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YKB goes into the black on eve of merger with Koçbank

ISTANBUL – TDN/Referans | 5/10/2006 12:00:00 AM |

Falling into the red as a result of provisions made for its debts last year, Yapı Kredi Bankası went into the black after its balance sheet was reorganized, showing a profit of YTL 55.7 million

Closing the year with a YTL 3 billion loss in 2005, Yapı Kredi Bankası (YKB) made a profit of YTL 55.762 million in the first quarter of 2006 due to restructuring and adjustments made to help facilitate an expected merger with Koçbank.

The bank's 7.2 percent performance ratio for the end of 2005 has gone beyond the legal requirement of 8 percent, reaching 11.7 percent. YKB, expected to merge with Koçbank -- owned by Koç Finansal Hizmetler (KFH) under equal partnership between Koç Holding and Italian Unicredito -- had declared a loss of $2.9 billion in the last quarter of 2005.

 

Business profits up 168 percent:

YKB General Manager Kemal Kaya stated that his company's leading position in the credit card market is continuing. He said with the work the bank put in toward restructuring and merging it had begun to show signs of health. “With an understanding of the banking business, we will continue to contribute to the Turkish financial and social systems,” he emphasized, pointing to YKB's renewed competitive vigor. “The positive outlook in terms of first quarter figures in 2006 is an indication of our determination.”

The business profits of the bank in 2005 increased 168 percent following adjustments, reaching YTL 177 million. Net interest income went up 8.6 percent over the end of 2005, climbing to YTL 257 million. Meanwhile, total primary revenue jumped to YTL 248 million, an increase of 28 percent. Business expenses in 2005, on the other hand, showed a decrease of 10 percent, proceeding at the YTL 329 million level following adjustments.

Home loans increase fivefold:

The bank's total home loans went up 41 percent over the same period last year following adjustments made concerning Çukurova credits in September 2005. The total figure of home loans reached YTL 4.1 billion as of December 2005.

The leadership position YKB enjoys in the credit card market extends to the credit card endorsement market, where the bank is a major player with a market share of 23.5 percent. The size of its investment funds has grown 34 percent relative to the same period last year, reaching YTL 2.7 billion. Credits under investigation constituted 8.2 percent as of Sept. 30, 2005, increasing to 9.3 percent as of December 2005 and decreasing to 8.5 percent in April 2006. Total equities have reached YTL 1.7 billion. With the effect of capital-like credits, the adequate capital ratio of the bank has reached 11.7 percent.

The YKB's interest income decreased by 8.5 percent to YTL 653.3 million relative to the first quarter of last year. The interest income it obtains from loans, however, increased to YTL 502.9 million. Interest rates from banks' stocks and shares went down by 46.4 percent to YTL 117.8 million. The bank's total outstanding loans stand at YTL 11.9 billion, of which 56 percent is short term, and 41.8 percent are mid and long term.

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