Dear Stakeholders,

2023 was a year in which we experienced the disaster of the century before the wounds left by events in our country and around the world had fully healed. Coming on top of the challenges created by the impact on our national economy of the inflationary processes seen especially in the global arena in 2022, and of the sharp volatility and upward trends in commodity prices and exchange rates, this situation unfortunately added further pressure and burden on our economy. During this period, the responsibilities of the banking and finance sector in particular increased significantly. As always, the Participation Finance Sector strove to more than fulfil its responsibilities during this time, making every effort to stand by its customers and stakeholders across all segments, SMEs in particular, and to provide them with the support they needed.

According to 2023 BRSA (BDDK) data, the Participation Finance sector reached a financing volume of TRY 905 billion, supporting the national economy through this challenging period.

In recent years, we have seen the participation finance sector working to fill important gaps within its own ecosystem. In particular, intensive work is being carried out in all areas set out in the Participation Finance Strategy Report prepared by the Presidency of the Republic of Türkiye Finance Office and presented by our President, such as improving the regulatory infrastructure, designing and launching the new products that are needed, and establishing the institutions the ecosystem requires. It should be especially noted that one of the sector's important advantages is the uninterrupted support of the current political will.

Guarantee companies, which support all businesses, SMEs in particular, that have difficulty accessing credit because they cannot meet the required collateral conditions, have until now operated within the field of conventional banking.
The absence of a guarantee company able to meet the guarantee needs of businesses that have adopted the Participation Finance system stood out as a gap in the ecosystem. Katılım Finans Kefalet (KFK) took its place in the sector precisely to close this gap, as an indispensable part of the Participation Finance ecosystem.

This strong alliance, formed by all Participation Banks operating in Türkiye coming together and joining forces with the Ministry of Treasury and Finance of the Republic of Türkiye, best reflects the spirit of solidarity in the sector. This alliance is not just a business partnership; it is also an important forward-looking step that will encourage the establishment of similarly structured companies for Türkiye's Participation Finance ecosystem.

I would particularly like to emphasise that, as Katılım Finans Kefalet, we have an approach that supports production, investment, exports and employment in line with Türkiye's economic goals. In 2024, by accelerating the operations we began with the strong team and infrastructure we built swiftly after our establishment, we are determined to further strengthen our position in the sector and to contribute to our country's development and financial stability.

On this occasion, I would like to sincerely thank my colleagues on the Board of Directors for their valuable contributions, and all our employees and stakeholders for their dedicated work.
Yours sincerely,

Prof. Dr. Murat BALCI
Chairman of the Board of Directors