Summary Report of the Board of Directors for 2021

Türk Eximbank continued to support Turkish exporters with credit and credit insurance facilities in 2021. In the reporting period, the Bank’s total support amounted to USD 46.1 billion. The Bank extended loans worth USD 22.5 billion, of which USD 4.6 billion is medium- and long-term credits. On the other hand, the Bank’s credit insurance/reinsurance support amounted to USD 23.6 billion.

As of year-end 2021, Türk Eximbank’s paid-in capital was raised from TL 9.27 billion to TL 10.8 billion, which was covered by cash capital transfer of TL 100 million from the Treasury and by offsetting profit reserves in the amount of TL 1.43 billion.

Currently serving through 22 branches and 10 liaison offices, the Bank’s active credit customers reached 10,935. The number of active insured exporters, on the other hand, reached 5,484. Hence, the total number of customers increased by 8% to 14,092; of these firms, 77% are SMEs.

An overview of 2021 activities…

2021 has been a year dominated by the pandemic and was characterized by the toils to minimize its impacts. Türk Eximbank continued to lend support to our exporters at a growing extent. In 2021 during which Türkiye’s exports broke record, there was a significant rise particularly in insured shipments volume on an annual basis. The fluctuations in CBRT-sourced credits were striven to be compensated with credits funded by Türk Eximbank and by credits secured from international fund institutions.

High demand for Rediscount Credits originating from CBRT, which is an important source of finance for exporters, continued in 2021. Rediscount credits disbursed under the Pre-Shipment and Post-Shipment Rediscount Credit programs amounted to USD 16.2 billion, which accounted for 73% of the Bank’s total loan volume. The balance of the said fund reached USD 12.7 billion as of 31 December 2021.

The loans disbursed under International Loans Programs in 2021 amounted to USD 36.4 million, and 34 letters of intent were issued in favor of Turkish companies for projects/export deals to be carried out in 18 countries with goods and services export potential worth USD 7.9 billion. Within the scope of the Ministry of Trade’s Commercial Interest Reference Rate (CIRR) support for trade finance transactions, the Bank continued to provide competitive financing options at CIRR to buyers of our exporters with the aim of promoting the exports of high value-added investment goods from our country. Within the scope of CIRR Interest Support, a total of loans worth USD 8.4 million was extended in 2021.

During the reporting period, shipments worth USD 23.5 billion were covered under receivable insurance, with short-term export credit insurance representing 90% of it. While premiums collected totaled USD 73.6 million for the business volume worth USD 23.6 billion including reinsurance support, claims paid amounted to USD 30 million.

Developments in Existing Products Aligned with Exporters’ Needs…

Besides increasing the supports in 2021, developments and updates were undertaken to offer better solutions to our exporters’ demands with our existing products.

Obtaining Funds for Low-Cost Financing Available in Various Terms to our Exporters…

In 2021, Türk Eximbank secured funds in the amount of USD 3.3 billion from international markets and an additional USD 2.3 billion within the scope of funding from treasury transactions (repurchase agreements, TRS, currency swaps, borrowings) and kept offering low-cost financing facilities with various maturities from its fund stock maintained at USD 9.9 billion level, excluding CBRT funds. The Bank’s total fund stock including TL credits and including the CBRT rediscount facility of USD 12.7 billion was registered in the order of USD 22.6 billion.

Processes Accelerated and Facilitated through Digitalization…

As Türk Eximbank simplified and accelerated its processes with a digital focus, it gave exporters easier access to the Bank’s products and services. Steps were taken that enhanced service quality, and the number of documents required for filing applications was decreased as the application processing durations were shortened.

In this framework, credit and insurance internet banking platforms were merged and our mobile application was put into use in 2021. As part of these initiatives, our exporters were provided the opportunity to file applications for credit and insurance products, in addition to information and document viewing function which was already available.

Important Moves, Strong Bonds in International Partnerships…

Türk Eximbank attaches special importance to establishing new partnerships and to strengthening the existing bonds of cooperation in order to maximize the support it lends and to help increase the competitiveness of Turkish exporters and contractors in the international arena.

By the same token, reinsurance agreements were signed with OeKB (Austria), MEHIB (Hungary) and EKN (Sweden) in addition to the ones signed in previous years with the official credit export agencies of the USA, United Kingdom, France and Denmark for financing the projects that will be jointly carried out by Turkish firms and the firms of the said countries’ companies in third countries.

Efforts were carried on for signing memoranda of understanding (MoU) that will take our existing relations with our foreign counterparts further and pave the way for comprehensive and quality collaborations. In 2021, memoranda of understanding were signed for general cooperation with Uzbekinvest, the official export credit agency in Uzbekistan, PJSC ECA, the official export credit agency in Ukraine, and Africa Finance Corporation, a multilateral institution supporting infrastructure investments in Africa. The MoU signed with Japan’s official export credit agency JBIC in 2018, which expired, was extended, and the expired MoU with the African Trade Insurance Agency was renewed with a broadened scope.

We Added Pace to our Sustainability Activities…

ISO 14064:2006 Greenhouse Gas Accounting audit related to our operational impact in 2020 was successfully completed within the scope of Sustainability Activities.

ISO 14064 certification, which will serve as an important endorsement of our Bank’s capability in relation to sustainability in various aspects including the Sustainability Report, sustainability-linked syndicated loans, alternative sustainable financing sources and funding, has been obtained from Bureau Veritas, an international certification agency.

With this certification, Türk Eximbank;

Explanations about Türk Eximbank’s Balance Sheet and Profit & Loss Statement

Türk Eximbank’s balance sheet size reached TL 322.4 billion (USD 24.4 billion) as at 31 December 2021.

Türk Eximbank’s assets are composed of credits by 89%, liquid assets by 7%, and marketable securities measured at amortized cost and other assets by 4%.

The Bank’s loan portfolio reached TL 288.1 billion, up by 61% in the twelve months to end-December 2021. Of the total credits, 62% (TL 179.5 billion) are short-term credits and 38% (TL 108.6 billion) are medium- and long-term credits. Through effective risk assessment methods pursued, Türk Eximbank works arduously to timely and fully collect its credits. As a result, although a substantial portion of the Bank’s funds are channeled to the exports industry in the form of credits, the ratio of non-performing loans (NPL) to total loans is well below the sector’s average and stands at 0.2%.

Türk Eximbank’s total liabilities were worth TL 322.4 billion. Of these, 4.5% (TL 14.6 billion) consisted of shareholders’ equity, 93% (TL 300 billion) of external funds, and 2.5% (TL 7.8 billion) of provisions and other liabilities.

Out of the Bank’s shareholders’ equity of TL 14.6 billion, 74% (TL 10.8 billion) pertains to paid-in capital, 4% (TL 573.7 million) to profit reserves and others, and 22% (TL 3.1 billion) to net profit for the period.

TL 299.6 billion of foreign resources used for funding the Bank’s assets consisted of TL 167.5 billion in credits sourced by the CBRT, TL 82.8 billion in credits provided from domestic and foreign banks, TL 37.3 billion in marketable securities issued, TL 5.5 billion in subordinated loans, and TL 6.5 billion in borrowings from money markets.

At its Extraordinary General Assembly convened on 26 March 2017, Türk Eximbank switched to the registered capital system and authorized capital practice. At the Ordinary General Assembly convened on 26 March 2021, the authorized capital was increased to TL 17.5 billion. The Bank’s paid-in capital is currently TL 10.8 billion.

Although special and general provisioning ratio for the Bank for transactions within the scope of the Law governing its establishment is set at zero percent pursuant to “Article 21 - Exemptions” of the “Regulation on Procedures and Principles for Classification of Loans and Provisions to be Set Aside by Banks”, Türk Eximbank sets aside provisions within the frame of Turkish Financial Reporting Standards 9.

The ratio of Türk Eximbank’s liquid assets including short term loans to short-term liabilities was registered as 99.2% as of 31 December 2021.

The credit-weighted composition of Türk Eximbank’s balance sheet bears effects also on income. The Bank's total interest income is 7.2 billion TL, of which 83.5% is interest received from loans. On the other hand, the Bank’s interest expense was TL 4.4 billion since the Bank secures funds by way of borrowing from domestic and international money and capital markets and through bond issuances. Of this amount, 50.4% (TL 2.2 billion) was interest paid on borrowings from domestic and international markets, 47.3% (TL 2.1 billion) was interest paid on marketable securities issued and 2.3% (TL 99 million) was other interest expenses. Hence, net interest income was TL 2.8 billion.

The Bank booked a net profit of TL 3.1 billion as of 31 December 2021. Therefore, the Bank registered return on assets and return on equity ratios of 1.18% and 29.11%, respectively, and a capital adequacy ratio of 18.02%.

The Bank carries out its operations in accordance with the legislation governing it and the provisions of its Articles of Association, and we hereby present our summary report pertaining for the period ended 31 December 2021 for your review.

 

 

 

Murat ZAMAN

Chairman

 

 

 

 

 

 

 

 

 

 

 

Rıza Tuna TURAGAY

Deputy Chairman

 

 

 

Ali GÜNEY

Member

 

 

 

 Nail OLPAK

Member

 

 

 

 

 

 

 

 

 

İsmail GÜLLE

Member

 

 

 

Fahriye Alev ARKAN

Member

 

 

 

Duygu GÜVEN

Member
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