Dear Stakeholders,

Despite the tough and challenging environment in and out of the country, the Turkish economy has continued to preserve its momentum. Growth in industrial production, continuous improvement in export figures, recovery in tourism income are the leading indicators to anticipate strong growth statistics for the first quarter of the year.

In parallel with the growing economy, the banking industry has continued its resilient, balanced and healthy development. Total assets of the system increased by 16.7% to TL 2.819 billion, total loans expanded by 18.3% to reach TL 1.788 billion. Growth in main indicators have been accompanied by strong capitalisation, more efficency and higher profitability.

It is definitely our proud to say that PASHA Bank as a dynamic market player keeps going on its expansion with the pace of above the market. As a result, the market share of the Bank has gone up, and its total assests have reached TL 585 million which is 15% higher compared to the prior year end. Our cash loan portfolio, comprising 85% of total assets in the quarter-end financials, increased by 23% and reached TL 498 million. As a result of the efficiency of our risk management framework, and prudent credit policy pursued by the Bank we have been succesful in preserving zero level of NPL in our balance sheet.

During the period we have intensified our efforts to increase and diversify funding sources beyond equity and toward available market instruments. Succesful bond issuance could be typical examples for the efforts directed to support the entreprenurs in our target region and have continued to contribute to the economies in the region.

Effective corporate governance is an important foundation for PASHA Bank’s strong performance and is fundamental to our success. Corporate governance provides proper oversight and accountability, strengthens internal and external relationships, builds trust with our stakeholders and promotes the long-term interests of shareholders. PASHA Bank has further increased the corporate governance rating given on the basis of the principles set forth by the Capital Markets Board to 9.26 from 8.94 in the previous operating period. This is clear determination of the Bank to apply best class corporate governance principles and its willingness to manage this process dynamically and continuosuly.

In the end of 2016, the Azerbaijani government introduced set of Strategy Road Map documents on national economy, where strategic objectives of the government were set and initiatives clearly defined. Policy reaction of governments have been already translated into the figures, the goods, FDI, tourism flows within the triangle have intensified and are expected to expand further in the coming period. In line with the aim of becoming the primary bank for the entrepreneurs involved in international trade within the triangle of Turkey, Azerbaijan, and Georgia, we will work in 2017 to the best of our ability to create increased value for all our stakeholders and to carry them to new heights by diversifying our product and service range.

We will support our operational profitability with new customer acquisitions and the controlled cost management created by our Group synergy. We shall continue our efforts of offering products and services that are tailored to our customers’ needs to make banking experience a gainful experience with PASHA Bank.

In addition, we will focus on building PASHA Bank’s 2020 vision and strategy priorities, the second phase of our growth strategy which will strive to set more ambitious targets reinforcing the infrastructure we have built in the first three-year strategy period.

I would like to take this opportunity to thank our valued employees and our management team for their dedicated professional work, our customers for their confidence in PASHA Bank and our shareholders and all business partners for their valuable support.

Sincerely Yours,

Jalal Gasimov
Chairman