MILLI REASURANS ANNUAL REPORT 2018

Millî Reasürans Türk Anonim Şirketi NOTES TO THE UNCONSOLIDATED 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) The Company’s exposure to foreign currency risk is as follows: December 31, 2018 US Dollar Euro Other currencies Total Assets: Cash and cash equivalents 398.635.043 17.362.486 5.589.240 421.586.769 Receivables from main operations 69.372.305 32.350.106 152.399.146 254.121.557 Total foreign currency assets 468 .007.348 49.712.592 157.988.386 675.708.326 Liabilities: Payables arising from main operations (12.881.791) (8.260.518) (20.458.243) (41.600.552) Insurance technical reserves (*) (241.303.121) (128.788.912) (125.188.008) (495.280.041) Total foreign currency liabilities (254.184.912) (137.049.430) (145.646.251) (536.880.593) Net financial position 213.822.436 (87.336.838) 12.342.135 138.827.733 December 31, 2017 US Dollar Euro Other currencies Total Assets: Cash and cash equivalents 263.984.818 12.469.766 3.174.131 279.628.715 Receivables from main operations 40.875.377 15.997.108 82.757.734 139.630.219 Total foreign currency assets 304.860.195 28.466.874 85.931.865 419.258.934 Liabilities: Payables arising from main operations (9.284.248) (3.293.305) (10.819.470) (23.397.023) Insurance technical reserves (*) (126.051.494) (93.800.091) (126.962.691) (346.814.276) Total foreign currency liabilities (135.335.742) (97.093.396) (137.782.161) (370.211.299) Net financial position 169.524.453 (68.626.522) (51.850.296) 49.047.635 (*) According to the “Communiqué on Amendments to Communiqué on Technical Reserves for Insurance, Reinsurance and Pension Companies and the Related Assets That Should Be Invested Against Those Technical Reserves” published in Official Gazette no 27655 dated July 28, 2010; foreign currency denominated claims provisions evaluated by the Central Bank of Republic of Turkey’s spot sales rates. TL equivalents of the related monetary amounts denominated in foreign currencies are presented in the above table. Foreign currency rates used for the translation of foreign currency denominated monetary assets and liabilities as of reporting dates are as follows: At the end of the period Average US Dollar Euro US Dollar Euro December 31, 2018 5,2609 6,0280 4,8301 5,6789 December 31, 2017 3,7719 4,5155 3,6445 4,1159 Exposure to foreign currency risk 20 percent depreciation of the TL against the following currencies as of December 31, 2018 would have increased or decreased equity and profit or loss (excluding tax effects) by the amounts shown below (December 31, 2017: 10 percent depreciation of the TL). This analysis assumes that all other variables, in particular interest rates, remain constant. In case of a 20 percent appreciation of the TL against the following currencies, the effect will be in opposite direction. December 31, 2018 December 31, 2017 Profit or loss Equity (*) Profit or loss Equity (*) US Dollar 42.764.487 42.764.487 16.952.445 16.952.445 Euro (17.467.368) (17.467.368) (6.862.652) (6.862.652) Others 2.468.427 2.468.427 (5.185.030) (5.185.030) Total, net 27.765.546 27.765.546 4.904.763 4.904.763 (*) Equity effect also includes profit or loss effect of 20% depreciation of TL against related currencies (December 31, 2017: 10% depreciation of TL). Millî Reasürans Annual Report 2018 Unconsolidated Financial Statements and Independent Auditors’ Report / 129