th
CONTENTS
AN OVERVIEW OF
İŞBANK
08
RELIABLE FINANCIAL
ACTOR
56
RESPONSIBLE
OPERATIONS
106
GOOD CORPORATE
CITIZEN
130
04
06
08
10
11
12
14
16
22
22
24
28
30
31
32
36
38
41
49
50
52
54
56
58
61
63
68
70
72
75
79
80
82
83
85
87
90
93
97
102
104
106
108
112
112
113
116
119
120
121
123
126
127
127
128
Introduction
About the Report
AN OVERVIEW OF İŞBANK
Corporate Profile
Our Vision, Values, Strategic Goals and Strategy
Highlights in 2023
İşbank from 1924 to Today
Messages from the Executives
Looking Into The Future
Operating Environment: General Evaluations
Global Tendencies, Risks, Opportunities and Forecasts
Message from the Sustainability Leader
Management Evaluation and Analysis
How Do We Create Value? Sustainability At İşbank
Value Creation Model
Sustainability Management
Our Stakeholders
Prioritization Process at İşbank
Material Topics and Reporting Frameworks
İşBank's Sustainability Journey
Initiatives Supported in the Field of Sustainability
Contribution to Sustainable Development Goals
RELIABLE FINANCIAL ACTOR
Inclusive and Robust Economy
Financial Performance and Profitability
İşbank and its Activities in 2023
İşbank's Subsidiaries
Customer Centricity
Responsible Banking
Financial Inclusion
Financial Literacy
Climate Action
Decarbonization Targets
Climate Risks Management
Environmental and Social Risk Management in Loans
Products and Services Contributing to a Green Economy
Innovative Bank for 100 Years
Digital Banking
Innovation and Entrepreneurship
Information Security
Awards We Won in 2023
RESPONSIBLE OPERATIONS
Reducing Negative Impacts of Operations
Environmental Impact Management
Environmentally Friendly Service Points
Responsible Supply Chain Management
Decent Work
Employee Loyalty and Satisfaction
Employee Rights
The Future of Business and New Working Models
Equal Opportunity, Diversity, and Gender Equality
Compliance with Operating Principles
Employee Health and Safety
Preferred Employer
Talent Management
130
132
135
136
138
144
148
150
150
155
158
159
164
165
166
168
170
170
173
173
174
179
190
195
195
196
197
198
198
308
426
GOOD CORPORATE CITIZEN
Transparent and Ethical Management
Management Structure
Board Member Matrix
Board of Directors
Executive Committee
Organization Chart
Information on Board of Directors Meetings in 2023
İşbank Committees
Information on Risk Management Policies Applied per Risk
Types
Managers of Internal Systems
Audit Committee’s Assessment on the Operation of Internal
Audit, Internal Control, Compliance, and Risk Management
Systems, and Information on its Activities in the Reporting Period
Business Ethics
Anti-Bribery and Anti-Corruption
Contribution to Social Welfare
Projects in the Field of Education
Projects in the Environmental Field
Projects in the Field of Culture and Art
Our Corporate Governance Approach
Corporate Governance Principles Compliance Statement
Corporate Governance Compliance Report
Corporate Governance Information Form
Sustainability Principles Compliance Framework
Dividend Distribution Policy
Profit Distribution Proposal
Summary Report of the Board of Directors
Agenda of the Ordinary General Assembly
Annual Meeting
Documents
FINANCIAL REPORTS
Non-Consolidated Financial Report
Consolidated Financial Report
ANNEXES
3
Reliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual ReportLooking Into the FutureAn Overview Of İşbankHow We Create Value Introduction
The Bank of Türkiye and the Future
for Exactly 100 Years!
Celebrating its century-
old corporate heritage by
blending it with innovation
and a vision of the future,
İşbank proudly presents
its 100th anniversary
Integrated Annual Report.
While celebrating our 100th anniversary, we are reinforcing highlighting not just our
accomplishments but also our long-standing dedication to responsible banking that has
shaped our identity. This report summarizes our efforts towards a sustainable future and is a
testament to our commitment to environmental, social, and governance responsibilities.
Celebrating its 100th anniversary in 2024 as one of our Republic's longest-established
institutions, İşbank is an institution synonymous with trust and reputation. Since its
foundation, İşbank has been committed to supporting the country's economy. As a
Republican institution, İşbank played an important transformative role in the national
economy, throughout its history. The Bank seeks to be an innovative, reliable, and respected
financial organization in its second century, drawing strength from its past and seeing itself
as "the bank of the future".
The 2023 Integrated Annual Report intends to inform its stakeholders how on the Bank's
preparations for its second century, as well as its priorities and strategies for this period.
The İşbank 2023 Integrated Annual Report details the Bank's value creation for its stakeholders in four main sections.
How Do We Create Value?
Reliable Financial Actor
section explains İşbank's value creation process ,
emphasizing the İşbank Banking model that prioritizes
sustainability. This section comprises the sustainability
priorities revised in 2023 in accordance with the “double
materiality” approach and the Bank's new strategic
goals, sustainability initiatives supported, stakeholder
communication, and contribution to the United Nations
Sustainable Development Goals.
section describes İşbank's role as a financial organization
supporting an inclusive and vibrant economy. This section
includes İşbank's sustainable financial performance goals,
customer experience considered during product and
service presentation, inclusiveness, financial literacy, and
savings awareness efforts. İşbank's business strategy
involves establishing itself as a key actor in climate action.
The Bank has described its role in the transition economy
and its targets in this field under this heading, together with
the digitization journey, which is critical to the Bank's vision
of becoming the "bank of the future".
Responsible Operations
Good Corporate Citizen
section sets out İşbank's projects and practices to
minimize the negative environmental impacts of its
operations and promote its working standards throughout
the supply chain. The section also covers İşbank's
employer approach, workplace practices, and employee
preparation for the future of business.
section provides an overview of the Bank's corporate
governance structure, ethical and principled banking
approach, effective risk management for short and long-
term risks and opportunities, management principles, and
performance.
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Looking Into the FutureAn Overview Of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report About the Report
İşbank's Integrated Annual Report for 2023 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
2023 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 2023
Integrated Annual Report includes İşbank’s 2023 performance in line
with its strategic priorities, 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
The İşbank 2023 Integrated Annual Report presents the Bank's
performance for the period between January 1st, 2023 and
December 31st, 2023. The Integrated Annual Report, which includes
consolidated and unconsolidated financial charts 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 performances is
included in the report.
See. İş Bank's Subsidiaries
Compliance and legislation
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:
䬞 The Provisional Standard for Commercial Banks Guide released by
the Sustainability Accounting Standards Board - SASB,
䬞 United Nations Environment Program Finance Initiative (UNEP FI)
Principles of Responsible Banking (PRB) Guideline,
䬞 The Integrated Reporting Framework () prepared by the Value
Reporting Foundation (VRF),
䬞 Carbon Disclosure Project’s (CDP) Climate Change and Water
Security Programs Guidelines,
䬞 World Economic Forum (WEF) Stakeholder Capitalism Metrics,
䬞 Bloomberg Gender Equality Index Indicators, and
䬞 Task Force on Climate-related Financial Disclosures (TCFD)
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 2023 Integrated
Annual 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,
2023 and December 31st, 2023, 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/en
Please send your opinions and suggestions on the report to
surdurulebilirlik@isbank.com.tr
Report’s Navigation
mark represents the data that passed the independent audit.
information in another section of the report.
You can return to the table of “Contents" page of the report with
the navigation bar at the top of the report.
Integrated Annual Report: This report
summarizes İşbank's performance,
strategies and targets, and financial
and non-financial components from an
integrated perspective.
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.
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.
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.
All reports published by İşbank are available on the sustainability page at https://www.isbank.com.tr/en or by contacting the
Investor Relations and Sustainability Division.
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Looking Into the FutureAn Overview Of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report An Overview
Of İşbank
Corporate Profile
Our Vision, Values,
Strategic Goals and
Strategy
Highlights in 2023
İşbank from 1924 to Today
Messages from the
Executives
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Corporate Profile
Our Vision, Values, Strategic Goals and
Strategy
Our Vision
Becoming the bank of the future,
creating sustainable value with
an inclusive and participatory
approach
Our Values
Innovation, Solidarity, Common
Sense, Reliability, Sincerity,
and Transparency adopted by
the guidance of the principles
"Intelligence, diligence, integrity,
technical and methodical work"
Our Strategic Goals
�� Continuous commitment to our country �� Strong and sustainable
financial performance �� Efficient risk management �� Flawless customer
experience �� Value-creating technology and innovation leadership ��
Happy and productive human resource �� Ethical and responsible banking
compassionate towards people, society, and the environment
Our Strategy
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.
İşbank is a leading financial institution in
its sector with its strong financial structure
and "bank of the future" vision.
As of the end of 2023, with its 21,167 employees providing services
to 24.3 million customers, İşbank is the largest private bank in Türkiye,
with a total asset size of TL 2,453.8 billion. İşbank is amongst the
most highly respected institutions in the banking sector, with its
products and services in corporate, commercial, SME, retail, and
private banking.
İşbank is widely accessible through its Internet Branch, İşCep (the
mobile app), Call Center, 6,312 ATMs (including TRNC and abroad)
and 660,375 POS devices (including online POS).
The Bank provides its services with 49 Regional Directorates and
1,066 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). In addition,
12 MaxiOfis, which are located in 8 different provinces within the
scope of the regional office design with open office design, provide
employees with the opportunity to work independently.
İşbank operates its cross-border banking activities with 2 branches
in Iraq, 2 in Kosovo, 2 in England, 1 in Bahrain, and 15 in Northern
Cyprus as of the end of 2023. 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
2023, İşbank has direct and indirect subsidiaries with 154 companies.
The number of companies controlled directly or indirectly by the Bank
is 119.
See İşbank's Subsidiaries
You can find the history of İşbank here.
Amendments to the Articles of Incorporation
İşbank’s Shareholding Structure**
Stable shareholding
structure for many
years
Strong
cooperation with
international
organizations
Large
shareholder
base
38.2%
33.7%
28.1*%
11 countries
foreign branches
representative
offices
abroad bank
subsidiaries
119 countries
1,000
banks effectively
managed correspondent
relationships with nearly
Free Float
Türkiye İş Bankası A.Ş. Members' Supplementary
Social Security and Charity Fund Foundation
Atatürk's Shares*
* 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 31.12.2023. (31.12.2022:
Foundation 37.31%, Atatürk Shares 28.09%, Public 34.60%).
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An Overview of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Highlights in 2023
Asset Size (TL bn.)
Cash Loans(TL bn.)
74.2%
increase
2.453,783
1.408,323
926,569
51.1%
increase
593,902
468,059
493,378
345,150
270,360
1,147,371
759,289
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
Deposits(TL bn.)
Shareholders' Equity(TL bn.)
78.5%
increase
1,662,179
931,077
595,628
39.9%
increase
267,797
191,376
58,873 67,,781
86,839
368,876
295,922
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
233.6billion TL
Market Value
24.3million
customers
72.3billion TL
Net Profit
7.23TL
Profit per share
1,066branches
22foreign
branches
1.5 billion TL
sustainable investment
fund
2.6 million
Maximum Mobile
users
27million
users served by Bankamatik
ATMs, including customers
of other banks
6,312
the largest ATM
network among
private banks
75.26%
share of İşCep in
transactions conducted
through all channels
77.3%
renewable energy
projects/Energy
generation portfolio
162.5
million USD
Loan allocation for
hospital and motorway
projects.
121.33
million MWh
MWh the amount of clean
energy generated through
the projects financed by
İşbank in the last 3 years
97%
ratio of transactions
out of total
transactions made
through non-branch
channels at İşbank
56.5 hour
average training time
per employee
30 thousand
chess classes opened in
schools in total
2.8 million
social media
followers
99.8%
ratio of return from
maternity leave
~15 million
digital banking
customers
53%
ratio of female
employees
3 million
Nays users
40%
ratio of women in
management
1.63%
employee turnover
rate
13.7million
İşCep users
97.2%
unionization rate
94%
ratio of Local
Suppliers
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An Overview of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report İşbank from 1924 to Today
The story of İşbank, which was established as our country's first national bank based on Gazi
Mustafa Kemal Atatürk's idea that political independence could only be possible through
economic independence, is parallel to the history of the Republic. Established to achieve more
with less with Atatürk's directive "Establishing a truly modern and national bank, born from the
direct reputation and trust of the people, as one of the primary measures that will liberate and
elevate the country..." , İşbank has always been a Republican institution that is much more than a
bank.
İşbank's pioneering achievements
1920s-1930s
䬕 The “İşbank Moneybox” was offered to the public
in order to create and popularize the habit of
saving.
䬕 Checks were introduced for daily transactions.
䬕 The foundations of electronic banking were laid
in our country.
䬕 Bankamatik ATMs, named and introduced by
İşbank, became the name of the service in this
field.
䬕 İşbank opened the first Turkish bank branches in
Europe and Cyprus.
䬕 The first Savings Account service was
introduced.
䬕 The first Mutual Fund was established.
䬕 The first securities trading was organized within
the Bank and the savings of our customers
increased in value.
䬕 The first interactive telephone banking service
was provided.
䬕 In 1997, Türkiye's first Internet Branch was
launched.
䬕 Netmatik machines were introduced to the
market so that customers without access to
PCs could also benefit from the opportunities of
Internet Banking.
䬕 With WAP, banking transactions were brought to
mobile phones for the first time in Türkiye.
䬕 Finger Vein Recognition Technology, one of
the most advanced technologies in its field,
was introduced to the Turkish banking sector,
providing a high level of security and speed in
identity verification operations with the biometric
application.
䬕 Parakod, Türkiye's first payment system using QR
(Quick Response) code, was made available for
customers.
1950s
1960s-1970s
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. İşbank was
the first Turkish bank to establish
branches abroad, with the first
international branches opened in
Hamburg,Germany and Alexandria,
Egypt in 1932.
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.
In the 1960s and 1970s, İşbank
focused on extending its branch
network.
1980s
1990s
2000s
The Bank 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.
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.
Maintaining strong and stable
growth, İşbank relocated the
Bank's headquarters from
Ankara to Istanbul in 2000.
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.
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, USA in 2016 to
support digital transformation.
The Bank initiated the "Workup by İşbank"
Entrepreneurship Program to support high potential and
technology-focused initiatives (Startups) and began to
invest in technology-focused startup ventures by making
an investment commitment to the Maxis Innovative Venture
Capital Fund established within the İşbank Group. İşbank
established the "Innovation Committee" 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.
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.
2020s
During the extraordinary period of COVID-19 pandemic
conditions, İşbank demonstrated its support for households
and companies with special product and service applications.
With an innovative approach that brings agriculture and
technology together, agriculture-focused activities gained
momentum.
Considering its consolidated leadership in digital banking,
İşbank launched entrepreneurship branches with the
first startup-focused branch service model in Türkiye
with the vision of being the bank of entrepreneurship and
entrepreneurs.
İşbank joined the United Nations Net-Zero Banking Alliance
(NZBA) and committed internationally to continue and
increase its support for the transition to a carbon-free
economy.
You can access the history of İşbank at isbank.com.
tr/en/about-us/our-history
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An Overview of İşbankLooking Into the FutureHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Message from the Chairperson
Esteemed Stakeholders,
We had a very difficult and sorrowful start to 2023, the 100th
anniversary of our Republic, due to the earthquake disasters that
shook our country deeply. We suffered the loss of many of our
citizens, including our colleagues working in the region, in the
earthquakes, the impact of which was felt over a vast area. While
the mobilization of solidarity began across the country to heal the
wounds caused by this great disaster, we, as İşbank Group, provided
a comprehensive disaster relief package to ensure that the needs
in the region could be met and to provide permanent support to the
region. Today, we continue to do our best to ensure that our country
can leave the impact of these dark days behind us completely. On
this occasion, I wish Allah's mercy on those who lost their lives due
to the earthquake and express my condolences once again to their
relatives and our nation.
2023 was a year of significant developments in the world economy.
While the global economy continued to lose momentum in line with
the tightening steps taken by major central banks until the last quarter
of the year, divergences in growth between regions were noteworthy.
Concerns about a global recession, which had been on the agenda
from time to time, were largely replaced by expectations of a "soft
landing in economic activity". The easing of supply-side pressures
stemming from supply chain disruptions supported the containment
of inflationary effects on a global basis. Throughout the year, the
course of global economic activity and the decisions of central
banks as well as geopolitical developments, particularly the tension
in the Middle East and the Russia-Ukraine war, were influential
on the course of global risk appetite. Foreign capital continued to
be selective in its investment decisions especially in developing
countries.
In 2023, the determining factors in the performance of the Turkish
economy were the earthquake disasters and the economic policies
implemented. The Turkish economy grew by 4.5% in 2023. Despite
the weak course in major export markets, the annual decline in
commodity prices, particularly in energy prices, led to limited
expansion in the foreign trade deficit, while the expansion in the
current account deficit lost momentum in the second half of the year
thanks to the contribution of service revenues. On the other hand,
annual consumer inflation, which displayed a downward trend in the
first half of the year due to the base effect, resumed an upward trend
in the second half of the year due to the depreciation in TRY and the
increases in tax rates. In addition to the earthquake disaster, the high
inflation environment led to an increase in the budget deficit in 2023.
As of the second half of the year, policies that put the fight against
inflation more at the forefront were pursued, and simplification steps
were taken in macroprudential measures. Under these conditions,
Türkiye’s banking sector maintained its strong outlook and continued
to support economic activity.
Special projects for the 100th anniversary of our
Republic
In the 100th anniversary of our Republic, which we celebrate with
enthusiasm and pride, we continued our efforts to present permanent
and inclusive works to our country. The historical building, which
served as the Beyoğlu Branch of our Bank for 63 years, opened its
doors to art lovers as the İşbank Painting and Sculpture Museum on
October 29th.
In March of the same year, we opened our exhibition titled "Long
Live the Republic! The First Steps of Economic Independence
in the Atatürk Era" at the İşbank Museum in Eminönü, Istanbul. In
September, we organized an international conference titled "Looking
to the Next Century with Atatürk's Vision", where we heard different
perspectives and reflections on Atatürk's visionary approach from
many guests from Türkiye and around the world who are experts in
their fields.
İşbank is 100 years old!
We are now entering another extremely important year for our Bank.
İşbank, the younger brother of the Republic by one year, will celebrate
its 100th anniversary in 2024.
Atatürk's words, "Political and military victories, no matter how great
they may be, cannot be permanent unless they are crowned with
economic victories", expressed at the Economic Congress convened
in Izmir in an environment where the wounds of the struggle for
independence were still healing, became the economic motto of our
Republic. With this understanding, our Bank, which was conceived "to
establish a nationwide bank with a large capital belonging exclusively
to Turks", was established in 1924 with the initiative of Atatürk himself.
Having taken responsibility for the development of our country
since day one, İşbank reached its 100th anniversary as an institution
guided by its founding values in all its activities. Creating value for
stakeholders, a culture of ethical, transparent, and accountable
business conduct, and a long-term perspective have always been
among the most fundamental principles of sustainable development.
In this respect, we are delighted to see that İşbank has succeeded in
combining these deep-rooted values with modern requirements and
has established a strong position among the leading institutions in its
field.
Contribution to sustainable growth
As a brand identified with trust and reputation in our sector, we
believe in the power of common sense in solving global problems
and adopt the approach of doing business together. We are a
signatory and member of many leading sustainability initiatives,
including the Net-Zero Banking Alliance, the United Nations
Environment Program Finance Initiative, the United Nations
Women's Empowerment Principles, and the Global Compact.
Within İşbank Group, we are a large community that supports
Türkiye’s sustainable growth and development with our
employment, exports, production, and services. We develop
products and services to support the real sector and households
with our widespread service network and digital contact points.
In the coming period, we will continue to utilize our resources for
Türkiye with determination.
Esteemed Stakeholders,
As we leave behind our centenary year, we continue our efforts
with the vision of becoming the bank of the future in line with global
developments and new regulations. In this process, on behalf of
the Board of Directors, I would like to extend our gratitude to all our
stakeholders, especially to the people of İşbank, whose efforts have
brought us to this day.
Yours sincerely,
Adnan Bali
Chairperson
Adnan Bali
Chairperson
We are delighted to see that
İşbank has succeeded in
combining deep-rooted values
with modern requirements
and has established a strong
position among the leading
institutions in its field.
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Esteemed Stakeholders,
Having started with the joy of celebrating the 100th anniversary of
our Republic, 2023 turned into a challenging year in every sense
due to the earthquake disasters on February 6th, which shook us
all deeply. We have tried to come out of the difficult times in which
we were put to the test with human life through the healing power of
social solidarity. Although we suffered great losses, we quickly took
action to shoulder our responsibility. On behalf of İşbank Group, we
donated TL 1 billion to AFAD for the earthquake region and provided
TL 1 billion 750 million in support for earthquake housing to be built.
In addition to the TL 10 billion we allocated in the first phase with our
disaster aid package, which we implemented to heal the wounds in
the region and to initiate production and employment mobilization, we
made the decision to defer or write off loan payments in the provinces
and districts that suffered severe damage in the earthquake.
Although it will take a long time to heal the wounds in the region, I
believe that we will overcome these difficult days with the solidarity
we have shown as a nation since the first day.
2023 was a year in which the global economy continued to lose
momentum in parallel with the tightening steps taken by central
banks to combat inflation worldwide, especially in developed
countries. According to IMF, the global economy, which grew by 3.5%
in 2022, is predicted to have completed 2023 with a growth rate
of 3.1%. In this period, global inflation declined but remained above
central banks' targets. Having tended to raise policy rates throughout
2023, major central banks preferred to maintain interest rates at the
level reached in the last months of the year in order to observe the
effects of the tightening measures implemented.
Despite the earthquake disasters at the beginning of the year, which
affected a vast area, the Turkish economy grew by 4.5% year-on-
year in 2023. Having declined in the first half of the year largely due
to the base effect, annual CPI inflation resumed an upward trend as
of June due to the depreciation of the Turkish lira and the increases in
tax rates. In this framework, tightening steps in monetary policy came
to the forefront in the second half of the year. The increase in the
current account deficit lost momentum in the second half of the year
with the contribution of tourism revenues.
İşbank continued to display a successful performance in this
challenging environment with its effective risk management and
quick decision-making skills. Our total asset size reached TL 2,453.8
billion, up 74.2% year-on-year, while cash loans increased to TL
1,147.4 billion and non-cash loans to TL 427.4 billion, and our total
contribution to the economy was TL 1.6 trillion. Throughout the year,
in addition to the soundness of our financial structure, the holistic
approach we adopted in digitalization, sustainability, competent
human resources, customer experience, and subsidiary strategy was
one of our greatest strengths.
100th Anniversary of İşbank
In 2024, we are celebrating the 100th anniversary of the
establishment of our Bank, which was founded as the first national
bank of our country with the visionary approach of Gazi Mustafa
Kemal Atatürk. This institution, which is nearly as old as the Republic,
has taken on and continues to take on important responsibilities for
our country since its first day.
In addition to our main fields of activity, we also endeavor to
contribute to social life in areas such as education, culture, arts,
science, and sports through the projects we carry out. In 2023, in
cooperation with the Turkish Marine Research Foundation (TÜDAV),
we launched the "Future of the Seas: Seagrass Meadows" project,
which aims to protect the last Posidonia oceanica seagrasses, which
are critical to the health of the Marmara Sea. In 2023, Deniz Kaşifi
(Sea Explorer), an unmanned underwater glider that was put into use
by the Middle East Technical University (METU) Institute of Marine
Sciences in the previous year, continued its underwater activities in
the Marmara and Mediterranean Seas.
In 2023, we contributed to the spread of sports to large masses
by assuming the title sponsorship to the Istanbul Marathon and
Half Marathon for two years, making sports more accessible and
enjoyable. At the same time, we continue to support our athletes
who will represent our country at the 2024 Paris Olympics within
the scope of the cooperation we started in 2022 with the Turkish
National Olympic Committee.
As part of the "Show Your Report Card, Get Your Book" campaign,
one of the most widespread and long-lasting book projects in Türkiye
to date, we prepared a special book titled "Çocuklar Soruyor Tarih
Dede Anlatıyor" in cooperation with İşbank Cultural Publications
and Darüşşafaka on the occasion of the 100th anniversary of the
founding of our Republic. We continued our sponsorship of the
Turkish Chess Federation, which started in 2005, by expanding it
with the 100th Anniversary of the Republic of Türkiye İşbank Chess
Cup and the "Minik Hamleler" project aimed at spreading chess to
kindergartens.
We support sustainable transformation in the
economy
We are aware that the finance sector plays a very important role
in building a sustainable economy. As a signatory of the Net-Zero
Banking Alliance (NZBA) within the scope of our decarbonization
efforts, we have announced our science-based intermediate
emission reduction targets with the efforts we have initiated to
manage the impacts arising from our loan portfolio. With our NZBA
commitment, we aim to reduce the emission intensity financed by
our Bank by 61% in the power generation, 21% in cement, and 10% in
iron and steel by 2030 compared to the base year 2021. In line with
our commitment to transparency-lined, systematic annual reporting,
in 2024, we will be conducting targeting studies for other carbon-
intensive sectors, report the progress on the initial targets we have
set, and create our transition plans including the portfolio actions we
will recommend to our customers.
In a move to bolster the green transformation within the economy,
İşbank has declared its intention to progressively phase out coal
financing by the year 2040, alongside the intermediate targets set
for the Net-Zero Banking Alliance. In 2020, we have announced our
commitment to refrain from financing new investments in coal and
natural gas-based thermal power plants for electricity generation and
pledged not to finance new coal mining activities in 2021.
In 2023, we continued to hold Green Transformation at SMEs
meetings and provided the real sector with the know-how it needs
to transition to a green economy. With the Water Platform technology
developed specifically for SMEs, we supported businesses in
reducing both water costs and water-related energy costs. We
continued to provide resources for renewable energy investments,
one of the most important components of the green economy. The
resources we provided for renewable energy projects, which have
a 77% share in our power generation projects portfolio, totaled
USD 6.8 billion. In 2024, we aim to accelerate both the digital and
green transformation of SMEs, the backbone of the economy, with
the "Twin Transformation Journey of 100 SMEs" project, which we
implemented in cooperation with the MEXT Technology Center.
Hakan Aran
Chief Executive Officer
We are preparing for our second
century with the awareness of
the greatness of the heritage we
carry.
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We had a year in which we continued to diversify our resources in
the field of sustainable finance by adding new resources. The total
amount of sustainability-themed resources we provided during the
year reached USD 2.4 billionThis year, wehad an outstanding green
bond issuance with the amount of TL 500 million with a 2-year
maturity . The transaction is labelled as the first green debt instrument
issuance in TL denominated by the banking sector in the country.
New initiatives in agriculture
Food safety is among the most important issues in sustainable
development. We continue our efforts in this area in order to support
the agricultural sector and ensure the sustainability of the country's
agriculture. Our goal is to popularize sustainable practices that
increase productivity in agriculture and are supported by technology.
To this end, we increased the number of our agriculture specialized
branches in 2023. We aim to open more than 50 Agriculture
Specialized Branches in the 100th year of our Bank.
In the first phase of the project, which we launched in cooperation
with our Bank and the European Fund for Southeast Europe (EFSE)
and under the consultancy of the Frankfurt School, we started to
measure the carbon footprint of producers in four main product
groups. Ultimately, we aim to develop product-specific banking
solutions that reduce carbon footprint.
We continued to support the agricultural activities of our farmers
with our mobile application İmeceMobil, a platform specific to the
agricultural sector. We became an 8.3% shareholder in the Izmir
Agricultural Technology Center through our subsidiary İmeceMobil.
We established the "İmeceMobil Agriculture Platform", which provides
digital agricultural technology services to small and medium-sized
farmers with the aim of supporting sustainable, efficient agricultural
production in the agriculture sector, which is among our strategic
priorities, and using technologies in the field of digital agriculture
correctly and spreading them to the grassroots.
We are Building the Bank of the Future
Our Bank, which has broken ground many times in terms of
digitalization of banking and technological innovation in our country,
continues to offer secure products and services to its stakeholders
without slowing down with the vision of being the "bank of the future"
as it prepares for its second century. In 2023, the number of our
digital banking users reached approximately 15 million.
Launched as Türkiye’s first mobile banking application and serving
5 million users every day, İşCep received the "World's Best Mobile
Banking Application" award at the "Best Digital Bank Awards"
organized by the international finance publication Global Finance. Our
Maxi application won the "Best Chatbot Technology" award at the
MarTech Technology Awards.
We are an important financial provider for an inclusive
economy
As the bank of Türkiye and the future, we are working with the goal
of providing products and services for all segments of society. Our
aim is to make the highest contribution to our country by offering our
technological capabilities, experience, and financial strength together
in the best way where needed. We continue our efforts in line with
our commitment to contribute to the transformation of the economy
by providing sustainable financing amounting to TL 300 billion by
2026 with the aim of creating inclusive, sustainable, and shareable
economic value.
With this approach, in 2023, we continued our efforts for SMEs,
which are the locomotive of the Turkish economy, and diversified our
products and services, especially for women's participation in the
economy.
With the "Women's Empowerment Declaration", we demonstrate our
support for women to be more active in economic life with the goal
of providing TL 100 billion in financing to women business owners
within 5 years. The declaration includes issues such as women taking
a more active role in business life, having equal rights, facilitating
access to financial services, preventing discrimination and implicit
prejudices in marketing activities, and developing practices that
consider all stakeholders in the value chain and create a positive
impact.
In addition, we launched the "Internet for 100 Villages" project on the
occasion of the 100th-anniversary celebrations of the Republic of
Türkiye and İşbank. With this Project, we aim to expand the availability
of the advantages offered by technology in every field, from
education to economy, by providing internet access in rural areas.
We allocate resources to entrepreneurship and produce a multiplier
effect on the support we provide to the economy
We believe that supporting the entrepreneurship ecosystem
is of great importance for our country to be among the world's
leading economies. For this reason, we have been accompanying
entrepreneurs for many years and providing them with both financial
support and knowledge.
The 11th term of the Workup Entrepreneurship Program, which has
continued uninterruptedly since 2017 under the main support of our
Bank, and the 2nd term of Workup Agri, an acceleration program
focused on agricultural technologies, took place. The program has
produced more than 100 graduates in 5 years. In addition to the
Workup and Workup Agri Entrepreneurship Programs, in 2023, we
launched the Workup Gaming program, which aims to accelerate
education-focused gaming technologies. We won the Golden
Sardis award in the "Most Innovative Acceleration and Incubation
Programs" category with Workup, Workup Agri, and Workup Gaming
Entrepreneurship Programs.
We moved our entrepreneurship programs, particularly Workup
and Workup Agri, to İş Towers, thus transforming İş Towers, where
our Istanbul Entrepreneurship Branch is also located, into an
entrepreneurship base.
In 2023, we launched Proemtia, the first digital marketplace platform
in its field in our country. With this platform, we aimed to contribute
to the development and digitalization of industrial commodity trade.
Proemtia is primarily used for iron and steel industry products and
will expand its field of activity and volume to include other industrial
products in the future.
As İşbank Group, in line with our mission to be the leading bank of
digitalization, entrepreneurship, and initiatives in our country, we
decided to invest in GetirFinans, which was born as a new initiative
and became a strategic business partner. Thus, with platform
banking, we aim to meet the financial needs of our customers on
the platform where they make transactions and on our own digital
channels when needed.
Consolidation of subsidiaries
In 2023, we took a strategic step and decided to consolidate our
subsidiaries under a new company to be established under 100%
ownership of our Bank for more effective management. With this new
structure, we aim to adopt a more focused and strategic management
approach with a systematic approach required by the rapid changes
in every field in the world. In addition, we aim to increase the synergy
between the subsidiaries, manage the subsidiaries more dynamically,
and achieve a competitive performance that increases the value of
the subsidiary portfolio and maximizes profits through increased
efficiency.
Next-generation working environments
The greatest strength of our Bank, which has been carrying out
its banking activities with competent and ethical employees since
its establishment, has always been its human resources. With this
awareness, we implement practices that will both attract young
talents to the Bank and increase the satisfaction of our existing
employees. We integrate the working systems of the future into our
organization.
Considering the office usage needs of the new era, we are opening
modern regional offices called MaxiOfis in different provinces so
that our employees can carry out their work from "an İşbank Office"
anywhere they are located. In 2023, we opened one more office
each in Ankara, Izmir, Kayseri, and Mersin and made 12 MaxiOfis
locations available to our employees in 8 different provinces. In 2024,
we plan to adapt digital workspace components and technological
innovations that will strengthen next-generation working
methodologies to working life, thus supporting the phenomenon of
working together with technology.
We are also working to offer next-generation experiences to our
İşbank customers. In January 2023, we launched İş Mekân, a
next-generation experience space, which is the first of its kind in
our country, in order to go beyond banking services and meet the
needs of our customers holistically together with our subsidiaries
and to serve our customers, whom we contact digitally, in a physical
environment. İş Mekân, which started its operations in Nişantaşı and
serves an average of 20,000 visitors per month, is an ecosystem
where brands and platforms within the İşbank Group can meet with
visitors in addition to banking transactions.
Esteemed Stakeholders,
The rapidly changing conjuncture in the world and in our country
once again underlines the necessity for organizations to have strong
compasses in order to survive. As an institution that was founded to
achieve more with less and has always been much more than just
a bank, İşbank is an ethical, principled, and reputable institution that
works with the understanding of creating value for all its stakeholders
and that prioritizes the interests of the country. This positions us
among the most valuable brands of our country and our sector.
We at İşbank are preparing for our second century with the
awareness of the greatness of the heritage we carry. Without
compromising our vision of "being the bank of the future that creates
sustainable value with an inclusive and participatory approach", we
endeavor to reclaim and earn the title of "the bank of the future"
every day. Without deviating from the principles of our founder
Gazi Mustafa Kemal Atatürk, we are working with all our strength to
contribute to carrying our country above the level of contemporary
civilizations. In our second century, we will continue to offer reliable,
seamless, and personalized digital products and services supported
by new technologies.
I would like to extend my gratitude to all our stakeholders who have
trusted and accompanied us on this journey and to my colleagues at
İşbank who have always worked with great dedication.
Yours sincerely,
Hakan Aran
Chief Executive Officer
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Operating Environment:
General Evaluations
Global Economy
In 2023, while geopolitical uncertainties were still going on, the
relatively weak course of global economic growth continued, with
divergence among countries. Although inflation lost momentum on a
global scale, it continued to stay above central banks’ targets. Major
central banks, which continued to raise interest rates throughout the
year, preferred to wait to monitor the impacts of the tightening steps
taken in the last quarter of the year. In this environment, international
organizations assess that the risk of a global recession has
diminished and the possibility of a "soft landing" is gaining weight,
taking into account the above-expected course of economic activity
in the US and major emerging economies and the possible effects
of monetary and fiscal stimulus in China. According to IMF data, the
world economy, which grew by 3.5% in 2022, is estimated to have
grown by 3.1% in 2023 and is expected to display a similar outlook in
2024.
Turkish Economy
In 2023, the Turkish economy grew by 4.5% thanks to the continued
strong course of consumption expenditures and the contribution
of the increase in investment expenditures due to the earthquake
disaster. In line with the tightening trend in economic policy, growth is
expected to lose some momentum in 2024.
Despite the favorable performance of budget revenues, particularly
tax revenues, increased budget expenditures due to the earthquake
disaster and high inflation caused the budget deficit to widen rapidly
in 2023. The budget deficit, which stood at TL 1.4 trillion throughout
the year, widened to 5.2 % of GDP. In 2023, the decline in energy
prices was effective in narrowing the foreign trade deficit. In this
period, services revenues, especially tourism, displayed a positive
performance. Thus, the current account deficit narrowed by 8% year-
on-year to 45.2 billion USD.
Annual inflation, which declined in the first half of the year due to the
high base effect, regained momentum in line with the depreciation
in TL, tax adjustments, and wage hikes since June. As of December
2023, annual CPI inflation rose to 64.77%, while D-PPI inflation
amounted to 44.22%. The CBRT raised the policy rate since June to
42.5% as of December as part of the campaign to fight inflation. The
CBRT also took various steps towards simplifying macroprudential
measures, increasing the share of Turkish lira deposits, selective
lending, and quantitative tightening. The normalization steps taken in
economic policies led to an improvement in risk perception towards
Türkiye, with Türkiye's 5-year CDS premium declining from around
700 basis points at the end of May to 280 basis points by the end of
the year.
IMF Forecasts (January 2024)
2023
2024
2025
Growth
World
Advanced Economies
USA
Euro Area
UK
Japan
Emerging Economies
Türkiye
Russia
China
Brazil
Inflation
Advanced
Emerging
Increase in World Trade Volume
3.1
1.6
2.5
0.5
0.5
1.9
4.1
4.0
3.0
5.2
3.1
4.6
8.4
0.4
3.1
1.5
2.1
0.9
0.6
0.9
4.1
3.1
2.6
4.6
1.7
2.6
8.1
3.3
3.2
1.8
1.7
1.7
1.6
0.8
4.2
3.2
1.1
4.1
1.9
2.0
6.0
3.6
Türkiye Inflation Indicators and
Currency Basket (annual % change)
200
150
100
50
0
-50
D-PPI
CPI
Currency Basket
2017
2018
2019
2020
2021
2022
2023
Banking Sector
İşbank
The banking sector maintained its strong outlook in 2023 and
continued to support economic activity. According to the Weekly
Bulletin data published by the Banking Regulation and Supervision
Agency, the volume of Turkish lira loans, including loans to the
financial sector, increased by 53.5% on an annual basis, reaching
TL 7,293 billion as of December 29, 2023. In USD terms, FX loan
volume decreased by 3.5% to USD 121.6 billion in the same period.
Accordingly, the total loan volume expanded at a rate of 52.9% as
of December 29, 2023 and reached TL 10,859 billion. According to
the exchange rate adjusted data, the total loan volume expanded by
34.7% in this period.
As of December 29, 2023, the volume of TL deposits, including
deposits of banks, increased by 85.9% and reached TL 8,308 billion
compared to the same period in 2022. In USD terms, FX deposit
volume decreased by 8.2% to USD 191.3 billion in this period. The
volume of FX-protected deposits, which peaked at TL 3.4 trillion in
August, started to decline following the announcement of the exit
strategy on August 20, falling to TL 2.6 trillion as of December 29.
Thus, as of December 29, 2023, total deposit volume increased by
66.5% year-on-year to TL 13,919 billion. According to the exchange
rate adjusted data, the annual increase in total deposit volume was
42.1%.
Deposits and Loans in 2023
(Change Compared to Year-end, %)
TL Deposits
Loans
FX Deposits
(USD)
100
80
60
40
20
0
-20
In 2023, the banking sector was shaped by macroprudential
measures in the first half of the year and by the CBRT's simplification
and normalization steps aimed at increasing the functionality of
market mechanisms and strengthening macro financial stability in
the second half. In this conjuncture, by focusing on effective risk
management and maintaining balance sheet management with a
dynamic perspective, İşbank increased its asset size by 74.2% to
TL 2,453.8 billion as of year-end 2023 and maintained its title as
"Türkiye's largest private bank".
Continuing to support the Turkish economy in a wide range of
areas from the needs of households to the financing of Türkiye's
large-scale investments, İşbank increased its cash loans by 51.1%
compared to the end of the previous year. As of the end of 2023, the
amount of resources provided by the Bank to the economy amounted
to TL 1.6 trillion, of which TL 1,147.4 billion was cash loans and TL
427.3 billion was non-cash loans. Thus, İşbank continued to be the
private bank making the largest contribution to the national economy.
İşbank's deposits increased by 78.5% compared to the end of the
previous year, reaching TL 1.7 trillion. While the "liraization" strategy
continued to shape the composition of deposits in 2023, Turkish
currency deposits increased by more than 128% in this period. İşbank
maintained its leading position among private banks not only in total
deposits but also in demand deposits.
Continuing to improve its asset quality indicators in 2023, İşbank's
NPL ratio declined to 2.1% from 3.0% at the end of the previous year.
Maintaining its strong liquidity level in 2023, İşbank's total liquidity
coverage ratio and foreign currency liquidity coverage ratio were
realized at 185% and 327%, respectively.
İşbank maintained its leading position among private banks with its
shareholders' equity, which increased by 39.9% in 2023 compared
to the previous year and reached TL 267.8 billion. With a capital
adequacy ratio of 21.6% in 2023, İşbank became one of the banks
with the highest ratio in the sector.
Contributions to GDP by Expenditure Method (%)
Source: Monthly Bulletin Data (Excluding Participation Banks)
J
F M A M J
J
A
S O N D
11.4
5.5
4.5
3.0
0.8
1.9
10
0
-10
2018
2019
2020
2021
2022
2023
Private Consumption
Investment
Net Export
Public Consumption
Stock Change
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Opportunities and Forecasts
Climate Crisis
According to the World Economic Forum's 2023 Global Risks
Report, failure to mitigate and/or adequately adapt to climate change,
natural disasters, biodiversity loss, and environmental degradation
represent five of the top 10 risks for our world. The report warns of
highly interconnected risks, noting that climate change is triggering “a
range of interlinked global risks”, including economic tensions, energy
and food supply shortages, increases in the cost of living, and debt
payment capacity. On the other hand, it was also stated that there
is an opportunity that the connections between global risks offer a
dimension that may be leveraged to reduce risks.
As the final declaration of the 28th Conference of the Parties to the
United Nations Framework Convention on Climate Change (COP28)
closed in Dubai shows, global performance in this area needs to
be improved and efforts need to be accelerated. According to the
final declaration, the most important and urgent need for increasing
climate resilience, meeting climate damages, and the transition
economy is access to finance.
The COP28 final declaration provided important clues on the
focus areas that stand out in the global action plan to fight climate
change. The Global Stocktake (GST) agreed upon at COP28 called
for a significant increase in renewable energy capacity and energy
efficiency improvements by country parties. While 118 countries
signed the Global Renewables and Energy Efficiency Pledge, Türkiye
was not among the signatories. In the decision text of the COP28,
countries party to the Framework Convention on Climate Change
called for "an orderly and equitable transition away from fossil fuels
in energy systems, accelerating actions in this critical decade so that
net zero is achieved by 2050”. This was the first time that the term
“fossil fuels” was included in a COP text. Türkiye, which has not yet
announced its National Climate Action Plan and has not yet enacted
its Climate Law, has also declared that it wants to benefit from the
Loss and Damage Fund.
According to the Financial Stability Oversight Council Climate-Related Financial Risk report published in July 2023, three main
categories of climate risk for the banking and finance sector are highlighted:
Credit Risks
Market Risks
Operational Risks
can increase substantially due to physical
climatic events, regulatory changes
due to climatic events, and changing
customer behaviors. Extreme natural
events can lead to the deteriorating
financial performance of agricultural
customers; severe weather events can
damage properties and lead to increased
loan defaults. Thermal power plants may
be restricted or shut down as a result of
their inability to meet increased emission
standards.
the physical risks of climate events pose
a threat to all assets exposed to severe
weather events, leading to balance
sheet losses. Transition risks in financial
markets include expectations regarding
technology, regulations, and changing
consumer preferences, as well as the
potential decline in the value of assets
that are considered high climate risk, such
as carbon-intensive energy generation
and other emission-intensive products,
services, or technologies.
physical climate risks can impact
both face-to-face and digital banking
experiences. Financial institutions and
service providers need to have backup
technology in place to remain operational
if a severe weather event impacts critical
functions such as data centers. On the
transitional risk dimension of climate
change, financial institutions are expected
to face much stricter regulations, resulting
in higher operating costs and more
complex cross-border transactions.
In the case of Türkiye, Regulatory Risk: regulations such as the
Emissions Trading System (ETS) or the Carbon Border Adjustment
Mechanism (CBAM) may reduce the profitability of customers and
increase the probability of default. This may reduce the Bank's
asset quality. Within the scope of reputational risk, reputational
damage may occur due to failure to meet the climate change actions
expected from banks, and access to capital and financing may
become difficult.
As institutions that direct finance, banks play a crucial role in tackling
the climate crisis. Banks can make significant contributions to the
fight against climate change by providing resources to startups
² Climate-related Financial Risk: 2023 Staff Progress Report
24
working in the field of climate innovation, supporting the green
transformation of emission-intensive sectors, reducing the emission
intensity of their own portfolios, and raising the awareness of their
customers. Banks, which are an important point of contact for
customers and have professionals with knowledge and experience in
climate action, can help deepen knowledge in this area and channel
investments correctly.
How do we manage? Please visit the “Climate Action”
section for details on İşbank's practices and performance in this
area.
Generative Artificial Intelligence
Integration of artificial intelligence and big data applications into
banking systems is a global trend that has been on the agenda for
a long time. Automated customer identification and authorization,
the creation of responsive and conversational interfaces for front-
end banking, and applications based on powerful analytical data
to enhance anti-fraud and risk management are some of the most
prominent use cases for artificial intelligence (AI) and machine
learning (ML) in banking. While these use cases remain essential,
a notable development in AI that is redesigning the technology is
generative AI (Gen AI).
Generative AI, a subset of artificial intelligence focused on natural
language processing and content production, stands out with
promising potential for the banking sector, especially to use for
improving customer services and experience. Although it is still
in its early stages of development, generative AI is an extremely
important development in terms of a safer and more efficient banking
experience.
A study by McKinsey revealed that this technology can reduce
operational expenses in the banking and finance industry by $200 to
$300 billion and increase efficiency by 3-5%. The biggest impact is
expected in sales, marketing, customer relations, investment services,
and risk and legal departments.
How do we manage? Please visit the “Innovative Bank
for 100 Years“ section for details on İsbank's practicies and
performance in this area.
New Regulations and Risk Management
In parallel with global regulations, efforts to prepare local legislation
on fighting climate change and sustainability are accelerating.
Draft regulations and guidelines on Green Asset Ratio, Sustainable
Reporting Standards, and Effective Management of Climate-Related
Financial Risks by Banks are expected to enter into force. These
regulations increase banks' obligations regarding the management of
climate risks.
At the same time, many developments such as climate change,
new business models, and crypto-assets expose companies to a
volatile risk environment and the legal regulations arising from these
risks. Financial institutions, for which risk management is of utmost
importance, need to monitor the constantly evolving risk environment
and exhibit proactive approaches. While macroeconomic risks such
as inflation and uncertain growth expectations create potential credit
challenges, risks such as changing regulations, cyber-attacks and
fraud, integration of artificial intelligence into the banking system, and
ever-changing climate risks constitute important new risk areas.
The coming period is expected to witness significant regulations
affecting the financial sector. For example, in the USA, as part of Basel
III, the FED is preparing to implement refined capital rules for banks
with assets of over USD 100 billion. This regulation will standardize
credit and operational risk approaches by 2028. It will also change
the required bank capital for securitization risks.
As of January 1, 2024, publicly listed large companies in the EU will
have to comply with the Corporate Sustainability Reporting Directive
(CSRD) when preparing their annual reports for 2025. The key
requirement under the CSRD will be a dual materiality assessment,
which assesses the impact of a company's activities on both its
own finances and on wider society and the environment. Smaller
companies will also face the same rules from 2025 on.
How do we manage? Please visit the “Transparent and
Ethical Management“ section for details on İşbank's practices
and performance in this area.
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Opportunities and Forecasts
Stable Cryptocurrencies
Stable cryptocurrencies, a type of cryptocurrency whose value
is pegged to a currency such as the US dollar or the Euro, have
emerged as a tool to help smooth out the volatility in the value of
other cryptocurrencies such as Bitcoin and Ethereum, which have
seen large fluctuations in value.
In August 2023, the USA positioned itself as a leader in the stable
cryptocurrency area after PayPal announced the launch of PayPal
USD. PYUSD was the first official stable cryptocurrency launched by
a US financial firm, marking a significant milestone for this technology.
In the European Union, stable cryptocurrencies have been
around longer and are being launched by more companies. The
European Banking Authority has begun the process of setting
MiCA requirements for stable cryptocurrencies, with the proposed
regulations expected to come into force in 2024.
Central Bank Digital Currencies (CBDCs) are being supported by
governments around the world, either to increase financial inclusion
or because they provide more efficient payment methods. A global
agreement on minimum standards for cryptocurrency governance
is likely to emerge after the Financial Stability Board in the USA and
the IMF raised concerns about financial stability and macroeconomic
risks.
Blockchain and Crypto Asset Regulations
The year 2023 saw SEC lawsuits against major crypto exchanges
such as Coinbase and Binance. With these lawsuits, regulators
around the world began to focus on blockchain and related
technologies. While most of the regulatory changes related to
blockchain were specifically related to cryptocurrency, other
blockchain-based projects and products remained in a legal gray
area.
One of the most significant developments in blockchain and
crypto regulations last year was the European Union's Markets in
Crypto Assets (MiCA) regulation. This legislation covers currently
unregulated crypto assets and aims to promote both market
integrity and financial stability. MiCA also aims to provide consumers
with more information to make more informed decisions about
cryptocurrencies and the associated risks.
Technology Investments and Digital Core
The transformation of banks into technology companies is a long-
standing trend. According to recent research reported by The
Financial Brand ⁵, 79% of financial institutions plan to increase
their technology spending over the next two years. Research
by Gartner ⁶ predicts that global spending on banking and
investment technology services will exceed USD 652 billion by the
end of 2023. This figure represents an increase of 8.1% compared to
2022.
Today, digital solutions are not just about solving specific problems or
supporting existing systems. Having a modern digital core based on
advanced technologies like digital and cloud, as well as innovative tools
such as artificial intelligence and machine learning has become a vital
requirement for organizations, not a convenience or added value.
A robust corporate digital core is a trend emerging as the foundation for
ensuring competitiveness, overall customer satisfaction and product
innovation, scalability and flexibility, and total cost efficiency across the
entire platform.
Leveraging technology and AI to increase efficiency, better utilize
talents, and improve the delivery of products and services is
increasingly becoming a critical differentiator for banks.
How do we manage? For details on İşbank's practices and
performance in this area, please visit the “Innovative Bank
for 100 Years” section.
Open Banking
Open banking is evolving all over the world, but it is taking different
forms in different parts of the world. For example, the United Kingdom
has adopted the Open Banking Standard, while the European Union
is currently regulating open banking under the PSD2 regulation (soon
to be PSD3). These regulatory standards are paving the way for open
banking adoption in other regions. Deloitte reports that Hong Kong
and Australia are adopting a more regulatory-driven approach to open
banking, similar to the approach seen in the UK and EU.
The USA is a major player that has not yet adopted comprehensive
open banking legislation, but the Consumer Financial Protection
Bureau (CFPB) is working to publish a new personal data rights
regulation that will accelerate the adoption of open banking in the USA.
The regulation is scheduled to be published in 2024.
³ A company is defined as large if it meets two of three criteria: Having more than
250 employees, a turnover of more than EUR 40 million, or total assets of more than
EUR 20 million.
⁴ “The economic potential of generative AI: The next productivity frontier,” McKinsey,
June 14, 2023.
How do we manage? For details on İşbank's practices and
performance in this area, please visit the “Innovative Bank
for 100 Years” section.
Cybersecurity
Rapidly increasing digitalization, integration of artificial intelligence,
the banks' increasing number of business partners due to open
banking applications, and “deepfake” incidents that gradually become
more realistic with artificial intelligence technologies continue to
emphasize the importance of cybersecurity measures. Ensuring
cybersecurity and the trust created among customers in this regard
provide a significant competitive advantage for financial institutions.
According to the IBM Cost of a Data Breach Report 2023, the global
average cost of data breaches is USD 4.45 million, up 15% in 3 years.
In the Deloitte Global Future of Cyber Survey, 56% of respondents
reported being moderately or severely impacted by cyber incidents
and breaches, including operational disruption, revenue loss,
reputational damage, and intellectual property theft.
How do we manage? Please visit the “Information
Security at İşbank” section for details on İşbank's practices
and performance in this area.
Access to Talent
One of the most important elements in creating a competitive
advantage for organizations across the world is to access
talented employees and ensure employee commitment. As the
technological transformation of financial institutions accelerates,
there is an increased demand for technically qualified employees,
especially in the fields of artificial intelligence and big data. Qualified
employees are in high demand in all sectors. Another requirement
for the technological transformation of institutions is to increase
the technological literacy of their current employees. Increasing
digitalization in all units, integration of artificial intelligence and big
data processing systems embedded into decision mechanisms
require all employees to have a minimum level of knowledge in these
areas. These developments require increased technology content in
employee development programs.
How do we manage? Please visit the “Decent Work”
section for details on İşbank's practices and performance in
this area.
Geopolitical Risks
According to the World Economic Forum's 2023 Global Risks Report,
conflicts and geo-economic tensions are triggering a series of deeply
interconnected global risks. These risks include shortages in energy
and food supplies, strong increases in the cost of living, and decrease
in debt payments, which are likely to continue in the coming years.
These crises also have the risk of undermining efforts to tackle long-
term risks such as climate change, biodiversity, and investment in
human capital.
According to a recent survey by Oxford Economics, companies see
geopolitical tensions as the biggest threat to the global economy. In
its biannual Financial Stability Report, the US Federal Reserve noted
that “geopolitical tensions pose significant risks to global economic
activity, including the possibility of sustained disruptions to regional
trade of food, energy, and other commodities”. The World Economic
Forum's 2023 Risk Report similarly placed geopolitical risks in the
top 10 list of both short-term (two-year) and medium-term (10-year)
global concerns.
A succession of crises has brought significant geopolitical
uncertainty, volatility, and fragility to markets. The war in the Middle
East, Russia's invasion of Ukraine, and US-China tensions have
accelerated geopolitical fragmentation. The humanitarian crisis
caused by the Russia-Ukraine conflict has also led to increased risk
exposure in capital flows, trade, and commodity markets around the
world. As geopolitical competition increases, so does the scope,
scale, and sophistication of cyberattacks.
How do we manage? Please visit the “Risk
Management” section for details on İşbank's practices and
performance in this area.
Changing Competitive Environment
The banking and finance sector is one of the sectors where
competition is changing the fastest today. Traditional financial
institutions have to compete both among themselves and with new
fintechs entering the industry. As the number of digital transactions
in retail banking transactions increases, the number of banks that
serve only as digital banks is also increasing. Applications such as
digital wallets, account-to-account money transfers, buy now pay
later, etc. are giving rise to alternative payment systems. Banks are
increasingly partnering with fintechs and other technology companies.
As the number of alternatives increases, customers' expectation of
communication from multiple sources increases and brand loyalty
decreases.
How do we manage? For details on İşbank's practices and
performance in this area, please visit the “Innovative Bank
for 100 Years” section.
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Sustainability Leader
Esteemed Stakeholders,
In the business world, where global dynamics change, consumer
behavior shifts, and the importance of human capital increases,
sustainability comes to the forefront as one of the key elements
shaping the future. As İşbank, a bank that has integrated
sustainability into all its processes with the vision of "becoming
the bank of the future that creates sustainable value", and as we
enter our 100th anniversary and perform at international standards
in this field, we develop all our activities and services in the light
of scientific studies and in consideration of changing stakeholder
expectations.
As an institution nearly as old as the Republic, contributing to the
economic and social welfare of our country has been the most
important mission of our Bank since our founding. Creating an order
that is inclusive, environmentally responsible, and fair while ensuring
social welfare can only be possible through the integration of
environmental, social and governance factors into decision-making
processes. Based on this necessity, we carry out our sustainability
efforts in coordination and cooperation with the participation
of all relevant departments of our Bank, covering governance,
coordination, strategy, marketing and operational processes in line
with systematic and international best practices.
The Sustainability Committee, which operates under the Board of
Directors, the highest governance body of our Bank, also includes
members of the Board of Directors and the Executive Board. This
governance structure ensures that our sustainability activities are
managed from a holistic perspective and that interdisciplinary
interaction is supported.
Our Efforts for a Sustainable Economy and Future
In order to combat climate change and accelerate the transition
to a low-carbon economy, we adopt an end-to-end business
model that extends from procurement of resources to provision of
these resources to our customers through sustainable products
and services. We aim to reduce emissions resulting from our own
operations as well as those of our customers and suppliers. We see
decarbonization, especially from our loan portfolio, as one of the
top priorities in terms of emissions from our operations in building a
sustainable future.
In 2023, we procured 100% renewable energy for the electricity
consumed by our own operations, while implementing energy
efficiency measures. As of the end of 2023, we reduced our
emissions by 79%, while shifting our carbon-neutrality target from
2035 to 2026.
In 2022, as a signatory of the Net-Zero Banking Alliance established
at the United Nations, we made a commitment to align our loan
portfolio with science-based net-zero emission targets by 2050. In
this context, we prioritized supporting our customers’ transition to a
net-zero economy. In terms of emissions from loans, we started to
plan the actions to be taken by creating sectoral decarbonization
routes starting from carbon-intensive sectors. We puclicly disclosed
our 2030 targets for emission reductions in the energy, iron-steel
and cement sectors, which are among the carbon-intensive sectors
we prioritized in 2023. Accordingly, we aim to reduce emission
intensity by 61% in the energy production sector, 21% in cement and
10% in iron-steel by 2030 compared to the base year 2021. The
targets we have set represent a fundamental elements of our Bank's
sustainability strategy and reflect our aim to be a guiding business
partner in the green transformation of our customers. In parallel with
our decarbonization efforts, we also announced that we will gradually
phase out coal financing by 2040.
We evaluate climate change issues not only in terms of emission
reduction and adaptation but also in terms of the opportunities
created for the green transformation of the business world. In this
regard, our Bank continues its efforts to offer both product packages
and consultancy to its customers and to be a solution partner in their
transformation.
As a reflection of our ongoing efforts in the field of sustainability,
we raised our 2023 score to the "A" level, defined as the global
leadership category, in the CDP Climate Change Program, which we
have been reporting on since 2019. We also raised our score to the
"A-" leadership level in the Water Security Program.
Our Responsible and Inclusive Banking Efforts
As an organization that believes equal participation of all segments of
society in the economy and increasing the effectiveness of women in
business life are requirements of sustainable development, we carry
out activities that consider gender equality in our banking activities.
Being a signatory of the United Nations Women's Empowerment
Principles (WEPs), our Bank published the "Women's Empowerment
Declaration" in 2023, which sets out that women's economic
independence and their active role in business life are among the
Bank's strategic priorities. We have made a commitment of providing
TL 100 billion financing women entrepreneurs by 2028 and financial
literacy training to 15,000 women entrepreneurs. In our value chain,
we implement action plans that aim to develop new, innovative, and
good practices from end to end, from human resources practices to
financing/sales activities that affect customers, from procurement to
corporate social responsibility. In this way we aim to assist women
overcome economic difficulties and become more active in economic
life.
2023 was also a year in which we continued to increase the diversity
of transactions in sustainability-themed funding. In 2023, we
provided USD 2.4 billion worth of sustainability-themed funding to
our country, some of which was allocated to the earthquake region.
From the first day of the earthquake, we have aimed to maximize
the financial support we provide to the region by mobilizing both our
own and external resources and to make a permanent contribution
to recover the effects caused by earthquake disasters in the region.
With the resources we have provided, we will continue to increase
the support we give to areas such as renewable energy, energy and
resource efficiency, and to support women entrepreneurs in order to
increase women's participation in business life. We also broke new
ground in the sector this year by issuing a green bond worth TL 500
million with a two-year maturity. The transaction is the first green debt
instrument issuance in TL by the banking sector in Türkiye.
Developments in the Operating Environment
In 2023, the Public Oversight Authority decided to adopt the
standards published by the International Sustainability Standards
Board (ISSB), which was established under the International
Financial Reporting Standards (IFRS), to develop a transparent and
comparable reporting framework in the field of sustainability. The
Turkish Sustainability Reporting Standards (TSRS) were published
on the basis of "General Provisions on Disclosure of Sustainability-
Related Financial Information" and "Climate-related Disclosures"
fully compliant with IFRS. As İşbank, we closely follow the recent
standardization processes in the sustainability reporting universe,
both in terms of our own activities and those of our customers, and
we welcome the developments evolving towards a single standard
in this field. Throughout our integrated reporting journey, we have
had the opportunity to effectively manage our sustainability efforts,
assess our environmental and social impacts, set our sustainability
goals, and share these goals with our stakeholders in a transparent
way. Certainly our experience in reporting will provide a strong base
for the developments in international and local reporting practices
and standards.
I would like to thank all our stakeholders, especially our employees
and customers, for accompanying us on our sustainability journey.
At İşbank, we have been working with the aim of adding value to
the world, our country, and society for a hundred years under the
guidance of our founding values, and we make plans to shape our
second century with the same sense of responsibility in line with
these values. We invite all our stakeholders to take joint action with
us for a more livable world where all segments of society participate
equally in the economy, gender equality is achieved, and natural
resources are used responsibly.
Yours sincerely,
İzlem Erdem
Deputy Chief Executive
Sustainability Leader
İzlem Erdem
Deputy Chief Executive
Sustainability Leader
As İşbank celebrates its 100th
anniversary, the goals we
have set for decarbonization
represent the core elements
of our Bank's sustainability
strategy and reflect our aim to
be a guiding business partner in
the green transformation of our
customers.
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How Do We Create Value?
Sustainability at İşbank
The Turkish economy grew by 4.5% in 2023 thanks to the continued
strong course of consumption expenditures and the contribution
from the increase in investment expenditures due to the earthquake
disaster. The Turkish banking sector maintained its strong outlook in
2023 and continued to support economic activity.
In 2023, İşbank 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 2023, İşbank had largely achieved its 2023 targets
and maintained its title as "Türkiye's largest private bank" in terms of
total assets, loans, deposits, and shareholders' equity.
Loans accounted for 46.8% of İşbank's total assets of TL 2.5 trillion
as of year-end 2023. The Bank's total cash loans increased by 51.1%
in 2023. Compared to the end of the previous year, retail loans and TL
commercial loans increased by 89.2% and 36.6%, respectively, with
total growth in TL loans reaching 56.3%. FX loans contracted by 9.7%
in USD terms, which is in line with the previous year.
Deposits continue to be the main source of funding, with a 67.7%
share in total liabilities. In 2023, the Bank's total deposit volume
increased by 78.5%. The steps taken within the framework of
the liraization strategy were decisive in deposit development and
customer preferences, with TL deposits increasing by 128.1%, while
foreign currency deposits contracted by 9.1% in USD terms.
In 2023, our shareholders' equity and capital adequacy ratio
remained strong, supported by our net profit. In 2024, in order to
ensure that our strong financial structure and capital adequacy are
maintained under all conditions, we will prioritize the management
of our balance sheet with a proactive and prudent approach by
considering the risk-return balance.
In its second century, İşbank will be positioned as one of the leading
institutions building the future and will carry out all its activities with
the goal of creating sustainable value by putting people, society,
and the environment at the center. İşbank's strategic priorities
include providing an open, integrated, and seamless banking
experience to customers from all segments of society; creating
value in cooperation with key actors and sectors of the economy;
and supporting entrepreneurship, which is seen as the building
block of sustainable development and has a high potential to create
value for the economy. Just as İşbank helped lay the foundations
of industrialization in our country in the years of the establishment
of the Republic, it will continue to use the transformative power of
technological innovations, especially artificial intelligence, which
is considered to be the revolution of today, for the benefit of all its
stakeholders.
Aiming to create shareable and long lasting value for our country
since its foundation, İşbank’s sustainability approach has been
summarized as “İşbank Banking”.
Highlights in 2023
Our business model: İşbank Banking
İşbank is among the most reputable institutions in the finance sector
with its business approach based on ethical principles and trust.
Defined as "İşbank Banking", this model, which is integrated into all
of the Bank's processes and which handles financial and non-
financial capital elements together, reflects the unique corporate
culture that İşbank has built over 100 years. With this business model,
which focuses on "creating shareable and sustainable value" for
our country, 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 value creation approach.
2030 mid-term emission reduction targets were
announced in the energy, cement and iron and
steel sectors within the scope of the Net Zero
Banking Alliance commitment.
Committed to provide TL 300 billion in
sustainable financing by 2026 and TL 100 billion
in financing to women operators by 2028.
Achieved "A" Global Leadership score with the
CDP Climate Change Report.
CDP Water Security Report Rating raised to "A-"
Leadership level.
By 2040, it was announced that the financing of
coal activities will be gradually terminated.
First sustainable eurobond issuance realized.
Please visit https://www.isbank.com.tr/en/about-us/
our-approach for the principles of İşbank Banking.
The first domestic TL green bond issuance was
realized.
BIST Sustainability 25 Index was launched.
Participated in the FTSE4Good EM Index.
Published the "Women's Empowerment
Declaration" that considers all stakeholders in the
value chain.
Please visit
https://www.isbank.com.tr/en/about-us/sustainability-
milestones to review our past achievements.
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Inputs
Financial
Capital
Human
Capital
Broad customer bas -24,3 million
Strong capital structure
TL 2,453.8 billion asset size
21,167 employees
Practices that support employee satisfaction
and development
Strong rights policies that reinforce gender
equality and labour peace
Strong brand value
Effective stakeholder communication
New generation banking practices
Initiatives involved in sustainability – 18
Social-Relational
Capital
Centuries-old corporate know-how
Agile working model
Continuous investment in employee
qualifications
Value-creating technology and innovation
investments
Digitalised banking processes
Financing of 2,659 MW installed capacity
renewable energy projects
Energy and water used in operations
Extensive branch network – 1,066 domestic
branches
The largest ATM network in Türkiye – 6,312
Maxi, a personal assistant powered by
artificial intelligence and natural language
processing (NLP) technologies
Strong information systems infrastructure
Intellectual
Capital
Natural
Capital
Produced
Capital
sive Banking
clu
n
İn
d
i
n
a
a
e
b
s
n
o
p
s
t
s
e
l
i
R
u
r
e
y
o
Strong and
Sustainable
Financial
Performance
Effective Risk
Management
S
l
p
m
E
d
e
r
r
e
f
e
r
t
i o n
C li m
a t e A c
Digitalisation, Innovatio
abilit y Focu
Value Creator
Technology
and Innovation
Pioneering
Ethical and
Responsible
Banking
n a
s
n
d
C
y
b
e
r
s
e
c
u
r
A
i
y
t
Our Strategic
Elements
Happy and
Productive
Human
Resources
r
i
E
t
h
c
a
l
a
n
e
a
s
d Tra
n
sp
Permanent
Commitment
to Our
Country
arent Governan
Excellent
Customer
Experience
ibution to Social Welfare P
c
e Cont
r
Outputs
51.1% Cash Loan Growth in Total
TL 1,662.2 billion Total deposits
TL 72.3 billion Net profit
33.3% Average profit on shareholder equity
53% Percentage of female employees
40% Percentage of female employees in management
1.63% Employee turnover rate
97% Unionization rate
Individual Net Promoter Score Ranking 1.
(among private banks)
427 Number of graduates from the "81 Students from 81 Cities"
10.7 million users reached with Maxi
13.7 million Number of İşCep users
Over 16 thousand subscribers to ekonom.isbank.com.tr
1,660 employees and 225 Agile Team working with the
Agile working model
Over 3,600 farmers reached through
38 «Farmer Meetings»
100% The amount of energy generated from renewable
energy sources of the total energy consumption
77.3% Share of renewable energy projects in İşbank's total
energy generation projects portfolio
238 million pages Paper savings with digitalization
Renewable energy supply for 100% of electricity demand
6,312 Number of Bankamatik ATMs
87.3 million Number of questions answered with Maxi
BREEAM In-use Excellent certified Head Office building
LEED v4 Gold for Data Centers certified Tuzla Data
Centre (Atlas) building
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Positive Results
Risks / Challenges
Related Report Section
High profitability
Market share aligned with goals
High employee commitment
Increasing digital competencies
Financial
Capital
Human
Capital
The negative impact of the purchasing
power declining due to high inflation on
financial capital
The negative impact of uncertainties
caused by turbulent operating
environment on financial capital
The negative impact of decreasing
workforce due to increasing digitalization
on human capital
The negative impact of global trends such
as great resignation on human capital and
intellectual capital
Reliable Financial Actor
Decent Work
The positive impact of a large supply
pool on financial capital
Social-Relational
Capital
The positive impact of high customer
satisfaction on financial capital
The negative impact of increasing
digitalization on relational capital
Looking Into The Future
Reliable Financial Actor
The positive impact of low ESG risks with
practices regarding problematic lending
on financial and natural capita
Alignment with current banking through
supported fintechs
The negative impact of uncreditable
activities on financial capital
Difficulty of transforming large corporate
structures during the transformation of
banks into technology companies
Intellectual
Capital
Climate Action
Decent Work
The positive impact of decreasing
resource consumption on natural and
financial capital
Efficient management of climate risks
contribute to transformation economy
The positive impact of continuous operations
through superior technological competencies on
financial and relational capital
Decreasing personnel needs have a positive impact
on financial capital but a negative impact on human
capital
The positive impact of going paperless on financial
and natural capital
Natural
Capital
Produced
Capital
34
The negative impact of increasing "green"
regulations on financial and produced
capital
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
Responsible Operations
Climate Action
The negative impact of increasing
digitalization on relational capital
Corporate Profile
Climate Action
Contributed SDGs
Value Created for
Key Stakeholders
Inclusive financing and
innovative products
and services for
customers
Training and
development
programmes for
employees
Reliable and profitable
shareholding for
shareholders
35
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Sustainability Management
The "Sustainability Management System" is a regularly updated
that was developed in 2015 to frame the Bank’s approach to
sustainability and its environmental, social, and governance activities.
The Sustainability Management System is based on İşbank’s
Sustainability Policy and other supplemental policies approved by the
Board of Directors.
The İşbank Internal Control Division oversees the operations that
are performed within the Sustainability Management System and in
compliance with the Bank's Sustainability Policy. The activities are
designed to test the effectiveness of the controls defined within the
scope of the Sustainability Management System, assess compliance
with rules and standards, and ensure the accuracy of environmental
and sustainability-related data used as inputs in the Integrated
Annual Report. The annual Sustainability Management System audits
assess the Bank's sustainability commitments, targets, and progress
toward these targets and share findings and recommendations
In addition, the Bank adheres to with the international ISO 14001
Environmental Management System standards for assessing
and managing of environmental impacts, and the Internal Control
Division performs “internal audit” activities outlined in the ISO
14001-Environmental Management System.
Sustainability
Committee
Sustainability
Coordinator
Sustainability
Leader
Investor Relations and
Sustainability Division
Sustainability Working
Group
İşbank’s Board of Directors holds the highest management authority
in sustainability management. The “Sustainability Committee”,
which is overseen by the Chairperson of the Board and represents
all business units, consists of two Board of Directors and Executive
Members and is the management body responsible for the Bank’s
sustainability efforts. The Deputy Chief Executive in charge of
Investor Relations and Sustainability is now İşbank’s Sustainability
Leader. The Sustainability Leaderis in charge of for representing the
Bank in sustainability communications and guiding sustainability
initiatives.
For senior executives and all employees, except for the Executive
Board, an incentive-based remuneration system was developed
based on specific performance indicators related to sustainability in
line with the Bank’s strategic priorities.
The Sustainability Coordinator ensures that the Bank’s senior
management prioritizes sustainability and climate-related issues.
The Investor Relations and Sustainability Department isin charge of
analyzing developments and global trends in the field of sustainability,
shaping the Bank's ESG strategy and targets, developing business
plans in line with them, and ensuring that of efforts in this context are
coordinated across the Bank.
The Sustainability Working Group, which comprises representatives
from key functions of the Bank, works to ensure that sustainability and
climate-related issues are included in business decisions while also
allowing information flow between functions.
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.
Environmental and Social Impacts Policy
Supplier Code of Conduct
Occupational Health and Safety Policy
Human Rights and Human Resources Policy
Anti-Bribery and Anti-Corruption Policy
Gifts and Hospitality Policy
Gender Equality Policy
36
As we prepare for our second
century, our commitments for a more
sustainable and inclusive future
Aligning our loan portfolio
with science-based,
net-zero emissions
targets by 2050 as part
of our Net Zero Banking
commitments
Establishing sectoral
decarbonization routes
starting from carbon-
intensive sectors to reduce
our emissions from loans
We shared with the public
our 2030 targets for
emission reductions in
the carbon-intensive
sectors of power
generation, iron-steel
and cement.
by 2028
100 billion TL
financing for female
enterprises
by
2050
Net-Zero
Banking
by 2026
300 billion TL
of sustainable
credit
By 2040, exit
from financing
of coal and coal-
related activities
(excluding
NOCAH)
Making all İşbank
contact points
disabled-friendly
by 2030
Running
paperless
operations in
2030
Increasing the
number and
awareness of
products that
increase savings
consciousness
Increasing the
number of
customers using
digital banking
channels to over
20 million by
2030
İş Bankası 2023 Entegre Faaliyet Raporu
37
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Our Stakeholders
Financial
Institutions and
Rating Agencies Analysts
Trade Union
Suppliers
Initiatives
Supported
NGOs and Media
University
Students
Why is it
important for
İşbank?
Strong
partnerships with
financial institutions
provide the Bank
with advantageous
financial
opportunities.
İşbank contributes
to analysts’
accurate
assessments
through
transparent and
timely information
sharing, thus
guaranteeing that
it is a preferred
corporation.
İşbank operates
as an institution
with a high level
of employee
satisfaction
thanks to the labor
peace resulting
from the dialogue
with trade unions.
Long-term
supplier
relationships
provide the Bank
with operational
and cost
advantages.
Long-term
supplier
relationships
provide the Bank
with operational
and cost
advantages.
İşbank contacts
numerous non-
governmental
organizations to keep
abreast of current
developments,
exchange ideas with
other institutions and
organizations, obtain
information on areas
of need, and share its
corporate news with
the public in a fast and
accurate manner.
Quick response to
information requests;
Opportunities for joint
project development
With its employer
branding efforts,
İşbank aims to
be a corporation
preferred by the next
generation in the
future as it is today.
Mentoring activities;
Internship and
career opportunities
Fair selection
and evaluation
processes;
Fast and easy
communication;
Corporate
capacity building
İşbank respects
the association
rights of its
employees. The
Bank fulfills the
requirements
of the collective
bargaining
agreement
reached through
negotiations.
Regular meetings
Key
expectations
from İşbank
Transparent
reporting on
financial and
non-financial
performance
Transparent non-
financial reporting
İşbank reports
its financial and
non-financial
performance on
various platforms.
İşbank reports
its sustainability
performance
in compliance
with numerous
international
frameworks.
İşbank's
Response
Evaluation and
information
meetings,
Corporate Reports,
replying to written
queries
Communication
channels
Analyst days,
investor meetings,
investor
presentations,
teleconferences,
communications
of the Investor
Relations and
Sustainability
Division, Annual
Report, Integrated
Report, Reputation
Research
Increasing joint
projects
Ensuring labor
peace, practices
to increase
employee
satisfaction
İşbank manages
a competent
and large pool of
suppliers through
supplier selection,
evaluation, and
development
systems.
İşbank shares its
performance with
its stakeholders
by fulfilling the
requirements
of its corporate
engagements
which increase
every year.
İşbank carries out joint
projects with numerous
non-governmental
organizations
compatible with its
corporate values.
İşbank offers
internship and
mentoring
opportunities to a
large number of
university students
every year.
Daily
communication
with product and
service suppliers,
projects aimed
at increasing
sustainability
awareness among
suppliers
Conferences,
seminars,
congresses,
workshops,
replying to
written queries
Information and press
meetings, private
meetings, replying to
written queries, online
training, mentorship
activities and other joint
projects
Career days,
campus events,
sponsorship
activities
Employees
Customers
Shareholders
A highly motivated,
ethically committed,
qualified workforce with
digital competencies
provides a competitive
advantage for the Bank.
İşbank finances its
sustainable growth
strategy through its
extensive customer base.
İşbank's broad-based
shareholder structure
provides the Bank with
financial strength.
Business
Partners
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.
Subsidiaries
Public Institutions
As an integrated
organization, İşbank
creates value for its
investors through the
synergy it creates with
its subsidiaries.
İşbank ensures
its operational
sustainability by fully
complying with the laws
and regulations of all
geographies in which
it operates. The Bank
exchanges views with
public institutions and
expresses opinions on
new regulations.
A development-
supportive, fair working
environment; A
corporation that brings
the competencies
of the day to its
employees; Adoption of
new working models
İşbank has defined its
policies and procedures
to be a fair 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.
Working Life Evaluation
Survey, training
programs, performance
evaluation, internal
communication
platforms, regular
executive meetings
Easy to reach; Accurate
guidance on products and
services; User-friendliness
of digital channels
To directly and quickly get
accurate and up-to-date
developments about
İşbank and exercise their
shareholder rights
A win-win approach
with transparent and
innovative corporate
practices
Protecting and
enhancing İşbank
Group’s reputation,
Joint projects and
information exchange
Full compliance with
legislation; Exchange
of ideas on new
regulations
Through its digital
channels, İşbank is
accessible 24/7. Customer
feedback is analyzed and
integrated into decision-
making processes.
İşbank’s Investor Relations
and Sustainability
Department considers
providing timely
information to the Bank’s
shareholders to be its
primary responsibility.
İşbank establishes
long-term
relationships with its
business partners
and increases the
corporate capacity of
its business partners.
İşbank implements
projects that will
create synergy
with its subsidiaries
and includes its
subsidiaries in its audit
processes.
İşbank submits its
opinions on the
regulations related to
the sector and carries
out all its activities
with a full compliance
approach.
Joint projects,
thematic meetings,
training programs
Boards of Directors
of subsidiaries, Joint
projects, 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
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
Why is it
important for
İşbank?
Key
expectations
from İşbank
İşbank's
Response
Communication
channels
Related capital
element
38
Financial
Capital
Financial
Capital
Financial
Capital
Human
Capital
Social-Relational
Capital
Social-Relational
Capital
Human
Capital
Intellectual
Capital
Human
Capital
Financial
Capital
Intellectual
Capital
Financial
Capital
Financial
Capital
Financial
Capital
Intellectual
Capital
Financial
Capital
Intellectual
Capital
Related capital
element
Social-Relational
Capital
Social-Relational
Capital
Social-Relational
Capital
Intellectual
Capital
Social-Relational
Capital
Social-Relational
Capital
Produced
Capital
Social-Relational
Capital
Produced
Capital
Social-Relational
Capital
39
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Our Stakeholders
Materiality Analysis at İşbank
İşbank communicates effectively with stakeholders through many
channels to understand stakeholder expectations and guide its
activities.
İşbank supports and participates in numerous local and global initiatives.
Thus, the Bank aims to be a learning organization and to be one of
the players involved in the development of solutions to social and
environmental issues. For the Bank's corporate memberships, please
visit the “Corporate Memberships” list.
İşbank also actively uses social mediato give up-to-date information
and analyze stakeholder perspectives. In 2023, the İşbank and its
brands had around 2.8 million followers across LinkedIn, Youtube,
Twitter, Facebook, and Instagram.
Details of the Bank’s social media accounts
can be found in the
“Social Media Followers” list.
Our Key Stakeholders:
Customers, Employees, Shareholders and Investors
How Do We Respond to Stakeholder Expectations?
According to the 2023 stakeholder expectations survey, the most
important expectation communicated to the Bank by employees
was the dissemination of next-generation working models. İşbank's
Next-Generation Working Model aims to provide employees more
flexible and agile working conditions with a focus on employee
satisfaction and productivity. Implemented in 2022, the working
model offers several working models depending on the nature of the
work performed, as well as extra periodic flexibilities such as working
from a different city over the summer. In 2024, efforts are underway
to make the working model permanent; in this context, the Next-
Generation Working Model Panel was held with the participation of
20 employees with various titles and positions to listen to employees'
demands and expectations regarding remote and flexible working
and to generate insights. In parallel with the insights gained during the
panel and employee assessments, it is aimed to redesign the current
model in a way that supports efficiency and employee experience
, with the goal to make it permanent in 2024. In this context, the
number of regional offices known as MaxiOfis, which were introduced
in 2023 as part of the "My IS is everywhere" vision, increased to 12.
Within the scope of opportunity, Branch employees were given the
same flexibility in terms of working hours and location as Head Office
employees
For details of the activities carried out within the scope
of new working models at İşbank
Please visit the
"The Future of Business and New
Working Models"
İşbank uses a dynamic process and a multiple-stakeholder engagement
approach to identify and manage its corporate priorities.
İşbank conducts an annual materiality analysis to review current
material topics. The dynamic process of materiality analysis benefits
from the opinions of numerous stakeholders, changing regulations
and standards, corporate strategies, and significant changes on
the global agenda. The materiality analysis considers, performance
indicators associated with strategic issues, present and future risks
and opportunities related to the topics, as well as the expectations of
relevant stakeholders.
The Bank used the European Sustainability Reporting Standards (ESRS)
of the European Financial Reporting Advisory Group (EFRAG), IFRS S1
(General Requirements for Disclosure of Sustainability-related Financial
Information) published by the International Sustainability Standards
Board (ISSB), which is part of the International Financial Reporting
Standards (IFRS) organization, and Global Reporting Initiative Standards
(GRI)to determine material topics.
In 2023, İşbank reviewed its material topics using a "double materiality"
approach. İşbank uses the double materiality approach to assess the
topic's impact on business strategies, including both financial and
non-financial impacts, when setting its material topics. The financial
and reputational risk that each topic in the materiality analysis poses
to the Bank, the amount of impact the topic will have on the relevant
stakeholders, and the Bank's ability to influence the topic are all
examined simultaneously. İşbank adopts a long-term impact approach.
Therefore, even if a topic has a short-term financial and social impact of,
medium and long-term social and financial impacts are also considered
along with the level of stakeholder expectations and the Bank's ability to
influence the topic.
İşbank analyzes risks and opportunities for all topics in the impact
matrix. Financial, operational, environmental, and reputational risks of the
topics are all examined and managed simultaneously.
While creating the 2023 impact matrix, the topic's financial impacts on
İşbank were examined on the "X" axis. The data used here was came
from the questions posed to the Board of Directors, Executive Board,
and Bank executives, as well as the sustainability teams’ assessment.
The "Y" axis represents İşbank's impact level on the topic. More than
2,500 stakeholders and Bank executives were polled for their feedback
while this data was being complied. All topics in the impact matrix were
also analyzed and weighted based on the risk and opportunity potential
that they pose to the Bank. The Bank's Board of Directors, Executive
Board, and executives conducted independent risk-opportunity
assessments, which were then consolidated after consultations.
The material topics reviewed in 2023 were divided into 3 groups. The
Integrated Annual Report contains detailed information about our
performance and targets on topics identified as “highly important”. The
Report offers exemplary projects and performance indicators for the
“important” topics group. İşbank closely monitors “less important” topics,
however the report does not provide detailed performance data.
Double Materiality Steps
Step 1: Topic List
Step 2: Evaluation of topics
A list of topics with the potential to affect
İşbank and vice versa was prepared.
The process to into account, corporate
strategies, changing legislation and
standards, sectoral practices, corporate
engagements, global trends, and
stakeholder expectations.
2.1. Evaluation of stakeholder expectations:
In 2023, a stakeholder survey was conducted
with the participation of approximately
2,500 stakeholders. A review of the results
of expectation and satisfaction research
conducted for various stakeholder groups
and media led to the determination of the
expectations of key stakeholders from İşbank
regarding sustainability.
2.2. Financial impact: The significance
level of the financial impacts of the topics
mentioned in the list of topics on the Bank was
examined through extensive management
meetings, corporate strategy and engagement
requirements, benchmarking study results, and
global trends.
2.3. İşbank’s impact on the topic: All topics
were assessed and explored in terms of the
Bank's positive and negative social, economic,
and environmental impacts on the topic, as well
as the risks and opportunities the topic poses to
the Bank and its stakeholders.
Step 3:
Selection of material topics:
The assessed topics were added to
the impact matrix.
Step 4:
Validation meetings:
İşbank executives reviewed and
approved the prepared matrix.
40
41
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Sustainability Focus Areas
İşbank prioritizes sustainability under 3 focus areas aligned with its
role in society and economic life. All topics in the Bank's impact matrix
are organized under these 3 main focus areas.
Reliable Financial Actor refers to İşbank’s activities as a financial
institution with a strong brand reputation.
Responsible Operations focuses on the impacts that İşbank considers
when managing its extensive network of operations. Under this
heading, the Bank reports on the practices it has implemented to be a
responsible employer and business partner, as well as to manage the
environmental impact of its operations.
Good Corporate Citizen focus area addresses the Bank's corporate
governance practices and social responsibility activities
Reliable Financial
Actor
Responsible
Operations
Good Corporate
Citizen
Digitalisation, Innovation
and Cybersecurity
Preferred Employer
Ethical and Transparent
Governance
Responsible and
Inclusive Banking
Operational Impact
Management
Effective Risk
Management
Climate Action
Contribution to Social
Welfare
Impact Matrix
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
Priority
Importance for İşbank
1⃞■ Digital banking and innovation
2⃞■ Efficient risk management
3⃞■ Financial performance and profitability
4⃞■ Customer centricity
5⃞■ Business ethics, transparency,
corporate management and
sustainable reporting
6⃞■ Climate action
7⃞■ The Future of Business
and New Working Models
8⃞■ Cyber security,
customer data privacy
9⃞■ Employee rights, commitment
and satisfaction
Responsible banking
Financial inclusion
Equal opportunity,
diversity and gender equality
Responsible purchasing and
supply chain management
Contribution to social welfare
Human rights
Changes in Material Topics
The topics "Combating climate change", "Responsible
Human rights were included in the impact analysis.
financing and investments considering ESG criteria", and
"The Bank's environmental footprint" were combined as
"Climate action".
42
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Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report
Topics
Environmental and Social Impacts
Financial Impacts
Relevant Stakeholders Related Corporate Policy/Document
SDG Connection
How do We Manage?
Climate Action
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.
Customers,
Financial
Institutions,
Society
Climate Change Risk Policy, Sustainability Policy,
Environmental and Social Impacts Policy
Financial
Performance
and Profitability
An innovative, environmentally sensitive economy
where all segments of society are represented is among
the most important enablers of social peace.
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.
Digital Banking
and İnnovation
Increasing digitalization in the financial sector increases
the accessibility of financial products, but also brings
cyber security issues.
Banking and finance are among the sectors most affected by
increasing digitalization and resulting changes in customer
preferences. Institutions that cannot keep up with these changes
are pushed out of the competition.
Employee
Rights,
Commitment
and
Satisfaction
The consequences of inequalities in access to
education all over the world are also felt in the labor
market. Providing employees with the necessary
skills to ensure a fair and participatory economic
order is both a responsibility and an important
competitive advantage for institutions.
High employee turnover and loss of talent are among the
major operational risks affecting all sectors. A well-equipped
workforce with digital competencies provides a significant
competitive advantage for all institutions.
Equal
Opportunity,
Diversity,
and Gender
Equality
The participation ratio of women and girls in social and
economic life is one of the most important indicators of
social welfare.
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.
Shareholders,
Investors,
Employees,
Subsidiaries
Sustainability Policy, Environmental and Social
Impacts Policy, Ethical Principles and Operational
Rules, Customer Satisfaction Policy, Climate Change
Risk Policy,
Customers,
Financial
Institutions,
Society, Sectoral
Stakeholders
Personal Data Protection Policy, Privacy Policy,
Disclosure Policy, Customer Satisfaction Policy
Human Rights and Human Resources Policy,
Ethical Principles and Operational Rules,
Employees
Remuneration Policy,
Gender Equality Policy
Occupational Health and Safety Policy
Customers,
Employees
NGOs
Society
Human Rights and Human Resources Policy,
Ethical Principles, and Operational Rules
Remuneration Policy
Gender Equality Policy
Occupational Health and Safety Policy
Cyber Security
and Customer
Privacy
An important consequence of global geopolitical
tensions is the increase in cyber-attacks. Cyber-attacks
cause significant data loss as well as a decrease in trust
in systems.
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.
Customers,
Industry
Stakeholders
Personal Data Protection Policy, Privacy Policy,
Disclosure Policy
Responsible
Banking
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.
Developing products and services that are inclusive of all
segments of society and the economy is a key component of
sustainable financial performance.
Customers,
Public
Institutions
Disclosure Policy, Customer Satisfaction Policy
ISO 9001 Quality Policy
Please visit the
"Climate Action",
"Environmental Impact", and
"Social and Environmental
Risk Management in Loans"
sections for our management
approach, performance, and
goals in this area.
Please visit the
“Financial Performance and
Profitability” section for our
performance in this area.
Please visit the
“ Innovative Bank for 100
Years” section for our
performance in this area.
Please visit the
“Decent Work” section for our
performance in this area.
Please visit the
“Decent Work” section for
our management approach,
performance, and goals in this
area.
Please visit the
“Information Security ”
section for our management
approach, performance, and
goals in this area.
Please visit the
“Responsible Banking”
section for our management
approach, performance, and
goals in this area.
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Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Topics
Environmental and Social Impacts
Financial Impacts
Relevant Stakeholders Related Corporate Policy/Document
SDG Connection
How do We Manage?
Efficient Risk
Management
It is crucial for institutions to consider their
environmental and social impacts and integrate them
into their financial processes in order to solve many
global issues, especially climate action.
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.
Business
Ethics,
Transparency,
Corporate
Management
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.
Customer
Centricity
Financial
Inclusion
One of the most important ESG impacts of the
financial sector is to provide inclusive products
and services that enable disadvantaged
segments of society to participate in the
economy.
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.
Failure to comply with new regulations and reporting
requirements entails significant financial and non-financial
risks.
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.
Offering products and services that address the needs of
all segments of society contributes positively to the market
share of financial institutions.
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
Public
Institutions,
Shareholders,
and Investors
Ethical Principles and Operational Rules, Disclosure
Policy
Anti-Bribery and Anti-Corruption Policy
Gifts and Hospitality Policy
Customers
Customer Satisfaction Policy, Disclosure Policy
Customers,
Society
Sustainability Policy
Contribution to
Social Welfare
Equal opportunity in education and ecological
awareness are the building blocks of innovative
thinking and economic development.
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.
Society
Sustainability Policy, Environmental and Social
Impacts Policy
Gender Equality Policy
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.
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.
The adoption of remote working and hybrid working
models stands out as practices that increase employee
satisfaction. The financial performance of institutions with
high employee loyalty and satisfaction also increases.
Non-compliance in the supply chain can result in
significant financial and non-financial sanctions.
With its leverage, the banking and finance sector
plays an important role in ensuring that finance is
directed towards investments that respect human
rights.
Human rights violations have many negative
consequences, both moral and economic. Institutions that
consider their impacts on human rights in their products
and processes have more effective risk management.
The Future of
Business and
New Working
Models
Responsible
Purchasing
and Supply
Chain
Human Rights
46
Employees
Human Rights and Human Resources Policy, Gender
Equality Policy
Suppliers,
Business
Partners
Suppliers,
Business
Partners,
Customers,
Employees
Supplier Management Principles
Ethical Principles and Operational Rules, Human
Rights Policy
Please visit the
“Efficient Risk Management ”
section for our management
approach, performance, and
goals in this area.
Please visit the
“Transparent and Ethical
Management” section for
our management approach,
performance, and goals in
this area.
Please visit the
“Customer Centricity”
section for our
management approach,
performance, and goals in
this area.
Please visit the
“Financial Inclusion” section for
our management approach,
performance, and goals in this
area.
Please visit the
“Contribution to Social
Welfare” section for our
management approach,
performance, and goals in
this area.
Please visit the
“Decent Work” section
for our management
approach, performance,
and goals in this area.
Please visit the
“Responsible Supply Chain
Management” section for
our management approach,
performance, and goals in
this area.
Please visit the
“Transparent and Ethical
Management” section for
our management approach,
performance, and goals in
this area.
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Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Priorities by Stakeholder Groups
Material Topics and Reporting Frameworks
S hareholders
N G O
U niversity
P ublic
International
Institutions
Trade U nion
A nalysts
B usiness
Partners
S uppliers
S ubsidiaries
Financial
Institutions
C usto m ers
Employee rights,
commitment and
satisfaction
Digital banking and
innovation
Efficient risk management
Equal opportunity,
diversity, and gender
equality
Topic
Reporting Frameworks
GRI
SASB TCFD
SDG
UN WEPs UNGC
Impact on
Business
Strategy
Stakeholder
Expectations
Employee rights,
commitment and
satisfaction
Digital banking
Equal opportunity,
diversity, and gender
equality
Financial inclusion
202-1, 401-1, 401-2,
401-3, 402-1
201-3, 405-1, 405-2,
406-1
Financial inclusion
Financial performance
and profitability
Climate action
Human rights
Business ethics,
transparency, corporate
management
The future of business
and new working models
Customer centricity
Cyber security, customer
and data privacy
Responsible banking
Responsible purchasing
and supply chain
management
Contribution to social
welfare
48
Financial performance
and profitability
201-1, 201-4
Climate action
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, 306-5,
304-2, 412-3, 413-2
Business ethics,
transparency, corporate
management
205-1, 205-2, 205-3,
408-1, 409-1, 410-1,
412-2, 415-1
Contribution to social
welfare
203-1, 203-2, 413-1
Customer centricity
417-1, 417-2, 417-3
Efficient risk management
201-2
Cyber security and
customer privacy
418-1
Responsible procurement
and purchasing
204-1, 308-1, 308-2,
414-1, 414-2
Responsible products and
services
Human rights
2--22, 2-23, 2-24,
410-1, 411-1
The future of business
and new working models
Low
Medium
High
49
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report
İşBank's Sustainability Journey
İşbank's ESG Ratings
2012
The first Sustainability Report was published.
The UN Global Compact (UNGC) was signed.
The “Environmental and Social Risk Evaluation Model (ERET)” was developed
for determining environmental and social risks in loan processes.
2014
The Board of Directors approved and enacted the Sustainability, Environmental
and Social Impact, Human Rights and Human Resources, Anti-Bribery and
Anti-Corruption, Gift and Hospitality Policies, which set out İşbank's sustainability
approach.
2015
The Sustainable Management System was established.
İşbank was included in the BIST Sustainability Index.
The İşbank Head Office building received the international BREEAM In-Use
Excellent certificate.
2016
İşbank was included in the FTSE4Good Emerging Markets Indices.
2017
The Global Compact Türkiye Declaration on Sustainable Finance was signed.
Tuzla Technology and Operations Center received the LEED Gold green
building certificate.
2018
Tuzla Data Center was certified with LEED v4 Gold for Data Centers
certification.
The first Green Project Financing Loan was provided.
2019
Turkish banks issued the first 100% Green Eurobond transaction.
The first Integrated Report was published.
An Environmental Management System (ISO 14001) was formed with
international standards.
CDP Climate Change Reporting was started.
2021
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 developed.
All of the Bank's operational regions where renewable energy may be provided
for power use have begun to use renewable energy.
Environmental and Social Impact Evaluation Model “ÇESMOD" was developed.
The Gender Equality Policy came into force.
The Climate Change Risk Policy was developed.
The CDP Water Security Reporting started.
2020
İşbank included loans for financing greenfield investments of coal- and natural
gas-fired thermal power plants to be established for electricity generation into its
Exclusion List.
A Sustainability Committee operating under the Board of Directors was established.
The Sustainable Bonds Framework was developed
The goal of becoming carbon neutral was established for operational emissions
(Scope 1 and 2).
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.
2022
The first Integrated Annual Report was published.
The Bank committed to the Net-Zero Banking Alliance (NZBA).
The Bank became a member of the 30% Club.
The Diversity Policy of the Board of Directors was put into force upon the decision
of the Board.
The Bank was included in the BIST Sustainability 25 Index and Bloomberg Gender
Equality Index.
The Bank committed to 300 billion TL of sustainable financing by 2026
and 100 billion TL of financing for women operators by 2028.
"Women's Empowerment Declaration" was published, taking into account all
stakeholders in the value chain.
A commitment to phase out coal by 2040 was announced.
The first domestic TL green bond in the sector was issued.
With the 2023 reporting, the Company received the Global Leadership "A"
score in the CDP Climate Change Program and the Leadership "A-" score in
the Water Security Program.
2023
İşbank aims to secure green/sustainable funds from international markets and become an significant actor in sustainable and inclusive economic
growth utilizing rating results that evaluate its sustainability performance in all aspects.
Refinitiv
FTSE4Good Developing Markets Index
Refinitiv Information Limited (Refinitiv) is an international rating
agency that measures the environmental, social and governance
performance of organizations.
As of the end of 2023, İşbank ranked 18th among 1,119 global
banks with a score of 86 out of 100 in Refinitiv's assessment.
The "FTSE4Good Developing Markets Index", launched by global
index and data provider FTSE Russell under the ownership of the
London Stock Exchange, is one of the world's most important index
series that institutions with value responsible investing refer to as a
source.
İşbank has been included in the "FTSE4Good Developing Markets
Index" since 2016. The Bank aims to be included in the Dow Jones
Sustainability Index in the future.
Sustainalytics
Sustainalytics is an internationally recognized research and rating
agency in the field of sustainability that evaluates the performance
of organizations on their environmental, social and governance
activities. İşbank received a rating of "18.1" in 2023 and ranked at
the "low risk" level.
BIST Sustainability Index
The BIST Sustainability Index includes companies traded on Borsa
Istanbul having a high corporate sustainability performance level.
İşbank has been included in the "BIST Sustainability Index" since
2015. With its successful performance in environmental, social
and governance areas, the Bank was also included in the BIST
Sustainability 25 Index in 2023.
50
51
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Initiatives Supported in the Field of Sustainability
The UN Global Compact and the Declaration on
Sustainable Finance
The United Nations Global Compact (UNGC) is a multi-stakeholder
organization that encourages companies to develop practices that
align with their sustainability and social responsibilities to spread a
culture of sustainable, common global development culture across
the world.
İşbank is committed to following the Global Compact principles in
all its activities. İşbank is a member of the Global Compact Türkiye
Sustainable Finance Working Group. The Group's aim is to raise
sustainability awareness in the real sector, particularly in the Turkish
finance sector, and to mobilize the private sector to provide the
financial resources required to achieve the Sustainable Development
Goals.
İşbank has signed the Global Compact Türkiye Sustainable Finance
Declaration, published by the Global Compact Türkiye Sustainable
Banking and Finance Working Group. The Declaration commits,
signatory banks to including environmental and social risks in their
assessment processes for investments of USD 10 million or more.
With this support, İşbank has declared that it will be a pioneer
in promoting various lending and sustainability-based banking
products and practices for the development of this market.
United Nations Sustainable Development Goals
The Sustainable Development Goals are a call to action that
includes the United Nations member states’ goal for 2030. The
goals are divided into 17 main headings and focus on solving
social, cultural and ecological issues. İşbank supports the United
Nations Sustainable Development Goals and reports both its
direct and indirect contributions to them.
United Nations Environment Program Finance Initiative
(UNEP FI) Principles of Responsible Banking (PRB)
In 2020, İşbank signed the Principles for Responsible Banking
announced by UNEP FI in 2019, which aims to align the banking sector
with the United Nations Sustainable Development Goals and the Paris
Climate Agreement. These principles outline the role of banking in the
new economy and seek to maximize the banking sector's impact in
achieving an equitable and prosperous future. As a signatory of the
UNEP FI Principles for Responsible Banking and a member of UNEP
FI, İşbank completed its portfolio impact analysis studies in 2022
and disclosed its compliance with the principles in the Principles for
Responsible Banking Reports for 2022 and 2023.
Carbon Disclosure Project (CDP)
Science-Based Targets Initiative (SBTi)
CDP is a global organization that helps publicly traded companies
disclose to investors how they use natural resources and how
they manage their risks in this area. Since 2019, İşbank has been
transparently sharing its environmental targets and performance
with its stakeholders under the CDP Climate Change Program. In
2023, the Bank raised its CDP Climate Change Program score to "A"
Global Leadership level. İşbank began reporting under the CDP Water
Security Program in 2021 to share its actions regarding water use
and management of its impact on water resources. In 2023, its score
in this area was at the "A" Leadership level.
The Science Based Targets Initiative guides 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 2⁰C and meet the targets set in the Paris Agreement. In 2020,
İşbank agreed to reporting its Scope 1 and Scope 2 emission targets
based on Science Based objectives, addressing its direct impact on
climate change.
Net-Zero Banking Alliance (NZBA)
Bloomberg Gender Equality Index
İşbank joined the Net-Zero Banking Alliance, which was founded by
the UN to make sure that member banks align their portfolios with
net-zero emission targets in line with the Paris Climate Agreement by
2050, by pledging to support the global transition to a carbon-free
economy. Within the scope of this membership, which is critical in
mobilizing the finance sector for the climate, the Bank has committed
to support its customers' transition to a net-zero economy by
focusing its 2030 targets on carbon-intensive sectors, as well as
reporting and publishing its progress toward its emission targets on
an annual basis.
The UN Women's Empowerment Principles (WEPs)
The WEPs are guiding principles designed to strengthen women's
roles in business and society. These principles seek to ensure women's
participation and empowerment all stages of work by emphasizing the
importance companies place on equal opportunities and their gender
equality practices. İşbank demonstrates its commitment to gender
equality by joining the WEPs signatories.
The Bloomberg Gender Equality Index, one of the world's most
comprehensive studies to measure the performance of companies
committed to gender equality, is a capitalization-weighted variable
market index that tracks the performance of publicly traded
companies. İşbank joined GEI in 2022
30% Club
The 30% Club is a collaboration of chairperson and CEOs aiming to
improve gender balance at all levels of their organizations. İşbank joined
the 30% Club aiming to achieve and maintain at least 30% female
representation on boards of directors by 2022.
Global Reporting Initiative (GRI)
GRI Standards enable all organizations to measure and report on their
impact on the economy, environment and people. Since 2012, İşbank
has been reporting its sustainability performance in accordance with
GRI Standards.
Integrated Reporting Türkiye (ERTA)
ERTA efforts seek to raise national awareness on integrated reporting
and integrated thinking, build organizational capacity, and share best
practices. İşbank is a member of ERTA.
Business Council for Sustainable Development (BCSD
Türkiye)
Business Council for Sustainable Development (BCSD Türkiye)
is a business association founded in 2004 by 13 private sector
representatives that solely accepts corporate membership. BCSD
Türkiye seeks to ensure that the fundamental elements and principles
of sustainable development are better understood, adopted and
implemented in the business world. İşbank joined of BCSD Türkiye in
2023.
52
53
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Contribution to Sustainable Development Goals
SDGs to which the
Bank Contributes
İşbank's Approach
Targets to which the Bank Contributes
Material Topic
Strategic
Area
The Sustainable Development Goals are the most
comprehensive global collaboration to address the most pressing
challenges facing the world. 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 transformative power and leverage effect of the banking and
finance sector 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 9 goals that fall into its field of
activity.
İNSANA YAKIŞIR İŞ
VE EKONOMİK BÜYÜME
Contributed SDG's
İşbank's Approach
Targets to which the Bank Contributes
Material Topic
Strategic
Area
SANAYİ, YENİLİKÇİLİK
VE ALTYAPI
NİTELİKLİ
EĞİTİM
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
the education quality of Türkiye 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.
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
Employee
Rights,
Commitment,
and
Satisfaction,
Contribution to
Social Welfare
Decent
Work,
Contribution
to Social
Welfare
Equal
Opportunity
and Diversity,
Responsible
Products and
Services,
Financial
Inclusion
Decent
Work,
Responsible
Banking
EŞİTSİZLİKLERİN
AZALTILMASI
İKLİM
EYLEMİ
TOPLUMSAL
CİNSİYET EŞİTLİĞİ
ERİŞİLEBİLİR VE
TEMİZ ENERJİ
54
İşbank supports the transition to a low-
carbon economy and offers financing for
renewable energy investments to ensure
energy transformation. The Bank creates
resources for the renewable energy sector
by committing itself to utilizing renewable
resources in its operations.
7.2 Increasing investments in renewable energy
7.3 Increasing energy efficiency
Climate Action
Climate
Action,
Operational
Impact
Management
İşbank commits to numerous voluntary
initiatives and develops partnerships to
utilize its capabilities and know-how to
achieve the Sustainable Development
Goals.
HEDEFLER İÇİN
ORTAKLIKLAR
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.
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
Responsible
Products and
Services,
Climate Action,
Employee
Rights,
Commitment
and
Satisfaction
An Inclusive
and Robust
Economy,
Decent Work
9.2: Promoting inclusive and sustainable
industrialization
9.4: Supporting clean and environmentally friendly
technologies
9.5: Increasing the budget for Research &
Development activities
Responsible
Products and
Services,
Climate Action
An Inclusive
and Robust
Economy,
Next-
Generation
Banking
10.2: Promoting inclusive economic growth for all
10.3: Eliminating discrimination
10.4: Adopting policies that can prevent inequality
Responsible
Products and
Services,
Employee
Rights,
Commitment
and
Satisfaction
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
İşbank oversees its ethical principles
in both its own operations and lending
processes to build peaceful and inclusive
societies and to create effective,
accountable, and inclusive institutions at
all levels.
16.5: Significantly reducing all forms of corruption and
bribery
16.6: Developing effective, accountable, and
transparent institutions at all levels
16.7: Ensuring responsive, inclusive, participatory, and
representative decision-making at all levels
Responsible
Products and
Services,
Business
Ethics,
Transparency,
Corporate
Governance
Climate
Action,
Operational
Impact
anagement
Good
Corporate
Citizen
17.7 Promoting development, transfer, dissemination,
and diffusion of environmentally sound technologies
to developing countries on favorable terms
17.9 Enhancing international support for
implementing effective and targeted capacity building
in developing countries to support national plans to
implement all sustainable development goals
17.16 Enhancing Global Partnership for Sustainable
Development complemented by multi-stakeholder
partnerships that mobilize and share knowledge,
expertise, technologies, and financial resources to
support the achievement of sustainable development
goals
Climate
Action,
Business
Ethics,
Transparency,
Corporate
Management
Good
Corporate
Citizen
55
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Reliable
Financial Actor
58
80
90
Inclusive and Robust
Economy
Climate Action
Innovative Bank for 100 Years
Inclusive and
Robust
Economy
Social welfare is possible through a model in which economic
development is reflected in all segments of society. İşbank, the
longest-established institution in the financial sector, strives to create
an economic model that encompasses all segments of society and
creates equal opportunities for all and to communicate this model to
the public in the clearest way possible.
Risks
Volatility caused by high inflation, falling purchasing power, and potential
job losses
Increasing geopolitical tensions making long-term planning difficult
Reduced customer loyalty as a result of less customer contact due to
differentiating banking channels and growing digitalization
Losing touch with developments such as platform business models and
sharing economy, which are essential components of the new economy
Inadequate product and service development by failing to analyze
changing customer expectations well
Penalties and sanctions that may be incurred due to rapidly changing
regulations and non-compliance with laws
Uncertainties that may arise as a result of the rapid development of artificial
intelligence technology
Human and economic losses caused by a potential Istanbul earthquake
Diminished trust in 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
combat climate change
Extreme weather events and loss of biodiversity as a result of the failure of
actions to address climate change
Opportunities
İşbank’s robust financial structure, its ability to quickly make use of emerging
opportunities thanks to its dynamic and proactive business strategy
Access to new business opportunities through synergies created with
subsidiaries
Increasing the Bank's penetration through products specifically developed
for disadvantaged segments
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
cover all segments of society
Increasing customer satisfaction and compliance level by providing
customers with accurate and timely information about products and services
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
Making decision-making processes efficient and easy by expanding the use
of artificial intelligence applications
Key Performance Indicators
Total Cash Loan Growth (%)
Non-performing Loan Ratio (%)
Swap-adjusted Net Interest Margin (%)
Net Fees and Commissions Growth (%)
OPEX Growth (%)
Cost/Income Ratio (%)**
Return on Average Tangible Equity (%)
Return on Average Assets (%)
Capital Adequacy Ratio (%)
Tier 1 Ratio (%)
Leverage (%)
Number of Customers (million)
Individual Net Promoter Score
Individual Net Promoter Score Ranking (among private banks)
Commercial Net Promoter Score
Commercial Net Promoter Score Ranking (among private banks)
Customer satisfaction score (%)
Number of people reached through Farmer Meetings
Number of disabled-friendly Bankamatik ATMs
Number of disabled-friendly branches
2021
42.9
4.1
3.14
35.6
34.9
30.8
18.4
1.92
2022
53.9
3.0
6.85
111.9
113.9
25.8
46.8
5.32
2023
51.1
2.1
3.50
162.8
112.3
38.2
33.3
3.82
20.36 (16.53)*
24.36 (21.49)*
21.60 (18.41)*
15.78 (12.49)*
20.51 (17.91)*
18.04 (15.18)*
6.75
20.7
72.4
1
79.1
1
90
1,861
5,113
9.19
22.8
37
1
36
4
N/A***
7,000
5,731
7.11
24.3
50
1
46
1
N/A***
3,676
6,270
Visually Impaired 471
Orthopedic Disabled
823
Visually Impaired 511
Orthopedic Disabled
791
Visually and
Orthopedically
Disabled 1,066
Number of female entrepreneurs who participated in events to support
female entrepreneurs
Satisfaction Score of Startups Participating in our Entrepreneurship
Programs
267
-
2,328****
3,304
-
87.5
Relevant Stakeholders
Material Topics
Customers
Public institutions and
regulatory authorities
Financial Performance
and Profitability
Financial Inclusion
Sectoral stakeholders
Customer Centricity
Investors and
shareholders
Responsible Banking
Contributed SDG's
Related Capital Elements
Improving financial literacy and savings awareness
Financial
Capital
Intellectual
Capital
Social-Relational
Capital
Museum workshops
could not be held
due to the COVID-19
measures put in place.
11,910 students
participated in the
workshops held at
İşbank Museums.
The events organized
at İşbank Museums
8,683 students in
workshops
participated.
Number of feedback responses communicated to the Customer Relations
Program
656,000
693,162
746,291
*Excluding the impact of BRSA measures. **Adjusted rates included investor presentations.
***As of 2022, Retail and Commercial NTS 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.
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TL Loan Growth
Net Interest Margin (adjusted for swap cost)
Increase in Net Fees and Commissions Revenue
OPEX Growth
NPL Ratio
Net Cost of Risk
Capital Adequacy Ratio (excluding the impact of BRSA measures
Return on Average Tangible Equity
(1) August 7, 2023 revised expectation
Targets for 2023
Realization in 2023
Targets for 2024
> 40%
~5%(1)
~100%(1)
~100%(1)
< 3%
~150 bp
> 15%
~30%
56.3%
3.5%
162.8%
112.3%
2.1%
96 bp
18.4%
33.3%
~ 50%
~ 4.0%
> 100%
~ avg. Inflation
~ 2%
~150 bp
> 15%
> 35%
Financial Performance and Profitability
İşbank's sustainable profitability is driven by its strong financial
structure and proactive business strategy, which allows it to seize on
new possibilities swiftly.
Financial Performance and Profitability
İşbank increased its total asset size to TL 2,453.8 billion and retained
its status as the “largest private bank in Türkiye” in 2023 as well.
Exceeding its targets, İşbank remained the leading private bank in
terms of the size of total loans, deposits, and equities.
İşbank is the private bank that makes the most significant
contribution to the national economy with a total size of cash loans
reaching TL 1,147.4 billion by the end of 2023. Loans in TL grew by
56.3 %, while loans in foreign currencies fell by 9.7% compared to the
end of the previous year, excluding currency impact.
The Bank provided the economy with resources of TL 427.4 billion
in noncash loans of the end of 2023. At the end of the year, loans
accounted for 46.8% of the Bank's total assets, with its securities
portfolio accounting for 19.3%. Thanks to its stable growth policy and
effective risk management practices in loan allocation processes,
İşbank achieved an NPL ratio of 2.1%.
Extensive Customer and Shareholder Base
İşbank has a broad shareholder base of nearly 240 thousand
individual and corporate investors. The İşbank Members'
Supplementary Pension Fund, with a membership base of
approximately 50 thousand employees and retirees, controlled
38.2% of the capital İşbank had 24.3 million customers as of the end
of 2023.
Widespread Deposit Base
İşbank remained savers' first option thanks to its extensive service
network, customer satisfaction, and various digital channels.
In addition to the ongoing efforts since 2022 to use savings in
exchange rate-protected TL time deposit products to support Turkish
Lira deposits, the 3-Month TL Time Deposit Account Converted at
the Special Exchange Rate, which can only be opened at branches,
was introduced to customers in the second half of 2023 for foreign
currency depositors seeking a variety of returns.
İşbank remained the bank with the largest deposit base among
private banks in terms of the financial results of 2023. Total İşbank
deposits grew by 78.5% in the 2023, reaching TL 1,662.2 billion.
Diversified Funding Base
İşbank's main source of funding remained to be deposits, which
by the end of 2023 made up 67.7% of all liabilities. To broaden the
maturity structure of its liabilities and diversify its funding sources,
İşbank continued utilizing non-deposit funding sources in both
domestic and foreign markets. İşbank's non-deposit sources, which
consisted of repo transactions, funds borrowed, securities issued
in domestic and foreign markets, and subordinated debts, made up
14.4% of its total liabilities. at the end of 2023.
Strong and Robust Financial Structure
İşbank's shareholders' equity increased by 39.9% compared to
the end of the previous year and reached TL 267.8 billion as of
year-end 2023. İşbank's capital adequacy ratio stood at 21.6% as
of year-end.
The Bank achieved a net profit of TL 72.3 billion in 2023 with a
return on average equity of 33.3 % and a return on average assets
of 3.8%.
According to the weekly data released by BRSA on 29.12.2023,
İşbank's deposit market share increased to 10.63% from 10.05% in
2022. Total savings deposit market share increased from 11.97% to
12.09% in the same period. The balance of FX-protected deposit
(FXPD) products, which was TL 126,974 million at the end of 2022,
increased to TL 266,069 million as of December 29, 2023. In 2024,
the expectation is that the CBRT will support the transition from
foreign currency deposits and FX deposits to standard TL deposits
within the scope of the Monetization strategy.
Despite laws and competition, İşbank's retail loan balance increased
by 89.27% in 2023. Product breakdown growth rates compared to
the last quarter of 2022 were as follows:
36.55%
Consumer loans
195.87%
Additional Account
36.57%
Housing Loan
51.40%
Vehicle Loan
178.98%
Credit Card Balance
The share price of ISCTR, İşbank's stock traded on Borsa Istanbul,
increased by 97% overall in 2023. Within this framework, the Bank's
Group C share price remained above the performance of the BIST
100 Index in the same period.
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Reliable Financial ActorLooking Into the FutureAn Overview of İşbankHow We Create ValueResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Composition of Assets (%)
Cash Values and Banks
Securities
Loans
Subsidiaries and Affiliates
Other
Total
2023
2022
23.1
19.3
46.8
5.9
5.0
100
15.8
19.8
53.9
5.7
4.9
100
Composition of Liabilities (%)
2023
2022
Deposits
Funds Borrowed and Money Markets(1)
Other Liabilities
Shareholders' Equity
Total
67.7
14.4
7.0
10.9
100
66.1
12.3
8.0
13.6
100
¹ Includes Turkish Lira and foreign currency debt instruments issued and subordinated debts
Key Financial Items (TL Million)
2023
2022
Change (%)
Ranking Among
Private Banks
Total Assets
Loans
Deposits
2,453,783
1,408,323
1,147,371
759,289
1,662,179
931,077
Shareholders' Equity
267,797
191,376
74.2
51.1
78.5
39.9
1
1
1
1
Key Financial Ratios (%)
2023
2022
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)
87.7
46.8
69.0
2.1
75.6
38.5
10.9
21.6
33.3
¹Interest-earning assets include Turkish Lira and foreign currency required reserves.
²Averages calculated based on quarterly balances.
88.2
53.9
81.5
3.0
74.4
45.5
13.6
24.4
46.8
İşbank and its
Activities in 2023
Corporate Banking
İşbank provides customized services and financing
solutions in corporate banking.
Products and Services:
Project Financing
Risk Management Solutions (Hedging)
Digital Solutions
Cash Flow Products
In 2023, İşbank focused on sustainable profitability to meet customer
needs 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 more accessible to customers. Innovative models were
designed, and penetration was accomplished in a large customer
base, especially for regaining customers whose numbers had
previously declined. As a result of all these activities, TL commercial
deposits and commission income items improved significantly in
2023 compared to 2022. Despite global and national volatility, in the
business unit where TL/FX cash loan placements were effectively
managed, loan demands were met with a holistic profitability
approach by considering the right priorities and keeping the asset
quality in mind 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
our country's economic growth activity, and their relatively short-
term structure compared to other loans, an optimum management
approach was demonstrated regarding loan maturity structures and
durations. In non-cash loans, the Bank generally concentrated on
balance gains in TL letters of guarantee and foreign trade-related
letters.
In 2023, the focus was intensified in response to changing
client requirements, especially in the expansion of digital cash
management products. By satisfying clients' immediate cash flow
financing needs, the Bank concentrated on expanding products such
as supplier financing, DBS discounting, POS discounting, etc., all of
which are based on account receivable discounts. In these products
and services, which contribute significantly to the ecosystem, a
general depth strategy was implemented in both the supplier and
dealer base. İşbank introduced new digital cash flow products to
satisfy customers' cash flow requirements at their convenience. The
Digital Invoice Discounting product was launched in 2023 under
the name of "Kolay Finansman" through both the Bank's own digital
channels and third-party business partners. With the activation of
these infrastructures, customers were able to meet their financing
needs by discounting their invoices in line with their creditworthiness,
regardless of the the buyer's limits. In addition to financing solutions
based on invoice discounting, the first step towards sustainable
supplier financing solutions in the agricultural sector was product
development based on the current year's producer receipt
discounting.
Again in the current year, İşbank launched the Digital Letter of
Guarantee product for the first time, which got an international award.
Customers can use this product to quickly satisfy their needs for
temporary letters of guarantee under the Public Procurement Law
and letters of guarantee of some private Counterparty companies
via interactive channels. The Beneficiary Company can create the
letter of guarantee in an end-to-end digital environment and deliver it
to the Counterparty company within minutes. In addition, customers
can also use cash flow products on the platforms of the financial
technology companies they work with, rather than the Bank's. In
2023, with the integrations realized through APIs, the Bank's cash
flow products will be available on 3rd party platforms.
International Banking
İşbank collaborates with correspondent banks in processing foreign
trade transactions and payments for its customers. The Bank
effectively manages correspondent bank relations according to the
principle of reciprocity, aims to increase its share in the foreign trade
market, and seeks funding from international sources. In addition
to foreign trade transactions, issuance of letters of guarantee, wire
transfer services, and TL account transactions to be processed
in Türkiye on demand by customers of correspondent banks,
İşbank also fulfills additional service demands in accordance with
the applicable law. Ensuring uninterrupted supply processes by
facilitating it customers access to appropriate financing solutions and
products tailored to their needs, İşbank maintains its efficient and
sustainable collaborations with export insurance, credit agencies, and
other financial organizations.
Developments in 2023: As of year-end 2023, the Bank has been
working with 993 correspondents in 119 countries.
Effective management of relationships with correspondent banks,
export insurance and credit agencies, and other financial institutions
remains crucial in providing resources for energy efficiency projects
undertaken by İşbank customers, especially in light of persistently
high global inflation, interest rates, and economic downturn.
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The Bank secured a sustainability-related syndicated loan amounting
to USD 224,000,000 and EUR 388,250,000 in June 2023 and
another one amounting to USD 465,000,000 and EUR 411,000,000
in November.
In August 2023, a USD 109 million loan agreement was signed
with the European Bank for Reconstruction and Development
(EBRD) to meet the financing needs of individuals and companies
in 11 provinces affected by the earthquakes in February 2023.
In November, a total of USD 250 million was raised through a
securitization transaction based on remittance flows with the EBRD
and 3 different investors. In addition, on December 14, 2023, loan
agreements totaling USD 67 million and EUR 75 million were signed
with IFC, PROPARCO, and Green for Growth Fund (GGF) as part
of the Türkiye earthquake support package established by IFC to
contribute to the financing of individuals, farmers, micro and small
enterprises directly affected by the earthquakes in our country in
February 2023. The GGF loan will be used to finance renewable
energy, resource efficiency, and energy efficiency in Türkiye.
In 2023, 16 sustainable eurobonds were issued under the Global
Medium Term Note (GMTN) Program for a total amount of USD 402
million.
İşbank keeps a close eye on developments in the field of sustainable
finance, evaluates the new financing needs of its customers and
continues to provide resources to projects that are feasible and meet
lending guidelines as well as environmental and social standards. It
also supports the economy by increasing awareness and efficiency
in resource use through technical consultancy and training from
financial institutions.
You can find the list of funds obtained by İşbank from international
financial institutions and that were outstanding as of year-end 2023
in the "Annexes" section of the report.
Capital Markets Transactions
İşbank's capital markets subsidiaries provide brokerage services in
capital market instruments such as equity markets, precious metals,
debt instruments, 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
better fulfill the needs of its customers.
Developments in 2023: İşbank continued to issue debt instruments
of different types and maturities to provide long-term funding,
diversify the existing funding structure, eliminate the maturity
mismatch between asset-liability balance sheet items, and prevent
interest rate risk due to short maturity in 2023 as well. By the end of
2023, İşbank had issued domestic debt instruments with a nominal
value of TL 7.2 billion through sales to qualified investors and TL 2
billion through public offerings, contributing to the diversity of TL-
denominated products offered to customers.
İşbank continued to issue different types of bonds in 2023, breaking
new ground in the industry and becoming the first bank to issue
green debt instruments in Türkiye. Due to the demand of both private
and institutional investors, the amount of the two-year-old bond that
was issued through sales to qualified investors in Türkiye was realized
at TL 500 million. The issuance, which will contribute to the financing
of loans for green projects, was a pioneering step towards İşbank's
strategic goal of promoting green transformation and sustainability.
İşbank, together with its subsidiary İş Yatırım, generated 10.26% of
the trading volume on Borsa Istanbul Equity Market as of year-end
2023 and maintained its leadership in the brokerage sector with a
trade volume of TL 1,052 billion in the Borsa İstanbul Debt Securities
Market as of year-end 2023.
As of December 31, 2023, İşbank's custody portfolio size reached
TL 600 billion. Since 2015, when the custody license was obtained,
individual/collective portfolio custody services have been provided to
25 Portfolio Management Companies (PMCs) and one Investment
Trust, with variations depending on the company.
In 2023, İşbank customers seeking real returns turned to mutual
funds dominated by equity and thematic umbrella funds, while İşbank
investors seeking to hedge their FX position and seek returns on FX
deposits turned to hedge funds. İşbank's retail funds market share
was 14.48%. İşbank's gold balance market share, which stood at
13.49% at the end of 2022, was 12.89% according to end-November
data, as a result of the interest in FX Protected Deposits and the
policy of directing investors to TL deposits.
Investors' search for real returns continued as the inflationary
environment persisted in 2023 and Borsa Istanbul, which has
become an important alternative for investors, maintained its appeal.
During the year, the number of investors participating in public
offerings reached record levels due to investors' interest in new share
public offerings.
In the first 9 months of 2023, investors maintained their positions in
FX denominated investment products, and the rise in exchange rates
after the elections played a role in the approximately 50% increase in
the TL balance of these products.
The investment fund balance, which stood at TL 49.6 billion at year-
end 2022, increased by 109% to TL 103.9 billion as of 31.12.2023
due to the intense demand of customers seeking returns. This
investor interest is expected to continue in 2024 as well.
Thanks to the valuation effect in investment products as well as the
increase in investor interest, the total balance of İşbank investment
accounts grew by 60.6% at year-end 2023 compared to the
previous year.
Commercial Banking
As part of its founding mission, İşbank supports industrial
organizations, tradespeople, SMEs, and other miscellaneous
businesses. Being present at all points of commerce, İşbank's
extensive branch network provides value-added goods and services
to consumers across Turkey.
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
DijiKolay
Denizleri Koruyalım (Let's
Protect the Seas) Loan
Digital Supplier Finance
System
Project Financing
Risk Management Solutions
(Hedging)
Digital Solutions
Private Banking:
İşbank offers customized investment products and financial solutions
based on customer needs and preferences through its asset
management-oriented business model structured in cooperation
with its strong financial subsidiaries İş Portföy, İş Yatırım, Anadolu
Hayat Emeklilik, and Anadolu Sigorta.
Products and Services:
Asset Management
Family Funds
Private Banking Structuring
in Commercial Branches
Privia Black Credit Card
Privia Investment Fund
Privia Consumer Loans
Privia Pension Plan
Privia Motor Insurance
Privia Home Insurance
Financial Status Report
Privia Line
Developments in 2023: The Privia Black credit card, which was
introduced for the first time in 2022 and is intended to be issued
solely to Private Banking customers, provides privileged advantages
in luxury brands and companies in accordance with consumer
expectations and was publicized through campaigns throughout the
year. As a result of these efforts, as of year-end 2023, the number
of Privia Black credit card customers increased by 45%, and the
average monthly shopping volume per Private Banking customer
increased by 111% compared to the same period of the previous year.
The “Being a Privia Customer” application was launched on the
revamped
visual differentiation of İşCep for private banking customers, was
launched.
privia.com.tr website. İşCep Privia Mode, which includes
"Philanthropy" and "Inheritance and Tax Consultancy" services
started to be intermediated. Concierge services for Private Banking
customers were enriched and reintroduced in July 2023. Customers
began receiving the monthly Privia Culture and Arts Bulletin, which is
designed to keep them up to date on cultural and artistic events and
developments.
In 2023, the Bodrum Private Banking Branch was opened and a
private banking "corner" was established at the Kyrenia/TRNC
Branch. Within the scope of the "Private Banking Academy" program,
Investment Products, Derivatives and Structured Products Training
and Personal Branding and Influence Creation Training were
organized. Market briefings for branch employees were organized in
cooperation with IS Investment.
Within the scope of the Private Banking structuring (Co-Private)
in Commercial Specialized branches, the project started with 4
branches in 2022 and 5 more branches were added in 2023. In
2024, the expansion will continue with an additional 6 branches. At
9 Commercial Specialized Branches, the asset size of customers
offered Private Banking services increased by 133% as of 2023
year-end compared to the previous year-end. The size of customers'
mutual funds increased by 15 times as asset acquisition and product
diversity improved.
The Private Banking Portfolio Management Branch Information Panel
provided data on base amounts, target indicators, insurance, pension,
credit card usage, and the number of visits to private banking.
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In widely used products and services, designs that can are simple
to use in daily life by customers with an average level of financial
literacy are implemented. İşbank carries out its activities in the
field of payment systems with the goal of "integrating advanced
technologies into its products and services, meeting customers'
everyday needs and providing a flawless customer experience
throughout their lives".
Products and Services:
Personal and Commercial Credit Card Programs (Maximum,
Maximiles, Privia, Maximum Genç),
Personal and Commercial Bank Card Products (Debit Card)
Prepaid Card and Digital Wallet Applications Loyalty Programs
(MaxiPoints, MaxiMiles, Cashback/Instant Discount, Additional
Installments, Transaction Postponement, Post Installment
privileges)
Digital Card Service
Contactless and Mobile Payment (making and receiving payments)
Developments in 2023: While the number of credit cards at the end
of 2022 was 12.6 million with a market share of 12.64%, the number
of credit cards at the end of December 2023 reached 15 million with
a market share of 12.73%.
On the card acceptance side, the number of POS, which was 611,429
at the end of 2022, reached 660,375 in 2023, increasing from 7.60%
to 8.12% market share.
İşbank aims to be the "Bank of the Future" by providing innovative
goods and services through designing new technologies with a
human focus to make life easier for its customers. In this sense,
the Digital Card experience launched by İşbank in 2023 with the
promise of "Your mobile phone is also your credit card" was also a
first in the sector. Thanks to this new experience, İşbank customers
may now shop and withdraw money from ATMs using their cell
phones, eliminating the need to carry real cards. By enabling the
card to be pocketed at the time of card application, now offers
contactless payment by mobile phone or TR QR Code technology,
bringing the physical card experience in line with the digital payment
experience. The contactless payment method, which was previously
exclusively available for cash transactions in the sector, may now
be used to pay for shopping in installments or with points. With our
vision of becoming the bank of the future that creates sustainable
value, customers using the digital card experience reduced their
use of plastic, paper, and couriers, saving 11.25 tons of Carbon
(Co2) emissions. This value means that approximately 75,000 KM
of vehicle travel was saved, or 375 thousand plastic bags were not
consumed.
Digitizing the card payment experience from end to end, İşbank
started to offer the "Link Collection" service through İşCep. This
service eliminates the need for merchants to use physical POS
equipment for payment collection. The İşCep Link Collection service
enables small and medium-sized business to accept payments by
delivering a link to cardholders via the İşCep app, eliminating the
need for a separate POS device for physical stores or e-commerce
transactions. This simple and less low-cost solution allows the
66
merchant to accept payment without the need for a POS or a website,
and the buyer to make payment without having to carry a card or
enter card information on a website.
Aiming to increase the coverage of payment systems services
through digital collaborations, İşbank collaborated with MOKA,
a subsidiary of the payment institution, to offer the prepaid card
infrastructure of S-Wallet, a mobile wallet application launched
exclusively for Samsung users in Turkey. Thanks to the structure
established by integrating İşbank prepaid card APIs into MOKA,
Samsung digital wallet users can make contactless payments via
their smartwatches and smartphones; they can load as much money
as they wish into their mobile wallets and spend easily and securely,
whether online shopping or in stores, domestically or abroad.
With MOKA Super Physical POS, another innovative product
launched with MOKA, a subsidiary of the payment institution MOKA,
for the first time in the sector, installments can be made to different
bank cards through a bank POS.
Adopting the principle of extending its value chains and products
and services beyond its own channels, İşbank added new ones to
its business partnerships with non-bank players in the sector such
as payment institutions and e-money institutions. Offering card
acceptance services for online shopping through virtual POS services
to payment institutions, the Bank launched a service integrating
physical POS services into payment institutions through APIs.
With the goal of integrating payment systems into its clients'
everyday life, İşbank is constantly improving its loyalty programs
and adding new features that will make a difference in the sector.
Offering credit cards the advantage of instant discounts on certain
expenditures, the Bank has extended this feature to debit cards. In
order to facilitate the collective tracking of MaxiPoints, MaxiMiles and
Cashback privileges for each customer, a new service area called
"My Earnings" was added to the İşCep application.
With digitalization, it is becoming more difficult to keep track of
subscriptions to digital platforms, whose usage is continually
expanding in individual consumption.. İşbank launched the Visa
Token Service application for digital platform subscription payments
and added a separate menu to İşCep to enable customers to view
their subscriptions in one place.
An important experience of daily life is the use of public
transportation. Offering contactless access to public transportation
with its cards, İşbank has expanded this service to 25 cities and is
now working on adding Istanbul to the network.
In order to facilitate its customers' access to card payment services
and increase financial inclusion, İşbank proactively started to offer
ready-made credit card offers via İşCep for customers who do not
own a credit card.
Within the scope of agricultural banking activities, İşbank made it
easier for its agricultural customers to access İmece Card privileges
by opening the application for İmece Card product, which plays an
important role in financing agriculture, to İşCep application.
Cross-Border Banking
İşbank Group carries out its cross-border banking operations
through its branches, subsidiary banks, and agencies abroad and
operates in 11 different countries. 9 of a total of 34 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 15 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 2023: İşbank offers its customers abroad basic
banking services such as loans, deposit accounts, domestic and
international money transfers, foreign trade intermediation, letters of
credit, and letters of guarantee. The delivery of products and services
is dynamically revised in line with changing needs. Services are
provided to foreign branch customers through digital channels via
internet branch and mobile banking applications.
In 2023, a mobile banking product was launched for customers in the
UK, Kosovo, and Iraq considering the country-specific practices. In
Iraq, the Bank intermediates a significant portion of the trade between
Türkiye and Iraq through its Baghdad and Erbil branches and also
provides resources through loans to projects that create added
value for the region. Within this scope, the Bank started to mediate
auction transactions that contribute to the foreign trade volume
between Türkiye and Iraq. Letter of guarantee transactions addressed
to counterpart institutions and organizations in the country also
maintained their importance.
In 2023, İşbank concentrated on expanding its customer base and
collecting deposits in Kosovo.. The positive relations established with
the Gulf Region countries through the Bahrain Branch contributed to
İşbank's efforts to diversify its funding sources. The level of relations
with London-based companies was raised, and significant increases
were achieved in contracted merchant transaction volumes. With
the launch of the mobile banking product, the number and volume of
transactions conducted through non-branch channels increased.
As of year-end 2023, the size of the total assets of İşbank's
organizations based in foreign countries was USD 6.8 billion. The
Bank's foreign subsidiaries and foreign branches, make up 42.4%
and 57.6% of this total, respectively.
Digital Banking
With the vision of being the "Bank of the Future",İşbank wants to
be more than just a bank that takes care of its customers' financial
requirements; it wants to support them with innovative products and
services that improve or simplify their everyday life.
Developments in 2023: Nays entered the application markets
on June 21, 2022 and reached 3 million users by 2023, with 62%
of Nays users being individuals who had contacted İşbank for the
first time. The number of individual users carrying out their financial
transactions using Nays was 1.1 million, while the shopping volume
created with Nays-branded digital prepaid cards amounted to TL
1.143 billion.
Within the scope of Open Banking, approximately 155 thousand
customers added their other bank accounts to İşbank channels.
İşbank channels are the most preferred primary channel in the
open banking ecosystem for commercial customers. The number
of payments initiated using other bank accounts through İşbank
channels reached 64 thousand.
Visited 18 million times by 5 million people every day, İşCep enables
both personal and commercial users to easily manage their needs
with its rich transaction set consisting of more than 700 functions.
In 2023, the time spent per session on İşCep increased by 25%
compared to the previous year. The share of non-branch channels
in transactions was 97.1% and digital channels in sales was
74.8%, respectively.
In September 2023, the remote bank customer service via İşCep was
launched for commercial companies. With the "I Want to Become a
Customer" feature on İşCep, Limited Liability Companies with a single
partner can become customers without submitting any paperwork or
wet-signed documents to the bank.
In 2023, within the scope of our strategy to make İşCep a super app,
we aimed to enable customers to access value-added products and
services that they require for both their financial needs and various
phases of life through İşCep. Within this scope, My Home, My Family,
and My Travel life areas were offered to customers under the "My Life
with İşCep" umbrella.
Innovative Banking
The differentiation of communication methods in a digitalizing world,
as well as the widespread use of applications that can be accessed
via smart phones and provide messaging and call opportunities,
have necessitated changes in the way businesses do business
and in people's lives. In this context, with the "Dialogue" application,
which our branch employees can access through the NAR platform,
a solution that enables direct messaging, voice and video calls with
our Bank's individual and commercial customers has been launched.
The "Dialogue" application is designed to keep in touch with our
customers who wish to conduct financial transactions at a distance
in an efficient and risk-free manner, and the messaging, voice and
video calls made through the application are recorded. In addition, the
application allows to send files, which our employees may quickly add
to the Customer Documents screen by our employees.
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Reliable Financial ActorLooking Into the FutureAn Overview of İşbankHow We Create ValueResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Treasury Management
İşbank's main objective is to optimize the risk-return balance by
focusing on effective capital utilization in credit and investment
portfolios, dynamic management of foreign exchange and liquidity
positions as well as cost control, and to further strengthen its balance
sheet structure through a sustainable profitable growth strategy.
Developments in 2023: In 2023, central banks of developed
countries, struggling with global inflationary pressures, gradually
raised policy rates while closely monitoring geopolitical risks. On the
domestic side, in the first half of the year, the CBRT continued to take
steps to enhance the effectiveness of the liraization process, with
the main agenda items being the increase in establishment liabilities
for securities and the tightening of pricing and growth constraints
on commercial and retail loans. The CBRT's simplification decisions
aimed at improving the functionality of market mechanisms and
strengthening macro-financial stability began to be implemented in
the second half of the year, with the main issues being arrangements
prioritizing Turkish lira deposits and the transition from securities
establishment practice to the of charging commission on required
reserves.
In addition to monetary policy decisions, loan, collateral, and liquidity
policy steps focused on strengthening the effectiveness of the
transmission mechanism continued to have an impact on banks'
decisions to manage their total interest-earning assets, particularly
their securities portfolios. For the banking sector, managing balance
sheets shaped by macroprudential policies by taking into account
liquidity, interest rate, and exchange rate risks has been a priority,
and adapting to rapidly changing legislative regulations as well as
effectively managing customer preferences gained importance.
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". Business processes
and customer journey experiences are continuously improved
through design-oriented thinking methodology. Critical customer
journeys are being reviewed and redesigned to provide a better
experience in order to understand and fulfill customers' changing
needs and expectations in the new period.
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 2023: As per the liraization policy driven by
market developments, the Bank, in cooperation with the Capital
Markets Division, continued to offer a variety of special FX-protected
deposit products to meet customer return expectations throughout
the year. The TL weight in total deposits was increased from 35%
at the beginning of the year to 61% as of November 22, 2023. In
addition to deposits, alternative investment products such as forward
exchange funds, personalized hedge funds, and family funds that
provide intergenerational wealth transfer in a return-oriented manner
were offered to customers extensively. Within this framework, as of
November 22, 2023, total assets under management increased by
83% compared to the end of 2022.
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İşbank's
Subsidiaries
İşbank, an integrated group company, has acquired various
companies to support Türkiye's industrial and economic
development.
At the meeting of the Bank's Board of Directors held on August
25, 2023, it was decided, subject to the approval of the General
Assembly, that the Bank will be partially demerged in a simplified
manner through the subsidiary model to manage the subsidiary
portfolio more effectively and efficiently, and that the capital shares
in 15 affiliates and 1 subsidiary owned by the Bank will therefore be
transferred to a new umbrella company to be established with 100%
shareholding of the Bank. With the new structure, it is planned to
adopt a more focused and strategic management approach, as well
as to increase synergy among the subsidiaries and to demonstrate
competitive performance that increases value and maximizes profit
in the subsidiary portfolio while increasing efficiency.. Work on the
establishment of the umbrella company is ongoing, including the
legal authorization processes before domestic and foreign regulatory
authorities.
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 2023, the Bank directly and
indirectly holds shares in 154 companies, 119 of
which are controlled by the Bank. The Bank directly
holds shares in 30 companies.
These companies accounted for TL 152 billion of the Bank's total
assets as of the end of December. 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 67% 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 2023, the portfolio accounts for 6% 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 2023 performance of our subsidiaries
Please visit "İşbank's Subsidiaries" section
Sectoral Distribution
Subsidiary Composition
Glass
40.8%
Bank
21.6%
Financial Inst.
16.1%
Insurance
9.9%
Other
11.6%
Listed on stock
exchange
68.2%
Unlisted on
Stock Exchange
31.8%
Non-
Financial
52.4%
Financial
47.6%
Significant developments in 2023 regarding Subsidiaries:
İş Enerji Yatırımları A.Ş., which operates to create an integrated
renewable energy portfolio, established İş Yenilenebilir Enerji Proje
Yönetimi Danışmanlık A.Ş., Is Energy Investments BV based in
the Netherlands and Is Energy Romania S.R.L. based in Romania.
Through İş Yenilenebilir Enerji Proje Yön. Dan A.Ş., joint control of
38 energy companies operating solar power plants became a 50%
partner in Soli SPP with a total installed capacity of 77 MW.
İş Enerji Yatırımları A.Ş. acquired 50% of the shares of Polat Enerji
Yatırımları A.Ş. owned by Maxis Clean Energy Venture Capital
Investment Fund and became a partner in 754 MW portfolio of
SPPs and WPPs.
Maksmarket Danışmanlık Elektronik Hizmetler Tic. A.Ş., which was
established in 2022 to be a reliable marketplace for commodity
trade and to pioneer the digitalization of these sectors, launched its
digital marketplace platform Proemtia in April 2023, starting with
iron and steel products.
İmecemobil Tarım Platformu Elektronik Hizmetler Tic. A.Ş.
“İmeceMobil”, a company that operates to provide digital
agricultural technology services to small and medium-sized
farmers, was established with the aim of appropriately using
technologies in the field of digital agriculture and sharing them with
the public. İmeceMobil has started its activities with the vision of
becoming an inclusive, global agricultural technology company
that creates sustainable value together with all stakeholders in a
multi-dimensional and long-term manner by bringing together
agriculture, finance, and technology.
Imecemobil Tarım Platformu Elektronik Hizmetler Tic. A.Ş., our
indirect subsidiary, acquired an 8.33% stake in İTTM Tarım Teknoloji
Girişimleri A.Ş., which will operate as a Technology Center and
implement the agricultural entrepreneurship ecosystem. The
goal is to support the digital transformation of agriculture and
strengthen the participation and integration of the information
and communication sector in agriculture to make it sustainable,
competitive, and efficient.
Negotiations were initiated for the merger of Moka Ödeme ve
Elektronik Para Kuruluşu A.Ş., an affiliate, with Birleşik Ödeme
Hizmetleri ve Elektronik Para A.Ş., an Oyak Group company, in order
to utilize synergy and growth opportunities in Türkiye and abroad.
In December 2023, the Competition Authority application for the
merger was filed.
Through its affiliate Ödesis Finansal Teknoloji Girişimleri A.Ş., the
Bank participated in IS United Payment Systems Limited, which will
operate as a payment and electronic money institution in the UK,
with a 50% stake.
Topkapı Danışmanlık Elektronik Hizmetler ve Pazarlama Ticaret A.Ş.
(Pazarama), which operates in e-commerce, has participated in
Hamurlabs Elektronik Hizmetler Yazılım ve Ticaret A.Ş., which offers
warehouse and product management and multi-channel sales
integrations on a single platform, with a 20% stake.
AG
Trakya Yatırım
Holding
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Reliable Financial ActorLooking Into the FutureAn Overview of İşbankHow We Create ValueResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Customer Centricity
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
needed.
Customer Satisfaction
İşbank's customer experience vision involves simplifying interactions
at all contact points by recognizing customers' changing needs and
expectations of customers, guiding them by providing time-saving
and fast solutions, and assisting them when stuck.
İşbank regularly monitors customer satisfaction and NPS (Net
Promoter Score) at its branches and digital channels, responding
rapidly to feedback.
The Net Promoter Score Measurement, which is conducted through
independent research companies, monitors channel satisfaction
and critical product satisfaction by comparison to the competition.
Channel, product, and segment managers are given the SMART
target of ranking first in NPS compared to banks of similar size to
İşbank.
With an Individual NPS value of 50 in 2023, İşbank ranks first
compared to banks of similar size.
Male İşbank customers have an NPS score of 49 and female İşbank
customers have an NPS score of 51.
Continuous evaluations 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 an error; this feedback is used is used
to develop and present new products/services.
In digital channels, customers’ behavioral data were analyzed, and
more than 185 million interactions were created in 2023. While these
interactions provided clients with appropriate advice and guidance
in times of need, solutions were developed to ensure the smooth
completion of transactions in challenging situations. 1.5 million
product applications were completed, and customers were provided
with guidance to ensure that more than 4 million transactions could
be seamlessly performed via digital channels.
In 2023, two different customer satisfaction surveys were
conducted for Private Banking customers. The final net
recommendation score was "Excellent" with 70.8. Score
improvement compared to last year was +2%.
User satisfaction score with İşCep Privia Mode, which
includes the visual differentiation of İşCep for private banking
customers, was 88%.
Brand Research
The Advertising and Brand Health research study, which was made
to measure the perception of İşbank and Maximum brands and to
see the impacts of advertising activities on İşbank customers and
other bank customers regarding İşbank's core banking products
and payment systems products, was conducted with Future Bright
Group. With this research, the recall, interest creation, and influence
performance of communication activities and brand image scores
of İşbank and Maximum brands compared to the competition were
regularly monitored. The motivators that create brand preference
in the banking category were revealed, and input was provided for
marketing and communication strategies.
Next-Generation Living Space: İş Mekan
Within the strategy of designing the bank of the future and customer
experience, the first İş Mekan, designed to create a physical extension
of our digital contact with our customers, was launched on January
17, 2023 at the Nişantaşı Branch building. With this physical contact
point, we aim to reach our customers, who we contact digitally, in
the physical world as well and offer multiple value propositions with
a collective experience by meeting their needs more holistically
together with İşbank Group companies, without limiting them to
banking processes. The aim is to continuously improve the customer
experience while also strenghtening customer belonging and loyalty
through contact points that change based on customer profiles and
market variables in a variety of venues.
Serving an average of 20,000 visitors per month, Nişantaşı İş Mekan
includes T. İş Bankası Kültür Yayınları with its rich variety of books, the
first physical sales point of Pazarama, an e-commerce brand with
trendy and new technological products, and Coffee Department,
the next-generation coffee shop known in the Nişantaşı region,
as well as meeting rooms and event spaces managed by İŞMER.
Specific to İş Mekan, stakeholders also offer various discounts and
advantages to İşbank customers. Together with these stakeholders,
10 of our subsidiaries are directly or indirectly involved in İş Mekan as
stakeholders.
The actions taken by the Head Office departments 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, as well as to the Banks Association of Türkiye (TBB).
The data submitted by banks is then consolidated by TBB (Banks
Association of Türkiye) and communicated to the member banks
quarterly. The cumulative number of complaints received by İşbank
for 2023 is 370,458, and the Bank ranks 5th among member banks
of TBB (Banks Association of Türkiye).
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 2023, the Customer Relations Program (MIP) received 831,972
applications.
The İşbank Call Center, which received 22,972,105 calls in
2023, has held the EN ISO 15838 "Call Communication Centers
Standard" Certificate since 2011.
In 2023, the number of complaints received by the Institution
regarding breach of customer data privacy and data loss was 487.
The Nişantaşı Branch continues to serve on the upper floor of İş
Mekan. Branch working hours continue as they have been: İş Mekan
is open to all visitors between 08:00 - 20:00 on weekdays and
Saturdays, 6 days a week, and between 12:00 - 19:00 on Sundays.
With the newly implemented counter restriction of cash transactions
at branches, customers may now make deposits and withdrawals of
up to TL 50 thousand from ATMs in the digital banking area, allowing
them to complete their transactions without visiting a branch.
Customer Feedback
İşbank collects customer feedback through channels such as its
corporate website (https://www.isbank.com.tr/en), 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.
Complaints, suggestions, wishes and requests, feedback received by
İşbank through various channels, project-based customer surveys,
and data obtained from customer field surveys are used as input in
product development and improvement efforts through agile working
and design-oriented methodology, aiming to provide the ideal
customer experience.
Changes to Products and Services as a Result of Customer
Feedback:
A customer survey was conducted to identify the daily needs and
problems of end-users in the Digital Card experience project. It is
instantly available upon application and allows all transactions that
can be made with a physical card to be made with a mobile phone.
In line with market conditions and feedback from customers
working with other banks, a liquid investment fund product called
"ONS - İş Asset Twelfth Hedge (FX) Fund - US" was launched,
which mainly includes reverse repo. The "CKS - İş Asset First
Participation Hedge (FX) Fund - USD" and "ILH- İş Asset
First Hedge (TL) Fund " investment funds were also offered to
customers.
Based on feedback from surveys conducted after ATM
transactions, the cash withdrawal limit for salary contractors and
pensioners was increased.
Following input from İşCep surveys and Funnel analysis, several
transactions were made easier to find and complete, resulting in
reduced effort. In 2023, the Bank focused particularly on feedback
received on investment transactions and planned critical actions.
In line with the feedback received from users, the Invite and Earn
flow of the Nays application was changed and the experience of
those invited to earn rewards was improved.
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Reliable Financial ActorLooking Into the FutureAn Overview of İşbankHow We Create ValueResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Informing Customers
İşbank uses many different channels to provide its customers with
accurate and up-to-date information in an open and transparent
manner. In line with the responsible banking and customer centricity
approach, the Bank's products and services are explained in a way
to include all the details the customer needs about the product
and service, especially legal requirements. The Bank continues to
make investments to develop all its employees skills, ensuring that
such information is conveyed directly or indirectly to customers in a
complete and accurate manner.
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 so that they can be
prepared 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 redirected to the related
departments.
Communication campaigns such as mailings, advertisements,
and announcements 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 informed 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 receive 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,
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.
Activities that support the customer experience include adding
various products and services to digital channels in bancassurance,
supporting product sales through campaigns, and informing
customers via SMS, e-mail and push notifications. In 2023, drawer
offers such as giving automatic renewal orders for Anadolu Sigorta
policies and increasing home insurance coverage were offered to
customers on İşCep, and if they approved the offer, it was ensured
that these transactions could be easily carried out with a single
click.
In 2023, the Bank did not incur any penalty due to non-compliance
with regulations on customer information requirements.
72
Responsible
Banking
Within its responsible product and service offering approach, İşbank
develops products and services that encourage savings awareness,
cover all segments of society, and aim to increase financial literacy.
İşbank offers 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.
All products and services of İşbank are evaluated within the scope
of risk exposure due to products, services or activities defined in
the Bank's legislation. All products, services, and activities to be
developed can be evaluated in terms of sustainability.
İşbank participates in fairs and conferences on renewable energy
and energy efficiency and contributes to the dissemination of its
sustainability portfolio. In addition, awareness-raising activities are
carried out with technical information received from stakeholders the
Company collaborates on sustainability-themed products.
Informative and awareness-raising communication activities are
carried out for businesses that are likely be affected by climate
change and CBAM (Carbon Border Adjustment Mechanism).
İş Asset Sustainability Equity (TL) Fund (Equity
Intensive Fund)
At least 80% of the fund’s total value is constantly invested in
partnership shares included in the BIST Sustainability Index and
in exchange-traded fund units established to track the BIST
Sustainability Index.
Responsible Marketing
İşbank's key responsibility is to provide its customers with
accurate, transparent, and clear information about its products
and services. Information that facilitates customers' decision-
making processes and meets their requirements is provided
through clear and understandable products and services that
always focus on the customer. 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”.
İş Asset TEV Education Support Hedge Fund
TEV Education Support Hedge Fund aims to provide
scholarships to students over the years by transferring half of
the fund management fee generated from the TEV Education
Support Hedge Fund to the Turkish Education Foundation, which
has been contributing to the future of young people for 56 years
with its mission of equal opportunity in education.
Products and Services for
Increasing Awareness on Savings
Aiming to promote savings awareness in all segments of society,
İşbank maintained its position, based on the financial statements
recently disclosed to the public, as the bank with the largest deposit
base among private banks in terms of 2023 third quarter financial
results. Total İşbank deposits grew by 56.8% in the first nine months
of 2023, reaching TL 1,460 billion in total.
In 2023, our Bank's total TL deposits increased by TL 480.7 billion
(up 125%) and total FX deposits by TL 235.5 billion (up 43%).
In this period, TL savings deposits increased by TL 267 billion, FX
savings deposits increased by TL 180.9 billion and TL share in
savings deposits increased from 36.5% to 46.5%. The share of Total
Savings Deposits in Total Deposits remained at 64%.
ό
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 of customers with credit cards and
investment accounts to round up their credit card debt to a higher
amount of their choice, which is then deposited into an investment
savings account. As of year-end 2023, there are over 150 thousand
customers with open “Üstü Kalsın” orders.
Following the general change made to the “Üstü Kalsın” service
on March 9, 2023, the amounts rounded up from the credit card
end-of-period debt within the scope of the instruction were used to
purchase TTA - İş Portföy Gold Fund shares instead of IBK - İş Portföy
Maximum Card Short-Term Debt Instruments Fund shares.
ό İş Asset Moneybox Account Mixed Special
Fund
İş Asset Moneybox Account Mixed Special Fund established in 2001
as the first example in Türkiye of the concept of investing on behalf of
children, is a "savings" fund that allows minors to invest in their future
today.
İş Asset Moneybox Account Mixed Special Fund, which is not traded
on the TEFAS Platform and sold only through İşbank distribution
channels, had nearly 130 thousand investors and a total investment
size of TL 1 billion 140 million as of year-end 2023.
ό
Gold Banking
İşbank offers customers 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. The system is also integrated with
the Jewelry Gold Valuation System. Gold or jewelry items brought by
customers are deposited into the Demand Gold Account in grams
of gold. In 2023, over 2,000 kg of scrap gold was dematerialized in
demand deposit gold accounts through these channels.
ό
Robofon
The Robofon Consultancy service, managed by İş Portföy, provides
fund consultancy services to customers 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. In 2023, over
83 thousand customers received fund advice, and the number of
customers benefiting from the service reached over 280 thousand.
ό
Daily Earning Account
The Daily Earning Account, which can be opened via İşCep or the
Internet Branch, offers customers the opportunity to utilize their
savings on a daily basis compared to long-term accounts. The total
balance of Daily Earning Accounts was nearly TL 15.5 billion at the
end of 2023.
ό
Exchange Rate-Protected Deposit Account
At the end of December 2021, as per 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
FATSİ, which can only be opened at branches, can also be opened
via İşCep and the Internet Branch. The total balance of FX-Protected
Time Deposit Accounts was approximately TL 266 billion at the end
of 2023. Excluding bank deposits, savings invested in FX-Protected
TL Time Deposit products accounted for 17.2% of the Bank’s total
deposits in the first twelve months.
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Reliable Financial ActorLooking Into the FutureAn Overview of İşbankHow We Create ValueResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report ό Human Rights and Social Impact Evaluations in
Investment and Loan Activities
Similar E&S questions are also asked to customers when the Bank
disburses foreign funds collected from overseas.
İşbank's investment and loan activities comprise human rights and
social impacts in addition to 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 issues 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 financed by the ÇESMOD Model, which İşbank uses to
determine investments' E&S risk scores and has updated in 2022,
are evaluated by answering the question sets prepared specifically
for the subject investment sector following the initial evaluations
conducted with specific sets of questions based on the type of
investment.
Specific investment types and sectors are evaluated and scored by
means of question sets created within the framework company's
activities framework on issues whose scope is determined
by legislation, laws, and regulations, such as EIA decisions,
environmental permits, environmental and/or social impact
assessment, occupational health and safety, community health and
safety, involuntary resettlement and stakeholder participation.
Based on the answers given, the risk category of the project is
determined, e.g. high (A), medium high (B+), medium low (B-) and low
(C). 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 a
human rights impact evaluation, in accordance with the requirements
of international standards.
All projects assessed under the Environmental and Social Risk
Evaluation Model (ÇESMOD) are subject to the following criteria;
Conducting a social impact assessment for the project, including
gender equality, sexual harassment, discrimination, child labor, and
human rights risk assessment,
Whether there is litigation (ongoing or closed) or strong community
opposition against the project,
Whether the loan to be provided will reduce the company's
environmental and social impacts
In projects that undergo ÇESMOD Evaluation, the Bank requests that
complaint mechanisms be established and monitored for violations of
local people's rights.
ό Financing Infrastructure Investments
Within the scope of large-scale infrastructure investments financed
by our Bank, social impact assessment studies are carried out, taking
into account the social benefit of the society, and necessary actions
are taken to manage potential negative impacts of the investments.
In addition to limiting negative impacts by allocating corporate social
responsibility budgets to cover the construction and operation
periods of large infrastructure investments financed by our Bank,
positive impacts are increased by developing processes for the
benefit of stakeholders in the impact area of the projects.
Within the scope of highway projects, social responsibility projects
such as road, school and water line renovations on highway routes,
as well as supporting education with certain budgets on an annual
basis, have been developed. In 2023, a total of approximately USD
165 million was allocated for electricity distribution, port and highway
projects.
Infrastructure – Public Private Partnership / Highway Projects
Investment Size (USD)
27.3 Billion USD
Total Commitment (USD)
37.5 Million USD
Total Risk (USD)
1.4 Billion USD
Infrastructure Capacity
Reached Total
1,889 km
Infrastructure – Public Private Partnership / City Hospital Projects
Investment Size (USD)
3.5 Billion USD
Total Commitment (USD)
16.1 Million USD
Total Risk (USD)
0.6 Billion USD
Infrastructure Capacity
Reached Total
9,978 People
Financial Inclusion
Playing a pioneering role in the use of technology and embracing the
mission of increasing financial inclusion in the banking sector, İşbank
aims to increase and ensure fair distribution of social welfare by
developing products and services for all segments of society.
All İşbank products and services are introduced to customers in
one-on-one customer meetings in a way that prioritizes customer
needs and expectations, within the framework of openness and
transparency principles.
ό
DijiKolay
DijiKolay was launched in 2021 to address the needs of SME and
business segment customers regarding digitalization with a holistic
approach. There are four different categories under the DijiKolay
umbrella: e-transformation solutions, e-commerce solutions,
sustainability solutions and managerial solutions. In this context,
17 solutions were offered to customers in 2023. In 2023, 9,061
customers applied for DijiKolay solutions.
ό
SME Banking
ό
Collaboration with KOSGEB
As of year-end 2023, the total amount of financing provided to SMEs
in cash and non-cash loans reached TL 12.7 million.
ό
Support to the Agriculture Sector and Farmers
İşbank carries out all its activities in agricultural banking with a
responsible banking approach. The Bank aims to bring agriculture
and technology together with an innovative perspective and to meet
the financing needs arising at this point through the most appropriate
channels.
The outputs of structured studies such as the Agricultural Banking
Advisory Board, İmece Workshops, and the Net Promoter Score
Survey guide the strategies. Within the scope of the "Sustainable
Transformation of the Customer" target, efforts are being made on
topics such as smart agricultural loan campaign, renewable energy,
and irrigation loans.
The total amount of cash loans extended to the agricultural sector
exceeded TL 30 billion.
Financial Supports Provided:
ੵ Pressurized Irrigation Systems Loan Campaign
ੵ Farmer Women Loan Campaign
ੵ EBRD TurSEFF Renewable Energy and Energy Efficiency Loan
Campaign
ੵ Tractor Loan Campaign
ੵ Loan by ELÜS Campaign
ੵ Good and Organic Agriculture Campaign
ੵ Agricultural Loan Campaign
İşbank's growth in SME and Enterprise Banking is achieved through
systematic, measurable, and dynamic deepening among existing
customers as well as new customer acquisition and customer
activation. The volume and product usage of customers of all sizes
working with İşbank are monitored in an up-to-date and dynamic
manner with the support of artificial intelligence and rule-based
modeling, and efforts are made to maintain and increase customer
depth.
ό
Green Transformation
Campaigns with favorable terms and price conditions are being
organized to support SMEs' green investments. Among our green
financing products which are offered with advantageous terms and
rates to businesses with environmentally friendly investments, Solar
Loan by İşbank provides financing for SPP investments, Energy
Efficiency Loan provides financing for investments ensuring energy
efficiency by reducing energy costs, and Let's Protect the Seas Loan
provides financing for the construction or maintenance of wastewater
treatment plants to prevent and reduce water pollution and protect
water resources. Furthermore, the Green Enterprise Loan, which aims
to assist companies that have received sustainability certifications by
making investments to reduce their environmental impact at every
stage of the process, from raw materials to the final product offered
to the consumer, is one of the green commercial loan products with
favorable terms and rates. A total of TL 127,000,000 in loans was
provided in 2023 as financing support for the operating expenses of
companies holding sustainability certificates. In December 2023, the
Green Tourism Enterprises Support Loan Campaign was organized.
With the related loan, a wide range of financing opportunities are
offered, from financing the renovation, maintenance, and repair costs
of tourism enterprises to energy efficiency, water management
investments, and meeting cash requirements for operating expenses.
In 2023, a total of TL 214 million of financing was provided.
İşbank aims to reach more than 50 Agriculture
Specialised Branches in the 100th anniversary
year.
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ੵ Within the scope of sustainability criteria, workshops are
organized to present common methods that protect both nature
and producers, identify common solution proposals for each
stakeholder, and strengthen the agricultural ecosystem in our
country and İşbank's position within this ecosystem. Within this
scope, "İmece Workshops" continued in 2023 with the themes of
"Seed" and "Dairy Farming".
ੵ Digital Agriculture Solution Stations Project (DTC): The "Digital
Agriculture Solution" (DTÇ) project, which was launched with the
contract signed between İşbank and Vodafone A.Ş. in May 2019,
aims to use resources more effectively in agricultural production,
increase quality and efficiency, and support sustainable and value-
added production on a national scale with advanced technological
hardware and software. The "Digital Agriculture Solution" project
not only made tangible economic contributions to our country's
agriculture and farmers, but also set an important example in terms
of sustainability practices in the agricultural sector. Within the
scope of the Digital Agriculture project carried out with Vodafone
Business, recommendations made to farmers resulted in an
economic benefit of TL 198 million and TL 325 million in 2022 and
2023, respectively.
ੵ The Bank participated in panels, congresses, and seminars
organized by universities and various publishing organizations.
ੵ To date, more than 25,000 farmers and 1,550 students have
been introduced to organizations such as Farmer Meetings and
Agricultural Banking Awareness Seminars at universities to raise
awareness among the target audience. In 2023, 3,676 farmers
were attended 38 farmer meetings.
ੵ The second and third meetings of the Agricultural Banking
Advisory Board, which consists of sector representatives and
leading farmers, were held to prioritize specific topics that will affect
the development of agriculture and to incorporate their suggestions
into activities.
ੵ The second period of the Workup Agri Entrepreneurship Program,
led by the Digital Banking Division to support agricultural initiatives
focused on digitalization and sustainability, was completed.
ੵ Employee trainings continued to improve the knowledge and vision
of İşbank employees on agriculture and agricultural banking and to
increase their communication with farmer customers.
ੵ Agricultural Banking Awareness Seminars were organized at
universities to improve the Agricultural Banking vision of students
in faculties of agriculture; in this context, 650 students attended 9
seminars in 2023.
ੵ The Bank participated in 29 agricultural fairs.
ੵ The number of Agriculture Specialized Branches increased to 24. In
2023, 1,256 farmers attended 29 events organized at Agriculture
Specialized Branches.
ੵ The Instant Agriculture Loan, which is suitable for the income
structure of farmers, has been made available to customers on
digital channels, including a flexible installment payment option.
ੵ Imece Card Limit Increase application, which allows customers to
increase their unsecured Imece Card limits via İşCep, was put into
use.
ੵ End-to-end Imece Card allocation was made available through
digital channels, enabling agricultural customers to easily obtain an
Imece Card.
ੵ In order to increase the services offered through digital channels,
the “ELÜS Account Document Creation” process was added to
İşCep.
ੵ Developments were completed to add the "ELÜS Cancellation
Request" feature to İşCep, which will enable customers to make
ELÜS cancellation requests for the products they want to receive
from licensed warehouses without visiting the branch.
ੵ Developments for end-to-end digital disbursement of allocated
agricultural loans within the limits of the General Cash and Non-
Cash Loan Agreements (GNGKS) signed with our customers
in the Agriculture Enterprise and Agriculture SME segments
were completed and made available to branches/customers via
Commercial İşCep and Commercial Internet Branch.
ੵ Within the efforts to digitalize the wet signature documents
(Debit Card Agreement, GNGKS, etc.) within the Imece Card Loan
allocation processes carried out by the branches in order to save
paper and time, the Open Imece Card and Debit Card Agreement
were included in the digital approval application.
ੵ As of year-end 2023, the Bank ranked first in a survey conducted
in the field of Agricultural Banking including public banks which
measured satisfaction and net promoter score.
Supporting Women's Participation in the Economy
İşbank believes that sustainable development can be achieved by
increasing women's engagement in the economy as producers
and entrepreneurs, and providing them with job opportunities. To
this end, the Bank increasingly uses both its own resources and
foreign funds to support female enterprises. İşbank, a signatory of
the United Nations Women's Empowerment Principles (WEPs) and
included in the 2023 Bloomberg Gender Equality Index (GEI), has
committed to providing TL 100 billion in financing to women business
owners within 5 years as of 2023 with its "Women's Empowerment
Declaration". With this goal, İşbank clearly demonstrates its
support for the Leading Women Entrepreneurship for Accelerating
Development economic life.
The Bank disbursed TL 49,504,774 to agricultural segment
customers from the SME Women's Support Package campaign,
which was made available as part of the funding provided by the
EBRD. As of November 22, 2023, according to TEFAS data, İş Asset
Women in Workforce Equity Fund reached an investment size of TL
773 million with over 23,500 investors.
In 2023, the Farmer Women's Meetings organized in Adana and
Çanakkale, aimed for farmer meetings focused on gender equality.
A special event was organized for International Day of Rural Women.
İşbank and its subsidiaries support farmer women initiatives, and
trainings have been planned. In addition, TL 404 million in loans
were extended to farmer women in 2023 with the financing support
provided by our Bank.
There are campaigns for women entrepreneurs with favorable
maturity and price conditions. Resources provided by international
financial institutions are being utilized for special purposes that
contribute to sustainability.
Under the main sponsorship of İşbank, the WeLead project provides
training and mentoring entrepreneur women. As of the end of
2023, there were 5,043 registered users of the Women Power
in Entrepreneurship training portal. With the Leading Women
Entrepreneurship for Accelerating Development Project, 40
entrepreneur women received a "0-interest, collateral-free loan" of
TL 3,100,000 under the guarantee of Applied Value Group. In 2023,
the total amount disbursed to women entrepreneurs amounted to TL
35,000,000,000.
With the vision of sustaining economic and social development,
İşbank aims to reach 15,000 women entrepreneurs for training on
financial literacy in 5 years under the umbrella of Women In addition,
a 6-9 month mentoring program was launched for 50 women. The
50 entrepreneur women who completed the trainings received
mentoring/coaching support for 6-9 months by experts in their fields
and 28 women who successfully completed the mentoring process
received business development support by Türkiye İş Bankası.
WeLead 2023 trainings under the main
sponsorship of İşbank:
Company Establishment and Company Types, Company
Expenses, Taxation Processes
Product-Market Fit and Marketing
Business Development and Lean Entrepreneurship
Psychological First Aid in Disasters
Personal Data Protection Law Training
Purchasing and Supply
Gender-Responsive Procurement (GRP)
Trauma, Crisis, and Grief Management
Information Literacy
Basic Excel Usage
Digital Literacy
How to Become a Smart Business Company?
Digital Transformation and Maturity Analysis
Design-Oriented Design Education
Digital Marketing 101
Labor Law and Contracts
İş Asset Women in Workforce Equity Fund
At least 80% of the total portfolio value of the fund is consistently
invested in partnership shares of BIST-listed companies that support
women's participation in employment and management, enabling
investors to support this field.
Nays
Nays, which offers its target audience of students and young
professionals the opportunity to meet their daily financial needs with
a simple and easy experience, reached 3 million users by the end of
2023.
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ARYA Venture Capital Fund, a venture capital investment fund with
a total size of USD 10 million, was established in November 2022
with an investment commitment of USD 5 million by our Bank to
ensure gender-balanced growth in the ecosystem. In 2023, the fund
invested USD 2.4 million in 10 technology startups with female co-
founders.
Enabled Banking
İşbank makes all its services accessible to people with disabilities. In
this context, audible light guidance, tactile walking surface, disabled
ramp and ATM applications suitable for disabled access were
prepared in the branches for the visually and hearing impaired. As
of the end of 2023, all our branches are suitable for the use of our
orthopedic and visually impaired customers.
In ATM devices, on the other hand, SMS messages are sent with
the support of headphones and tactile surfaces, and features are
regularly improved. The voice menus in the ATMs are designed
in accordance with the standards set by the Banks Association
of Turkey. 99.4% of ATMs are suitable for use by visually impaired
customers.
Each province will have at least one İşbank ATM that is accessible
to those with orthopedic disabilities, and all devices will have a
headphone jack.
Transactions such as signing contracts, opening accounts, using
loans, and receiving card applications will be carried out safely and
easily by all disabled customers. Hearing-impaired customers who
want to receive service from the branches, qill receive service by
making video calls with the employees hired specifically for this
issue at the Call Center. In 2024, the aim is to increase the number
of branches suitable for the use of disabled customers and to
make more ATMs compatible to orthopedic and visually impaired
customers.
In İşCep, voice-over programmes for visually impaired customers
on iOS and Android are compatible with Voice Over TalkBack, while
the Internet Branch uses BlindLook, which, with its voice-over and
voice-oriented technology, makes every product and service offered
freely available to the visually impaired, cares for the visually impaired
consumer and creates visually impaired brands." With the "Dynamic
type" feature, text sizes can be enlarged and reduced on İşCep.
İşbank's corporate internet branch is also compatible with Jaws. The
"Barrier-Free Banking" page is opened on the corporate website,
isbank.com.tr /en and necessary directions are provided for
disabled customers to carry out their banking transactions without
any problems. At the same time, for hearing-impaired users, the
content on both the "Banking without barriers" and "Help" pages
is translated into sign language via an avatar using the barrier-free
translation plug-in.
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. İşbank's corporate website
(www.isbank.com.tr /en), İşCep, and Internet Branches were
awarded Eye Brand certification.
361
Number of Bankamatik
ATMs suitable for use by
orthopedically impaired
customers
1,066
Number of branches
suitable for use by visually
and orthopedically impaired
customers
99.4%
Ratio of disabled-friendly
Bankamatik ATMs
Financial Literacy
İşbank aims to increase the financial literacy level of its customers from all segments of society in order to enable customers to make the right
decisions regarding their financial situation and to increase trust in the financial sector.
Financial literacy workshops are held at the İşbank Museum.
Within the scope of financial literacy trainings, activities are organized for all farmers, especially agricultural specialization branches, as of December
2023. With the participation of entrepreneurs, academics and affiliates, activities are carried out to improve the financial, agricultural, digital and
climate literacy of farmers through activities in fairs, branches and other places, as well as banking products and services on waste management,
soil fertility, energy saving and efficiency. In addition, in the field of agricultural banking, financial, digital and agricultural literacy support is provided to
farmers through the ImeceMobil application, which can be downloaded free of charge.
In particular, the Bank carries out activities to increase the financial literacy of women. In line with these studies, in 2023;
Within the scope of the Leading Women Entrepreneurship for Accelerating Development Project carried out in cooperation with TURKONFED;
face-to-face trainings were held in various provinces of Turkey on Introduction to E-Commerce, Entrepreneurship, Digital Marketing, Sales
in Marketplaces, Gender-Responsive Procurement; Online trainings were given on Company Establishment and Taxation, Entrepreneurship,
Introduction to E-Commerce, E-Accounting, E-Invoice, Micro Export, Trademark, Patent and Design, Quality Process Improvement and Process
Development, Facebook Advertising Panel.
In the Entrepreneur and Investor Academies and Business Workshops organized in cooperation with the Arya Women's Investment Platform, serial
trainings that contribute to the financial literacy of women entrepreneurs continued to be offered free of charge.
Economic Research
İşbank's Economic Research Division closely monitors cyclical, structural, and macroeconomic developments in both the national and global
economy and prepares daily, weekly, and monthly reports. These include
Daily Market Bulletin
Weekly Bulletin and
Developments in the World and Turkish Economy
Additionally, monthly "Data Analyses" reports, including Economic Growth, Inflation Developments, Budget Balance, and Balance of Payments, are
published on the website.
In 2023, the Economic Research Division published 4 Sectoral Current Developments bulletins and 9 sector reports. The published sector reports
cover renewable energy, steel sector, facility management, automotive, tourism, housing, and logistics storage sectors, as well as the textile
and agriculture sectors with content including the effects of the earthquakes in February. An Assessment on the Planning of Agricultural Production
was also prepared. In addition, the "Course of Consumption Spending Per Sector" study is published monthly.
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Climate Action
Climate change is one of the most urgent
problems facing our planet, affecting the
environment, social life, and economy worldwide.
İşbank conducts risk and opportunity analyses to
protect our resources and builds partnerships to
be a part of the solution in climate action.
Risks
Challenges in accessing finance for climate action
Existing financial solutions proving to be ineffective as a result of changes
in the way of doing business and risk levels across many sectors due to
global warming
Infrastructure deficiencies of financial institutions and regulators 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
Risk of real estate depreciation due to the physical impacts of climate
change
Opportunities
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
Explaining the solutions offered to customers in the right way with effective
customer communication and specialization
Key Performance Indicators
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 Security Report
2021
2022
2023
5
9
331
32.3
44
8
432
40.9
33
12
216
48.1
1,008
2,059
2,659
71
B
C
75
A-
B
77
A
A-
Targets
Efforts to increase the share of renewable
energy in the total energy generation projects
portfolio will continue.
100
The Bank completed its
activities on this front.
The goal is planned to be
preserved.
Realization in 2023
Realization Status
Targets for 2024 and Beyond
Material Topics
Climate Action
Contributed SDG's
Related Capital Elements
Financial
Capital
Intellectual
Capital
Social-
Relational
Capital
Natural
Capital
Within the scope of the NZBA commitment,
The Bank aims to continue decarbonization
efforts in its loan portfolio.
The Bank first announced
its intermediate targets for
2030 regarding emission
reductions in the carbon-
intensive sectors such as
power generation, cement
and iron and steel.
The Bank is continuing its
activities.
The annual realization status
of the intermadiate targets
announced in 2023 will be
disclosed.
Emission intensity reduction
targets will be set for other
carbon-intensive sectors.
Transition plans will be prepared
and announced.
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Decarbonization Targets
Climate Risk Management
The Net-Zero Banking Alliance (NZBA), established by the United
Nations with the leadership of the financial sector, brings together
more than 140 banks which have committed to align their investment
and loan portfolios with the net zero emissions target by 2050,
representing more than 40% of global bank assets as of March 2024.
The main objective of the Alliance, that has established the first global
banking-specific net zero standard for the banking sector, is to enable
the transition of the real sector to a low-carbon economy by financing
the transformation required for the decarbonization of the economy.
Member banks that undertake to publicly announce their (2030)
intermediate and long-term (2050) targets in line with the Paris
Agreement by complying with the below criteria
Set targets for at least one of the most impactful carbon-intensive
sectors within 18 months of commitment,,
Cover the majority of carbon-intensive sectors within 36 months,
Targets will be reviewed in maximum 5-year periods and new
intermediate targets will be defined for each 5-year period starting
from the first intermediate target year (2030);
Studies should be based on a scientific basis in a way that will
contribute to global climate goals,
Report the annual public reporting of progress against the targets,
and
Studies to be subjected to an independent assurance.
In 2023, İşbank first announced its 2030 targets for emission
reduction in the power generation, cement and iron and steel
sectors, which are among the carbon-intensive sectors. Accordingly,
by 2030,the aim is to reduce the emission intensity by 61% in the
power generation sector, 21% in cement and 10% in iron and steel
compared to the 2021 base year. While determining the sectoral
reduction targets relying on base year values, science-based global
scenarios were taken into account. Mitigation targets and considered
international scenarios are as follows:
The Bank followed the Partnership for Carbon Accounting Financials
(PCAF) methodology, for calculating the financed emissions in these
sectors. By making a detailed calculation based on sectors, the goal
is to measure as near to reality as possible while maintaining the
highest level of data quality. The aim is to reach the healthiest data by
conducting surveys and one-on-one interviews with customers.
With its decarbonization efforts, the Bank;
Correctly determines the actions that credit customers can take on
the way to decarbonization and to guide customers in this context,
and
Aims to provide the financial support required for green and
sustainable practices that its customers will need during
decarbonization.
In addition to the intermediate targets of the Net-Zero Banking
Alliance, İşbank announced that it would not finance investments in
new thermal power plants using coal and natural gas for electricity
generation in 2020 and would not finance new coal mining
investments in 2021. In 2023, the Bank also announced that it
would end financing coal-related activities by 2040, in line with its
commitments to the Net-Zero Banking Alliance. Within the scope
of the gradual exit from coal, the Bank announced that by 2040,
coal and coal-related "coal mining", "activities related to the logistics
of coal and subcontractor activities" and "infrastructure services
allocated / allocated to support coal-related activities" will be phased
out.
İşbank's commitments to sustainability demonstrate its commitment
as a responsible financial institution to contributing to the fight
against global climate change. Decarbonization relevant disclosures
are as follows:
Sector
Metric
Scenario
Emission
Coverage
Base Year - 2021
2030 Reduction
Targets
Power
Generation
kgCO2 e / MWh
International Energy Agency (IEA - NZE
2050)
Cement
kgCO2 e / ton
Science-Based Targets 1.5oC (SBTİ 1.5oC)
Iron & Steel
kgCO2 e / ton
Science-Based Targets - 1.5oC (SBTİ 1.5oC )
1+2
1+2
1+2
Coal
617
1.175
801
-61%
-21%
-10%
Phase-out by 2040
Note: Depending on the developments in methodologies, the numerical values in the table may vary.
Risks arising from climate change are radically affecting business
practices and risk levels across all sectors. It is important for
financial institutions to closely monitor these changes and take the
necessary actions to avoid significant commercial risks and seize
the opportunities created by the transition economy. İşbank takes
into account all risks arising from climate change. These risks are
assessed and prioritized using a combination of qualitative and
quantitative methods.
Climate-related risks and opportunities were integrated into business
processes and 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.
İşbank aims to:
Be a guiding business partner for customers to develop adaptability
with new regulations such as the Green Deal and Carbon Border
Adjustment Mechanism,
Play a leading role in the green transformation of the national
economy within the framework of Net-Zero Banking Alliance
membership,
Increase the share of sustainability-themed loans and resources in
the balance sheet,
Reduce greenhouse gas emissions, energy consumption, vehicle
fuel consumption, and waste production,
Diversify and increase the volumes of environmentally friendly
financing products and increase their volumes.
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 face in connection with its
activities. The 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
that the Bank's activities are aligned with its climate change strategy.
Responsibilities regarding climate change risk management have
been defined in the form of a triple defense line. The role of the
first line of defense is to ensure that the loan decisions are made
by considering climate change risks. 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 offers
reassurance to the Board of Directors that the existing roles and
responsibilities function properly.
A large portion of the Bank's exposure to climate risk arises from
its customers in the commercial loan portfolio. To meausre this risk,
the commercial loan portfolio covering all sectors is analyzed. A
two-stage approach is followed to assess the exposure of the loan
portfolio to climate risks:
1
A sectoral climate change risk heat map is used to identify
the sectors that should be prioritized when assessing climate
change risk. A 5-level risk scale is used to determine to what
extent each sector is exposed to climate risks.
2
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.
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. 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 considering the
additional liabilities mentioned, and the possible effects of changes
in the customers' creditworthiness on the Bank's balance sheet are
analyzed. Financing assessments are also carried out to contribute
to the carbon emission reduction 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 believes in the power of collective action in combating climate
change. For this reason, the Bank is involved in numerous local and
global initiatives.
ό The Carbon Disclosure Project (CDP) Climate
Program
The program is an independent institution that mediates companies
to report to investors how they manage their activities to reduce
carbon emissions and their risks related to climate change. İşbank
has been reporting within the scope of CDP since 2019.
İşbank took its place among the Global Leaders with an "A" score
with its 2023 Climate Change Program Reporting within the
framework of CDP.
İşbank is a member of the Net-Zero Banking Alliance (NZBA), which
was established by the United Nations to enable member banks
to align their portfolios with net-zero emissions targets by 2050 in
line with the Paris Climate Agreement. With the NZBA commitment,
İşbank aims to take advantage of the opportunities that will arise
during the transition to a green economy, support customers' ESG
transformations, manage risks related to climate change, and act as
a guiding business partner for companies to improve their ability to
adapt to regulations that will affect economic activity such as the
European Union Green Deal and the Carbon Border Adjustment
Mechanism. With this membership, and in order to achieve its
net zero targets by 2050, the Bank committed to supporting its
customers' transition to a net-zero economy by focusing its 2030
targets on carbon-intensive sectors, and to report and publish the
progress it has made in its emission targets on an annual basis.
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Reliable Financial ActorLooking Into the FutureAn Overview of İşbankHow We Create ValueResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report İşbank is committed to confirming its emission reduction targets
under the Science Based Targets (SBT).
İşbank is a signatory to the United Nations Environment Program
Finance Initiative (UNEP FI) Principles of Responsible Banking
(PRB). The Bank thus aims to ensure alignment of its activities with
the targets set forth in the United Nations Sustainable Development
Goals (SDGs) and the Paris Climate Agreement. 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 Reports within the scope of UNEP
Principles for Responsible Banking
here.
The European Fund for Southeast Europe S.A. (EFSE), in
cooperation with Finance in Motion Gmbh (FiM), a German financial
institution, is funding a joint project for the agricultural sector in
Türkiye. Within the project, studies were made to measure the carbon
footprint of wheat, barley, sunflower, and corn producers. Within the
cooperation, the Bank supported the financing of events such as
various trainings, farmer meetings, and İmece Workshops, which
aim to contribute to sustainable agriculture, for bank employees and
producers in the agricultural ecosystem. Discussions are ongoing
with these organizations to continue Phase 2 studies on carbon
footprint calculation in 2024 as well.
The Turkish Foundation for Combating Soil Erosion, for
Reforestation and the Protection of Natural Habitats (TEMA)
carries out activities in the fields of forestry, rural development,
education, advocacy and environmental policies, climate, and
biodiversity in order to show that erosion and desertification, which
threaten the land, can be prevented, to draw attention to the danger,
to protect the soil, to produce protective solutions, to reforest, to
protect natural assets, and to ensure that this struggle becomes a
state policy.
The Turkish Marine Research Foundation (TÜDAV), organizes
workshops, courses, and policy recommendations on many current
issues such as pollution in the Turkish straits, marine biodiversity,
sustainable fishing, marine protected areas, and maritime law and
cooperates with relevant institutions to prevent ship-borne pollution
in order to protect marine life and convey marine culture and love
to future generations, In cooperation with İşbank and TÜDAV, the
"Future of the Seas Seagrass Meadows" project aims to protect
Posidonia oceanica seagrass meadows, which are of critical
importance for the Marmara Sea. The project aims to map Posidonia
oceanica seagrass meadows, clean them from waste, and protect
them.
The Middle East Technical University (METU) Institute of Marine
Sciences conducts basic research in its region to study the major
challenges affecting humans and nature in the seas of Türkiye and
the world's oceans, transform its research findings into products
and solutions for the welfare of society and the development of a
sustainable blue economy in the seas, and transfer its knowledge and
experience through trainings and social responsibility activities. With
84
the approach "The world is ours, the future is ours", the cooperation
between İşbank and Middle East Technical University (METU)
for the prevention of pollution in our seas and the sustainability of
the ecosystem continued in 2023 as well. The Sea Explorer, an
unmanned underwater glider, which was made available to METU
to support the marine studies of the entire academia and scientific
world under the leadership of the METU Institute of Marine Sciences,
was launched in the Marmara Sea during the critical period when
oxygen levels dropped to the lowest points following its explorations
in the Marmara Sea and the Mediterranean Sea. With the research,
the risks of mucilage will be mapped comprehensively for the first
time in Türkiye.
İşbank participates in the activities of the Climate Risk Sub-Working
Group of the Banks Association of Türkiye (TBB). The Bank
expressed its opinion on the Communiqué on Green Asset Ratio
(Draft).
ό Managing of Water Risks
At İşbank, water-related risks 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 with the
Top-Down Risk Assessment methodology, which is an approach
used to assess and prioritize operational risks that may arise while
conducting activities. The Bank 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.
Drought risk, which may increase in frequency and severity in
connection with water and climate change risks, may have a
significant impact on the Bank's asset quality, particularly through
loans extended to Hydroelectric Power Plants (HPP). Increased
frequency and severity of weather events such as hail, storms, and
heavy rainfall that may damage cultivated crops may halt production
and reduce yields in the agricultural sector. Extreme weather events
may lead to increased default risks for customers and deterioration
in the quality of loans extended to sectors exposed to water risks,
particularly the agricultural sector.
Increased frequency of extreme weather events, such as floods
could result in damage to the Bank's assets and/or customer assets
(e.g. assets in safe deposit boxes) located at the Bank's premises.
In addition, there are risks such as loss of value of the real estates
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
carries out studies in cooperation with the main stakeholders in its
ecosystem in risk assessments regarding water.
Within this scope:
Various collaborations are conducted with TEMA.
Regarding effective measurement of water footprint and efficiency
studies, cooperation is being carried out with the Frankfurt School
of Finance & Management.
At Farmer Meetings, participation of academics who know the
region, water, and soil and can guide farmers is ensured, and
cooperation with universities is developed.
The Bank works effectively with non-governmental organizations,
chambers, and unions.
Credit campaigns for irrigation systems are organized, and
initiatives using new technologies are introduced at fairs and
Farmer Meetings.
ό Water Management Platform
A cooperation was established with the Water Management Platform
offered by Blueit, Türkiye's first industrial and artificial intelligence-
supported company that monitors water consumption in industrial
facilities and commercial buildings in real time and optimizes it by up
to 20%, Platform aims to provide SME customers with the services
of efficient use and effective management of water, receiving
instant water consumption data, and providing control and technical
support with remote access for 12 months. The Water Management
Platform analyzes water consumption data collected from water
meters, flow meters, and sensors according to ISO and various water
regulation standards and ensures the most efficient use of water.
With the technology developed specifically for SMEs, both water
costs and water-related energy costs of enterprises are reduced, and
wastewater discharge is optimized.
ό Managing of Forest Risks
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 work are addressed in order to
conduct an assessment of forest-related risks. 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 relocating trees around the project area to appropriate areas and/
or planting trees in place of any cut down, in order to eliminate the
negative effects of the investment in sensitive areas. Tree planting
commitments are received from projects, particularly linear projects
and thermal power plants. These commitments are included in
contracts and monitored annually.
ό Managing of Biodiversity Risks
While risk categories are identified as part of the Environmental
and Social Impact Evaluations done by the Bank, biological risks are
evaluated on a per-project basis. A Biodiversity Action Plan (BAP) is
requested for projects in the Risk A category with high biodiversity
risks. In the ÇESMOD question set, the need for a critical habitat
assessment and balancing strategy study is required for all relevant
projects. On a sectoral basis, additional impact questions such as bat
habitat, bird migration routes, and biodiversity issues are considered.
Investigations are carried out together with biologists in projects
that are monitored within the scope of ÇESMOD and involve high
biological risk, and related problems are evaluated on a project-
specific basis.
Environmental and Social
Risk Management in Loans
At İşbank, new investment projects with an investment value over
USD 10 million are subjected to the Environmental and Social Risk
Evaluation Tool (ÇESMOD). With the updates made to the ERET model,
which İşbank had used to calculate the Environmental and Social Risk
Score of investments, ÇESMOD (Environmental and Social Model),
a new Environmental and Social Risk Evaluation Model that is more
closely aligned with the global risk measurement standards and can be
tailored according to the type of investment, was developed. In 2022,
the transition process from ERET was completed, and the new model
was put into use.
In the ÇESMOD Model, environmental and social (E&S) risk scores
for investments financed by the Bank are calculated following 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, with evaluations
conducted with specific sets of questions based on the sector in
question.
Sets of questions based on type of investment and
sector:
EIA decisions, environmental permits, environmental and/or social
impact evaluation,
Nature preserve, critical habitat, and ecosystem evaluations,
Earthquake risk,
Natural resource use,
Waste management,
Air, soil, and water quality,
Noise and dust,
Occupational health and safety, public health and safety,
Management of chemicals,
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. In the ÇESMOD model, sector-based
questions are asked on 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.
Based on the evaluations made, the risk level of the project is
determined as high (A), medium high (B+), medium low (B-) or 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 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.
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Reliable Financial ActorLooking Into the FutureAn Overview of İşbankHow We Create ValueResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report 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 independent environmental consultant is not appointed,
ESSE, ESAP and monitoring activities are carried out by İşbank SF
service specialists if necessary.
In 2023, 27 investments were subjected to Environmental and Social
Risk Evaluation and 12 of these projects have been funded. A total of
130 projects were financed between 2013 and 2023.
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
33
27
12
4 B+ ’s
4 B-’s
4 C ’s
İşbank Sustainable Finance Framework
İşbank expanded the scope of the Sustainability Bond Framework in
2021 and has transformed it into the Sustainable Finance Framework.
This allows the Bank to focus eurobond issuance and loan processes
on green, social, or sustainability themes. Funds obtained from the
bonds issued under the framework will be allocated to projects with
a positive environmental impact in the areas of renewable energy,
energy efficiency, recycling, organic agriculture, clean transportation,
green buildings, and circular economy, and to finance loans with
a positive social impact, such as financing SMEs and women
entrepreneurs in underdeveloped regions. The opinion of an external
evaluation institution was obtained for the Framework prepared in
accordance with the Green Bond Principles, Social Bond Principles,
and Sustainability Bond Guidelines published by the International
Capital Markets Association (ICMA) and the Green Loan Principles
published by the Loan Market Association(LMA).
Sustainability Analysis System (SÜRAS)
As climate change and its risks are increasing, there is a need to
improve existing ways of doing business and review them in line with
international best practices. Therefore, in addition to the investment
types evaluated within the scope of ÇESMOD, a process for
assessing environmental and social risks was designed and put into
operation for the commercial loan portfolio in 2022. The new process,
called the Sustainability Analysis System (SÜRAS), includes the
“Environmental and Social Question Set”, which enables companies
to determine the environmental and social risks and the “Climate
Change Question Set”, which enables the companies to determine
awareness and resilience levels on climate change risks. SÜRAS
also enables an effective customer analysis process for loan uses
from resources provided by international financial institutions. The
new system also includes question sets, which ask for environmental
and social criteria that are expected to be fulfilled by customers as a
condition of use from these international loans.
Activities Not Financed
İşbank rejects any loan applications for activities on the İşbank
Exclusion List, which the Bank included 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 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.
In 2023, "Activities violating human rights", "Capacity increase of
existing coal mines and coal-fired power plants", "New coal mines
using the Mountain Top Removal Mining (MTR / MTM) method",
"Radioactive material (power generation plants and health equipment
that meet the best international standards and are established to
meet the basic energy needs of the country and are critical for the
country's economy, production and/or trade (except in cases where
the use of quality control devices and radioactive materials is limited,
insignificant and adequately protected)" and "Trade in goods without
the necessary export/import licences or other evidence of transit
clearance" were added to the Bank's List of Non-Financed Activities.
On the same date, in order to support the green transformation of
the economy, İşbank announced that it will gradually phase out coal
finance by 2040.
Products and Services
Contributing to a Green Economy
As a source of finance, banks have the power and opportunity to
create green transformation in the economy through their lending
processes. Recognizing its power and responsibility, İşbank develops
numerous products and services that support a green economy.
In international debt markets, the Bank has the opportunity to
access these resources due to investor interest in green, social,
and sustainability themed/linked resources, especially in recent
years, with the aim of reducing the negative impacts of climate
change and creating equal opportunities for various segments
in the social sphere. Within this scope, the Bank closely monitors
both developments in local legislation and such borrowings in
the international arena and regularly and continuously evaluates
sustainability-themed eurobond issuances and sustainability-
themed/linked loans that are in line with its needs and expectations.
The İşbank Sustainable Finance Framework was established for such
issuance opportunities, and within the scope of the Global Medium
Term Note (GMTN) Program, efforts are made to make maximum use
of such issuances and to increase the share of sustainability-themed/
linked borrowings in overall borrowing.
With the introduction of the Carbon Border Adjustment Mechanism,
potential carbon tax calculations are being planned for customers
that may be affected by this mechanism and added to feasibility
studies. On the other hand, the aim is to discuss action plans to
reduce the values of loan customers with high emission intensity
within the scope of NZBA commitments.
ό
Financing Renewable Energy
Renewable energy investments play an important role in climate
action and also provide significant economic benefits through the
creation of new business lines. 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 of the new project financing provided by the Bank for
electricity generation investments after 2015 has been allocated to
renewable energy projects.
In 2023, the share of financing provided for renewable energy loans
in the risk of electricity generation loans is 77.3%
The total annual energy savings from these renewable energy
projects is 7,894,870.94 tonnes of CO2. As of 31.12.2023, the total
energy generated by the financed renewable energy projects is 48.13
million MWh.
The renewable energy plants within Borusan EnBW Enerji Yatırımları
ve Üretim A.Ş. have been refinanced by a consortium including
İşbank, and the related loan has been financed as Green Loan within
the scope of the refinancing. The Green Loan covers a total installed
capacity of 594.55 MW. The financing package includes WPP
and SPP plants. An environmental and social management system
("ESMS") will be developed to oversee project activities. In addition,
ISO14001 and ISO 45001 Certification processes have started as of
the beginning of 2022.
Within the framework of the risk category, on behalf of the lenders,
environmental and social impacts have been identified within the
scope of Borusan EnBW Enerji Project within the framework of local
legislation and regulations, Equator Principles, IFC Performance
Standards, EBRD Performance Criteria and international best
practices, and an Environmental and Social Action Plan ("ESAP") has
also been prepared to manage the identified impacts for the Project.
This financing serves Sustainable Development Goals 7.1, 7.2, 13.3
and 17.3.
Distribution of loans disbursed in 2023 regarding renewable energy projects
Total Installed
Capacity (MW)
Cash Risk
(USD Million)
Non-Cash Risk
(USD Million)
Total Risk
(Cash Risk + Non-
Cash Risk) (USD
Million)
Electricity
Generation
Amount
(Million
kWh) *
Electricity Generation
Amount by the Ratio of
Financing Share Provided
(Million kWh)
Type
BPP
SPP
HPP
WPP
GPP
17
1,367
375
901
0
4.22
17.57
0.20
0
0
TOTAL
2,659
21.99
0.04
1.17
3.43
143.52
0
148.17
4.26
18.74
3.64
143.52
0
170.16
0.04
0.20
0.17
2.12
0
2.52
0.02
0.02
0.01
0.30
0
0.36
* Breakdown/total amount of energy produced by RE investments added to the portfolio in 2023, on the basis of energy type.
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Reliable Financial ActorLooking Into the FutureAn Overview of İşbankHow We Create ValueResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report As of the end of 31.12.2023:
ό Pressurized Irrigation Systems Loan
ό Forest for the Future
Total Installed
Capacity (MW)
Total Production in
2023 (Million MWh)
Cash Risk (USD Million)
(Including Discount)
Non-cash Risk (USD Million)
(Including Check and Derivative
Risks)
Total Risk (USD
Million)
273
4,341
8,076
1,271
6,125
20,086
1.94
4.71
17.98
7.54
15.96
48.13
81.18
364.76
860.91
561.75
186.03
2,054.64
68.26
28.30
22.32
27.47
413.17
559.53
149.44
393.07
883.23
589.23
599.00
2,613.97
Type
BPP
SPP
HPP
GPP
WPP
Total
ό Earthquake region financing in cooperation
with the European Bank for Reconstruction and
Development (EBRD)
İşbank signed an agreement with the EBRD to provide a loan of
USD 109 million within the scope of the Türkiye Disaster Response
Framework established by the EBRD to support the financing of
businesses and individuals directly affected by the earthquakes that
occurred in our country on February 6, 2023, as well as companies
participating in the recovery and reconstruction efforts in the region.
The loan is planned to be used initially to meet the financing needs
of businesses and individuals directly affected by the earthquake in
11 provinces in the earthquake region. In addition, a resource of USD
100 million was obtained from the EBRD as part of the securitization
transaction based on remittance flows in November. USD 80 million
of this resource is used to finance companies providing products and
services to the earthquake region, while the remaining part is used to
finance SMEs managed/owned by women.
ό
Sustainability-linked syndication loans
İşbank secured a sustainability-related syndicated loan amounting
to USD 224 million and EUR 388.25 million in June 2023, and
another one amounting to USD 465 million and EUR 411 million
in November. The sustainability performance criteria for these
syndicated loans were determined as the amount of cash loans to
be extended to small and medium-sized women entrepreneurs and
the amount of consumer loans to be extended to individuals in the
11 provinces affected by the earthquake. In 2023, the total amount of
sustainability-related syndicated loans provided amounted to over
USD 1.5 billion.
ό Earthquake region financing in cooperation with
the International Finance Corporation (IFC)
İşbank signed loan agreements totaling USD 67 million and EUR 75
million with IFC, PROPARCO, and the Green for Growth Fund (GGF)
as part of the Türkiye earthquake support package established by
IFC to contribute to the financing of individuals, farmers, micro and
small enterprises directly affected by the earthquakes that occurred
in our country in February 2023. The GGF loan will be used to finance
renewable energy, resource efficiency, and energy efficiency in
Türkiye.
ό New resources for green transformation and a
sustainable economy
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
88
September to issue green and/or sustainable bonds or commercial
papers, including debt instruments that can be included in the
calculation of equity in accordance with the Regulation on Equity of
Banks, up to USD 2 billion abroad. Within this scope, 16 sustainable
eurobonds were accordingly issued under the Global Medium Term
Note (GMTN) Program for a total amount of USD 402 million in 2023.
ό Green Fund
TSKB, a subsidiary of İşbank, secured a USD 155 million loan from
the World Bank under the guarantee of the Ministry of Treasury and
Finance for the establishment of the Türkiye Green Fund. The Türkiye
Green Fund, the first venture capital investment fund in Türkiye and in
the world to be financed with a loan, focused on emission reduction
and inclusive transformation, will make a significant contribution to
our country's 2053 Net Zero target with its roadmap centered on
managing climate risks. The project will mobilize the contribution of
the private sector as well as the public sector in meeting the current
financing deficit in our country and will provide the beneficiary
companies with a balanced level of indebtedness and strategic
growth opportunities through equity investments. This project, which
will also contribute to the development of capital markets with its
innovative structure, is targeted to reach a total equity amount of
USD 405 million, with USD 100 million at the fund level and USD 150
million at the firm level, in addition to the World Bank loan of USD 155
million.
ό
Green Bond
İşbank issued green bonds amounting to TL 500 million with a
maturity of two years in 2023. It was the first green debt instrument
issuance of the banking sector in Türkiye. The funds obtained from
the issuance will be used for financing the loans granted to green
projects.
With this product, İşbank became the first bank in Türkiye to issue
a green debt instrument in TL in accordance with the principles set
out in the "Green Debt Instrument, Sustainable Debt Instrument,
Green Lease Certificate, Sustainable Lease Certificate Guidelines"
published by the Capital Markets Board (CMB).
ό
Green Enterprise Loan
The Green Enterprise Loan is a product 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. In 2023, a total of
TL 127 million financing was provided.
İşbank supports farmers regarding pressurized irrigation systems
through its cooperation with BASUSAD. Within this framework, the
Bank finances the installation of pressurized irrigation systems.
The economic benefit provided in 2022 with loans that finance the
transformation investments of customers using wild or pressurized
irrigation continues.
ό Green Loan and Green Mortgage
This Green Loan product aims to increase energy savings through
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.
ό Green Vehicle Loan
Individuals and commercial customers can benefit from the Green
Vehicle Loan campaigns organized for electric and hybrid model
vehicles, and improvements are made in favor of customers in interest
rate/fee-commission items according to market conditions.
No loan allocation fee is charged for personal vehicle loans within the
scope of the campaign. The total amount of loans extended in 2023
for electric and hybrid vehicles amounted to TL 141,5 million.
ό Solar Loan by İşbank
The loan aims to finance rooftop, facade, and land-type unlicensed
SPP investments for self-consumption purposes In 2023,
1,200,000,000 TL was disbursed in this scope.
ό 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.
ό 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.
ό Water Security Loan
This 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 an environment where living creatures can
thrive and protecting the existence and survival of life forms. In 2023,
the Worth Water Loan disbursement amounted to approximately TL
50,200,000.
With the Forest for the Future application on İşCep, 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 2023, the number of participants in
Geleceğe Orman was 401 thousand, and 171 thousand saplings were
donated. The Bank aims to plant a total of 1 million saplings in the first
three years.
ό Iş Asset TEMA 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 2023, the total value of
the fund was TL 82 million and the number of investors was 10,427.
The annual return is 64%.
ό Iş Asset Sustainability Equity Fund
İş Portföy Yönetimi A.Ş. issued the BIO-İş Portföy Sustainability Equity
(TL) Fund (Equity Intensive Fund) on 23.10.2023. At least 80% of
the fund’s total value is continuously invested in partnership shares
included in the BIST Sustainability Index and in exchange-traded
fund units established to track the BIST Sustainability Index. In 2023,
the total value of the fund was TL 47 million and the number of
investors was 1,397.
ό Iş Asset Renewable Energy Mixed Fund
It offers investment opportunities for those who want to invest in
stocks and private sector debt instruments of domestic and foreign
companies operating in the field of renewable energy. In 2023, the
total value of the fund was TL 571 million and the number of investors
was 11,583.
ό Iş Asset Electric Vehicles Mixed Fund
The Electric Vehicles Mixed Fund enables investment in the entire
electric vehicle production process. In 2023, the total value of the
fund was TL 1.3 billion and the number of investors was 27,256.
ό İmeceMobil
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 supporting the proper use of resources. The
"İmeceMobil" application was launched in 2019 aiming to prioritize
the agricultural sector and realize the agriculture of the future on
a more sustainable basis. It was incorporated at the beginning of
2023 with the aim of effectively using agricultural technologies
and spreading them to the grassroots. At the moment, it continues
to serve under the title of "İmeceMobil Tarım Platformu Elektronik
Hizmetler Ticaret A.Ş.". With more than 220 thousand users, the
"İmeceMobil" application enables farmers to use digital services
(Expert Assisted Satellite Service, Fertilizer Planning Service, Irrigation
Calendar Service) that enable them to monitor the plant health of
their products from planting to harvest, to manage irrigation and
fertilization planning, and to apply for agricultural cards, agricultural
loans, and insurance products of financial institutions without going
to a branch. İmeceMobil also informs our farmers about organic
and organomineral fertilizers within the scope of good agricultural
practices, IOT-supported precision agriculture practices, smart
agricultural systems, plant nutrition and protection practices carried
out with agricultural unmanned aerial vehicles both through the
application and field studies and enables our farmers to access
technological products that contribute to sustainable agricultural
production.
The ImeceMobil application reached 222 thousand users by the end
of 2023.
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Reliable Financial ActorLooking Into the FutureAn Overview of İşbankHow We Create ValueResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Innovative Bank for
100 Years
İşbank continuously improves itself by meeting
the demands of next-generation banking with its
strong digital banking infrastructure. In the 100th
anniversary of its foundation, the Bank continues
to offer its customers a flawless and secure
experience at every point of contact by using
technology in its most efficient and up-to-date
form.
Risks
Cyber security risks increased with digitalization
Management of the 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
Opportunities
Becoming a preferred to be the institution preferred by stakeholders with
data security investments
Providing personalized products to customers with digital products and
services and 24/7 accessibility
Opportunity to establish more effective communication with customers
thanks to increased efficiency through digitalization of procedures
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
Increased competitive advantage through synergies created with
subsidiaries
Relevant Stakeholders:
Material Topics:
Customers
Regulatory Authorities
Industry Stakeholders
Digital Banking and
Innovation
Cyber Security and
Customer Privacy
Contributed SDG's
Related Capital Elements:
Intellectual
Capital
Social-Relational
Capital
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)
2021
6,476
10.2
10.0
2.1
94.6
62.7
39.3
Amount of cardless transactions performed through Bankamatik ATMs (billion TL)
40.6
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)
Nays registered users (million)
64
11.0
95.6
6.7
49.1
-
2022
6,169
13.0
11.9
2.6
96.0
64.8
53.0
67.7
190
27.9
96.2
8.8
68.2
1.4
2023
6,289
15.0
14.9
2.5
97.7
74.8
43.9
82.9
238
15.4
97.1
10.7
87.3
3
Successful Transactions Index for IT Critical Services
99.96
99.97
99.98
Number of technological entrepreneurs who were supported to enter the banking
system
Number of campaigns aimed at promoting the products of technological
entrepreneurs
97
16
Fines incurred due to data security breaches (TL)
150,000
265
52
0
750
26
1,075,000
90
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Reliable Financial ActorLooking Into the FutureAn Overview of İşbankHow We Create ValueResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Targets
Targets for 2023
Realizations in
2023
Realization
Status
Targets for 2024 and Beyond
Increasing the share of digital
channels in total sales to
70%
74.8%
Completed.
To increase the share of digital channels in
total sales to 80% in 2024 and 85% in 2025.
Increasing the number of
customers using digital
banking channels to over
14.5 million
Enabling over 100
technological entrepreneurs
to enter the banking system
every year
15.0
935
Completed.
Increasing the number of customers using
digital banking channels to 17 million in 2024,
18 million in 2025 and 19 million in 2026
Completed.
Enabling over 1,000 technological
entrepreneurs to enter the banking system
Digital Banking
In line with its vision of becoming the "Bank of the Future", İşbank
goes beyond being a bank that merely meets financial needs and
aims to carry out digital banking activities by providing its customers
with a smooth end-to-end experience through innovative products
and services.
İşbank’s digital banking focus areas are:
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,
Providing customers with a seamless end-to-end experience by
developing joint services with non-Bank stakeholders within its
vision of offering banking everywhere,
Collaborating with startups that will benefit the Bank, Group
companies, and customers and implementing innovative business
models that have the potential to impact the future on a global
scale, including impact entrepreneurship with an open innovation
approach,
Developing solutions and value propositions that will assist users
and organizations in making healthy financial decisions,
Becoming an integrated business partner and gateway to the
digital world for all individual customers in personal banking and for
companies in commercial banking,
Achieving a broad-based customer portfolio with the inclusion of
both unbanked customers and commercial establishments with
limited access to financial services,
Contributing to nature and the future by adopting new practices
serving sustainability across digital channels.
The number of İşbank's digital banking users increased by 15.4%
compared to 2022 and reached 15 million. The share of non-branch
channels increased from 96.2% to 97.1%, while the share of digital
channels in sales rose from 64.8% to 74.8%.
In order to correctly predict the strategic moves capable of changing
competition in the digital world where technology is progressing
rapidly and take necessary actions, İşbank will continue its initiatives
for developing the technology and business models aligned with the
new competitive conditions. In 2024, the super app vision aims to
enrich the digital partnership ecosystem, including third-party mini-
apps, to increase new customer acquisition and provide customers
with the best experience to access the innovative and value-added
services they need throughout their life cycles.
Developments in 2023:
In 2023, İşbank made many developments in digitalization. Under
digital agriculture solutions, the İmece Platform, where companies
publish their support packages for farmers, manage their cash and
in-kind advances, and banks can extend loans to farmers in an
integrated manner, was launched.
The Health Communication Platform was launched, where all
members living in Türkiye/abroad, regardless of location, and family
members receiving health benefits could make appointments 24/7,
meet with our corporate physicians on the appointment day/time
to receive medical consultancy services and have prescriptions/
medication reports written, and obtain prescribed medicines
from contracted pharmacies only with their register/TCKN. The
contactless pass (card acceptance) system developed for public
transportation was implemented in various provinces of Türkiye.
Efforts are underway to enrich the digital learning content offered
through the Bank's digital learning platform, Learning World, with a
view to equal opportunity in education.
In 2023, gold and foreign currency trading, bill payment, balance
loading to Istanbul Cards, and payment via NFC functions were
added to Nays, our next-generation banking application. Nays, to
which anyone can register easily and free of charge, aims to increase
financial inclusion in our country and reach the masses, especially
young people, who look for an innovative experience in their daily
financial transactions.
İşbank has realized a first in the Turkish banking sector with the
Digital Card by bringing all the features of a physical card to entirely
mobile payment and digital usage supporting its sustainability
approach. In credit card applications, customers were offered the full
experience and privileges of a physical card by opting for digital use
instead of physical printing of the card.
e-Pay Kolay is a product that allows real person merchant customers
to credit their purchases on B2B platforms with Instant Commercial
Loan.
With the Digital Letter of Guarantee, customers were able to send
temporary electronic letters of guarantee within the scope of
the Public Procurement Law (PPL), as well as electronic letters
of guarantee whose addressees are specific private companies,
directly to the addressee via İşCep, at attractive prices, in a short time,
without leaving their location.
The Always-on Finance product, being integrated with a number of
applications and panels that SMEs frequently use to manage their
daily business (ERP and pre-accounting applications, marketplace
and payment institution panels, operational solution providers, etc.),
will offer embedded financing solutions (loan products tailored to
their needs) to companies through these platforms, whenever and
wherever they need. The application, which will initially be available
only to real person merchants, is planned to be made available to
legal entity commercial customers in the second quarter of 2024.
Within the scope of realizing one of the first examples of service
model banking in our country, USD 50 million was invested in Getir
Teknolojik Hizmetler A.Ş., a subsidiary of Getir, one of the unicorn
initiatives of our country, and service model banking integration
works to be offered under the "GetirFinans" brand were initiated.
In 2024, the aim is to adapt digital workspace components and
technological innovations to business life to strengthen the next-
generation working methodologies; thus, the plan is to increase
teamwork during remote working, make communication within the
team more effective, and to support the phenomenon of working
together with technology.
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İşbank's mobile application, facilitates the experience of both retail
and commercial customers with a rich transaction set consisting of
more than 700 functions.
İşCep continues to be dynamically developed to meet the needs and
expectations of customers.
Accordingly, in 2023:
Under the "Super Application İşCep" strategy, the "My Life
with İşCep" platform was added to İşCep, providing customers
with My Home, My Family, My Vehicle, and My Travel living spaces.
The mini-apps Abonesepeti, which enables our customers to keep
track of their digital subscriptions, and Araç Değerleme, which
enables them to learn the current market values of their vehicles,
were launched in the My Home and My Vehicle ecosystems.
Within the scope of the "İşCep for Everyone" strategy, efforts
continued to offer front-end and services tailored to customer
profiles through hyper-personalization according to customer
behaviors and expectations.
o enable our customers to access all banking products and
services quickly and easily and to carry out their transactions with
a smooth experience, we continued to add new functions to İşCep
and to renew the front-ends according to changing and evolving
design standards.
The İşCep login page and the main page after login were updated
to ensure fast and simple transactions. The repeat transaction
function was introduced to improve the experience of renewed
money transfer transactions.
Automatic renewal orders for Anadolu Sigorta policies and home
insurance coverage increase options were introduced for our
customers who are shown an offer via Drawer.
Within the scope of our sustainability efforts, Carbon footprints of
customers began to be calculated on the basis of card and account
categories with the "Karbonsayar" application.
With the Digital Slip application, slips of credit card transactions can
now be viewed on İşCep.
Foreign trade transfer transactions were added.
Within the scope of İSPARK cooperation, the occupancy rate and
price tariffs of parking lots in Istanbul started to be displayed on
İşCep.
Customers with automatic limit increase instructions were provided
with legal notifications within the scope of the İşCep Ready Limit
application, and their limits were increased. Customers without
automatic limit increase orders were able to be contacted via İşCep
and offered a limit increase.
With the Pre-Approved Card service, our İşbank customers who do
not have a credit card were offered a ready-made credit card via
İşCep.
İşCep in Figures
13,700,188
users
5 million
daily users
25%
Increase in time spent per
session compared to the
previous year
25%
The ratio of investment transactions made
through İşCep to the total number of investment
transactions made through mobile banking
applications across the sector
80%
Ratio of transactions made through
İşCep to the total number of
transactions
"World's Best Mobile Banking Application" award
to İşCep
Launched as Türkiye's first mobile banking application, İşCep
received the "World's Best Mobile Banking Application" award
at the "Best Digital Bank Awards" organized by the international
finance publication Global Finance.
Maximum Family
Maximum Mobile application serves our customers with self-service
card products and services, digital payment experiences, campaign
participation, my earnings, and pazarama e-commerce and online
shopping value propositions. In 2023, efforts continued on improving
customer experience and satisfaction in our Maximum Mobile
application with the perspective of an ideal customer experience. As
of year-end 2023, the total number of customers who downloaded
the Maximum Mobile application was 12.1 million, an increase of
17% compared to year-end 2022.
Launched in 2021 within the Maximum Mobile application with the
vision of bringing an innovative and different understanding for all
stakeholders in e-commerce, Pazarama enables customers to
access payment and financing opportunities that facilitate these
transactions while purchasing products and services without the
need for another application.
The Maximum İşyerim application serves our customers with value
propositions consisting of commercial card products and services,
digital payment receiving and sending experiences, campaign
participation and insights provided to merchants through ready-
made reports. In 2023, work continued on improving customer
experience and satisfaction in our Maximum İşyerim application with
the perspective of an ideal customer experience. As of year-end
2023, the total number of customers who downloaded the Maximum
İşyerim application was 412,845 with an increase of 24%
compared to year-end 2022.
Proemtia
Launched in 2023 to contribute to the development and
digitalization of industrial commodity trade, Proemtia is the
first digital marketplace platform in its field in Türkiye. Proemtia,
which has been primarily used for iron and steel industry
products, will expand its field of activity and volume to include
other industrial products in the future.
In digital banking, İşbank's personal banking assistant Maxi, which
works with artificial intelligence and natural language processing
(NLP) technologies, offers a one-to-one dialogue experience through
İşCep and Maximum Mobile applications to serve users 24/7 in
times of need and allows customers to make their transactions by
talking or texting. With the IVR integration work, Maxi informs all
users contacting the Call Center quickly and directs them to the
relevant menus. In addition, it instantly meets the refund requests
of customers whose money is withheld at ATMs, performs the
transactions of customers who want to report lost and stolen cards,
and receives confirmation of transactions by making customer calls.
In 2023, external calls for card campaigns also started to be made via
Maxi.
The number of Maxi users reached 10.7 million in 2023. Customers
had 87.3 million conversations via Maxi with an increase of 27.9%
compared to 2022. The ability to make MTV payments was also
added to Maxi transaction capabilities. In addition, İşCep began
providing personalized reminders and notifications on the homepage,
as well as campaigns and product offers.
"Best Chatbot Technology" Award for Maxi
Application
İşbank won the "Best Chatbot Technology" award at the MarTech
Technology Awards for its Maxi application.
Nays
Launched in 2022 for the masses who prefer simplicity and ease
in banking services, actively use digital platforms, and are sensitive
to easy and advantageous access to financial services, the next-
generation banking application Nays facilitates access to basic
banking products and services for all segments of our country with
its fun and gamified experience, simple function set, communication
tone that differs from banking jargon, and the earning opportunities it
offers.
In 2023, within the activities carried out for the implementation
of Nays, collaborations were initiated with the brands that have a
widespread sales network in the ecosystem and are most preferred
by consumers. Accordingly, the Bank partnered with brands' loyalty
programs and offered advantageous and easy payment options with
a digital prepaid card with a common logo. In the coming period, the
Bank aims to increase the number of partnerships in the ecosystem,
add new banking products to the application, expand the Nays-
branded physical prepaid card product, and add investment features
with a gamification experience.
NAYS in Figures
3 million
users
1.1million
financial transactions
performed by
individual users
276,000
The number of customers brought into
the Bank to date through the app
1.143 billion
shopping volume with Nays
branded digital prepaid cards
Gold Award for Nays App: The NAYS application won a Gold award
in the "New Products and Services/Financial Services" category at
the Stevie International Business Awards.
Open Banking
Within the scope of open banking, which is managed with the vision
of “banking anywhere”, 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. To
date, 47 APIs were developed and 249 different integrations were
realized through these APIs within this scope. The volume of financial
transactions through APIs amounted to TL 152.3 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 other bank accounts
included in the system are displayed in a consolidated manner on our
İşCep and Internet Branch channels, and payment transactions can
be initiated from these accounts.
The Bank channels are the most preferred primary channel in the
open banking ecosystem for commercial customers. In 2023,
the number of customers who added other bank accounts to the
Bank's channels was approximately 155 thousand, and the number
of accounts added was 252 thousand. The number of payment
transactions initiated through bank channels using other bank
accounts was 64 thousand, with a volume of approximately TL 550
million.
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Reliable Financial ActorLooking Into the FutureAn Overview of İşbankHow We Create ValueResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report 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.
Planned to be launched in 2024, the Instant Vehicle Loan product
aims to enable end-to-end application and disbursement through the
digital channel and to extend this process to dealers in the following
period.
Digitalization in Branch Operations
To reduce counter transactions at branches, expansion efforts of TCR
machines, which were launched in 3 branches as a pilot in 2022,
where customers will receive self-service with the same structure and
architecture as the counters, continued. 1 TCR machine reduces 30%
of the branch counter load and, thanks to its high limits, performs 2
times the transaction amount of 1 ATM on average. In 2024, efforts to
expand the use of TCR machines will continue.
Within the scope of improving in-branch transaction approval
processes, customer waiting times were reduced by 28 thousand
hours in total annually, and 1.7 million fewer information slips were
printed.
Centralization of branch calls was initiated as a pilot project in 97
branches, and the rate of unanswered calls decreased from 47% to
17% for operator calls and from 44% to 32% for total calls.
The number of İşbank branches renovated as part of digital
transformation reached 580 as of year-end 2023.
Innovation and
Entrepreneurship
In order to correctly predict the strategic moves capable of changing
competition in the digital world where technology is progressing
rapidly and take the necessary actions, İşbank continues its initiatives
for developing the technology and business models aligned with the
new competitive conditions. Adopting the open innovation approach,
the Bank utilizes ideas and technologies which are developed by
organizations such as technology companies and universities for
various initiatives including development of new products and
services.
Innovation at İşbank
In 2023 innovation efforts, the Bank followed new technologies
through its innovation centers in the USA, China, and Türkiye and
continued proof-of-concept studies for innovative business models
that had the potential to impact the future on a global scale. Within
the scope of our strategy to make İşCep a super-app, innovation
projects to enrich our digital business partnership ecosystem, which
includes third-party mini-applications, were completed.
For crypto asset custody services, proof-of-concept studies to
comply with the regulations expected to be issued by official
authorities, particularly the Capital Markets Board, were completed.
In the upcoming period in the field of innovation, we aim to offer the
most appropriate value propositions for our customers' financial
journeys and life stages with real-time, contextual, and proactive
interactions through the use of artificial intelligence technologies in
different branches, especially generative artificial intelligence, and
to provide hyper-personalization in our digital channels. Within the
framework of our Web 3.0 vision, efforts will continue with a focus on
continuously developing competencies in blockchain technologies
through experimental studies and creating beyond-banking products
and services that will enable the digital asset ecosystem to become
established through tokenization and smart contract structures.
In 2023, the budget allocated to R&D and innovation at İşbank is TL
381 million.
Paperless Banking
In the Field of Contracted Merchants:
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,
238 million pages of paper were saved in 2023 with an increase of
25% with respect to 2022.
Based on an agreement entered into with the TEMA Foundation,
İşbank undertakes to plant one sapling for every 100 kg of paper
donated. The Bank donated a total of 567,014 kg of waste paper
between March 2020-March 2023, and planted 5,670 saplings.
Developments in Payment Systems
With the perspective of “banking anywhere”, projects and practices
to address our customers daily needs are deployed digitally and/or
physically through business partnerships in different sectors.
In the Card Applications Area:
In 2023, the "Digital Card Experience", which encompasses every
step of the card experience, from the Card application processes to
using the card for shopping, to withdrawing and depositing money
in our ATMs and card payment, was offered to our customers fully
digitally via mobile phone without the need for a physical plastic
card. The fact that contactless payments, which until now could
only be made for cash purchases in the sector, can now be made
for installment purchases or points without the presence of a plastic
card is a first for the sector as well.
Pay by Link, which transforms the mobile phone into a POS and
has been available through the Maximum İşyerim application since
2019, was also added to the "İşCep" channel in 2023.
In order to allocate physical POS to payment institutions, an API was
designed to offer to requesting companies, and the first integration
in this field was realized with Paycell.
İşbank software was prepared for Paygo brand Android POS
devices and pilot work started in approximately 100 workplaces.
The MOKA Super Physical POS product of our subsidiary MOKA
Ödeme ve Elektronik Para Kuruluşu A.Ş. (MOKA), which enables
cash and installment transactions from different bank cards without
going from bank to bank through a single physical POS device by
entering into a single merchant agreement with MOKA, was made
available to small and medium-sized legal entities and real person
merchants.
We added features such as sale with installments and points
and allowing employees to receive payments to our POS'um
Cepte product, which allows our member merchants to receive
contactless payments via their smartphones or tablets with Android
operating systems.
In order to digitalize the physically produced documents, also called
slips, used for cardholder and merchant copies in card purchases,
our Digital Slip application was launched, enabling our cardholder
and merchant customers to access these documents through our
digital channels and branches when needed.
Samsung and Pazarama Wallet business models were launched in
Implemented in 7 provinces in 2022, the contactless pass
cooperation with our subsidiary MOKA.
In order for our customers operating in agricultural regions to easily
obtain an İmece Card, end-to-end İmece Card allocation was made
possible through İşCep.
The cashback competency, which enables our customers to
receive discounts on their campaign-based expenditures in certain
sectors, was extended to our debit cards.
The "Kazançlarım (My Earnings)" menu was added to İşCep, where
customers can track the MaxiPoints, MaxiMiles, and cashback
amounts they earn from their spending based on their cards.
The Visa Token Service application for digital platform subscription
payments was launched. In addition, a separate menu was added
to İşCep to enable customers to view their subscriptions.
Functions such as balance loading to İstanbulkart, bill payment,
gold and foreign currency purchase/sale transactions, and
contactless payment with NFC technology were introduced.
application in public transportation vehicles was expanded to
25 provinces in 2023, and the necessary work was initiated
to add Istanbul to the contactless card acceptance network in
transportation.
Digital Loan Developments
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.
The use of the paperless banking applications "Instant Credit",
"Instant Shopping Credit" and "Instant Limit", where all processes can
be completed through digital channels such as İşCep, Internet Branch
and the Pay with İşbank application, which can be accessed through
contracted shopping sites, was expanded.
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Artificial intelligence applications at İşbank are managed with the aim
of maximizing customer experience, automating processes with low
added value, and directing employees to areas where they can create
higher value. At the Bank, artificial intelligence activities are carried out
under the umbrella of the Artificial Intelligence Division, and an "agile
working model" is applied.
The Bank complies with legal requirements and ethical rules in the
development and use of artificial intelligence models. It is of great
importance that customers' personal data protection law consent is
obtained in the training and use of the models. Models are validated
by the Risk Management Division during their development and
subsequent implementation.
"Artificial Intelligence Ethical Manifesto" was published
Our Bank's
to ensure compliance with ethical values in the application process of
the models.
The Artificial Intelligence Ethical Principles under the Ethical
Manifesto, to which İşbank is committed, are a fundamental guideline
for the proper and ethical management of artificial intelligence
In the upcoming period, we aim to offer the most appropriate value
propositions for our customers' financial journeys and life stages with
real-time, contextual, and proactive interactions through the use of
artificial intelligence technologies in different branches, especially
generative artificial intelligence, and to provide hyper-personalization
in digital channels. In addition, with the integration of generative
artificial intelligence and the big language model to be developed,
Maxi will be provided with new competencies and will be able to
interact with customers with smarter, contextual, and humanoid
dialogues in the scenarios to be realized.
Support for Entrepreneurship
In line with its vision of being the bank of entrepreneurship and
startups, İşbank has been supporting the entrepreneurship
ecosystem since 2017, both through new programs, formations, and
collaborations and from an investor perspective.
Within the scope of 2023 entrepreneurship support efforts:
For the first time in the world, the Maximiles Business Startup Credit
Card, which provides free access to Amazon Web Services (AWS)
cloud credit with a banking product connection, has been made
available to entrepreneurs.
Click here for İşbank Artificial Intelligence Ethical Principles
The Ankara Entrepreneurship Branch, which was opened in
technologies.
In each of the development, training, and performance evaluation
stages of the models,
whether the conceptual setup of the model is in line with legislation,
regulations, and good practices in the sector,
compliance with personal data protection law and ethical values for
the areas of input,
the nature of demographic data,
and compliance of model outputs with ethical values
are questioned and recorded with relevant documents.
In 2023, investment was made in artificial intelligence and innovation
through Softtech with a capacity of over 4,500 person-days.
Machine learning operations (MLOps) are used for Artificial
Intelligence to operate on a large scale, sustainably, and continuously
learning. In parallel with the significant developments in generative
artificial intelligence (GenAI) and large language models (LLM), the
Bank started to develop its own large language model (İşGPT) in
2023 and made the necessary infrastructure investments. İşGPT
reached 91% accuracy in answering questions from a specific
context as of year-end 2023. İşGPT, which operates in the Bank's
data center, is to be used in many scenarios, especially for virtual
assistants specialized in different subjects.
As of year-end 2023, artificial intelligence investments amounted to
TL 25.3 million.
October, was added to our Entrepreneurship Branches serving
ecosystem stakeholders, especially entrepreneurs, in Istanbul and
Izmir.
Four different entrepreneurship programs were carried out
with Workup vertical independently, Workup Agri focusing on
agriculture and sustainability, Workup Gaming related to the gaming
ecosystem, and Workup4Future in the impact entrepreneurship.
Workup Rise, our first overseas accelerator program designed to
support the global expansion of entrepreneurs in our ecosystem
and expand their overseas investment networks, was launched in
London with the support of KOSGEB.
The Workup İş Tower area, which entrepreneurs can use as a co-
working space in the İş Towers area, has been opened for use.
In addition to supporting the Turkish Entrepreneurship Foundation
and the TÜSİAD “Bu Gençlikte İş Var” Program to help young
people become more involved in the entrepreneurship ecosystem,
a cooperation was initiated with the Endeavor Türkiye Association,
which provides entrepreneurs with an international business
development, investment, and mentoring network with offices in
nearly 40 countries.
The Bank became a member of the Endeavor Foundation, a global
entrepreneurship network that contributes to the development of
entrepreneurship in Türkiye.
USD 7.3 million was invested in 11 startups through the Maxis
Innovative Venture Capital Investment Fund, of which İşbank is the
main investor.
The number of funds investing in startups was increased to 4 with
the 100th Year Venture Capital fund we launched during the year
in addition to Maxis, Founder One, and Arya, and our investment
commitment in the funds reached USD 50 million. Through the
funds, 63 investments totaling USD 17.4 million were realized.
A venture capital investment of USD 50 million was made in
startups to date.
GetirFinans as part of our strategic partnership on the service
model banking axis.
TekCep and TekPOS, the products of our subsidiary Softtech,
were acquired by Figopara in exchange for shares, and with this
acquisition, a strategic cooperation was established in the fintech
ecosystem.
“The Bank of the Year Supporting Entrepreneurship
the Most” Award to İşbank
İşbank received the "Bank of the Year Supporting Entrepreneurship
the Most" award at the StartupCentrum Entrepreneurship Ecosystem
2022 Awards.
Intrapreneurship Program
Within the scope of the “Internal Entrepreneurship Program”
launched to contribute to İşbank's innovative and entrepreneurial
culture transformation and to develop new business ideas and
models, employees gain next-generation competencies such as
entrepreneurship, teamwork, and continuous learning/development
and have the opportunity to create ideas, discover problems, mature
solutions, and launch products. Entrepreneurship teams consisting
of employees receive training and mentoring support from program
partners experienced in entrepreneurship, as well as information
on innovative business models, entrepreneurship, and internal
entrepreneurship.
Following the 2023 earthquake disaster centered in Kahramanmaraş
and affecting many provinces, a "Disaster-Focused Idea
Workshop" was held under the Internal Entrepreneurship Program
to reduce the impact of the short-term adversities and to implement
technology-based creative and innovative ideas for the medium/long
term.
In addition, within the scope of the value proposition integrated with
Proemtia's fields of activity, Yükline, a graduate of our Bank's 2nd
Term Internal Entrepreneurship Program, will continue to work within
our subsidiary Maksmarket in 2024.
Supporting Impact Initiatives
Workup Agri and Workup4Future entrepreneurship programs are
being carried out by our Bank to support startups that produce
technology with a focus on impact and accelerate the green
economy transformation with the technologies they produce.
The initiatives included in these programs are supported to make
them visible, meet with potential customers, come together with
investors, and develop business with İşbank and group companies.
FounderOne Venture Capital Fund, which operates with the theme
of investing in impact entrepreneurship, including early stage, and is
supported by our Bank, has invested USD 2.7 million in 27 different
Workup Entrepreneurship Program
The Workup Entrepreneurship Program, with İşbank as its main
supporter and running uninterruptedly since 2017, continues its
mission to support early-stage startups with a technology-oriented,
sustainable, and scalable business model and to help them
accelerate.
Startups participating in the program come together with expert
mentors, bank subsidiaries, and ecosystem representatives for
6 months and receive multi-dimensional support ranging from
collaboration and mentorship to access to investment opportunities.
At the Demo Day event held at the end of the program, the startups
that graduate from the program share their business models and
road maps and have the opportunity to meet one-on-one with
stakeholders in the ecosystem. In 2023, the 11th term of the Workup
Entrepreneurship Program was completed and 5 startups graduated.
In the Workup Agri Entrepreneurship Program, which was launched to
support digitalization and sustainability-focused agricultural initiatives
in agriculture and related topics and add new collaborations to our
agriculture value proposition, trainings, mentorship support, and
collaboration opportunities are offered to agricultural entrepreneurs.
In 2023, the 2nd term of the Program was completed and 3 startups
graduated.
In 2023, the Workup Gaming program, which aims to accelerate
education-focused game technologies, was launched as a new
vertical and completed with Demo Day, where 10 startups graduated.
Within the scope of the program, 7 startups presented their new
games to users, while 3 startups with educational games achieved a
50% improvement in their metrics. In addition, 4 startups participating
in the program received an investment of USD 1.1 million during this
period.
Workup Rise, our first overseas accelerator program designed to
support the global expansion of entrepreneurs in our ecosystem and
expand their overseas investment networks, was launched in London.
The program, which was realized with the support of KOSGEB
and in cooperation with Ankara TEKMER & Leap Investment, was
completed with the participation of 9 startups. Within the 2-month
program, the startups conducted 23 proof-of-concept studies and 3
sales.
At the end of 2023, the first term of Workup4Future, our accelerator
program launched specifically for impact startups, continues with
7 startups. The aim of the program is to ensure the rapid scaling of
startups in the social impact and natural disaster verticals with the
support of expanding their collaboration and investment networks.
To date, 174 startups out of over 16 thousand applicants have been
accepted to Workup programs in 5 different verticals and 119 of them
have graduated. 58 Workup startups have received USD 23 million in
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Reliable Financial ActorLooking Into the FutureAn Overview of İşbankHow We Create ValueResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report investments to date.
Golden Sardis Award for Entrepreneurship Programs
Workup, Workup Agri, and Workup Gaming Entrepreneurship
Programs won the Golden Sardis award in the "Most Innovative
Accelerator and Incubator Programs" category at the Sardis
Awards.
Arya Women Investment Platform
Since 2018, İşbank has been the main sponsor of the Arya Women
Investment Platform, one of the first women-focused investment
platforms in Türkiye, which supports women entrepreneurs through
training, events, accelerator programs, mentoring, consultancy, and
investment.
Within the scope of the Arya Investment Readiness Accelerator
Program under the platform, women entrepreneurs go through a
5-week training and mentorship and prepare to meet investors. At
the semi-final event of the program, the entrepreneurs in the program
deliver their investor presentations and graduate from the program.
In the final part, the Arya Retreat event, which brings the remaining
entrepreneurs together with investors and lasts for 3 days, 3 startups
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 eighth Arya Retreat
event was held in 2023 with the theme "Time to Launch: You Are
Your Own Venture!".
Arya Venture Capital Fund
Arya Women Investment Platform and İşbank collaborated to
establish the "Arya Venture Capital Fund” in 2022, aiming to reach
a minimum size of USD 10 million to invest in initiatives that observe
gender balance and offer sustainable return potential. The fund aims
to be a venture capital fund that creates regional impact. With this
fund, USD 2.4 million was invested in 10 startups in 2023.
WeLead (Leading Women Entrepreneurship for
Accelerating Development)
Launched in 2021 under the management of the Turkish Enterprise
and Business Confederation (TÜRKONFED), in cooperation with
İşbank, and with the support of UN Women Regional Office for
Europe and Central Asia, the "WeLead" project provides face-to-
face and online training support to entrepreneur women working in
different regions of Türkiye, regardless of sector and scale, to improve
their capacities and strengthen their communication networks.
Silver Sardis Award for WeLead
In 2023, İşbank received the Silver Sardis Award in the "Positive
Social Impact - Gender Equality" category of the Sardis Awards for
WeLead.
Training content is based on two pillars: ‘gender equality awareness’
and ‘technical capacity building’. The content of the trainings under
the heading of ‘Developing technical capacity’ was determined in line
with the needs identified as a result of the research report prepared
within the project.
In 2023, a total of 23 training programs were organized in areas such
as Marketing, Business Development and Lean Entrepreneurship,
Personal Data Protection Law, Procurement, Digital Transformation,
Labor Law, etc. A total of 5,043 women were reached in 2022 and
2023. Business development support will be provided by Türkiye İş
Bankası to 28 women who successfully complete this process, while
3 entrepreneur women will be awarded a visit to the US Silicon Valley.
In addition, 40 entrepreneur women selected among the women
who were eligible for mentoring support and who completed the
trainings on the WeLead portal were provided with a maximum of TL
100,000 and a total of TL 3 million in unsecured and zero-interest
loan support, with Applied Value Group (AVG) as the guarantor and
İşbank as the financier. By the end of 2023, a total of 5,043 women
had received training through the "WeLead" project.
In addition to the trainings, women's meetings were organized to
support entrepreneur women's cooperation and networking. Within
the scope of the project, a total of 4 women's meetings and 6 field
trainings were organized.
Women Entrepreneurship Loan
İşbank offers financing support for all the business needs of
tradeswomen who want to grow their business, to companies with
51% of their shares 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. As of
year-end 2023, a total of TL 34,945,331,827 in financial support was
provided to female entrepreneur customers.
In 2023, İşbank published the "Women's Empowerment Declaration"
and committed to providing TL 100 billion in financial support to
women entrepreneurs within 5 years through programs for women
entrepreneurs, micro-loans extended to women, and financing
of companies where women have a say in employment and
management.
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.
- With Insured Profitability Model machine learning methods, models
have been developed to calculate profitability at the insurance level
and to predict the profitability class of new customers.
- In the Spare Parts Purchasing Model, in order to minimize both
the effect of the exchange rate increase on the automobile parts
purchased especially in foreign currency and the difficulties in
finding parts, guiding outputs were obtained through annual
portfolio evaluation (in bulk purchasing/negotiation processes)
by estimating the maximum and minimum usage times of parts
throughout the year.
ό Millî Reasürans
RPA (Robotic Process Automation) efforts, which were initiated to
automate company processes and operations, were accelerated and
started to meet the needs of different services, resulting in significant
gains in employee satisfaction and increased company efficiency.
ό Anadolu Hayat Emeklilik
The infrastructure of Credit Life and Credit Support Insurance
products was renewed, and the new screens were made available
to all İşbank branches.
The "AHE-Digital PPS Application" practice was launched,
allowing printed forms with written approval from customers to be
completed through digital platforms without the use of paper.
The "Customized Future Planning" service was launched, allowing
customers to easily calculate the savings they need for their future
plans in line with their assets, income and spending levels, and
savings habits and to choose from a range of customized product
offerings.
ό İşbank AG
The Bank's website and mobile app were renewed. Digital archive
was launched, Target-2 transition was completed, Jira process
software was put into service, and Power BI Management reporting
system was installed.
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.
Sponsorships for Young Entrepreneur Programs
İşbank is the supporter of the Turkish Entrepreneurship Foundation
(GİRVAK) and TÜSİAD “Bu Gençlikte İş Var” Program, which carry out
important activities 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, which 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., aims to
invest in early-stage impact startups.
Prominent R&D Activities at İşbank Subsidiaries
ό Anadolu Sigorta
- By developing a machine learning model, social network analysis
model, and rule engine on the Sobe Fraud Detection Platform,
claims prone to fraud were identified and cost savings were
achieved in claim payments.
- With the customer lifetime value housing and health project, the
future income and expenses of the customer were predicted
and customer's returns in the medium and long term were
calculated. Within the scope of this study, models such as churn,
investment income calculation, calculation of customer retention
and acquisition costs, and cross-product sales forecasting were
developed with machine learning methods.
- Thanks to the AS Insured Auto and Non-Auto - AS Insured Damage
Detection from Images with Artificial Intelligence project, models
were developed with deep learning and machine learning methods
on all auto-related insurance issues and achieved great success.
- As part of university-industry cooperation, technical consultancy
was obtained from Muğla Sıtkı Koçman University within the
scope of the Claim Files Legalization Prediction Model project,
and classification models were developed with machine learning
methods for the automobile insurance and traffic branches.
- With the Analysis of Insurance Policies with Artificial Intelligence
and Development of Policy Comparison Software project, object
detection models were developed in policy making processes and
certain parts of the documents were compared.
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The Company's ongoing technological renewal and digital
transformation efforts have been identified as a strategic priority.
Within this scope, the Company aims to renew the main factoring
software, create channels that offer a digital customer experience,
and provide effective reporting through a data analytics platform.
A digital supplier financing system was purchased to enable
customers and their commercial partners to come together easily
in the digital environment and quickly meet their financing needs
in a smooth-running environment. Through this system, our
customers are expected to experience full digitalization processes,
including the approval of contracts and transaction documents
electronically in 2024.
The "Establishment of Contractual Relationship in Electronic
Environment" project, which will enable customers to sign contracts
and transaction documents securely in an electronic environment,
is ongoing.
In 2023, work was carried out to quickly finalize financial data
or trial balance analyses in our Company's credit allocation and
monitoring activities and to provide the infrastructure for e-ledger
integration.
The renewal of our human resources software is also among our
projects.
ό Bayek
Bayındır Academy has been launched to transfer trainings to the
online platform and digitalize them.
ό Gullseye
The Company has been awarded support by TÜBİTAK as part
of the "Industry R&D Support Program" with its project titled
"Human Resources Planning, Train and Pregate Operation Planning
Optimization in Ports".
ό Livewell
The Company develops products to help diagnose Cardiovascular
Diseases (CVD), which account for more than 40% of all CVDs in
Türkiye. Among these products, the Cardiom device analyzes the
electrical signals of the heart in real time and transfers the data to the
Livewell platform when necessary, making it accessible to healthcare
professionals. In addition, as a result of the project carried out by the
Company, a completely textile-based "Smart T-shirt" that can record
and process ECG signals has been developed, and production has
started.
Information
Security
Digital transformation brings with it increasing cyber security risks.
İşbank meticulously maintains processes to ensure information
systems' security and secure storage of personal data and
confidential information, which are of great importance today. This is
achieved through consistent investments in security infrastructure as
well as training and awareness programs aimed at fostering a culture
of continuous improvement in security applications.
In 2023, approximately TL 210 million was invested in the information
security and cyber security fields.
The ultimate responsibility for ensuring information security within
İşbank lies with the Board of Directors. The Board of Directors is
responsible for creating the necessary strategy, and the Information
Security Committee is responsible for creating and implementing
policies within the scope of this strategy. All organization units of
the Bank are responsible, within the boundaries of their areas of
responsibility, for carrying out their activities in accordance with the
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.
İşbank’s information systems are annually audited by the Board
of Inspectors in a risk-based manner in accordance with the
"Regulation on External Audit Institutions’ Information Systems
and Banking Processes Audits" (BSEB) published by the Turkish
Banking Regulation and Supervision Agency (BRSA). Within the
framework of the regulations mentioned in the BSEB Regulation, the
following are evaluated: the existence, adequacy, and effectiveness
of a process that includes activities such as a risk assessment study,
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 employees 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
development.
Within the scope of audit studies for information technologies (IT),
inspections are carried out 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 considering the criticality of the applications and systems for
the Bank and their sensitivity in terms of data security. Audits are
conducted based on the BSEB Regulation and internationally
recognized best practices.
In the audit activities by the Board of Inspectors, the effectiveness of
the measures taken for the confidentiality of customer information
is reviewed. In case of a customer complaint submitted to the Bank
in relation to an confidentiality breach due to loss or disclosure of
customer information to third parties, 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 has been 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.
In 2023, 307 complaints were received alleging that customer
information was shared, and all of these complaints were responded
to.
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, the measures taken by the
relevant unit managements are monitored.
The Internal Control Division information systems internal control
activities team conducts inspections at checkpoints for the Bank’s
information security process. In addition, various checkpoints for
cyber security 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, authorization, and security parameter controls on
databases,
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,
Change records controls as part of the operation of the IT
infrastructure change process,
Controls for consultant user accounts,
Regular access and authorization controls to ensure that end-user
privileges are up to date.
The internal control environments regarding the 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.
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 service) 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.
In line with the BRSA Communiqué on "Penetration Tests for
Information Systems", since 2012, İşbank has been conducting
penetration testing at regular intervals by external firms in order to
detect and correct security vulnerabilities in the Bank's information
systems before they are exploited. Penetration test action plans
prepared 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 2023, threat modeling studies were initiated in order to
continuously assess applications or services at a satisfactory maturity
from a security and risk perspective. In addition, a Cyber Incident
Response Plan was established to address cyber incidents at the
appropriate level as soon as possible in accordance with their severity
levels and to clearly define the roles, responsibilities, and workflows
within the institution. Every year, tabletop exercises where the plan is
tested using real attack scenarios are carried out separately with the
participation of technical teams and/or senior management, and the
aim is to maintain our maturity level by repeating these with different
scenarios in the following periods.
Information security awareness training is provided and phishing tests
are done to increase awareness among Bank employees. Through
constant awareness programs, the Bank strives to increase the
knowledge of its employees and raise awareness among end users.
Targets for timely information security trainings, information security
governance and awareness activities are assigned and targeted as a
criterion in the executive performance measurement of our relevant
departments.
In 2023, 9,161 employees from the Head Office and branches
received a total of 7,746 hours of training in the fields of cyber
security, social engineering, and information security. In addition,
as part of Cyber Security Awareness Month activities, a "Malware
and Data Breach Seminar" was organized for employees in the
Information Technologies business family. Risky transactions made
by the Bank's customers through digital banking channels are also
regularly monitored, current risks and threats are evaluated, and
necessary actions are taken quickly.
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Reliable Financial ActorLooking Into the FutureAn Overview of İşbankHow We Create ValueResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Awards We Won in 2023
MarTech Awards
- Pazarlamasyon
BrandVerse Awards -
Marketing Türkiye Magazine
Global Finance World’s Best
Digital Bank Awards 2023
Stevie International
Business Awards
PayTech Awards -
FinTech Futures
CX Awards
Forrester Global
Technology Awards
Best Chatbot Technology - Maxi
SocialBrands Data Analytics
Best Use of Blockchain - “Tablo-
larla Boğaziçi’nde Bir Gezinti”
Maximum E-Commerce Campa-
ign/Blockchain Based Digital Ad
Verification Integration - Best Use
of Blockchain
1. Gold in the Banks category with İşbank,
2. 2. Silver in the Online Banking category with
İşCep,
3. 3. Bronze in the Credit Cards category with
Maximum
Jury Voting
4. Silver in the Addressable TV Usage
category of the Media main section with the
project titled İşCep/TV Ekstra Connected
TV and Mobile Marketing Measurement
Integration,
5. 2. Silver award in the Finance category of
the Media main section with the project
titled İşCep/TV Ekstra Connected TV and
Mobile Marketing Measurement Integration,
6. 3. Silver in the Serial Movies category of the
Movie main section, and
7. 4. Silver award in the Special Day Movies
category of the Movie main section with
“Senin Farkın Var - 19 Mayıs Kutlama”.
Best Consumer Mobile Banking
App - Global
Best Consumer Mobile Banking App
- Regional winner in Europe
Best Consumer Digital Bank in
Turkey
Best Consumer Digital Bank for
Online Product Offerings - country
winner in Turkey
Best Consumer Mobile Banking App
- country winner in Turkey
Best Consumer Digital Bank for
Lending - country winner in Turkey
Best Consumer Digital Bank for
Open Banking APIs - country winner
in Turkey
“Gold” award for Nays in the
“New Product & Services/
Financial Services” category;
Geleceğe Orman (Forest for the
Future) “Silver” award in the
“Achievement in Environment,
Social, and Government”
category.
Best Mobile Payments
for Consumers
Initiative - Nays
“Good Idea Award”
in the “Sustainability in
Customer Experience”
category in the
"Banking" sector at CX
Awards Türkiye.
İşbank ranked first in the
Technology Strategy
Impact category in the
EMEA region
Brandon Hall Group HCR
Excellence Awards - Human
Capital Management Spring
Programme
Altın Örümcek
Web Awards
Talent Management Best
Advance in Employee
Engagement Altın
Human Resources Best
Advance in Workforce
Planning and Management
Bronz
Future Of Work Best Advance
in Managing a Remote
Workforce Bronz ödül
Mobile Application - İşCep
2nd place,
Maximum 3rd place in the
Digital Marketing - Integrated
Campaign category
Nays Website 3rd place in the
Banking-Finance category
The ONE Awards - Marketing
Türkiye ve Akademetre
Research & Strategic Campany
StartupCentrum
Entrepreneurship Ecosystem
2022 Awards
Marketing Türkiye B2B
Excellence Awards
Brand Finance Banking 500
The Banker - Top 1000
Bank 2022 Ranking
Strong Bosses -
TÜRKİYE LEADING BRAND
AWARDS 2023
Euromoney Cash
Management Survey 2023
Türkiye Customer
Experience Awards
Our Bank ranked in the top 3 in
the Online Banking category.
A program for Entrepreneurship
Ecosystem stakeholders
- The Bank of the Year Supporting
Entrepreneurship the Most
Award in the bank category at
the B2B Excellence Awards,
“Türkiye's Most Reputable
Business Partners” organized
in cooperation with Marketing
Türkiye and Kuantum Araştırma,
with Deloitte Türkiye also
contributing to the process.
Award in the bank category at
the B2B Excellence Awards,
“Türkiye's Most Reputable
Business Partners” organized
in cooperation with Marketing
Türkiye and Kuantum Araştırma,
with Deloitte Türkiye also
contributing to the process
167th in the global ranking
and 2nd in the national ranking
according to Tier 1 Capital size.
The Banker "Best Performing
Bank" 3rd place
Digital Banking of the Year Award
"Market Leader" and "Best
Service Provider" in the "High
Technology Production" category,
"Best Service Provider" in the
"Consumer" category
Best Customer Service
– Dataroid&Digital Swat
Team(Finalist)
Best CSR Initiative –
Geleceğe Orman(Finalist)
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Operations
108
116
Reducing Negative
Impacts of
Operations
Decent Work
We Reduce
Negative Impacts of
Our Operations
As one of the largest banks in Türkiye, İşbank offers
services to millions of users. The Bank aims to minimize the
environmental impact of managing its widespread network
of operations, to ensure its suppliers embrace identical
working norms, and to be a reliable employer for all its
employees.
Risks
Increase in operational expenses with rising energy costs
Operational disruptions due to the physical impacts of climate change
Penalties and sanctions that may be imposed due to environmental non-
compliance
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
Relevant Stakeholders
Material Topics
Employees
Business Partners
Suppliers
Climate Action
Responsible
Purchasing and Supply
Chain
Opportunities
Contributed SDGs
Capital Elements
Reducing operational expenses and observing resource efficiency with
energy efficiency, reduction of water consumption, and paperless banking
practices
Positive reputational benefits of successful results obtained in research and
rating studies assessing environmental and social impact
Realizing cooperation that will provide efficiency with effective supply chain
management
Social-Relational
Capital
Natural
Capital
Key Performance Indicators
GHG Emissions1 (ton CO2e)
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
Total Energy Consumption (GJ)
Total Energy Consumption (MWh)
Total Electricity Consumption (MWh)2
Total Natural Gas Consumption (m3)
Fuel Oil Consumption (l)
Coal Consumption (kg)
Diesel Consumption (l)
Total Water Consumption (m3)
City Water
Rainwater (recovered/re-used water)
Drinking Water3 (tanker water + bottled water)
Total Amount of Wastewater
Vehicle Fuel Consumption (l)
2021
2022
2023
22,528
8,784
6,458
31,312
1.40
0.03
0.36
2.00
26.33
13.09
22,119
01
10,846
22,119
0.95
0.01
0.24
0.32
5.97
18,333
01
10,803
18,333
0.87
0.01
0.18
0.21
6.25
18.65
29.44
630,216
175.060
121,404
607,022
168,617
122,652
508,429
141,230
108,720
5,284,460
4,529,353
3,326,108
11,296
21,869
1,011
26,954
282,318
333,258
900
12,211
191,938
262,235
282,919
318,050
7,947
5,470
8,820
3,063
4,047
3,422
270,182
291,739
322,097
Fuel Consumption of Company Vehicles (Diesel)
3,155,927
2,659,440
1,846,268
Fuel Consumption of Company Vehicles (Gasoline)
334,694
1,344,827
2,205,462
Fuel Consumption of Employee Shuttles (Diesel)
550,100
530,861
596,531
Business Trips with Personal Vehicles (Diesel)
Business Trips with Personal Vehicles (Gasoline)
Business Trips with Personal Vehicles (LPG)
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)
Amount of Electronic Waste
Medical waste
40,352
43,731
27,035
503
1,570
1,001
12
23
2
57,855
65,546
26,014
963
1,719
1,118
6
74
3
57,329
70,440
39,218
914
1,814
1,150
21
56
3
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Key Performance Indicators
Total amount of waste recycled5 (ton)
Amount of paper waste recycled (ton)
Amount of non-hazardous waste recycled5 (ton)
Plastics
Metal
Glass
Plastics + Metal (Branch)
Amount of hazardous waste recycled5 (ton)
Batteries
Fluorescent lamps
Car batteries
Cells
Toner cartridges
Total amount of hazardous waste (Branch)
Amount of electronic waste recycled (ton)
2021
2022
2023
568
346
189
-
-
-
-
10
-
-
-
-
-
-
23
599
353
164
10
5
59
90
8
1
0.35
2
0
0.28
5
74
660
417
170
19
10
50
92
17
1
3
7
0
0
6
56
[1] Since the electricity consumption is IREC-certified, Scope 2 emissions are calculated as “0”. In 2023, the amount of energy generated from renewable
energy sources accounted for 100% of the total energy consumption
[2] 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.
[3] It covers the buildings of the General Directorate and all service buildings with ISO14001 certificate.
[4] The total amount of recycled waste consists of recycled non-haza rdous wastes, recycled hazardous wastes, paper wastes and electronic wastes, and
includes the data of the Head Office buildings.
[5] 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.
Number of Local Suppliers
Ratio of Local Suppliers* (%)
2021
3,396
97.42
Ratio of Procurement from Local Suppliers (%) 91
Total Number of Suppliers
3486
2022
3,673
94.09
87.71
3783
2023¹
2,389
94
96
2,539
* While calculating the ratios, companies registered in the trade registry and operating in Türkiye were accepted as local companies.
[1] The decrease in figures compared to the previous year is due to the update of the supplier database as a result of the change in the purchasing application
used. Suppliers with whom we do not currently work have been deleted from the database.
Targets
Targets for 2023
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)
Realization in
2023
Realization Status
79%
Completed.
Targets for 2024
and Beyond
Conducting
activities as
carbon-neutral as
of 2026, in terms of
the total of Scope-1
and Scope-2
emissions
100%
Completed.
100%
Obtaining the ISO 14001 Environmental
Management System certification for all the Bank’s
operating and service locations by the end of 2023
100%
Completed.
Including new
branches that
may be opened
in the system and
maintaining the
system.
94.8%
Continues.
100%
Zero paper consumption until 2024 through
digitalized processes
Reducing water consumption by switching to water-
saving aerators in sink faucets of branches,
Saving energy by continuing to change the lighting
fixtures to LEDs,
100%
Completed.
Continuing to replace old type air conditioners
with next-generation air conditioners with higher
efficiency
Replacement of
products during
renovations with
next-generation
products with high
energy efficiency.
Targets for 2023
Realization in 2023
Realization Status
Targets for 2024 and
Beyond
Local supplier ratio not falling
below 96%
94.1% The reason why the realization
fall short of the target is the update of
the supplier database as a result of the
change in the procurement application.
Since the suppliers we do not currently
work with were deleted from the
database, the targets also had to be
updated.
Not completed
Local supplier ratio
is targeted not to fall
below 94.1%.
The green purchasing ratio
not to fall below 3% until
2025
3%
Completed
2023 target is
maintained.
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Believing that the responsible use of natural resources and
minimising the impact on the environment in carrying out its
activities are fundamental duties of both individuals and institutions,
İşbank assumes primary responsibility for climate action in order
to continue its activities with minimal impact on the environmental.
The Bank justifies this responsibility with the targets it sets and the
commitments it makes. In addition, İşbank carries out numerous
improvement and efficiency projects to minimise the negative
environmental impact it causes.
Climate targets
As part of the fight against climate change, İşbank has defined its
climate change risk strategy and included climate change risks in its
catalogue of corporate risks.
The Bank has set itself the goal of making its activities carbon-neutral
by 2026, measured by the sum of Scope-1 and Scope-2 emissions
calculated in accordance with the International GHG Protocol. In
2023, the amount of energy generated from renewable energy
sources will account for 100% of total energy consumption.
İşbank took its place among the Global
Leaders by receiving an "A" score in
the CDP Climate Change Programme
Reporting in 2023.
İşbank has committed to validating the identified science-based
emission reduction targets as part of the Science Based Targets
Initiative (SBTi).
By going beyond these targets, the Scope-3 emissions caused by
lending activities and the supply chain were also assessed in 2023
using a target-based approach. İşbank, which is a member of the
Net-Zero Banking Alliance in order to reduce the emissions caused
by its lending activities, discloses the activities carried out in this
context under the category of "Decarbonisation Targets".
Environmental Management
Since 2018, an ISO 14001 Environmental Management System
Project has been in place at İşbank to reduce its impact on the
environment and establish an environmental management system
that meets international standards. As part of the project, 524
employees who will act as environmental officers took part in the
Environmental Management System (ISO 14001) Training and
6 employees who will carry out the internal audit of this system
took part in the Environmental Management System (ISO 14001)
Internal Auditor Training in 2023. Employees starting their careers at
İşbank receive information about the Environmental Management
(ISO 14001) System in the “Getting to Know Our Bank” course as
part of the “Starting My Career” Training. As part of the activities
to raise awareness of the Environmental Management System,
online workshops were organised to inform and raise awareness
with employees about the environmental management system.
Informative content on this topic is shared via the Bank's mobile
application. The Environmental Management System is audited
annually by the Internal Control Division. In 2023, there were no fines
for non-compliance with environmental laws and regulations.
As of 2023, all İşbank locations have ISO 14001 Environmental
Management System Certifications. Efforts are underway to
obtain zero waste certification in accordance with the Zero Waste
Legislation at the locations concerned. As of the year-end 2023,
certified locations accounted for 100% of the Bank’s total number of
locations, and efforts are made to include newly opened branches
in the certification process. Branch data is collected online via the
Sustainability Platform. İşbank intends to maintain its environmental
management system, which it has established at international
standards, in the coming years.
To support the prevention of environmental destruction and
economic losses caused by electronic waste, İşbank sells scrap and
returns toner cartridges for recycling from field devices whose life
cycle is managed by the Information Technologies Department. All
companies sold to have WEEE certificates. All recycling operations
are carried out by authorised companies in accordance with the
Bank's general rules.
As of 2023, all İşbank locations have
ISO 14001 Environmental Management
System Certifications.
Environmentally Friendly Service
Points
Environmentally friendly buildings play an important role in reducing
the negative environmental impact of İşbank's operations. The Bank's
major main buildings, such as the Head Office, operations centre
and data centre, are designed to minimise the Bank's environmental
impact. İşbank's Head Office Tower building in Levent, Istanbul, is
BREEAM In-use Excellent certified. Tuzla Technology and Operations
Centre (TUTOM) is LEED Gold certified.
The Bank's Tuzla Data Centre (Atlas) building is LEED v4 Gold
certified for Data Centers and is the first data centre in Türkiye to
meet these standards. In the Atlas Data Centre building, the data halls
where the IT cabinets are located are cooled with air and the heated
air is used to heat the office areas. In addition, rainwater is collected
via the rainwater collection channels installed in our buildings and
reused in various areas after a certain amount of treatment.
In the Head Office and TUTOM buildings, all wastes are separated
and recycled within the scope of the ISO14001 Environmental
Management System Standard.
Efficiency in Branches
Banka hizmet binalarında, çevresel etkinin düşürülmesi için kaynakların
verimli kullanımı amaçlanmaktadır. Sürekli iyileştirme anlayışıyla
verimlilik The Bank strives to use energy and resources efficiently to
reduce the environmental impact of its service buildings. Efficiency
studies are carried out with a continuous improvement approach.
There is a consumption reduction target for service buildings and the
“Sustainability Platform” software is used to monitor the consumption
of the branches that enter data.
In 2023, the Bank's renovations included modernising the lighting and
heating-cooling systems in the branches, switching to LED lighting,
replacing old air conditioners with high-efficiency air conditioners,
and switching to natural gas in branches heated by coal and diesel oil.
The replacement of air conditioners carried out as part of renovation
works and in the event of malfunctions, leads to energy savings of
30% compared to devices that work with an on/off system. The LED
conversion of the lighting fixtures in all service buildings has been
completed. With the LED conversions carried out in 2023, electricity
consumption of the lights fell by 50% and a total of 991,632.91 kWh of
electricity was saved.
The pumps in the heating, cooling and domestic water system in the
Head Office Tower 1 building were replaced with more energy-efficient
models. In the same building, the installed lighting power per floor was
reduced by 76% by replacing the existing fluorescent lighting on the
floors with LED lights. The lighting level can be adjusted as required
using the touch panels mounted on the floor. Daylight and presence
sensors installed on the floors enable adaptive adjustment of the
illumination level to changing conditions during the day. With the help of
these sensors and touch panels, lighting can be switched on regionally
during working hours and night-time cleaning, for example, and can
be switched off automatically when work is finished. When replacing
the conventional cisterns in all service buildings, models with low water
consumption were preferred and the urinals were replaced by models
with photocells. Toilet faucets are being made more economical. As
part of the ongoing renovation works in our service buildings, 33%
saving in water consumption was achieved thanks to the replaced
cisterns.
Commissioned in 2022, the use of solar panels on the roof of the
visor of the cash machine, which generates electricity from solar
energy, makes it possible to cover the energy needs of a large part
of the facade lighting. Thanks to this system, which helps to reduce
energy consumption, 82 ATMs with solar panels generated 330 Wh
per device per day by the end of 2023. In addition, İşbank carries out
the necessary official application and authorisation procedures for
the investment of a solar energy field to cover all service buildings,
especially the Head Office Buildings.
Efforts to reduce disposable plastics in branches and Head Office
buildings continue. During the reporting period, no new disposable
plastic water cups were supplied, and 0.33 l, 0.5 l and 5 l bottles were
used. The purchase of new paper cups at the Head Office building was
also discontinued, saving resources.
In 2023, 238 million pages of paper were saved through digital, digital
signature and KEP delivery applications. This represents a 25 percent
increase over the paper savings achieved in 2022.
Responsible Supply
Chain Management
Positive or negative impacts caused by institutions are not confined
to the area of their operations but may affect the entire value chain
depending on the size of the institution. Believing that sustainable
development is possible through responsible business models,
İşbank aims to spread its business approach and standards to
its supply chain as well. The Bank cooperates with its suppliers
to disseminate leading practices and products in the field of
sustainability. The Bank strives to achieve sustainable business
success with a financially strong, environmentally friendly, and reliable
supply chain with high-quality production and continuity.
Protecting the environment and using resources sustainably are
essential if the world is to be left better for future generations. In
addition, the importance attached to employee rights, human rights,
and compliance with ethical principles has a major impact on the
development of societies and countries. In this context, sustainability
criteria come to the fore when purchasing products/services in order
to contribute to the aforementioned values.
In accordance with its Sustainability Policy, İşbank seeks to minimize
the negative environmental and social impacts caused by its
suppliers and to maximize the positive effects. In this context, it
considers environmental and social criteria when selecting suppliers.
İşbank has adopted the principle of continuously improving its
employees together with its suppliers, ensuring organizational
excellence and consistently improving business processes.
In line with İşbank's approach to ethical banking, the Supplier
Code of Conduct, which is based on the UN Global Compact and
İşbank’s Human Rights and Human Resources Policy, defines the
main principles and essentials in procurement. Compliance with
these principles and policies is expected from all suppliers. Within
the framework of the Bank's Purchasing Implementation Instruction
and Purchasing Policy, the environmental impact of the products
and services to be purchased is also assessed in accordance
with the requirements of the environmental management system
when selecting suppliers from whom the Bank will purchase the
products or services it requires. In addition, measures are taken to
reduce or eliminate environmental impacts, taking into account the
requirements of national legislation and the Bank’s regulations.
The Bank seeks to collaborate with its global peers and suppliers
in order to lead the way in sustainability by benefiting from best
practices and product examples. The suppliers with whom the
Bank works have operating principles that are compatible with the
Bank's environmental and social sensitivities. Supplier are selected
in accordance with the principles set out in the Purchasing Policy
and Implementation Instructions. When selecting suppliers, the Bank
selects from its existing pool of suppliers, depending on the nature of
procurement in question, or tries to reach new alternative suppliers,
based on predefined criteria. In addition to the specified criteria, the
Bank also considers various parameters such as reference checks,
sector analysis, and financial analysis when identifying alternative
suppliers.
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Responsible OperationsLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report In addition, suppliers are regularly visited as part of a specially
designed programme. No suppliers were found to be employing child
labour or no information has been received accordingly. At the same
time, our suppliers are asked about their child labour policies in an
annual Sustainability Survey.
The Supplier Management Principles, which can be found on the
home page of the Bank’s procurement platform, detail the sensitivities
to which suppliers must adhere. These sensitivities are taken into
consideration when selecting suppliers. In procurement activities
or operations that have a high environmental impact, such as
waste water disposal or batteries sourcing, suppliers are assessed
based on their capabilities. No goods or services are procured
from suppliers who fail to submit the required documentation. For
special procurement activities, suppliers who provide the required
documentation are preferred, regardless of price.
İşbank expects its suppliers:
ੵ To act in accordance with environmental and ethical rules,
ੵ To prefer environmentally friendly raw materials and supplies with
minimal impact on the environment in procurement,
ੵ To try to minimize the environmental impact associated with their
production and logistics processes and to be open to collaboration,
ੵ To adapt to developing and changing sector conditions and to
meet quality and logistics performance expectations.
Environmental/social impacts are taken into consideration in the
selection of suppliers in current procurement processes.
ੵ In tenders for the sale of scrap, participating companies are
requested to provide 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 Interim
Storage Permit, Hazardous Waste Transport Vehicle Licences and
ISO 14001 Certificate.
ੵ High energy efficiency class air conditioners are preferred for air
conditioning needs
ੵ In the 2023 electricity purchase, renewable energy sources were
preferred for the entire electricity consumption under the Bank's
control
The Bank respects the right of association and collective bargaining.
Sensitivities on this issue are considered in the selection of suppliers.
Purchases of goods and services from suppliers found to be involved
in bribery and corruption practices will be suspended, and such
suppliers will be excluded. The supplier may not employ workers
under the age limit set by law. During the reporting period, there was
no information on negative impacts related to suppliers in terms of
human rights, working conditions, and social criteria. There were
no suppliers whose business relationship was terminated due to
negative impacts.
Every year, as part of the supplier performance management survey,
supplier assessments are carried out using questions directed to
the relevant business unit. Specialized employees working in the
Purchasing Division also evaluate suppliers using the questions
directed to them.
114
In 2023, a Sustainability Survey of 38 questions was sent to suppliers
covering 80% of procurement. The questions in this survey ask
about the existence of a policy or internal regulation to manage water
use and water-related issues, the measurement and reporting of
water consumption during the production phase, the existence of
targets to reduce water consumption, the existence of reporting on
water use, and the actions taken to reduce water use. In 2023, 48
suppliers participated in the survey, representing 59% of purchases.
The annual Sustainability Survey asks suppliers if they have a policy
on preventing/combating child labor. 46% of the 48 suppliers
surveyed for 2023 reported having such a policy. Of the 48 suppliers
surveyed, 12 have 40% female employees, and 10 have 40% and
above females in senior management. In addition, 19 suppliers have a
gender equality policy.
İşbank has adopted the principle of continuous development of
its suppliers, ensuring organisational excellence and continuous
improvement of its business processes. In 2023, the Bank continued
to contribute to the national economy by preferring local suppliers.
In line with this understanding, local suppliers accounted for 94% of
total suppliers and purchases from local suppliers accounted for 97%
of total purchases during the reporting period.
The Bank's main areas of procurement are information technologies,
service building management services, and call centers. As a new
procurement practice will be implemented in the coming period,
supplier records have been reviewed, and data on companies with
which the company has not done business for a long time have
been removed from the database. Therefore, the number of suppliers
subject to reporting has decreased.
Business Continuity
Management Program
The Business Continuity Management Program, which aims to create
an effective response capability to protect the institution’s reputation,
brand, and value-creating activities, complies with the ISO 22301
standard and legal regulations in Türkiye. The program conducts
studies that will be used as input for information system recovery
plans and strategies and monitors branch continuity. The program is
supported by training for all employees.
As part of the Business Impact Analysis studies carried out under
the Bank’s Business Continuity Management Program, all Bank
processes, including critical services, are evaluated each year in
terms of financial, reputational, customer satisfaction, legal, legislative,
contractual and operational impacts that may result from the
disruption of these processes.
As a result of the assessment, the “Criticality Level” of each process
is determined as Very High, High, Medium, and Low. Business
Continuity Plans are prepared for each Head Office Division to ensure
that, in the event of an disruption, the processes can be restored
before the expected Maximum Tolerable Period of Disruption (MTPD).
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 disruption and ensures that critical
business functions are effectively and efficiently resumed in the event
of a major disruption of the Bank’s computer and communication
resources.
The potential impact of natural disasters and extreme weather
conditions on operations is included among the extraordinary
location-based conditions that the branch/regional/general
directorate units may face in the context of the activities carried
out to ensure the continuity of the Bank’s business and services,
and among extraordinary conditions that may cause disruptions
in the continuity of the Bank’s systems. These risks are considered
in the corporate crisis management processes and, in the event of
their occurrence, all the emergency management processes to be
implemented are defined.
In the event of a disruption to branch business continuity, the aim
is to implement the appropriate business continuity improvement
strategy within one business day, except in the case of large-scale
natural disasters. The health and safety of employees is always the
Bank's first priority. In of the event of a disruption to branch services,
a recovery terminal can be defined in an alternative branch not
affected by the extraordinary situation and customer transactions can
be monitored from this alternative branch. As a result of experience
with the new working model, branch business continuity can also be
ensured through remote working if necessary.
In 2023, 12 branches experienced an extraordinary situation due
to heavy rainfall, 7 branches experienced heavy snowfall, and one
branch experienced an extraordinary situation due to water-related
risks from building infrastructure. As a result of recovery strategies, 15
of the 20 branch emergencies resulted short-term service disruption,
but these disruptions were managed without causing customer
dissatisfaction.
Corporate Crisis Management
Corporate crisis management activities are also planned under
the Business Continuity Program. Within this scope, two Crisis
Management Exercises were planned in 2023 for the Bank's senior
management and sub-teams supporting crisis management
processes. A crisis management exercise on Cyber Incident
Management was also conducted with the participation of senior
management. As part of the BSEB Regulation, Communication
Chain Tests are planned twice a year with the participation of senior
management. Efforts to support corporate crisis management
processes through exercises and drills at various levels are expected
to continue in 2024 as well.
In 2023, work was also commenced on the reassessment of Crisis
Center locations and the renovation of the Levent Crisis Center,
which is planned to be completed in 2024. In order to ensure the
continuity of our branches in the event of disruptions to the overall
communication infrastructure, evaluations of the KA-Band satellite
internet infrastructure have been initiated.
Disaster Management and Coordination
Program
Following the earthquake disaster on February 6, 2023, which deeply
affected the whole of Türkiye, especially our 11 provinces, a “Disaster
Management and Coordination Program” was implemented with
the participation of more than 50 employees to increase the Bank's
resilience and organizational strength in the face of potential disasters
that our country may face, especially the Marmara earthquake.
In the program, which we launched to become the “Most Disaster
Resilient Bank" in the second half of 2023, 7 agile teams were
established to address subjects such as:
Building and Service Area Alternatives
Disaster Logistics
Disaster Field Organization
Disaster Technologies
Business Continuity Management
Awareness and Communication
Disaster Coordination
Within the program,
ੵ A Disaster and Emergency Coordination Department was formed
with the goal of ensuring that the Bank is always disaster- ready.
ੵ To increase organizational strength, disaster management has
been divided into two major areas of focus: employee health
and safety and business continuity management. The Corporate
Crisis Management Team, which will oversee the disaster, was
expanded to allow for faster and more thorough decision-making.
At the same time, coordinators have been appointed to provide
field coordination, ensuring that necessary actions are taken
immediately in the field, and monitoring the disaster area. Within
business continuity management, Business Impact Analysis
processes were carried out in collaboration with the Divisions,
and the Divisions' critical and disaster processes as well as the
personnel who need to be backed up outside of Istanbul were
identified in terms of the sustainability of these processes. In 2024,
the identified personnel will be assigned to MaxiOfis locations, our
broad regional office network in Anatolia, notably Ankara.
ੵ The Bank's service buildings will be inspected for earthquake
resistance to ensure the safety of all buildings. In the event of an
earthquake, 20 mobile branches will quickly ensure the continuity
of critical banking activities in the disaster zone.
ੵ Gathering, living, and storage areas were designed to address the
basic needs of employees following a disaster. Within this scope,
approximately 1,700 employees can be accommodated together
with their families. Again, life support kits sufficient for 1,000
employees and their families have been supplied to address the
primary needs after a disaster.
ੵ In order to enable uninterrupted and sustainable communication
after a disaster, structured communication solutions have been
developed to gather information on the safety status of employees
and to collect their basic needs through IVR, SMS and WhatsApp
channels.
ੵ As part of awareness and communication efforts, the employees
were provided a training program designed to raise disaster
awareness and consciousness via the Learning World Platform.
All the information that employees may need for internal
communication will be consolidated and positioned within the İŞİM
application.
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İşbank offers a peaceful, safe, respectful, fair and
supportive working environment to its employees,
whom it defines as its most valuable asset. İşbank's
primary goal is to have happy and productive
employees who embrace a healthy vision of the
future.
Risks
Loss of experienced and qualified employees due to various reasons at
İşbank, which only recruits new graduates and young professionals.
Not being preferred by talented and successful new graduates and young
professionals
Decreasing employee loyalty due to the changing demands and
expectations of employees and changing work habits
Loss of workforce and reputation due to failure to meet the expectations of
existing and potential employees
Opportunities
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 especially by female employees
Keeping employee motivation high by prioritizing a work-private life balance
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 (%)
2021
2.01
13
85
98
68
55
44
29.3
30
Relevant Stakeholders
Material Topics
Employees
Unions
Employee Rights,
Loyalty and
Satisfaction
Future of Work and
New Working Models
Equal Opportunity,
Diversity, and Gender
Equality
Contributed SDGs
Capital Elements
Intellectual
Capital
Human
Capital
Hours of training per person in management and leadership development programs
16.7
Hours of training per person in IT competence development trainings
Hours of training per newly recruited employee in their first year
26.3
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2022
1.90
16
89
2023
1.63
17
86
97.5
97.2
72
55
72
53
42.6
40.29
43
25
22.1
36.1
108
56.5
30
39.5
43.8
140
Number of suggestions communicated by employees
2,950
4,702
3,894
* Training figures exclude participants of refresher trainings, while Private Security Officers and Servant Staff are not included.
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Responsible OperationsLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Employee Loyalty and Satisfaction
İşbank considers providing a satisfying work environment for
its employees to be a key responsibility and believes that the
fundamental basis of business success is employee loyalty and
satisfaction. The Bank has a deep-rooted corporate culture and
supports its employees in their needs in today's modern world.
Thanks to its deep-rooted approach to work that keeps pace with
the times, employees remain a part of the İşbank family for many
years.
Employee loyalty and satisfaction are İşbank's strengths and
the basis of its success. Employee loyalty and satisfaction are
regularly measured through surveys conducted at the Bank. The
results of these surveys, comprising the areas of training activities,
performance management, career management, recruitment
process, remuneration, and rewarding with the aim of increasing
employee satisfaction, are assessed by managers and allow for
necessary improvements to be made.
In 2023, 86% of the Bank’s employees participated in the
employee loyalty and satisfaction survey conducted with the
support of an independent firm. In this study, the loyalty rate was
measured as 67%.
Employee satisfaction practices include online tours and
workshops, cultural and arts events, special employee discounts
at various organizations, and practices to increase employee
support for volunteering. In 2023, the volunteer running team,
made up of the employees of the Bank, participated in marathons
for the benefit of various foundations and raised funds for these
foundations with the support of employees.
The fact that employees have been working at İşbank for many
years is a key indicator of employee satisfaction and loyalty.
68.81% of employees have worked for İşbank for more than 10
years. At the end of 2023, the employee turnover rate was around
1.63% and the voluntary turnover rate was 17.45%.
Targets
Targets for 2023
Realization in 2023
Realization Satatus
Targets for 2024 and Beyond
As part of the process of spreading
the agile culture and good practices
in the agile working model
throughout the Bank, role-based
development programs were
implemented in collaboration with
agile coaches to adopt the agile
culture in terms of business conduct
and human relations. Training
sessions were organized to develop
various skills specific to the field.
Individual Development Plan training,
consisting of basic, intermediate,
and advanced level video training
content that was prepared to
develop Business Development
and Innovation, Result-Oriented
Problem Solving, Continuous
Development, Customer Centricity
and Human Relations Management
competencies.
Creating new training designs
in parallel with changing needs
while continuing the role-based
training of Agile Area employees.
Providing Individual
Development Plan training
supported by various learning
tools to develop Business
Development and Innovation,
Result-Oriented Problem Solving,
Continuous Development,
Customer Centricity, and
Human Relations Management
competencies to all employees
at basic, intermediate, and
advanced levels, tailored to the
competencies that employees
need to develop.
Completed.
In 2024, the aim is to play an
active role in the development of
our Bank's working climate and
culture, focusing on the adoption
of Agile values and principles. In
this context, the plan is to continue
development journeys specific to
Agile Roles in collaboration with
our Talent Management Division.
Completed.
The plan is to provide all
employees with the development
of the Performance Management
System.
Continuation of the Data
Analytics Development Program
In 2023, 3,527 people received a
total of 36,755 hours of training
under the program.
Completed.
Data Analytics Development
Program is planned to be
continued.
Continuing to improve the digital
learning platform “Learning
World” by adding new features
to improve the user experience
aligned with good practice
examples in 2023, adding
new mini-games that support
competency development in the
“İşLegends” learning game, and
designing a multiplayer structure
within the same learning game
In 2023, the Bank's digital learning
platform, Learning World, was made
available to employees by developing
features that prioritize user
experience, such as a personalized
homepage experience and making
it possible for employees to easily
complete legal compliance trainings.
In 2023, the Bank's learning game
İşLegends was improved to include a
multi-player mode where employees
may test each other's level of
knowledge on technical banking
topics and offered to employees in
the second period of the learning
game.
Completed.
The Bank's digital learning platform
Learning World will be enhanced
with gamification features. In the
learning game İşLegends, the aim
is to establish an in-game activity
structure to enhance employee
knowledge and awareness on
topics parallel to periodically
changing needs and the Bank's
priorities.
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İşbank is committed to providing a work environment where
employees’ rights are fully protected. All the Bank employees are free
to join trade unions within the framework of freedom of association
and act of their own free will. 97.22% of the Bank’s employees are
trade union members. İşbank, which has one of the highest trade
union membership in the sector, does not carry out any activities that
may involve the risk of forced labor.
The Remuneration Policy, which is based on the Bank's internal
regulations and the provisions of the law, especially the Collective
Labor Agreement, defines all the economic and social rights of the
employees. The ultimate authority and responsibility for ensuring that
the Bank’s remuneration practices are effectively managed within
the framework of the relevant legislation and this Policy rests with
the Bank’s Board of Directors. The İşbank Remuneration Committee
is in charge of preparing decisions on remuneration to be submitted
to the Board of Directors for approval, ensuring that remuneration
is consistent with the Bank's risk appetite, ethical values, internal
balances, and strategic goals, and the Committee regularly monitors
the effectiveness of the Policy.
It is essential that the remuneration of the Bank's managers and
employees at all levels is consistent with the Bank's ethical values,
internal balances, and strategic goals and is not solely associated
with the Bank's short-term 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 discourage excessive risk taking. The
remuneration package of the Bank consists of salary, bonus, meals,
foreign language compensation, dividend payment as defined in
the Articles of Incorporation, and other fringe benefits that may
vary according to seniority and/or scope of duties. Employees may
also receive payments such as product-related sales bonuses,
performance bonuses and executive bonuses, depending on their
individual performance.
Managers and manager candidates in the branches and the Head
Office divisions receive bonus payments on an annual basis. Bonus
payments to managers are linked to performance , the Bank's long-
term strategy and the risks taken. The Bank does not have a practice
of paying variable remuneration to salaried employees.
In accordance with the Collective Labor Agreement signed
with BASİSEN (Bank-Finance and Insurance Workers Union),
all employees, regardless of position and seniority, are eligible
for healthcare benefits in line with the principles outlined in the
Healthcare Benefit Implementation Regulation. Additionally,
they have access to amenities such as food services, personnel
transportation services, and a range of other benefits and support
packages such as marriage support packages, maternity allowances,
child allowances, natural disaster support, goods transportation
allowances, death and full permanent disability insurance, bonuses,
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premiums, title compensation, and immigration allowance. Moreover,
İşbank has initiated part-time employment contracts for university
students, but since they are non-union members, they do not enjoy
the privileges outlined in the Collective Labor Agreement due to the
terms of their individual contracts.
The entitlement to special leave status of the Bank's employees
is governed by the collective labor agreement in force. Under this
agreement, employees are granted paid leave for varying periods of
time including marriage, birth, adoption, the passing or critical surgery
of a first-degree relative, their homes or possessions being affected
by natural disasters, accompanying a dependent child in the hospital,
or attending the treatment of a child with a disability or chronic illness.
On February 6, 2023, in response to the pressing housing problems
faced by our employees in Hatay, Adıyaman, Kahramanmaraş,
Malatya, and Osmaniye provinces, as well as their affiliated districts,
along with İslahiye/Gaziantep and Nurdağı/Gaziantep districts
(located within the 1st Degree Earthquake Zone) where the
devastating effects of the earthquake disaster were felt the most;
䬞 A total 59 prefabricated buildings were erected in Hatay centre,
with an additional 10 in Samandağ, and allocated to our employees.
䬞 To address the housing needs of our employees who were unable
to secure housing through our Bank and resorted to rented
accommodation, the practice of providing additional earthquake
support equivalent to 75% of their rental costs and up to a
maximum of TL 12,000 was put into practice as of September
2023.
The “Odak Sensin” project, tailored for employees, offers
complimentary consultancy services on medical, psychological,
and household needs, with services provided by Avita and
Meditopia. Furthermore, the Bank also supports employees and their
dependents in meeting their health needs with a wide range of health
benefits.
The Bank supports its employees with practices that extend beyond
their fundamental rights and freedoms:
ੵ İşbank contributes to the sportive lives of its employees by
providing access to the gym facilities located in the Head Office and
TUTOM buildings, available to all employees.
ੵ The Bank implements practices that exceed legal mandates. Annual
leave, maternity leave, disability, and unpaid leave arrangements,
as outlined in the Collective Labor Agreement, may be extended to
grant rights in favor of employees beyond legal regulations.
ੵ Additionally, the Bank facilitates the granting of administrative leave
by direct managers upon employee request for personal matters.
With the implementation of remote work practices, the employees
now have more time to deal with their personal matters.
The Future of Business and New
Working Models
İşbank has developed the Next-Generation Working Model in
response to the evolving business world where working models
evolved with the pandemic and remote working methodologies
gained importance over traditional models. This approach aims
to provide employees with greater flexible and agile working
conditions, focusing on employee satisfaction and productivity.
Since its inception in 2022, the working model offers various flexible
arrangements tailored to the nature of the work, including additional
periodic flexibilities such as the option to work from a different city
during the summer.
In 2023, employees continued their activities in a hybrid working
model, thoughtfully crafted to meet the diverse needs of business
lines; the flexibility of space provided during working hours was
embraced not only by the Head Office employees but also by
Branch employees within the framework of the Dynamics of Branch
operations.
With the introduction of remote and hybrid working into business life
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 have the opportunity
to work permanently in MaxiOfis opened outside Istanbul if their
managers find it appropriate. This made it possible to create an
alternative to the increasingly challenging living conditions in Istanbul.
In 2024, efforts are underway to solidify the working model
permanent. To this end, the Next-Generation Working Model Panel
convened with the participation of 20 employees from various roles
and positions to gather insights, demands, and expectations from
employees regarding remote and flexible working. In parallel with
the insights gained during the panel and the evaluations of our
employees, the aim is to redesign the current model to enhance
efficiency and employee experience, with the intention of making it
permanent in 2024.
Moreover, in 2024, to the aim is to integrate digital workspace
components and technological innovations into the working
environment, bolstering next-generation working methodologies.
This approach is designed to support the collaboration of employees
and technology.
To improve the employee experience and consider the demands
and needs of its employees in relation to lunch, the Company has
introduced a system whereby employees who do not use the
cafeteria are paid in cash for their lunch. In addition, a software
application has been purchased to increase employee satisfaction
and optimise the service budget for the shuttle service provided to
our employees.
To support employee satisfaction and health, the İş Tower Sports
Hall was opened in addition to the TUTOM campus for the use of
the Bank's employees and retirees, as well as the employees of
İşbank Group subsidiaries. Furthermore, group classes are offered
in 5 different areas are at both İş Tower Sports Hall and the TUTOM
Sports Hall.
Maxi Ofis
The first of the MaxiOfis spaces, designed as regional offices under
the "İŞ’im her yerde" vision with the aim of effectively managing our
Bank's human resources and providing access to the competencies
needed regardless of location, was put into operation in 2022.
Designed in line with the evolving employee expectations and
the office usage needs in alignment with the new working model,
MaxiOfis spaces offer the opportunity to work more efficiently and
happily in a spacious, bright, innovative, and social environment.
In addition to social areas such as café areas and reading corners,
allowing employees to unwind during short breaks, MaxiOfis spaces
meet the diverse needs of employees with specialised areas such as
meeting rooms, private meeting spaces, and designated audio and
silent working areas.
The MaxiOfis network aims to elevate the welfare and standard of
living of more employees by meeting the demands of our employees
who wish to be transferred to different cities through assignments to
functions such as remote service, remote sales, data analytics, and
operations, which the Head Office units wish to strategically expand.
In 2023, four new offices, one each in Ankara, Izmir, Kayseri, and
Mersin, were added to the offices that can be used by all employees
whose work is suitable for remote working, especially remote workers
and employees assigned to different cities, and a total of 12 MaxiOfis
spaces in 8 different cities were made available to employees.
The MaxiOfis, which have been visited 44 thousand times by
employees since their opening, are being gradually expanded in line
with the demands and needs of employees and as part of the of
human resources policies.
The “Disaster Management and Coordination Program” was
launched to increase the Bank's resilience to disasters and to prevent
unjust suffering by meeting the needs of employees following a
potential disaster, within the framework of new requirements arising
from the earthquake disaster on February 6, 2023 and lessons
learned from disaster processes. The 7 agile teams structured as part
of the program produced outputs in three main functions: business
continuity, field organization, and employee dimension. The Program,
which focuses on the health needs of employee, includes the design
of gathering, living, and storage areas to ensure that employees'
shelter and other basic needs are met after a potential disaster, and
the preparation of life-support kits containing the materials they
may need. Furthermore, to enable uninterrupted and sustainable
communication after a disaster, a structured communication flow
is being developed to ensure that information on the safety status
of employees can be obtained , and to be able to learn and provide
necessary information to meet their possible needs. Also, under the
program, the earthquake resistance of İşbank service buildings is
being assessed with the support of academic collaborations, and
retrofitting and relocation actions are being taken for buildings that
are considered to be at risk.
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Gender Equality
In 2023, İşbank continued its activities in a hybrid working model
that was developed in accordance with the needs of its business
lines. The flexibility of space granted during working hours was
reciprocated by both Head Office employees and Branch employees
within the scope of Branch dynamics.
Functions such as remote service, remote sales, data analytics, and
operations, which the Head Office units want to strategically expand,
were added to the scope of competency lines in order to effectively
manage human resources and provide location-independent access
to the next-generation competencies needed. With these functional
assignments, the goal is to improve the welfare and standard of living
of more employees by addressing the demands of employees who
request transfers to different cities.
Agile Workshop
Despite its huge corporate structure, İşbank has quick decision-
making processes. The “Agile Areas” established in critical areas
are an integral part of this working approach. Agile areas where
employees from various functions come together, provide quick and
innovative solutions to critical questions.
With the addition of the 5 Agile Areas in 2023, there are now a total
of 25 Agile Areas, 1,660 employees working with the agile working
model, and 225 Agile Teams.
The following results were obtained with the evaluations made in
2023.
4.20/5
Agile Maturity
1.4X
Acceleration in
Time to Market
4.35/5
Employee Satisfaction
Within the Agile Academy, a training catalogue and learning journeys
comprised of 23 modules have been designed in a structure that can
be used by external companies.
İşbank is among the institutions with the highest number of female
employees in Türkiye, with 53.18% of its employees and 40.29% of its
managers being women.
As part of the Agile Academy, development journeys have been
implemented that are designed to serve external companies.
The scope of the Agile Transformation program was met in 2023, and
it was agreed to employ the agile working model as the Bank's basic
working model. Within this scope, the Agile Management Division’s
activities were discontinued, and in order to carry out the Division’s
mission in conjunction with the main functions of the Bank, it was
decided to carry out design and agile working model activities within
the Corporate Architecture Division, as well as agile coaching and
development activities within the Human Resources Management
Division.
In 2023, various concerns were prioritized on in agile transformation
efforts. Unlike the Experience, Segment, Initiative and Platform Area
organizations, Bank-specific working models were developed for
corporate functions. Work continues with the relevant teams.
Development journeys for Area Leaders and Agile Roles
(Competency Line Leader, Product Owner, Agile Ambassador,
Team Member) were carried out in collaboration with the Talent
Management Division to spread the Agile Working Culture. Agile
coaches delivered a total of 9,488 person*hours of training in team
competencies, role-based development, and the basics of agile
working.
According to the findings of the Corporate Health Index Base Survey
conducted prior to the Agile Transformation, employee satisfaction in
agile areas was 76.8%, but it improved to 87% by December 2023.
Similarly, it is pleasing to observe that Agile Principles have spread
throughout the Bank (87.6%) and that Team Positivity results have
also increased (89.8%). The Bank's subsidiaries continue to get
training, team coaching, and transformation services.
Since the day it was founded İşbank has had a supportive attitude
toward female employees. In 2020, İşbank reinforced this egalitarian
approach by becoming a signatory to the United Nations Women’s
Empowerment Principles (WEPs) and pledged to support and
facilitate women’s participation in employment in Türkiye. İşbank is
also a member of the global initiative known as 30% Club, which
works to raise the number of women in executive leadership roles on
company boards all across the world.
The Bank’s Gender Equality Policy was formed in 2021 by resolution
of the Board of Directors. With the Board’s approval, the Board of
Directors Diversity Policy went into force in 2022.
In 2022, a program was developed to put the Bank’s gender equality
efforts into a structural framework under the Gender Equality Policy.
The aim of this program is to develop best practices that create
impact by considering all stakeholders in the Bank’s value chain.
To accomplish this, a four-pillar structure was developed with
the dimensions of employees, suppliers, customers, and society.
Working Groups, which comprise various Bank business units,
continue to address this issue through various actions. The Women's
Empowerment Declaration outlines the Bank’s goals and strategies
for promoting gender equality.
To access the Gender Equality Policy, please click here
Please click here to access the Women's
Empowerment Declaration.
For İşbank, providing equal opportunities to all employees without
discrimination is a material topic. Discrimination based on gender,
language, religion, ethnicity, or age is not permitted in business
processes. The Bank places high value on promoting gender equality
and engages in training and practices in this regard.The Bank’s Board
İşbank, one of the institutions with the highest
number of female employees in Türkiye, prioritizes
equal opportunities to all employees without
discrimination.
The Bank’s Board of Directors comprises 11 executives, two of them
are women. The percentage of female executives on the Board of
Directors is 18.18%. During recruitment, all candidates are given with
equal employment opportunities, without discriminating against
gender. While 50% of job applications are women and 50% are men,
49% of the Bank's newly hired employees in new graduate positions
are women and 51% are men .
Breakdown of Employees by Gender*
Male
46.82%
Female
53.18%
Breakdown of Managers by Gender * *
Female
40.29%
Male
59.71%
* Excluding employees with the title of Private Security Officer
**Assistant Manager and higher titles
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Female employee ratio*
44.81 %
Ratio of female
employees promoted
38.97%
Ratio of female
employees in income-
generating roles
40.29%
Ratio of female
managers**
16.78%
Ratio of female
senior executives
36.67%
Ratio of women
working in information
technology (IT)
4.35%
Ratio of female
engineers
38.39%
Ratio of female
employees in the top
10% of the Bank’s
highest paid employees
44.24%
Ratio of women in the
highest pay quartile at
the Bank
52.03%
Ratio of women in
the upper middle pay
quartile at the Bank
47.26%
Ratio of women in
the lower middle pay
quartile at the Bank
49.22%
Ratio of women in
the low pay quartile
at the Bank
7.32%
Average unadjusted
gender pay gap
48.73%
Ratio of female employees
recruited in 2023
99.80%
Rate of female
employees returning
from maternity leave
* Excluding employees with the title of Private Security Officer
**Assistant Manager and higher titles
Equal pay for equal work
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 pay differentiation within the remuneration policy. The Bank
applies remuneration system that is transparent and measurable
remuneration system and that is not based on religion, language, race,
age, class, or gender. While ensuring the health, safety, and welfare of
all employees, regardless of gender, the specific demands and needs
of women are considered.
The "Gender Equality in Remuneration Audit Report”, prepared in
2023 and presented to the Audit Committee, 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.
Career Opportunities
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 may apply to this
program, which offers technical training for 10 weeks and the
opportunity to work in the Bank’s Information Technologies, Data
Management, or Head Office business lines to women who are
fourth year university students or graduates, under 30 years old and
who passed the evaluation process.
Awareness for equality
İşbank implements gender equality practices covering all employees
and activities in line with the principles of equal opportunity and
diversity. The “Gender Equality, Diversity and Inclusion in Institutions:
Why and How” seminar, attended by 41 executives, shared current
information and practice examples from Türkiye and around the world
on gender equality, diversity, and inclusion. The seminar also included
suggestions for policy development, methods and tools for use, and
reporting guidelines for upcoming stages.
Within the framework of the Bank's gender equality-aware
practices, in 2023, 102 executives attended the “Leader Women”
Program, which was launched to encourage female employees
toward more active participation in management and to support
their advancement to senior management positions. As part of the
program, following trainings on gender equality and developing
inclusive and genuine leadership skills, participants gather in
small groups under the mentorship of experienced managers for
experience-sharing sessions throughout the year.
The “Diversity and Inclusion” course, which is delivered in career
training programs for new employees with the titles of Officer and
Assistant Specialist, as well as employees promoted to Executive
and Assistant Manager roles, includes a one-hour course on tacit
prejudices and gender equality. 2,388 employees attended this
training program.
Under the umbrella of Management Development Conferences
designed for the participation of executives and management
candidates throughout the year, 4,334 employees attended 11
seminars, including "Empowering Equality", "Sustainability; (Am)
I Responsible for the Planet," and "Breaking Down the Walls of
Violence Together".
To minimize the use of masculine language in favor of gender
equality, the “Gender-neutral Dictionary” application developed by
Softtech was purchased in 2023 and integrated into the Outlook
application, with the aim of eliminating the use of discriminating
phrases and raising awareness.
The “Sexual Harassment Awareness in Business Life” digital training,
developed to help raise employees' awareness on gender equality,
was implemented. The training covered the definition and types
of harassment, as well as instances of verbal, visual, and physical
harassing behavior. In addition to this training, 3,040 employees
completed the “Correct Approach Towards Disability” and “Sign
Language” trainings in 2023. The contents of these trainings were
prepared by the Banks Association of Türkiye and made available
to employees via Learning World since 2017. Also, our employees
received the “Domestic Violence against Women” digital training,
which covers domestic violence against women, what to do in the
event of violence, and the impact of domestic violence on women,
children, and young people.
Gender equality is a sensitive issue that İşbank addresses and
supports in communication activities. Women/female farmers
contribute significantly to agricultural production and equal visibility
in rural regions is promoted. To demonstrate this significance and
appreciation, the Bank assesses its advertising and marketing
content from this perspective, focusing on the positioning of women,
textual expressions, selected imagery, and scenario flows. Content
for use in the Bank’s marketing and advertising activities is prepared
with gender discrimination in mind, vetted by relevant teams
before publication, and evaluated in terms of all biases and identity
distinctions, including gender. In case some or all of the content is
deemed inappropriate, feedback is delivered to the relevant business
units and contracted third-party companies, and business processes
are developed to address this issue. In machine learning models,
gender information and information such as “date of maternity leave”
are avoided since they may lead to gender prediction. Within this
scope, prior to the publication of communication activities, women’s
roles are delicately managed, and texts are written with gender
equality in mind. There were no complaints of gender discrimination
in marketing and advertising activities.
Family-friendly employer
İşbank values its employees’ family lives. For this purpose, practices
that support employees’ work-life balance are implemented.
İşbank has implemented practices to facilitate female employees
return to work after childbirth. Thanks to these practices, 99.8% of
female employees who went on maternity leave in 2023 returned to
work.
Female employees on maternity leave maintain their positions, and
following the end of their leave, they can resume their duties in the
same position and location. They can request unpaid maternity
leave before starting work or take advantage of part-time work
arrangements. For new mothers, breastfeeding rooms have been
designated to provide a more comfortable working environment
following maternity leave. Employees who take nursing breaks might
also benefit from personnel transportation services. Mother and child
benefit from the Bank’s extensive health benefits. Female employees
working at the Bank’s TUTOM location can send their children
between the ages of 36 and 72 months to the Private Tuzla Bilfen
Kindergarten, which is located there. All employees with children get
a maternity and child allowance. Male employees can take a longer
paternity leave than is stipulated in the regulations.
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İşbank protects its unique corporate culture and employee rights
through a wide range of audit and communication activities. If
suspicion arises during routine audits undertaken by the Board
of Inspectors, that the Bank employees do not adhere to work
standards, or if the Board receives a claim that the operating
principles are not followed, the matter is thoroughly investigated. If
tangible evidence is found that supports such suspicion or claim,
the Board reviews the reports prepared to allow the necessary
administrative decisions to be made in accordance with the Bank’s
collective labor agreement and the legislation before transferring
them to the relevant Head Office Divisions for action.
For behaviors deemed to be in violation of the Bank's policies, the
required disciplinary action, up to termination of the employment
contract, is taken in accordance with the Human Resources
Regulation and applicable articles and procedures of the Collective
Labor Agreement. When circumstances necessitate legal action, the
infraction is brought to the attention of legal authorities. Accordingly,
29 investigations were conducted and referred to the related Head
Office Divisions in 2023.
Sexual harassment allegations submitted to the Board of Inspectors
are investigated by the Board, and the findings are forwarded to the
relevant disciplinary units of the organization in accordance with the
provisions of legal and internal regulations.
Internal Communication and Employee Participation
İşbank values its employees’ ideas and suggestions. Within this
context, the Bank listens to the employee suggestions, complaints,
and feedback through constant communication channels and
incorporates them into its management and decision-making
processes. İşbank uses various platforms to systematically ensure
employee participation.
ੵ As part of the Employee Communication Platforms and Programs
(ÇİPP), trend surveys are conducted among employees, and new
activities are planned using this method. This platform offered
innovations such as cultural tours, online workshops, competitions,
parenting seminars, and e-sports activities, resulting in greater
participation of employees in social responsibility activities. Hobby
and interest groups created through ÇİPP provide employees with
opportunities to expand their communication networks within the
Bank.
who report a violation, are not subject to any disciplinary action,
direct or indirect retribution, or disadvantage relative to their peers.
ੵ Submissions received via the “Negative News Line” are limited to
the CEO’s viewing and immediate response. Employee privacy and
confidentiality are therefore protected at the highest level. In 2023,
907 employees created 1,058 negative news items, and relevant
business divisions assessed product and process improvements.
ੵ The “About Me” platform was developed to provide accurate
and detailed information to support the Bank's decision-making
processes and to enable employees to communicate issues
they believe the Human Resources Function should know. The
information entered on the platform can only be viewed by
authorized personnel in the Human Resources Management
Division and by the employees themselves, and the confidentiality
of the shared information is essential. Employees can use this
platform send notifications under the topics “About My Family”,
“About My Health”, “I Have a Complaint”, “I Have a Wish”, and “About
My Career”.
ੵ The suggestion system, known as “I Have a Proposal” and in
use since 1996, was renewed and made available to employees
after being renamed “I Have a Suggestion” on July 26, 2012, to
reflect technological advancements and changing needs. The
features of the suggestion system, which is designed to create new
applications and solutions related to the banking system together
by utilizing the knowledge and experience of employees, to develop
and improve the customer experience, to develop the creativity
of employees, and to increase their sense of job satisfaction by
enabling them to participate more, are briefly as follows:
Finding new product or service areas,
Providing better and higher quality service to customers,
Creating additional services and use cases for existing products,
Ensuring that transactions are carried out with less labor, time,
and cost,
Empowering the Bank's corporate identity and image,
Ensuring that the Bank's resources are used more effectively and
efficiently,
Making the working environment and conditions more favorable,
ੵ HR Help Desk (Maximo) is an application that receives and forwards
Creating new marketing and sales opportunities,
employee opinions, evaluations, requests, and complaints to the
relevant units.
Being technologically innovative,
ੵ There are internal confidentiality systems for employees to report
Social responsibility
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.
The reports are kept confidential; and unless expressly requested,
the name of the reporting person is kept confidential. Employees,
All employees can make suggestions on these topics, as long as they
bring innovation and benefit to our Bank's practices and cover just
one topic.
Head Office employees cannot benefit from the suggestion system’s
rewards, even if they submit suggestions on topics over which they
have direct control and implement in their divisions' fields of activity.
The process of evaluating suggestions is as follows:
Employee suggestions are preliminarily evaluated by the
Corporate Architecture Division. Then, if necessary, they are sent
to the relevant Divisions according to the subject matter.
Suggestion owners receive responses via the system within a
maximum of 15 days from the date of entry.
Suggestion owners can monitor the outcome of their
suggestions through the system.
At the end of these processes, Suggestion owners get gift vouchers
from İş Kültür Publications after their suggestions are deemed
favorable and approved for implementation.
The “I Have a Suggestion” application aims to create new
applications and solutions related to the banking system by utilizing
the employees’ knowledge and experience , thereby improving and
enhancing the customer experience. The application also aims to
boost employees’ creativity and their job satisfaction by increasing
their participation. During the reporting period, 3,894 suggestions
were submitted, with 182 implemented.
Employee Health
and Safety
One of İşbank's main responsibility areas is to ensure a healthy
and safe work environment that meets international standards. At
İşbank, the Human Resources Management Division Manager, who
reports two levels below than the General Manager, is the most
authorized person in charge of employee health. In accordance with
the provisions of the Occupational Health and Safety Law, OHS
Committees with employee representation are established in the
Bank's premises with more than 50 employees.
As of year-end 2023, there were 40 OHS Committees operating at
İşbank, and these Committees convened 135 times during the year.
The meetings were attended by 267 board members, with 113 as
employee representatives.
In addition to a healthy and safe working environment, it is also
important to maintain it. This is only possible if employees know OHS.
The Bank organizes trainings to raise OHS awareness among its
employees.
In 2023, 129,474 person*hours of OHS training
were provided to 21,006 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.
Preferred
Employer
İşbank strives to be a preferred employer for qualified employees.
By attracting prospective labor force, the Bank contributes to
developing young employees while also increasing the organization’s
sustainability and brand value and retaining existing employees.
Communication with university students takes place through
student clubs, career centers, career platforms, and youth agencies.
Employees representing the Bank's business units engage with
young people at career meetings, seminars, and other events
such as ideathons and bootcamps to share their corporate culture,
experiences, and industry knowledge. The Bank's in-house
technology and innovation efforts are shared with students, and the
Bank benefits from their ideas on product and service development
as well as workplace organization.
The MasterClass Internship Program, MasterClass Digital
Development Program, and the Future Hub programs all students
in their final two years of university to get to know the institution
closely, collaborate on joint projects with current employees, and gain
personal and professional development opportunities through online
training.
Apart from mentoring university students through development
programs, the Bank and İş Sanat also provide them with the
opportunity to benefit from in-bank training and take part in creative
events. In this way, young people enrich their personal and cultural
lives during education. Graduates of these programs have the
chance to work part-time, begin their careers, learn on the job, and
enhance their competencies. Technical information on various areas
of expertise, such as Information Technologies, Data Science, or
Digital Banking, is published on digital platforms through short online
trainings to help all interested parties develop their competencies.
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İşbank provides its employees with opportunities to improve their skills
throughout their careers and prioritizes the development of future
competencies as a strategy. To develop the competencies of employees,
a wide range of training programs and learning tools customized with
state-of-the-art technologies are offered in line with the equal opportunity
principle. "Being the bank of the future that creates sustainable value" is
also in line with İşbank’s vision, which includes supporting its employees
with continuous development.
Career Trainings
Starting from their first day of work, new employees at our Bank
participate in "Starting My Career" training sessions that are tailored
to their specific titles and duties. In 2023, 1,821 employees took part
in the training. 1,660 employees took part in the promotion trainings,
which were organized to provide our employees who were promoted
to Senior and Assistant Manager positions the technical information
they would need while preparing for their new duties as well as the
theoretical groundwork to help them develop their management skills.
Training Catalog
Employees attend seminars under the “İş'te Sohbetler” brand
on various topics and benefit from various trainings offered in
the “Training Catalog”, which is prepared to support competency
development and transformation in line with our Bank's strategic
goals, based on their individual needs and preferences. In 2023, as
part of the Training Catalog, 2,386 employees received training on
a total of 30 different topics, including professional development,
digitalization, personal development, and leadership.
Trainings for Field Employees
Trainings on various subjects were held, taking into consideration
the types of branches, roles, and the duties and responsibilities
associated with these positions, in order to support field employees
in their competency transformation. The Sales Academy Phase
3 trainings for individual sales teams, as well as Phase 4 trainings
tailored to address next-generation customer behaviors and
expectations, continued. In addition to the trainings organized for
commercial sales teams, employees were offered two modules
of the “Tradespeople, SME and Agriculture Academy”, which
was launched in 2022 with an emphasis on getting to know
tradespeople, SME, and agricultural customers. In 2023, İşbank's
specialized branch structuring included programs focused on
training designed for agriculture specialized and entrepreneurship
branches. The employees of entrepreneurship branches attended
the “Entrepreneur Banking Training Program,”, while the employees
of agriculture specialized branches attended the “Agriculture
Specialized Branches Development Program” as well as trainings
on technical product knowledge, sales, and technology with year-
round modules. Commercial and corporate specialized branch
employees attended trainings on different topics to assist their
technical knowledge and sales competencies, while employees in
private banking specialized branches received “Investment Products,
Derivatives and Special Structured Products” and “Personal Brand
Management and Impact Creation” trainings. In 2023, over 20.000
employees completed over 131,000 hours of training as part of role-
based trainings offered to branches and direct sales teams.
Competencies of the Future
The first phase of the Digital Academy Program, which consists of
five modules and focuses on digital competency in the fields of User
Experience and Digital Marketing, was completed with more than
110 thousand hours of training. For those who have completed the
first phase of the program will be offered practical trainings in 2024.
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These trainings, theoretical knowledge acquired will be applied in an
end-to-end practical manner within the scope of a project.
In 2023, a total of 70 employees attended the Innovation and
Marketing Academies designed in collaboration with leading
universities and institutions for employees in related business areas in
line with future competencies.
Within the Artificial Intelligence Academy and the programs designed
to improve the technical knowledge and skills of the Information
Technologies (IT) business family, 772 people received a total of
39,900 hours of training.
The Reverse Mentoring Program was launched in 2023 with the
aim of fostering intergenerational collaboration, promoting a more
inclusive and dynamic working environment, and strengthening
İşbank’s ongoing learning and development culture. 33 managers
and 67 young employees started voluntary interviews for the first
term of the program.
Leadership Trainings
İşbank’s management and leadership development programs are
designed to strengthen next-generation leadership competencies
as well as to promote a winning culture and a leadership approach
focused on continuous development.
Among the programs offered in this scope, the following stand out:
Launched in 2023, the Leadership Development Today and in the
Future Program aims to ensure behavioral change and to support
the employees' potential at the transition stage to management by
focusing on the required competencies. 116 employees received a
total of 4,176 hours of training.
A total of 27,044 hours of training was provided to a total of 657
employees in the programs (Assistant Manager Development
Program, Branch Manager Development Program, Effective
Management and Leadership Program, ESMT Leadership
Development Program, etc.) attended by executives throughout
their careers, designed to support the technical knowledge and
management skills required for their relevant roles.
As part of the Branch Manager Training Catalog, in which employees
with the title of Branch Manager participate according to their
interests and needs, a total of 490 employees received a total of
5,295 hours training on 19 topics in 2023.
“Sustainability and Our Bank's Practices in Sustainable Finance”
training was provided to executives and sales teams working in
Corporate and Commercial specialized branches to ensure that they
have full knowledge of the Bank’s sustainable development goals as
well as information about its sustainable financing products.
Gender Equality Trainings
Within the framework of the Bank's practices regarding gender
equality, the Leader Women Program aims to encourage active
participation of female employees in management and support their
advancement towards senior management positions. The program
includes trainings on gender equality and developing inclusive
and genuine leadership skills. Afterwards, throughout the year,
participants gather in small groups for experience-sharing meetings
under the mentorship of experienced managers. In 2023, a total of
198 managers attended 4,568 hours of training.
The training materials prepared to raise employees' awareness of
a potential disaster situation and instruct them about what to do
before, during and after a disaster were implemented under the title
"Disasters and Disaster Protection Program". The program, which
consists of 31 training materials in total, covers natural disasters such
as earthquakes, fires, and storms, as well as precautions and actions
to take to reduce disaster damages.
The “Gender Equality, Diversity and Inclusion in Institutions: Why and
How” seminar, attended by 41 executives, shared current information
and practice examples from Türkiye and around the world on
gender equality, diversity, and inclusion. The seminar also included
suggestions for policy development, methods, and tools for use, and
reporting guidelines for upcoming stages.
The seminars "Empowering Equality", "Sustainability; (Am)
I Responsible for the Planet" and "Breaking Down the Walls
of Violence Together" within the Management Development
Conferences organized for managers and manager candidates, the
"Women in Business Life and Inclusive Leadership" training within
the Leader Women Program and the "Gender Equality, Diversity
and Inclusion in Institutions: Why and How" seminar organized for
employees with the titles of Unit Manager and above are focused on
supporting employees' self-awareness regarding tacit prejudices. A
total of 598 managers and manager candidates participated in these
trainings. Furthermore, all management and leadership trainings
emphasize the inclusive leadership approach and the need to avoid
discriminatory behaviors.
Innovative Media
All employees may access various on-demand digital content such
as video, digital training, and games via the "Learning World" digital
learning platform. The platform will soon have a gamification module
added and Learning World will be positioned as platform for learning
experiences.
Based on the agreement with the Neoskola platform, which features
content prepared by leading expert trainers and is presented in
high-quality production, employees were given access to four more
trainings under the "Learn from the Best" brand and in addition to the
ten already provided. In addition, the Bank's employees continued
to have access to the Vidobu platform, which contains instructional
videos created by expert trainers.
Digital learning activities to raise employee awareness on the notion
of sustainability continued. Also, employees were given access to
the "Sustainable Development Goals" training, which was designed
to raise awareness of sustainable development goals. In addition
to the related training, the Sustainable Finance training aims to
provide information on the concept of sustainable finance, the Green
Deal in the finance sector, and how sustainability is handled in the
context of digitalization; the "Our Sustainability-Focused Products
and Services" digital training, which includes information about the
products and services provided with a focus on sustainability, was
uploaded to the Learning World platform.
Employees were given access to monthly Learning World videos
featuring informative content created by experts from İş Portföy A.Ş.,
a subsidiary of İşbank. The videos cover topics such as monthly
economic expectations and investment products that can be offered
to customers based on these expectations. the "Gold Fund" and
"TEV Education Support Hedge Fund" videos were added to the
"Mutual Fund Recommendations" digital training program, which is
managed with the expertise of İş Portföy A.Ş. and given to customers,
in addition to the existing video content.
The second period of the İşLegends learning game, which was
prepared to raise employees' awareness of strategic goals, support
them in acquiring future competencies in line with the banking of
the future and its evolving business needs, and contribute to the
level of knowledge about the Bank's vision, mission and values,
was made available to employees on May 10, 2023. More than
2,500 employees took part in the second period, which ended on
November 1, 2023, and over 1 million questions were answered in
total.
Employees were given access to the first part of the "Credit Risk
Academy" via Learning World on October 2, 2023. The goal of this
program was to improve employees' competencies in understanding,
managing, and evaluating credit risk. The program was intended to
consist of four parts, with each part focusing on a basic concept such
as risk and credit relationship, financial risks and internal systems
regulation. More than 2,000 employees viewed the introduction
panel of said academy.
Performance and Learning Culture
İşbank executives are trained internally. In other words, employees
are potential managers as well. Depending on their performance, all
employees have the opportunity to be promoted to management
positions. Accordingly, the Performance Management System plays
an important role in İşbank's human resources practices.
İşbank renewed its Performance Management System in 2023,
including all elements. In this context, the Self-Assessment and 360
Degree Assessment practices were implemented for the first time
in the performance evaluations in 2023. Their purpose was to allow
employees to share their self-assessments with their managers and
to receive evaluations from their teammates and subordinates (if
any), and to build the Manager Evaluations based on the outcomes
of these assessments. Then, these were finalized through the Review
process. The new system aims to transfer the observations of a larger
group of evaluators engaged in the evaluation process with concrete
findings. This way our employees have the opportunity to learn about
various viewpoints on themselves and to provide our employees with
more input to their career processes through objective performance
data.
Assessment Center Practices
A total of 636 İşbank employees holding the titles of Assistant
Manager/Specialist/Inspector participated in the "Transition to
Management Assessment" in 2023. In order to base their transition
to the management phase on more objective and tangible criteria,
this assessment evaluates their management approach, the
impression they make professionally and socially, their personal
characteristics, their level of competence, and their vision for fulfilling
their responsibilities, as well as their suitability for management in line
with the Bank's management culture and brand.
In addition to the “Transition to Management Assessment Center”
practices, a different assessment process called the "Manager
Assessment Center" was designed for employees currently serving
as managers at the 8th level. This center aims to measure the
potential and readiness of the relevant managers for their next
position. From April 2023 until the end of 2023, 420 employees
participated in this assessment.
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Citizen
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173
Transparent and
Ethical Management
Contribution to Social
Welfare
Corporate Management
Approach
Transparent and
Ethical Management
In its 100th year, İşbank, a bank identified with trust
and reputation in the banking sector, continues
to create value for its stakeholders with its deep-
rooted corporate culture, internalized corporate
governance principles, and transparent and
accountable business practices.
Risks
Exposure to penal sanctions due to non-compliance with rapidly changing
and increasing legal regulations
Being out of the competition because of the top management’s knowledge
and experience level not keeping up with the changing economic
conjuncture
Loss of trust with stakeholders and dismissal from relevant engagements
due to failure to meet reporting and information-sharing requirements
Opportunities
Increasing the interest of investors and customers with an excellent
reputation and brand value
Contributing to reputation management with transparent information sharing,
gaining a competitive advantage in different performance areas
Relevant Stakeholders
Material Topics
Shareholders
Investors
Employees
Customers
Business Ethics,
Transparency and
Corporate Management
Efficient Risk
Management
Contributed SDGs
Related Capital Elements
Financial
Capiral
Intellectual
Capital
Social-Relational
Capital
Key Performance İndicators
Number of employees receiving
Anti-Bribery and Anti-Corruption
Training
Total hours of Anti-Bribery and
Anti-Corruption Training
2021
5,716
627
2022
17,015*
2,130
2023
19,889
2,667
Risk Management
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
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
Number of times the Risk
Committee convened: 12
Number of times the
Operational Risk Committee
convened: 3
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
175
Number of foreign branch audits
Number of subsidiary audits
Number of Head Office division/
process audits
Publishing of Integrated Annual
Report
2
10
24
79**
3
8
20
82
6
7
39
Completed.
Completed.
Completed.
Number of social media followers
(million)
2.6
2.7
2.8
Developing cooperation with
national and international initiatives
Fulfilling UNEP FI Principles
for Responsible Banking
commitments
See Initiatives Supported in the Field of Sustainability
See Initiatives Supported in the Field of Sustainability
Fulfilling NZBA commitments
See Initiatives Supported in the Field of Sustainability
*The main reason for the rise is the number of persons who completed the digital training “Compliance with Combating Financial Crimes and
Sanctions Policy Program”, the content of which was renewed and assigned to all employees as legal compliance training in November 2021.
**The number of branch audits decreased as the number of central audits increased.
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Targets for 2023
Realization in 2023
Establishing a “Credit and Risk
Management Academy” 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
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
Managing the impacts arising from the
Bank’s loan portfolio under the NZBA
commitment and setting reduction targets
The first module of the "Credit Risk Academy",
which is intended to improve our employees'
competencies in understanding, managing,
and evaluating credit risk and will consist of
four modules focusing on basic concepts
such as risk and credit relationship, financial
risks, and internal system regulation, was
made available to our employees via Learning
World on October 2, 2023; more than 2,187
employees participated in the academy in
2023.
Targets for 2024 and
Beyond
The first phase of the
Credit Risk Academy,
consisting of 4 parts, is
planned to be completed
and presented to our
employees in 2024.
Partnerships for Climate Action, p.82
Responsible Banking, p. 72-74
Target is protected.
In 2023, İşbank announced its 2030 emission
reduction targets for carbon-intensive sectors
such as energy generation, cement, and iron
and steel. Accordingly, the aim is to reduce
emission intensity by 61% in the power
generation sector, 21% in cement, and 10% in
iron and steel by 2030, compared to the base
year 2021. Science-based global scenarios
were considered for determining sectoral
reduction targets based on base year values.
ੵ In 2023, the annual
realization status of
the announced targets
will be shared with the
public.
ੵ Emission intensity
reduction targets will be
set for other carbon-
intensive sectors.
ੵ Transition plans will
be prepared and
announced.
Management Structure
Consisting of 11 members, İşbank’s Board of Directors is the highest
management body responsible for steering the Bank’s strategy.
There is no practice of subjecting a certain proportion of the Board
Members to rotation at the General Assembly.
With 4 independent members15, the Board of Directors is composed
of non-executive members, except for the CEO. The roles of
the CEO and Chairperson of the Board of Directors are held by
different individuals. The Board of Directors has established several
governance committees in place to support the its activities in
various areas. The Executive Committee, which is responsible for
implementing the strategies defined by the Board of Directors and led
by the CEO, consists of 12 members, including 2 women, in addition
to the CEO.
The members of İşbank’s Board of Directors are responsible to the
Bank and its shareholders in the performance of their duties. The
members are required to perform their duties within the powers and
responsibilities established by law and the Articles of Incorporation,
and in accordance with the principles and procedures set forth in the
Bank’s “Directive on the Operating Procedures and Principles of the
Board of Directors”.
İşbank's Board of Directors consists of 7-11 members, one of whom
is the CEO, as stipulated 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 determined in accordance with the regulations of
the Capital Markets Law on corporate governance.
Candidates having the qualifications prescribed by law are selected
by the Board of Directors to fill vacancies due to death, resignation, or
other unforeseen reasons, and such members shall be submitted for
approval at the first General Assembly meeting to be held. Members
selected in this manner serve until the first meeting of the General
Assembly, and if their selection is approved by the General Assembly,
they shall serve for the remainder of the term of the member they are
selected to replace.
If there is a conflict of interest with respect to any of the items on the
agenda of the İşbank Board of Directors, the Chairperson, the Vice
Chairperson, and the members shall not preside over the meeting
and shall not participate in the discussion of the items on the agenda
with respect to which there is a conflict of interest.
İşbank’s General Assembly has a structure that allows shareholders
to express their opinions and make suggestions. Shareholders
or other interested parties who wish to speak on an item on the
agenda notify the chairperson of the meeting. The chairperson shall
announce the persons wishing to address the General Assembly
and shall call upon them in the order in which they have requested
to speak. Pursuant to Article 1527 of the Law, the procedures and
principles set forth in said article and sub-regulations shall be applied
with respect to the submission of opinions and suggestions by the
shareholders or their representatives participating in the General
Assembly meeting by electronic means.
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¹⁵ 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.
Good Corporate CitizenLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Board Member Matrix*
Age and Average Tenure
Independence
Educational Background and Gender Diversity
Number of Board Members and their Tenure
Policy: To become a Board Member, the person must have the capacity to exercise
civil rights and possess the qualifications required by applicable law. There is no
maximum age specified. Board Members shall be elected by the General Assembly
at least every three years, and they may be re-elected. If a vacancy occurs for
any reason during the interim period, a member shall be selected by the Board
of Directors to complete the remainder of the predecessor’s term and shall be
submitted to the approval of the first General Assembly to be held.
Policy: 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. Ahmet
Gökhan Sungur and Gökhan Şen serve as Independent Board Members; Güzide
Meltem Kökden and Sadrettin Yurtsever are Independent Board Members since
they are also members of the Audit Committee. Status of Independence; (%) 36
Independent (%) 64 Non-Independent.
Distribution of Experience of Non-
Executive Committee Members:
Distribution of Experience of
Executive Committee Members;
Not Independent
64%
Independent
36%
0-5
Years
10
5-10
Years
-
>10
Years
-
0-5
Years
1
5-10
Years
-
>10
Years
-
Average Age 60.7
Average Age 56
Average Tenure 2 years, 10 months.
Average Tenure 2 yeas, 9 mmoths.
Educational Background (%)
Policy: The Board of Directors consists of 11 members, including the CEO, who is
a 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 must have the capacity to exercise
civil rights and possess the qualifications required by applicable law.
University
(4-year college)
27%
Post
Graduate
73%
Number
of Board
Members
11
11
11
11
11
Gender Diversity (%)
91%
82%
9%
18%
2022
2023
Female
Male
2019
2020 2021 2022 2023
Changes in the Board of Directors Within the Last 5 Years
In 2019, 2 Members left, and 2 new Members were elected to complete the
remaining terms of the vacated Members.
In 2020, at the Ordinary General Assembly Meeting held, a total of 6 Members, 5
as Members and 1 as an Independent Member, were vacated and 6 new Members
were elected with the same composition and 4 Members were re-elected.
In 2021, 1 Member vacated, and 1 new Member was elected to complete the
remaining term of the vacated Member.
In 2022, there was no change in the composition of the Board of Directors.
In 2023, at the Ordinary General Assembly Meeting, a total of 3 new Members were
elected, 2 as Members and 1 as an Independent Member, and 7 Members, including
1 Independent Member and 6 Members, were re-elected.
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
Güzide Meltem
Kökden
Hakan Aran
Fazlı Bulut
Durmuş
Öztek
Recep Hakan
Özyıldız
Mustafa Rıdvan
Selçuk
Ahmet Gökhan
Sungur
Sadrettin
Yurtsever
Şebnem Aydın
Gökhan Şen
Number of Board
Meetings Not
Attended by the
Member
0
0
0
0
0
0
0
0
0
0
Board Member
Adnan Bali
Güzide Meltem
Kökden
Hakan Aran
Fazlı Bulut
Durmuş Öztek
Recep Hakan
Özyıldız
Mustafa Rıdvan
Selçuk
Ahmet Gökhan
Sungur
Sadrettin Yurtsever
Şebnem Aydın
Gökhan Şen
0
* Prepared based on Glass Lewis Board Skills Matrix.(As of 31.12.2023)
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Good Corporate CitizenLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Board of Directors
Adnan Bali
Chairperson of the Board of Directors
Güzide Meltem Kökden
Vice Chairperson of the Board of Directors
Hakan Aran
Member of the Board and Chief Executive Officer
Fazlı Bulut
Member of the Board
Durmuş Öztek
Member of the Board
Recep Hakan Özyıldız
Member of the Board
Mustafa Rıdvan Selçuk
Member of the Board
Ahmet Gökhan Sungur
Independent Member of the Board
Sadrettin Yurtsever
Member of the Board
Şebnem Aydın
Member of the Board
Gökhan Şen
Independent Member of the Board
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Good Corporate CitizenLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Board of Directors
Adnan Bali
Chairperson of the Board of Directors
Güzide Meltem Kökden
Vice Chairperson of the Board of Directors
Hakan Aran
Member of the Board and Chief Executive Officer
Fazlı Bulut
Member of the Board
Durmuş Öztek
Member of the Board
Recep Hakan Özyıldız
Member of the Board
1962, İslahiye. He graduated from the
Economics Department of Middle
East Technical University, Faculty of
Economics and Administrative Sciences.
Mr. Adnan Bali began to work as
Assistant Inspector in the Inspection
Board of İşbank. He served at Fund
Management Department as Assistant
Manager in 1994, as Group Manager
in 1997 and was appointed to Head
of Fund Management in 1998.Mr. Bali
became Branch Manager of Şişli Branch
in 2002, Galata Branch in 2004, and was
promoted to the Deputy Chief Executive
on 30 May 2006. He was appointed as
the CEO of İşbank on 1 April 2011.
Apart from his role in the Bank, Mr.
Bali is also the Chairperson of Türkiye
Sınai Kalkınma Bankası A.Ş. and the
Chairperson of the İşbank Members’
Supplementary Pension Fund.
Mr. Bali, who was elected as a member
of İşbank's Board of Directors on 31
March 2021 and 30 March 2023 and
as the Chairperson of İşbank on 1 April
2021 and 31 March 2023, also serves
as the Chairperson of the Remuneration
Committee, the Risk Committee, the
Sustainability Committee and the
Board of Directors Operating Principles
Committee and a member of the Credit
Committee.
1969, Kastamonu. Ms. Kökden holds a
bachelor’s degree from the International
Relations Department of Ankara
University, Faculty of Political Sciences,
and a master’s degree in EU Law from
Ankara University, Institute of Social
Sciences. In 1991, Ms. Kökden began to
work as Assistant Investment Specialist
at İşbank. She served as Investment
Specialist in 1997, Assistant Manager in
1999, Unit Manager in 2003, and Division
Head in 2006 at the Capital Markets
Division. Between 2013 and 2023, Ms.
Kökden served as the Head of the İşbank
Members Supplementary Pension Fund.
Ms. Kökden also served as Board
Member at Takasbank, as Deputy
Chairperson of İş Yatırım Menkul Değerler
A.Ş., Topkapı Danışmanlık Elektronik
Hizmetler Pazarlama ve Ticaret A.Ş, and
as Chairperson of İş Yatırım Ortaklığı A.Ş.
and İş Portföy Yönetimi A.Ş.
Apart from her role in the Bank,
Ms. Kökden serves as the Deputy
Chairperson of İşbank Members
Supplementary Pension Fund.
Ms. Güzide Meltem Kökden, who was
elected as a member of İşbank's Board
of Directors on 30 March 2023 and as
the Deputy Chairperson of the Board
on 31 March 2023, 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.
1968, Antakya. 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 Software
Development Department 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, Information Security
Committee and as 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.
1964, Pertek. Mr. Fazlı Bulut 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.
1953, Sivas Şarkışla. Mr. Durmuş Öztek
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.
1956, Bursa. Mr. Recep Hakan Özyıldız
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. Öztek served as a Finance Auditor
between 1975-1986 in the Ministry
of Finance. In the following years, he
served as Department Head, Deputy
General Manager and General Manager
in the General Directorate of Budget
and Financial Control; Chief Auditor
and Member of Financial Advisory
Committee in the Ministry of Finance;
Auditor in Turk Telekom, Member of the
General Committee in Council of Higher
Education, Financial Counselor in Turkish
Embassy in Brussels. He served as a
Ministry Counselor in the Ministry of
Finance between 2006-2011.
Mr. Öztek, who was elected to İşbank
Board of Directors on 31 March 2020
and 30 March 2023, serves as a member
of the Corporate Social Responsibility
Committee and the Board of Directors
Operating Principles Committee.
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; Department Head,
Deputy General Manager and General
Manager at the General Directorate
of Public Finance under Ministry of
Treasury and Finance; Auditor at İşbank,
General Manager of the State Economic
Enterprises in the Treasury, Senior
Advisor of Economics in 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 İşbank Board
of Directors on 31 March 2020 and 30
March 2023.
Mr. Bulut served as Account Expert and
Senior Account Expert at the Ministry of
Finance in the Board of Account Experts
from 1985 to 1997. He taught General
Accounting at 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 in Social
Insurance Institution. 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 for
one year and 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
also has books published on various
subjects.
Mr. Bulut, who was elected to İşbank
Board of Directors on 29 March 2019, 31
March 2020 and 30 March 2023 also
serves as a member of the Corporate
Social Responsibility Committee, the
Corporate Governance Committee and
as an alternate member of the Credit
Committee.
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Member of the Board
Ahmet Gökhan Sungur
Independent Member of the Board
Sadrettin Yurtsever
Member of the Board
Şebnem Aydın
Member of the Board
Gökhan Şen
Independent Member of the Board
1953, Yozgat. Mr. Sungur 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 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 İşbank Board
of Directors on 31 March 2020 and 30
March 2023.
1955, Malatya. Mr. Mustafa Rıdvan Selçuk
graduated from Ankara University, Faculty
of Political Sciences, Department of
Economics and Finance. He received
his master’s degree on 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, Department Head
in the General Directorate of Revenues,
General Manager and Chairman of
Bağkur in the Ministry of Labor and
Social Security, Labor and Social
Security Advisor in Turkish Embassy in
Copenhagen and as Ministry Advisor in
the Ministry of Finance.
Mr. Selçuk, who also serves 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 İşbank Board
of Directors on 31 March 2020 and 30
March 2023.
1964, Bingöl. Mr. Sadrettin Yurtsever
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 İzmir Branch in 1993,
served in the same branch as Section
Head and Sub-Manager. He served
as Assistant Manager in SME Loans
Underwriting Division of 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
Bornova/İzmir Commercial Branch
in 2013 and Mediterranean/Antalya
Corporate Branch in 2018.
Mr. Yurtsever, who was elected to
İşbank Board of Directors on 31 March
2020 and 30 March 2023, serves
as the Chairperson of the Corporate
Governance Committee and as the
member of the Audit Committee,
T.R.N.C. Internal Systems Committee,
the Remuneration Committee, the
Risk Committee, the Corporate
Social Responsibility Committee,
the Operational Risk Committee, the
Sustainability Committee and the
Board of Directors Operating Principles
Committee.
1983, Istanbul. Mr. Gökhan Şen
graduated from Marmara University
Actuary Department and completed
his master's degree in finance at the
same university. Mr. Şen, who started his
career as an Investment Advisor at Ata
Investment in 2006, served as Fund and
Portfolio Manager in 2009, Research
Manager at Bloomberg HT in 2010,
International Markets Research Manager
at Ak Yatırım in 2013, as Economics
Coordinator in 2015, and as Editor-in-
Chief between 2019-2021.
Mr Şen, who is the founder of GBUK
Consultancy and a columnist at
Habertürk, has been working as a
Coordinator at Ciner Cam and Ciner
Group since 2022.
Mr. Şen was elected as an Independent
Member of İşbank’s Board of Directors on
30 March 2023.
1974, Samsun. Ms. Aydın graduated from
Uludağ University, Faculty of Economics
and Administrative Sciences, Business
Administration Department. She started
her career as a candidate Officer at
Suluova/Amasya Branch in 1997 and
was appointed as Section Head at Bafra/
Samsun Branch in 1999, Sub-Manager
at Samsun Branch in 2004 and Sub-
Manager at Bafra/Samsun Branch in the
same year. She was appointed as Branch
Manager at Buğdaypazarı/Samsun
Branch in 2007, at Gazi/Samsun Branch
in 2011 and at Samsun Branch in 2013
and then served as Branch Manager at
Çarşı-Bakırköy/İstanbul Branch in 2018
and Regional Manager of İstanbul-
Bayrampaşa Region in 2022.
In addition her duties at the Bank,
between 2020 and 2023 Ms. Aydın
served as a Board Member of İşbank
Pension Fund.
Ms. Aydın, who was elected to İşbank
Board of Directors on 30 March 2023,
serves as the member of the Credit
Committee, the Corporate Governance
Committee, the Corporate Social
Responsibility Committee and the
Sustainability Committee.
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Good Corporate CitizenLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Executive Committee
Hakan Aran
Chief Executive Officer
N. Burak Seyrek
Deputy Chief Executive
Ebru Özşuca
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
Sezai Sevgin
Deputy Chief Executive
Suat E. Sözen
Deputy Chief Executive
İzlem Erdem
Deputy Chief Executive
Tufan Kurbanoğlu
Deputy Chief Executive
Mehmet Celayir
Deputy Chief Executive
144
145
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1
Hakan Aran
Chief Executive Officer
2
3
N. Burak Seyrek
Deputy Chief Executive
Ebru Özşuca
Deputy Chief Executive
4
5
Ozan Gürsoy
Deputy Chief Executive
Sezgin Yılmaz
Deputy Chief Executive
6
7
Sabri Gökmenler
Deputy Chief Executive
Sezgin Lüle
Deputy Chief Executive
4
5
6
7
1974, Adana. 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,
UK in 2003. In 1996, Mr. Gürsoy joined
the Board of Inspectors as an 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 2016, and was appointed as
Deputy Chief Executive on August 26,
2019.
1975, Kırcaali. Mr. Sezgin Yılmaz graduated
from Uludağ University, Faculty of
Economics and Administrative Sciences,
Department of Economics, and started
his career as a Candidate Officer at the
Bursa Branch in 1997. After serving in
various positions at the Bank, Mr. Yılmaz
was appointed as Regional Manager
of SME Loans Underwriting Division in
Kayseri in 2012 and Regional Manager of
the SME Loans Underwriting Division in
the İzmir Central I. Region in 2015. He then
served as sales manager of İzmir Central II.
Region, Support Services and Procurement
Division Head, and Procurement Division
Head, respectively. Mr. Yılmaz, who was
elected to İşbank Board of Directors on
March 29, 2019, was appointed as Deputy
Chief Executive on August 26, 2019.
1968, Ankara. Mr. Sabri Gökmenler
graduated from the Computer Engineering
Department of Middle East Technical
University in 1991. He completed his
master's degree in the same department
in 1995 and the Advanced Management
Program at Harvard Business School in
2018. 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 was
appointed as Deputy Chief Executive on
January 28, 2021.
1976, Trabzon. Mr. Sezgin Lüle graduated
from the Industrial Engineering
Department of Boğaziçi University's
Faculty of Engineering in 1998. He
completed his master’s degree in
international Banking and Finance at the
University of Birmingham, UK in 2004
and the Advanced Management Program
at Harvard Business School in 2019. Mr.
Lüle began his career in the Organization
Division of İşbank as an Assistant
Organization and Method Specialist in
1998 and became an Assistant Inspector
on the Board of Inspectors in 1999.
He served as Assistant Manager and
Unit Manager at the Board of Project
and Change Management between
2008-2011. He became the Head of the
Corporate Architecture Division in April
2017. Mr. Lüle was appointed as Deputy
Chief Executive on January 28, 2021.
1968, Antakya. Hakan Aran graduated
from the Faculty of Engineering, Computer
Engineering Department of the Middle
East Technical University. He completed
his master's degree in Business
Administration at Başkent University,
and he is currently continuing his PhD in
Banking at İstanbul Commerce University.
Beginning his career at İşbank as a
Software Specialist in 1990, Mr. Aran
was appointed as the Head of Software
Development Department 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 01 April 2021, Mr
Aran also serves as the Chairperson of
the Credit Committee, Human Resources
Committee and Information Technology
Strategy Committee and as member of
the Risk Committee and Operational Risk
Committee.
1970, 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
Department in the same year. After serving
in the Corporate Loans Underwriting
Division as Assistant Specialist in 1994,
Mr. Seyrek was appointed as the Branch
Manager of İşbank AG Filiale Frankfurt in
1998, Assistant Manager of the Başkent/
Ankara Branch in 2001, Manager of
the Ostim Branch in 2004, Director of
Corporate Banking Sales in the Ankara
Central II. Region in 2007, Head of
Corporate Banking Product Department
in 2010, Head of Corporate Banking Sales
Department in 2011, Head of SME and
Enterprise Banking Sales Division in 2013,
and as Chief Executive Officer at İşbank
AG, in September 2013. Mr. Seyrek was
appointed as Deputy Chief Executive of
İşbank on 25 March 2016.
1971, Ankara. Ms. Özşuca, who graduated
from the Economics Department of
the Middle East Technical University,
Faculty of Economic and Administrative
Sciences, completed her master’s degree
in Economics at the Graduate School of
Social Sciences of the same university and
in International Banking and Finance at the
University of Southampton, UK in 1998.
She attended the Advanced Management
Program at Harvard Business School in
2015. She joined the Treasury Division as
an Assistant Specialist in 1993. She served
in the same department as an Assistant
Manager and Unit Manager. After serving
in the Corporate Banking Product Division
between the years 2007-2011, she was
appointed as Head of the Treasury Division
between 2011-2017. Ms. Özşuca was
appointed as Deputy Chief Executive on
November 28, 2017.
1
2
3
146
8
9
Can Yücel
Deputy Chief Executive
Sezai Sevgin
Deputy Chief Executive
10
11
Suat E. Sözen
Deputy Chief Executive
İzlem Erdem
Deputy Chief Executive
12
13
Tufan Kurbanoğlu
Deputy Chief Executive
Mehmet Celayir
Deputy Chief Executive
8
9
10
1978, Ankara. Mr. Can Yücel graduated
from the Economics Department of Middle
East Technical University, Faculty of
Economic and Administrative Sciences.
He attended the Advanced Management
Programme at Harvard Business School.
He began his career as an Assistant
Inspector on the Board of Inspectors
in 1999. Then he served as Assistant
Manager in the SME Loans Underwriting
Division in 2008, Assistant Manager in the
Corporate Loans Underwriting Division in
2009, Unit Manager in the same division
in 2011 and Head of the Corporate Loans
Underwriting Division in 2016. Mr. Yücel
became Branch Manager of the Başkent
Corporate/Ankara Branch in 2020 and was
appointed as Deputy Chief Executive on
August 26, 2021.
1968, Istanbul. Mr. Sezai Sevgin graduated
from Marmara University, Faculty of
Economic and Administrative Sciences,
in 1990. In the same year, he began
his career as an Assistant Inspector on
the Board of Inspectors. Appointed to
İşbank AG in 1997, Mr. Sevgin became an
Assistant Manager at Paris Branch in 1998
and Branch Manager at the same branch
in 2002. He was appointed as the Group
Manager of Corporate Banking Marketing
Division in 2004, Head of the Commercial
Banking Marketing Division in 2007, and
Branch Manager of the Gebze Corporate
Branch in 2011 and the Maslak Corporate
Branch in 2013. He was appointed as the
General Manager of Bayındır Healthcare
Group in 2015. Mr. Sevgin was appointed
as Deputy Chief Executive on December
28, 2021.
1970, Kars. Mr. Sözen graduated from Gazi
University, Department of Economics in
1991 and started working as an Assistant
Specialist at the Training Department in
the same year. He became a Specialist at
the Human Resources Division in 1998,
a Credit Specialist at the Yıldız Posta
Boulevard Branch in 2000, an Assistant
Manager at the same Branch in 2002,
and worked in the Commercial Loans
Division between 2004-2006. Mr. Sözen
was promoted to Unit Manager of the
Corporate Communications Division in
2006, became the Head of the same
division in 2008, and then Corporate
Communications Coordinator and
General Secretary in 2017. Mr. Sözen was
appointed as Deputy Chief Executive on
March 25, 2022.
1968, Istanbul. Ms. İzlem Erdem graduated
from the English Economics Department of
Marmara University, Faculty of Economics
and Administrative Sciences, in 1990.
She attended the Advanced Management
Program at Harvard Business School
in 2016. She joined İşbank in 1990
as Assistant Economics Specialist at
Economic Research Division and was
appointed as Assistant Manager in the
same division in 1998. Serving in the
Capital Markets Division after 2000, she
became Unit Manager in the same division
in 2004. She was appointed as Head of
the Economic Research Division in 2008
and started to serve as Chief Economist in
2018. She was appointed as Deputy Chief
Executive on March 25, 2022.
1971, Kars. Mr. Tufan Kurbanoğlu graduated
from the Public Administration Department
of Middle East Technical University, Faculty
of Economic and Administrative Sciences
and began his career as an Assistant
Inspector on the Board of Inspectors in
1993. Mr. Kurbanoğlu 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 and he was
appointed as the Deputy Chief Executive
on March 25, 2022.
1970, Bingöl. Mr. Mehmet Celayir
graduated from Istanbul University, Faculty
of Economics, Department of International
Relations. Mr. Celayir started his career as
an Officer at Elazığ Branch in 1996. After
serving in various positions in the Bank,
he was promoted to the Branch Manager
of Cizre/Şırnak Branch in 2004. He was
appointed as Assistant Regional Manager
of SME Loans Underwriting Division of
Diyarbakır Region in 2006 and Regional
Manager of the same division in 2009. He
then served as Branch Manager of Mersin
Commercial Branch, Head of Commercial
Banking Sales Division and Branch
Manager of Gaziantep Corporate Branch
in the respective order. Mr. Celayir was
appointed as Deputy Chief Executive on
December 14, 2022.
11
12
13
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SECRETARIAT TO
THE BOARD OF
DIRECTORS
BOARD OF
INSPECTORS
DEPUTY CHIEF
EXECUTIVE
Sezai Sevgin
INTERNAL
CONTROL
DIVISION
CORPORATE
COMPLIANCE
DIVISION
RISK
MANAGEMENT
DIVISION
HEAD OFFICE
COUNSELLORSHIP
DISASTER AND
EMERGENCY
COORDINATORSHIP
INFORMATION
SECURITY
COORDINATORSHIP
* As of 27.12.2023
BOARD OF DIRECTORS
CHIEF EXECUTIVE OFFICER
HAKAN ARAN
AUDIT COMMITTEE
GÜZİDE MELTEM KÖKDEN
SADRETTİN YURTSEVER
DEPUTY CHIEF
EXECUTIVE
DEPUTY CHIEF
EXECUTIVE
DEPUTY CHIEF
EXECUTIVE
DEPUTY CHIEF
EXECUTIVE
DEPUTY CHIEF
EXECUTIVE
DEPUTY CHIEF
EXECUTIVE
DEPUTY CHIEF
EXECUTIVE
DEPUTY CHIEF
EXECUTIVE
DEPUTY CHIEF
EXECUTIVE
DEPUTY CHIEF
EXECUTIVE
DEPUTY CHIEF
EXECUTIVE
N. Burak Seyrek
Ebru Özşuca
Sezgin Yılmaz
Ozan Gürsoy
Sabri Gökmenler
Sezgin Lüle
Can Yücel
Suat Sözen
İzlem Erdem
Tufan Kurbanoğlu
Mehmet Celayir
SUBSIDIARIES
DIVISION
TREASURY
DIVISION
SMES AND
BUSINESS BANKING
MARKETING
DIVISION
CORPORATE AND
COMMERCIAL
BANKING
MARKETING DIVISION
INFORMATION
TECHNOLOGIES
DIVISION
PERSONAL
BANKING
MARKETING
DIVISION
LOANS PORTFOLIO
MANAGEMENT
DIVISION
GENERAL
SECRETARIAT
FINANCIAL
MANAGEMENT
DIVISION
LEGAL AFFAIRS
AND FOLLOW UP
DIVISION
BANKING BASIC
OPERATIONS
DIVISION
CORPORATE
ARCHITECTURE
DIVISION
FINANCIAL
INSTITUTIONS
DIVISION
STRATEGY AND
CORPORATE
PERFORMANCE
DIVISION
CAPITAL MARKETS
DIVISION
SMES AND
BUSINESS
BANKING SALES
DIVISION
AGRICULTURAL
BANKING
MARKETING
DIVISION
COMMERCIAL
BANKING SALES
DIVISION
FREE ZONE
BRANCHES
COMMERCIAL
BANKING
PRODUCT
DIVISION
BRANCHES
ABROAD &
FOREIGN
REPRESENTATIVES
PURCHASING
DIVISION
PERSONAL
BANKING SALES
DIVISION
CORPORATE
LOANS
ALLOCATION
DIVISION
CORPORATE
COMMUNICATION
DIVISION
ECONOMIC
RESEARCH
DIVISION
LEGAL AFFAIRS
DIVISION
SUPPORT
SERVICES DIVISION
FINANCIAL LEGAL
AFFAIRS AND TAX
MANAGEMENT
DIVISION
NVESTOR
RELATIONS &
SUSTAINABILITY
DIVISION
MANAGERIAL
REPORTING
& INTERNAL
ACCOUNTING
DIVISION
LOANS
MONITORING
DIVISION
RETAIL LOANS
MONITORING
DIVISION
COMMERCIAL
& CORPORATE
LOANS
MONITORING
DIVISION
FOREIGN TRADE
& COMMERCIAL
LOAN OPERATIONS
DIVISION
HUMAN
RESOURCES
MANAGEMENT
DIVISION
CONSTRUCTON
& REAL ESTATE
MANAGEMENT
DIVISION
TALENT
MANAGEMENT
DIVISION
DATA
MANAGEMENT
DIVISION
PERSONAL
BANKING
PRODUCT
DIVISION
RETAIL LOANS
ALLOCATION
DIVISION
PRIVATE BANKING
MARKETING &
SALES DIVISION
PROJECT
FINANCING
DIVISION
COMMERCIAL
LOANS
COLLECTION
DIVISION
ARTIFICIAL
INTELLIGENCE
DIVISION
PERSONAL LOANS
DIVISION
DIGITAL BANKING
DIVISION
CUSTOMER
SERVICES DIVISION
PAYMENT
SYSTEMS
ECOSYSTEM
DIVISION
PAYMENT
SYSTEMS
OPERATIONS
DIVISION
PAYMENT
SYSTEMS
PRODUCT
DIVISION
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Meetings in 2023
At İşbank, the Board meetings are held at least once a month, but
interim meetings may be held if necessary. Meeting agendas are
prepared in accordance with the proposals of the Head Office
divisions. In addition, various reports requested by the Board of
Directors from the Bank’s management are discussed during the
meetings, as well as non-agenda items proposed by the Board
members. The agenda and related documents are distributed to the
members ahead of the meeting.
As of 2023, 15 Board of Directors meetings were held, and 15 of
these meetings were fully attended. 1.030 pages of minutes were
recorded for the said meetings, which lasted 45 hours in total. A
total of 159 files were reviewed, consisting of 130 files for loan
underwriting and 29 files for other issues related to loans, based on
the work carried out by convening meetings or by individual review
and signature of the file by each Board Member, which resulted in
115 loan decisions. A total of 437 files were reviewed on non-credit
matters, and 437 resolutions were taken. Consequently, 762 Board
resolutions were taken in 2023, including 210 that were passed
during the meetings.
İşbank Committees
Assessments on İşbank Committees
The Board of Directors has established several governance
committees in place to support the activities of the Board in various
areas of expertise. İşbank’s committees presented their decisions and
reports to the Board of Directors in 2023 as required within the scope
of their activities, and the necessary decisions were taken as a result
of the assessment of the Board of Directors.
Audit Committee
According to its operating principles, the Audit Committee is in
charge of holding meetings at least twice a year, provided that the
intervals do not exceed six months; the Committee is obliged to
inform the Board of Directors of the results of the activities carried
out and of the measures to be taken on the basis of these results, as
well as of the necessary practices to be implemented. Moreover, the
Audit Committee is required to make recommendations on any other
issues it deems important for the Bank to safely carry out its activities.
The Audit Committee works in collaboration with the Remuneration
Committee and the Risk Committee.
The Audit Committee is in charge of:
Ensuring that the Bank's internal systems function efficiently and
sufficiently, that these systems and the accounting and reporting
systems operate within the framework of the relevant regulations
and the Bank’s policies, and that the information produced has
integrity,
Carrying out 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, periodically evaluating them
in accordance with the provisions of the law, 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 internal audit functions of subsidiaries subject to
consolidation are coordinated in line with the relevant regulations,
Receiving information and reports about the internal systems and
the functioning of divisions within the scope of internal systems,
about their operations including consolidated risks, and about
related policies and regulations,
Preparing the Bank's financial reports in accordance with the
relevant legislation, regulations, and standards,
Making assessments to ensure whether 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
(İSEDES) includes all risks in a consolidated manner, and audit and
control processes are established to provide required assurance on
its adequacy and accuracy,
Evaluating the level of professional education and competence of
managers and personnel performing duties in the divisions within
the scope of internal systems, making suggestions to the Board
of Directors regarding 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 on the results of its own
operations, on the measures needed to be taken to ensure the
Bank’s operations continue to be carried out in a safe and sound
manner within the framework of the relevant legislation and Bank’s
policies, and on its evaluations, opinions, and recommendations on
any other issues that it deems important,
Fulfilling other responsibilities determined by the related legislation
and the duties given by the Board within this framework.
Committee Structure
Chairperson: Vice Chairperson of the Board of Directors Güzide
Meltem Kökden
Member: Board Member Sadrettin Yurtsever
In 2023, the Audit Committee held 55 meetings with the full
participation of its members and adopted 82 resolutions.
Credit Committee
The Credit Committee consists of three members: the Chief
Executive Officer or the Deputy Chief Executive, who is also the
chairperson of the Committee, and two members of the Board of
Directors. In addition, two additional Committee members who will
stand in if necessary.
The Credit Committee decides on loan allocation within its
authorization limit, on demands to change the terms of loan allocation
within its authorization limit, and carries out other duties given by the
Board related to loans.
When the loan proposal files are submitted, the Credit Committee
acts by consensus on the loan allocation after each Member
has reviewed and signed the files. Unanimous Credit Committee
resolutions are implemented immediately, while majority resolutions
are implemented after approval by the Board of Directors.
TRNC Internal Systems Committee
Committee Structure
Chairperson of the Committee and Regular Member: Chief
Executive Officer Hakan Aran
Member: Chairperson of the Board of Directors Adnan Bali
Member: Board Member Şebnem Aydın
Alternate Member: Vice Chairperson of the Board of Directors
Güzide Meltem Kökden
Alternate Member: Board Member Fazlı Bulut
In 2023, 70 files under the authority of the Credit Committee were
evaluated, and 55 resolutions were adopted with the full participation
of the members.
The 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 the
intervals do not exceed six months; the Committee is obliged to
inform the Board of Directors of the results of the activities carried out
and of the measures to be taken on the basis of these results, as well
as of 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 in charge of ensuring the
efficiency and sufficiency of the internal systems provided by the
Bank in relation to the operation of the branches under the TRNC
office, ensuring the operation of the internal systems, accounting,
and reporting systems in accordance with the law and related
regulations, ensuring the integrity of the produced information,
carrying out preliminary assessment of independent audit firms and
other companies providing services directly related to other banking
operations to be selected by the Board, and regularly monitoring and
coordinating these companies that are selected and contracted by
the Board.
Committee Structure
Chairperson: Vice Chairperson of the Board of Directors Güzide
Meltem Kökden
Member: Board Member Sadrettin Yurtsever
In 2023, the TRNC Internal Systems Committee held 10 meetings
with the full participation of its members and adopted 11 resolutions.
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Risk Committee
Committee Structure
Credit Revision Committee
In accordance with the Bank's Credit Risk Policy, the Credit Revision
Committee is established at the end of each year. Its purpose is
to evaluate the Bank's relationships with its credit customers by
reviewing the commercial loan portfolio and deciding on the limits
to be applied to the aforementioned persons and institutions in the
upcoming year.
Committee Structure
Member: Chairperson of the Board of Directors Adnan Bali
Member: Vice Chairperson of the Board of Directors Güzide Meltem
Kökden
Member: Board Member Sadrettin Yurtsever
Member: Board Member Şebnem Aydın
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 30.03.2023.
Corporate Governance Committee
The Corporate Governance Committee, consisting of a chairman and
four members, is in charge of monitoring the Bank’s compliance with
corporate governance principles, making improvements in corporate
governance practices and suggestions to the Board, and carrying out
the duties of the Corporate Governance Committee and Nomination
Committee as set out in the applicable legislation. The Committee
is also the highest authority in charge of the Bank's sustainability
activities.
Committee Structure
Chairperson: Board Member Sadrettin Yurtsever
Member: Board Member Fazlı Bulut
Member: Board Member Şebnem Aydın
Member: Investor Relations and Sustainability Division Manager
Nilgün Yosef Osman
Chairperson: Chairperson of the Board of Directors Adnan Bali
Members: Board Members Şebnem Aydın and Sadrettin Yurtsever;
Executive Committee Members İzlem Erdem, N. Burak Seyrek, Can
Yücel, Ozan Gürsoy, Sezgin Yılmaz, Sezgin Lüle, Mehmet Celayir,
Sabri Gökmenler, Sezai Sevgin, Suat E. Sözen, Hürdoğan Irmak, Nilgün
Yosef Osman
As of year-end 2023, the Sustainability Committee held 2 meetings
once with the full participation of the members and once with one
less member and adopted 4 resolutions.
Remuneration Committee
The Remuneration Committee was formed to perform functions
and activities related to monitoring and controlling the Bank’s
remuneration policies on behalf of the Board of Directors. The
Committee has two members. The Remuneration Committee
convenes at least twice a year, with a gap of no more than six months
between the meetings, and submits to the Board of Directors the
results of its activities as well as its opinions on other issues it deems
important.
Within the framework of compliance to Corporate Governance
Principles, the Remuneration Committee is in charge of monitoring
and checking remuneration management policies on behalf of the
Board of Directors, as well as ensuring that remuneration is complying
with the Bank's ethical values, internal balances, and strategic goals.
The Committee is also in charge of evaluating remuneration policy
and practices within the risk management framework, reviewing
the remuneration policy, and submitting proposals as required to
the Board of Directors, as well as carrying out other responsibilities
outlined in applicable legislation and the tasks assigned to it by the
Board of Directors within this framework.
Committee Structure
Chairperson: Chairperson of the Board of Directors Adnan Bali
Member: Board Member Sadrettin Yurtsever
Member: Investor Relations and Sustainability Division Unit Manager
Özge Han Mercimekçi
In 2023, the Remuneration Committee held 11 meetings with the full
participation of its members and adopted 14 resolutions.
In 2023, the Corporate Governance Committee held 3 meetings with
the full participation of its members and took 3 decisions.
Sustainability Committee
The Sustainability Committee was formed to develop the Bank's
sustainability strategy and policies and submit them to the Board
of Directors for approval, to establish sustainability targets and
action plans and ensure coordination within the Bank for their
implementation, to ensure that sustainability issues are incorporated
into the Bank's strategic business plans, to track the progress
of the metrics and targets, and to perform other similar tasks.
The Committee is the highest authority in charge of the Bank’s
sustainability activities.
Board of Directors Operating Principles Committee
The Board of Directors Operating Principles Committee is in charge
of 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 Structure
Chairperson: Chairperson of the Board of Directors Adnan Bali
Member: Board Member Durmuş Öztek
Member: Board Member Sadrettin Yurtsever
Chairperson: Chairperson of the Board of Directors Adnan Bali
Member: Vice Chairperson of the Board of Directors Güzide Meltem
Kökden
Member: Board Member Sadrettin Yurtsever
Member: Chief Executive Officer Hakan Aran
Member: Deputy Chief Executive Sezai Sevgin
Member: Deputy Chief Executive Ebru Özşuca
Member: Deputy Chief Executive İzlem Erdem
Member: Deputy Chief Executive Can Yücel
Member: Risk Management Division Manager Hürdoğan Irmak
Member: Internal Control Division Manager Engin Yalçın
Member: Corporate Compliance Division Manager Süleyman H.
Özcan
In 12 meetings held by the Risk Committee in 2023, the risk
management activities of İşbank and its subsidiaries under the
Consolidated Risk Policies were evaluated, the risk reports presented
to the Committee were reviewed, and 28 decisions were made
regarding the risk management systems and processes.
Operational Risk Committee
The Operational Risk Committee, which was formed to determine the
strategies and policies for managing operational risks that the Bank
may face, improve the operational risk management framework, and
strengthen the governance model for operational risks, convenes
at least twice a year. The Committee collaborates with the Risk
Committee and reports operational outcomes to the Board via the
Audit Committee.
The Risk Committee prepares risk management strategies
and policies for İşbank, both consolidated and unconsolidated,
submits them to the Board of Directors for approval, and oversees
their implementation. The Committee serves as a common
communication platform for the Bank's Executive divisions to assess
the risks to which the Bank is exposed, makes suggestions on actions
to be taken, and approaches to be followed.
The Risk Committee continues its activities by being responsible for:
Preparing risk strategies and policies and submitting them to the
Board for approval,
Evaluating the outputs of the İSEDES and the Action Plan, which are
created at least on an annual basis, and presenting the evaluation
results to the Board of Directors via the Audit Committee,
Evaluating the determination of corporate crisis levels on Action
Plan indicator violations and reporting the evaluation results to the
Board of Directors via the Audit Committee,
Monitoring the effective use of the outputs of the internal capital
adequacy assessment process in the planning and decision-
making processes of the Bank,
Discussing and deciding on issues raised by the Risk Management
Division to the attention of the Committee,
Recommending the risk level limits for exposures/possible
exposures to the Board, monitoring their violations, and making
recommendations to the Board to eliminate them,
Recommending changes in the risk policies to the Board,
Monitoring the risk management processes, i.e. risk identification,
definition, measurement, assessment, control, and reporting
processes carried out by the Risk Management Division,
Monitoring the accuracy and reliability of the risk measurement
methodologies and their results,
Making proposals to the Board regarding articulation and
amendment of the Bank's risk appetite statement,
Taking measures to establish a risk culture in the Bank, developing
supervisory processes, understanding all of the risks arising from
the activities of the Bank, and supervising their integration into the
Bank’s risk management system.
The Risk Committee also contributes to the development of group
risk policies through consolidated group meetings that include
the Bank's financial and non-financial subsidiaries. Consolidated
sessions are organized quarterly. Burak Seyrek, the Deputy General
Manager responsible for the Subsidiaries Division, and Murat Doğan,
the Division Manager, also attend the consolidated activities of the
Risk Committee.
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Chairperson: Vice Chairperson of the Board of Directors Güzide
Meltem Kökden
Member: Board Member Sadrettin Yurtsever
Member: Chief Executive Officer Hakan Aran
Member: Deputy Chief Executive Sabri Gökmenler
Member: Deputy Chief Executive Burak Seyrek
Member: Deputy Chief Executive Sezgin Lüle
Member: Deputy Chief Executive Mehmet Celayir
Member: Deputy Chief Executive Sezai Sevgin
Member: Chairperson of the Board of Inspectors Gürler Özkök
Member: Internal Control Division Manager Engin Yalçın
Member: Corporate Compliance Division Manager Süleyman H.
Özcan
Member: Risk Management Division Manager Hürdoğan Irmak
Member: Information Security Division Manager Bülent Akdemir
Member: Risk Management Division Operational Risk Unit Manager
Burcu Nasuhoğlu
In 2023, the Operational Risk Committee held 3 meetings with the
participation of all members and adopted 4 resolutions.
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 Committee is made up of 50% non-executive
managers and 12.5% independent members.
Committee Structure
Member: Board Member Şebnem Aydın
Member: Board Member Fazlı Bulut
Member: Board Member Durmuş Öztek
Member: Board Member Sadrettin Yurtsever
Member: Deputy Chief Executive Sezgin Yılmaz
Member: Deputy Chief Executive Can Yücel
Member: Deputy Chief Executive Suat E. Sözen
Member: Head of the Corporate Communications Division Gül
Meltem Atılgan
In 2023, 16 positive decisions were taken in 5 meetings held with the
participation of all members of the Corporate Social Responsibility
Committee.
Committee Name
Number of Members
Number of Meetings
Number of Decisions Taken
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
2
2
5
5
5
15
2
3
11
14
8
55
10
70 (number of files)
6
3
2
11
0
12
3
6
82
11
55
0
3
4
14
0
28
4
9
Information on Risk Management
Policies Applied per Risk Types
In addition to banking activities, the financial and non-financial risks to
which the Group is exposed must be analyzed as a whole, monitored,
and reported in accordance with banking-specific risk management
principles and the Group's risk management perspective. This is
more than just a legal reporting requirement that must be met; it has
become the industry standard for corporate governance.
The Bank's risk management process, which is organized around
risk management regulations and helps to establish a common risk
culture throughout the organization, is designed to prioritize "good
corporate governance", ensure the separation of risk monitoring and
controlling units from executive functions, identify risks in accordance
with international regulations, and facilitate measurement, analysis,
monitoring, reporting, and control functions.
The Board of Directors’ main responsibilities include the risk
management process and the functions that comprise it. The Risk
Management Division, which acts through the Risk Committee and
is a functional component of the risk management function, not
only carries out regulatory and internal capital adequacy activities
to ensure compliance with the Basel framework and international
best practices, but also develops and validates risk measurement
methodologies and optimizes the capital adequacy management
process.
Capital Adequacy Policy
The Capital Adequacy Policy sets out the principles and procedures
that need to be followed when defining the level of capital, both
consolidated and unconsolidated, that the Bank must hold against
potential losses that could arise from financial risks associated with
both on- and off-balance sheet items, in addition to non-financial
risks resulting from the Bank’s operations. It also specifies how that
level of capital is maintained and monitored, taking into consideration
the minimum capital levels determined in accordance with the
regulations and the internal capital adequacy assessment process.
Credit Risk Policy
Credit risk is defined as the likelihood that the Bank would incur
losses due to a counterparty’s failure to complete its obligations
under an agreement with the Bank in a timely manner, whether
partially or entirely. The Credit Risk Policy sets the methodology and
responsibility for managing, controlling, and monitoring credit risk as
well as other factors related to credit risk limits.
İşbank identifies, measures, and manages credit risks throughout
its products and activities, taking into account the transactions
defined as credit in Article 48 of the Banking Law. The Board of
Directors reviews the Bank's credit risk policies and strategies at
least once a year. The General Manager, Deputy General Managers,
and the Division Managers involved in loan processes are in charge
of carrying out the credit risk policies as approved by the Board of
Directors.
İşbank's credit risk profile is regularly monitored. Current risk
indicator trends and changes are reported to senior management
at regular intervals. Concentration of credit risks must be avoided.
Its concentration in the credit portfolio monitored by ensuring a
balanced combination of revenue, risk, and capital cost. For this
purpose, the Board of Directors adheres to credit risk limits, which
can be defined for each debtor, sector, loan type, collateral, country,
maturity, and currency.
In addition to the credit risk limits required by legal law, İşbank
manages credit risk by implementing internal risk limits set by the
Board of Directors. These limits restrict the maximum credit risk
that the Bank can undertake depending on parameters such as risk
groups and sectors. The method used to estimate these internal limits
does not lead to credit risks concentration.
The Bank also uses credit decision support system tools to manage
credit risk. The Bank ensures that the credit decision support systems
and artificial intelligence applications can monitor credit risks on a
portfolio basis, calculate unexpected losses, and accurately evaluate
credit risk in pricing, performance management, sales, and marketing
processes. The risks that the Bank may face in connection with any
models in use are assessed and managed according to the principles
and procedures outlined in the Model Risk Management Policy.
Asset and Liability Management Risk Policy
Asset-liability management risk is defined as the risk that the Bank
would incur losses as a result of failing to effectively manage all
financial risks associated with its assets, liabilities, and off-balance
sheet transactions. Asset and liability management risk covers the
market risk in the trading portfolio, structural interest rate risk of the
banking portfolio, and liquidity risk.
The Board of Directors establishes all principles and procedures
for creating and managing the Bank's asset-liability structure, as
well as the "Risk Appetite Framework" for the capital allocation. The
top priority is to keep the asset-liability management risk within the
limits set out in the legislation and the internal risk limits. Within the
Bank's risk appetite framework, the Board of Directors determines
risk tolerance levels for each risk type on both a bank-only and
consolidated basis, with the goal of limiting the amount of risk
absorbed by the Bank . This process considers liquidity, target income
level, and general risk factor expectations.
The Board of Directors and Audit Committee have to monitor and
ensure best use of the Bank's capital. Therefore, they are in charge of
checking the risks against the limits and taking appropriate actions.
The Asset-Liability Management Committee manages asset-
liability risk in accordance with the Board of Directors' risk appetite
framework and risk limits, as well as the principles and procedures set
out in the policy.
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liability management risk, reporting the results, and monitoring
compliance with risk limits. The severity of the risk is assessed based
on various scenarios. Measurement results are tested to ensure their
reliability and integrity. Asset-liability management risk is reported
to both the Risk Committee and the Board of Directors via the Audit
Committee.
The Risk Management Division, Asset-Liability Management
Committee, and related executive units closely and continuously
monitor compliance with risk limits . If the limits are exceeded, the
Risk Management Division immediately reports the breach and its
causes to the Board of Directors via the Audit Committee. The Board
of Directors determines the course of action necessary to eliminate
the breach.
The internal audit system audits asset-liability management
processes and policy rule compliance. The Board of Directors
establishes the principles that govern the audit process, audit reports,
and implementation of action plans to eliminate the errors and gaps
discovered during audits.
Stress Testing Policy
The Stress Testing Policy is intended to identify major risks and
vulnerabilities that may occur as a result of both Bank-specific
negative developments and unanticipated stress conditions
associated with the general economic and financial environment.
The stress test program is described as a collection of stress test
analyses performed to assess risks associated with the Bank’s
activities, as well as the methodologies, assumptions, and scenarios
used in these analyses. To ensure that valid and accurate results are
obtained, the stress test program is regularly monitored and updated
based on the Bank’s risk appetite framework, the current economic
environment, and market conditions, as well as the Bank’s products,
strategies, and technological capabilities.
In accordance with the regulations and its internal procedures, the
Bank implements a stress test program to assess the risks from both
a holistic view (i.e. bank-wide stress tests) and on the basis of the
major risk types (i.e. individual stress tests). The results are reported to
senior management, the Board of Directors, and other relevant legal
authorities.
The Board of Directors is in charge of executing the stress test
program in its entirety. The Board of Directors ensures that the
stress test program’s outcomes are evaluated and used as inputs in
making decisions in pertinent fields. The Risk Management Division
is in charge of conducting the analyses included in the stress test
program, reporting the outcomes of the stress tests, and ensuring
compliance with the risk limits. The Risk Committee determines the
scope of the stress test program, the risk factors to be included in the
analyses, and the framework for stress parameters.
The internal audit system audits processes related to the stress
test program as well as compliance with policy rules. The Board of
Directors establishes the principles that govern the audit process,
audit reports, and implementation of action plans to eliminate the
errors and gaps discovered during audits.
Employees of the Bank act responsibly and understand that the
principles and procedures laid out in the Bank's legislation, especially
the operational risk policy, are intended to create a work environment
that is sensitive to the presence of operational risks and reduces the
likelihood of loss by incorporating control mechanisms for such risks.
Operational Risk Policy
Reputational Risk Policy
Operational risk is defined as "the risk of loss, including legal risks,
due to inadequate or faulty internal processes, people and systems or
external factors". The Risk Management Division handles all central
risk management activities related to the subject. These activities
include detecting, identifying, measuring, analyzing, monitoring,
reporting, and controlling operational risks; following national
and international developments in operational risk management;
improving existing techniques and methods; and performing the
necessary regulatory reporting, notification, and follow-up. The
Operational Risk Policy establishes the principles, procedures, and
responsibilities of operational risk management.
Operational risks that may arise during activities are classified and
monitored under the "Risk Catalog”. The Risk Catalog serves as the
main document for identifying and classifying all potential risks. It is
updated to reflect better risk management practices and changing
regulations.
Operational risk is managed using a triple defense line approach
within the framework of the Board’s approved risk management
policies. Risk appetite and its internal limits for operational risks, as set
by the Board, are regularly monitored.
When identifying operational risks, both internal and external factors
that might negatively impact the Bank's operations are considered.
Both qualitative and quantitative methods are used to measure and
assess operational risks. During measurement and assessment,
risks are prioritized based on their financial, legal, reputational, and
operational implications for the Bank. Besides the calculations
required by the law, internal measurement methods, impact-
probability analysis, loss event data analysis, scenario analysis,
stress tests, and risk indicators are also used to measure operational
risks. The results are reported to the Board via the Operational Risk
Committee and Risk Committee.
The Risk Management Division regularly monitors and reports to the
Risk Committee, Operational Risk Committee, and the Board on all
operational risks that the Bank may face in connection with banking
and information systems processes; risk levels of new products,
services, and activities, as well as the support and valuation services
that the Bank receives; loss events occurring at the Bank that
represent operational risks, and risk indicators.
Reputational risk is defined as potential losses that 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 Reputational Risk Policy sets out
the principles and procedures to be followed when identifying,
assessing, controlling, monitoring, reporting, and managing sources of
reputational risk that the Bank may face during its operations.
Sources of reputational risk are evaluated individually and collectively,
and appropriate systems and controls are implemented to effectively
manage risk factors. The Risk Management Division is in charge of
conducting a multi-dimensional assessment of reputational risks and
reporting the results to the Risk Committee, the Audit Committee,
and the Board of Directors. All employees carry out their duties in a
responsible manner, protecting the Bank’s reputation.
Consolidated Risk Policies
The Consolidated Risk Policies oversee compliance with risk
management principles for the Bank's subsidiaries. Subsidiaries
follow their own risk management policies which consider the
Consolidated Risk Policies and their own organizational structure. The
subsidiaries' risk policies, which have been approved by their boards
of directors, serve as the basis for their risk management systems
and processes. The Risk Management Division regularly and closely
monitors the risk levels of the subsidiaries and provides periodical
reports to the Risk Committee and the Board.
Information Systems Risk Policy
The Information Systems Risk Policy aims to set out the principles
to be adhered to for identifying, measuring, monitoring, controlling,
reporting, and managing the risks associated with the information
system management. With this policy, the Bank aims to effectively
manage its information systems, which are vital in sustaining
the Bank's activities, by incorporating the information system
management into its corporate risk management practices. The
provisions of this policy apply to the management of the Bank's
information systems and all elements associated with these systems.
The risks associated with information technologies are basically
evaluated as part of the Bank's operational risk management. Since
these risks can amplify the other risks arising from banking activities,
it is essential that the Bank measures, closely monitors, and controls
them within a holistic risk management approach.
Model Risk Management Policy
The purpose of the Model Risk Management Policy is to set the
principles and procedures for model risk management principles
by addressing the whole lifespan of the models used by the Bank
in its operations. With the policy, the Bank aims to manage, through
a holistic approach, the model risk to which the models used by
the Bank in its activities are exposed owing to errors, failures, or
shortcomings in the lifecycle of the models.
The Bank manages model risk using a triple defense line
structure, with the model owner, model development team, model
implementation team, and model user providing the first line of
defense, the model risk management team, validation team, and
internal control providing the second line of defense, and the internal
audit providing the third line of defense. Model risk management
covers the entire lifecycle of a model. The policy describes the
primary tasks in each step of the model lifecycle, as well as the
responsibilities of the Bank’s various divisions in relation to these
tasks.
Climate Change Risk Policy
Climate change risk comprises both the risks of transitioning to a low-
carbon economy and physical risks that may arise as a result of the
impact of climate change on nature. The Climate Change Risk Policy
sets out the principles and procedures for detecting, identifying,
assessing, and/or measuring, monitoring, controlling, reporting, and
managing climate change risks that the Bank may face as a result of
its activities.
Aside from being a type of risk which the Bank may directly face,
other risks that may arise during the performance of the Bank's
activities may cause climate change risks. Therefore, the 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
that the Bank's activities and practices are in line with its climate
change strategy. Responsibility for managing climate change risks
has been defined as a triple defense line. In basic terms, the role of
the first line of defense is to identify, assess, and control the climate
change risks that may affect the branches of activity for which they
are responsible, as well as ensure that loan decisions are made while
considering these risks during the lending process. The second
line of defense determines the operating principles, rules, policies,
and requirements in response to climate change risk. The third line
of defense, within its current roles and responsibilities, reassures
the Board of Directors that the structure described here functions
properly.
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Good Corporate CitizenLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Managers of Internal Systems
Second Line of Defense:
Name
Sezai Sevgin
Hürdoğan Irmak
Süleyman H. Özcan
Engin Yalçın
Duty
Deputy Chief
Executive Responsible
for Internal Systems:
Manager of the
Risk Management
Division
Manager of
the Corporate
Compliance Division
Internal Control
Division Manager
Term of Office
Professional
Experience
Divisions
Previously Served
Educational Status
2 years 2 months
6 years 2 months
3 years 6 months
1 year 2 months
34 years
23 years
30 years
27 years
Board of Inspectors,
İşbank AG
Corporate Marketing
Division
Commercial Banking
Marketing Division
Gebze Corporate Branch
Maslak Corporate Branch
Bayındır Health Group
Corporate Loans
Underwriting Division
Board of Inspectors
Risk Management
Division
Board of Inspectors,
Accounting Department,
Board of Change
Management,
Strategy and Corporate
Performance
Management Division,
Investor Relations Division
Board of Inspectors,
Payment Systems
Product Division,
Deputy Chairperson of
the Board of Inspectors,
İş Merkezleri Yönetim ve
İletişim A.Ş.
Bachelor’s Degree
Bachelor’s Degree
Bachelor’s Degree
Bachelor’s Degree
Third Line of Defense:
Name
Duty
Term of Office
Professional
Experience
Divisions
Previously Served
Educational
Status
Gürler Özkök
Chairperson of the
Board of Inspectors
2 years
30 years
Postgraduate
Degree Abroad
Risk Management
Department,
Deputy
Chairperson
of the Board of
Inspectors,
Izmir Branch,
Izmir Commercial
Branch,
Akdeniz Corporate
and Maslak
Corporate
Branches
Audit Committee’s Assessment on the Operation
of Internal Audit, Internal Control, Compliance, and
Risk Management Systems, and Information on its
Activities in the Reporting Period
Internal Audit
The Board of Inspectors reports to the Board of Directors of İşbank
and audits the Bank’s Head Office divisions, banking processes,
information systems, domestic and foreign branches, and the
activities of consolidated subsidiaries, as well as support service
organizations. The audits aim assure that the Bank’s activities
comply with legal regulations and the Bank’s strategies, policies,
principles, and goals. The work done prioritizes the assessment of the
effectiveness of the processes for identifying risks and developing the
necessary controls within the activities of the first and second lines of
defense. Audits are conducted on-site or remotely in accordance with
national and international quality standards, based on business needs
through an agile working methodology, using a modern and risk-
focused approach that uses 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 suspected internal crimes.
Furthermore, the Board of Inspectors audits customer complaint
management, and customer complaints received directly by the
Board of Inspectors through various channels, including the Ethics
Line, are inspected on an individual basis.
The audit reports prepared as a result of the inspection activities are
reported to senior management and relevant divisions via the Audit
Committee, and the Board of Inspectors monitors the measures taken
to address the findings. The Board of Directors closely monitors the
activities of the Board of Inspectors through monthly activity reports
submitted via the Audit Committee.
The Board of Inspectors conducts annual risk-based audits of
İşbank’s banking processes and information systems 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, the Board of Inspectors reviews
both the consolidated and unconsolidated financial statements
prepared during the audit of the financial reporting processes within
routine banking processes. In addition, during the regular audits of
subsidiaries, the financial reports presented by the related companies
to the Bank are reviewed in accordance legal regulations and basic
accounting principles such as accuracy and completeness.
The Board of Inspectors also audits customer complaint
management, and customer complaints received directly by the
Board of Inspectors through various channels, including the Ethics
Line, are inspected on an individual basis.
In 2023, audits were conducted in domestic and foreign branches,
Head Office Divisions and Units, and subsidiaries.
The following audits were also conducted:
Portfolio Custody Service,
Sustainability Management System,
Gender Equality in Remuneration,
The Bank and Türkiye İş Bankası A.Ş. Group Compliance Program
on Prevention of Laundering Proceeds of Crime and the Financing
of Terrorism,
Valuation Services Received by İşbank,
Internal Capital Adequacy Assessment Process (İSEDES),
Compliance with the Guidelines on Loan Allocation and Monitoring
Processes.
The Bank’s loans to the top 400 companies with the highest credit
risk, which constitute 44% of the Bank’s total loans, were also audited.
Compliance
At all levels of the Bank, compliance is the primary duty and
responsibility of all managers and employees. The Corporate
Compliance Division, which reports to the Board of Directors,
monitors the corporate compliance functions and activities carried
out in the Bank's Head Office divisions, domestic and overseas
branches, and its subsidiaries through corporate compliance
activities. The Corporate Compliance Division’s goal is to ensure
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 that the Bank's activities are
conducted and managed in accordance with applicable laws,
regulations, and standards at all times. The Bank also oversees the
effective implementation of the corporate compliance activities by its
subsidiaries.
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Good Corporate CitizenLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report The Corporate Compliance Division, which consists of three sub-
units, namely Regulatory Compliance, Fiscal Crimes, and Sanctions
and International Obligations, carries out the necessary research,
analysis, monitoring, assessment, information, implementation,
coordination, and reporting activities regarding compliance issues
and monthly and annually reports the results of these activities to the
Board of Directors via the Audit Committee.
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 the
Bank as well. The Corporate Compliance Division Manager is also
a member of the Risk Committee and Operational Risk Committee
and a consultant member of the Information Systems (BS) Steering
Committee, Business and BS Continuity Committee, Information
Security Committee, and Information Sharing Committee. The
Head of the Corporate Compliance Division also serves as the
"Compliance Officer" of the Financial Group, of which the Bank is the
parent company, in accordance with the MASAK (Financial Crimes
Investigation Board) regulations.
The activities related to the prevention of fiscal crimes and sanctions
in our Bank are executed in a targeted and effective manner in
accordance with applicable regulations and the Bank’s Policy and
Compliance Program developed for this purpose.
Officers and Assistant Specialists who have just joined İşbank,
as well as employees who are promoted, receive a “Compliance
with Combating Financial Crimes and Sanctions Policy Program”
training as part of their career training program. Also, the Corporate
Compliance Division shares information on Financial Crimes,
Sanctions, International Obligations, and Legal Compliance activities
as part of the Career as a Specialist Internship Program, which is
designed to support the career development of our Senior Assistant
Specialists. In addition to these trainings, an e-training titled
“Combating Financial Crimes and Compliance Programme with
Sanctions Policy” is provided to all employees whose duties at the
Bank require them to be knowledgeable in this area. Furthermore,
lectures on International Sanctions are given to the members of
the Board of Inspectors in career training programs as part of the
orientation training provided to employees of overseas organizations.
The "International Sanctions" digital training course, designed to
familiarize employees with the concept of sanctions, the framework
of international sanctions, measures to be taken to avoid sanction
violations, and various checkpoints, was made available on
09.11.2023, and 230 employees completed the course.
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 providers, various authorities, or
other institutions.
The Compliance Risk Management Policy and Combating
Financial Crimes and Sanctions Policy are available in the “Investor
Relations/Corporate Governance” section of our website.
Internal Control
The main objective of the internal control system is to provide the
greatest contribution to achieving the Bank’s corporate targets, which
are set in accordance with the Bank’s vision, mission, and strategies,
as well as stakeholder expectations. To this end, under the direction
of the Board of Directors and with the contribution and support of all
İşbank employees the performance necessary to ensure that every
internal control system component functions in an integrated and
effective manner is being meticulously carried out with professional
care and attention.
The structure and operation of İşbank’s internal control system and
internal control activities ensure that the Bank’s assets are protected,
that its activities comply with the Law and other relevant legislations,
the its internal policies, guidelines, and banking practices, accounting
and financial reporting systems operate securely and with integrity,
and information is delivered on time. With the use of advanced
data analytics tools, the effectiveness of controls is centrally and
continuously monitored.
The Internal Control Division, which is an independent function,
regularly examines the design and operational effectiveness of the
internal control activities carried out by the relevant units. Accordingly,
the Internal Control Division carries out “on-site” and/or “remote”
controls using 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, that are going to be consolidated.
The Internal Control Division analyses the results of the reviews,
eliminates existing shortcomings, develops suggestions to prevent
the recurrence of errors, and monitors and tracks activities and
reports them to the Audit Committee on a monthly basis.
The internal control activities implemented in 2023 to ensure the
effective, reliable, and continuous execution of the Bank’s activities
and services, as well as the integrity, consistency, reliability, timeliness,
and security of the information provided by the accounting and
financial reporting system were found to be substantially disrupt-free.
In accordance with the Bank’s Sustainability Policy, controls regarding
the operations carried out within the scope of the Sustainability
Management System are also performed. In addition, the Bank
adheres to the international ISO 14001 Environmental Management
System standards in terms of the assessment and management of
environmental impacts, and the Internal Control Division carries out
the “internal audit” activities defined within the standard.
İşbank provides various trainings to its internal control personnel in
order to contribute to their professional development. The Internal
Control Division also supports these trainings to increase awareness
on internal control activities across the organization. The “Internal
Control - Basic Concepts” digital training, explaining the concept
of internal control, the scope of control processes, and the possible
consequences of lack of control, was prepared in 2023, uploaded to
the Bank's digital learning platform, and made available to employees.
Efficient Risk Management
The Bank's risk management process is organized around risk
management regulations and helps establish a common risk culture
across the organization. It prioritizes "good corporate governance",
ensures 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 which the Bank may face are managed with a triple defense
line. The first line of defense is comprised of the executive units and
is in charge of identifying and assessing risks, ensuring continuous
implementation of risk management, designing and implementing
process controls, and reporting results in line with 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 in charge
of creating and updating risk policies and the risk catalogue, setting
and updating control targets for 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 in charge of
conducting an independent audit of the risk management framework
and control systems to ensure their effectiveness and adequacy.
The Risk Committee was established to share risk management
principles within the Bank so that they are reflected in decision-
making and implementation processes. The Committee is in charge
of articulating the Bank’s risk management strategies and policies
, both on a consolidated and unconsolidated basis, submitting
them to the Board of Directors for approval, and monitoring their
implementation. The Operational Risk Committee, on the other
hand, improves the operational risk management framework and
strengthens the governance model regarding operational risks.
The Bank's risk management practices aim 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. Besides compliance
with regulatory limits, the Bank also ensures capital and liquidity
adequacy against all risks assumed by the Bank as part of the
Internal Capital Adequacy Assessment Process.
The Risk Management Division is the Bank’s main executing body
of central risk management activities, 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 Management,
Climate Change Risk, Stress Testing, Reputational Risk, Consolidated
Risk, and Information Systems Management Policies.
Potential risks that may be encountered during activities are defined
and classified in the Bank’s "Risk Catalog", where risks are divided
into two main groups: financial and non-financial risks. Financial and
non-financial risks are reported monthly to the Risk Committee and
the Board of Directors via the Audit Committee.
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Good Corporate CitizenLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report The Bank uses impact-probability analysis, loss event data
analysis, scenario analysis, stress testing, and risk indicators in the
measurements related to operational risks in addition to the risk
prioritization. The risks defined in the Risk Catalog, as well as the
management principles detailed in the risk policies, are reviewed at
least once a year, and the corresponding definitions and principles
are kept current.
To manage the Bank's risk profile and conduct a prospective
assessment, the scenario analysis method is used to assess the
impact of potential large-scale operational risk-type loss events on
the Bank's risk profile. The scenario analysis allows for assessment
of catastrophic events, also known as tail risks, which occur seldom
but have a significant impact when they do. Scenario analysis results
provide inputs to the operational risk management stress testing and
top-down risk assessment studies, as well as operational risk internal
capital requirement.
Various training programs are organized to extend the effective risk
management approach throughout the entire Bank, increase risk
management skills of employees, and raise their awareness on the
subject. Employees who take on the role of Branch Manager for
the first time receive holistic information on risk management, risk
types, and the Bank's Risk Catalog as part of the Branch Managers
Development Program. And, in the “Environmental and Social Risk
Management in Loans” training, information on the importance of
environmental and social risk management for the financial sector,
local legislation and international standards, and basic information on
environmental and social risk assessment processes are shared. As
of 2021, the Bank provides the digital training called “Risk Culture in
Our Bank”. In addition, the “Credit and Risk Management Academy”
was established to increase the knowledge level of employees who
plan to work in the risk management area of lending processes in
2023 and to contribute to their onboarding processes. Employees
were granted online access to the first training module which focuses
on basic concepts such as risk and loan relationship, financial risks,
and internal systems regulation. Furthermore, risk culture surveys are
conducted to investigate employees' awareness of risk culture.
Management of Non-Financial Risks
Aside from financial risks, non-financial risks such as climate change
risks, environmental management risks, internal behaviour/culture
and ethics risks, and employee practice and employee relations risks
are defined in the Bank's Risk Catalog and addressed through risk
management activities.
İşbank prioritizes using best practices to manage climate change
risks. The Bank carries out project activities aimed at measuring
and reporting on the climate change risks which it may be face,
developing governance principles and procedures, and integrating
such risks into the Bank's strategy and lending processes. Climate
change risk, classified as a strategic risk in the Bank's risk catalog,
is defined and exemplified using TCFD and international best
practices, which include transition risks and physical risks. The Board
of Directors approved and implemented the Climate Change Risk
Policy , which 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 face in connection with its activities. The "Share of
Sectors With High Climate Change Risk Within the 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 portfolio composition in future
periods.
The Bank uses a scenario approach to measure climate change risks.
For high-risk sectors identified using the climate change heat map
method, an impact analysis for climate risk events is carried out using
the United Nations Environment Program - Finance Initiative (UNEP-
FI) scenario analysis approach and NGFS reference scenarios.
Reputational risk refers to potential losses that may result from a 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
held by parties such as current or potential customers, partners,
competitors, and supervisory authorities. The Bank monitors
reputational risk using the Reputation Index. The Bank designed this
index to serve as an early warning system for aspects that might have
an impact on the Bank's reputation. Senior management receives
assessment reports on the level of reputational risk at least once
a quarter. Senior management is responsible for monitoring and
improving compliance with the corporate governance concept, which
underpins reputational risk.
Non Financial Risks
Risks Related to Climate Change
Risk
Operational
Risk
Reputational
Risk
Strategic
Risk
Transition
Risks
Transaction,
Process and
Product Risk
Human
Resources
Risk
Physical
Damage
Risk
Information
Technologies
Risks and
Cyber Risks
Fraud Risk
Financial
Crime Risk
Conduct
Risk
Compliance
Risk
Model
Risk
Macro
economic/
Systemic
Risks
Insurance
Risk
Business
Strategy Risk
Securitization
Risk
Talent
Management
Risk
New
Technology/
Digitalization
Risk
Political
Risk
Climate
Change Risk
Competition
Environment
Risk
Regulation
Risk
Technology
Risk
Supply-
Demand
Risk
Reputational
Risk
Physical
Risks
Acute
Physical
Risks
Chronic
Physical
Risks
İşbank Risk Management Policies
Capital Adequacy
Policy
Stress Testing Policy
Consolidated Risk
Policies
Climate Change Risk
Policy
Credit Risk Policy
Operational Risk
Policy
Information Systems
Risk Management
Policy
Asset and Liability
Management Risk
Policy
Reputational Risk
Policy
Model Risk
Management Policy
Please visit page 155 for Information on Risk Management Policies Applied by Risk Types.
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Business Ethics
Anti-Bribery and Anti-Corruption
İşbank’s business practices are based on high business ethics
standards. With this understanding, the “Ethical Principles and
Operational Rules” prepared in line with the Principles of Banking
Ethics of the Banks Association, “Human Rights and Human
Resources Policy” and İşbank's Collective Labor Agreement serve as
the basic guidelines in this area.
In accordance with the Ethical Principles and Operational Rules, there
is an Ethics Hotline where employees, customers, and other related
parties can report any violation of operational rules to the Bank’s the
related units. The Internal Audit Division monitors all notifications
submitted through the Ethics Hotline. Confidentiality of notifications is
essential, and employees are not subjected to any disciplinary action,
direct or indirect retaliation, or put at any disadvantage compared
to their peers when reporting a violation. In 2023, the Ethics Hotline
received a total of 6 complaints.
For behaviours deemed to be in violation of the Bank's policies, the
appropriate disciplinary action, up to termination of the employment
contract, is taken according to the applicable provisions and
procedures of the Human Resources Regulation and the Collective
Labor Agreement.
Customer complaints can be submitted via e-mail, petition, or fax to
digital channels, Branches, or directly to the Head Office or the Board
of Inspectors. Customer complaints submitted to Branches and the
Head Office units are transferred to the Customer Relations Platform
and followed up on the relevant platform. Of these complaints those
requiring assessment by the Board of Inspectors are transferred to
the Board by the relevant Head Office divisions. Customer complaints
submitted to the Board of Inspectors are reported to the Audit
Committee on a weekly/monthly basis. In 2023, 53 complaints were
reported to the Audit Committee.
The Bank organizes trainings to raise employee awareness on
business ethics. During the “Getting to Know Our Bank” course,
which is part of the “Starting My Career” trainings for new employees,
the requirement to follow discipline regulations and "Ethical Banking
Principles" is highlighted. During the training, Intern Assistant
Inspectors receive “Ethical Principles” and “Anti-Bribery and Anti-
Corruption” training. the Board of Inspectors’ “Internal Audit” courses
cover banking ethical concepts as part of the Branch Managers
Development Program, As I Rise in My Career and My Management
Career trainings for managers and manager candidates. In 2023,
9,576 hours of ethics training was given to 1,974 employees.
Employees receive digital training on “Ethical Principles and
Operational Rules”. The training includes detailed information on the
Bank’s ethical principles and operational rules, our quality, compliance,
and risk policies, the principles on Combating Financial Crimes and
implementing Sanctions, Compliance with Competition Law and
ensuring Information Security, as well as information on the “Ethics
Hotline” where employees can report any violations or suspected
violations of ethical principles.
The “Getting to Know Our Bank” course, part of the “Starting My
Career” trainings for new employees at İşbank, especially on human
rights, focuses on the principles set out in the Bank’s Human Rights
and Human Resources Policy. Human rights are also covered in the
“Law on Private Security Services and Individual Rights” course for
private security officers as part of their refresher training. In 2023,
585 employees attended Private Security Refresher trainings. In
addition, in 2023, the Support Services Division emailed the Bank’s
“Human Rights and Human Resources Policy” text to all private
security officers for their information.
During the reporting period, a total of 2,524 employees received a
total of 6,034 person*hours of training in human rights.
The Management Development Conferences included seminars on
basic human rights, such as “Empowering Equality”, “Sustainability;
(Am) I Responsible for the Planet” and “Breaking Down the Walls of
Violence Together”, as well as a seminar for managers on “Gender
Equality, Diversity and Inclusion in Institutions: Why and How”.
One of the Bank's top priorities is to ensure full compliance with
competition law rules in all our relations with our customers,
suppliers, competitors, business partners, and regulatory bodies. The
Compliance Commitment Letter distributed to employees for this
reason, as well as the “Competition Compliance Program” introduced
at the end of 2021, demonstrate the priority placed on this topic. As
part of the program, all Head Office division managers attended an
online seminar held in 2023. In addition to the seminar, 93.01% of the
target audience completed the “Competition Law Compliance Guide”
digital training, one of the legal compliance trainings required of all
employees.
In 2023, no lawsuits were brought against anti-competitive
behaviour, antitrust, and monopolistic activities. The lawsuit alleging
anti-competitive activities filed in previous years and resolved in
2023 was decided in favor of the Bank.
Anti-bribery and anti-corruption are among the material topics that
İşbank manages without compromise. The Bank's “Ethical Principles
and Operational Rules” and “Anti-Bribery and Anti-Corruption
Policy” serve as reference for anti-corruption, and the relevant rules
are publicly disclosed on the Bank's website. The relevant Head
Office Division implements the Anti-Bribery and Anti-Corruption
Policy, which is overseen by the Corporate Governance Committee.
Compliance with the provisions of this policy is audited under the
scope of internal audit. The Corporate Governance Committee
determines principles for carrying out action plans to address audit
findings.
Bribery and corruption risk is defined as the risk that the Bank will
suffer losses as a result of a Bank employee 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 anti-bribery and anti-corruption laws and internal
regulations. bribery and corruption risk is measured and prioritized
using a top-down risk assessment, impact-probability analysis, loss
event data analysis, and scenario analysis activities.
The Board of Inspectors conducts routine audits according to Internal
Audit Standards, where all risks, including anti-bribery and anti-
corruption, are addressed on a regular 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. Aside from existing risks, factors
that present potential risks are also identified, appropriate solutions
are provided, and the entire process is monitored. If any violations of
anti-corruption policies are discovered during the audits, appropriate
action is taken in accordance with internal discipline regulations and
legal regulations.
All findings, reports, and customer complaints involving corruption
practices are meticulously handled and thoroughly investigated. At
the conclusion of audits, the reports prepared to allow appropriate
administrative decisions to be taken in accordance with the Bank's
Collective Labor Agreement and the legislation are forwarded to
the relevant Head Office Divisions for action. In 2023, the scale of
activities reviewed for corruption risks was found to be insignificant
compared to the Bank’s total assets.
For behaviors deemed to be in violation of the Bank's policies, the
appropriate disciplinary action, up to termination of the employment
contract, is taken according to the applicable provisions and
procedures of the Human Resources Regulation and the Collective
Labor Agreement. When circumstances necessitate legal action, the
violation is brought to the attention of legal authorities.
Information on the details of the Bank's Anti-Bribery and Anti-
Corruption Policy was provided as part of the content titled “Anti-
Bribery and Anti-Corruption” in the e-trainings “Compliance with
Combating Financial Crimes and Sanctions Policy Program” and
“Compliance with Combating Financial Crimes and Sanctions Policy
Program - General Principles” assigned to all employees as legal
compliance training. The Corporate Compliance Division determines
and regularly updates their content. Regular communication is carried
out to ensure that employees complete these trainings.
The "Getting to Know Our Bank" course, part of "Starting My Career"
trainings for new employees at İşbank, emphasizes adherence to
disciplinary regulations and the "Ethical Banking Principles".
Anti-Corruption and Anti-Bribery topics are covered in the
“Compliance with Combating Financial Crimes and Sanctions Policy
Program” course within the Starting My Career Training for our
employees with the titles of Officer and Assistant Specialist, as well
as the As I Rise in My Career Training for our employees who are
promoted to Senior roles. The "Banking Law" course included in the
Career as a Specialist training for Senior Assistant Specialists and
the career training programs for employees promoted to Assistant
Manager roles, provides information about the legal regulations
governing corruption and other related offenses. In 2023, 19,889
people received a total of 2,667 person*hours of Anti-Corruption and
Anti-Bribery training.
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. During the reporting period, no
suppliers were discovered to be implicated in bribery and corruption
incidents.
Click here for İşbank’s Ethical Principles and Operational Rules.
Click here for İşbank’s Anti-Bribery and Anti-Corruption Policy.
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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. Since its
foundation, the Bank has implemented projects in
the fields of education, environment, culture, and
arts.
Risks
Loss of reputation due to failed projects and poor partner selection
Decrease in brand awareness among younger generations due to
projects that fail to meet current needs
Opportunities
Being a trusted bank in the eyes of stakeholders and society with projects
developed in line with society's needs
Contribution to Sustainable Development Goals through projects
Direct communication with customers thanks to increased financial literacy
Contribution to corporate reputation
Relevant Stakeholders
Material Topics
Society
Contribution to Social
Welfare
Contributed SDGs
Capital Elements
Social-Relational
Capital
Key Performance Indicators
2021
2022
2023
Contribution to equal
opportunities in education: 81
Students from 81 Cities
In 2021, the total number of
graduates reached 297.
In 2022, the total number of
graduates reached 361.
In 2023, the total number of
graduates reached 428.
Supporting the upbringing
of generations who read and
question, and supporting
the cognitive and cultural
development of children: The
amount of books donated during
the “Show Your Report Card, Get
Your Book” Campaign
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.
500,000 physical copies of
the book “The Adventures
of Sherlock Holmes” were
distributed to students as part of
the 15th campaign, and children
were also given digital versions
of the book “The Secret Garden”
through the kumbaradergisi.
com site.
For the 16th campaign,
“Çocuklar Soruyor Tarih Dede
Anlatıyor” was printed in
500,000 copies and
distributed digitally to children
through the kumbaradergisi.
com site.
Supporting the upbringing
of generations who read and
question, and supporting
the cognitive and cultural
development of children:
Amount of books donated to
schools and libraries
Targets
2023 Target
The number of books sent to
schools reached 31,615 which
were distributed to 1,734 schools
as of year-end 2021.
The number of books sent
to schools reached 56,000
which were distributed to 2,167
schools as of year-end 2022.
The number of books sent
to schools reached 167,213
which were distributed to
4,084 schools as of year-end
2023.
Realizations in 2023
Targets for 2024 and Beyond
Continuing the campaign in a hybrid model in "Show
Your Report Card, Get Your Book”
Printed books were sent to all domestic and
TRNC Bank branches and museums.
Our campaign will continue both
printed and online.
81 Students from 81 Provinces Project in cooperation
with Darüşşafaka Cemiyeti
In 2023, the total number of graduates
reached 428.
The project is still ongoing.
The Corporate Social Responsibility Committee reporting to the Board of Directors oversees İşbank’s social investment programs. Collaborations
with different stakeholder groups, particularly non-governmental organizations promote effective stakeholder engagement in social responsibility
projects.
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* The number reported as 296 in the previous period has been revised.
Good Corporate CitizenLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Projects in the Education
İşbank implements education projects aimed at educating new generations to uphold Atatürk’s ideas and
elevate our nation to a modern society.
ό Chess
ό 81 Students from 81 Cities
İşbank supports chess education to make it a popular and easily
accessible activity for children. In 2005, the Bank became the main
sponsor of the Turkish Chess Federation (TSF), assisting in the
growth of chess as a popular sport in Türkiye.
ό İşbank Chess Classes
Chess classes are set up in primary and secondary schools to
encourage students to play chess, focus teachers’ and parents’
attention to this sport, and address the absence of equipment in
schools with limited resources.
As of 2023, there were 35,000 chess classes
offered in schools throughout Türkiye.
ό The Northern Cyprus Chess Federation
İşbank is the main sponsor of TSF and the Northern Cyprus Chess
Federation (KKSF) since 2013. Following the sponsorship, chess
became a weekly club activity in primary schools in the Turkish
Republic of Northern Cyprus (TRNC). All schools in the TRNC have a
chess class.
ό Turkish Juniors and Stars Chess Championship
The “Turkish Juniors and Stars Chess Championship”, which is held
in Antalya every January, was held between January 21-28 in 2023.
A total of 2,304 players competed at the 2023 Turkish Juniors and
Stars Chess Championship.
A total of 220 players, 144 in the junior category and 76 in the senior
category, ranked first and qualified to join the national team pool.
ό School Sports Chess Tournament
The 2023 Türkiye School Sports Chess Tournament was held at
Aydın Mimar Sinan Sports Hall between June 7-11. In the tournament,
706 players from 138 school teams from 51 cities in Türkiye
competed.
In the 2008-2009 academic year, İşbank collaborated with
Darüşşafaka to launch the "81 Students from 81 Cities" project,
which was one of the country’s most comprehensive and long-term
educational projects. İşbank covers all students' education expenses
under the program.
Within the scope of the project, 66 students
graduated from the school, and the total number of
graduates reached 428 in 2023.
İşbank continues to support students who graduated from
Darüşşafaka and passed the university entrance exam through the
81 Students from 81 Cities Project. Furthermore, within the scope
of Koç University's "Anadolu Scholarship Holders" program, İşbank
covers the education expenses for a select number of Darüşşafaka
graduates each year.
ό Show Your Report Card, Get Your Book
İşbank started the "Show Your Report Card Get Your Book" at the
end of the 2007-2008 academic year, which is one of the largest
book campaigns in Türkiye to date.
The campaign aimed to support children's cognitive and cultural
development, foster a generation of readers and questioners, and
contribute to cordial communication between İşbank and children
from an early age.
The book "Çocuklar Soruyor Tarih Dede Anlatıyor" was made
available to students in printed form and digitally via the Kumbara
Magazine portal (www.kumbaradergisi.com) and the Kumbara
Magazine mobile application for the 16th time at the end of the
2022-2023 academic year, commemorating the 100th anniversary
of our Republic’s founding. The books were sent to all Bank branches
and museums in Türkiye and the TRNC.
During the campaign, books were also sent to children in regional
boarding schools, affection houses, and closed youth jails, and
juvenile reformatories. Furthermore, books printed in the Braille
alphabet were sent to schools that teach visually impaired children.
ό Book Donation to Schools and Libraries
ό In our 100th Anniversary Year, the Internet for
İşbank’s Kültür Yayınları distribute books to schools and public
libraries around Türkiye as part of their social responsibility activities
to promote education. In 2023, 167,213 thousand books were
distributed to 4,084 schools and libraries.
ό Kumbara Magazine
The magazines "Kumbara" and "Mini Kumbara” are published online
with two distinct types of content for children aged 3-6 and 7-14 to
provide high-quality, instructional, and amusing content. Kumbara
Magazine, with an improved interface and increased content
frequency, has also become an important platform for the Show Your
Report Card, Get Your Book campaign.
ό Golden Youth Award
Every year since 1971, İşbank has given the "Golden Youth" award to
students who pass the university entrance exam. So far, more than
3,900 students have received awards.
ό Artificial Intelligence Application and Research
Center
The "Artificial Intelligence Application and Research Center" was
established in collaboration with İşbank and Koç University to
contribute to the scientific and academic activities in our country and
carry out advanced studies in the field of artificial intelligence, which
is of great importance globally. Koç University faculty members train
experts for industry and academia at the Artificial Intelligence Center,
which is housed inside of Koç University Faculty of Engineering. The
also seek to solve the problems of the business world.
100 Villages Project
In today’s quickly digitalizing world, the Internet has grown in
importance in areas such as information access, educational
transformation, and agricultural and production efficiency. The
"Internet for 100 Villages" Project, launched by the İşNet subsidiary,
aims to promote economic and social development in rural areas.
The project aims to provide internet connectivity to villages that lack
one. Satellite internet is provided through installations in common
locations such as schools and headman’s offices.
ό Infectious Diseases Application and Research
Center
During the global COVID-19 pandemic, İşbank and Koç University
collaborated to establish the "Infectious Diseases Application and
Research Center" in support our country’s scientific and academic
research in the field of public health.
The center established at Koç University and supported by İşbank
aims to advance the scientific activities in our country in public health,
conduct research on infectious diseases, provide diagnosis and
treatment solutions for diseases, and develop prevention methods.
The center coordinates projects throughout Koç University’s Faculty
of Medicine, Engineering, Science, Economics, and Administrative
Sciences and Humanities Faculties and operates at the Koç
University Hospital in Topkapı.
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Good Corporate CitizenLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Projects in the
Environmental
Field
İşbank collaborates with non-governmental organizations on
various projects to create a better world to live in, draw attention to
environmental problems associated with deforestation, and promote
environmental awareness in society, especially among children.
ό The Seas is Ours, The Future is Ours
One of İşbank’s strategic priorities is sustainability and the Bank
carries out various projects under the theme “The Seas is Ours, The
Future is Ours.” Thus, the Bank has carried out activities to raise
public awareness about marine mucilage and its effects, as well as
to identify solutions. the "Future of the Seas: Seagrass Meadows"
project was implemented in collaboration with the Turkish Marine
Research Foundation TÜDAV. The research focused on Posidonia
oceanica seagrass meadows, which are crucial for the Marmara
Sea. The project aims to map, clean, and protect Posidonia oceanica
seagrass meadows. Furthermore, under the leadership of the
METU Institute of Marine Sciences, the Sea Explorer, an unmanned
underwater glider, which was provided to METU last year to support
the marine studies of the whole academic and scientific community,
continues its underwater research.
Together with the discoveries, comprehensive measurements are
made in the seas and data that advances research are revealed.
ό TEMA Foundation Collaboration
Based on an agreement with the TEMA Foundation, the TEMA
Foundation has committed to planting one young tree for each
100 kg of paper donated by İşbank. The Bank donated 567,014
kg of waste paper between March 2020 and March 2023, which
translates to 5,670 saplings to be planted for this period.
Projects in the
Field of Culture
and Art
İşbank contributes to enriching the country's cultural and artistic life
by bringing works from the global cultural and creative landscape
to the country. The Bank also supports projects that evaluate the
country's archaeological heritage, presenting it to new generations
and preserving it for the future.
ό International Atatürk Conference
Founded by Gazi Mustafa Kemal Atatürk as our country's first
national bank who believed that political independence after the
War of Independence could only be achieved through economic
independence, İşbank organized an international conference with
the theme “A Look to the Next Century with Atatürk's Vision” to
commemorate the Republic's 100th Anniversary.
The conference, hosted by the İşbank’s Chairperson and CEO took
place on September 28-29, 2023 in the İş Towers Hall. The Minister
of Culture and Tourism delivered the opening speech, and notable
speakers from Türkiye and abroad also attended. Notable lecturers,
professors, and distinguished speakers from Türkiye and around the
world addressed a wide variety of topics, from history to economy,
science to culture and sports, with a past-to-future approach. The
economy, modernity, women's rights, science, and a variety of
other future-related topics were assessed within the framework of
Atatürk's vision. Panels on “The Truest Mentor in Life is Science” and
“The Rising New Generation, the Future is Yours” were organized.
ό Kültür Yayınları
Kültür Yayınları, which continues to publish on the principles of
contributing to the development of Turkish, quality publishing, and
instilling the habit of reading at an early age, brought 16,069,702
books to readers in 2023.
İş Sanat
On behalf of İşbank, İş Sanat implements long-term, audience-
engaging sustainable projects in cultural domains of art, museology,
archaeology, and history, in order to support our country's cultural
development and to enhance knowledge in these domains by
offering opportunities for the public to interact with art.
ό Performing Arts
In 2023, İş Sanat continued its activities in the field of performing
arts by using tangible venues. Numerous performances featuring
local and international artists from various performing arts genres
were shown to audiences at various locations, including İş Towers
Hall. These events included classical music concerts, local projects,
recitals of stories and poetry, as well as theatrical production. Events
were organized outdoors in Istanbul, Ankara, and Izmir with "Friday
After Work”, in various ancient cities with “Ancient Stage”, and on the
YouTube channel.
ό Art Galleries
In 2023, Kibele Art Gallery hosted its visitors with Berna Türemen's
exhibition titled "Retrospective" between October 16-December 18,
2023.
Moreover, In 2023, Zeki Faik İzer'’s exhibition titled "Paris, İstanbul,
Nice" was organized after Beril Anılanmert’s “Seyir Defteri” exhibition
at the Ankara Art Gallery.
ό Contributions in the Field of Archaeology
Archaeological studies are supported to unearth and preserve
Türkiye’s rich archaeological heritage, as well as to shed light on the
history of civilization through scientific research. The archaeological
activities supported are listed below.
ੵ Zeugma Ancient City - House of Muses in Nizip
ੵ Patara Ancient City in Kaş - Antalya
ੵ Teos Ancient City in Seferihisar - Izmir
ੵ Kaman excavations at Kalehöyük, Yassıhöyük, and Büklükale in
Kaman - Kırşehir
ੵ Nysa Ancient City in Sultanhisar - Aydın
ੵ Stratonikeia Ancient City in Yatağan - Muğla
Archaeological publications that are prepared by the editorship of
excavation heads to ensure the academic studies are transferred to
the future generations is published by Cultural Publications. Tilll today
Zeugma, Patara, Teos and Nysa books were prepared.
ό Museology and Institutional History Studies
İşbank Museum (Eminönü, Istanbul)
İşbank Museum, which opened in November 2007, showcases
the Bank’s long-standing corporate history and Türkiye’s
economic development through banking equipment, documents,
communication tools, photographs, advertising-promotional
materials, and films.
The number of visitors in 2023 reached 397,086, bringing the total
number of visitors since its opening to 2,146,413. The museum also
continues to host its visitors with temporary exhibitions.
ੵ The İstiklal Exhibition, which premiered in 2019 at İşbank Museum,
was expanded with İzmir-specific additions, and “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. 328,575
people visited the exhibition from its opening date until the end of
2022.
ੵ On March 22, 2023, the "Long Live the Republic Exhibition" was
opened to the public in honor of our Republic’s 100th anniversary.
323,990 visitors were hosted throughout the year.
İşbank Museum of Economic Independence (Ulus,
Ankara)
İşbank transformed its historical building in Ulus, Ankara, which
served for many years as the Bank's third Head Office, into a museum
to share its experience with the public. This building is of great
importance in terms of national economic history. In 2019, the "İşbank
Museum of Economic Independence" opened in the historical Ulus
building, a landmark in the capital. The museum houses the archives
and recollections of the country's economic independence and
development.
The "Long Live the Republic Exhibition" was opened simultaneously
at the İşbank Museum and at the Economic Independence Museum.
The number of unique visitors to the exhibition exceeded 87,000.
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Good Corporate CitizenLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report İşbank Painting and Sculpture Museum (Beyoğlu,
Istanbul)
Following the restoration and construction works that began in
2020 to renovate the historic building in Beyoğlu into a museum,
the İşbank Painting and Sculpture Museum opened its doors to art
lovers on October 29, 2023, as a gift of İşbank to our country for the
100th anniversary of our Republic. Preparations for the museum were
carried out in collaboration with founding curator Prof. Dr. Gül İrepoğlu,
plastic arts consultant Prof. Rahmi Aksungur, and museological
consultant Burçak Madran.
The total number of visitors reached 43,123 in
2023.
ό Donations and Sponsorships
In 2023, a total of TL 2.65 billion was donated to the projects of
institutions and organizations such as Darüşşafaka Society, Koç
University-Artificial Intelligence Application and Research Center,
Common Sense Association, Koç University-Research Center for
Infectious Diseases, Koç University Research and Application Center
for Gender and Women's Studies, and the Banks Association of
Türkiye, of which TL 2.3 billion was donated to AFAD.
We are Together, You are Not Alone
İşbank announced that it has decided to write off all personal
loan debts of its customers who lost their lives in the region of the
February 2023 earthquakes. And it has also allocated TL 10 billion in
resources for the first phase which will help heal the region’s wounds
and mobilize production and employment.
İşbank Istanbul Marathon
İşbank is strengthening the celebrations by assuming the title
sponsorship of the Istanbul Marathon for the 100th anniversaries of
both our Republic and İşbank. The Istanbul Marathon, which unites
Asia and Europe with the power of sports, as the only transcontinental
marathon in the world, will be named “İşbank Istanbul Marathon” in
2023 to commemorate the Republic’s 100th anniversary and in 2024
for the 100th anniversary of İşbank. Beginning November 5, 2023,
the events to be organized for two years will be held under the names
“İşbank Istanbul Marathon” and “İşbank Istanbul Half Marathon”.
69th Sait Faik Abasıyanık Story Award
The 69th edition of the Sait Faik Abasıyanık Story Award, organized
in collaboration with the Darüşşafaka Association and Kültür Yayınları
to honor the memory of Sait Faik Abasıyanık, one of the greatest
writers of our literature, was organized on the 100th anniversary of
our Republic. The winner Ayşegül Devecioğlu was presented with
her award at a ceremony. İşbank continued to be a supporter of this
tradition and wishes to further strengthen it at the 100th anniversary
of our Republic.
172
Our Corporate Governance Approach
Corporate governance underpins İşbank's operations and supports its ethical framework and decision-making processes. It plays an important role in
increasing stakeholders’ trust by ensuring transparency, accountability, and compliance with regulations. By implementing strong governance practices,
İşbank is able to effectively manage risks, optimize its operations, and strengthen its resilience and sustainability by quickly adapting to market changes.
Strong governance practices are a factor of preference for investors seeking stable and well-governed institutions. Corporate governance enhances the
Bank's reputation and supports its long-term growth and success.
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
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.
X
X
X
X
X
X
X
X
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
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Company Compliance Status
Yes
Partial No
Exempted Not Applicable
Explanation
Company Compliance Status
Yes
Partial
No
Exempted
Not
Applicable
Explanation
In our Bank, minority
rights are exercised
in line with the related
legislation.
X
X
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.
X
1.6. DIVIDEND RIGHT
1.6.1 - The dividend policy approved by the General
Shareholders' Meeting is posted on the company website.
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.
X
X
X
X
X
X
X
X
X
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.
3.2. SUPPORTING THE PARTICIPATION OF
THE STAKEHOLDERS IN THE CORPORATION'S
MANAGEMENT
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.
X
X
X
X
X
X
X
X
X
X
X
İşbank employees
participate in the
management of the Bank
via
their beneficiary status
in İşbank Members'
Supplementary Pension
Fund, which holds
38,20% of İşbank shares.
174
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Corporate Governance Compliance Report
Company Compliance Status
Yes
Partial
No
Exempted
Not
Applicable
Explanation
Company Compliance Status
Yes
Partial
No
Exempted
Not
Applicable
Explanation
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.
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.
X
X
X
X
X
X
X
X
X
X
X
X
X
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.
4.2.8 - The company has subscribed to a Directors and
Officers liability insurance covering more than 25% of the
capital.
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.
X
X
X
X
X
X
X
X
X
X
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.
X
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Corporate Governance Information Form
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
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.
X
4.5. BOARD COMMITTEES
4.5.5 - Board members serve in only one of the Board's
committees.
X
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.
X
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.
X
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.
4.6.5 - The individual remuneration of board members
and executives is disclosed in the annual report.
X
X
Company Compliance Status
Yes Partial No Exempted
Not
Applicable
Explanation
1.1. Facilitating the Exercise of Shareholders Rights
1. SHAREHOLDERS
The number of investor meetings (conference,seminar/
etc.) organised by the company during the year
In 2023, İşbank participated 7 conferences online for stock and bond
investors. In these events, a total of 86 meetings were conducted. In
addition to 4 investor events in teleconference and videoconference
format, where investors participated via remote access, 121 meetings were held.
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."
X
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.
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/1120213
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
The relevant link to the PDP with minute of the General
Shareholders' Meeting where the donation policy has
been approved
İşbank Donation and Contribution Principles can be found on İşbank
website, Home Page > About Us > Investor Relations > Corporate
Governance > İşbank Donation and Contribution Principles.
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 2023.
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
38.20%
1.5. Minority Rights
Whether the scope of minority rights enlarged (in terms of
content or the ratio) in the articles of the association
No
If yes, specify the relevant provision of the articles of
association.
-
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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
3/30/2023
The number of information requests received by the company
regarding the clarification of the agenda of the General
Shareholders' Meeting
0
Shareholder participation rate to the General Shareholders'
Meeting
Percentage of shares directly present at the GSM
Percentage of shares represented by proxy
80.64%
0.06%
80.57%
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
682
The link to the related PDP general shareholder meeting
notification
https://www.kap.org.tr/tr/Bildirim/1120213-1130098-1134105
2. DISCLOSURE AND TRANSPARENCY
2.1. Kurumsal İnternet Sitesi
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
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
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
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
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
Additional Information Regarding the Related Legislation
İşbank Committees
Information about the Board of Directors Meetings in 2023
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 2023 with Independent Audit's Report Thereon - Information
on Other Provisions
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
İşbank has no cross ownership subsidiaries.
Responsible Operations - Decent Work / Good Corporate Citizen -
Contribution to Social Welfare
3. STAKEHOLDERS
t
3.1. Corporation’s Policy on Stakeholders
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)
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
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
The contact detail of the company alert mechanism
List of languages for which the website is available
Turkish and English
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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.
4. BOARD OF DIRECTORS-I
4.2. Activity of the Board of Directors
Corporate bodies where employees are actually represented
"Isbank employees participate in the management of the Bank via their beneficiary
status in İşbank Members' Supplementary Pension Fund, which holds 38.20% of
İşbank shares.
In addition, in accordance with the Occupational Health and Safety Law No. 6331,
Occupational Health and Safety Board meetings are held in our buildings with 50
or more Bank employees, and employee representatives take part in these boards.
Employee representatives are elected from the workplace employee representatives of
the Basisen Union."
3.3. Human Resources Policy
The role of the board on developing and ensuring that the
company has a succession plan for the key management
positions
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.
Board of Directors create succession plans.
Home Page > About Us > Sustainability > Our Policies
Whether the company provides an employee stock ownership
programme
Pay edindirme planı bulunmuyor (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
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
Date of the last board evaluation conducted
Date of the Board of Directors' self-assessment questionnaire (08.12.2023)
Whether the board evaluation was externally facilitated
No
Whether all board members released from their duties at the
GSM
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
124
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
Chairman and General Manager seats are held by different persons
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
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/bankamizi-taniyin/Documents/yatirimci-iliskileri/MR-TIS-
KIB-22-00264_Cesitlilik_Politikasi.pdf
The number and ratio of female directors within the Board of
Directors
2 / %18
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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 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
Non-executive
Not independent
director
4/1/2011
GÜZİDE MELTEM
KÖKDEN
Non-executive
Independent
director
HAKAN ARAN
Executive
FAZLI BULUT
Non-executive
DURMUŞ ÖZTEK Non-executive
RECEP HAKAN
ÖZYILDIZ
MUSTAFA
RIDVAN SELÇUK
Non-executive
Non-executive
AHMET GÖKHAN
SUNGUR
Non-executive
SADRETTİN
YURTSEVER
Non-executive
ŞEBNEM AYDIN
Non-executive
GÖKHAN ŞEN
Non-executive
Not independent
director
Not independent
director
Not independent
director
Not independent
director
Not independent
director
Independent
director
Independent
director
3/30/2023
4/1/2021
3/29/2019
3/31/2020
3/31/2020
3/31/2020
3/31/2020
www.kap.org.tr/tr/
Bildirim/916723
3/31/2020
Not independent
director
3/30/2023
Independent
director
3/30/2023
-
No
-
-
-
-
-
No
No
-
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
12 physical, 3 online
Director average attendance rate at board meetings
Whether the board uses an electronic portal to support its
work or not
Number of minimum days ahead of the board meeting to
provide information to directors, as per the board charter
The name of the section on the corporate website that
demonstrates information about the board charter
Number of maximum external commitments for board
members as per the policy covering the number of external
duties held by directors
4.5. Board Committees
100%
Yes
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.
Articles of Association
None
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
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Composition of Board Committees-I
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
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
Sadrettin Yurtsever
Fazlı Bulut
Şebnem Aydın
Nilgün Yosef Osman
Özge Han Mercimekçi
Güzide Meltem Kökden
Sadrettin Yurtsever
Adnan Bali
Sadrettin Yurtsever
Hakan Aran
Adnan Bali
Şebnem Aydın
Güzide Meltem Kökden (Yedek
Üye)
Credit Committee
Credit Committee
Credit Committee
Credit Committee
Credit Committee
Fazlı Bulut (Yedek Üye)
Yes
No
No
No
No
Yes
No
Yes
No
Yes
No
No
No
No
Board member
Board member
Board member
Not board member
Not board member
Board member
Board member
Board member
Board member
Board member
Board member
Board member
Board member
Board member
Turkish Republic of Northern Cyprus Internal
Systems Committee
Güzide Meltem Kökden
Yes
Board member
Turkish Republic of Northern Cyprus Internal
Systems Committee
Sadrettin Yurtsever
Credit Revision Committee
Adnan Bali
Credit Revision Committee
Güzide Meltem Kökden
Credit Revision Committee
Sadrettin Yurtsever
Credit Revision Committee
Şebnem Aydın
Corporate Social Responsibility Committee
Şebnem Aydın
Corporate Social Responsibility Committee
Sezgin Yılmaz
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
Adnan Bali
Güzide Meltem Kökden
No
No
No
No
No
No
No
No
No
No
No
No
No
Yes
No
Board member
Board member
Board member
Board member
Board member
Board member
Not board member
Board member
Board member
Board member
Not board member
Not board member
Not board member
Board member
Board member
Corporate Governance
Committee
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
186
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
Risk Committee
Risk Committee
Risk Committee
Risk Committee
Sadrettin Yurtsever
Hakan Aran
Ebru Özşuca
İzlem Erdem
Can Yücel
Sezai Sevgin
Hürdoğan Irmak
Süleyman H. Özcan
Engin Yalçın
No
No
No
No
No
No
No
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
Operational Risk Committee
Güzide Meltem Kökden
Yes
Board member
Operational Risk Committee
Hakan Aran
Operational Risk Committee
Sadrettin Yurtsever
Operational Risk Committee
N. Burak Seyrek
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
Sustainability Committee
Adnan Bali
Sustainability Committee
Sadrettin Yurtsever
Sustainability Committee
Şebnem Aydın
Sustainability Committee
İzlem Erdem
Sustainability Committee
N. Burak Seyrek
Sustainability Committee
Can Yücel
Sustainability Committee
Sustainability Committee
Ozan Gürsoy
Sezgin Yılmaz
No
No
No
No
No
No
No
No
No
No
No
No
No
Yes
No
No
No
No
No
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
Board member
Board member
Board member
Not board member
Not board member
Not board member
Not board member
Not board member
187
Good Corporate CitizenLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Corporate Governance Information Form
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
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Sustainability Committee
Sezgin Lüle
Sustainability Committee
Mehmet Celayir
Sustainability Committee
Sabri Gökmenler
Sustainability Committee
Sustainability Committee
Sezai Sevgin
Suat E. Sözen
Sustainability Committee
Hürdoğan Irmak
Sustainability Committee
Nilgün Yosef Osman
Board of Directors Operating Principles
Committee
Adnan Bali
Board of Directors Operating Principles
Committee
Board of Directors Operating Principles
Committee
Sadrettin Yurtsever
Durmuş Öztek
No
No
No
No
No
No
No
Yes
No
No
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
4. BOARD OF DIRECTORS-III
4.5. Board Committees-II
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)
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)
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)
İşbank Committees
At İşbank, functions of Nomination Committee are fulfilled by Corporate Governance
Committee.
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 Percentage
Of Independent
Directors In The
Committee
The Number Of
Meetings Held
In Person
The Number Of
Reports On Its
Activities Submitted
To The Board
Corporate Governance
Committee
Audit Committee
Remuneration Committee
Other
Other
Other
Other
Other
Other
Other
Other
60%
100%
100%
80%
100%
100%
Credit Committee
Turkish Republic of Northern Cyprus
Internal Systems Committee
Credit Revision Committee
Corporate Social Responsibility Committee
50%
Risk Committee
Operational Risk Committee
Sustainability Committee
Board of Directors Operating Principles
Committee
64%
57%
18%
100%
20%
100%
50%
20%
100%
50%
14%
18%
14%
0%
0%
3 online
55
11
-
10
6 physical
2 physical, 4 online
12
3
-
-
-
12
-
-
2
1
9
14
-
-
-
188
189
Good Corporate CitizenLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Sustainability Principles Compliance Framework
COMPLIANCE STATUS
Yes
No
Partial
Irrelevant
Explanation
Definition
COMPLIANCE STATUS
Yes
No
Partial
Irrelevant
Explanation
Definition
A. General Principles
A1. Strategy, Policies and Targets
A1.1
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
A1.2
Short and long- term targets set within the
scope of ESG policies were disclosed to the
public.
A2. Application / Monitoring
A2.1
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.
A2.2
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
In the annual reports information on the
sustainability performance, goals and
actions of the partnership is given in an
understandable accurate and adequate
manner
x
x
x
x
x
x
x
x
x
190
Home Page >About Us > Sustainability >
Our Policies
Home Page >About Us > Sustainability >
Our Policies
Global Tendencies, Risks, Opportunities and
Forecasts, page :24-27
Value Creation Model, page :32-35
Reliable Financial Actor, page 56
Responsible Operations, page 106
Good Corporate Citizen page 130
2023 CDP Climate Change Report, 20-32
Home Page >About Us > Sustainability >
Our Organization
Committees Operating at İşbank,İşbank
Committees, Sustainability Committee,
page 152
2023 CDP Climate Change Report, page
2-4
Value Creation Model, page :32-35
Reliable Financial Actor, page 56
Responsible Operations, page 106
Good Corporate Citizen page 130
2023 CDP Climate Change Report, page
20-32
2023 CDP Water Security Report, page
30-32
Key Performance Indicators, page 59, 81,
91, 109, 117, 133, 167
Responsible Products and Services, page
72-74
Products and Services Contributing to a
Green Economy, page :87-89, Financial
Inclusion page:75-78
Home > About Us > Sustainability >
Responsible Products and Services >
Products and Services Contributing to
Society
Global Tendencies, Risks, Opportunities and
Forecasts, page :24-27
How Do We Create Value? Sustainability at
Isbank, page 31
Reliable Financial Actor, page 56
Responsible Operations, page 106
Good Corporate Citizen page 130
A3.2
Provides information about which of the United
Nationas (UN) 2030 Sustainable Development
Goals its activities are related to
A3.3
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.
B. Environmental Principles
B1
B2
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
B5
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.
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
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)
B10
Discloses the standards, protocols,
methodology and base year detailsfor
collecting and calculating its data
x
x
x
x
x
x
x
x
x
x
x
x
x
Contribution to Sustainable Development
Goals, page :54-55
https://www.kap.org.tr/tr/
Bildirim/977504-973221- 952353-
947832- 945276-928647- 1012970-
1031025-1038508- 1053513-1065379-
1070878
Non-Financial Data Reporting Guide and
Independent Assurance Report, page
459-465
Reducing the negative impacts of our
operations, page :108
Home > About Us > Sustainability > Our
Policies
About the Report, page 6-7
Non-Financial Data Reporting Guide and
Independent Assurance Report, page
459-465
2023 CDP Climate Change Report, page
5-6
How Do We Create Value?
Sustainability at İşbank, page 31
Global Tendencies, Risks, Opportunities and
Forecasts, page 24-27
Reliable Financial Actor, page 56
Responsible Operations, page 106
Good Corporate Citizen page 130
2023 CDP Climate Change Repor, page
15-18
Responsible Procurement, page 113-115
Home > About Us > Sustainability > Our
Policies > Supplier Code of Conduct
Initiatives Supported in the Field of
Sustainability,
Page 52-53
Corporate Memberships, page 445
Home > About Us > Sustainability >
Memberships and Initiatives
Reducing the negative impacts of our
operations, page 108
Home > About Us > Sustainability >
Memberships and Initiatives
Reducing the negative impacts of our
operations, page 108
Non-Financial Data Reporting Guide and
Independent Assurance Report, page
459-465
191
Good Corporate CitizenLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report COMPLIANCE STATUS
COMPLIANCE STATUS
Yes
No
Partial
Irrelevant
Explanation
Definition
Yes
No
Partial
Irrelevant
Explanation
Definition
B11
Discloses the status of environmental
indicators for the reporting year in comparison
with previous years (increase or decrease)
B12
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.
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
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.
B21
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
x
x
x
192
Reducing the negative impacts of our
operations, page 108
Home > About Us > Sustainability >
Responsible Banking > Our Environmental
Impact
2023 CDP Climate Change Report, page
36-45
Reducing the negative impacts of our
operations, page 108
2023 CDP Climate Change Report, page
20-32
Climate Action, page 80
Home > About Us > Sustainability >
Responsible Banking > Combating Climate
Change
2023 CDP Climate Change Report, page
15-18
Climate Action, page 80
Home > About Us > Sustainability >
Responsible Products and Services
> Products Contributing to the Green
Economy
Sustainable Procurument, page 113-115
Home > About Us > Sustainability > Our
Policies > Supplier Code of Conduct
Reducing the negative impacts of our
operations, page 108
Reducing the negative impacts of our
operations, page 108
Home > About Us > Sustainability >
Responsible Banking > Our Environmental
Impact
Reducing the negative impacts of our
operations, page 108
Home > About Us > Sustainability >
Responsible Banking > Our Environmental
Impact
Reducing the negative impacts of our
operations, page 108
Reducing the negative impacts of our
operations, page 108
Home > About Us > Sustainability >
Responsible Banking > Our Environmental
Impact
Reducing the negative impacts of our
operations, page 108
Home > About Us > Sustainability >
Responsible Banking > Our Environmental
Impact
Reducing the negative impacts of our
operations, page 108
Home > About Us > Sustainability >
Responsible Banking > Our Environmental
Impact
Non-Financial Data Reporting Guide and
Independent Assurance Report, page
:459-465
2023 CDP Water Security Report page
19-23
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
İIn terms of the sum of Scope-1
and Scope-2 emissions
calculated in accordance with the
International GHG Protocol, İşbank
aims to conduct its activities
as carbon-neutral by 2026. In
2021, İşbank started to procure
renewable energy, and by 2022,
it had reached 100% electricity
consumption from renewable
energy.
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..
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
x
x
B23
Information on carbon credits accumulated
or purchased during the reporting period has
been disclosed to the public.
B24
Discloses the details if carbon pricing is
applied within the Company
B25
The platforms where the partnership
discloses its environmental information are
publicly disclosed.
C. Social Principles
C1. Human Rights and Employee Rights
C1.1
C1.2
C1.3
C1.4
C1.5
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.
x
x
x
x
x
x
Initiatives Supported in the Field of
Sustainability,
page :52-53
2023 CDP Climate Change Report
2023 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 113-115
Financial Inclusion, page 75-78
Equal Opportunity and Diversity, page
123-125
Equal Opportunity and Diversity ve Gender
Equality, page 123-125
GRI Content Index, page 466-469
Decent Work, page 116
Home > About Us > Investor Relations >
Corporate Governance > Remuneration
Policy
Home > About Us > Investor Relations >
Corporate Governance > Ethical Principles
and Code of Conduct
193
Good Corporate CitizenLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report COMPLIANCE STATUS
Yes
No
Partial
Irrelevant
Explanation
Definition
Dividend Distribution Policy
Determines the dispute resolution processes
by establishing mechanisms for employee
complaints and resolution processes.
C1.5
Explains the activities to ensure employee
satisfaction within the reporting period.
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.
C1.8
Establishes and discloses a code of ethics.
C1.9
C1.10
Explains the work within the scope of social
investment,social responsibility, financial
inclusion and access to finance.
Organizes information meetings and training
programs on ESG policies and practices for
employees.
x
x
x
x
x
x
x
x
C2. Stakeholders, International Standards and Initiatives
x
x
x
x
x
x
x
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
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.
D1
D2
194
Compliance with Operating Principles,
page 126
Home > About Us > Investor Relations >
Corporate Governance > Ethical Principles
and Code of Conduct
Decent work, page 116
Home > About Us > Sustainability > Our
Policies > Occupational Health and Safety
Policy
Employee Health and Safety, page 127
Human Resources Data, page 452
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 166
Financial Inclusion, page 75-78
Talent Management, page 128-129
Equal Opportunity and Diversity ve Gender
Equality page 123-125
Human Resources data, page 450-451
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 70-72
Stakeholders, page 38-40
About the Report, page 6-7
Initiatives Supported in the Field of
Sustainability, page :52-53
2023 CDP Climate Change Report, page
2, 8-9
Initiatives Supported in the Field of
Sustainability, page 52-53
İşbank's Sustainability Journey, page
50-52
Initiatives Supported in the Field of
Sustainability, page 52-53
How Do We Create Value?
Sustainability in İşbank, page 31
Transparent and Ethical Management,
page 132
2023 CDP Climate Change Report
Contribution to Social Welfare, page 166
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.
Profit Distribution Offer
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."adet payın 1
Kuruş nominal değerde pay ile değiştirilmesi nedeniyle A grubu pay
sayısının 40 katı, B grubu pay sayısının 1.5 katı, C grubu pay sayısı
ise aynen dikkate alınır.
The dividends are distributed within the scope of the related
legislation in a manner and at a time determined by the General
Assembly.
The Dividend Distribution Offer of the Board of Directors (depending on the permission to be obtained and the completion of the procedures) will
be submitted for the review of our shareholders on the official website of our Bank, www.isbank.com.tr, on the EGKS portal of MKK and on the Public
Disclosure Platform.
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Directors
Esteemed Shareholders,
Welcome to our Bank’s 100th 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 2023 for your review and approval, we respectfully greet all of you here today.
In 2023, geopolitical uncertainties persisted, while the relatively weak course of global economic growth continued with divergence among
countries. Although inflation lost momentum on a global scale, it continued to hover above central banks' targets. Maintaining their rate hikes
throughout the year, major central banks preferred to wait to monitor the effects of the tightening steps taken in the last quarter of the year.
The Türkiye economy grew by 4.5 per cent in 2023 thanks to the continued strong course of consumption expenditures and the recovery in
investment expenditures following the earthquake disaster. Despite the favourable performance of budget revenues, particularly tax revenues,
increased budget expenditures due to the earthquake disaster and high inflation caused the budget deficit to widen rapidly in 2023.
The banking sector maintained its strong outlook in 2023 and continued to support economic activity. TL loan volume, including loans extended
to the financial sector, increased by 53.5% to TL 7,293 billion as of 29 December 2023. In USD terms, FX loan volume decreased by 3.5% to 121.6
billion USD in the same period. Thus, total loan volume expanded by 52.9% to TRY 10,859 billion as of 29 December 2023. According to exchange
rate adjusted figures, total loan volume expanded by 34.7% in this period.
According to the Weekly Bulletin published by the Banking Regulation and Supervision Agency, as of 29 December 2023, TL deposits including
banks' deposits increased by 85.9% compared to the same period of 2022 and reached 8,308 billion TRY. In USD terms, FX deposit volume
decreased by 8.2% to 191.3 billion USD in this period. The volume of FX-protected deposits, which peaked at TL 3.4 trillion in August, started
to decline following the announcement of the exit strategy on 20 August and fell to TL 2.6 trillion as of 29 December. Thus, as of 29 December
2023, total deposit volume increased by 66.5% compared to the same period of the previous year and reached TL 13,919 billion. Adjusted for the
exchange rate effect, the annual increase in total deposit volume was 42.1%.
As of 31.12.2023 compared to the end of the previous year,
Our loans increased by 51.1% to TL 1,147.4 billion,
ੵ Our deposits increased by 78.5% to TL 1,662.2 billion,
ੵ Our total assets increased by 74.2% to TL 2,453.8 billion,
ੵ Shareholders' equity increased by 39.9% to TL 267.8 billion
has arrived.
In 2023, the Bank maintained its effective risk management and smooth growth policy in credit allocation processes, and its non-performing
loans ratio stood at 2.1% at year-end. In 2023, while maintaining its leadership among private banks in total deposits, the Bank continued to utilise
non-deposit funding opportunities in domestic and foreign markets in order to diversify resources and extend the maturity structure of liabilities by
considering the cost of funding.
Maintaining its strong capital structure, the Bank's capital adequacy ratio stood at 21.6% at the end of 2023, well above the legal limit. The Bank
generated a net profit of TL 72.3 billion in 2023, while return on average equity and return on assets were 33.3% and 3.8%, respectively.
Our Esteemed Shareholders,
We hereby submit our Annual Report, Balance Sheet and Income Statement pertaining to our activities during 2023 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 Assembly Meeting with your attendance.
İŞBANK BOARD OF DIRECTORS
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 Friday, 29 March 2024, at 11:00 at the İş Towers Head Office Auditorium,
34330 Levent/İstanbul.
Agenda of the Ordinary General Assembly
1. Opening Ceremony, establishment of the Council of Chairmanship
2. Discussion of 2023 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 2023
4. To decide on the distribution of the profit for the year 2023, subject to the permission to be obtained and the completion of the procedures
5. To decide on transferring the value increase arising from the revaluation transactions made within the framework of the provisional Article 32 of
the Tax Procedure Law No. 213 from the extraordinary reserves account to the special fund account
6. Determination of the allowance for the members of the Board of Directors
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. Submission for approval of the election of a member for the Board of Directors vacated by Mr Gökhan Şen in accordance with Article 363 of the
Turkish Commercial Code
10. Presenting information to the shareholders about the donations
11. Presenting information to the shareholders on the subjects held in Capital Markets Board Corporate Governance Communique principle no. 1.3.6
12. Presenting information about our bank's decarbonization plan
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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, 2023, 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, 2023 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, IV.e and IV.f the accompanying unconsolidated financial statements as at December 31, 2023 include a free
provision at an amount of TL 10,000,000 thousands of which TL 8,475,000 thousands was provided in prior years and TL 2,000,000 thousands and
TL 3,525,000 thousands were reversed and provided, respectively 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”) and the International Auditing and Accounting Standards Board
(IAASB). 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 International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants (IESBA Code) and have fulfilled our other
responsibilities in accordance with the code of ethics and the IESBA Code. 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, 2023
With Independent Auditor’s Report Thereon
(Convenience Translation of Unconsolidated Financial Statements and
Related Disclosures and Footnotes Originally Issued in Turkish)
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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
Our audit procedures included among others include:
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.
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.
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.
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 2023 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”.
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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Türkiye İş Bankası 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.
THE UNCONSOLIDATED FINANCIAL REPORT AS AT
AND FOR THE YEAR ENDED DECEMBER 31, 2023
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
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:
OTHER EXPLANATIONS
INDEPENDENT AUDITOR’S REPORT
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, 2023, 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.
Güney Bağımsız Denetim ve Serbest Muhasebeci Mali Müşavirlik Anonim Şirketi
A member firm of Ernst & Young Global Limited
Fatma Ebru Yücel, SMMM
Partner
February 13, 2024
Istanbul, Turkey
202
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.
Sadrettin Yurtsever
Member of the Board and
the Audit Committee
Güzide Meltem Kökden
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
İzlem Erdem
Deputy Chief Executive
In Charge of Financial Reporting
Hakan Aran
Chief Executive Officer
The authorized contact person for questions on this financial report:
Name – Surname/Title: Nilgün Yosef Osman/Head of Investor Relations and Sustainability Division
Phone No: +90 212 316 16 02
Fax No:
+90 212 316 08 40
E-Mail:
Nilgun.Osman@isbank.com.tr
investorrelations@isbank.com.tr
Website: www.isbank.com.tr
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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.
Offsetting Financial Instruments
Sale and Repurchase Agreements and Securities Lending Transactions
Non-current Assets Held for Sale and Discontinued Operations and Related Liabilities
XII.
Goodwill and Other Intangible Assets
XIII.
Tangible Assets
XIV.
Leasing Transactions
XV.
Provisions and Contingent Liabilities
XVI.
Contingent Assets
XVII.
Liabilities Regarding Employee Benefits
XVIII. Taxation
XIX.
Borrowings
XX.
Equity Shares and Issuance of Equity Securities
XXI.
Bank Acceptances and Bills of Guarantee
XXII. Government Incentives
XXIII. Segment Reporting
XXIV. Other Disclosures
204
208
208
208
209
209
209
209
210
211
212
214
215
216
218
219
220
220
221
221
221
221
221
223
224
224
224
224
225
225
225
226
226
227
229
229
229
229
229
229
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.
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
VIII.
Disclosures on the Bank’s Domestic, Foreign, Off-Shore Branches or Subsidiaries and Foreign Representative Offices
IX.
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
230
237
246
248
252
253
258
259
259
261
261
277
278
291
299
301
305
306
308
308
308
309
309
309
205
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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, 2023, 38.20% 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 33.71% are on free float (December 31, 2022: Fund 37.31%, CHP 28.09%, Free float 34.60%).
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
Güzide Meltem Kökden
Hakan Aran
Sadrettin Yurtsever
Fazlı Bulut
Durmuş Öztek
Şebnem Aydın
Recep Hakan Özyıldız
Mustafa Rıdvan Selçuk
Ahmet Gökhan Sungur
Gökhan Şen
Chairperson of the Board of Directors, Remuneration Committee, Chairperson of the Risk Committee,
Sustainability Committee, 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, Chairperson of the Corporate Governance Committee, Member of the Audit Committee, Remuneration
Committee, TRNC Internal Systems Committee, Sustainability Committee Risk Committee, Member of the
Operational Risk Committee Corporate Social Responsibility Committee, and the Member of the Board of
Directors Operating Principles Committee
Director, Member of Corporate Social Responsibility Committee, Corporate Governance 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, Member of Corporate Governance Committee, Corporate Social Responsibility Committee, Credit
Committee and Sustainability Committee
Director
Director
Director
Director
Name and Surname
Areas of Responsibility
Hakan Aran
Nevzat Burak Seyrek
Ebru Özsuca
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
I . Deputy General Manager, Affiliates Corporate Architecture, Strategy and Corporate Performance Management,
Information Systems Strategy Committee, Operational Risk Committee and Sustainability Committee Member
Treasury, Economic Research, Capital Markets, Member of the Risk Committee
Corporate and Commercial Banking Marketing, Commercial Banking Sales, Cross-Border Banking, Free Zone
Branches, Member of the Sustainability Committee
SME and Business Banking Marketing, and Sales and , Agricultural Banking Marketing, Commercial Banking
Product, Member of the Corporate Social Responsibility Committee and Sustainability Committee
Information Technologies, Data Management, Acquisition, Artificial Intelligence, Member of Operational Risk
Committee, Sustainability Committee, and Information Technologies Strategic Committee
Retail Banking Marketing, Sales and Product, Personal Loans,Digital Banking, Customer Relations, Payment
Systems Ecosystem, Payment Systems Operations, Payment Systems Product, Member of Operational Risk
Committee, and Member of the Sustainability Committee
Retail, Commercial and Corporate Loans Allocation, Credit Portfolio Management, Project Finance, Member of the
Corporate Social Responsibility Committee, Member of the Risk Committee and Sustainability Committee
Internal Control, Corporate Compliance, Natural Member of the Risk Committee, Information Technologies
Strategic Committee, Member of the Operational Risk Committee and Sustainability Committee
Member of Financial Management, Economic Research, Financial Law and Tax Management Consultancy,
Investor Relations and Sustainability, Management Reporting and Internal Accounting, Risk Committee,
Information Systems Strategy Committee and Sustainability Committee
General Secretariat, Corporate Communications, Private Banking Marketing and Sales, Corporate Social
Responsibility Committee and Member of the Sustainability Committee
Office of legal counsel, Legal Affairs and Legal Proceedings, Loans Monitoring, Retail, Commercial and Corporate
Loans and Retail Loans Proceeding
Banking Operations and Payment Operations, Support Services, External Operations and Commercial Loan
Operations, Member of Operational Risk and sustainability Committee, Human Resources Management,
Construction and Real Estate Management, Talent Management, Consumer Relations Coordination Officer,
Mrs. Gamze Yalcin and Mr. H. Cahit Çınar has left their duties at the Bank..
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)
3,820,190
38.20%
3,820,190
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.
Existing or Potential, Actual or Legal Obstacles on the Transfer of Shareholders’ Equity between the Bank and its Subsidiaries or the Reimbursement of
Liabilities
None.
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
206
207
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Unconsolidated Balancesheet (Statement Of Financial Position)
Unconsolidated Balancesheet (Statement Of Financial Position)
ASSETS
Footnotes
CURRENT PERIOD (31/12/2023)
PRIOR PERIOD (31/12/2022)
THOUSAND TL
LIABILITIES
Footnotes
CURRENT PERIOD (31/12/2023)
PRIOR PERIOD (31/12/2022)
THOUSAND TL
FINANCIAL ASSETS (Net)
I.
1.1
Cash and Cash Equivalents
1.1.1 Cash and Balances with Central Bank
1.1.2 Banks
1.1.3 Money Market Placements
1.1.4 Expected Credit Loss (-)
1.2
1.2.1 Government Debt Securities
1.2.2 Equity Securities
1.2.3 Other Financial Assets
1.3
Financial Assets at Fair Value Through Profit or Loss
Financial Assets at Fair Value Through Other
Comprehensive Income
1.3.1 Goverment Debt Securities
1.3.2 Equity Securities
1.3.3 Other Financial Assets
1.4 Derivative Financial Assets
1.4.1 Derivative Financial Assets at Fair Value Through Profit or Loss
1.4.2 Derivative Financial Assets at Fair Value Through Other
Comprehensive Income
II
FINANCIAL ASSETS MEASURED AT AMORTISED COST
(Net)
Loans
2.1
2.2 Lease Receivables
2.3 Factoring Receivables
2.4 Other Financial Assets Measured at Amortised Cost (Net)
2.4.1 Government Debt Securities
2.4.2 Other Financial Assets
2.5
III.
Expected Credit Loss (-)
ASSETS HELD FOR SALE AND DISCONTINUED
OPERATIONS (Net)
Held for Sale
EQUITY INVESMENTS
Discontinued Operations
Investments in Associates (Net)
3.1
3.2
IV.
4.1
4.1.1 Associates Accounted by Using Equity Method
4.1.2 Unconsolidated Associates
4.2
Subsidiaries (Net)
4.2.1 Unconsolidated Financial Subsidiaries
4.2.2 Unconsolidated Non-Financial Subsidiaries
4.3 Joint Ventures (Net)
4.3.1 Joint Ventures Accounted by Using Equity Method
4.3.2 Unconsolidated Joint Ventures
V. TANGIBLE ASSETS (Net)
VI.
6.1
6.2 Other
VII.
VIII. CURRENT TAX ASSET
IX. DEFERRED TAX ASSET
X.
INVESTMENT PROPERTY (Net)
INTANGIBLE ASSETS (Net)
OTHER ASSETS (Net)
Goodwill
TL
FC
Total
TL
FC
Total
335,832,075
526,004,974
861,837,049
152,182,251
271,580,331
423,762,582
167,328,854
399,143,819
566,472,673
22,339,070
199,486,876
221,825,946
165,816,798
357,686,072
523,502,870
21,699,372
177,230,281
198,929,653
1,556,897
41,702,439
43,259,336
650,374
22,384,255
23,034,629
V-I-a
V-I-ç
0
0
0
0
0
0
44,841
244,692
289,533
10,676
127,660
138,336
V-I-b
3,967,140
19,307,990
23,275,130
4,703,224
9,607,720
14,310,944
290,882
18,649,966
18,940,848
17,029
658,024
675,053
377,411
498,961
9,274,555
9,651,966
333,165
832,126
3,659,229
0
3,659,229
3,826,852
0
3,826,852
V-I-d
164,070,992
89,048,452
253,119,444
124,642,997
45,953,397
170,596,394
163,659,781
86,035,890
249,695,671
124,131,177
44,220,021
168,351,198
160,992
250,219
465,089
465,089
1,845,500
1,167,062
2,006,492
1,417,281
18,504,713
18,969,802
18,504,713
18,969,802
160,992
350,828
496,960
496,960
935,061
798,315
1,096,053
1,149,143
16,532,338
17,029,298
16,532,338
17,029,298
0
0
0
0
0
0
911,625,628
418,720,754 1,330,346,382
555,605,494
287,547,860
843,153,354
760,295,619
411,995,305
1,172,290,924
493,476,961
288,946,360
782,423,321
0
0
0
0
0
0
0
0
0
0
0
0
V-I-c-i
V-I-e
V-I-ı
V-I-f
176,381,503
19,641,458
196,022,961
85,116,372
8,257,625
93,373,997
175,798,169
4,485,146
180,283,315
84,231,448
2,808,785
87,040,233
583,334
15,156,312
15,739,646
884,924
5,448,840
6,333,764
25,051,494
12,916,009
37,967,503
22,987,839
9,656,125
32,643,964
V-I-n
1,540,497
1,540,497
0
97
97
0
1,540,594
1,594,570
6,055
1,600,625
1,540,594
1,594,570
6,055
1,600,625
0
0
0
0
126,780,321
17,672,815
144,453,136
69,572,029
10,287,445
79,859,474
V-I-g
475,064
0
475,064
0
0
0
475,064
399,382
0
0
475,064
399,382
0
0
0
399,382
0
399,382
V-I-ğ
126,305,257
17,672,815
143,978,072
69,172,647
10,287,445
79,460,092
49,792,804
76,512,453
0
0
0
34,144,908
6,385,519
0
17,672,815
67,465,619
27,085,925
10,287,445
37,373,370
0
0
0
0
85,878
13,135
0
76,512,453
42,086,722
0
0
0
0
0
0
0
0
0
0
42,086,722
0
0
0
34,230,786
17,131,994
64,954
17,196,948
6,398,654
3,506,177
8,256
3,514,433
0
0
0
0
6,385,519
13,135
6,398,654
3,506,177
8,256
3,514,433
0
0
12,090,016
0
0
0
0
0
12,090,016
0
0
0
0
0
0
0
0
0
49,288,424
13,598,258
62,886,682
31,917,998
7,317,254
39,235,252
V-I-h
V-I-j
V-I-k
V-I-l
V-I-m
V-I-o
TOTAL ASSETS
1,477,687,388
976,095,911 2,453,783,299
831,510,513
576,812,155 1,408,322,668
DEPOSITS
FUNDS BORROWED
MONEY MARKETS
SECURITIES ISSUED (Net)
Bills
Asset Backed Securities
Bonds
FUNDS
Borrower Funds
Other
FINANCIAL 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
Restrıcturing Provisions
Reserve for Employee Benefits
Insurance Technical Provisions (Net)
Other Provisions
CURRENT TAX LIABILITY
DEFERRED TAX LIABILITY
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.
LIABILITIES RELATED TO ASSETS HELD FOR
SALE AND DISCONTINUED OPERATIONS
(Net)
Held for Sale
Loans
OTHER LIABILITIES
Other Debt Instruments
SUBORDINATED DEBT
Discontinued Operations
13.1
13.2
XIV.
14.1
14.2
XV.
XVI.
16.1
16.2
16.2.1 Share Premium
16.2.2 Share Cancellation Profits
16.2.3 Other Capital Reserves
16.3
Capital Reserves
Paid-in Capital
SHAREHOLDERS’ EQUITY
Profit Reserves
16.5
16.5.1 Legal Reserves
16.5.2 Status Reserves
16.5.3 Extraordinary Reserves
16.5.4 Other Profit Reserves
Profit or Loss
16.6
16.6.1 Prior Periods’ Profit or Loss
16.6.2 Current Period Profit or Loss
Accumulated Other Comprehensive Income or
Loss Not Reclassified Through Profit or Loss
Accumulated Other Comprehensive Income or
Loss Reclassified Through Profit or Loss
16.4
V-II-a
V-II-c
V-II-ç
TL
FC
Total
TL
FC
Total
880,582,226
781,596,468
1,662,178,694
386,133,818
544,943,471
931,077,289
3,321,720
117,444,390
120,766,110
3,366,612
68,088,714
71,455,326
73,959,957
49,220,735
123,180,692
28,009,248
12,090,068
40,099,316
1,297,610
389,926
0
67,188,434
68,486,044
735,314
1,125,240
0
0
2,157,957
1,755,212
0
26,156,146
28,314,103
0
0
1,755,212
0
907,684
66,453,120
67,360,804
402,745
26,156,146
26,558,891
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
V-II-b-g
570,750
6,642,628
7,213,378
2,836,442
6,004,376
8,840,818
570,750
6,642,628
7,213,378
2,836,442
6,004,376
8,840,818
V-II-f
V-II-ğ
V-II-h
V-II-h
V-II-ı
0
0
3,122,464
37,199,142
0
5,644,817
0
31,554,325
9,380,726
0
0
0
0
0
0
144,579
2,721,737
0
0
0
2,721,737
227,171
0
0
0
0
0
0
0
0
0
0
0
0
3,267,043
2,053,406
98,801
2,152,207
39,920,879
29,136,548
1,402,544
30,539,092
0
0
5,644,817
5,507,254
0
34,276,062
9,607,897
0
0
0
0
0
23,629,294
6,531,922
1,080,530
0
0
0
0
0
0
1,402,544
31,008
0
0
0
0
0
5,507,254
0
25,031,838
6,562,930
1,080,530
0
0
0
V-II-i
2,324,411
37,546,571
39,870,982
2,277,824
31,280,921
33,558,745
0
0
0
0
0
0
2,324,411
37,546,571
39,870,982
2,277,824
31,280,921
33,558,745
V-II-e
V-II-j
89,075,939
22,418,157
111,494,096
49,847,129
13,419,108
63,266,237
269,335,765
(1,538,281)
267,797,484
196,315,737
(4,939,662)
191,376,075
10,000,000
1,305,333
110,060
0
1,195,273
44,925,817
0
204
204
0
0
0
10,000,000
10,000,000
1,305,537
110,264
0
1,164,946
108,952
0
1,195,273
1,055,994
0
204
204
0
0
10,000,000
1,165,150
109,156
0
1,055,994
44,925,817
20,188,138
(1,146)
20,186,992
29,752,683
(1,538,485)
28,214,198
44,848,370
(4,938,720)
39,909,650
110,787,175
10,567,141
0
100,220,034
0
72,564,757
299,959
72,264,798
0
0
0
0
0
0
0
0
110,787,175
10,567,141
0
58,410,937
6,168,857
0
100,220,034
52,242,080
0
0
72,564,757
61,703,346
299,959
165,466
72,264,798
61,537,880
0
0
0
0
0
0
0
0
58,410,937
6,168,857
0
52,242,080
0
61,703,346
165,466
61,537,880
208
209
TOTAL LIABILITIES AND SHAREHOLDERS’
EQUITY
1,370,170,710
1,083,612,589
2,453,783,299
709,747,173
698,575,495
1,408,322,668
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Unconsolidated Statement of Off-Balance Sheet Items
Unconsolidated Statement of Off-Balance Sheet Items
OFF-BALANCE SHEET ITEMS
THOUSAND TL
CURRENT PERIOD
(31/12/2023)
PRIOR PERIOD
(31/12/2022)
THOUSAND TL
CURRENT PERIOD
(31/12/2023)
PRIOR PERIOD
(31/12/2022)
A. OFF-BALANCE SHEET CONTINGENCIES and COMMITMENTS (I+II+III)
V-III
944,903,668 1,360,649,227 2,305,552,895 453,428,754 823,573,068 1,277,001,822
3.2
Derivative Financial Instruments Held for Trading
223,262,918
1,035,601,064
1,258,863,982
174,562,525
636,460,954
811,023,479
Footnotes
TL
FC
Total
TL
FC
Total
Footnotes
TL
FC
Total
TL
FC
Total
166,361,635
261,009,169
427,370,804 90,063,305 156,633,209 246,696,514
3.2.1
Forward Foreign Currency Buy/Shell Transactions
42,825,798
144,959,423
187,785,221
9,076,327
53,207,947
62,284,274
I. GUARANTEES AND SURETYSHIPS
1.1
Letters of Guarantee
1.1.1 Guarantees Subject to State Tender Law
1.1.2 Guarantees Given for Foreign Trade Operations
1.1.3 Other Letters of Guarantee
1.2 Bank Acceptance
1.2.1
Import Letter of Acceptances
1.2.2 Other Bank Acceptances
1.3 Letters of Credit
1.3.1 Documentary Letters of Credit
1.3.2 Other Letters of Credit
1.4
1.5
Prefinancing Given as Guarantee
Endorsements
1.5.1
Endorsements to the Central Bank of Turkey
1.5.2 Other Endorsements
1.6
1.7
1.8
Purchase Guarantees for Securities Issued
Factoring Guarrantees
Other Guarantees
1.9
Other Suretyships
II.
2.1
COMMITMENTS
Irrevocable Commitments
2.1.1
Forward Asset Purchase Commitments
2.1.2 Forward Deposit Purchase and Sales Commitments
2.1.3 Capital Commitments to Associates and Subsidiaries
2.1.4
Loan Granting Commitments
2.1.5
Securities Underwriting Commitments
2.1.6 Commitments for Reserve Deposit Requirements
2.1.7 Commitments for Cheque Payments
2.1.8
Tax and Fund Liabilities from Export Commitments
2.1.9 Commitments for Credit Card Expenditure Limits
2.1.10 Commitments for Credit Cards and Banking Services Promotions
2.1.11 Receivables from Short Sale Commitments
2.1.12 Payables for Short Sale Commitments
2.1.13 Other Irrevocable Commitments
2.2
Revocable Commitments
2.2.1
Revocable Loan Granting Commitments
2.2.2 Other Revocable Commitments
III.
DERIVATIVE FINANCIAL INSTRUMENTS
3.1
Derivative Financial Instruments Held for Risk Management
3.1.1 Fair Value Hedges
3.1.2 Cash Flow Hedges
3.1.3 Net Foreign Investment Hedges
3.2.1.1 Forward Foreign Currency Buy Transactions
30,202,278
64,272,380
94,474,658
6,486,754
24,879,081
31,365,835
3.2.1.2 Forward Foreign Currency Sell Transactions
12,623,520
80,687,043
93,310,563
2,589,573
28,328,866
30,918,439
3.2.2
Currency and Interest Rate Swaps
3.2.2.1 Currency Swap Buy Transactions
3.2.2.2 Currency Swap Sell Transactions
3.2.2.3
Interest Rate Swap Buy Transactions
3.2.2.4 Interest Rate Swap Sell Transactions
149,898,697
741,715,311
891,614,008
158,868,495
505,601,396
664,469,891
2,037,254
209,617,080
211,654,334
12,686,066
180,280,643
192,966,709
138,999,761
109,982,177
248,981,938
144,722,429
72,885,673
217,608,102
4,430,841
211,058,027
215,488,868
730,000
126,217,540
126,947,540
4,430,841
211,058,027
215,488,868
730,000
126,217,540
126,947,540
3.2.3
Currency, Interest Rate and Security Options
29,527,399
83,633,384
113,160,783
5,720,382
23,965,147
29,685,529
156,795,251
163,158,878
319,954,129
84,315,803
94,966,881
179,282,684
1,508,058
1,770,160
3,278,218
1,344,063
1,143,615
16,505,345
65,374,380
81,879,725
11,143,447
40,608,395
2,487,678
51,751,842
138,781,848
96,014,338
234,796,186
71,828,293
53,214,871
125,043,164
9,435,050
6,365,084
15,800,134
5,576,890
3,754,586
9,331,476
0
2,860,295
2,860,295
0
667,717
667,717
9,435,050
3,504,789
12,939,839
5,576,890
3,086,869
8,663,759
131,334
85,253,610
85,384,944
170,612
53,075,611
53,246,223
116,178
53,169,024
53,285,202
133,794
33,011,590
33,145,384
15,156
32,084,586
32,099,742
36,818
20,064,021
20,100,839
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
6,231,597
6,231,597
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
555,279,115
64,038,994
619,318,109 188,802,924
30,478,905
219,281,829
552,192,438
56,358,660
608,551,098 186,639,578
22,139,127
208,778,705
2,642,935
25,460,753
28,103,688
0
0
0
0
0
0
980
0
1,000,000
4,515,325
4,516,305
0
0
0
1,000,000
118,244,588
3,632,293
121,876,881
65,197,193
2,105,002
67,302,195
0
0
9,204,813
22,019
417,894,567
1,085,145
0
0
0
0
0
0
0
0
0
0
0
0
0
0
9,204,813
5,447,537
22,019
22,490
417,894,567
112,111,363
1,085,145
277,375
0
0
0
0
0
0
0
0
0
0
0
0
3,098,371
27,265,614
30,363,985
2,582,640
15,518,800
3,086,677
7,680,334
10,767,011
2,163,346
8,339,778
3,086,677
7,680,334
10,767,011
2,128,346
8,339,778
0
0
5,447,537
22,490
112,111,363
277,375
0
0
18,101,440
10,503,124
10,468,124
3.2.3.1 Currency Call Options
3.2.3.2 Currency Put Options
3.2.3.3
Interest Rate Call Options
3.2.3.4
Interest Rate Put Options
3.2.3.5 Securities Call Options
3.2.3.6 Securities Put Options
3.2.4 Currency Futures
3.2.4.2 Currency Sell Futures
3.2.5
Interest Rate Futures
3.2.5.1
Interest Rate Buy Futures
3.2.5.2
Interest Rate Sell Futures
3.2.6
Other
4.5
Other Assets Received for Collection
4.6
4.7
4.8
V.
5.1
Assets Received for Public Offering
Other Items Under Custody
Custodians
PLEDGED ITEMS
Marketable Securities
4,836,131
4,836,131
3.2.4.1 Currency Buy Futures
0
0
0
35,000
0
35,000
223,262,918 1,035,601,064 1,258,863,982 174,562,525 636,460,954
811,023,479
5.2
Guarantee Notes
5.3
Commodity
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
5.4
5.5
5.6
5.7
VI.
Warranty
Real Estates
Other Pledged Items
Pledged Items-Depository
ACCEPTED BILL, GUARANTEES AND
SURETIES
TOTAL OFF-BALANCE SHEET COMMITMENTS
(A+B)
19,595,726
31,548,029
51,143,755
3,160,239
8,188,359
11,348,598
9,931,673
40,567,339
50,499,012
2,560,143
8,132,464
10,692,607
0
0
0
0
1,011,024
1,010,147
0
0
0
0
5,759,008
5,759,008
5,759,008
5,759,008
0
0
0
0
983,012
1,994,036
854
0
0
0
1,011,001
983,035
0
0
0
64,309,934
64,309,934
877
982,158
0
0
0
0
897,321
192,908
704,413
0
0
0
0
3,822,162
3,822,162
3,822,162
3,822,162
0
0
0
0
743,203
1,640,524
559,500
183,703
752,408
888,116
0
0
0
0
0
0
52,943,261
52,943,261
0
0
0
0
0
0
0
0
0
0
0
0
2,171,028
65,983,810
68,154,838
1,496,460
38,672,933
40,169,393
0
0
0
0
0
0
1,556,096,393 2,211,290,088 3,767,386,481
1,031,977,996
1,323,212,755 2,355,190,751
86,209,507
2,892,895
89,102,402
67,423,981
800,624
68,224,605
2,675,646
59,365,740
62,041,386
2,550,997
35,205,788
37,756,785
333,823,180
299,866,550
633,689,730
235,924,378
132,452,520
368,376,898
0
0
0
0
0
0
825,270,280
1,429,400,134
2,254,670,414
561,535,101
876,040,583 1,437,575,684
308,117,780
419,764,769
727,882,549
164,543,539
278,713,240
443,256,779
0
0
0
0
0
0
0
0
0
0
0
0
2,618,089,853 3,824,434,413 6,442,524,266 1,569,678,410 2,319,462,766
3,889,141,176
B.
IV.
CUSTODY AND PLEDGES RECEIVED (IV+V+VI)
1,673,186,185 2,463,785,186 4,136,971,371
1,116,249,656 1,495,889,698 2,612,139,354
ITEMS HELD IN CUSTODY
117,089,792
252,495,098
369,584,890
84,271,660
172,676,943 256,948,603
4.1
Customers’ Securities Held
4.2
4.3
Investment Securities Held in Custody
Cheques Received for Collection
0
0
0
0
0
0
41,835,247
4,612,715
46,447,962
34,788,786
4,899,694
39,688,480
68,211,213
122,389,192
190,600,405
44,145,057
93,149,806
137,294,863
4.4
Commercial Notes Received for Collection
4,872,304
59,509,381
64,381,685
3,841,357
35,954,510
39,795,867
210
211
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Unconsolidated Income Statement
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
I.
1.1
1.2
1.3
1.4
1.5
1.5.1
1.5.2
1.5.3 Financial Assets At Measured at Amortised Cost
1.6
1.7
II.
2.1
2.2
2.3
2.4
2.5
2.6
III.
IV.
4.1
4.1.1 Non-cash Loans
4.1.2 Other
4.2
4.2.1 Non-cash Loans
4.2.2 Other
V.
VI.
6.1
6.2
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 COMMISSSIONS INCOME
Fees and Commissions Received
DIVIDEND INCOME
TRADING INCOME /(LOSS) (Net)
Gains /(Losses) on Securities Trading
Derivative Financial Transactions Gains/Losses
Fees and Commissions Received
PROFIT/LOSS FROM ASSOCIATES ACCOUNTED FOR USING THE EQUITY METHOD
Foreign Exchange Gains / (Losses)
OTHER OPERATING INCOME
EXPECTED CREDIT LOSS (-)
OTHER PROVISION EXPENSES (-)
PERSONNEL EXPENSE (-)
OTHER OPERATING EXPENSES (-)
6.3
VII.
VIII. GROSS OPERATING INCOME (III+IV+V+VI+VII)
IX.
X.
XI.
XII.
XIII. NET OPERATING INCOME/(LOSS) (VIII-IX-X-XI-XII)
XIV. AMOUNT IN EXCESS RECORDED AS GAIN AFTER MERGER
XV.
XVI. NET MONETARY POSITION GAIN/LOSS
XVII. PROFIT/LOSS ON CONTINUING OPERATIONS BEFORE TAX (XIII+...+XVI)
XVIII. TAX PROVISION FOR CONTINUING OPERATIONS(±)
18.1
Current Tax Provision
18.2 Deferred Tax Income Effect (+)
18.3 Deferred Tax Expense Effect (-)
XIX. NET PERIOD PROFIT/LOSS FROM CONTUNUING OPERATIONS (XVI±XVII)
XX.
20.1
20.2 Gain on Sale of Associates, Subsidiaries and Jointly Controlled Entities (Joint Ventures)
20.3 Other Expense on Discontinued Operations
XXI.
21.1
21.2 Gain on Sale of Associates, Subsidiaries and Jointly Controlled Entities (Joint Ventures)
21.3 Other Expense on Discontinued Operations
XXII. PROFIT/LOSS ON DISCONTINUED OPERATIONS BEFORE TAX (XX-XXI)
XXIII. TAX PROVISION FOR DISCONTINUED OPERATIONS (±)
23.1 Current Tax Provision
23.2 Deferred Tax Expense Effect (+)
23.3 Deferred Tax Income Effect (-)
XXIV. NET PERIOD PROFIT/LOSS FROM DISCONTINUED OPERATIONS (XXII±XXIII)
XXV. NET PERIOD PROFIT/LOSS (XIX+XXIV)
EXPENSE ON DISCONTINUED OPERATIONS (-)
Expense on Assets Held for Sale
INCOME ON DISCONTINUED OPERATIONS
Income on Assets Held for Sale
Earnings per Share(*)
(*) Expressed in exact TL.
212
THOUSAND TL
Footnote
V-IV-a
CURRENT PERIOD
(01/01-31/12/2023)
222,485,981
PRIOR PERIOD
(01/01-31/12/2022)
123,454,753
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
149,492,535
774,829
809,161
651,664
70,564,918
423,512
42,160,970
27,980,436
0
192,874
155,412,822
122,026,589
7,034,230
7,964,658
7,409,098
595,082
10,383,165
67,073,159
42,437,948
51,584,591
3,677,579
47,907,012
9,146,643
1,680
9,144,963
65,258
12,223,362
7,319,325
(6,033,727)
10,937,764
13,586,616
135,386,343
15,906,083
4,164,824
25,307,024
46,921,938
43,086,474
0
33,996,027
0
77,082,501
4,817,703
10,215,857
4,790,964
10,189,118
72,264,798
0
0
0
0
0
0
0
0
0
0
0
0
0
0
V-IV-ı
72,264,798
0.289056590
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
Türkiye İş Bankası A.Ş.
Unconsolidated Statement of Profit or Loss and Other Comprehensive Income
PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
I.
II.
PROFIT/LOSS FOR THE PERIOD
OTHER COMPREHENSIVE INCOME
2.1 Other comprehensive income that will not be reclassified to profit or loss
2.1.1 Revaluation Surplus on Tangible Assets
2.1.2 Revaluation Surplus on Intangible Assets
2.1.3 Gains / (Losses) on remeasurements of Defined Benefit Plans
2.1.4 Other Income/ Expense Items of Other Comprehensive Income not to be Reclassified to Profit Or Loss
2.1.5 Taxes Relating To Components Of Other Comprehensive Income not to be Reclassified To Profit Or Loss
2.2 Other Income/ Expense Items not be Reclassified to Profit or Loss
2.2.1 Exchange Differences on Translation
THOUSAND TL
CURRENT PERIOD
(01/01-31/12/2023)
PRIOR PERIOD
(01/01-31/12/2022)
72,264,798
61,537,880
13,043,373
43,834,286
24,738,825
12,347,585
13,720,641
7,126,488
0
0
88,357
(2,593,679)
11,006,113
(76,286)
8,119,452
(304,676)
(11,695,452)
31,486,701
6,240,721
2,071,370
2.2.2 Valuation and/or Reclassification Profit or Loss from Financial Assets at Fair Value through Other Comprehensive Income
(30,300,163)
32,024,551
2.2.3 Income/ (Loss) Related with Cash Flow Hedges
2.2.4 Income/ (Loss) Related with Hedges of Net Investments in Foreign Operations
2.2.5 Other Income/ Expense Items of Other Comprehensive Income to be Reclassified to Other Profit or Loss
2.2.6 Taxes Relating To Components Of Other Comprehensive Income to be Reclassified To Profit Or Loss
III.
TOTAL COMPREHENSIVE INCOME (I+II)
0
(1,121,189)
5,636,528
7,848,651
0
0
5,517,021
(8,126,241)
85,308,171
105,372,166
213
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Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Unconsolidated Statement of Changes in Shareholders’ Equity
Unconsolidated Statement of Changes in Shareholders’ Equity
CHANGES IN SHAREHOLDERS’ EQUITY
Dipnot
Paid-in
Capital
Share
Premium
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
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
Accumulated Other Comprehensive Income That
will not be Reclassified in Profit / (Loss)
Accumulated Other Comprehensive Income That will be
Reclassified in Profit / (Loss)
PPRIOR 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
Paid-in Capital inflation adjustment difference
Convertible Bonds
Subordinated Debt
Increase /(Decrease) Through Other Changes
8
51,703
Profit Distribution
Dividend Paid
Transfer to Reserves
Other
(5,500,000)
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
CURRENT PERIOD ( 31/12/2023)
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
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
61,703,346
191,376,075
10,000,000
109,156
1,055,994
10,285,200
(2,746,498)
12,648,290
13,487,763
244,949
11,006,113
5,292,088
6,240,721
24,558,125
10,059,437
58,410,937
61,703,346
(22,787,869)
4,851,696
72,264,798
191,376,075
85,308,171
Increase/(Decrease) Through Other Changes
1,108
139,279
Profit Distribution
Dividend Paid
Transfer to Reserves
Other
(96,427)
52,472,665
52,472,665
33,308
(61,436,695)
(8,964,030)
(52,472,665)
77,268
(8,964,030)
(8,964,030)
Ending Balance (III+IV+ +X+XI)
10,000,000
110,264
1,195,273
23,772,963
-2,501,549
23,654,403
11,532,809
1,770,256
14,911,133
110,787,175
299,959
72,264,798
267,797,484
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
(1) Accumulated amounts of other comprehensive income of invesments accounted by the equity method, that will not be classified as other pprofit or loss and that will be
classified as other profit or loss
(2) Accumulated amounts of other comprehensive income of invesments accounted by the equity method, that will be classified as other pprofit or loss and that will be
classified as other profit or loss
214
215
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Unconsolidated Statement of Cash Flows
Türkiye İş Bankası A.Ş.
Unconsolidated Statement of Profit Distribution Table
THOUSAND TL
Footnotes
CURRENT PERIOD
(01/01-31/12/2023)
PRIOR PERIOD
(01/01-31/12/2022)
THOUSAND TL
CURRENT PERIOD
(01/01-31/12/2023)
PRIOR PERIOD
(01/01-31/12/2022)
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
CASHFLOWS 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
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
(*) Includes Redeemed Financial Assets measured at amortized cost.
V-VI
V-VI
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.
216
32,546,281
182,278,174
(131,447,615)
2,423,241
51,446,184
11,287,992
4,952,565
(51,530,123)
(10,269,161)
(26,594,976)
394,991,417
(2,147,721)
(41,918,417)
(302,252,747)
(12,891,920)
82,791,486
543,610,294
0
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
13,276,407
(14,214,342)
0
114,524,035
427,537,698
0
18,620,820
86,077,417
(173,244,562)
(75,342,524)
(9,250,000)
(3,714,714)
0
(3,394,099)
125,706
0
(1,325,592)
218,743
(123,991,414)
(59,932,987)
48,350,817
27,825,705
(120,829,692)
39,873,429
(4,129,309)
5,862,857
36,594,109
(17,363,092)
0
(12,056,191)
(1,311,969)
0
5,094,705
265,250,698
94,614,002
359,864,700
(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
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 ( % )
77,082,501
4,817,703
9,929,002
286,855
(5,398,154)
72,264,798
0
0
0
72,264,798
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
0.2891
723
0
0
0
0
0
0
77,207,514
12,411,168
17,082,925
121,205
(4,792,962)
64,796,346
0
4,398,284
476,341
59,921,721
600,000
599,998
2
0
0
0
3,092,161
0
8,630,682
8,630,411
232
39
0
0
0
47,598,878
0
0
0
0
0
0
0
0
0
0
0
0.2461
615
0
0
0.0369
92.30
0.0780
780.32
(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 165.466 allocated for the profit share to be distributed to the personel in 2022 and added to the profit distribution base of the same year, and TL
3.093.000 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.
217
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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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.
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. With the announcement made on November
23 2023, POA stated that, entities that is applying TFRS on their financial statements for the annual reporting period ending on or after 31 December 2023 should be
presented by adjusting for the inflation effect in accordance with the relevant accounting principles in the TAS 29 standard, on the other hand, He explained that institutions or
organizations authorized to regulate and supervise may determine different transition dates in their own fields for the implementation of TMS 29 provisions. In accordance with
the BRSA’s decision dated December 12 2023 and numbered 10744, the financial statements of banks and financial leasing, factoring, financing, savings financing and asset
management companies dated 31 December 2023 will not be subject to the inflation adjustment required within the scope of TMS 29. and In accordance with the Decision
No. 10825 dated January 11 2024 , it was decided to switch to inflation accounting as of January 1, 2025. Accordingly, TMS 29 was not applied and no inflation adjustment
was made in the financial statements dated 31 December 2023.
TFRS 17 “Insurance Contracts” standard, published by POA on 16.02.2019 to be applied for accounting periods starting after 31.12.2023, determines the principles regarding
the recognition, measurement, presentation, and disclosure of insurance contracts within the scope of the standard. The purpose of TFRS 17 is to ensure that entities display
these contracts fairly. POA has decided to apply TFRS 17 on consolidated and individual financial statements of companies as of 01.01.2024. In this context, the relevant
standard has not been applied in the financial statements dated 31.12.2023.
Within the scope of the project to change the benchmark interest rates carried out by the International Accounting Standards Board (IASB), the “Benchmark Interest Rate
Reform - 2nd stage” which brings changes to various TAS / TFRS, effective as of January 1, 2021, was published in December 2020. As of June 30, 2023, the Secured
Overnight Financing Rate (SOFR) has started to be used in open transactions with variable interest rates indexed to USD LIBOR. The mentioned changes did not have a
significant impact on the Bank’s financial statements as of December 31, 2023.
The accounting policies applied in the current period are in line with the prior period Unconsolidated 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.
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.
The Bank has been applying net investment hedging accounting to the portion of its net investment amounting to EUR 397 million in its subsidiary Isbank AG, headquartered
in Germany and whose functional currency is the Euro, which it accounts for using the equity method, in order to protect against exchange difference risk since November
2023. The part of the demand euro deposit that is subject to hedge accounting has been determined as a hedging instrument. Currency-related changes in the portion of
demand foreign currency deposits subject to hedge accounting are accounted for in equity under “Accumulated Other Comprehensive Income or Expenses Reclassified in
Profit or Loss”.
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.
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.
V.
Interest Income and Expenses
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.
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.
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.
VI.
Fees and Commission Income and Expenses
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.
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.
218
219
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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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.
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.
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.
Stage 2:
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.
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. In 2023, loss at default models were
updated in individual and commercial portfolios, and statistical models that estimate the loss at default parameter through decision trees differentiated according to risk
variables in the relevant portfolios began to be used in expected credit loss calculations. 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. 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.
220
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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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 LGD forecasting based on the Bank’s historical
collection data, statistical models are used to explain the LGD ratios formed in past periods, taking into account the direct cost items in the collection process, using risk
variables that differ for each credit risk group
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.
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”. 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 companies, are recorded under the shareholders’ equity in current period.
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.
Within the scope of the TFRS 16 standard, development costs related to leases that cannot be added to the cost of the right-of-use asset and are within the scope of
exceptions in the mentioned standard are amortized in equal amounts, taking into account the useful-life period. 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.
On the other hand, the possible effects of the earthquake disaster that occurred on 06.02.2023 on the loan portfolio have been the subject of expected loan loss calculations
on the basis of loan classes, taking into account the current regulations and data on the subject.
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.
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).
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:
Buildings
Safe Boxes
Other Movables
XIV.
Leasing Transactions
Estimated Economic Life (Year)
Depreciation Rate
50
2-50
2-25
2%
2% - 50%
4% - 50%
The bank accounts for its leases within the scope of the “TFRS 16-Leases” standard (TFRS 16). For contracts within the scope of TFRS 16, right-of-use assets and lease
liabilities are reflected in the financial statements, and these are shown under “Tangible Assets” and “Leasing Transaction Liabilities “, respectively.
In accordance with TFRS 16, the right of use asset is first measured at cost. The cost of the right-of-use asset consists of the present value of the lease payments as of
the date the lease obligation begins, the amount obtained by deducting all lease incentives received, and the sum of all initial direct costs incurred by the lessee. The bank
measures right-of-use assets using the cost method. Fixed assets accounted for as right-of-use assets are depreciated taking into account the contract period.
In accordance with TFRS 16, the lease liability is calculated by discounting future lease payments using the Bank’s borrowing interest rate at the date of initial application or
contract. The interest on the lease liability for each period in the lease term is the amount found by applying a fixed periodic interest rate to the remaining balance of the lease
liability. Interest expenses and exchange differences related to lease liabilities are associated with the profit or loss statement.
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.
XV.
Provisions and Contingent Liabilities
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.
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.
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.
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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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, 2023. 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.
On the other hand, within the scope of the temporary article added to the Social Insurance and General Health Insurance Law No. 5510 dated 31.5.2006 by Law No. 7438
published in the Official Gazette No. 32121 dated 01.03.2023, those who request to receive a pension after the effective date of the relevant article are subject to the relevant
regulations. Accordingly, those who will be granted old-age or retirement pensions are given the opportunity to benefit from old-age and retirement pensions if they meet other
conditions other than age in the said provisions.
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:
Pursuant to the amendment made in Article 32 of the Corporate Tax Law with the Law No. 7394, the corporate tax rate has been determined as 25%, starting from the
declarations that must be submitted as of 01.07.2022 and being valid for the corporate earnings for the taxation period starting from 01.01.2022. On the other hand, the
Law No. 7456 published in the Official Gazette No. 32249 dated 15.07.2023 and the Corporate Tax Law No. 32. in accordance with the amendment made to the article, the
corporate tax rate has been determined as 30% starting from the returns that must be submitted as of 01.10.2023 and applying to corporate earnings of institutions for the
year 2023 and subsequent taxation periods. The Corporate Tax rate valid for the period of December 31, 2023, is 30%.
As per the Corporate Tax law, temporary tax is calculated and in the first nine months of the year 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.
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.
On the other hand, with the Law No. 7456 published in the Official Gazette dated 15.07.2023 and numbered 32249, the exception for 50% of the income arising from the
sale of immovables in Article 5.1.e of the Corporate Tax Law has been abolished. However, pursuant to the temporary article 16 added to the Corporate Tax Law with the 22nd
article of the Law No. 7456, the pre-amendment provisions will be taken into consideration for the immovables included in the assets of the institutions before 15.07.2023. The
50% rate will be applied as 25% for the real estate sales earnings to be made after 15.07.2023.
In accordance with the provision of Article 298/A of the Tax Procedure Law (TPL), 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, 2022 and 2023 accounting periods, including the provisional tax periods, were
not subjected 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.
VUK Temporary 33. profit / loss differences arising from the inflation adjustment made on 31.12.2023 in accordance with the article and which must be shown in the profit/
loss accounts for previous years do not affect the corporate tax base. However, Some Laws and Decrees with the Force of Law No. 7491 regulate by Law on Amendments to
Decrees with the Force of Law, the difference in profit / loss caused by the inflation adjustment that Banks will make in the 2024 and 2025 accounting periods, including the
temporary tax periods, the difference in profit / loss caused by the inflation adjustment that Banks will make in the 2024 and 2025 accounting periods, the determination of
Banks’ 2024 and 2025 accounting earnings.
With the arrangements in TPL Repeated 298 (Ç) and Provisional Article 32, taxpayers have been given the opportunity of revaluation within the scope defined within the
framework of the General Communiqué of TPL No. 537. In this framework, it is possible for taxpayers who want to benefit from the revaluation application by enabling
the revaluation of depreciable economic assets and immovables. The Bank revalues some of its depreciable assets that meet the relevant criteria within the scope of the
opportunities provided.
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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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Pursuant to the amendment made in Article 32 of the Corporate Tax Law with the Law No. 7394, the corporate tax rate has been determined as 25%, starting from the
declarations that must be submitted as of 01.07.2022 and being valid for the corporate earnings for the taxation period starting from 01.01.2022. On the other hand, in
accordance with the Law No. 7456 published in the Official Gazette dated 15.07.2023 and numbered 32249 and the amendment made in Article 32 of the Corporate Tax Law,
the corporate tax rate should start from the declarations that must be submitted as of 01.10.2023 and it has been determined as 30% to be applied to the corporate earnings of
the institutions for the year 2023 and the following taxation periods. The Corporate Tax rate valid for the period of December 31 2023, is 30%.
Provisional 33 of the Tax Procedure Code. in December 31, 2023, according to the article, the tax effects arising from the inflation adjustment of corporate tax are included in
the deferred tax calculation as of December 31, 2023.
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 in the UK are subject to corporation tax at a rate of 19%.however, as of April 1, 2023, the corporate tax rate for companies with commercial profits over GBP
250 thousand has been set at 25%. 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)
XXI. Bank Acceptances and Bills of Guarantee
Current Period
72,264,798
250,002,250
0.289056590
Prior Period
61,537,880
250,002,250
0.246149305
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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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
SECTION FOUR: INFORMATION ON THE FINANCIAL POSITION AND RISK MANAGEMENT OF THE BANK
1. Explanations on Shareholders’ Equity
The capital adequacy standard ratio of the bank is 21.60%. (31.12.2022: 24.36%). 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 31.01.2023, numbered 10496. Within the scope of the BRSA decisions, the amount subject to credit risk has been calculated by using
the CBRT exchange rates as of 30.12.2022, 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” acquired before the Board decision dated 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
Current and prior periods' losses not covered by reserves, and losses accounted under equity according to TAS
Leasehold improvements on operational leases
Goodwill Netted with Deferred Tax Liabilities
Current Period
Prior Period
11,615,938
110,264
109,918,946
87,102,784
72,564,757
72,264,798
299,959
11,615,938
109,156
57,746,955
68,855,410
61,703,346
61,537,880
165,466
281,312,689
200,030,805
8,064,503
155,355
3,343,330
97,709
Other Intangible Assets Netted with Deferred Tax Liabilities Except Mortgage Servicing Rights
6,146,456
3,201,916
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
Current Period
Prior Period
14,896,621
266,416,068
7,173,262
192,857,543
Excess Amount arising from Deferred Tax Assets from Temporary Differences
Other items to be defined by the regulator
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
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 (-)
Deduction from Additional Tier I Capital when there is not enough Tier II Capital (-)
Total Deductions from Additional Tier I Capital
Total Additional Tier I Capital
Total Tier I Capital (Tier I Capital= Common Equity Tier I Capital + Additional Tier I Capital)
266,416,068
192,857,543
TIER II CAPITAL
Debt Instruments and the Related Issuance Premiums Defined by the BRSA
35,660,250
25,342,500
530,307
530,307
Debt Instruments and the Related Issuance Premiums Defined by the BRSA (Covered by Temporary Article 4)
Provisions (Amounts explained in the first paragraph of the article 8 of the Regulation on Bank Capital)
Tier II Capital Before Total Deductions
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
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
16,914,796
52,575,046
10,893,301
36,235,801
52,575,046
318,991,114
3,230
3,230
36,235,801
229,093,344
2,650
2,650
228
229
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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Current Period
Prior Period
Information on Subordinated Liabilities:
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
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
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
Remaining Mortgage Servicing Rights
Net Deferred Tax Assets arising from Temporary Differences
Limits for Provisions Used in Tier II Capital Calculation
General Loan Provisions for Exposures in Standard Approach (before limit of one hundred and twenty five per ten
thousand)
General Loan Provisions for Exposures in Standard Approach Limited by 1,25% of Risk Weighted Assets
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
318,987,884
1,477,106,016
229,090,694
940,288,051
18.04
18.04
21.60
2.56
2.50
0.06
0
12.04
20.51
20.51
24.36
2.56
2.50
0.06
0
14.51
453,026
385,225
12,090,016
20,559,215
16,914,796
16,381,640
10,893,301
Issuer
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Unique identifier (CUSIP, ISIN etc.)
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.
Subject to 10% deduction as of 1/1/2015
No
No
Eligible at unconsolidated/consolidated
Unconsolidated -Consolidated
Unconsolidated -Consolidated
Bond
11,774
14,718
Bond
22,076
22,076
Subordinated Liabilities
Subordinated Liabilities
29.06.2017
Dated
11 Years
Yes
22.01.2020
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: (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
9.192%
None.
None.
None.
Noncumulative
None.
None.
Fixed
7.75%
None.
None.
None.
Noncumulative
None.
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
Issuer call subject to prior supervisory (BRSA)
approval
Optional call date, contingent call dates and
redemption amount
Subsequent call dates, if applicable
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
Noncumulative or cumulative
Convertible or non-convertible
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
230
231
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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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.
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
If write-down, permanent or temporary
Permanent
Partially or completely
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.
Incompliance with article number 7 and 8 of “Own
fund regulation”
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.
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
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 1/1/2015
No
No.
No
Eligible at unconsolidated / consolidated
Unconsolidated – Consolidated
Unconsolidated - Consolidated
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
660
Nominal value of instrument (TL Million)
1,100
Bond
800
800
Bond
350
350
Subordinated Liabilities
Subordinated Liabilities
Subordinated Liabilities
Accounting classification
Original date of issuance
Perpetual or dated
Original maturity date
08.08.2017
Dated
10 Years
Issuer call subject to prior supervisory approval
Yes
19.06.2019
Dated
10 Years
Yes
26.09.2019
Dated
10 Years
Yes
Optional call date, contingent call dates and
redemption amount
The Bank; (1) can purchase bills
The Bank; (1) can purchase bills
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
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
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
Borsa İstanbul Turkish Lira Overnight
Reference Interest Rate Index + 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
Convertible into equity shares
None.
Non-cumulative
None.
Non-cumulative
None.
If convertible, conversion trigger (s)
If convertible, fully or partially
If convertible, conversion rate
232
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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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
Permanent
If temporary write-down, description of write-
up mechanism
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
Shareholders’ equity
Leasehold improvements on operational leases
Goodwill and intangible assets
Provision
Subordinated debt
Deductions from shareholders’ equity
Capital
Carrying Amount
Amounts in Equity
Calculation (*)
267,797,484
155,355
6,398,654
20,559,215
39,870,982
3,230
272,717,879
(155,355)
(6,146,456)
16,914,796
35,660,250
(3,230)
318,987,884
(*) 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 31.01.2023 and numbered 10496.
234
II.
Explanations on Credit Risk
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 (**)
825,274,819
692,397,993
231,954
337,707
942,716
73,175,870
590,106,579
303,266,421
48,487,544
42,015,943
6,082,919
175,792,914
3,811,338
99,041,129
139,830,305
216,647
333,381
984,361
66,052,668
558,487,922
265,431,203
43,619,880
37,420,796
4,796,173
122,949,798
4,147,609
86,530,810
108,696,999
235
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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, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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 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 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.
Type of Collateral
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. The share of the Bank’s receivables from the top 100 and 200 cash loan customers in the overall cash loan portfolio stands at 27%, 35%, respectively
(December 31, 2022: 28%, 36%).
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, 2022: 42%, 54%).
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 14%,
19%, respectively (December 31, 2022: 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.
Current Period
Prior Period
Net Value of the
Collateral
Loan Balance
Net Value of the
Collateral
Loan Balance
Real Estate Mortgage (*)
6,228,200
6,228,200
5,485,809
5,485,809
Cash Collateral
Vehicle Pledge
Other (Suretyship, commercial enterprise under pledge,
commercial papers, etc.)
1,406
258,097
1,406
258,097
1,854
253,411
1,854
253,411
9,126,176
9,126,176
8,010,972
8,010,972
(*) 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 (*)
31-60 Days (**)
61-90 Days (**) (***)
Total
Loans
Corporate / Commercial Loans
Consumer Loans
Credit Cards
Total
283,522
633,643
2,169,444
3,086,609
236,892
260,241
723,603
1,220,736
520,414
893,884
2,893,047
4,307,345
7. The total value of the stage 1 and stage 2 expected credit loss allocated for credit risk stands at TL 18,941,570 (December 31, 2022: TL 15,381,907).
(*) The loans classified as closely monitored that are not past due or past due for less than 31 days is TL 93,878,417.
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”.
(**) 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 874,533 and TL 1,943,686 respectively.
Prior Period (*)
31-60 Days (**)
61-90 Days (**)
Total
Strong
Standard
Below Standard
The table data comprises behavior rating/scoring results.
Current Period
Prior Period
54.21%
38.36%
7.43%
50.00%
44.71%
5.29%
Loans
Corporate / Commercial Loans
Consumer Loans
Credit Cards
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
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
Current Period
Commercial and
Corporate
Credit Cards
Personal
Prior Period
Commercial and
Corporate
Credit Cards
Real Estate Mortgage (*)
1,830,376
7,773,099
1,227,513
8,211,635
Cash Collateral (Cash, securities
pledge, etc.)
61,142
593,167
47,812
478,666
(*) 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 854,981and TL 1,646,781 respectively.
Pledge on Wages and Vehicles
4,716,955
542,740
1,993
3,092,378
369,527
1,907
387,930
52,014,318
456,308
33,996,002
Cheques & Notes
Other (Suretyship, commercial
enterprise under pledge, commercial
papers, etc.)
Non-collateralized
11,255,463
7,018,934
14,807,864
7,029,998
11,101,472
3,941,709
Total
18,251,866
67,944,251
14,807,864
11,854,009
54,159,209
3,941,709
(*) 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.
236
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Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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
808,994,471
5
672,528
15,607,815
825,274,819
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
231,929
337,403
742,659
200,057
25
304
21,594,164
28,651,823
14,709,426
674,754
2,928,035
4,617,668
561,949,812
2,206,427
8,060,340
3,061,481
35,752
14,792,767
298,363,681
958,731
433,683
4,341
154,795
3,351,190
89,402,875
235,894
199,472
3,122
60,984
601,140
Non-Performing Receivables
6,011,512
33,256
5,451
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
174,207,343
85,023
11,922
3,811,338
8
82
9,102
23,590
18,811
1,469,733
Other Receivables
98,288,290
379,726
373,113
Share Certificate Investments
139,830,305
Total
2,063,192,818 33,293,544 23,993,464 3,743,788 3,880,007 40,464,232
139,830,305
2,308,398,158
(*) 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.
231,954
337,707
942,716
73,175,870
590,106,579
303,266,421
90,503,487
6,082,919
175,792,914
3,811,338
99,041,129
139,830,305
Risk Groups (*)
Contingent and Non-Contin-
gent Receivables from Central
Governments or Central Banks
Contingent and Non-Contin-
gent Receivables from Regional
Government or Domestic
Government
Contingent and Non-Contin-
gent Receivables from Admin-
istrative Units and Non-Com-
mercial Enterprises
Contingent and Non-Contin-
gent Receivables from Multilat-
eral Development Banks
Contingent and Non-Contin-
gent Receivables from Interna-
tional Organizations
Contingent and Non-Contin-
gent Receivables from Banks
and Intermediaries
Contingent and Non-Contin-
gent Corporate Receivables
Contingent and Non-Contin-
gent Retail Receivables
Contingent and Non-Contin-
gent 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
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
90,985,138
164,594
34,256
437
18,387
804,285
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
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
(*) 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.
238
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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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
FC
Total
Sectors/Counterparty (*)
Agricultural
Farming and Raising
Livestock
Forestry
Fishing
Industry
Mining
Production
320
320
105,147
89,218
3,261
12,668
6,640,859
14,498,990
1,316,580
32,155
967,649
20,757,151
2,804,549
23,561,700
4,696,190
14,380,625
1,298,120
32,057
917,773
20,445,878
968,425
21,414,303
69,456
64,050
1,875,213
54,315
10,434
8,026
60
38
7,350
42,526
153,532
1,079
154,611
157,741
1,835,045
1,992,786
6,060,962
3,069
790
265,739,263
21,721,396
15,519,946
1,816,613
26,526,854
62,172,180
214,436,611
185,124,462
399,561,073
115,131
5,917,643
8,040,496
393,775
205,777
15,091
386,194
5,105,504
4,050,960
9,156,464
192,464,724
20,958,168
14,379,581
303,232
21,462,279
62,172,180
192,278,545
125,379,262
317,657,807
Electricity, gas, and water
28,188
3,069
790
65,234,043
369,453
934,588
1,498,290
4,678,381
17,052,562
55,694,240
72,746,802
Construction
1,863,603
12,924
49,302,274
10,060,931
8,727,219
1,696,384
6,093,548
43,656,540
34,100,343
77,756,883
Services
393,116,441
321,785
942,716
73,142,889
235,123,520
91,039,786
37,336,533
605,322
41,437,306
3,581,931
815,987
75,784,129
515,477,163
437,771,182
953,248,345
Wholesale and Retail Trade
2,802,435
Hotel, Food and Beverage
Services
Transportation and
Telecommunication
311,406
333,118
92,460,268
53,020,583
18,678,819
352,877
24,706,142
252,112
157,654,474
34,618,762
192,273,236
12,442,203
5,739,849
3,513,570
68,694
2,150,756
15,339,357
8,887,121
24,226,478
52,229,532
21,964,958
3,627,232
117,963
8,363,199
133,178
47,111,500
39,657,680
86,769,180
Financial Institutions
389,206,196
6
942,716
73,142,889
51,648,377
1,078,814
846,424
984
297,535
3,581,931
815,987
62,489,922
255,586,458
328,465,323
584,051,781
Real Estate and Renting
Services
54,218
Self-Employment Services
88,845
Education Services
119,393
Health and Social Services
200,830
201,138
117,260
2,284
1,097
10,088,055
3,510,023
8,365,664
15,422
2,771,040
12,908,917
25,295,878
12,618,599
37,914,477
1,367,541
2,395,225
575,724
35,397
859,289
5,033,456
405,825
5,439,281
1,899,995
747,505
781,956
1,967
573,422
2,210,121
1,916,401
4,126,522
12,987,549
2,582,829
947,144
12,018
1,715,923
7,245,919
11,201,471
18,447,390
Other
Total
424,128,666
228,885
1,888
32,981
33,300,663
165,945,318
27,603,209
1,932,445
100,767,557
229,407
98,225,142
1,873,996
742,083,041
112,187,116
854,270,157
825,274,819
231,954
337,707
942,716
73,175,870
590,106,579
303,266,421
90,503,487
6,082,919
175,792,914
3,811,338
99,041,129
139,830,305 1,536,410,506
771,987,652
2,308,398,158
(1) Contingent and non-contingent exposures to central governments or central banks
(10) Past due receivables
(2) Contingent and non-contingent exposures to regional governments or local authorities
(11) Receivables in regulatory high-risk categories
(3) Contingent and non-contingent exposures to administrative bodies and non-commercial undertakings
(12) Other receivables
(4) Contingent and non-contingent exposures to multilateral development banks
(13) Share Certificate Investments
(5) Contingent and non-contingent exposures to international organizations
(14) Stock Investments
(6) Contingent and non-contingent exposures to banks and brokerage houses
(*) Risk amounts after the credit conversions and the effects of credit risk mitigation
(7) Contingent and non-contingent corporate receivables
(8) Contingent and non-contingent retail receivables
(9) Contingent and non-contingent exposures secured by real estate property
240
(**) Credit Guarantee Fund guaranteed by the undersecretariat of treasury are
included in the receivables from central governments.
241
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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
14. Analysis of maturity-bearing exposures according to remaining maturities:
16. Miscellaneous Information According to Type of Counterparty or Major Sectors
Time to Maturity
Significant Sectors/Counterparty
Loans
Provisions
1 Month
1-3 Months
3-6 Months
6-12 Months
Over 1 Year
Total
Depreciated (TFRS 9)
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
71,005,765
13,406,480
14,377,580
17,949,511
322,898,441
439,637,777
2,901
5,310
8,901
19,875
194,967
231,954
2,426
104,206
189,241
1,819
36,086
333,778
745,472
129,260
67,984
942,716
Receivables from Banks and Intermediaries
40,749,126
6,488,612
6,294,452
7,491,092
11,424,064
72,447,346
Corporate Receivables
Retail Receivables
51,888,599
67,878,782
81,381,930
124,127,966
240,708,167
565,985,444
7,607,855
8,790,549
13,930,323
44,057,006
62,230,038
136,615,771
Collateralized Receivables with Real Estate Mortgages
4,080,163
4,593,094
4,138,158
17,765,565
51,327,611
81,904,591
Receivables are identified as High Risk by the Board
10,121,408
14,834,115
12,579,081
51,160,751
55,268,928
143,964,283
Total
186,203,715
116,230,408
132,899,666
262,573,585
744,156,286
1,442,063,660
(*) 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.
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 (**)
817,650,311
97,958,651
48,635,838 140,762,855 291,184,575 748,449,739 102,824,267
453,026
81,084,614
6,294,135
829,879,048
95,078,890
48,487,544 138,643,405 283,933,016 728,015,573 102,823,042
453,026
81,084,614
6,294,135
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.
242
Current Period
1
1.1
1.2
1.3
2
2.1
2.2
2.3
3
4
4.1
4.2
4.3
4.4
4.5
4.6
4.7
4.8
5
6
Agricultural
Farming and Raising Livestock
Forestry
Fishing
Industry
Mining
Production
Electricity, gas, and water
Construction
Services
Wholesale and Retail Trade
Hotel, Food and Beverage Services
Transportation and Telecommuni-
cation
Financial Institutions
Real Estate and Renting Services
Self-Employment Services
Education Services
Health and Social Services
Other
Total
Significant Increase in Credit
Risk (Stage 2)
Non-Performing (Stage 3)
1,013,817
933,579
5,475
74,763
34,207,991
8,936
9,342,239
24,856,816
4,514,677
28,439,370
4,505,743
6,405,315
5,093,274
14,263
10,366,997
1,924,356
76,738
52,684
32,828,126
101,003,981
80,953
79,132
92
1,729
8,682,268
96,786
1,624,382
6,961,100
6,297,550
3,565,619
1,329,303
328,357
1,028,598
3,001
750,058
77,968
12,911
35,423
6,293,358
24,919,748
Expected Credit Loss
(TFRS 9)
120,727
112,976
376
7,375
14,264,472
82,405
2,548,490
11,633,577
5,284,281
7,571,750
1,355,548
634,148
1,315,449
3,138
3,940,455
273,514
14,125
35,373
6,167,070
33,408,300
17. Information on Value Adjustments and Change in Credit Provisions:
Beginning Balance
Additional Provisions
Reversal of Provisions Other Value Adjustment
Ending Balance
1
2
Stage 3 provisions
Stage 1 and Stage 2
Provisions
17,207,112
7,982,323
(6,357,505)
15,381,907
9,590,866
(6,031,203)
18,831,930
18,941,570
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
Cayman Island
Albania
Kosovo
Malta
Marshall Adaları
Iraq
Bahrain
Other
917,943,477
9,384,655
2,871,907
2,565,591
2,212,669
2,142,940
1,892,968
1,687,073
1,309,899
497,110
3,831,451
75,158
918,018,635
9,384,655
2,871,907
2,565,591
2,212,669
2,142,940
1,892,968
1,687,073
1,309,899
497,110
3,831,451
243
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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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
31.12.2023
29.12.2023
28.12.2023
27.12.2023
26.12.2023
25.12.2023
USD
EUR
29.4350
29.4350
29.3051
29.2230
29.1474
29.0100
32.5698
32.5698
32.4495
32.4696
32.1700
31.9545
The Bank’s last 30-days arithmetical average foreign currency purchase rates:
USD: 28.9493 TL
EURO: 31.6085 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, IQD, 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
(481,723)
481,723
201,857
(201,857)
148,438
(148,438)
(111,699)
111,699
188,682
(188,682)
74,654
(74,654)
82,821
(82,821)
(99,261)
99,261
USD
IQD
GEL
GBP
(*) Indicates the values before tax
Information on currency risk:
Current Period
Assets
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
EUR
USD
Other FC
Total
132,395,128
177,478,183
47,812,761
357,686,072
4,912,030
1,718,759
13,333,352
7,182,755
23,457,057
17,083,064
41,702,439
25,984,578
Financial Assets at Fair Value Through Other Comprehensive Income
4,151,095
84,879,586
17,771
89,048,452
Loans (3)
192,543,414
203,712,932
16,199,051
412,455,397
Investments in Associates, Subsidiaries and Jointly Controlled Entities (Joint
Ventures)
13,991,707
3,681,108
17,672,815
Financial Assets Measured at Amortised Cost
4,326,858
6,651,572
8,663,028
19,641,458
Derivative Financial Assets Held for Risk Management
Tangible Assets (4)
Intangible Assets
Other Assets (2)
Total Assets
Liabilities
Banks Deposits
Foreign Currency Deposits (45)
Money Market Funds
Funds Provided from Other Financial Institutions
Marketable Securities Issued (6)
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 (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
42,504
5,638
6,629
5,869
(3,503,340)
3,127,031
36,842
1,628
350,416
85,975
13,135
(25,893)
350,583,793
496,377,909
117,302,726
964,264,428
4,206,932
13,018,222
1,308,738
18,533,892
250,285,833
333,341,087
179,435,656
763,062,576
1,624,355
36,976,782
2,161,546
5,486,753
47,596,380
80,466,340
85,599,178
8,160,137
49,220,735
1,268
117,444,390
16,974,281
104,735,005
466,193
14,113,083
5,694,484
8,485,281
1,168,934
15,348,699
306,436,685
576,666,625
199,355,070
1,082,458,380
44,147,108
(80,288,716)
(82,052,344)
(118,193,952)
(45,198,726)
57,943,794
103,142,520
119,070,848
75,249,597
180,085,881
104,836,284
130,433,459
87,158,061
104,463,195
17,305,134
11,504,862
117,208,932
342,492,870
225,283,938
261,009,169
215,688,747
303,838,222
62,284,751
581,811,720
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
53,427,916
68,430,893
157,036,003
48,930,238
244,938,769
53,961,375
79,258,121
4,365,928
8,944,195
111,755,219
156,633,209
(1) Precious metals accounts amounting TL 42,576,277 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”, TL 11,828,125 of Derivative Financial Assets Accrual, Prepaid Expenses (461,433 TL) in assets, and 2,692,490 TL of Derivative Financial Liabilities Accrual in liabilities, Equity
(1,538,281) are not taken into account in the currency risk calculation. Other Assets and Other Liabilities include Expected Loss Provisions; the expected loss provision balance of foreign currency indexed
loans is TL 2,017.
(3)Foreign currency indexed loans amounting TL 460,092 presented in TL loans in the balance sheet are included in the table above. TL 365,442 is USD indexed, TL 90,516 is EUR indexed., TL 4,134 is
GBP indexed.
(4 Includes Assets Held for Sale and Discontinued Operations (Net).
(5) Precious metals deposit accounts amounting TL 116,452,555are included.
(6) Includes Tier 2 subordinated bonds which are classified on the balance sheet as subordinated loans.
(7) 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.
244
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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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
100 bps increase
100 bps increase
100 bps decrease
100 bps decrease
1,129,236
(1,139,827)
995,614
(1,307,172)
(5,716,077)
6,186,095
(2,975,711)
3,223,619
(*) 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.
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
47,430,849
476,072,021
523,502,870
Banks
8,412,847
4,192,964
30,653,525
43,259,336
Financial Assets at Fair Value
through Profit/Loss (*)
Money Market Placements
Financial Assets at Fair
Value Through Other
Comprehensive Income
7,381,989
14,850,968
8,897,070
6,748,575
30,647
4,335,683
42,244,932
61,294,237
19,469,431
38,069,394
67,309,247
64,970,643
2,006,492
253,119,444
Loans
389,632,275
105,573,902
394,359,915
212,513,612
70,211,220
Financial Assets Measured at
Amortised Cost
24,117,182
43,724,477
45,230,559
50,437,045
32,513,698
1,172,290,924
196,022,961
Other Assets (**)
483,319
222,859,513
223,342,832
Total Assets
538,752,698
183,618,778
490,749,902
337,008,479
167,726,208
735,927,234
2,453,783,299
Liabilities
Banks Deposits
Other Deposits
82,920,995
3,932,165
2,599,841
612,635,675
224,782,401
84,655,956
4,194,566
5,084,016
1,963,095
95,610,662
762,066
638,647,918
1,566,568,032
Money Market Funds
103,858,959
13,357,915
5,963,818
Miscellaneous Payables
8,941,530
Marketable Securities Issued
(***)
Funds Provided from Other
Financial Institutions
389,925
4,611,289
58,957,218
18,932,935
25,465,659
30,414,815
71,611,695
16,681,047
1,521,760
536,793
123,180,692
85,577,286
94,518,816
108,357,026
120,766,110
Other Liabilities (****)
2,575,828
1,316,037
3,484,784
1,147,956
2,215,573
334,041,783
344,781,961
Total Liabilities
841,737,727
319,611,502
172,342,664
30,881,233
28,980,091
1,060,230,082
2,453,783,299
Balance Sheet Long Position
318,407,238
306,127,246
138,746,117
763,280,601
Balance Sheet Short Position
(302,985,029)
(135,992,724)
(324,302,848)
(763,280,601)
Off Balance Sheet Long
Position
Off Balance Sheet Short
Position
10,821,285
30,388,725
12,343,414
53,553,424
(35,090,412)
(12,881,875)
(47,972,287)
Total Position
(292,163,744)
(105,603,999)
283,316,826
318,470,660
125,864,242 (324,302,848)
5,581,137
(*) 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.
246
247
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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, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Prior Period
Assets
Cash (Cash in Vault, Foreign
Currency Cash, Money in
Transit, Cheques Purchased)
and Balances with the
Central Bank of Turkey
Up to
1 Month
7,453,621
1-3 Months
3-12 Months
1-5 Years
5 Years
and Over
Non-interest
Bearing
Total
a.
Average interest rates applied to monetary financial instruments:
191,476,032
198,929,653
Current Period
Assets
Cash (Cash in Vault. Foreign Currency Cash. Money in Transit. Cheques
Purchased) and Balances with the Central Bank of Turkey
Banks
9,966,090
575,776
12,492,763
23,034,629
Banks
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
Financial Assets Measured
at Amortised Cost
11,568,362
22,518,424
25,385,370
22,459,724
11,442,117
782,423,321
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
1,493,230
9,825,209
365,803,736
97,869,384
34,542,133
1,172,896
421,863,931
921,252,080
Money Market Funds
33,370,104
5,080,678
1,648,534
Miscellaneous Payables
5,136,114
40,099,316
46,920,353
52,056,467
Marketable Securities Issued
(***)
Funds Provided from Other
Financial Institutions
1,999,278
2,492,560
8,441,214
24,217,675
24,722,121
14,583,517
49,496,547
5,313,106
1,669,504
392,652
61,872,848
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
259,000,071
234,649,714
66,092,688
559,742,473
Balance Sheet Short Position
(145,420,745)
(21,544,192)
(392,777,536)
(559,742,473)
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
(*) Includes Tier 2 subordinated bond which is classified on the balance sheet as subordinated loan.
Current Period
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
7,421,791
22,871,812
30,293,603
Financial Assets Measured at Amortised Cost
Off Balance Sheet Long
Position
Off Balance Sheet Short
Position
(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.
248
Liabilities
Banks Deposits
Other Deposits
Money Market Funds
Miscellaneous Payables
Debt Securities Issued (*)
Funds Provided from Other Financial Institutions
(*) Includes Tier 2 subordinated bond which is classified on the balance sheet as subordinated loan.
EUR
%
USD
%
JPY
%
TL
%
4.75
2.19
2.64
3.41
8.07
2.74
3.65
0.15
6.41
6.74
7.07
4.75
3.01
5.81
6.46
9.55
6.02
7.92
0.38
7.19
7.33
8.25
7.10
6.60
EUR
%
USD
%
JPY
%
TL
%
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
6.77
31.47
35.74
36.58
38.52
29.03
43.88
30.83
43.20
32.07
16.39
13.30
13.53
32.82
20.56
23.30
12.64
11.63
9.03
14.37
10.85
249
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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, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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 (*)
102,243,325
141,832,935
40,271,948
62,172,180
453,026
22,038
27,193,671
14,340,273
(*) 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
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
1
2
3
4
Private Equity Investments
Shares Traded on a Stock
Exchange
Other Stocks
Total
97,095,436
97,095,436
26,103,933
123,199,369
26,103,933
123,199,369
(*) Represents the amounts reflected to equity according to the equity method.
ç. 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
102,444,128
42,009,008
144,453,136
102,444,128
36,315,729
138,759,857
8,195,530
2,905,258
11,100,788
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 depo
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.
sits is shorter than that assets as a result of the market conditions, the
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.
The lowest value
Applicable week
The highest value
Applicable week
Current Period
Prior Period
TL+FC
FC
TL+FC
FC
168.12
17.11.2023
200.71
20.10.2023
193.66
27.10.2023
488.83
15.12.2023
147.33
25.11.2022
163.68
07.10.2022
429.54
21.10.2022
498.62
07.10.2022
250
251
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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, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Liquidity Coverage Ratio:
Current Period
HIGH QUALITY LIQUID ASSETS
High Quality Liquid Assets
Cash Outflows
Total Unweighted Value (*)
Total Weighted Value (*)
TL+FC
FC
TL+FC
FC
Prior Period
HIGH QUALITY LIQUID ASSETS
High Quality Liquid Assets
CASH OUTFLOWS
602,366,091
285,886,507
Retail and Small Business Customers, of which;
607,788,670
375,439,523
Retail and Small Business Customers, of which;
1,040,925,241
552,455,049
95,180,605
55,245,505
Stable deposits
Less stable deposits
178,238,369
8,911,918
862,686,872
552,455,049
86,268,687
55,245,505
Unsecured wholesale funding, of which;
472,401,277
214,745,129
244,205,783
115,557,655
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
Commitments related to debts to financial markets and other off-balance
sheet obligations
Other revocable off-balance sheet commitments and contractual
obligations
4,338,576
46,303
1,073,698
372,577,353
181,060,598
179,298,799
95,485,348
33,638,228
63,833,286
7,969,962
17,388,184
5,554,161
7,969,962
11,576
82,575,282
32,970,797
5,559,573
17,388,184
2,459,721
11,877,943
2,459,721
11,877,943
5,510,241
5,510,241
5,510,241
5,510,241
12,364,468
8,955,998
618,223
447,800
Other irrevocable or conditionally revocable off-balance sheet obligations
900,365,123
269,311,970
83,707,978
32,489,379
TOTAL CASH OUTFLOWS
CASH INFLOWS
Secured lending
Unsecured lending
Other cash inflows
TOTAL CASH INFLOWS
Upper Limit Applied Value
TOTAL HQLA STOCK
TOTAL NET CASH OUTFLOWS
LIQUIDITY COVERAGE RATIO (%)
437,236,712
226,688,096
155,785,724
64,311,490
103,780,295
6,749,477
78,819,686
6,749,477
52,209,589
78,819,686
162,535,201
143,131,176
110,529,772
131,029,275
602,366,091
285,886,507
326,706,940
96,862,997
184.93
326.97
(*) The simple arithmetic average calculated for the last three months of the weekly simple arithmetic average.
Total Unweighted Value (*)
Total Weighted Value (*)
TL+FC
FC
TL+FC
FC
290,541,464
191,864,620
55,791,039
4,987,827
50,803,212
140,876,717
695,174
99,045,133
41,136,410
13,894
7,872,717
37,543,952
37,543,952
85,859,370
6,538
63,163,521
22,689,311
13,894
17,959,684
Stable deposits
Less stable deposits
Unsecured funding, of which;
Operational deposits
Non-operational deposits
Other unsecured funding
Secured funding
Other cash outflows, of which;
99,756,547
508,032,123
281,487,104
2,828,624
219,889,000
58,769,480
375,439,523
163,930,241
26,151
140,815,477
23,088,613
7,872,717
17,959,684
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
2,891,210
12,978,177
2,891,210
12,978,177
4,981,507
4,981,507
4,981,507
4,981,507
Other revocable off-balance sheet commitments and contractual obligations
Other irrevocable or conditionally revocable off-balance sheet obligations
15,512,942
417,893,359
13,118,885
173,291,972
775,647
42,376,139
655,944
20,623,035
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 (%)
247,706,153
162,655,879
63,928
82,246,729
2,503,906
46,338,450
107,633,007
58,478,094
2,503,906
39,232,322
107,633,007
84,814,563
153,971,457
60,982,000
146,865,329
Upper Limit Applied Value
290,541,464
191,864,620
186,724,153
40,663,970
155.47
473.02
(*) 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 2023, the total liquidity coverage ratio increased due to the increase in the total high-quality asset stock, and foreign
currency liquidity coverage ratio decreased due to the increase in net cash outflows. 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.
252
253
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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 (*)
Total
Assets
Cash (Cash in Vault, Foreign
Currency Cash, Money in
Transit, Cheques Purchased)
and Balances with the Central
Bank of Turkey
325,002,285
198,500,585
Banks
35,899,259
3,167,113
4,192,964
4,334,285
7,136,718
14,847,350
8,562,893
7,223,967
139,719
523,502,870
43,259,336
42,244,932
2,006,492
6,202,734
4,784,678
15,501,370
146,057,132
78,567,038
253,119,444
Loans (***)
41,895,006
259,382,037
156,154,765
393,572,172
237,301,341
59,065,855
24,919,748
1,172,290,924
9,558,766
10,484,469
19,742,562
101,589,719
54,647,445
196,022,961
15,722,104
366,537
7,531,286
199,722,905
223,342,832
409,137,327 499,670,057
186,637,799
441,571,961 499,703,445
192,420,057 224,642,653
2,453,783,299
1,963,095
82,920,995
3,932,165
2,597,371
4,197,036
638,647,918
612,635,364
224,781,727
84,653,797
5,087,160
762,066
9,711,507
4,631,477
71,913,141
33,949,521
560,464
100,975,109
6,718,844
12,678,624
2,808,115
389,928
3,267,621
58,957,213
19,437,874
26,304,390
91,896,108
805,847
2,356
1,814,505
95,610,662
1,566,568,032
120,766,110
123,180,692
108,357,026
94,518,816
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
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 (*)
640,611,013 700,844,099 239,733,389
95,632,159
10,329,775
834,772 1,687,985,207
25,806,513 1,662,178,694
9,849,917
5,856,229
77,081,977
38,941,898
594,124
132,324,145
11,558,035
120,766,110
101,133,524
6,958,963
13,524,018
2,964,478
124,580,983
1,400,291
123,180,692
1,334,988
4,360,554
64,116,512
34,570,785
27,605,588
131,988,427
23,631,401
108,357,026
Leasing Liabilities
96,624
184,700
804,434
2,589,057
3,567,263
7,242,078
3,975,035
3,267,043
(*) Includes Tier 2 subordinated bond which is classified on the balance sheet as subordinated loan.
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 (*)
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
Leasing Liabilities
63,333
144,014
522,280
1,694,169
2,267,874
4,691,670
2,539,463
2,152,207
Liquidity Gap
(231,473,686)
(419,057,612)
(65,562,008)
206,655,721 430,762,205 164,090,486 (85,415,106)
The following table shows the remaining maturities of non-cash loans of the Bank.
20,198,658
8,062,126
4,113,738
1,647,029
702,651
310,057,759
344,781,961
640,611,013
918,727,669
252,199,807
234,916,240
68,941,240
28,329,571
310,057,759
2,453,783,299
(*)Includes Tier 2 subordinated bond which is classified on the balance sheet as subordinated loan.
Net Off Balance Sheet Position
(6,396,781)
(2,808,777)
4,469,462
1,873,108
1,099,750
Derivative Financial Assets
143,832,676
136,573,619
117,900,322
135,327,434
94,916,321
Derivative Financial Liabilities
150,229,457
139,382,396
113,430,860
133,454,326
93,816,571
Non-cash Loans
212,298,335
13,720,385
34,794,990
122,900,302
35,814,437
7,842,355
(1,763,238)
628,550,372
630,313,610
427,370,804
Prior Period
Total Assets
Total Liabilities
Liquidity Gap
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
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
(290,084,412) (217,654,805)
(1,685,855) 203,905,569
300,421,270 105,688,460 (100,590,227)
Net Off Balance Sheet Position
1,675,458
(1,424,161)
1,531,226
2,316,880
560,500
Derivative Financial Assets
Derivative Financial Liabilities
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
Non-cash Loans
130,994,153
7,489,287
19,034,472
64,412,078
19,239,252
5,527,272
4,659,903
407,841,691
403,181,788
246,696,514
(*) 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
Current Period
Demand
Up to 1 Month
1-3 Months
3-12 Months
1-5 Years
5 Years and Over
Letters of Credit
31,144,756
Letters of Guarantee
179,550,225
6,839,107
5,759,674
1,121,604
16,604,532
16,336,276
1,840,682
13,500
30,359,167
79,932,221
12,537,264
71,650
112,735
1,490,619
212,298,335
13,720,385
34,794,990
122,900,302
35,814,437
7,842,355
427,370,804
Current Period
Demand
Up to 1 Month
1-3 Months
3-12 Months
1-5 Years
5 Years and Over
Letters of Credit
21,031,210
Letters of Guarantee
108,829,989
4,695,440
2,377,323
416,524
8,170,572
9,901,311
923,075
39,514
19,349,001
37,543,763
7,433,282
86,032
137,720
995,234
130,994,153
7,489,287
19,034,472
64,412,078
19,239,252
5,527,272
246,696,514
Total
85,384,944
437,382
34,181,540
4,194,193
319,954,129
187,849
1,007,666
15,800,134
3,648,162
6,231,597
Total
53,246,223
17,674,969
2,955,329
179,282,684
420,875
1,143,408
2,571,943
9,331,476
4,836,131
Acceptances
Other
Total
Acceptances
Other
Total
254
255
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
The following table shows the remaining maturities of derivative financial assets and liabilities of the Bank.
On-Balance sheet items
Current Period (*)
Prior Period (*)
Up to 1 Month
1-3 Months
3-12 Months
1-5 Years
5 Years and Over
Total
On-balance sheet items (excluding derivatives and SFTs, but including collateral)
Current Period
Forwards Contracts-Buy
Forwards Contracts-Sell
Swaps Contracts-Buy
Swaps Contracts-Sell
Futures Transactions-Buy
Futures Transactions-Sell
Options-Call
Options-Put
Other
Total
Current Period
Forwards Contracts-Buy
Forwards Contracts-Sell
Swaps Contracts-Buy
Swaps Contracts-Sell
Futures Transactions-Buy
Futures Transactions-Sell
Options-Call
Options-Put
Other
Total
12,748,125
12,748,125
34,070,528
34,070,528
40,516,173
40,516,173
7,139,832
7,139,832
12,684,910
12,684,910
33,679,913
33,679,913
39,764,747
39,764,747
7,180,993
7,180,993
94,474,658
94,474,658
93,310,563
93,310,563
97,591,753
97,591,753
65,211,031
65,211,031
47,667,584
47,667,584
127,515,522
127,515,522
89,157,312
89,157,312
427,143,202
427,143,202
116,444,401
116,444,401
89,247,254
89,247,254
45,120,335
45,120,335
125,601,252
125,601,252
88,057,564
88,057,564
464,470,806
464,470,806
1,011,001
1,011,001
983,035
983,035
9,881,648
9,881,648
15,250,550
15,250,550
26,011,557
26,011,557
9,963,899
9,963,899
14,811,293
14,811,293
25,723,820
25,723,820
5,759,008
5,759,008
5,759,008
5,759,008
32,753,361
32,753,361
23,685,446
23,685,446
6,526,966
6,526,966
1,344,161
1,344,161
1,011,001
1,011,001
983,035
983,035
56,902,763
56,902,763
56,258,020
56,258,020
64,309,934
64,309,934
294,062,133
294,062,133
275,956,015
275,956,015
231,331,182
231,331,182
268,781,760
268,781,760
188,732,892
188,732,892
1,258,863,982
1,258,863,982
Up to 1 Month
1-3 Months
3-12 Months
1-5 Years
5 Years and Over
Total
5,717,551
5,717,551
10,756,575
10,756,575
12,515,612
12,515,612
5,697,764
5,697,764
10,520,109
10,520,109
12,294,262
12,294,262
2,376,097
2,376,097
2,406,304
2,406,304
31,365,835
31,365,835
30,918,439
30,918,439
130,035,589
130,035,589
42,160,572
42,160,572
13,656,029
13,656,029
66,850,977
66,850,977
67,211,082
67,211,082
319,914,249
319,914,249
147,228,461
147,228,461
53,156,757
53,156,757
13,015,952
13,015,952
64,503,890
64,503,890
66,650,582
66,650,582
344,555,642
344,555,642
25,945
25,945
25,402
25,402
671,422
671,422
811,948
811,948
55,041
55,041
50,766
50,766
3,538,061
3,538,061
1,557,467
1,557,467
5,545,458
5,545,458
3,553,528
3,553,528
1,551,533
1,551,533
4,879,934
4,879,934
24,078,829
24,078,829
15,059,520
15,059,520
13,676,934
13,676,934
707,612
707,612
707,612
707,612
127,978
127,978
3,822,162
3,822,162
3,822,162
3,822,162
752,408
752,408
888,116
888,116
15,170,760
15,170,760
14,514,769
14,514,769
52,943,261
52,943,261
319,901,130
319,901,130
136,245,903
136,245,903
75,689,988
75,689,988
137,680,470
137,680,470
141,505,988
141,505,988
811,023,479
811,023,479
VII.
Explanations on Leverage Ratio
a.
Explanations on Differences Between Current and Prior Years’ Leverage Ratios
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 7.11% (December 31, 2022: 9.19). 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
b.
Explanations on leverage ratio:
Assets amounts deducted from Tier 1 capital
Total on balance sheet exposures
Derivative exposures and credit derivatives
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
2,273,957,818
(5,577,290)
2,268,380,528
23,913,293
12,902,180
36,815,473
1,352,238,923
(3,039,822)
1,349,199,101
16,095,379
5,788,378
21,883,757
25,354,336
12,032,913
Total risks related with securities or commodity financing transactions
25,354,336
12,032,913
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
969,163,029
(11,392,142)
957,770,887
233,919,111
3,288,321,224
452,575,932
(10,541,558)
442,034,374
167,776,503
1,825,150,145
7.11
9.19
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 1,703 increase/decrease.
IX.
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
Investments Financial Assets Measured Amortized Cost
Loans
Financial Liabilities
Banks Deposits
Other Deposits
Funds Provided from Other Financial
Marketable Securities Issued (*)
Miscellaneous Payables
Book Value
Fair value
Current Period
Prior Period
Current Period
Prior Period
43,259,336
253,119,444
196,022,961
1,147,371,176
23,034,629
170,596,394
93,373,997
43,243,191
253,119,444
182,971,887
23,033,858
170,596,394
112,124,518
759,289,191
1,098,134,873
753,631,585
95,610,662
9,825,209
95,176,615
9,756,498
1,566,568,032
921,252,080
1,564,417,366
921,349,972
120,766,110
108,357,026
94,518,816
71,455,326
61,872,848
52,056,467
120,755,875
107,096,961
94,518,816
70,881,361
59,860,194
52,056,467
(*) Includes subordinated bonds which are classified on the balance sheet as subordinated loans.
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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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.
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.
2.
Information on fair value measurements recognized in the financial statements
a. General Information on Risk Management Approach and Risk Weighted Amounts
“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
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
Level 1
Level 2
Level 3
15,329,573
17,029
3,611,275
658,024
18,969,802
3,659,229
140,807,997
110,054,737
250,218
1,877,914
7,213,378
(*) Since they are not traded in an active market, the equity securities TL 128,578 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
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
Level 1
Level 2
Level 3
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 117,950 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.
The movement table of financial assets at level 3 is given below:
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
350,829
2,136,935
(100,610)
(1,886,716)
250,219
100,610
350,829
Real estates which are presented in the financial statements at fair value are classified at level 3.
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.
a.1. 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 main risk types,
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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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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, 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.
a.2.
Overview of risk weighted amounts:
Credit risk (excluding counterparty credit risk) (CCR)
Of which standardized approach (SA)
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
Risk Weighted Amounts
Minimum Capital Requirements
Current Period
Prior Period
Current Period
1,332,328,145
1,332,328,145
853,562,058
853,562,058
15,422,959
15,422,959
14,270,649
14,270,649
106,586,252
106,586,252
1,233,837
1,233,837
Equity investments in funds – look-through approach
3,811,338
2,646,881
304,907
Equity investments in funds – mandate-based approach
Equity investments in funds – 1250% weighted risk approach
Settlement risk
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
488,675
21,438
39,094
27,383,288
27,383,288
96,539,046
96,539,046
18,420,488
18,420,488
50,403,474
50,403,474
2,190,663
2,190,663
7,723,124
7,723,124
The amounts below the thresholds for deduction from capital (subject to a
250% risk weight)
1,132,565
963,063
90,605
Floor adjustment
Total
1,477,106,016
940,288,051
118,168,482
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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
b.
Linkages between Financial Statements and Risk Amounts
b.1. 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
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
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
523,502,870
523,502,870
43,259,336
43,259,336
23,275,130
21,323,019
253,119,444
253,119,444
Derivative Financial Assets at Fair Value Through Profit/Loss
18,969,802
18,969,802
18,969,802
Derivative Financial Assets at Fair Value Through Other
Comprehensive Income
Financial Assets at Amortised Cost-Credit
1,172,290,924
1,172,287,694
Financial Assets at Amortised Cost-Other Financial Assets
196,022,961
196,022,961
Financial Assets at Amortised Cost-Expected Loss Provisions (-)
37,967,503
37,967,503
Assets Held for Sale and Discontinued Operations
1,540,594
1,540,594
Investment in Associates, Subsidiaries and Joint-Ventures
144,453,136
144,453,136
1,952,111
1,077,774
6,352,210
34,230,786
34,075,431
6,398,654
252,198
12,090,016
12,090,016
62,597,149
62,597,149
155,355
6,146,456
2,453,783,299 2,445,526,147
18,969,802
9,382,095
6,305,041
Derivative Financial Liabilities at Fair Value Through Profit/Loss
7,213,378
7,213,378
1,662,178,694
120,766,110
123,180,692
68,486,044
18,487,850
123,180,692
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
1,662,178,694
102,278,260
68,486,044
3,267,043
39,920,879
9,607,897
111,494,096
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
262
3,267,043
39,920,879
9,607,897
39,870,982
111,494,096
267,797,484
2,453,783,299
141,668,542
7,213,378
1,997,232,913
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
2,767,590
4,677,273
9,381,439
3,230
Financial Assets at Amortised Cost-Credit
782,423,321
782,420,671
2,650
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
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 1,405,454,719 17,029,298
16,826,302
3,302,275
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
7,239,013
40,099,316
8,840,818
931,077,289
64,216,313
28,314,103
2,152,207
30,539,092
6,562,930
1,080,530
63,266,237
1,408,322,668
47,338,329
8,840,818
1,127,208,701
263
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Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
b.2. 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:
1
2
3
4
5
6
7
8
9
10
11
1
2
3
4
5
6
7
8
9
10
11
Current Period
Total
Credit Risk
Securitization
Positions
Counterparty credit
risk
Market risk
Asset carrying value amount under scope of TAS
2,453,783,299
2,445,526,147
18,969,802
9,382,095
Liabilities carrying value amount under scope of TAS
Total net amount scope of financial statement
2,453,783,299
2,445,526,147
1,689,519,470
277,153,012
(141,668,542)
160,638,344
30,952,383
30,168,644
7,213,378
2,168,717
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
(*) 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.
(412,277,926)
(39,139,122)
2,271,262,111
61,121,027
2,168,717
Current Period
Loans
Debt Securities
Off-balance sheet exposures
Total
Current 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
24,919,748
5,940,979
30,860,727
1,147,371,176
466,723,133
1,029,980,923
2,644,075,232
18,831,930
2,891,615
21,723,545
1,153,458,994
466,723,133
1,033,030,287
2,653,212,414
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
25,125,045
759,289,191
269,306,646
453,484,304
1,482,080,141
17,207,112
1,616,688
18,823,800
765,216,209
269,306,646
453,858,531
1,488,381,386
Prior Period
Total
Credit Risk
Securitization
Positions
Counterparty
credit risk
Market risk
c.1.3. Changes in stock of default loans and debt securities (*):
Asset carrying value amount under scope of TAS
1,408,322,668
1,405,457,369
17,029,298
16,826,302
Liabilities carrying value amount under scope of TAS
Total net amount scope of financial statement
1,408,322,668
1,405,457,369
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
885,372,448
158,493,495
(166,370,491)
(32,532,563)
1,365,047,811
8,840,818
7,985,484
(47,338,329)
64,367,627
23,771,654
11,360,476
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
23,134,130
15,762,878
(1,818,237)
(2,884,257)
(9,274,766)
24,919,748
20,830,559
14,970,763
(497,130)
(4,977,165)
(7,192,897)
23,134,130
35,132,130
7,985,484
c.1.4. Additional Explanation About the Credit Quality of Assets
Bank’s methods for determining provision amounts and classification of its loans are mentioned in the Section Three Note VIII.
(*) 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.
(**) 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.
264
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 2023 is TL 2,884,257
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
24,455,556
159,546
63,128
23,645
217,873
24,919,748
18,444,044
126,290
57,157
14,543
189,896
18,831,930
22,683,339
230,924
37,019
10,098
172,750
23,134,130
(*) 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
16,846,075
154,985
31,646
8,182
166,224
17,207,112
265
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Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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
1,116,564,690
22,244,731
20,128,529
14,649,573
12,207,672
466,723,133
Exposures before CCF
and CRM
Exposures post-CCF
and CRM
RWA and RWA density
Current Period
On-balance
sheet
amount
Off-balance
sheet
amount
On-balance
sheet
Amount
Off-balance
sheet
amount
Risk- weighted
amount
Exposures to sovereigns and their central banks
807,904,814
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
231,810
352,112
942,716
5,317
753
820,115,888
5,158,931
15,607,817
231,684
270
115,990
524,821
309,884
27,823
337,707
100.00%
942,716
31,978,277
36,726,306
31,978,275
41,197,595
25,849,560
429,626,431
393,171,606
408,406,217
181,700,362
506,248,853
298,599,587
459,805,447
291,798,652
11,467,769
232,283,167
Exposures secured by residential property
46,534,898
4,304,544
46,407,893
2,079,651
16,970,640
Exposures secured by commercial property
37,209,303
7,882,675
37,209,303
4,806,640
24,994,436
Past-due loans
6,082,919
6,082,919
3,443,577
Risk-
weighted
amount
density
1.89%
50.01%
0.00%
35.33%
85.79%
76.59%
35.00%
59.49%
56.61%
1,583,287,823
22,244,731
20,128,529
14,649,573
12,207,672
Exposures in higher-risk categories by the Board
174,802,032
3,875,895
174,802,032
990,882
300,445,229
170.91%
Of which defaulted
24,919,747
Prior 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
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
3,811,338
3,811,338
3,811,338
100.00%
98,262,277
18,573,132
98,262,277
778,852
77,812,969
78.57%
139,830,305
139,830,305
140,509,844
100.49%
2,076,168,819
924,870,496 2,060,189,383
248,208,775
1,348,431,127
58.41%
735,059,052
13,488,908
11,567,926
16,668,245
15,057,209
(*)The loan conversion rate and the amount of off-balance sheet receivables after credit risk reduction include the amount of counterparty credit risk.
Loans
Debt securities
Total
Loans (*)
Debt securities
Total
269,306,646
1,004,365,698
13,488,908
11,567,926
16,668,245
15,057,209
Of which defaulted
23,134,130
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
266
Exposures before CCF
and CRM
Exposures post-CCF
and CRM
RWA and RWA density
Current Period
On-balance
sheet
amount
Off-balance
sheet
amount
On-balance
sheet
Amount
Off-balance
sheet
amount
Risk- weighted
amount
Exposures to sovereigns and their central banks
Exposures to regional and local governments
395,124,248
192,016
372
1,579
408,343,017
3,672,028
7,992,586
191,900
267
96,096
Risk-
weighted
amount
density
1.94%
50.01%
Exposures to administrative bodies and non-commercial
entities
83,157
188,278
81,195
81,443
162,638
100.00%
Exposures to multilateral development banks
738,079
738,079
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
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%
0.00%
36.42%
85.87%
77.75%
35.00%
60.66%
73.33%
2,611,881
35,000
2,611,881
35,000
2,646,881
100.00%
60,591,899
4,331,668
60,591,899
1,174,766
48,815,130
78,246,112
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%
267
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Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
c3.3. Standardised Approach-Exposures by Risk Classes and Risk Weights:
0%
10% 20%
25%
35%
50%
Risk Weights
Bank
75%
100%
150%
250%
Other
Total
Current Period
0%
10%
20%
25%
35%
50%
Risk Weights
Bank
75%
100%
150%
250%
Other
Total
809,667,000
5
15,607,814
825,274,819
231,929
25
337,707
231,954
337,707
942,716
942,716
36,170,925
31,939,672
2,214,454
252,749
2,598,070
73,175,870
56,459,430
67,007,463
461,234,496
74,755
5,330,435
590,106,579
283,933,016 19,333,405
48,487,544
34,043,015
7,972,928
5,281,253
799,097
2,569
303,266,421
48,487,544
42,015,943
6,082,919
140,068
3,768 102,492,969
73,156,109
175,792,914
3,811,338
3,811,338
19,269,332
829,879,048
2,448,535
95,078,890
48,487,544
138,643,405
283,933,016
728,015,573
102,823,042
453,026 81,084,614
2,308,398,158
139,377,279
77,323,262
453,026
139,830,305
99,041,129
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
Other exposures
Total
268
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
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
46,382,576
20,524,535
872,908
112,527
31,090
42,605,601
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
Other exposures
12,865,658
Total
417,626,191
107,346
67,554,463
2,646,881
77,860,887
48,793,661
385,225
2,646,881
78,246,112
61,766,665
34,914,774
90,685,838
166,261,050
515,936,220
59,977,981
385,225
36,962,227
1,390,303,969
269
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Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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)
7,181,593
5,562,324
1,4
12,743,917
4,801,284
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
Current Period
Prior Period
Risk Amounts
(Post CRM)
Risk Weighted
Amounts
Risk Amount
(Post CRM)
Risk Weighted
Amounts
12,743,917
4,262,971
11,997,280
Total subject to the CVA capital change
12,743,917
4,262,971
11,997,280
d.4. CCR exposures by risk class and risk weights:
Current Period
0%
10%
20%
50%
75%
100%
150%
Other
Risk Weights
Risk Groups
Exposures to sovereigns and their central
banks
5,141,141
4,117,938
4,117,938
Total Credit
Exposure (*)
5,141,141
16,463,625
6,199,225
11,000,509
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
24
24
9,743,014
9,101,730
688,575
328,549
674,759
3,507,820
21,930
19,519,503
4,524,944
21,930
7,928,505
7,928,505
5,141,141
10,431,589 9,430,279
21,930
4,182,603
7,928,505 37,136,047
(*) Other receivables: d.7. includes amounts reported in the table of risks to the central counterparty.
Prior 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
270
8,501,779
2,800,936
10,056,350
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
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
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.
271
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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
d.5. Collateral for CCR:
Collateral used in
derivative transactions
Collateral used in
other transactions
Current Period
Received
Collateral
Given
Collateral
Segregated Unsegregated Segregated Unsegregated
Received
Collateral
Given
Collateral
Cash- Domestic Currency
Cash- Other Currencies
Total
72,060,279
41,078,817
113,139,096
Collateral used in
derivative transactions
Collateral used in
other transactions
Current Period
Received
Collateral
Given
Collateral
Segregated Unsegregated Segregated Unsegregated
Received
Collateral
Given
Collateral
27,662,201
11,981,322
39,643,523
Current Period
Prior Period
Post CRM risk
exposure
RWA
Post CRM risk
exposure
RWA
7,928,505
5,348,202
159,479
158,570
106,964
4,757,100
4,746,787
96,361
95,142
94,936
2,580,303
51,606
10,313
206
43,013
909
39,347
1,219
100,538
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
(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) Securities financing transactions
(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 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.
272
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
g.
Explanations on Operational Risk
Current Period
Prior Period
RWA
23,489,463
6,159,650
183,800
15,010,725
2,135,288
3,893,825
3,893,825
17,794,076
4,996,400
997,925
9,123,063
2,676,688
626,412
626,412
27,383,288
18,420,488
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, 2023, the operational risk amount is TL 96,539,046 (December 31,
2022: TL 50,403,474) 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
27,720,464
33,725,058
93,016,951
3
15
7,723,123
Value at operational risk (Total*12.5)
96,539,046
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
273
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Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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
(21,568,915)
20,909,473
3,750,644
(3,811,179)
(6,416,272)
8,649,826
25,748,121
(24,234,543)
(6.80%)
6.59%
1.18%
(1.20%)
(2.02%)
2.73%
8.12%
(7.64%)
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 2023, the Remuneration
Committee met 11 times and made a total of 14 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 2023, the number of qualified employees working at the Bank is 28.
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.
274
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
Expected Credit Loss and Other Provision Expenses
Other Operating Expense
Income/Loss from Investments in Subsidiaries
Accounted by Equity Method
Corporate/
Commercial
Banking
Individual/Private
Banking
105,250,588
56,128,681
39,026,052
42,939,783
56,730,942
12,182,791
Treasury
Transaction/
Investment
Activities
72,800,572
22,407,986
4,507,778
7,097,774
10,670,920
832,240
2,605,597
30,723,421
65,258
12,223,362
194,557
824
33,996,027
Unallocated
Total
1,495,038
20,145,213
375,748
9,146,643
8,052,041
10,366,712
30,834,621
222,485,981
155,412,822
51,584,591
9,146,643
65,258
12,223,362
13,586,616
20,070,907
72,228,962
33,996,027
77,082,501
4,817,703
72,264,798
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
838,898,355
281,755,330
679,099,809
654,029,805
2,453,783,299
668,212,999
839,401,826
359,517,206
586,651,268
2,453,783,299
Corporate/
Commercial
Banking
Individual/Private
Banking
61,873,126
15,005,791
15,296,004
20,174,307
16,206,784
5,145,861
Treasury
Transaction/
Investment
Activities
40,835,759
12,441,592
3,189,166
7,017,495
5,198,926
503,115
1,568,084
13,410,401
38,604
4,522,593
108,479
74,602
21,790,674
Unallocated
Total
571,561
4,597,133
329,019
4,623,986
2,279,788
7,144,263
15,419,951
123,454,753
48,251,300
20,770,884
4,623,986
38,604
4,522,593
6,080,548
15,804,444
34,029,278
21,790,674
73,949,048
12,411,168
61,537,880
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
275
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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
SECTION FIVE: DISCLOSURES AND FOOTNOTES ON THE UNCONSOLIDATED FINANCIAL STATEMENTS
c.
Positive differences on derivative financial assets held for trading:
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
5,531,670
160,285,128
FC
25,193,169
331,566,794
926,109
TL
FC
4,108,843
17,590,529
11,613,711
165,193,959
422,611
165,816,798
357,686,072
21,699,372
177,230,281
Current Period
Prior Period
TL
FC
TL
FC
135,656,598
157,694,739
17,590,529
45,894,722
24,628,530
173,872,055
7,453,446
111,845,791
Derivative Financial Assets at Fair Value Through Profit or Loss
Forward Transactions
Swap Transactions
Futures
Options
Other
Total
d.
Information on Banks:
d.1.
Information on Banks:
Banks
Domestic Banks
Foreign Banks
Foreign Head Office and Branches
Current Period
Prior Period
TL
FC
TL
312,088
145,386
7,615
661,448
14,455,153
466,813
2,921,299
234,532
76,983
185,445
FC
689,844
14,415,860
180,079
1,246,555
465,089
18,504,713
496,960
16,532,338
Current Period
Prior Period
TL
FC
TL
FC
89
139,896
1,556,808
41,562,543
72
650,302
415,341
21,968,914
160,285,128
331,566,794
17,590,529
165,193,959
Total
1,556,897
41,702,439
650,374
22,384,255
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 0% - 30% for
TL deposits and other liabilities, between 20% - 30% for FC deposits and precious metal deposit accounts and between 5% - 21% for other FC liabilities..As of 08.07.2023,
the application of adding 5 points to the required reserve ratios determined for foreign currency deposits and precious metal deposit accounts for banks whose share of TL
deposits in total deposits calculated for real and legal persons is below 57% has been abolished as of 18.08.2023
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 31.12.2022 and numbered 32060, the possibility of establishing Turkish lira
required reserves in gold has been terminated as of 23.06.2023.
The annual 8% commission application, which is applied by differentiating according to the Turkish lira share, has been abolished as of 01.09.2023. As of 29.09.2023,
differentiated according to the transition from accounts provided with exchange rate protection support by the Central Bank to Turkish lira accounts and the renewal of these
accounts, an annual commission of 8% has been introduced.
According to the CBRT’s press release dated Dec. 27.10.2023, it was announced that the commission application has been changed according to the commission rate and
TL share according to the renewal and transition rate, accordingly, the commission rate of banks with a conversion rate below 100% will be between 6 and 8%, while banks
with a conversion rate of 100% and above will not be charged commissions to these banks if the conversion rate is 10% and above, the renewal rate is 75% and above, The
commission will be calculated for the remaining portion for banks that fall below the target in any of the relevant rates, on the other hand, effective after 22.12.2023, the renewal
rate target has been removed, the TL conversion rate target has been increased from 10% to 15%, In addition, if the TL share calculation for individuals remains below 0.5% to
2.2% by differentiating according to the TL share levels compared to the calculation period four weeks ago, 2%; if the TL share calculated for legal entities remains below the TL
share calculated according to the date of 18.08.2023, a commission rate of 1% will be applied
02.11.2023 date, published in the Official Gazette 32357, as part of the amendment to the Communique on Mandatory Provisions numbered 2013/15 (2023/30), the
mandatory provision rate for foreign currency deposits (except for deposits of foreign banks and precious metal storage accounts) to be established in Turkish lira for all
maturities is 4 percent, the mandatory provision rate previously set at 15% for all maturities in accounts provided exchange rate/price protection support by the Central Bank,
up to 6 months ( it is determined as 30% for those (including 6 months), and 10% for accounts with a maturity of 1 year or more,
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 December 31, 2023, there are no financial assets at fair value through profit and loss, which are given as collateral or blocked (December 31, 2022: 8,712,789).
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 December 31, 2023, are amounting to TL 161,016 (December 31, 2022:
TL 161,016).
b.3. TL 2,676,996 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.(31.12.2022: TL 2,039,931)
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.
Expected credit loss for cash and cash equivalents:
Restricted Amount
Unrestricted Amount
Current Period
Prior Period
Current Period
Prior Period
18,751,606
4,113,853
2,857,043
6,042,205
2,147,862
3,400,101
679,097
96,841
989,187
1,229,286
977,040
9,001,113
34,723,615
4,120,368
15,710,536
6,630,611
8,395,736
4,702,354
6,908,680
Current Period
Prior Period
Stage 1
Stage 2
Stage 1
Stage 2
Stage 1
Stage 2
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
138,336
60,371
(2,732)
Currency Exchange Difference
Current Period Ending Provisions
93,558
289,533
62,790
44,684
(3,349)
34,211
138,336
276
277
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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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 70,579,593 as of December 31, 2023 (December 31,
2022: TL 57,585,824).
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 101,888,756 as of December 31, 2023
(December 31, 2022: TL 39,650,302).
e.3.
Information on financial assets at Fair Value through Other Comprehensive Income:
Cash Loans
Standard Loans
Loans under close monitoring
Loans Not Subject to
Restructuring
Restructured Loans
Short-term Loans and Other Receivables
Medium and Long-term Loans and Other Receivables
575,617,081
470,750,114
18,877,813
23,858,492
7,026,146
51,241,530
f.4.
Information on consumer loans, retail credit cards, personnel loans and personnel credit cards:
Current Period
Prior Period
Short-Term
Medium and Long Term
Interest and Income
Accruals
Total
Debt Securities
Quoted on a Stock Exchange
Not- Quoted (*)
Share Certificates
Quoted on a Stock Exchange
Not-Quoted
Impairment Losses (-)
Other
Total
272,107,279
152,318,767
119,788,512
2,006,492
2,006,492
20,994,327
175,252,541
55,488,052
119,764,489
1,096,053
1,096,053
5,752,200
253,119,444
170,596,394
(*) 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.
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
1,663,743
1,663,743
547
547
586,440
586,440
967
967
f.2.
Information about the Standard loans and loans under close monitoring and loans under close monitoring that have been restructured:
Loans Under Close Monitoring
Restructured Loans
Cash Loans
Standard Loans
Loans Not Subject
to Restructuring
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)
278
1,046,367,195
368,559,353
165,304,833
49,575,378
153,069,411
202,388,317
107,469,903
42,736,305
13,207,629
373,855
15,955,847
10,406,157
2,792,817
Loans with
Revised Contract
Terms
39,062,751
31,516,667
152,854
Refinance
19,204,925
11,441,984
267,129
4,401,707
2,991,523
2,296,019
5,199,793
1,046,367,195
42,736,305
39,062,751
19,204,925
Current Period
Prior Period
Standard Loans
Loans Under Close
Monitoring
Standard Loans
Loans Under Close
Monitoring
4,365,200
3,676,271
14,576,370
11,705,636
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
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)
Total
120,592,793
39,138,128
5,694,858
75,759,807
1,093
1,093
7,398,313
7,398,313
226,883
8,353
3,871
214,659
12,519
12,519
29,855,067
72,785
197,655
29,584,627
152,774,425
61,109,311
91,665,114
466,826
466,826
549,680
980
548,700
656,623
274,216
382,407
4,036
4,036
16,761,702
2,733,291
532,064
85,623
2,115,604
19,135
19,135
1,744,448
230,790
1,513,658
64,630
118
235
64,277
153,181,151
39,742,977
5,978,136
107,460,038
20,228
20,228
161,917,186
68,738,414
93,178,772
466,826
466,826
841,193
8,471
5,086
827,636
2,449
2,449
517,003
671,591
286,735
384,856
4,036
4,036
17,278,705
201,068,359
128,231,601
5,080,956
334,380,916
279
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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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
Commercial Loans with Installments-FC
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
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
Short-Term
Medium and Long
Term
Interest and
Income Accruals
37,804,509
2,897
1,364,970
36,436,642
81,336,875
2,691,575
11,720,448
66,924,852
45,475
999
44,476
113,440
5,106,498
2,466,949
28,878
149,969
2,288,102
332,001
7,478
324,523
42,840
Total
121,608,333
2,723,350
13,235,387
105,649,596
377,476
8,477
368,999
5,262,778
113,440
5,106,498
42,840
5,262,778
1,507,059
1,507,055
4
52,235,926
18,587,027
33,648,899
50,620
50,620
6,924,663
342,937
342,937
355,967
54,085,922
20,094,082
33,991,840
50,620
50,620
7,280,630
97,129,158
87,995,907
3,540,694
188,665,759
Current Period
Prior Period
8,081,589
1,139,289,587
1,147,371,176
Current Period
Prior Period
1,109,986,465
37,384,711
1,147,371,176
Current Period
Prior Period
30,091,136
30,091,136
Current Period
Prior Period
4,767,258
1,583,245
12,481,427
18,831,930
6,639,607
752,649,584
759,289,191
736,260,169
23,029,022
759,289,191
13,925,479
13,925,479
1,229,326
2,353,691
13,624,095
17,207,112
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
280
Group III
Loans with Limited Collectability
Group IV
Loans with Doubtful Collectability
Group V
Uncollectible Loans
248,439
248,439
1,199,485
1,199,485
165,193
165,193
135,860
135,860
6,620,291
6,620,291
6,148,323
6,148,323
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
Loans with Doubtful
Collectability
Group V
Non-Performing Loans
2,522,196
1,731,162
555,108
235,926
15,553,028
8,894,484
3,847,277
2,810,526
741
7,766,430
3,818,024
2,543,922
1,403,743
741
2,086,412
349,825
984,363
752,224
6,437
322
2,841
3,274
1
1
3,685
3,635
50
8,219,629
6,461,110
871,309
887,210
4,767,258
3,880,316
373,013
513,929
3,452,371
4,684,865
3,483,602
889,499
311,764
50,659
31,678
6,777
11,836
368
7,766,430
3,818,024
2,543,922
1,403,743
741
7,104,738
4,813,466
1,633,643
656,520
1,109
2,811,933
1,975,795
566,529
269,609
7,061
280
1,822
4,959
186
5
164
17
1,863
1,464
399
2,579,899
545,222
1,238,439
796,238
1,583,245
337,398
693,438
552,409
996,654
15,927,069
13,983,947
1,229,709
655,521
57,892
159,191
130,855
4,797
4,757
18,782
7,104,738
4,813,466
1,633,643
656,520
1,109
6,242,978
5,273,136
728,514
236,944
4,384
1,954,736
1,930,837
10,236
13,650
13
915,836
347,597
322,885
236,980
8,374
42,772
38,079
4,509
184
14,120,220
11,414,777
1,811,023
829,224
65,196
12,481,427
10,315,210
1,380,631
723,957
61,629
1,638,793
(*) As of 31.12.2023, as part of the amendment to the “Procedures and Principals regarding Classification of Loans and Allowances Allocated for Such Loans” published in the Official Gazette No. 30961,
dated 27.10.2019, receivables amounting to TL 1,953,948 was written off.
(**) in August 2023, our receivables, which constitute 711,576 TL of the portfolio consisting of non-performing loans receivables, were transferred to Birikim Varlık Yönetim A.Ş., Denge Varlık Yönetim A.Ş.,
Dünya Varlık Yönetim A.Ş., Gelecek Varlık Yönetim A.Ş., Ortak Varlık Yönetim A.Ş., Sümer Varlık Yönetim A.Ş. by collecting the sales price of 279,200 TL in cash. 1,969 TL of our transferred receivables arise
from our receivables that were previously written off from assets within the framework of the amendment made to the “Regulation on the Procedures and Principles Regarding the Classification of Loans
and Provisions to be Set Aside for These” published in the Official Gazette dated 27.11.2019 and numbered 30961.
After the sale of non-performing loans and the write-off, the Banks’s non-performing loan ratio decreased from 2,36% to 2.13% as of 31.12.2023.In December 2023, our receivables, which constitute
357,994 TL of the portfolio consisting of non-performing loans receivables, were transferred to Dünya Varlık Yönetim A.Ş., and Emir Varlık Yönetim A.Ş. by collecting the sales price of 111,400 TL in cash. TL
151,578 of our transferred receivables arises from our receivables that were previously written off from assets within the framework of the amendment to the “Regulation on the Procedures and Principles
Regarding the Classification of Loans and the Provisions To Be Set Aside For Them” published in the Official Gazette dated 27.11.2019 and numbered 30961.
281
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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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
4,850,534
2,898,780
1,951,754
1,292,736
598,592
694,144
231,435
144,230
87,205
3,127,450
1,465,512
1,661,938
8,164,356
7,345,390
818,966
9,872,746
8,569,151
1,303,595
(*) 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)
3,452,371
8,219,629
4,767,258
3,452,371
1,292,870
2,522,196
1,229,326
1,292,870
996,654
2,579,899
1,583,245
996,654
2,331,174
4,684,865
2,353,691
2,331,174
1,638,793
14,055,024
12,419,798
1,635,226
65,196
61,629
3,567
2,302,974
15,869,177
13,575,741
2,293,436
57,892
48,354
9,538
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
221,083
516,650
295,567
80,448
157,503
77,055
80,901
200,706
119,805
330,000
644,931
314,931
242,739
1,718,759
1,476,020
251,521
1,483,646
1,232,125
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.
282
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
Provisions beginning of the period
3,676,271
11,705,636
17,207,112
3,417,459
11,094,455
13,790,995
Current Period
Stage 1
Stage 2
Stage 3
Stage 1
Prior Period
Stage 2
Stage 3
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
Provisions at the end of the
period
2,012,879
6,111,950
7,050,146
2,594,541
4,207,497
9,560,435
(1,873,284)
(2,137,840)
838,135
(264,418)
(58,007)
33,624
(823,484)
281,065
(874,170)
313,213
(3,668,111)
(2,486,763)
(14,651)
(16,647)
932,177
(171,333)
(2,622,121)
(2,149,836)
(2,558,495)
477,898
(173,497)
(46,578)
28,569
(466,158)
187,085
(4,976,818)
(11,740)
(13,588)
(1,358,108)
1,404,686
190,701
11,637
4,365,200
14,576,370
18,831,930
3,676,271
11,705,636
17,207,112
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 53,767,947 as of December 31, 2023 (December 31, 2022: TL 58,013,328).
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 19,942,084 as of December 31, 2023 (December 31, 2022: TL
4,989,769).
g.3.
Information on government securities measured at amortised cost:
Current Period
Prior Period
Government Bonds
Treasury Bills
Other Public Debt Securities
Total
g.4.
Information on financial assets measured at amortised cost:
180,283,315
180,283,315
Debt Securities
Quoted on a Stock Exchange
Not Quoted (*)
Impairment Losses (-)
Total
Current Period
Prior Period
196,022,961
183,094,546
12,928,415
196,022,961
(*) 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
93,373,997
6,987,406
120,829,692
(39,873,429)
14,705,295
196,022,961
87,040,233
87,040,233
93,373,997
90,007,186
3,366,811
93,373,997
46,412,734
2,181,993
55,070,273
(19,171,942)
8,880,939
93,373,997
283
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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
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:
54,945
191,557
(52,590)
91
194,003
20,343
53,189
(18,655)
68
54,945
No.
1
2
Title
Address (City/ Country)
Bank’s Share Percentage-If
Different, Voting Percentage (%)
Bank’s Risk Group Share Percentage (%)
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
15,563,601
2,201,737
1,016,199
1,201,571
242,443
456,170
972,037
29,452
97
900
162,652
128,363
215,338
29,975
(*) Shows September 30, 2023, amounts for Kredi Kayıt Bürosu A.Ş. and December 31, 2023, amounts for Arap Türk Bankası A.Ş
(**) 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 / Decrease(*)
Impairment
Other
Balance at the end of the period
Capital commitments
Contribution in equity at the end of the period (%)
(*) The differences arising from accounting by equity method is included.
h.4. Sectoral information on financial associates and the related carrying amounts:
Associates
Banks
Insurance Companies
Factoring Companies
Leasing Companies
Finance Companies
Other Financial Participations
Total
284
Current Period
Prior Period
399,382
311,081
75,682
88,301
475,064
399,382
Current Period
Prior Period
453,026
385,225
h.5. Associates quoted on a stock exchange: None.
h.6. Associates disposed of in the current period: None.
h.7. Associates acquired in the current period: None.
i.
Information on subsidiaries (Net):
i.1.
Information on the equity of major subsidiaries:
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 (*):
Türkiye Sınai Kalkınma
Bankası A,Ş,
Insurance / Reinsurance
Companies
İş Finansal Kiralama A,Ş,
İşbank AG
21,747,485
1,007,980
20,739,505
16,489,214
202,442
16,286,772
6,097,045
29,990
6,067,055
12,560,904
202,947
12,357,957
20,739,505
16,286,772
6,067,055
12,357,957
7,074,994
7,074,994
27,814,499
16,286,772
6,067,055
12,357,957
27,814,499
16,286,772
6,067,055
12,357,957
No
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
Title
Address (City/ Country)
Bank’s Share Percentage-if
Different, Voting Rights (%)
Bank’s Risk Group Share
Percentage (%)
Anadolu Hayat Emeklilik A.Ş.
Joint Stock Company İşbank
Joint 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
Kültür Yayınları İş Türk A.Ş.
Milli Reasürans T.A.Ş.
Trakya Yatırım Holding A.Ş.
Türkiye Sınai Kalkınma Bankası A.Ş.
Türkiye Şişe ve Cam Fabrikaları A.Ş.
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
51.06
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
58.89
100.00
(*) The purchased free float shares of listed subsidiaries within the scope of the relevant Board of Directors Decisions 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.
453,026
385,225
285
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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, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
i.3. Financial statement information related to subsidiaries 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 (**)
Additional
Shareholders’
Equity
Required
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
162,865,081
6,449,458
11,890,612
2,196,726
5,158,288
1,484,387
303,078
139,393
102,809
1,693,711
1,461,713
2,853,815
1,391,752
16,229,060
561,284
327,419
422,943
155,201
478,434
82,366
51,557,546
6,769,900
65,031
7,293,713
37,574
1,767,060
826,766
7,779,741
31,191,034
25,209,951
24,696,795
121,520
438,861
11,175,211
8,364,189
14,340,024
690,275
397,736
349,747
114,043
60,290
57,416
32,456
12,187
75,126
172,925
12,938
87,639
24,512
41,220,341
16,512,401
378,891
4,643,010
8,082,005
9,811,742
4,529,607
45,652,500
67,285,904
14,039,466
451,318
2,822,060
215,677
159,137
22,668,143
10,128,118
13,167
183,087
16,192,501
13,878,897
1,439,415
1,372
510,231
395,143
180,913,852
21,825,052
3,675,723
18,772,862
860,199
46,530
362,369
3,629,008
968,928
116,044
167,740
323,549
33,587
888,620
281,338
7,149,926
4,105,739
18,242,000
267,386,202
146,411,631
141,450,918
3,385,090
1,213,177
25,225,977
20,133,429
141,832,935
1,385,991
94,464
7,114
41,958
477
47,877
2,351
(*) Within the framework of BRSA regulations, it contains 31,12,2023 values that have not been subject to inflation accounting
(**) İş Net Elektronik Bilgi Üretim Dağıtım Ticaret ve İletişim Hizmetleri A.Ş., Kültür Yayınları İş Türk A.Ş. as of December 31, 2022, others are Decemer 31, 2023.
i.5. Sectoral information on financial subsidiaries and the related carrying amounts:
Related Companies
Current Period
Prior Period
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.
28,573,981
14,039,712
1,472,096
23,379,830
67,465,619
Current Period
Prior Period
102,444,128
102,444,128
16,800,054
7,310,823
937,316
12,325,177
37,373,370
61,173,685
61,173,685
As announced in the special event disclosures dated 25.08.2023 and 27.10.2023, it was decided to continue the partial division transactions in a facilitated procedure with the
participation model, through the financial statements dated 31.12.2023.
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
(***) Fair value represents the company's market value
i.4. Movement of investments in subsidiaries:
Balance at the Beginning of the 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 (%)
Current Period
Prior Period
79,460,092
39,150,264
9,353,816
3,714,714
143,978,072
79,460,092
1,000,000
55,164,164
36,595,114
Accumulated Depreciation
(9,990)
(1,882,850)
Prior Period
Cost
13,453,256
3,801,501
104,100
13,443,266
1,918,651
104,100
44,721
(24,400)
20,321
4,423,553
(2,712,943)
1,710,610
21,827,131
(4,630,183)
17,196,948
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 (*)
Cost at the Period End
27,935,530
13,443,266
1,918,651
14,685,467
(73,511)
(133,192)
1,743,437
(774,515)
29,568
5,723,142
104,100
217,052
321,152
20,321
10,299
(4,707)
893
56,881
1,710,610
17,196,948
2,126,850
(799,741)
5,938
18,783,105
(1,652,474)
(133,192)
36,399
6,574,550
40,611,255
(*) The current period balance is due to the capital increase of Trakya Investment Holding A,S, by classifying the monitored shares of Anadolu Hayat Emeklilik A,Ş, Iş Finansal Kiralama A,Ş, and Türkiye
Bottle and Glass Factories A,Ş, under subsidiaries in the Financial Assets at Fair Value through Profit and Loss account.
(**) The differences arising from accounting by equity method is included.
(***) The committed capital of Trakya Yatırım Holding.
Accumulated Depreciation at the Period
End
(13,500)
(2,806,001)
(30,075)
(3,530,893)
(6,380,469)
Closing Net Book Value
27,922,030
2,917,141
321,152
26,806
3,043,657
34,230,786
(*) The balance includes the movements in cost and accumulated depreciation items.
286
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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, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
n.
Information on Intangible Assets:
II. DISCLOSURES AND FOOTNOTES ON LIABILITIES
Current Period
Prior Period
a.
Information on Deposits:
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:
3,514,433
4,129,310
(1,249,452)
4,364
10,838,426
(4,439,772)
6,398,654
1,750,109
2,515,348
(753,272)
2,248
6,700,672
(3,186,240)
3,514,433
The bank has deferred tax assets of TL (12,090,016) (1,080,530 TL deferred tax liability as of December 31, 2022) as of December 31, 2023. The deferred tax asset in
question is calculated on the basis of temporary differences between assets and transfers that are tracked with book value in the Bank’s records and their tax bases calculated
in accordance with the tax legislation. If the items that constitute temporary differences are tracked among equity items, the deferred tax asset/liability calculated over these
temporary differences is associated with the relevant equity items.
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
71,985,637
16,002,082
157,038,120
227,466,867
17,360,564
12,239,090
Foreign Currency Deposits
399,434,055
48,166,289
142,071,627
20,305,227
6,110,219
30,521,536
Residents in Turkey
342,557,790
45,311,121
112,751,710
17,550,796
2,440,634
5,406,453
Residents Abroad
56,876,265
2,855,168
29,319,917
2,754,431
3,669,585
25,115,083
3,774
1,068
1,068
Public Sector Deposits
Commercial Deposits
Other Institutions Deposits
1,634,553
61,317,796
1,676,230
75,221
366,251
122,942
430
5
87,330,985
24,791,699
71,715,294
25,911,503
12,497,610
2,997,524
5,529,104
5,328,329
103,904
9,942
Precious Metals Deposits
102,599,647
2,937
3,979,932
821,987
8,683,669
364,383
Interbank Deposits
1,963,095
79,272,347
3,115,580
1,702,213
1,792,974
7,764,453
The Central Bank of
the Republic of Turkey
Domestic Banks
Foreign Banks
Participations Banks
974
35,846
1,925,452
823
75,646,900
502,329
164,775
3,625,447
2,613,251
1,702,213
1,628,199
7,764,453
502,096,134
646,610,021
526,019,572
120,590,449
2,199,402
283,564,887
15,645,033
116,452,555
95,610,662
974
76,349,850
19,259,015
823
Deferred Tax (Asset)/Liability:
Tangible Assets Base Differences
Provisions (*)
Valuation of Financial Assets
Other
Net Deferred Tax (Asset)/Liability:
Current Period
Prior Period
Other
Total
640,611,013
233,847,385
336,892,313
327,462,859
59,963,263
63,397,019
4,842 1,662,178,694
663,410
(12,777,208)
160,945
(137,163)
(12,090,016)
1,900,474
(7,694,748)
6,930,464
(55,660)
1,080,530
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 31.12.2023, the amount of
the foreign exchange-protected deposits opened within this scope is TL 280,700,031 (31.12.2022: 130,418,788 TL).
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
52,151,311
13,192,421
57,543,852
89,132,133
5,629,299
4,469,259
4,453
222,122,728
(*) Employee rights liabilities consist of pension fund actual and technical deficit, credit card points provisions, expected loss provisions for I. and II. stage loans and other provisions.
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
Current Period
Prior Period
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:
q.
Information on assets held for sale and discontinued operations:
(1,080,530)
5,398,154
7,772,365
27
12,090,016
Balance at the Beginning of the Period
Transfers (Net)
Depreciation (Net)
Impairment Losses (-)
Balance at the End of the Period
Current Period
Prior Period
1,600,625
(60,141)
110
1,540,594
2,557,610
4,792,962
(8,430,917)
(185)
(1,080,530)
827,633
779,736
(6,744)
1,600,625
(*) TL 1,249,492 of the change in the prior period relates to the transfer of 12.28% of the share capital of Genel Energy Plc. to the Bank for receivables.
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.
The Bank has no discontinued operations.
r.
Information on Other Assets:
The “other assets” item of the balance sheet does not exceed 10% of total assets.
288
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
Public Sector Deposits
Commercial Deposits
34,194,663
948,455
55,067,638
2,175,001
19,448,507
1,900,128
1,103,037
11,155,234
20
69,976,590
41,996
218,359
2,352
412
5
53,590,998
12,165,643
19,907,452
8,470,551
4,974,482
Other Institutions Deposits
933,998
1,585,467
2,555,476
Precious Metals Deposits
61,964,641
10,925
3,864,020
126,370
221,532
11,971
8,091,907
30,133
339,773
Interbank Deposits
1,493,230
3,783,386
2,189,927
79
461,663
1,896,924
The Central Bank of the
Republic of Turkey
Domestic Banks
Foreign Banks
Participations Banks
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
1,211,579
154,176,764
5,243,415
74,492,798
9,825,209
756
3,043,105
6,780,768
580
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
289
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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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
Under the Guarantee of Savings Deposits Insurance
Fund
Exceeding the Limit of Deposit Insurance Fund
Current Period (*)
Prior Period
Current Period
Prior Period
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
179,078,644
142,427,842
53,207,056
98,271,661
76,393,000
26,836,200
320,081,874
271,482,690
60,492,920
122,016,357
221,588,222
41,995,951
21,594,235
11,433,523
4,785,854
3,622,595
(*) 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 36,212,609 within the scope of the insurancein current
period, 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
4,785,854
3,622,595
Current Period
Prior Period
Derivative Financial Liabilities at Fair
Value Through Profit or Loss
Current Period
Prior Period
TL
FC
TL
FC
Forward Transactions
Swap Transactions
Futures
Options
Other
172,695
398,055
792,729
4,732,341
1,117,558
104,067
2,700,243
32,132
578,912
5,180,889
244,575
Total
570,750
6,642,628
2,836,442
6,004,376
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, 2023
November, 2023
Securitization deals:
Funds Borrowed
224,000,000 USD + 388,250,000 EUR
465,000,000 USD +411,000,000 EUR
Maturity
1 year
1 year
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
June 2012
TIB Diversified Payment Rights Finance Company
December 2013
TIB Diversified Payment Rights Finance Company
December 2014
TIB Diversified Payment Rights Finance Company
March 2015
TIB Diversified Payment Rights Finance Company
October 2015
TIB Diversified Payment Rights Finance Company
October 2016
TIB Diversified Payment Rights Finance Company
Amount
125,000,000 EUR
50,000,000 EUR
220,000,000 USD
15,000,000 USD
221,200,000 USD
55,000,000 USD
Final
Maturity
12 years
12 years
14 years
15 years
10 years
12 years
Remaining Debt Amount as at
December 31, 2022
9,375,000 EUR
10,000,000 EUR
100,000,000 USD
11,718,750 USD
48,387,500 USD
26,829,260 USD
64,005,715 USD
11,000,000 USD
77,380,952 USD
227,000,000 USD
195,000,000 USD
50,000,000 EUR
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):
Bills
Bonds
Total
Current Period
Prior Period
TL
FC
TL
FC
389,926
907,684
1,297,610
735,314
66,453,120
67,188,434
1,755,212
402,745
2,157,957
26,156,146
26,156,146
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:
77,781
39,447
December 2016
TIB Diversified Payment Rights Finance Company
158,800,000 USD
10-13 years
December 2017
TIB Diversified Payment Rights Finance Company
December 2017
TIB Diversified Payment Rights Finance Company
August 2022
TIB Diversified Payment Rights Finance Company
November,23
TIB Diversified Payment Rights Finance Company
November,23
TIB Diversified Payment Rights Finance Company
55,000,000 USD
125,000,000 USD
227,000,000 USD
195,000,000 USD
50,000,000 EUR
7 years
9 years
5 years
5 years
5 years
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
290
Current Period
Prior Period
TL
FC
TL
FC
e. Concentration on the Bank's liabilities:
472,625
2,849,095
3,321,720
5,420,748
112,023,642
117,444,390
802,041
2,564,571
3,366,612
8,117,800
59,970,914
68,088,714
Current Period
Prior Period
TL
FC
TL
FC
553,296
2,768,424
3,321,720
9,518,023
107,926,367
117,444,390
969,816
2,396,796
3,366,612
5,720,964
62,367,750
68,088,714
68% 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.
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
Between 1-4 Years
More than 4 Years
Total
Current Period
Prior Period
Gross
Net
Gross
Net
2,956
438,554
6,800,568
7,242,078
2,801
346,068
2,918,174
3,267,043
516
419,468
4,271,686
4,691,670
483
308,361
1,843,363
2,152,207
291
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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, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Current Period
Prior Period
Current Period
Prior Period
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 23,489,83 (exact TL amount as of December 31,
2023), 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, 2023, provision amounting to TL 5,269,706 is
reflected in the financial statements (December 31, 2022: TL 5,290,639).
Main actuarial assumptions used in calculation of severance pay liability are as follows:
In the calculation, the discount rate is 23.58%, the inflation rate is 19.65%, and the real wage increase rate is 2%.
In the calculation, the ceiling of 24,489,83 TL (full TL amount) valid as of 31.12.2023 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
5,290,639
384,155
1,147,833
(1,707,843)
3,921
239,358
(88,357)
5,269,706
2,278,323
158,573
421,268
(173,319)
10,174
1,941
2,593,679
5,290,639
In addition to the employee termination benefits the Bank allocates provisions for the unused vacation pay liability. As of December 31, 2023, provision for unused vacation pay
is amounting to TL 375,111 (December 31, 2022: TL 216,615).
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, 2023, and December 31, 2022,
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, 2023, the Bank’s specific provisions for indemnified non-cash loans balance is TL 2,891,615 (December 31, 2022: TL 1,616,688) 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, 2023 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 14,288,742. 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, 2023, 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, 2023, taking the health expenses within the Social Security Institution
limits into account.
Current Period
Prior Period
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.
(57,235,905)
25,775,506
(31,460,399)
(6,190,532)
18,687,242
12,496,710
4,674,947
(14,288,742)
Cash and Cash Equivalents
Securities Portfolio
Other
Total
3,366,702
604,264
703,981
4,674,947
(30,350,164)
13,123,522
(17,226,642)
(2,986,675)
9,514,553
6,527,878
2,319,023
(8,379,741)
1,240,842
742,714
335,467
2,319,023
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, 2023, the Bank has recognized provisions amounting to TL 642,592 for the
amount which is recognized within the framework of credit card expenses of credit card customers or promotions for banking services. (December 31, 2022: TL 235,129).
i.4.3. 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.
In the legal process, positive results could not be obtained from the individual application made by the Bank to the Constitutional Court, and the negative declaratory action
brought against the Bank to determine that the Bank is not indebted from the ongoing lawsuits has been finalized. An agreement was reached by mutual release and the total
balance subject to trial was paid to the SDIF as USD 48 million on 05.02.2024, and 31 for the entire related amount., the required provision has been allocated in the financial
statements as of 12.2023.
i.4.4. 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 10,000,000 of which TL 8,475,000 provided in prior years and TL
1,525,000 was provided in the current period.
292
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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
j.
Information on Tax Liability:
j.1.
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 31.12.2023, the remaining corporate tax debt as a result of netting of
temporary taxes paid with corporate tax liability is TL 6,531,016. (31.12.2022: TL 5,311,636)
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: None.
Current Period
Prior Period
6,531,016
869,297
9,051
1,620,948
40,098
118,176
383,708
9,572,294
Current Period
Prior Period
1,700
1,962
10,646
21,295
35,603
5,311,636
376,516
7,431
570,782
52,378
67,390
158,108
6,544,241
646
756
5,759
11,520
8
18,689
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
Bank has issued subordinated debt securities, to be included in the contribution capital calculation, with the following nominal values;
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% (effective from June 29, 2023 with an interest rate of 9.192%) 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 39,870,982 as of December 31, 2023 (December 31, 2022: TL 33,558,745).
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:
m.1. Presentation of paid-in capital:
Common shares
Preferred shares
Total
2,324,411
37,546,571
2,277,824
31,280,921
2,324,411
2,324,411
37,546,571
37,546,571
2,277,824
2,277,824
31,280,921
31,280,921
Current Period
Prior Period
9,999,970
30
10,000,000
9,999,970
30
10,000,000
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
Registered Capital System
10,000,000
25,000,000
Capital System
Paid-in Capital
Ceiling
294
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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
m.3. The capital increase made in current period: None.
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.
m.6. Information regarding the shares of the company acquired: The Bank has repurchased shares amounting to TL 530,307 in accordance with the 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.
III. DISCLOSURES AND FOOTNOTES ON OFF BALANCE SHEET ITEMS
a. Explanations to Liabilities Related to Off-Balance Sheet Items:
a.1. Types and amounts of irrevocable loan commitments:
Commitment for customer credit card limits amounts to TL 417,894,567 and commitment to pay for cheque leaves amounts to TL 9,204,813. The amount of commitment for
the forward purchase of assets is TL 14,051,660 and for the forward sale of assets is TL 14,052,028.
a.2. The structure and amount of probable losses and commitments resulting from off-balance sheet items, including those below:
As of December 31, 2023, the Bank’s provisions for indemnified non-cash loans balance is TL 2,891,615 (December 31, 2022: TL 1,616,688) 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:
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
Total
n.
Information on Dividend Distribution:
Current Period
Prior Period
TL
FC
TL
FC
3,575,649
5,098,570
(1,522,921)
(1,805,393)
(2,495,5289
690,135
29,145,057
38,852,687
(9,707,630)
(4,586,932)
(5,949,482)
1,362,550
3,575,649
(1,805,393)
29,145,057
(4,586,932)
At the Bank’s Ordinary General Assembly, held on March 30, 2023, it was decided to allocate net profit from operating
activities of 2022, amounting to TL 61,537,880 as follows;
adding a total of TL 165,466, which is formed within the framework of various legislative regulations and is monitored in the profits of previous years,
the balance sheet profit based on distribution amounting to TL 61,703,346 formed accordingly, TL 204,246 arising from real estate sales gains, of which it was decided to
be used in capital increase, including the separation of TL 989 venture capital investment related to R&D discount, allocating a total of TL 476,341 as special reserves, of
which TL 272,095 is allocated to venture capital investment trusts and funds,
Addition of the provision amount of TL 3,093,000 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”,
of the amount as a basis for distribution of TL 64,320,005;
TL 9,230,643 to A, B and C group shares as cash,
TL 39 to the founding shares as cash,
TL 3,092,161 as cash dividend to employees to be distributed,
TL 51,997,162 as legal and extraordinary reserves to be reserved,
has been decided. As of March 30, 2023; TL 51,997,162 was transferred to reserves account, cash dividends were distributed to the shares other than the shares acquired by
the Bank, as of April 3, 2023.
Since the Bank’s Ordinary General Assembly Meeting for 2023 has not been held as of the report date, the profit from the activities of the aforementioned period has not been
distributed
Bank Acceptances
Letters of Credit
Other Guarantees
Total
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
15,800,134
85,384,944
6,231,597
107,416,675
9,331,476
53,246,223
4,836,131
67,413,830
Current Period
Prior Period
6,461,015
181,228,524
38,014,215
14,947,470
79,302,905
319,954,129
2,855,259
107,173,811
19,399,879
9,508,835
40,344,900
179,282,684
Current Period
Prior Period
79,302,902
14,101,754
65,201,148
348,067,902
427,370,804
40,344,898
11,721,587
28,623,311
206,351,616
246,696,514
296
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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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
TL
915,302
790,750
112,662
11,890
61,476,105
2,222,351
48,629,885
10,623,869
22,678,856
80,815,381
Wholesale and Retail Trade
45,885,373
Current Period
(%)
0.55
0.47
0.07
0.01
FC
706,706
691,255
15,451
36.95
146,578,672
1.33
1,825,487
29.23
128,780,336
6.39
13.63
48.58
27.58
15,972,849
39,955,909
67,591,473
29,539,833
(%)
0.27
0.26
0.00
0.01
56.16
0.70
49.34
6.12
15.31
25.89
11.32
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
Hotel and Restaurant
Services
Transport and
Communications
Financial Institutions
18,895,736
11.36
13,290,622
8,148,175
4.90
19,068,607
1,695,948
1.02
794,264
0.30
1,159,849
Prior Period
(%)
0.68
0.54
0.12
0.02
FC
278,356
239,893
38,463
35.54
87,898,245
1.11
27.45
6.98
11.16
52.24
30.07
1.29
1,098,016
77,959,018
8,841,211
24,793,816
42,402,651
20,128,969
790,171
Real Estate and Rental
Services.
4,043,004
Self-Employment Services
1,034,103
Education Services
Health and Social Services
Other
Total
386,245
726,797
475,991
2.43
0.62
0.23
0.44
0.29
4,168,935
243,485
8,671
477,056
6,176,409
166,361,635
100
261,009,169
7.31
5.09
1.60
0.09
0.00
0.18
2.37
100
5,336,375
5.93
11,905,619
9,684,784
10.75
7,338,409
2,320,340
812,991
111,558
541,787
337,958
2.58
0.90
0.12
0.60
0.38
1,785,260
128,125
6,549
319,549
1,260,141
90,063,305
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
a.7. Non-cash Loans classified under Group I and Group II:
Non-cash Loans
Letters of Guarantee
Bank Acceptances
Letters of Credit
Endorsements
Underwriting Commitments of the Securities Issued
Factoring Related Guarantees
Other Guaranties and Warranties
b.
Explanation on Derivative Financial Instruments:
Group I
Group II
TL
164,367,644
154,801,760
9,434,550
131,334
FC
250,225,907
153,526,418
6,365,084
84,139,136
TL
1,731,127
1,730,627
500
FC
5,233,165
4,579,801
653,364
6,195,269
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 30,363,985
The cheques given to customers is presented under off balance sheet commitments, as per the related regulations is amounting to TL 9,204,813. In case the cheques
presented for payment to beneficiaries are not covered, the Bank will be obliged to pay the uncovered 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 6,000 (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
Premiums Received from State Resource
Utilization Support Fund
Current Period
Prior Period
TL
FC
TL
FC
57,546,481
55,516,172
3,492,159
9,918,294
23,013,230
6,199
22,751,665
39,871,722
2,436,866
3,985,147
13,533,080
1,429
Total
116,554,812
32,937,723
65,060,253
17,519,656
(*) 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:
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
FC
TL
FC
148,447
88,174
38,987
4,899
528,654
155,264
39,543
52,130
2,725
194,883
236,621
572,540
194,807
249,738
Current Period
Prior Period
TL
FC
TL
FC
38,646
37,872,160
27,337,648
65,248,454
384,866
4,288,810
642,788
5,316,464
49,293
21,905,813
14,951,212
36,906,318
186,669
2,341,238
224,110
2,752,017
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 2023, the Parent Bank’s pre-tax profit will increase by approximately TL 147 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
2,385,488
1,253,289
Current Period
Prior Period
298
299
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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
b.2. Information on interest paid to associates and subsidiaries:
Current Period
Prior Period
TL
FC
TL
FC
384,477
5,230,567
405,533
2,060,113
106,448
278,029
264,358
4,966,209
1,419,186
130,560
274,973
384,477
6,649,753
405,533
218,652
1,841,461
527,877
2,587,990
Interest Paid to Associates and Subsidiaries
3,284,699
820,602
Current Period
Prior Period
b.3. Information on interest paid on marketable securities issued:
Current Period
Prior Period
TL
FC
TL
FC
Interest on Securities Issued
977,456
6,431,642
1,144,803
4,625,715
b.4. Information on Interest Expense on Deposits According to Maturity Structure:
Current Period
Demand
Deposits
TL
Bank Deposits
Savings Deposits
60
106
Up to One
Month
Up to Three
Months
Up to Six
Months
Up to One Year Over One Year
Accumulated
Deposits
Total
Time Deposits
3,055,134
183,747
3,238,941
2,252,500
25,071,982
42,191,641
2,213,742
1,233,077
394
72,963,442
Public Sector Deposits
9,358
110,246
13,742
19
Commercial Deposits
1,450
17,702,527
6,573,255
10,066,675
3,348,891
1,514,327
759,413
1,703,750
607,223
13,205
137
133,365
39,207,125
3,083,728
1,616
23,778,932
33,642,980
52,879,281
5,575,857
2,747,541
394
118,626,601
97
265,462
880,859
484,485
105,349
753,437
7
2,489,696
233,825
201,132
65,830
46,595
335,168
882,550
5,623
11,030
10,569
520
27,742
97
499,287
1,087,614
561,345
162,513
1,089,125
7
3,399,988
1,713
24,278,219
34,730,594
53,440,626
5,738,370
3,836,666
401
122,026,589
Other Institutions
Deposits
Deposits with 7 Days
Notice
Total
FC
Foreign Currency
Deposits
Bank Deposits
Deposits with 7 Days
Notice
Precious Metals
Deposits
Total
Grand Total
300
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
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
Public Sector Deposits
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
Other Institutions
Deposits
Deposits with 7 Days’
Notice
Total
FC
Foreign Currency
Deposits
Bank Deposits
Deposits with 7 Days’
Notice
Precious Metals
Deposits
Total
Grand Total
212
6,427,560
10,661,370
11,574,490
1,995,864
775,911
464
31,435,871
57
18
75
287
90,662
616,716
55,377
51,284
14,074
2,463
6,079
1,775
166,602
15,267
2
935,495
84,881
11
6,524
744
16,422
890
24,591
141,957
637,314
58,584
24,276
6,569,517
11,298,684
11,633,074
2,020,140
182,759
958,670
2
1,044,967
466
32,480,838
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
16,028
49,230
65,258
12,976
25,628
38,604
Current Period
Prior Period
8,132,487
58,817,357
2,167,430,437
813,162
64,851,084
2,156,492,673
12,223,362
3,326,481
40,382,196
1,548,951,173
11,654
53,925,636
1,534,199,967
4,522,593
(*) Income arising from foreign currency changes related to derivative transactions amounts to TL 38,030,389 and the losses amount to TL 45,782,379 and the amount of net losses TL 7,751,990
(December 31, 2022, profit: TL 27,805,262, loss: TL 44,333,328).
e.
Information on other operating income:
Other operating income mainly consists of expected loss provisions for loans or collections from Stage-3 loans, cancellations of free provisions set aside for possible risks in
previous periods, fee income from customers in return for various banking services and income from the sale of fixed assets. 2,000,000 TL of free provisions for possible risks
in prior periods have been reversed in the current period.
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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
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
15,906,083
1,365,521
4,077,825
10,462,737
824
824
10,036,266
909,902
653,381
8,472,983
74,601
18,954
55,647
4,164,000
20,070,907
5,693,577
15,804,444
(*)Current period balance, with free provision expense of TL 3,525,000, details of the Fifth Part I-lII- g,4,3 no., lu consists of the amount of TL 639,000 allocated for the litigation provision expense
included in the footnote in the current period.
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 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
Current Period
Prior Period
720,366
5,909,001
142,047
1,652,474
1,249,452
7,403
749
28,300,349
245,152
760,284
1,506,331
25,788,582
8,318
8,931,779
46,921,938
418,637
2,284,686
3,937
911,637
753,272
33,675
11,266,794
154,605
398,243
677,733
10,036,213
4,341
3,256,651
18,933,630
(*)) The amount of expenditure made by the Bank within the scope of donation, aid and social responsibility projects in the current period is total TL 348,272 (December 31, 2022:TL 119,660).
(**)It includes a cash donation of 2,300,000 TL made by companies included in the consolidation to the Disaster and Emergency Management Presidency (AFAD) due to the earthquake disaster, in the
current period the part of the related item amounting to TL 1,491,290 (31.12.2022: TL 665,046) is comprised of expenses of fees, taxes, pictures and funds.
The Bank’s profit before tax arises from continuing activities. As of 31 December 2023, TL 67,073,159 of the profit before tax consists of net interest income, TL 42,437,948 of
net fee and commission income, and the total of personnel expenses and other operating expenses is TL 72,228,962.
j.
Information on provision for taxes from continuing and discontinued operations
As of December 31, 2023, the amount of the Bank’s tax provision is TL 4,817,703 and the amount consists of current tax expense that is amounting to TL 10,215,857 and
consists of deferred tax expense amounting TL (5,398,154).
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, 2023, amounts to TL 72,264,798.
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 for the year ended period
l.1.
between January 1, 2023 – December 31, 2023.
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 commissions received from
l.3.
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
81,759
20,191
101,950
30,347
8,029
38,376
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 10,567,141 and the balance of extraordinary reserves is TL
100,220,034.
Detail of the securities increase fund is explained in Section Five Note II-m.9 and TL (832,786) of this amount is the deferred tax effect on financial assets at fair value through
other comprehensive income (31 December 2022: TL (8,345,080)).
The exchange difference amounting to TL 1,121,189 arising from net investment hedging accounting, the details of which are included in the Third Part II-2 footnote, has been
accounted for under the item “Accumulated Other Comprehensive Income or Expenses Reclassified in Profit or Loss”,
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Türkiye İş Bankası A.Ş.
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
VI. DISCLOSURES AND FOOTNOTES ON STATEMENT OF CASH FLOWS
VI. DISCLOSURES AND FOOTNOTES ON THE BANK’S RISK GROUP
The operating profit to TL 32,546,281 before the changes in operating assets and liabilities mostly comprised of TL 182,278,174 of interest received from loans and securities,
and TL 131,447,615 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 (26,594,976) (December 31, 2022: TL (25,604,457)).
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 114,524,035 (December 31, 2022: TL 18,620,820 increase).
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:
Net Cash Provided from Other Investing Activities account includes net cash flows from sale of intangible assets and declined by TL 4,129,309 (December 31, 2022: TL
2,515,348 decrease).
Bank’s Risk Group
The effect of changes in foreign exchange rates on cash and cash equivalents is TL 5,094,705 as of December 31, 2023 (December 31, 2022: TL (967,080)). 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.
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
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.
Balance at the beginning of the period
13,925,479
17,111,566
Balance at the end of the period
30,091,136
28,515,121
Interest and commission income received
2,370,259
14,670
7,328,993
9,751,588
1,415,698
1,309,862
2,191,346
23,632
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
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, 2021
December 31, 2020
79,630,416
15,722,553
63,907,863
14,983,586
14,983,586
96,225,661
14,810,443
81,415,218
18,668,788
18,668,788
325,002,285
30,724,839
294,277,446
34,862,415
34,862,415
79,630,416
15,722,553
63,907,863
14,983,586
14,983,586
359,864,700
94,614,002
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:
94,614,002
114,894,449
Interest and commission income received
1,249,418
11,388
December 31, 2022
December 31, 2021
Bank’s Risk Group
Prior Period:
Loans
Bank’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
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
4,452,442
7,328,993
569,202
608,277
1,309,862
13,400
Investments in Associates,
Subsidiaries and Jointly
Controlled Entities (Joint
Ventures)
Direct and Indirect Shareholders
of the Bank
Other Individuals and Corporates
in Risk Group
Deposits
Current Period
Prior Period
Current Period
Prior Period
Current Period
Prior Period
Balance at the beginning of the period
16,910,042
12,421,537
Balance at the end of the period
31,663,727
16,910,042
Interest expense on deposits
2,958,186
629,948
130,226
1,700,282
404,204
302,826
130,226
58,439
8,771,749
7,193,861
1,071,975
2,053,129
8,771,749
160,522
a.3. Information on forward and option agreements and other similar agreements made with the Bank’s risk group:
Bank’s Risk Group
Investments in Associates,
Subsidiaries and Jointly
Controlled Entities (Joint
Ventures)
Direct and Indirect Shareholders
of the Bank
Other Individuals and Corporates
in Risk Group
Current Period
Prior Period
Current Period
Prior Period
Current Period
Prior Period
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
15,007,188
1,966,285
6,952,556
15,007,188
274,803
(21,221)
2,474,171
310,289
(48,227)
4,033
2,474,171
1,226
304
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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, 2023
Notes To The Unconsolidated Financial Statements For The Year Ended
December 31, 2023
b. Disclosures for Bank’s risk group:
b.1. The relation of the Bank with corporations in its risk group and under its control regardless of whether there are any transactions between the parties.
All types of corporate and retail banking services are provided to these corporations in line with the articles of Banking Law.
b.3. 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 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 cash loans is 3.47%, while the ratio (excluding
NPL) to the overall assets is 1.62%; the ratio of deposits of the risk group corporations to the overall deposits is 2.44%, while the ratio to overall liabilities is 1.65%, 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. In addition, the Bank, through its branches and distribution channels, conducts Intermediary activities for
the Transmission of Orders in favor of Iş Yatırım Menkul Değerler A,Ş. Furthermore, through its branches, The Bank’s Private Banking and Commercial and Corporate Banking
branches are the agency 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.
In the current period, a real estate owned by the Bank has been purchased by İş Gayrimenkul Yatırım Ortaklığı.
b.4. As of December 31, 2023, 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 within the scope of the relevant Board of Directors decisions is TL 11,047 (December 31, 2022: TL
498,959).
c. Total salaries and similar benefits paid to the (executive members and senior executives)
In the current period, the gross total of payment provided to the key management amounts is TL 176,108 (December 31, 2022: TL 86,081).
VIII. DISCLOSURES ON THE BANK’S DOMESTIC, FOREIGN, OFF-SHORE BRANCHES OR ASSOCIATES AND FOREIGN REPRESENTATIVE OFFICES
SECTION SIX: OTHER EXPLANATIONS
I.
EXPLANATIONS ON THE BANK’S CREDIT RATINGS:
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
Rating
Outlook (*)
B3
B3
B3
NP
NP
B-
B
B
B
A+ (tur)
b
Positive
Positive
Positive
-
-
Negative
Negative
-
-
Negative
-
The dates when the Bank’s credit ratings/outlooks were last updated are given below:
Moody’s: 17.01.2024, Fitch Ratings: 22.09.2023
(*) 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.
Total Assets
Legal Capital
I.
EXPLANATIONS ON THE AUDITORS’ INDEPENDENT AUDIT REPORT:
SECTION SEVEN: EXPLANATIONS ON THE AUDITORS’ INDEPENDENT AUDIT REPORT
90,022,049
59,129,476
14,377,299
4,574,098
19,109,630
3,750
80,000
1,395,743
325,698
The unconsolidated financial statements and disclosures for the period ended December 31, 2023, 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 13, 2024, is presented preceding the
unconsolidated financial statements.
II.
EXPLANATIONS AND FOOTNOTES OF THE INDEPENDENT AUDITORS REPORT
There are no significant issues or necessary disclosures or notes in relation to the Bank’s operations other than those mentioned above.
Domestic Branches (*)
1,066
20,809
Number
Employees
Country of Incorporation
Foreign Representative Offices
Foreign Branches
1
1
2
15
2
2
1
3
2
53
214
45
35
6
China
Egypt
England
T.R.N.C.
Iraq
Kosovo
Bahrain
Off-Shore Branches
(*) The Branches located in Free Trade Zones in Turkey are included among domestic branches.
IX. SUBSEQUENT EVENTS
Within the scope of the decision of the Board of Directors regarding the issue of debt instrument on 23.08.2023, the Bank issued a financial bond with a nominal value of TL
1,459,387 after December 31, 2023.
Within the scope of the decisions of the Bank’s Board of Directors dated 23.11.2022, 14.06.2023 and 20.11.2023 for the issuance of debt instruments abroad, financing bonds
and bonds with nominal values of USD 285 million and EUR 10 million were issued abroad after the date of 31.12.2023.
It was decided to increase the Bank’s paid-in capital from TL 10,000,000 to TL 25,000,000 by covering all of it from internal sources (extraordinary reserves), accordingly, the
approval of the BRSA regarding the capital increase was received on 11.01.2024 and the transfer of internal resources to the capital account was carried out, the process of
applying to the Capital Markets Board (CMB) on 15.01.2024 is ongoing, the issuance of new shares and the necessary registration procedures after the approval of the CMB it
will be performed.
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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, 2023, 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, 2023 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.4.4., IV.e and IV.f the accompanying consolidated financial statements as at December 31, 2023, include a free
provision at an amount of TL 10,000,000 thousands of which TL 8,475,000 thousands was provided in prior years, and TL 2,000,000 thousands
and TL 3,525,000 thousands were reversed and provided, respectively 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”) and the International Auditing and Accounting Standards Board
(IAASB). 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 International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants (IESBA Code) and have fulfilled our other
responsibilities in accordance with the code of ethics and the IESBA Code. 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, 2023
With Independent Auditor’s Report Thereon
(Convenience Translation of Consolidated Financial Statements
and Related Disclosures and Footnotes Originally Issued in Turkish)
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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 Group 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 Group 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 another entity who is in the same audit network
within 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 Group's provision
provided for the deficit and also disclosures on key assumptions related to
pension fund deficit.
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.
Employees of the Parent Bank 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, the Parent
Bank 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 2023 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”.
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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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 Group 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.
Güney Bağımsız Denetim ve Serbest Muhasebeci Mali Müşavirlik Anonim Şirketi
A member firm of Ernst & Young Global Limited
Fatma Ebru Yücel, SMMM
Partner
February 13, 2023
İstanbul, Türkiye
312
Consolidated Financial Report As At And Fot The Year Ended
December 31, 2023
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 IŞBANK GEORGIA (JSC ISBANK GEORGIA)
LEVENT VARLIK KİRALAMA A.Ş.
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 ENTİTİES
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 audit and presented as the attached.
Sadrettin Yurtsever
Member of the Board and
the Audit Committee
Güzide Meltem Kökden
Deputy Chairperson of the Board
of Directors and Chairperson of the
Audit Committee
Ali Tolga Ünal
Head of Financial Management
Division
İzlem Erdem
Deputy Chief Executive
In Charge of Financial Reporting
The authorized contact person for questions on this consolidated financial report:
Name – Surname/Title: Nilgün Yosef Osman/Head of Investor Relations and Sustainability Division
Phone No: +90 212 316 16 02
Fax No:
+90 212 316 08 40
E-Mail:
Nilgun.Osman@isbank.com.tr
investorrelations@isbank.com.tr
Website: www.isbank.com.tr
Adnan Bali
Chairperson of the Board of
Directors
Hakan Aran
Chief Executive Officer
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SECTION I
General Information about the Parent Bank
I.
II.
III.
IV.
V.
VI.
Explanations on the Establishment Date and Initial Status of the Parent Bank, and 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 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
VIII. Written Policies on Assessment of Ensuring Compliance on Market Discipline, Disclosure Obligations, Frequency and Accuracy of the Related Disclosures
SECTION II
Consolidated Financial Statements
I.
II.
III.
IV.
V.
VI.
VII.
Consolidated Balance Sheet – Assets
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
VIII.
Consolidated Statement of Profit Appropriation
SECTION III
Explanations on Accounting Policies
I.
II.
III.
IV.
V.
VI.
VII.
Basis of Presentation
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
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
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
314
318
318
318
319
319
319
321
321
322
323
324
325
328
328
330
331
332
332
333
334
335
335
335
336
337
337
337
338
338
338
338
339
339
339
340
340
341
343
343
343
343
343
343
SECTION IV
Information on the Financial Position and Risk Management of the Group
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 Consolidated Liquidity Coverage Ratio
Explanations on Leverage Ratio
VIII.
Explanations on Other Price Risks
IX.
X.
XI.
Explanations on The Presentation of Financial Assets and Liabilities at Fair Value
Explanations on Transactions Made on Behalf of Others and Transactions Based on Fiduciary
Explanations on Risk Management
XII.
Explanations on Segment Reporting
SECTION V
Disclosures and Footnotes on the Consolidated Financial Statements
I.
II.
III.
IV.
V.
VI.
VII.
VIII.
IX.
Disclosures and Footnotes on Consolidated Assets
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.
II.
Explanations on the Independent Auditors’ Report
Explanations and Footnotes of the Independent Auditors Report
344
351
360
362
366
367
372
373
373
375
375
391
392
406
415
417
421
422
423
424
426
426
427
427
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Türkiye İş Bankası A.Ş.
Consolidated Financial Statements For The Year Ended December 31, 2023
Consolidated Financial Statements For The Year Ended December 31, 2023
SECTION ONE: GENERAL INFORMATION ABOUT THE PARENT BANK
Chief Executive Officer and Deputy Chief Executives:
I.
Explanations on the Establishment Date and Initial Status of the Parent Bank, and History Including the Changes in the Former Status
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, 2023, 38.20% 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 33.71% are on free float (December 31, 2022: Fund 37.31%, CHP 28.09%, Free float 34.60%).
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
Güzide Meltem Kökden
Hakan Aran
Sadrettin Yurtsever
Fazlı Bulut
Durmuş Öztek
Şebnem Aydın
Recep Hakan Özyıldız
Mustafa Rıdvan Selçuk
Ahmet Gökhan Sungur
Gökhan Şen
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, Chairperson of the Corporate Governance Committee, Member of the Audit Committee, Remuneration
Committee, TRNC Internal Systems Committee, Sustainability Committee Risk Committee, Member of the
Operational Risk Committee Corporate Social Responsibility Committee, and the Member of the Board of
Directors Operating Principles Committee
Director, Member of Corporate Social Responsibility Committee, Corporate Governance 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, Member of Corporate Governance Committee, Corporate Social Responsibility Committee, Credit
Committee and Sustainability Committee
Director
Director
Director
Director
Name and Surname
Areas of Responsibility
Hakan Aran
Nevzat Burak Seyrek
Ebru Özsuca
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
I. Deputy General Manager, Affiliates Corporate Architecture, Strategy and Corporate Performance Management,
Information Systems Strategy Committee, Operational Risk Committee and Sustainability Committee Member
Treasury, Economic Research, Capital Markets, Member of the Risk Committee
Corporate and Commercial Banking Marketing, Commercial Banking Sales, Cross-Border Banking, Free Zone
Branches, Member of the Sustainability Committee
SME and Business Banking Marketing, and Sales and , Agricultural Banking Marketing, Commercial Banking
Product, Member of the Corporate Social Responsibility Committee and Sustainability Committee
Information Technologies, Data Management, Acquisition, Artificial Intelligence, Member of Operational Risk
Committee, Sustainability Committee, and Information Technologies Strategic Committee
Retail Banking Marketing, Sales and Product, Personal Loans, Digital Banking, Customer Relations, Payment
Systems Ecosystem, Payment Systems Operations, Payment Systems Product, Member of Operational Risk
Committee, and Member of the Sustainability Committee
Retail, Commercial and Corporate Loans Allocation, Credit Portfolio Management, Project Finance, Member of the
Corporate Social Responsibility Committee, Member of the Risk Committee and Sustainability Committee
Internal Control, Corporate Compliance, Natural Member of the Risk Committee, Information Technologies
Strategic Committee, Member of the Operational Risk Committee and Sustainability Committee
Financial Management, Economic Research, Financial Law and Tax Management Consultancy, Investor Relations
and Sustainability, Management Reporting and Internal Accounting, Member of Risk Committee, Information
Systems Strategy Committee and Sustainability Committee
General Secretariat, Corporate Communications, Private Banking Marketing and Sales, Corporate Social
Responsibility Committee and Member of the Sustainability Committee
Legal Affairs and Follow-Up, Legal Counsellorship, Loans Monitoring, Retail, Commercial and Corporate Loans
and Retail Loans Proceedings
Banking Operations and Payment Operations, Support Services, External Operations and Commercial Loan
Operations, Construction and Real Estate Management, Member of Operational Risk and sustainability
Committee, Human Resources Management, Talent Management, Consumer Relations Coordination Officer,
Mrs. Gamze Yalcin and Mr. H. Cahit Çınar has left their duties at the Bank.
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
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)
3,820,190
38.20%
3,820,190
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.
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Türkiye İş Bankası A.Ş.
Consolidated Financial Statements For The Year Ended December 31, 2023
Consolidated Financial Statements For The Year Ended December 31, 2023
The Parent Bank and its 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
JSC İŞBANK
JSC ISBANK GEORGIA
LEVENT VARLIK KİRALAMA A.Ş.
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.
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, payment services, 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.
Levent Varlık Kiralama A.Ş.
The purpose of the Company, which is founded in November, 2023, is to issue lease certificates exclusively within the framework of the Capital Market Law and related
legislation provisions.
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.
Moka Ödeme ve Elektronik Para Kuruluşu 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 established in 1925 and operates in almost all non-life insurance service. The Company’s shares are traded in the Borsa İstanbul A.Ş.
TSKB Gayrimenkul Yatırım Ortaklığı A.Ş.
Anadolu Hayat Emeklilik A.Ş.
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.
Efes Varlık Yönetim 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.
Türkiye Sınai Kalkınma Bankası A.Ş.
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.
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.
Yatırım Finansman Menkul Değerler A.Ş.
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 Faktoring A.Ş.
The Company, which operates in the factoring sector since 1993, is engaged in domestic and foreign factoring operations.
İş Finansal 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.
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.
Yatırım Varlık Kiralama 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 provisions.
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
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.
318
319
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Consolidated Balancesheet (Statement Of Financial Position)
Consolidated Balancesheet (Statement Of Financial Position)
ASSETS
Footnotes
CURRENTPERIOD (31/12/2023)
FC
Total
TL
PRIOR PERIOD (31/12/2022)
FC
Total
TL
THOUSAND TL
FINANCIAL ASSETS (Net)
Cash and Cash Equivalents
Cash and Balances with Central Bank
Banks
Money Market Placements
Expected Credit Loss (-)
Financial Assets at Fair Value Through Profit
or Loss
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
V-I-a
V-I-ç
390,336,844
591,744,745
982,081,589
191,469,562
310,657,416
502,126,978
192,369,378
427,090,304
619,459,682
35,067,358
211,798,542
246,865,900
165,825,618
360,809,028
526,634,646
21,718,599
180,127,300
201,845,899
18,731,062
66,536,675
85,267,737
7,187,687
31,807,128
38,994,815
7,939,685
126,987
0
7,939,685
6,195,342
0
6,195,342
255,399
382,386
34,270
135,886
170,156
V-I-b
24,018,754
20,477,288
44,496,042
23,469,599
10,105,253
33,574,852
372,461
19,192,296
19,564,757
711,666
9,566,112
10,277,778
3,551,151
20,095,142
658,024
626,968
4,209,175
11,873,519
334,381
12,207,900
20,722,110
10,884,414
204,760
11,089,174
V-I-d
173,412,009
123,613,217
297,025,226
132,318,883
69,806,694
202,125,577
170,689,290
116,832,858
287,522,148
129,555,447
64,099,567
193,655,014
505,358
2,217,361
2,598,836
3,104,194
258,517
1,342,084
1,600,601
4,181,523
6,398,884
2,504,919
4,365,043
6,869,962
Derivative Financial Assets
V-I-c-i
536,703
20,563,936
21,100,639
613,722
18,946,927
19,560,649
Derivative Financial Assets at Fair Value Through
Profit or Loss
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 (-)
536,703
20,563,936
21,100,639
613,722
18,946,927
19,560,649
0
0
0
0
0
0
958,404,269
590,776,237
1,549,180,506
586,224,751
393,104,327
979,329,078
V-I-e
V-I-e-ı
V-I-e
V-I-f
777,452,231
556,841,298 1,334,293,529
502,248,199
375,845,283
878,093,482
6,843,234
17,883,403
24,726,637
4,961,490
13,400,104
18,361,594
19,150,379
3,341,707
22,492,086
13,696,739
2,211,918
15,908,657
184,774,042
31,404,006
216,178,048
91,311,985
15,644,176
106,956,161
184,190,708
15,316,159
199,506,867
90,427,061
9,829,112
100,256,173
583,334
16,087,847
16,671,181
884,924
5,815,064
6,699,988
29,815,617
18,694,177
48,509,794
25,993,662
13,997,154
39,990,816
ASSETS HELD FOR SALE AND DISCONTINUED
OPERATIONS (Net)
V-I-n
1,545,205
17,749
1,562,954
1,598,635
20,359
1,618,994
Held for Sale
Discontinued Operations
EQUITY INVESMENTS
Investments in Associates (Net)
V-I-g
Associates Accounted by Using Equity Method
4.1.2
Unconsolidated Associates
1,545,205
17,749
1,562,954
1,598,635
20,359
1,618,994
0
0
0
0
0
0
81,035,427
311,107
81,346,534
42,680,123
190,321
42,870,444
569,486
453,026
116,460
0
0
0
569,486
453,026
116,460
405,345
385,225
20,120
0
0
0
405,345
385,225
20,120
Subsidiaries (Net)
V-I-ğ
80,430,190
311,107
80,741,297
42,258,868
190,321
42,449,189
Unconsolidated Financial Subsidiaries
Unconsolidated Non-Financial Subsidiaries
Joint Ventures (Net)
Joint Ventures Accounted by Using Equity Method
4.3.2 Unconsolidated Joint Ventures
TANGIBLE ASSETS (Net)
INTANGIBLE ASSETS (Net)
Goodwill
Other
V-I-h
V-I-j
V-I-k
0
0
0
0
0
0
80,430,190
311,107
80,741,297
42,258,868
190,321
42,449,189
35,751
0
35,751
0
0
0
35,751
0
35,751
15,910
0
15,910
0
0
0
15,910
0
15,910
44,255,046
540,492
44,795,538
24,107,773
370,345
24,478,118
6,877,527
260,714
7,138,241
3,880,370
199,443
4,079,813
27,994
0
27,994
27,994
0
27,994
6,849,533
260,714
7,110,247
3,852,376
199,443
4,051,819
INVESTMENT PROPERTY (Net)
V-I-l
18,056,230
0
18,056,230
11,320,190
0
11,320,190
CURRENT TAX ASSET
DEFERRED TAX ASSET
OTHER ASSETS (Net)
TOTAL ASSETS
V-I-m
V-I-o
39,440
10,895
50,335
16,486
14,637,453
0
14,637,453
963,685
9,868
10,425
26,354
974,110
223,161,320
32,731,871
255,893,191
132,660,097
15,947,393
148,607,490
1,738,348,761
1,216,393,810
2,954,742,571
994,921,672
720,509,897 1,715,431,569
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
4.2
4.2.1
4.2.2
4.3
4.3.1
V.
VI.
6.1
6.2
VII.
VIII.
IX.
X.
320
LIABILITIES
Footnotes
CURRENTPERIOD (31/12/2023)
PRIOR PERIOD (31/12/2022)
THOUSAND TL
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
DEPOSITS
FUNDS BORROWED
MONEY MARKETS
SECURITIES ISSUED (Net)
Bills
Asset Backed Securities
Bonds
FUNDS
Borrower Funds
Other
FINANCIAL 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 (Net)
Held for Sale
Discontinued Opperations
SUBORDINATED DEBT
Loans
Other Debt Instruments
OTHER LIABILITIES
SHAREHOLDERS’ EQUITY
Paid-in Capital
Capital Reserves
XV.
XVI.
16.1
16.2
16.2.1 Share Premium
16.2.2 Share Cancellation Profits
16.2.3 Other Capital Reserves
16.3
16.4
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
16.5
16.5.1 Legal Reserves
16.5.2 Status Reserves
16.5.3 Extraordinary Reserves
16.5.4 Other Profit Reserves
Profit or Loss
16.6
16.6.1 Prior Periods’ Profit or Loss
16.6.2 Current Period Profit or Loss
V-II-a
V-II-c
V-II-ç
TL
FC
Total
875,970,187
10,088,579
85,108,713
10,315,459
6,165,382
1,508,031
2,642,046
132,820
132,820
0
0
834,081,633 1,710,051,820
241,240,593
231,152,014
137,713,038
52,604,325
109,143,567
98,828,108
6,900,696
735,314
1,508,031
0
100,734,840
98,092,794
1,349,660
1,349,660
0
1,482,480
1,482,480
0
0
0
TL
381,017,089
12,101,494
37,777,875
11,523,746
10,463,791
164,426
895,529
27,907
27,907
0
0
FC
571,618,843
143,880,105
13,462,281
46,820,814
0
0
46,820,814
709,826
709,826
0
0
Total
952,635,932
155,981,599
51,240,156
58,344,560
10,463,791
164,426
47,716,343
737,733
737,733
0
0
V-II-b-g
602,277
7,762,079
8,364,356
3,060,665
7,030,436
10,091,101
602,277
7,762,079
8,364,356
3,060,665
7,030,436
10,091,101
0
0
0
0
0
0
V-II-f
V-II-ğ
V-II-h
V-II-h
V-II-ı
V-II-i
V-II-e
V-II-j
0
1,835,905
80,916,682
0
6,162,265
42,121,605
32,632,812
13,264,627
71,374
0
0
0
2,324,411
0
2,324,411
242,325,905
301,694,287
10,000,000
1,269,954
138,553
0
1,131,401
0
461,609
26,716,635
0
12,347
23,658,483
3,045,805
464,721
42,819
0
0
0
0
2,297,514
107,633,317
0
6,174,612
65,780,088
35,678,617
13,729,348
114,193
0
0
0
37,546,571
0
37,546,571
37,418,618
1,662,553
0
0
0
0
0
39,870,982
0
39,870,982
279,744,523
303,356,840
10,000,000
1,269,954
138,553
0
1,131,401
0
1,326,947
54,155,322
0
5,886,941
23,985,529
24,282,852
8,077,499
1,599,383
0
0
0
2,277,824
0
2,277,824
143,167,968
213,719,591
10,000,000
1,218,092
138,551
0
1,079,541
0
316,106
13,137,153
0
6,798
11,602,637
1,527,718
48,488
0
0
0
0
0
1,643,053
67,292,475
0
5,893,739
35,588,166
25,810,570
8,125,987
1,599,383
0
0
0
31,280,921
0
31,280,921
20,960,184
(3,666,898)
0
0
0
0
0
33,558,745
0
33,558,745
164,128,152
210,052,693
10,000,000
1,218,092
138,551
0
1,079,541
45,527,841
717
45,528,558
20,231,121
(429)
20,230,692
29,367,334
(1,454,175)
27,913,159
44,402,975
(4,867,474)
39,535,501
109,918,245
11,735,223
403,399
97,779,623
0
70,737,833
(8,463)
70,746,296
941,934
62,094
0
879,840
0
1,887,486
380,009
1,507,477
110,860,179
11,797,317
403,399
98,659,463
0
72,625,319
371,546
58,255,995
7,063,017
289,294
50,903,684
0
60,681,842
(10,877)
539,625
28,268
0
511,357
0
789,181
(116,770)
58,795,620
7,091,285
289,294
51,415,041
0
61,471,023
(127,647)
72,253,773
60,692,719
905,951
61,598,670
16.7 Minority Shares
V-II-k
34,873,080
286,591
35,159,671
18,929,566
(127,801)
18,801,765
TOTAL LIABILITIES AND SHAREHOLDERS’
EQUITY
1,624,651,226 1,330,091,345 2,954,742,571
869,833,310
845,598,259 1,715,431,569
321
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Consolidated Statement Of Off-Balance Sheet Items
Consolidated Statement Of Off-Balance Sheet Items
OFF-BALANCE SHEET ITEMS
Footnotes
THOUSAND TL
CURRENT PERIOD
(31/12/2023)
PRIOR PERIOD
(31/12/2022)
Footnotes
CURRENT PERIOD
(31/12/2023)
PRIOR PERIOD
(31/12/2022)
THOUSAND TL
TL
FC
Total
TL
FC
Total
TL
FC
Total
TL
FC
Total
OFF-BALANCE SHEET CONTINGENCIES and
COMMITMENTS (I+II+III)
982,736,242
1,524,431,477
2,507,167,719 486,977,283
950,378,400 1,437,355,683
GUARANTEES AND SURETYSHIPS
V-III
168,764,667
262,730,679
431,495,346
91,557,242
158,958,679
250,515,921
159,064,124
160,736,332
319,800,456
85,483,077
95,269,548
180,752,625
3.2
3.2.1
Derivative Financial Instruments Held for
Trading
Forward Foreign Currency Buy/Sell
Transactions
240,611,735
1,151,400,839
1,392,012,574
197,683,375
724,364,281
922,047,656
45,086,612
150,221,875
195,308,487
10,640,362
58,699,042
69,339,404
1,508,058
1,770,160
3,278,218
1,344,063
1,143,615
2,487,678
3.2.1.1
Forward Foreign Currency Buy Transactions
32,446,782
65,946,872
98,393,654
9,117,920
25,804,206
34,922,126
16,505,345
63,545,208
80,050,553
11,143,447
40,340,109
51,483,556
3.2.1.2
Forward Foreign Currency Sell Transactions
12,639,830
84,275,003
96,914,833
1,522,442
32,894,836
34,417,278
141,050,721
95,420,964
236,471,685
72,995,567
53,785,824
126,781,391
3.2.2
Currency and Interest Rate Swaps
163,259,055
844,538,982
1,007,798,037
172,439,374
579,101,581
751,540,955
A.
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
Letters of Guarantee
Guarantees Subject to State Tender Law
Guarantees Given for Foreign Trade Operations
Other Letters of Guarantee
Bank Acceptance
Import Letter of Acceptances
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
9,435,050
4,960,260
14,395,310
5,576,890
2,476,617
8,053,507
0
2,834,392
2,834,392
0
704,717
704,717
9,435,050
2,125,868
11,560,918
5,576,890
1,771,900
7,348,790
261,037
90,802,490
91,063,527
492,132
56,376,383
56,868,515
245,881
58,717,904
58,963,785
455,314
36,316,518
36,771,832
15,156
32,084,586
32,099,742
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
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
4,456
6,231,597
6,236,053
0
0
0
5,143
0
4,836,131
4,841,274
0
0
573,359,840
71,511,904
644,871,744
197,736,666
40,558,403
238,295,069
569,766,880
57,695,865
627,462,745
194,762,484
22,659,219
217,421,703
2,775,678
26,011,453
28,787,131
55,113
4,658,659
4,713,772
0
0
0
0
0
0
0
168,814
168,814
1,000,000
138,750
1,138,750
118,244,588
4,022,975
122,267,563
65,197,193
2,105,370
67,302,563
0
0
9,204,813
22,019
417,894,567
1,085,145
0
0
0
0
0
0
0
0
0
0
0
0
0
0
9,204,813
5,447,537
22,019
22,490
417,894,567
112,111,363
1,085,145
277,375
0
0
0
0
0
0
0
0
0
0
0
0
0
0
5,447,537
22,490
112,111,363
277,375
0
0
2.1.13 Other Irrevocable Commitments
20,540,070
27,492,623
48,032,693
10,651,413
15,756,440
26,407,853
Revocable Commitments
Revocable Loan Granting Commitments
Other Revocable Commitments
DERIVATIVE FINANCIAL INSTRUMENTS
Derivative Financial Instruments Held for Risk
Management
Fair Value Hedges
Cash Flow Hedges
Net Foreign Investment Hedges
3,592,960
13,816,039
17,408,999
2,974,182
17,899,184
20,873,366
3,592,960
13,816,039
17,408,999
2,939,182
17,899,184
20,838,366
0
0
0
35,000
0
35,000
240,611,735
1,190,188,894
1,430,800,629
197,683,375
750,861,318
948,544,693
0
0
0
0
38,788,055
38,788,055
38,788,055
38,788,055
0
0
0
0
0
0
0
0
26,497,037
26,497,037
26,497,037
26,497,037
0
0
0
0
2.2
2.2.1
2.2.2
III.
3.1
3.1.1
3.1.2
3.1.3
322
3.2.2.1 Currency Swap Buy Transactions
3.2.2.2 Currency Swap Sell Transactions
3.2.2.3 Interest Rate Swap Buy Transactions
3.2.2.4 Interest Rate Swap Sell Transactions
101,944
240,148,199
240,250,143
14,912,056
201,323,125
216,235,181
154,243,873
124,389,343
278,633,216
155,910,430
85,151,884
241,062,314
4,456,619
240,000,720
244,457,339
808,444
146,313,286
147,121,730
4,456,619
240,000,720
244,457,339
808,444
146,313,286
147,121,730
3.2.3
Currency, Interest Rate and Security Options
30,161,708
83,635,857
113,797,565
6,223,543
23,979,673
30,203,216
3.2.3.1 Currency Call Options
3.2.3.2 Currency Put Options
3.2.3.3 Interest Rate Call Options
3.2.3.4 Interest Rate Put Options
3.2.3.5 Securities Call Options
3.2.3.6 Securities Put Options
3.2.4
Currency Futures
3.2.4.1 Currency Buy Futures
3.2.4.2 Currency Sell Futures
3.2.5
Interest Rate Futures
3.2.5.1
Interest Rate Buy Futures
3.2.5.2 Interest Rate Sell Futures
3.2.6
Other
CUSTODY AND PLEDGES RECEIVED
(IV+V+VI)
ITEMS HELD IN CUSTODY
Customers’ Securities Held
Investment Securities Held in Custody
Cheques Received for Collection
19,595,726
31,548,029
51,143,755
3,160,239
8,188,384
11,348,623
9,931,673
40,569,812
50,501,485
2,560,163
8,138,756
10,698,919
161,125
473,184
1,801,256
1,739,302
0
0
5,759,008
5,759,008
5,759,008
5,759,008
0
0
161,125
473,184
627,609
2,366,911
61,954
1,687,553
1,749,507
0
0
0
0
0
0
0
0
0
0
0
102,031
401,110
531,608
937,189
0
0
0
3,822,162
3,822,162
8,209
0
2,388,511
1,878,869
509,642
0
0
0
3,822,162
3,822,162
110,240
401,110
3,857,308
2,410,477
1,446,831
0
0
0
2,315,162
4,116,418
1,468,797
303,104
70,688,963
70,992,067
6,911,299
60,195,474
67,106,773
2,101,117,035
4,450,415,695
6,551,532,730
1,321,757,181
2,507,090,956
3,828,848,137
168,718,304
258,845,119
427,563,423
126,082,554
177,367,218
303,449,772
0
0
0
0
0
0
89,804,295
10,527,854
100,332,149
73,694,920
9,302,513
82,997,433
71,751,500
122,441,796
194,193,296
46,921,949
93,195,648
140,117,597
Commercial Notes Received for Collection
4,991,481
59,891,659
64,883,140
3,969,225
36,196,124
40,165,349
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
2,171,028
65,983,810
68,154,838
1,496,460
38,672,933
40,169,393
0
0
0
0
0
0
1,932,398,731
4,191,570,576
6,123,969,307
1,195,674,627
2,329,723,738
3,525,398,365
90,629,125
377,511,569
468,140,694
70,796,111
214,601,746
285,397,857
28,760,470
101,929,480
130,689,950
22,783,627
73,150,399
95,934,026
372,589,614
538,762,101
911,351,715
261,292,144
230,129,478
491,421,622
0
0
0
0
0
0
925,688,136
2,060,964,425
2,986,652,561
612,933,020
1,140,910,774
1,753,843,794
514,731,386
1,112,403,001
1,627,134,387
227,869,725
670,931,341
898,801,066
0
0
0
0
0
0
0
0
0
0
0
0
3,083,853,277
5,974,847,172 9,058,700,449 1,808,734,464
3,457,469,356
5,266,203,820
323
B.
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.
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Türkiye İş Bankası A.Ş.
Consolidated Statement Of Profit or Loss
Türkiye İş Bankası A.Ş.
Consolidated Statement Of 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.
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
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 QUITY 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 (XVII±XVIII)
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 (*)
(*) Expressed in exact TL.
324
Footnote
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
THOUSAND TL
CURRENT PERIOD
(01/01-31/12/2023)
PRIOR PERIOD
(01/01-31/12/2022)
257,253,164
164,230,889
774,911
3,771,730
2,347,134
78,317,720
475,254
45,774,148
32,068,318
3,029,117
4,781,663
168,229,605
121,340,486
14,506,563
11,181,957
10,339,531
398,684
10,462,384
89,023,559
40,133,066
56,642,029
3,880,249
52,761,780
16,508,963
143,376
16,365,587
421,522
40,744,739
17,928,872
-936,083
23,751,950
64,136,738
234,459,624
19,759,355
4,630,217
30,644,805
93,011,616
86,413,631
0
13,434,857
0
99,848,488
13,478,534
20,258,987
7,439,918
14,220,371
86,369,954
0
0
0
0
0
0
0
0
0
0
0
0
0
0
86,369,954
72,253,773
14,116,181
0.289012491
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
THOUSAND TL
CURRENT PERIOD
(01/01-31/12/2023)
PRIOR PERIOD
(01/01-31/12/2022)
PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
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
86,369,954
16,285,846
27,358,460
19,312,374
0
11,018
Other Income/ Expense Items of Other Comprehensive Income not to be Reclassified to Profit Or Loss
8,385,793
Taxes Relating To Components Of Other Comprehensive Income not to be Reclassified To Profit Or Loss
(350,725)
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
(11,072,614)
6,527,303
(28,885,874)
0
(1,121,189)
Other Income/ Expense Items of Other Comprehensive Income to be Reclassified to Other Profit or Loss
4,723,021
Taxes Relating To Components Of Other Comprehensive Income to be Reclassified To Profit Or Loss
7,684,125
TOTAL COMPREHENSIVE INCOME (I+II)
102,655,800
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
325
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report 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
Footnotes
Paid-in
Capital
Share
Premium
Share
Certificate
Cancellation
Profits
Other
Capital
Reserves
Accumulated Other Comprehensive Income
That
will not be Reclassified in Profit / (Loss)
Tangible
assets
accumulated
revaluation
reserve
Increase
/ (Decrease)
Accumulated
gains/(losses)
on
remeasurements
of
defined benefit
plans
Other (1)
Accumulated Other Comprehensive Income That will be
Reclassified in Profit/(Loss)
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 Except
Non-controlling
Interest
Non-
controlling
Interest
Total
Shareholder’ s
Equity
PRIOR PERIOD ( 31/12/2022)
V-V
I.
II.
Beginning Balance
Adjustment in accordance with TAS 8
2.1
The Effect of Adjustments
2.2 The Effect of Changes in Accounting Policies
III.
IV.
V.
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
VI. Capital Increase Through Internal Reserves
5,500,000
VII. Paid-in Capital inflation adjustment difference
VIII. Convertible Bonds
(5,500,000)
Subordinated Debt
Increase /(Decrease) Through Other Changes
(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
IX.
X.
XI.
Profit Distribution
11.1 Dividend Paid
11.2 Transfer to Resewes
11.3 Other
Ending Balance (III+IV+ +X+XI)
10,000,000 138,551
0 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
CURRENT PERIOD ( 31/12/2023)
Beginning Balance
Adjustment in accordance with TAS 8
I.
II.
2.1
The Effect of Adjustments
2.2 The Effect of Changes in Accounting Policies
III.
IV
V.
New Balance (I+II)
Total Comprehensive Income
Capital Increase in Cash
VI. Capital Increase Through Internal Reserves
VII. Paid-in -Capital inflation adjustment difference
VIII. Convertible Bonds
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
61,471,023
191,250,928
18,801,765
210,052,693
10,000,000 138,551
1,079,541
14,465,250
(2,834,186) 8,599,628
16,700,491
214,834 8,376,739
5,999,012
6,499,991
25,014,591
8,521,898
58,795,620
61,471,023
191,250,928
18,801,765
210,052,693
(22,055,900)
3,932,965
72,253,773
85,922,893
16,732,907
102,655,800
IX.
X.
XI.
Subordinated Debt
Increase/(Decrease) Through Other Changes
2
51,860
6,715
(913)
Profit Distribution
11.1 Dividend Paid
11.2 Transfer to Reserves
11.3 Other (**)
602
(119,882)
35,396
52,184,441
(61,134,873)
(26,220)
(33,199)
(59,419)
(8,950,432)
(341,802)
(9,292,234)
(8,964,030)
(8,964,030)
(346,380)
(9,310,410)
52,170,843
(52,170,843)
13,598
13,598
4,578
18,176
Ending Balance (III+IV+ +X+XI)
10,000,000 138,553
1,131,401
31,172,456
(2,620,265) 16,976,367
12,499,003
2,959,293
12,454,863
110,860,179
371,546
72,253,773
268,197,169
35,159,671
303,356,840
(1) Other Compæhensive 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’, die provisions allocated in the relevant period for the dividend to be distributed to the personel were added to distributable
profit figure. In the prior period the amount of dividends distributed to bank personnel to the main contract of the Parent Bank is also included.
326
327
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Consolidated Statement Of Chash Flows
Türkiye İş Bankası A.Ş.
Consolidated Statement Of Profit Distribut,on Table
Footnotes
CURRENT PERIOD
(01/01-31/12/2023)
PRIOR PERIOD
(01/01-31/12/2022)
THOUSAND TL
THOUSAND TL
CURRENT PERIOD
(01/01-31/12/2023)
PRIOR PERIOD
(01/01-31/12/2022)
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
V-VI
Changes in Operating Assets and Liabilities
Net (Increase) / Decrease in Financial Assets at Fair Value Through Profit
or Loss
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 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.
328
86,645,439
211,263,314
(143,037,374)
1,617,556
56,642,029
56,180,996
5,507,942
(58,075,682)
(21,023,710)
(22,429,632)
355,067,984
(3,554,663)
(51,891,917)
(323,756,757)
(65,666,161)
79,303,708
555,677,084
0
4,137,659
0
160,819,031
441,713,423
(171,340,162)
(9,252,857)
147,626
(3,738,511)
226,747
(136,128,560)
62,809,311
(121,861,350)
40,745,444
(4,288,012)
4,185,113
60,961,708
(43,184,062)
0
(12,402,571)
(1,189,962)
0
8,591,643
283,150,017
114,144,588
397,294,605
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
(77,786,425)
(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
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
1.1
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 Prefered 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 ( % )
77,082,501
4,817,703
9,929,002
286,855
(5,398,154)
72,264,798
0
0
0
72,264,798
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
0.2891
723
0
0
0
0
0
0
77,207,514
12,411,168
17,082,925
121,205
(4,792,962)
64,796,347
0
4,398,284
476,342
59,921,721
600,000
599,998
2
0
0
0
3,092,161
0
8,630,682
8,630,411
232
39
0
0
0
47,598,878
0
0
0
0
0
0
0
0
0
0
0
0.2461
615
0
0
0.0369
92.0
0.0780
780.32
(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 165,466 allocated for the profit share to be distributed to the personnel in 2022 and added to the profit distribution base of the same year, and TL
3,093,000 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/lncome.
(4) Expressed in exact TL.
329
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
SECTION THREE: EXPLANATION ON ACCOUNTING POLICIES
I.
Basis of Presentation
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.
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. With the announcement made on November
23 2023, POA stated that, entities that is applying TFRS on their financial statements for the annual reporting period ending on or after 31 December 2023 should be
presented by adjusting for the inflation effect in accordance with the relevant accounting principles in the TAS 29 standard, on the other hand, He explained that institutions or
organizations authorized to regulate and supervise may determine different transition dates in their own fields for the implementation of TMS 29 provisions. In accordance with
the BRSA’s decision dated December 12 2023 and numbered 10744, the financial statements of banks and financial leasing, factoring, financing, savings financing and asset
management companies dated 31 December 2023 will not be subject to the inflation adjustment required within the scope of TMS 29. and In accordance with the Decision
No. 10825 dated January 11 2024 , it was decided to switch to inflation accounting as of January 1, 2025. Accordingly, TMS 29 was not applied and no inflation adjustment
was made in the financial statements dated 31 December 2023.
TFRS 17 “Insurance Contracts” standard, published by the POA on 16.02.2019 to be implemented in accounting periods starting after 31.12.2022, determines the principles
regarding the financial statements, measurement, presentation and disclosure of insurance contracts within the scope of the standard. The purpose of TFRS 17 is to ensure
that businesses represent the contracts in question in a realistic manner. POA has decided to apply TFRS 17 in the consolidated and individual financial statements of
companies as of 01.01.2024. In this context, the relevant standard was not applied in the financial statements dated 31.12.2023.
Within the scope of the project to change the benchmark interest rates carried out by the International Accounting Standards Board (IASB), the “Benchmark Interest Rate
Reform - 2nd stage” which brings changes to various TAS/TFRS, effective as of January 1, 2021, was published in December 2020. As of June 30, 2023, the Secured
Overnight Financing Rate (SOFR) has started to be used in open transactions with variable interest rates indexed to USD LIBOR. The mentioned changes did not have a
significant impact on the Group’s financial statements as of December 31, 2023.
The accounting policies applied in the current period are in line with the prior period consolidated financial statements. The accounting policies and the valuation principles
used in the preparation of the consolidated financial statements are presented below in detail.
II.
1.
Strategy for Use of Financial Instruments and Foreign Currency Transactions
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, payment services, 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.
The Parent Bank has been applying net investment hedge accounting as of 01.11.2023 to the 397 million EURO portion of its net investment in its subsidiary Isbank AG,
headquartered in Germany and whose functional currency is Euro, in order to hedge against exchange rate risk. The part of the EURO demand deposit subject to hedge
accounting has been determined as a hedging instrument. Exchange rate changes in the portion of foreign currency demand deposits subject to hedge accounting are
recognized in equity under “Accumulated Other Comprehensive Income or Expense Reclassified to Profit or Loss”.
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 periods, 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.
330
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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.
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.
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.
2. Presentation of subsidiaries, associates and jointly controlled entities which are not credit or financial institutions in consolidated financial 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.
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.
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.
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.
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 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 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 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.
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 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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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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.
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:
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 1. 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:
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. In 2023, loss at default models
were updated in individual and commercial portfolios, and statistical models that estimate the loss at default parameter through decision trees differentiated according to
risk variables in the relevant portfolios began to be used in expected credit loss calculations. 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. 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 by models in terms of credit risk groups that are detailed in the Bank’s data resources and system facilities. The model used for LGD forecasting based on the
Bank’s historical collection data, statistical models are used to explain the LGD ratios formed in past periods, taking into account the direct cost items in the collection process,
using risk variables that differ for each credit risk group.
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 Parent 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.
On the other hand, the possible effects of the earthquake disaster that occurred on 06.02.2023 on the loan portfolio have been the subject of expected loan loss calculations
on the basis of loan classes, taking into account the current regulations and data on the subject.
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.
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 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.
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.
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.
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
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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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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”. 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 companies, are recorded under the shareholders’ equity in current period.
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.
Within the scope of the TFRS 16 standard, development costs related to leases that cannot be added to the cost of the right-of-use asset and are within the scope of
exceptions in the mentioned standard are amortized in equal amounts, taking into account the useful-life period. 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
XIV.
Investment Property
Estimated Economic Life (Year)
Depreciation Rate
50
2-50
2-25
% 2
% 2 - % 50
% 4 - % 50
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
Banks and companies within the scope of consolidation account for their leases within the scope of TFRS 16 “Leases” standard. For contracts within the scope of TFRS
16, right-of-use assets and lease liabilities are reflected in the financial statements, and these are shown under “Tangible Assets” and “Leasing Transactions Liabilities”,
respectively.
In accordance with TFRS 16, the right of use asset is first measured at cost. The cost of the right-of-use asset consists of the present value of the lease payments as of the
date the lease obligation begins, the amount obtained by deducting all lease incentives received, and the sum of all initial direct costs incurred by the lessee. The right-of-use
assets of banks and companies within the scope of consolidation are measured by the cost method. Fixed assets accounted for as right-of-use assets are depreciated taking
into account the contract period.
In accordance with TFRS 16, the lease liability is calculated by discounting future lease payments using the Bank’s or alternative borrowing interest rates at the date of initial
application or contract. The interest on the lease obligation for each period in the lease term is the amount found by applying a fixed periodic interest rate to the remaining
balance of the lease obligation. Interest expenses and exchange differences related to lease obligations are associated with the profit or loss statement.
Within the scope of consolidation, there is 1 company (İş Finansal Kiralama A.Ş.) that exclusively engages in financial leasing transactions and 1 bank (Türkiye Sınai Gelişim
Bankası A.Ş.) that engages in financial leasing activities in accordance with Article 4 of the Banking Law No. 5411, financial leasing activities are carried out within the
framework of the Financial Leasing, Factoring, Financing and Saving Financing Companies Law No. 6361.
XVI.
Insurance Technical Income and Expense
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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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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 Parent Bank obtained a technical actuarial valuation report from a licensed actuary for the year ended December 31, 2023. 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, 2023 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.
On the other hand, within the scope of the temporary article added to the Social Insurance and General Health Insurance Law No. 5510 dated 31.5.2006 by Law No. 7438
published in the Official Gazette No. 32121 dated 01.03.2023, those who request to receive a pension after the effective date of the relevant article are subject to the relevant
regulations. Accordingly, those who will be granted old-age or retirement pensions are given the opportunity to benefit from old-age and retirement pensions if they meet other
conditions other than age in the said provisions.
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.
Pursuant to the amendment made in Article 32 of the Corporate Tax Law with the Law No. 7394, the corporate tax rate has been determined as 25%, starting from the
declarations that must be submitted as of 01.07.2022 and being valid for the corporate earnings for the taxation period starting from 01.01.2022. On the other hand, the
Law No. 7456 published in the Official Gazette No. 32249 dated 15.07.2023 and the Corporate Tax Law No. 32. in accordance with the amendment made to the article, the
corporate tax rate has been determined as 30% starting from the returns that must be submitted as of 01.10.2023 and applying to corporate earnings of institutions for the
year 2023 and subsequent taxation periods. The corporate tax rate valid for the period 31.12.2023 is 30%.
As per the Corporate Tax law, temporary tax is calculated and in the first nine months of the year, 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.
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. On the other hand, with the Law No. 7456 published in the Official Gazette dated 15.07.2023 and
numbered 32249, the exception for 50% of the income arising from the sale of immovables in Article 5.1.e of the Corporate Tax Law has been abolished.However, pursuant
to the temporary article 16 added to the Corporate Tax Law with the 22nd article of the Law No. 7456, the pre-amendment provisions will be taken into consideration for the
immovables included in the assets of the institutions before 15.07.2023. The 50% rate will be applied as 25% for the real estate sales earnings to be made after 15.07.2023.
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, the TPL financial statements were not subjected to inflation correction in the 2021,2022 and 2023 accounting periods and the provisional tax periods
of the 2023 accounting period, including the provisional tax periods, and the TPL financial statements dated 31.12.2023 were subject to inflation correction, regardless of
whether the inflation adjustment conditions were met or not. In accordance with TPL Provisional Article 33, profit/loss differences arising from the inflation adjustment made
on 31.12.2023 and required to be shown in previous years’ profit/loss accounts do not affect the corporate tax base. However, with the regulation made by the Law No. 7491 on
Amendments to Certain Laws and Decree Laws, the profit/loss difference arising from the inflation adjustment to be made by banks and financial institutions in the 2024 and
2025 accounting periods, including the provisional tax periods, will be taken into account in determining the earnings. It is regulated that it will not be taken.
With the regulations in paragraph (Ç) of Article 298 of the TPL and Provisional Article 32, taxpayers have been given the opportunity to optionally revaluate within the scope
of the TPL General Communiqué No. 537. However, these revaluation opportunities cannot be used in periods where inflation adjustment is applied in accordance with Article
298 bis of the TPL. However, in accordance with paragraph (A) of Article 298 of the TPL and Provisional Article 33, revaluation cannot be made within the scope of paragraph
(Ç) of the same article in periods when inflation adjustment is required. In case of inflation adjustment in the period following the end of the revaluation period, inflation
adjustment is applied based on the values found by taking into account the last values of the revalued depreciated economic assets.
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 calculated based on the tax rates that are valid or almost certain to come into force in the period when assets are created or liabilities are fulfilled and are
recorded as expense or income in the income statement. However, deferred tax is recognized directly in equity accounts if it relates to assets directly attributable to equity in
the same or a different period.
Pursuant to the amendment made in Article 32 of the Corporate Tax Law with the Law No. 7394, the corporate tax rate has been determined as 25%, starting from the
declarations that must be submitted as of 01.07.2022 and being valid for the corporate earnings for the taxation period starting from 01.01.2022. On the other hand, in
accordance with the Law No. 7456 published in the Official Gazette dated 15.07.2023 and numbered 32249 and the amendment made in Article 32 of the Corporate Tax Law,
the corporate tax rate should start from the declarations that must be submitted as of 01.10.2023 and it has been determined as 30% to be applied to the corporate earnings of
the institutions for the year 2023 and the following taxation periods. The deferred tax rate valid is 30%.
According to the Provisional Article 33 of the Tax Procedural Law, in the financial statements dated 31.12.2023, the tax effects resulting from the inflation correction of
corporate tax are included in the deferred tax calculation as of 31.12.2023.
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.
338
339
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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
Although corporate profits in the England are subject to 19% corporate tax, the corporate tax rate has been determined as 25% for companies with commercial profits over
250 thousand GBP as of 01.04.2023. 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 20% 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 25th 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 tax on the income of the
securities in question is paid within the framework of a single tax payment every month, as is the case with the tax on other securities.
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.
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
Prior Period
72,253,773
250,002,250
0.289012491
61,598,670
250,002,250
0.246392462
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.
340
341
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
286,243,371
202,998,955
Other items to be defined by the BRSA
SECTION FOUR: INFORMATION ON THE FINANCIAL POSITION AND RISK MANAGEMENT OF THE GROUP
I.
Explanations on Shareholders’ Equity:
1. Explanations on Consolidated Shareholders’ Equity
The Bank’s consolidated capital adequacy ratio is 19.86%. (31.12.2022: 21.84%). 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 31.01.2023, numbered 10496. Within the scope of the Board decisions, the amount subject to credit risk has been calculated by using
the CBRT exchange rates as of 30.12.2022, 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” acquired before the Board decision dated 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
Current Period
Prior Period
11,615,938
138,553
109,809,482
87,512,538
72,625,319
72,253,773
371,546
(1,070)
4,542,611
11,615,938
138,551
58,096,893
68,326,750
61,471,023
61,598,670
(127,647)
(1,117)
3,350,917
Valuation adjustments calculated as per the article 9, (i) of the Regulation on Bank Capital
Current and prior periods' losses not covered by reserves, and losses accounted under equity according to TAS
Leasehold improvements on operational leases
Goodwill Netted with Deferred Tax Liabilities
7,950,753
271,232
27,994
2,921,913
138,681
27,994
Other Intangible Assets Netted with Deferred Tax Liabilities Except Mortgage Servicing Rights
6,858,049
3,739,302
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
799,140
548,624
342
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 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
Current Period
Prior Period
15,907,168
7,376,514
270,336,203
195,622,441
5,348,088
2,931,155
5,348,088
2,931,155
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 (-)
Deduction from Additional Tier 1 Capital when there is not enough Tier II Capital (-)
Total Deductions from Additional Tier I Capital
Total Additional Tier I Capital
Total Tier I Capital (Tier I Capital= Common Equity Tier I Capital + Additional Tier I Capital)
TIER II CAPITAL
5,348,088
2,931,155
275,684,291
198,553,596
Debt Instruments and the Related Issuance Premiums Defined by the BRSA
35,660,250
25,342,500
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)
Provisions (Amounts explained in the first paragraph of the article 8 of the Regulation on Bank Capital)
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
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
2,262,711
1,418,336
18,868,119
56,791,080
12,249,588
39,010,424
56,791,080
39,010,424
332,475,371
237,564,020
3,230
3,230
2,650
2,650
343
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Current Period
Prior Period
2. Information on instruments to be included in the consolidated capital calculation:
Other items to be Defined by the BRSA
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
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
Remaining Mortgage Servicing Rights
Net Deferred Tax Assets arising from Temporary Differences
Limits for Provisions Used in Tier II Capital Calculation
General Loan Provisions for Exposures in Standard Approach (before limit of one hundred and twenty-five per ten thousand
General Loan Provisions for Exposures in Standard Approach Limited by 1,25% of Risk Weighted Assets
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
332,472,141
237,561,370
1,673,761,385
1,087,995,231
16.15
16.47
19.86
4.070
2.500
0.070
1.500
10.47
17.98
18.25
21.84
4.060
2.500
0.060
1.500
12.25
453,026
385,225
14,637,453
974,110
26,712,369
18,868,119
20,463,080
12,249,588
Issuer
Unique identifier (CUSIP, ISIN etc.)
Governing law(s) of the instrument
Subject to 10% deduction as of 01.01.2015
Eligible at unconsolidated / consolidated
Instrument type (types to be specified by each jurisdiction)
Amount recognized in regulatory capital (Currency in mil. as of most recent reporting date)
Par value of instrument (Expressed in million TL)
Accounting classification
Original date of issuance
Perpetual or dated
Original maturity date
Issuer call subject to prior supervisory approval
Optional call date. contingent call dates and redemption amount
Subsequent call dates. if applicable
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
Noncumulative or cumulative
Convertible or non-convertible
If convertible, conversion trigger (s)
Türkiye İş Bankası A.Ş.
US90016BAF58
XS1623796072
XS2106022754
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.
No
No
Unconsolidated -Consolidated
Unconsolidated -Consolidated
Bond
11,774
14,718
Bond
22,076
22,076
Subordinated Liabilities
Subordinated Liabilities
29.06.2017
Dated
11 Years
Yes
22.01.2020
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 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
9.192 %
None
None
None
None
Fixed
7.75 %
None
None
None
Noncumulative
None
Noncumulative
None
344
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Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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)
If write-down, full or partial
If write-down, permanent or temporary
If temporary write-down, description of write-up mechanism
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)
Partially or completely
Partially or completely
Permanent
Permanent
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.
Incompliance with article number 7 and 8 of “Own fund regulation”
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.
Issuer
Türkiye İş Bankası A.Ş.
Unique identifier (CUSIP, ISIN etc.)
TRSTISB72712
TRSTISB62911
TRSTISB92918
Governing law(s) of the instrument
Taking into account in equity calculation
Subject to 10% deduction as of 01.01.2015
Eligible at unconsolidated / consolidated
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.
No
Unconsolidated –
Consolidated
No.
Unconsolidated -
Consolidated
No
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)
Nominal value of instrument (TL Million)
Bond
660
1,100
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
Optional call date, contingent call dates and redemption amount
Subsequent call dates, if applicable
Interest/Dividend Payment
Fixed or floating coupon/dividend payments
Coupon rate and any related index
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
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
None.
Floating
None.
Floating
None.
Floating
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
Convertible into equity shares
If convertible, conversion trigger (s)
If convertible, fully or partially
If convertible, conversion rate
Non-cumulative
Non-cumulative
Non-cumulative
None.
None.
None.
346
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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
Permanent
Permanent
Permanent
If temporary write-down, description of write-up mechanism
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
Shareholders’ Equity
Group Share
Minority Interest
Leasehold improvements on operational leases
Goodwill and intangible assets
Provisions
Subordinated debt
Deductions from shareholders’ equity
Capital
Carrying Amount
Amounts in Equity
Calculation (1)
303,356,840
268,197,169
35,159,671
271,232
7,138,241
26,712,369
39,870,982
272,063
285,373,110
273,219,700
12,153,410
(271,232)
(6,886,043)
18,868,119
35,660,250
(272,063)
332,472,141
(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 31.01.2023
and numbered 10496.
348
II.
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)
Current Period
Risk Amount
Average
Risk Amount (2)
Risk Classifications
Conditional and Unconditional Exposures to Central Governments or Central Banks
884,240,243
743,438,344
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
232,776
384,460
942,716
132,110,005
732,792,711
441,975,008
48,487,544
41,651,568
7,208,371
176,263,122
17,506,880
141,895,241
84,462,150
(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.
216,852
347,298
995,219
111,888,407
697,740,603
376,442,490
43,619,880
37,225,150
5,379,166
123,415,661
15,178,591
120,629,796
62,100,919
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Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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
Derivative instruments 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 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.
Current Period
Prior Period
Loan Balance
Net Value of the
Collateral
Loan Balance
Loan Balance
Real Estate Mortgage (1)
7,969,997
7,969,997
6,507,435
6,507,435
Cash Collateral
Vehicle Pledge
Other (Suretyship, commercial enterprise under pledge,
commercial papers, etc.)
15,633
267,687
15,633
267,687
1,884
257,315
1,884
257,315
12,045,105
12,045,105
9,965,770
9,965,770
(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.
6.
11. The aging analysis of the receivables past due but not impaired in terms of financial asset classes, is as follows:
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 35% respectively (December 31,
2022: 27%, 36%).
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 43% and 55% respectively (December
31, 2022: 42%, 54%).
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 13% and 17%
(December 31, 2022: 14%, 19%).
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 24,851,338 (December 31,
2022: TL 19,356,556).
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
54.21 %
38.36 %
7.43 %
Prior Period
50.00 %
44.71 %
5.29 %
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)
1,880,399
14,321,198
1,417,099
13,961,519
Cash Collateral (Cash, securities
pledge, etc.)
62,125
989,423
48,410
571,392
Current Period
31-60 Days (2)
61-90 Days (2)
Total
Loans (1)
Corporate / Commercial Loans (3)
Consumer Loans
Credit Cards
Lease Receivables (1)
Insurance Receivables
Total
3,101,335
298,188
633,703
2,169,444
193,453
84,518
3,379,306
1,220,796
236,952
260,241
723,603
78,396
52,713
1,351,905
4,322,131
535,140
893,944
2,893,047
271,849
137,231
4,731,211
(1) The loans classified under close monitoring that are not past due or past due for less than 31 days is TL 109,134,062.
(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 1,412,908 and TL 2,958,416 respectively.
(3) Includes factoring receivables.
Prior Period
31-60 Days (2)
61-90 Days (2)
Total
Loans (1)
Corporate / Commercial Loans (3)
Consumer Loans
Credit Cards
Lease Receivables (1)
Insurance Receivables
Total
855,693
173,399
229,354
452,940
70,092
35,541
961,326
496,431
184,153
128,202
184,076
53,594
31,006
581,031
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.
Pledge on Wages and Vehicles
4,716,955
543,210
91,078
3,092,378
369,527
70,586
387,931
59,642,176
456,308
38,558,904
Cheques & Notes
Other (Suretyship, commercial
enterprise under pledge, commercial
papers, etc.)
Non-collateralized
11,258,893
9,398,114
14,807,864
7,040,513
12,221,280
3,941,709
Total
18,306,303
84,985,199
14,807,864
12,054,708
65,753,208
3,941,709
(*) 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.
350
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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
855,947,086
8,932,753
672,528
18,687,876
884,240,243
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
232,751
384,156
742,659
200,057
25
304
74,731,384
31,875,000
15,487,399
674,774
3,967,009
5,374,439
Corporate Receivables
687,220,492
8,672,421
13,969,797
3,160,755
212,127
19,557,119
Retail Receivables
437,015,865
979,944
433,864
4,980
155,037
3,385,318
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
Other Receivables
Stock Investments
89,038,500
235,894
199,472
3,122
60,984
601,140
7,083,494
85,326
5,451
174,621,066
141,508
11,922
8
82
9,102
24,990
18,811
1,469,733
17,506,880
141,117,600
403,516
374,125
84,462,150
232,776
384,460
942,716
132,110,005
732,792,711
441,975,008
90,139,112
7,208,371
176,263,122
17,506,880
141,895,241
84,462,150
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
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
Corporate Receivables
Retail Receivables
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
Other Receivables
Stock Investments
Total
437,104,238
4,009,835
1,136,971
8,976,781
451,227,825
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
513,925,870
6,007,066
5,226,167
1,802,060
358,182
12,298,386
262,831,684
436,757
221,429
2,824
73,375
1,860,128
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
88,033,703
119,358
10,484
976
100,414
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
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
(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.
Total
2,484,899,274
52,069,021
30,682,087
3,843,721
5,095,598
49,100,944
84,462,150
2,710,152,795
(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.
352
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
13.
Risk Profile by Sectors or Counterparties:
(1) (**)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
(10)
(11)
(12)
(13)
(14)
TL
FC
Total
Current Period
Consolidated
Current Period
Consolidated
Sectors/Counterparty (*)
Agriculture
Farming and Stockbreeding
Forestry
Fishing
Industry
Mining
Production
105,147
89,218
3,261
12,668
320
320
6,060,962
3,069
790
115,131
5,917,643
Electricity, gas, and water
28,188
3,069
Construction
Services
1,864,244
423,650,322
Wholesale and Retail Trade
2,806,878
Hotel, Food and Beverage
Services
Transportation and
Telecommunication
311,406
333,118
790
12,924
7,066,974
5,088,751
84,687
1,893,536
350,453,852
9,679,598
243,578,623
97,195,631
57,441,027
14,527,203
14,408,435
64,324
54,444
22,548,555
426,554
21,744,983
377,018
10,280,274
94,114,050
53,476,125
1,316,580
1,298,120
10,434
8,026
32,155
32,057
60
38
968,243
918,352
7,365
42,526
20,885,355
3,131,267
24,016,622
20,559,841
1,275,412
21,835,253
167,426
158,088
2,705
170,131
1,853,150
2,011,238
15,760,432
2,223,834
26,657,384
62,172,180
234,936,262
250,944,796
485,881,058
251,320
15,091
386,320
14,572,191
406,482
21,485,703
936,921
1,802,261
4,785,361
7,697,829
1,729,758
6,237,027
5,351,056
5,522,958
10,874,014
62,172,180
209,618,002
160,259,803
369,877,805
19,967,204
85,162,035
105,129,239
45,584,412
39,678,671
85,263,083
37,761,063
663,058
41,630,164
14,797,540
8,418,696
8,318,510
511,257,027
518,906,158 1,030,163,185
18,753,772
367,793
24,712,171
252,112
167,511,906
42,936,397
210,448,303
15,080,207
5,767,849
3,647,431
70,362
2,164,452
16,318,829
10,722,878
27,041,707
61,199,057
22,133,840
3,774,947
146,891
8,479,846
133,178
47,804,210
48,396,667
96,200,877
368,538
942,716
130,364,385
269,134,143
110,079,452
Financial Institutions
419,735,562
6
942,716
130,364,385
49,350,186
Real Estate and Renting Services
Self-Employment Services
Education Services
Health and Social Services
54,218
88,917
119,393
200,830
255,050
109,602
2,284
1,596
1,888
12,768,699
2,106,217
2,047,860
16,502,465
1,745,620
48,696,715
Other
Total
452,559,568
229,707
884,240,243
232,776
384,460
942,716
132,110,005
732,792,711
1,810,024
3,540,464
2,421,109
748,379
4,216,260
300,504,926
441,975,008
914,425
8,365,664
575,724
781,956
947,144
984
15,422
47,615
1,967
12,024
354,021
14,797,540
8,418,696
7,933,220
249,376,378
385,245,387
634,621,765
2,771,040
859,289
573,422
1,715,923
13,531,404
14,239,153
27,770,557
5,223,970
2,358,836
984,503
6,208,473
1,916,425
4,275,261
9,131,494
14,464,748
23,596,242
27,603,208
2,559,566
100,770,304
2,709,340
133,476,545
13,971,460
949,466,962
135,361,885 1,084,828,847
90,139,112
7,208,371
176,263,122
17,506,880
141,895,241
84,462,150
1,762,130,018
948,022,777 2,710,152,795
(1) Receivables from Central Governments or Central Banks
(10) Past due receivables
(2) Receivables from Regional Governments or Local Authorities
(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.
354
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Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
14. Analysis of maturity-bearing exposures according to remaining maturities:
16. Miscellaneous Information According to Type of Counterparty of Major Sectors
1 Month
1-3 Months
3-6 Months
6-12 Months
Over 1 Year
Total
Current Period
Current Period
Remaining Maturities
Significant Sectors/Counterparty
Loans
Provisions
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
83,044,597
13,675,239
15,565,770
21,371,190
360,477,136
494,133,932
3,723
5,310
8,901
19,875
194,967
232,776
49,179
104,206
189,241
1,819
36,086
380,531
745,472
129,260
67,984
942,716
77,419,729
17,618,876
11,637,730
10,700,627
10,347,746
127,724,708
77,158,171
11,529,479
83,878,354
91,409,095
131,565,410
341,432,001
725,443,031
9,113,785
14,169,374
44,235,462
62,992,783
142,040,883
3,375,563
4,594,725
4,174,437
17,278,183
52,149,434
81,572,342
10,212,014
14,834,115
12,725,638
51,163,910
55,529,084
144,464,761
Total
263,537,927
143,953,870
149,880,186
276,336,476
883,227,221
1,716,935,680
(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.
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
18. Exposures Subject to Countercyclical Capital Buffer
Explanations about exposures subject to consolidated private sector receivables:
Risk Amounts according to Risk Weights
0%
20%
35%
50%
75%
100%
150%
250%
Other (2)
Mitigation in
Shareholders’
Equity
Turkey
TRNC
England
Germany
1,009,237,767 153,087,519 48,635,838
159,608,857
296,481,120
885,411,670
102,874,153
453,026 81,527,878
7,157,275
Cayman Islands
Risk
Weight
Amount
Before
Credit Risk
Mitigation
(1)
Amount
After
Credit Risk
Mitigation
1,021,471,586 150,207,758
48,487,544
157,489,407
287,065,696 860,576,973 102,872,926
453,026 81,527,879
7,157,275
(1) The figures represent total risk amounts before credit risk mitigation and after credit conversion factor.
356
1
1.1
1.2
1.3
2
2.1
2.2
2.3
3
4
4.1
4.2
4.3
4.4
4.5
4.6
4.7
4.8
5
6
Agricultural
Farming and Raising Livestock
Forestry
Fishing
Industry
Mining
Production
Electricity, gas, and water
Construction
Services
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
Other
Total
Depreciated (TFRS 9)
Significant Increase in Credit
Risk (Stage 2)
Non-Performing (Stage 3)
Expected Credit Loss
(TFRS 9)
1,024,244
944,006
5,475
74,763
40,939,406
54,107
11,233,071
29,652,228
7,320,363
35,482,656
5,563,205
6,643,360
10,746,858
14,263
10,457,380
1,927,529
76,738
53,323
33,332,697
118,099,366
115,205
113,384
92
1,729
11,498,840
138,678
2,252,945
9,107,217
7,965,885
4,860,383
1,753,348
366,794
1,639,603
131,352
794,679
123,286
12,911
38,410
6,719,736
31,160,049
151,251
143,500
376
7,375
18,325,525
143,501
3,463,976
14,718,048
6,758,130
10,803,327
1,907,474
657,876
3,861,830
39,191
3,985,068
299,169
14,125
38,594
6,381,382
42,419,615
17.
Information on Value Adjustments and Change in Credit Provisions
Stage 3 Provisions
Stage 1 and Stage 2 Provisions
20,565,590
19,356,556
9,827,522
21,729,777
-6,945,937
-16,234,995
23,447,175
24,851,338
Beginning Balance
Provisions
Reversal of
Provisions
Other Value
Adjustments
Ending Balance
Country
RWA Calculations for Private
Sector Loans in Banking
Book
RWA calculations for Trading
Book
Total
1,042,225,900
5,000,524
1,047,226,424
9,385,398
8,248,074
4,076,504
2,565,591
2,212,669
2,142,940
1,950,073
1,892,968
1,711,225
9,770,523
2,301
7,374
9,385,398
8,250,375
4,083,878
2,565,591
2,212,669
2,142,940
1,950,073
1,892,968
1,711,225
292,561
10,063,084
357
Albania
Kosovo
Georgia
Malta
Russia
Other
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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
December 31, 2023
December 29, 2023
December 28, 2023
December 27, 2023
December 26, 2023
December 25, 2023
USD
29.4350
29.4350
29.3051
29.2230
29.1474
29.0100
EUR
32.5698
32.5698
32.4495
32.4696
32.1700
31.9545
The Parent Bank’s last 30-days arithmetical average foreign currency purchase rates:
USD: 28.9493 TL
EURO: 31.6085 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, IQD 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
10 % increase
10 % decrease
10 % increase
10 % decrease
10 % increase
10 % decrease
10 % increase
10 % decrease
431,900
(431,900)
262,337
(262,337)
201,857
(201,857)
146,591
(146,591)
875,154
(875,154)
969,497
(969,497)
74,654
(74,654)
170,580
(170,580)
USD
EURO
IQD
GEL
(1) Indicates the values before tax.
358
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
Financial Assets at Fair Value through Other Comprehensive Income
Loans (2) (3)
Investments in Associates, Subsidiaries and Jointly Controlled
Entities (Joint Ventures)
132,840,394
180,127,870
47,840,764
360,809,028
19,503,909
2,007,153
10,746,102
291,697,476
311,107
19,673,908
8,875,135
112,849,344
275,136,671
27,358,858
17,288,693
17,771
13,047,034
66,536,675
28,170,981
123,613,217
579,881,181
311,107
Financial Assets measured at Amortized Cost
5,481,317
16,683,969
9,238,720
31,404,006
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
Derivative Financial Liabilities Held for Risk Management
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
290,883
208,590
237,199
6,629
5,869
(1,687,050)
13,016,080
260,729
46,255
1,848,857
237,199
558,241
260,714
13,177,887
461,399,881
626,612,674
116,947,681
1,204,960,236
8,139,450
277,833,296
3,334,610
77,420,001
2,161,546
9,037,657
12,071,949
389,998,509
10,270,449
353,225,095
49,269,715
153,602,419
117,353,150
18,802,919
130,762
27,523,608
730,178,117
544,355
184,068,988
129,594
16,859,983
789,008
2,992,251
18,954,254
815,127,379
52,604,325
231,152,014
136,374,679
28,629,584
130,762
42,587,808
205,384,179
1,325,560,805
71,401,372
(103,565,443)
(88,436,498)
(120,600,569)
(68,776,043)
105,983,618
59,994,933
128,770,976
116,352,751
218,727,216
112,743,598
134,232,514
93,949,880
109,864,634
15,914,754
12,145,414
276,634,303
248,259,335
386,644,093
489,541,816
65,449,457
109,137,926
28,374,968
(102,897,723)
(43,688,469)
(20,551,336)
44,021,624
64,572,960
68,534,599
115,206,059
180,200,359
64,994,300
81,161,704
44,954,458
49,667,448
4,712,990
9,262,376
131,157,455
388,586,783
257,429,328
262,730,679
728,727,853
846,939,077
(118,211,224)
139,609,181
273,889,431
134,280,250
158,958,679
(1) Precious metals accounts amounting TL 42,576,277 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”, TL 12,633,044 of Derivative Financial Assets Accrual, Prepaid Expenses (588,342 TL) in assets, and 2,867,987 TL of Derivative Financial Liabilities Accruals in liabilities, Equity
(1,662,553) are not taken into account in the currency risk calculation. Other Assets and Other Liabilities include Expected Loss Provisions; the expected loss provision balance of foreign currency indexed
loans is TL 26,961.
(3) Includes receivables from leasing transaction and factoring receivables and foreign currency indexed loans which are recognized under TL account. Of the total amount of TL 1,814,773 of the
aforementioned loans; TL 971,945 is USD indexed, TL 838,694 is EUR indexed, and TL 4,134 is GBP indexed.
(4) Includes Assets Held for Sale and Discontinued Operations (Net).
(5) The item includes TL 116,452,555 precious metals deposit accounts.
(6) Includes Tier 2 subordinated bond which is classified on the balance sheet as subordinated loan.
(7) The borrower funds are presented in the “Other Liabilities” according to their type of currency.
(8) 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.
Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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:
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
47,430,849
479,203,797
526,634,646
Banks
35,040,005
10,202,924
5,489,746
34,535,062
85,267,737
Financial Assets at Fair Value through
Profit/Loss (1)
9,021,412
15,332,513
9,202,119
7,356,540
193,094
24,491,003
65,596,681
Money Market Placements
7,405,094
143,119
391,472
7,939,685
Financial Assets at Fair Value Through
Other Comprehensive Income
65,425,625
21,305,094
46,825,512
81,239,472
79,055,466
3,174,057
297,025,226
Loans (2)
461,701,076
139,393,899
449,042,649
251,250,349
77,436,403
2,687,876
1,381,512,252
Financial Assets Measured at Cost
32,564,200
43,764,605
45,682,673
59,012,432
35,154,138
216,178,048
Other Assets (3)
Total Assets
Liabilities
Bank Deposits
Other Deposits
17,827,639
253,789
445,939
1,357,660
354,703,269
374,588,296
676,415,900
230,395,943
557,080,110
400,216,453
191,839,101
898,795,064 2,954,742,571
80,815,367
5,838,509
3,533,544
4,194,566
1,419,938
95,801,924
625,167,023
228,570,623
95,197,055
12,346,736
2,278,958
650,689,501
1,614,249,896
Money Market Funds
Miscellaneous Payables
116,606,655
13,983,896
7,103,764
13,139,721
69,098
65,023
18,723
102
137,713,038
242,299,472
255,573,416
% Change in the Interest Rate (1)
Effect On Profit/Loss
Effect on Equity (2)
Marketable Securities Issued (4)
3,978,242
8,192,421
59,377,440
52,000,787
25,465,659
TL
FC
Current Period
Prior Period
Current Period
Prior Period
Funds Provided from Other Financial
101,803,299
86,796,765
43,509,198
7,613,448
1,517,883
149,014,549
241,240,593
100 bps increase
100 bps increase
100 bps decrease
100 bps decrease
1,022,934
(538,116)
1,008,028
(1,166,480)
(7,317,460)
7,931,980
(3,977,233)
4,308,848
Other Liabilities (5) (6)
5,583,705
2,400,610
3,519,439
692,455
1,896,529
447,056,417
461,149,155
Total Liabilities
947,094,012
345,851,922
212,305,463
76,866,817
31,159,029 1,341,465,328 2,954,742,571
(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.
Balance Sheet Long Position
344,774,647
323,349,636
160,680,072
828,804,355
Balance Sheet Short Position
(270,678,112)
(115,455,979)
(442,670,264)
(828,804,355)
Off Balance Sheet Long Position
6,331,470
30,152,790
21,282,389
Off Balance Sheet Short Position
(39,966,224)
(12,466,143)
57,766,649
(52,432,367)
Total Position
(264,346,642)
(85,303,189)
304,808,423 344,632,025
148,213,929 (442,670,264)
5,334,282
(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.
360
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Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Interest rate sensitivity of assets, liabilities and off-balance sheet items (Based on time remaining to repricing date):
b.
Average interest rates applied to monetary financial instruments:
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
7,453,621
194,392,278
201,845,899
Banks
20,803,477
2,766,863
210,855
15,213,620
38,994,815
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 Profit/Loss (1)
6,895,940
8,859,810
4,802,754
9,381,655
80,451
23,114,891
53,135,501
Financial Assets at Fair Value Through Other Comprehensive Income
Money Market Placements
5,032,776
685,950
476,616
6,195,342
Financial Assets at Fair Value
Through Other Comprehensive
Income
45,203,231
27,170,040
46,089,905
44,113,918
37,416,879
2,131,604
202,125,577
Loans (2)
236,210,546
102,037,625
293,405,120
222,419,187
57,350,982
940,273
912,363,733
Financial Assets Measured
at Cost
17,770,899
22,876,252
25,522,859
27,002,656
13,783,495
106,956,161
Other Assets (3)
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
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
Liabilities
Bank Deposits
Other Deposits
4,621,637
2,508,509
2,756,604
228,279
1,192,084
11,307,113
(1) Includes leasing receivables and factoring receivables.
366,805,419
100,178,746
39,502,856
3,446,087
884,470
430,511,241
941,328,819
(2) Includes Tier 2 subordinated bond which is classified on the balance sheet as subordinated loan.
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
Marketable Securities Issued
(4)
Funds Provided from Other
Financial Institutions
14,199,907
4,368,607
10,823,154
37,789,516
24,722,121
91,903,305
45,719,157
65,261,065
35,110,948
7,629,899
2,260,530
155,981,599
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
277,394,484
253,638,346
79,356,568
610,389,398
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
Balance Sheet Short Position
(140,558,695)
(17,001,939)
Off Balance Sheet Long Position
7,997,276
21,622,707
Off Balance Sheet Short Position
(6,956,126)
(10,009,441)
(7,856,740)
(452,828,764)
(610,389,398)
Financial Assets at Fair Value Through Other Comprehensive Income
29,619,983
(24,822,307)
Loans (1)
Financial Assets Measured at Amortized Cost
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 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.
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.
362
4.75
3.80
2.64
4.19
7.95
3.31
4.19
0.33
4.81
6.74
0.25
6.02
4.75
4.46
5.76
6.94
9.58
7.29
7.83
0.55
7.04
7.22
0.50
7.56
7.10
6.60
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
6.77
43.80
31.13
42.79
36.34
38.83
29.35
43.88
30.84
43.13
43.83
37.00
38.30
20.21
13.59
16.47
31.73
20.59
23.92
12.64
11.63
9.71
20.49
7.50
15.26
363
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Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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:
Investment in Shares
Book Value
Comparison
Fair Value
Market Value
Quoted
Investment in Shares Group A
Subsidiaries
Financial Subsidiaries
Non-Financial Subsidiaries (1)
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.
141,832,935
62,236,826
453,026
116,460
18,504,471
(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
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
Private Equity Investments
Shares Traded on a Stock
Exchange
Other Stocks
Total
60,592,749
60,592,749
3,446,422
3,446,422
64,039,171
64,039,171
(1) 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
62,236,826
19,073,957
81,310,783
62,236,826
19,753,496
81,990,322
4,978,946
1,580,280
6,559,226
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.
The Group’s Foreign Currency (FC) and total (TL+FC) liquidity coverage ratio (LCR) averaged for the last three months are given below.
October 31, 2023
November 30, 2023
December 31, 2023
October 31, 2022
November 30, 2022
December 31, 2022
Current Period
TL+FC
212.88
191.60
202.58
Prior Period
TL+FC
160.65
155.09
154.99
FC
FC
352.66
394.01
501.50
457.48
467.81
487.23
364
365
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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
Total Unweighted Value (1)
Total Weighted Value (1)
TL+FC
FC
TL+FC
FC
High Quality Liquid Assets
High Quality Liquid Assets
Cash Outflows
Retail and Small Business Customers, of which;
1,043,188,451
553,893,702
Stable deposits
Less stable deposits
178,198,560
864,989,891
553,893,702
629,451,586
305,341,901
95,408,917
8,909,928
86,498,989
55,389,370
55,389,370
Unsecured wholesale funding, of which;
552,128,377
251,509,630
290,141,600
135,475,949
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
Other irrevocable or conditionally revocable off-balance sheet
obligations
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 (%)
4,444,101
390,693,283
156,990,993
9,240,532
3,497,237
53,207
202,785,152
48,671,271
19,406,460
1,100,025
183,740,186
105,301,389
5,536,385
9,240,532
13,302
89,549,695
45,912,952
5,541,822
19,406,460
13,663,165
3,497,237
13,663,165
5,743,295
5,743,295
5,743,295
5,743,295
12,342,442
8,965,706
617,122
448,285
915,854,600
265,476,403
76,722,865
24,381,089
477,667,421
240,642,975
72,424
230,996,122
7,783,394
100,951,313
90,748,874
157,815,084
7,783,394
82,299,151
90,748,874
238,851,940
191,700,187
165,598,478
173,048,025
Upper Limit Applied Values
629,451,586
305,341,901
312,068,943
76,680,102
202.35
416.06
(1) The simple arithmetic average calculated for the last three months of weekly simple arithmetic average.
Prior Period
High Quality Liquid Assets
High Quality Liquid Assets
Cash Outflows
Retail and Small Business Customers, of which;
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
Total Unweighted Value (1)
Total Weighted Value (1)
TL+FC
FC
TL+FC
FC
611,317,338
99,605,132
511,712,206
334,798,824
3,005,540
227,527,733
104,265,551
8,511,344
3,273,748
377,077,839
377,077,839
187,403,972
36,219
151,835,763
35,531,990
19,369,975
308,711,858
204,903,813
56,151,478
4,980,257
51,171,221
168,815,630
739,822
100,701,866
67,373,942
224,756
8,511,344
37,707,784
37,707,784
98,329,464
9,055
66,519,903
31,800,506
13,731
19,369,975
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
Total Cash Inflows
Total HQLA Stock
Total Net Cash Outflows
Liquidity Coverage Ratio (%)
274,712,653
174,585,625
4,195,089
100,584,121
2,727,740
65,700,311
116,821,011
107,506,950
182,521,322
500,968
74,655,489
2,727,740
77,884,197
54,622,443
116,821,011
171,443,454
Upper Limit Applied Values
308,711,858
204,903,813
196,828,456
43,646,406
156.91
470.84
(1) The simple arithmetic average calculated for the last three months of the monthly simple arithmetic average.
Compared to the prior period, it is observed that in the last quarter of 2023, the total liquidity coverage ratio decreased due to the increase in the total cash outflows, and
foreign currency liquidity coverage ratio decreased due to the decrease in high-quality 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 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 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 Parent Bank.
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Loans (3)(4)
44,325,356
273,359,423
182,377,850
445,957,142
323,945,024
80,387,408
31,160,049
1,381,512,252
(1) Includes bonds that have the nature of issued secondary subordinated loans, which are classified as subordinated loans on the balance sheet.
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
(1)
Total
Current Period
Assets
Cash (Cash in Vault, Foreign
Currency Cash, Money in
Transit, Cheques Purchased)
and Balances with the Central
Bank of Turkey
325,191,237
201,443,409
Banks
39,780,796
29,794,271
10,202,924
5,489,746
24,489,605
8,606,085
15,087,693
9,401,720
7,790,393
221,185
7,405,094
143,119
391,472
3,174,057
6,700,241
5,449,599
19,196,433
167,867,279
94,637,617
297,025,226
9,624,470
10,494,696
22,833,219
111,744,570
61,481,093
216,178,048
96,773,779
32,234,394
620,326
445,939
8,888,946
235,624,912
374,588,296
533,734,830
569,167,387
224,376,207
503,715,671
620,236,212
236,727,303
266,784,961 2,954,742,571
1,419,938
80,815,367
5,838,509
3,531,074
4,197,036
650,689,501
625,166,712
228,569,949
95,194,896
12,349,880
2,278,958
15,065,150
10,527,815
97,234,798
74,027,576
44,385,254
113,722,805
7,344,825
13,818,570
2,826,838
3,978,245
6,848,753
59,377,435
52,505,726
26,304,390
526,634,646
85,267,737
65,596,681
7,939,685
95,801,924
1,614,249,896
241,240,593
137,713,038
149,014,549
255,573,416
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
Marketable Securities Issued
(5)
Other Liabilities (6)
Total Liabilities
808,916,742
958,917,699
269,318,713
273,627,845
148,835,233
73,352,209
421,774,130 2,954,742,571
Liquidity Gap
(275,181,912)
(389,750,312)
(44,942,506)
230,087,826
471,400,979
163,375,094
(154,989,169)
Net Off Balance Sheet Position
(6,881,365)
(2,992,561)
4,265,848
2,325,839
1,095,278
Derivative Financial Assets
Derivative Financial Liabilities
163,018,487
146,493,730
126,246,164
177,671,662
100,876,791
169,899,852
149,486,291
121,980,316
175,345,823
99,781,513
Non-cash Loans
213,191,409
15,934,004
36,067,080
122,388,467
32,475,508
11,438,878
(2,186,961)
714,306,834
716,493,795
431,495,346
Prior Period
Total Assets
Total Liabilities
Liquidity Gap
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
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
(323,468,635)
(208,443,663)
1,606,298
220,319,842
327,098,459
108,497,183
(125,609,484)
Net Off Balance Sheet Position
(2,790,449)
(3,320,632)
1,584,643
Derivative Financial Assets
Derivative Financial Liabilities
189,216,660
72,157,698
45,268,853
192,007,109
75,478,330
43,684,210
88,054,382
Non-cash Loans
131,529,790
7,843,265
19,534,617
66,168,088
17,943,149
2,846,840
90,901,222
550,941
76,163,585
75,612,644
7,497,012
(1,128,657)
473,708,018
474,836,675
250,515,921
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.
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
652,109,439
711,303,915
245,480,407
107,405,571
17,888,472
2,504,652 1,736,692,456
26,640,636 1,710,051,820
14,211,043
12,739,417
108,772,694
97,742,756
60,572,209
294,038,119
52,797,526
241,240,593
113,921,928
7,595,285
14,670,141
2,983,048
139,170,402
1,457,364
137,713,038
4,902,231
8,220,987
65,675,975
73,728,751
27,605,588
180,133,532
31,118,983
149,014,549
73,767
143,186
692,052
1,763,747
802,328
3,475,080
1,177,566
2,297,514
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
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
(1) Includes Tier 2 subordinated bond which is classified on the balance sheet as subordinated loan.
Current 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
31,144,756
180,438,843
112,735
1,495,075
9,012,915
5,857,787
1,063,302
17,823,437
31,375,441
1,435,456
271,522
91,063,527
16,429,069
79,711,026
29,844,537
7,519,194
319,800,456
1,801,074
11,230,350
13,500
71,650
187,849
1,007,666
14,395,310
3,648,162
6,236,053
213,191,409
15,934,004
36,067,080
122,388,467
32,475,508
11,438,878
431,495,346
Prior Period
Demand
Letters of Credit
Letters of Guarantee
Acceptances
Other
Total
21,031,210
109,360,483
137,720
1,000,377
Up to 1
Month
4,990,207
2,525,641
327,417
1-3
Months
3-12
Months
1-5
Years
5 Years and
Over
Total
8,488,974
21,584,064
502,220
271,840
56,868,515
10,142,096
37,774,002
16,297,174
4,653,229
180,752,625
864,033
39,514
6,723,990
347
86,032
1,143,408
2,571,943
8,053,507
4,841,274
131,529,790
7,843,265
19,534,617
66,168,088
17,943,149
7,497,012
250,515,921
Miscellaneous Payables
156,760,227
96,056,258
47,076
24,113,162
874,945
9,313,917
67,379
4,403,693
1,814,607
1,113,570
383,607
421,774,130
461,149,155
The following table shows the remaining maturities of non-cash loans of the Group.
(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.
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Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
The following table shows the remaining maturities of derivative financial assets and liabilities of the Group.
c. Explanations on consolidated leverage ratio
Current Period
Forwards Contracts- Buy
Forwards Contracts- Sell
Swaps Contracts -Buy
Swaps Contracts -Sell
Futures Transactions-Buy
Futures Transactions-Sell
Options-Call
Options-Put
Other
Total
Prior Period
Forwards Contracts - Buy
Forwards Contracts - Sell
Swaps Contracts - Buy
Swaps Contracts - Sell
Futures Transactions - Buy
Futures Transactions - Sell
Options - Call
Options – Put
Other
Total
Up to 1
Month
1-3
Months
3-12
Months
16,047,685
34,583,371
40,622,766
15,715,974
34,167,820
39,850,046
1-5
Years
7,139,832
7,180,993
5 Years and Over
Total
98,393,654
96,914,833
109,610,250
73,575,295
55,906,804
169,859,750
95,117,782
504,069,881
129,456,287
97,973,935
53,570,734
167,492,749
94,022,506
542,516,211
1,680,418
1,632,380
9,881,648
686,464
117,093
29
34
15,411,675
26,011,557
10,288,507
14,962,342
25,723,820
2,366,911
1,749,507
5,759,008
57,063,888
5,759,008
56,733,677
38,605,190
24,502,026
6,540,690
1,344,161
70,992,067
332,918,339
295,980,021
248,226,480
353,017,485
200,658,304 1,430,800,629
On-Balance Sheet Items
On-balance sheet items (excluding derivatives and SFTs. but including
collateral)
Asset amounts deducted in determining Basel III Tier 1 capital
The total amount of risk on-balance sheet exposures
Derivative exposures and credit derivatives
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
Investment securities or commodity collateral financing transactions
The amount of risk investment securities or commodity collateral financing
transactions (Excluding on balance sheet items)
Current Period (1)
Prior Period (1)
2,748,990,955
(6,698,908)
2,742,292,047
26,558,286
12,761,335
39,319,621
1,639,991,435
(3,634,115)
1,636,357,320
18,799,552
7,562,976
26,362,528
27,687,784
14,350,224
5 Years and Over
Total
Risk amount of exchange brokerage operations
Up to 1
Month
1-3
Months
3-12
Months
8,245,045
8,292,895
11,228,799
10,969,931
12,917,860
12,661,924
1-5
Years
2,530,422
2,492,528
34,922,126
34,417,278
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
The total amount of risk investment securities or commodity collateral financial
transactions
27,687,784
14,350,224
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
1,001,650,208
(17,861,041)
983,789,167
244,442,367
3,793,088,619
477,654,908
(19,938,537)
457,716,371
174,084,953
2,134,786,443
6.,44
8.14
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 6.44% (December 31, 2022: 8.14%). According to Regulation the minimum leverage ratio is 3%. The changes in the leverage ratio are mostly
due to the increase in the total risk amount.
b. Summary Comparison Table Related to Total Amount of Asset and Risk Situated in The Consolidated Financial Statements Prepared in Accordance with TAS:
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 355,115 increase/decrease.
Summary Comparison Table Related to Total Amount of Asset and Risk Situated in The Consolidated Financial
Statements Prepared in Accordance with TAS
Current Period
Prior Period
2,391,282,849 (1)
1,749,395,167
IX.
Explanations on Presentation of Assets and Liabilities at Fair Value
1. Information on fair values of financial assets and liabilities
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
61,635,593 (1)
33,963,598
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)
(12,761,335)
(7,562,976)
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)
60,610,743
39,516,082
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)
20,464,892
21,574,281
The other differences between amount of assets and risk in the Communiqué on Preparation of Consolidated
Financial Statements of Banks (2)
Total Exposures (2)
772,547
(1,672,308)
3,793,088,619
2,134,786,443
(1) As the consolidated financial statements dated 31.12.2023 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 30.06.2023 are included.
(2) The amounts in the table represents the average of three months.
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
7,939,685
85,267,737
297,025,226
216,178,048
6,195,342
38,994,815
202,125,577
106,956,161
7,939,685
6,195,342
85,232,825
39,037,629
297,025,226
202,125,577
203,858,397
127,548,531
1,350,352,203
885,150,975
1,280,192,453
871,796,926
95,801,924
1,614,249,896
241,240,593
149,014,549
257,055,896
11,307,113
941,328,819
155,981,599
91,903,305
151,090,917
95,803,711
10,949,385
1,613,688,089
941,495,895
240,033,197
152,058,375
148,491,671
89,153,363
257,055,896
151,090,917
370
(1) Factoring and Leasing Receivables are included.
(2) Includes Tier 2 subordinated bond which is classified on the balance sheet as subordinated loan.
371
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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
16,227,541
3,551,151
12,247,618
161,990,146
294,567
69,861
3,891,717
658,024
21,100,639
7,715,358
126,836,219
2,660,248
8,364,356
204,633
5,024,806
(1) Since they are not traded in an active market, the equity securities (TL 149.379) 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
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 available-for-sale are shown in the financial statements at acquisition cost and the related
securities are not shown in this table.
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.
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.
General Information on Risk Management and Risk Weighted Amounts
a.
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 main risk types,
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
The movement table of financial assets at level 3 is given below:
Balance at the Beginning of the Period
Purchases
Redemption or Sales
Valuation Difference
Transfers
Foreign Currency Difference
Balance at the end of the Period
Current Period
Prior Period
maturity, sector, geography, risk ratings, arrears, defaults,
Measuring the assets and liabilities management risk, and reporting of measurement results,
3,850,525
2,077,141
(2,181,515)
1,369,873
113,415
5,229,439
3,939,588
1,922,461
(2,785,690)
673,556
100,610
3,850,525
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.
372
373
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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 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 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.
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, 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, Audit 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.
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.
Subsidiaries Risk Operations
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.
374
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.
a.2. General Information on Risk Weighted Amounts
Credit risk (excluding counterparty credit risk) (CCR)
Of which standardised approach (SA)
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
Risk Weighted Amount (1)
Current Period
Prior Period
Minimum Capital
Requirements
Current Period
1,473,074,629
1,473,074,629
17,246,745
17,246,745
953,524,113
953,524,113
16,407,066
16,407,066
117,845,970
117,845,970
1,379,740
1,379,740
Equity investments in funds – look-through approach
17,506,880
9,051,377
1,400,550
Equity investments in funds – mandate-based approach
Equity investments in funds - 1250% weighted risk approach
Settlement risk
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
The amounts below the thresholds for deduction from capital
(subject to a 250% risk weight)
Floor adjustment
Total
488,675
21,438
39,094
36,747,700
36,747,700
127,564,191
127,564,191
42,220,363
42,220,363
65,807,811
65,807,811
2,939,816
2,939,816
10,205,135
10,205,135
1,132,565
963,063
90,605
1,673,761,385
1,087,995,231
133,900,910
375
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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
Assets
Cash and CBRT
321,184,876
526,634,646
526,634,646
Banks and Money Market Placements
80,546,562
93,207,422
93,207,422
Financial Assets at Fair Value Through Profit/
Loss
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 (-)
Assets Held for Sale and Discontinued
Operations
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
40,044,014
44,496,042
33,936,258
246,326,953
297,025,226
297,025,226
45,151,060
21,100,639
21,100,639
21,100,639
1,102,406
10,559,784
1,077,774
7,441,999
1,133,735,184
1,381,512,252
1,381,509,022
3,230
159,146,950
216,178,048
216,178,048
44,542,148
48,509,794
48,509,794
1,607,484
1,562,954
1,562,954
3,458,608
81,346,534
81,346,534
98,993,751
35,470,852
44,795,538
44,524,306
7,138,241
252,198
19,115,389
18,056,230
18,056,230
2,415,197
3,057,419
50,335
50,335
14,637,453
14,637,453
244,468,292
255,510,805
255,510,805
271,232
6,886,043
2,391,282,849
2,954,742,571 2,937,022,282
21,100,639
19,079,557
7,160,505
1,283,211,124
1,710,051,820
228,892,264
241,240,593
108,164,912
137,713,038
95,397,460
109,143,567
16,619,706
8,364,356
961,633
4,915,684
2,297,514
108,428,256
107,633,317
6,871,283
3,256,773
13,729,348
114,193
45,759,627
39,870,982
190,056,877
281,227,003
298,747,250
303,356,840
15,328,103
126,840,596
8,364,356
1,710,051,820
225,912,490
10,872,442
109,143,567
2,297,514
107,633,317
13,729,348
114,193
281,227,003
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
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
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 (-)
Assets Held for Sale and
Discontinued Operations
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
201,401,422
201,845,899
201,845,899
52,990,929
45,190,157
45,190,157
34,383,035
33,574,852
16,526,859
202,248,993
202,125,577
202,125,577
19,797,427
19,560,649
19,560,649
19,560,649
1,843,611
17,047,993
4,677,273
11,111,264
907,086,123
912,363,733
912,361,083
2,650
109,808,083
106,956,161
106,956,161
40,035,564
39,990,816
39,990,816
1,618,994
1,618,994
1,618,994
2,356,544
42,870,444
42,870,444
81,028,542
26,228,925
16,477,849
88,909
2,580,855
24,478,118
4,079,813
11,320,190
26,354
974,110
24,478,118
4,079,813
11,320,190
26,354
974,110
129,490,490
148,437,334
148,437,334
138,681
3,767,296
1,749,395,167
1,715,431,569
1,698,380,926
19,560,649
32,836,530
3,908,627
937,602,267
952,635,932
178,436,315
155,981,599
51,240,156
77,862,734
51,240,156
58,344,560
10,216,142
10,091,101
157,874
3,218,480
74,450,955
9,246,068
2,493,819
33,546,689
105,070,811
1,643,053
67,292,475
8,125,987
1,599,383
33,558,745
164,865,885
265,852,857
210,052,693
1,749,395,167
1,715,431,569
9,549,591
41,795,275
10,091,101
952,635,932
146,432,008
9,444,881
58,344,560
1,643,053
67,292,475
8,125,987
1,599,383
164,865,885
51,344,866
10,091,101
1,410,384,164
377
(1) June 30, 2022, amounts are represented, as consolidated financial statements dated December 31, 2023, 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.
376
2,391,282,849
2,954,742,571
142,168,699
8,364,356 2,460,981,694
(1) Leasing and Factoring Receivables are included.
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Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
b.2. The main sources of the differences between the risk amounts and the amounts assessed in accordance with TAS in the financial statements
1
2
3
4
5
6
7
8
9
1
2
3
4
5
6
7
8
9
Current Period
Total
Credit Risk
Securitization
Position
Counterparty
credit risk
Market risk
Asset carrying value amount under scope of TAS
2,954,742,571
2,937,022,282
21,100,639
19,079,557
Liabilities carrying value amount under scope of TAS
Total net amount under regulatory scope of
consolidation
2,954,742,571
2,937,022,282
163,269,338
10,715,201
(142,168,699)
8,364,356
Off-balance sheet amounts
1,828,679,147
295,987,663
32,479,479
32,195,515
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
10 Differences due to risk mitigation (2)
11 Risk Amounts
(517,132,967)
(45,698,438)
2,670,178,540
64,674,994
10,715,201
(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.
Prior Period
Total
Credit Risk
Securitization
Position
Counterparty
credit risk
Market risk
Asset carrying value amount under scope of TAS
1,715,431,569
1,698,383,576
19,560,649
32,836,530
Liabilities carrying value amount under scope of TAS
Total net amount under regulatory scope of
consolidation
1,715,431,569
1,698,383,576
70,905,515
22,745,429
(51,344,866)
10,091,101
Off-balance sheet amounts
998,385,339
170,131,232
26,399,369
13,503,864
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
10 Differences due to risk mitigation (2)
11 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.
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:
378
Current Period
Loans
Debt Securities
Off-balance sheet exposures
Total
Gross carrying value in financial statements
prepared in accordance with Turkish Accounting
Standards (TAS)
Defaulted
Non-defaulted
31,160,049
6,212,139
37,372,188
1,350,352,203
506,960,011
1,052,745,952
2,910,058,166
Allowances/ Amortization and
Impairments
Net Values
23,447,175
2,976,310
26,423,485
1,358,065,077
506,960,011
1,055,981,781
2,921,006,869
Prior Period
Loans
Debt Securities
Off-balance sheet exposures
Total
Gross carrying value in financial statements
prepared in accordance with Turkish Accounting
Standards (TAS)
Defaulted
Non-defaulted
27,212,758
1,998,636
29,211,394
885,150,975
301,641,082
465,938,988
1,652,731,045
c.1.3. Changes in Stock of Default Loans and Debt Securities (1)
Allowances/ Amortization and
Impairments
Net Values
20,565,590
1,618,580
22,184,170
891,798,143
301,641,082
466,319,044
1,659,758,269
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
27,212,758
24,445,092
18,368,786
(1,818,237)
16,050,821
(497,130)
(3,202,500)
(5,620,823)
(9,400,758)
(7,165,202)
31,160,049
27,212,758
(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.
c.1.4. Additional Information on 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 2023 is TL 3,202,500.
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
29,761,459
945,389
191,676
23,645
237,880
22,304,229
26,116,918
19,688,391
827,061
93,406
14,543
207,936
750,571
120,031
16,142
10,098
198,998
613,000
55,424
16,142
8,182
184,451
31,160,049
23,447,175
27,212,758
20,565,590
(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.
379
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
c.2. Credit Risk Mitigation
c.2.1. Qualitative Public Disclosures on Credit Risk Mitigation Techniques
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.
c.2.2. Credit Risk Mitigation Techniques – Standard Approach
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
1,314,887,203
28,522,161
26,396,380
14,655,713
12,212,755
Debt securities
506,960,011
Total
1,821,847,214
28,522,161
26,396,380
14,655,713
12,212,755
Of which defaulted
29,950,331
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
856,149,996
18,966,900
16,617,735
16,681,247
15,067,525
301,641,082
1,157,791,078
18,966,900
16,617,735
16,681,247
15,067,525
Of which defaulted
26,252,601
(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.
c.3.2. Standard Approach: Credit risk exposure and credit risk mitigation effects:
Current Period (1)
On-balance
sheet amount
Off-balance
sheet amount
On-balance
sheet amount
Off-balance
sheet amount
Risk- Weighted
Amount
Risk-Weighted
Amount
Density
Exposures before CCF and CRM Exposures post-CCF and CRM
RWA and RWA density
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 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
866,729,876
232,632
352,611
942,716
88,489,448
575,399,182
439,470,447
46,534,898
36,877,054
7,208,371
175,272,238
19,449
753
532,718
38,091,784
400,744,470
459,804,198
4,304,544
7,850,549
3,875,895
878,946,033
232,506
5,294,210
270
18,687,877
116,401
2.11%
50.01%
310,386
942,716
88,489,449
549,778,434
430,505,645
46,407,893
36,877,054
7,208,371
175,272,240
74,074
384,460
100.00%
43,620,556
183,014,277
11,469,363
2,079,651
4,774,514
990,882
42,344,650
637,814,347
234,630,623
16,970,640
24,669,614
4,114,743
301,272,510
0.00%
32.05%
87.04%
76.59%
35.00%
59.23%
57.08%
170.92%
17,506,880
141,116,389
84,462,150
2,480,594,892
18,573,132
933,797,492
17,506,880
17,506,880
100.00%
141,116,389
84,462,150
120,713,057
85,141,690
2,458,056,146 252,096,649 1,504,367,492
778,852
85.07%
100.80%
55.51%
(1) The off-balance sheet receivable amount after the credit conversion rate and credit risk reduction includes the counterparty credit risk amount.
Prior Period (1)
On-balance
sheet amount
Off-balance
sheet amount
On-balance
sheet amount
Off-balance
sheet amount
Risk- Weighted
Amount
Risk-Weighted
Amount
Density
Exposures before CCF and CRM Exposures post-CCF and CRM
RWA and RWA density
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
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
434,245,075
192,016
13,177
1,581
447,474,160
191,900
3,753,665
267
9,371,832
96,097
2.08%
50.01%
83,618
199,794
779,142
56,939,132
442,392,789
262,979,575
33,886,107
29,832,148
6,344,324
92,795,173
26,478,824
232,934,925
153,859,482
2,424,138
4,975,290
1,575,017
81,656
779,142
56,850,323
420,330,000
257,489,378
33,793,420
29,832,148
6,344,324
92,480,332
84,338
165,994
100.00%
24,976,239
119,287,731
7,936,819
1,121,348
3,155,777
145,490
25,682,713
471,218,676
147,526,675
12,220,169
19,936,999
4,655,385
155,142,393
0.00%
31.39%
87.32%
77.75%
35.00%
60.44%
73.38%
167.49%
9,016,377
35,000
9,016,377
35,000
9,051,377
100.00%
85,988,169
44,442,556
85,988,169
44,442,556
1,499,916,201 427,930,896 1,485,093,885
5,433,668
2,276,766
162,773,440
75,196,954
45,020,394
975,285,658
85.19%
101.30%
59.18%
(1) The off-balance sheet receivable amount after the credit conversion rate and credit risk reduction includes the counterparty credit risk amount.
380
381
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
c3.3. Standardised Approach: Receivables according to risk classes and risk weights:
% 0 (1)
% 10
% 20
% 25
% 35
% 50
% 75
% 100
% 150
% 250
Other
Total
Risk Weights
Consolidated
865,552,364
5
18,687,874
884,240,243
232,751
25
384,460
232,776
384,460
942,716
942,716
34,809
78,485,260
48,403,102
2,008,410
252,749
2,925,675
132,110,005
140,380
69,273,963
68,493,940
589,431,955
115,933
5,336,540
732,792,711
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
% 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
Retail exposures
75,579,854
169,278,670
20,567,673
135,577,961
287,065,696
19,331,351
48,487,544
33,963,909
7,687,659
441,975,008
48,487,544
41,651,568
7,208,371
6,190,941
204,759
1,013,746
3,684
292,139
102,500,560
73,265,664
176,263,122
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
265,426,197
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
19,223,356
1,021,471,586
2,448,535
150,207,758
48,487,544
157,489,407
287,065,696
84,009,124
453,026
84,462,150
120,223,350
141,895,241
860,576,973 102,872,926 453,026 81,527,879 2,710,152,795
17,506,880
17,506,880
(1) Includes securities and private pension receivables blocked by Anadolu Hayat Emeklilik A.Ş., one of Group Companies and it also includes the transactions of that are not subject to credit Yatırım Varlık Kiralama A.Ş.
a group companies.
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
(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.
382
383
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
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
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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)
7,770,211
6,157,010
1.4
13,927,221
5,365,678
17,784,820
7,122,496
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
Prior 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
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
384
10,017,752
3,868,472
11,624,066
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
13,927,221
13,927,221
4,584,733
4,584,733
12,872,026
12,872,026
4,648,339
4,648,339
Current Period
% 0
% 10
% 20
% 50
% 75
% 100
% 150
Other (1)
Risk Weights
Risk Groups
Conditional and unconditional exposures
to sovereigns and their central banks
5,269,352
Total Credit
Exposure
5,269,352
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
Exposures to corporates
Retail exposures
Other exposures
Total
44,699
44,699
10,149,508
10,251,223
691,352
299,796
674,759
4,306,078
25,274
21,075,490
5,297,226
25,274
8,262,215
8,262,215
5,269,352
10,840,860 10,551,019
25,274
5,025,536
8,262,215
39,974,256
Total Credit
Exposure
3,701,159
Risk Groups
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
Exposures to corporates
Retail exposures
Other exposures
Total
609
609
5,030,098
6,326,963
1
294,945
265,540
7,237,395
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
385
12,488,174
Risk Weights
Prior Period
% 0
% 10
% 20
% 50
% 75
% 100
% 150
Other (1)
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
d.5. Collateral for CCR:
Current Period
Received Collateral
Given Collateral
Segregated
Not Segregated
Segregated
Not Segregated
Received Collateral
Given Collateral
Collateral used in derivative transactions
Collateral used in other transactions
Cash- Domestic Currency
Cash- Other Currencies
Government bills/bonds-
Domestic
Total
Prior Period
Cash- Domestic Currency
Cash- Other Currencies
Government bills/bonds-
Domestic
Total
72,308,779
43,192,554
95,827
115,597,160
Collateral used in derivative transactions
Collateral used in other transactions
Received Collateral
Given Collateral
Segregated
Not Segregated
Segregated
Not Segregated
Received Collateral
Given Collateral
27,918,747
14,516,341
176,935
42,612,023
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 Committee and to the Board via the Audit Committee by the Risk Management Department.
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 are determined and the results are reported to the Bank’s
top management.
Post CRM risk
exposure
8,262,215
5,681,915
Current Period
RWA
173,838
165,244
113,638
Post CRM risk
exposure
6,151,960
6,141,646
Prior Period
RWA
134,661
123,039
122,833
2,580,300
51,606
10,314
206
81,017
89,465
276,977
8,594
69,551
11,622
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
g.
Explanations on Operational Risk
RWA
Current Period
Prior Period
32,588,451
9,899,613
9,292,763
10,044,800
3,351,275
4,159,249
41,380,414
6,589,513
6,289,388
24,489,138
4,012,375
839,949
4,159,249
839,949
36,747,700
42,220,363
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.
386
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, 2023, the consolidated operational risk amount is TL 127,564,19
information about the calculation is given below (December 31, 2022: TL 65,807,811).
Current Period
2PP Amount
1PP Amount
CP Amount
Total/Positive
Years of Gross
Income Amount
Rate (%)
Total
Gross Income
35,126,147
45,254,025
123,722,534
3
15
10,205,135
Value at operational risk (Total*12.5)
127,564,191
Prior 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
387
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)
(i)
OTC Derivatives
Exchange-traded Derivatives
(iii)
transactions and securities or commodities
Repo-reverse transactions, credit securities
(iv)
Netting sets where cross-product has been
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)
(i)
OTC Derivatives
Exchange-traded Derivatives
(iii)
transactions and securities or commodities
Repo-reverse transactions, credit securities
(iv)
Netting sets where cross-product has been
Segregated initial margin
Non-segregated initial margin
Pre-funded default fund contributions
Unfunded default fund contributions
Explanations on securitisations:
e.
None.
f.
Explanations on Market Risk:
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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 Management 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 Parent Bank’s capital is examined.
In the calculations made within the framework of the said regulation, behavioural maturity modelling 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 Parent 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.
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.
Currency
Applied Shock
(+/- x basis point)
Gains Loss
Revenue/Shareholders’ Equity –
Loss/ Shareholders’ Equity
Information about The Group’s segments are presented below.
TL
TL
EUR
EUR
USD
USD
Total (for Negative Shocks)
Total (for Positive Shocks)
i.
Remuneration policy
(+) 500
(-) 400
(+) 200
(-) 200
(+) 200
(-) 200
(21,568,915)
20,909,473
3,750,644
(3,811,179)
(6,416,272)
8,649,826
25,748,120
(24,234,543)
(6.80%)
6.59%
1.18%
(1.20%)
(2.02%)
2.73%
8.12%
(7.64%)
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 2023, the Remuneration
Committee met 11 times and made a total of 14 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 2023, the number of qualified employees working at the Bank is 28.
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.
388
Current Period
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
Corporate /
Commercial
Banking
Individual
/ Private
Banking
116,310,547
61,097,478
37,115,755
19,279
42,961,866
56,873,530
12,281,383
4,482,080
7,097,774
10,500,484
832,240
2,605,597
30,737,948
Treasury
Transaction/
Investment
Activities
88,956,715
28,440,202
2,951,131
783,730
421,522
40,744,739
9,136,147
90,701
2,611,733
13,434,857
Insurance and
Reinsurance
Activities
Other/
Unallocated
Total
1,325
545,146
5,113,779
9,024,036
21,817,070
3,748,614
10,592,175
40,821,375
376,568
45,370,400
8,864,896
14,218,932
34,435,856
257,253,164
168,229,605
56,642,029
16,508,963
421,522
40,744,739
64,136,738
24,389,572
123,656,421
13,434,857
99,848,488
13,478,534
86,369,954
72,253,773
14,116,181
Total Assets
Total Liabilities
861,968,015
794,292,908
282,070,339
857,854,579
813,008,736
501,297,072
168,162,383
234,395,692
829,533,098
566,902,320
2,954,742,571
2,954,742,571
Corporate /
Commercial
Banking
Individual
/ Private
Banking
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
Current Period
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
Treasury
Transaction/
Investment
Activities
Insurance and
Reinsurance
Activities
Other/
Unallocated
Total
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
480,658,344
157,614,122
495,054,758
491,060,752
281,996,061
90,261,982
127,426,701
304,304,684
330,295,705
1,715,431,569
1,715,431,569
389
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
SECTION FIVE: DISCLOSURES AND FOOTNOTES ON THE CONSOLIDATED FINANCIAL STATEMENTS
c.
Positive differences on derivative financial assets held for trading:
I.
a.
DISCLOSURES AND FOOTNOTES ON CONSOLIDATED ASSETS
Cash and Central Bank of the Republic of Turkey:
a.1.
Information on Cash and Balances with the Central Bank of the Republic of Turkey:
Current Period
Prior Period
TL
FC
TL
FC
Cash in TL / Foreign Currency
Central Bank of the Republic of Turkey
5,531,808
160,293,810
25,345,814
334,500,936
962,278
4,109,112
17,609,487
11,719,560
167,972,940
434,800
180,127,300
165,825,618
360,809,028
21,718,599
Other
Total
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
135,665,280
157,731,281
17,609,487
45,917,045
24,628,530
160,293,810
176,769,655
334,500,936
17,609,487
7,453,446
114,602,449
167,972,940
(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 0% - 30% for
TL deposits and other liabilities, between 20 - 30% for FC deposits and precious metal deposit accounts and between 5% - 21% for other FC liabilities. As of 08.07.2023, 5
points will be added to the required reserve ratios, application has been removed as of 18.08.2023, determined for FX deposits and precious metal deposit accounts for banks
whose share of TL deposits calculated for real and legal persons in total deposits is less than 57%.
Obligations subject to reserve requirements are calculated and set aside every two weeks on Friday for 14-day periods.
According to the Communiqué on Required Reserves published in the Official Gazette dated 31.12.2022 and numbered 32060, the possibility of establishing Turkish lira
required reserves in gold terminated as of 23.06.2023.
The annual 8% commission application, which is applied by differentiating according to the Turkish lira share, has been abolished as of 01.09.2023. As of 29.09.2023,
differentiated according to the transition from accounts provided with exchange rate protection support by the Central Bank to Turkish lira accounts and the renewal of these
accounts, an annual commission of 8% has been introduced.
With the press release of the CBRT dated 27.10.2023, it was announced that a change was made in the commission application according to the renewal and transition to TL
rate and the commission application according to the TL share. Accordingly, while the commission rate of banks with a conversion rate of less than 100% will be between 6%
and 8%. If the banks with a conversion rate of 100% and above will have a conversion rate of 10% to TL and a renewal rate of 75% and above commission will not be applied.
For banks that fall below the target in any of the relevant ratios, a commission equal to the remaining portion will be calculated. On the other hand, the renewal rate target has
been abolished and the TL transition rate target has been increased from 10% to 15%, effective after 22.12.2023. In addition, a commission rate of 2% will be applied if the TL
share calculation for real persons remains below 0.5% and 2.2% points, differentiated according to the TL share levels compared to the calculation period four weeks ago, and
1% if the TL share calculated for legal entities remains below the TL share calculated according to 18.08.2023, a commission rate of 1% will be applied
Within the scope of the amendment made by the Communiqué on Amendments to the Communiqué No. 2013/15 (2023/30), published in the Official Gazette No. 32357
dated 02.11.2023, foreign currency deposits (excluding foreign bank deposits and precious metal deposit accounts) for all maturities, the reserve requirement ratio to be
established in Turkish lira is 4 percent. The required reserve ratio, which was previously determined as 15% for all maturities for accounts provided with exchange rate/price
protection support by the Central Bank, is 30% for accounts with maturities up to 6 months (including 6 months) and 10% for accounts with maturities of 1 year or more.
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:
Financial assets at fair value through profit and loss, which are given as collateral or blocked as of 31 December 2023, amount to TL 465,061 (December 31, 2022: TL
16,575,962).
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 2023, amount to TL 16,675,686 (December 31, 2022: TL
217,562).
b.3. TL 2,676,996 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.
Derivative Financial Assets at Fair Value through Profit or Loss (1)
Forward Transactions
Swap Transactions
Futures
Options
Other
Total
Current Period
Prior Period
TL
323,868
147,262
65,573
FC
667,547
16,197,638
466,813
2,921,299
TL
316,139
83,046
214,537
FC
708,561
16,423,805
180,080
1,246,555
536,703
20,253,297
613,722
18,559,001
(1) Includes information related 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.
Banks Account
d.1.
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
TL
FC
17,163,490
1,567,572
4,703,047
61,833,628
6,541,346
1,292,499
646,341
30,514,629
18,731,062
66,536,675
7,187,687
31,807,128
Current Period
Prior Period
Unrestricted Amount
Restricted Amount
Unrestricted Amount
Restricted Amount
33,406,404
4,307,724
3,406,500
13,238,769
54,359,397
913,393
113,128
989,187
7,026,095
9,041,803
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
(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
Currency Exchange Difference
Provisions at the end of the period
170,156
143,367
(26,175)
95,038
382,386
85,738
74,131
(25,179)
35,466
170,156
390
391
Looking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate CitizenFinancial Reports and Annexesİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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 92,723,492 as of 31 December 2022 (December 31,
2022: TL 73,609,538).
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 104,654,004 as of 31 December 2022
(December 31, 2022: TL 39,707,583).
e.3.
Information on financial assets at fair value through other comprehensive income:
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
Current Period
Prior Period
312,893,361
187,927,207
124,966,154
3,108,895
267,927
2,840,968
21,075,868
2,098,838
297,025,226
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
(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.
f.
Information related to loans:
Leasing and factoring receivables are considered as loans in the footnotes of this section.
f.1.
Information on all types of loans and advances given to shareholders and employees of the group:
Direct Lending to Shareholders
Corporate Shareholders
Individual Shareholders
Indirect Lending to Shareholders
Loans and Other Receivables to Employees
Total
Current Period
Prior Period
Cash
Non-Cash
Cash
Non-Cash
1,682,003
1,682,003
1,239
1,239
598,361
598,361
1,418
1,418
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
392
1,232,252,837
387,283,276
168,049,469
49,288,239
153,314,489
202,388,317
271,929,047
51,541,377
13,429,610
373,855
15,966,903
10,406,157
11,364,852
47,353,064
35,702,504
152,854
43,381
4,401,707
7,052,618
19,204,925
11,441,984
267,129
2,296,019
5,199,793
1,232,252,837
51,541,377
47,353,064
19,204,925
Current Period
Prior Period
Standard Loans
Loans Under
Close Monitoring
Standard Loans
5,878,898
4,718,789
Loans
Under Close
Monitoring
18,972,440
14,637,767
Cash Credit
Standard Loans
Loans Under Close Monitoring
Loans Not Subject to Restructuring
Refinanced
Short-term Loans
Medium and Long-term Loans
617,977,196
614,275,641
20,082,155
31,459,222
7,780,643
58,777,346
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
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)
Total
29,855,067
120,592,793
39,138,128
5,694,858
75,759,807
1,093
1,093
210,770
26,877
183,893
7,398,313
7,398,313
235,545
8,353
3,871
223,321
7,556
2,267
1,074
4,215
12,519
12,519
72,785
197,655
29,584,627
11
11
152,774,425
61,109,311
91,665,114
466,826
466,826
550,059
980
549,079
459
459
656,623
274,216
382,407
4,036
4,036
16,761,702
69,728
2,733,291
532,064
85,623
2,115,604
19,135
19,135
746
133
613
1,744,448
230,790
1,513,658
65,765
118
235
65,412
69
22
11
36
2,449
2,449
517,003
153,181,151
39,742,977
5,978,136
107,460,038
20,228
20,228
211,527
27,010
184,517
161,917,186
68,738,414
93,178,772
466,826
466,826
851,369
8,471
5,086
837,812
8,084
2,289
1,085
4,710
671,591
286,735
384,856
4,036
4,036
17,278,705
69,728
201,138,936
128,458,589
5,082,906
334,680,431
393
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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
Commercial Loans with Installments-FC
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. Distribution of credits according to users:
Public
Private
Total
f.7. Domestic and foreign loans:
Domestic Loans
Foreign Loans
Total
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
f.10.
Information on non-performing loans (Net):
f.10.1 Information on non-performing loans, which are restructured by the Group:
Short-Term
Medium and Long-
Term
Interest and Income
Accruals
37,804,509
2,897
1,364,970
36,436,642
81,336,875
2,691,575
11,720,448
66,924,852
45,475
999
44,476
2,466,949
28,878
149,969
2,288,102
332,001
7,478
Total
121,608,333
2,723,350
13,235,387
105,649,596
377,476
8,477
324,523
368,999
2,135,123
12,127,780
137,324
14,400,227
113,440
2,021,683
52,235,926
18,587,027
33,648,899
50,620
50,620
6,924,663
11,208
99,162,049
5,106,498
7,021,282
1,507,059
1,507,055
4
42,840
94,484
342,937
342,937
355,967
95,017,189
3,635,178
Current Period
Prior Period
9,423,604
1,340,928,599
1,350,352,203
Current Period
Prior Period
1,299,257,450
51,094,753
1,350,352,203
Current Period
Prior Period
10,195,890
10,195,890
Current Period
Prior Period
6,300,081
3,133,708
14,013,386
23,447,175
5,262,778
9,137,449
54,085,922
20,094,082
33,991,840
50,620
50,620
7,280,630
11,208
197,814,416
7,172,079
877,978,896
885,150,975
851,121,329
34,029,646
885,150,975
2,343,655
2,343,655
1,533,076
4,047,910
14,984,604
20,565,590
Current Period
(Gross amounts before the provisions)
Restructured Loans
Prior Period
(Gross amounts before the provisions)
Restructured Loans
394
Group III
Loans with Limited
Collectability
Group IV
Loans with Doubtful
Collectability
Group V
Uncollectible Loans
1,000,949
1,000,949
1,486,706
1,486,706
1,615,487
1,615,487
1,782,784
1,782,784
6,778,909
6,778,909
6,373,775
6,373,775
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
3,004,570
2,207,058
561,586
235,926
17,849,278
11,167,318
3,870,693
2,810,526
741
8,066,516
4,095,833
2,566,199
1,403,743
741
2,220,710
481,703
986,783
752,224
6,437
322
2,841
3,274
1
1
10,999
8,198
2,801
10,571,183
8,804,716
879,257
887,210
6,300,081
5,409,306
376,846
513,929
4,271,102
6,551,024
5,349,698
889,562
311,764
58,215
39,223
6,788
11,836
368
8,066,516
4,095,833
2,566,199
1,403,743
741
7,492,495
5,201,200
1,633,666
656,520
1,109
3,021,919
2,185,617
566,693
269,609
7,510
729
1,822
4,959
186
5
164
17
54,254
53,819
435
4,207,899
2,151,022
1,260,639
796,238
3,133,708
1,879,245
702,054
552,409
1,074,191
17,657,164
15,587,999
1,355,752
655,521
57,892
461,293
422,318
15,436
4,757
18,782
7,492,495
5,201,200
1,633,666
656,520
1,109
6,422,594
5,447,587
733,679
236,944
4,384
2,272,530
2,233,537
25,330
13,650
13
915,836
347,597
322,885
236,980
8,374
380,975
329,328
51,463
184
16,380,967
13,512,124
1,974,423
829,224
65,196
14,013,386
11,747,685
1,480,115
723,957
61,629
2,367,581
1) As of 31.12.2023, as part of the amendment to the “Procedures and Principals regarding Classification of Loans and Allowances Allocated for Such Loans” published in the Official Gazette No. 30961,
dated 27.10.2019, receivables amounting to TL 2,055,760 was written off.
(2) In August 2023, our receivables, which constitute 711,576 TL of the portfolio consisting of non-performing loans receivables, were transferred to Birikim Varlık Yönetim A.Ş., Denge Varlık Yönetim A.Ş.,
Dünya Varlık Yönetim A.Ş., Gelecek Varlık Yönetim A.Ş., Ortak Varlık Yönetim A.Ş., Sümer Varlık Yönetim A.Ş. by collecting the sales price of 279,200 TL in cash. 1,969 TL of our transferred receivables
arise from our receivables that were previously written off from assets within the framework of the amendment made to the “Regulation on the Procedures and Principles Regarding the Classification of
Loans and Provisions to be Set Aside for These” published in the Official Gazette dated 27.11.2019 and numbered 30961. In December 2023, our receivables, which constitute 357,994 TL of the portfolio
consisting of non-performing loans receivables, were transferred to Dünya Varlık Yönetim A.Ş., and Emir Varlık Yönetim A.Ş. by collecting the sales price of 111,400 TL in cash. TL 151,578 of our transferred
receivables arises from our receivables that were previously written off from assets within the framework of the amendment to the “Regulation on the Procedures and Principles Regarding the Classification
of Loans and the Provisions to be set aside for them” published in the Official Gazette dated 27.11.2019 and numbered 30961.
After the sale of non-performing loans and the write-off, the consolidated non-performing loan ratio decreased from 2.47% to 2.26% as of 31.12.2023.
395
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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 (1)
Prior Period
Balance at the End of the Period
Provisions (-)
Net Balance on Balance Sheet (1)
Group III
Loans with Limited
Collectability
Group IV
Loans with Doubtful
Collectability
Group V
Uncollectible Loans
4,922,791
2,959,785
1,963,006
1,449,347
653,655
795,692
402,047
299,932
102,115
3,293,071
1,566,847
1,726,224
9,201,651
8,038,088
1,163,563
10,598,027
9,161,617
1,436,410
(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)
4,271,102
10,571,183
6,300,081
4,271,102
1,471,494
3,004,570
1,533,076
1,471,494
1,074,191
4,207,899
3,133,708
1,074,191
2,503,114
6,551,024
4,047,910
2,503,114
2,367,581
16,315,771
13,951,757
2,364,014
65,196
61,629
3,567
2,672,560
17,599,272
14,936,250
2,663,022
57,892
48,354
9,538
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 (-)
f.10.6 Explanations on write-off policy:
Group III
Loans with Limited
Collectability
Group IV
Loans with Doubtful
Collectability
Group V
Uncollectible Loans
221,083
516,989
295,906
80,448
157,677
77,229
80,901
200,706
119,805
353,634
1,025,286
671,652
242,739
1,718,759
1,476,020
251,539
1,519,085
1,267,546
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:
396
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
4,718,789
7,241,997
14,637,767
20,565,590
10,552,905
7,558,695
4,191,349
7,822,416
12,735,339
6,611,081
Transfers within the period
Write-offs from Assets
Transfer to Stage 1
Transfer to Stage 2
Transfer to Stage 3
Currency Exchange Difference
(6,906,199)
(5,616,127)
(4,055,244)
(7,765,588)
(3,892,653)
1,083,095
(544,920)
(213,259)
499,395
(1,043,460)
591,554
(1,911,030)
1,760,831
(2,804,424)
39,635)
(46,634)
2,124,289
144,538
492,459
(237,419)
(57,539)
273,111
(475,851)
312,730
(1,407,522)
754,643
15,898,604
12,402,374
(3,857,344)
(5,613,004)
(16,608)
(75,311)
1,465,061
361,818
Provisions at the end of the period
5,878,898
18,972,440
23,447,175
4,718,789
14,637,767
20,565,590
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 60,579,384 as at December 31, 2023 (December 31, 2022: TL 61,281,906).
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 22,560,328 at December 31, 2023 (December 31, 2022: TL
7,166,511).
g.3.
Information on government securities measured at Amortized cost:
Government Bonds
Treasury Bills
Other Public Debt Securities
Total
g.4.
Information on financial assets measured at amortized cost:
Debt Securities
Quoted on a Stock Exchange
Not Quoted (1)
Impairment Losses (-)
Total
Current Period
Prior Period
199,506,867
100,256,173
199,506,867
100,256,173
Current Period
Prior Period
216,178,048
192,762,735
23,415,313
106,956,161
96,996,697
9,959,464
216,178,048
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:
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
Current Period
Prior Period
106,956,161
11,268,869
121,861,350
(40,745,444)
16,837,112
216,178,048
51,545,328
3,782,273
60,382,102
2,022,376
(21,574,387)
10,798,469
106,956,161
397
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Expected credit loss for financial assets measured at amortised cost:
Current Period
Stage 1
Stage 2
Stage 3
Stage 1
Prior Period
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
Currency Exchange Difference
Provisions at the end of the period
h.
Information on Associates (Net):
68,670
195,247
(56,199)
3,563
211,281
28,994
61,491
(23,194)
1,379
68,670
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.
h.2.
Information on credit institution or financial institution associates that are not accounted by the equity method: None
Information on credit institution or financial institution associates that are accounted by the equity method:
Title
Address (City/ Country)
Bank’s Share Percentage-If Different.
Voting Percentage (%)
Bank’s Risk Group Share Percentage
(%)
Arap-Türk Bankası A.Ş.
İstanbul/Turkey
20.58
79.42
Information on financial statements of associates in the above order:
Total Assets
Shareholders’
Equity
Total Tangible
Assets
Interest Income
(1)
Securities
Income
Current Period
Profit/Loss
Prior Period
Profit/Loss
Fair Value
15,563,601
2,201,737
1,016,199
972,037
97
162,652
215,338
(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 (%)
Current Period
Prior Period
385,225
280,196
67,801
453,026
105,029
385,225
(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):
Current Period
Prior Period
453,026
385,225
Banks
Insurance Companies
Factoring Companies
Leasing Companies
Finance Companies
Other Financial Participations
Total
(1) Includes the information related to associate which is a credit institution in which the Bank has direct shares.
398
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.
Anadolu Hayat Emeklilik A.Ş. participated in the cash capital increase of its subsidiary Emeklilik Gözetim Merkezi A.Ş. in the current period by paying TL 2,857.
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:
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
i.2.
i.3.
Information on unconsolidated subsidiaries: None.
Information on consolidated subsidiaries:
Insurance /
Reinsurance
Companies
Türkiye Sınai
Kalkınma Bankası
A,Ş,
İşbank AG
İş Finansal Kiralama
A,Ş,
30,811,509
680,036
30,131,473
21,747,485
1,007,980
20,739,505
12,560,904
202,947
12,357,957
6,097,045
29,990
6,067,055
30,131,473
20,739,505
12,357,957
6,067,055
7,074,994
7,074,994
27,814,499
30,131,473
12,357,957
6,067,055
30,131,473
27,814,499
12,357,957
6,067,055
Title
Address (City/ Country)
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
Levent Varlık Kiralama A.Ş.
1-
2-
3-
4-
5-
6-
7-
8-
9-
10-
11-
12-
13-
14-
15- Maxis Girişim Sermayesi Portföy Yönetimi A.Ş.
16- Maxis Investments Ltd.
17- Milli Reasürans T.A.Ş.
18- Moka Ödeme ve Elektronik Para Kuruluşu A.Ş.
19- TSKB Gayrimenkul Yatırım Ortaklığı A.Ş.
20- Türkiye Sınai Kalkınma Bankası A.Ş.
21- Yatırım Finansman Menkul Değerler A.Ş.
22- 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
Istanbul/Turkey
London/England
Istanbul/Turkey
Istanbul/Turkey
Istanbul/Turkey
Istanbul/Turkey
Istanbul/Turkey
Istanbul/Turkey
Bank’s Share Percentage-If
Different. Voting Rights (%) (1)
50.23
74.84
66.29
46.51
45.42
60.48
35.37
67.47
67.98
24.46
100.00
100.00
100.00
67.98
67.98
67.98
87.60
100.00
44.78
50.46
48.90
48.90
Bank’s Risk Group Share
Percentage (%)
49.77
25.16
33.71
53.49
54.58
39.52
64.63
32.53
32.02
75.54
0.00
0.00
0.00
32.02
32.02
32.02
12.40
0.00
55.22
49.54
51.10
51.10
399
453,026
385,225
(1) Indirect share of the Group is considered as the Parent Bank’s share percentage.
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Financial statement information related to consolidated subsidiaries in the above order:
i.6.
Consolidated subsidiaries traded on stock exchange (1):
Total Assets
Shareholders’
Equity
56,381,518
162,865,081
296,796
24,005,377
51,557,546
31,191,034
2,242,201
978,725
41,220,341
372,635
67,285,904
11,890,612
5,158,288
103
307,945
3,519,769
22,668,143
1,385,991
3,366,099
180,913,852
5,598,442
1,621,851
12,217,136
6,449,458
266,368
3,083,927
6,769,900
25,209,951
2,234,936
848,523
16,512,401
366,938
14,039,466
2,196,726
1,484,387
94
284,786
353,702
10,128,118
94,464
3,344,980
21,825,052
637,290
674
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
Total
Tangible
Assets
1,000,560
303,078
9,595
26,239
65,031
24,696,795
3,447
11,765
378,891
460
451,318
139,393
102,809
6,529
9,075
183,087
7,114
3,271,714
3,675,723
74,785
Interest
Income (2)
Securities
Income
Current Period
Profit/Loss
Prior Period
Profit/Loss
Fair Value (3)
Additional
Shareholders’
Equity
Required
2,702,714
1,693,711
237,850
4,287,254
7,293,713
121,520
21,187
16,268
4,643,010
37,113
2,822,060
561,284
327,419
2
40,126
13,901
510,231
41,958
15,316
18,772,862
774,776
5,033,829
1,461,713
18,786
19,209
37,574
438,861
205,924
8,082,005
101,684
11,260
362,369
477
167,740
103,674
6,380,160
2,853,815
97,261
1,159,924
1,767,060
11,175,211
1,227,673
459,899
9,811,742
109,910
860,199
422,943
155,201
-6
266,187
101,702
3,629,008
47,877
1,535,587
7,149,926
282,714
371
1,323,552
1,391,752
51,395
445,386
826,766
8,364,189
732,001
224,749
4,529,607
80,245
323,549
478,434
82,366
8,969
31,829
888,620
2,351
1,069,466
4,105,739
115,122
66
29,773,500
16,229,060
7,779,741
14,340,024
1,663,556
45,652,500
1,562,310
3,868,150
18,242,000
(1) Within the framework of BRSA regulations, it includes values dated 31.12.2023 that are not subject to inflation accounting.
(2) Includes interest income on securities.
(3) 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
37,373,370
53,758
30,038,491
67,465,619
17,613,057
2,714,715
17,045,598
37,373,370
(1) Reveals the information related to companies subject to consolidation in which Bank directly owns share.
(2)The current period balance is due to the reclassification of Anadolu Hayat Emeklilik A.Ş. and İş Finansal Kiralama A.Ş.’s shares followed under Financial Assets at Fair Value Through Profit or Loss under
subsidiaries, and the prior period balance is due to the capital increase of Işbank AG.
(3) Includes accounting differences by equity method.
i.5.
Sectoral information on consolidated subsidiaries and the related carrying amounts (1):
Traded on domestic stock exchanges
Traded on foreign stock exchanges
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:
Current Period
Prior Period
40,271,948
22,198,019
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”.
The Parent Bank participated in the cash capital increase of TL 9,250,000 of Trakya Yatırım Holding A.Ş., which it owns 100%.
In the current period, İş Girişim Sermayesi Yatırım Ortaklığı A.Ş., a Group company, sold all of its shares in the capital of its subsidiary Nevotek Bilişim Ses ve İletişim Sistemleri
Sanayi ve Ticaret A.Ş. for TL 2.126 and sold to outside the group all of its shares in the capital of another subsidiary Mikla Yiyecek ve İçecek A.Ş. for TL 145.500.
As announced in the Parent Bank’s special event disclosures dated 25.08.2023 and 27.10.2023, it was decided to continue the partial division transactions in a simplified
manner with the participation model, through the financial statements dated 31.12.2023.
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
Net
Gross
Net
13,690,050
13,428,777
1,139,279
28,258,106
10,975,364
11,884,748
900,585
23,760,697
8,698,663
10,780,717
1,271,472
20,750,852
7,065,854
9,443,616
1,133,105
17,642,575
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
28,258,106
4,497,409
23,760,697
20,750,852
3,108,277
17,642,575
k.3.
Presentation of operating lease receivables according to their remaining maturities:
As at December 31, 2023 the remaining maturities of the Group’s operating lease receivable is less than 1 year the total amount is TL 93,070 (December 31, 2022; TL 35,795).
l.
Positive differences table for hedging derivative financial assets:
Part of Derivative Financial Assets at Fair Value Through Profit Loss (1)
Hedging Derivative Financial Assets
Hedging Cash Flow
Protection from Net Investment Risk Abroad
Total
Current Period
Net
Gross
310,639
310,639
Prior Period
Net
Gross
387,926
387,926
Banks
Insurance Companies
Factoring Companies
Leasing Companies
Finance Companies
Other Financial Subsidiaries
Total
(1) Reveals the information related to companies subject to consolidation in which Bank directly owns share.
Current Period
Prior Period
(1) Includes information on derivative financial assets for hedging purposes classified under derivative financial assets.
28,573,981
14,039,712
1,472,096
23,379,830
67,465,619
16,800,054
7,310,823
937,316
12,325,177
37,373,370
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
12,304,847
12,304,847
26,483,208
26,483,208
Current Period
Assets
94,859
94,859
215,780
215,780
Liability
Contract Sum
130,762
130,762
15,582,944
15,582,944
Prior Period
Assets
Liability
134,010
134,010
39,214
39,214
10,914,093
10,914,093
387,926
387,926
400
401
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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
(112,672)
77,745
(34,927)
Fixed Rate Loans Used
Interest Risk
107,833
(115,332)
Fixed Interest Rate
Eurobond
Interest Risk
(103,960)
152,334
(7,499)
48,374
(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
Interest Rate Swap Transactions
Interest Rate Swap Transactions
Cross Currency Swap Transactions
Fixed Interest rate
Eurobond and
Greenbond
Fixed Rate Loans Used
Fixed Interest Rate
Eurobond
Interest Rate Risk
Interest Rate Risk
Interest Rate Risk
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)
8,201
93,402
(76,245)
80,846
(3,496)
(94,182)
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.
m.
Information on Tangible Assets:
Current Period
Real Estate
Right-to-Use
Assets
Buildings Under
Construction
Vehicles
Other MDV
Total
Previous Period
Cost
Accumulated Depreciation
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
Accumulated Depreciaton at the End of the Period
Net Book Value at the End of the Period
20,694,380
(19,762)
20,674,618
3,502,559
(1,998,332)
1,504,227
20,674,618
18,379,219
(293,138)
(133,192)
18,334
38,677,652
(31,811)
38,645,841
1,504,227
1,224,322
(796,294)
158,073
5,163,854
(3,073,526)
2,090,328
311,421
311,421
311,421
217,052
528,473
528,473
78,021
(40,420)
37,601
5,160,629
(3,210,378)
1,950,251
37,601
32,018
(13,210)
1,608
114,950
(56,933)
58,017
1,950,251
2,417,243
(898,060)
3,445
7,674,348
(4,201,469)
3,472,879
29,747,010
(5,268,892)
24,478,118
24,478,118
22,269,854
(2,000,702)
(133,192)
181,460
52,159,277
(7,363,739)
44,795,538
(1) Includes the movements in cost value and accumulated depreciation items.
k.
Information on Intangible Assets:
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 536,694 (December 31, 2022: TL 275,199).
Net Book Value at the Beginning of the Period
Change During the Period (Net)
Revaluations Surplus/Deficit
Net Book Value at the End of the Period
m.
Information on deferred tax asset:
Current Period
Prior Period
11,320,190
(1,395,323)
8,131,363
18,056,230
4,601,916
190,204
6,528,070
11,320,190
As of December 31, 2023, the Parent Bank and the other consolidated Group companies has deferred tax asset amounting to TL 14,637,453. 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
629,472
(15,396,760)
107,969
386,583
(364,717)
(14,637,453)
59,702
(1,292,150)
66,033
259,564
(67,259)
(974,110)
(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.
Balance at the Beginning of the Period
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) (1)
Current Period
Prior Period
(625,273)
6,780,453
7,333,400
1,042,313
(7,633)
14,523,260
2,994,027
5,112,280
(8,745,726)
14,146
(625,273)
(1) In the consolidated financial statements, there are deferred tax assets of TL 14,637,453 and deferred tax liabilities of TL 114.193 in the current period. Explanations on deferred tax liability are given in
Section Five, Note II.h.2.
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
Provision for Decrease in Value
Foreign Currency Difference
Net Book Value at the End of the Period
Current Period
Prior Period
1,618,994
(62,651)
(190)
6,801
1,562,954
910,871
708,104
(7,042)
7,061
1,618,994
(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.
The other assets classified as “Fixed Assets Held for Sale” mostly consist of 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.
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.
The Group has no discontinued operations.
o.
Information on other assets of the group:
Current Period
Prior Period
Other assets item does not exceed 10% of the balance sheet total.
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)
402
The balance includes the movements in cost and accumulated depreciation items.
4,051,819
4,386,262
(1,425,520)
97,686
12,969,359
(5,859,112)
7,110,247
2,154,031
2,756,745
(912,870)
53,913
8,199,345
(4,147,526)
4,051,819
403
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Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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
72,206,209
17,511,367
157,038,120
227,466,867
17,360,564
12,239,090
3,774
503,825,991
Foreign Currency
Deposits
Residents in
Turkey
411,566,482
51,485,336
153,058,226
24,761,842
11,076,837
46,725,033
1,068
698,674,824
343,778,843
44,820,892
116,294,871
19,261,998
3,579,531
10,300,935
1,068
538,038,138
Residents Abroad
67,787,639
6,664,444
36,763,355
5,499,844
7,497,306
36,424,098
Public Sector Deposits
1,634,553
75,221
366,251
122,942
430
5
Commercial Deposits
61,006,380
85,271,302
23,979,704
69,582,262
25,114,833
12,497,610
Other Institutions
Deposits
Precious Metals
Deposits
1,676,230
2,997,524
5,529,104
5,328,329
103,904
9,942
102,599,647
2,937
3,979,932
821,987
8,683,669
364,383
Interbank Deposits
1,419,938
78,812,056
896,803
1,222,655
3,321,529
10,128,943
The Central Bank
of Turkey
Domestic Banks
Foreign Banks
Participation
Banks
974
82,546
1,335,595
823
75,646,900
3,165,156
502,329
394,474
164,775
1,222,655
3,156,754
10,128,943
160,636,686
2,199,402
277,452,091
15,645,033
116,452,555
95,801,924
974
76,396,550
19,403,577
823
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
179,078,644
142,427,842
53,207,056
39,482,651
98,271,661
76,393,000
26,836,200
21,388,501
320,081,874
271,482,690
60,492,920
6,219,273
122,016,357
221,588,222
41,995,951
4,438,625
(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 36,212,609 (31.12.2022: 21,845,052 TL) 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
Current Period
Prior Period
6,219,273
4,438,625
Deposits and Other Accounts of the Chairperson and Members of Board of Directors, Chief Executive Officer, Senior
Executive Officers and their Relatives
77,781
39,447
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
Other
Total
652,109,439
236,155,743
344,848,140 329,306,884
65,661,766
81,965,006
4,842
1,710,051,820
b.
Negative Differences on Derivative Financial Liabilities Held for Trading:
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
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
Residents in
Turkey
259,519,298
44,938,425
142,216,242
14,994,589
6,031,447
21,436,452
1,332
489,137,785
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
635,114
322,705
1,698,660
56,837
400,126
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
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 31.12.2023, the amount of the foreign exchange-protected deposits opened within this scope is TL 279,584,133 (31.12.2022:
129,809,134 TL).
Derivative Financial Liabilities at Fair Value
through Profit/Loss (1)
Current Period
Prior Period
TL
FC
TL
FC
Forward Transactions
Swap Transactions
Futures
Options
Other
Total
184,450
413,616
796,917
5,677,628
115,054
2,910,812
601,553
6,050,298
4,211
1,117,558
34,799
244,575
602,277
7,592,103
3,060,665
6,896,426
(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.
c.1.
Banks and Other Financial Institutions:
Information on banks and other financial institutions:
Funds borrowed from the CBRT
Domestic banks and institutions
Foreign banks, institutions and funds
Total
Current Period
Prior Period
TL
FC
TL
FC
6,579,759
3,508,820
10,088,579
7,068,265
224,083,749
231,152,014
9,536,923
2,564,571
12,101,494
8,805,823
135,074,282
143,880,105
404
405
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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
FC
TL
FC
7,320,155
2,768,424
10,088,579
13,300,977
217,851,037
231,152,014
9,704,698
2,396,796
12,101,494
8,339,020
135,541,085
143,880,105
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
July 2023
June 2023
Funds Borrowed
USD 17,500,000 + EURO 94,000,000
USD 224,000,000 + EURO 388,250,000
November 2023
USD 465,000,000 + EURO 411,000,000
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
November 2023
November 2023
Amount
Final Maturity
Remaining Debt Amount as at
December 31, 2023
EURO 125,000,000
EURO 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
USD 195,000,000
EURO 50,000,000
12 years
12 years
14 years
15 years
10 years
12 years
10-13 years
7 years
9 years
5 years
5 years
5 years
EURO 9,375,000
EURO 10,000,000
USD 100,000,000
USD 11,718,750
USD 48,387,500
USD 26,829,260
USD 64,005,715
USD 11,000,000
USD 77,380,952
USD 227,000,000
USD 195,000,000
EURO 50,000,000
Other Transactions:
d.
Information on Debt Securities Issued (Net):
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
100,418
648,076
2,726,586
3,475,080
60,323
489,502
1,747,689
2,297,514
54,887
546,849
1,857,601
29,467
390,839
1,222,747
2,459,337
1,643,053
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
169,976
169,976
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 23,489.83 (exact TL amount as of December 31, 2023),
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 5,643,824 as of December 31, 2023 (December 31, 2022; TL 5,605,220).
Main actuarial assumptions used in calculation of severance pay liability are as follows:
In the calculation, the discount rate is 23.58%, the inflation rate is 19.65%, and the real wage increase rate is 2%.
In the calculation, the ceiling of 24,489.83 TL (full TL amount) valid as of 31.12.2023 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:
Bills
Asset backed security
Bonds
Total
406
Current Period
Prior Period
TL
FC
TL
FC
6,165,382
1,508,031
2,642,046
10,315,459
735,314
10,463,791
98,092,794
98,828,108
164,426
895,529
46,820,814
11,523,746
46,820,814
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
5,605,220
432,431
1,216,303
(1,841,112)
2,642
239,358
(11,018)
5,643,824
2,424,212
194,109
452,379
(195,616)
9,837
1,941
2,718,358
5,605,220
407
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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 642,592 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, 2023. (December 31, 2022: TL
235,129)
i.4.3. 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.
Within the legal process, the individual application made by the Bank to the Constitutional Court did not yield a positive result and the negative declaration lawsuit filed for the
determination of the Bank’s non-debtor status was finalized against the Bank. Within the scope of the ongoing process, an agreement was reached with the SDIF by way of
mutual release and the total balance subject to the proceedings was paid to the SDIF in the amount of USD 48 million on 05.02.2024, and the necessary provision was made
in the financial statements as of 31.12.2023 for the entire amount.
i.4.4. 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 10,000,000 of which TL 8,475,000 provided in prior years and TL 1,525,000 was provided in the current period.
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, 2023, the
unused vacation provision amount is TL 530,788 (December 31, 2022: TL 288,519).
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, 2023, and December 31, 2022 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, 2023, TL 2.976.310 provision (December 31, 2022: TL 1.618.580) 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, 2023 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 14,288,742.According to the actuarial report as at December 31, 2023 of
Milli Reasürans T.A.Ş. besides the Parent Bank, the amount of actuarial and technical deficit was determined to be TL 339,283. 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 amount, 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, 2023, 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, 2023, 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
(57,235,905)
25,775,506
(31,460,399)
(6,190,532)
18,687,242
12,496,710
4,674,947
(14,288,742)
(30,350,164)
13,123,522
(17,226,642)
(2,986,675)
9,514,553
6,527,878
2,319,023
(8,379,741)
Current Period
Prior Period
3,366,702
604,264
703,981
4,674,947
1,240,842
742,714
335,467
2,319,023
408
409
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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, 2023, 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 9,361,158 (December 31, 2022 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 50,335 (December 31, 2022 TL 26,354) occurs.
Current Period
Prior Period
floating interest rates for qualified investors without being offered to the public in Turkey.
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
Other
Total
j.2.
Information on deferred tax liabilities:
9,361,158
1,050,214
10,422
2,091,978
40,098
261,828
773,056
6,356,595
439,514
8,285
823,231
52,378
114,629
269,451
13,588,754
8,064,083
Current Period
Prior Period
27,338
33,931
38,284
44
13,588
27,291
118
140,594
10,348
12,478
18,065
23
6,965
13,942
83
61,904
The Parent Bank and the consolidated Group companies have TL 114,193 deferred tax liability as of December 31, 2023. 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
Current Period
Prior Period
26,847
(115,856)
147,596
55,606
114,193
2,170,487
(7,697,538)
7,153,981
(27,547)
1,599,383
(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
Bank has issued subordinated debt securities, to be included in the contribution capital calculation, with the following nominal values;
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% (effective from June 29, 2023 with an interest rate of 9.192%) 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
Nominal value contribution capital has issued borrowing instruments that will be included in the calculation of bonds. The bills mentioned are amounting to TL 39,870,982 as
of December 31, 2023 (December 31, 2022 TL 33,558,745).
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
Toplam
m.
Information on consolidated shareholders’ equity:
m.1.
Presentation of paid-in capital:
Common shares
Preferred shares
Total
2,324,411
37,546,571
2,277,824
31,280,921
2,324,411
2,324,411
37,546,571
37,546,571
2,277,824
2,277,824
31,280,921
31,280,921
Current Period
Prior Period
9,999,970
30
10,000,000
9,999,970
30
10,000,000
m.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
25,000,000
m.3.
The capital increase made in current period: None
m.4. Capital increase through transfer from capital reserves during the current period: None.
Significant commitments of the Parent Bank related to capital expenditures within the last year and the following quarter, the general purpose thereof, and the
m.5.
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 Board of Directors
m.6.
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 into consideration the
m.7.
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.
410
411
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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 on Valuation
Foreign Exchange Differences
Current Period
Prior Period
TL
4,420,683
5,810,836
(1,584,704)
194,551
FC
(1,461,390)
(2,063,705)
602,315
TL
29,879,045
39,560,096
(9,768,524)
87,473
FC
(4,864,454)
(6,237,059)
1,372,605
Total
4,420,683
(1,461,390)
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
18,801,765
(346,380)
14,116,181
2,723,743
(135,638)
35,159,671
9,234,928
(226,322)
7,459,012
2,312,603
21,544
18,801,765
At the Bank’s Ordinary General Assembly, held on March 30, 2023, it was decided to allocate net profit from operating acitivities of 2022, amounting to TL 61,537,880
thousand as follows;
adding a total of TL 165,466 which is formed within the framework of various legislative regulations and is monitored in the profits of previous years,
the balance sheet profit based on distribution amounting to TL 61,703,346 formed accordingly, TL 204,246 arising from real estate sales gains, of which it was decided to
be used in capital increase, including the separation of TL 989 venture capital investment related to R&D discount, allocating a total of TL 476,341 as special reserves, of
which TL 272,095 is allocated to venture capital investment trusts and funds,
Addition of the provision amount of TL 3,093,000 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”,
of the amount as a basis for distribution of TL 64,320,005;
TL 9,230,643 to A, B and C group shares as cash,
TL 39 to the founding shares as cash,
TL 3,092,161 as cash dividend to employees to be distributed,
TL 51,997,162 as legal and extraordinary reserves to be reserved,
has been decided. As of March 30, 2023; TL 51,997,162 was transferred to reserves account, cash dividends were distributed to the shares other than the shares acquired by
the Bank, as of April 3, 2023.
Since the Bank’s Ordinary General Assembly Meeting for the year 2023 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.
III.
a.
DISCLOSURES AND FOOTNOTES ON CONSOLIDATED OFF-BALANCE SHEET ITEMS
Explanations to Liabilities Related to Off-Balance Sheet Items:
a.1.
Types and amounts of irrevocable loan commitments:
Commitment for customer credit card limits amounts to TL 417,894,567 and commitment to pay for cheque leaves amounts to TL 9,204,813. The amount of commitment for
the forward purchase of assets is TL 14,376,964 and for the forward sale of assets is TL 14,410,167.
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 2,976,310 as of December 31, 2023 (December 31, 2022: TL 1,618,580) 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
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
14,395,310
91,063,527
6,236,053
111,694,890
8,053,507
56,868,515
4,841,274
69,763,296
Current Period
Prior Period
6,461,015
185,238,771
43,825,683
14,947,470
69,327,517
319,800,456
2,855,259
109,153,663
21,968,649
9,508,835
37,266,219
180,752,625
Current Period
Prior Period
75,434,184
13,279,229
62,154,955
356,061,162
431,495,346
39,218,113
11,916,800
27,301,313
211,297,808
250,515,921
412
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Prior Period
(%)
FC
(%)
IV.
a.
DISCLOSURES AND FOOTNOTES ON THE CONSOLIDATED INCOME STATEMENT
Interest Income
a.1.
Information on interest income on loans:
Manufacturing Industry
50,226,268
29.76
123,233,517
46.90
25,722,487
28.09
77,110,974
a.6.
Sectoral risk concentration of non-cash loans:
Agriculture
Farming and Livestock
Forestry
Fishery
Industry
Mining and Quarrying
TL
915,302
790,750
112,662
11,890
63,734,022
2,224,842
Electricity, Gas, Water
Construction
Services
Wholesale and Retail Trade
Hotel and Restaurant Services
Transport and Communications
11,282,912
22,680,828
80,938,974
45,774,873
1,852,852
8,149,862
Self-Employment Services
Education Services
Health and Social Services
Other
Total
1,034,103
386,245
726,797
495,541
Current Period
(%)
0.54
0.47
0.07
0.00
FC
281,184
265,733
15,451
(%)
0.11
0.10
0.00
0.01
TL
612,476
490,047
107,093
15,336
0.67
0.54
0.12
0.01
82,994
44,531
38,463
37.77
145,952,470
55.55
33,356,650
36.43
89,881,397
1.32
1,825,487
0.69
1,003,885
1.10
763,041
6.69
20,893,466
7.96
6,630,278
7.24
12,007,382
13.44
40,429,597
15.39
10,052,780
10.98
24,651,767
47.96
69,580,248
26.48
47,177,829
51.53
43,029,313
27.12
30,578,217
11.64
27,079,113
29.58
20,274,689
1.10
808,327
4.83
19,334,249
2.40
0.61
0.23
0.43
0.29
3,438,762
216,365
8,671
478,625
6,487,180
0.31
7.36
5.60
1.31
0.08
0.00
0.18
2.47
1,283,859
5,338,287
9,689,863
2,320,371
812,991
111,558
541,787
357,507
1.40
5.83
914,027
11,961,045
10.58
7,869,063
2.53
0.89
0.12
0.60
0.39
1,546,769
142,340
6,549
314,831
1,313,208
Financial Institutions
18,971,238
11.24
14,717,032
Real Estate and Rental Services.
4,043,004
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
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
60,110,182
57,012,723
3,735,258
10,868,072
32,493,410
11,244
23,507,304
40,324,541
2,581,728
4,332,358
18,049,045
19,307
Total
120,858,163
43,372,726
66,413,573
22,400,710
(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
Current Period
Prior Period
TL
FC
TL
FC
2,707,515
88,128
38,987
125,451
811,649
737,608
39,480
52,130
134,658
228,800
2,795,643
976,087
777,088
415,588
168,764,667
100.00 262,730,679
100.00
91,557,242
100.00 158,958,679
100.00
a.3.
Information on interest income from securities:
a.7.
Non-cash Loans classified under Group I and Group II:
Non-cash Loans
Letters of Guarantee
Bank Acceptances
Letters of Credit
Endorsements
Underwriting Commitments of the Securities Issued
Factoring Related Guarantees
Other Guaranties and Warranties
b.
Information on derivative financial instruments:
Group I
Group II
TL
FC
TL
FC
166,749,625
251,376,202
157,049,582
150,809,088
9,434,550
261,037
4,960,260
89,411,585
1,745,582
1,745,082
500
5,539,815
4,869,725
670,090
Financial Assets at Fair Value through Profit and Loss
Financial Assets at Fair Value through Other Comprehensive Income
Financial Assets Measured at Amortized Cost
Total
Current Period
Current Period
TL
FC
TL
FC
76,557
39,363,179
30,675,940
70,115,676
398,697
6,410,969
1,392,378
102,873
23,120,222
17,828,194
8,202,044
41,051,289
192,371
3,804,326
549,041
4,545,738
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 2023, the Parent Bank’s pre-tax profit will increase by approximately TL 147 million (full amount) or decrease
by the same amount.
4,456
6,195,269
a.4.
Information on interest income received from associates and subsidiaries:
Interest Received From Affiliates and Subsidiaries
426,042
455,651
Current Period
Priod Period
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 48,032,693.
Due to the cheques given to the customers, the payment obligation amounting to TL 9,204,813, which was incurred as per the relevant legislation, was recorded in the
commitment accounts. In the event that checks submitted to their beneficiaries are dishonored, up to TL 6,000 (in exact TL amount) for checks subject to both the “Law on
the Regulation of Payments by Check and Protection of Check Holders” and the “Cheque Law” numbered 5941, within the framework of the relevant legislation, will be liable to
pay. The said amounts will be collected from the customers, and the uncollectible amounts will be followed in the “Compensated Non-Cash Loan Amounts” accounts.
d.
Explanations related to transactions made on behalf of or on the account of others:
It is explained in Note X under Section Four.
414
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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 (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
2,171,832
7,247,451
1,111,691
2,727,892
1,734,647
437,185
2,691
2,174,523
339,275
6,908,176
5,084,589
12,332,040
815,666
296,025
1,363
1,113,054
267,315
2,460,577
1,695,863
4,423,755
Interest Paid to Associates and Subsidiaries
2,027,892
447,325
Current Period
Prior Period
b.3.
Information on interest paid on marketable securities issued:
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
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
132,256
347,873
1,540,779
8,305,750
9,067,691
536,973
396,682
464
19,848,347
2,663
23,780
10
42
2
129
4,516,737
1,540,121
2,438,509
1,455,146
376,488
117,461
562,135
18,097
1,699
223
26,497
10,327,130
699,615
212
6,393,182
10,564,042
11,524,307
1,993,860
773,395
464
31,249,462
1,410
11,446
162,334
660,935
7,276
6,060
11
6,524
12,856
169,621
673,519
74,422
2,525
744
77,691
25,328
19,697
16,422
61,447
238,676
25,975
890
265,541
2
1,163,107
72,979
24,591
2
1,260,677
13,068
6,562,803
11,237,561
11,601,998
2,055,307
1,038,936
466
32,510,139
Current Period
Prior Period
TL
FC
TL
FC
c.
Explanations on dividend income:
Interest on Securities Issued
2,363,193
7,976,338
2,365,094
5,870,931
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
Financial Assets with Fair Value Differences Recognized in Profit/Loss
Financial Assets with Fair Value Differences Recognized in Comprehensive Income
Other
Total
d.
Information on trading profit/losses (Net):
TL
Bank Deposits
Savings Deposits
Public Sector Deposits
Other Institutions Deposits
Deposits with 7 Days Notice
Total
FC
Foreign Currency Deposits
Bank Deposits
Deposits with 7 Days Notice
Precious Metals Deposits
60
106
3,053,308
183,747
3,237,115
2,262,834
25,071,982
42,191,641
2,213,742
1,233,077
394
72,973,776
9,358
110,246
13,742
19
Commercial Deposits
1,450
17,597,878
5,894,130
9,843,852
3,233,704
1,469,119
759,413
1,703,750
607,223
13,205
137
133,365
38,040,133
3,083,728
1,616
23,682,791
32,963,855
52,656,458
5,460,670
2,702,333
394
117,468,117
1,067
1,334
399,023
1,103,961
564,935
49,029
43,998
69,281
181,824
79,635
910,559
439,974
7
3,161,376
683,251
5,623
11,030
10,569
520
27,742
Total
TOTAL
2,401
448,052
1,153,582
645,246
272,028
1,351,053
7
3,872,369
4,017
24,130,843
34,117,437
53,301,704
5,732,698
4,053,386
401 121,340,486
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
340,620
75,722
5,180
421,522
213,750
45,674
4,102
263,526
Current Period
Prior Period
2,507,981,258
1,808,795,913
229,156,069
80,995,783
2,197,829,406
2,467,236,519
211,227,197
81,931,866
2,174,077,456
40,744,739
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
(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)
e.
Information on other operating income:
As at reporting period, TL 38,547,396 of other operating income sources from inclusion and classification of operations of insurance and reinsurance companies; 90%
of which is from insurance premiums. (December 31, 2022: TL 18,824,865, 91%). The remaining balance consists mainly of expected loss provisions allocated for loans,
collections from loans in the 3rd stage and cancellations of free provisions allocated for possible risks in previous periods, collections from loans in the 3rd stage and fee
income obtained from customers in return for various banking services and fixed asset sales revenues. 2,000,000 TL of free provisions for possible risks in prior periods have
been reversed in the current period.
416
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Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
f.
Information on expected credit loss and other provision expense:
h.
Explanations on net profit / loss of continued and discontinued operations:
Current Period
Prior Period
The Group’s profit before tax arises from continuing operations. As of 31.12.2023, the profit before tax consists of TL 89,023,559 of net interest income, TL 40,133,066 of net
fees and commission income, and the total of personnel expenses and other operating expenses is TL 123,656,421.
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
19,759,355
2,059,578
5,615,275
12,084,502
1,935
824
1,111
13,055,945
1,209,566
1,963,033
9,883,346
91,472
18,954
72,518
h.1.
Information on provision for taxes from continuing and discounted operations
As of 31.12.2023, the Group’s tax provision amounting to TL 13,478,534 consists of current tax provision of TL 20,258,987 and deferred tax income of TL 6,780,453. The
Group does not have any discontinued operations.
h.2.
Explanations on net profit / loss of continued and discontinued operations:
The net profit of the Group from its ongoing operations as of 31.12.2023 is TL 86,369,954.
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 for January 1,
i.1.
2023-December 31, 2023.
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 commissions received from
i.3.
transactions such as credit card transactions, capital market transactions and insurance-reinsurance transactions.
4,628,282
24,389,572
6,083,658
19,231,075
i.4.
Net profit / loss of Minority Interest:
(1) The current period balance includes TL 3.525.000 free provision expense and TL 639.000 expense of the provision for litigation, details of which are disclosed in Note II.h.4.3 of Section Five.
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
760,336
6,013,017
142,047
2,000,702
464,172
2,416,955
4,587
1,136,163
1,425,520
912,870
7,403
923
33,675
378
31,020,238
12,629,150
499,200
981,110
1,805,980
27,733,948
9,081
51,632,349
93,011,616
217,764
550,271
808,529
11,052,586
4,361
24,569,241
42,171,552
(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 39,732,789 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, 2022: TL 20,610,199). In the current period, TL
2,488,465 of the “Other” item consists of cash donations made by companies included in the consolidation to the Disaster and Emergency Management Presidency (AFAD)
due to the earthquake, and TL 2,768,973 of it consists of taxes, duties, fees and fund expenses.
Net Profit / Loss of Non-controlling Interest
14,116,181
7,459,012
Current Period
Prior Period
j.
Explanation on other items in income statement
The main other income items in the income statement consist of other interest income, other fees and commission income disclosed in Note IV.ı.3 in Section 5, other operating
income disclosed in Note IV.d in Section 5 and profit/loss from equity accounted investees.
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
81,759
20,191
101,950
30,347
8,029
38,376
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 11,797,317 the balance of extraordinary reserves is TL
403,399 and the balance of statuary reserves is TL 98,659,463.
The details of revaluation surplus account of securities are shared in the Note Section V-II-l-9. TL (982,389) of this amount is the deferred tax effect on marketable securities
at fair value through other comprehensive income (December 31, 2022: TL (8,395,919)).
Foreign exchange differences amounting to TL 1.121.189 arising from net investment hedge accounting, details of which are explained in Note II.2 of Section Three, are
recognized under “Accumulated Other Comprehensive Income or Expenses Reclassified to Profit or Loss”.
418
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Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
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 86,645,439 before the changes in operating assets and liabilities mostly comprised of TL 211,263,314 of interest received from
loans and securities, and TL 143,037,374 of interest paid on deposits, money market transactions and funds borrowed by the Bank. An important part of other revenues,
TL 56,180,996 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 (22,429,632) (December
31, 2022: TL (13,421,662)).
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 160,819,031 (December 31, 2022: TL 63,388,101 increase).
The Net Cash Provided from Other Investing Activities account includes net cash flows from the sale of intangible assets and declined by TL 4,288,012 (December 31, 2022:
TL 2,756,163 decrease).
Foreign currency exchange differences on cash and cash equivalents are on the positive side TL 8.591.643 (31.12.2022 TL 975,670) as of December 31, 2023. 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.
a.
a.1.
Information on the volume of transactions relating to the Group’s risk group, incomplete loan and deposit transactions and period’s profit and loss:
Information on loans held by the Group’s risk group:
Current Period:
Group’s Risk Group
Investments in Associates,
Subsidiaries and Jointly Controlled
Entities (Joint Ventures)
Cash
Non-Cash
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
Loans
Balance at the beginning of the
period
Balance at the end of the period
Interest and commission income received
2,343,655
17,111,566
10,195,890
426,042
28,515,121
10,200
2,920,845
1,309,864
3,363,190
504,933
2,191,348
16,305
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:
Group’s Risk Group
Investments in Associates,
Subsidiaries and Jointly Controlled
Entities (Joint Ventures)
Cash
Non-Cash
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
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
114,144,588
96,316,663
14,862,587
81,454,076
36,005,939
2,950,824
33,055,115
132,322,602
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, 2023
December 31, 2022
325,236,461
30,877,622
294,358,839
72,058,144
7,811,536
64,246,608
397,294,605
79,788,516
15,828,672
63,959,844
34,356,072
6,101,378
28,254,694
114,144,588
420
Loans
Balance at the beginning of the
period
Balance at the end of the period
Interest and commission income received
2,402,860
16,824,670
2,343,655
455,651
17,111,566
5,747
a.2.
Information on deposits held by the Group’s risk group:
Current Period:
1,916,562
2,920,845
295,514
608,306
1,309,864
7,447
Group’s Risk Group
Deposits
Balance at the beginning of
the period
Balance at the end of the period
Interest expense on deposits
Prior Period:
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
Other Real Persons and Corporate
Bodies that have been Included in the
Risk Group
13,305,929
21,601,646
2,027,892
130,226
1,700,282
404,204
5,589,672
4,383,964
514,337
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
10,076,451
13,305,929
447,325
302,826
130,226
58,439
1,710,018
5,589,672
172,982
a.3.
Information on forward and option and other similar agreements made with the Group’s risk group:
Group’s Risk Group
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
Transactions for hedging purposes
Beginning of the period
End of the period
Total Profit/Loss
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
14,841,605
422,104
14,841,605
23,306
-1,400
421
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Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
b.
Disclosures for the Group’s risk group:
b.1.
The relations of the Group with corporations in its risk group and under its control regardless of whether there are any transactions between the 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 items, pricing policy
b.2.
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 1.04%, while the ratio to the overall
assets is 0.46% the ratio of deposits of the risk group corporations to the overall deposits is 1.62%, while the ratio to overall liabilities is 0.94%, 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 through research and
b.3.
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.
The Bank’s Private Banking and Commercial and Corporate Banking specialized branches are agencies of İş Portföy Yönetimi A.Ş.
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.
c.
Total salaries and similar benefits paid to the (executive members and senior executives)
In the current period, the gross payment provided to the key management of Group amounts TL 599,919 (December 31, 2022: TL 309,172).
VIII. DISCLOSURES ON THE GROUP’S DOMESTIC, FOREIGN, OFF-SHORE BRANCHES OR PARTICIPATIONS AND REPRESENTATIVE OFFICES
Milli Reasürans T.A.Ş.
Domestic Branches
Foreign Representative Offices
Foreign Branches
Off-Shore Branches
JSC İşbank
Domestic Branches1
Foreign Representative Offices
Foreign Branches
Off-Shore Branches
Number
Employees
1
1
1
Number
163
Country of Incorporation
Total Assets
Legal Capital
Singapore
1,185,349
973,213
11
95
Employees
Country of Incorporation
Total Assets
Legal Capital
The Parent Bank – Türkiye İş Bankası A.Ş
Domestic Branches (1)
1,066
20,809
Number
Employees
Foreign Representative Offices
Foreign Branches
1
1
2
15
2
2
1
3
2
53
214
45
35
6
Country of Incorporation
China
Egypt
England
TRNC
Iraq
Kosovo
Bahrain
Off-Shore Branches
(1) The Branches located in Free Trade Zones in Turkey are included among domestic branches.
(1) The branches of the company, which is headquartered in Moscow, in Russia are shown as domestic branches.
JSC İşbank Georgia
Domestic Branches1
2
58
Number
Employees
Country of Incorporation
Total Assets
Legal Capital
Foreign Representative Offices
90,022,049
59,129,476
14,377,299
4,574,098
19,109,630
3,750
80,000
1,395,743
325,698
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:
İşbank AG
Domestic Branches (1)
Foreign Representative Offices
Foreign Branches
Off-Shore Branches
Number
Employees
8
1
144
Country of Incorporation
7
Netherlands
2,623,721
Total Assets
Legal Capital
(1) The branches of the company, which is headquartered in Germany, in Germany are shown as domestic branches
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.
MAXİS GİRİŞİM SERMAYESİ YATIRIM ORTAKLIĞI A.Ş.
MAXIS INVESTMENTS LTD. (1)
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.
Employees
1,708
1,062
89
122
135
70
6
84
582
6
18
10
67
12
452
18
422
423
(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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Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
Notes To The Consolidated Financial Statement For The Year Ended
December 31, 2023
IX.
SUBSEQUENT EVENTS
Within the scope of the decision of the Board of Directors regarding the issue of debt instrument on August 23, 2023, the Parent Bank issued a financial bond with a nominal
value of TL 1,459,387 after December 31, 2023.
Within the scope of the decisions of the Parent Bank’s Board of Directors dated 23.11.2022, 14.06.2023 and 20.11.2023 regarding the issuance of debt instruments abroad,
financial bills and bonds with a nominal value of 285 million USD and 10 million EURO were issued abroad after 31.12.2023.
It has been decided to increase the Bank’s paid-in capital from 10,000,000 TL to 25,000,000 TL, entirely from internal resources (extraordinary reserves). Accordingly,
BRSA approval for the capital increase was obtained on 11.01.2024 and internal resources were transferred to the capital account. On 15.01.2024, the process regarding
the application made to the Capital Markets Board (CMB) is ongoing and the issuance of new shares and necessary registration procedures will be realized after the CMB
approval.
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
Rating
Outlook (*)
B3
B3
B3
Not-Prime
Not-Prime
B-
B
B
B
A+ (tur)
B
Positive
Positive
Positive
-
-
Stable
Stable
-
-
Stable
-
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
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
Support Rating
Financial Capacity Rating
Short-Term Priority Unsecured Debt Rating
Long-Term Priority Unsecured Debt Rating
The date when the credit ratings/outlooks of TSKB were last updated are given below:
Moody’s: 17.01.2024, Fitch Ratings: 22.09.2023
Rating
B3
B3
B3
B3(cr)
Caa1
Caa1
(P)B3
Rating
B-
B
B
B
AA
Ns
B-
B-
B
Outlook(*)
Positive
Positive
-
-
-
-
-
Outlook(*)
Stable
Stable
-
-
Stable
-
-
-
-
The dates when the Bank’s credit ratings/outlooks were last updated are given below:
(*) Outlook:
Moody’s: 17.01.2024, Fitch Ratings: 22.09.2023
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
“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.
Rating
Outlook(*)
B-
B
B
B
A+ (tur)
B-
Stable
Stable
-
-
Stable
-
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, 2023 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 13, 2023, is presented preceding the
consolidated financial statements.
II.
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.
The date when the credit ratings/outlooks of İş Finansal Kiralama A.Ş were last updated are given below:
Fitch Ratings: 26.09.2023
424
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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 Konut Kredisi Com Tr Danışmanlık A.Ş. for marketing of consumer loans,
ੵ Support services received from ATP Ticari Bilgisayar Ağı ve Elektrik Güç Kaynakları Üretim ve Pazarlama Ticaret A.Ş. regarding the transfer of right to
ੵ Support services received from KKB Kredi Kayıt Bürosu A.Ş. regarding the use of Anadolu Data Center hard disk space,
use software and documents,
ੵ Support services received from Austriacard Turkey Kart Operasyonları 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 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 Kurye Net Motorlu Kuryecilik ve Dağıtım Hizmetleri A.Ş. for delivery of credit card products to customer addresses,
ੵ Support services received from Loomis Güvenlik Hizmetleri A.Ş. for transporting cheques, promissory notes, other commercial papers and documents,
ੵ 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 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,
ੵ Support services received from R2 Servis Elektrik, Elektronik ve Bilgisayar Teknolojileri San. ve Tic. A.Ş. for maintenance of and running the Bank’s
ੵ Support services received from Hobim Arşivleme ve Basım Hizmetleri A.Ş. for printing and/or enveloping bank statements of the credit cards and
application on cash registers,
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 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 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 Ingenico Ödeme Sistem Çözümleri 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 Innova Bilişim Çözümleri A.Ş. regarding the use of virtual POS,
ੵ Support services received from Arabam Com İnternet ve Bilgi Hizmetleri A.Ş. for marketing of consumer loans,
ੵ Support services received from Infina Yazılım A.Ş. regarding purchasing, installation, and maintenance of software and support services to be rendered
ੵ Software development and maintenance services from Topkapı Danışmanlık Elektronik Hizmetler Pazarlama ve Ticaret A.Ş.,
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 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,
ੵ 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
ੵ Support service received from Faturalab Elektronik Ticaret ve Bilişim Hizmetleri A.Ş. for supplier financing needs,
ੵ Mepsan Petrol Cih. San. and Tic. A.Ş. for the operation and maintenance of the Bank application on the SLRs,
ੵ Consultancy service for procurement of resources for application and data management used in credit allocation processes from Prometeia SPA Center
Italy Istanbul Central Branch
426
427
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vant Legislation
Additional Information Provided Within the Scope of Rele-
vant 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
Güzide Meltem Kökden
Deputy Chairperson of the
Board of Directors
Deputy Chairperson of the Board of Directors of Türkiye İş Bankası A.Ş. Members'
Supplementary Social Security and Charity Fund Foundation
Hakan Aran
Board Member
Chairman of the Board of Trakya Yatırım Holding, Chairman of the Board of İşbank AG
Şebnem Aydın
Board Member
Member of the Board of Directors of Türkiye İş Bankası A.Ş. Retirement Fund Foundation
Gökhan Şen
Fazlı Bulut
Durmuş Öztek
Board Member
Board Member
Board Member
Coordinator at Ciner Cam, Coordinator at Ciner Grup
None
None
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
Ahmet Gökhan Sungur
Board Member
Sadrettin Yurtsever
Board Member
None
None
Independence declaration of Mr. Ahmet Gökhan Sungur
and Mr. Gökhan Şen, Independent Member of the Board
Mr. Ahmet Gökhan Sungur and and Mr. Gökhan Şen were 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 16.01.2023 was submitted
to the Board on the same date. The independence declaration of Mr.
Ahmet Gökhan Sungur and Mr. Gökhan Şen, who were elected as
Independent Member of the Board at the Ordinary General Meeting
dated 30.03.2023, 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,
ੵ 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
ੵ "Loans Monitoring" and "Retail Loans Follow-up" Regional
Directorates were merged as "Retail Loans Monitoring and Follow-
up Regional Directorates".
ੵ Disaster and Emergency Coordination Department was established.
ੵ The Information Security Department was transformed into an
Information Security Coordination Department reporting directly to
the General Manager.
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 2023. 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.
ੵ Companies within the İşbank group do not have any shares in the
Bank's capital.
ੵ The actions required with respect to the decisions made at the
Ordinary General Shareholders’ Meeting of 2023 were performed.
ੵ Mr. Gökhan Şen, a member of the Board of Directors of our Bank,
resigned from his position on 01.03.2024 due to his relocation
abroad. The new member to be elected to the Board of Directors
vacated by Mr. Gökhan Şen in accordance with Article 363 of the
Turkish Commercial Code will be submitted to the approval of our
General Assembly.
ੵ Article 5 of our Articles of Association titled Capital has been
amended in relation to the increase of our Bank's capital from TL
10,000,000,000,000 to TL 25,000,000,000,000 and the said
amendment has been registered on 01.03.2024.
ੵ Since the Board of Directors has not prepared a dividend
distribution proposal as of the publication date of the report, no
explanation regarding this issue is included in the report.
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
30.03.2023, a net allocation of 90,000 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 159,490 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 29,401 thousand.
Dividend Payments:
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.
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 2023
ੵ Financial Legal and Tax Management Consultancy was established.
ੵ The Agile Management Department was discontinued. The related
teams continue their activities within the Corporate Architecture
Department and Human Resources Management Department.
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Out with the Bank's Risk Group
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 2023, the loans extended to Group companies were all
below the regulatory risk limits
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.
Türkiye Sınai Kalkınma Bankası
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.
TSKB, which works for Türkiye's development and sustainable
growth, ranked in the lowest risk group with 6.9 points as a result of
a 1-point improvement in the Environmental, Social and Governance
(ESG) risk rating conducted by Sustainalytics, an independent
organisation specialised in its field, as of November 2023, and
maintained its 1st place position in Türkiye, rose to 9th place among
development banks in the world, and ranked among the top 10 banks
in the global banking sector. The corporate governance rating of
430
the Bank, which is also among the leading institutions in corporate
governance, increased from 9.59 to 9.66 out of 10 in the 2023
October period.
In 2023, TSKB secured USD 1.1 billion in funding, including funding
agreements signed with development finance institutions. In April
2023, the Republic of Türkiye signed a EUR 100 million "Climate
Finance Loan" agreement with the German Development Bank
(KfW) to be extended to TSKB. With this financing, TSKB will support
climate-focused investments in Türkiye. In addition to this funding,
the International Climate Initiative (IKI) will provide TSKB with a grant
of EUR 10 million. In May 2023, TSKB and the Austrian Development
Bank (OeEB) signed a new EUR 25 million loan agreement to finance
renewable energy and energy efficiency investments. In July 2023,
TSKB renewed its sustainability criteria-indexed syndicated loan,
which it had obtained in previous years, for the fourth time this year
with differentiated criteria. The USD 123 million loan agreement
signed on 19 July was successfully completed with the participation
of 9 banks from Europe, America, Asia and the Middle East, including
2 new participants, with a renewal rate of 113%. In 2016, TSKB issued
the first green/sustainable bond for Türkiye and the CEEMEA region
and in September 2023, TSKB issued its fourth sustainable bond
amounting to USD 300 million. With the participation of 70 different
investors, approximately 2.8 times the demand was collected and
40% of the investors were ESG-focused investors. In December
2023, TSKB added a new one to its innovative financing practices
with the vision of providing qualified support to Türkiye's sustainable
and inclusive development and signed a USD 155 million "Türkiye
Green Fund" loan agreement with the World Bank (IBRD) under
the guarantee of the Republic of Türkiye Ministry of Treasury and
Finance. On the other hand, TSKB, which continues to support
qualified investment projects for the redevelopment of earthquake
zones, signed a new financing agreement in this field in December
2023. Having secured USD 100 million in funding from the Islamic
Development Bank, TSKB continues to support ecosystem
restorative recovery. Again in December 2023, TSKB signed a
new USD 200 million loan agreement with the Japan Bank for
International Cooperation (JBIC) to finance renewable energy, energy
efficiency, water and waste management and advanced technology-
supported energy efficiency investments that serve the green
transformation of companies affected by earthquakes. This funding
agreement, which will provide a significant support to the qualified
development of our country through permanent green recovery
investments, was realised with the guarantee of the Republic of
Türkiye Ministry of Treasury and Finance.
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 share of the Bank's Sustainable Development Goals
(SDG) related loans in the total portfolio is 90 percent, while the
share of loans contributing to climate and environment-related SDGs
is 62 percent. In 2019, TSKB broke new ground and became the
first institution in the Turkish finance 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 joined the
Management Committee of IDFC, of which it has been a member
together with leading international development banks since 2011,
as the 10th member. In October 2022, the Bank became a signatory
to the Net-Zero Banking Alliance established by the United Nations
Environment Programme Finance Initiative (UNEP FI) and committed
to align its loan and investment portfolio with zero emission targets by
2050. In 2023, TSKB took decisive steps forward in its climate risks
roadmap and signed another pioneering practice by announcing its
"Approved Science-Based Greenhouse Gas Emissions Reduction
Targets". The Bank's emissions from its loan and investment portfolio,
which correspond to 53% of its total assets, and the operational
emissions reduction targets announced in previous years have been
approved by the Science Based Targets initiative (SBTi).
On 17 January 2024, Moody's affirmed TSKB's Adjusted Core and
Core Credit Ratings of "caa1" and Long-Term Foreign and Domestic
Currency Issuer Ratings of "B3" and revised the outlooks of the
ratings from "Stable" to "Positive" for TSKB, which had a consolidated
shareholders' equity of TL 22 billion and total assets of TL 181 billion
as of end-December 2023.
www.tskb.com.tr
İşbank Almanya
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 September 2023, the Bank had 149 employees
and EUR 1.7 billion in total assets and EUR 407 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 58 employees,
İşbank Georgia had total assets worth USD 166 million (GEL 444
million), and its shareholder equity amounted to USD 49 million (GEL
131 million) as of September 2023.
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 95 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 327 million (RUB 31,801 million)
and its shareholder equity was registered as USD 65 million (RUB
6,355 million) as of September 2023.
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 end-December 2023, the Company had consolidated assets
of TL 162.9 billion and shareholders' equity of TL 6.5 billion. As of
the aforementioned date, the Company's customer assets under
management in private pension and life insurance totalled TL 151.8
billion.
As of year-end 2023, Anadolu Hayat Emeklilik maintained its
leadership among privately-owned companies in the voluntary PPS
participant number and automatic enrolment PPS fund categories
and continued to be the company with the highest number of
participants with its private pension product "PPS 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 create added value in the
sector with its pioneering practices. In addition to its Sustainability
Equity Fund, carbon emissions, which it has continued to zero
since 2016, and its strong position in the BIST Sustainability Index,
431
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the amount of waste, and donates unused electronic devices to
the Koruncuk Foundation through electronic waste collection bins,
both reducing the amount of electronic waste and supporting a
project that contributes to society. The Company published its 2022
Sustainability Report prepared in accordance with GRI Standards on
its corporate website.
Anadolu Hayat Emeklilik, which is at the forefront with its activities
on gender equality and equal opportunities in the workplace, sets
an important example in the private pension and life insurance
sector with its female employment and special practices for female
employees. The ratio of female employees in the company is 59 per
cent. On the other hand, with the idea that gender equality starts with
language, the Company launched the "Equal Dictionary" application,
which automatically changes sexist words in sentences when using
Outlook, Word and Excel.
www.anadoluhayat.com.tr
Anadolu Sigorta
Leading organisation of the Turkish insurance industry
Anadolu Anonim Türk Sigorta Şirketi, one of Turkey's leading
insurance companies operating in non-life insurance branches,
generated TL 44.2 billion in premium production as of the end of
December.
As of end-December 2023, the Company has total assets of TL 56.4
billion and shareholders' equity of TL 12.2 billion on a consolidated
basis. In the 2023 Corporate Governance Rating Report prepared in
November, the Company's rating was raised from 9.57 to 9.59.
Anadolu Sigorta continues to be included in the BIST Sustainability
Index, which it joined in 2021. Anadolu Sigorta transparently shares
its performance in sustainability through sustainability reports and
CDP climate change declarations. The Company aims to increase its
portfolio in this area in the coming periods with innovative products
and services such as Wind and Solar Power Plant Insurance,
Individual Rooftop Solar Energy Panel Insurance and Electric Vehicle
Comprehensive Insurance to promote renewable energy investments
and low carbon emissions. In 2023, the electric vehicle insurance
portfolio grew by 100% compared to the previous year.
Anadolu Sigorta has established the Zero Waste system to reduce
the negative environmental impact of its operations and carries out
various activities in line with its paperless insurance target. With
campaigns on recycling paper waste, electronic waste and coffee
pulp, the Company raises awareness and ensures the participation of
its employees.
With regard to equality, which is one of the components of
sustainable development, Anadolu Sigorta has become a member
of the "30 Percent Club", which works internationally to increase
the ratio of female employees in the boards of directors and
senior management of companies to at least 30%, and whose
work in Turkey is undertaken by the Sabancı University Corporate
Governance Forum. In addition, our Company was also included in
the UN Women's (UN Women) Promise to Action programme, in
which 10 institutions from Turkey participate, and in which exemplary/
reference studies and road map suggestions will be developed in this
field.
www.anadolusigorta.com.tr
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.
As of September 2023, İş Leasing's consolidated assets amounted
to TL 48.4 billion, shareholders' equity to TL 7.2 billion and financial
leasing receivables to TL 21.8 billion.
In its latest report published on 26.09.2023, international credit rating
agency Fitch Ratings updated the Company's Long Term Local
Currency Credit Rating to B, Long Term Foreign Currency Credit
Rating to B and Shareholder Support Rating 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 compared to December 2022 of the previous year
and maintained its level of 9.29 out of 10.
www.isleasing.com.tr
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 2023, the Company
reached TL 1,386 million in assets with TL 94 million in shareholders'
equity and continues its operations with 67 employees. Moka,
which accelerated its monthly business volume with new business
partnerships in the current year, ranks 3rd in the payment institutions
market in terms of POS volume.
www.moka.com
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 consolidated assets
and shareholders' equity reached TL 73.1 billion and TL 15.3 billion,
respectively. As of December 2023,
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 2023, premiums generated abroad accounted for 15% of
the Company’s total premiums. Since 1994, the Company has been
supporting the arts and has a chamber orchestra.
www.millire.com
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.
Within the scope of the projects under development, 99% of the
Istanbul Finance Center project has been completed and the
construction and sales activities of the Üsküdar Altunizade (Litus
Istanbul) project are ongoing. The residential project to be built on
the land of Profilo Shopping Mall is expected to commence in 2024.
Tuzla Housing Project and Kasaba Modern Project in Ömerli are also
under development. Gayrettepe and Kadıköy Hotel projects are in the
planning stages.
www.isgyo.com.tr
İş Yatırım
A leading and pioneering investment house in capital markets
IS Investment Menkul Değerler A.Ş. provides brokerage, investment
advisory and corporate finance services for the trading of capital
market instruments in domestic and international markets. There are
9 publicly traded brokerage houses operating in the sector and the
Company is the only brokerage house listed in the BIST 100.
IS Investment's long and short-term national credit ratings were
affirmed by SAHA Kurumsal Yönetim ve Kredi Derecelendirme
Hizmetleri A.Ş. as AAA and A1+ with a stable outlook on September
14, 2023. As of September 2023, IS Investment's consolidated
assets and shareholders' equity amounted to TL 45.7 billion and TL
13.4 billion, respectively.
As of September 2023, İş Faktoring's total assets and shareholders'
equity amounted to TL 23.2 billion and TL 3.3 billion, respectively.
IS Investment stands out with a return on equity above the sector
average and a significant increase in market capitalization.
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. As of January
10, 2023, the Sustainability Committee was established and the
Sustainability Committee Charter was prepared. In 2023, a step was
taken to reduce the Carbon Footprint by measuring Greenhouse Gas
Emissions.
www.isfaktoring.com.tr
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 2023, the Company's total assets and shareholders'
equity amounted to TL 31.2 billion and TL 25.2 billion, respectively.
As a result of the review conducted by Saha Kurumsal Yönetim ve Kredi
Derecelendirme Hizmetleri A.Ş. in August 2023, the Company's Long-
Term National Rating (TR) was affirmed as AA, Short-Term National
Rating (TR) as A1+ with a stable outlook.
www.isyatirim.com.tr
İş Portföy (İş Asset Management)
Is Asset Management's client portfolio consists mainly of institutional
clients such as mutual funds, pension funds, venture capital funds,
real estate funds, insurance companies and foundations.
The size of the portfolio under management reached TL 338 billion
as of year-end 2023, with real estate mutual funds amounting to TL
9.2 billion and venture capital mutual funds to TL 6.3 billion.
It is one of the first asset management companies to establish a
venture capital fund in the sector and provides a successful return
performance to its participants.
Worldwide interest in thematic funds, whose portfolios consist
of investment instruments based on unique themes such as
environmental, social and corporate governance, sustainability, clean
energy, and digitalization, is growing exponentially. Defining 2021
as the 'Year of Transformation', Is Asset Management went beyond
classical approaches in formulating its investment strategies and
focused on the rapidly growing 'Thematic Mutual Funds', which
have investment strategies based on transformations in business
models, industries, economies or social norms. Is Asset Management
organizes its Thematic Funds under two main headings: 'Technology'
and 'Environmental, Social, Corporate Governance'. Under the
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investment opportunities in fast-growing sectors such as Block
Chain Technologies, Cyber Security Technologies, Digital Gaming,
Semiconductor Technologies.
Within the environmental, social and corporate governance theme, İş
Asset Management's Theme Variable Fund, İş Asset Management
Electric Vehicles Mixed Fund, and İş Asset Management Women in
Business Equity Fund, which supports gender equality in business
life and offers the opportunity to invest in companies that emphasize
women's employment, represent firsts in their respective fields. İş
Asset Management has also become one of the leading companies
in the asset management sector in the thematic and renewable
energy sectors with the İş Asset Management Electric Vehicles Mixed
Fund, İş Asset Management Renewable Energy Mixed Fund, İş Asset
Management Renewable Energy Venture Capital Mutual Fund, İş
Asset Management Renewable Energy Technologies Venture Capital
Mutual Fund and İş Asset Management Infrastructure Venture Capital
Mutual Fund.
www.isportfoy.com.tr
Software
Softtech
Experienced solution partner in information technologies
Founded in 2006 in Istanbul, Softtech is Turkey's largest software
company with more than 1,600 employees and an asset size
approaching TL 1 billion. In addition to its experience in the banking
and finance sector, Softtech develops customer-oriented solutions in
the domestic and international markets with its products in different
fields and undertakes initiatives to create new opportunities and
collaborations with a focus on technology. In addition to its offices in
Ankara and Cyprus, the Company has subsidiaries in Istanbul, San
Francisco and Shanghai, which follow and develop innovation on the
ground within the entrepreneurship ecosystem.
www.softtech.com.tr
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 Turkey to have two hospitals
accredited by the Joint Commission International (JCI) in terms of
quality management and has been re-accredited by JCI for the sixth
time as of November 2021.
www.bayindirhastanesi.com.tr
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.
As of September 2023, Şişecam Group realized 41% of its total
glass production in tons abroad and generated 64% of its total sales
revenues from exports from Turkey and from its facilities established
abroad. As of September 2023, Şişecam Group exported USD 814
million worth of products from Turkey to more than 150 countries.
Ranking among the world's and Europe's leading manufacturers in its
sector, Şişecam Group ranked between second and fifth in the world
and Europe in glass production, according to capacity size, as of the
end of 2023.
Ranking fourth in Europe and second in the world in terms of
soda production capacity, the Group is the world leader in basic
chromium sulfate production and ranks second in sodium bichromate
production. As of December 2023, Şişecam's consolidated assets
and shareholders' equity amounted to TL 267.4 billion and TL 146.4
billion, respectively.
In September 2023, Fitch Ratings affirmed the Company's credit
rating as "B" and revised its outlook from "negative" to "stable". In
Moody's assessment dated January 19, 2024, the Company's credit
rating was affirmed as "B3" and the outlook was revised from "stable"
to "positive".
In the list of Turkey's Top 500 Industrial Enterprises for the year 2022
compiled by ISO, Türkiye Şişe ve Cam Fabrikaları A.Ş. ranked 14th.
Şişecam's investment in natural soda ash in the US 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.
The architectural glass and energy glass investments in Mersin
are also ongoing and are expected to be commissioned in 2025.
In order to meet the need for soda ash, which will increase with the
completion of Şişecam's glass investments, from domestic resources,
it has been decided to increase the heavy soda ash capacity of the
Mersin Soda Ash plant by 175 thousand tons/year. The investment
cost, including working capital, is expected to be approximately
USD 125.3 million and is targeted to be commissioned in 2026. The
housing project to be built on the land of Profilo Shopping Mall is
expected to start in 2024, while Tuzla Housing Project and Kasaba
Modern Project in Ömerli are also under development. Gayrettepe
and Kadıköy Hotel projects are in the planning stages.
www.sisecam.com.tr
Platform
Topkapı
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 centre, internet, virtual
network VPN, satellite services, digitalisation solutions, security
products and e-transformation. With 272 employees as of December
2023, İşNet will continue to offer innovative, high value-added
solutions in line with sectoral needs with its investments in robotic
process automation system, internet of things, cyber security,
cloud and artificial intelligence, with the vision of being the "digital
transformation friend" of companies in the coming period.
www.isnet.net.tr
Facility Management
İşmer
İşmer has completed its efforts to ensure that its services are carried
out in accordance with ISO 9001 Quality Management System,
ISO 14001 Environmental Management System, ISO 41001 Facility
Management System and ISO 45001 Occupational Health and
Safety Management System standards and successfully passed
the 2023 audit. In addition to these four important certificates, the
Company also holds ISO 50001 Energy Management System and
ISO 27001 Information Security Management System certificates.
The company is the first 100% Turkish capital company that is a
member of TRFMA with 6 management system certificates.
www.ismer.com.tr
Topkapı Danışmanlık Elektronik Hizmetler Pazarlama ve Ticaret A.Ş.
operates with the aim of contributing to the development of the online
shopping sector in our country with its marketplace model that aims
to bring together companies of all sizes operating in Turkey, to provide
an improved experience supported by secure next generation
payment solutions by processing customer data in the most accurate
way and to develop cooperation models that will provide maximum
benefit to its stakeholders. The Company's branch in Kartal Manzara
became operational in October 2023.
In addition to solutions in payment systems, the company also
incorporates the Pazarama platform, which aims to bring an
innovative and different understanding to the e-commerce sector for
all stakeholders.
In August 2023, Hamurlabs, which offers ordering, inventory,
purchasing, payment, delivery and transportation, warehouse and
product management, and multi-channel sales integrations from a
single platform, was acquired by 20% in August 2023 as a result of
negotiations that started in 2022.
www.topkapidanismanlik.com.tr
Maksmarket
Founded in September 2022 in Istanbul with the aim of becoming
a reliable marketplace for commodity trade and pioneering the
digitalisation of commodity sectors, Maksmarket Danışmanlık
Elektronik Hizmetler Tic. A.Ş. launched Proemtia, a digital marketplace
platform that mediates the trade of industrial products, starting with
iron and steel products, in April 2023.
As of December 2023, Proemtia, which is the only platform that
brings together sellers and buyers of industrial products in different
parts of Turkey on a reliable platform, provides easy access to
products with certain quality standards, can meet the needs of
buyers and sellers at the same time in product exchanges, is
transparent, reliable and supports cooperation. As of December
2023, approximately 14 thousand buyer member companies and
more than 300 seller companies and approximately 1.5 billion TL
worth of transactions were mediated.
https://www.proemtia.com/
İmecemobil
At the beginning of 2023, Imecemobil Tarım Platformu Elektronik
Hizmetler Tic. A.Ş. was established. The company incorporates the
Imecemobil Platform, which provides meteorological information,
market price information and similar data to support farmers in their
agricultural work via mobile application, as well as financial planning
support to farmers, and provides access to our Bank's Group financial
products without going to the branch.
www. imecemobil.com.tr
434
435
Financial Reports and AnnexesLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate Citizenİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Direct and Indirect Subsidiaries*
Direct and Indirect Subsidiaries*
Changes in the Portfolio of Direct and Indirect Subsidiaries between 31.12.2022-31.12.2023
DIRECT SUBSIDIARIES
Name
Anadolu Hayat Emeklilik AŞ
Arap Türk Bankası
İş Finansal Kiralama AŞ
İş Gayrimenkul Yatırım Ortaklığı AŞ
İş Merkezleri Yönetim Ve İşletim AŞ
İş Net Elektronik Bilgi Üretim Dağ Tic A.Ş.
İş Yatırım Menkul Değerler AŞ
İşbank AG
JSC Isbank Georgia
JSC İşbank
Kredi Kayıt Bürosu AŞ
Kültür Yayınları İş Türk Anonim Şirketi
Milli Reasürans T AŞ
Moka Ödeme ve Elektronik Para Kuruluşu A.Ş.
Trakya Yatırım Holding AŞ
Türkiye Sınai Kalkınma Bankası AŞ
Türkiye Şişe ve Cam Fabrikaları AŞ
31.12.2023
Direct Share
"Bank’s Risk Group
Share Percentage"
63.89%
20.58%
30.43%
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%
51.06%
84.89%
20.58%
60.88%
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%
57.87%
INDIRECT SUBSIDIARIES
Name
Anadolu Anonim Türk Sigorta Şirketi
Anavarza Otelcilik A.Ş.
AT Finansal Kiralama AŞ
Batı Karadeniz Elektrik Dağıtım Ve Ticar
Bayek Tedavi Sağlık Hizmetleri Ve İşlet
Besco Bebek Gereçleri Dış. Tic. Ltd. Şti.
Camiş Ambalaj Sanayii AŞ
Camiş Egypt Mining Ltd Co
Camiş Elektrik Üretim AŞ
Camiş Madencilik AŞ
Casaba Yönetim İşl İmal İth İhr Paz Sağ
CJSC Brewery Pivdenna
Covision Medical Technologies Limited
Covision Medical Technologies Sanayi ve Tic. A.Ş.
Cromital SPA
Efes Varlık Yönetim AŞ
Enaş Enerji Yatırımları A.Ş.
Erişim Müşteri Hizmetleri AŞ
Gullseye Lojistik Teknolojileri A.Ş.
Hamurlabs Elektronik Hizmetler Yazılım Tic. A.Ş.
Inci Yenilenebilir Enerji Elektrik Üretim A.Ş.
Is Energy Investments BV
Is Energy Romania SRL
IS United Payment Systems Limited
İmecemobil Tarım Platformu Elektronik Hizm Tic 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.
İş Yenilenebilir Enerji Proje Yönetimi Danışmanlık A.Ş.
JSC Mina
Kanyon Yönetim İşletim ve Pazarlama A.Ş.
Kasaba Gayrimenkul İnşaat Taahhüt ve Ticaret A.Ş.
Levent Varlık Kiralama A.Ş.
Livewell Giyilebilir Sağlık Ürün Hizm. A.Ş.
Maksmarket Danışmanlık Elektronik Hizm Tic A.Ş.
Maxi Digital GmbH
31.12.2023
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%
0.00%
0.00%
0.00%
64.31%
50.00%
20.58%
65.00%
99.90%
100.00%
100.00%
99.70%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
20.00%
100.00%
100.00%
100.00%
50.00%
100.00%
100.00%
100.00%
%56.78
100.00%
100.00%
38.04%
100.00%
100.00%
50.00%
100.00%
100.00%
100.00%
95.00%
100.00%
436
437
Financial Reports and AnnexesLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate Citizenİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Direct and Indirect Subsidiaries*
Direct and Indirect Subsidiaries*
INDIRECT SUBSIDIARIES
Name
Maxis Girişim Sermayesi Portföy Yönetimi AŞ.
Maxis Investments Ltd.
Maxitech Inc.
Merefa Glass Company Ltd.
Miltaş Turizm İnşaat Ticaret A.Ş.
Mimas SolarPark Kft
Montenergy Alföld Kft
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.
Ödesis Finansal Teknoloji Girişimleri 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
Polat Enerji Yatırımları A.Ş.
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
Saint Gobain Egypt Trade LLC
Saint Gobain Glass Egypt SAE
Saint Gobain Mirrors Egypt SAE
SC Glass Trading BV
Sisecam Automotive Bulgaria EAD
Sisecam Automotive Germany GmbH
Sisecam Automotive Hungary Kft
Sisecam Automotive Romania SA
Sisecam Automotive Rus JSC
Sisecam Automotive Rus Trading LLC
Sisecam Automotive Slovakia S.R.O.
Sisecam Chemicals Resources LLC
31.12.2023
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%
0.00%
0.00%
0.00%
0.00%
0.00%
100.00%
100.00%
100.00%
100.00%
100.00%
50.00%
50.00%
100.00%
100.00%
100.00%
100.00%
97.22%
100.00%
100.00%
60.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
50.00%
25.50%
25.50%
100.00%
100.00%
50.00%
30.00%
30.00%
30.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
60.00%
INDIRECT SUBSIDIARIES
Name
Sisecam Chemicals Wyoming LLC
Sisecam Flat Glass Italy SRL
Sisecam Flat Glass South Italy SRL
Sisecam Glasspackaging Hungary Kft
Sisecam Investment B.V.
Sisecam UK Limited
Sisecam USA Inc.
Sisecam Wyoming LLC
Softtech (Shanghai) Technology Co. Ltd.
Softtech Ventures Teknoloji A.Ş.
Softtech Yazılım Teknolojileri Araştırma Gel. ve Paz. Tic. A.Ş.
Soli GES Enerji Sanayi ve Ticaret A.Ş.
Solvay Sodi AD
Solvay Şişecam Holding AG
Stockton Soda Ash Port LLC
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 Otomotiv A.Ş.
Şişecam Sigorta Aracılık Hizmetleri AŞ
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.
Yüzüncü Yıl Teknoloji Girişimleri A.Ş.
31.12.2023
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%
0.00%
0.00%
0.00%
0.00%
0.00%
60.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
51.00%
100.00%
100.00%
100.00%
50.00%
25.00%
25.00%
50.00%
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%
90.00%
100.00%
100.00%
100.00%
100.00%
70.00%
100.00%
88.74%
100.00%
98.42%
100.00%
100.00%
438
439
Financial Reports and AnnexesLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate Citizenİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Changes in Share Percentages in Subsidiaries
COMPANIES
Companies Entering the Bank’s Risk Group in
2023
Direct Share of İşbank
as of December 2022
Direct Share of İşbank
as of December 2023
Bank's Risk Group
Share Percentage as of
December 2022
Bank's Risk Group
Share Percentage as of
December 2022
REASON
Besco Bebek Gereçleri Dış. Tic. Ltd. Şti.
Hamurlabs Elektronik Hizmetler Yazılım Tic. A.Ş.
Inci Yenilenebilir Enerji Elektrik Üretim A.Ş.
Is Energy Investments BV
Is Energy Romania SRL
IS United Payment Systems Limited
İmecemobil Tarım Platformu Elektronik Hizm Tic A.Ş.
İş Yenilenebilir Enerji Proje Yönetimi Danışmanlık A.Ş.
Levent Varlık Kiralama A.Ş.
Mimas SolarPark Kft
Montenergy Alföld Kft
Ödesis Finansal Teknoloji Girişimleri A.Ş.
Sisecam UK Limited
Soli GES Enerji Sanayi ve Ticaret A.Ş.
Stockton Soda Ash Port LLC
Yüzüncü Yıl Teknoloji Girişimleri A.Ş.
Polat Enerji Yatırımları A.Ş.
Companies Whose Share Ratio Changed in the Bank's Risk Group in 2023
Anadolu Hayat Emeklilik AŞ
İş Finansal Kiralama AŞ
İş Yatırım Ortaklığı A.Ş.
Topkapı Danışmanlık Elektronik Hizmetler Pazarlama ve Ticaret A.Ş.
Türkiye Şişe ve Cam Fabrikaları AŞ
Companies Removed From the Bank's Risk Group in 2022
Convera Uluslararası Yazılım Arge Teknoloji Yatırımları A.Ş.
Koridor Inc.
M4 Otelcilik ve Turizm A.Ş.
Mikla Yiyecek ve İçecek A.Ş.
Nevotek Bilişim Ses Ve İletişim Sistemle
Nevotek Intercorporation
Nevotek Middle East FZ Limited Liability Company
Sisecam Resource Partners LLC
Sisecam Resources LP
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
62.00%
27.79%
0.00%
0.00%
50.93%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
Companies whose Titles Changed in the Risk Group of the Bank in 2022
Former Title
Sisecam Chemicals USA Inc.
Sisecam Glass Packaging Investment B.V.
440
New Title
Sisecam USA Inc.
Sisecam Investment B.V.
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%
63.89%
30.43%
0.00%
0.00%
51.06%
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
83.00%
58.24%
38.66%
100.00%
57.02%
100.00%
74.66%
40.09%
83.57%
95.37%
100.00%
100.00%
60.00%
74.00%
100.00%
20.00%
100.00%
100.00%
100.00%
50.00%
100.00%
100.00%
100.00%
50.00%
50.00%
100.00%
100.00%
50.00%
50.00%
100.00%
50.00%
Purchasing
Purchasing
Company establishment
Company establishment
Company establishment
Purchasing
Company establishment
Company establishment
Company establishment
Purchasing
Purchasing
Company establishment
Company establishment
Purchasing
Purchasing
Company establishment
Purchasing
84.89%
Transfer of shares purchased from the market and recognized under Financial Assets at Fair
Value Through Profit or Loss to the accounts of associates
60.88%
Transfer of shares purchased from the market and recognized under Financial Assets at Fair
Value Through Profit or Loss to the accounts of associates
38.04% Sale of shares of our Bank's group company to the stock exchange
90.00% Sale of shares of our Bank's group company
57.87%
Transfer of shares purchased from the market and recognized under Financial Assets at Fair
Value Through Profit or Loss to the accounts of associates
- Closing
- Sale
- Merger
- Sale
- Sale
- Sale
- Sale
- Closing
- Closing
Change of title
Change of title
441
Financial Reports and AnnexesLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate Citizenİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report İşbank Credit Ratings
Tax Breakdowns in the Countries where İşbank Operates
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:
The Bank has a Disclosure Policy that includes written policies for compliance with the public disclosure obligation and evaluation of the
accuracy, frequency and appropriateness of such disclosures. The Disclosure Policy adopted by the Board of Directors is available on
the Bank's website.
Credit Ratings Assigned by Rating Agencies to the Bank and Related Explanations:
Not
Görünüm(*)
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
B3
B3
B3
NP
NP
B-
B
B
B
A+ (tour)
b
Positive
Positive
Positive
-
-
Stable
Stable
-
-
Stable
-
The dates on which the Bank's credit ratings/outlook were last updated are given below:
Moody's 17.01.2024, Fitch Ratings: 22.09.2023
(*) 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.
As of FY2022, 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
Turkey
Singapore
England
Russia
Germany
Netherlands
Georgia
Bahrain
Kosovo
Iraq
45,588,636,999
16,105,898,032
20,777,931,512
27,715
21,426,246
-6,554,942
0
0
653,939,307
86,881,297
186,711,305
25,716,417
119,356,862
94,314,784
18,946,040
129,490,004
63,127,506
11,590,879
10,796,616
0
5,891,099
17,108,565
0
0
86,319,932
64,620,316
13,897,231
23,158,377
0
3,873,864
23,192,528
12
58
94
140
6
62
6
31
40
Vergilendirmede
Yetkili Ülke
Name of Constituent Entities resident in
the Tax Jurisdiction
Vergilendirmede
Yetkili Ülke
Vergilendirmede Yetkili Ülkede Yerleşik
Kurucu Tüzel Kişilerin Adı
1. Türkiye İş Bankası A.Ş.
1. Türkiye İş Bankası A.Ş. London Branches
2. Anadolu Anonim Türk Sigorta Şirketi
3. Anadolu Hayat Emeklilik A.Ş.
4. Efes Varlık Yönetim A.Ş.
5. İş Faktoring A.Ş.
6. İş Finansal Kiralama A.Ş.
7. İş Gayrimenkul Yatırım Ortaklığı A.Ş.
8. İş Girişim Sermayesi Yatırım Ortaklığı A.Ş.
9. İş Portföy Yönetimi A.Ş.
England
Russian
Federation
Georgia
Germany
2. Maxis Investments Ltd.
1. Joint Stock Company İşbank
1. Joint Stock Company Isbank Georgia
1. Isbank AG
Netherlands
1. Isbank AG Amsterdam Branch
Singapore
1. Milli Reasürans T.A.Ş. Singapore Branch
Bahrain
1. Türkiye İş Bankası A.Ş. Bahrain Branch
Turkey
10. İş Yatırım Menkul Değerler A.Ş.
Iraq
1. Türkiye İş Bankası A.Ş. Baghdad Branch
2. Türkiye İş Bankası A.ş. Erbil Branch
Kosovo
1. Türkiye İş Bankası A.Ş. Kosova Branches
11. İş Yatırım Ortaklığı A.Ş.
12. Maxis Girişim Sermayesi Portföy
Yönetimi A.Ş.
13. Milli Reasürans T.A.Ş.
14. Moka Ödeme ve Elektronik Para
Kuruluşu A.Ş
15. TSKB Gayrimenkul Yatırım Ortaklığı A.Ş.
16. Türkiye Sınai Kalkınma Bankası A.Ş.
17. Yatırım Finansman Menkul Değerler A.Ş.
18. Yatırım Varlık Kiralama A.Ş.
442
443
Financial Reports and AnnexesLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate Citizenİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report
Amendments to the Articles of Incorporation in 2023*
Corporate Memberships
ARTICLE
OLD
5
Capital
NEW
Capital
The Corporation has accepted the registered capital system
pursuant to the provisions of the Capital Market Law, and
adopted the registered capital system as per the Capital
Market Board permission dated 6.3.1997 and Nr.2683. The
maximum level of registered capital of the Corporation is TRY
10,000,000,000 (ten billion).
The Corporation has accepted the registered capital system
pursuant to the provisions of the Capital Market Law, and
adopted the registered capital system as per the Capital
Market Board permission dated 6.3.1997 and Nr.2683. The
maximum level of registered capital of the Corporation is TRY
25,000,000,000 (twentyfive billion).
The issued and fully paid capital of the Corporation is TL
10,000,000,000 (ten billion) and TL 1,000 of it is composed
of Group (A) shares each of which worth 1 Kurus, TL 29,000
of it is composed of Group
The issued and fully paid capital of the Corporation is TL
10,000,000,000 (ten billion) and TL 1,000 of it is composed
of Group (A) shares each of which worth 1 Kurus, TL 29,000
of it is composed of Group
(B) shares each of which worth 1 Kurus and TL
9,999,970,000 of it is composed of Group
(B) shares each of which worth 1 Kurus and TL
9,999,970,000 of it is composed of Group
(C) shares each of which worth 4 Kurus.
(C) shares each of which worth 4 Kurus.
The registered capital maximum level permission granted by
the Capital Market Board is valid between 2020 and 2024
(5 years). Even if the registered capital maximum level is not
reached by the end of 2024; the Board of Directors, in order
to be able to resolve for another capital increase after 2024, is
obliged to obtain permission from the Capital Markets Board
for the previously permitted or a new maximum level amount
and then obtain authorization from the General Assembly for
a new time period which shall not be more than five years.
Unless such authorization is received, a capital increase
cannot be made by a resolution of the Board of Directors.
The registered capital maximum level permission granted by
the Capital Market Board is valid between 2023 and 2027
(5 years). Even if the registered capital maximum level is not
reached by the end of 2027; the Board of Directors, in order
to be able to resolve for another capital increase after 2027, is
obliged to obtain permission from the Capital Markets Board
for the previously permitted or a new maximum level amount
and then obtain authorization from the General Assembly for
a new time period which shall not be more than five years.
Unless such authorization is received, a capital increase
cannot be made by a resolution of the Board of Directors.
The Board of Directors is authorized to increase the issued
capital by issuing registered shares up to the maximum level
of the registered capital in accordance with the provisions of
the Capital Market Law and the relevant legislation, whenever
it deems necessary.
The Board of Directors is authorized to increase the issued
capital by issuing registered shares up to the maximum level
of the registered capital in accordance with the provisions of
the Capital Market Law and the relevant legislation, whenever
it deems necessary.
However, no new shares can be issued unless all the issued
shares are sold and their values are collected.
However, no new shares can be issued unless all the issued
shares are sold and their values are collected.
All the shares of the Corporation are strictly
All the shares of the Corporation are strictly
required to be issued in return for cash; all of them must be
registered.
required to be issued in return for cash; all of them must be
registered.
*Bankamız kayıtlı sermaye tavanının 10.000.000.000 TL'den 25.000.000.000 TL'ye artırılması sebebiyle Ana Sözleşmenin 5. maddesi
tadil edilmiştir.
Foreign
The Institute of International Finance (IIF)
Institut International d’Etudes Bancaires (IIEB)
International Chamber of Commerce (ICC) Türkiye National
Committee - The Commission on Banking Techniques and Practices
UN Global Compact Network Türkiye
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)
Mobile Marketing Association - MMA Türkiye
Domestic
The Research Institute of Banking and Commercial Law
Block Chain Türkiye (BCTR)
Turkish Marine Environment Protection Association
(TURMEPA)
Foreign Economic Relations Board of Türkiye (DEİK)
DEİK Türkiye - Iraq Business Council
ERTA
Elginkan Community
Fintech Association (FINTR)
Global Relations Forum
İstanbul Foundation for Culture and Arts (İKSV)
Association of Corporate Communicators (KİD)
National Education Foundation
The Advertisers Association
Business Council for Sustainable Development(BCSD)
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
444
445
Financial Reports and AnnexesLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate Citizenİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report As of 31.12.2023, İşbank's Outstanding Loans Obtained from In-
ternational Financial Institutions
Numbers of Social Media Followers
International Financial
Institution
Date of
Signature
Amount
Maturity
(years)
Purpose of Extending Loans
European Investment Bank (EIB)
European Bank for
Reconstruction and Development
(EBRD)
PROPARCO
DFC (OPIC)
IFC
IFC
28.06.2012(1) € 75,000,000
09.05.2014
€ 200,000,000
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
03.08.2023*
$65,000,000
25.08.2022(1)
03.11.2023(1)
$76,000,000
$51,000,000
$80,000,000
$20,000,000
30.06.2020
€ 25,000,000
10.12.2014(1) $220,000,000
28.12.2017(1)
$105,000,000
$20,000,000
25.08.2022(1) $100,000,000
$67,000,000
14.12.2023
€ 20,000,000
PROPARCO
€ 35,000,000
Asian Infrastructure Investment
Bank (AIIB)
12.09.2022
$100,000,000
12
10
10
13
10
15
12
12
15
12
7
1
5
5
10
14
9
5
1**
3
5
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 of individuals and businesses in 11 provinces in the earthquake
zone
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 companies providing services and production with 11 provinces
in the earthquake zone
Financing of SMEs with female managers/owners
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
Financing of housing loans, including green mortgages conforming to IFC
energy efficiency criteria
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 of individuals, farmers, micro and small enterprises in 11 provinces
in the earthquake zone
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
*The total amount of the contract is 109 million USD.
** The IFC loan, which is provided within the scope of the IFC earthquake support package, has an option to extend the maturity of 2 times for 1 year.
Account
Followers
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
Türkiye İş Bankası A.Ş.
İşcep
İşcep
İşcep
İşcep
İşcep
Maximum
Maximum
Maximum
Maximum
Maximum
Maximiles
Maximiles
Maximiles
Maximiles
Maximiles
Workup
Workup
Workup
Workup
Workup
Maximum Genç
Maximum Genç
Maximum Genç
Maximum Genç
Maximum Genç
Total
Platform
Link
Number of
LinkedIn
Youtube
Twitter
Facebook
Instagram
Tiktok
LinkedIn
Youtube
Twitter
Facebook
Instagram
LinkedIn
Youtube
Twitter
Facebook
Instagram
LinkedIn
Youtube
Twitter
Facebook
Instagram
LinkedIn
Youtube
Twitter
Facebook
Instagram
LinkedIn
Youtube
Twitter
Facebook
Instagram
https://www.linkedin.com/company/isbankasi
https://www.youtube.com/c/işbankası
https://twitter.com/isbankasi
https://www.facebook.com/isbankasi
https://www.instagram.com/isbankasi/
https://www.tiktok.com/@isbankasi
-
https://www.youtube.com/c/iscep
https://twitter.com/iscepisbankasi
https://www.facebook.com/iscep
https://www.instagram.com/iscepisbankasi/
-
https://www.youtube.com/user/maximumkart
https://twitter.com/MaximumKart
https://www.facebook.com/maximum
https://www.instagram.com/maximumkart/
-
https://www.youtube.com/c/MaximilesKart
https://twitter.com/MaximilesKart
https://www.facebook.com/MaximilesKart
https://www.instagram.com/maximileskart/
https://www.linkedin.com/company/isbankworkup/
https://www.youtube.com/c/
Workup%C4%B0%C5%9FBankas%C4%B1
https://twitter.com/workupisbankasi
https://www.facebook.com/workupisbankasi
https://www.instagram.com/workupisbankasi/
-
https://www.youtube.com/c/maximumgenc
https://twitter.com/maximumgenc
https://www.facebook.com/maximumgenc
https://www.instagram.com/maximumgenc/
181,052
48,800
247,894
628,923
165,755
41,100
6,700
60,038
410,234
71,570
24,200
57,209
347,253
49,427
479
31,489
135,131
18,536
8,712
2,490
10,018
17,213
11,807
5,900
24,812
182,825
24,812
2,814,379
446
447
Financial Reports and AnnexesLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate Citizenİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Human Resources Data
Total Number of Employees
Number of Employees
Number of Employees Covered by Collective Bargaining
Agreements
2021
22,802
11,506
11,296
11,309
11,126
2022
23,309
11,782
11,527
11,455
11,266
2023
21,167
10,307
10,860
9,966
10,613
Female
Male
Female
Male
Number of Employees by Employment Type
2021
2022
2023
Full-time
Partial Time
Part-time
Part-Time
Total
Female
Male
Female
Male
Female
Male
Female
Male
11,393
11,285
11,647
11,501
10,166
10,829
112
11
1
0
0
0
127
10
1
0
7
16
133
14
0
0
8
17
22,802
23,309
21,167
Total
Number of Employees by Region and Branch
2021
2022
2023
Head Office
Branch
Region
Total
448
Female
Male
Female
Male
Female
Male
2,928
4,155
8,240
6,728
338
413
3,249
4,313
8,220
6,814
313
400
22,802
23,309
3,037
4,091
6,979
6,369
291
400
21,167
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
Employees in Management Positions
(Division Manager and above)
50 years of age and older
30-50 years of age
30 years of age and younger
Breakdown of Employees by Age
50 years of age and older
30-50 years of age
30 years of age and younger
Female
Male
Female
Male
Female
Male
Female
Male
Female
Male
Female
Male
Female
Male
Female
Male
Female
Male
2021
2022
2023
3
16
0
5
0
0
4
18
0
4
0
0
4
15
1
5
0
0
2021
2022
2023
8
29
8
37
0
0
82
7
32
10
35
0
0
84
9
34
10
27
0
0
80
2021
2022
2023
203
483
10,686
10,228
617
585
350
611
10,340
9,932
1,092
984
Total
22,802
23,309
225
467
8,567
8,816
1,515
1,577
21,167
449
Financial Reports and AnnexesLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate Citizenİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Human Resources Data
Number of Employees by Seniority
2021
2022
2023
Total Employment Created with Subsidiaries
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
Female
Male
Female
Male
Female
Male
804
805
1,793
1,521
8,909
8,970
22,802
2.01
2021
44
3,299
523
17,815
1,100
21
1,229
1,129
1,761
1,469
8,792
8,929
23,309
1.9
16.05
2022
36
3,125
528
18,470
1,128
22
22,802
23,309
1,813
1,747
1,668
1,375
6,826
7,738
21,167
1.63
8.36
2023
17
2,120
500
17,387
1,122
21
21,167
Number of Employees Eligible for Parental Leave
2021
2022
2023
Number of Employees Eligible for Parental Leave
Number of female employees
Number of male 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
11,506
11,296
2021
592
758
99.87%
98.18%
550
11,782
11,527
2022
499
692
99.71%
98.55%
443
10,307
10,860
2023
373
507
99.80%
99.13%
341
Number of Subsidiaries Under Our Control
Number of Employees in Subsidiaries
Female
Male
Employee Trainings *
Average Annual Training Hours Per Employee
Average Annual Training Hours Per Female Employee
Average Annual Training Hours Per Male Employee
2021
109
35,973
2022
113
39,184
35,973
39,184
2021
29.3
26,7
32.7
2022
43
39.5
47.5
2023
154
39,947
13,787
26,160
2023
56.5
54.1
59.4
* Training figures exclude participants of refresher trainings, and Private Security Officers and Servant Staff are also not included
Employee Trainings*
2021
2022
2023
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
Diversity and Inclusion /Gender Equality Training/Other Diversity
Trainings
Number of Trainees
Person*Hours
International Sanctions Trainings
Number of Trainees
Person*Hours
5,716
627
2,214
1,305
272
727
8,637
14,392
775
388
-
-
-
-
17,015
2,130
2,700
1,480
2,019
4,887
12,291
27,994
2,110
981
-
-
-
-
19,889
2,667
4,227
2,849
2,524
6,034
12,800
24,764
2,035
654
8,106
14,654
2,894
649
450
451
Financial Reports and AnnexesLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate Citizenİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report Human Resources Data
Summary Financial Highlights and Key Ratios
for the Five-Year Period
2021
2022
2023
İş Sağlığı ve Güvenliği Verileri
2021
2022
2023
0.000079 0.000045 0.000121
Female
0.00006
0.00002 0.000013
Male 0.000019 0.000025 0.000108
Occupational Health and
Safety Data
Injury Rate
Direct Employment
Contractor Employees
Female
Male
Female
Male
Occupational Disease Rate
(ODR)
Direct Employment
Contractor Employees
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
Female
Male
Female
Male
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
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
1.98
1.49
0.49
0
0
0
444
335
109
0
0
0
1.12
0.5
0.62
0
0
0
263
118
145
0
0
0
3.05
0.33
2.71
0
0
0
639
70
569
0
0
0
Absentee Rate (AR)
Direct Employment
Contractor Employees
Contractor Employees
Direct Employment
Contractor Employees
Female
Male
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
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
46
32
14
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
61
39
22
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
97
45
52
0
0
0
Accident Frequency Rate*
Direct Employment
Female
Male
Number of Employees Carrying
Out Tasks with a High Risk of
Occupational Diseases
Direct Employment
Contractor Employees
0.2
0.14
6
0.26
0.17
0.09
0.46
0.21
0.25
0
0
0
0
0
0
* Accident frequency rate: Total number of incidents /
(Total working hours - Lost hours)*200,000
NON-CONSOLIDATED
ASSETS (TL Thousand)
Cash
Receivables from Banks and Interbank Money
Markets (1)
2019/12
2020/12
2021/12
2022/12
2023/12
5,661,559
9,463,666
15,170,894
16,145,165
31,650,948
60,525,991
77,492,256
190,881,628
205,819,117
535,111,258
Securities (Net) (2)
Loans (3)
84,246,760
109,485,041
142,653,302
278,281,335
472,417,535
270,360,084
345,150,130
493,378,191
759,289,191
1,147,371,176
Partnership Investments (Subsidiaries and Affiliates)
(Net)
21,070,554
26,002,383
39,461,345
79,859,474
144,453,136
Fixed Assets (Net)
Other Assets (4)
Total Assets
8,478,257
9,161,214
11,277,602
22,312,006
42,170,034
17,716,266
17,147,742
33,746,062
46,616,380
80,609,212
468,059,471
593,902,432
926,569,024
1,408,322,668
2,453,783,299
LIABILITIES (TL Thousand)
2019/12
2020/12
2021/12
2022/12
2023/12
Deposits
295,922,002
368,876,491
595,628,376
931,077,289
1,662,178,694
Funds Borrowed and Money Markets (5)
86,102,534
116,407,089
181,993,730
173,427,490
352,303,828
Provisions
Other Liabilities
Shareholders' Equity
Total Liabilities
7,042,357
10,224,590
15,487,318
30,539,092
39,920,879
20,119,113
30,612,810
46,620,309
81,902,722
131,582,414
58,873,465
67,781,452
86,839,291
191,376,075
267,797,484
468,059,471
593,902,432
926,569,024
1,408,322,668
2,453,783,299
INCOME/EXPENSE ITEMS (TL Thousand)
2019/12
2020/12
2021/12
2022/12
2023/12
Interest Income (6)
Interest Expenses (6)
Net Interest Income
Net Trading Profit/Loss
43,042,350
42,516,332
60,904,343
123,454,753
222,485,981
23,183,222
17,274,293
29,963,074
48,251,300
155,412,822
19,859,128
25,242,039
30,941,269
75,203,453
67,073,159
(6,397,400)
(3,341,357)
(5,149,127)
4,522,593
12,223,362
Net Fees and Commissions Income
5,569,128
5,617,613
7,619,945
16,146,898
42,437,948
Dividend Income
Other Operating Income
Total Operating Income
Operating Expenses (7)
9,098
21,487
20,735
38,604
65,258
3,146,751
2,436,205
4,401,570
6,080,548
13,586,616
22,186,705
29,975,987
37,834,392
101,992,096
135,386,343
9,792,544
11,796,986
15,911,689
34,029,278
72,228,962
NET OPERATING PROFIT/LOSS (8)
12,394,161
18,179,001
21,922,703
67,962,818
63,157,381
Provision for Losses on Loans and Other Receivables
8,325,906
12,729,920
14,450,167
15,804,444
20,070,907
Profit/Loss from Subsidiaries Based on Equity Method
2,806,196
3,406,471
8,003,345
21,790,674
33,996,027
PROFIT/LOSS BEFORE TAXES
6,874,451
8,855,552
15,475,881
73,949,048
77,082,501
Provision for Taxes
NET PERIOD PROFIT/LOSS
806,864
2,044,635
2,007,986
12,411,168
4,817,703
6,067,587
6,810,917
13,467,895
61,537,880
72,264,798
**Sustainability E-Trainings and Diversity and Inclusion / Gender Equality
Training / Other Diversity Trainings data are included.
452
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for the Five-Year Period
Summary Financial Highlights and Key Ratios
for the Five-Year Period
NON-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)
2019/12
2020/12
89.0%
109.0%
18.0%
57.8%
91.4%
23.6%
6.5%
54.7%
28.4%
12.6%
17.9%
1.4%
11.4%
39.2%
89.8%
109.9%
18.4%
58.1%
93.6%
25.0%
5.6%
63.7%
41.7%
11.4%
18.7%
1.3%
10.9%
35.3%
2021/12
89.3%
106.4%
15.4%
53.2%
82.8%
22.2%
4.1%
66.2%
47.9%
9.4%
20.4%
1.9%
18.4%
34.7%
2022/12
2023/12
88.2%
112.4%
19.8%
53.9%
81.5%
23.3%
3.0%
74.4%
45.5%
13.6%
24.4%
5.3%
46.8%
27.5%
87.7%
106.8%
19.3%
46.8%
69.0%
29.1%
2.1%
75.6%
38.5%
10.9%
21.6%
3.8%
33.3%
42.6%
OTHER INFORMATION (TL Thousand)
2019/12
2020/12
2021/12
2022/12
2023/12
Regulatory Capital
Core Capital
Free Capital (12)
Demand Deposits
69,198,849
84,540,460
116,325,684
229,090,694
318,987,884
57,971,231
66,666,192
90,161,889
192,857,543
266,416,068
30,903,681
38,469,439
46,673,837
120,650,947
142,552,115
84,040,178
153,998,446
285,308,452
423,357,161
640,611,013
(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.
(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.
(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)
CONSOLIDATED
ASSETS (TL Thousand)
Cash
Receivables from Banks and Interbank Money Markets (1)
2019/12
5,700,435
70,109,172
2020/12
2021/12
2022/12
2023/12
9,504,086
15,230,787
16,263,472
31,839,900
87,017,464
206,978,744
230,772,584
588,002,168
Securities (Net) (2)
97,304,703
128,082,066
173,820,212
342,656,590
557,699,316
Loans, Factoring Receivables and Lease Receivables (3)
316,028,505
403,934,870
590,297,628
885,150,975
1,350,352,203
Partnership Investments (Subsidiaries and Affiliates) (Net)
11,190,991
13,052,096
21,918,409
42,870,444
Fixed Assets (Net)
Other Assets (4)
Total Assets
LIABILITIES (TL Thousand)
Deposits
13,826,688
50,891,344
14,706,181
19,101,836
41,497,115
61,855,500
97,056,457
156,220,389
273,949,487
565,051,838
718,152,263
1,124,404,073
1,715,431,569
2,954,742,571
2019/12
2020/12
2021/12
2022/12
2023/12
302,791,204
381,693,393
617,679,203
952,635,932
1,710,051,820
81,346,534
71,552,963
Funds Borrowed and Money Markets (5)
130,065,019
167,635,067
272,909,829
299,862,793
529,450,660
evet
Other Liabilities
Shareholders' Equity
Total Liabilities
17,860,585
24,027,066
35,609,317
67,292,475
107,633,317
48,633,563
69,935,017
102,037,545
185,587,676
304,249,934
65,701,467
74,861,720
96,168,179
210,052,693
303,356,840
565,051,838
718,152,263
1,124,404,073
1,715,431,569
2,954,742,571
INCOME/EXPENSE ITEMS (TL Thousand)
2019/12
2020/12
2021/12
2022/12
2023/12
Interest Income (6)
Interest Expenses (6)
Net Interest Income
Net Trading Profit/Loss
Net Fees and Commissions Income
Dividend Income
Other Operating Income
Total Operating Income
Operating Expenses (7)
NET OPERATING PROFIT/LOSS (8)
Provision for Losses on Loans and Other Receivables
Profit/Loss from Subsidiaries Based on Equity Method
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)
48,453,830
47,960,977
69,449,187
140,591,973
257,253,164
25,654,752
22,799,078
(4,633,920)
4,611,770
20,819
18,898,262
32,530,364
54,160,597
168,229,605
29,062,715
(1,206,769)
4,919,413
31,057
36,918,823
86,431,376
89,023,559
703,452
6,691,855
68,548
19,477,788
14,671,415
263,526
40,744,739
40,133,066
421,522
10,942,888
11,733,929
16,883,690
32,573,886
64,136,738
33,740,635
44,540,345
61,266,368
153,417,991
234,459,624
17,512,911
16,227,724
9,236,283
1,462,479
8,453,920
1,422,289
7,031,631
21,179,158
30,381,409
59,881,644
123,656,421
23,361,187
30,884,959
93,536,347
110,803,203
14,150,040
16,810,490
19,231,075
24,389,572
1,455,956
10,667,103
2,915,351
7,751,752
4,874,850
10,205,448
13,434,857
18,949,319
84,510,720
99,848,488
3,389,061
15,453,038
13,478,534
15,560,258
69,057,682
86,369,954
2019/12
2020/12
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%
2021/12
86.2%
108.9%
2022/12
84.2%
115.4%
15.5%
50.9%
92.6%
19.3%
4.1%
65.0%
47.3%
8.6%
18.7%
1.8%
19.2%
34.5%
20.0%
49.7%
89.4%
20.8%
3.1%
75.6%
45.3%
12.2%
21.8%
4.9%
48.1%
27.5%
2023/12
84.2%
111.2%
18.9%
44.1%
76.3%
25.7%
2.3%
75.2%
38.1%
10.3%
19.9%
3.8%
35.6%
40.3%
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for the Five-Year Period
Independent Auditor’s Report on the Annual Report of the
Board Of Directors
OTHER INFORMATION (TL Thousand)
2019/12
2020/12
2021/12
2022/12
2023/12
To the General Assembly of Türkiye İş Bankası Anonim Şirketi
Regulatory Capital
Core Capital
Free Capital (12)
Demand Deposits
75,055,619
90,577,700
125,734,035
237,561,370
332,472,141
60,581,141
69,037,761
93,801,462
198,553,596
275,684,291
31,093,535
38,572,660
46,881,642
119,423,191
143,197,495
86,043,036
157,339,437
291,867,150
431,703,325
652,109,439
(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.
(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.
(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; 404-2; 404-3
Principle 5- Business Development, Supply Chain
and Marketing Practices
204-1; 205-1; 3-1; 3-2; 3-3; 417-3
Principle 6- Community Leadership and
Participation
201-1; 413-1
Message from the General Manager,
Initiatives Supported in the Field of
Sustainability
Equal Opportunity, Diversity, Gender
Equality
Equal Opportunity, Diversity, Gender
Equality; Employee Health and Safety
Equal Opportunity, Diversity, Gender
Equality; Talent Management
Responsible Supply Chain Management;
Business Ethics
Initiatives Supported in the Field of
Sustainability; Financial Performance and
Profitability; Contribution to Social Welfare
Principle 7- Measurement and Transparent
Reporting for Gender Equality
405-1; 405-2; 3-1; 3-2; 3-3
Equal Opportunity, Diversity, Gender
Equality
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, 2023 –
December 31, 2023.
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, 2023 and December 31, 2023 dated February 13,
2024 on the unconsolidated and consolidated financial statements respectively, as at December 31, 2023 include a free provision at an amount
of TL 10,000,000 thousands of which TL 8,475,000 thousands was provided in prior years, TL 2,000,000 thousands reversed in the current
period and TL 3,525,000 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 13,2024 on the full set unconsolidated and consolidated financial
statements of the Group for the period of 1/1/2023-31/12/2023.
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.
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Reporting Guide
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.
Environmental Indicators
Total Energy Consumption (GJ):
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.
Güney Bağımsız Denetim ve Serbest Muhasebeci Mali Müşavirlik Anonim Şirketi
A member firm of Ernst & Young Global Limited
March 7, 2024
İstanbul, Türkiye
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.
In 2023, monthly natural gas consumption is calculated in cubic meters,
coal consumption in kilograms, and fuel oil and diesel consumption for
heating purposes in liters. Subsequently, natural gas consumption figures are
converted to kilowatt-hours (kWh) using the monthly lower calorific values
as indicated on the invoices. The total of these monthly consumptions,
converted to kWh, is then further converted to gigajoules (GJ) using the
specified conversion factor and added to the total energy consumption.
Reporting boundary for this KPI covers Türkiye operations of İş Bankası.
Greenhouse Gas Emissions:
Scope 1 Emissions (tCO2e)
Scope 2 Emissions (tCO2e)
Scope 3 Emissions (tCO2e)
It indicates the carbon equivalent of greenhouse gas emissions calculated in
carbon dioxide equivalent units throughout the reporting period, stemming
from energy consumption and refrigerant gases.
The greenhouse gas emissions resulting from the activities of Türkiye İş
Bankası have been calculated by Demir Enerji, a consultancy providing
services in the fields of Climate Change and Carbon Management, in
accordance with the Corporate Greenhouse Gas Accounting and Reporting
Protocol (The Greenhouse Gas Protocol: A Revised Corporate Accounting
and Reporting Standard).
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,
International business travels (Flight, Bus, Taxi),
Local business travels (Flight, Bus, Taxi),
Paper consumption,
Fuel consumption of private car used for business purposes.
*Reporting boundary for this KPI covers Türkiye 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 of Personnel Service Vehicles (liters).
Fuel Consumption of Personal Vehicles (liters).
Fuel Consumption of Company Vehicles (liters)
The personnel services encompass transportation for employees of the
General Directorate buildings (İş Kuleleri Tower 1, ATOM, TUTOM, and
ATLAS buildings) as well as shuttle services for branch/region staff. Fuel
consumption data is calculated taking into account the distance covered
within the route of the service vehicles provided by the transportation
company responsible for personnel transportation.
Personal vehicles include the usage of vehicles for business purposes by
employees working at the General Directorate buildings (İş Kuleleri Tower 1,
ATOM, TUTOM, and ATLAS buildings), as well as all branches.
Company vehicles encompass all vehicles within the Bank's fleet, including
transportation vehicles. Fuel consumption information is based on data
provided by the supplier company.
Total Water Consumption (m3)
Total network water consumption (m3)
Total rainwater consumption (reclaimed/reused water) (m3)
Total drinking water consumption (m3)
Total amount of wastewater (m3)
In Türkiye operations, locally provided network water and rainwater are
utilized. The reporting scope includes the total amount of water consumed
for various purposes. Water consumption is categorized into three distinct
categories: Network water, Rainwater, and Drinking water. The total network
water encompasses the amount of water purchased from municipalities or
other authorized suppliers such as ISKI. Consumption data is tracked from
invoices and credit top-ups on metered counters. Throughout the year,
consumption across all locations is monitored and reported.
For a small number of service buildings (78), where consumption quantities
cannot be directly determined, estimated consumption information has
been calculated based on the number of employees according to TS1258
standards.
Rainwater is collected via rainwater collection channels installed in the
General Directorate buildings, filtered, and then stored after which its
usage is measured and monitored by building management through meter
readings. Rainwater constitutes the amount of reclaimed/reused water.
Total drinking water refers to the amount of drinking water consumed in the
General Directorate buildings (İş Kuleleri Tower 1, ATOM, TUTOM). Drinking
water for these buildings is supplied through water tankers, bottled water,
and bottled water, and has been monitored since 2021. In service buildings
certified with ISO14001, drinking water is supplied through bottled and
container water. Water consumed in service buildings is not included in the
reporting scope.
The total amount of wastewater is calculated as the sum of network water
purchased and rainwater collected, which is then reused for various activities
and subsequently classified as wastewater.
Emission Intensities
Emissions per Employee (tCO2e/Number of Employees)
Emissions per Consolidated Asset Size (tCO2e/million TL)
Emissions per Consolidated Asset Size (tCO2e/million US dollars)
Emissions per Consolidated Net Profit (tCO2e/million TL)
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Reporting Guide
ੵ Emissions per Consolidated Net Profit (tCO2e/million US dollars)
The greenhouse gas emission intensity values calculated by dividing the
Bank's Scope 1 and Scope 2 greenhouse gas emissions by its consolidated
assets, total number of employees in Türkiye, and consolidated net profit
are included. The Bank's total assets and net profit are obtained from the
independently audited financial statements as of December 31, 2023.
IFC (International Finance Corporation) Performance Standards, EBRD
(European Bank for Reconstruction and Development) Performance
Requirements, Equator Principles. A Project Environmental and Social
Assessment Document is prepared for each project.
ੵ Field visits within the scope of Environmental and Social Risk
Assessment
Recycled total waste amount (tons)
Recycled Non-hazardous Waste Amounts
Recycled Hazardous Waste Amounts
Recycled Paper Waste Amount
Recycled Electronic Waste Amount
The total recycled waste amount consists of recycled non-hazardous waste,
recycled hazardous waste, paper waste, and electronic waste.
Under recycled non-hazardous waste, plastics, metals, and glass wastes
are evaluated. Under recycled hazardous waste, battery, fluorescent lamp,
battery, car battery, and toner cartridge wastes are evaluated.
Recycled paper waste indicates the amount of paper, cardboard, and carton
waste.
Reporting boundaries for waste include the ATOM, TUTOM, Tower-1, ATLAS
buildings, and branch buildings included in the ISO14001 environmental
management certification. Receipts from authorized recycling companies
have been taken into account in calculating the recycled waste amount.
Renewable Energy Portfolio of İş Bankası
The number of renewable energy projects financed in 2023, their
installed capacity, and the amount of credit provided to these projects.
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 2023 or before.
Talent Management Indicators
Average annual training hours per employee
Average training hours per female employee
Average training hours per male employee
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 2023 (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
The total installed capacity of renewable energy projects financed by İş
training time
Bankası.
Number of employees received "Information Security" training and total
In İş Bankası's portfolio in 2023, the following renewable energy projects
training time
are included:
Hydroelectric Power Plants (HPP)
Wind Energy Power Plants (WPP)
Biomass Energy Power Plants (BPP)
Solar Energy Power Plants (SPP)
Geothermal Energy Power Plants (GPP)
The total credit amount provided to renewable energy projects is determined
based on the total risk information by considering the sum of cash and non-
cash credit amounts disbursed by the Bank's Corporate Loans Allocation,
Commercial Loans Allocation, Retail Loans Allocation, and Project Finance
divisions.
During this process, in addition to the total credit amounts provided to
projects, the installed capacities of projects are determined based on the
credit allocation files of projects, which are referenced and updated annually.
The number of renewable energy projects encompasses the number of
financed power plants. In consortium structures, the bank's shares are not
considered when calculating the installed capacity, and the total installed
capacity information of the power plant(s) is reported.
Environmental and Social Risk Assessment Indicators
Number of financed projects subjected to Environmental and Social Risk
Assessment and risk categories
As detailed under the Responsible Finance section of Responsible Banking,
evaluations within the Environmental and Social Risk Evaluation Tool (ERET)
included projects with an investment amount of 10 million USD and above,
for which loans were allocated or contracted during the reporting year.
Projects undergoing ERET evaluation process are evaluated with reference
regulations such as national, environmental and international regulations,
“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 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 program training per
person
Management and leadership development programs are measured by the
number of training hours per person. The total training hours for managers
(holding the title of Assistant Manager II and above) participating in
management and leadership development programs during the reporting
period are calculated by dividing it by the number of employees holding the
title of manager (Assistant Manager II and above) as of December 31, 2023.
ੵ Hours of IT competence development trainings per person
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 2023.
ੵ Share of digital trainings in total trainings (%)
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.
Human Resources Indicators
Total Number of Employees
As of December 31, 2023, the total number of employees includes all
employees working in Türkiye İş Bankası's domestic and international
operations. Interns (high school and university interns) and employees
under subcontractors, as well as BASİSEN, T. İş Bank. A.Ş. Mensupları Emekli
ve Munzam Sandık Vakıfları, and employees assigned to domestic and
international subsidiaries, are not included in the total number of employees.
ੵ Breakdown of employees by gender and type of employment
As of December 31, 2023, the total number of employees includes all
employees working in Türkiye İş Bankası's domestic and international
operations. Interns (high school and university interns) and employees
under subcontractors, as well as BASİSEN, T. İş Bank. A.Ş. Mensupları Emekli
ve Munzam Sandık Vakıfları, and employees assigned to domestic and
international subsidiaries, are not included in the total number of employees.
Employee turnover rate (%)
Employee Turnover Rate is covering 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.
The Critical Personnel Turnover Rate is the ratio of the number of inspectors
and specialists who resign and leave their jobs during the year to the average
number of employees in these titles. The average number of employees is
calculated by dividing the total number of Bank employees finalized at the
end of each month (12 counts in total) by 12.
Rate of People Resigning Due to Retirement is the ratio of the number of
employees who retire and resign (excluding resignations due to investigation
and military service) during the year to the average number of employees.
The average number of employees is calculated specifically for this turnover
rate by dividing the total number of employees at the end of the current year
and the previous year by 2.
The number and percentages of female managers in junior, middle, and
senior positions (%)
It is the ratio of the total number of female employees holding managerial
titles (Assistant Manager II and above) as of December 31, 2023, to the
total number of employees holding managerial titles (Assistant Manager II
and above). The titles of Assistant Manager II and above include Assistant
Manager II, Other Managers, 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 2023.
Number of employees benefited from maternity leave
The number of employees entitled to maternity leave refers to the number
of female employees who have taken paid or unpaid maternity leave
during the reporting period. The number of employees returning from
maternity leave refers to the number of female employees who have
returned from paid or unpaid maternity leave during the reporting period.
Rate of employees returned from maternity leave (%)
The ratio of the number of female employees who returned from maternity
leave (paid or unpaid) during the reporting period to the total number of
female employees who had their return date from maternity leave (paid or
unpaid) within the reporting period.
Retention rate after maternity leave (%)
The post-maternity leave retention rate is defined as the ratio of female
employees who returned to work at İş Bankası after maternity leave and
were still employed at the end of the reporting period, calculated and
reported for the previous year instead of the reporting period. For the year
2023, the reported rate is the ratio of female employees who returned from
paid or unpaid maternity leave during 2022 and continued to work at the
Bank within 1 year from their return to work, to the total number of female
employees who returned from paid or unpaid maternity leave during 2023.
Number of employees benefited from paternity leave
The number of male employees who used paternity leave as part of
compassionate leave during the period from 01.01.2023 to 31.12.2023.
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 Türkiye.
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 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.
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Independent Assurance Report
ੵ Total Injury Frequency Rate (IR - Injury Rate)
ੵ Number of digital banking customers
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 day 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.
Other Indicators
ੵ Total amount of loan agreements signed with international financial
institutions within the sustainable framework for the year of 2023
In 2023, the amount of resources obtained through securitization
transactions based on bilateral agreements or transfer flows from
international financial institutions and international funds such as EBRD, IFC,
Proparco, and Green for Growth Fund (GGF) for the purpose of providing
special financing aimed at creating environmental and social benefits has
been verified.
The list of sustainability-themed credit agreements signed with these
institutions was obtained from the Financial Institutions Department, and the
relevant credit agreements and disbursement documents were reviewed.
Items such as date, signature, disbursement date, principal amount, interest
amount, and currency of the principal were examined in these agreements
and disbursement documents. The bank system screenshots of the relevant
loans were reviewed and compared with the screenshots of the amounts
reported to the Banking Regulation and Supervision Agency (BDDK) and the
Central Bank of the Republic of Türkiye (TCMB).
ੵ Number of customers
As of December 31, 2023, it includes all legal and natural person customers,
including individual customers who have accounts at İş Bankası but are
not active, as well as potential customers who have had a relationship with
the Bank (such as money transfers, loan applications, supplementary card
ownership, customer agency relationships), excluding canceled/inactive
customers and customers in default.
The unique number of individual customers who have successfully logged
in to any of the following channels - individual İşCep, commercial İşCep,
Maximum Mobil, Maximum İş Yerim, Nays, individual Internet Branch, or
Commercial Internet Branch - with their customer number and password
during the period from January 01, 2023, to December 31, 2023.
ੵ Number of mobile banking users
The unique number of individual customers who have successfully logged in
to any of the following channels - individual İşCep, commercial İşCep, Nays,
Maximum İş Yerim, or Maximum Mobil - with their customer number and
password during the period from January 01, 2023, to December 31, 2023.
ੵ Customer satisfaction score
ੵ Net promoter score
The indicator covers scores reflected in individual and commercial customer
experience surveys conducted by independent research companies during
the reporting period.
ੵ Paper savings through digitized processes (Number of pages printed)
In 2023, the paper savings information was determined taking into account
the number of pages of contracts issued with digital approval, the number of
letters sent via KEP messages, and the number of digitally signed receipts.
Since our bank's receipts are in A5 size, the number of digitally signed
receipts was divided by 2 for the standard A4 calculation. The number
of KEP messages was multiplied by 2 based on the average of 2 pages
per letter determined through the examination of samples. The figures for
digital approval and KEP messages were obtained from reports created for
monitoring these applications. The number of digitally signed receipts was
obtained through a database query.
ੵ Number of trees planted during the year within the scope of the project
carried out with the TEMA Foundation
Includes the number of trees which will be planted in 2023 in exchange
to the paper waste (papers belonging to the expired files collected from
archives) donated by İş Bankası to TEMA in between 1 March 2023- 31
January 2023. 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.
ੵ Number of graduates from “81 Students from 81 Cities” Project
conducted with Darüşşafaka
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.
ੵ Total amount of cash loans extended to the agricultural sector (billion TL)
The total amount of cash loans provided to the agriculture and livestock
sector in 2023 is included, covering both individual and commercial loans
falling under the NACE A code. The labeling and classification of loans in the
system have been reviewed and tested.
ੵ Number of ATMs
It includes the total number of ATMs owned by İş Bankası in Türkiye and the
Turkish Republic of Northern Cyprus (TRNC). The data for December 2023
from the Interbank Card Center has been taken into account for the analysis.
ੵ Number of accessible ATMs
Includes the total number of ATMs belonging to İş Bankası, located in
Türkiye and TRNC which are accessible to a wheelchair and/or includes a
headphone jack as of the reporting period.
ੵ Total amount of cash loans extended to the women entrepreneurs
In 2023, the total amount of financial support provided in Turkish Lira to
female customers among the SMEs (Small and Medium-sized Enterprises)
meeting the definition of SME by the Banking Regulation and Supervision
Agency (BDDK) has been verified and tested within the loans granted to
SMEs.
KPMG Bağımsız Denetim ve
Serbest Muhasebeci Mali Müşavirlik A.Ş.
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 2023.
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 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 thanks 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 and male employees
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
ੵ 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
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Independent Assurance Report
ੵ 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 CO2)
Scope 3 (ton CO2e)
Category 1: Purchased Goods and Services (resulting from paper consumption)
Category 5: Waste Generated in Operations
Category 6: Business Travel
Category 7: Employee Commuting
ੵ Electricity consumption (kWh)
ੵ Natural gas consumption (m3)
Electricity consumption (kWh)
Natural gas consumption (m3)
Fuel-oil consumption (lt)
Coal consumption (kg)
Diesel consumption (lt)
Total energy consumption (GJ)
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 - Blue (m3)
Total spring water consumption - Green (m3)
Total wastewater consumption - Gray (m3)
Amount of recovered/re-used water (m3)
ੵ Paper consumption (tons)
ੵ Amount of recycled paper (tons)
ੵ Amount (tons) and type of waste (electronic, domestic, paper, medical, total)
ੵ Amount (tons) and type of recycled hazardous waste (car batteries, batteries, fluorescent lamps, toner cartridges)
ੵ Amount (tons) and type of recycled non-hazardous waste (glass, metal, plastic)
ੵ Amount of electronic waste recycled
ੵ Emission intensities (per employee, per consolidated total assets, and per consolidated net profit
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 manage-
ment 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 en-
gagement 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 includ-
ing 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 present-
ed in the Selected Information, and applying analytical and other evidence gathering procedures, as appropriate. These procedures included:
䫿 Interviews with relevant staff at the corporate and business unit level responsible for providing the information in the Selected Information,
䫿 Using the Reporting Guidance of the Report to measure and evaluate the Selected Information,
䫿 Evaluating the design and implementation of key processes and controls over the Selected Information,
䫿 Re-performing, on a sample basis, the calculations used to prepare the Selected Information for the reporting period,
䫿 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 experi-
ence with, the sustainability performance of İş Bankası,
䫿 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,
䫿 Reading the information presented in the Selected Information to determine whether it is in line with our overall knowledge of, and experience with, the sustain-
ability 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. Conse-
quently, 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 2023 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 con-
nect 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,
Sorumlu Ortak
Şirin Soysal,
Partner
İstanbul, 8 March 2024
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Statement of Use
Use of GRI 1
İşbank has prepared its report covering the period January 1, 2023-December 31, 2023 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, p. 8-9
https://www.isbank.com.tr/bankamizi-taniyin/hakkimizda"
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, p. 470
2-4 Restatements of information
GRI Content Index: There is no restated information in the report
2-5 External assurance
Independent Assurance Report, p. 463-466
2-6 Activities, value chain and other business
relationships
"An Overview Of İşbank, p. 8-9
https://www.isbank.com.tr/bankamizi-taniyin/istiraklerimiz"
2-7 Employees
Human Resources Data, p. 448
2-8 Workers who are not employees
Responsible Supply Chain Management; p. 113-114
2-9 Governance structure and composition
Management Structure, p. 135-137
2-10 Nomination and selection of the highest
governance body
Management Structure, p. 135-137
2-11 Chair of the highest governance body
Management Structure, p. 135-137
2-12 Role of the highest governance body in
overseeing the management of impacts
Management Structure, p. 135-137
2-13 Delegation of responsibility for
managing impacts
Sustainability Management, p. 36-37; Management Structure, p. 135-137
2-14 Role of the highest governance body in
sustainability reporting
Sustainability Management, p. 36-37
2-15 Conflicts of interest
Management Structure, p. 135-137
2-16 Communication of critical concerns
2-17 Collective knowledge of the highest
governance body
2-18 Evaluation of the performance of the
highest governance body
2-19 Remuneration policies
2-20 Process to determine remuneration
2-21 Annual total compensation ratio
Our Stakeholders, p. 38-40; Internal Communication and Employee
Engagement; p. 126-127; Internal Audit, p. 159, Business Ethics, p. 164
Board Member Matrix, p.136-137
Management Structure, p. a 135-137
"Employee Rights, p. 120;
Remuneration Policy: https://www.isbank.com.tr/bankamizi-taniyin/
Documents/yatirimci-iliskileri/ucretlendirme-politikasi.pdf"
Remuneration Policy: https://www.isbank.com.tr/bankamizi-taniyin/
Documents/yatirimci-iliskileri/ucretlendirme-politikasi.pdf
GRI Content Index: İşbank currently discloses the total amount of benefits
provided to key executives, including members of the Board of Directors, in
the notes to the financial statements. These executives are the highest paid
individuals in the company. The ratio subject to the indicator is not disclosed
for confidentiality reasons.
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2-21 a; 2-21 b;
2-21 c
Confidentiality
constraint
İşbank does not
disclose this
information due to
confidentiality.
GRI 2: General
Disclosures 2021
2-22 Statement on sustainable development
strategy
Messages from the Executives, p. 16-21; Sustainability Management,
p. 36-37
2-23 Policy commitments
Initiatives Supported in the Field of Sustainability, p. 52-53
2-24 Embedding policy commitments
Sustainability Management, p. 36-37
2-25 Processes to remediate negative
impacts
Our Stakeholders, p. 38-40, Sustainability Management, p. 36-37
2-26 Mechanisms for seeking advice and
raising concerns
Internal Communication and Employee Engagement; p. 126-127;
Internal Audit, p.159, Business Ethics, p. 164
2-27 Compliance with laws and regulations
Internal Audit, p. 159; Uyum, p. 159-160; Internal Control, p. 160-161
2-28 Membership associations
Initiatives Supported in the Field of Sustainability, p. 52-53; Corporate
Memberships, p. 445
2-29 Approach to stakeholder engagement
Our Stakeholders, p. 38-40; Prioritization Process at İşbank, p. 41-42
2-30 Collective bargaining agreements
Key Performance Indicators, p. 117
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For the Content Index – Essentials Service, GRI Services reviewed that the GRI content index has been presented in a way consistent with the requirements for reporting in accor-
dance with the GRI Standards, and that the information in the index is clearly presented and accessible to the stakeholders. This service was performed on the Turkish version of the
report.
GRI STANDARD/
OTHER SOURCE
Material Topics
GRI 3: Material Topics
2021
DISCLOSURE
LOCATION
OMISSIONS
Requirement(s)
Omitted
Reason
Explanation
3-1 Process to determine material topics
Prioritization Process at İşbank, p. 41-42
3-2 List of material topics
Material Topics and Reporting Frameworks, p. 49
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Employee rights, commitment and satisfaction
GRI 3: Material Topics
2021
GRI 3: Material Topics
2021
3-3 Management of material topics
3-3 Management of material topics
Contribution to Sustainable Development Goals, p. 54-56; Employee
Loyalty and Satisfaction; p. 119; Employee Rights, p.: 120
Contribution to Sustainable Development Goals, p. 54-56; Employee
Loyalty and Satisfaction; p. 119; Employee Rights, p.: 120
401-1 New employee hires and employee
turnover
Key Performance Indicators, p. 117
GRI 401: Employment
2016
401-2 Benefits provided to full-time
employees that are not provided to temporary
or part-time employees
Employee Rights, p. 114
401-3 Parental leave
Human Resources Data, p. 450
GRI 402: Labor/
Management
Relations 2016
402-1 Minimum notice periods regarding
operational changes
GRI Content Index: In case of significant operational changes, legal
notice periods are complied with.
404-1 Average hours of training per year per
employee
Key Performance Indicators, p. 117
GRI 404: Training and
Education 2016
404-2 Programs for upgrading employee
skills and transition assistance programs
Talent Management, p. 128-129
404-3 Percentage of employees receiving regular
performance and career development reviews
Talent Management, p. 128-129
403-1 Occupational health and safety
management system
Employee Health and Safety, p. 127
403-2 Hazard identification, risk assessment,
and incident investigation
Employee Health and Safety, p. 127
403-3 Occupational health services
Employee Health and Safety, p. 127
GRI 403:
Occupational Health
and Safety 2018
403-4 Worker participation, consultation,
and communication on occupational health
and safety
403-5 Worker training on occupational
health and safety
Employee Health and Safety, p. 127
Employee Health and Safety, p. 127
403-6 Promotion of worker health
Employee Health and Safety, p. 127
403-8 Workers covered by an occupational
health and safety management system
Employee Health and Safety, p. 127
403-9 Work-related injuries
Human Resources Data, p. 452
403-10 Work-related ill health
Human Resources Data, p. 452
GRI 407: Freedom
of Association and
Collective Bargaining
2016
407-1 Operations and suppliers in which the
right to freedom of association and collective
bargaining may be at risk
Employee Rights, p. 120
Digital banking and innovation
GRI 3: Material Topics
2021
3-3 Management of material topics
Contribution to Sustainable Development Goals, p. 54-56; Digital
Banking, p. 93-96
Equal Opportunity, Diversity, and Gender Equality
GRI 3: Material Topics
2021
3-3 Management of material topics
Contribution to Sustainable Development Goals, p. 54-56; Equal
Opportunity, Diversity, and Gender Equality p. 123-124
405-1 Diversity of governance bodies and
employees
Human Resources Data, p. 449; Equal Opportunity, Diversity, and
Gender Equality p. 123-124
GRI 405: Diversity and
Equal Opportunity
2016
405-2 Ratio of basic salary and remuneration
of women to men
GRI 406: Non-
discrimination 2016
406-1 Incidents of discrimination and
corrective actions taken
"GRI Content Index: Remuneration is managed through transparent and
measurable processes and systems, and there is no gender-based wage
differentiation. Since there is no gender-based wage differentiation, this
ratio is 1.
Equal Opportunity, Diversity, and Gender Equality p. 123-124"
GRI Content Index: İşbank makes all decisions regarding its employees
regardless of race, origin, religion, language, sect or any other belief,
sexual orientation/preference, gender, mental or physical disability, age,
cultural or social class, and opinion/thought; and rejects all forms of
discrimination against or among its employees and managers.
466
467
Financial Reports and AnnexesLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate Citizenİşbank 2023 Integrated Annual Reportİşbank 2023 Integrated Annual Report GRI Content Index
GRI STANDARD/
OTHER SOURCE
Financial Inclusion
GRI 3: Material Topics
2021
DISCLOSURE
LOCATION
OMISSIONS
Requirement(s)
Omitted
Reason
Explanation
GRI STANDARD/
OTHER SOURCE
Contribution to Social Welfare
DISCLOSURE
LOCATION
OMISSIONS
Requirement(s)
Omitted
Reason
Explanation
3-3 Management of material topics
Contribution to Sustainable Development Goals, p. 54-56; Financial
Inclusion, p.: 75-78
GRI 3: Material Topics
2021
3-3 Management of material topics
Contribution to Sustainable Development Goals, p. 54-56; Contribution
to Social Welfare, p. 166-167
Financial Performance and Profitability
GRI 3: Material Topics
2021
3-3 Management of material topics
Contribution to Sustainable Development Goals, p. 54-56; Financial
Performance and Profitability, p. 61-62
GRI 201: Economic
Performance 2016
201-1 Direct economic value generated and
distributed
Value Creation Model p. 32-35 ; Financial Performance and Profitability,
p. 61-62
Climate Action
GRI 3: Material Topics
2021
3-3 Management of material topics
Contribution to Sustainable Development Goals, p. 54-56;
Climate Action p.: 80-81; Reducing Negative Impacts of
Operations, p. 108-109; Environmental Impact Management,
p. 112; Environmental and Social Impacts Policy: https://www.
isbank.com.tr/bankamizi-taniyin/Documents/surdurulebilirlik/
cevresel-ve-sosyal-etkiler.pdf
302-1 Energy consumption within the
organization
302-2 Energy consumption outside of
the organization
Key Performance Indicators, p. 109
Key Performance Indicators, p. 109
GRI 302: Energy 2016
302-3 Energy intensity
Key Performance Indicators, p. 109
302-4 Reduction of energy
consumption
Environmental Impact Management, p. 112; Environmentally
Friendly Service Points, p. 112
302-5 Reductions in energy
requirements of products and services
Environmentally Friendly Service Points, p. 112
GRI 303: Water and
Effluents 2018
303-3 Water withdrawal
Key Performance Indicators, p. 109
303-5 Water consumption
Key Performance Indicators, p. 109
305-1 Direct (Scope 1) GHG emissions
Key Performance Indicators, p. 109
305-2 Energy indirect (Scope 2) GHG
emissions
Key Performance Indicators, p. 109
GRI 305: Emissions
2016
305-3 Other indirect (Scope 3) GHG
emissions
Key Performance Indicators, p. 109
305-4 GHG emissions intensity
Key Performance Indicators, p. 109
305-5 Reduction of GHG emissions
Environmental Impact Management, p. 112; Environmentally
Friendly Service Points, p. 112
306-2 Management of significant waste-
related impacts
Environmental Impact Management, p. 112
GRI 306: Waste 2020
306-3 Waste generated
Key Performance Indicators, p. 109-110
306-4 Waste diverted from disposal
Key Performance Indicators, p. 109-110
Business Ethics, Transparency, Corporate Management
GRI 3: Material Topics
2021
3-3 Management of material topics
Contribution to Sustainable Development Goals, p. 54-56; Transparent
and Ethical Management, p.132-133
205-1 Operations assessed for risks related
to corruption
GRI 205: Anti-
corruption 2016
205-2 Communication and training about
anti-corruption policies and procedures
Business Ethics, p. 164, Anti-Bribery and Anti-Corruption, p. 165; Anti-
Bribery and Anti-Corruption Policy: https://www.isbank.com.tr/bankamizi-
taniyin/Documents/surdurulebilirlik/rusvet-ve-yolsuzlukla-mucadele.pdf
Business Ethics, p. 164, Anti-Bribery and Anti-Corruption, p. 165; Anti-
Bribery and Anti-Corruption Policy: https://www.isbank.com.tr/bankamizi-
taniyin/Documents/surdurulebilirlik/rusvet-ve-yolsuzlukla-mucadele.pdf
205-3 Confirmed incidents of corruption and
actions taken
Business Ethics, p. 164, Anti-Bribery and Anti-Corruption, p. 165; Anti-
Bribery and Anti-Corruption Policy: https://www.isbank.com.tr/bankamizi-
taniyin/Documents/surdurulebilirlik/rusvet-ve-yolsuzlukla-mucadele.pdf
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
468
"GRI Content Index: The Bank's Personnel Regulation includes 'being
over 18 years of age' among the recruitment conditions.
Activities Not Financed, p. 86; Responsible Supply Chain Management,
p. 112-113; Human Rights and Human Resources Policy: https://www.
isbank.com.tr/bankamizi-taniyin/Documents/surdurulebilirlik/insan-
haklari-ve-insan-kaynaklari.pdf"
GRI Content Index: The working conditions, economic and social
rights of employees at İşbank are determined within the framework
of labor legislation and internal regulations of the Bank as well as the
provisions of the Collective Bargaining Agreement. In this context,
the principle of freedom of labor and contract, which finds expression
in the Constitution, is valid at İşbank. Moreover, İşbank is among the
organizations with the highest unionized employee ratio in the sector
with 97.22%. Therefore, İşbank does not have any operations that carry
the risk of forced/forced labor.
GRI 203: Indirect
Economic Impacts
2016
GRI 413: Local
Communities 2016
Customer Centricity
GRI 3: Material Topics
2021
203-1 Infrastructure investments and
services supported
Financial Performance and Profitability, p. 61-62
203-2 Significant indirect economic impacts
413-1 Operations with local community
engagement, impact assessments, and
development programs
Financial Performance and Profitability, p. 61-62; Responsible Supply
Chain Management p. 113-114-115; Environmental and Social Risk
Management in Loans, p. 85-86
Environmental and Social Risk Management in Loans, p. 85-86
3-3 Management of material topics
Contribution to Sustainable Development Goals, p. 54-56; Customer
Centricity, p. 70-71
417-1 Requirements for product and service
information and labeling
Responsible Marketing, p. 72; Financial Literacy, p. 79
GRI 417: Marketing
and Labeling 2016
417-2 Incidents of non-compliance
concerning product and service information
and labeling
GRI Content Index: During the reporting period, there were no incidents
of non-compliance with regulations and rules regarding product and
service information and labeling.
417-3 Incidents of non-compliance
concerning marketing communications
GRI Content Index: During the reporting period, there were no incidents
of non-compliance with regulations and rules related to marketing
communications.
Efficient Risk Management
GRI 3: Material Topics
2021
3-3 Management of material topics
Contribution to Sustainable Development Goals, p. 54-56; Efficient Risk
Management, p. 161-162
GRI 201: Economic
Performance 2016
201-2 Financial implications and other risks
and opportunities due to climate change
Climate Action, p. 80; Climate Risks Management, p. 83-84
Cyber Security and Customer Privacy
GRI 3: Material Topics
2021
GRI 418: Customer
Privacy 2016
3-3 Management of material topics
Contribution to Sustainable Development Goals, p. 54-56; Information
Security, p. 102-103
418-1 Substantiated complaints concerning
breaches of customer privacy and losses of
customer data
GRI Content Index: The number of complaints is not shared due to data
confidentiality.
Responsible Purchasing and Supply Chain
GRI 3: Material Topics
2021
3-3 Management of material topics
Contribution to Sustainable Development Goals, p. 54-56; Responsible
Supply Chain Management, p. 113-114-115
GRI 204: Procurement
Practices 2016
204-1 Proportion of spending on local
suppliers
Highlights in 2023, p. 12; Key Performance Indicators, p. 106,
Responsible Supply Chain Management, p. 113-114-115
GRI 308: Supplier
Environmental
Assessment
2016
GRI 414: Supplier
Social Assessment
2016
308-1 New suppliers that were screened
using environmental criteria
308-2 Negative environmental impacts in the
supply chain and actions taken
414-1 New suppliers that were screened using
social criteria
414-2 Negative social impacts in the supply
chain and actions taken
Responsible Products and Services
Responsible Supply Chain Management, p. 113-114-115
Responsible Supply Chain Management, p. 113-114-115
Responsible Supply Chain Management, p. 113-114-115
Responsible Supply Chain Management, p. 113-114-115
GRI 3: Material Topics
2021
3-3 Management of material topics
Contribution to Sustainable Development Goals, p. 54-56; Responsible
Banking p. 72-73-74
GRI 304: Biyoçeşitlilik
2016
304-2 Significant impacts of activities,
products, and services on biodiversity
Environmental and Social Risk Management in Loans, p. 85-86
GRI 413: Local
Communities 2016
İnsan Hakları
GRI 3: Material Topics
2021
413-2 Operations with significant actual
and potential negative impacts on local
communities
Environmental and Social Risk Management in Loans, p. 85-86
3-3 Management of material topics
Contribution to Sustainable Development Goals, p. 54-56; Human
Rights and Social Impact Evaluations in Investment and Loan Activities,
p.: 74; Responsible Supply Chain Management, p. 113-114-115
The Future of Business and New Working Models
GRI 3: Material Topics
2021
3-3 Management of material topics
Contribution to Sustainable Development Goals, p. 54-56; The Future of
Business and New Working Models, p.121-122
469
Financial Reports and AnnexesLooking Into the FutureAn Overview of İşbankHow We Create ValueReliable Financial ActorResponsible OperationsGood Corporate Citizenİşbank 2023 Integrated Annual Reportİşbank 2023 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-mail: musteri.iliskileri@isbank.com.tr
Social Media Accounts
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