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Türkiye Vakıflar Bankası Türk Anonim Ortaklığı
Unconsolidated Financial Report as at and
For the Year Ended 31 December 2013
(Currency: Thousands of TurkIsh Lıra (“TL”))
(Convenience Translation of Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish, See Section 3 Note I)
Risk management strategies and policies
Risk management strategies are determined so as to support the Bank’s objectives and goals and maintain Bank’s presence by developing the present
risk management strategies and corporate wide risk culture in parallel with the changing business and risk environment and by applying the well
accepted national and international risk management practices.
The mission of Bank is to continuously increase the values added to the customers, employees, shareholders and society by managing the entrusted
assets and values effectively and productively. In this scope, it is fundamental to adopt forward looking risk based approaches through forming high
quality assets and good management of liabilities in all activities aiming high quality gains.
Bank’s risk management strategy is mainly based on avoiding high risks and legal risks with high impacts even if the probability of happening is low,
taking measures for the risks that may occur due to ordinary banking activities, procuring protection, transferring risks to third parties through techniques
like insurance or credit derivatives and accepting risks that have low impact and probability of occurance.
Risks are defined, measured, reported and managed in compliance with the policies and national and international standards. In this respect, not only
legal limits but also in-bank limits are considered. Up-to-dateness and compliance of the limits are monitored regularly. Credit risk mitigation policies
are determined and approved by the Board of Directors. Besides, possible risks are considered by following the changes in the market and economic
conditions.
Risk management system and organization have been formed in compliance with the Regulation of Internal Systems.
VIII. Fair values of financial assets and liabilities
Carrying Value
Fair Value
Current Year
Prior Year
Current Year
Prior Year
Financial Assets:
Receivables from Interbank Money Markets
-
-
-
-
Banks
2,639,137
1,954,906
2,639,137
1,954,906
Available-for-Sale Financial Assets
16,288,187
14,127,523
16,288,187
14,127,523
Held-to-Maturity Investments
5,403,815
4,253,606
5,184,485
4,468,399
Loans
86,752,217
68,133,039
86,971,951
68,201,257
Financial Liabilities:
Bank Deposits
4,162,328
4,157,612
4,162,328
4,157,612
Other Deposits
77,370,486
63,084,678
77,370,486
63,084,678
Funds Borrowed
11,404,812
7,475,483
11,404,812
7,475,483
Securities Issued
6,884,826
2,430,313
6,884,826
2,430,313
Subordinated Loans
1,974,142
1,639,549
1,974,142
1,639,549
Miscellaneous Payables
2,696,105
2,223,602
2,696,105
2,223,602
Fair values of available-for-sale financial assets and held-to-maturity investments are derived from market prices or in case of absence of such prices
they are derived from prices of other marketable securities, whose interest rate, maturity date and other conditions are similar to securities held.
Fair value of fixed-interest loans are calculated by discounting cash flows with current market interest rates. For the loans with floating interest rate
carrying value also represents fair value.
Fair value of other assets and liabilities is calculated by adding accumulated acquisition costs and the sum of the interest accrual.
Classification of Fair Value Measurement
TFRS 7 – Financial Instruments requires the classification of fair value measurements into a fair value hierarchy by reference to the observability and
significance of the inputs used in measuring fair value of financial instruments measured at fair value to be disclosed. This classification basicly relies
on whether the relevant inputs are observable or not. Observable inputs refer to the use of market data obtained from independent sources, whereas
unobservable inputs refer to the use of predictions and assumptions about the market made by the Company. This distinction brings about a fair value
measurement classification generally as follows:
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