VKF_FRAE_2017

CONVENIENCE TRANSLATION OF PUBLICLY ANNOUNCED UNCONSOLIDATED FINANCIAL STATEMENTS ORIGINALLY ISSUEDIN TURKISH, SEE NOTE I. OF SECTION THREE TÜRKİYE VAKIFLAR BANKASI TÜRK ANONİM ORTAKLIĞI EXPLANATIONS AND NOTES RELATED TO THE UNCONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2017 (Amounts expressed in thousands of Turkish Lira (“TL”) unless otherwise stated.) PART III: FINANCIAL HIGHLIGHTS AND RISK MANAGEMENT 180 VakıfBank Annual Report 2017 Information on Changes in Value Adjustments and Credit Provisions Current Period The opening Balance Provisions amounts set aside during the period The cancelation of the provisions Other Adjustments (*) Closing Balance Specific Provisions 5,320,120 2,194,095 (936,786) 21,390 6,598,819 General Provisions 2,167,443 208 (280,949) (1,209) 1,885,493 (*) Includes effect of currency translations differences and other provisions’ classifications. (**) The TL 500,000 which occurs under the General Provisions on the current period, has been cancelled as of December 31, 2017, and free provision was made in the same amount. Prior Period The opening Balance Provisions amounts set aside during the period The cancelation of the provisions Other Adjustments (*) Closing Balance Specific Provisions 4,044,038 1,935,699 (665,884) 6,267 5,320,120 General Provisions 1,957,603 213,855 - (4,015) 2,167,443 (*) Includes effect of currency translations differences and other provisions’ classifications Fair value of collateral held against impaired loans December 31, 2017 December 31, 2016 Cash collateral (*) - - Mortgage 3,059,895 2,484,686 Promissory note (*) - - Others (**) 4,578,311 3,928,817 Total 7,638,206 6,413,503 (*) As a policy, it is aimed to utilize from cash collateral or liquidate promissory note for an impaired loan collateralized by cash collateral or promissory note to cover the credit risk. Hence, cash collateral and promissory note are shown as zero in the table above. (**) Sureties obtained for impaired loans are presented in this raw to the extent that the amount does not exceed the amount of impaired loans. The detail of collateral held against performing cash and non-cash loans by the Bank Cash loans December 31, 2017 December 31, 2016 Secured Loans: 142,928,602 113,223,472 Secured by mortgages 46,667,479 43,001,264 Secured by cash collateral 803,321 974,445 Guarantees issued by financial institutions 434,954 357,875 Secured by government institutions or government securities 19,124,808 2,420,844 Other collateral (pledge on assets, corporate and personal guarantees, promissory notes) 75,898,040 66,469,044 Unsecured Loans 40,003,626 33,395,520 Total performing loans 182,932,228 146,618,992 Non-cash loans December 31, 2017 December 31, 2016 Secured Loans: 24,286,702 16,831,079 Secured by mortgages 3,210,379 2,105,139 Secured by cash collateral 149,782 126,564 Guarantees issued by financial institutions 158,194 240,422 Secured by government institutions or government securities 570,608 - Other collateral (pledge on assets, corporate and personal guarantees, promissory notes) 20,197,739 14,358,954 Unsecured Loans 26,480,882 23,617,345 Total non-cash loans 50,767,584 40,448,424