Dear Stakeholders,

Before presenting the annual report, financial statements and profit distribution proposal for your review and approval, which provide the results for 2021 during which İş Leasing displayed a successful performance, and which have been prepared in accordance with the Capital Market Law and applicable legislation; I would like to give an overview of the global and national economy and make a brief assessment of the leasing sector and the position of İş Leasing.

The pandemic remained as the number 1 item on the economy agenda.

During 2021, vaccination campaigns accelerated around the globe, normalization and growth tendency was captured in the first half of the year, and economic revival lost pace after the virus re-imposed itself with new variants and periodic measures and restrictions were introduced in connection therewith. As inadequate supply and procurement issues arose in view of the rapidly revived demand during normalization because of operational shutdowns and postponed investments during the lockdowns, global raw material and commodity prices showed record rises. While the problems in the supply chain led to supply-demand mismatches, an inflationary spiral outstretching from emerging countries to developed economies loomed as a new peril threatening the global economy.

Liquidity surplus in the market and strengthened economic activity that resulted from expansionary monetary policies implemented from the onset of the pandemic by many central banks led by those of advanced economies have been important factors that fueled inflationist effects. In the last quarter of the year, major central banks concluded that the inflationist tendency is permanent and thus started restricting their asset purchases and accelerating monetary policy tightening. While the Fed and the ECB, which kept their interest rates fixed, announced they would be terminating their bond buying programs, the Fed is anticipated to hike rates in 2022. In the period ahead, gradual and controlled exit from loose monetary policies in developed countries will presumably negatively affect capital flows to emerging economies.

While maintaining its growth rate estimation of 5.9% for 2021 in the World Economic Outlook Update released in January 2022, the IMF noted that global economy presented a weaker-than-projected outlook at the onset of 2022 and revised its growth projection for the whole year downwards from 4.9% to 4.4%. Estimated at 5% for developed countries in 2021, growth forecast was 6.5% for developing economies. The report projected Turkey’s growth as 9% for 2021 and 3.3% for 2022.

On another note, 2021 has been a year during which the impacts of the climate crisis deepened and were manifested with fire and flood disasters. In a setting overshadowed by these developments, the Turkish Ministry of Trade published the Green Deal Action Plan of Turkey that covered nine headings in July 2021. On November 10th, Turkey has also become a party to the Paris Agreement that targets to limit global temperature rise to 1.5 degrees, and pledged to achieve a net zero target by 2053 with respect to reducing its GHG emissions.

In the medium- and long-term, deteriorated supply chain, increased energy prices, rising inflationist tendencies and the impacts of the climate crisis that are progressively becoming more concrete will potentially arise as factors curbing growth.

The Turkish economy preserved its growth momentum also in 2021 and registered 11% growth benefiting also from the base effect of the previous year.

The Turkish economy maintains its growth tendency.

The Turkish economy preserved its growth momentum also in 2021 and registered 11% growth benefiting also from the base effect of the previous year. Private consumption and record exports that played an important part in the rapid growth with the contribution of the low base have been the drivers of the growth performance. Looking at the last quarter, the fastest growth occurred in domestic consumption.

As the depreciation of the Turkish currency accelerated particularly in the last quarter of the year, the CPI was high throughout 2021 when the high levels in exchange rates and global commodity and energy prices added to inflationist pressures on the cost side, and was recorded as 36.08% at year-end.

Although the solid exports performance displayed throughout 2021 and the recovery in tourism and transportation revenues brought along betterment in the current accounts balance, the uptrend in commodity and energy prices continues to pose an upside risk on the current deficit.

İş Leasing is determined to upgrade its service quality and competitive superiorities on the back of its strong risk perception and management, coupled with its innovative transformation and data-driven agile decision-making processes in the digitalization area.

Our target: sustainable service and success

With the normalization that gathered speed and economic activity that revitalized in 2021, the leasing sector also revived, and the business volume increased by 21% to USD 4 billion.

İş Leasing strengthened its contribution to the economy by extending solid support to the SMEs and the real sector in 2021 when it converted the challenging pandemic conditions experienced in the previous year into opportunity with its strong prediction capabilities. As our company increases its support to its customers on the back of its robust equity and diversified funding sources, it preserves its asset quality owing to effective credit risk management.

Sustainability and digitalization make the pivots of our growth roadmap. As İş Leasing acts with a strategy focused on financing renewable energy investments, it has also made a mark with its financing solutions for solar power as well.

In the coming year, adaptation to rapid change and moving forward with the right and farsighted decisions in the face of uncertainties will be key. İş Leasing is determined to upgrade its service quality and competitive superiorities on the back of its strong risk perception and management, coupled with its innovative transformation and data-driven agile decision-making processes in the digitalization area.

On behalf of the Board of Directors and myself, I would like to thank the İş Leasing family and all our stakeholders with whom we wish to share our achievements in a healthy and livable future.

Sincerely,

Murat Bilgiç

Chairman of the Board of Directors