6 January 2017

ANALYST & INVESTOR DAY

MANAGEMENT

MR. ADNAN BALi

MR. ERTUĞRULBOZGEDiK

MR. ERGÜNYORULMAZ

MR. MAHMUTMAGEMiZOĞLU

MR. YALÇIN SEZEN

MR. MURAT BiLGiÇ

MR. HAKAN ARAN

MS. SENAR AKKUŞ

MR. N. BURAKSEYREK

MR. LEVENT KORBA

MR. YILMAZ ERTÜRK

Director and Chief Executive Officer

31 years at İşbank

Deputy Chief Executive31 years at İşbankCorporate Loans, SME Loans, Commercial Loans and Consumer Loans Underwriting, Credits Portfolio Management, Financial Analysis

Deputy Chief Executive34 years at İşbankCommercial Banking,Retail Banking and General Deliberation Legal Counsellorship, Corporate, Commercial and Retail Loans Monitoring and Recovery Management

Senior Deputy Chief Executive34 years at İşbankFinancial Management, Investor Relations, Managerial Reporting and Internal Accounting, Strategy and Corporate Performance ManagementSubsidiaries

Deputy Chief Executive30 years at İşbankConsumer Loans, Card Payment Systems, Digital Banking, Retail Banking Marketing, Sales and Product Management, Retail Loan and Card Operations, Private Banking Marketing and Sales Management

Deputy Chief Executive26 years at İşbankCorporate, Commercial and SME Banking Marketing, Sales and Product Management, Free Zone Branches, Branches Abroad and Foreign Representatives

Deputy Chief Executive27 years at İşbankDigital Banking Operations, Information Technologies, Data Management

Deputy Chief Executive26 years at İşbankTreasury, Capital Markets, Corporate Communications

Deputy Chief Executive26 years at İşbankHR, Talent Management, Enterprise Architecture 1

Deputy Chief Executive31 years at İşbankBanking Operations and Payment Operations, Support Services and Purchasing, Foreign Trade and Commercial Loan Operations, Internal Operations, Construction and Real Estate Management, Branch Network Development

Deputy Chief Executive30 years at İşbankEconomic Research, International Financial Institutions

2016 – STRONG PERFORMANCE IN PROFITABILITY

2012

2012

2012

2013

2013

2013

2014

2014

2014

2015

2015

2015

2016 Q3 (2)

2016 Q3

2016 Q3 (2)

16.5%

19,014

13.7%

21,593

13.1%

24,359

2.3%1.8%

1.7%1.3%

1.7%

10.4%

26,718

12.8%

29,256

19.0%

22,719

15.6%

23,579

15.4%

35,021

14.8%

29,311

12.1%

32,035

RoAE RoATE(1)

(1) Tangible Equity (TE) is calculated by the deduction of M-t-M valuation differences regarding AFS portfolio, listed participations and real estate portfolio from shareholders’ equity.(2) Calculations are based on trailing four quarters’ data.(3) Risk Weighted Assets (RWAs) include risk weighted amounts calculated for credit risk, market risk and operational risk.

Tangible Equity(1) Shareholders’ Equity

RoAE & RoATE (1) RoRWA(3)

TANGIBLE EQUITY & SHAREHOLDERS’ EQUITY (TL mn)

2

2016 – STRONG PERFORMANCE IN MAJOR PROFIT DRIVERS

6,522

8,846

20.7%

1,7265,867

18.5%

7,121

10,405

8.7%

2,036

7,806

10,705

6.4%

2,046

2016 9M

(1) Excluding account keeping fees for only retail accounts(2) Calculations are based on trailing four quarters’ data.(3) Adjusted for non-recurring and other items

2016 9M

OPEX OPEX

2016 9M2016 9M

2016 9M

2016 9M2015 9M

2015 9M

Total Op. Income

Total Op. Income

2015 9M2015 9M

2015 9M

2015 9M

NII

ReportedReported

NFCNII (Incl. Swap Cost)

Adjusted(3) Adjusted(3)

NFC (Acc. Keep. Fees Excl.)(1)

19.7%

21.0%

18.5%23.5%21.4%

20.4%

NET INTEREST INCOME NET FEES & COMMISSIONS

TOTAL OPERATING INCOME POSITIVE JAWS (2016 9M)(2)

8,638

3

1,620

ON TRACK TOWARDS 2016 TARGETS

(1) Year-to-date(2) (Specific Loan Loss Provisions + General Loan Loss Provisions ) / Average Performing Loans(3) Based on MIS data(4) Adjusted for non-recurring and other items(5) Calculations are based on trailing four quarters’ data.

2015

Loan Growth 10%-12%

13%-14%

+60 bps

115 -125 bps

>14%

3.7%– 3.9%

>15%

Decrease

1.2% - 1.3%

6.5%(1)

8.0%(1)

2.6%

132 bps

15.8%

4.18%

18.5%

43.7%

1.5%

14.0%

15.2%

2.0%

114 bps

15.6%

3.80%

19.2%

47.0%

1.2%

Deposit Growth

NPL Ratio

Capital Adequacy Ratio

Net Fees & Commissions Growth

Return on Average Assets(5)

Cost to Income Ratio(4) (5)

Net Interest Margin(3)

Gross Cost of Risk(2)

2016 9M 2016 Expectations

4

BANKING SECTOR MAIN CHALLENGES

Macroeconomic & Geopolitical Headwinds

Mild economic growthFlat – increasing interest rate environment Pressure on EM currenciesThreats to credit rating

Mobility

Disintermediation

Digital players

Technology enabled customers Switching to digital channels Demanding better service at lower costs Increased importance of customer-centric business approach

Maintaining & Improving Customer Relationship

Technology & New Competitors

5

MACROECONOMIC & GEOPOLITICAL HEADWINDS

FINANCIAL INDICATORS 2016 (change compared to the end of 2015(1))2016: A quite exceptional year for the global economy, emerging economies hit harder…

Brexit & strengthened anti-establishment movements in Europe

Rising geopolitical risks

US presidential election - Trump’s victory

Shifts in expectations for the Fed’s policy normalization process

OPEC talks & volatility in oil prices

Uncertainties on economic policies by the major economies

Unexpected domestic developments

2119

3-12

USD / Local Currency (%)

Turkey

South Africa

Mexico

Brazil

EM(2)

Russia-16

-18

28-100

-162

5-Year Treasury Bond Yields (bps, local currency)

Mexico

South AfricaTurkey

RussiaBrazil-526

147

-118-130

-14

5-Year CDS (bps)

Turkey

South AfricaMexico

RussiaBrazil-215

1

Source: Datastream(1) As of 30 December, 2016.(2) MSCI Emerging Markets Currency Index

6

A slight recovery in Turkish economy in 2017 along with the modest global economic growth…

Mild economic growth despite challenging environment

Domestic demand-driven growth profile

Pick-up in public spending without any distorting effect on fiscal indicators

Easing of macroprudential measures

A stable current account outlook

A comprehensive structural reform agenda

Continued capital inflows

Source: Datastream, Turkstat, BRSA (F) Forecast Ratios based on the new GDP series

2015 2016F 2017F 2018F 2019F

6.1%

3.7% 3.9% 4.2% 4.4% 4.3%

2.5% 3.3% 4.0% 4.5%

Real GDP Growth

CAD/GDP

SUSTAINABLE GDP GROWTH & CAD

MACRO EXPECTATIONS

2015 2016F 2017F 2018F 2019F

1.0%

27.5% 27.7% 27.4% 27.1% 26.7%

1.3% 1.6% 1.4% 1.1% Budget Deficit / GDP

Public debtstock / GDP

PRUDENT FISCAL STANCE

2015 2016 2017F 2018F 2019F

8.8% 8.5% 8.5%7.5% 7.0%

CPI INFLATION ABOVE 5% TARGET

2015 2016 2017F 2018F 2019F

17% 17%12% 12% 13%

20%17%

12% 13% 13%Deposit

Loan

ANNUAL DEPOSIT & LOAN GROWTH

7

MACROECONOMIC & GEOPOLITICAL HEADWINDS

MAINTAINING & IMPROVING CUSTOMER RELATIONSHIP

Multi-channel Access

Individual Customer Value

Trust

Operational Excellence

Customer

8

TECHNOLOGY AND NEW COMPETITORS

Technology Competitors

Improving Customer Services

DIGITALISATIONPricingEfficiency

Attack by...

9

STRATEGIC APPROACH OF ISBANK

SUSTAINABLE & PROFITABLE GROWTH

PROFITABILITY

WELL-BALANCED,SELECTIVE AND

PRIORITISED GROWTH

EFFECTIVERISK

MANAGEMENT

PROACTIVEMANAGEMENT

OF FUNDING

ASSET QUALITY

10

WELL-BALANCED, SELECTIVE AND PRIORITISED GROWTH

Improved Customer

Experience

More Digital

Customers

Focus on Profitable

Segments with a Risk-Return

Approach Fee Business

AND

ProfitableCustomer

Base

Core Banking Revenue

ROE

INCR

EASE

IN

11

DISRUPTIVE ENVIRONMENT IN DIGITAL ERA

DIGITAL IS DISINTERMEDIATION

ENTRY BARRIERS BIG DATA & CUSTOMER FOOTPRINT CUSTOMER EXPERIENCE

DISAPPEARING CONVENTIONAL ROLES SIMPLIFICATION IN BUSINESS MODELS

12

DIGITALISATION

CUSTOMEREXPERIENCE

ORGANISATION TECHNOLOGY

INNOVATION ECOSYSTEM

Innovation CX DigitalTransformation

Collaboration

Big Data Multi-channelAccess

OperationsCenter Data Center

InnovationCulture

Relation withFintechs

InnovativeDigital Services 13

DIGITALISATION – INNOVATION (IDEA GENERATION CONTEST)

14

DIGITALISATION – INNOVATION (KOLEKTIF HOUSE)

15

DIGITALISATION – INNOVATION (INSTANT SERVICE PLATFORM)

16

DIGITALISATION – UNIONPAY ECOSYSTEM

17

DIGITALISATION – VIRTUAL POS ECOSYSTEM

18

DIGITALISATION – PIRI ECOSYSTEM

19

DIGITALISATION – TECHNOLOGY (DATA CENTER)

20

DIGITALISATION – TECHNOLOGY (OPERATIONS CENTER)

21

DIGITALISATION

74.8%

37.6%

30.3% 32.0% 31.1%28.8%

28.0%25.2%

2.2% 4.3% 9.4%19.0% 24.3%

31.7%36.1% 35.7%

29.1%

26.3%

23.0%

77.6% 80.5% 80.6% 82.3% 83.7%

DIGITAL BANKING MARKET SHARES(1)

2011 2012 2013

Term Deposits AutomaticPayments

GPLs

2014 2015 2016/11

Total Non-Branch Internet BankingMobile Banking ATM

51.9% 47.3%

16.2%

# Transactions

23.2%

10.7%

10.0%

9.5%

37.4%

21.2%

17.7%

17.3 %

Investment

Credit Cards

Money Transfer

Payments

Mobile Banking Internet

(1) Source: TBA, as of 2016 Q3(2) Unit sales, as of 2016/11

3,6332,766

Mobile Banking Internet Banking

2011 2016

18x1.7x

1,620

207

EVOLUTION OF SHARE OF TRANSACTIONS PER CHANNEL DIGITAL BANKING – NUMBER OF CUSTOMERS (‘000)

SHARE OF DIGITAL CHANNELS IN RETAIL SALES(2)

22

ASSET COMPOSITION

2015 2016 Q3 2017

Cash & Banks

Securities

Loans

Participations& Other Assets

7.5%

64.2%

12.0%

292,882

16.2%

64.4%

11.6%

16.7%

65%

12%

16%

7.3% 7%

6.2%275,718

COMPOSITION OF TOTAL ASSETS (TL mn)

23

LOAN GROWTH

Credit Cards

2015 2016 Q3

2015 2016 Q3

GPLs (inc. overdraft acc.)

Auto Loans

Co r p . & Co m m .

Housing Loans

SME*

9.2%

46,797

66,340

9.2%

17.6% 16.9%

13.9%

35.0%

13.8%

32.6%

0.7%

23.6%

0.5%

26.9%

3.0%

7.0%

20.3%

48,196

70,998

Retail

Non

-Retail

SME

Project Finance

Other Corporate

22,3034.0%

47.2%

3.8%

49.8% 49.0%

46.2%

5.1% 23,432

Loan Growth Expectations

12% -13%

13%-14%13%-14%13%-14%

7%-8%

Total Loans

TL LoansRetail LoansNon-Retail Loans

FX Loans (USD)

2017

COMPOSITION OF TL LOANS (TL mn) COMPOSITION OF FX LOANS (USD mn)

24

(*) SME definition includes companies with number of employees <250 and turnover or total assets <= TL 40 mn.

LOWEST NPL RATIO(1) AMONG PEERS MAINTAINED

Sector

Peer 1

Peer 2(1)

Peer 3(1)

İşbank

İşbank Peer 1 Peer 2 Peer 3Share in Loans

ConsumerLoans

132126

103 96

(1) Adjusted for NPL sales in 2016 9M (2) SME definition includes companies with # of employees <250 and turnover or total assets <=TL 40 mn.(3) Net COR = (Specific Loan Loss Provisions + General Loan Loss Provisions - Specific Provision Reversals) / Average Performing Loans

CreditCards

SME Loans(2)

Corp. & Comm.Loans

Gross CoR Gross CoR

Collections Collections

General General

Specific Specific

Net CoR Net CoR

TotalLoans

2.6%

11788

113

15

-29 -30

1513

13

83

3.6%

19.7%

7.6%

6.7%

4.6%

22.0%

3.3%

4.8%

3.4%

2.7%

2.6%6.0% 3.6%

51.6%

1.6%

1.9%

3.3%

4.1%

4.8%

4.0%

2016 9M 2017

NPL RATIOS BY LOAN CATEGORIES (2016 Q3) SHARE OF GROUP II IN TOTAL LOANS (2016 Q3)

COST OF RISK(3) (BPS)

25

Less than 3.0% NPL Ratio

2017

EQUITY PARTICIPATIONS STRATEGY

FinancialListed

GlassNon-Listed

Other

19.9%

80.1%

Participation

VALUE CREATION

44.4% 13.1%

13.9% 25.3%

11.5% 16.6%

Şişecam

Anadolu Hayat

TSKB

Share in Total BV(2016 Q3)

47.8%

7.8%

44.4%

Divestiture of non-core/non-strategic companies

Enhancing the alignment of financial sector companies

Ensuring a stable and satisfactory dividend revenue

Dividend income from participations2016: TL 682 mn, 2017: ~ TL 690 mn

(*) Annual return on investment calculated for the last 5 years, including cash dividend payments and M-t-M changes.

12.2%

8.4% 8.7%

10.6%

9.7%

11.6%

2011 2012 2013 2014 2015 2016 Q3

PARTICIPATION MIX (2016 Q3) DIVIDEND INCOME / PARTICIPATIONS AT COST

26

Annual RoI*

Annual Return on Investment for listed participations: 15.6% for the last five years

PROACTIVE FUNDING MANAGEMENT

Deposits

Participations & Other Assets

Loans

Equity &Other

Financial Assets

Funding MT/LT(1)

Funding ST(1)82.8

21.5

188.6

37.6%

13.2%7.5% 7.5%

34.2%

2017 2018 2019 2020 >=2021

16.1%

166.1

44.327.954.6

Eurobond Subordinated Debt Other Funds Borrowed Securitization Syndication

15.9%

9.4%

9.6%

8.1%

27.0%

100.0%

30.0%

2,441

Decrease

Expectations

Share

2017

1,435

1,462

14%-15%

1,237

4,138

>15%

15,306

4,593

6%-8%

Syndication

Loans / Deposits

Subordinated Debt

Securitization

Repo&Money Market

Other Funds Borrowed

Total

Eurobond

27

(1) Based on remaining maturities(2) Excluding funds from domestic banks and repo / money market.

COMPOSITION OF ASSETS & LIABILITIES (2016 Q3, TL bn)

MATURITY PROFILE OF NON-DEPOSIT FX FUNDING(2) (2016 YE)

COMPOSITION OF NON-DEPOSIT FX FUNDING (2016 Q3)

Amount (USD mn)

Total Deposits Growth

TL Deposits Growth

FX Deposits (USD) Growth

STRONG CAPITAL BASE

2015

Net Income

Dividend Distribution

2016 9M

Growth in RWAs(1)

Other (2)

BASEL III BUFFERS

2017 20182016% 2019

Capital Conservation Buffer

max

.

2.5

2.5

1.875

1.875

0.625 1.25

1.25

CAR (Bank-only) 13.0011.758.64 10.50

SIFI Buffer (4) - Group 3 21.50.5 1

Min. Legal Requirement for CAR 888 8

15.0013.259.14 11.50CAR (Consolidated)

0.012(3)Counter Cyclical Buffer

15.65%

15.80%

1.33%

-0.33%

-0.58%

-0.27%

CAPITAL ADEQUACY RATIO

28

CAR >14%

2017

(1) TL depreciation impact is -22 bps.(2) ”Other” item includes the impacts of change in M-t-M differences (+19 bps), decrease in Tier II capital due to amortization (-26 bps), exclusion of free provisions from regulatory capital calculation (-32 bps), and other effects (+12 bps).(3) As of September 2016(4) Taken into consideration only on a consolidated basis

REVENUE GROWTH

2015 9M

2015 9M

2015 9M

2015 9M

2016 9M

2016 9M

2016 9M

2016 9M

6,522

1,726

8,846

555

19.7%

18.5%

21.0%

23.0%

7,806

2,046

10,705

682

NET FEES & COMMISSIONS

DIVIDEND INCOME

TOTAL OPERATING INCOME

29

NET INTEREST INCOME

>15% increase in NFC

1% increase in dividend income

17% increase in total operating income

18% increase in NII

Flat NIM: 4.0%-4.2%

2017

IMPROVING EFFICIENCY

2015 9M 2016 9M 2017

52.4%

-3.9 ppt

46.2%43.7% <44%

47.6% 20.7

17.1 17.1 17.3 17.6

18.0

18.4

19.5

18.4

17.9

18.3

18.1

2011 2012 2013 2014 2015 2016 Q3

İşbank Peer Average

EMPLOYEES PER BRANCH

30

COST TO INCOME(1)

Reported Adjusted(2)

Positive JawsFlat # of branches OPEX growth: CPI + 1-2%

2017

(1) Based on trailing four quarters’ data(2) Adjusted for non-recurring and other items

IMPROVING PROFITABILITY RATIOS

2015 20152016 Q3(2) 2016 Q3(2)2017 2017

1.2% 12.1%

1.5% 15.4%1.6% - 1.7% 16% - 17%

RoATE(1)RoAA

31(1) Tangible Equity (TE) is calculated by the deduction of M-t-M valuation differences regarding AFS portfolio, listed participations and real estate portfolio from shareholders’ equity.(2) Calculations are based on trailing four quarters’ data.

2017 EXPECTATIONS - ISBANK

2015

Loan Growth 12% -13%

14% - 15%

<3.0%

125 -130 bps

>14%

4.0% – 4.2%

3.7% – 3.9%

>15%

CPI + 1-2%

1.6% - 1.7%

16% - 17%

6.5%(1)

8.0%(1)

2.6%

132 bps

15.8%

4.18%

3.81%

18.5%

3.4%

1.5%(4)

15.4%(4)

14.0%

15.2%

2.0%

114 bps

15.6%

3.80%

3.39%

19.2%

11.1%

1.2%

12.1%

Deposit Growth

NPL Ratio

Capital Adequacy Ratio

Net Fees & Commissions Growth

Return on Average Assets

Return on Average Tangible Equity

OPEX Growth

Net Interest Margin(3)

Net Interest Margin (Swap adjusted)(3)

Gross Cost of Risk(2)

2016 9M 2017 Expectations*

(*) Growth rate expectations are given compared to 2016YE.(1) Year-to-date(2) (Specific Loan Loss Provisions + General Loan Loss Provisions ) / Average Performing Loans(3) Based on MIS data(4) Calculations are based on trailing four quarters’ data.

32

KEY TAKEAWAYS

33

Improving profitability

Robust fee income generation, supporting bottom-line with minimum capital consumption

Further improving efficiency

Asset quality sustained and will continue to be the main pillar of the strategy – lowest NPL among peers

Strong capital base maintained

Focus on digitalisation and transformation – Number of mobile customers exceeded 3.6 million.