Bond Türkiye ?? Bankas? 5.5% ( XS0982644774 ) in USD

Issuer Türkiye ?? Bankas?
Market price 100 %  ⇌ 
Country  Turkey
ISIN code  XS0982644774 ( in USD )
Interest rate 5.5% per year ( payment 2 times a year)
Maturity 21/04/2019 - Bond has expired



Prospectus brochure of the bond Turkiye Is Bankasi XS0982644774 in USD 5.5%, expired


Minimal amount 200 000 USD
Total amount 500 000 000 USD
Detailed description Türkiye ?? Bankas? is a major Turkish multinational banking and financial services corporation, the oldest and largest privately owned bank in Turkey.

The Bond issued by Türkiye ?? Bankas? ( Turkey ) , in USD, with the ISIN code XS0982644774, pays a coupon of 5.5% per year.
The coupons are paid 2 times per year and the Bond maturity is 21/04/2019







Issue of U.S.$500,000,000 5.50% Notes due 2019
under its U.S.$1,750,000,000 Global Medium Term Note Program
Issue price: 99.467%
The U.S.$500,000,000 5.50% Notes due 2019 (the "Notes
431112 (the "Bank" or the "Issuer") under its U.S.$1,750,000,000 Global Medium Term Note Program (the "Program").
The Notes have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the "Securities Act") or any
U.S. State securities laws and are being offered: (a) for sale to qualified institutional buyers (each a "QIB") as defined in, and in
reliance upon, Rule 144A under the Securities Act ("Rule 144A") and (b) for sale in offshore transactions to persons who are not US
persons in reliance upon Regulation S under the Securities Act ("Regulation S"). For a description of certain restrictions on sale and
transfer of investments in the Notes, see "Plan of Distribution" herein and "Subscription and Sale and Transfer and Selling
Restrictions" in the Base Prospectus (as defined under "Documents Incorporated by Reference" below).
AN INVESTMENT IN THE NOTES INVOLVES CERTAIN RISKS. SEE "RISK FACTORS" HEREIN.
The Notes will bear interest from (and including) October 21, 2013 (the "Issue Date") to (but excluding) April 21, 2019 (the
"Maturity Date") at a fixed rate of 5.50% per annum. Interest will be payable in arrear in equal installments on the 21st day of each
April and October in each year (each an "Interest Payment Date") up to (and including) the Maturity Date; provided that if any such
date is not a Payment Day (as defined in Condition 7.6), then such payment will be made on the next Payment Day but without any
further interest or other payment being made in respect of such delay. Principal of the Notes is scheduled to be repaid on the
Maturity Date, but may be repaid earlier under certain circumstances described herein and in the Base Prospectus. For a more
detailed description of the Notes, see "Terms and Conditions of the Notes" herein.
This Prospectus has been approved by the Central Bank of Ireland, as competent authority under Directive 2003/71/EC as amended
(including the amendments made by Directive 2010/73/EU) (the "Prospectus Directive"). The Central Bank of Ireland only
approves this Prospectus as meeting the requirements imposed under Irish and EU law pursuant to the Prospectus Directive. Such
approval relates only to Notes that are to be admitted to trading on a regulated market for the purposes of Directive 2004/39/EC
and/or that are to be offered to the public in any member state of the European Economic Area. Application has been made to the
Irish Stock Exchange for the Notes to be admitted to its official list (the "Official List") and trading on its regulated market (the
"Main Securities Market"); however, no assurance can be given that such application will be accepted. References in this
Prospectus to the Notes being "listed" (and all related references) shall mean that the Notes have been admitted to the Official List
and trading on the Main Securities Market.
Application has been made to the Capital Markets Board of Turkey (the "CMB"), in its capacity as competent authority under Law
No. 6362 (the "Capital Markets Law") of the Republic of Turkey ("Turkey") relating to capital markets, for the issuance and sale of
the Notes by the Bank outside of Turkey. The Notes cannot be sold before the approved issuance certificate (ihraç belgesi) and the
approved tranche issuance certificate (tertip ihraç belgesi) have been obtained from the CMB. The CMB issuance certificate
relating to the issuance of notes under the Program based upon which the offering of the Notes is conducted was obtained on
March 19, 2013, and the tranche issuance certificate bearing the approval of the CMB relating to the Notes is expected to be
obtained from the CMB on or before the Issue Date.
The Notes are expected to be rated at issuance "BBB" by Fitch Ratings Ltd. ("Fitch") and "Baa2" by Moody's Investors Service
Limited ("Moody's" and, together with Fitch and Standard & Poor's Credit Market Services Europe Limited, the "Rating
Agencies"). The Bank has also been rated by the Rating Agencies, as set out on page 144 of the Base Prospectus. Each of the Rating
Agencies is established in the European Union and is registered under Regulation (EU) No 1060/2009, as amended (the "CRA
Regulation"). As such, each of the Rating Agencies is included in the list of credit rating agencies published by the European
Securities and Markets Authority on its website (at http://www.esma.europa.eu/page/List-registered-and-certified-CRAs) in
accordance with the CRA Regulation. A security rating is not a recommendation to buy, sell or hold securities and may be subject to
suspension, reduction or withdrawal at any time by the assigning rating agency.
The Notes are being offered under Rule 144A and Regulation S by each of BNP Paribas, Commerzbank Aktiengesellschaft, J.P.
Morgan Securities plc, Morgan Stanley & Co. International plc and Standard Chartered Bank (each an "Initial Purchaser" and,
collectively, the "Initial Purchasers"), subject to their acceptance and right to reject orders in whole or in part. It is expected that:
(a) delivery of the Rule 144A Notes will be made in book-entry form only through the facilities of The Depository Trust Company
("DTC"), against payment therefor in immediately available funds on the Issue Date (i.e., the sixth Business Day following the date
of pricing of the Notes; such settlement cycle being referred to herein as "T+6")), and (b) delivery of the Regulation S Notes will be
made in book-entry form only through the facilities of Euroclear Bank S.A./N.V. ("Euroclear") and/or Clearstream Banking, société
anonyme ("Clearstream, Luxembourg"), against payment therefor in immediately available funds on the Issue Date.
Joint Lead Managers
BNP PARIBAS
Commerzbank
J.P. Morgan
Morgan Stanley
Standard Chartered Bank
The date of this Prospectus is October 11, 2013.


This Prospectus comprises a prospectus for the purposes of the Prospectus Directive. This
document does not constitute a prospectus for the purpose of Section 12(a)(2) of, or any other
provision of or rule under, the Securities Act.
This Prospectus is to be read in conjunction with all documents which are deemed to be
incorporated herein by reference (see "Documents Incorporated by Reference"). This Prospectus
shall be read and construed on the basis that such documents are incorporated in, and form
part of, this Prospectus.
The Issuer, having made all reasonable enquiries, confirms that: (a) this Prospectus (including the
information incorporated herein by reference) contains all information that in its view is material in
the context of the issuance and offering of the Notes (or beneficial interests therein), (b) the
information contained in, or incorporated by reference into, this Prospectus is true and accurate in all
material respects and is not misleading, (c) any opinions, predictions or intentions expressed in this
Prospectus (or any of the documents incorporated herein by reference) on the part of the Issuer are
honestly held or made by the Issuer and are not misleading in any material respects, and there are no
other facts the omission of which would make this Prospectus or any of such information or the
expression of any such opinions, predictions or intentions misleading in any material respect, and (d)
all reasonable enquiries have been made by the Issuer to ascertain such facts and to verify the
accuracy of all such information and statements.
The Issuer accepts responsibility for the information contained in this Prospectus. To the best of the
knowledge of the Issuer (having taken all reasonable care to ensure that such is the case) the
information contained in this Prospectus is in accordance with the facts and does not omit anything
likely to affect the import of such information.
To the fullest extent permitted by law, none of the Initial Purchasers accept any responsibility for the
information contained in, or incorporated by reference into, this Prospectus or any other information
provided by the Issuer in connection with the Notes or for any statement inconsistent with this
Prospectus made, or purported to be made, by an Initial Purchaser or on its behalf in connection with
the Notes. Each Initial Purchaser accordingly disclaims all and any liability that it might otherwise
have (whether in tort, contract or otherwise) in respect of the accuracy or completeness of any such
information or statements. The Initial Purchasers expressly do not undertake to review the financial
condition or affairs of the Issuer during the life of the Notes or to advise any investor in the Notes of
any information coming to their attention.
No person is or has been authorized by the Issuer to give any information or to make any
representation not contained in or not consistent with this Prospectus or any other information
supplied in connection with the Notes and, if given or made, such information or representation must
not be relied upon as having been authorized by the Issuer or any of the Initial Purchasers.
Neither this Prospectus nor any other information supplied in connection with the Notes: (a) is
intended to provide the basis of any credit or other evaluation or (b) should be considered as a
recommendation by the Issuer or any of the Initial Purchasers that any recipient of this Prospectus or
any other information supplied in connection with the Notes should invest in any Notes. Each investor
contemplating investing in the Notes should determine for itself the relevance of the information
contained in, or incorporated into, this Prospectus and make its own independent investigation of the
financial condition and affairs, and its own appraisal of the creditworthiness, of the Issuer based upon
such investigation as it deems necessary.
This Prospectus does not constitute an offer of, or an invitation by or on behalf of the Issuer or any of
the Initial Purchasers to any person to subscribe for or purchase, any Notes (or beneficial interests
therein). This Prospectus is intended only to provide information to assist potential investors in
1


deciding whether or not to subscribe for or purchase Notes (or beneficial interests therein) in
accordance with the terms and conditions specified by the Initial Purchasers.
Neither the delivery of this Prospectus nor the offering, sale or delivery of the Notes (or beneficial
interests therein) shall in any circumstances imply that the information contained herein concerning
the Issuer is correct at any time subsequent to the date hereof or that any other information supplied in
connection with the Notes is correct as of any time subsequent to the date indicated in the document
containing the same.
The distribution of this Prospectus and the offer or sale of Notes (or beneficial interests therein) may
be restricted by law in certain jurisdictions. The Issuer and the Initial Purchasers do not represent that
this Prospectus may be lawfully distributed, or that the Notes (or beneficial interests therein) may be
lawfully offered, in compliance with any applicable registration or other requirements in any such
jurisdiction, or pursuant to an exemption available thereunder, or assume any responsibility for
facilitating any such distribution or offering. In particular, no action has been taken by the Issuer
which is intended to permit a public offering of the Notes (or beneficial interests therein) or
distribution of this Prospectus in any jurisdiction in which action for that purpose is required.
Accordingly, no Notes (or beneficial interests therein) may be offered or sold, directly or indirectly,
and neither: (a) this Prospectus nor (b) any advertisement or other offering material may be distributed
or published in any jurisdiction, except under circumstances that will result in compliance with any
applicable laws and regulations. Persons into whose possession this Prospectus or any Notes (or
beneficial interests therein) may come must inform themselves about, and observe, any such
restrictions on the distribution of this Prospectus, any advertisement or other offering material and the
offering and sale of Notes (or beneficial interests therein). In particular, there are restrictions on the
distribution of this Prospectus and the offer or sale of Notes (or beneficial interests therein) in the
United States, the European Economic Area (including the United Kingdom), the Republic of Turkey,
Japan, the People's Republic of China (the "PRC"), Hong Kong and Switzerland, see "Subscription
and Sale and Transfer and Selling Restrictions" in the Base Prospectus.
In making an investment decision, investors must rely on their own examination of the Issuer and the
terms of the Notes, including the merits and risks involved. The Notes have not been approved or
disapproved by the United States Securities and Exchange Commission or any other securities
commission or other regulatory authority in the United States and, other than the approvals of the
CMB and the Central Bank of Ireland described herein, have not been approved or disapproved by
any other securities commission or other regulatory authority in any other jurisdiction, nor have the
foregoing authorities (other than the Central Bank of Ireland to the extent described herein) approved
this Prospectus or confirmed the accuracy or determined the adequacy of the information contained in
this Prospectus. Any representation to the contrary is unlawful.
None of the Initial Purchasers or the Issuer makes any representation to any investor in the Notes
regarding the legality of its investment under any applicable laws. Any investor in the Notes should be
able to bear the economic risk of an investment in the Notes for an indefinite period of time.
The Notes may not be a suitable investment for all investors. Each potential investor in the Notes
must determine the suitability of that investment in light of its own circumstances. In particular, each
potential investor may wish to consider, either on its own or with the help of its financial and other
professional advisers, whether it:
(a)
has sufficient knowledge and experience to make a meaningful evaluation of the Notes, the
merits and risks of investing in the Notes and the information contained in, or incorporated by
reference into, this Prospectus;
(b)
has access to, and knowledge of, appropriate analytical tools to evaluate, in the context of its
particular financial situation, an investment in the Notes and the impact such investment will
have on its overall investment portfolio;
2


(c)
has sufficient financial resources and liquidity to bear all of the risks of an investment in the
Notes, including where the currency for principal or interest payments is different from the
potential investor's currency;
(d)
understands thoroughly the terms of the Notes and is familiar with the behavior of financial
markets; and
(e)
is able to evaluate possible scenarios for economic, interest rate and other factors that may
affect its investment and its ability to bear the applicable risks.
Legal investment considerations may restrict certain investments. The investment activities of certain
investors are subject to legal investment laws and regulations, or to review or regulation by certain
authorities. Each potential investor should consult its legal advisers to determine whether and to what
extent: (a) the Notes are legal investments for it, (b) the Notes (or beneficial interests therein) can be
used by it as collateral for various types of borrowing and (c) other restrictions apply to its purchase
or pledge of any Notes (or beneficial interests therein). Financial institutions should consult their legal
advisers or the appropriate regulators to determine the appropriate treatment of investments in the
Notes under any applicable risk-based capital or similar rules.
GENERAL INFORMATION
The Notes have not been and will not be registered under the Securities Act or under the securities or
"blue sky" laws of any state of the United States or any other US jurisdiction. Each investor, by
purchasing a Note (or a beneficial interest therein), agrees that the Notes (or beneficial interests
therein) may be reoffered, resold, pledged or otherwise transferred only upon registration under the
Securities Act or pursuant to the relevant exemptions from the registration requirements thereof
described herein and under "Subscription and Sale and Transfer and Selling Restrictions" in the Base
Prospectus. Each investor in the Notes also will be deemed to have made certain representations and
agreements as described in the Base Prospectus. Any resale or other transfer, or attempted resale or
other attempted transfer, of the Notes (or a beneficial interest therein) that is not made in accordance
with the transfer restrictions may subject the transferor and transferee to certain liabilities under
applicable securities laws.
The Issuer has obtained the approved issuance certificate (ihraç belgesi) from the CMB (dated
March 19, 2013 No. 29833736-105.03.01-769 (2768)) (the "CMB Approval") and the Banking
Regulatory
and
Supervisory
Agency
approval
(dated
January 17,
2013
and
numbered
20008792.44.2-1497) (together with the CMB Approval, the "Approvals") required for the issuance of
the Notes. In addition to the Approvals, a tranche issuance certificate (tertip ihraç belgesi) in respect
of the Notes shall be obtained from the CMB by the Issuer on or before the Issue Date. Pursuant to the
Approvals, the offer, sale and issue of the Notes has been authorized and approved in accordance with
Decree 32 on the Protection of the Value of the Turkish Currency (as amended from time to time,
"Decree 32"), the Banking Law numbered 5411 and its related legislation, the Capital Markets Law
numbered 6362 and Communiqué Serial II, No. 22 on the Principles on the Registration and Sale of
Debt Instruments that was in force at the time the Approvals were obtained or its related regulation.
The tranche issuance certificate from the CMB relating to the approval of the issue of the Notes is
expected to be obtained on or before the Issue Date.
In addition, the Notes (or beneficial interests therein) may only be offered or sold outside of Turkey in
accordance with the Approvals. Under the CMB Approval, the CMB has authorized the offering, sale
and issue of the Notes on the condition that no sale or offering of Notes (or beneficial interests
therein) may be made by way of public offering or private placement in Turkey. Notwithstanding the
foregoing, pursuant to the BRSA decision dated May 6, 2010 No. 3665 and in accordance with
Decree 32, residents of Turkey may purchase or sell Notes (as they are denominated in a currency
other than Turkish Lira) (or beneficial interests therein) offshore on an unsolicited (reverse inquiry)
basis in the secondary markets only. Further, pursuant to Article 15(d)(ii) of Decree 32, Turkish
3


residents may purchase or sell Notes (or beneficial interests therein) offshore on an unsolicited
(reverse inquiry) basis; provided that such purchase or sale is made through banks or licensed
brokerage institutions authorized pursuant to the CMB regulations and the purchase price is
transferred through banks. As such, Turkish residents should use banks or licensed brokerage
institutions while purchasing the Notes (or beneficial interests therein) and transfer the purchase price
through banks.
Monies paid for purchases of Notes (or beneficial interests therein) are not protected by the insurance
coverage provided by the Savings Deposit Insurance Fund (the "SDIF").
In accordance with Communiqué No. II-31.1 on Debt Instruments (the "Communiqué on Debt
Instruments"), the Notes are required under Turkish law to be issued in an electronically registered
form in the Central Registry Agency (
) (the "CRA") and the interests therein
recorded in the CRA; however, upon the Issuer's request, the CMB may resolve to exempt the Notes
from this requirement if the Notes are to be issued outside of Turkey. The Bank submitted an
exemption request through its letter to the CMB dated July 1, 2013 numbered 1754 and such
exemption was granted by the CMB in its letter to the Bank dated July 30, 2013 numbered
29833736-105.03.01-2414. As a result, this requirement will not be applicable to the Notes issued
during the pendency of the CMB Approval. Notwithstanding such exemption, the Issuer is required to
notify the CRA within three Turkish business days from the Issue Date of the amount, issue date,
ISIN code, first payment date, maturity date, interest rate, name of the custodian and currency of the
Notes and the country of issuance.
Notes offered and sold to QIBs in reliance on Rule 144A (the "Rule 144A Notes") will be represented
by beneficial interests in one or more Rule 144A Global Notes (as defined in the Base Prospectus).
Notes offered and sold in offshore transactions to persons who are not US persons pursuant to
Regulation S (the "Regulation S Notes") will be represented by beneficial interests in a Regulation S
Global Note (as defined in the Base Prospectus and, together with the Rule 144A Global Note(s), the
"Global Notes").
The Regulation S Global Note will be deposited on or about the Issue Date with a common depositary
(the "Common Depositary") for Euroclear and Clearstream, Luxembourg and will be registered in the
name of a nominee of the Common Depositary. Except as described in this Prospectus, beneficial
interests in the Regulation S Global Note will be represented through accounts of financial institutions
acting on behalf of beneficial owners as direct and indirect accountholders in Euroclear and
Clearstream, Luxembourg. The Rule 144A Global Note(s) will be deposited on or about the Issue
Date with The Bank of New York Mellon, New York Branch, in its capacity as custodian (the
"Custodian") for, and will be registered in the name of Cede & Co. as nominee of, DTC. Except as
described in this Prospectus, beneficial interests in the Rule 144A Global Note(s) will be represented
through accounts of financial institutions acting on behalf of beneficial owners as direct and indirect
participants in DTC.
In connection with the issue of the Notes, J.P. Morgan Securities plc (the "Stabilizing Manager") (or
persons acting on behalf of the Stabilizing Manager) may over-allot Notes or effect transactions with
a view to supporting the market price of the Notes at a level higher than that which might otherwise
prevail; however, there is no assurance that the Stabilizing Manager (or persons acting on behalf of
the Stabilizing Manager) will undertake any stabilization action. Any stabilization action may begin
on or after the date on which adequate public disclosure of the terms of the offer of the Notes is made
and, if begun, may be ended at any time, but it must end no later than the earlier of 30 days after the
Issue Date and 60 days after the date of the allotment of the Notes. Any stabilization action or over-
allotment must be conducted by the Stabilizing Manager (or persons acting on behalf of the
Stabilizing Manager) in accordance with all applicable laws and rules.
Notwithstanding anything herein to the contrary, the Bank may not (whether through over-allotment
or otherwise) issue more Notes than have been authorized by the CMB.
4


In this Prospectus, "Bank
Group" means
the Bank and its subsidiaries (and with respect to accounting information, its consolidated entities).
In this Prospectus, all references to "Turkish Lira" and "TL" refer to the lawful currency for the time
being of the Republic of Turkey, "euro" and " " refer to the currency introduced at the start of the
third stage of European economic and monetary union pursuant to the Treaty on the Functioning of
the European Union, as amended and "U.S. Dollars", "U.S.$" and "$" refer to United States dollars.
The language of this Prospectus is English. Certain legislative references and technical terms have
been cited in their original language in order that the correct technical meaning may be ascribed to
them under applicable law.
5


TABLE OF CONTENTS
RISK FACTORS .................................................................................................................................... 7
DOCUMENTS INCORPORATED BY REFERENCE........................................................................ 12
OVERVIEW OF THE OFFERING...................................................................................................... 14
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS ............................................................................................................. 19
SELECTED STATISTICAL AND OTHER INFORMATION ........................................................... 59
TERMS AND CONDITIONS OF THE NOTES ................................................................................. 76
U.S. TAXATION.................................................................................................................................. 81
PLAN OF DISTRIBUTION ................................................................................................................. 84
LEGAL MATTERS.............................................................................................................................. 87
OTHER GENERAL INFORMATION................................................................................................. 88
6


RISK FACTORS
Prospective investors in the Notes should consider carefully the information contained in this
Prospectus and the documents which are incorporated herein by reference, and in particular should
consider all the risks inherent in making such an investment, including the information under the
heading "Risk Factors" on pages 13 to 43 (inclusive) of the Base Prospectus (the "Program Risk
Factors"), before making a decision to invest. In investing in the Notes, investors assume the risk that
the Issuer may become insolvent or otherwise be unable to make all payments due in respect of the
Notes. There is a wide range of factors which individually or together could result in the Issuer
becoming unable to make all payments due in respect of the Notes. It is not possible to identify all
such factors or to determine which factors are most likely to occur, as the Issuer may not be aware of
all relevant factors and certain factors which it currently deems not to be material may become
material as a result of the occurrence of events outside the Issuer's control. The Issuer has identified
in the Program Risk Factors a number of factors which could materially adversely affect its business
and ability to make payments due under the Notes. In addition, a number of factors which are material
for the purpose of assessing the market risks associated with the Notes are also described in the
Program Risk Factors.
In addition, for purposes of the Notes the Program Risk Factors shall be deemed to be revised as
follows:
(a)
the first sentence of the first paragraph of "Risk Factors - Political, Economic and Legal Risks
relating to Turkey ­ High Current Account Deficit" in the Base Prospectus is hereby deleted
and replaced by the following: "In 2010, the Turkish current account deficit was US$45.4
billion, which increased to US$75.1 billion in 2011 before decreasing to US$47.8 billion in
2012 according to the Central Bank.",
(b)
the first two sentences of the last paragraph of "Risk Factors - Political, Economic and Legal
Risks relating to Turkey ­ High Current Account Deficit" in the Base Prospectus are hereby
deleted and replaced by the following: "The decline in the current account deficit experienced
in 2012 came to an end in early 2013, with (due to the recovery in domestic demand) the
annualized current account deficit increasing to US$54.0 billion as of June 2013. The Bank's
management expects this to be followed by a period of gradual increases until the end of the
year in parallel with the recovery in domestic demand compared to 2012. As the value of the
Turkish Lira decreases (having exceeded 2.0 TL/USD in August, a depreciation of
approximately 15% in the first eight months of 2013), the cost of importing oil and other
goods and services might increase while the value of exports might also increase, resulting in
potential increases or decreases in the current account deficit. The decrease in the value of the
Turkish Lira principally reflects changes in the global flow of funds caused by the expected
reduction by the U.S. Federal Reserve in its expansionary monetary policy. As an increase in
the current account deficit might erode financial stability in Turkey, the Central Bank has
recently taken certain actions to maintain price and financial stability. For example, in
meetings in July and August 2013, the Central Bank increased the upper band of the interest
rate corridor (the lending rate) from 6.5% to 7.25% and then 7.75% and also announced that
there will be no funding to banks via the primary dealer repo facility on additional monetary
tightening days. Such actions by the Central Bank and similar or other actions that it might
take in the future might not be successful in reducing the current account deficit.",
(c)
the last sentence of the first paragraph of "Risk Factors - Political, Economic and Legal Risks
relating to Turkey ­ Exchange Rates" in the Base Prospectus is hereby deleted and replaced
by the following: "According to the Central Bank, the CPI-based real effective exchange rate
increased from 109.63 as of December 31, 2011 to 118.18 as of December 31, 2012,
indicating a 7.8% real appreciation.",
7


(d)
the first sentence of the second paragraph of "Risk Factors - Political, Economic and Legal
Risks relating to Turkey ­ Exchange Rates" in the Base Prospectus is hereby deleted and
replaced by the following: "As of May 31, 2013, in nominal terms the Turkish Lira had
depreciated against the US Dollar by 4.7% compared to year-end 2012; however, on a real
basis, based upon the CPI-based real effective exchange rate, there was a 1.4% real
appreciation compared to year-end 2012.",
(e)
the following sentence is hereby inserted as a new third sentence of the last paragraph of
"Risk Factors - Political, Economic and Legal Risks relating to Turkey ­ Exchange Rates" in
the Base Prospectus: "In addition, rising geopolitical risks due to recent developments in
Syria have (inter alia) contributed to increased volatility in the value of the Turkish Lira,
which as of August 29, 2013 had depreciated by 10.2% since May 31, 2013 in nominal terms
(15.3% since December 31, 2012).",
(f)
the second sentence of "Risk Factors - Political, Economic and Legal Risks relating to Turkey
­ Government Default" in the Base Prospectus is hereby deleted and replaced in its entirety
with the following: "As of December 31, 2012, 94.1% of the Group's total securities portfolio
(21.0% of its total assets and equal to 169.5% of its shareholders' equity) was invested in
securities issued by the Turkish government (93.7%, 18.1% and 163.6%, respectively, as of
June 30, 2013) and 1.7% of the Group's total assets were used to make loans to Turkish
governmental and state-controlled entities.",
(g)
The risk factor entitled "Political, Economic and Legal Risks Relating to Turkey ­ Terrorism
and Conflicts" in the Base Prospectus is hereby deleted in its entirety and replaced by the
following:
Political uncertainty within Turkey and in certain neighboring countries, such as Iran, Iraq,
Georgia, Armenia and Syria, has historically been one of the potential risks associated with
investment in Turkish companies. Political instability in the Middle East and elsewhere
remains a concern, most recently exemplified by the internal conflict in Syria, tensions
between Iran and Israel and an economic and currency crisis in Iran. The conflict in Syria has
gained increased international attention recently, including calls by several Western nations
for military intervention. While such calls have been subject to broad international opposition,
the continuing conflict is inherently volatile and its impact and resolution is difficult to
predict. Turkey has also experienced problems with domestic terrorist and ethnic separatist
groups. For example, Turkey has been in conflict for many years with the People's Congress
of Kurdistan, formerly the known as the PKK (an organization that is listed as a terrorist
organization by states and organizations including Turkey, the EU and the United States). In
early October 2012 Turkish territory was hit by shells launched from Syria, some of which
killed Turkish civilians. On October 4, 2012, the Turkish Parliament authorized the
government for one year to send and assign military forces in foreign countries should such
action be considered appropriate by the government. On February 1, 2013, a suicide bomber
attacked the U.S. Embassy in Ankara killing himself and others. On May 11, 2013, two car
deaths of 52 people and significant additional casualties. The Taksim Square protests have
also contributed to recent volatility in the Turkish financial markets. Such circumstances and
domestic terrorist attacks have had and could continue to have a material adverse effect on the
Turkish economy and the Group's business, financial condition and/or results of operations.
(h)
the second sentence of "Risk Factors ­ Risks Relating to the Group and its Business ­
Foreign Exchange and Currency Risk" in the Base Prospectus is hereby deleted and replaced
in its entirety with the following: "For example, the Group had loans denominated in
currencies other than the Turkish Lira totaling the equivalent of TL 38,635 million, TL 42,073
million and TL 50,140 million as of December 31, 2011, December 31, 2012 and June 30,
8


2013, respectively, representing 39.0%, 36.7% and 37.4%, respectively, of the Group's total
loans at such dates.",
(i)
the penultimate sentence of "Risk Factors ­ Risks Relating to the Group and its Business ­
Interest Rate Risk" in the Base Prospectus is hereby deleted and replaced in its entirety with
the following: "In addition, as of June 30, 2013, 93.7% of the Group's securities portfolio
consisted of Turkish government debt securities, which accounted for 18.1% of the Group's
total assets.",
(j)
the following sentence is hereby inserted before the last sentence of the first paragraph of
"Risk Factors ­ Risks Relating to the Group and its Business ­ SME/Retail Concentration
Risk" in the Base Prospectus: "As of June 30, 2013: (a) 55.0% of the Bank's loan portfolio
consisted of retail loans and loans to SMEs (as defined by the BRSA SME Definition), with
retail loans accounting for 27.5% of the Bank's total loan portfolio, and loans to SMEs (as
defined by the BRSA SME Definition) accounting for 27.5%, (b) the Group's NPL ratio for
the first six months of 2013 was 1.8%, (c) the Bank's non-performing loans to SMEs (as
defined in the BRSA SME Definition) accounted for 2.4% of total NPLs and (d) the Group's
NPL ratio for retail loans (which consist of consumer loans, overdrafts and credit cards) was
2.4%.",
(k)
the following sentence is hereby inserted as a new second sentence of the first paragraph of
"Risk Factors ­ Risks Relating to the Group and its Business ­ Reduction in Earnings on
Investment Portfolio" in the Base Prospectus: "As of June 30, 2013, those numbers were
25.0% and 15.9%, respectively.",
(l)
the second paragraph of "Risk Factors - Risks Relating to the Group and its Business ­
Banking Regulatory Matters" in the Base Prospectus is hereby deleted in its entirety and
replaced by the following: "In the future, Turkish banks' capital adequacy requirement will be
further affected by Basel III, which includes requirements regarding regulatory capital,
liquidity, leverage ratio and counterparty credit risk measurements, which are expected to be
implemented between 2014 and 2019. In 2013, the BRSA announced its intention to adopt the
Basel III requirements and, as published in the Official Gazette dated September 5, 2013 and
numbered 28756, adopted the Regulation on the Equities of Banks and amendments to the
Regulation on the Measurement and Evaluation of the Capital Adequacy of Banks, both of
which will enter into effect on January 1, 2014. The Regulation on the Equities of Banks
introduces core Tier I capital and additional Tier I capital as components of Tier I capital,
whereas the amendments to the Regulation on the Measurement and Evaluation of Capital
Adequacy of Banks: (a) introduced a minimum core capital adequacy standard ratio (4.5%)
and a minimum Tier I capital adequacy standard ratio (6.0%) to be calculated on a
consolidated and non-consolidated basis (which are in addition to the previously existing
requirement for a minimum total capital adequacy ratio of 8.0%) and (b) change the risk
weights of certain items that are categorized under "other assets." The new Regulation on the
Equities of Banks has also introduced new Tier II rules and determined new criteria for debt
instruments to be included in the Tier II capital.
In addition to these new regulations: (a) a draft Regulation on the Capital Maintenance and
Cyclical Capital Buffer, which regulates the procedures and principles regarding the
calculation of additional core capital amount, was made available by the BRSA for public
review, (b) the BRSA published its draft Regulation on the Measurement and Evaluation of
Leverage Levels of Banks, through which regulation the BRSA would seek to constrain
leverage in the banking system and maintenance of adequate equity on a consolidated and
non-consolidated basis against leverage risks (including measurement error in the risk-based
capital measurement approach), and (c) in order to ensure that a bank maintains an adequate
level of unencumbered, high-quality liquid assets that can be converted into cash to meet its
liquidity needs for a 30 calendar day period, the BRSA has published a draft regulation on a
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