Analyst & Investor Day

Analyst & Investor Day Strategy - Outlook for 2015 and Beyond 19 February 2015

Management Mr. Adnan Bali Director and Chief Executive Officer Mr. Mahmut Magemizoğlu Deputy Chief Executive Mr. Suat İnce Deputy Chief Executive Mr. Hakan Aran Deputy Chief Executive 29 years at İşbank 32 years at İşbank 28 years at İşbank 25 years at İşbank Financial Management, Investor Relations, Managerial Reporting and Internal Accounting Corporate, Commercial and SME & Micro Business Banking Marketing, Sales and Product Management, Free Zone Branches Digital Banking, Information Technologies and Data Management Mr. Levent Korba Deputy Chief Executive Mr. Ertuğrul Bozgedik Deputy Chief Executive Mr. Yalçın Sezen Deputy Chief Executive Mr. Rıza İhsan Kutlusoy Deputy Chief Executive 29 years at İşbank 29 years at İşbank 28 years at İşbank 27 years at İşbank Operations, Support Services and Purchasing, Foreign Trade and Commercial Loan Operations, Internal Operations Management, Construction and Real Estate Management, Branch Network Development Corporate Loans, SME Loans, Commercial Loans and Consumer Loans Underwriting, Loan Portfolio Management Consumer Loans, Card Payment Systems, Retail Banking Marketing, Sales and Product Management, Private Banking Marketing and Sales Management Human Resources, Enterprise Architecture, Strategy and Corporate Performance Management and Talent Management Ms. Senar Akkuş Deputy Chief Executive Mr. İlhami Koç Deputy Chief Executive Mr. Yılmaz Ertürk Deputy Chief Executive Mr. Ergün Yorulmaz Deputy Chief Executive 24 years at İşbank 29 years at İşbank 28 years at İşbank 32 years at İşbank Treasury Management, Corporate Communications Management Equity Participations, Capital Markets, Cross Border Banking and Foreign Branches Economic Research, International Financial Institutions Legal Counsellorship, Financial Analysis, Commercial and Corporate Loans and Retail Loans Monitoring and Recovery Management 1

Changing Environment - Evolving Trends GDP and Loan Growth (%) CPI and Interest Rates (%) 6.9 33.9 9.2 29.9 8.8 16.4 31.8 18.5 16.0 16.0 17.0 13.6 8.7 8.4 9.6 10.4 6.9 10.3 8.0 7.4 7.2 2.1 4.1 3.0 3.5 4.0 4.5 Real GDP Growth Loan Growth 6.5 6.4 6.2 7.4 8.2 7.0 6.3 6.0 CPI Interest Rate* -4.8 2009 2010 2011 2012 2013 2014F 2015F 2016F 2017F 2009 2010 2011 2012 2013 2014 2015F 2016F 2017F Annual Growth (%) - Banking Sector (*) Annual compounded yield in Turkish treasury auctions 40 30 20 10 Loans Deposits Transformation from a high to a more balanced and sustainable economic growth cycle Improved CAD/GDP ratio from high single digit levels to 5% Continued prudent fiscal stance Decreasing inflation and interest rates More stable and predictable operating environment for banks 0 2009 2012 2011 2013 2014 2015F 2016F 2017F Reasonable loan growth Source: CBRT, Turkstat, Treasury, BRSA (F) İşbank Forecasts 2

Our Core Strengths Strong Corporate Culture Reliable employer - Loyal employees Business ethics Social responsibility Trust and reputation Leadership In Local Market Leader among private banks Large ATM and branch network Strong and trusted brand Large customer base with sustained loyalty High Quality Services Strong customer focus Efficient multiple distribution channels Effective leverage of customer digital foot print Adaptation of technology and embracing innovation Enhanced Risk Discipline Diversified loan portfolio Prudent risk management Effective alignment of craftsmanship and technology Diversified Earnings Focus Leader in customer reach and convenience Strong organic growth Serving a well-segmented, wide customer base Expansion in the region Stable & Diversified Funding Base Large deposit funding Significant share of demand deposits Large amount of small - size retail deposits International fund raising capability based on relationship and financial strength SUSTAINABLE & PROFITABLE GROWTH 3

Strategic Approach - 2012 and Onwards... Sustainable & Profitable Growth Profitability Asset Quality Well-balanced, Selective and Prioritized Growth Effective Risk Management Proactive Management of Funding 4

Well-Balanced, Selective and Prioritized Growth in a Changing Environment Sector Loan Growth 2010-34.2% 2014-18.5% Sector CAR 2009-20.9% 2014-16.4% Sector Loan / Deposit 2009-74.0% 2014-112.3% Changing Environment GDP 2010-9.2% 2014F - 3.0% Sector NIM 2009-5.7% 2014-3.8% 5

Well-Balanced, Selective and Prioritized Growth Well Segmented Customer Base(1) Private High Net worth Corporate Corporate Total Loan Growth 2013 2014 2015E 26.4% 15.2% 16% - 17% Affluent Commercial Non-Retail Loan Growth SME Growth 26.4% 20.4% 17.2% 16% - 17% 21.4% 17% - 18% Retail Mass Affluent SME & Micro Business Commercial Micro Growth (Micro + SME) / Non-Retail Retail Loan Growth 51.8% 22.3% 26.2% 54.3% ~50% 24.9% ~27.7% 10.2% 17% - 18% Mass GPL Growth (including overdraft acc.) 32.6% 22.8% >18% Strong core deposit base Diversified loan portfolio 2014 Retail Commercial Corporate Private Wide Product Portfolio Share in Loans 24.1% 41.7% 34.0% 0.2% Banking Services Capital Markets Treasury International Banking Financial Subsidiaries Share in Deposits 48.1% 21.9% 15.6% 14.4% (1) According to internal business segment definitions given in Appendix page. 6

Transformation of Asset Structure for Profitable Growth Asset Composition Loan Growth (TL bn) 3.1% 15.2% 8.9% 9.9% 9.9% 11.7% 10.9% 1.4% 0.8% 0.6% 0.7% 0.6% 34.7% 42.7% 34.5% 48.7% 26.5% 56.7% 21.7% 17.5% 17.2% 60.8% 64.1% 65.3% Liquid Assets(1) Securities Loans Other Assets 48.3 İşbank CAGR: 26.3% Peer Average CAGR: 24.8% 91.6 64.2 106.7 134.8 155.3 Loans Gross Cost of Risk(2) 7.4% 7.9% 6.9% 7.6% 6.8% 6.6% 2009 2010 2011 2012 2013 2014 2009 2010 2011 2012 2013 2014 The largest asset base - #1 with 12.6% market share in 2014(3), TL 18.9 billion higher than the closest peer(4) Successfully transformed asset mix Loans/Total Assets 65% Effective risk management 64 bps gross CoR Proactive management of securities portfolio Sustained strong liquidity for sustainable and profitable growth with loan growth stronger than peer average - CAGR 26.3% Sustainable and profitable growth: Relatively higher growth Relatively lower NPL (1) Liquid assets include cash, Central Bank and banks items. (2) Specific Provisions / Average Loans (3) Among private banks. Market share calculation is based on weekly BRSA data. (4) Peer banks are defined as the closest 3 private sector banks. 7

Sustained Superior Asset Quality Gross NPL Formation Rate(1) Gross Cost of Risk(2) 4.2% 4.8% İşbank Peer Average 2.7% 3.1% İşbank Peer Average 1.8% 2.3% 1.5% 2.0% 1.8% 1.7% 1.2% 1.4% 0.8% 0.9% 1.1% 1.1% 1.2% 1.2% 1.3% 1.2% 0.6% 0.6% 0.7% 0.6% 2009 2010 2011 2012 2013 2014 2009 2010 2011 2012 2013 2014 23.5% 30.1% 30.0% 28.5% Collection Rate(3) 33.3% 31.3% 25.4% 24.3% 20.0% 18.9% 28.8% 16.5% İşbank Significantly lower NPL generation compared to peer average 47 bps lower gross NPL formation rate in 2014 157 bps better in group II loans/total loans Provisioning policy in line with the BRSA regulation and signficantly lower gross CoR compared to peer average 50 bps Peer Average Well-designed, well-managed collection system, effectively decreasing Net CoR (29 bps in 2014)(4)... 2009 2010 2011 2012 2013 2014 (1) Gross NPL Formation / Average Loans (2) Specific Provisions / Average Loans (3) Collections / (Prior period ending balance NPL + Additions) (4) (Specific Provisions - Released Provisions) / Average Loans which differentiates İşbank from its peers in NPL, contributing to lower NPLs: İşbank 1.5% Closest peer 1.8% 2014 Peer average 2.6% 8

Decision Support Systems Risk Management Sales and Marketing Total Loans NPL Ratios by Loan Categories (2014) 1.5% 2.8% Performance Management Decision Support Systems Underwriting Corp.&Comm. SME(1) Credit Cards 0.8% 2.1% 1.9% 3.1% 4.0% 6.2% İşbank Sector Consumer 1.6% 2.5% Monitoring Pricing Share of Group II Loans in Total Loans Decision Support System Rating Segment / Product Corporate, Commercial 4.8% İşbank Peer Average Corporate & Commercial Behavioral Scorecard SME & Micro Application Scorecard SME & Micro Behavioral Scorecard Corporate, Commercial SME, Micro SME, Micro 4.5% 2.8% 2.1% 3.1% 3.3% 2.8% Agri-business Application Scorecard Agri-business Mortgage, GPL, 2.2% 1.6% 1.8% 1.5% 1.7% Retail Application & Behavioral Scorecard Credit Card, Car Loan, Overdraft (1) SME definition is according to BRSA. 2009 2010 2011 2012 2013 2014 9

Proactive Funding Management - Deposits Composition of Total Funding (TL bn) TL Demand Deposits / TL Deposits(1) İşbank 22.0% 22.5% 134 Deposits 56.2% Peer Average 63.7% 20 21 18 29 16 Non-Deposits 15.2% 13.6% 15.7% 14.3% 16.8% 14.7% 17.6% 15.4% 17.9% 17.0% 2009 2010 2011 2012 2013 2014 2014 2009 2010 2011 2012 2013 2014 10.4% growth in total deposits in 2014 Continued focus on proactive management of the high-end of the deposit base - Opportunistic utilization of alternative funding sources and sustained leadership 12.7% market share in 2014(2) High and stable share of TL demand deposits 22.5% in TL(1) deposits, significantly supporting the funding cost - ~170 bps in 2014(3) Highest share of retail deposits covered by SDIF guarantee in total deposits reflects wider spread of the deposit base 548 bps above the closest peer 2015 total deposits growth target - 16%-17% (1) Excluding interbank deposits. (2) Among private banks. Market share calculation is based on weekly BRSA data. (3) MIS data (4) The amount of the deposit guarantee limit was increased by Savings Deposit Insurance Fund (SDIF) from 50,000 TL to 100,000 TL by the regulation in February 2013. Deposits Covered by SDIF Guarantee / Total Deposits(4) 28.2% 23.1% 26.1% 20.9% 18.7% İşbank Peer Average 24.7% 24.3% 18.1% 30.4% 30.0% 21.7% 21.5% 2009 2010 2011 2012 2013 2014 10

Proactive Funding Management Non-Deposit Funding Composition of Non-Deposit Funding (TL bn) Evolution of Non-Deposit FX Funding Base (USD mn) 14,110 1,400 20 21 18 29 16 Securities Issued (Inc. Subdebt) Funds Borrowed REPOs & Money Market Shareholders Equity Other Liabilities 4,932 1,440 2,145 1,267 3,750 4,171 1,068 Subordinated Debt Issuance Eurobonds - Private Placements Eurobonds - Public Offering Bilateral Loans Securitisation Syndication 2009 2010 2011 2012 2013 2014 2014 1,347 2,454 2009 2014 Syndication Securitisation Bilateral Loans 1 year Eurobonds - Public Offering Eurobonds - Private Placements 5-14 years 6 months - 15 years 5-7 years 3 months - 5 years Subordinated Debt Issuance 10 years Effective funding base management by tapping different segments of the market for increasing cost optimization and maturity management: Share of Funds Borrowed + Securities Issued: 8.6% - 2009 17.3% - 2014 Regular borrower in syndication and securitisation markets Increased cooperation with supranational financial institutions Securities Issued in TL and FX (inc. subordinated debt) as a new source of funding with leadership in the market 11

Outcomes of Our Strategy - 2012 and Onwards For the first time, Highest reported net profit Highest CAR Lowest NPL achieved at the same time* *Among peers 12

Securities Portfolio Breakdown of Securities (TL mn) Yield of Securities(1) 39,290 36,866 40,856 17.4% 17.8% 30.3% 11.22% 10.02% 10.03% 17.7% 25.2% 30.9% 22.4% 27.4% 18.3% FX CPI Linkers TL Floating (excl. CPI Linkers) TL Fixed 4.36% 4.49% 4.58% TL FX 26.8% 29.3% 36.5% 2009 2013 2014 2012 2013 2014 Liquid securities portfolio managed proactively to benefit from changing interest rate environment. Securities portfolio contribution to interest revenue TL 3,346 mn in 2014 20.8% of total interest revenue Interest income from CPI linkers 2013: TL 1,334 mn 2014: TL 1,249 mn (1) MIS data Proactively increased share of TL fixed rate securities based on interest rate environment 13

Spread & Margin TL Loan-Deposit Spread(1) FX Loan-Deposit Spread(1) 13.94% 11.51% 12.32% 5.36% 5.19% 5.03% 7.67% 6.11% 7.33% TL - Yield 2.55% 1.99% 1.69% FX - Yield 6.27% 5.40% 5.00% TL - Cost TL - Spread 2.82% 3.19% 3.34% FX - Cost FX - Spread 2012 2013 2014 2012 2013 2014 4.24% 4.08% NIM(1) 3.89% 2014 Higher interest rates led to slight tightening in TL loan-deposit spread - 40 bps. FX loan-deposit spread continued to support profitability by widening 15 bps. Sustained yield of securities porfolio Resulting in slight contraction in NIM - 19 bps (1) MIS data 2012 2013 2014 Outlook for 2015 Sustained NIM with continued focus on funding cost management and effective asset pricing 14

Fee & Commission Income Gross F&C Income Compositon (TL mn) Components of Net F&C Income Growth 1,355 2,335 18.3% 20.0% 38.9% 3.3% 7.6% 17.2% 7.0% 45.6% 9.2% 6.3% 11.9% 14.7% 2009 2014 Lending Mutual Funds Credit Cards Fund Transfer Account Keeping Other Lending Related 34.9% 32.2% 31.1% Credit Cards 27.7% 24.8% 22.6% Other 11.3% 5.4% 6.1% 4.3% -2.2% -2.1% -2.7% -11.0% -15.7% 2010 2011 2012 2013 2014 Impact of retail-targeted new regulations and base effect of refinancing fees limited the growth of F&C income. Adjusted for refinancing fees, other F&C income growth was 6.6% in 2014 Foreign trade transactions with more than 230 countries with 50 bps increase in market share in 2014 Gross F&C income from digital channels has reached 13.6% of the total. Continued focus on growing F&C revenues 2015E 7% - 8% 15

Operational Efficiency Loans and Deposits per Employee (2014) Employees per Branch Thousand TL İşbank İşbank 5,494 6,389 20.6 21.0 20.7 19.5 Peer Average Peer 1 Peer 2 6,320 7,020 6,953 7,717 Deposits per employee Loans per employee 18.4 17.6 17.1 17.1 18.4 17.3 17.9 17.6 Peer 3 6,022 6,916 2009 2010 2011 2012 2013 2014 Cost / Income and Cost / Av. Assets Average employee per branch brought down significantly, which is now close to peer average. 41.2% 44.6% 46.2% 2.4% 2.4% 2.3% Cost/Income(1) Continuous effort to increase per employee loan and deposit volumes migrating operations from branches to Op. Center increasing customer focus in branches 2012 2013 2014 2012 2013 2014 (1) Adjusted for non-recurring and other expense items. Cost/Average Assests(1) Slight decline in cost-to-assets ratio in 2014, slightly increased C/I ratio driven mainly by IT related and other operational expenses limited growth in F&C and decline in trading income Focus on efficiency and cost-saving measures will continue with an outlook of driving C/I ratio below 45% in 2015. 16

Distribution Channels Non-Branch Customers (1,000) Channel Usage - # Transactions 80.7% 2.2% 4.3% 9.4% 19.0% 61.2% 6,316 8,160 Number of Mobile Customers Number of Internet Customers 37.6% 36.1% 4.7% 5.1% 35.7% 4.4% 29.1% 3.7% Mobile Internet Branch Telephone Branch 1,280 1,452 2,220 Number of ATM Customers Share of Non-Branch Channels(1) 30.3% 32.0% 31.1% 28.8% Bankamatik (ATM) Branch 102 25.2% 22.4% 19.5% 19.3% 2009 2014 2011 2012 2013 2014 Digital banking 2014; 1.8 million digital channel sales 2.2 billion digital banking transactions Strong growth in usage of digital channels: 80.7% of transactions Digital banking; Mobile banking Internet banking Transformation, innovation and strong growth Mobile banking transactions;(2) 1 in every 2 investment transactions 1 in every 3 bill payments 1 in every 4 financial transactions ATM: the largest network with 6,290 ATMs More than 130 services POS: more than 380K Optimization Cost Management (1) Only the transactions which can be carried through both branches and non-branch channels are taken into account. (2) Based on internet and mobile banking statistics of the Banks Association of Turkey. 17

Participations Shift in Mix with a Strategic Focus Shift in Mix - Focus on Financial Sector(1) Portfolio Sales (2000-2014) 2014 44% 19% 17% 29% 8% 42% 14% 8% 6% 28% Banks Insurance Financial Institutions Glass 2000 2014 No of Participations(3) Participations / Total Assets Participations / Shareholders Equity 81 15% 70% 25 4% 33% 2000 6% 13% 10% 42% 10% 18% Telecom Other Revenue Profit USD 1,816 mn USD 609 mn Dividend Income / Book Value of Participations(2) Cash Dividend Bonus Shares USD 759 mn USD 1,852 mn IRR: 25% 12.2% Strategic Outlook : 8.4% 9.3% 8.4% 8.8% 10.7% Divestiture of other non-core, non-strategic companies Sustain policy of enhancing the alignment and return of the financial sector investments Ensuring a stable and satisfactory dividend revenue 2009 2010 2011 2012 2013 2014 (1) Ratios are calculated using book value. (2) Mark-to-market gains are excluded from the book value of participations. (3) Including companies booked under available for sale securities porfolio. Continue to unlock and communicate value through restructuring within glass group 18

Strong Value Creation Equity Growth Dividends Reinvested at ROE (TL mn) Dividends Distributed to Shareholders (TL mn) 23.2% 23.2% 20.3% 20.1% 17.5% 13,494 13,494 17,647 633 17,014 CAGR: 20.1% 25,075 2,356 19,420 1,499 33,780 26,992 4,469 3,413 17,921 22,719 23,579 29,311 Cash Dividens Reinvested at ROE Shareholders Equity 12.6% 551 297 14.2% 691 380 13.9% 543 339 665 18.5% 489 555 14.0% 427 İşbank Payout Ratio Peer Average Payout Ratio İşbank Peer Average 2009 2010 2011 2012 2013 2014 2009 2010 2011 2012 2013 CAR & Tier I Ratio Strong value creation, highest among peers: 20%+ adjusted 18.3% 17.0% 17.5% 15.7% 16.3% 14.1% 13.0% 13.0% 14.4% 11.6% 16.0% 13.6% CAR average equity growth for the last 5 years Highest dividend distribution among peers Tier I Ratio Highest CAR among peers 2009 2010 2011 2012 2013 2014 19

Outlook 2015 and Strategic Priorities Going Forward İşbank 2015 Expectations Loan Growth 16% - 17% Capital Adequacy Ratio >15% Retail Loans Other Loans Deposit Growth Share of Securities in Total Assets NPL Ratio 17% - 18% 16% - 17% 16% - 17% ~17% + 20-30 bps Net Interest Margin Net Fees & Commissions Growth OPEX Growth Return on Average Assets 3.7% - 3.9% 7% - 8% 4% - 5% 1.4% - 1.6% Gross Cost of Risk(1) 85-95 bps Net Branch Additions 40-45 (1) (Specific + General Loan Loss Provisions) / Average Loans Strategic Priorities 2017 Sustained performance in superior asset quality Improving margin Focus on fee growth Effective cost management NPL % NIM Fees & Commissions / Total Banking Income Cost/Income 20

Appendix Segment Definitions Private Banking Business Unit High Net Worth Assets Under Management (AUM) + Funds Under Management (FUM) 1 million TL or Maximum of the last 12 months' month-end balance + credit balance 1 million TL Retail Banking Business Unit Affluent 100,000 TL AUM or 200,000 TL AUM + FUM Mass Affluent 40,000 TL AUM < 100,000 TL or 80,000 TL AUM + FUM < 200,000 TL Mass AUM < 40,000 TL and AUM + FUM < 80,000 TL Corporate Banking Business Unit Corporate Turnover 30 million USD or Credit Limit 10 million USD Alternative Criteria: AUM 12 million USD Commercial Banking Business Unit Commercial 5 million USD Turnover < 30 million USD or 1 million USD Credit Limit < 10 million USD or 6,5 million USD Total Banking Industry Risk Alternative Criteria: 1 million USD AUM < 12 million USD Small and Medium Size Enterprises 1 million USD Turnover < 5 million USD or 60,000 USD Credit Limit < 1 million USD or 400,000 USD Total Banking Industry Risk 6,5 million USD Alternative Criteria: 300,000 USD AUM < 1 million USD Micro Business Turnover < 1 million USD and Credit Limit < 60,000 USD 21

Disclaimer The information in this document has been obtained by Türkiye İş Bankası A.Ş. ( İşbank ) from sources believed to be reliable, however, İşbank cannot 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 İşbank to the public and the relevant corporations are accepted to be the sole material. İşbank does not accept any liability whatsoever for any direct, indirect or consequential loss arising from any use of this document or its contents due to the misleading information in this document. All estimations, opinion, all forward looking statements and projections expressed, implied, contained in this document are the current beliefs or expectations of İşbank s management as of the date of this document and are subject to significant risks, uncertainties and changes in circumstances. Actual results, performance or events could differ materially from those expressed or implied in the estimations, opinions and forward-looking statements in this document. All estimations, opinions and forwardlooking statements contained in this document can be subject to change without notice. İşbank expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any estimations, opinions, forward-looking statements contained in this document to reflect any change in İşbank s expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based. This document can not be interpreted as an advice to the investors or as an offer or solicitation for the purchase or sale of any financial instrument or the provision of an offer to provide investment services and İşbank can not be held responsible for the results of investment decisions made on account of this document. This document has been issued specially to the person, whom the document is concerned and may not be reproduced, distributed, published or shared with third parties for any purpose. All rights of İşbank are reserved. 22