the scope of recycled non-hazardous wastes are evaluated.
ੵ Battery, fluorescent lamp, battery, car battery and toner cartridge wastes collected within the scope of recycled
hazardous wastes are evaluated.
ੵ Recycled paper waste, paper, cardboard, parcels etc. indicates the amount of waste.
ੵ Waste reporting limits include ATOM, TUTOM, Kule-1, ATLAS buildings and Branch buildings included in the
ISO14001 environmental management certificate.
Receipts from authorized recycling companies have been taken into account in calculating the amount of
recycled waste.
Renewable Energy Portfolio of İş Bankası
ੵ Number of renewable energy
Renewable energy projects financed in 2022 included,
projects financed in 2022, installed
capacity (MW) and loan amount
provided to these projects
ੵ Total installed capacity of
renewable energy projects
financed by İşbank
ੵ Hydroelectric Power Plant (HEPP)
ੵ Wind Power Plant (WPP),
ੵ Biomass Power Plant (BES)
ੵ Solar Power Plant (GES)
ੵ Geothermal Power Plant (GPP)
The loan amount provided for the projects has been determined over the total limit information by taking the
sum of cash and non-cash loans extended by the Corporate Loans Allocation, Commercial and Retail Loans
Allocation and Project Finance Departments of the Bank. In this process, the loan allocation files of the projects
were taken as reference in determining the total loan amounts provided to the projects along with the information
on installed capacity. The number of renewable energy projects covers the number of power plants financed.
When calculating Installed power capacity for projects financed by consortium structures, bank shares are not
taken into consideration in calculating and total installed power information of the power plant/plants is reported.
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İşbank 2022 Integrated Annual Report 453
Reporting Guidance
Indicators for Environmental and Social Risk Assessment
Number of financed projects
subjected to environmental and
social risk assessment and risk
categories
Field visits within the scope of
Environmental and Social Risk
Assessment
Talent Management Indicators
ੵ Average annual training hours
per employee
ੵ Average training hours
per female employee
ੵ Average training hours
per male employee
Within the scope of the Environmental and Social Risk Assessment Model (ÇESMOD), whose details are given
under the heading Responsible Finance in the Responsible Banking section, projects with an investment amount
of 10 million USD or more in the reporting period, for which loans have been allocated and/or committed, are
evaluated. Projects entering the ÇESMOD evaluation process; It is evaluated with reference to national legislation
and national and international regulations such as IFC (International Finance Corporation) Performance
Standards, EBRD (European Bank for Reconstruction and Development) Performance Requirements, Equator
Principles, and a Project Environmental and Social Assessment Document is issued for each project.
Definition of this indicator covers the number of field visits carried out within the scope of environmental and
social risk assessment during the reporting period to monitor the projects financed in 2022 or before.
Training hours are calculated considering all trainings, excluding private security renewal trainings given to
employees during the year. In this context, the calculations are made by dividing the total hours of training given
to the employees during the reporting period by the number of employees as of 31 December 2022 (private
security and servant staff are not included in these calculations.).
ੵ Number of employees received
"Anti-Bribery and Anti-Corruption"
training and total training time
ੵ Number of employees received
"Ethical Principles / Business Ethics"
training and total training time
ੵ Number of employees received
"Human Rights" training and total
training time
ੵ Number of employees received
"Sustainability" training and total
training time
ੵ Number of employees received
“Information Security” training and
total training time
“Anti-Bribery and Anti-Corruption”, “Ethical Principles”, “Human Rights” and “Sustainability” trainings are
covered by the training modules including those subjects. Calculations for this indicator consider the number of
employees participated in those trainings and the amount of time allocated to those issues within these trainings.
There are no trainings directly devoted to “Anti-Bribery and Anti-Corruption”, “Ethical Principles”, “Human Rights”
and “Sustainability” issues within the Bank. However, these issues have been addressed within certain training
programs for certain periods of time. Therefore, when calculating the total hours of training and the number of
participants, the time allocated for these titles is taken into account within the existing training programs. On the
other hand, when calculating the training periods, the duration of the training given in these areas in the training
programs organized by the Board of Inspectors for the Board Members are not included.
The subject of human rights is also mentioned in the course of " Law on Private Security Services and Individual
Rights”, which is provided to private security personnel as part of the renewal trainings at certain time intervals.
This subject was not included in calculations, since it is a subject mentioned within the 10-hour renewal trainings
provided by different suppliers in different provinces.
Calculations for total hours of information security trainings, considered the number of employees participated in
trainings covering information security related issues (cyber security, social engineering and information security
etc.) and the number of hours devoted those subjects.
ੵ Hours of training per newly
recruited employees in the first
year
ੵ Hours of Management and
Leadership Development Program
training per person
ੵ Hours of IT Competence
Development Trainings per person
ੵ Share of digital trainings in total
trainings
Human Resources Indicators
Total Number of Employees
Breakdown of employees by gender
and type of employment
Hours of training per newly recruited employees in the first year indicates the ratio of the total hours of training
received by new employees during the reporting period to the number of newly recruited employees. In
calculation of the relevant indicator, private security staff, members of the administrative council and servant staff
were excluded.
Hours of management and leadership development programs per person is calculated by dividing the total hours
of training management and leadership development programs by the number of managers (sub Manager and
above) as of 31 December 2022.
Hours of IT competence development training per person is calculated by dividing the total hours of “IT Business
Line Trainings” during the reporting period with the number of employees within the Department of Information
Technologies and Data Management (excluding private security and servant staff) as of 31 December 2022.
Digital trainings include distanced education such as videos, e-trainings and e-games. The share of digital
trainings in total trainings is calculated by dividing the total duration of Digital Trainings completed in the reporting
period by the total hours calculated for all trainings.
Total number of employees covers all employees of Türkiye İş Bankası those are employed at Turkey and
overseas operations as of 31st of December 2022. Interns; subcontractors; employees of Bank-Finance and
Insurance Workers Union (BASİSEN) and Türkiye İş Bankası A.Ş. Mensupları Emekli ve Munzam Sandık Vakıfları;
and subsidiary employees at Turkey and overseas operations are excluded from the total number of employees.
This indicator refers to breakdown of total number of employees by gender and employment type (Full Time
/ Part Time and Partial Time Status). Employment types include full time, part time and partial time status
employees. Part time employees include those, for whom, a working day consists of 4 hours. Whereas partial time
status employees include those, for whom a working day consists of 5 hours. Partial time status is provided to
contract-based employees as well as permanent staff who had returned from maternity leave or their partners.
Employee Turnover Rate
Covers the ratio of the total number of employees who resigned during the year to the average number of
employees. The average number of employees is calculated by dividing the sum of number of Bank’s employees
determined at each month by 12.
Women Ratio in senior Management
(%)
Covers the ratio of total number of female employees with the title of sub manager and above to the total number
of employees working with the title of sub manager and above, as of 31 December 2022. (sub manager and
above titles include second manager, IT manager, managers and members of the Board of Directors.)
Unionization rate
This İndicator covers the ratio of employees who are members to BASİSEN to the total number of employees as
of 31st of December 2022.
Number of employees benefited
from maternity leave
Covers the number of employees who had left for paid or unpaid maternity leave during the reporting period.
Number of employees returned from
maternity leave
Covers the number of employees who had returned from paid or unpaid maternity leave during the reporting
period.
Rate of return from maternity leave
The ratio of return from maternity leave is defined as the ratio of female employees who had returned to work
from (paid or unpaid) maternity leave during the reporting period to the total number of female employees whose
date of return from (paid or unpaid) maternity leave was within the reporting period.
Retention rate after maternity leave
Number of employees benefited
from paternity leave
Retention rate after maternity leave covers the female employees those who continue to work at İş Bankası as of
the end of reporting period. Reporting and calculations for those employees cover one year prior to the reporting
period. The rate of retention reported for 2022 reflects the rate of female employees who had returned from
(paid or unpaid) maternity leave in 2021 and continued to work at İş Bankası for 1 year to the number of female
employees who had returned from (paid or unpaid) maternity leave in 2021.
Covers the number of employees who had left for paid or unpaid paternity leave during the reporting period.
OHS data on the basis of female and male employees
Number of Incidents
Occupational Health and Safety related data covers İş Bankası employees within the borders of the Republic of Turkey.
It covers the definition of work accident within laws numbered 6331 and 5510. In this context, calculations are
made by considering the statements of the employees who reported work accidents, the hospital reports, the
workplace doctor or the institution doctor reports.
Injury Rate
It is the ratio of the number of injuries resulting from occupational accidents to the total number of full-time
employees.
Number of Fatal Incidents and
Number of Work Related Fatalities
It is the number of fatalities resulting from accidents. As a result of the incident, it is evaluated according to the
result of the fatalities report submitted by the competent authorities together with the judicial authorities.
Number of Occupational Disease
It is the number of temporary or permanent diseases that are exposed due to a recurring reason caused by the
nature of the work or related conditions of the work. These calculations are made in-line reports that have been
prepared by the Health Boards authorized by the Turkish Ministry of Health.
Absence due to accident
Calculated by considering the days of absence due to work accidents. In this regard, calculations are made
according to the periods as stated in the doctor/hospital reports of the employees those had reported work
accidents to Human Resources Management Division.
Total Injury Frequency Rate (IR -
Injury Rate)
The ratio of accidents during the year to total working time is calculated. In this regard, calculations are made
by the formula of “Total number of accidents/ (Total working hours - Lost hours) * 200,000”. The number of
accidents in this formula is obtained from the accident report forms filled out by employees. While calculating
total working hours, official holidays within the year are subtracted and 1 workday is accepted as 8 hours.
Lost hour data is reported by calculating total number of work hours lost by the number of daily absences due to
accidents.
Lost Day Rate (LDR)
Covers the ratio of the number of days lost due to work accidents to total work hours. This calculation uses the
following formula “(Total number of lost days * 200,000)/Total work hours”. The lost days in the formula covers
absences due to accident.
Occupational Disease Rate (ODR)
It is calculated by taking into account the ratio of total working hours of employees who are exposed to temporary
or permanent occupational diseases due to a recurring reason caused by the nature of the work or due to
conditions of the work. In this calculation, the formula used was as the following: “(Number of Occupational
Diseases * 200,000) / Total Working Hours”.
Absentee Rate (AR)
Covers the ratio of lost work hours to total work hours. This calculation uses the formula “Lost work hours/Total
human work hours”.
Number of OHS Committees
established and the total number
of members and representatives
working on the committees
The indicator covers the number of OHS committees established at İş Bankası buildings with an employee
population of 50 or more, in accordance with the law number 6331 on OHS. In this context total number
of members corresponds to the total number of members to OHS committees. Union representatives are
considered as natural employee representatives.
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İşbank 2022 Integrated Annual Report 455
Reporting Guidance
Limited Assurance Report
Other Indicators
Total amount of loan agreements
signed with international financial
institutions within the sustainable
framework for the year of 2022
Number of customers
In 2022, the amount of loans obtained from international financial institutions such as KfW, EIB, EBRD, Proparco,
OPIC and IFC to create environmental and social benefits through bilateral agreements or securitization
transactions were controlled. A list of l loan agreements that are in-line with the sustainable framework signed with
international financial institutions was obtained from the Financial Institutions Department, and the relevant loan
agreements and loan proceeds and related supporting documents were reviewed. Criteria such as signing date,
official signatures, loan proceed and use of proceed date and principal amount, interest amount, original currency
type in these contracts and loan proceed documents were analysed. The bank system screenshots of the relevant
loans were obtained and compared with the screenshots of the amounts reported to the TCMB and the BDDK.
The indicator covers all İş Bankası clients (including real and legal persons) as of 31 December 2022 except
for cancelled customers (customers whose accounts were closed) and customers with non-performing loans,
also including individual clients with inactive accounts and persons who had engaged with the Bank (those who
made a credit application or a money transfer as well as those who possess a supplementary card and those
who represent an İş Bank client) hence seen as a potential client.
Number of digital banking
customers
The number of customers who have successfully logged into any of the individual İşCep, commercial İşCep,
Maximum Mobil, Maximum İş Yerim, Individual Internet Branch or Commercial Internet Branch channels with their
customer number and password during the reporting period.
Number of mobile banking users
The number of customers who have successfully logged into any of the individual İşCep, commercial İşCep,
Maximum İş Yerim or Maximum Mobil channels with their customer number and password during the reporting
period.
Customer Satisfaction Score
Net Promoter Score
Paper savings through digitized
processes (Number of pages
printed)
Number of trees planted during
the year within the scope of
the project carried out with the
TEMA Foundation
Number of graduates from “81
Students from 81 Cities” Project
conducted with Darüşşafaka
Total Amount of Cash Loans
Extended to the Agricultural
Sector (billion TL)
The indicator covers scores reflected in individual and commercial customer experience surveys conducted by
independent research companies during the reporting period.
The indicator reflects the difference of the total number of pages printed in same brand printers in İş Bankası
branches during the reporting period compared to the previous year. During the calculations number of print
reports provided by the printers were taken into account.
Includes the number of trees which will be planted in 2022 in exchange to the paper waste (papers belonging to
the expired files collected from archives) donated by İş Bankası to TEMA in between 31 January 2022 -1 March
2022. 1 tree is planted for every 100 kg of paper waste donated. In this context, receipts of collected paper waste
from İş Bankası archives were examined.
Includes the number of graduates during the reporting period from Daruşşafaka within the scope of the
scholarship program, 81 Students from 81 Cities, conducted by İş Bankası with Darüşşafaka. An official letter
provided by Darüşşafaka was taken into consideration.
Covers the total amount of retail and commercial cash loans extended to the agriculture and livestock sector
during the reporting period and also includes loans covered by the NACE A code. The labelling and classification
of loans on the system has been checked and tested.
Total Amount of Loans Provided
to SMEs (billion TL)
Definition of this indicator in previous years, covered individual and commercial cash loans extended to SMEs.
During the reporting period of 2022, the definition was extended to cover individual and commercial cash and
non-cash loans extended to SMEs.
Number of views of İŞ'TE KOBİ
Includes the number of users logged into İş Bankası’s www.istekobi.com.tr website which has been active since
2008, during the reporting period. Calculations within this indicator took into account Google Analytics data.
Number of ATMs
Includes the total number of ATMs belonging to İş Bankası in Turkey and Turkish Republic of Northern Cyprus
(TRNC) as of the reporting period. In this context data provided by the Interbank Card Center for December 2022
has been taken into account.
Number of Disabled-friendly
ATMs
Total Amount of Cash Loans
Extended to the Women
Entrepreneurs
Includes the total number of ATMs belonging to İş Bankası, located in Turkey and TRNC which are accessible to a
wheelchair and/or includes a headphone jack as of the reporting period.
In the year of 2022, total amount of loans extended to the female customers whom definition is in-line with the
BDDK’s SME loan definition in TL among the loans extended to SMEs was checked and tested.
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İş Kuleleri, Kule 3, Kat:2-9
Levent 34330 İstanbul
+90 212 316 60 00
+90 212 316 60 60
www.kpmg.com.tr
Limited Assurance Report
To the Board of Directors of T. İş Bankası A.Ş.
We were engaged by T. İş Bankası A.Ş. (hereinafter “Bank” or “İş Bankası”), to provide independent limited assurance on the “Selected
Information” contained in the Integrated Annual Report of İş Bankası (hereinafter "the Report") for the year ended 31 December 2022.
The scope of our assurance is limited to the Selected Information listed for İş Bankası below:
ੵ Number of renewable energy projects financed during the year, their installed capacity (MW) and the loan amount provided to these
projects (million USD)
ੵ Number of projects financed after undergoing environmental and social risk evaluation, and risk categories
ੵ Number of field visits made as part of environmental and social risk management
ੵ Total amount of cash commercial loans extended to the agricultural sector (billion TL)
ੵ Total amount of loan agreements signed with international financial institutions within the sustainable framework during the year
ੵ Amount of supplied renewable energy
ੵ Total amount of loans provided to SMEs (billion TL)
ੵ Number of İŞ'TE KOBİ SME website views
ੵ Total amount of financing provided to women entrepreneurs
ੵ Number of saplings planted during the year under the project with the TEMA Foundation
ੵ Number of Customers
ੵ Net Promoter Score
ੵ Customer satisfaction score
ੵ Number of ATMs
ੵ Number of disabled-friendly ATMs
ੵ Ratio of disabled-friendly ATMs (%)
ੵ Number of digital banking customers
ੵ Number of mobile banking users
ੵ Total paper savings due to digitized processes (pages)
ੵ Total number of employees
ੵ Breakdown of employees by gender and type of employment
ੵ Employee turnover rate (%)
ੵ Women employee ratio in senior management (%)
ੵ Unionization rate (%)
ੵ Numbers of employees taking and returning from maternity leave
ੵ Rate of return from maternity leave and retention rate after maternity leave (%)
ੵ Number of employees using paternity leave
ੵ OHS data on the basis of female
Number of incidents
Number of fatal incidents
Number of occupational diseases
Days of absence due to accident
Accident frequency rate
Lost day rate (LDR)
Occupational disease rate (ODR)
Absentee rate (AR)
Injury rate
Number of work-related fatalities
Number of employees carrying out tasks with a high risk of occupational diseases
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 456 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 457
Limited Assurance Report
Limited Assurance Report
ੵ Number of Occupational Health and Safety Committees (OHS Committees) and the total numbers of members and employee
representatives in the committees
ੵ Average training hours per employee, average training hours per female employee, average training hours per male employee
ੵ Hours of training per newly recruited employee in their first year
ੵ Number of employees receiving "Anti-Bribery and Anti-Corruption", "Ethical Principles / Business Ethics", "Human Rights" and
"Sustainability" training and total training hours
ੵ Number of participants of information security trainings and total training hours
ੵ Share of digital trainings within all trainings (%)
ੵ Hours of training per person in the management and leadership development program
ੵ Hours of training per person in Information Technologies (IT) competence development trainings
ੵ Number of graduates from the "81 Students from 81 Cities"
ੵ Greenhouse Gas Emissions;
Scope 1 (ton CO2e)
Scope 2 (ton CO2e)
Scope 3 (ton CO2e)
ໜ Category 1: Purchased Goods and Services (resulting from paper consumption)
ໜ Category 5: Waste Generated in Operations
ໜ Category 6: Business Travel
ໜ Category 7: Employee Commuting
ੵ Refrigerants consumption (kg)
ੵ Total energy consumption (GJ)
Electricity consumption (kWh)
Natural gas consumption (m3)
Fuel-oil consumption (lt)
Coal consumption (kg)
Diesel consumption (lt)
ੵ Fuel consumption of vehicles (lt) (fuel consumption of company vehicles, fuel consumption of personnel service vehicles, fuel
consumption due to business travel with private cars)
ੵ Total water consumption (m3)
Total consumption of municipal water (m3)
Total rainwater (recovered/reused) (m3)
Total drinking water (m3)
Total wastewater production (m3)
ੵ Amount of total waste and type of waste
ੵ Amount of domestic waste (tons) and type of waste
ੵ Hazardous waste (batteries, fluorescent lamps, car batteries, toner cartridges)
Amount (tons) and type of recycled waste
Amount (tons) and type of recycled non-hazardous waste (paper, plastic, metal, glass)
Amount (tons) and type of recycled hazardous waste
Amount of electronic waste recycled
ੵ Emission intensities (per employee (tonnes of CO2e/number of employees), per consolidated total assets (tonnes of CO2e/millions
TL), and per consolidated net profit (tonnes of CO2e/millions TL))
Management's responsibilities
Management is responsible for the preparation and presentation of the Report for the Selected Information in accordance with the İş
Bankası’s Reporting Guidance as described in the Report, and the information and assertions contained within it; for determining the İş
Bankası’s objectives in respect of sustainable development performance and reporting, including the identification of stakeholders and
material issues; and for establishing and maintaining appropriate performance management and internal control systems from which the
reported performance information is derived.
Management is responsible for preventing and detecting fraud and for identifying and ensuring that İş Bankası complies with laws and
regulations applicable to its activities.
Management is also responsible for ensuring that staff involved with the preparation and presentation of the description and the
Selected Information are properly trained, information systems are properly updated and that any changes in reporting encompass all
significant business units.
Our responsibilities
Our responsibility is to carry out a independent limited assurance engagement and to express a conclusion based on the work
performed. We conducted our engagement in accordance with International Standard on Assurance Engagements (ISAE) 3000,
Assurance Engagements other than Audits or Reviews of Historical Financial Information, issued by the International Auditing and
Assurance Standards Board. That Standard requires that we plan and perform the engagement to obtain limited assurance about
whether the Selected Information is free from material misstatement.
We apply the International Standard on Quality Control 1 (ISQC1) and, in conformity with this Standard, maintain a comprehensive system
of quality control including documented policies and procedures regarding the compliance with ethical principles, professional standards
and applicable legal and regulatory requirements.
We have complied with the independence and other ethical requirements of the Code of Ethics for Professional Accountants issued by
the International Ethics Standards Board for Accountants, which is founded on fundamental principles of integrity, objectivity, professional
competence and due care, confidentiality and professional behavior.
Procedures performed
A limited assurance engagement on a Selected Information consists of making inquiries, primarily of persons responsible for the
preparation of information presented in the Selected Information, and applying analytical and other evidence gathering procedures, as
appropriate. These procedures included:
ੵ Interviews with relevant staff at the corporate and business unit level responsible for providing the information in the Selected
Information,
ੵ Using the Reporting Guidance of the Report to measure and evaluate the Selected Information,
ੵ Evaluating the design and implementation of key processes and controls over the Selected Information,
ੵ Re-performing, on a sample basis, the calculations used to prepare the Selected Information for the reporting period,
ੵ Evaluating the disclosure and presentation of the Selected Information in the Report to determine whether it is in line with our overall
knowledge of, and experience with, the sustainability performance of İş Bankası,
ੵ Comparing the information presented in the Selected Information to corresponding information in the relevant underlying sources to
determine whether all the relevant information contained in such underlying sources has been included in the Selected Information,
ੵ Reading the information presented in the Selected Information to determine whether it is in line with our overall knowledge of, and
experience with, the sustainability performance of İş Bankası.
The procedures performed in a limited assurance engagement vary in nature and timing from, and are less wide than a reasonable
assurance engagement. Consequently, the level of assurance obtained in a limited assurance engagement is lower than that of a
reasonable assurance engagement.
Inherent limitations
Due to the inherent limitations of any internal control structure it is possible that errors or irregularities in the information presented in the
Selected Information may occur and not be detected. Our engagement is not designed to detect all weaknesses in the internal controls
over the preparation and presentation of the Selected Information, as the engagement has not been performed continuously throughout
the period and the procedures performed were undertaken on a test basis.
Conclusion
Our conclusion has been formed on the basis of, and is subject to, the matters outlined in this report.
We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our conclusions.
Based on the procedures performed and the evidence obtained, as described above, nothing has come to our attention that causes us
to believe that the Selected Information as defined in the Report of İş Bankası for the year ended 31 December 2022 is not presented, in
all material respects, in accordance with the İş Bankası’s internally developed reporting criteria as explained in the Reporting Guidance.
In accordance with the terms of our engagement, this independent limited assurance report on the Selected Information has been
prepared for İş Bankası in connect with reporting to İş Bankası and for no other purpose or in any other context.
Restriction of use of our report
Our report should not be regarded as suitable to be used or relied on by any party wishing to acquire rights against us other than İş
Bankası, for any purpose or in any other context. Any party other than İş Bankası who obtains access to our report or a copy thereof and
chooses to rely on our report (or any part thereof) will do so at its own risk. To the fullest extent permitted by law, we accept or assume no
responsibility and deny any liability to any party other than İş Bankası for our work, for this independent limited assurance report, or for the
conclusions we have reached.
KPMG Bağımsız Denetim ve Serbest Muhasebeci Mali Müşavirlik Anonim Şirketi
Şirin Soysal,
Partner
İstanbul, 8 March 2023
An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 458 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 459
GRI Content Index
GRI Content Index
Statement of Use
Use of GRI 1
İşbank has prepared its report covering the period January 1, 2022-December 31, 2022 in accordance with GRI Standards.
GRI 1: Foundation 2021
Applicable GRI Sector Standard(s)
/
GRI STANDARD/
OTHER SOURCE
General Disclosures
DISCLOSURE
LOCATION
OMISSIONS
Requirement(s)
Omitted
Reason
Explanation
2-1 Organizational details
An Overview of İşbank, pp.: 10-14
https://www.isbank.com.tr/en/about-us/who-we-are
2-2 Entities included in the organization's
sustainability reporting
About the Report, p. 6
2-3 Reporting period, frequency and contact
point
About the Report, p. 6; Contact - Back Cover
2-4 Restatements of information
GRI Content Index: There is no restated information in the report.
2-5 External assurance
Independent Assurance Report will be added as soon as the audit report
is completed.
2-6 Activities, value chain and other business
relationships
https://www.isbank.com.tr/en/about-us/who-we-are
İşbank Overview, page: 8
2-7 Employees
Human Resources Data, pp.: 446-447
2-8 Workers who are not employees
Human Resources Data, pp.: 446-447
2-9 Governance structure and composition Management Structure, pp. 135-137
2-10 Nomination and selection of the highest
governance body
Management Structure, p. 135
2-11 Chair of the highest governance body
Management Structure, pp. 135, 145
2-12 Role of the highest governance body in
overseeing the management of impacts
Management Structure, p. 135
2-13 Delegation of responsibility for
managing impacts
Sustainability Management, p. 34; Management Structure, pp. 135, 145
GRI 2: General
Disclosures 2021
2-14 Role of the highest governance body in
sustainability reporting
Sustainability Management, p. 34
2-15 Conflicts of interest
Management Structure, p. 135
2-16 Communication of critical concerns
Our Stakeholders, pp. 35-37
2-17 Collective knowledge of the highest
governance body
2-18 Evaluation of the performance of the
highest governance body
Board of Directors, pp. 136-143
Board of Directors, pp. 147-153
2-19 Remuneration policies
Employee Rights, page:; Remuneration Policy, https://www.isbank.com.tr/
bankamizi-taniyin/Documents/yatirimci-iliskileri/ucretlendirme-politikasi.pdf
2-20 Process to determine remuneration
Remuneration Policy https://www.isbank.com.tr/bankamizi-taniyin/
Documents/yatirimci-iliskileri/ucretlendirme-politikasi.pdf
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2-21 Annual total compensation ratio
Remuneration Policy https://www.isbank.com.tr/bankamizi-taniyin/
Documents/yatirimci-iliskileri/ucretlendirme-politikasi.pdf
2-21 a; 2-21 b;
2-21 c
Confidentiality
constraint
2-22 Statement on sustainable development
strategy
Our Business Model: İşbank Banking, pp. 28-33
2-23 Policy commitments
Sustainability Management, p. 34
2-24 Embedding policy commitments
Sustainability Management, p. 34
2-25 Processes to remediate negative
impacts
2-26 Mechanisms for seeking advice and
raising concerns
Our Stakeholders, pp. 34-37; Sustainability Management, p. 34
Prioritization Process in İşbank pp. 38-45, Our Stakeholders, pp. 35-37
2-27 Compliance with laws and regulations
Footnote: pp. 299, 407, 415,
2-28 Membership associations
Initiatives Supported in the Field of Sustainability, pp. 47-49; Corporate
Memberships, p. 443
2-29 Approach to stakeholder engagement
Our Stakeholders, p. 34; Prioritization Process in İşbank pp. 38-45
2-30 Collective bargaining agreements
Key Performance Indicators, p. 446
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İşbank does not
disclose this
information due to
confidentiality.
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For the Content Index - Core Service, the GRI Services reviewed that the GRI content index is presented in a clear and consistent manner with the Standards and that references to
disclosures 2-1 to 2-5, 3-1, and 3-2 are consistent with the relevant sections of the report. This service was performed on the Turkish version of the report.
DISCLOSURE
LOCATION
OMISSIONS
Requirement(s)
Omitted
Reason
Explanation
GRI STANDARD/
OTHER SOURCE
Material Topics
GRI 3: Material Topics
2021
3-1 Process to determine material topics
Prioritization Process in İşbank pp. 38-45
3-2 List of material topics
Materiality matrix, p. 39
Financial Performance and Profitability
GRI 3: Material Topics
2021
GRI 201: Economic
Performance 2016
3-3 Management of material topics
Sustainability Priorities, p.: 39; Financial Performance, pp. 57-58
201-1 Economic value generated
Value Creation Model, pp. 32-33; Financial Performance, pp.: 57-58
201-4 Financial assistance received from
government
GRI Content Index: No government support was received.
Business Ethics, Transparency and Reporting
GRI 3: Material Topics
2021
GRI 205: Anti-
Corruption 2016
3-3 Management of material topics
Sustainability Priorities, p. 39; Management Approach, pp.: 135-137
205-1 Total number and percentage of
operations assessed for risks related to
corruption and significant risks identified
205-2 Communication and training about
anti-corruption policies and procedures
Business Ethics, p.: 162
Business Ethics, p.: 162; Anti-Bribery and Anti-Corruption, p. 163
205-3 Incidents of corruption
Business Ethics, p.: 162; Anti-Bribery and Anti-Corruption, p. 163
GRI 408: Child Labor
2016
408-1 Operations and suppliers at significant
risk for incidents of child labor
GRI 409: Forced or
Compulsory Labor
2016
409-1 Operations and suppliers at significant
risk for incidents of forced or compulsory
labor
GRI 410: Security
PracticeS 2016
410-1 Kuruluşun insan hakları politikaları veya
prosedürleri konusunda eğitim görmüş
güvenlik
personelinin yüzdesi
GRI Content Index: Among the recruitment conditions in our Bank's
Personnel Regulations, there is a regulation that requires employees "to
be over the age of 18".
GRI Content Index: The working conditions of employees at İşbank
are determined within the framework of the provisions of the labor
legislation, the Bank's internal regulations, and the provisions of the
Collective Bargaining Agreement. In this context, the principle of
freedom of employment and contract as expressed in the Constitution
is valid at İşbank. In addition, İşbank is among the organizations with
the highest rate of unionized employees in the sector. Therefore, İşbank
does not have any operations with the risk of forced / compulsory labor.
GRI Content Index: In accordance with Law No. 5188 on Private Security
Services and the provisions of the regulation on the implementation of
this Law, persons whose Private Security Identity Card validity will expire
must take this training. The validity period of the Identity Card is 5 years.
Accordingly, 191 Private Security Officers received the relevant training
in 2022. On 31.12.2022, the number of our Private Security Officers was
1869 and 10.22% of them attended the refresher training.
GRI Content Index: İşbank does not make donations to any political
parties.
415-1 Political contributions
GRI 415: Public
Policies 2016
GRI 206: Anti-
Competitive Behavior
2016
206-1 Anti-Competitive Behaviors
Footnotes: pp. 299, 415
Efficient Risk Management
GRI 3: Material Topics
2021
GRI 201: Economic
PerformanCE 2016
Digital Banking
GRI 3: Material Topics
2021
Customer Centricity
GRI 3: Material Topics
2021
3-3 Management of material topics
Sustainability Priorities, p. 39; Efficient Risk Management, pp.: 158-161
201-2 Risks due to climate change
Climate Action, pp.: 76-78; Risks, Opportunities & Future Insights, p.: 23
3-3 Management of material topics
Sustainability Priorities, p. 39; Digital Banking, pp.: 88-91
3-3 Management of material topics
Sustainability Priorities, p. 39; Customer Centricity, pp.: 65-67
417-1 Product and Service Information
and Labeling
Responsible Marketing, p.: 68; Financial Literacy, p.: 71
GRI 417: Marketing
And Labeling 2016
417-2 Incidents of non-compliance
concerning product and service information
and labeling
GRI Content Index: There are no cases associated with non-compliance
with the regulations and rules on product and service information and
labeling during the reporting period.
417-3 Incidents of non-compliance
concerning marketing communications
GRI Content Index: There are no cases associated with non-compliance
with the regulations and rules on marketing communication during the
reporting period.
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An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 460 İşbank 2022 Integrated Annual Report
İşbank 2022 Integrated Annual Report 461
GRI Content Index
GRI Content Index
GRI STANDARD/
OTHER SOURCE
Cyber Security and Customer Privacy
DISCLOSURE
LOCATION
GRI 3: Material Topics
2021
GRI 418: CUSTOMER
PRIVACY 2016
3-3 Management of material topics
Sustainability Priorities, p. 39; Information Security at İşbank, pp.:
99-100
418-1 Customer Data Privacy
GRI Content Index: The number of complaints is not disclosed due to
data privacy.
Responsible Financing and Investment Integrating ESG Criteria
GRI 3: Material Topics
2021
GRI 304: Biodiversity
2016
3-3 Management of material topics
Sustainability Priorities, p. 39; Environmental and Social Risk
Management in Loans, pp.: 82-83
304-2 Impact of activities on biodiversity
Environmental and Social Risk Management in Loans, pp.: 82-83
GRI 413: LOcal
Communities 2016
413-2 Operations with negative impacts on
local communities
Environmental and Social Risk Management in Loans, pp.: 82-83
Responsible Products and Services
GRI 3: Material Topics
2021
3-3 Management of material topics
Sustainability Priorities, p. 39; Responsible Products and Services, pp.:
68-70
Employee Rights and Satisfaction
GRI 3: Material Topics
2021
GRI 202: Market
PresenCE 2016
3-3 Management of material topics
Sustainability Priorities, p. 39; Employee Rights, p.: 122
202-1 Entry level wage by gender
Employee Rights, p.: 122; Remuneration Policy, https://www.isbank.
com.tr/bankamizi-taniyin/Documents/yatirimci-iliskileri/ucretlendirme-
politikasi.pdf
401-1 New employee hires and employee
turnover
Key Performance Indicators, p.: 115
GRI 401: Employment
2016
401-2 Benefits provided to full-time
employees that are not provided to part-time
employees
Employee Rights, p.: 122; Remuneration Policy, https://www.isbank.
com.tr/bankamizi-taniyin/Documents/yatirimci-iliskileri/ucretlendirme-
politikasi.pdf
401-3 Parental Leave
Human Resources Data, pp.: 448
GRI 402: Labor/
Management
Relations 2016
402-1 Notice Periods
GRI Content Index: In case of significant operational changes, legal
notice periods are followed.
GRI 404: Training and
EducatION 2016
404-1 Hours of training per employee
Talent Management, pp.: 126-127
404-2 Talent management and lifelong
learning program
404-3 Percentage of employees receiving
regular performance and career development
reviews
403-1 Percentages of employees represented
in management-worker health committees
403-2 Type of injury and accident frequency
rates, occupational diseases, lost days and
absenteeism, and total number of work-
related fatalities
Talent Management, pp.: 126-127
Talent Management, pp.: 126-127
Employee Health and Safety, p.: 125
Employee Health and Safety, p.: 125
GRI 403:
Occupational Health
And Safety 2018
403-3 Occupational health services
Employee Health and Safety, p.: 125
403-4 Employee participation
Employee Health and Safety, p.: 125
403-5 Training on occupational health and safety
Employee Health and Safety, p.: 125
403-6 Promotion of employee health
Employee Health and Safety, p.: 125
403-8 Scope of occupational health and
safety management system
Employee Health and Safety, p.: 125
403-9 Work-related accidents
Human Resources Data, pp.: 449
403-10 Work-related deaths
Human Resources Data, pp.: 449
GRI 407: Freedom of
Association or Collective
Bargaining 2016
407-1 Collective bargaining agreements and
union rights
Employee Rights, p.: 118
Equal Opportunity, Diversity and Gender Equality
GRI 3: Material Topics
2021
GRI 201: Economic
Performance 2016
GRI 405: DIversity
and Equal Opportunity
2016
3-3 Management of material topics
201-3 Retirement plans
Sustainability Priorities, p. 39; Equal Opportunity, Diversity and Gender
Equality pp.: 121-123
2020 Activity Report, pp.: 162, 225-227, https://www.isbank.com.tr/
bankamizi-taniyin/finansal-bilgiler
405-1 Diversity of governance bodies and
employees
Human Resources Data, pp.: 450-454; Equal Opportunity, Diversity and
Gender Equality, pp.: 125-127
405-2 Ratio of basic salary and remuneration
of women to men
GRI Content Index: Remuneration is managed through transparent and
measurable processes and systems, and there is no gender-based
wage differentiation. This rate is 1 as there is no difference in wages
based on gender. Employee Rights, p.: 122
OMISSIONS
Requirement(s)
Omitted
Reason
Explanation
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OTHER SOURCE
DISCLOSURE
LOCATION
GRI 406: Non-
Discrimination 2016
406-1 Incidents of discrimination
Responsible Purchasing and Supply
GRI Content Index: İşbank makes all decisions about its employees
independent of race, religion, language, sect or any belief, sexual
orientation/preference, gender, mental or physical disability, age,
cultural or social class and thought/opinion differences; it refuses any
discrimination against or among the employees and managers.
GRI 3: Material Topics
2021
3-3 Management of material topics
Sustainability Priorities, p. 39; Sustainability Priorities, pp.: 110-112
GRI 204: Procurement
Practices 2016
204-1 Amount of local procurement budget
and its ratio in the total procurement budget
Responsible Purchasing, p.: 112
GRI 308: Supplier
Environmental
Assessment 2016
GRI 414:
Supplier Social
Assessment 2016
308-1 Suppliers Subject to Environmental
Assessment
308-2 Significant actual and possible
negative environmental impacts of the supply
chain and actions taken
414-1 Ratio and number of new suppliers that
were screened using social criteria
Responsible Purchasing, p.: 110-112
Responsible Purchasing, p.: 110-112
Responsible Purchasing, p.: 110-112
414-2 Actual and possible negative social
impacts of the supply chain and actions taken
GRI Content Index: No negative social impacts were observed in the
supply chain.
The Bank's Environmental Footprint
GRI 3: Material Topics
2021
3-3 Management of material topics
Sustainability Priorities, p. 39; Environmental Impact Management, p.
108; Environmental and Social Impacts Policy https://www.isbank.com.
tr/bankamizi-taniyin/politikalarimiz
302-1 Energy consumption within the
organization
302-2 Energy consumption outside the
organization
Key Performance Indicators, p.: 106
Key Performance Indicators, p.: 106
GRI 302: Energy 2016
302-3 Energy intensity
Key Performance Indicators, p.: 106
302-4 Reduction of energy consumption
Environmental Impact Management, p.: 108
302-5 Reduction in energy requirements of
products and services
Environmental Impact Management, p.: 108, Paperless Banking, p. 92
GRI 303: Water and
Effluents 2018
303-3 Water withdrawal
Key Performance Indicators, p.: 106
303-5 Water consumption
Key Performance Indicators, p.: 106
GRI 305: Emissions
2016
305-1 Scope 1 Emissions
Key Performance Indicators, p.: 106
305-2 Scope 2 Emissions
Key Performance Indicators, p.: 106
305-3 Scope 3 Emissions
Key Performance Indicators, p.: 106
305-4 Emissions intensity
Key Performance Indicators, p.: 107
GRI 306: Effluents
and Waste 2020
305-5 Reduction of GHG emissions
Environmental Impact Management, p.: 108
306-2 Management of significant waste-
related impacts
Environmental Impact Management, p.: 108
306-3 Waste generation
Key Performance Indicators, p.: 106-107
306-4 Disposed Waste
Key Performance Indicators, p.: 106-107
Contribution to Social Welfare
GRI 3: Material Topics
2021
GRI 203: Indirect
Economic Impacts
2016
GRI 413: Local
Communities 2016
3-3 Management of material topics
Sustainability Priorities, p. 39; Contribution to Social Welfare, pp.:
188-189
203-1 Infrastructure investments
Financial Performance and Profitability, pp.: 57-58
203-2 Significant indirect economic impacts
Financial Performance and Profitability, pp.: 57-58
413-1 Operations with impact assessments
Environmental and Social Risk Management in Loans, pp.: 82-83
Combating Climate Change
GRI 3: Material Topics
2021
Financial inclusion
GRI 3: Material Topics
2021
3-3 Management of material topics
Sustainability Priorities, p. 39; Climate Action, pp.: 76-79
3-3 Management of material topics
Sustainability Priorities, p. 39; Financial Inclusion, pp.: 72-75
The future of business and new working models
GRI 3: Material Topics
2021
3-3 Management of material topics
Sustainability Priorities, p. 39; The Future of Business and New Working
Models pp.: 119-120
OMISSIONS
Requirement(s)
Omitted
Reason
Explanation
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An Overview Of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and AnnexesGood Corporate Citizen 462 İşbank 2022 Integrated Annual Report
Company Information
Corporate Title: Türkiye İş Bankası Anonim Şirketi
Trade Registry Number: 431112
Address: İş Kuleleri 34330 Levent/İstanbul
Website: www.isbank.com.tr
Contact Information of Branches: Please visit www.isbank.com.tr
Company Announcements and Financial Data:
İşbank’s financial statements, independent auditor’s reports, annual reports, press releases
and disclosures of material events are available on the Bank’s corporate website under the title
of Investor Relations, in both Turkish and English.
Contact Information
Telephone: +90 (212) 316 00 00
Fax: +90 (212) 316 04 04
Call Center: (0850) 724 0 724
E-posta: musteri.iliskileri@isbank.com.tr
Social Media Accounts
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