This article first appeared on GuruFocus .
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Net Income:Increased by 39% year-on-year to $19,143 million.
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Revenue:Grew by 42% year-on-year to $71,952 million.
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Net Interest Income (NII):Expanded by 87% year-on-year.
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Net Fee Income:Increased by 35% year-on-year.
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Return on Assets (ROA):25.3%.
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Return on Equity (ROE):2.2%.
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Non-Performing Loan (NPL) Market Share:Declined by 360 basis points over the past year.
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Reserve Coverage for Stage 2 and Stage 3 Loans:27.6%.
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Net Interest Margin (NIM):3.3%.
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Swap-Adjusted NIM:Improved by 20 basis points quarter-on-quarter.
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Fee-to-OpEx Ratio:Temporarily declined to below 90%.
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Cost-to-Income Ratio:Around 51%.
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Total Capital Ratio:16.1%.
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Tier 1 Capital Ratio:13.1%.
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Core Equity Tier 1 Ratio:11%.
Release Date: April 28, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Akbank TAS ( AKBTY ) reported a strong start to the year with a return on assets (ROA) of 25.3% and a return on equity (ROE) of 2.2%, aligning with their quarterly projections.
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The bank achieved robust revenue growth, up 42% year-on-year, driven by dynamic asset-liability management and resilient fee income generation.
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Net interest income (NII) expanded by 87% year-on-year, supported by balance sheet discipline and funding cost optimization.
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Akbank TAS ( AKBTY ) successfully completed Turkey's first sub-8% issuance and renewed its syndicated loan with extended maturities at unchanged pricing, reflecting strong international investor confidence.
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The bank's asset quality remains resilient, with a decline in non-performing loan (NPL) market share by 360 basis points over the past year and a solid reserve coverage for Stage two plus Stage three loans at 27.6%.
Negative Points
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Geopolitical tensions and energy price volatility continue to pose challenges, potentially delaying the expected easing in financial conditions.
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A prolonged high-rate environment may weigh on margins and asset quality in the near term.
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The bank's net interest margin (NIM) improvement in the second quarter may be challenging due to the current funding environment.
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There is a risk of further pressure on asset quality due to moderate GDP growth and a higher-for-longer rate environment.
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Capital ratios are under pressure, with core Tier 1 capital down to 11%, partly due to temporary impacts such as operational risk adjustments and dividend payments.
Q & A Highlights
Q: Given the increasing risk of lower GDP growth and a higher for longer rate environment, do you see any risks to your asset quality outlook or cost of risk guidance? Are there any early signs of stress on the SME side? A: TArker Tunali, Chief Financial Officer: We are proactively managing our lending policies and collateralization strategies to mitigate potential risks. Currently, we do not see any risk to our full-year guidance. The NPL inflows are mainly from the retail segment, including small SMEs, but this is manageable with our dynamic policy adjustments.
Q: Should we expect NIM contraction in the second quarter? A: TArker Tunali, Chief Financial Officer: We expect NIM expansion to be delayed into the third quarter. Currently, NIM is evolving similarly to the first quarter, with no contraction but also no further improvement. We anticipate some improvement in the second half of the year, assuming the Central Bank resumes rate cuts.
Q: What changes have you made to your banking book to mitigate interest rate risks? A: TArker Tunali, Chief Financial Officer: We have adopted a cautious and balanced approach, focusing on short-term pricing and maintaining a balanced duration management strategy. We are not extending the maturity profile significantly at this time.
Q: Your capital ratio is under pressure. When do you expect it to stabilize and improve? A: TArker Tunali, Chief Financial Officer: Temporary impacts like operational risk adjustments and dividend payments affected the capital adequacy ratios. We expect gradual improvements as these factors will not repeat in upcoming quarters. Half of the mark-to-market losses have already reversed.
Q: What are your updated macro assumptions, and have they changed? A: TArker Tunali, Chief Financial Officer: We now expect year-end inflation to be around 28%, with a policy rate of 34%. GDP growth is expected to moderate to 3%. These adjustments reflect recent developments and our updated economic outlook.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
