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YapıKredi1Q19InvestorPresentationY
YapıKredi1Q19InvestorPresentationYapıKredi: A leading financial services groupYapıKredi OverviewKey Figures–1Q19Market Share–1Q19393.4blnTL1,241mlnTL230.5blnTL13.3%Market Share518,237Notes: 1. Loans indicate performing loans, 2. RoATEindicates return on average, tangible equity (excl. intangible assets), 3. Bank-only, 4. Group data. Bank-only: 17,379, 5. Market shares are based on: Interbank Card Center(for credit card acquiring and number of cardholders), Turkish Leasing Association (for leasing), Turkish Factoring Association(for factoring), Central Bank Cheque Clearing System (for cheque clearing) Rasyonet(for mutual fund

s), BorsaIstanbul (for equity transact
s), BorsaIstanbul (for equity transaction volume). If not specified, data based on BRSA bank-only data for YKB and BRSA weekly sector data excluding participation banks for banking sector as of 29Mar’19, 6. Cash loans excluding credit cards and consumer loans, 7. Including mortgages, GPL and auto loans, 8. Refers to leasing receivablesas of YE2018, 9. Refers to factoring turnoveras of YE 2018, 10.Refers to Mutual FundsTotal AssetsLoans1Net IncomeRoATE2Employees4Total BankBusiness UnitsSubsidiaries9.8%Cash & Non-cash LoansCustomerDeposits10.2%CorporateLoans68.8%Consumer Loans7Credit Card OutstandingLeasing8Factoring9WealthManagement

108.4%20.9%20.7%16.7%13.6%Rat
108.4%20.9%20.7%16.7%13.6%RatingsMoody’s: B3 / Fitch: BB-/ S&P: B+854Number of Branches323International/ MultinationalCommercialTurnoverUSD 10-100 mlnCorporateTurnover�USD 100 mlnPrivate BankingTotalPFA � TL 500KSMEBanking1TurnoverUSD 10 mlnIndividual BankingCorporate and Commercial Banking3 Branches46 Branches1 Branch776Branches22 BranchesCredit CardsRetail BankingSubsidiariesMaltaWell-diversified commercial business mix and customer-oriented service modelNotes: Branch numbers are as of Mar’19. Total # of branches is 854of which 6 are free zone, abroad, custody and moblie branches1.Including micro

+ small + large size enterprisesAzerba
+ small + large size enterprisesAzerbaijanNederlandAsset ManagementInvestLeasingFactoring4Shareholding StructureSimple, successful, pan-European, commercial bank with a unique Western, Central and Eastern European network in 14 core markets1Q19Total Assets (EUR bln)22.9Revenues (EUR mln)5,625Net Income (EUR mln)1281Q19Total Assets (EUR bln)847.7Revenues (EUR mln)4,952Net Income (EUR mln)1,387Ratingsaoody’s: B1/ S&P: BB-Ratingsaoody’s: Baa1 / Citch: BBB / S&P: BBB81.9%1Largest business group in Turkey with combined revenue equal to 8% of Turkey’s GDP50%50%Stable, long-term focused majority shareholders supporting YapıYredi

’sgrowth Notes: All information and
’sgrowth Notes: All information and figures regarding UniCredit and Yoç Holding arebased on publicly available 1Q19data, unless otherwise stated1.Remaining 18.1% listed on the Istanbul Stock ExchangeStrong and committed majority shareholders bringing stability, strength and depth to corporate governanceKOÇFINANCIAL SERVICESA strong start to the year, characterized by strong core performance along with prudent asset quality approach Summary5Notes: 1.Adjusted for hedged FX impact. Stated CoR: 4Q18: 3.88%; 1Q19: 2.52%; 2018: 2.74%2.Pre-Provision Profit figures exclude ECL collection income, trading income to hedge FC ECL and pension fund provisions reserved in

4Q183.Adjustedfor the /tI linker inc
4Q183.Adjustedfor the /tI linker income’s 9 months impact of inflation revision from 16% to 25.2% (1,268 mlnTL). Peers include private banks that have released their financials as of 2 May 2019Quarterly Net Profit (TL mln)RoTE+15%CoR1-229bpsPre-Provision Profit2(TL mln)Highest growth among peersStableYearly +193bps-37bps-88bpsQuarterly Cumulative+40%Quarterly Yearly CumulativeQuarterly 3,959CPI linkeradj.3+16%Further improvement in liquidity, higher than committed capital buffers despite the market volatilitySummary6Notes: 1.LDR= Loans / (Deposits + TL Bonds)2.Based on past three months averagesFC LCRTL Duration Gap (months)Liquidit

yTL LDR+73bpsShort term FX Liquidity
yTL LDR+73bpsShort term FX Liquidity: ~11 blnUSD2019 run-off’s: 4.0blnUSDLDR1LCR2CapitalTier 1 RatioCAR+19bpsCET1 Ratio-42bpsLoans: growth driven by TL originations in 1Q19Notes: 1.Private banks based on BRSA weekly data as of 29 March 20192.Cash Loans indicate performing loans excluding factoring and leasing receivables3.TL and FC loans are adjusted for the FX indexed loansLendingLoan volumes (TL bln)Sectoral Breakdown of Cash and Non-Cash Loans -bank only75% total loan growth on a ytdbasissupported by 6.9blnTL CGF utilization in 1Q19-2% contraction in FC cashloans+1% FX adjusted cash loan growthEnergy13%Real Estate3%Deposits: quarter

marked by dollarization, ongoing market
marked by dollarization, ongoing market share gain in local currency small ticket and demand depositsNotes: 1.Private banks based on BRSA weekly data as of 29 March 20192.Based on MIS data (weekly average)FundingDeposit volumes (TL bln)Deposit Breakdown (FX adjusted)28Corporate & CommercialTime DepositsRetailTime DepositsDemandDepositsDeposit market share1Notes: 1.Revenuesandotherrevenuesexclude ECL collection income and trading income to hedge FC ECL 2./ore Revenues = NII + swap costs + Net fee income; 4Q18 core revenues are adjusted for the /tI linker income’s 9 months impact of inflation revision from 16% to 25.2% (1,268 mlnTL). 3.CoreRevenue Margi

n= Core Revenues / average IEAs,Based
n= Core Revenues / average IEAs,Based on bank-only financials; StatedCoreRevenueMarginin 4Q18: 5.8%Strong revenue generation thanks to wider corespreadand fee growthRevenuesQuarterly2;3CumulativeRevenues1;2(TL mln)CoreRevenue Margin3-55bps921 bpsytdimprovement with the same CPI-inflation assumption4,9064,5183,724+32%+9%+41bpsOther1Core2WideningNIM thankstostrongrecoveryin core spreadsRevenues -NIMCumulativeSwap Adjusted NIM10Notes: Based on Bank-Only financials1.4Q18 NIM isadjusted for the /tI linker income’s 9 months impact of inflation revision from 16% to 25.2% (1,268 mln TL). Stated4Q18 NIM: 4.6%2.Basedon MIS Daily

averagesQuarterly NIM up 81bps, on
averagesQuarterly NIM up 81bps, on a homogeneous basiswhencalculatedwith the same CPI-inflation assumptionat 12%+20 bpshigherNIMadjustedforCPI linkers2CPI for 1Q19 valuation: 12%(2018: 25.2%)+14bps-75bps+15bps1QuarterlyA normalisationin loan-deposit spreads in 1Q19 with ease in deposit costs and ongoing loan repricingNotes: Based on Bank-Only financials1.Performing Loan yields Loan-Deposit Spread210bps increase in total loan yields on a quarterly basis vs. 4Q18 thanks to ongoing loan repricing effortsSharp decline in total cost of deposits (-130 bps, q/q) driven by the ease in TL cost of deposits (-191bps q/q)Loan Yields1(Qu

arterly)Deposit Costs (Quarterly)Norm
arterly)Deposit Costs (Quarterly)Normalisationin Loan-Deposit spread already evident in 1Q19Loan-Deposit Spread (Quarterly)TLTL+FXTLTL+FXTLTL+FX11Loan –Deposit Spread EvolutionCum. TL yield 2018: 15.0%Cum. TL cost2018 : 13.5%Cum. TL spread 2018 : 1.4%Strong fee growth driven by both transactional banking and payment systemsRevenues -FeesNet Fee Income(TL mln)Fees Received Composition•Payment systems: +51% y/y (-4% q/q)•Lending Related: +29% y/y (+35% q/q)Non-cash: 48% y/y (+6% q/q)•Money Transfer: +69% y/y (+24% q/q)•Bancassurance: +129% q/q12+20%+29%Cost growth below inflation, thanks to continuous efficiency actio

ns and cost disciplineCostsNotes:1.E
ns and cost disciplineCostsNotes:1.Excluding pension fund provision (4Q18: TL 230 mln). Reported cost growth (including pension fund provisions ) at-14% q/q2.2018 Income adjusted for trading income to hedge FC ECL and collections3.4Q18 incomeadjustedfor9 months impact of inflation revision from 16% to 25.2% (1,268 mlnTL). Costs1(TL mln)13Cost1/ Income2(TL mln)Quarterly3Cumulative-4.8pp+69 bps-3%+18%Digital transformation: ongoingfocuswithincreasein customerbase14Notes: Based on MIS data1.Total Cost to Serve and Cost to Serve per channel are calculated based on direct costs of each sales channels2.Main Products; GPL, CC, Time Deposit, and

Flexible Account3.Transactions include
Flexible Account3.Transactions include, Money Transfers, Payments, Deposit, Cash Loans, Non-cash Loans, Insurance, Money withdrawal, Investment products, Credit CardsNumber of Digital Customers (mln)Share of digital in main products2soldPenetration+3pp14+0.2mlnTransaction3per channelBranchAutomatic Payments+14%+5%-10%+10% y/y Digital+11%ATM+1.1mlnhngoing prudent approach on asset quality… CoRimproves thanks to strong collections and up-fronted provisions in 2018Notes: 1.Cost of Risk = (Total Expected Credit Loss-Collections)/Total Gross Loans2.Adjusted for hedged FX impact. Stated CoR-4Q18: 3.88%; 1Q19: 2.52% -2018: 2.74%Asset Quality1

5Total Cost of Risk1 Cost of Risk com
5Total Cost of Risk1 Cost of Risk composition (1Q19)Specific CoRSpecific CoR-229bps22-37bpsQuarterly Cumulative22Furtherincreasein total coveragewithcontinuedeffortson Stage2; Stage3 coveragemaintainedNotes: Based on Bank-Only BRSA financials1.SCIR: Significant Increase in Credit RiskTL 2.0 blnNPL sales in 2018 (628 mlnin 1Q18; 1 blnin 2Q18; 367 mlnin 3Q18)and396 mlnin 1Q19Peersinclude private banks that have released their financials as of 2 May 2019Asset QualityStage ICoverage16Provisions / Gross LoansStage IIStage IIISICR1RestructuredDays past dueOtherReal EstateEnergy45%7%48%74%18%8%Highestamong peersHig

hestcoverage among peersHighestcov
hestcoverage among peersHighestcoverage among peersOngoingconservatismin energyandrealestateportfoliosNotes: 1.Based on Bank-Only MIS dataAsset Quality17RenewableDistributionCoal FiredNatural GasEnergy Loans1details 53% 20% 16% 11%(2.3x of total loans)(0.9x of total loans)Risk ScaleCoverageStage II LoansReal Estate Loans1details (4.0x of total loans)(1.6x of total loans)Stage II LoansStage II Coverage(1.2x of total loans)(1.5x of total loans)Breakdown by sub-segments(2.8x of total loans)(1.2x of total loans)Market volatility and operational risk adjustment resulted in slight contraction in CET1 while internal capital generation

sustainsNotes: 1.Minimum capital leve
sustainsNotes: 1.Minimum capital levels are based on consolidated requirements (fully loaded BRSA)CapitalCapital Ratios18CARCET1Tier18.1%1+73bps+19bps9.6%112.0%-42bpsMaintaining2019 guidanceGuidance19Notes:1.All figures based on BRSA bank-onlyexceptforCAR2.TL Loansanddepositgrowthannualizedfor1Q19211AnnexMacro Environment and Banking Sector21Notes:All macro data as of December 2018 unless otherwise statedBanking sector volumes based on BRSA weekly data as of 28 aar’19; NPL Ratio, CAR and ROATE based on BRSA monthly data1.CAD indicates Current Account Deficit as of Feb’192.Unemployment rate is as of Jan’19Loangrowthimprov

eswiththesupportof CGF utilisations
eswiththesupportof CGF utilisationsin 1Q19CBRT maintains the tight stance tosustaintheongoinginflationimprovementBanking Sector Macro EnvironmentConsolidated Balance SheetAssetsLiabilitiesNote: Loans indicate performing loans1.2017 figures recastedfor IFRS 9 reclassification of general provisions2.TL and FC Loans are adjusted for the FX indexed loans3.Other interest earning assets (IEAs) include cash and balances with the Central Bank of Turkey, banks and other financial institutions, money markets, factoring receivables, financial lease receivables4.Other assets include investments in associates, subsidiaries, joint ventures, hedging derivative financial assets, pro

perty and equipment, intangible assets
perty and equipment, intangible assets, tax assets, assets held for resale and related to discontinued operations (net) and other5.Borrowings: include funds borrowed, marketable securities issued (net), subordinated loans. Intragroup funding from UniCredit€2.12bn(Dec 18was €2.41bn/ Total exposures is limited to cash excluding Business Related (i.e. Trade Finance), Repos and loro/nostroaccounts)6.Other liabilities: include retirement benefit obligations, insurance technical reserves, other provisions, hedging derivatives, deferred and current tax liability and other223456Consolidated Income StatementNote:1.2Q18 ROTE is adjusted for the 4.1 blnTL rights issue

on 30th of June 23Bank-Only Income
on 30th of June 23Bank-Only Income StatementNote:1.2Q18 ROTAE is adjusted for the 4.1 blnTL rights issue on 30th of June 24NIM Evolution25QuarterlyCumulative141bps267bps1Note:1.CPI inflationimpactfrom25.2% to12%2.Impactof 4Q18’s /tI linker income’s 9 months impact of inflation revision from 16% to 25.2% (1,268 mlnTL).SecuritiesNotes:1.Based on Bank-Only financials2.Excluding accrualsSecurities/AssetsComposition by Type1Composition by Classification130.5FixedCPISecurities / assets at 13.2% with dynamically managed mix to benefit from rate environmentIncrease in CPI linkers to benefit from higher inflation levels. CPI-linker vo

lume wasalmoststableat TL 15.6bl
lume wasalmoststableat TL 15.6bln in book value2(nominal: 13.0 blnTL); with a gain of TL 787mlnin 1Q19M-t-m unrealisedloss at TL 2,507mlnas of 1Q19(TL -437mlnin 1Q18)Security Yields1TLFCCPI linkervaluationat 12% (2018: 25.2%)TL Securities (blnTL)FC Securities (blnUSD)2.52.435.8Floating37.2FV through P&LFV through Other Comprehensive ProfitAt amortisedcost2.426Details of main Borrowings27InternationalDomesticSyndications ~ US$ 2.1blnhct’18:US$ 275mln & € 690.7mln, all-in cost at Libor+ 2.75% and Euribor+ 2.65% for 367 days. 27 banks from 13 countries aay’19:US$ 350 mlnand € 607mln, all

-in costat Libor+ 2.50% andEurib
-in costat Libor+ 2.50% andEuribor+ 2.40% for367 days. 49banks from 21countries AT1~US$ 650 mlnoutstandingJan’19: US$ 650 mlnmarket transaction, callable every 5 years, perpetual, 13.875% (coupon rate) Subordinated Loans~US$ 2.6 blnoutstandingDec’12: US$ 1.0 blnmarket transaction, 10 years, 5.5% (coupon rate) Jan’13: US$ 585 mln, 10NC5, 5.7% fixed rate –Basel III CompliantDec’13:US$ 270mln, 10NC5, 7.72% –Basel III Compliant aar’16:US$ 500 mlnmarket transaction, 10NC5, 8.5% (coupon rate)Foreign and Local Currency Bonds / BillsUS$ 3.65blnEurobondsJan’13: US$ 500 mln, 4.00% (coupon rate), 7 yearsï

€¼hct’14: US$ 550 mln, 5.125% (cou
€¼hct’14: US$ 550 mln, 5.125% (coupon rate), 5 yearsCeb’17: US$ 600 mln, 5.75% (coupon rate), 5 yearsJun’17: US$ 500 mln, 5.85% (coupon rate), 7 yearsJun’17: TL500 mln, 13.13% (coupon rate), 3 yearsaar’18:US$ 500 mln, 6.10% (coupon rate), 5 yearsaar’19: US$ 500 mln, 8.25% (coupon rate), 5.5 yearsCovered BondTL 1.57 blnout standinghct’17:Mortgage-backed, maturity 5 yearsCeb’18:Mortgage-backedwith 5 years maturityaay’18: Mortgage-backedwith 5 years maturity aar’19: Mortgage-backed with 5 years maturity Local Currency Bonds / BillsTL 2.1blntotalJan’19 : TL 142 mln, 3 months matu

rityFeb’19: TL 710 mln,2
rityFeb’19: TL 710 mln,2months maturityMar’19: TL 1,27bln,2months maturity1Q191Q191Q191Q191Q191Q19Turkey: A large and dynamic country with solid growth potential and resilient fundamentals28Europe’s 7thlargest economy and a member of G20Young, dynamic, large andgrowing populationSovereign ratings of Ba3/B+/BB by aoody’s/ S&P/FitchTurkeyConverging economy with growth potentialFocus on achieving balanced growth driven by both consumption andnet exportsStrong fiscal discipline with low public debt/GDPStable CAD/GDPSource: Turkstat, Eurostat (for population, median age, population gr

owth, GDP, per capita GDP, unemployment)
owth, GDP, per capita GDP, unemployment), IMF (for world ranking), CBRT (inflation), Bloomberg (benchmark), Turkstatand CBRT (for CAD/GDP), Treasury and Turkstat(public debt/GDP), CBRT, BRSA, Treasury and Turkstat(private debt/GDP)Notes: EU indicates EU27 countries (source: population and macro data based on Turkish Statistical Institute)Based on Turkish Statistical Institute and IMF World Economic Outlook1.As of end-20162.As of January20193.As of February2019MacroTR 2017EU 2017Population (mln)81513Median Age32431Population Growth (CAGR 2000-2017)1.5%0.3%GDt (€ bln)75215,336World Ranking17-ter /apita GDt (€)9,31129,900World Ranking68-Turkey

Despite solid growth in recent years, T
Despite solid growth in recent years, Turkish banking sector still underpenetrated in household lending29Branches PerMillion Inhabitants(2017)(Loans+Deposits)/GDP(2018)Source: European Central Bank, BRSA, CBRT, Turkstat, FRED database for India, Brazil, S.AfricaNote: Loan dataon graphs for all countries based on 2018 actual figureswhile GDP figures are as of 2017(1) Excluding lending to credit institutions(2) Including housing loans, consumer lending and other household lending (including CC, excluding SMEs)2018 GDP numbers are forecasted figuresCorporate Loans/GDP Total Loans1/GDPBanking Sector PenetrationLoans to Households2/GDPTurkeyEU-28S.AfricaIndiaPolan

dBrazilMortgages/GDPHealthy banking s
dBrazilMortgages/GDPHealthy banking sector, resilient against external shocks and supporting economic growth30Well regulated (BRSA est. in 2001)Best practices in technology: payment systems and well-qualified workforceHealthy profitability Sound asset quality, liquidity andcapitalisationBanking SectorDevelopmentsRegulatory developments:-CGF(supporting the loan growth )-capital (potential alignment to IRB)-provisioning(IFRS9 as of 2018)-corporate tax rate increase (2018-20 to 22%)Interest rate and currency volatilityPricing competition and maturity of funding sourcesAsset qualityBanking SectorSource: Turkish Banks Association f

or bank and branch numbers, BRSA for
or bank and branch numbers, BRSA for banking sector data (including BS, P&L, KPIs), Turkstat for GDP dataNotes:(1)1Q19 GDP assumed stable at 2018 level(2)Based on BRSA monthly financials; indicating deposit banksChallengesCBRT rates31Notes:Benchmark Bond Rate: Yield of themost traded 2-year government bondCBRT Average CoF(cost of funding): Weighted average cost of outstanding funding of the CBRT via open market operations including O/N repo, one-week repo and one-month repoCredit Ratings324.5%4.5%4.5%1.5%1.5%1.5%2.0%2.0%2.0%1.25%1.875%2.5%0.75%1.125%1.0%0.017%0.025%0.034%10.02%11.03%11.53%2017 Requirement2018 Requirement2019+ RequirementCET

1AT1T2CCBSIFICCyB33Phase-in of
1AT1T2CCBSIFICCyB33Phase-in of Consolidated Capital Requirements for YapıKrediCET 1 Ratio6.5%7.5%8.05%Tier 1 Ratio8.0%9.0%9.55%Capital Adequacy Ratio12.0%12.0%12.0%AT1 Pillar 1CET1 Pillar 1Tier 2 Pillar 1Capital Conservation BufferSIFI BufferCountercyclical Buffer Consolidated Capital Requirements for YapıKredi/onsolidated regulatory capital requirements for YapıKrediNotes:Reflects current status of regulatory capital requirements which may be subject to change. Pillar 2 framework for Turkey alreadyexists, however BRSA capital requirements currently do not include any Pillar 2 add-on. /ountercyclical buffer can be updated based on regulatory decision

and bank’s exposuresContact invest
and bank’s exposuresContact investor relations34Yapıve KrediBankası Head OfficeYapı Yredi tlaza D BlokLevent 34330 Istanbul -TURKEYTel: +90 (212) 339 67 70Email: yapikredi_investorrelations@yapikredi.com.trWeb: http://www.yapikredi.com.tr/en/investor-relationsYürşad YETE/İ-Strategic Planning and Investor Relations, EVPkursad.keteci@yapikredi.com.trHilal VAROL-Head of Investor Relationsand Strategic Analysishilal.varol@yapikredi.com.trEce OKTARGÜRBÜZ-Investor Relations Managerece.gurbuz@yapikredi.com.trCan ASLANKAN-Investor Relations Supervisorcan.aslankan@yapikredi.com.trCansu GmR/ÜY -Investor Relations Specialistcansu.gorcuk@yap

ikredi.com.trDisclaimerThispresentati
ikredi.com.trDisclaimerThispresentationhasbeenpreparedbyYapıveKrediBankasıA.Ş.(the“Bank”).Thispresentationisnotdirectedat,orintendedfordistributiontooruseby,anypersonorentitythatisacitizenorresidentof,orlocatedin,anylocality,state,countryorotherjurisdictionwheresuchdistributionorusewouldbecontrarytolaworregulationorwhichwouldrequireanyregistration,licensingorotheractiontobetakenwithinsuchjurisdiction.Thispresentationdoesnotconstituteorformpartof,andshouldnotbeconstruedas,anofferorinvitationtosellsecuritiesoftheBank,orthesolicitationofanoffertosubscribefororpurchasesecuritie

softheBank,andnothingcontainedher
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tionfrom,orinatransactionnotsubjectto,theregistrationrequirementsoftheSecuritiesActandapplicablestatesecuritieslaws.TheBankdoesnotintendtoregisterortoconductapublicofferingofanysecuritiesintheUnitedStatesoranyotherjurisdiction.ThispresentationisanadvertisementandisnotaprospectusforthepurposesofEUDirective2003/71/ECandanyamendmentsthereto,includingtheamendingdirective,Directive2010/73/EUtotheextentimplementedintherelevantmemberstateandanyrelevantimplementingmeasureineachrelevantmemberstate(the“trospectusDirective”)and/orPartVIoftheUnitedYingdom’sFinancialServicesandMarketsAct2000.

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