Akbank (AKBNK) Q3 2024 earnings summary

Executive summary

• Net income for 9M24 was TL 33.1 bn, down 36% year-over-year, with core revenue up 17% YoY driven by strong fee income growth offsetting NII decline.

• ROE stood at 20.2% and ROA at 2.0% for 9M24, reflecting sector-wide profitability pressures.

• Active customer base grew 69% since 2021, surpassing 14 million, with digital penetration reaching 86%.

• Strategic focus on digitalization, sustainable finance, and prudent risk management underpinned performance.

• Operating in a challenging Turkish macroeconomic environment, with fiscal discipline and structural reforms providing cautious optimism for stability and growth around 3% this year.

Financial highlights

• Net income for 2024 was TL 42,362 mn, down 36% year-over-year; core revenue rose 17% YoY to TL 85.3 bn.

• Fees and commissions rose 116% year-over-year to TL 73,718 mn; fee and commission income grew 136% YoY, with fee-to-OpEx ratio reaching 84%.

• Net interest income (NII) for 2024 was TL 70,088 mn, up 2% year-over-year.

• Operating expenses increased 80% year-over-year to TL 85,477 mn; cost/income ratio rose to 56.7%.

• Total assets reached TL 2.4 tn, with loans at TL 1.25 tn and deposits at TL 1.58 tn as of 9M24.

Outlook and guidance

• TL loan growth expected at ~40% for 2024; FX loan growth (USD) projected above 20%.

• Net fees and commissions growth to exceed 100% for 2024; NIM guidance at ~3% with downside risk.

• Opex growth guided at ~70% for the year; NPL ratio expected around 2% with some downside risk.

• ROE targeted at mid to high 20% range, though downside risk remains.

• Expecting gradual NIM recovery in Q4 and into 2025, contingent on rate cuts and macroprudential policy changes.