VKF_FRAE_2018_uyg11

514 Part III: Financial Highlights and Assessment of Risk Management EVALUATION OF THE BANK’S FINANCIAL POSITION, PROFITABILITY AND SOLVENCY EVALUATION OF ASSETS VakıfBank maintained its asset growth in 2018, attaining a 22.46% rise year-over-year and reaching TL 331,356 million in assets. In the breakdown of assets, the largest share belongs to loans, with a rate of 66.88% In 2018, the Bank’s performing loans, the fundamental intermediary function in the banking sector, increased by 21.14% and reached TL 221,607 million. Of the total performing loans, 76.80% are commercial and 23.20% are retail loans. The Bank increased its commercial loans by 26.09% and retail loans by 7.21%. When we examine the composition of retail loans, mortgage loans is up by 2.07% and general consumer loans by 2.85%. In 2018, the Bank’s non-performing loans ratio was 4.65%. In the same period, VakıfBank’s securities portfolio rose by 61.81% to TL 49,054 million, while the share of the securities portfolio in the assets was realized as 14.80%. EVALUATION OF LIABILITIES In 2018, the Bank’s total liabilities is up by 22.46%, while deposits increased by 15.54%. The share of deposits in total liabilities amounted to 54.14%. The most important item in the funding structure has been deposits which reached TL 179,408 million as of the end of 2018. 79.89% of deposits were term deposits, and 20.11% were demand deposits. Diversifying the sources of funds and performing effective cost management, VakıfBank raised the securities issued to TL 22,347 million. The local and foreign investors’ demand for the securities issued by the Bank, made a contribution to the diversification of funding sources and the extension of the maturity structure. In 2018, the Bank’s shareholders’ equity increased by 21.90% compared to the end of the previous year, reaching TL 28,350 million. The share of equity in liabilities was 8.56%. Adopting a profitable, efficient and high- quality growth strategy, VakıfBank takes firm steps towards its vision of being the “Leading Bank of Strong Turkey,” and continues to serve with 16,767 employees in 951 branches as of the end of 2018. Breakdown of Assets (%) 100 80 20 40 60 0 2014 2015 2016 2017 2018 Other Loans Cash Reserves Securities Portfolio 15.46 2014 2015 2016 2017 2018 Breakdown of Liabilities (%) 100 80 20 40 60 0 Other Securities Issued Funds Borrowed (including Subordinated Loans) Deposits Shareholders’ Equity 57.99 60.08 58.27 57.39 54.14 10.79 12.42 13.75 12.66 16.41 6.61 5.77 6.92 7.20 6.74 9.34 9.17 9.05 8.60 8.56 15.27 12.56 12.01 14.16 14.15 14.60 13.29 15.59 11.25 14.65 13.37 12.23 11.20 14.80 65.95 67.22 68.98 67.61 66.88 3.94 4.81 5.49 5.60 7.07