Turkiye Garanti Bankasi (GARAN) Q3 2024 earnings summary

Executive summary

• Net income for the first nine months of 2024 reached TL 67 billion, up 16% year-over-year, with ROAE at 33% and ROAA at 3.5%.

• Core banking revenues rose 27% year-over-year, with strong fee growth and robust digital customer penetration.

• Maintained leadership in TL lending, credit cards, and consumer loans, with market share gains across key segments.

• Capital position remains strong, with CAR at 15.8% and CET1 at 13.4%.

• Navigated regulatory pressures and market complexities, sustaining improvement in core banking revenues.

Financial highlights

• Net income for 9M24 was TL 67 billion, up 16.3% year-over-year; net fees and commissions grew 155.6% to TL 67.98 billion.

• Net interest income rose 49% year-over-year to TL 89.56 billion; core NII increased 55% year-over-year.

• Cost/income ratio at 43%, indicating highest efficiency among peers; opex/avg. assets at 3.8%.

• NPL ratio at 2.1%, with total provisions on balance sheet at TL 61.3 billion.

• Loans/deposits ratio at 78%, liquidity coverage ratio at 187%, and leverage at 8.5x.

Outlook and guidance

• Full-year ROAE guidance maintained in the mid-30s, with NIM facing downside risk from regulation.

• Loan growth for 2025 projected at 35%-40%, close to or above inflation.

• Fee and opex growth to exceed average CPI; net cost of risk (excl. currency) guided at 90bps.

• 2025 cost of risk expected to rise to 200-250 basis points, mainly from consumer loans.

• Focus remains on digitalization, customer-centric growth, and sustainability, with ongoing investments in technology and advisory services for energy transition.