4Q16 in line, further thoughts on capital and 2017E targets
TSKB has announced TRY 110m in net income for 4Q16, in line with the TRY 111m consensus. At the end of 2016, the bank also opted to set aside TRY 15m in free provisions for the quarter, which implies that 4Q was actually better than reflected by the reported bottom line. In 2016, TSKB recorded healthy bottom-line growth of 17%. There were no hiccups in asset quality, despite the major depreciation in 2015. The margin and profitability were kept at the targeted levels of 3.5% and 18%, respectively. We believe that management’s tone on 2017E was positive and, as long as the cost of risk remains at the manageable levels that the bank is targeting, this should be a positive year for TSKB, in our view. Capital is more of a concern at this point, but we calculate that TSKB can boost its CAR with a subordinated issue without hurting its ROE profile significantly. We rate TSKB a BUY, with a price target of TRY 1.78/share. The bank trades at 5.8x P/E and 0.9 P/TBV on our estimates for 2017E.TSKB Gayrimenkul Yatirim Ortakligi AS. TSKB Gayrimenkul Yatirim Ortakligi AS (TSKB GYO) is a Turkey-based real estate investment company. The Company is primarily an investment institution engaged in the investment and development of real estate projects in Turkey. Its real estate portfolio includes : two office buildings in Findikli, Istanbul with approximately 20,000 square meters of area, an office building in Karakoy, Istanbul with an area of 3,198 square meters, Pendorya Shopping Center Project in Pendik, Istanbul with 80,642 square meters of indoor area, and a piece of land in Seyhan, Adana with a city hotel project under development. The Company focuses on retail parks and mixed-use projects primarily in and around the city of Istanbul and in other parts of Turkey. TSKB GYO is a subsidiary of Turkiye Sinai Kalkinma Bankasi A.S.
WOOD & Company is the leading investment bank in Emerging Europe. Founded in 1991 and head-quartered in Prague, our footprint spans the region and touches investors around the globe.
A pioneer in Emerging Europe, WOOD executed many of the first CEE equity trades and landmark investment banking transactions. Our electronic trading platform was the first in the region, and remains the best. We are continually expanding our relevance and reach in these ever-evolving markets.
Our equity market share reflects our stature: 7% in Warsaw, 20% in Bucharest, 16% in Hungary, 40% in Prague and 5% in Vienna. Our distribution is unparalleled, with the largest salesforce in the region, servicing a uniquely diverse investor base.
We couple local expertise with a truly international perspective. With offices on the ground in the region, and in key financial hubs such as London and Milano, we are never far from our clients and we remain at the forefront of what’s afoot in the CEE emerging and frontier landscape.
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