TF VARLIK KİRALAMA A.Ş.

TF Varlık Kiralama A.Ş. was established as a 100% affiliation of Türkiye Finans in February 2013 to intermediate in the Bank’s activities to find funds by issuing domestic and international lease certificates. The Company plans to promote the use of lease certificates and to inform investors of lease certificates as an investment instrument and the compliance of returns obtained from lease certificates with the principles of participation banking, in order to expand its investor base with the help of the Bank’s widespread branch network.

Interest in the issuance of lease certificate and companies that issue lease certificate is increasing every year. In 2017, the Undersecreteriat of the Treasury of the Republic of Turkey issued TL denominated lease certificates amounting to TL 4.3 billion. Accordingly, lease certificate issuance stock of Undersecreteriat of Treasury reached approximately TL 10.5 billion by the end of 2017. The Undersecreteriat of the Treasury issues CPI indexed lease certificates and gold backed lease certificates to diversify issued financing tools and to expand the investor base. The Undersecreteriat of the Treasury issued four Gold Backed Lease Certificates by collecting 1,319 kg of gold, and issued TL 550 million of CPI indexed lease certificates in 2017.

In 2017, the nine private sector leasing companies issued a total of 65 leasing certificates domestically, with a 130% YoY increase in the volume of the leasing certificates to TL7.9 billion.

As the asset leasing company with the largest volume of assets in Turkey, TF Varlık Kiralama A.Ş. issued 14 lease certificates in 2017 with a total issuance volume of approximately TL 1.3 billion.

The volume of certificates issued by TF Varlık Kiralama AŞ increased by 28% YoY to TL 1.3 billion in 2017. TF Varlık Kiralama A.Ş. conducted 70% of its issuances through public offering, and is the only asset lease company to do so.

In the issuance of lease certificates carried out in 2017, Türkiye Finans operated in the capacity of a fund user, while TF Varlık Kiralama A.Ş. was an issuer.

As a result of the strong demand for lease certificates and the issuances that we have carried out, the company rounded off a successful year.

The company continues to strengthen its position in the sector with its strong capital structure. In November 2017, the company’s priority unsecured borrowing instrument (Sukuk) issue rating was confirmed by the Fitch rating agency as BBB-.

We expect the company, which performed 16% of the domestic lease certificates issuances carried out in Turkey in 2017, to achieve a strong growth performance in line with the growth in the sector in 2018.

TFKB VARLIK KİRALAMA A.Ş.

TFKB Varlık Kiralama A.Ş was founded on 8 July 2014 as an affiliation with Türkiye Finans following the approval of the Banking Regulation and Supervision Authority and the Capital Markets Board, and the company was registered to the trade registry. TFKB Varlık Kiralama A.Ş was established with the purpose of realizing the issuance of the lease certificates in which those companies which are customers of the Bank take part as the resource establishment.

Working to a vision of providing long term interest-free financing to the private sector, TFKB Varlık Kiralama A.Ş. has extended a total of TL 314 million in resources to the real sector through lease certificate issuances since its establishment.

Our company carries out the issuances with a reference from Türkiye Finans Katılım Bankası that is the controlling shareholder of our company. Backed by its strong investor structure, our company plans to continue offering more successful issuances in 2018.