Koç Financial Services, a 50/50 joint venture between Koç Holding and UniCredit Group, and Turkey's first consumer finance company Koç Finans, operate under the umbrella of the Finance Group of Koç Holding. Koç Financial Services is the main shareholder of Yapı Kredi, established in 1944 as Turkey's first nationwide privately owned bank, with its financial subsidiaries and UniCredit Menkul Değerler A.Ş. , that joined the Group on August 15, 2008.

Driven by a customer-centric strategy, Yapı Kredi focuses on understanding the needs and expectations of its customers while seeking to create the best customer experience. Yapı Kredi serves six million active customers and is the fourth largest private bank in Turkey with total consolidated assets of TL 74 billion as of the end of 1Q10.

Yapı Kredi maintains leading positions in key segments and products supported by its strong franchise, large network and leading brand.

Yapı Kredi maintains leading positions in key segments and products supported by its strong franchise, large network and leading brand. The Bank is the leader in credit cards (20.5% market share in outstanding and 20.7% market share in issuing volume). In addition, Yapı Kredi holds leading positions in factoring (#1 with 29.9% market share), leasing (#1 with 17.9% market share), asset management (#2 wtih 18% market share), brokerage services (#2 wtih 5.6% market share), private pension funds (#3 with 15.1% market share), and life and non-life insurance (#5 with 4.5% and #8 with 6.1% market shares, respectively). Yapı Kredi, with 838 branches located in more than 70 cities, has the fourth largest branch network in the Turkish banking sector. High quality products and services are also provided to customers through alternative delivery channels including rich content telephone, internet and mobile banking as well as 2.351 ATMs, the fifth largest network in Turkey. In addition to Yapı Kredi's wide ATM network, customers are also offered access to more than 15.000 ATMs in 22 European countries through an ATM sharing agreement with UniCredit.

Macroeconomic and Sectoral Developments in 1Q10
Moving out of the global crisis environment, the year 2010 has started with positive expectations throughout the world on the back of completion of 2009 with recovery signals. However, as the crisis has been deepening in the European Union economies and reaching serious levels particularly in Greek, Spanish, Irish and Portuguese economies, concerns regarding the crisis environment continue throughout the world. Sustainable recovery from the crisis seems to take a longer period of time considering the high amount of public debts in many economies, continued problems in the credit markets and high unemployment rates.

Following 2009, a year with slowdown in loan and deposit volume growth and increasing amount of non-performing loans (NPL) due to macroeconomic deterioration and lower demand, the first quarter of 2010 has been positive for the banking sector. Total loans in the sector grew by 6% ytd driven by improved macroeconomic conditions, pent-up demand and increasing lending appetite by banks. Loan growth in the sector was balanced in terms of currency. TL and FC loan growth were driven by retail/individual, SME and corporate loans respectively. Also, sector NPL ratio decreased by 33 bps ytd to 4.9% driven by decreasing new NPL inflows as a result of macroeconomic recovery, restructuring programmes, increasing collections, NPL portfolio sales and loan volume pick up. Meanwhile, the net interest margin which increased during 2009 due to Central Bank’s continued rate cuts was under pressure in the first quarter of 2010 due to low interest rate environment and increasing competition.