FINANCIAL INFORMATION AND RISK MANAGEMENT
TÜRKİYE İŞ BANKASI A.Ş.
Notes to the Unconsolidated Financial Statements for the Year Ended
31 December 2012
ANNUAL REPORT 2012
16. Miscellaneous Information According to Type of Counterparty or Major Sectors
Farming and Raising Livestock
Electricity, gas, and water
Wholesale and Retail Trade
Hotel, Food and Beverage Services
Transportation and Telecommunication
Real Estate and Renting Services
Health and Social Services
Refers to loans overdue up to 90 days. Related Items included in the commercial installment loans and installment consumer loans are given only in the overdue amounts, the payment of these
loans outstanding principal amounts of TL 623,460 and TL 844,584 respectively.
Refers to the general provisions for non-performing loans.
Refers to specific provision for impaired loans.
17. Information on Value Adjustments and Change in Credit Provisions:
Adjustment Ending Balance
III. Explanations on Market Risk:
1. Information on Market Risk:
The market risk carried by the Bank is measured by two separate methods known respectively as the Standard Method and the Value at Risk
Model in accordance with the local regulations adopted from internationally accepted practices. In this context, interest rate risk emerges as
the most important component of the market risk.
The market risk measurements are carried out by applying the Standard Method at the end of each month and the results are included in the
statutory reports as well as being reported to the Bank’s top management.
The Value at Risk Model (VAR) is another alternative for the Standard Method used for measuring and monitoring market risk. This model is
used to measure the market risk on a daily basis in terms of interest rate risk, currency risk and equity share risk and is a part of the Bank’s
daily internal reporting. Further retrospective testing (back-testing) is carried out on a daily basis to determine the reliability of the daily risk
calculation by the VAR model, which is used to estimate the maximum possible loss for the following day.
Scenario analyses which support the VAR model used to measure the losses that may occur in the ordinary market conditions are practiced,
and the possible impacts of scenarios that are developed based on the future predictions and the past crises, on the value of the Bank’s
portfolio are determined and the results are reported to the Bank’s top management.
The limits set for the market risk management within the framework of the Bank’s asset liability management risk policy, are monitored by
the Risk Committee and reviewed in accordance with the market conditions.