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Istanbul an emerging IFC in the making?

November 28, 2012

Hakan Binbasgil

CEO, Akbank

Financial Times 2012 Global Summit on International Financial Centres, 27&28 November 2012, The Four Seasons Park Lane, London.

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GDP/Capita Tripled in 10 years...

2

3.492

10.673

2002 2012

US$

3X

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Strong Fiscal Discipline...

3

11,5

2002

Budget Deficit / GDP

2,3

E(2012)

Public Sector Debt % of GDP

%

Source: Ministry of Finance

74,0

2002

36,5

E(2012)%

Source: Undersecretariat of Treasury, Ministry of Development

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Improving Current Account Deficit...

4

-10,0

-6,7

2011 E(2012)

%GDP

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Falling Unemployment Rate...

5

10,8

8,8

2004 8/2012

%

14,0

2009Source: TURKSTAT

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Favorable Demographics...(50% under the age of 30)

6

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High mobility, internet and social media usage

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65% households with internet.

(1)

32 mio Facebook users.

9 mio Twitter accounts.

89% ownership in mobile phones.

10.6 mio mobile internet users.

66 mio mobile subscribers.

119 mio airline passengers.(1)

7 mio new vehicles in 7 years.(1)

Urbanization rate: 77%.(1)

(1) as of 2011, other statistics are November 2012 figures

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Sound Banking Sector...

8

CAR

NPL

Low leverage

High liquidity

No toxic assets

No derivative products(1)

(1) Excluding derivatives for hedging

16 %

2,9 %

8 X

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Strong Growth in Banking...

9

213

2002

Assets

TLbillion

Including participation banks

1.308

3Q 2012

Loans Deposits

49

2002

TLbillion 756

3Q 2012

138

2002

TLbillion 738

2012

CAGR 20% CAGR 32% CAGR 19%

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Further Growth Potential in Banking...

10

356

Assets

Financial Intermediation Indicators

E

uroArea***:2011,Turkey:2011%o

fGDP

94

Deposits Loans

116

51

131

52

EuroArea***

Turkey *19 mio people unbanked

Household debt/GDP: 17%**

Mortgage/GDP: 6%

Mutual funds/GDP: 2.3%

Pension funds/GDP: 1.1%

* Including participation banks** Household dept includes only performing consumer lending and credit card receivables.***Euro Area: Non-MFIs sector,

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State of the Art Technology in Banking...(Examples from Akbank)

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Mobile Loans Web Loans SMS Loans(2005) (2006) (2007)

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Why we think Istanbul will emerge as an IFC ?

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Istanbul is a Major Transportation Hub...

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20% of Turkeys population

(greater than 19 EU countries).

22% of Turkeys GDP.

45% ofTurkeys exports.

52% ofTurkeys imports.

2.8 million students.

44 Universities.

200 Hospitals.

Turkish Airlines THY,3rd largest airline in EU,flies to 189 destinations (40local).

Istanbul has easy access to multiple markets worth

USD 25 trillion of GDP and 1.5 billion customers in

Europe, Eurasia, the Middle East and North Africa.

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Thank you