Contents. Part I : Part II :

Transcription

1 Annual Report 2013

2 Yapı Kredi Faktoring 2013 Annual Report 1 Contents Part I : Independent Auditor's Report 2 General Information 3 Chairman's Letter 6 Board, Executive Management and Organization Chart 7 Business Operations and Material Operational Developments 9 Financial Highlights 12 Risks and Risk Assessment Report of Directors 13 Part II : Financial Statements and Independent Auditor's Report as of 31 December

3 2 Yapı Kredi Faktoring 2013 Annual Report Independent Auditor s Report To: BoD of 1. As a part of our independent audit studies, we assessed whether the financial statements and Board assessments and remarks, set forth in the s ( Company ) annual report issued as of 31 December 2013, are in compliance with the financial statements which were subject to independent audit. 2. It is the Company s responsibility to prepare the Annual Report in accordance with the Directive on Minimum Requirements of Annual Report of Companies. 3. As being an independent audit corporation, our liability is to put forth opinions on whether the financial statements set forth in the annual report are in compliance with the financial statements which were subject to independent audit dated 07 February Our evaluation is based on the principles and procedures related to preparation and publication of annual reports, which has become effective under Turkish Commercial Code Those arrangements intend planning and implementation in order to reasonably ensure to avoid material mistakes on compliance of the financial statements, which were subject to independent audit, with the data actually obtained by independent auditor. We are in belief that our evaluation forms a reasonable and adequate basis for generation of our opinions. 4. Our opinion is that the financial statements and the Board assessment and remarks enclosed are in compliance with the financial statements of, which were subject to independent audit. Güney Bağımsız Denetim ve Serbest Muhasebeci Mali Müşavirlik A.Ş. A member firm of Ernst & Young Global Limited Seda Hacıoğlu, SMMM Responsible Partner Chief Auditor İstanbul, 28 February 2014

4 Yapı Kredi Faktoring 2013 Annual Report 3 Part I General Information

5 4 Yapı Kredi Faktoring 2013 Annual Report General Information Trade name: Period covered by the Annual Report: January 1 st 2013 December 31 st 2013 Company Reg. ID: Mersis Nr.: Share capital: TL 31,916,695 Address: Büyükdere Caddesi Yapı Kredi Plaza A Blok Kat:14 Levent, İstanbul / Türkiye Telephone / Fax nr.: / Website: Number of employees: 91 Branch Offices: 10 branches, namely, Beyoğlu, Eminönü, Güneşli, Kartal, Kadıköy, Izmir, Bursa, Ankara, Adana, and Antalya. Adana Branch Reşatbey Mahallesi Atatürk Caddesi A Blok No:18/1 Kat:7 Semih Rüstem İş Merkezi Seyhan / Adana Telephone: (0 322) Ankara Branch Atatürk Bulvarı No: 93 Kat: 5 Kızılay - Ankara Telephone: (0 312) Antalya Branch Kızıltoprak Mahallesi Aspendos Bulvarı YKB Şubesi No:35 Antalya Telephone: (0 242) Bursa Branch Ulubatlı Hasan Bulvarı Ulu Mah. No: 59 Osmangazi - Bursa Telephone: (0 224) Izmir Branch Gazi Bulvarı No: 3 Egehan Kat: 4 Pasaport - Izmir Telephone: (0 232) Beyoğlu Branch Şehitmuhtar Cad. No:5 Kat:7 Beyoğlu / Istanbul Eminönü Branch Aşirefendi Cad.No:31 Sultanhamam / Eminönü Istanbul Telephone: (0 212) Güneşli Branch Cihangir Mah. E-5 Yanyol Cad. No: 291/1 Avcılar Istanbul Telephone: (0 212) Kartal Branch Mustafa Kemal Caddesi Şehit Gazi Sok. Adalet Sarayı arkası Hukukçular Towers - A BLok Kat : 17 Kartal Istanbul Telephone: (0 216) Kadıköy Branch Kozyatağı Mah.Ş.Mehmet Fatih Öngül Sok. No:1 Kat:5 Kadıköy Istanbul Telephone: (0 216) Shareholding Structure (*) Shareholder Share rate Share Value (TL) Yapı ve Kredi Bankası A.Ş. % ,901,499 Temel Ticaret ve Yatırım A.Ş. % ,393 Yapı Kredi Finansal Kiralama A.O. % ,799 Koç Yapı Malzemeleri A.Ş. % Zer Madencilik ve Dayanıklı Mallar Yatırım Pazarlama A.Ş. % % ,916,695 (*) During the Extraordinary Assembly of Shareholders dated 20 November 2013, it was resolved to increase share capital from TL 16,802,326 to TL 31,916,695 in 2013.

6 Yapı Kredi Faktoring 2013 Annual Report 5 Yapı Kredi Faktoring in Brief For 13 years, Yapı Kredi Faktoring has been the leader of the market in terms of turnover. Yapı Kredi Faktoring, Turkey s pioneering and innovative factoring company, has a strong market position thanks to its robust operational performance, well-established presence and high quality of service. Being the leader of Turkish factoring market, Yapı Kredi Faktoring holds a market share of 26% in total export factoring transaction volume, and an overall market share of 17%. Yapı Kredi Faktoring renders factoring services allover the country through Istanbul Head Office, and Beyoğlu, Eminönü, Güneşli, Kartal, Kadıköy, Izmir, Bursa, Ankara, Adana and Antalya Branches. The synergy resulting from its close relationship with Yapı Kredi Bank and, particularly, its nationwide sales and service network, is one of Yapı Kredi Faktoring s most important service and competitive advantages. The service points of Yapı Kredi Bank, which has more than 949 branches, provide Yapı Kredi Faktoring with extensive reach. Since 2002, Yapı Kredi Faktoring has been ranked among the Best Export Factoring Companies by FCI throughout the world, and in 2013, the Company is awarded with the fourth rank designed as having excellent quality of services. Yapı Kredi Faktoring has also received an excellent evaluation in terms of service quality. Yapı Kredi Faktoring has a strong presence in both domestic and international markets. The Company delivers an outstanding operational performance with its well-defined strategies, ensures sustainable quality in factoring services with its brilliant and dedicated team and provides unique solutions to its strategic client portfolio. For the last 13 years, Yapı Kredi Faktoring has been the undisputed market leader in terms of factoring turnover thanks to its robust capital structure, wealth of experience, proven service quality and expert human resources. Yapı Kredi Faktoring is a full member of Factors Chain International (FCI), headquartered in Amsterdam; the Company is also a member of the Turkish Factoring Association.

7 6 Yapı Kredi Faktoring 2013 Annual Report Chairman's Letter In terms of overall transaction volume, Yapı Kredi Faktoring maintains its continuous leading position since Dear Shareholders, In 2013, a fluctuating economy took place in Turkey due to both global and local progress. Foreign capital penetration growingly continued during the first half of the year thanks to the rise in sovereign ratings. Whereas during the second half, the signals of reduction in buying bonds by FED led to increasing volatility and macro-precautionary measures. Despite such tough competition and violent conditions, Yapı Kredi Faktoring has maintained in 2013 its solid growing strategy without compromising customer-focused service approach. Realizing 26% of overall export factoring in 2013, Yapı Kredi Faktoring has maintained leadership with a market share of 17%, as we continuously have this title since Moreover, we realized a total transaction volume of USD 7,492 million by an increase of 22%, whereas 72% thereof comes from domestic actions, and 28% thereof comes from international factoring. Yapı Kredi Faktoring realized revenue of TL 119 million in 2013, and also benefited from the branch network of Yapı Kredi allover the country. Besides the head office in Istanbul, additional branches have been introduced in Istanbul, Adana, Ankara, Antalya, Bursa and Izmir, which in return forms 10 points for services. At the core of Yapı Kredi Faktoring s approach to service is an excellent ability to develop and deliver customer- and market-focused functional solutions and fast and high quality services tailored to its customers unique needs. This approach not only reflects the Company s corporate culture, but also helps the Company constantly improve and strengthen its business processes. Furthermore, being ranked among the Best Export Factoring Companies for the last 12 years by Factors Chain International (FCI) allover the world, Yapı Kredi Faktoring holds the fourth rank in Likewise, we are awarded by FCI with the excellent service quality ranking worldwide.. Yapı Kredi Faktoring has assumed the important mission of expanding the factoring market by promoting wider use of factoring services. Boasting a robust capital structure, a high level of reliability and an extensive funding capacity, the Company aims to maintain its market leadership and expand its international presence. In 2014, our primary responsibility will be to maintain our leading position in the market and be the first choice of our customers through our full range of services and exceptional business performance. While keeping our solid growing strategy, I hereby express my sincere thanks to our clients, who rely on us, to our shareholders, who do not hesitate to support us, and to our employees for their dedication and their valuable contributions in achieving the remarkable results. Faik Açıkalın Chairman of Board

8 Yapı Kredi Faktoring 2013 Annual Report 7 Board, Executive Management and Organization Chart BoD Faik Açıkalın Chairman Carlo Vivaldi Vice-Chairman Feza Tan Member Marco Iannaccone Member Nurgün Eyüboğlu Member M. Coşkun Bulak Member (General Manager) Executive Management M.Coşkun Bulak General Manager Atilla Kurban Assistant General Manager Işıl Eskici Assistant General Manager Can Özyurt Director - Product Develop. & Monitoring S. Suhan Kaptan Director - Treasury & Foreign Relations Zeynep Emecen Kandemir Director - Financial Control, Accounting & Operations Internal Control Nilay Özbir BoD Internal Audit Pınar Adıyaman Demirtaş General Manager M. Coşkun Bulak Sales Işıl Eskici Loan Allocation and Risk Monitoring Atilla Kurban Financial Control, Accounting & Operations Zeynep Emecen Kandemir Product Develop. & Monitoring Can Özyurt Treasury & Foreign Relations S. Suhan Kaptan

9 8 Yapı Kredi Faktoring 2013 Annual Report Financial Benefits Provided to Directors and Executive Officers The total amount of the financial benefits, such as honorarium, remuneration, bonus, dividend, etc., paid to the Directors and Executive Officers is TL ,-. The total amount of the daily allowances paid to the Directors and Executive Officers, both in cash and in kind, to cover their business travel, accommodation and representation expenses, insurance etc. is TL ,-. R&D Studies The Company implements R&D and marketing studies in order to expand client base and to improve current client portfolio.

10 Yapı Kredi Faktoring 2013 Annual Report 9 Business Operations and Material Operational Developments Sales At Yapı Kredi Faktoring, our goal is to further improve and expand the Company s strong presence by building sustainable and even closer relations with our customers. The Sales Unit of the Company is a truly dynamic one, offering diversified products in both domestic and international markets. In 2013, Yapı Kredi Faktoring recorded a total factoring turnover of USD million, whereas 28 % of this turnover was generated from international factoring operations and 72 % from domestic. Holding the leading position in the domestic factoring market for the last 13 years, the Company s market share represents 17% in Additionally, for the last 12 years, Yapı Kredi Faktoring has been ranked among the Best Export Factoring Companies in the world by Factors Chain International (FCI), and, in 2013, we are ranked fourth among FCI members. FCI also rated the Company s service quality as excellent. The Company closely monitors all developments in the market, and we achieved 728 new customers in The Company provides services primarily to three different segments of customers Corporate Customers (large-scale companies), Commercial Customers (smalland medium-sized enterprises) and Suppliers (suppliers and industrial manufacturers) through 10 branches across Turkey. 949 branches of Yapı Kredi Bank across the country is the Company s most functional distribution channel along with its own sales network. Fuelled by the synergy created through this close cooperation, the Company aims to continue to provide high quality services with a focus on its potential and existing customers. Loan Allocation and Risk Monitoring Yapı Kredi Faktoring manages loan risk focused on effective risk management and supports sales activities to achieve common targets. High-risk actions that may adversely impact reputation of the company are particularly avoided. Credit lines are determined taking into consideration the financial structure of the client, and in accordance with a pre-structured repayment schedule according to client s commercial needs. For monitoring and management of loan risks, risk policies in parallel with Yapı Kredi s are applied. In 2013, in order to manage loan risks in a more effective manner, number of employees of loan allocation-, risk monitoring- and intelligence units are increased, hence, subsequent improvement is achieved in effectiveness for audit processes and for reporting. Reports related to risk are issued regularly, and relevant informing is performed in executive management and the BoD. Product Development and Monitoring The Product Development and Monitoring Unit develops and implements marketing strategies that serve to acquire new customers and identify opportunities to work with existing customers over the long term, and also effectively implements communication with Yapı Kredi, the major shareholder. Moreover, thanks to the synergy with Yapı Kredi Bank, the Unit develops business opportunities to make Yapı Kredi Faktoring reach wider customer mass. The primary responsibilities of the Unit include developing new products and new business in line with market needs, playing a key role in expanding the customer base and achieving sustainable growth in order to help the Company achieve its objectives. The Unit also conducts the Company s Corporate Communication operations such as media-, advertising-promotion, meeting and seminar events. Treasury & Foreign Relations Funding activities are performed by the Treasury & Foreign Relations Unit. Treasury aims to serve client needs without taking directional risk on the market. Treasury s general strategy is to actively manage the Company s assets and liabilities structure by hedging interest rate, liquidity and foreign exchange rate risk. Yapı Kredi Faktoring has always had an excellent reputation among creditor institutions and foreign correspondent factoring companies. The Company also maintains a widespread bank portfolio and numerous credit lines. Financial Control, Accounting and Operation The Unit measures the Company s operational performance in terms of revenue, profitability and turnover in order to achieve the corporate performance targets while taking financial risk, market risk and operational risk into consideration. Additionally, the Unit works to comply with all BRSA regulations, IFRS and Group principles, policies and procedures, and to ensure accounting systems comply with those. The Unit also supports Yapı Kredi Faktoring s strategic objectives by providing data on the financial position of the Company and other relevant information to facilitate decision making processes. In 2013, a total number of 5,020 loan allocation proposals were assessed and opinions were set forth. As of the end of 2013, YKF loans under track represent 3,6%, which is well below market average of 6,4% (according to TBB Risk Center data).

11 10 Yapı Kredi Faktoring 2013 Annual Report Internal Control and Internal Audit The Internal Control and Internal Audit Units have been structured in a manner to ensure strict control over all the processes across the Company and also to improve their efficiency and effectiveness. These Units report only to the Board of Directors and this ensures their independence within the organization. The Internal Control and Internal Audit Units conduct audits and report their findings and corrective action plans to the Board of Directors via the Audit Committee. The Audit Committee is responsible for assessing the efficiency and sufficiency of the internal systems and also ensuring that all audit activities are conducted in a consolidated manner. Furthermore, the Internal Control employees are liable of controlling the activities of the Company to be compliant with the directives prescribed by BRSA and the Committee for Investigation of Financial Crimes. Future Outlook; Maintaining Leadership Yapı Kredi Faktoring achieved one of its primary objectives in 2013: market leadership. Having a solid capital structure, high level of credibility and extensive sources of funding, Yapı Kredi Faktoring plans to maintain its leading position in the market by developing new factoring products and services. Yapı Kredi Faktoring aims to maintain sustainable growth by expanding customer base, to the extent possible, by means of growing business opportunities offered by the networks of Yapı Kredi Bank and UniCredit. Affiliates and Subsidiaries Yapı Kredi Faktoring transferred 810,675,777 shares representing a nominal value of TL ,77, which forms 7,95% of Yapı Kredi Sigorta share capital, to Allianz S.E. on 12 July 2013, in consideration of TL ,-. The Company maintained its shares in Yapı Kredi Emeklilik in Share rate Share Value (TL) Yapı Kredi Emeklilik A.Ş. % ,593 26,593 In 2013, Yapı Kredi Faktoring donated TL ,- to Vehbi Koç Foundation, and TL 1.900,- to Turkish Education Foundation, TEMA and Bogazici University Foundation, which forms a total amount of TL ,-. Extraordinary Assembly of Shareholders held within the Period On 20 November 2013, Extraordinary Assembly of Shareholders convened for amendment in articles of incorporation, and as per the permit granted by Republic of Turkey Ministry of Customs and Trade General Directorate of Domestic Trade, dated September 16, 2013 nr / , and in compliance with the Turkish Commercial Code 6102, Financial Leasing, Factoring and Finance Companies Code 6361, and other relevant legislation, and in parallel with the Company s requirements, articles 4-22 of AoI of the company has been amended, whereas articles and the Provisional articles 1, 2 and 3 have been removed. Audits by Regulatory Bodies and Independent Auditor Yapı Kredi Faktoring is audited by an independent audit firm on a quarterly basis. In 2013 no public audit was made in the Company. Lawsuits filed against the Company There is no lawsuit filed against the company, which may impact financial status or operations of the company.

12 Yapı Kredi Faktoring 2013 Annual Report 11 Yapı Kredi Bank Yapı Kredi is the first retail-focused private bank in Turkey with a nationwide presence, providing added value for its customers through its customer-oriented approach, strong competitive advantages and extensive service network. Yapı Kredi Bank renders banking services such as retail banking (including individual banking, SME banking, and card-payment systems), corporate and commercial banking, private banking and assets-management. The Bank s operations are supported by subsidiaries in Turkey including portfolio management-, investment-, financial leasing- and factoring-corporations, and by the foreign banking subsidiaries in Netherlands, Russia and Azerbaijan. Being one of the well-established and reputable corporations in banking industry, Yapı Kredi has again not compromised in 2013 its client-focused approach. Bank s assets reached to TL 160 billion by an annual increase of 22%. Besides, loan book grew by 28% on annual basis, reaching TL 99,4 billion, whereas deposit volume reached to TL 88,5 billion by an annual increase of 24%. Yapı Kredi stands at fifth rank in terms of overall loans, by a market share of 9,5%, whereas holds the 6th rank in total deposit with a market share of 9,1%. By virtue of the approach oriented in innovation in technology, Yapı Kredi keeps leading position in value-added products and services. The Bank is the leader for the last 25 years in credit card industry; whereas the market share figures are as follows: 20,6% in terms of credit card balance, 17,7% in terms of credit card turnover, and 17,8% in terms of number of credit cards. On the other hand, the Bank is also the leader in financial leasing (top rank by a market share of 14.8%), in factoring (top rank by a market share of 17%), in investment funds (2nd rank by a market share of 18.2%), and in share certificate transaction volume (3rd rank by a market share of 6.9%). Yapı Kredi serves to 8,8 million clients thanks to wide coverage area and multi-channel service network. The Bank possesses 949 branches allover Turkey, where 16,682 young and dynamic employees are employed. Products and services of Yapı Kredi are also offered to clients via state-of-the-art alternative distribution channels such as 3,000 units of ATM (market share of 7.1%), innovative internet banking (3.2 million clients), pioneer mobile banking (market share of %10.9), 2 call centers (award-winner) (42 million client-contact per year), and 456,000 POS terminals. 83% of overall banking transactions are performed off-thebranch. Koç Finansal Hizmetler A.Ş. ( KFH ) holds 81,80% of Yapı Kredi shares. KFH is a joint venture formed by the Koç Group and UniCredit Group with equal shares (50 %-50 %). The remaining 18.2 % of the Bank s shares are listed on the Istanbul Stock Exchange. Global Depositary Receipts representing such public shares are quoted on London Stock Exchange. Roots going back to 1926, Koç Group is the largest conglomerate in Turkey by turnover, export and 84,000 employees thereof. Turnover of the Koç Group forms 7% of national income, whereas export of the Group forms 8% of Turkey s allover export. UniCredit Group, established in 1473, is a financial corporation based in Italy, which plays a significant role in Europe banking system. The Group possesses 9,000 branches in 22 countries, with 148,000 employees.

13 12 Yapı Kredi Faktoring 2013 Annual Report Financial Highlights Turnover (million USD) 2011 Domestic 5,443 4,149 5,149 International 2,049 2,001 1,896 Export 2,044 1,994 1,876 Import Total 7,492 6,150 7,045 Balance Sheet & Income Statement Major Accounts (.000 TL) 2011 Factoring Accounts Receivable (net) 2,149,220 1,650,735 1,760,103 Total Assets 2,196,454 1,791,190 1,850,957 Factoring Accounts Payable 6,843 10,675 7,190 Shareholder's Equity 263, , ,986 Net Profit 149,335 53,342 15,776 Factoring Revenue 119, , ,904 Interest Income 104, , ,842 Commission Income 14,430 19,031 20,062 Total Assets (.000 TL) ,196, ,791, ,850,957 Factoring Accounts Receivable, net (.000 TL) ,149, ,650, ,760,103 Shareholder's Equity (.000 TL) , , ,986 Factoring Revenue (.000 TL) , , ,904 Total Turnover (mio USD) , , ,045 Debt/Equity Ratio (%)

14 Yapı Kredi Faktoring 2013 Annual Report 13 Profit Distribution Policy The Company distributes profits in accordance with the provisions of Turkish Commercial Code, Tax Legislation, and other relevant legislation as well as articles of AoI in connection with the profit distribution. Provisions related to profit distribution are given thoroughly in article 18 of the AoI. With this regard, Shareholders Assembly is entitled to distribute dividends, given the growing targets and financial requirements of the company, or to add profits onto the capital, to distribute shares to be issued free of charge, or employment of both methods in certain rates, provided that relevant legislation is complied with. Shareholders Assembly is entitled to resolve on profit distribution for second dividends or setting aside the balance as extraordinary reserve funds, upon setting aside legal reserves and initial dividends, in accordance with article 18 of the AoI. Profit distribution policy must comply with the medium- and long term growing targets of the company. The BoD may assess said policy, if necessary, depending on the national- and international economical conditions. Risks and Risk Assessment Report of Directors The Board of Directors did not prepare any risk assessment report as no significant risk was discovered in On the other hand, credit risk, market risk, interest rate risk, liquidity risk, foreign exchange risk and other risk-related matters are discussed in detail in Article 22 under the Notes to the Independent Auditor s Report. Miscellaneous Mustafa Coşkun Bulak is acting as the General Manager since 8 January Marco Cravario resigned from the BoD as of 20 May 2013, whereas Marco Iannaccone has been appointed in lieu thereof as of the same date. Atilla Kurban has been appointed as Ass. General Manager for Credit Risk Management on 01 March In lieu of Mete Ünsal, who resigned from Ass. General Manager s Office for Sales Office on 30 June 2013, Işıl Eskici has been appointed to be effective from 01 July Rengin Altınok has been appointed as Ass. General Manager for Yapı Kredi Faktoring Operations, IT and Administrative Affairs as of 01 January Report on Subsidiaries, Prepared Pursuant to Article 199 of the Turkish Code of Commerce Article 199 of the Turkish Code of Commerce, numbered 6102 and came into force on 1 July 2012, Board of Directors is required to prepare a report, during the first quarter of each financial year, on the Company s controlling shareholder and the Company s relations with entities controlled by its controlling shareholder, and also to include the conclusion paragraph of that report in the Company s annual report. All required information on the business transactions entered into by with any of its related parties is disclosed in Note 21 to the financial report. In its Report, dated 26 February 2014, the Board of Directors of states: We have concluded, under the circumstances and conditions known to us, that, in respect of any business transaction entered into by with its controlling shareholder and with entities controlled by its controlling shareholder in 2013, a counteraction was taken or neglected in relation to and at the time of any such transaction, that there is no any measure taken or neglected in a manner that could cause financial damage to the Company, and that there is no any transaction or measure, requiring any counterbalancing action in this context.

15 14 Yapı Kredi Faktoring 2013 Annual Report Faik Açıkalın Chairman of Board Carlo Vivaldi Vice-Chairman Feza Tan Member Marco Iannaccone Member Nurgün Eyüboğlu Member M. Coşkun Bulak Member (General Manager)

16 Yapı Kredi Faktoring 2013 Annual Report 15 Part II Financial Statements and Independent Auditor's Report as of 31 December 2013

17 16 Yapı Kredi Faktoring 2013 Annual Report Financial Statements and Independent Audit Report as of December 31, 2013 Independent audit report To: The Board of Directors of Yapı Kredi Faktoring Anonim Şirketi We have audited s (The Company), financial statement as of December 31, 2013, the income statement of the fiscal year ended by the same date, shareholders equity profit and loss account statement, statement of changes in the shareholders equity, cash flow statement and a summary of important accounting policies and other explanatory notes. Statement on the Responsibility of the Board of Directors. The Company s Board of Directors is responsible from the selection and application of appropriate accounting principles and establishment of an internal control system that will allow the preparation and presentation of the financial statements; subject to this report; in pursuant to; the communique about the Uniform Accounting Plan and Registration Statement to be applied by Financial Leasing, Factoring and Financing Companies published on Official Gazette dated December 24, 2013; No: 28861; complying with the Regulation on Accounting Practices and Financial Statements of Financial Leasing, Factoring and Financing Companies, Turkish Accounting Standards, Turkish Financial Reporting Standards, and the other regulations, communiques, circulars and statements by Banking Regulation And Supervision Agency on the principals of accounting and financial reporting; and also in a way that does not involve any mistakes or false information with a significant level of importance due to misconduct. Statement on The Responsibility of the Authorized Audit Company As the company to do independent auditing, our responsibility is to provide opinion on the audited financial statements. Our independent audit is conducted in accordance with the regulation on Authorization and Activities of the Companies to Conduct Independent Audit in Banks and as well, international audit standards. It is planned and implemented sufficient independent audit, enough to provide reasonable liability, that the financial statements do not involve mistakes with significant importance. During the independent audit, audit techniques to collect audit evidence on financial statement explanations and footnotes and as well on the amounts mentioned in the financial statements are used. These techniques are left for the initiative of the independent auditors who we employ, however the determination of the suitable techniques are made by considering the effectiveness of the internal controls during the process of preparation and presentation of the financial statements and the appropriateness of the applied accounting policies. Hence, our aim is not providing opinion on the effectiveness of the internal control system, but to reveal the relationship between the financial statements, which are prepared by the Company management and the internal control system, in order to design our independent audit techniques suitable with the conditions. Enough and appropriate audit evidence had been provided to bring together the independent audit opinion stated below. Independent Auditor s Opinion According to our opinion, the accompanying financial statements, with all their significant parts, reflects s financial situation as of December 31, 2013 and its activity results and cash flows regarding the same period, correctly and in accordance with the regulations, communiqués, circulary and explanatory notes declared by the Banking Regulation and Supervision Agency on the basis of accounting and financial reporting. Güney Bağımsız Denetim ve Serbest Muhasebeci Mali Müşavirlik Anonim Şirketi A member firm of Ernst & Young Global Limited Seda Hacıoğlu, SMMM Partner, Head Auditor February 7, 2014 Istanbul, Turkey

18 Yapı Kredi Faktoring 2013 Annual Report 17 Financial Statements as of December 31, 2013 Contents Page Financial Statements 18 Off-Balance Sheet Items 20 Income Statement 21 Shareholders Equity Profit and Loss Account Statement 22 Statement Of Changes in the Shareholders Equity 23 Cash Flow Statement 24 Profit Distribution Statement 25 Explanatory Footnotes Regarding Financial Statements 26

19 18 Yapı Kredi Faktoring 2013 Annual Report Financial Statements as of December 31, 2013 December 31, 2013 December 31, 2012 ASSETS Footnote TP YP Total TP YP Total I. Cash, Cash Equivalents and Central Bank II. Fin. assets posted to P/L acc. at fair value(net) Financial assets held for trading Fin. assets posted to P/L acc. at fair value Derivative fin. assets held for trading III. Banks IV. Reverse repo accounts receivable V. Financial assets available for sale (net) VI. Factoring accounts receivable Discounted factoring accounts receivable Domestic International Unearned Income (-) (8.748) (29) (8.777) (4.755) (1.258) (6.013) 6.2 Other factoring accounts receivable Domestic International VII. Financial expenses Consumer loans Credit cards Business installment loans VIII. Leasing Leasing Accounts Receivable Financial Leasing Accounts Receivable Business Leasing Accounts Receivable Unearned Income (-) Investments Leasing Amounts Prepaid for Leasing IX. Other Accounts Receivable X. Nonperforming Loans Nonperforming factoring Accounts Receivable Nonperforming Financial Loans Nonperforming leasing accounts receivable Specific Reserve Funds (-) (73.009) - (73.009) (51.060) - (51.060) XI. Derivative financial assets for hedging purposes Fair value hedge Cash flow hedge Net international investment hedge XII. Marketable securities held to maturity (net) XIII. Subsidiaries (Net) XIV. Affiliates (Net) XV. Joint Ventures (Net) XVI. Tangible Assets (Net) XVII. Non-tangible Assets (Net) Goodwill Other XVIII. Cash Paid Expenses IXX. Current Period Tax Assets XX. Deferred Tax Assets XXI. Other Assets Sub Total XXII. Assets held for sale and discontinued operations Held for Sale Held for discontinued operations Total Assets The following notes from a part of these financial statements.

20 Yapı Kredi Faktoring 2013 Annual Report 19 Financial Statements as of December 31, 2013 December 31, December, 2012 Liabilities Note TP YP Total TP YP Total I. Derivative financial liabilities held for trading II. Loans Received III. Factoring Accounts Payable IV. Leasing Accounts Payable Financial Leasing Accounts Payable Business Leasing Accounts Payable Other Deferred financial leasing expenses ( - ) V. Marketable securities issued (Net) Bills Asset-backed securities Bonds VI. Other Debts VII. Other Liabilities VIII. Derivative financial liabilities for hedging purposes Fair Value Hedge Cash Flow Hedge Net international investment hedge IX. Taxes and liabilities due X. Provision for liabilities and expenses Provision for reorganization Provision for employee benefits Other provisions XI. Deferred Income XII. Current Period Tax Liabilities XIII. Deferred Tax Liability XIV. Subordinated Loan Sub total XV. Liabilities for non-current assets held for sale and discontinued operations (Net) For sale Relating to discounted operations XVI. Shareholders Equity Paid-in Capital Capital Reserve Share Premiums Profit from shares cancelled Other Capital Reserves Other comprehensive accumulated income or expenses not to be re-classified in case of Profit / Loss Other comprehensive accumulated income or expenses to be re-classified in case of Profit / Loss Profit reserves Legal reserves Statutory Reserves Extraordinary reserves Other profit reserves Profit / loss Profit / loss carried forward Current year s net profit / loss Total Liabilities The following notes from a part of these financial statements.

21 20 Yapı Kredi Faktoring 2013 Annual Report Off-balance sheet items for the financial year between 1 January and 31 December 2013 Independently Audited Independently Audited OFF BALANCE SHEET ITEMS December 31, 2013 December 31, 2012 Note TP YP TOTAL TP YP TOTAL I Irrevocable factoring contracts II Revocable factoring contracts III Guarantees received IV Guarantees given V Commitments Irrevocable commitments Revocable commitments Lease commitments Financial Lease commitments Business Lease commitments Other revocable commitments VI Derivative financial instruments Derivative financial instruments for hedging purposes Fair value hedge Cash flow hedge Net international investment hedge Derivative financial instruments held for trading Forward trading transactions Swap transactions Options transactions Futures transactions Others VII Marketable securities held in custody TOTAL OFF-BALANCE SHEET ACCOUNT The following notes from a part of these financial statements.

22 Income Statement for the financial year between 1 January and 31 December 2013 Yapı Kredi Faktoring 2013 Annual Report 21 INCOME AND EXPENSE ITEMS Note Independently Audited December 31, 2013 Independently Audited December 31, 2013 I. INCOME FROM OPERATING ACTIVITIES FACTORING INCOME Interest earned on factoring accounts receivable Discounts Other Factoring fees and commissions Discounts Others INCOME FROM FINANCIAL LOANS Interest earned on financial loans Financial loan fees and commissions - - LEASING INCOME Financial leasing income Business leasing income Leasing fees and commissions - - II. FINANCIAL EXPENSES (-) Interest paid for loans received Interest paid for factoring accounts payable Financial leasing expenses Interest paid for securities issued Other interest expenses Fees and commission paid III. GROSS P/L (I+II) IV. OPERATING EXPENSES (-) Staff costs Reserve fund expenses for severance pay Research & development expenses General administrative expenses Other V. GROSS OPERATING P/L (III+IV) VI. INCOME FROM OTHER OPERATING ACTIVITIES Interest received from banks Interest earned on reverse repo transactions Interest earned on marketable securities Interest earned on financial assets held for trading Income from fin. assets posted to P/L acc. at fair value Income from available-for-sale financial assets Income from investments held to maturity Dividends Profit from capital market transactions Profit from derivative financial transactions Other Foreign exchange gains Other VII. SPECIFIC RESERVE FUND NONPERFORMING LOANS (-) VIII. OTHER OPERATING EXPENSES (-) Impaired marketable securities Impaired fin. assets posted to P/L acc. at fair value Loss from available-for-sale financial assets Loss from investments held to maturity Impaired non-current assets Impaired non-current assets Impaired non-current assets held for sale and discontinued operations Impaired goodwill Other impaired non-current assets Impaired investments in affiliates, subsidiaries and joint-ventures Loss from derivative financial transactions Foreign exchange loss Other IX. NET OPERATING PROFIT/LOSS (V+ +VIII) X. SURPLUS AMOUNT RECOGNIZED AS INCOME AFTER MERGER - - XI. NET MONETARY POSITION PROFIT/LOSS - - XII. BEFORE-TAX PROFIT/LOSS FROM CONTINUING OPERATIONS (IX+X+XI) XIII. RESERVE FUND FOR TAX ON CONTINUING OPERATIONS (±) Provision for current taxes Expense effect of deferred taxes (+) Income effect of deferred taxes (-) - XIV. NET ANNUAL PROFIT/LOSS FROM CONTINUING OPERATIONS (XII±XIII) XV. INCOME FROM DISCONTINUED OPERATIONS Income from available-for-sale financial assets Profit on affiliates, subsidiaries and joint-ventures sold Other income from discontinued operations - - XVI. LOSSES FROM DISCONTINUED OPERATIONS (-) Expenses for available-for-sale financial assets Loss on affiliates, subsidiaries and joint-ventures sold Expenses for other discontinued operations - - XVII. BEFORE-TAX PROFIT/LOSS FROM DISCONTINUED OPERATIONS (XV-XVI) - - XVIII. RESERVE FUND FOR TAX ON DISCONTINUED OPERATIONS (±) Provision for current taxes Expense effect of deferred taxes (+) Income effect of deferred taxes (-) - - XIX. NET ANNUAL PROFIT/LOSS FROM DISCONTINUED OPERATIONS (XVII±XVIII) - - XX. NET ANNUAL PROFIT/LOSS (XIV+XIX) EARNİNGS PER SHARE 4,68 3,17 Earnings per share from continuing operations 20 4,68 3,17 Earnings per share from discontinued operations - - EARNINGS PER DILUTED SHARE - - Earnings per share from continuing operations - - Earnings per share from discontinued operations The following notes from a part of these financial statements.

23 22 Yapı Kredi Faktoring 2013 Annual Report Statement of income and expenses recognized in shareholders equity for the financial year between 1 January and 31 December 2013 Independently Audited December 31, 2013 December 31, 2012 I. PROFIT/LOSS OF THE PERIOD II. OTHER COMPREHENSIVE INCOME Not to be re-classified on Profit/Loss Tangible assets revaluation adjustments Intangible assets revaluation adjustments Defined Benefit Plans Reevaluation Gains / Losses Other Comprehensive Income Components that will not be Reclassified As Other Profit Or Loss Taxes regarding other comprehensive income that will not be reclassified in profit or loss Current tax expense/income Deferred tax expense / income To be reclassified on profit or loss Foreign exchange conversion differences Revaluation and/or reclassification income/expenses of Available-for-sale financial assets Cash flow risk protection income/expenses Investment risk protection income/expenses regarding foreign businesses Other Comprehensive Income Items that would be reclassified in profit or loss Taxes regarding other comprehensive income that will be reclassified in profit or loss - (2.715) Current Tax Expense / Income Deferred Tax Expense / Income - (2.715) III. TOTAL COMPREHENSIVE INCOME (I+II) The following notes from a part of these financial statements.

24 Yapı Kredi Faktoring 2013 Annual Report 23 Statement of changes in Equity for the financial year between 1 January and 31 December 2013 CHANGES IN EQUITY Other Accumulated Comprehensive Income and Expenses that will not be reclassified on profit or loss Other Accumulated Comprehensive Income and Expenses that will be reclassified on profit or loss BİN YENİ TÜRK LİRASI Paid-in Capital Inflation adjustment for paid-in capital Share premium Profit from shares cancelled Other capital reserve Profit Reserves Legal Reserves Status Reserves Extraordinary Reserves Other Profit Reserves Term Profit / (Lossı) Previous Term Profit / (Loss) Term Net Profit or Loss Total Shareholders Equity PREVIOUS YEAR (31/12/2012) I. Opening Balance II. Revisions according to TAS Effect of corrections 2.2 Effect of changes in the Accounting Policy III. New Balance (I+II) IV. Total Comprehensive Income V. Capital Increase with cash VI. Capital Increase with Internal Resources VII. Capital Reserves Due To Inflation Accounting VIII. Convertible Bonds IX. Subordinated Loans X. Increase/Decrease due to Other Changes XI. Current Net Profit / Loss XII. Profit Distribution (15.776) (9.714) 12.1 Dividend (40.000) (40.000) 12.2 Amount transferred to reserves (15.776) Other (*) (30.286) (30.286) Closing Balance (III+IV+...+XI+XII) CURRENT PERIOD (31/12/2013) I. Previous Closing Balance II. Revisions according to TAS Effect of corrections 2.2 Effect of changes in the Accounting Policy III. New Balance (I+II) IV. Total Comprehensive Income V. Capital Increase with cash VI. Capital Increase with Internal Resources (12.576) (2.539) VII. Capital Reserves Due To Inflation Accounting VIII. Convertible Bonds IX. Subordinated Loans X. Increase/Decrease due to Other Changes ( ) ( ) XI. Current Net Profit / Loss XII. Profit Distribution Dividend 12.2 Amount transferred to reserves (24.735) 12.3 Other (53.342) Previous year adjustment effect (**) Closing balance (III+IV+...+XI+XII) (*)After disclosure of the financial statements dated December 31, 2011 on February 22, 2012, the Company Management, at the end of March 2012, declared; regarding a client with the amount of TRY , being followed in their Factoring Accounts Receivables account, within the asset items of the balance sheet as of 31 December 2011; that, they have identified irregularities made by the client, on some assigned records, such as invoices, customs declarations, consignments etc., and therefore the cash proceeds could not be done, and as a result these receivables became receivables regarded as loss, the receivable amount of TRY from this client had been classified and recognized in the Company balance sheet dated March 31, 2012 as receivables regarded as loss, and a special reserve had been saved for the total receivable. In Turkish Accounting Standards 10 the provision of; if an event that needs adjustment occurs after the reporting period (balance sheet date), the enterprises are obliged to adjust the figures recognized in the financial statements, according to this new position, (on Events After Reporting Period (balance sheet date); is in command. Therefore as the company, which audited The Company s financial statements dated December 31, 2011; the financial statements of the company, which were prepared as of December 31, 2011 and published on February 22, 2012; had been retrospectively adjusted, in a way to include the value loss that is mentioned above; in pursuant to the item 46 of the Regulation Regarding the Authorization and Activities of the Corporations to Run Independent Audit within Banks, published in the Official Gazette, dated November 1, 2006, No: The mentioned adjustment had been made in accordance with the report, which was sent by BRSA to the Company, on November 26, The capital movement item, which is recognized under the Other item, shows the effect of the related adjustment to the previous year profit and loss account including tax. (**) As to the financial statements dated December 31, 2011; the difference in the balance regarding the adjusted factoring accounts receivable; had been adjusted in the previous year s profits account. The following notes from a part of these financial statements.

25 24 Yapı Kredi Faktoring 2013 Annual Report Cash Flow Statement for the financial year between 1 January and 31 December 2013 Independently Audited Independently Audited Note 31 December December 2012 A. Cash flow from operating activities 1.1 Operating profit before changes in operating assets and liabilities Interest/leasing income Paid interests/leasing expenses (34.150) (54.603) Leasing expenses Dividends received Fees and commissions received Other income - (30.519) Collected out of non-performing and written-off accounts receivable Cash payments to staff and service providers (12.151) (8.483) Taxes paid 18 (10.119) (4.786) Other (21.607) (12.325) 1.2 Change in operating assets and liabilities ( ) (21.046) Net decrease (increase) in factorings accounts receivable ( ) Net decrease (increase) in financial loans Net decrease (increase) in leasing accounts receivable Net decrease (increase) in other assets 144 (180) Net decrease (increase) in factorings accounts payable (3.832) Net decrease (increase) in leasing accounts payable Net decrease (increase) in loans received ( ) Net decrease (increase) in debts due Net decrease (increase) in other debts 846 (600) I. Net cash flow from operating activities (88.991) B. Cash flow from investing activities Acquisition of affiliates, subsidiaries and joint-ventures Proceeds from sale of affiliates, subsidiaries and joint-ventures Purchase of tangible and intangible assets 11,12 (265) (289) 2.4 Proceeds from sale of tangible and intangible assets 11, Purchase of available-for-sale financial assets Proceeds from sale of available-for-sale financial assets Purchase of held-to-maturity investments Proceeds from sale of held-to-maturity investments Other II. Net cash flow from investing activities (40) C. Cash flow from financing activities Funds borrowed and stocks and bonds issued Funds repaid and stocks and bonds repurchased Capital market instruments issued Dividend payments - (40.000) 3.5 Financial leasing payments Other - - III. Net cash flow from financing activities - (40.000) IV. Effects of exchange rate changes on cash and cash equivalents (185) 12 V. Net decrease (increase) in cash and cash equivalents (400) VI. Cash and cash equivalents at beginning of year VII. Cash and cash equivalents at end of year The following notes from a part of these financial statements.