OUR COUNTRY, FULLY INTEGRATED INTO THE GLOBAL ECONOMY, HAS SUCCESSFULLY OVERCOME THIS CHALLENGING PERIOD THANKS TO THE DECISIONS AND SUPPORTING MEASURES TAKEN BY THE INSTITUTIONS MANAGING THE ECONOMY.
Alpaslan ÇAKAR
Member of the Board of Directors and General Manager
Dear stakeholders,
Before moving on to my assessments, I would like to express the deep sadness we all felt by the earthquake which struck Kahramanmaraş and its surrounding 10 provinces on 6 February 2023, causing devastating damage and loss of life. I wish God’s mercy on the souls of our colleagues and citizens who lost their lives as well as extending my condolences to their relatives and our country as a result of this disaster, which Ziraat Bank responded to immediately with action to heal the wounds caused by the disaster.
Geopolitical developments in 2022 usher in a new period of uncertainty and volatility all over the world.
The ongoing war in our surrounding region, the upward movement in global commodity and energy markets, the gathering inflationary environment on a global scale and the tight monetary policies implemented by the central banks of developed countries led to a deterioration in global growth expectations. These developments around the world have forced all countries to develop and implement policies and strategies which will establish a balance between inflation and growth.
Fully integrated into the global economy, our country has succeeded in managing this challenging and uncertain process with accurate and timely foresight, in line with the decisions taken by the authorities managing our economy and the supportive measures taken. In this process, the Turkish banking sector has prioritized the effective use of resources and has more intensely supported areas of strategic importance for our country.
Ziraat Bank boasts a strong capital structure, competent management, dedicated employees and a loyal customer base.
Ziraat Bank continues to increase its contribution to the country’s economy with a sense of responsibility.
Ziraat Bank boasts a strong capital structure, competent management, dedicated employees and a loyal customer base. This strong structure has brought sustainable growth. During 2022, the Bank focused on correctly interpreting the dynamics of the international and national markets, designed and implemented its future steps and maintained its strong balance sheet growth in 2022.
In this context, the Bank’s asset volume expanded by 68.6% to TL 2.3 trillion by the end of 2022, with the volume of cash loans increasing by 62.7% to TL 1.3 trillion in line with our selective loans-weighted growth policy. Our Bank generated a Return on Equity of 26.4% in 2022 with a Return on Assets of 2.3%.
We maintained our leadership in the sector in terms of total deposits in 2022, with a balance of TL 1.7 trillion in deposits, our main funding source. By increasing the share of TL deposits in total deposits with the Currency Protected Deposits and supporting TL-weighted financing of loans, we maintained the wide based structure of our deposits and contributed to our country’s savings and investment balance in a correctly adjusted and effective manner.
AS ZIRAAT BANK WE UNCOMPROMISINGLY IMPLEMENTED OUR SELECTIVE CREDIT POLICIES FOCUSED ON SUPPORTING THE REAL SECTOR AND INCREASING EMPLOYMENT THROUGHOUT 2022.
Commanding a prestigious position in the field of international banking thanks to the strong relations we have established with some of the world’s leading institutions
Ziraat Bank commands a prestigious position in international banking with its wide correspondent network, strong correspondent relations and solid funding base. With our high credibility, reliable and stable stance, we attracted a high volume of financing from a wide array of global banks and financial institutions in 2022.
The syndication loan we obtained in 2022 was not only the largest single transaction provided by a bank in our country but also our Bank’s first sustainability-themed syndication loan. The USD 1.24 billion, 367-day maturity loan was our Bank’s tenth borrowing transaction to be carried out through international markets by the syndication method.
In addition to the syndicated loan, we provided USD 8.9 billion in funds through alternative sources such as loans from International Financial Institutions, bilateral loan agreements, post-financing transactions, FX repo and Eurobond issues during 2022.
We also updated the USD 7 billion GMTN (Global Medium-Term Notes) program as of 5 May 2022.
We continued to support the real sector by adhering to our fundamental mission in all market conditions.
As Ziraat Bank, we uncompromisingly implemented our selective credit policies focused on supporting the real sector and increasing employment throughout 2022. In this context, we also contributed to the development of our country with the loans we extended to the agricultural, manufacturing, energy, investment and technology sectors as well as to our exporters.
We have based our strategy in the agricultural sector, which is one of our priority areas, on “Financing the Agricultural Ecosystem”. In 2022, we extended TL 205.3 billion of loans to 770,000 customers to finance the agricultural sector through our Bank’s resources. Investment loans accounted for 35% of our agricultural loan portfolio while business loans comprised a 65% share.
The balance of these loans had reached TL 232 billion at the end of the year with approximately 1 million of our customers having loans.
In 2022, we expanded the “I Have Many Reasons to Live in My Village” project, which we had initiated to support sheep and goat farming, to include cattle farming in 2022. With this project, which will continue in 2023, we aim to increase the scale of the producers with qualified animal breeds, to diversify the financial solution alternatives of small businesses and to increase the efficiency, productivity and profitability in this area.
We also prioritize support for SMEs, one of the most important drivers of production and employment. We have increased our support by designing product packages with preferential conditions for SMEs. In 2022, we launched a range of credit support packages for SMEs within the scope of cooperation with bodies such as KOSGEB (Small and Medium Enterprises Development and Support Administration), the KGF (Credit Guarantee Fund) and İGE (İhracatı Geliştirme A.Ş.). In addition, we have obtained sustainability-themed resources from various international financial institutions under favorable conditions to be used in financing the working capital and investment loan needs of SMEs.
In line with our working strategy which revolves around profitability and efficiency, we deliver our widening and diversifying range of products and services to all segments of the society.
Having built its strategy on the foundations of multi-faceted efficiency and effectiveness, our Bank took significant steps in fundamental areas such as business conduct, product diversity and service approach during 2022.
Providing services to a large mass of individual customers through our extensive branch network in retail loans, our Bank extended TL 47 billion in housing loans, TL 43 billion in consumer loans and TL 8 billion in vehicle loans in 2022.
In addition, in order to protect customers sensitive to exchange rate volatility and shield their Turkish Lira based investments from exchange rate risk, we launched the TL Currency Protected Time Deposits, FX Converted Currency Protected TL Time Deposits, YUVAM TL Time Deposits, Quarter Gold Coin Time Deposits and Quarter Gold Coin Demand Deposits.
We are constantly working to offer all kinds of transactions in banking services in a planned, predictable and integrated manner.
In 2022, we continued our intensive work focused on meeting the needs of an increasingly digital business world. We are constantly renewing and improving our business model in order to proactively identify customer needs through the effective use of data analytics.
The Ziraat Super Branch, which we launched in 2022 in this vein, allows our retail customers to access banking services through digital channels without having to go to the branch.
By the end of 2022, the number of our active digital banking customers had reached 19.4 million, with 94.1% of the financial transactions being realized through digital channels. In the same period, the number of our internet and mobile banking customers had increased by 14.8% to reach 31.5 million.
In addition to contributing to the efforts to resolve the climate crisis with the financing we provide for renewable energy and energy efficiency projects, we met 50,000 MWh of our Bank’s energy consumption from renewable resources in 2022.
Importance placed on Environmental, Social and Governance (ESG) activities in 2022
We intensively continued our efforts to leave behind a more livable world to future generations and carried out activities aimed at extending sustainability to all of our business processes.
In this respect, from March 2022, we started to evaluate loan requests for projects with investment budgets of over USD 50 million from an environmental and social point of view within the scope of the “Environmental and Social Impact Management Policy in Lending Activities”.
We continued to offer our “Green Home Loan” and “Green Vehicle Loan” products, which we introduced with the aim of diversifying our sustainable quality loans, while adding the “Housing Heat Insulation Loan” and “SPP/Roof SES/Licensed SPP Investment and Operation Loans” to these products in 2022.
We implemented improvements to our business processes in order to reduce environmental pollution and to save paper, sending 73 tons of waste IT products and 945 tons of waste paper to recycling facilities. In line with our goal of reducing our carbon footprint from electricity consumption, we are rapidly undertaking the necessary arrangements to our activities.
In addition to contributing to the efforts to resolve the climate crisis with the financing we provide for renewable energy and energy efficiency projects, we met 50,000 MWh of our Bank’s energy consumption from renewable resources in 2022. We have internationally documented this important step we took in the transition to the green transformation with the I-REC (The International REC Standard) certificate, which is the most widely used renewable energy certificate in the world.
We will continue our work in the coming years by increasing our contribution to our country’s economy.
Innovation, change, foresight and planning have an indisputable place in Ziraat Bank’s corporate culture. Acting with this awareness, we move our Bank forward with each passing period and transform the strength we derive from development into a competitive advantage.
We support the competence of our country’s economy to produce long-term sustainable value with our strong capital structure, qualified human resources and many years of experience, in addition to our range of products, services and solutions.
Our wide service network at home and abroad, our extensive product range and our customer-oriented service approach provides all segments of society with the opportunity to access financial services rapidly, wherever they wish, at the most optimal conditions.
Ziraat Bank is committed to taking further firm steps forward and to contribute to our country and its citizens in the coming periods, in line with our growth roadmap which we have determined with an innovative and versatile approach which is fully compatible with the conditions of the sector.
On behalf of myself and our Board of Directors, I would like to thank our human resources, who have been the architects of our success with their outstanding work in 2022, and all our stakeholders, especially our customers, for the trust and loyalty they have placed in the Ziraat brand.
