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21.10.2008

Turkey remains an emerging market with great potential

In the course of the last few years Turkey has achieved a high level of economic stability, making it a focus of foreign investment. The market's size and potential offer substantial business opportunities, and compared with previous years, Turkey is today one of the world's most promising economies. The country is also the bridge to the heart of Eurasia. These factors make Turkey an investment target for all big international companies.

A number of facts underline Turkey's significance and potential. Turkey, the world's 17th largest economy, is the fastest-growing emerging market after the BRICs (Brazil, Russia, India and China). Its population of about 70 million, whose salaries are rising rapidly, provides a potential for economic growth which is without comparison in Europe. The business environment in Turkey has improved substantially in the wake of far-reaching reforms triggered by the crisis in 2001, and the country's GDP grew by an average 7 % from 2002 to 2007, sometimes recording annual peaks of 9 %.

The current crisis has of course taken its toll on the Turkish economy, just as it has an effect on the whole spectrum of emerging markets in the CEE region. While they are not at the epicentre of the crisis, they feel the impact of the crisis through lower capital inflows and higher risks. However, the Turkish economy is sound, and our economists expect GDP growth of 3.8 % for 2008 and 3 % for 2009.

Turkey is however sensitive to investor sentiment as it is an emerging market with a low rating, Turkish assets are very liquid and risks are relatively high. Turkey will nonetheless remain a market of great potential as its banking sector is now in better shape than before and less dependent on external funding than other emerging markets. The political situation has stabilised and weaker growth has eased fears of inflation as there are fewer price pressures and lower import volumes.

Bank Austria, as part of UniCredit Group, is represented in Turkey through YapiKredi, one of the country's leading banks. Since it was founded as the first privately-owned bank in 1944, YapiKredi has grown to become Turkey's fifth-largest bank, with about 790 branches and 14,800 employees. With a market share of 9 % YapiKredi is one of the strong players in the banking sector, reflected in its role as undisputed market leader in core segments such as card business or asset management. Through sustainable growth and value creation YapiKredi is aiming to become the leading bank in Turkey's financial sector. Additional information on YapiKredi is available on the bank's website www.yapikredi.com.tr.

About UniCredit Group
With total assets of more than €1,060 billion, ranking among the top financial groups in Europe, UniCredit has a presence in 22 countries, with over 40 million clients, around 10,000 branches and some 180,000 employees.
In the CEE region, UniCredit operates the largest international banking network with around 4,000 branches and outlets, where around 83,000 employees serve more than 28 million customers. The Group operates in the following countries: Azerbaijan, Bosnia and Herzegovina, Bulgaria, Croatia, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Kazakhstan, Kyrgyzstan, Poland, Romania, Russia, Serbia, Slovakia, Slovenia, Turkey and Ukraine.

Requests: Communications CEE
Silvana Lins
Phone: +43 (0) 50505 56036
E-mail : silvana.lins@unicreditgroup.at

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