Q2 2024 Turkiye Halk Bankasi AS Earnings Call Transcript
Key Points
- Turkiye Halk Bankasi AS reported a 33.9% year-over-year increase in total assets, reaching TRY2.611 billion in the second quarter.
- The bank's NPL ratio remained stable at 1.5%, indicating strong asset quality management.
- Turkiye Halk Bankasi AS saw a significant improvement in its current account deficit, narrowing from $60 billion to approximately $25 billion.
- The bank's net fees and commissions improved by 19.4% quarterly and 127% year-on-year, surpassing inflation rates.
- The bank's CET1 ratio increased by 38 basis points compared to the previous quarter, reflecting a solid capital position.
- Net interest income decreased by 26.4% quarterly, impacting overall profitability.
- The bank's net income fell by 28.6% quarterly, with ROE coming in at 12.6%.
- Loan growth was limited to 2.3% quarterly, reflecting tight monetary policy and weak TL loan demand.
- The cost of funding increased due to the closing of CBRT swap lines, putting pressure on profitability.
- The bank's operating expenses increased by almost 40% year-over-year, despite efforts to manage costs.
Welcome, and thank you for all joining Halkbank's second-quarter financial results webcast. I hope you are all well. This is Muharrem Baykara speaking, Head of Investor Relations. Today, our Head of International Banking Group, Mr. Miraç TaÅ; me; and my colleagues, Kamer and Eylul, will host you in our earnings call.
We will update you on the operating environment and Halkbank's financials. At the end of the presentation, we will hold a Q&A session. Before delving into the specifics of our performance, I will start with the operating environment. As you know, Turkish economy grew by 5.7% in the first quarter. The unemployment rate remains at single-digit levels. So we are not observing any clear sign relating to hard landing in the Turkish economy by the first half of the year.
On the flip side, along with the lagged effects of the tightening in financial conditions, economic activity started to lose momentum by the second quarter. We expect that the cooling-down process in the economy will continue during the third quarter. On the
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