Garanti Bank Investor Presentation January 2014

NOT A COINCIDENCE

ROAE

17.7% BASEL II CAR

~15%

12.4 MILLION *

CUSTOMERS

2

WE ARE ADDING VALUE TO THE ECONOMY AND SOCIETY

2nd LARGEST PRIVATE BANK

by assets of

US $ 106 BN

Note: Figures are based on BRSA consolidated financials as of September 30, 2013 *As of January 22, 2014 **Banking revenues defined as; Net interest income adjusted with provisions and net trading gains/losses+Net Fees & Commissions

Focused on Relationship Banking with Broad Geographical Coverage & Omni-Channel Distribution Network > 1,000 branches*

> Leading internet and mobile banking > Largest financial call center > ~4,000 ATMs *

> Targeted investments to digital platforms

Robust Balance Sheet > Highly liquid > Well-capitalized (Basel II CAR: ~15%) > Low risk (NPL Ratio: 2.4%)

#1 IN BANKING REVENUES**

~50% Free Float > Jointly controlled by Dogus (24.23%) & BBVA (25.01%) > ~94% foreign ownership in the free float

3

EMPOWERING

SUSTAINABLE

RESPONSIBLE

READY FOR FUTURE

RESPONSIBLE TOWARDS SOCIETY

ECOSYSTEM AWARENESS

Operating in a Large and Dynamic Economy

5

90

110

130

150

170

190

210

230

2002 2006 2010 2014 2018

EU27 LATAM CEEMEA TURKEY

Rea

l GD

P G

row

th (

Reb

ased

)

High and Sustainable Real GDP Growth

2003-9M13 CAGR: 18%

Avg. GDP growth *

>5% over 2002-2012 LATAM: 3.6%

EU 27: ~1.3% CEEMEA: ~4%

*Source: IMF. CEEMEA countries include Bulgaria, Croatia, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, Russia, Slovakia, Slovenia, South Africa. LATAM Countries include Argentina, Brazil, Colombia, Ecuador, El Salvador, Mexico, Paraguay, Peru **Source: EBF Banking Sector Statistics Database 2012, ranking per total assets as of 2011 ***BRSA Monthly data for commercial banks as of September 2013. US$/TL:1.995

RESPONSIBLE

vs.

$ 748bn***

6

Total Population by Age*

no growth in EU and negative growth in CEEMEA

Population to reach

*Source: Eurostat, as of 2010 **Population Division of the Department of Economic and Social Affairs of the United Nations Secretariat, World Population Prospects: The 2010 Revision

28%

27%

27%

29%

29%

43%

55%

58%

56%

58%

56%

50%

17%

16%

17%

14%

15%

7%

EU27

CzechRepublic

Hungary

Poland

Romania

Turkey

0-25 yrs 25-65 yrs 65+ yrs

74mn

21mn

38mn

10mn

10mn

500mn

ECOSYSTEM AWARENESS

Turkey with Young and Growing Population

vs.

59% under 35

RESPONSIBLE

ECOSYSTEM AWARENESS

Underpenetrated Market with Strong Growth Potential

RESPONSIBLE

Attractive Demographics

Underpenetrated Market

7

58% 39%

13%

98%

56% 59%

329%

115% 113%

Bank Assets / GDP Customer Deposits / GDP Loans / GDP

Turkey - 2002 Turkey - 3Q13 Euro Area - 3Q13

Source: ECB, TUIK, BRSA for commercial banks

75.8

115.3

60

100

140

Sep-07 Mar-08 Sep-08 Mar-09 Sep-09 Mar-10 Sep-10 Mar-11 Sep-11 Mar-12 Sep-12 Mar-13

8

Deposits fund 57% of assets*

Comfortable level of Loans/Deposits at 105%*

* BRSA monthly data for commercial banks, as of September 2013 ** CBRT Financial Stability Report, May 2013. Liquidity Ratios are as of April 2013.

ECOSYSTEM AWARENESS

Highly Liquid Banking Sector

Deposit-heavy funding structure

Comfortable liquidity

levels

Liquidity Adequacy Ratios** well-above required levels Total Liquidity Ratio – Weekly: 166%; Monthly: 120% FC Liquidity Ratio – Weekly: 167%; Monthly: 121%

Banking Sector External Debt Roll-over Ratio**

Continuous access to

international funding sources

RESPONSIBLE

9 * Source: Latest data from the IMF-FSI database based on 2Q13 figures ** BRSA monthly data as of September 2013, commercial banks only

ECOSYSTEM AWARENESS

Well-Capitalized and Underleveraged

> Basel II CAR**: 15.1% (9M13)

> High ROAEs ** : ~15%

despite the low leverage

(9M13)

RESPONSIBLE

7.6x 7.6x 9.6x

11.8x

Turkey Russia Brazil South Africa

Leverage*

(2Q13)

14.0% 13.5%

12.3% 11.0%

Turkey South Africa Brazil Russia

Tier-I Ratio*

(2Q13)

ECOSYSTEM AWARENESS

Standing out for Its Asset Quality

10

Non-performing loans/Total gross loans*

* Source: Latest data from the IMF-FSI database, most of which are based on 2Q13 figures ** Source: Latest data from the IMF-FSI database. Represents country averages most of which are based on 2Q13 figures Note: NPL and Coverage Ratios are based on BRSA weekly data for commercial banks, as of September 27, 2013

NPL ratio**

> No exposure to any toxic assets or problematic sovereign assets > Established & prudent underwriting procedures

RESPONSIBLE

EU 27 10.1%

CEEMEA 10.4%

LATAM 2.80%

TURKEY 2.6%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

2006 2007 2008 2009 2010 2011 2012 1H13

0

5

10

1520

25

30

Turk

ey

Au

stri

a

Ne

the

rlan

ds

Bra

zil

UK

Bel

giu

m

Sou

th A

fric

a

Cze

ch R

ep.

Po

lan

d

Ru

ssia

Spai

n

Po

rtu

gal

Ital

y

Ukr

ain

e

Bu

lgar

ia

Slo

ven

ia

Hu

nga

ry

Ro

man

ia

Irel

and

Gre

ece

11

ECOSYSTEM AWARENESS

Strictly Monitored and Prudently Regulated Environment

Main pillars of regulatory environment

> Strictly regulated & supervised by risk Based & autonomous agency (BRSA) since 2000

> Independent Central Bank > policies targeting both financial and price stability

> Deposit Insurance scheme (SDIF)

> Separate authority to regulate listed companies (CMB)

> Authorities highly experienced in crisis management

Prudent regulatory actions

> Conservative provisioning policies

> Basel II implementation started in July 2012, Basel III implementation will start in January 2014

> Buffers for possible downturns

> Higher provisioning and capital requirement for unsecured consumer loans > Supportive regulatory actions on credit card asset quality > Active utilization of Reserve Requirement Ratio (RRR) and Reserve Option Coefficent (ROC) to manage liquidity

RESPONSIBLE

12

Savings / GDP (2007-2011 Average)

Source: IMF, World Economic Outlook Database, April 2013

ECOSYSTEM AWARENESS

How Authorities Address the Savings Challenge

> Incentives through private pensions Encourage more participants through direct government contributions

> Proliferation of gold deposits with effective use of RR tools Gold under-the -mattress will be revealed

> New severance scheme Severance payments will accumulate in a pooled fund, thus act like mandatory savings by government

> Withholding tax on deposits Lower rate for longer term deposits to encourage long term savings

RESPONSIBLE

22.9%

19.9% 21.1%

14.3%

CEEMEA EU27 LATAM Turkey

13

ECOSYSTEM AWARENESS

How We Address Challenges for Financial Health

RESPONSIBLE

Savings Test

Accumulating Gold Account

Spend & Save Account

Savings Account

for Future

Pension Funds

Mortgage

14

SHARING EXPERTISE FOR COMMON GOOD

Anatolian Meetings

Entrepreneur’s Handbook

Find Incentive

26,000 SME representatives, 87 meetings, 63 provinces

~ 8,500 applications

> 1st call center for mortgage > Team of 82 mortgage experts Women

Entrepreneur Executive

School

Women Entrepreneurs

Meetings

RESPONSIBLE

with 5,000 women

15

ACTIVE LISTENING & DEVELOPING ACCORDINGLY

RESPONSIBLE

Social Platforms

Customer Centricity

Index

Market Research

Investor Perception

Study

Employee Idea Platforms

To Sustain

High Quality & Corporate

Governance

16

79 cities ~3,500 schools ~84,500 teachers

More than 44,000 students since 2002 at ~70 centers

CREATING VALUE FOR SOCIETY THROUGH SOCIAL RESPONSIBILITY PROJECTS

12 GIANT MEN

Basketball Schools

A key cultural Institution for contemporary art in Turkey

More than 16 years of continuous support

RESPONSIBLE

EMPOWERING IN ALL POSSIBLE DIMENSIONS

18

SINGLE POINT OF CONTACT FOR ALL FINANCIAL NEEDS

EMPOWERING

Commercial

Payment Systems

Digital Banking

SME

Corporate

Consumer

EMPOWERING

19

OMNI-CHANNEL CONVENIENCE

Save Time for Customers Along with the Freedom It Offers

Internet Banking

Mobile Banking

Social Media

Call Center

ATMs

Omni Channel Strategy Providing seemless experience across

all channels

~2.6mn active users

~190 mn transactions/year

26% market share in financial transactions volume

• >180 type of transactions

• Serving non-bank customers

through cardless transactions

• Cash deposits/withdrawals: 101%

• >4 mn calls/month • Centralized branch calls

• Special offerings a first-of-its-kind application in Europe

• Money transfer

• Consumer loan application via secure full form

#1 in mobile banking >790k mobile banking users 36% market share in financial transactions volume

A new banking experience targeting socially active & connected customers

• Digital Wallet – credit, debit, identity and loyalty cards under one roof

• Location based offers based on check-ins from foursquare

• First in Europe: speech recognition, speech command

Reached 150K downloads and is now on Android

20

CULTURE OF PARTICIPATION & SHARING IN DECISION MAKING

Management Information

at all levels for performance monitoring

> Bank level

> Business line level

> Region level

> Branch level

> Sales person level

> Customer level

A single source of data & common understanding

> Single data dictionary

> Standardized management reports

> Consolidated data into MR platform

Platform for management and legal reporting

> Transparency

> Accountability

> Governance

EMPOWERING

Performance Management

Successful Decision Making

SUSTAINABLE FOR A BETTER LIFE

22

CARING FOR ENVIRONMENT Manage the Impact

EMPOWERING

Performance Management

> Applies Environmental and Social Loan Policies

to every loan without any monetary limit

> Applies Environmental and Social Impact Assessment System

to loans with an investment amount more than $20 million

> Environmental Policy and Environmental Management System

certified to ISO14001

23

EMPOWERING

Performance Management First Turkish bank to receive A level rating from GRI

with its Sustainability Report – 2013

Received “2012 Turkey - Carbon Performance Leadership” award

Joined United Nations Environment Programme – Finance Initiative

(UNEP-FI) in 2011

Signed up to UN Global Compact and became the first Turkish Bank

to join TBCSD* in 2012

CARING FOR ENVIRONMENT Being Transparent and Innovative

* Turkish Business Council for Sustainable Development

24

INNOVATIVE BUSINESS MODEL

SUSTAINABLE

Process Technology

People

Training hours per employee: 55hrs per annum

25

THE MOST VALUABLE ASSET: HUMAN CAPITAL

SUSTAINABLE

I International

quality standards

Performance Based

Incentive

> First Turkish company to receive the Investors in People (IIP) achievement certificate in 2005. > The first and only Gold IIP

certificate in Turkey in 2012

Measured by customer satisfaction, service quality, efficiency and profitability

vs.

Investing in people

Fortune 500 corporations

avg. of 35hrs

26

PIONEER WITH ITS TECHNOLOGY SUPPORTED OFFERINGS

SUSTAINABLE

IT Vision Investing in Technology

Full In-House Development

Custom-Fit Solutions

Driver (Integral Part of Management)

52 New Products in 9M13

27

SUSTAINABLE

PIONEER WITH ITS TECHNOLOGY SUPPORTED OFFERINGS

5-Minute Loan

FAST INNOVATIVE

A Total of 557 Products

Introducing Many Firsts

> 1st private bank to launch SME support package (1996)

> Started to offer «firsts» in cash management solutions (1997)

> 1st chip-based installment credit card loyalty program in Turkey - Bonus Card (2000)

> Turkey’s 1st cardless transactions via ATMs (2005)

> Cep-T paracard: Turkey’s 1st prepaid card

enabling SIM based secure service (2011)

> World’s 1st banking application for Windows 8 (2012)

> iGaranti: First-of-its-kind financial service leading the future of banking business and the revolution of conventional banking approach. (2013)

28

SUSTAINABLE

PIONEER WITH ITS TECHNOLOGY SUPPORTED OFFERINGS

> 1st bank in Turkey to create “paperless banking” operating environment and 1st bank in the world with ID scanning facilities in branches (2006). > Digital Banking: 81% of the transactions are carried out via digital channels.

Advanced CRM > Segmentation: Propensity Modelling > Personalized Product Offers

29

LESS IS MORE

SUSTAINABLE

> 1st Bank to set up centralized operations in Turkey > 99% Operational Centralization Ratio

> Electronic Data Warehousing > Highest per branch efficiencies in terms of assets, customer deposits, loans and ordinary banking income

Smarter Touch-Points for All

30

MANAGING WHAT WE MEASURE

SUSTAINABLE

WE KNOW...

What to Measure

Why to Measure

How to Measure

Risk-Return Balance

Customer Satisfaction

Key Performance Indicators

SUSTAINABLE

OUR JOURNEY TO SUCCESS

Asset (TL bn)

Performing Loans (TL bn)

Customer Deposits (TL bn)

Shareholders` Equity (TL bn)

Net Profit (TL mn)

Market Share

Rank*

Market Share

Rank*

Market Share

Rank *

2000 9M13 Growth CAGR

6.6%

#4

12.7%

#2

+6.1pps

8.5%

#5

12.7%

#2

+4.2pps

5.0%

#5

12.3%

#2

+7.3pps

6.6 189.8 29x 30%

2.5 112.5 45x 35%

3.4 103.9 34%

0.6 22.1 36x 32%

205 3,080** 15x** 25%**

COMFORTABLE LIQUIDITY

SOUND SOLVENCY LOW RISK

#1 IN MORTGAGES

HIGHEST DEMAND / TOTAL

DEPOSIT RATIO 20%

ROAE 2006 – 9M13 Avg.

> 20%

40x

Note: Figures are based on BRSA Bank-only financials for fair comparison * Ranks are among private banks. ** 2012 Bank only Net Income used in calculation for fair comparison.

READY FOR FUTURE