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TÜRKİYE İŞ BANKASI A.Ş.
Notes to the Unconsolidated Financial Statements for the Year Ended
31 December 2014
FINANCIAL INFORMATION AND
RISK MANAGEMENT
125
İŞBANK
ANNUAL REPORT 2014
Fair values of investments held to maturity securities issued is determined by using the market prices; in cases where market prices cannot be measured, quoted market prices of
other securities that are subject to amortization having similar interest, maturity and other conditions are taken as the basis for the fair value determination.
Market prices are taken into account in determining the fair values of the securities available for sale. When the prices cannot be measured in an active market, fair values are not
deemed to be reliably determined and amortized cost, calculated by the internal rate of return method, are taken into account as the fair values.
Fair values of banks, loans granted, deposits and funds borrowed from other financial institutions and marketable securities are calculated by discounting the amounts in each
maturity bracket formed according to repricing periods, using the rate corresponding to relevant maturity bracket in the discount curves based on current market conditions.
2. Information on fair value measurements recognized in the financial statements
“TFRS 13 - Fair Value Measurement” standard requires the items, which are recognized in the balance sheet at their fair values to be shown in the notes by being classified within
a range. According to this, the related financial instruments are classified into three levels in such a way that they will express the significance of the data used in fair value
measurements. At the first level, there are financial instruments, whose fair values are determined according to quoted prices in active markets for identical assets or liabilities, at the
second level, there are financial instruments, whose fair values are determined by directly or indirectly observable market data, and at the third level, there are financial instruments,
whose fair values are determined by the data, which are not based on observable market data. The financial assets, which are recognized in the balance sheet at their values, are
shown below as classified according to the aforementioned principles of ranking.
Current Period
Level 1
Level 2
Level 3
Financial Assets at Fair Value Through Profit and Loss
Debt Securities
253,619
10,255
1,072
Equity Securities
Derivative Financial Assets Held for Trading
973,309
Other
Financial Assets Available-for-Sale
(1)
Debt Securities
32,029,800
6,315,820
744,601
Other
53,793
Investments in Subsidiaries and Associates
(2)
7,251,253
Derivative Financial Liabilities
630,151
(1)
Since they are not traded in an active market, the equity securities (TL 145,947) under the financial assets available-for-sale are shown in the financial statements at acquisition cost and the related securities are
not shown in this table.
(2)
Since the unlisted investments in associates and subsidiaries are recognized at acquisition cost within the framework of “TAS 39”, these companies are not included in the table.
Prior Period
Level 1
Level 2
Level 3
Financial Assets at Fair Value Through Profit and Loss
Debt Securities
827,854
5,901
57,228
Equity Securities
2
Derivative Financial Assets Held for Trading
1,312,573
Other
Financial Assets Available-for-Sale
(1)
Debt Securities
18,989,827
5,190,812
4,095,104
Other
44,002
Investments in Subsidiaries and Associates
(2)
5,585,702
Derivative Financial Liabilities
981,522
(1)
Since they are not traded in an active market, the equity securities (TL 28,085) under the financial assets available-for-sale are shown in the financial statements at acquisition cost and the related securities are
not shown in this table.
(2)
Since the unlisted investments in associates and subsidiaries are recognized at acquisition cost within the framework of TAS 39, these companies are not included in the table.
The movement table of financial assets at level 3 is given below.
Current Period
Prior Period
Balance at the Beginning of the Period
4,152,332
1,234,938
Purchases
53,576
2,995,775
Redemption or Sales
(513,800)
(297,139)
Valuation Difference
33,337
171,547
Transfers
(2,979,772)
47,211
Balance at the end of the Period
745,673
4,152,332
XIV. Explanations on Transactions Carried Out on Behalf of Third Parties and Fiduciary Transactions
The Bank gives trading, custody, fund management services in the name and on the account of its customers. The Bank has no fiduciary transactions.
XV. Explanations on Segment Reporting
The Bank’s operations are classified as corporate, commercial, retail and private banking, and treasury/investment banking.
The Bank provides services to the large corporations, SMEs and other trading companies through various financial media within the course of its corporate and commercial operations.
Services such as project financing, operating and investment loans, deposit and cash management, credit cards, cheques and bills, foreign trade transactions and financing, letter
of guarantees, letter of credits, forfeiting, foreign currency trading, bill collections, payrolls, investment accounts, tax collections and other banking services are provided for the
aforementioned customer segments.
Retail banking services are comprised of individuals needs such as deposits, consumer loans, overdraft accounts, credit cards, bill collections, remittances, foreign currency trading,
safe-deposit boxes, insurance, tax collections, and investment accounts and by other banking services. Private banking category, are comprised of any kind of financial and cash
management related services provided for individuals within the high-income segment.