Ladies and gentlemen, welcome to İş Bank's 2023 1st half financial results audio webcast. Our presentation will be hosted by Ms. Gamze Yalcin, CFO, and Ms. Nilgün Yosef, Head of IR and Sustainability. A Q&A session will follow the presentation. If you wish to ask a question, please raise your hand or use the Q&A area to type your question. Now, I leave the floor to our presenters. Thank you, Ozge. Hello, everyone, and welcome to our earnings presentation for the second quarter. This is Gamze speaking. Thank you all for joining. Before going into the details, I would like to touch upon the highlights of the period. As we all know, the operating environment was mainly shaped by the macroprudential regulations. However, we have remained resilient and adaptive, as reflected on our strong set of financials. We have focused on maintaining our robust position in the market via delivering value to our customers by developing new products and services in line with our strategy. One of the highlights of the period was that we were successful at defending our net interest margins despite increased cost of deposits. We also received a stable but still conservative contribution from our CPI linkers portfolio in line with our valuation methodology. Not limited with this, of course, indeed, each and every business we are operating in contributed strongly to our robust profitability. Among all, let me emphasize once again our eye-catching fee generation performance across the board, even in an environment where lending activities were limited due to regulations. We achieved the largest fee income base among peers as an outcome of our ongoing concentration in line with our payment system strategy. On top of our robust core revenue performance, we again received a very solid income from our subsidiary portfolio, which has a well-diversified base. Regarding the asset quality, once again, we achieved the highest collection performance among peers. In line with our conservative approach, during the quarter, we continued with our prudent loan loss provisioning and increased our NPL coverage ratio to 81% from 77% level. Over the periods, despite many challenges, we maintained our solid capitalization levels, even without the face forbearance measures. These levels are definitely strong enough to absorb any potential adversities in the economy or to support future growth. This is valid for the liquidity levels as well. Last but not least, during the quarter, we observed a post-election normalization in the operating environment. Please remember that on top of our TL 6.5 billion base of pre-provisions, in the last quarter of 2022, we set aside additional TL 2 billion, taking into account uncertainties of the period. Regarding post-election path to normalization in the operating environment, including regulations as well as saving uncertainties like early retirement schemes, this quarter we released that additional TL 2 billion. Please note, we still keep our strong cushion of pre-provisions at TL 6.5 billion on our balance sheet, indicating the highest level among private peers. On the next page, we have a summary of our first half performance. As you can see, our results in the first half of the year were in line with our full year guidance, despite challenges. Please note, we have a higher than the guided growth in our net fee income and operating expenses, largely offsetting each other. I have already mentioned about the background of our overperformance in net fees. Regarding the OpEx growth, it includes inflation adjustments as well as earthquake-related expenses and business development costs. Here, I would like to mention also our inflation-adjusted performance. During the quarter, we have disclosed our year-end IFRS financials on our website. Our inflation-adjusted ROE has been the highest among the peers, with almost 20% level, thanks to our well-balanced and diversified balance sheet structure, as well as our conservative stance in valuing our CPI linker portfolio. It is expected that inflation accounting will be effective next year, our inflation-adjusted results are expected to continue with this kind of high performance. On the next page, we have the major P&L items as well as the profitability and efficiency indicators. Due to increasing funding costs on a quarterly basis, our swap-adjusted net interest income declined by 22.6%. On an annual basis, it posted an increase of 24%. Clean trading income was increased by 248% quarterly, supported by fixed income buying and selling activities, as well as valuations of interest rate hedging positions. Thanks to our continuous efforts, our outstanding net fee income generation capacity and performance continues, carrying the annual growth further up above 108% level. Income from participations was also notable in this quarter at 11 billion TL, providing a well-diversified and consistent income base for the bank. I have already explained the growth in OpEx figure. Please note, on a quarterly basis, adjusted OpEx declined by 8.4%, mostly related with earthquake expenses. Of course, these expenses are in line with our strong social responsibility approach and sustainability framework. All in all, our return on equity in the second quarter stood at 37%, carrying the first half ROE to 32%. When adjusted for free provisions, our first half ROE will be at 34%. I will leave the floor to Nilgün for the details of the bank's performance. Thank you, Gamze. Welcome all, and thank you for joining the webcast. In this slide, you can see the main balance sheet items. In this quarter, we strategically managed our loan growth in the face of regulatory framework with short-term and TL loan focus. Compared to year-end, our TL lending growth was 19%, mainly stemming from the retail side. In line with our budget, fixed lending continued to decline in the first half by 4%. On the funding side, we maintained our concentration on widespread granular core deposit base. There was around 24% additional quarterly growth in TL deposits, carrying to year-to-date increase to 41%. Fixed deposits on the other end declined by 11% in this quarter. As you know, İş Bank has the largest demand deposit base among peers. In Q2, despite the significant increase in deposit rates, share of demand deposits stood at 45%, providing substantial support to our funding cost base. Moreover, core deposits, which are sticky in nature, make up around 77% of total deposits. As for the external liabilities, our total external dues were $6.8 billion, of which $4.5 billion is due in the next 12-month period. Against that, our fixed liquid assets are more than enough to cover short-term repayment amounts. Fixed LCR was again at comfortable levels, at 442%. ESG remains as a priority in a fixed wholesale funding. Since 2021, fixed funds that we have raised have been entirely ESG-linked. Furthermore, share of sustainable funding is around 34%. On the next page, we have the NIM and spread evolution. In the second quarter, swap-adjusted net interest margin declined to 4.3% due to given market conditions. However, we achieved a more than 5% level in the first half. Of course, pressure on swap-adjusted NIM will be proactively managed in the second half of the year, taking us to around 5% level. As of the end of June, share of securities in total assets was 19%. On the TL side, while we added TL fixed income securities to the portfolio as a result of regulatory framework, we maintained the diversified structure of the book via purchasing further floating rate securities. At the end of Q2, these floating rate notes, which provide a natural hedge to our portfolio, comprised around 60% of TL securities. As of the end of second quarter, our CPI linker portfolio make up 40% of TL securities, contributing to our income base by TL 8 billion. As you know, we are using 12 months ahead CPI expectation for the valuation of CPI linkers portfolio. Unlike market trends, we haven't experienced a decline in our CPI linker revenue, thanks to our conservative methodology. On our next slide, I will summarize the fee income performance. As you already know, in the recent years, we have been focusing more strongly on the fee-generating business as a way of boosting income base without consuming capital. In line with this strategy, fee income generation was again remarkable in this quarter. We have reached the largest fee base among peers as of the first half, with more than 108% annual increase. Drivers of the strong growth were again across the board, including payment systems, asset management, and money transfers. Thanks to our efforts in diversifying fee base, we achieved this high performance in an environment where loan growth was limited due to the regulatory restrictions. Ongoing efforts to enrich the type and scope of fee-based services on digital channels will be supporting the fee growth going forward. Next page shows the NPL and provisioning trends. In the second quarter, we have seen further improvement in our asset quality metrics. Our NPL ratio declined to 2.2%. Thanks to our outstanding collection performance and limited inflows, quarterly net NPL formation was 44 basis points in Q2. Our total net cost of risk, including currency impact, increased to 137 basis points for the first half. This figure also includes model calibrations impact. Furthermore, as part of our prudent approach, we increased our NPL coverage ratio to 81%, highest among peers. Please note that on top of that, more than sufficient loan loss provisions, we have a free provision buffer of TL 6.5 billion, as we mentioned. Next page shows the capitalization levels. Our capital ratios remained at solid levels at the end of Q2. Capital adequacy ratio without the BRSA's forbearance measures stood at 18.3%, while Common Equity Tier 1 was at 14.9%. We believe that our capital levels are strong enough to absorb the potential adversities in the economy. As we always share, sensitivity of our capital adequacy ratio to 10% depreciation in TL is limited to around 50 basis points, while sensitivity to 100 basis points increase in TL interest rate is around 15 basis points. This concludes my first half performance presentation. I will leave the floor back to Gamze for providing a color for the remaining part of the year. Thank you, Nilgün. On this slide, I will try to summarize key areas of our focus for the second half. Moving forward, of course, we are aiming to achieve a similar performance for the remaining part of the year. However, the pace and timing of the normalization process will be a key factor. Pressure on swap-adjusted net interest margin will be effectively managed, and we aim to achieve a level at around 5%. Contribution of fee income will increase. This item suggests an upside potential exceeding 100%. Cost management is definitely under spotlight, so we believe OpEx to be around 100% level. As always, we will have an ongoing focus on asset quality. We aim to stay well-prepared to navigate through any potential challenges if occurs in the operating environment. Regarding the funding base, we will pursue a diversified approach if market conditions are favorable with the non-deposit funding. Needless to say, we will sustain our solid capital and liquidity levels. All in all, we aim to maintain our ROE levels for the full year. This concludes our earnings presentation. You can see more details, both on our financial and non-financial performance, in the annex part of the presentation. Thank you for your attention. I would now like to open the floor for your questions. Quick reminder, if you wish to ask a question, please raise your hand or type your question into the Q&A area. At this moment, we have a written question from Tomasz Noetzel, Bloomberg Intelligence. I will be just reading the question for you: Can you please walk us through inflation accounting and how to look into 2024? What would be first half ROE adjusted for inflation, and what would be your full year ROE target this year? Okay. Thank you for the question. İşbank's balance sheet structure, as we always share, is relatively well-positioned against inflation. First of all, our subsidiaries and participations portfolio includes real sector and real estate investments that will be positively contributing to inflation adjustment. Secondly, as we always emphasize, in our CPI linker valuations, we use the 12-month ahead expectation rates, in the sense that we do not adjust with the actual October to October CPI at the year-end. So this approach, in terms of valuing CPI linker portfolio, provides another positive contribution. Accordingly, when we look at our performance, as I already mentioned, thanks to our well-balanced and diversified balance sheet structure, as well as our conservative stance in valuations, we achieved by the year-end, as I said, almost 20% ROE, inflation-adjusted ROE. For this June-end figures are still in process. We will be sharing the June and inflation-adjusted figures soon in the coming period. What we can say is that it will again stay at close to these high levels. Definitely, we expect to see mid to high teen performance, ROE performance, under inflation adjustments. Thank you, Gamze. We have a question from Mehmet Sevim, J.P. Morgan. Mehmet, I have a lot. Good evening. Thanks so much for the presentation. I have a couple questions, please. First of all, just on maybe starting with the deposit costs, we've seen a significant drop in them recently. Could you please share with us where you're pricing deposits at the moment, and whether there is any difference in your pricing strategy versus peers? I'm asking specifically with regards to your previous approach in terms of balancing regulations with deposit pricing that you followed. Where do you see deposit costs evolve in the second half of the year? Do you think there is a trough that, you know, they will reach and then stay there, given obviously, other considerations, including the CPI level still and the attractiveness of Turkish lira deposits? Second question on your CPI-linked portfolio. Also, as you mentioned, given you value them using CBRT 12 months ahead CPI projections, I just wanted to check if the recent revisions of the CBRT to CPI expectations for next year and also this year will cause a change in the way you value them, or at least to the, to the, valuation numbers that we'll see in the coming quarters. Just on your comment on CPI-adjusted accounting, I think you hinted earlier that you expect that to come into force in 2024. Can I just confirm that that's the case, and whether this is your expectation or have there been any developments recently that, that I may have missed? Thank you very much. Thank you, Mehmet, for the questions. For the first part of your question, currently, interest rates we offer for new deposits hover around 25% on average. Of course, the blended average cost of TL deposits is around 20%. For the second part of the question, inflation accounting, for the when I share the figure, almost 20%, it is for the year, last year and 2022 year end. For June end figures, we are still working on it. We will be disclosing a similar level for June end figures. Of course, for the next year, it will be, as I said, mid to high teen figures. As for the regulatory frame work part, it is expected that it will be effective for next year. I believe, these are the questions. If I missed any part of your question, Mehmet, please. Yeah. Thank you so much, Gamze. Very helpful. I just wanted to check maybe if you had any color on deposit pricing in the second half of the year, how you expect? Okay. Sorry. to evolve from here. Sorry. Also, just, just the CPI linker portfolio valuation, just with regards to the CBRT's revisions recently, should we expect any change in the, in the numbers going forward? We do not plan to change our CPI linker valuation methodology. As you know, as we always share, we we are using the 12 months ahead inflation expectations. What we use is 30% levels. Coming to the deposit rates in the next half of the year, we can say that we will be observing a downward trend in the deposit costs. I believe it will continue. Of course, this is very much in line with the expectations. When you consider the inflation expectations, for example, for the coming 3-month period, and when you compare the deposit rates proposed to the customers for that period, again, they are, they can be called as indeed favorable for the customers. What we can say is that TL deposit rates, even though they hover at around 25% levels, and what we expect to see that nowadays, let me say, marginal base, is at around 30% levels. If you make the comparison with the expectation for inflation and compare it with the marginal base at low 30s figures, for example, nowadays, it's still a very favorable, attractive instrument for the depositors. If you compare the alternatives of the customers, indeed, it's very limited, as you know, in terms of the instrument variety for protecting your principal against inflation. This is still attractive instruments for the depositors, what we see. Great. Thank you, Gamze, for your comments. Thank you. We have a couple of more written questions. One question says: Do you plan to revise your CPI estimation for relation? I believe this has been already answered. Valentina Stoykova from Barclays asks: Will you please state how much FX-protected security you had as of a half term, 23, in $ billion? Can you please repeat the sensitivity of capital adequacy and interest rate sensitivity? Okay. Thank you for the question, Valentina. The FX liquidity for the end of June figure is being asked. We can say that it's hovering at around $9 billion. The other question, and before going with the next part of the question, I should also mention that we believe that when you look at our FX LCR, or when you look at the FX in nominal terms, and when you compare it with the coming FX liabilities, we believe that we have comfortable, strong cushions in terms of FX liquidity. Coming to the second part of the question, sensitivity of CAR to Turkish dollar, Turkish lira rate and 100 bits TL interest rates. 10% depreciation in Turkish lira leads to, like, 50 bits deterioration in the capital adequacy ratio. At 100 bits, Turkish lira interest rates increase leads to 15 bits deterioration. Actually, Valentina has another question. She says, "Your year-end goals, on your year-end goals, can you elaborate a bit more on your asset quality goals for financial year 2023, and also on your capitalization and FX liquidity targets for the year? Okay. Thank you for the question. As we have also shared during the presentation, we definitely aim to stay well prepared and navigate through any potential challenges in the operating environment. Indeed, as we also share, we are comfortable with our loan loss provisioning levels. As we shared NPL, for the NPL stage, for stage three, we have further increased our coverage ratio by 3.3 percentage points, and it's now 81%. This is the highest level among the peers. Please also note that we have another on top of that sufficient loan loss provisioning, we have a free provision buffer of TRY 6.5 billion. During the quarter, we have revised our expected loss modelings. We also observed the impact coming from the model calibrations as well. We have also seen the earthquake impact as well. We believe that this asset quality seems to be very much on track with our expectations, indeed, providing an upside potential in that sense. When we look at the targets for capital adequacy and liquidity, as we shared amongst our guidance set, we still keep a capital adequacy ratio about 15% levels. Of course, we aim to have a higher level and as we always provide a higher level, this is the minimum level that we would like to present to yourself. Capital adequacy ratio is targeted to be above 15% level. For the definitely a fixed liquidity definitely year-end figure will not be lower than the levels that we shared in the presentation. As you can see, we still have a very strong, a fixed liquidity coverage ratio. Of course, we continue with our non-deposit funding transactions as well. Very recently, last week, we shared another bilateral agreement with an IFI. This is, of course, not the only transaction, but we continue to beef up our strong FX liquidity buffer. In short, as an answer to your question, year-end FX liquidity will not be lower than this level, what we see for the June end. It will be probably higher than that level because we'll continue with our FX liquidity transactions as a usual business case. I believe we have no more questions. I now hand over to Gamze for closing remarks. Thank you, Ozge. I would like to thank all of you for your participation. We believe that we have presented another solid performance indicating resilience and expertise in navigating challenging operating environments. Of course, regarding the details, as always, let's stay in touch. Looking forward to see you all in person soon. Until then, stay safe and healthy.