We Increased Our Assets by 19.6% in the First Half of the Year

Development and Investment Bank of Türkiye announced its financial results for the second quarter. During the period, the Bank increased its assets by 19.6% compared with year-end 2018 and by 74.1% compared with the same period of the previous year, reaching TRY 18.8 billion. Its loan book rose to TRY 15 billion.

The Bank increased its loan volume, which accounted for 79.8% of total assets, by 10% compared with year-end 2018 and by 65.3% compared with the same period of the previous year. It also achieved a decline in the ratio of gross non-performing loans to total loans, an important indicator of asset quality. The ratio decreased from 1.4% in the second quarter of 2018 to 0.8% in the second quarter of 2019.

As of June 2019, the Bank’s net interest income increased by 106.6% year-on-year to TRY 361.1 million, while operating income grew by 101.6% to TRY 381.4 million. The Bank recorded profit of TRY 229.7 million for the second quarter.

Global Economic Growth Slowed

Commenting on economic indicators alongside the balance-sheet announcement, TKYB CEO İbrahim Öztop said: “Although the global economy, particularly the economies of China and the United States, performed above expectations in the first quarter of the year, leading indicators show that economic activity slowed in the second quarter.”

Öztop listed the principal global developments affecting the economy during the period as the return of pessimism regarding US–China trade negotiations following the introduction of protectionist measures, financial volatility in emerging markets, and the possibility of slowing growth in advanced economies. Recalling that these developments caused international organisations to revise their global growth forecasts downwards, Öztop continued:

“In addition to trade and technology wars, the longstanding uncertainty surrounding Brexit also slowed economic activity in the first half of 2019, with emerging economies in particular delivering weaker-than-expected performance during the first six months. At its June meeting, the Federal Reserve kept its policy rate unchanged in the 2.25–2.50% range in line with market expectations. The following month, it reduced the policy rate by 25 basis points for the first time since 2008, again in line with market expectations, but stated that it did not see the need for a series of rate cuts. The European Central Bank postponed an increase in its policy rate until the second half of 2020 and indicated that it could use various policy tools in the short term to support the economy.”

Economic Activity Expected to Accelerate in the Second Half

Stating that economic activity, which contracted by 2.6% year-on-year in the first quarter of 2019, was expected to accelerate in the second half, Öztop continued:

“The foreign-trade deficit, one of the economy’s areas of vulnerability, declined by 60% in the second quarter of 2019, producing an improvement of USD 26 billion in the first six months. While the first-half outlook indicates that the rebalancing process in the Turkish economy is continuing, significant declines are also observed in external debt and the current-account deficit. These indicators strengthen expectations of a sound and robust economic recovery.”

We Focused on Financing Development in Line with the 2023 Objectives

Development and Investment Bank of Türkiye, which entered a transformation process to use modern development and investment banking instruments more effectively and expanded its activities to include investment banking, has supported development initiatives in every area needed by Türkiye since 1975. Referring to this development, Öztop said: “Having relocated to the financial centre of Istanbul in May and continuing its operations from its new headquarters, our Bank focuses on financing sustainable development in line with the 2023 objectives, guided by our Development Plan and the Sustainable Development Goals. Through the themes it develops and the resources it secures under its new organisational structure, Development and Investment Bank of Türkiye will continue supporting competitive and efficient production for a stable and robust economy.”