Best bank: Isbank
The 100th anniversary of Isbank, Turkey’s biggest private-sector lender, has come after some challenging years for the country’s economy and financial sector.
The bank has been doing well despite the challenging environment, evident in a cost-to-income ratio of 38.2%. Already Turkey’s largest private-sector deposit-taker, it is aiming to grow loans and fees faster than peers, as chief executive Hakan Aran sees a chance for private-sector lenders to regain share from public-sector banks. Its asset quality also appears as good as ever. The bank ended 2023 with a non-performing loan ratio of just 2.1%.
While managing the present, Isbank has also been focusing on the future. One aspect of that is its move towards a holding-company model and to restructure its subsidiaries, which already include 10 listed companies, the largest of which is multinational glass manufacturer Sisecam, and the newest of which is Enerji, a renewable energy company. It is a move that has been well-received in the stock market.
In the front office, meanwhile, the bank has continued to develop its offering. That includes mobile platform IsCep, which it considers a peer to apps like China’s WeChat in terms of ability to combine banking with social media. Among the services available are a digital letter of guarantee and PaybyLink, allowing merchants to receive payments by sending a hyperlink to customers via SMS, email, or other messaging platforms.
The bank is also transforming its branch network, including establishing offices for certain subsets including agriculture, tourism and startups.
Increasingly, however, Aran – a software specialist, rather than just a banker – sees the future in embedded finance and banking-as-a-service (BaaS). Isbank, for example, helped grocery delivery service Getir establish a banking service for its customers called GetirFinans in 2023, investing $50 million to gain a 20% stake. The bank also introduced what it says is the world’s first credit card that grants startups free cloud credits from Amazon Web Services.
Isbank has seen further growth, especially among young people, via a new app called Nays, offering things like person-to-person transfers, microcredit, foreign exchange, and contactless payments via QR code and near-field communication.
“In the future we will probably not need a discrete banking application because our banking applications will be everywhere, embedded in trading and e-commerce platforms,” Aran told Euromoney in early 2024.
Best investment bank: Citi
Retail investments in local stocks as a hedge against inflation meant Turkish equity capital markets issuance, including IPOs, was healthier than elsewhere in the region in 2023. Large and internationally orientated deals were still relatively rare, however. Turkey-targeted M&A has also seen less of a dip over the past two years than other regional markets such as Poland, according to Dealogic.
In this context, Turkey’s best investment bank, Citi, can boast an impressive array of work, including international deals. For example, it acted as joint global coordinator and joint bookrunner in a TL6.8 billion ($250 million) share sale of stock in Yapi Kredi Bank held by Koc Holding, via an accelerated equity offering that increased Yapi Kredi’s free float and the direct stake held by Koc, although the latter retains 61%.
In M&A, meanwhile, Citi was also exclusive financial adviser to Koc in a €400 million agreement with Stellantis in which the two group’s joint venture in Turkey would acquire 100% of the shares of Stellantis’ Turkey distribution company.
In addition, Citi was financial adviser to Czech energy firm CEZ on the sale of its 50% stake in AKCEZ to Torunlar Enerji and Başkentgaz. Citi was exclusive financial adviser to Oyak in a €673 million deal in which Taiwan Cement Company will acquire a 20% stake in Oyak, increasing its stake from 40% to 60% by investing €193 million, at the same time as increasing its stake in Cimpor Portugal from 40% to 100% by investing €480 million.
In debt capital markets, Citi’s work ranged from sovereign to sustainable bonds, bank issuance and more. This included a deal for the sovereign that was its largest conventional trade ever and that helped reopen the sub-investment grade market in 2023.
Citi worked on sustainable bonds for names such as TSKB, VakifBank, and Yapi Kredi as well as a tier-2 bond for QNB Finansbank that it says was the first tier-2 public eurobond transaction from Turkey in more than two years. It also helped airports company TAV issue an inaugural eurobond and was instrumental in a $330 million privately placed senior secured issuance by cruise port operator Global Ports.
Best digital bank: Akbank
In 2023, Akbank sold 70% of its credit cards and 90% of general-purpose loans through digital channels; and it was ranked first in digital credit card sales in the country. Over 80% of time deposit accounts were opened digitally and more than 96% of transactions, excluding cash, migrated to digital platforms.
Additionally, over 60% of new customers were acquired through digital onboarding, nearly doubling monthly digital customer acquisition year on year.
The bank launched the For You menu on Akbank Mobile, which offers personalized financial insights and consolidated financial management tools. It also launched Turkey’s first digital portfolio management product through Akbank Mobile.
In 2023, payment options were expanded on the bank’s Juzdan payment platform, which led to 51% growth in active users, a 79% increase in new users, a 54% rise in campaign enrollments, and significant growth in Pay with Juzdan transaction volumes.
Best bank for SMEs: QNB Finansbank
QNB Finansbank has improved several metrics across its small and medium-sized enterprise business, helped by its Digital Bridge project.
SMEs enrolling in Digital Bridge’s e-Transformation services can use e-Invoice and other products for free. Currently, many of the bank’s SME customers use this feature and thousands of new customers have been added since the campaign started. The Digital Bridge super app enables users to manage both banking and business processes in one application and 300,000 customers have done so.
The bank has also introduced a pre-accounting programme, digital marketing solutions, an e-commerce infrastructure provider and factoring solutions.
Best bank for ESG: Akbank
For the volume of sustainable finance being provided to the Turkish economy, as well as innovation in sustainability products, Akbank wins the award as best bank for environmental, social and governance this year.
It is one of the domestic market’s leaders in providing green and social loans to the corporate sector, and has recently upped its ambition to provide sustainable finance in support of the economy’s transition.
From an original target of providing TL200 billion ($6 billion) of sustainable finance by 2030, the bank has now committed to TL800 billion, with TL139 billion allocated last year.
A good chunk of that was in the form of green project-finance loans, mostly financing renewable-energy projects, clean transportation and circular economy sectors in the country.
The bank also collaborated with Turkish export guarantee company İhracatı Geliştirme (IGE) to introduce a financial support package for small and medium-sized enterprises that are trying to make their operations more sustainable.
The collaboration offers term loans of up to TL19 million, with 80% guaranteed by IGE. Some of the areas that qualify for the loans include renewable energy, energy efficiency, waste management, water and waste-water management, clean transportation and sustainable agriculture.
Together with its financing support, Akbank also led new innovations in sustainable finance last year, including Turkey’s first sustainable deposit product, which helps corporate clients contribute to projects aligned with the United Nations Sustainable Development Goals.
On launch in December last year, the product attracted five of the bank’s clients, who deposited a total of TL86 million.
Best bank for corporate responsibility: Isbank
In 2023, Isbank focused its corporate social responsibility efforts on expanding economic opportunities for women.
The bank introduced the Women’s Equity Fund, which invests in companies promoting equal opportunities for women in the workplace. Half the fund’s revenues support the Isbank Women’s Studies and Women’s Leadership programme, funding graduate, doctoral and post-doctoral research in women’s studies through Koç University Social Impact Forum.
In 2023, the bank launched the Women Empowerment Declaration, pledging TL100 billion ($3 billion) in financing for women entrepreneurs over five years. By the end of the year, it had disbursed TL34.95 billion in loans. Alongside this, the bank’s WeLead project reached 3,500 women, advancing gender inclusivity through partnerships with Arya Women Investment Platform and collaborations with TÜRKONFED and UN Women. These aim to provide TL100 billion in financing for women entrepreneurs by 2028.
Female representation at the bank stands at 53.18% of employees and 40.29% of managers, with a maternity leave return rate of 99.80%.
Best bank for diversity and inclusion: Alternatif Bank
In 2023, Alternatif Bank conducted a social impact analysis on accessible banking in Turkey in collaboration with Koç University Social Impact Forum.
It also expanded its Accessible Banking Terminology Dictionary project by incorporating 75 new terms. Supported by the European Fund for southeast Europe, this initiative generated 10,575,347 views across social media and digital platforms through 104 educational videos.
The bank also launched the podcast series Removing Barriers is Our Only Alternative, featuring sign language translations on YouTube, as part of its commitment to accessibility and community engagement. With six episodes and nine guest speakers, the series had had 29,319 views by year end.
The BlindLook visually impaired user experience mobile findings report evaluated the bank’s effectiveness in serving visually impaired clients. And following the 2023 earthquake, Alternatif Bank collaborated with the Robotel Association to provide advanced prosthetics to 50 children.
