Table of Contents
Executive summary ........................................................................... 3
Outlook ....................................................................................................................................3
Valuation ..................................................................................................................................3
Risk analysis and forthcoming catalysts....................................................................................4
Fine-tuning our earnings estimates ................................................. 5
Revisions to our forecasts and price targets.............................................................................5
Valuation: an impressive come-back ............................................... 6
Dramatic re-rating of Turkish banks...........................................................................................6
The same but different...................................................................... 8
Another strong quarter for Turkish banks..................................................................................8
Glance at 2Q09 performance....................................................................................................8
2Q09 review..................................................................................... 12
Akbank: better 2Q09 profitability on higher fee growth, lower opex ......................................12
2Q09 previews ................................................................................. 13
Garanti Bank: ROAE to stay at 28%........................................................................................13
Halkbank: Asset quality deterioration softer than sector trends..............................................14
Isbank: Net profit to decline 14% q-o-q, in the absence of dividend income..........................15
Vakifbank: Net profit to rise sharply 6% q-o-q.........................................................................16
Yapi Kredi: high increase in NPLs due to credit card dependency ..........................................17
Revised estimates and valuation ................................................... 18
Valuation ................................................................................................................................18
Summary of revisions .............................................................................................................18
Risks and forthcoming catalysts .............................................................................................22
Comparative multiples.................................................................... 23
Valuation, sensitivity tables and risks ........................................... 25
Akbank – Sell...........................................................................................................................25
Garanti – Buy...........................................................................................................................26
Halkbank – Buy........................................................................................................................27
Isbank – Hold ..........................................................................................................................28
Vakifbank – Hold .....................................................................................................................30
Yapi Kredi – Hold .....................................................................................................................31
Summary financials......................................................................... 32