© 2012 Promontory Financial Group, LLC. All rights reserved. Washington Atlanta New York San Francisco Dubai London Milan Paris Singapore Sydney Tokyo Toronto The Outlook for Regional Banking between Turkey and the Middle East Walıd R Alameddıne CEO Mıddle East and Turkey Promontory Fınancıal Group June 30, 2012 Istanbul, Turkey

© 2012 Promontory Financial Group, LLC. All rights reserved. 2 CONFIDENTIAL Table of Contents The Outlook for Regional Banking between Turkey and the Middle East Current State 1. Middle East Banks in Turkey 2. Turkish Banks in the Middle East 3. Current State Summary Outlook / Future 4. Outlook/ Istanbul as a Financial Center 5. Regional Players’ Role 6. Regional Players 7. Outlook / Conclusion

© 2012 Promontory Financial Group, LLC. All rights reserved. 3 CONFIDENTIAL Middle East Banks in Turkey 1.Albaraka Türk (Participation Bank) 2.Arap Türk Bankası 3.Eurobank Tekfen (2012) 4.Kuveyt Türk (Partipation Bank) 5.Odea Bank (2012) 6.Taib Yatırım Bank 7.Turkland Bank 8.Türkiye Finans (Participation Bank) Total Asset Size USD 24,566 Mn Total SH Equity USD 3,154 Mn % of Total Turkish Banking Market Total Assets 3.82% Total SH Equity 4.12%

© 2012 Promontory Financial Group, LLC. All rights reserved. 4 CONFIDENTIAL Turkish Banks in the Middle East AkbankIraq IsIraq, Bahrain ZiraatSaudi Arabia, Iraq (2) FinansBahrain Yapi ve KrediBahrain

© 2012 Promontory Financial Group, LLC. All rights reserved. 5 CONFIDENTIAL Middle East Banks in Turkey have focused on the local Turkish banking business in Turkey itself. Their regional business reportedly constitutes a small part of their business. The “Regional Promise” of these banks needs to be fulfilled. The main reason for the focus of Arab Banks on local / domestic business in Turkey, is that Turkey remains underbanked. This is reflected by the fact Turkish banking assets ratio to GDP is still at around one (while the norm is around 1.5 times). Turkish Banks’ presence in the Middle East is limited, and very small. Current State / Summary

© 2012 Promontory Financial Group, LLC. All rights reserved. 6 CONFIDENTIAL Turkey has ambitious plans for Istanbul to become an International Financial Center. The Vision calls for Istanbul to be first a “Regional Financial Center”, then a “Global Financial Center”. A Regional Financial Center Requires: - Infrastructure. Physical. Systems: legal, supervisory. Human resources. Coordination - Regional Players Outlook / Istanbul as an International Financial Center

© 2012 Promontory Financial Group, LLC. All rights reserved. 7 CONFIDENTIAL Middle East Banks in Turkey need to become more Regional. They need to do more regional business. This business can be investment, trade, contracting, etc. A regional bank is one that has an important part of the business of its branch (or subsidiary in Turkey) in intermediating and/or facilitating regional business. Turkey’s Banking Supervision: The BRSA/BDDK has issued its first new banking license in more than 12 years to a regional bank, Bank Audi, to have a subsidiary in Turkey (Odea Bank). This BDDK’s move is one of the most important in promoting Istanbul as a Regional, and International Financial Center. Turkey needs to have some of its own banks become more regional. This is notwithstanding that the domestic market for these banks would provide higher returns in the short run. Regional Players’ Role

© 2012 Promontory Financial Group, LLC. All rights reserved. 8 CONFIDENTIAL Bank Audi/Odea has clearly stated it wants to play the regional role, and it does have the capability to do that. Burgan Bank of Kuwait has bought Eurobank-Tekfen in Burgan has stated that it wants to have a regional role. This is notwithstanding that Eurobank-Tekfen itself has been only focused on Turkey. Other Regional Banks, including QNB of Qatar, and al-Mashreq of the UAE, have publicly stated that they want to enter the Turkish Banking sector through acquisition. Regional Players

© 2012 Promontory Financial Group, LLC. All rights reserved. 9 CONFIDENTIAL Turkey’s banking system still has very significant growth potential. Those banks who capture a market share can capture growth potential as well. The regional banking business between Turkey and the MENA region also has significant potential. Those banks who take the lead in assuming a regional role will capture this business. Outlook / Conclusion