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CEO’s Message

Distinguished shareholders, customers, business partners, and colleagues,

The year 2009 has been a successful one for İşbank in every aspect.

Adding the 64 branches that were inaugurated this year to its service network, İşbank has created employment for nearly 2,500 young bankers; this has countered the contraction in employment in the sector.

In 2009, our Bank has,

  • shown a strong performance that enhances shareholder value ,
  • proved the sustainability and appropriateness of its growth strategy once again,
  • demonstrated its ability to create value for all of its stakeholders by managing its business effectively.

Growth and development...
İşbank has continued to improve its infrastructure and growth uninterruptedly in a time where stagnation due to the economic crisis was felt on a global scale.

Adding the 64 branches that were inaugurated this year to its service network, İşbank has created employment for nearly 2,500 young bankers; this has not only increased the level of service provided, but also countered the contraction in employment in the sector. In times when even maintaining the current level of activity can be a cause for hesitation, İşbank is rightfully proud to have successfully increased its investment in its future.

Stability and trust...
With its combination of geographic location, demography, and economic structure that all suggest the potential for rapid growth, Turkey is a candidate to be one of the leading economies in the region in the medium term. As always, our faith in Turkey’s future and its economic potential is the real source behind our strength today.

Although the demand in the country’s major urban areas for many banking services like credit cards approach the levels found in mature markets, most of Turkey still has significant growth potential that can be translated into increased business opportunity.

The trust of the Turkish people, the strong interest of our customers, and the consistent demeanor and strong support of our shareholders have continued to be the fundamental factors that have enabled us to reach our growth targets in challenging times like these.

With this interest and support, İşbank continued to make investments throughout 2009 and succeeded to become one of the focal points of growth in the country.

Continuous improvement...
İşbank has placed great importance on improving its capabilities while maintaining its growth trajectory. After a three-year period, our Bank has come to the final stage of its Customer Centric Transformation Program, the most comprehensive transformation initiative completed in the Turkish banking sector to date.

This program, combining traditional values with the requirements of customer service and competitiveness at İşbank, has provided our Bank with the corporate structure, methodology, and technological infrastructure necessary to develop an expansion policy and compete on an international level.

Basically, this program aims to provide İşbank with a flexible and robust structure that allows us to compete easily with strong and well-capitalized international competitors in both Turkey and the surrounding region. The comprehensive transformation projects we have completed have aimed to establish the foundation of a banking culture that can expand easily beyond the borders of Turkey. İşbank has maintained its core founding principles as a guide during this historical transformation, and has always kept these values at the center of all its projects.


In 2009, İşbank’s total assets increased by 16.1%, to TL 113.2 billion.

Headlines from 2009 results...
The banking sector has had a positive year in 2009. In this framework, İşbank has been one of the actors who has strongly and consistently maintained its profitability.

In 2009, İşbank’s total assets increased by 16.1%, to TL 113.2 billion. The Bank’s total deposits grew by 13.6% and shareholders’ equity rose by 42.8%. Affected by the crisis and a decline in demand, loans grew by 1.5% for the year.

Although the growth of our balance sheet slowed a bit due to the stagnating effects of the economic crisis in 2009, we achieved a 34.5% increase in net interest income, which constitutes the majority of our income. The level we have reached in net interest margin clearly shows the positive results of our risk-sensitive, prudent, and proactive policies.

In a year when policy and market interest rates have plummeted to the lowest levels in recent history, our Bank has successfully managed interest expenses as well as interest income in prevailing market conditions. This growth in net interest income is mainly a result of the policies geared towards creating efficient and high-quality assets and the fact that the Bank has steered clear of relatively high-cost resources.

Sustainable, strong financial structure...
Our financial structure, supported by internal resources created as a result of our Bank’s activities over a very long period of time, shows healthy and sustainable growth.

Our Bank has successfully maintained a high level of capital adequacy through the policies that not only allowed İşbank to sustain but also improve its strength in an increasingly competitive market environment in recent years. Nonetheless, the growth in the shareholders’ equity of both the Bank and its subsidiaries as of year-end 2009 provides İşbank with the opportunity to create the strongest shareholder value in the financial sector in the future, as well. Moreover, this growth reinforces our conduct that constitutes as a driving force and an example of stability for the Turkish economy and the financial sector.

Having faith in Turkey and the future of its real sector, İşbank signed project finance deals with maturities of up to 10 years.

Away from crisis worries...
We managed, to a large extent, to keep our Bank and our customers protected from the reservations felt both in the financial and real sector during the year 2009, when there has been stagnation due to the global crisis.

In 2009, with the prudent and risk-sensitive policies determined, our market share in the economic activities was maintained and our efforts to provide funds to the real sector, which is one of the basic duties of banking, continued with determination. Customers have entrusted İşbank with their assets throughout the year and continued their businesses with the comfort of finding the resources they need at favorable market terms.

The year 2009 has been one where our activities in project financing have been in the forefront. Having faith in Turkey and the future of its real sector, İşbank signed project finance deals with  maturities of up to 10 years during a crisis period when global investment banking giants were forced into bankruptcy or a take-over. The resources our Bank provides for projects that constitute as foundation stones for the future of Turkey, especially in the energy sector, have reached significant levels.

Our determination to participate in economic activities and our sound lending policies have not only met with the approval of our customers from across Turkey, but also confirmed our objectives of creating value and long-term growth for our shareholders.

Regional strength...
İşbank has an international service culture and experience honed over many years. Shortly after its establishment in 1924, the Bank opened its first international branches in Alexandria and Hamburg in1932.

İşbank Alexandria and Hamburg branches are milestones in our country’s financial history as they were the first international branches of a Turkish bank. Since this pioneering development, İşbank has created an effective international service network and has come to a point where it provides distinctive services to not only its Turkish customer base, but also to its international customers.

At the onset of 2010, İşbank is evaluating investment opportunities presented by international markets, primarily in the neighboring region.

Preparing to take its international organizational structure to a new level, our Bank’s assessment for investment in markets in the surrounding region is ongoing. Moreover, the process of opening new İşbank branches or representative offices in the geographic region around Turkey continues.

Our representative office in Cairo, the capital city of Egypt, is now ready to launch and a significant progress was made to open a branch in Azerbaijan.

Our Bank believes that just like Turkey, the region in which we are located has all the right dynamics for future growth. İşbank is equipped with the necessary strength, know-how, and experience to benefit from these dynamics in the most efficient way.

We will continue expanding our service network primarily through new branches in 2010.

Growth at the onset of the 100th anniversary...
İşbank will grow in all business areas in which it can provide services to its customers. In Turkey, where utilization of banking services is quite low in comparison to the developed countries, we strongly believe that the banking sector will continue to grow and that the financial sector will expand and further develop. We will continue expanding our service network primarily through new branches in 2010.

As a result of the Customer Centric Transformation Program that has been ongoing for the past three years, our Bank is prepared in every aspect to provide high-quality and high-value added products and services to a growing customer base. Structural strength deriving from the improved technological infrastructure and a well-qualified workforce will act as a leverage to increase our market share. This will positively reflect in our revenue and İşbank will continue its journey to 2024, the Bank’s 100th anniversary, as a healthy growing, sound and reliable banking institution.

“Turkey’s Bank” is the foundation of social responsibility projects...
In addition to its banking activities, İşbank, founded upon the mandate of Atatürk as part of the initiatives of the Turkish Republic, has deemed it as its mission to contribute to many social fields, including the arts and culture, education, science, and sports, within this development movement. İşbank has always considered contributing to the social development of Turkey and social solidarity among its highest institutional priorities. We believe that this guiding principle has manifested itself strongly in our 2009 activities, as well.

Today, when the impact of globalization is ubiquitous, education is the primary driver of competition. Countries that provide a good and equal education to all their youth can accelerate the growth of their economies and improve their social welfare. Our Bank places particular importance on education in accordance with the founding objective set by our founder Atatürk, the Great Leader. For that reason, İşbank became the main sponsor of the Turkish Chess Federation in 2005. In 2009, the number of chess classes in elementary schools reached 2,000, while the number of students taking chess classes exceeded 1.7 million. We are proud to see that the developments that arose as a result of our support of the highly educational sport of chess are shown as an example throughout the world. Last year, we initiated the “81 Students from 81 Cities” project in cooperation with Darüşşafaka, one of the leading non-governmental organizations in Turkey, to support educational equality. The first group of students of this project passed on to the next grade and the group of new students that passed the exam in 2009 began their education with the opportunities provided by İşbank. In addition, İşbank launched in 2008 the “Show Your Report Card, Get Your Book” project, one of the largest book campaigns so far. In 2009, this project continued at full speed and 2 million books were distributed to 2 million children.

Global climate change has been scientifically proven to be caused by human activity. Last year, we initiated the “81 Forests in 81 Cities” project in an effort to leave our children a greener world with cleaner air. As of year-end 2009, areas in 32 cities have been forested with the help of volunteers from the TEMA Foundation, employees from the Ministry of Environment and Forestry, Turkish children, members of the local community, and our employees. İşbank is pleased to be sponsoring the largest and most extensive forestation project in Turkey.

We expect the Turkish economy to return to its growth path in 2010 and business opportunities to increase with this revitalization.

Wide investor base and unique capital structure...
İşbank has one of Turkey’s widest investor bases and has consistently represented Turkey’s capital strength. As an institution supported mainly by domestic capital, İşbank has a unique position and is among the Turkish companies whose shares are most demanded by international investors.

Its unique capital structure and corporate conduct create a competitive edge and constitute a regional source of prestige. İşbank has been creating value unceasingly for the past 85 years and this ability has brought rightfully earned acclaim to İşbank. İşbank will continue contributing to the Turkish economy, at an increasing rate, while being guided by this recognition and acclaim in its journey to the future.

We expect the Turkish economy to return to its growth path in 2010 and business opportunities to increase with this revitalization.

The momentum we have gained and the importance we place on growth will increase the added value we provide to our shareholders, employees, and Turkey. We gained this momentum as a result of the capabilities of our employees and their devotion to their work under the leadership of our Board of Directors.

I would like to thank all our shareholders, Board Members, customers, business partners, and colleagues.

Yours sincerely,

Ersin Özince
Member of the Board and Chief Executive Officer