Celebrating its 150^th anniversary year, Ziraat Bank proceeded step by step in realizing its goals with the dynamism brought by reorganization. Ziraat Bank has worked intensively towards achieving the Bank’s transformation in Service for Bank Customers model which is shaped by “Customer Oriented Banking”, with the underlying motto in this transformation being “Together, to a Better Future”. In this respect, Ziraat Bank switched to a portfolio management system upon completion of customer and branch segmentation, in order to provide services to customers through accurate channels. The General Management, Regional and Branch Organization have been restructured in accordance with principles such as “division of powers” and “customer orientation”.

Branch and customer segmentation has been carried out in line with the one-to-one Customer Relationships Management study. Under the framework of customer orientation, branches have been diversified in order to meet different financial needs of the customers. The Bank switched to a customer representation model - in compliance with Portfolio Management principles - and a number of infrastructural IT projects have been completed in order to allow Bank to follow-up customer needs. Consequently, Ziraat Bank turned into a bank with the most extensive network which aims to meet all financial needs of the customers in a customer centric way.

Within the context of the project, the “Operations Center” was activated and operations gradually transferred to the Center in order to reduce operational density and simplify our services. An Individual Performance System started to be employed in parallel with the objective and transparent HR policies, which are at the heart of the motto of “Together, to a Better Future”.

In line with the “Together toward the Target” strategy, which marks the second stage of the reorganization, work on the corporate development projects continued unabated within Ziraat Bank and corresponding banks and branches abroad. The primary objective of “Together toward the target” is to ensure the transformation of customers from “Bank Customers” to “Ziraat Customers”, with the ultimate goal of ensuring all our partners and international branches operate efficiently, in compliance with our understanding of global banking under the “Ziraat” brand and serve our customers with the same quality of service in every country, and therefore, turn into a bank with a high brand and market value which operates on an international scale.

Infrastructural IT investments for our international partners and branches are carried out in alignment with our target, and basic banking systems are renewed. As a consequence of this work, the Bank became more prepared to tackle the competition in the sector and the volatility in the markets, and rounded off a successful performance in 2013, despite the challenges of the instabilities in the fluctuations.

Ziraat Bank increased its total assets by 27% YoY to TL 207.5 billion by the end of 2013. By re-establishing credit evaluation, allocation, management and risk appetite by institutionalizing these processes, the Bank achieved a record 55% increase in total credits and raised its total credit balance to TL 111 billion. Consequently, the ratio of credit in total assets was realized as 54%.

As one of the country’s most important assets, the Bank continued to increase its support for the real sector. The Bank realized this by strategically placing itself in the entrepreneurial customer segment, mainly in the SME segment. Additionally, the Bank is poised to continue adding value to the national economy by involving itself in investment and project financing operations in those sectors which are contributing to reducing the current account deficit.

Ziraat Bank is close to its customers in financing the agricultural sector and considers the growth and development of the agricultural sector as one of its primary objectives, helping the sector become competitive on a global scale. Being involved in every stage of the financing of agricultural production, agricultural industry and industrial production, the Bank strives for all players in this value chain, as part of the transformation process. In the agricultural industry Ziraat Bank is close to the customer in every stage of the production process from the ground to the shelf, starting from production right up to the sale and marketing of goods in both domestic and foreign markets, from the very first product to the end customers of the Bank. Anticipating that agriculture will be as important as energy as a business line, the Bank will remain a key supporter of the agricultural sector while increasing its efficiency and competitiveness.

Building its deposit resources on a solid basis, Ziraat Bank continued to fund its assets at low cost by concentrating on its deposit base in 2013. Deposits, which accounted for the highest weighting in assets, amounted to TL 141.7 billion. The share of demand deposits in total deposits reached around 20%. In order to extend funding maturities, the Bank purchased syndication loans for USD 700 million and placed priority on the issue of domestic bank bills and bonds during the process of diversification in the structure of resources.

Ziraat Bank completely renewed its Internet Branch. The New Generation Internet Branch is categorized according to customers’ various needs and received the Best in its Class award in the Financial Services category in the Interactive Media Awards, in view of its accessible homepage and user-friendly structure. This award, granted to Ziraat Bank’s New Generation Internet Branch, was also the first award given by the IMA to an Internet Branch in Turkey.

The Bank leads the sector in terms of the number of cards in circulation, with more than 20 million cardholders. In the framework of increasing the utilization of debit cards in shopping purposes, the Bank activated the Bankkart project which provides cash to cardholders whenever they spend using their Bankkart - the Bank’s own brand. The Bankkart was the first bank card to allow its holders to earn while both spending and saving.

The Bank opened 150 new branches in its 150^th year. The number of ATMs increased by 1,120 in 2013, with 243 added in the last quarter to reach a total of 5,353, helping the Bank meet customer’s demands more rapidly and efficiently.

The ratio of equity - amounting to TL 18.3 billion - in total liabilities stood at 8.9% at the end of 2013, with our Bank commanding a capital adequacy ratio of 13.2%. The main constituent of the equity was the net profit, which was realized as TL 3.3 billion in 2013, placing the Bank as the most profitable bank in the sector.

Performing well on the basis of many profitability and efficiency ratios including net interest margin and capital efficiency, the Bank realizes its aim with a dedicated project discipline and continues to work to generate value for customers and the country with its global banking vision and dynamic new structure.               

TÜRKİYE CUMHURİYETİ ZİRAAT BANKASI A.Ş.

Hüseyin AYDIN Member of Board of Directors and General Manager	Muharrem KARSLI Chairman of the Board of Directors

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