Türkiye’s Garanti Bank earned a net income of TL 15.5 billion in the first quarter of the year. Total assets stood at TL 1.5 trillion and the bank contributed TL 1.1 trillion to the economy through lending activity. Customer deposits reached TL 1.0 trillion (+14 percent this quarter) and remain the primary source of funding, with 70 percent of assets funded by deposits. Garanti Bank continues to have a strong capital position, with a ratio of 15.9 percent¹. Its ROAE was 38.2 percent in the first three months of the year, and ROAA stood at 4.5 percent².
Garanti BBVA CEO Recep Baştuğ spoke of the earthquakes that ravaged Türkiye: “As a country, we faced a great disaster this quarter. As an institution, our first priority is to support the local community and employees in conjunction with the government and our stakeholders. Our number one task right now is to be with our people and continue to provide all kinds of support.”
The global economy began 2023 with recession, high inflation and crises in banks around the world, underscoring the importance of a sound banking sector. In Türkiye, the banking sector is in a strong position to support the needs of the country thanks to its healthy balance sheet structure. The CEO emphasized that: “Lower inflation and greater stability on a macroeconomic level are essential for the sector. At the moment, capital profitability is below inflation. Sustainable profitability is necessary for the sector to maintain its solid capital levels, and support economic growth.”
In Türkiye, credit growth is heavily affected by intense regulation. In the first quarter of the year, Garanti BBVA’s commercial loan portfolio experienced a significant slowdown, while consumer loans and credit cards continued to grow as usual. Asset quality is high and is expected to remain this way for the upcoming period. Nevertheless, the bank continues to implement its provision policy, setting aside the highest nominal provisions in the sector.
Turning to customers, Recep Baştuğ explained that while customer acquisition is a strategic priority, greater engagement from existing customers is currently more important. Digitization, data and artificial intelligence serve as the bank’s key accelerators in this regard. At the end of 2022, Garanti BBVA was a pioneer in the sector for its open banking service, allowing customers to do their banking on any channel, at any time and from any place. “We have taken digitization to the highest level by including commercial clients, and we expect to contribute even more to our customers and clients in the upcoming period with this feature that distinguishes us from the sector,” the CEO said.
Sustainability is a strategic priority for Garanti BBVA, and encompasses more than financing for the bank, becoming signatories of major global commitments. Garanti BBVA was the first bank in Türkiye to announce intermediate decarbonization targets, in line with the Paris Agreement Capital Transition Assessment (PACTA). The bank was also included in the Dow Jones Sustainability Index for the 8th year in a row with the 5th highest score in the world. It plans to continue to hold ‘Sustainable Future in Export’ meetings, which the bank began in 2022.
“We will continue to stand by our customers and create value for our stakeholders with our strong balance sheet and competent human resources. I would like to thank my colleagues for their hard work and contributions to the bank’s results in the first quarter of the year, and all of our stakeholders who supported and trusted us,” Recep Baştuğ concluded.