Our dear stakeholders,

Ziraat Participation sustained its rapid growth in accordance with its vision of being the leading participation finance institution of the industry and completed 2022 with a profit of TL 3.8 billion as a result of its growth performance focused on profitability and efficiency targets.

WE CONTINUE TO SUPPORT THE REAL SECTOR

Ziraat Participation meets its customers’ needs and expectations through the most appropriate channel by presenting the most appropriate solutions and value propositions and continues its activities with the vision of being an effective participation finance institution not only in its region but also in international markets.

Ziraat Participation continued its support for the real sector, primarily SMEs, in 2022. As of 2022 year-end, cash funds extended by Ziraat Participation increased by 119% to reach TL 145.7 billion while non-cash funds increased by 53% to reach TL 45.2 billion and the Bank’s total contribution to Turkish economy was realized as TL 191 billion.

As of 2022 year-end, funds collected increased by 122% when compared with prior year to reach TL 173 billion.

WE CARE ABOUT PROTECTING OUR ASSET QUALITY

Ziraat Participation adopted a growth strategy which prescribes protection and development of asset quality. The Bank’s allocation and fund extension processes as well as early warning and risk monitoring infrastructure are being developed accordingly.

Funds extended in 2022 sustained its rapid growth in line with sustainable growth and customer focus strategies. During this period, when risk management policies are executed uncompromisingly, non-performing loan ratio was realized as 1.3%, quite lower than the industry average. As of the same period, the Bank’s capital adequacy ratio was 15.42%.

Funds extended in 2022 sustained its rapid growth in line with sustainable growth and customer focus strategies.

LEASE CERTIFICATE ISSUANCES REACHED TL 53.2 BILLION

Ziraat Participation successfully completed 29 lease certificates at a total amount of TL 16.1 billion in 2022. As part of its strategy to enrich its resource structure, Ziraat Participation plays an active role in capital markets, Ziraat Participation, together with its subsidiaries Ziraat Katılım Varlık Kiralama A.Ş. and ZKB Varlık Kiralama A.Ş., obtained lease certificate issuance ceilings of TL 1 billion, TL 12 billion and TL 15 billion from Capital Market Board (SPK) to issue lease certificates in TL at domestic market.

The total of issuances since the establishment of Ziraat Participation until 2022 at different amounts reached TL 53.2 billion.

WE OFFERED “INSTANT FINANCING” PRODUCT TO OUR CUSTOMERS

With “Instant financing” product implemented in 2022, an opportunity was provided for our customers to finance their purchases from stores which have agreements with our Bank at any time of the day without going to the branch, through digital channels, easily and rapidly.

Our customers can complete their financing process by using the QR code of the shopping basket at the contracted store and applying for financing through our Bank’s mobile application in accordance with interest-free banking principles and standards by approving all necessary documents via digital channels.

WE LAUNCHED MY FIRST HOUSE AND HEAT INSULATION FINANCING

In order to provide our customers the opportunity to own a house at favorable financing terms, My First House Financing and Extended House Financing products were set up. Additionally, “Residential Heat Insulation Financing” product was implemented for individual customers to finance heat insulation and roof insulation spendings in favorable terms to increase efficiency of energy, used to heat their homes, to reduce costs and carbon emissions within the framework of sustainability.

WE EXTENDED OUR INSURANCE PRODUCT RANGE

Personal Accident Insurance, which guarantees bodily injury and death cases individuals may face as a result of sudden and unexpected events and offers additional beneficial services free of charge; Critical Illnesses Insurance, which contributes to payment of treatment expenses in cases of heart attack, cancer, stroke, blindness, kidney failure by paying the claim stated on the policy; Cyber Security Business Insurance, which includes cyber protection and does not make insufficient claim, were offered to our customers by taking their places in our Bank’s insurance product range.

INVESTMENT INCENTIVE PROTOCOL WAS SIGNED WITH KOSGEB

“Vegetables and Fruit Cold Chain Financial Leasing Support Program Protocol” and “KOSGEB Support Programs Financial Leasing Protocol” were signed within the scope of support programs between Small and Medium Enterprises Development Organization (KOSGEB) and Ziraat Participation to encourage investments for production with the objective of supporting a specific portion of the profit accrued in procurement of domestic goods and new cooling units and/or frigorific cases/units.

Support programs were signed between Small and Medium Enterprises Development Organization (KOSGEB) and Ziraat Participation with the purpose of encouraging production oriented investments.

SME FINANCIAL SUPPORT PROGRAM WITH EMPLOYMENT COMMITMENT WAS IMPLEMENTED

Within the scope of Strengthening Private Sector to Encourage Social and Economic Harmony in Turkey- FOSTER project, which is managed by the German Development Bank (“KfW”) and financed by EU, “SME Financial Support Program with Employment Commitment”(FOSTER) was implemented that allows businesses which are not banned from KOSGEB supports to obtain financing with favorable terms and which a part of the profit share is paid by KOSGEB. The project mainly aims to support SMEs who employ people who are officially Turkish Republic citizens and Syrian Under Temporary Protection residing in cities affected from migration or who employ refugees from other countries.

“INVESTMENT SUPPORT PACKAGE” WAS PREPARED

Protocols between Credit Guarantee Fund (KGF) and our Bank were signed and offered to users within the scope of support packages to reduce the impacts of pandemic conditions on businesses and to support investments.

In this context, KGF guaranteed “Investment Support Packages” were prepared to meet financing needs of all SMEs and non-SME businesses which need guarantee support for their financing needs in favorable conditions for new or continuing investments to increase their production and employment capacities (primarily for companies operating in manufacturing industry or exporting companies).

EXPORT AND WORKING CAPITAL SUPPORT PACKAGE WAS PREPARED

Within the framework of participation banking principles, KGF guaranteed “Export Support Packages” were prepared to meet working capital financing needs of SMEs which are exporters or operating in sectors bringing foreign currency and those who do not currently export but have potentials for exports. These financing needs were met with favorable conditions to support SMEs. For financing of working capital needs of SMEs and non-SME firms, “Working Capital Support Package” was prepared with the guarantee of Credit Guarantee Fund (KGF).

Within the framework of Treasury Supported Guarantee System, “Import Substitution Against Manufacturing Support Package” guaranteed by KGF was put in use.

IMPORT SUBSTITUTION AGAINST MANUFACTURING SUPPORT PACKAGE WAS PREPARED

Within the framework of Treasury Supported Guarantee System, “Import Substitution Against Manufacturing Support Package” guaranteed by KGF was put in use for businesses with investment incentive certificates obtained for manufacturing industry investments to finance investments that will increase production and employment capacities by reducing the negative effects of the pandemic on manufacturing industry.

TEA PRODUCERS WERE SUPPORTED BY TEA PURCHASE SUPPORT PACKAGE

“Tea Purchasing Support Package” was implemented and producers were supported to meet working capital needs of firms purchasing fresh tea from tea producers against producer receipts and companies purchasing fresh tea from Agricultural Credit Cooperatives.

CONSTRUCTION SERVICES FINANCING SUPPORT PACKAGE WAS PREPARED

“Construction Services Financing Support Package” was implemented between our bank and KGF to help SMEs and non-SME businesses operating in the construction sector to complete unfinished housing projects and to keep housing supply without interruption in favorable conditions. Financing was provided to companies with houses that are at least 30% complete and companies which have at least 20% unsold houses or houses not yet promised to sell as of the date of application with the purpose of completing the projects.

WE OFFERED FINDEKS SERVICE PLATFORM TO OUR CUSTOMERS

Our product “Findeks” was implemented in 2022 which provides opportunity for real sector to know each other in financial terms, to increase their skills to take and manage risks, to support them to protect their capital and reputations, to help them gain competitive power by increasing their sales safely and to help individuals manage their risks properly and take their financial lives under control.

OUR STUDIES FOR AGRICULTURAL FINANCING CONTINUE

“Agricultural Financing” product application studies continued in 2022 which aims to provide financial support in line with participation principles to be present at all locations Ziraat Participation is needed in agricultural sector to develop agriculture, increase mechanization and agricultural areas, to strengthen livestock farming, to minimize imports in agriculture and maximize exports and to make efficient production possible.

The Commercial Banking Department Directorate started its operations and in line with this, 14 commercial branches were opened in 9 cities.

AUTOMATIC PAYMENT IN FOREIGN CURRENCY TRANSFER TRANSACTIONS

System developments were completed which allows for payment of foreign currency incoming transfers to be deposited directly to the customer accounts. With this development, automatic payment of transactions which are paid manually to customer accounts due to IBAN-Name incompliance were made possible using smart machine learning which is used by the bank for the first time. Automatic credit recording of incoming transfers and their regulation controls started to be done automatically by the system.

WE OPENED 14 COMMERCIAL BRANCHES IN 9 CITIES

In 2022, commercial segment was formed within the scope of customer and branch segmentation activities with a customer-oriented approach with the purpose of providing services to customers through proper channels. The Commercial Banking Department Directorate started its operations and in line with this, 14 commercial branches were opened in 9 cities.

WE ACHIEVED MANY FIRSTS IN PRIVATE BANKING

With the efforts of our Private Banking department, we became the first and only bank to obtain potential tax identification number for foreign customers without coming to Turkey which in the normal course can be obtained from the interactive tax office after coming to Turkey. With this completed project, real person customers who reside in foreign countries are provided the opportunity to deposit their foreign currency savings in USD, EUR, GBP and CHF and to complete their transactions rapidly as Private Banking customers.

For the Concierge and Assistance services that will be provided to Private Banking customers in addition to financial services, agreements with related companies were signed. Advisory services started to be offered to customers such as Legal and Financial Consultancy, Real Estate and Property Investments, Education Abroad, Private Jet Leasing, Internal Architecture, Design and Decoration, Dental Health and Aesthetics.

TAV Passport Cards and IGA Pass Extra Cards were given as gifts to all private banking customers with Ziraat Participation privileges. With those cards, numerous privileges were provided to customers at contracted airports, such as free parking, privileged flight transactions, free lounge access and discounted shopping at numerous points.

SIGNIFICANT INNOVATIONS IN DIGITAL BANKING

Customers have the opportunity to give approval to many transactions and documents with “Digital Document Approval” option such as account opening, credit card, individual financing and insurance documents through Participation Mobile application. Similarly, after customers’ application to TKBB on behalf of Ziraat Participation, the whole process between TKBB and the Bank can be digitally monitored and governed end-to-end.

Studies related to cash withdrawal and deposit at all TAM (Turkey’s ATM Center) ATMs by scanning QR Code from Participation Mobile application, cash withdrawal from ATMs of other banks and payments at POS devices were completed and offered to customers’ use.

IN 2022, WE ENRICHED OUR HUMAN RESOURCES WITH NEW ADDITIONS

Ziraat Participation continued to develop its human resources, its most valuable asset, with new additions in 2022.

Within our ever-growing organization structure, 448 new colleagues joined us based on the need of our branches and Headquarter units. Number of employees reached 1,904 as of 2022 year-end. During the year, 35 new branches were added to our branch network and total number of branches reached 156.

As we carry on our projects devotedly, keeping our loyalty to our mission of expanding participation banking, our ultimate target is to create increasing value to Turkish economy and support sustainable development in multiple ways.

MANY THANKS TO ALL WHO CONTRIBUTED TO OUR SUCCESS IN 2022

We continue to work with devotion to increase our contribution to real economy with our values and ethical principles which reflect our long-standing corporate culture.

As we carry on our projects devotedly, keeping our loyalty to our mission of expanding participation banking, our ultimate target is to create increasing value to Turkish economy and support sustainable development in multiple ways.

On behalf of Ziraat Participation management team, I would like to extend my gratitude to all our stakeholders, our employees in particular, who walk with us determinately on our journey to reach higher targets and contributed to our successful performance.

Respectfully