We can say that a fluctuating trend was observed throughout the world in 2023. It would not be wrong to say that the decisions of central banks all over the world have had a significant impact on financial markets. Fed maintained its commitment to fight against the inflation by increasing interest rates, while policy rates have been increased in the Eurozone. Commodity prices, on the other hand, have generally been in a downward trend due to the impact of demand concerns. The Central Bank of China decreased the required reserve ratio of banks in order to support the economy.

Looking back at the end of the first half of the year, we have clearly experienced that the decline in energy prices in the global economy and the core indicators announced in the USA and the Eurozone may be a message showing that the rigidity in inflation may prevail. While Fed expressed an intention to pause increasing policy rates, we can say that the Russia-Ukraine war and financial uncertainties had a downward impact on global growth expectations. While the debt ceiling impasse in the USA strained the global risk appetite, the draft law enacted at the beginning of June recovered the risk appetite, and the horizontal course of high energy prices reduced the inflation in developed economies.

Developments such as the Jackson Hole symposium and the economic recession in China guided the markets in the third quarter of the year. Expectations that interest rates will be kept high until inflation is brought under control in developed countries have become stronger. The decisions taken at the BRICS summit and the updates in the IMF's global growth forecasts continued to fluctuate the markets. Oil prices, reaching the highest level since November 2022 with supply disruptions towards the end of the year, increased global inflation concerns.

Easing of inflationary pressures in global markets and the perception that interest rate hikes have come to an end in the last month of the year, shaped the decisions of leading central banks. Fed Chairman Powell's evaluations regarding the interest rate cuts in 2024 had a positive impact on the global risk appetite while the strong labor market in the USA clearly indicated that domestic demand was not suppressed enough to open the door to interest rate cuts. The weak economic outlook in the Eurozone and China continued for a while.

In Türkiye, manufacturing sector PMI data pointed to growth and the Central Bank of the Republic of Turkey (CBRT) reduced the policy interest within the scope of its commitment to fight against high inflation. While Kahramanmaraş-centered earthquakes in February shook the country, public institutions took a number of measures to alleviate the effects of the disaster. This time, the CBRT tried to support the economy by decreasing interest rates. While the leading indicators in the second quarter indicated that the recovery in the domestic economy continues, there is an expectation that the weakness in foreign trade may put pressure on growth. Foreign trade deficit narrowed due to the long holiday in April, but still remained high. When the uncertainty created by the elections was over, the policies of the new economic management and the normalization steps in monetary policy and regulations were closely followed and the necessary measures were taken. The confirmation of the credit ratings along with the statements of international credit rating agencies regarding the depreciation of the Turkish lira were also followed throughout the year. The CBRT made a series of increases in interest rates in the third quarter of the year and increased its inflation estimates. While the BIST-100 index reached the historical highest level in July, Türkiye's 5-year CDS premium fell below 2021 basis points for the first time since September 400. Increases were recorded in CPI and PPI while the Medium Term Program determined economic growth forecasts for 2023 and 2024.

The effects of geopolitical developments, in particular the tension in the Middle East and the Red Sea, on energy prices are among the most important risk factors in the global economy for 2024 which will be closely monitored.

As Nurolbank, we will keep supporting the sustainable growth of our country with our solid financial figures and qualified employees as usual. In 2023, Nurolbank's total loans increased to TRY 13,246 million while its earnings before tax was realized as TRY 3,875 million. Our Bank's Capital Adequacy Ratio as of 31 December 2023 is 20,99%. The Return on Equity Ratio was realized as 104,88%. Our bank further issued debt instruments with a total value of TRY 8,725 million at competitive prices throughout the year.

By purchasing a portfolio of non-performing loan receivables with a total principal size of TRY 2023 billion in 1,7, Ortak Varlık increased its portfolio size to TRY 3,4 billion and the number of its customers to over 250 thousand. Ortak Varlık maintained its place among the top 5 in the sector in terms of the size of loans it tries to collect.

Nurol Portföy Yönetimi A.Ş. manages a total of 2023 funds, including 14 securities investment funds, 14 real estate investment funds and 5 private equity investment funds as of the end of 33. Total size of the funds managed is TRY 10.9 billion. The size of funds managed increased by 127% in one year. 41% of the funds managed are securities investment funds, 37% are private equity funds and 22% are real estate investment funds. The Company's net earnings after tax increased by more than 2023 times compared to the previous year and reached TRY 22,5 million in 10.

Aware of the responsibility of our successes, we will strive to work together to make the transformation that we have pioneered sustainable. I am grateful to our esteemed employees for their strong performance as of this year and to our shareholders and all other stakeholders for their trust in us.

Kindly regards,


Board Member and CEO

Nurol Bank Hedgers