For the global economy, 2016 was a year beset with a very heavy agenda among the most critical items of which were presidential elections in the United States, the US Federal Reserve Bank’s funding rate decisions, debates about “Brexit”–Britain’s decision to leave the European Union, and depressed oil prices.
Towards the end of the year the Fed had recourse to a federal funding rate hike while also revising its projections for 2017. Expectations of the possibility of an even greater increase in this rate in 2017 weakened the flow of funds heading to the world’s developing-country markets. Besides, US presidential election and the uncertainties which arose from the possibility of there being changes in monetary policy depending on the election’s outcome is another factor for emerging markets.
For the European economy, 2016 was under the moderate growth conditions. Although UK’s decision through referendum to withdraw from the European Union led the markets into short-term confusion and uncertainty, the European economy continued to grow for the rest of the year in line with forecasts.
Having dropped to as low as USD 27 a barrel in early 2016, oil prices surpassed USD 55 by the end of the year, due to OPEC member countries’ decision to cut production for the first time in eight years.
Global trade in 2016 expects to grow at slowest pace since the financial crisis of 2009. This slowdown, which was experienced especially among the world’s emerging economies, depressed demand and consequently prices, particularly in the case of basic commodities.
Even in the face of multidimensional risks, Turkey once again maintained its strong stance in 2016.
The Turkish banking industry in 2016 spent the year taking proactive measures aimed at preventing volatilities arising from global conditions from having an impact on the national economy. Indeed our industry was one of the economy’s most resolute supporters. Participation banking for its part continued to grow and develop by responding to the needs of the real economy. By most financial measures, our sector registered performances that surpassed those of previous years.
Türkiye Finans is strong and ready for the future.
Distinguishing itself by virtue of its ability and strength to adapt its long-term profitable growth strategy to whatever market conditions may currently prevail, our Bank made every possible effort to maximize its financial performance and once again successfully did so in 2016.
As a result our Bank closed the year showing a profit amounting to TL 296 million, which was 13% higher than 2015.
Türkiye Finans’ equity at year-end 2016 amounted to TL 3.7 billion, 9% more than in 2015, while its return on equity reached 8.4% level. Notwithstanding changes in capital-related regulations introduced in 2016, our bank expanded its capital base and boosted its capital adequacy ratio to 15.6%.
The decisive steps that we took and the efforts made with a visionary outlook in 2016 enabled us to initiate a process that will make it possible for our management team, our employees, and our organizational units to prepare themselves to face the future on every front. Let me also add that important progress in this direction has already been made.
In the final analysis, these measures will not only strengthen TFKB in the short, medium, and long terms but also will make it even greater contributor to the Turkish economy and will create increasingly more value for all of its stakeholders.
In closing therefore and speaking both personally and on behalf of the Türkiye Finans Board of Directors, I thank all of our stakeholders who contributed to our performance while also offering my respects to you all.
Saeed Mohammed A ALGHAMDI
Chairman of the Board of Directors