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) Classification relevant to fair value information TFRS 7 - Financial instruments: Disclosures requires the classification of fair value measurements into a fair value hierarchy by reference to the observability and significance of the inputs used in measuring fair value of financial instruments measured at fair value to be disclosed. This classification basically relies on whether the relevant inputs are observable or not. Observable inputs refer to the use of market data obtained from independent sources, whereas unobservable inputs refer to the use of predictions and assumptions about the market made by the Group. This distinction brings about a fair value measurement classification generally as follows: Level 1: Fair value measurements using quoted prices (unadjusted) in active markets for identical assets or liabilities; Level 2: Fair value measurements using inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (as prices) or indirectly (derived from prices); Level 3: Fair value measurements using inputs for the assets or liability that are not based on observable market data (unobservable inputs). Classification requires the utilization of observable market data, if available. The classification of fair value measurements of financial assets and liabilities measured at fair value is as follows: December 31, 2018 Level 1 Level 2 Level 3 Total Financial assets: Available for sale financial assets (Note 11) (*) 894.766.318 111.010.219 - 1.005.776.537 Financial assets held for trading (Note 9) 73.091.120 106.461.626 - 179.552.746 Associates - 199.307.030 - 199.307.030 Subsidiaries - 3.445.290 - 3.445.290 Total financial assets 967.857.438 420.224.165 - 1.388.081.603 Tangible assets: Investment properties (Note 6) - 455.721.000 - 455.721.000 Owner occupied properties (Note 6) - 194.296.000 - 194.296.000 Total tangible assets - 650.017.000 - 650.017.000 Total 967.857.438 1.070.241.165 - 2.038.098.603 December 31, 2017 Level 1 Level 2 Level 3 Total Financial assets: Available for sale financial assets (Note 11) (*) 918.673.655 219.514.315 67.311.993 1.205.499.963 Financial assets held for trading (Note 9) 123.087.098 224.448.052 - 347.535.150 Associates - 196.165.815 - 196.165.815 Subsidiaries - 3.196.742 - 3.196.742 Total financial assets 1.041.760.753 643.324.924 67.311.993 1.752.397.670 Tangible assets: Investment properties (Note 6) - 427.026.000 - 427.026.000 Owner occupied properties (Note 6) - 161.310.000 - 161.310.000 Total tangible assets - 588.336.000 - 588.336.000 Total 1.041.760.753 1.231.660.924 67.311.993 2.340.733.670 (*) As of December 31, 2018, securities that are not publicly traded amounting to TL 2.265.431 (December 31, 2017: TL 1.566.075) have been measured at cost. Millî Reasürans Annual Report 2018 Consolidated Financial Statements and Independent Auditors’ Report / 213