Turkiye Garanti Bankasi (GARAN) Q3 2025 earnings summary

Executive summary

• Net income for the first nine months of 2025 reached TL 84.5 billion, up 26% year-over-year, with Q3 net income at 30.9 billion TL and ROAE at 30.9%.

• Core banking revenues grew for the seventh consecutive quarter, driven by strong NII and fee generation, with digital customer engagement reaching 17.6 million.

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

• Asset growth was driven by customer activity, with performing loans up 39% year-to-date and customer deposits growing 38.7% to TL 2.91 trillion.

• Strategic focus included digitalization, customer-centric solutions, and sustainability, highlighted by becoming the first Turkish bank to sign the Equator Principles.

Financial highlights

• Net interest income including swap costs rose 96% year-over-year to TL 122.8bn, and net fees and commissions increased 54% to TL 104.4bn.

• Operating expenses increased 70% year-over-year, mainly due to digitalization and HR cost adjustments, but cost-to-income ratio remains lowest among peers.

• NPL ratio rose to 2.8% in Q3 2025, with total coverage at 63%.

• Capital adequacy ratio (CAR) was 16.3% (without regulatory forbearance), down from 18.2% at year-end 2024.

• Customer deposits now fund 69% of assets, with TL-heavy composition.

Outlook and guidance

• ROAE guidance maintained in the low-30% range, supported by better-than-expected net cost of risk and fee growth.

• Net cost of risk guidance improved to below 2% due to high provision reversals.

• NIM expansion guidance revised to 1.5%-2% amid higher policy rate expectations and TL deposit regulations.

• Fee coverage of OPEX expected to reach 90%-95%, with ROE likely near the lower bound of guided range.

• GDP growth forecast for Turkey maintained at 3.7%-4% for 2025, with inflation expectation revised up to 33% for year-end.