FINANCIAL INFORMATION AND RISK MANAGEMENT
TÜRKİYE İŞ BANKASI A.Ş.
Notes to the Consolidated Financial Statements for the Year Ended
31 December 2012
ANNUAL REPORT 2012
XXVI. Segment Reporting
Business segment is the part of an enterprise,
• which conducts business operations where it can gain revenues and make expenditures (including the revenues and expenses related to
the transactions made with the other parts of the enterprise),
• whose operating results are regularly monitored by the authorities with the power to make decisions related to the operations of
the enterprise in order to make decisions related to the funds to be allocated to the segment and to evaluate the performance of the
• which has its separate financial information.
Information on the Group’s business segmentation and related information is explained in Section Four Note XV.
XXVII. Other Disclosures
SECTION FOUR: INFORMATION ON THE FINANCIAL POSITION AND RISK MANAGEMENT OF THE GROUP
I. Explanations on Consolidated Capital Adequacy Ratio
The Group’s and the Parent Bank’s capital adequacy standard ratios are 16.28% and 16.33%, respectively. Consolidated and unconsolidated
capital adequacy ratio is calculated within the scope of the “Regulation on Measurement and Assessment of Capital Adequacy Ratios of
Banks”, “Regulation on Credit Risk Mitigation Techniques” and “Regulation on Calculation of Risk Weighted Amounts for Securitizations”
published in the Official Gazette no.28337 dated 28 June 2012, effectiveness date is 01 July 2012, and the calculations are made according
to “Regulation on Equities of Banks” published in the Official Gazette numbered 26333 dated 1 November 2006.
Capital adequacy ratio is calculated from obligated required capital of the credit risk, the market risk and the operational risk. The amount
subject to credit risk on balance sheet assets and non-cash loans, commitments and types of derivative financial instruments, risk classes
and ratings of risk weights are evaluated by taking into account the relevant legislation.
The amount subject to credit risk for non-cash loans and commitments are considered by using the conversion rates which are defined in
the 5th article of “Regulation On Measurement And Evaluation Of Capital Adequacy Of Banks” after deducting specific provision amount
which is calculated from the article of “Determining the Nature of Loans and Receivables and Principles and Procedures on the Allocation
of Loan and Receivable Provisions” published in the Official Gazette no.26333 dated 1 November 2006. The items, which are considered as
deductions from capital amount, are not considered in the calculation of capital requirement of credit risk.
Such financial assets, liabilities and off-balance sheet transactions are classified in two separate portfolio as “trading accounts” and
“banking accounts” in accordance with the legal regulations and the Parent Bank’s internal risk policies. Actively traded asset on balance
sheet, derivative transactions held for trading, and trading accounts comprising foreign currency positions are used in calculation of market
risk according to the Standard Method by the Bank. Financial instruments and non-financial assets which are excluded from trading book
and classified as banking book are subject to calculation of credit risk.
In the calculation of the Parent Bank’s operational risk, “Basic Indicator Method” is used.