Türkiye Is Bankasi (ISCTR) Q1 2025 earnings summary

Executive summary

• Annual inflation declined in Q1 2025, with CBRT maintaining a tight monetary policy and making proactive rate adjustments in response to market volatility.

• Achieved strong profitability and efficiency improvements in Q1 2025, with significant growth in net interest income and fee income year-over-year.

• Asset size reached TL 3.68 trillion, up 10.6% from year-end 2024, maintaining the position as Türkiye's largest private bank.

• Maintained robust asset and liability growth, with total assets up 37.9% and deposits up 39.6% year-over-year.

• Demonstrated resilient asset quality, with the lowest NPL ratio among peers and strong collection performance.

Financial highlights

• Net interest income rose 10.7% year-over-year to TL 17.7 bn; net fees and commissions up 39.2% to TL 27.0 bn.

• Operating profit increased 44.0% year-over-year to TL 15.1 bn.

• OpEx declined 5% quarter-on-quarter and rose 24% year-over-year, outperforming peers and inflation.

• Return on tangible equity exceeded 18% in Q1; ROAA and ROAE at 1.4% and 18.1%, respectively.

• TL deposits grew 13% and FX deposits 9% quarter-on-quarter; demand deposits made up 42% of total deposits.

Outlook and guidance

• Guidance remains unchanged; Q1 results are in line with budget estimates and year-end 2025 expectations.

• TL loan growth expected at ~35% for 2025; net interest margin to expand by 450 bps.

• Net fees and commissions growth projected at ~50% year-over-year; OPEX growth to track average CPI.

• NPL ratio expected around 3%; net cost of risk ~200 bps; capital adequacy ratio to remain above 15%.

• Return on average equity guidance at ~30%, dependent on NII trajectory.