VKF_FRAE_2018_uyg11

VakıfBank Annual Report 2018 515 EVALUATION OF PROFITABILITY The Bank’s net profit for the period is up by 11.57% compared to the previous period, reaching TL 4,154 million. In the same period, VakıfBank’s earnings on interest rose to TL 33,954 million while interest expenses were realized as TL 23,113 million. The net earnings on interest were at TL 10,841 million. Compared to the previous period, the earnings on interests is up by 58.34% and the interest expense by 80.25%. Thus, the ratio of interest earnings to interest expenses amounted to 146.90%. As of the end of 2018, the Bank’s average return on equity was 16.10% while its average return on assets was 1.38%. SOLVENCY RATIO Keeping the share of the interest bearing assets in the total assets at 87.41% in 2018, VakıfBank maintained its strong liquidity structure, and preserved its solvency ratio. Carrying on its growth in loans without compromising on risk control, VakıfBank’s capital adequacy ratio, 16.99%, was above the legal limits and target ratio, which serves as another indicator of its financial strength. The long-term evolution of the capital adequacy ratio is presented in the chart. In the following period, VakıfBank will expand its customer base and increase its product diversity while continuing to grow by tapping into potential growth possibilities in and outside the country. 2014 2015 2016 2017 2018 Return on Assets and Equity (%) 25.00 2.00 20.00 1.60 5.00 0.40 10.00 0.80 15.00 1.20 0 0 Average Return on Assets Average Return on Equity 12.80 1.19 12.24 1.13 15.01 1.37 17.52 1.54 16.10 1.38 2014 2015 2016 2017 2018 Capital Adequacy Ratio (%) 20.00 16.00 4.00 8.00 12.00 0 16.99 15.52 14.16 14.52 13.96