MILLI REASURANS ANNUAL REPORT 2018

Millî Reasürans Türk Anonim Şirketi NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2018 (Currency: Turkish Lira (TL)) (Convenience Translation of Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish, See Note 2.1.1) An actuarial report has been obtained from registered actuary regarding calculation of the amount to be paid to the Social Security Institution by the Company in accordance with the new law. The CSO 1980 mortality table for December 31, 2018 and the TSI 2013 mortality table for December 31, 2017 9.8% of technical deficit interest rate are taken into account in the calculation of the said technical deficit. No real increase/ decrease is anticipated in salary and health expenses. The health benefits to be paid will be considered by the Group management due to the changes in the Social Security Institution legislation and other regulations. As of December 31, 2018 and 2017, technical deficit from pension funds comprised the following. December 31, 2018 December 31, 2017 Net present value of total liabilities other than health (133.663.392) (120.115.748) Net present value of insurance premiums 29.450.709 25.469.048 Net present value of total liabilities other than health (104.212.683) (94.646.700) Net present value of health liabilities (16.741.096) (14.756.726) Net present value of health premiums 16.332.152 13.918.802 Net present value of health liabilities (408.944) (837.924) Pension fund assets 59.884.815 56.149.509 Amount of actuarial and technical deficit (44.736.812) (39.335.115) Plan assets are comprised of the following items: December 31, 2018 December 31, 2017 Cash and cash equivalents 48.840.924 46.869.599 Associates 9.682.845 8.356.885 Other 1.361.046 923.025 Total plan assets 59.884.815 56.149.509 Up to date, as per the actuarial calculation performed, there has not been any deficit in Anadolu Anonim Türk Sigorta Şirketi Memurları Emekli Sandığı and Anadolu Sigorta has made no payment for this purpose. It is believed that the assets of this institution are adequate enough to cover its total obligations; therefore this shall not constitute any additional liability on Anadolu Sigorta. Millî Reasürans Annual Report 2018 238 / Consolidated Financial Statements and Independent Auditors’ Report