Investor Presentation30 Sept 2017

Leasing Sector in Turkey

LEASING

3

VAT is %1 for various types of machinery

Sale&lease back has been added to product range in 2013

Expertise on SMEs, consultancy and know-how support in addition to funding

FX borrowing option (Bank FX loans have some restrictions)

Fast credit approvals (leased-asset ownership), flexible payment plans

SECTOR NEW LEASING VOLUME

4

Leasing penetration is still at low levels

compared to EU average of 15% and

North America average of 18%.

Penetration: Leasing volume/ Private sector fixed

investments

New Leasing Volume

(million USD)

0%

2%

4%

6%

8%

10%

12%

201620142012201020082006

4.891 5.360

6.990

7.637

6.365 6.130

4.488

2011 2012 2013 2014 2015 2016 2017 Q3

LEASING RECEIVABLES

5

23% 26% 28% 28% 25% 26%

9.530 10.895 12.699 12.632 12.509 13.919

0,00%

20,00%

40,00%

60,00%

80,00%

100,00%

120,00%

0

2.000

4.000

6.000

8.000

10.000

12.000

14.000

16.000

2012 2013 2014 2015 2016 2017 Q3

TL % FX %(million USD)

Müşteri Adedi

6

CUSTOMER BASE

2016 vs. 2015

Fastest customer growth in

the sectorCustomers Δ Contracts Δ

İŞ LEASING 15% 15%

8.7% 9.03%

8.02%

8.18%8.19%

9.04%

10.02%10.54%

0%

2%

4%

6%

8%

10%

12%

-

10,000

20,000

30,000

40,000

50,000

60,000

70,000

2010 2011 2012 2013 2014 2015 2016 2017 Q3

Sector Total İş Leasing Share

Company Overview

MILESTONES & SHAREHOLDERS

8

1985 Leasing law

enacted

1988Established by İş Bank, Soc Gen and IFC

1995İş Bank

group took over

2000Listed in

İstanbul Stock Exchange

(ISFIN)

2009Joined BIST

corporate governance index

2011First corporate bond issuer in leasing sector

İŞ BANK27,79%

TSKB28,56%ŞİŞECAM

0.08%

FREE FLOAT42,67%

CAMİŞ0,83%

NEMTAŞ0,07%

İş Bank group controls 57,3% of the shares.

PARTICIPATIONS

9

İş Faktoring A.Ş. 78,23

Efes Varlık Yönetimi A.Ş 10,00

İş Yatırım Menkul Değerler A.Ş. (IS Invest) 4,86

İş Net 1,00

İş Girişim Sermayesi Yatırım Ort. A.Ş. 0,89

Yatırım Finansman A.Ş. 0,06

Subsidiaries and Participations Ownership %

ORGANIZATION CHART

10

BRANCH NETWORK

1111

Gaziantep

Diyarbakır

Trabzon

Kayseri

Adana

Ankara

Konya

Antalya

İzmir

Bursa

Şişli

Avcılar

Gebze

KozyatağıOstim

15 Branches

51 Sales staff

151 Total staff

Lease Portfolio

SALES CHANNELS

13

İşbank: 1348 local and 22

foreign branches, largest

network among private

banks.

57%

27%

16%

2016

İŞ BANK VENDORS DIRECT MARKETING

66%19%

15%

2017 Q3

İŞ BANK DIRECT MARKETING VENDORS

ASSET DISTRIBUTION , %

14

35,8

23,5

19,1

4,6 4,8

12,3

35,1

22,520,5

4,0 4,2

13,8

REAL ESTATE MACHINERY CONSTRUCTION MACH. TEXTILE TRANSPORTATION OTHER

2016 2017 Q3

SECTORAL DISTRIBUTION , %

15

24,3

14,5

7,0 7,8

4,5 4,9 4,5

32,6

24,4

12,810,6

7,35,4 4,4 3,5

31,8

CONSTRUCT METAL IND. TEXTILE TRANSPORT RETAIL CHEMICALS FINANCE OTHER

2016 2017 Q3

16

GEOGRAPHICAL DISTRIBUTION

İSTANBUL 47%

ANKARA 12%

GAZİANTEP 5%

BURSA 4%

İZMİR 5%

KONYA 3% ANTALYA 2%

OTHER 22%

19

26

19

12

20

8

USD EUR TRY

LEASES BORROWINGS

MATURITY DISTRIBUTION

17

2017 Q32016

average, months

*Portion funded by equity is included.

19

24

18

9

19

9

USD EUR TL

LEASES BORROWINGS

CURRENCY DISTRIBUTION

18

EUR33%

EUR 39%

EUR38%

USD32%

USD24%

USD23%

TL36% TL

36%

TL39%

2015 2016 2017 Q3

19

LEVERAGE

Increased leverage by gaining market share

3,1

4,04,3

5,0 5,0

2013 2014 2015 2016 2017 Q3

Leverage(solo)

626 692 755 821

306 474 659 847

932 1.166 1.414 1.668

2014 2015 2016 2017 Q3

TRY Receivables

Equity TL Debt TL Portfolio

20

• First corporate bond issuer in leasing sector, outstanding nominal balance 1.4

billion TL, maturities range between 3 months to 18 months.

• IFI and ECA Funding

o IFC renewable energy and energy efficiency facility, World Bank EFIL- SME loans, CEB SME

loans, BSTDB SME loan, ECO-Trade Bank,

• Islamic Debt Markets

• Closed two Murabaha facilities

• Strategy aiming diversification of creditors and debt products, maturity mismatch

within manageable limits

• Syndicated loans and eurobond issuance are being considered, cost of funding is

key to our evaluation

FUNDING POLICY

Financial Performance

FINANCIAL HIGHLIGHTS

22

TL Million, consolidated 2015 2016 2016/Q3 2017/Q3 Δ

Leasing Receivables, Net 3.287 4.001 3.501 4.483 28,05%

Factoring Receivables, Net 1.951 2.984 2.425 3.500 44,33%

Non Performing Receivables 183 231 191 250 30,89%

Provisions 140 150 150 165 10,00%

Total Assets 5.581 7.480 6.399 8.386 31,05%

Financial Liabilities 4.661 6.394 5.465 7.221 32,13%

Equity 738 830 798 934 17,04%

Net Interest Income 121 146 108 62 -42,59%

Provisions Expenses -48 -23 -13 -17 30,77%

Consolidated net Profit 82 104 77 86 11,69%

RATIOS

NPL / Receivables 3,40% 3,23% 3,14% 3,06%

Provision Ratio 76,30% 65,10% 78,61% 66,11%

Cost / Income 37% 38% 38% 66%

ROE 11,70% 13,20% 13,30% 12,99%

ROA 1,60% 1,60% 1,70% 1,44%

SOLO KEY FIGURES

NPL

24

0

50.000

100.000

150.000

200.000

250.000

Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Sep-17

151-240

241-360

>360

Total

Consolidated 31.12.2015 31.12.2016 31.03.2017 30.06.2017 30.09.2017

Gross NPL /Total

Receivables3,40% 3,23% 3,28% 2,98% 3,06%

Net NPL / Net Receivables 0,83% 1,15% 1,28% 1,10% 1,06%

000 TL LOSS RESERVE

2017 Opening (150.231)

Reversals 2.473

New provisions (17.236)

30.09.2017 Closing (164.994)

8,55%

7,99%

6,95%6,70%

6,03%6,26%

5,10%

7,60%

7,00%

4,80% 4,60%4,31%

4,65% 4,54%

2011 2012 2013 2014 2015 2016 2017 Q3

Sector İş Leasing(solo)

25

COLLATERALS*

Leased assets are legally possessed by the lessor so they are the collateral of the leasing loan.

Depending on the lessee’s credit ratings and second hand value of the leased asset, additional

collaterals might be demanded.

*Group leasing transactions excluded

Prom. Note+ Personal

Guarantee

92,05%

Cash + LG + Pledge + Buyback

2,47%

Mortgage5,48%

RATING

26

Corporate Governance Rating (Saha) : 9.17

Foreign Currency

Long-Term IDR BB+

Short-Term IDR B

Outlook Stable

Local Currency

Long-Term IDR BB+

Short-Term IDR B

Outlook Stable

National

Long-Term Rating AA + (tur)

Outlook Stable

Support Rating 3

DISCLAIMER

27

The information in this document has been obtained by İş Finansal Kiralama A.Ş. (“İş

Leasing”) from sources believed to be reliable, however, İş Leasing can not guarantee the

accuracy, completeness, or correctness of such information. This document has been

issued for information purposes only. The financial reports and statements announced by İş

Leasing to the public and the relevant corporations are accepted to be the sole material. İş

Leasing does not accept any liability whatsoever for any direct or consequential loss arising

from any use of this document or its contents due to the misleading information in this

document. All estimations, if any, contained in this document are the opinions of İş Leasing

and can be subject to change without notice. This document can not be interpreted as an

advice to the investors and İş Leasing can not be held responsible for the results of the

investment decisions made on the account of this document.