BGC Partners - GARAN 1Q19 Update: Robust core spreads and profitability
Garanti Bank reported TL1,722mn unconsolidated net income in 1Q19, slightly above the TL1,568mn consensus and TL1,530mn BGC estimates. We assess that the results were slightly stronger than expectations, despite TL100mn of free provisions, mainly thanks to a more robust core spread, while the remaining balance sheet and P&L items were all broadly in line with our forecasts. In summary, following significant deleveraging in previous few quarters, Garanti sharply grew in TL business loans while margins were supported by declining TL deposit costs, partially offsetting lower revenues from CPI-linkers. While fee growth remained robust, NPL formation and operating expenses were relatively under check. As such, 1Q19 ROE was realised as 14.5%, providing a comfortable cushion for the bank to meet its 2019 guidance of low-teens ROE.Turkiye Garanti Bankasi is a private banking group based in Turkey. Co. operates as an integrated financial services group in every segment of the sector including corporate, commercial, SME, payment systems, retail, private and investment banking together with subsidiaries in pension and life insurance, leasing, factoring, brokerage, and asset management. Co. provides a range of financial services to 13 million customers through a distribution network of 994 domestic branches; 6 foreign branches in Cyprus, Luxembourg and Malta; 3 international representative offices in London, Dusseldorf and Shanghai with more than 4,152 ATMs, a Call Center and internet.
BGC has been one of the major market players in Turkish OTC debt, FX and swaps markets since 1998.
We started offering corporate finance and investment banking services to our clients in 2013. We offer a complete range of financial services to help our clients achieve their goals. Our main areas of activity within investment banking are as follows:
- Mergers & Acquisitions
- Equity Capital Markets
- Debt Finance & Advisory
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