(Convenience Translation of Financial Statements and Related Disclosures and Footnotes
Originally Issued in Turkish)
Türkiye Garanti Bankası Anonim Şirketi
Publicly Announced Unconsolidated Financial
Statements, Related Disclosures and Independent
Auditors' Report Thereon
as of and for the Six-Month Period Ended
30 June 2022
(Convenience Translation of Financial Statements and Related
Disclosures and Footnotes Originally Issued in Turkish)
Güney Bağımsız Denetim ve SMMM A.Ş. | Tel: +90 212 315 3000 |
Maslak Mah. Eski Büyükdere Cad. | Fax: +90 212 230 8291 |
Orjin Maslak İş Merkezi No: 27 | ey.com |
Daire: 57 34485 Sarıyer | Ticaret Sicil No : 479920 |
İstanbul - Türkiye | Mersis No: 0-4350-3032-6000017 |
Convenience Translation of the Auditor's Limited Review Report
Originally Issued in Turkish (See Note I in Section Three)
Independent Auditors' Report on Review of Unconsolidated Interim Financial Information
To the Board of Directors of Türkiye Garanti Bankası Anonim Şirketi;
Introduction
We have reviewed the unconsolidated statement of financial position of Türkiye Garanti Bankası A.Ş. ("the Bank") at June 30, 2022 and the related unconsolidated statement of profit or loss, unconsolidated statement of profit or loss and other comprehensive income, unconsolidated statement of changes in shareholders' equity, unconsolidated statement of cash flows and a summary of significant accounting policies and other explanatory notes to the unconsolidated financial statements for the six month period then ended. The Bank Management is responsible for the preparation and fair presentation of interim financial statements in accordance with the "Regulation on Accounting Applications for Banks and Safeguarding of Documents" published in the Official Gazette no.26333 dated November 1, 2006, and other regulations on accounting records of Banks published by Banking Regulation and Supervision Agency ("BRSA") and circulars and interpretations published by Banking Regulation and Supervision Authority ("BRSA") and Turkish Accounting Standard ("TAS") 34 "Interim Financial Reporting" for those matters not regulated by BRSA Legislation (together referred as "BRSA Accounting and Financial Reporting Legislation"). Our responsibility is to express a conclusion on these interim financial statements based on our review.
Scope of Review
We conducted our review in accordance with the Standard on Review Engagements (SRE) 2410, "Limited Review of Interim Financial Information Performed by the Independent Auditor of the Entity". A review of interim financial information consists of making inquiries, primarily of persons responsible for financial reporting process, and applying analytical and other review procedures. A review of interim financial information is substantially less in scope than an independent audit performed in accordance with the Independent Auditing Standards and the objective of which is to express an opinion on the financial statements. Consequently, a review of the interim financial information does not provide assurance that the audit firm will be aware of all significant matters which would have been identified in an audit. Accordingly, we do not express an opinion.
Basis of Qualified Conclusion
As explained in Section Five Part II.8.4, the accompanying unconsolidated financial statements as at June 30, 2022 include a free provision at an amount of TL 7,500,000 thousands which was provided in prior years by the Bank management for the possible effects of the negative circumstances which may arise from the possible changes in the economy and market conditions which does not meet the recognition criteria of TAS 37 "Provisions, Contingent Liabilities and Contingent Assets".
A member firm of Ernst & Young Global Limited
Qualified Conclusion
Based on our review, except for the effect of the matter referred in the basis of qualified conclusion paragraph on the unconsolidated financial statements, nothing has come to our attention that causes us to believe that the accompanying unconsolidated financial statements do not give a true view of the financial position of Türkiye Garanti Bankası A.Ş. at June 30, 2022 and of the results of its operations and its cash flows for the six month period then ended in all aspects in accordance with the BRSA Accounting and Financial Reporting Legislation.
Other matter
The unconsolidated financial statements of the Bank as at December 31, 2021 and June 30, 2021 which were prepared in accordance with "BRSA Accounting Financial Reporting Legislation" were audited and reviewed by another audit firm respectively. Audit firm expressed a qualified opinion in their reports issued on February 2, 2022 since the unconsolidated financial statements which included in their reports include a free provision at an amount of TL 7,500,000 thousand out of which TL 4,650,000 thousand was provided in prior years and TL 2,850,000 thousand provided in 2021 by the Bank management as of December 31, 2021. Also Audit firm expressed a qualified conclusion in their reports issued on July 29, 2021 due to the free provision at an amount of TL 5,600,000 thousand of which TL 4,650,000 thousand provided in the prior years and TL 950,000 thousand provided in 2021 as of June 30, 2021 for the possible effects of the negative circumstances which may arise from the possible changes in the economy and market conditions.
Report on other regulatory requirements arising from legislation
Based on our review, nothing has come to our attention that causes us to believe that the financial information provided in the accompanying interim activity report in Section VII, are not consistent with the unconsolidated financial statements and disclosures in all material respects.
Additional paragraph for convenience translation to English
As explained in detail in Note I of Section Three, there are differences between accounting principles and standards set out by regulations in conformity with BRSA Accounting and Financial Reporting Legislation and the accounting principles generally accepted in countries, in which the accompanying unconsolidated financial statements are to be distributed and International Financial Reporting Standards ("IFRS"), including non application of IAS 29 Financial Reporting in Hyperinflation Economies. The effect of such differences has not been quantified in the accompanying unconsolidated financial statements. Accordingly, the accompanying unconsolidated financial statements are not intended to present the financial position, results of operations and changes in financial position and cash flows in accordance with the accounting principles generally accepted in such countries and IFRS.
Güney Bağımsız Denetim ve Serbest Muhasebeci Mali Müşavirlik Anonim Şirketi A member firm of Ernst & Young Global Limited
Damla Harman, SMMM
Partner
July 28, 2022 İstanbul, Türkiye
(2)
A member firm of Ernst & Young Global Limited
(Convenience Translation of Financial Statements and Related Disclosures and Footnotes
Originally Issued in Turkish)
TÜRKİYE GARANTİ BANKASI ANONİM ŞİRKETİ
UNCONSOLIDATED FINANCIAL REPORT AS OF AND
FOR THE SIX-MONTH PERIOD ENDED 30 JUNE 2022
Levent Nispetiye Mah.Aytar Cad.
No:2 Beşiktaş 34340 Istanbul
Telephone: 212 318 18 18
Fax: 212 216 64 22
www.garantibbva.com.tr
investorrelations@garantibbva.com.tr
The unconsolidated financial report for the six-month period ended prepared in accordance with the Communiqué of Financial Statements and Related Disclosures and Footnotes to be Announced to Public by Banks as regulated by Banking Regulation and Supervision Agency, is comprised of the following sections:
- General Information about the Bank
- Unconsolidated Financial Statements of the Bank
- Disclosures Related to Accounting Policies Applied in the Related Period
- Financial Position and Risk Management Applications of the Bank
- Disclosures and Footnotes on Unconsolidated Financial Statements
- Limited Review Report
- Interim Activity Report
The unconsolidated financial statements and related disclosures and footnotes that were subject to independent audit, are prepared in accordance with the Regulation on Accounting Applications for Banks and Safeguarding of Documents, Turkish Accounting Standards, Turkish Financial Reporting Standards and the related statements and guidances, and in compliance with the financial records of our Bank and, unless stated otherwise, presented in thousands of Turkish Lira (TL).
Süleyman Sözen | Recep Baştuğ | Aydın Güler | Hakan Özdemir |
Board of Directors | General Manager | Executive Vice President | Financial Reporting and |
Chairman | Responsible of Financial | Accounting Director | |
Reporting |
Jorge Saenz - Azcunaga | Avni Aydın Düren | Belkıs Sema Yurdum |
Carranza | ||
Audit Committee Member | Audit Committee Member | Audit Committee Member |
The authorized contact person for questions on this financial report:
Name-Surname/Title: Handan SAYGIN/Director of Investor Relations
Phone no: 90 212 318 23 50
Fax no: 90 212 216 59 02
SECTION ONE | Page No: | |
General Information | ||
I. | History of the Bank including its incorporation date, initial legal status, amendments to legal status | 1 |
- Bank's shareholder structure, management and internal audit, direct and indirect shareholders, change
in shareholder structure during the period and information on bank's risk group | 1 |
- Information on the Bank's Board of Directors Chairman and members, Audit Committee members, Chief Executive Officer,
Executive Vice Presidents and their responsibilities and shareholdings in the Bank | 3 | |
IV. | Information on the Bank's qualified shareholders | 4 |
V. | Summary information on the bank's activities and services | 4 |
VI. | Current or likely actual or legal barriers to immediate transfer of equity or repayment of debts between the Bank and its subsidiaries | 4 |
SECTION TWO | ||
Unconsolidated Interim Financial Statements | ||
I. | Balance sheet - Assets | 5 |
II. | Balance sheet - Liabilities | 6 |
III. | Off-balance sheet items | 7 |
IV. | Statement of profit or loss | 8 |
V. | Statement of profit or loss and other comprehensive income | 9 |
VI. | Statement of changes in shareholders' equity | 10 |
VII. | Statement of cash flows | 11 |
SECTION THREE | ||
Accounting Policies | ||
I. | Basis of presentation | 12 |
II. | Strategy for use of financial instruments and foreign currency transactions | 13 |
III. | Investments in associates and subsidiaries | 14 |
IV. | Forwards, options and other derivative transactions | 14 |
V. | Interest income and expenses | 16 |
VI. | Fees and commissions | 16 |
VII. | Financial instruments | 17 |
VIII. | Disclosures on impairment of financial instruments | 20 |
IX. | Netting and derecognition of financial instruments | 25 |
X. | Repurchase and resale agreements and securities lending | 27 |
XI. | Assets held for sale, discontinued operations and related liabilities | 27 |
XII. | Goodwill and other intangible assets | 28 |
XIII. | Tangible assets | 28 |
XIV. | Leasing activities | 30 |
XV. | Provisions and contingent liabilities | 30 |
XVI. | Contingent assets | 30 |
XVII. | Liabilities for employee benefits | 30 |
XVIII. | Taxation | 32 |
XIX. | Funds borrowed | 34 |
XX. | Share issuances | 35 |
XXI. | Confirmed bills of exchange and acceptances | 35 |
XXII. | Government incentives | 35 |
XXIII. | Segment reporting | 35 |
XXIV. | Profit reserves and profit appropriation | 37 |
XXV. | Earnings per share | 37 |
XXVI. | Related parties | 37 |
XXVII. Cash and cash equivalents | 37 | |
XXVIII. Other disclosures | 38 | |
SECTION FOUR | ||
Financial Position and Results of Operations and Risk Management | ||
I. | Total capital | 40 |
II. | Credit risk | 48 |
III. | Currency risk | 48 |
IV. | Interest rate risk | 50 |
V. | Position risk of equity securities | 53 |
VI. | Liquidity risk management and liquidity coverage ratio | 54 |
VII. | Leverage ratio | 61 |
VIII. | Fair values of financial assets and liabilities | 62 |
IX. | Transactions carried out on behalf of customers and items held in trust | 62 |
X. | Risk management objectives and policies | 62 |
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Turkiye Garanti Bankasi AS published this content on 29 July 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 29 July 2022 14:01:35 UTC.