TOKİ is one of the public organizations with exclusive responsibilities with respect to housing and settlement issues in Turkey due to its mission. In this respect, the Administration is not in a competitive environment.
In virtue of its legal status as a public agency, TOKİ has no share capital, it cannot be declared bankrupt and its assets are immune from attachment.
TOKİ prepares corporate annual reports (income statements and balance sheets) by finalizing the legal ledgers it keeps “on balance sheet basis”.
In the end-of-the-term final balance sheet of TOKİ for 2013, its revolving assets have increased by 17%, and its fixed assets have decreased by 11% compared to the previous year. The increase of the real estate stocks included in the revolving assets has been 46%.
TOKİ takes over lands with and/or without a price from the Treasury, public entities and government agencies and municipalities.
The size of TOKİ’s land portfolio (square meter area of the land under stock records) amounts to 170.705.716 m², by January 2015. The total size of the real estate under the possession of the Administration along with the area sold by TOKİ or area with project implementations thereon is 210.375.470,00 m2.
(The calculation takes as a basis land appraisal, acquisition value and real estate value statement. These data are subject to amendments due to the investment program of the Administration.)
With the decision of the Board of Ministers dated 03 April 2001 and numbered 2001/2202 putting forth the principles and procedures regarding restructuring of the public banks, the assets of T.Emlak Bankası A.Ş., except for those related to the banking procedures, and the shares and commercial real estates of its companies active in the field and surplus real estates have been transferred to TOKI, and according to the Decision of the Supreme Planning Board regulating implementation of the Regulation in question dated 14 August 2001 and numbered 2001/T-27, the Administration has issued and delivered to T.Emlak Bankası A.Ş. (in liquidation) a note payable at the amount of the balance sheet value of the assets thus acquired. The note payable in question amounts to 1.247 million TL. Conditions of payment for the debt have been set as two year without reimbursement and five years with equal installments. However, with the decision of the Supreme Planning Board taken on 23 November 2012, it was decided to raise the period without reimbursement of this note to fourteen (14) years, and its total maturity to nineteen (19) years, delaying commencement of reimbursements to August 2015.
All of TOKİ’s accounts are audited and discharged by the Court of Auditors, in the name of Grand National Assembly of Turkey.
The receivables portfolio of the Administration consists of the receivables from the sales of the social welfare housing projects, land sales, Administration's share from the receivables from the Revenue Sharing Projects and the receivables from the housing loans.
Other income, including items such as budget appropriation and levies on Turkish citizens travelling abroad, has reduced as a share of total revenue due to cuts in those items and increases in the housing units sold.
Credit lines are also kept available for TOKI with banks (either public or private) for funding needs that may arise in case of a possible liquidity problem. Borrowing can be made when necessary. No loan was made available between 2011 - 2014.
TOKİ’s expenditure is mainly directed toward developing land plots and constructing housing units; these items accounted for 91% of total expenditure in 2011. With increased borrowing compared with previous years, expenses covering interest, fees and taxes have also been gaining significance. Net income improved significantly from 2005 as projects that were begun earlier started to yield returns and has been on an increasing trend.
TOKİ had some attempts to provide foreign loans (foreign borrowing) in the past. But the procedure has been stopped due to the Banks’ change in their financial proposals and due to various economic situations in the country. (Turkish Treasury must approve any foreign borrowing that TOKİ may need.)
In line with the development of the regulatory environment, TOKİ has options for alternative funding mechanisms, including debt issuance through tailored financial vehicles. In the past, the Administration had contributed to the work for a regulation on the issuance of asset-backed debt securities of Capital Markets Board of Turkey using its expertise drawn from its asset pool.
Due to the mutual work with the foreign financial banks and institutions, TOKİ has provided international rating services from international rating institutions since 2007.
As of 11 November 2013, Fitch Ratings announced the long-term foreign currency credit rating as BBB-, and domestic currency credit rating as ‘BBB’ for the Housing Development Administration. The entity also determined the long-term national credit rating of TOKI as ‘ΑAA(tur)’ and made the same public.
As to Moody’s Investors Service, it confirmed the issuing institution rating of TOKI (at global and Turkish national scale) as Baa3/Aa3.tr, and the outlook of credit ratings as “negative” on 10 November 2014.