SME Banking - Garanti

SME Banking
Garanti acts as an agent
that carries enterprises
into the future with
its products tailored for
individual sectors and
regions, and makes
a difference with
its dynamic structure
designed specifically
for SMEs.
#1
Choice in
KOSGEB applications
60%
Growth in TL
General Purpose Loans
Standing by the SMEs for 14 years for all kinds
of financial and consultancy needs, Garanti
Bank continues to extend affordable support
with its broad product range. The first Turkish
bank to arrange its organizational structure on
the basis of head office, regional offices and
branches specifically for the SMEs, Garanti
continued to be the Bank of SMEs with
pioneering activities in 2011.
Garanti Bank defines SME customers as
companies with a turnover of up to TL 10
million and their shareholders.
2011 Activities
In 2011, which proved to be an active year for
the SMEs, Garanti SME Banking augmented
its share in the sector and worked to fulfill
diverse segment-specific needs of medium
and small sized enterprises. In this frame, the
Bank had a fruitful year and acquired new
customers in all segments.
Various events were organized to cater to
training and advisory needs of SMEs, as well
as their financial requirements.
New additions were made to conferences,
gatherings and dialogue sessions organized
every year. Below are highlights of the
organizations that brought together the
industrialists, managers and women
entrepreneurs in Anatolia with experts:
KOBILGI (SME Informative) Meetings
Launched during 2011, KOBILGI SME
Informative Meetings refer to a series of
symposia enriched with case studies and
practices, where experts give information
on developments in various topics including
legislation, marketing and sales. Held in Istanbul,
Bursa and Ankara, and centered on the New
Turkish Commercial Code, KOBILGI meetings
will be carried on with a different selection of
topics and cities in Anatolia in 2012.
Facebook Chats with SMEs
Live broadcasts under the name Facebook
Chats with SMEs have been initiated on
Garanti’s Facebook page, the world’s most
liked financial institution account. The first of the
series was themed the New Aspects of the New
Turkish Commercial Code, while the second
focused on Business Angels, and the last on
General Economy. With previous broadcasts
made available for viewing from Garanti
Facebook account, live webcasts will continue in
2012 with different topics and guests.
Anatolian Meetings
Organized since 2002, Anatolian Meetings
aim to bring together the industrialists and
managers in Anatolia with Turkey’s leading
experts and join forces to develop regional
solutions. To date, the Bank has met more
than 25,000 SME representatives in total in 74
gatherings in 55 provinces. Anatolian Meetings
will be carried on in 2012.
Women Entrepreneurs Meetings
In an effort to make the knowledge and
experience in management, marketing and
technology available to women entrepreneurs
in Anatolia, Women Entrepreneurs Meetings
were initiated in 2008. Held in cooperation with
KAGİDER (Women Entrepreneurs Association
of Turkey) in 15 cities including Girne in Cyprus
until now, the gatherings were attended by
over 2,500 women entrepreneurs.
2011 in Figures
• Up 26% year-on, the banking volume of
SME banking reached TL 28.5 billion.
• Garanti further expanded its SME customer
base in 2011 and now serves 1.4 million
SME banking customers.
• Garanti achieved significant growth, and
realized 5% expansion in FC deposits and
20% in TL deposits year-on-year, reaching
TL 13 billion in total deposits.
• Garanti extended support with a total worth
of TL 6.7 billion to SMEs. According to
the official SME definition of the banking
industry, Garanti got 11% market share in TL
cash loans.
• Garanti outperform the overall sector’s
growth of 28% with 32% increase attained
in TL cash loans, according to the official
SME definition of the banking industry.
• Through the Women Entrepreneurs Support
Package, Garanti provided new loan
support in the amount of TL 83.9 million
to more than 2,400 women entrepreneurs.
15,000 loans disbursed to date to women
42 GARANTI BANK 2011 ANNUAL REPORT

entrepreneurs by Garanti amount to TL
433 million. Organized for supporting and
encouraging woman entrepreneurship, the
Woman Entrepreneur of Turkey Competition
reached 5,600 participants in its fifth year.
• Continuing to finance agricultural
activities, Garanti closely monitored the
developments in the sector and designed
two new loan products to be used within
the frame of licensed warehousing and
IPARD (Instrument for Pre-Accession
Assistance for Rural Development) grant
program. The Bank took into consideration
the varying cash flow in the agricultural
industry and targeted to provide funding
to agricultural enterprises by developing
models for financing suppliers with the
guarantee of main companies. Also
ongoing were collaborations with various
farmer associations for the automation of
agricultural cash flow. The funds provided
under the prefinancing loan for farmers
with maturities aligned with harvest times
and medium/long-term investment loans
amounted to TL 700 million. In Turkish
Grain Board loans, Garanti disbursed TL 82
million, breaking the record of the past six
years, and remained the leader among all
banks.
• Garanti acted as an intermediary in the
channeling of overseas funds created by
the European Bank for Reconstruction and
Development (EBRD) Council of Europe
Development Bank (CEB) to the SMEs.
The funding provided under the Turseff
program set up by the EBRD for enterprises’
investments in energy efficiency was worth
USD 60 million. The CEB fund of EUR 35
million allocated for cluster and industrial
sites, and for lodging establishments was
made available to the SMEs within the frame
of the agreement with the Development
Bank of Turkey.
• As a result of effective risk monitoring, the
NPL ratio was way below than that of the
sector and stood at 2.92% as at end-
December.
Under the “Growth Support Linked to Scale”
program developed by KOSGEB (Small
and Medium Sized Industry Development
Organization) in order to extend financial
support to SMEs, Garanti provided loan
support worth TL 931 million to 23,000
customers, and was the most frequently
preferred bank with 34% share in KOSGEB
applications. The Bank provided financing
in the amount of USD 204 million to 1,150
customers under the “SME Export Finance
Support” program. Garanti ranked first in loan
disbursements among 17 banks that acted
as an intermediary in both programs. More
than 15,000 customers received funds worth
TL 466.5 million in total within the scope of
KOSGEB Bridge Loan Facilities with grace
periods. Including these loans, the Bank
realized 77% increase in total TL installment
loans. Guaranteed Payment product
introduced during the reporting period provides
bank protection for credit sales in the trade
between SMEs. While buyers easily effect their
payments on the due date, sellers enjoy the
guarantee that their receivables will be paid on
the collection date.
Making the SMEs feel that it stands by them
at all times with all these activities, products
and solutions, Garanti Bank further reinforces
its strong position drawing on the strength
mustered from the positive customer feedback:
“I am in the tourism industry and I own a
medium-sized hotel with 200 beds in the
Antalya region. There are occasional investment
needs for my 12-year establishment. Last year,
I had planned on an investment for the heating
system, which is essential for our facility.
During my contacts with banks for borrowing
money under the incentive certificate,
Garanti Bank mentioned Turseff Loans. We
renewed our hot water system making use
of solar panels. We also fulfilled part of our
need with power generation. Thanks to the
loan with an affordable interest rate Garanti
Bank suggested, we were able to realize our
investment at a lower financing cost.”
“I own an enterprise operating in the OSTİM
cluster site. I had never needed to get a loan
before. When Garanti Bank representatives
visited me in my office, I told them about the
plant investment I would start in February and
my need to purchase machinery. They told
me about the low-interest rate and long-term
advantages of the SUFI loan facility extended
by the Council of Europe Development Bank.
They took action quickly and provided the loan
I needed. I purchased the machinery at low
costs and increased the capacity at the plant. I
can say that currently Garanti is the only bank
I work with.”
Below are some results from the market
research conducted by Ipsos KMG research
company in 2011 with 613 SMEs in 12
provinces across Turkey:
• Garanti Bank is the first bank recalled in
SME Banking,
• Garanti Bank’s image: “innovative”, “stands
by us through tough times”, “understands
our needs”, and “the Bank of SMEs”,
• Garanti is preferred for the following reasons:
“fast transactions”, “reliable bank” image,
“quality/good service” and “satisfaction”,
• Companies having Garanti as their
primary banking partner prefer Garanti
Bank because of its “widespread branch/
ATM network”, “diversity of products
and services”, “accurate and errorfree
transactions”, “quick finalization of
demands”, and “understanding, resolution
of problems.”
Projections for 2012
In 2012, Garanti will continue to bolster the
economy through financing to SMEs, the
driving force of the Turkish economy. The
Bank will take steps to render its profitable and
healthy growth sustainable with its open and
powerful communication understanding, and
customer-centric approach that is always given
the foreground.
Priority targets set for 2012 are presented
below:
• Introduce new products and services that
facilitate, and provide protection for the
commercial lives of SMEs,
• Improve information and advisory services
so as to provide SMEs with easier access to
information,
• Design solutions for the needs of SMEs
in different departments by establishing
powerful brand partnerships and
collaborations with regional/sectoral
institutions,
• Offer different financing alternatives to
entrepreneurs requiring fast and simple
access to financial sources,
• Take on efforts geared towards advancing
SMEs specific to provinces that do not
receive adequate financing support from
banks,
• Provide sector- and region-specific financial
solutions through projects that will be coexecuted
with institutions such as clusters,
industrial sites and export unions.
GARANTI BANK 2011 ANNUAL REPORT 43