Akbank: Founded in 1948 by Sabanci Family, the third largest private bank as of YE2008 in terms of total assets with a market share of 10.5% in loans. 879 branches with a wide geographical coverage and around 15,000 staff. Having asset size USD 65 billion, ROAE of 22% and CAR of 20.6% as of 3Q09. Long term FX borrowing rating of B1/BB by Moody’s and Fitch, respectively (vs. Turkey foreign currency deposit ceiling of B1/BB). Shares are listed in Istanbul Stock Exchange (1990) and ADRs are traded since 1998. CitiGroup acquired 20% equity stake on January 2007. Current shareholding structure is as follows: Shareholder                                   Ownership% Sabanci Holding and its subs. 44.46 Sabanci family members 6.92 Citibank Overseas Inv.Corp. 20.00 Free Float 28.62 Parent: Sabanci Group, one of the leading conglomerates in Turkey, is involved in a wide variety of industries including energy, finance, cement, tire reinforcement, automotive, food and retail, textiles and chemicals employing around 55,000 people. Sabanci Holding’s turnover in 2008 was 2.3% of Turkey’s GDP. Sabanci Group has controlling interests in 12 companies listed on the Istanbul Stock Exchange which make up 14% of the ISE market capitalization. With a 62.6% shareholding, Sabanci Family is the major shareholder of the group. The remaining 37.4% of the shares are publicly available as free float.

The Project consists of a senior loan of up to USD75 million to the Bank from IFC’s own account.

75.0 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	75.0
Equity

* These investment figures are indicative

Akbank is headquartered in Istanbul. It has a wide geographical coverage throughout Turkey with its 879 branches. Investments can be made all across the country.

The project aims to increase access to finance for the underserved segments of the society in the areas outside the three major urban areas. Measurable indicators will include number and volume of SME loans disbursed to SME entrepreneurs in these regions.

Improving Maturity Mismatch: Akbank's balance sheet is largely funded (around 55% of total assets) by short-term deposits having average maturity less than 45 days. IFC's long term funding along with Akbank’s efforts of obtaining funding via other sources will help to provide matched funding to the SMEs. Increased access to finance: IFC will require that at least 75% of IFC proceeds would be utilized in the regions outside the three major urban centers which would benefit the underserved segments in the less urbanized areas of Turkey. With IFC’s funding, Akbank will be able to extend its support in providing much needed long-term financing to the SME segment, a segment mostly underserved in Turkey. Further, if needed, IFC is able to provide this loan in local currency which would address the foreign exchange mismatch problem at the sub borrower level.

As a former IFC client, it is expected that Akbank has some experience with E&S risk management. IFC''s review will focus on the extent to which Akbank''s systems and procedures need to to be updated. If needed, IFC will recommend enhancements to Akbank''s systems and capacity. IFC will also review the Bank''s labor practices in the context of IFC Performance Standard 2: Labor and Working Conditions.