Türkiye Halk Bankasi (HALKB) Q1 2024 earnings summary

Executive summary

• Total assets reached TRY 2.52 trillion as of March 2024, up 9.8% from December 2023, driven by securities growth while loan growth remained subdued due to tight financial conditions.

• Net profit for Q1 2024 was TRY 5.6 billion, a 19.1% increase year-over-year, with strong interest and fee income.

• Asset quality remained strong with an NPL ratio of 1.5%, below the sector average, and high coverage ratios.

• The bank remains the market leader in SME loans, with a 17.3% share and 56% of commercial loans allocated to SMEs.

• Capital adequacy ratio stood at 13.34%, above regulatory requirements.

Financial highlights

• Interest income surged 178.3% year-over-year to TRY 139.1 billion, with loan interest up 219.8% and securities interest up 99.9%.

• Net interest income rose 18.6% sequentially and 178.4% year-over-year to TRY 15,887 million.

• Net fees and commissions income increased 16.7% sequentially and 167.6% year-over-year.

• Operating expenses increased 2.1% sequentially and 38.1% year-over-year, mainly due to wage growth.

• Return on equity (ROE) was 16.5% and return on assets (ROA) was 1.1% for Q1 2024.

Outlook and guidance

• Management expects stable economic growth in Türkiye, supported by structural reforms and a focus on inflation control.

• The bank aims to maintain its leadership in SME lending and continue expanding digital banking services.

• Digitalization remains a focus, with digital transactions up 31% year-over-year and active digital customers up 11%.

• Liquidity and capital positions are expected to remain robust, with ongoing monitoring of market and regulatory developments.