TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Consolidated Financial Statements As at and For the Year Ended 31 December 2024 With Independent Auditor’s Audit Report (Convenience translation of consolidated financial statements and related disclosures and footnotes originally issued in Turkish) Güney Bağımsız Denetim ve SMMM A.Ş. Tel: +90 212 315 3000 Maslak Mah. Eski Büyükdere Cad. Fax: +90 212 230 8291 Orjin Maslak İş Merkezi No: 27 ey.com Daire: 57 34485 Sarıyer Ticaret Sicil No : 479920 İstanbul - Türkiye Mersis No: 0-4350-3032-6000017 Convenience Translation of the Auditor’s Audit Report Originally Issued in Turkish Independent Auditors’ Report on Audit of Consolidated Financial Statements To the General Assembly of Türkiye Kalkınma ve Yatırım Bankası A.Ş. Opinion We have audited the consolidated statement of financial position of Türkiye Kalkınm ve Yatırım Bankası A.Ş. (“the Bank”) and its subsidiaries (collectively referred as “Group”) as of December 31, 2024 and the related consolidated statement of profit or loss, consolidated statement of profit or loss and other comprehensive income, consolidated statement of changes in shareholders’ equity, consolidated statement of cash fl ows and a summary of significant accounting policies and other explanatory notes to the consolidated financial statements. In our opinion the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as of December 31, 2024 and consolidated financial performance and consolidated cash flows for the year then ended in accordance with the Banking Regulation and Supervision Agency (“BRSA”) Accounting and Financial Reporting Legislation which includes “Regulation on Accounting Applications for Banks and Safeguarding of Documents” published in the Officia l Gazette no.26333 dated November 1, 2006, and other regulations on accounting records of Banks published by Banking Regulation and Supervision Agency and circulars and interpretations published by BRSA and Turkish Financial Reporting Standards (“TFRS”) for those matters not regulated by the aforementioned regulations. Basis for Opinion Our audit was conducted in accordance with “Regulation on independent audit of the Banks” published in the Official Gazette no.29314 dated April 2, 2015, by BRSA (BRSA Independent Audit Regulation) and Independent Auditing Standards (“ISA”) which are the part of Turkish Auditing Standards issued by the Public Oversight Accounting and Auditing Standards Authority (“POA”). Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Group in accordance with of Code of Ethics for Independent Auditors (Code of Ethics) published by POA and have fulfilled our other responsibilities in accordance with the code of ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Other Matter As of December 31, 2023, the consolidated financial statements of the Group, prepared in accordance with the "BRSA Accounting and Financial Reporting Legislation", were audited by another audit firm. The independent audit firm expressed an unqualified opinion in its independent audit report dated February 8, 2024. Key Audit Matters Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the consolidated financial statements of the current period. Key audit matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. A member firm of Ernst & Young Global Limited Key Audit Matter How the Key Audit Matter is addressed in our audit Financial impact of TFRS 9 “Financial Instruments” standard and recognition of classification, measurement and impairment on financial assets and related important disclosures As presented in Section 3,disclosure numbered IX, the Our audit procedures included among others include: Group recognizes expected credit losses of financial - Evaluating the appropriateness of accounting assets in accordance with TFRS 9 Financial policies as to the requirements of TFRS 9, Group’s Instruments standard. We considered impairment of past experience, local and global practices financial assets as a key audit matter since: - Reviewing and testing of processes which are used to calculate expected credit losses by involving our - Amount of on and off-balance sheet items that are Information technology and process audit specialists subject to expected credit loss calculation is - Evaluation of the reasonableness and material to the financial statements appropriateness of key judgments and estimates - There are complex and comprehensive determined by management and the methods, requirements of TFRS 9 judgments and data sources used in calculating expected loss, taking into account standard - The classification of the financial assets is based on requirements, industry and global practices the Group’s business model and characteristics of - Reviewing the appropriateness of criteria in order to the contractual cash flows in accordance with identify the financial assets having solely payments TFRS 9 and significant judgment is used on the of principal and interest and checking the assessment of the business model and compliance to the Group’s Business model identification of the complex contractual cash flow - Reviewing the Group’s classification and characteristics of financial instruments measurement models of the financial instruments and comparing with TFRS 9 requirements - Policies implemented by the management include - Evaluating the alignment of the significant increase compliance risk to the regulations and other in credit risk determined during the calculation of practices expected credit losses, default definition, restructuring definition, probability of default, loss - Processes of TFRS 9 are advanced and complex given default, exposure at default and macro- economic variables that are determined by the - Judgements and estimates used in expected credit financial risk management experts with the Group’s loss, complex and comprehensive past performance, regulations, and other processes that has forward looking estimations Disclosure requirements of TFRS 9 are - Assessing the completeness and the accuracy of the comprehensive and complex. data used for expected credit loss calculation. - Testing the mthematical accuracy of expected credit loss calculation on sample basis - Evaluating the necessity and accuracy of the updates made or required updates after the modeling process - Auditing of TFRS 9 disclosures. 2 A member firm of Ernst & Young Global Limited Responsibilities of Management and Directors for the Consolidated Financial Statements Group management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the BRSA Accounting and Reporting Legislation and for such internal control as management determines is necessary to enable the preparation of the financial statement that is free from material misstatement, whether due to fraud or error. In preparing the consolidated financial statements, management is responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so. Those charged with governance are responsible for overseeing the Group’s financial reporting process. Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements In an independent audit, the responsibilities of us as independent auditors are: Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with BRSA Independent Audit Regulation and ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. As part of an audit in accordance with BRSA Independent Audit Regulation and ISAs, we exercise professional judgement and maintain professional skepticism throughout the audit. We also: - Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion(The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control). - Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control. - Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management. - Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern. 3 A member firm of Ernst & Young Global Limited - Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. Obtain sufficient appropriate audit evidence regarding the financial information of the entities and business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the Group audit. We remain solely responsible for our audit opinion. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. We also provide those charged with government with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards. From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. Report on Other Legal and Regulatory Requirements 1) In accordance with Article 402 paragraph 4 of the Turkish Commercial Code (“TCC”) no 6102; no significant matter has come to our attention that causes us to believe that the Bank’s bookkeeping activities and financial statements for the period January 1 – December 31, 2024, are not in compliance with the TCC and provisions of the Bank’s articles of association in relation to financial reporting. 2) In accordance with Article 402 paragraph 4 of the TCC; the Board of Directors submitted to us the necessary explanations and provided required documents within the context of audit. The engagement partner who supervised and concluded this independent auditor’s report is Aykut Üşenti. Güney Bağımsız Denetim ve Serbest Muhasebeci Mali Müşavirlik Anonim Şirketi A member firm of Ernst & Young Global Limited Aykut Üşenti, SMMM Partner February 6, 2025 Istanbul, Türkiye 4 A member firm of Ernst & Young Global Limited SECTION ONE General Information I. Establishment Date of the Parent Bank, Initial Articles of Association, History of the Parent Bank Including the Changes of These Articles 1 II. Capital Structure of the Parent Bank, Shareholders that Retain Direct or Indirect Control and Management of the Parent Bank Solely or Together, Changes about These Issues During the Year and Disclosures about the Group 1 III. Explanations Regarding the Parent Bank’s Chairman and Members of Board of Directors, Audit Committee Members, Chief Executive Officer and Executive Vice Presidents and Their Shares Attributable to the Parent Bank, if any 2 Information about Persons and Institutions that Have Qualified Shares Attributable to the Parent 3 IV. Bank V. Summary of Functions and Lines of Activities of the Parent Bank 3 VI. Information on Application Differences Between Consolidation Practices as per the Regulation on Preparation of Consolidated Financial Statements of Banks and the Turkish Accounting Standards, and Entities Subject to Full or Proportional Consolidation or Deducted From Equity or Not Subject to Any of These Three Methods 3 VII. Current or Likely Actual or Legal Barriers to Immediate Transfer of Equity or Repayment of Debts between the Parent Bank and Its Subsidiaries 3 SECTION TWO Consolidated Financial Statements I. Consolidated Balance Sheet (Statement of Financial Position) 5-6 II. Consolidated Statement of Off-Balance Sheet Accounts 7 III. Consolidated Statement of Profit or Loss 8 IV. Consolidated Statement of Profit or Loss and Other Comprehensive Income 9 V. Consolidated Statement of Changes in Shareholders’ Equity 10 VI. Consolidated Statement of Cash Flows 11 V. Statement of Profit Distribution 12 SECTION THREE Accounting Policies I. Explanations on Basis of Presentation 13 II. Basis of Valuation Used in the Preparation of Consolidated Financial Statements 14 III. Explanations on Utilization Strategy of Financial Instruments and Foreign Currency Transactions 14-15 IV. Explanations on Consolidated Partnerships 15 Representation of Affiliates, Subsidiaries and Jointly Controlled Partners not Included in 16 V. Consolidation in the Consolidated Financial Statements VI. Explanations on Futures, Option Contracts and Derivative Instruments 16 VII. Explanations on Interest Income and Expenses 16 VIII. Explanations on Fees and Commission Income and Expenses 16 IX . Explanations on Financial Assets 17-20 X. Explanations on Impairment of Financial Assets 20-23 XI. Explanations on Offsetting of Financial Assets and Liabilities 24 XII. Explanations on Sales and Repurchase Agreements and Lending of Securities 24 XIII. Explanations on Fixed Assets Held for Sale and Discontinued Operations and Related Liabilities 24 XIV. Explanations on Goodwill and Other Intangible Assets 25 XV. Explanations on Tangible Fixed Assets 25 XVI. Explanations on Leasing Transactions 26 XVII. Explanations on Provisions and Contingent Liabilities 26 XVIII. Explanations on Employee Benefit Liabilities 27 XIX. Explanations on Taxation 27-29 XX. Additional Explanations on Borrowings 30 XXI. Explanations on Shares Issued 30 XXII. Explanations on Bill Guarantees and Acceptances 30 XXIII. Explanations on Government Incentives 30 XXIV. Earnings Per Share 30-31 XXV. Related Parties 31 XXVI. Explanations on Segment Reporting 31-32 SECTION FOUR Consolidated Information on Financial Structure and Risk Management I. Explanations Related to Consolidated Equity 33-43 II. Explanations Related to Consolidated Credit Risk 44-53 III. Explanations Related to Consolidated Currency Risk 54-56 IV. Explanations Related to Consolidated Interest Rate Risk 57-60 V. Explanations Related to Consolidated Position Risk of Equity Securities 61 VI. Explanations Related to Consolidated Liquidity Risk Management and Liquidity Coverage Ratio and Net Stable Funding Ratio 61-70 VII. Explanations Related to Consolidated Leverage Ratio 71 VIII. Explanations on the Presentation of Financial Assets and Liabilities at Fair Values 72-74 IX. Explanations on the Transactions Made on Behalf of Others and Items Held in Trust 74 X. Explanations Related to Consolidated Risk Management 74-106 SECTION FIVE Explanations and Notes Related to the Consolidated Financial Statements I. Explanations and Notes Related to Consolidated Assets 107-122 II. Explanations and Notes Related to Consolidated Liabilities 123-128 III. Explanations and Notes Related to Consolidated Off-Balance Sheet Accounts 129-130 IV. Explanations and Notes Related to Statement of Consolidated Profit or Loss 131-135 V. Explanations and Notes Related to Consolidated Statement of Changes in Shareholders’ Equity 136 VI. Explanations and Notes Related to Consolidated Statement of Cash Flows 136-137 VII. Explanations Related to Risk Group of the Parent Bank 138 VIII. Explanations Related to Domestic, Foreign, Off-shore Branches and Representative Offices Abroad 138 SECTION SIX Other Explanations I. Other Explanations Related to Operations of the Bank 139 II. Explanations and Notes Related to Subsequent Events 139 SECTION SEVEN Independent Auditor’s Report I. Explanations on Independent Auditors’ Report 140 II. Explanations and Notes Prepared by Independent Auditor 140 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION ONE GENERAL INFORMATION I. Establishment Date of the Parent Bank, Initial Articles of Association, History of the Bank Including the Changes of These Articles: The Parent Bank was established on 27 November 1975 according to the Decree Based on Law numbered 13 as a related institution of the Ministry of Trade and Technology with the legal title of ‘Devlet Sanayi ve İşçi Yatırım Bankası A.Ş.’. Some adjustments were made on the status of the Bank with the Decree Based on Law numbered 165 dated 14 November 1983. On 15 July 1988, its legal title was changed to Türkiye Kalkınma Bankası A.Ş. by being associated to the Prime Ministry in the context of the Decree Law numbered 329 and in parallel with the developments in its activities. The Bank had become a development and investment bank that provides financing support to companies in tourism sector as well as trade sector by taking over T.C. Turizm Bankası A.Ş. with all of its assets and liabilities with the decision of Supreme Planning Council dated 20 January 1989 and numbered 89/T-2. Also with the Decree Law numbered 401 dated 12 February 1990, some of the articles related to the Bank status were changed. With the Law dated 14 October 1999 and numbered 4456, Decree Law numbered 13, 165, 329 and 401 were revoked and the establishment and operating principles of the Bank were rearranged. Türkiye Kalkınma ve Yatırım Bankası A.Ş. Law dated 24 October 2018 and numbered 7147 was abolished and the Law dated 14 October 1999 and numbered 4456 was revoked. The Bank’s name was changed to Türkiye Kalkınma ve Yatırım Bankası A.Ş with the law numbered 7147. II. Capital Structure of the Parent Bank, Shareholders that Retain Direct or Indirect Control and Management of the Bank Solely or Together, Changes about These Issues During the Year and Disclosures about the Group: The capital ceiling of the Parent Bank which is subject to registered capital system is TL 10.000.000. The issued capital within the registered capital is TL 5.500.000 (The Parent Bank’s capital consists of 550 billion shares with par value of TL 0,01 each), and the shareholders and their shares in the issued capital are shown below: Share Amount Paid-in Capital Unpaid Capital Shareholders (Thousand TL) Share (%) (Thousand TL) (Thousand TL) Republic of Türkiye Ministry of Treasury and Finance 5.449.484 99,08 5.449.484 - Other Shareholders(*) 50.516 0,92 50.516 - Total 5.500.000 100,00 5.500.000 - (*) Includes all institutions and individuals and shares of these shareholders are traded in Borsa İstanbul. Therefore, number of shareholders can’t be known. 1 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION ONE (Continued) GENERAL INFORMATION (Continued) III. Explanations Regarding the Parent Bank’s Chairman and Members of Board of Directors, Audit Committee Members, Chief Executive Officer and Executive Vice Presidents and Their Shares Attributable to the Parent Bank, if any: Chairman and Members of the Board of Directors: Experience in Banking Assignment Sector Name Surname Duty Date Education Level (Years) Dr. Raci KAYA Chairman of the Board 09.11.2020 Doctorate 34 Ömer KARADEMİR Deputy Chairman of the Board 25.03.2022 Master’s Degree 18 İbrahim H. ÖZTOP CEO and Board Member 13.12.2018 Master’s Degree 28 Erdal ERDEM Board Member 10.07.2020 Bachelor’s Degree 29 Zeynep BOĞA Board Member 04.08.2023 Master’s Degree 19 Zekeriya ÇOŞTU Board Member 04.08.2023 Master’s Degree 17 Kerem DÖNMEZ Board Member 04.08.2023 Master’s Degree 17 General Manager, Executive Vice Presidents: Experience in Banking Assignment Education Sector Name Surname Duty Date Level (Years) General Manager / Information Security, Master’s İbrahim H. ÖZTOP Legal Affairs, CEO Office Directorate and all 16.08.2018 28 Degree other areas EVP / Subsidiaries and Corporate Relations, Credit Portfolio Management and Bachelor’s Satı BALCI Monitoring(*), Loan Operations, Treasury 07.11.2017 36 Degree and Capital Markets Operations, Türkiye Development Fund EVP / Financial Analysis and Valuation, Engineering, Economic Research, Sectoral Research, Mergers and Acquisition Advisory, Bachelor’s Seçil KIZILKAYA YILDIZ 08.03.2019 25 Capital Markets Advisory, Financial Degree Advisory, Sustainability and Environmental Social Impact Management EVP / Treasury, Development Finance ve Master’s Emine Özlem CİNEMRE Financial Institutions, Development 20.05.2019 37 Degree Cooperation and Wholesale Banking EVP / IT Application Development, IT Master’s Ali YUNUSLAR System and Infrastructure, Enterprise 08.02.2022 24 Degree Architecture and Project Management EVP / Corporate Banking and Project Finance, Bachelor’s Yeşim ŞİMŞEK 06.06.2022 35 Corporate Banking Sales Degree Master’s Muzaffer Gökhan SONGÜL EVP / Loan Allocation 05.09.2022 21 Degree EVP / Human Resources, Support Services, Financial Affairs, Strategy and Organization, Master’s Nuri Yasin KÜLAHÇI 18.10.2022 19 Budget and Cost Management, Corporate Degree Communications(**) (*) With the decision of the Bank's Board of Directors dated 30 September 2024, the Loan Monitoring Unit was assigned to Executive Vice President Satı BALCI, with the decision dated 6 November 2024, the name of the unit was changed to Credit Portfolio Management and Monitoring. (**) With the decision of the Bank's Board of Directors dated 16 October 2024, the Corporate Communications Unit was assigned to Executive Vice President Nuri Yasin KÜLAHÇI. Chief Internal Inspector: Experience in Assignment Education Banking Sector Name Surname Duty Date Level (Years) Dr. Kaan Ramazan Chief Internal Inspector 27.05.2019 Doctorate 21 ÇAKALI Executives mentioned above do not own any shares of the Bank in the part which is not publicly traded. 2 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION ONE (Continued) GENERAL INFORMATION (Continued) IV. Information About Persons and Institutions that Have Qualified Shares Attributable to the Parent Bank: Republic of Türkiye Ministry of Treasury and Finance owns 99,08% of the shares of the Parent Bank. V. Summary of Functions and Lines of Activities of the Parent Bank: As an investment and development bank of Türkiye Kalkınma ve Yatırım Bankası A.Ş.’s operating areas are supporting investments and projects for sustainable growth, ensuring the efficient use of capital and fund resources, financing domestic, international and international joint investments, and profit partnership or lease-based loan transactions by using modern development and investment banking tools in line with our country’s development goals, to ensure that all development and investment banking functions can be performed in a competitive, dynamic and effective manner. As of 31 December 2024, the Bank has 1 branch operating in Ankara. VI. Information on Application Differences Between Consolidation Practices as per the Regulation on Preparation of Consolidated Financial Statements of Banks and the Turkish Accounting Standards, and Entities Subject to Full or Proportional Consolidation or Deducted From Equity or Not Subject to Any of These Three Methods: The Parent Bank has acquired a 100% stake in Kalkınma Yatırım Varlık Kiralama Anonim Şirketi , established on 28 May 2020, with a nominal capital of TL 50, and in Kalkınma Girişim Sermayesi Portföy Yönetimi Anonim Şirketi, established on 17 November 2020, with an initial nominal capital of TL 1.800, which was subsequently increased to TL 50.000 on 19 August 2024. In accordance with the Communiqué on the Preparation of Consolidated Financial Statements of Banks and the Turkish Accounting Standards, Kalkınma Girişim Sermayesi Portföy Yönetimi Anonim Şirketi and Kalkınma Yatırım Varlık Kiralama Anonim Şirketi are cons olidated in the consolidated financial statements by full consolidation method. According to the Paragraph 4th of Article 6th of Law dated 24 October 2018 and numbered 7147 about Türkiye Kalkınma ve Yatırım Bankası A.Ş., the Bank is not subject to the provisions of the Consolidated Audit and Consolidated Financial Reporting in Banking Law No. 5411 and in the relevant legislation due to its shares in Türkiye Kalkınma Fonu of which the Bank is the founder. Since the Parent Bank’s associates are not financial institutions, they are not consolidated using the equity method in the consolidated financial statements within the scope of the Communiqué on the Preparation of Consolidated Financial Statements of Banks. VII. Current or Likely Actual or Legal Barriers to Immediate Transfer of Equity or Repayment of Debts Between the Bank and Its Subsidiaries: None. 3 SECTION TWO CONSOLIDATED FINANCIAL STATEMENTS I. Consolidated Balance Sheet (Statement of Financial Position) II. Consolidated Statement of Off-Balance Sheet Accounts III. Consolidated Statement of Profit or Loss IV. Consolidated Statement of Profit or Loss and Other Comprehensive Income V. Consolidated Statement of Changes in Shareholders’ Equity VI. Consolidated Statement of Cash Flows VII. Statement of Profit Distribution 4 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Consolidated Balance Sheet (Statement of Financial Position) as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) I. CONSOLIDATED BALANCE SHEET (STATEMENT OF Audited Audited FINANCIAL POSITION) Note Current Period Prior Period (Section (Section 31 December 2024 31 December 2023 ASSETS Five I) TL FC TOTAL TL FC TOTAL I. FINANCIAL ASSETS (NET) (1) 25.339.691 23.655.695 48.995.386 22.306.290 15.543.948 37.850.238 1.1 Cash and Cash Equivalents 20.977.201 1.659.543 22.636.744 20.801.443 1.171.009 21.972.452 1.1.1 Cash and Balances with Central Bank 1.842 - 1.842 2.560 - 2.560 1.1.2 Banks 11.058.573 1.659.543 12.718.116 3.768.650 1.171.009 4.939.659 1.1.3 Money Markets 9.921.861 - 9.921.861 17.046.025 - 17.046.025 1.1.4 Expected Credit Loss (-) (5.075) - (5.075) (15.792) - (15.792) 1.2 Financial Assets Measured at Fair Value Through Profit or Loss 416.293 280.704 696.997 318.816 272.639 591.455 1.2.1 Government Securities - - - - - - 1.2.2 Equity Securities 416.293 280.704 696.997 318.816 272.639 591.455 1.2.3 Other Financial Assets - - - - - - 1.3 Financial Assets Measured at Fair Value Through Other Comprehensive Income 3.802.055 21.715.448 25.517.503 1.120.503 14.100.112 15.220.615 1.3.1 Government Securities 3.201.141 5.848.330 9.049.471 868.246 7.758.688 8.626.934 1.3.2 Equity Securities 8.813 - 8.813 18.362 - 18.362 1.3.3 Other Financial Assets 592.101 15.867.118 16.459.219 233.895 6.341.424 6.575.319 1.4 Derivative Financial Assets (1,5) 144.142 - 144.142 65.528 188 65.716 1.4.1 Derivative Financial Assets Measured at Fair Value Through Profit or Loss 144.142 - 144.142 65.528 188 65.716 1.4.2 Derivative Financial Assets Measured at Fair Value Through Other Comprehensive Income - - - - - - II. FINANCIAL ASSETS MEASURED AT AMORTISED COST (NET) (2) 30.909.812 72.576.250 103.486.062 25.811.677 71.399.398 97.211.075 2.1 Loans 22.773.031 72.039.804 94.812.835 19.333.681 64.825.027 84.158.708 2.2 Lease Receivables - - - - - - 2.3 Factoring Receivables - - - - - - 2.4 Other Financial Assets Measured at Amortised Cost 9.865.929 536.446 10.402.375 7.900.966 6.574.371 14.475.337 2.4.1 Government Securities 9.865.929 536.446 10.402.375 7.046.016 6.513.924 13.559.940 2.4.2 Other Financial Assets - - - 854.950 60.447 915.397 2.5 Expected Credit Loss (-) (1.729.148) - (1.729.148) (1.422.970) - (1.422.970) III. ASSETS HELD FOR SALE AND ASSETS OF DISCONTINUED (3) OPERATIONS (Net) - - - - - - 3.1 Held for Sale Purpose - - - - - - 3.2 Related to Discontinued Operations - - - - - - IV. EQUITY INVESTMENTS (4) 10.586 - 10.586 10.586 - 10.586 4.1 Associates (Net) 10.586 - 10.586 10.586 - 10.586 4.1.1 Associates Accounted Based on Equity Method - - - - - - 4.1.2 Unconsolidated Financial Subsidiaries 10.586 - 10.586 10.586 - 10.586 4.2 Subsidiaries (Net) - - - - - - 4.2.1 Unconsolidated Financial Subsidiaries - - - - - - 4.2.2 Unconsolidated Non-Financial Subsidiaries - - - - - - 4.3 Joint Ventures (Net) - - - - - - 4.3.1 Joint Ventures Accounted Based on Equity Method - - - - - - 4.3.2 Unconsolidated Joint Ventures - - - - - - V. TANGIBLE ASSETS (Net) (6) 74.745 - 74.745 43.010 - 43.010 VI. INTANGIBLE ASSETS (Net) (7) 52.182 - 52.182 32.323 - 32.323 6.1 Goodwill - - - - - - 6.2 Other 52.182 - 52.182 32.323 - 32.323 VII. INVESTMENT PROPERTY (Net) (8) - - - - - - VIII. CURRENT TAX ASSET (9) 9 - 9 5 - 5 IX. DEFERRED TAX ASSET (10) 479.355 - 479.355 324.243 - 324.243 X. OTHER ASSETS (Net) 256.215 239.929 496.144 68.742 159.464 228.206 TOTAL ASSETS 57.122.595 96.471.874 153.594.469 48.596.876 87.102.810 135.699.686 The accompanying explanations and notes form an integral part of these consolidated financial statements 5 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Consolidated Balance Sheet (Statement of Financial Position) as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) I. CONSOLIDATED BALANCE SHEET (STATEMENT OF Audited Audited FINANCIAL POSITION) Note Current Period Prior Period (Section 31 December 2024 31 December 2023 LIABILITIES Five II) TL FC TOTAL TL FC TOTAL I. DEPOSITS (1) - - - - - - II. FUNDS BORROWED (2) 21.904.450 86.380.401 108.284.851 17.995.416 79.951.624 97.947.040 III. MONEY MARKET FUNDS (3) 3.415.017 2.099 3.417.116 2.874.989 - 2.874.989 IV. SECURITIES ISSUED (Net) (4) - 3.735.924 3.735.924 854.950 3.321.427 4.176.377 4.1 Bills - - - - - - 4.2 Asset Backed Securities - - - 854.950 - 854.950 4.3 Bonds - 3.735.924 3.735.924 - 3.321.427 3.321.427 V. FUNDS (5) 2.254.778 6.147.855 8.402.633 2.676.239 3.721.694 6.397.933 5.1 Borrower Funds 1.505.796 3.507.329 5.013.125 325.241 2.584.491 2.909.732 5.2 Other 748.982 2.640.526 3.389.508 2.350.998 1.137.203 3.488.201 VI. FINANCIAL LIABILITIES AT FAIR VALUE THROUGH PROFIT OR LOSS (6) - - - - - - VII. DERIVATIVE FINANCIAL LIABILITIES (7,10) 17.382 3.507 20.889 15.195 3.104 18.299 7.1 Derivative Financial Liabilities at Fair Value Through Profit or Loss 17.382 3.507 20.889 15.195 3.104 18.299 7.2 Derivative Financial Liabilities at Fair Value Through Other Comprehensive Income - - - - - - VIII. FACTORING LIABILITES (8) - - - - - - IX. LEASE LIABILITIES (Net) (9) 22.348 - 22.348 21.326 - 21.326 X. PROVISIONS (11) 605.012 - 605.012 433.171 - 433.171 10.1 Restructuring Provisions - - - - - - 10.2 Reserve for Employee Benefits 479.145 - 479.145 271.094 - 271.094 10.3 Insurance Technical Provisions (Net) - - - - - - 10.4 Other Provisions 125.867 - 125.867 162.077 - 162.077 XI. CURRENT TAX LIABILITY (12) 816.578 - 816.578 547.485 - 547.485 XII. DEFERRED TAX LIABILITY (13) - - - - - - XIII. LIABILITIES FOR PROPERTY AND EQUIPMENT HELD FOR (14) SALE AND RELATED TO DISCONTINUED OPERATIONS (Net) - - - - - - 13.1 Held for Sale Purpose - - - - - - 13.2 Related to Discontinued Operations - - - - - - XIV. SUBORDINATED DEBT INSTRUMENTS (15) 5.516.800 2.060.311 7.577.111 3.712.899 7.865.824 11.578.723 14.1 Borrowings 5.516.800 2.060.311 7.577.111 3.712.899 7.865.824 11.578.723 14.2 Other Debt Instruments - - - - - - XV. OTHER LIABILITIES (16) 591.609 114.998 706.607 476.658 345.013 821.671 XVI. SHAREHOLDERS’ EQUITY (17) 19.913.949 91.451 20.005.400 10.795.322 87.350 10.882.672 16.1 Paid-in capital 5.500.000 - 5.500.000 2.500.000 - 2.500.000 16.2 Capital Reserves 211.495 - 211.495 210.112 - 210.112 16.2.1 Share Premium 5.421 - 5.421 4.038 - 4.038 16.2.2 Share Cancellation Profits - - - - - - 16.2.3 Other Capital Reserves 206.074 - 206.074 206.074 - 206.074 16.3 Accumulated Other Comprehensive Income or Loss that will not be Reclassified to Profit or Loss 2.483 - 2.483 (506) - (506) 16.4 Accumulated Other Comprehensive Income or Loss that will be Reclassified to Profit or Loss 11.484 91.451 102.935 72.986 87.350 160.336 16.5 Profit Reserves 8.012.952 - 8.012.952 3.969.773 - 3.969.773 16.5.1 Legal Reserves 422.617 - 422.617 220.440 - 220.440 16.5.2 Status Reserves - - - - - - 16.5.3 Extraordinary Reserves 7.536.109 - 7.536.109 3.695.073 - 3.695.073 16.5.4 Other Profit Reserves 54.226 - 54.226 54.260 - 54.260 16.6 Profit or (Loss) 6.175.535 - 6.175.535 4.042.957 - 4.042.957 16.6.1 Prior Periods' Profit or (Loss) - - - 289 - 289 16.6.2 Current Period Profit or (Loss) 6.175.535 - 6.175.535 4.042.668 - 4.042.668 16.7 Minority Shares - - - - - - TOTAL LIABILITIES 55.057.923 98.536.546 153.594.469 40.403.650 95.296.036 135.699.686 The accompanying explanations and notes form an integral part of these consolidated financial statements. 6 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Consolidated Statement of Off-Balance Sheet Accounts as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) Audited Audited II. CONSOLIDATED STATEMENT OF OFF-BALANCE SHEET Note Current Period Prior Period ACCOUNTS (Section 31 December 2024 31 December 2023 Five III) TL FC Total TL FC Total A. OFF-BALANCE SHEET COMMITMENTS (I+II+III) 10.610.912 32.631.385 43.242.297 11.876.311 24.568.607 36.444.918 I. GUARANTEES AND WARRANTIES (1) 149.197 4.925.973 5.075.170 84.924 4.669.416 4.754.340 1.1 Letters of Guarantee 149.197 4.159.253 4.308.450 84.924 4.060.156 4.145.080 1.1.1 Guarantees Subject to State Tender Law - - - - - - 1.1.2 Guarantees Given for Foreign Trade Operations 1 - 1 1 - 1 1.1.3 Other Letters of Guarantee 149.196 4.159.253 4.308.449 84.923 4.060.156 4.145.079 1.2 Bank Acceptances - - - - - - 1.2.1 Import Letter of Acceptance - - - - - - 1.2.2 Other Bank Acceptances - - - - - - 1.3 Letters of Credit - 133.709 133.709 - - - 1.3.1 Documentary Letters of Credit - 133.709 133.709 - - - 1.3.2 Other Letters of Credit - - - - - - 1.4 Prefinancing Given as Guarantee - - - - - - 1.5 Endorsements - - - - - - 1.5.1 Endorsements to the Central Bank of the Republic of Türkiye - - - - - - 1.5.2 Other Endorsements - - - - - - 1.6 Purchase Guarantees on Marketable Security Issuance - - - - - - 1.7 Factoring Guarantees - - - - - - 1.8 Other Guarantees - 633.011 633.011 - 609.260 609.260 1.9 Other Collaterals - - - - - - II. COMMITMENTS (1,3) 3.895.049 15.540.909 19.435.958 1.656.171 7.929.901 9.586.072 2.1 Irrevocable Commitments 318.549 646.801 965.350 390.901 1.292.430 1.683.331 2.1.1 Asset Purchase and Sale Commitments 72.489 120.074 192.563 127.990 1.292.376 1.420.366 2.1.2 Deposit Purchase and Sales Commitments - - - - - - 2.1.3 Share Capital Commitments to Associates and Subsidiaries - - - - - - 2.1.4 Loan Granting Commitments - - - - - - 2.1.5 Securities Issue Brokerage Commitments - - - - - - 2.1.6 Commitments for Reserve Deposit Requirements - - - - - - 2.1.7 Commitments for Cheques - - - - - - 2.1.8 Tax and Fund Liabilities from Export Commitments - - - - - - 2.1.9 Commitments for Credit Card Limits - - - - - - 2.1.10 Commitments for Credit Cards and Banking Services Promotions - - - - - - 2.1.11 Receivables from Short Sale Commitments of Marketable Securities - - - - - - 2.1.12 Payables for Short Sale Commitments of Marketable Securities - - - - - - 2.1.13 Other Irrevocable Commitments 246.060 526.727 772.787 262.911 54 262.965 2.2 Revocable Commitments 3.576.500 14.894.108 18.470.608 1.265.270 6.637.471 7.902.741 2.2.1 Revocable Loan Granting Commitments 3.576.500 14.894.108 18.470.608 1.265.270 6.637.471 7.902.741 2.2.2 Other Revocable Commitments - - - - - - III. DERIVATIVE FINANCIAL INSTRUMENTS (2) 6.566.666 12.164.503 18.731.169 10.135.216 11.969.290 22.104.506 3.1 Hedging Derivative Financial Instruments - - - - - - 3.1.1 Transactions for Fair Value Hedge - - - - - - 3.1.2 Transactions for Cash Flow Hedge - - - - - - 3.1.3 Transactions for Foreign Net Investment Hedge - - - - - - 3.2 Trading Transactions 6.566.666 12.164.503 18.731.169 10.135.216 11.969.290 22.104.506 3.2.1 Forward Foreign Currency Buy/Sell Transactions - - - - - - 3.2.1.1 Forward Foreign Currency Transactions-Buy - - - - - 3.2.1.2 Forward Foreign Currency Transactions-Sell - - - - - 3.2.2 Swap Transactions Related to Foreign Currency and Interest Rates 6.566.666 12.164.503 18.731.169 10.135.216 11.969.290 22.104.506 3.2.2.1 Foreign Currency Swap-Buy 2.307.407 7.105.124 9.412.531 982.007 10.034.857 11.016.864 3.2.2.2 Foreign Currency Swap-Sell 4.259.259 5.059.379 9.318.638 9.153.209 1.934.433 11.087.642 3.2.2.3 Interest Rate Swap-Buy - - - - - - 3.2.2.4 Interest Rate Swap-Sell - - - - - - 3.2.3 Foreign Currency, Interest rate and Securities Options - - - - - - 3.2.3.1 Foreign Currency Options-Buy - - - - - - 3.2.3.2 Foreign Currency Options-Sell - - - - - - 3.2.3.3 Interest Rate Options-Buy - - - - - - 3.2.3.4 Interest Rate Options-Sell - - - - - - 3.2.3.5 Securities Options-Buy - - - - - - 3.2.3.6 Securities Options-Sell - - - - - - 3.2.4 Foreign Currency Futures - - - - - - 3.2.4.1 Foreign Currency Futures-Buy - - - - - - 3.2.4.2 Foreign Currency Futures-Sell - - - - - - 3.2.5 Interest Rate Futures - - - - - - 3.2.5.1 Interest Rate Futures-Buy - - - - - - 3.2.5.2 Interest Rate Futures-Sell - - - - - - 3.2.6 Other - - - - - - B. CUSTODY AND PLEDGES RECEIVED (IV+V+VI) 131.260.731 549.735.253 680.995.984 131.922.770 446.065.549 577.988.319 IV. ITEMS HELD IN CUSTODY 135.670 - 135.670 118.371 - 118.371 4.1 Customer Fund and Portfolio Balances - - - - - - 4.2 Investment Securities Held in Custody 135.670 - 135.670 118.371 - 118.371 4.3 Checks Received for Collection - - - - - - 4.4 Commercial Notes Received for Collection - - - - - - 4.5 Other Assets Received for Collection - - - - - - 4.6 Assets Received for Public Offering - - - - - - 4.7 Other Items Under Custody - - - - - - 4.8 Custodians - - - - - - V. PLEDGES RECEIVED 131.125.061 549.735.253 680.860.314 131.804.399 446.065.549 577.869.948 5.1 Marketable Securities 3.476.749 654.546 4.131.295 15.655.237 - 15.655.237 5.2 Guarantee Notes - 3.360.450 3.360.450 2.390 4.853.729 4.856.119 5.3 Commodity - - - - - - 5.4 Warranty - - - - - - 5.5 Immovable 121.911.393 514.670.160 636.581.553 110.341.770 413.292.111 523.633.881 5.6 Other Pledged Items 5.623.575 26.609.300 32.232.875 5.668.808 23.577.339 29.246.147 5.7 Pledged Items-Depository 113.344 4.440.797 4.554.141 136.194 4.342.370 4.478.564 VI. ACCEPTED INDEPENDENT GUARANTEES AND WARRANTIES - - - - - - TOTAL OFF-BALANCE SHEET COMMITMENTS (A+B) 141.871.643 582.366.638 724.238.281 143.799.081 470.634.156 614.433.237 The accompanying explanations and notes form an integral part of these consolidated financial statements. 7 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Consolidated Statement of Profit or Loss for the Period Ended 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) III. CONSOLIDATED STATEMENT OF PROFIT OR LOSS Audited Audited Note Current Period Prior Period (Section INCOME AND EXPENSE ITEMS 1 January- 1 January- Five IV) 31 December 2024 31 December 2023 I. INTEREST INCOME (1) 23.760.711 16.178.890 1.1 Interest on Loans 9.667.343 7.108.531 1.2 Interest on Reserve Requirements - - 1.3 Interest on Banks 3.952.434 2.859.352 1.4 Interest on Money Market Transactions 4.148.014 2.612.351 1.5 Interest on Marketable Securities Portfolio 5.586.303 3.598.585 1.5.1 Fair Value Through Profit or Loss - - 1.5.2 Fair Value Through Other Comprehensive Income 2.186.994 1.076.745 1.5.3 Measured at Amortised Cost 3.399.309 2.521.840 1.6 Financial Lease Interest Income - - 1.7 Other Interest Income 406.617 71 II. INTEREST EXPENSE (-) (2) (12.479.523) (8.653.879) 2.1 Interest on Deposits - - 2.2 Interest on Funds Borrowed (10.112.142) (7.228.677) 2.3 Interest Expense on Money Market Transactions (1.400.717) (528.112) 2.4 Interest on Securities Issued (259.906) (182.028) 2,5 Measured at Amortised Expense (5.454) (3.066) 2.6 Other Interest Expenses (701.304) (711.996) III. NET INTEREST INCOME (I - II) 11.281.188 7.525.011 IV. NET FEES AND COMMISSIONS INCOME 247.242 137.029 4.1 Fees and Commissions Received 287.107 313.988 4.1.1 Non-cash Loans 88.282 90.520 4.1.2 Other (13) 198.825 223.468 4.2 Fees and Commissions Paid (39.865) (176.959) 4.2.1 Non-cash Loans (2) (14) 4.2.2 Other (13) (39.863) (176.945) V. DIVIDEND INCOME (3) 29.035 22.876 VI. TRADING PROFIT / (LOSS) (Net) (4) (797.899) (603.480) 6.1 Trading Gains / (Losses) on Securities 101.323 162.471 6.2 Gains / (Losses) on Derivative Financial Transactions (729.556) 1.986.104 6.3 Foreign Exchange Gains / (Losses) (169.666) (2.752.055) VII. OTHER OPERATING INCOME (5) 436.107 223.334 VIII. GROSS OPERATING INCOME (III+IV+V+VI+VII) 11.195.673 7.304.770 IX. EXPECTED CREDIT LOSS (-) (6) (734.524) (492.037) X. OTHER PROVISION EXPENSE (-) (6) (451.346) (345.475) XI. PERSONNEL EXPENSE (-) (866.444) (460.422) XII. OTHER OPERATING EXPENSES (-) (7) (435.234) (365.833) XIII. NET OPERATING INCOME/(LOSS) (VIII-IX-X-XI-XII) 8.708.125 5.641.003 XIV. EXCESS AMOUNT RECORDED AS INCOME AFTER MERGER - - XV. INCOME/(LOSS) FROM INVESTMENTS IN SUBSIDIARIES CONSOLIDATED BASED ON EQUITY METHOD - - XVI. INCOME/(LOSS) ON NET MONETARY POSITION - - XVII. PROFIT/LOSS BEFORE TAX FROM CONTINUED OPERATIONS (XIII+…+XVI) (9) 8.708.125 5.641.003 XVIII. TAX PROVISION FOR CONTINUED OPERATIONS (±) (10) (2.532.590) (1.598.335) 18.1 Current Tax Provision (2.664.914) (1.762.726) 18.2 Deferred Tax Income Effect (+) - - 18.3 Deferred Tax Expense Effect (-) 132.324 164.391 XIX CURRENT PERIOD PROFIT/LOSS FROM CONTINUED OPERATIONS (11) 6.175.535 4.042.668 (XVII±XVIII) - - XX. INCOME FROM DISCONTINUED OPERATIONS - - 20.1 Income from Non-current Assets Held for Sale - - 20.2 Profit from Sales of Associates, Subsidiaries and Joint Ventures - - 20.3 Income from Other Discontinued Operations - - XXI. EXPENSES FOR DISCONTINUED OPERATIONS (-) - - 21.1 Expenses for Non-current Assets Held for Sale - - 21.2 Loss from Sales of Associates, Subsidiaries and Joint Ventures - - 21.3 Expenses for Other Discontinued Operations - - XXII PROFIT/LOSS BEFORE TAX FROM DISCONTINUED OPERATIONS (XX-XXI) - - XXIII TAX PROVISION FOR DISCONTINUED OPERATIONS (±) - - 23.1 Current Tax Provision - - 23.2 Deferred Tax Expense Effect (+) - - 23.3 Deferred Tax Income Effect (-) - - XXIV CURRENT PERIOD PROFIT/LOSS FROM DISCONTINUED OPERATIONS (XXII±XXIII) - - XXV. NET PROFIT/(LOSS) (XIX+XXIV) (12) 6.175.535 4.042.668 25.1 Group Profit / Loss 6.175.535 4.042.668 25.2 Minority Shares Profit / Loss (-) - - Earning/(Loss) per share (in TL full) 0,014 0,016 The accompanying explanations and notes form an integral part of these consolidated financial statements. 8 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Consolidated Statement of Profit or Loss and Other Comprehensive Income for the Period Ended 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) Audited Audited IV. CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE Current Period Prior Period INCOME 1 January- 1 January- 31 December 2024 31 December 2023 I. CURRENT PERIOD PROFIT/LOSS 6.175.535 4.042.668 II. OTHER COMPREHENSIVE INCOME (54.412) (4.272) 2.1 Not Reclassified to Profit or Loss 2.989 - 2.1.1 Property and Equipment Revaluation Increase/Decrease - - 2.1.2 Intangible Assets Revaluation Increase/Decrease - - 2.1.3 Defined Benefit Pension Plan Remeasurement Gain/Loss 4.202 - 2.1.4 Other Comprehensive Income Items Not Reclassified Through Profit or Loss - - 2.1.5 Tax Related Other Comprehensive Income Items Not Reclassified Through Profit or Loss (1.213) - 2.2 Reclassified to Profit or Loss (57.401) (4.272) 2.2.1 Foreign Currency Translation Differences - - Valuation and/or Reclassification Income/Expense of the Financial Assets at Fair Value through Other 2.2.2 Comprehensive Income (81.402) (4.409) 2.2.3 Cash Flow Hedge Income/Loss - - 2.2.4 Foreign Net Investment Hedge Income/Loss - - 2.2.5 Other Comprehensive Income Items Reclassified Through Profit or Losses - 9.464 2.2.6 Tax Related Other Comprehensive Income Items Reclassified Through Profit or Loss 24.001 (9.327) III. TOTAL COMPREHENSIVE INCOME (I+II) 6.121.123 4.038.396 The accompanying explanations and notes form an integral part of these consolidated financial statements. 9 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Consolidated Statement of Changes in Shareholders’ Equity for the Period Ended 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) V. CONSOLIDATED STATEMENT OF Share Prior Current Total Equity CHANGES IN SHAREHOLDERS' EQUITY Certificate Other Period Net Period Net Excluding Paid-in Share Cancel Capital Profit Income Income Minority Minority Total Capital Premium Profits Reserves Reserves (Loss) (Loss) Shares Shares Equity Other Comprehensive Other Comprehensive Income/Expense Income/Expense Items not to be Reclassified to Profit or Items to be Reclassified to Profit or Loss Loss 1 2 3 4 5 6 Prior Period 31 December 2023 I. Balance at the beginning of the period 2.500.000 4.038 - 206.074 - (506) - - 163.141 1.467 2.277.957 1.701.569 - 6.853.740 - 6.853.740 II. Adjustment in accordance with TAS 8 - - - - - - - - - - - - - - - - 2.1 Effect of adjustment - - - - - - - - - - - - - - - - 2.2 Effect of changes in accounting policies - - - - - - - - - - - - - - - - III. New balance (I+II) 2.500.000 4.038 - 206.074 - (506) - - 163.141 1.467 2.277.957 1.701.569 - 6.853.740 - 6.853.740 IV. Total comprehensive income (loss) - - - - - - - (13.736) 9.464 - - 4.042.668 4.038.396 - 4.038.396 V. Capital increase in cash - - - - - - - - - - - - - - - - VI. Capital increase through internal reserves - - - - - - - - - - - - - - - - VII. Issued capital inflation adjustment difference - - - - - - - - - - - - - - - - VIII Convertible bonds - - - - - - - - - - - - - - - - IX. Subordinated debt - - - - - - - - - - - - - - - - X. Increase (decrease) through other changes, equity - - - - - - - - - - - - - - - - XI. Profit distribution - - - - - - - - - - 1.691.816 (1.701.280) - (9.464) - (9.464) 11.1 Dividends distributed - - - - - - - - - - - - - - - - 11.2 Transfers to legal reserves - - - - - - - - - - 1.691.816 (1.691.816) - - - - 11.3 Other - - - - - - - - - - - (9.464) - (9.464) (9.464) Balances (III+IV+…...+X+XI) 2.500.000 4.038 - 206.074 - (506) - - 149.405 10.931 3.969.773 289 4.042.668 10.882.672 - 10.882.672 Current Period 31 December 2024 I. Balance at the beginning of the period 2.500.000 4.038 - 206.074 - (506) - - 149.405 10.931 3.969.773 4.042.957 - 10.882.672 - 10.882.672 II. Adjustment in accordance with TAS 8 - - - - - - - - - - - - - - - - 2.1 Effect of adjustment - - - - - - - - - - - - - - - - 2.2 Effect of changes in accounting policies - - - - - - - - - - - - - - - - III. New balance (I+II) 2.500.000 4.038 - 206.074 - (506) - - 149.405 10.931 3.969.773 4.042.957 - 10.882.672 - 10.882.672 IV. Total comprehensive income (loss) - - - - 2.989 - - (57.401) - - - 6.175.535 6.121.123 - 6.121.123 V. Capital increase in cash 3.000.000 1.383 - - - - - - - - - - - 3.001.383 - 3.001.383 VI. Capital increase through internal reserves - - - - - - - - - - - - - - - - VII. Issued capital inflation adjustment difference - - - - - - - - - - - - - - - - VIII Convertible bonds - - - - - - - - - - - - - - - - IX. Subordinated debt - - - - - - - - - - - - - - - - X. Increase (decrease) through other changes, equity - - - - - - - - - - (34) 256 - 222 - 222 XI. Profit distribution - - - - - - - - - - 4.043.213 (4.043.213) - - - - 11.1 Dividends distributed - - - - - - - - - - - - - - - - 11.2 Transfers to legal reserves - - - - - - - - - - 4.043.213 (4.043.213) - - - - 11.3 Other - - - - - - - - - - - - - - - - Balances (III+IV+…...+X+XI) 5.500.000 5.421 - 206.074 - 2.483 - - 92.004 10.931 8.012.952 - 6.175.535 20.005.400 - 20.005.400 1. Accumulated revaluation increases/decreases of fixed assets, 2. Accumulated remeasurement gains/losses of defined benefit plans, 3. Other (Shares of other comprehensive income of investments valued by the equity method that will not be reclassified to profit/loss and accumulated amounts of other comprehensive income elements that will not be reclassified to profit or loss) 4. Foreign currency translation differences, 5. Accumulated revaluation and/or reclassification gains/losses of financial assets at fair value through other comprehensive income, 6. Other (represents cash flow hedging gains/losses, shares of other comprehensive income of investments valued by the equity method to be classified in profit/loss, and accumulated amounts of other comprehensive income items to be reclassified as other profit or loss). The accompanying explanations and notes form an integral part of these consolidated financial statements. 10 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Consolidated Statement of Cash Flows for the Period Ended 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) VI. CONSOLIDATED STATEMENT OF CASH FLOWS Audited Audited Note Current Period Prior Period (Section 1 January- 1 January- Five VI) 31 December 2024 31 December 2023 A. CASH FLOWS FROM BANKING OPERATIONS 1.1 Operating Profit Before Changes in Operating Assets and Liabilities (1) 6.906.489 4.041.997 1.1.1 Interest Received 21.839.423 12.839.463 1.1.2 Interest Paid (11.380.719) (5.885.250) 1.1.3 Dividend Received 29.035 22.876 1.1.4 Fees and Commissions Received 287.107 154.721 1.1.5 Other Income 6.937 - 1.1.6 Collections from Previously Written-off Loans and Other Receivables 142.506 141.541 1.1.7 Payments to Personnel and Service Suppliers (1.067.336) (541.332) 1.1.8 Taxes Paid (2.517.428) (1.580.820) 1.1.9 Other (1) (433.036) (1.109.202) 1.2 Changes in Operating Assets and Liabilities (1) (1.060.222) 3.966.737 - 1.2.1 Net (İncrease) / Decrease in Financial Assets at Fair Value Through Profit or Loss (79.766) (142.400) 1.2.2 Net (İncrease) / Decrease in Due From Banks and Other Financial Institutions - - 1.2.3 Net (Increase) / Decrease in Loans 595.226 4.571.645 1.2.4 Net (Increase) / Decrease in Other Assets (188.316) 420.236 1.2.5 Net Increase / (Decrease) in Bank Deposits - - 1.2.6 Net Increase / (Decrease) in Other Deposits - - 1.2.7 Net Increase/ (Decrease) in Financial Liabilities at Fair Value Through Profit or Loss - - 1.2.8 Net Increase / (Decrease) in Funds Borrowed (2.976.406) 2.597.223 1.2.9 Net Increase / (Decrease) in Payables - - 1.2.10 Net Increase / (Decrease) in Other Liabilities (1) 1.589.040 (3.479.967) I. Net Cash Provided from Banking Operations (1) 5.846.267 8.008.734 B. CASH FLOWS FROM INVESTMENT ACTIVITIES II. Net Cash Provided from Investing Activities (2.628.780) (3.900.905) 2.1 Cash Paid for Acquisition of Investments, Associates and Subsidiaries - - 2.2 Cash Obtained from Disposal of Investments, Associates and Subsidiaries - - 2.3 Purchases of Property and Equipment (45.640) (14.733) 2.4 Disposals of Property and Equipment 2.480 421.475 2.5 Purchase of Financial Assets at Fair Value Through Other Comprehensive Income (33.755.416) (22.856.316) 2.6 Sale of Financial Assets at Fair Value Through Other Comprehensive Income 27.058.219 19.831.165 2.7 Purchase of Financial Assets Measured at Amortised Cost (2.738.782) (3.099.315) 2.8 Sale of Financial Assets Measured at Amortised Cost 6.885.548 1.437.495 2.9 Other (35.189) 379.324 C. CASH FLOWS FROM FINANCING ACTIVITIES III. Net Cash Provided from Financing Activities (1) (2.516.919) (17.229) 3.1 Cash Obtained from Funds Borrowed and Securities Issued - - 3.2 Cash Used for Repayment of Funds Borrowed and Securities Issued (5.489.924) - 3.3 Issued Equity Instruments 3.001.383 - 3.4 Dividends Paid - - 3.5 Payments for Finance Leases (28.378) (17.229) 3.6 Other - - IV. Effect of Change in Foreign Exchange Rate on Cash and Cash Equivalents (1) (365.060) 2.022.255 V. Net Decrease/ Increase in Cash and Cash Equivalents (I+II+III+IV) 335.508 6.112.855 VI. Cash and Cash Equivalents at the Beginning of the Period (2) 21.412.207 15.299.352 VII. Cash and Cash Equivalents at the End of the Period (3) 21.747.715 21.412.207 The accompanying explanations and notes form an integral part of these consolidated financial statements. 11 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Statement of Profit Distribution for the Period Ended 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) VII. STATEMENT OF PROFIT DISTRIBUTION Audited Audited Current Period Prior Period 1 January- 1 January- 31 December 2024(*) 31 December 2023(**) I. DISTRIBUTION OF CURRENT YEAR INCOME 1.1 CURRENT YEAR INCOME 8.698.622 5.642.607 1.2 TAXES AND DUTIES PAYABLE(-) (2.531.037) (1.599.232) 1.2.1 Corporate Tax (Income tax) (2.662.920) (1.762.541) 1.2.2 Income witholding tax - - 1.2.3 Other taxes and duties 131.883 163.309 A. NET INCOME FOR THE YEAR (1.1-1.2) 6.167.585 4.043.375 1.3 PRIOR YEARS LOSSES (-) - - 1.4 FIRST LEGAL RESERVES (-) - (202.169) 1.5 OTHER STATUTORY RESERVES (-) - - B. NET INCOME AVAILABLE FOR DISTRIBUTION [(A-(1.3+1.4+1.5)] 6.167.585 3.841.206 1.6 FIRST DIVIDEND TO SHAREHOLDERS (-) - - 1.6.1 To owners of ordinary shares - - 1.6.2 To owners of preferred shares - - 1.6.3 To owners of preferred shares (preemptive rights) - - 1.6.4 To profit sharing bonds - - 1.6.5 To holders of profit and loss sharing certificates - - 1.7 DIVIDENDS TO PERSONNEL (-) - - 1.8 DIVIDENDS TO BOARD OF DIRECTORS (-) - - 1.9 SECOND DIVIDEND TO SHAREHOLDERS (-) - - 1.9.1 To owners of ordinary shares - - 1.9.2 To owners of preferred shares - - 1.9.3 To owners of preferred shares (preemptive rights) - - 1.9.4 To profit sharing bonds - - 1.9.5 To holders of profit and loss sharing certificates - - 1.10 SECOND LEGAL RESERVES (-) - - 1.11 STATUTORY RESERVES (-) - - 1.12 EXTRAORDINARY RESERVES(**) - 3.841.206 1.13 OTHER RESERVES - - 1.14 SPECIAL FUNDS - - II. DISTRIBUTION OF RESERVES 2.1 APPROPRIATED RESERVES - - 2.2 SECOND LEGAL RESERVES (-) - - 2.3 DIVIDENDS TO SHAREHOLDERS (-) - - 2.3.1 To owners of ordinary shares - - 2.3.2 To owners of preferred shares - - 2.3.3 To owners of preferred shares (preemptive rights) - - 2.3.4 To profit sharing bonds - - 2.3.5 To holders of profit and loss sharing certificates - - 2.4 DIVIDENDS TO PERSONNEL (-) - - 2.5 DIVIDENDS TO BOARD OF DIRECTORS (-) - - III. EARNINGS PER SHARE(***) 3.1 TO OWNERS OF ORDINARY SHARES 0,014 0,016 3.2 TO OWNERS OF ORDINARY SHARES (%) 1,4 1,6 3.3 TO OWNERS OF PRIVILEGED SHARES - - 3.4 TO OWNERS OF PRIVILEGED SHARES (%) - - IV. DIVIDEND PER SHARE 4.1 TO OWNERS OF ORDINARY SHARES - - 4.2 TO OWNERS OF ORDINARY SHARES (%) - - 4.3 TO OWNERS OF PRIVILAGED SHARES - - 4.4 TO OWNERS OF PRIVILEGED SHARES ( % ) - - (*) Since the profit distribution proposal for 2024 to be submitted to the General Assembly for approval has not yet been prepared by the Board of Directors, only the distributable profit amount is specified in the 2024 profit distribution statement. (**) The profit of 2023 was transferred to legal reserves and extraordinary reserves with the decision of the General Assembly. (***) Shown with full TL amount. The accompanying explanations and notes form an integral part of these consolidated financial statements. 12 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION THREE ACCOUNTING POLICIES I. Explanations on Basis of Presentation: a. The preparation of financial statements and related notes according to Turkish Accounting Standards and Regulation on the Procedures and Principles for Accounting Practices and Retention of Documents by Banks: As prescribed in the Article 37 of the Banking Act No. 5411, the Bank prepares its financial statements and underlying documents in accordance with the “Regulation on the Procedures and Principles for Accounting Practices and Retention of Documents by Banks’’ and other regulations, explanations and circulars on accounting and financial reporting principles announced by the Banking Regulation and Supervision Agency (“BRSA”) and Turkish Accounting Standards (“TAS”) and Turkish Financial Reporting Standards (“TFRS”) published by Public Oversight Accounting and Auditing Standards Authority (“POA”) except for matters regulated by BRSA legislation (together referred as “BRSA Accounting and Financial Reporting Legislation”). The accompanying financial statements and explanations and notes to these statements as of 31 December 2024 have been prepared in accordance with the “Communiqué on Financial Statements to be Disclosed to Public by Banks and Explanations and Footnotes Thereof’’ published in the Official Gazette numbered 28337, dated 28 June 2012, “Communiqué on the Preparation of Consolidated Financial Statements of Banks’’ published in the Official Gazette numbered 26340, dated 8 November 2006 and “Communıqué on Disclosures About Risk Management to be Announced to Public by Banks” published in the Official Gazette numbered 29511, dated 23 October 2015 and amendments and changes to these communiqués. b. Changes in accounting policies and disclosures: In accordance with the TAS 29 "Financial Reporting in Hyperinflationary Economies", entities whose functional currency is that of a hyperinflationary economy report their financial statements based on the purchasing power of the currency at the end of the reporting period. Following the announcement made by the Public Oversight, Accounting and Auditing Standards Authority (“POA”) on 23 November 2023, entities applying TFRS are required to present their financial statements for annual reporting periods ending on or after 31 December 2023, adjusted for inflation in accordance with the accounting principles set forth in TAS 29. The same announcement stated that regulatory authorities empowered to regulate and supervise in their respective fields may determine different transition dates for the application of inflation accounting. In this context, in accordance with the BRSA's decisions dated 12 December 2023 and numbered 10744 and dated 5 December 2024 and numbered 11021, respectively, it has been decided not to subject the financial statements of banks and financial leasing, factoring, financing, savings financing and asset management companies to inflation adjustment required under TAS 29 in 2024 and 2025. Accordingly, TAS 29 has not been applied in the financial statements of the Bank as of 31 December 2024. While preparing the consolidated financial statements, the Parent Bank used the financial statements of its subsidiaries Kalkınma Yatırım Varlık Kiralama A.Ş. and Kalkınma Girişim Sermayesi Portföy Yönetimi A.Ş., which are not subject to inflation accounting in accordance with TAS 29. c. Other issues: None. 13 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION THREE (Continued) ACCOUNTING POLICIES (Continued) II. Basis of Valuation Used in the Preparation of Financial Statements: Accounting policies for the preparation of consolidated financial statements and valuation principles used are applied in accordance with BRSA Accounting and Financial Reporting Legislation. Those accounting policies and valuation principles are explained below notes through II - XXVI. Except for the consolidated financial assets and liabilities carried at fair value, the consolidated financial statements have been prepared in thousand of Turkish Lira (“TL”) under the historical cost. III. Explanations on Utilization Strategy of Financial Instruments and Foreign Currency Transactions: Most of the liabilities of the balance sheet of the Bank consists of funds obtained from domestic and international markets. The majority of funds obtained domestically consists of funds provided by Central Bank of the Republic of Türkiye, international institutions such as Islamic Development Bank, KfW Development Bank and the OPEC International Development Fund, via Republic of Türkiye Ministry of Treasury and Finance and budget originated funds and the rest consists of funds provided through short- term money market transactions within the framework of balance sheet management. The Bank acts as an intermediary for those funds provided by the Republic of Türkiye Ministry of Treasury and Finance to be utilized in various sectors. The funds obtained internationally consist of medium and long term loans borrowed from World Bank, European Investment Bank, Council of Europe Development Bank, Islamic Development Bank, International Islamic Trade Finance Corporation, Japan Bank for International Cooperation, Black Sea Trade and Development Bank, Asian Infrastructure Investment Bank, KfW Development Bank, China Development Bank and the securities issued as allocated to French Development Agency. During the utilization of the funds obtained, the Parent Bank pays attention for utilization of loans in line with borrowing conditions while taking assets-liability mismatch into account, and tries to avoid maturity, exchange rate and liquidity risks. Exchange rate risk, interest rate risk and liquidity risk are measured and monitored on a regular basis, necessary measures are taken as a result of changes in the market data and balance sheet management is performed within the predetermined risk limits and legal limits. A non-speculative exchange rate position risk management is applied to limit the Parent Bank’s exchange rate risk. For that reason, during the determination of the allocation of balance sheet and off-balance sheet assets according to currencies, foreign currency management policy is applied in the most effective way. Commercial placements are directed to high-profit and low-risk assets by taking Parent Bank-specific and domestic economic expectations, market conditions, expectations and inclinations of loan customers, risks like interest, liquidity, exchange rate etc. into account, and safety policy is kept in the foreground for placement activities. Basic macro goals concerning balance sheet sizes are determined during budgeting and the transactions are carried out according to work programs prepared in this context. The exchange rates, interest and price movements are closely monitored; transaction and control limits that are developed from the Parent Bank’s previous experiences are based on when taking positions as well as legal limits. In this way, limit excesses are prevented. 14 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION THREE (Continued) ACCOUNTING POLICIES (Continued) III. Explanations on Utilization Strategy of Financial Instruments and Foreign Currency Transactions (Continued): During foreign currency transactions, procedures detailed below are applied. a. Foreign currency monetary assets and liabilities are translated to Turkish Lira (TL) with the buying exchange rates announced by the Parent Bank at the end of period and foreign exchange differences are accounted as foreign exchange gain or loss. b. There are no exchange rate differences capitalized as of the balance sheet date. c. Basic principles of exchange rate risk management policy: Decisions to avoid exchange rate and parity risks are taken by the Asset- Liability Committee that meets regularly. The decisions are in line with the models prepared in the context of the basic boundaries of Foreign Currency Net General Position/Shareholders’ Equity Ratio which is included in legal requirements, and those decisions are carried out carefully. To avoid parity risk, foreign exchange position is managed by taking singular and general positions. d. Foreign currency transactions are calculated using the exchange rates prevailing at the dates of transactions and the profit/losses are included in the statement of profit or loss of the related period IV. Explanations on consolidated partnerships: a. Consolidation principles applied: Consolidated financial statements are prepared in accordance with the “Communiqué on the Preparation of Consolidated Financial Statements of Banks” and “TFRS - 10 Consolidated Financial Statements” published in the Official Gazette dated 8 November 2006 and numbered 26340. b. Consolidation principles of subsidiaries Subsidiaries, whose capital or management is directly or indirectly controlled by the Parent Bank, have the power over the investment made by the Parent Bank and the ability to use its power over the investee in order to affect the amount of returns it has and the amount of returns it will gain due to its relationship with the invested legal entity. partnerships it has. Subsidiaries are consolidated using the full consolidation method on the basis of operating results, asset and equity sizes. According to the full consolidation method, one hundred percent of the subsidiaries’ assets, liabilities, income, expenses and off-balance sheet items are consolidated with the Parent Bank’s assets, liabilities, income, expense and off-balance sheet items. The book value of the investments of the Bank in its subsidiaries and the capital of its subsidiaries have been clarified. Balances arising from the transactions between the partnerships within the scope of consolidation have been mutually offset. The Parent Bank and its consolidated subsidiaries will be referred to as the “Group” in the remainder of the report. The title of the partnerships within the scope of consolidation, the location of the headquarters, the activity subject, the effective and direct shareholding ratio are as follows: Effective Direct and Title indirect Center of Activities Main Area of Partnership partnership (City/Country) Activity Ratios (%) rates (%) Kalkınma Girişim Sermayesi Portföy Portfolio Yönetimi A.Ş. İstanbul/Türkiye Management 100 100 Kalkınma Yatırım Varlık Kiralama A.Ş. İstanbul/Türkiye Asset Lease 100 100 . 15 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION THREE (Continued) ACCOUNTING POLICIES (Continued) V. Representation of affiliates, subsidiaries and jointly controlled partners not included in consolidation in the consolidated financial statements: Subsidiaries, subsidiaries and jointly controlled partners that are not included in the scope of consolidation are recognized at cost in accordance with “TAS - 27 Separate Financial Statements” and reflected in the consolidated financial statements after deducting if it has any provision for loss in value. VI. Explanations on Futures, Option Contracts and Derivative Instruments: Derivative transactions of the Bank mainly consist of forward foreign currency purchase and sale and currency swap transactions. The Bank has no derivative instruments that can be separated from the host contract. Derivative instruments are classified as “Derivative Financial Assets at Fair Value Through Profit or Loss” or “Derivative Financial Assets at Fair Value Through Other Comprehensive Income” within the scope of TFRS 9 Financial Instruments. Derivative financial instruments are recorded with the fair value at the date of agreement and revalued at fair value in the following reporting periods. Depending on whether the valuation difference is negative or positive, these differences are shown in the relevant accounts in the balance sheet. Receivables and liabilities arising from derivative transactions are recorded in off-balance sheet accounts over their contract amounts. Differences in the fair value of derivative transactions at fair value through profit or loss are accounted for under profit/loss from derivative financial transactions in the trading profit/loss item in statement of profit or loss. VII. Explanations on Interest Income and Expenses: Interests are recorded according to the effective interest rate method (rate equal to the rate in calculation of present value of future cash flows of financial assets or liabilities). If a financial asset possesses on uncollected interest accrual before its acquisition by the Bank, interest collected afterwards is separated into periods such as before its acquisition and after acquisition, and only the part of after acquisition is recognized as interest income on the statement of profit or loss. The Parent Bank does not cancel the interest accruals and rediscounts of loans and other receivables that have become non-performing loans within the framework of the effectuated in 1 January 2018 “Methods and Principles for the Determination of Loans and Other Receivables to be Reserved for and Allocation of Reserves” published in the Official Gazette dated 22 June 2016 and numbered 29750 and monitors said amounts in interest income. Within the scope of TFRS 9 methodology, the expected credit loss provision is calculated based on the interest accruals and rediscounts added amounts. VIII. Explanations on Fees and Commission Income and Expenses: Fees and commissions received from cash loans, that are not attributable to interest rates applied, and fees for banking services are recorded as income in accordance with TFRS 15 ‘Revenue from Contracts with Customers’ on the date of collection. Fees and commissions paid for the funds borrowed, which are not attributable to interest rates of the funds borrowed, are recorded as expense on the date of the payment. All other commission and fee income and expenses are recorded on an accrual basis. Earnings in return of agreements or as a result of services provided for real or legal third parties for purchase or sale of assets are recorded as income when collected. 16 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION THREE (Continued) ACCOUNTING POLICIES (Continued) IX. Explanations on Financial Assets: Financial assets mainly constitute the Group’s commercial activities and operations. These instruments have the ability to expose, affect and diminish the liquidity, credit and interest rate risks in the financial statements. The Group adds its financial assets to the financial statements in accordance with the provisions of the “Importing and Excluding the Financial Statements” section of the TFRS 9 Standard and subtracts them from the financial statements. Financial assets are included in the statement of financial status when they become a party to the terms of the contract related to the financial asset and measured at fair value for the first time (excluding trade receivables under TFRS 15 Revenue from Contracts with Customers). In accordance with the classification provisions of the TFRS 9 Financial Instruments Standard, on the basis of the following matters financial assets are measured at amortised cost, fair value through other comprehensive income or fair value through profit or loss by: - The business model used by the entity for the management of financial assets, - Properties of contractual cash flows of a financial asset. Business Model Test and Cash Flow Characteristics Test are performed to determine the classification of financial assets. Purchase and sale transactions of these financial assets are accounted according to their “delivery date”. The classification of financial assets is decided on the date of their acquisition, taking into account “Testing of Contractual Cash Flows Only Interest and Principal and Evaluation of Business Model”. When the business model used for the management of financial assets is changed, all financial assets affected by this change are reclassified. Financial Assets Measured at Fair Value through Profit and Loss: Financial assets whose fair value differences are reflected in profit/loss are mainly for a short-term securities acquired for the purpose of being sold or bought back in the near future. Financial assets whose fair value difference is reflected in profit/loss are reflected to the balance sheet at their cost values and are subject to valuation at fair value following their recording. Fair values are determined by using the weighted average clearing prices on BIST as of the balance sheet date for securities traded on Borsa Istanbul (BIST) and investor valuation and price reports for non-traded securities. Gains or losses resulting from the valuation of financial assets whose fair value difference is reflected in profit/loss are reflected in profit/loss accounts. The positive difference between the acquisition cost and discounted value during the holding of financial assets for trading purposes is recorded in “Interest Income”, if the fair value of the asset is above its discounted value, the positive difference is recorded in the “Capital Market Transactions Profits” account and if it is below, the negative difference is recorded in the “Capital Market Transactions Losses” account. 17 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION THREE (Continued) ACCOUNTING POLICIES (Continued) IX. Explanations on Financial Assets (Continued) Financial Assets Measured at Fair Value Through Other Comprehensive Income: Financial assets are classified as financial assets at fair value through other comprehensive income where the business models aim to hold financial assets in order to collect the contractual cash flows and selling assets and the terms of financial asset give rise to cash flows that are solely payments of principal of interest at certain dates. Financial assets measured at fair value through other comprehensive income are initially recognized at cost including the transaction costs. After initial recognition, valuation of the financial assets at fair value through other comprehensive income is based on fair value. For securities traded on Borsa Istanbul (BIST), fair values are found by using the weighted average settlement prices in BIST at the balance sheet date. In the case a price does not occur in an active market, it is accepted that fair value cannot be reliably determined and amortised cost which is calculated by using the effective interest rate method is accepted as the fair value.The difference between the cost and fair value is accounted as interest income accrual or impairment loss. Interest income for financial assets measured at fair value through other comprehensive income with fixed or floating interest rate shows the difference between cost and amortised cost calculated by using the effective interest rate method and accounted for as interest income from marketable securities. Unrealized gains and losses arising from changes in fair value of the financial assets measured at fair value through other comprehensive income and which are denoting the difference between fair value and amortised cost of financial assets, are recognized in the “Accumulated Other Comprehensive Income or Loss that will be Reclassified to Profit or Loss” and amounts accounted for under equity are reflected to statement of profit or loss when financial assets are sold. In the event that the financial assets reflected to other comprehensive income are disposed of in the case of the real value difference, the value increases/decreases pursued in the equity values value increase fund account are reflected in the statement of profit or loss. Equity Instruments Measured at Fair Value Through Other Comprehensive Income During initial recognition an irreversible preference can be made about reflecting the changes in the fair value of the investment in an equity instrument within the scope of TFRS 9, which are not held for trading purposes or that are not contingent on the financial statements of the acquirer in a business combination where the TFRS 3 Business Combinations standard is applied in the other comprehensive income. The choice in question is made separately for each financial instrument. The relevant fair value differences recognized in the statement of other comprehensive income are not transferred to profit or loss in the following periods but are transferred to previous periods’ profit/loss. Dividends from such investments are included in the financial statements as profit or loss unless they are explicitly a part of the investment cost recovery. TFRS 9 impairment provisions are not valid for equity investments. 18 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION THREE (Continued) ACCOUNTING POLICIES (Continued) IX. Explanations on Financial Assets (Continued) Equity Instruments Measured at Fair Value Through Other Comprehensive Income (Continued) Equity securities representing a share in the capital, which are classified as financial assets at fair value through other comprehensive income, are accounted with their fair values if they are traded in organized markets, and/or their fair value can be determined reliably. However, the cost may be an appropriate estimation method for determining fair value in some exceptional circumstances. This may be the case if there is not enough recent information on fair value measurement or if fair value can be measured by more than one method and the cost best reflects the fair value estimation among these methods. Financial Investments Measured at Amortised Cost and Loans: Financial Investments Measured at Amortised Cost If the financial asset is held within a business model whose objective is to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding, the financial asset is classified as a financial asset measured at amortised cost. Financial assets measured at amortised cost are initially recognised at amortised cost using the effective interest method, less provision for impairment, if any, or interest income rediscount. Interest earned on financial assets measured at amortised cost is recognised as interest income. The Bank's securities portfolio includes consumer price (CPI) indexed bonds, which are classified as financial assets whose fair value difference is reflected in other comprehensive income and financial assets measured by their amortized cost. As stated in the CPI-Indexed Bonds Investor Guide of the Ministry of Treasury and Finance of the Republic of Türkiye, the reference indices used in the calculation of the actual coupon collection amounts of these securities are formed according to the CPI of two months ago. The valuation of these securities is carried out according to the effective interest method within the framework of the reference index formula specified in this guideline. Loans Loans represent unquoted financial assets in an active market that provide money, goods or services to the debtor with fixed or determinable payments. Loans are initially recognized with cost and carried at amortised cost calculated using the effective interest rate method at the subsequent periods. Transaction fees, dues and other expenses paid for loan guarantees are considered as a part of the transaction cost and reflected to the customers. Cash loans granted by the Bank consist of investment and working capital loans and loans given through banks and leasing companies (APEX method). Foreign currency indexed loans are converted into Turkish Lira with the exchange rate on the opening date and followed in Turkish Currency accounts. Repayments are calculated by using the exchange rates at the repayment dates and exchange differences are recognized under the foreign currency income and expense accounts. The Bank management monitors the loan portfolio at regular intervals and in case of doubts regarding the uncollectibility of the loans extended, the loans that are considered to have become problematic are classified in accordance with the principles set out in the ‘Regulation on Procedures and Principles Regarding the Classification of Loans and Provisions to be set aside (Provisions Regulation)’ published in the Official Gazette dated 22 June 2016 and numbered 29750 and last amended by the regulation published in the Official Gazette dated 18 October 2018 and numbered 30569 and within the framework of TFRS 9. 19 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION THREE (Continued) ACCOUNTING POLICIES (Continued) IX. Explanations on Financial Assets (Continued): Loans (Continued) With the Law No. 7147 dated 24 October 2018 on Türkiye Kalkınma ve Yatırım Bankası A.Ş., it was decided that the first paragraph of Article 53 of the Banking Law No. 5411 shall not be applied to the Bank and the procedures and principles regarding the classification, monitoring, follow-up, provision ratios and collaterals of loans shall be determined by the Board of Directors of the Bank. In this context, the Bank has decided to perform the classification and provisioning of loans in accordance with TFRS 9 Standard and Provisions Regulation. Cash and Cash Equivalents: Cash and cash equivalents are cash on hand, demand deposits and other highly liquid short-term investments with maturity of 3 months or less following the date of purchase, which is readily convertible to a known amount of cash and does not bear the risk of significant amount of value change. The carrying amounts of these assets represent their fair values. X. Explanations on Impairment of Financial Assets: As of 1 January 2019, the Parent Bank recognizes provisions for impairment in accordance with TFRS 9 requirements according to the “Regulation on the Procedures and Principles for Classification of Loans and Provisions to be Set Aside”. In this framework, the method of allocating credit provisions applied within the framework of the relevant legislation of BRSA has been replaced with the expected credit loss model. Expected credit loss (ECL) model is used for instruments (such as bank deposits, loans and leasing receivables) recorded in the statement of other comprehensive income over amortized cost or fair value and in addition for financial lease receivables that cannot be measured at fair value through profit/loss, contract assets, credit commitments, and financial guarantee contracts. The guiding principle of the ECL model is to reflect the general outlook of the increase or improvement in credit risk of financial instruments. The amount of ECLs defined as loss provision or provision depends on the degree of increase in credit risk since the loan was first issued. Within the scope of TFRS 9 Financial Instruments, three basic factors regarding the measurement of expected credit loss are taken into consideration. These, (a) the amount weighted according to the neutrality and probabilities determined by evaluating the possible outcome range, (b) time value of money, (c) reasonable and supportable information on past events, current conditions and forecasts of future economic conditions that can be obtained without incurring excessive cost or effort as of the reporting date. Taking into consideration these three factors, the Parent Bank’s historical data is modeled, and the expected loss amount is calculated for each loan. Since the expected loss represents the future value, the present value of this amount is calculated with the discounting factor. In order to reflect the changes in credit risk since the initial recognition of credit risk, the loss provision is updated at each reporting date in which the expected loss calculations are performed. 20 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION THREE (Continued) ACCOUNTING POLICIES (Continued) X. Explanations on Impairment of Financial Assets (Continued): The Parent Bank assesses whether there has been a significant increase in credit risk in the financial instrument for the first time since it was included in the financial statements. In making this assessment, the Parent Bank uses the change in default risk during the expected life of the financial instrument. To make this assessment, the Parent Bank compares default risk related to the financial instrument as of the reporting date and the default risk related to the financial instrument for the first time in the financial statements and takes into consideration reasonable and supportable information which can be obtained without incurring excessive costs or efforts and is reasonable indication of significant increases in credit risk since its introduction for the first time. As of 30 June 2024, new rating methodologies and models and new TFRS 9 methodologies and models have started to be used in TFRS 9 expected loss calculations. In these models, customers are segmented as Corporate-SME, Project Finance and Financial Institutions (including Banks). In the TFRS 9 impairment, a three-step approach is used in which the credit risk level increases at each stage: Stage 1: It refers to all accounts that have not shown any deterioration in credit quality since the loan was issued. All accounts defined as having low credit risk will be classified as Stage 1 without periodically checking whether there is a significant increase in credit risk. A 12-month provision calculation is performed for all accounts classified in Stage 1. Stage 2: Refers to all accounts showing significant deterioration in credit quality since the loan was issued. For all accounts classified in Stage 2, lifetime provision calculations are performed. Stage 3: Refers to all impaired assets. For all accounts classified in Stage 3, lifetime provision calculations are performed. Financial assets in Basket 3 might be evaluated individually in the current provision calculations made by the Bank, and final evaluation is made by the Board of Directors together with their justifications. In this context, the Bank has allocated additional provisions for customers whose impacts are considered to be high, by making individual valuations in the calculation of expected credit losses. TFRS 9 requires a 12-month compensation for all loans in Stage 1, and a lifetime provision for all remaining loans. Significant Increase in Credit Risk Customers classified under the first group are classified under the second group if they meet the following criteria; • The maximum number of delay days of the customer is over 30 • Restructuring of a debtor in financial difficulty by granting concessions • Customer has close monitoring criteria • Criteria for significant increase in credit risk: For customers rated with the Corporate-SME Rating Model, the criterion of significant increase in credit risk is met if the deterioration between the rating obtained on the basis of the latest financial balance sheet and the rating obtained one year ago is more than 4 degrees and the current rating is a rating equivalent to Group C ratings (9, 10, 11 ratings) or the current rating is calculated as 11, which is the worst rating class. If the customer's rating from a year ago is not available, the first rating within 1 year is taken into account instead.Customers are periodically evaluated (at least once a year) and their ratings are updated in order to evaluate the criterion of significant increase in credit risk. The evaluation period is shortened for the borrowers for whom a significant deterioration signal is received in credit risk during the year 21 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION THREE (Continued) ACCOUNTING POLICIES (Continued) X. Explanations on Impairment of Financial Assets (Continued): Significant Increase in Credit Risk (Continued) For the customers in the Project Finance portfolio and rated with the Project Finance Rating model, if the current rating is in the worst class (8 - Weak), the criterion of significant increase in credit risk is fulfilled. If the customer does not have a rating from one year ago, the first rating within one year is taken into consideration instead. Customers are periodically evaluated (at least once a year) and their ratings are updated in order to evaluate the criterion of significant increase in credit risk. The evaluation period is shortened for the borrowers for whom a significant deterioration signal is received in credit risk during the year. Classification criterias under Stage 2 work for all Bank customers, in addition, in case of negative market intelligence, classification can be made under Stage 2. The classification rules determined within the scope of TFRS 9 work for all portfolios. Definition of Default “When defining the default for the purpose of determining the default risk according to TFRS 9, the entity uses a default definition consistent with the definition used for the credit risk management purposes of the related financial instrument and, if appropriate, takes into account qualitative indicators (e.g. financial commitments). However, unless the entity has reasonable and supportable information that reveals that default will occur when there is a longer delay, there is an otherwise demonstrable pre-acceptance that the default will not occur after the financial instrument expires after 90 days. The definition of default used for these purposes is applied consistently to all financial instruments unless information that proves that another definition of default is more appropriate for a particular financial instrument is available.” According to the article, the definition of default is used within the scope of modeling. The definition of default used in the Bank is as follows: • Customers with more than 90 days of delay (The number of customer delay days represents the highest number of delay days of the customer’s existing loans on the relevant reporting date.) • Compensation of the letter of guarantee received by the Bank for collateral • The Bank is of the opinion that the debtor will not be able to pay its debts to the Bank in full without recourse to collateral. 12-Month Expected Loss 12-month loan loss corresponds to a part of the expected loan loss that may arise from the possible default status of the loan within 12 months of the reporting date. 22 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION THREE (Continued) ACCOUNTING POLICIES (Continued) X. Explanations on Impairment of Financial Assets (Continued): Lifetime Expected Loss Lifetime losses arise from all possible default events that may occur during the expected life span of the financial instrument after the reporting date. Life expectancy is related to the maturity of the financial instrument. One of the risk parameters to be used in calculating the provision amounts to be set as per TFRS 9 is the Probability of Default (PD) information. Probability of Default refers to the possibility of a live loan falling into default. PD calculation is carried out by considering past data, current conditions and prospective macroeconomic expectations. In the Bank's new models, qualitative and quantitative scores are taken into account when evaluating the Corporate-SME and Project Finance segments. After the qualitative and quantitative scores of the company are determined, the mentioned points are weighted according to the company scale and the company's rating score is calculated. In the new methodology, the Financial Institutions (including receivables from banks) portfolio is evaluated with the ratings of internationally recognized rating agencies. If there is no rating assigned by a rating agency, then the rating of the country where the financial institution is located is taken into account. As of 30 June 2024, in the new macro models applied, Vasicek's approach based on a single-factor explanatory model was used for both portfolios in order to calculate default probabilities including forward-looking macro impact for the Corporate-SME portfolio and the Financial Institutions portfolio. The systemic risk factor to be used for this approach is the GDP growth rate, which is considered to be one of the most comprehensive macroeconomic indicators and is widely used in the sector for the systemic risk factor. This systemic risk factor is reviewed and revised on an annual basis. In order to obtain default probabilities for the Project Finance portfolio, it has been decided to use the Expected Loss (EL) values that will be used for specialized loans in accordance with paragraph 37 of the BRSA Communiqué on Calculation of the Amount Subject to Credit Risk with Internal Ratings Based Approaches (BRSA Communiqué on Calculation of the Amount Subject to Credit Risk with Internal Ratings Based Approaches) also within the scope of TFRS and default probabilities to be applied according to rating groups have been obtained over these values. In addition to the baseline scenario value, positive and negative scenarios are taken into account and the future period forecasts for each rating group are realized with an approach based on the correlation of the portfolio default rate with a key macro variable. 23 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION THREE (Continued) ACCOUNTING POLICIES (Continued) XI. Explanations on Offsetting of Financial Assets and Liabilities: Financial assets and liabilities are offset on balance sheet when the Group has a legally enforceable right to set off, and the intention of collecting or paying the net amount of related assets and liabilities or the right to offset the assets and liabilities simultaneously. XII. Explanations on Sales and Repurchase Agreements and Lending of Securities: Securities sold in repurchase agreements (repo) are followed in the balance sheet accounts in line with Uniform Chart of Accounts. Accordingly, the government bonds and treasury bills sold to the clients in the context of repurchase agreements are classified as “Subject to Repurchase Agreements” and are valued at fair values or at discounted values using effective interest rate method according to the holding purposes in the Bank portfolio. Funds gained by repurchase agreements are shown separately in the liability accounts and interest expense accrual is calculated for these funds. Securities that were purchased to resell commitment (reverse repurchase agreements) are shown as a line item under ‘‘Money Market Placements’’ line. For the difference between the purchase of securities and resale prices of the reverse repo agreements for the period; income accrual is calculated using the effective interest rate method. There are no marketable securities lending transactions. XIII. Explanations on Fixed Assets Held for Sale and Discontinued Operations and Related Liabilities: Non-current assets held for sale and non-current assets related to discontinued operations and related liabilities are recognized in the financial statements in accordance with the provisions of TFRS 5 "Standard for Fixed Assets Held for Sale and Discontinued Operations". Assets that are classified as held for sale (or the disposal group) are measured at the lower of its carrying amount and fair value less costs to sell. In order to classify a tangible fixed asset as held for sale, the asset (or the disposal group) should be available for an immediate sale in its present condition subject to the terms of any regular sales of such assets (or such disposal groups) and the sale should be highly probable. For a highly probable sale, the appropriate level of management must be committed to a plan to sell the asset (or the disposal group), and an active program to complete the plan should be initiated to locate a customer. Also, the asset should have an active market sale value, which is a reasonable value in relation to its current fair value. Events or circumstances may extend the completion of the sale more than one year. Such assets (or the disposal group) are still classified as held for sale if there is sufficient evidence that the delay in the sale process is due to the events and circumstances occurred beyond the control of the entity or the entity remains committed to its plan to sell the assets. The Parent Bank has no assets classified as held for sale. A discontinued operation is a component that either has been disposed of or is classified as held for sale. Gains or losses relating to discontinued operations are presented separately in the statement of profit or loss. The Parent Bank has no discontinued operations. 24 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION THREE (Continued) ACCOUNTING POLICIES (Continued) XIV. Explanations on Goodwill and Other Intangible Assets: As at the balance sheet date, there is no goodwill recorded in the balance sheet of the Bank. Intangible fixed assets first are carried at cost which includes acquisition costs and other direct costs bearded necessary for the assets to become ready for use. Subsequent to recognition, intangible assets are presented in financial statements at cost less any accumulated amortization and accumulated impairment losses, if any. Amortization is charged on a straight-line basis over their estimated useful lives which is 33,33% or 6,67%. Useful life of other intangible assets are determined by the consideration of items like expected usage period of the asset, technical, technological or other kind of obsolesce and maintenance costs incurred to obtain economic benefit from the assets. Expenses related to existing computer software and computer software improvement that enhance original content and useful life, are capitalized over the software. Those capitalized expenses are amortised using the “straight line method”. XV. Explanations on Tangible Fixed Assets: Tangible fixed assets are carried at cost which includes acquisition costs and other direct costs bared necessary for the assets to become ready for use, and if results of appraisal reports exceed the costs, they are not subject to any revaluation. Subsequent to recognition, tangible fixed assets are presented in financial statements at cost less any accumulated depreciation and accumulated impairment losses, if any. Gain or loss arising from the disposal or retirement of an item of tangible fixed assets is determined as the difference between the sales proceeds and the carrying amount of that asset and is recognized in profit or loss. Ordinary maintenance and repair expenses of tangible fixed assets items are recognized as expenses. Investment expenditures that increase the future benefit by enhancing the capacity of tangible assets are capitalized. Investment expenditures include cost items that extend the useful life of the asset, increase the servicing capabilities of the asset, improve the quality of goods or services produced or reduces the costs. There is no pledge, mortgage and other restriction on the tangible fixed assets or given for the purchase commitments or any restrictions on the rights for the use of these. Tangible fixed assets are amortised by using the straight-line method over their estimated useful lives. Estimated depreciation rates of tangible fixed assets are as follows. Estimated Useful Life (Years) Depreciation Rate (%) Building 50 2 Safes (vaults) 50 2 Vehicles 5 20 Other Tangible Assets 3-15 6,66-33,33 There is no change in economic depreciation estimations that has material effect in the current period or that is expected to have effect in the subsequent periods. 25 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION THREE (Continued) ACCOUNTING POLICIES (Continued) XVI. Explanations on Leasing Transactions: The “TFRS 16 Leases” Standard was published in the Official Gazette dated 16 April 2018 and numbered 29826 to be applied as of 1 January 2019. The Parent Bank as a Lessee The “TFRS 16 Leases” Standard removes financial lease and operational lease distinction for lessees and introduces a single accounting model for all leasing transactions. According to the standard, the lessees reflect a “asset that gives the right to use” and a “lease obligation” to the financial statements at the date when the lease begins. The initial cost of the asset that gives the right to use is measured by deducting the lease incentives from the sum of the lease obligation and the initial direct costs incurred by the lessees. The cost method is used for the measurements after the beginning of the lease. In this method, the asset that gives the right to use is measured by deducting the accumulated depreciation and accumulated depredation provisions from the cost value. The lease obligation is initially measured at the present value of the lease payments to be made during the lease period. In subsequent measurements, the book value of the liability is increased to reflect the interest on the lease obligation and decreased to reflect the lease payments made. TFRS 16 has made exemptions for leases of 12 months or less and leases related to low value assets. The Group, which is a lessee in financial leasing transactions, accounts for all lease transactions longer than 12 months as assets and liabilities in the statement of financial position. Depreciation expense related to the leased asset and interest expense in lease payments are reported in the statement of profit or loss. The lease obligation was initially measured at the present value of the lease payments to be made during the lease period using the Group’s TL alternative source cost. The Parent Bank as a Lessor According to the “TFRS 16 Leases” Standard, financial lease and operational lease distinction continues for the lessor. If the lessor transfers the significant risks and benefits arising from ownership of the asset subject to the lease to the lessee, he will classify it as a financial lease. Other leases will be classified as operational leases. The receivables that arise from leasing the assets of the Bank, which are not included in financial lease transactions and which are not used in banking transactions, are followed up in the receivables from the leasing transaction and are accounted on an accrual basis. XVII. Explanations on Provisions and Contingent Liabilities: In the consolidated financial statements, a provision is made for an existing commitment resulted from past events if it is probable that the commitment will be settled, and a reliable estimate can be made of the amount of the obligation. Provisions other than the expected credit loss set for loans and other receivables and contingent liabilities are accounted for in accordance with ‘Turkish Accounting Standard on Provisions, Contingent Liabilities and Contingent Assets’ (TAS 37). For transactions that can affect financial structure, provisions are provided by using the existing data if they are accurate, otherwise by using the estimates. 26 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION THREE (Continued) ACCOUNTING POLICIES (Continued) XVIII. Explanations on Employee Benefit Liabilities: Obligations for employee benefits are recognized in accordance with the TAS 19 “Employee Benefits”. Under the Turkish legislation as supplemented by union agreements, lump sum payments are made to all employees who retire or whose employment is terminated without due cause. In accordance with the working status of the Bank and the social security institution legislation, the retirement pension is related to the ones related to the Law No: 5434 and the severance payment is calculated to those related to the Law No: 1475. The principal assumption is that the maximum liability for each year of service will increase parallel with inflation. Thus, the discount rate -unless it is negative- applied represents the expected real rate after adjusting for the anticipated effects of future inflation. Consequently, in the accompanying financial statements as of 31 December 2024, the provision has been calculated by estimating the present value of the future probable obligation of the Bank arising from the retirement of the employees. The provisions at the respective balance sheet date have been calculated with a discount rate of 3,01% (31 December 2023: 1,91%). The maximum amount of full TL 46.655,43 effective from January 2025 has been taken into consideration in calculation of provision for employment termination benefits (31 December 2023: full TL 35.058,58). XIX. Explanations on Taxation: Current Tax In the first paragraph of Article 32 of the Law No. 5520 titled “Corporate Tax and Provisional Tax Rate”, regarding the enforcement of Article 21 of the “Law on the Amendment of Additional Motor Vehicles Tax for Compensation of Economic Losses Caused by the Earthquakes Occurring on 6 February 2023 and Amendments to Some Laws and the Decree Law No. 375”, which came into force by being published in the Official Gazette dated 15 July 2023 and numbered 32249, starting from the declarations that must be submitted as of 1 October 2023, corporate income tax rate to be applied to corporate earnings for the 2023 and subsequent taxation periods is 30% for banks, financial leasing, factoring, financing and savings financing companies, electronic payment and money institutions, authorized foreign exchange institutions, asset management companies, capital market institutions, insurance and reinsurance companies and pension companies. The corporate tax rate is applied to the tax base to be found as a result of adding the non-deductible expenses to the commercial earnings of the companies, the exemption (such as the participation earnings exemption) and the deduction of the deductions in the tax laws. No further tax is paid if the profit is not distributed. Non-resident corporations’ income through a permanent establishment or permanent representative in Türkiye and dividends paid to companies’ resident in Türkiye (dividends) not subject to withholding. Dividend payments made to individuals and institutions other than these are subject to 10% withholding tax. Addition of profit to capital is not considered as profit distribution and withholding tax is not applied. Corporations are required to pay advance corporate tax quarterly on their corporate income. Advance tax is declared by the 17th and paid by the 17th day of the second month following each calendar quarter end. Advance tax paid by corporations for the current period is credited against the annual corporation tax calculated on the annual corporate income in the following year. Despite the offset, if there is temporary prepaid tax remaining, this amount can be refunded in cash or can be offset against other financial debts to the state. According to Real Estate Sales Exemption in the Article 5.1.e. of Corporate Tax Law which is one of the important tax exemptions applied by the Bank, a 50% exemption is applied to the profits arising from the sale of real estate that has been in the assets of institutions for at least two full years (730 days), while exemption rate is 25% for profits arising from sales of real estate that has been in the assets of institutions before 15 July 2023, the date of entry into force of the Law No. 7456; within the scope of this article Corporate Tax exemption will not be applied to real estate acquired after 15 July 2023. 27 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION THREE (Continued) ACCOUNTING POLICIES (Continued) XIX . Explanations on Taxation (Continued): Current Tax (Continued) The 75% exemption from corporate tax for the gains arising from the sale of founders' shares, redeemed shares and preemptive rights that are hold for the same period as participation shares was reduced to 50% by the Presidential Decree No. 9160 published in the Official Gazette dated 27 November 2024 and numbered 32735. This exemption applies to the period the sale is made and the part of return on sales that benefits from the exemption is held in a special fund in the liabilities account until the end of the fifth year started from the following year sale is made. However, the sales payment must be collected until the end of the second calendar year following the year in which the sale is made. Taxes which are not realized in time due to the exemption that hits uncollected sales payment are considered as tax loss. Taxes which does not accrue on time because the applying exemption for the transfer of the exempted part of revenue to the other accounts with other ways out of capitalizing in five years or withdrawn from company or transferring from limited taxpayer corporations to the headquarters, are considered as tax loss. This is also be applicable in the condition of liquidation of business (Except transfers and divisions that make according to this code). Moreover, according to 5.1.f. article of Corporation Tax Law; corporations which have been fallen to legal proceedings because of owe to the bank or Savings Deposit Insurance Funds, and their warrantors’ real estates, participation stocks, founding bonds, redeemed shares, options to call of mortgagors’ revenues that used for against debts or transferring to SDIF, 50% for real estates, and 75% for others are exempted from Corporation tax. Under the Turkish Corporate Tax Law, losses can be carried forward to offset against future taxable income for up to five years. Losses cannot be carried back to offset profits from previous periods. In Türkiye, there is no procedure for a final and definitive agreement on tax assessments with tax authorities. With the “Tax Procedure Law and the Law on Amendments to the Corporate Tax Law” adopted on the agenda of the Grand National Assembly of Türkiye on 20 January 2022, inflation accounting has been decided to be implemented starting from the balance sheet dated 31 December 2023. Regulations regarding the implementation of Inflation Accounting were determined with the Tax Procedure Law Communiqué No. 555, which entered into force after being published in the Official Gazette No. 32415 dated 30 December 2023. Valuation differences for 2023 will be transferred to equity and will not be associated with the statement of profit or loss. Previous year's profit resulting from inflation correction of the balance sheet at the end of the 2023 accounting period (determined after correction) will not be subject to tax and previous year's losses will not be accepted as loss. On the other hand, in accordance with Article 17 of Law No. 7491 dated 28 December 2023 and numbered 32413, "Banks, companies within the scope of the Financial Leasing, Factoring, Financing and Savings Financing Companies Law No. 6361 dated 21 November 2021, payment and electronic money institutions, authorized foreign exchange institutions" , asset management companies and capital markets, the profit/loss difference resulting from the inflation adjustment made in the 2024 and 2025 accounting periods will not be taken into account in determining the earnings. The President is authorized to extend the periods determined within the scope of this paragraph by one accounting period, including provisional tax periods.” With the foresaid provision valuation differences resulting from the inflation adjustment will not affect the tax base. Article 32/C titled “Domestic minimum corporate tax” has been added to the Corporate Tax Law with Article 36 of Law No. 524 and according to the explanations made in Article 13 of the Communiqué Amending the Corporate Tax General Communiqué Serial No. 1 regarding the said provision, the corporate tax calculated on the earnings obtained in 2025 and the following taxation periods will not be less than 10% of the corporate income before deducting deductions and exemptions, taking into account the relevant provisions. According to Turkish tax legislation, financial losses shown on the declaration can be deducted from the period corporate income for a period not exceeding 5 years. However financial losses can not be offsetted from last year’s profits. In Türkiye, there is no practice of reaching an agreement with the tax authority regarding the taxes to be paid. 28 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION THREE (Continued) ACCOUNTING POLICIES (Continued) XIX . Explanations on Taxation (Continued): Current Tax (Continued) Corporate tax declarations are submitted to the relevant tax office by the evening of the 30th day of the fourth month following the month in which the accounting period is closed, and the accrued tax is paid by the evening of the 30th day. However, the authorities authorized for tax inspection may examine the accounting records within five years, and if erroneous transactions are detected, the tax amounts to be paid may change. Deferred Tax In accordance with TAS 12 “Turkish Accounting Standard Relating to Income Tax”, the Bank calculates and recognizes deferred tax for temporary differences between the bases calculated based on the accounting policies used and valuation principles and that calculated under the tax legislation. Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit and are accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognized for all taxable temporary differences. However, deferred tax assets are recognized for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilized. Such assets and liabilities are not recognized as deferred tax liability or asset if the temporary difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit. The carrying amount of a deferred tax asset is reviewed on each balance sheet date. Carrying amount of a deferred tax asset can be reduced to the extent that it is no longer probable that enough taxable profit will be available to allow all or part of the asset to be recovered. Deferred tax asset and liability are calculated with the valid tax ratios for the related period. Within the scope of the Law No. 7456 published in the Official Gazette dated 15 July 2023 and numbered 32249, deferred tax calculations were made by taking into account the 30% corporate tax rate to be applied for banks and certain financial institutions. Moreover, if the deferred tax is related with items directly recorded under the equity in the same or different period, deferred tax is associated directly with equity. Deferred tax asset and deferred tax liability are presented as net in these financial statements. The income tax charge is composed of the sum of current tax and deferred tax charges. The current tax liability is calculated over taxable profit for the year. Taxable profit differs from profit as reported in the statement of profit or loss because it excludes items of income or expense that are taxable or deductible and it further excludes items that are never taxable or deductible. According to the second paragraph of the Article 53 of the Banking Act No: 5411, all specific reserves for loans and other receivables are considered as deductible expense for determining corporate tax base. The current tax payable is offset with prepaid tax, if they are associated with. Deferred tax assets and liabilities are also offset. Deferred tax calculation is made within the scope of TFRS 9 for the first and second stage provisions. Transfer Pricing Transfer pricing is regulated through Article 13 of Corporate Tax Law titled “Transfer Pricing Through Camouflage of Earnings”. Detailed information for the practice regarding the subject is found in the “General Communiqué Regarding Camouflage of Earnings Through Transfer Pricing”. According to the aforementioned regulations, in the case of making purchase or sales of goods or services with relevant persons/corporations at a price that is determined against “arm’s length principle”, the gain is considered to be distributed implicitly through transfer pricing and such distribution of gains is not subject to deductions in means of corporate tax. 29 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION THREE (Continued) ACCOUNTING POLICIES (Continued) XX. Additional Explanations on Borrowings: The Parent Bank accounts its debt instruments in the subsequent periods, by using the effective interest rate method. The Bank has no borrowings that require hedging techniques for accounting and valuation of debt instruments and liabilities representing the borrowings. The Parent Bank continues its financial support that it provided and still providing by acquiring sources from domestic and international markets. Domestic resources are provided from Central Bank of the Republic of Türkiye, international organizations such as Islamic Development Bank, KfW Development Bank and OPEC International Development Fund through the Ministry of Treasury and Finance. In addition to these, the Bank acts as an intermediary for the use of various budget-sourced funds domestically. The loan from this source has been disbursed and no new funds have been transferred from the Ministry of Treasury and Finance. The funds provided are recorded in the Bank's resource accounts on the transfer date. The maturity and interest rates of these funds are determined by the public authority through Investment Incentives Communiqués. The present foreign funds of the Bank are medium and long term loans from World Bank, European Investment Bank, Council of Europe Development Bank, Islamic Development Bank, International Islamic Trade Finance Corporation, Black Sea Trade and Development Bank, Japan Bank for International Cooperation, Asian Infrastructure Investment Bank, KfW Development Bank, China Development Bank and the securities issued as allocated to French Development Agency are recorded to related accounts on the date and with the cost of procurement. The Parent Bank generally prefers providing loans in parallel to the borrowing terms like maturity date, interest rate, interest type and currency type to avoid maturity, exchange rate and liquidity risks. The Parent Bank has not issued any convertible bonds. XXI. Explanations on Shares Issued: The Parent Bank's issued capital was increased from TL 2.500.000 to TL 5.500.000 on 30 April 2024 by issuing shares with a nominal value of TL 3.000.000 in the current period. XXII. Explanations on Bill Guarantees and Acceptances: Commitments regarding bill guarantees and acceptances of the Parent Bank are presented in the “Off Balance Sheet” commitments. In the current and previous period, the Parent Bank has no bills and acceptances. XXIII. Explanations on Government Incentives: There are no government incentives utilized by the Group in the current and prior period. XXIV. Earnings Per Share: Earnings per share disclosed in the statement of profit or loss are determined by dividing net profit/loss by the weighted average number of shares in issue during the year concerned. Current Period Prior Period (31.12.2024) (31.12.2023) Net Profit for the Period 6.175.535 4.042.668 Weighted Average Number of Ordinary Shares Issued (Thousand) 450.819.672 250.000.000 Earnings Per Share (in Full TL) 0,01370 0,01617 30 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION THREE (Continued) ACCOUNTING POLICIES (Continued) XXIV. Earnings Per Share (Continued) In Türkiye, companies can increase their share capital by making a pro-rata distribution of “bonus shares” to existing shareholders from retained earnings. For the purpose of earnings per share computations, such “bonus share” distributions are treated as issued shares. Accordingly, the weighted average number of shares used in these calculations is calculated by taking into consideration the retrospective effects of such share distributions. In the event that the number of issued shares increases after the balance sheet date due to the distribution of bonus shares before the date of preparation of the financial statements, earnings per share is calculated by taking into account the total number of new shares. XXV. Related Parties For the purposes of these financial statements, shareholders, senior executives and members of the board of directors, their families and companies controlled or affiliated by them, as well as subsidiaries and joint ventures subject to joint management have been accepted as related parties within the scope of the TAS 24 Related Party Disclosures Standard. Transactions with related parties are shown in footnote VII of Chapter Five. XXVI. Explanations on Segment Reporting: As part of its mission, the Parent Bank operates mainly in the areas of corporate banking and investment banking. Corporate banking provides financial solutions and banking services to customers with medium and large joint stock company status. Services offered include investment loans, project finance, TL and foreign exchange business loans, letters of credit and letters of guarantee. The Bank generates almost all of its income from domestic markets. Within the scope of investment banking activities, the Bank’s treasury bills, government bond trading, repo transactions, money swaps and forward foreign exchange transactions, capital markets consultancy, financial consultancy, merger and purchase consultancy are performed. Among the investment banking operating income, revenues from Treasury transactions activities are included. As of 31 December 2024, explanations in line with segment reporting are shown below. 31 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION THREE (Continued) ACCOUNTING POLICIES (Continued) XXVI. Explanations on Segment Reporting (Continued) Investment Total Corporate Banking Banking Other Operations of Current Period (31.12.2024) (Treasury) the Group Net Interest Income/(Expense) 12.069.163 (782.521) (5.454) 11.281.188 Net Fees And Commissions Income/(Expense) (18.584) 220.623 45.203 247.242 Other Income 1.028.029 768.761 113.099 1.909.889 Other Expense (1.745.761) (1.262.241) (1.722.192) (4.730.194) Profit Before Tax 11.332.847 (1.055.378) (1.569.344) 8.708.125 Tax Provision - - (2.532.590) (2.532.590) Net Profit For The Period 11.332.847 (1.055.378) (4.101.934) 6.175.535 Group Profit / Loss 11.332.847 (1.055.378) (4.101.934) 6.175.535 Minority Rights Profit / Loss Current Period (31.12.2024) Segment Assets 58.667.080 94.176.590 740.213 153.583.883 Associates And Subsidiaries - 10.586 - 10.586 Total Assets 58.667.080 94.187.176 740.213 153.594.469 Segment Liabilities 5.727.176 125.732.076 2.129.817 133.589.069 Shareholders’ Equity - - 20.005.400 20.005.400 Total Liabilities 5.727.176 125.732.076 22.135.217 153.594.469 Investment Total Corporate Banking Other Operations of Banking Prior Period (31.12.2023) (Treasury) the Group Net Interest Income/(Expense) 7.853.610 (325.604) (2.995) 7.525.011 Net Fees And Commissions İncome/(Expense) (28.017) 121.482 43.564 137.029 Other Income 2.045.747 325.686 25.603 2.397.036 Other Expense - (3.249.643) (1.168.430) (4.418.073) Profit Before Tax 9.871.340 (3.128.079) (1.102.258) 5.641.003 Tax Provision - - (1.598.335) (1.598.335) Net Profit For The Period 9.871.340 (3.128.079) (2.700.593) 4.042.668 Group Profit / Loss 9.871.340 (3.128.079) (2.700.593) 4.042.668 Minority Rights Profit / Loss - - - - Prior Period (31.12.2023) Segment Assets 50.858.937 83.531.920 1.298.243 135.689.100 Associates And Subsidiaries - 10.586 - 10.586 Total Assets 50.858.937 83.542.506 1.298.243 135.699.686 Segment Liabilities 6.028.749 116.163.142 2.625.123 124.817.014 Shareholders’ Equity - - 10.882.672 10.882.672 Total Liabilities 6.028.749 116.163.142 13.507.795 135.699.686 32 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT I. Explanations Related to Consolidated Equity: Consolidated equity amount and capital adequacy standard ratio are calculated within the framework of ‘Regulation Regarding Equities of Banks’ and ‘Regulation Regarding Measurement and Evaluation of Banks’ Capital Adequacy’. The Group’s equity amount as of 31 December 2024 is TL 24.238.319, (31 December 2023: 19.762.269 TL) and its capital adequacy ratio is 17,98 % (31 December 2023:16,74%). The capital adequacy ratio of the Group is above the minimum ratio determined by the relevant legislation. Information on Equity Items: Current Period Prior Period (31.12.2024) (31.12.2023) Common Equity Tier I Capital Paid-in capital following all debts in terms of claim in liquidation of the Bank 5.706.074 2.706.074 Share issue premiums 5.421 4.038 Reserves 8.012.952 3.969.773 Gains recognized in equity as per TAS 136.994 208.244 Profit 6.175.535 4.042.957 Net profit for the period 6.175.535 4.042.668 Prior periods’ profit - 289 Shares acquired free of charge from subsidiaries, affiliates and jointly controlled partnerships and cannot be recognized within profit for the period 10.931 10.931 Minority Shares - - Common Equity Tier I Capital Before Deductions 20.047.907 10.942.017 Deductions from Common Equity Tier I Capital - - Valuation adjustments as per the 1st clause of Provisional Article 9 of the Regulation on the Equity of Banks - - Portion of the current and prior periods’ losses which cannot be covered through reserves and losses reflected in equity in accordance with TAS 50.933 1.240 Improvement costs for operating leasing 193 995 Goodwill (net of related tax liability) - - Other intangibles other than mortgage-servicing rights (net of related tax liability) 52.182 32.323 Deferred tax assets that rely on future profitability excluding those arising from temporary differences (net of related tax liability) - - Differences arise when assets and liabilities not held at fair value, are subjected to cash flow hedge accounting - - Total expected loss calculated according to the Regulation on Calculation of Credit Risk by Internal Ratings Based Approach that exceed total expected loss - - 33 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) I. Explanations Related to Consolidated Equity (Continued) Information on Consolidated Equity Items (Continued): Gains arising from securitization transactions - - Unrealized gains and losses due to changes in own credit risk on fair valued liabilities of the Bank - - Defined-benefit pension fund net assets - - Direct and indirect investments of the Bank in its own Common Equity - - Shares obtained contrary to the 4th clause of the 56th Article of the Law - - Portion of the total of net long positions of investments made in equity items of banks and financial institutions outside the scope of consolidation where the Bank owns 10% or less of the issued common share capital exceeding 10% of Common Equity of the Bank - - Portion of the total of net long positions of investments made in equity items of banks and financial institutions outside the scope of consolidation where the Bank owns 10% or more of the issued common share capital exceeding 10% of Common Equity of the Bank - - Portion of mortgage servicing rights exceeding 10% of the Common Equity - - Portion of deferred tax assets based on temporary differences exceeding 10% of the Common Equity - - Amount exceeding 15% of the common equity as per the 2nd clause of the Provisional Article 2 of the Regulation on the Equity of Banks - - Excess amount arising from the net long positions of investments in common equity items of banks and financial institutions outside the scope of consolidation where the Bank owns 10% or more of the issued common share capital - - Excess amount arising from mortgage servicing rights - - Excess amount arising from deferred tax assets based on temporary differences 479.355 324.243 Other items to be defined by the BRSA - - Deductions to be made from common equity due to insufficient Additional Tier I Capital or Tier II Capital - - Total Deductions From Common Equity Tier I Capital 582.663 358.801 Total Common Equity Tier I Capital 19.465.244 10.583.216 ADDITIONAL TIER I CAPITAL Preferred stock not included in Common Equity Tier I Capital and the related share premiums - - Debt instruments and premiums approved by BRSA 1.500.000 6.384.375 Debt instruments and premiums approved by BRSA (Temporary Article 4) - - Shares of Third Parties in Additional Tier 1 Capital - - Shares of Third Parties in Additional Tier 1 Capital (Those within the scope of Temporary Article 3) - - Additional Tier 1 Capital Before Deductions 1.500.000 6.384.375 Deductions From Additional Tier 1 Capital - - Direct and indirect investments of the Bank in its own Additional Tier I Capital - - Investments of the Bank in equity instruments with the conditions declared in Article 7 issued by banks and financial institutions invested in the Bank’s Additional Tier I Capital - - Total of net long positions of the ınvestments in equity ıtems of unconsolidated banks and financial ınstitutions where the bank owns 10% or less of the ıssued share capital exceeding the 10% threshold of above Common Equity Tier I Capital - - 34 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) I. Explanations Related to Consolidated Equity (Continued) Information on Consolidated Equity Items (Continued): Total of net long position of the direct or ındirect ınvestments in Additional Tier I Capital of unconsolidated banks and financial ınstitutions where the Bank owns more than 10% of the issued share capital - - Other items to be defined by the BRSA - - Items to be Deducted from Tier I Capital during the Transition Period - - Goodwill and other intangible assets and related deferred tax liabilities which is not deducted from Common Equity Tier I capital for the purposes of the first sub-paragraph of the Provisional Article 2 of the Regulation on Banks’ Own Funds (-) - - Net deferred tax asset/liability which is not deducted from Common Equity Tier I capital for the purposes of the sub-paragraph of the Provisional Article 2 of the Regulation on Banks’ Own Funds (-) - - Deduction from Additional Tier I Capital when there is not enough Tier II Capital (-) - - Total Deductions from Additional Tier I Capital - - Total Additional Tier I Capital 1.500.000 6.384.375 Total Tier I Capital (Tier I Capital= Common Equity Tier I Capital + Additional Tier I Capital) 20.965.244 16.967.591 TIER II CAPITAL Debt instruments and share issue premiums deemed suitable by the BRSA 2.060.311 1.827.616 Debt instruments and share issue premiums deemed suitable by BRSA (Temporary Article 4) - - Shares of Third Parties in the contribution capital - - Shares of Third Parties in the contribution capital (within the scope of Temporary Article 3) - - Provisions (Article 8 of the Regulation on Own Funds of Banks) 1.212.764 967.062 Tier II Capital Before Deductions 3.273.075 2.794.678 Deductions from Tier II Capital - - Direct and indirect investments of the Bank in its own Tier II Capital (-) - - Investments of the Bank in equity instruments with the conditions declared in Article 8 issued by banks and financial institutions invested in the Bank’s Tier II Capital - - Portion of the total of net long positions of investments made in equity items of banks and financial institutions outside the scope of consolidation where the Bank owns 10% or less of the issued common share capital exceeding 10% of Common Equity of the Bank (-) - - Portion of the total of net long positions of investments made in Tier II Capital item of banks and financial institutions outside the scope of consolidation where the Bank owns 10% or more of the issued common share capital - - Other items to be defined by the BRSA (-) - - Total Deductions from Tier II Capital - - Total Tier II Capital 3.273.075 2.794.678 Total Capital (The sum of Tier I Capital and Tier II Capital) 24.238.319 19.762.269 Total Tier I Capital and Tier II Capital (Total Capital) - - Loans granted contrary to the 50th and 51th Article of the Law - - Net book values of movables and immovables exceeding the limit defined in the article 57, clause 1 of the Banking Law and the assets acquired against overdue receivables and held for sale but retained more than five years - - Other items to be defined by the BRSA (-) - - 35 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) I. Explanations Related to Consolidated Equity (Continued) Information on Consolidated Equity Items (Continued): Items to be Deducted from the Sum of Tier I and Tier II Capital (Capital) During the Transition Period - - The portion of total of net long positions of the investments in equity items of unconsolidated banks and financial institutions where the bank owns 10% or less of the issued share capital exceeding the 10% threshold of above Tier I Capital not deducted from Tier I Capital, Additional Tier I Capital or Tier II Capital as per the Temporary Article 2, Clause 1 of the Regulation - - The portion of total of net long positions of the investments in equity items of unconsolidated banks and financial institutions where the bank owns more than 10% of the issued share capital exceeding the 10% threshold of above Tier I Capital not deducted from Additional Tier I Capital or Tier II Capital as per the Temporary Article 2, Clause 1 of the Regulation - - The portion of net long position of the investments in equity items of unconsolidated banks and financial institutions where the bank owns 10% or more of the issued share capital, of the net deferred tax assets arising from temporary differences and of the mortgage servicing rights not deducted from Tier I Capital as per the Temporary Article 2, Clause 2, Paragraph (1) and (2) and Temporary Article 2, Clause 1 of the Regulation - - CAPITAL Total Capital ( Total of Tier I Capital and Tier II Capital ) 24.238.319 19.762.269 Total Risk Weighted Amounts 134.789.354 118.075.918 CAPITAL ADEQUACY RATIOS Consolidated CET1 Capital Ratio (%) 14,44 8,96 Consolidated Tier I Capital Ratio (%) 15,55 14,37 Capital Adequacy Ratio (%) 17,98 16,74 BUFFERS Total additional Common Equity Tier I Capital requirement ratio 2,5 2,5 Capital conservation buffer ratio (%) 2,5 2,5 Bank-specific counter-cyclical capital buffer ratio (%) - - Systemic significant bank buffer ratio (%) - - The ratio of additional Common Equity Tier I Capital which will be calculated by the first paragraph of the Article 4 of Regulation on Capital Conservation and Countercyclical Capital Buffers to Risk Weighted Assets (%) - - Amounts Lower Than Excesses as per Deduction Rules - - Portion of the total of net long positions of investments in equity items of unconsolidated banks and financial institutions where the Bank owns 10% or less of the issued share capital - - Portion of the total of net long positions of investments in Common Equity Tier I Capital items of unconsolidated banks and financial institutions where the Bank owns more than 10% of the issued share capital - - 36 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) I. Explanations Related to Consolidated Equity (Continued) Information on Consolidated Equity Items (Continued): Amount arising from mortgage-servicing rights - - Amount arising from deferred tax assets based on temporary differences - - Limits for Provisions Used in Tier II Capital Calculation - - General loan provisions for exposures in standard approach (before limit of one hundred and twenty-five per ten thousand) 1.212.764 967.062 General loan provisions for exposures in standard approach limited by 1,25% of risk weighted assets 1.212.764 967.062 Total loan provision that exceeds total expected loss calculated according to Communiqué on Calculation of Credit Risk by Internal Ratings Based Approach 519.724 387.505 Total loan provision that exceeds total expected loss calculated according to Communiqué on Calculation of Credit Risk by Internal Ratings Based Approach, limited by 0,6% risk weighted assets - - Debt Instruments Covered by Temporary Article 4 - - (effective between 1.1.2018-1.1.2022) - - Upper limit for Additional Tier I Capital items subject to Temporary Article 4 - - Amount of Additional Tier I Capital items subject to Temporary Article 4 that exceeds upper limit - - Upper limit for Tier II Capital items subject to Temporary Article 4 - - Amount of Tier II Capital items subject to Temporary Article 4 that exceeds upper limit - - 37 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) I. Explanations Related to Consolidated Equity (Continued) Explanations on the reconciliation of consolidated capital items to balance sheet: Balance Sheet Amount of Value at Capital Current Period (31.12.2024) Value Adjustment Report 1.Paid-in-Capital 5.500.000 206.074 5.706.074 2.Capital Reserves 211.495 (206.074) 5.421 2.1. Share Premium 5.421 - 5.421 2.2. Share Cancellation Profits - - - 2.3. Other Capital Reserves 206.074 (206.074) - 3.Accumulated Other Comprehensive Income or Loss that will not be Reclassified to Profit or Loss 2.483 - 2.483 4. Accumulated Other Comprehensive Income or Loss that will be Reclassified to Profit or Loss 102.935 44.990 147.925 5.Profit Reserves 8.012.952 - 8.012.952 6.Profit or Loss 6.175.535 - 6.175.535 6.1. Prior Periods’ Profit/(Loss) - - - 6.2. Current Period Profit/(Loss) 6.175.535 - 6.175.535 Deductions from Common Equity Tier I Capital (-) - (585.146) (585.146) Common Equity Tier I Capital 20.005.400 (540.156) 19.465.244 Subordinated Loans - 1.500.000 1.500.000 Deductions from Tier I capital (-) - - - Tier I Capital 20.005.400 959.844 20.965.244 Subordinated Loans - 2.060.311 2.060.311 General Provisions - 1.212.764 1.212.764 Deductions from Tier II capital (-) - - - Tier II Capital - 3.273.075 3.273.075 Deductions from Total Capital (-) - - - Total 20.005.400 4.232.919 24.238.319 38 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) I. Explanations Related to Consolidated Equity (Continued): Explanations on the reconciliation of consolidated capital items to balance sheet (Continued): Balance Sheet Amount of Value at Prior Period (31.12.2023) Value Adjustment Capital Report 1.Paid-in-Capital 2.500.000 206.074 2.706.074 2.Capital Reserves 210.112 (206.074) 4.038 2.1. Share Premium 4.038 - 4.038 2.2. Share Cancellation Profits - - - 2.3. Other Capital Reserves 206.074 (206.074) - 3.Accumulated Other Comprehensive Income or Loss that will not be Reclassified to Profit or Loss (506) - (506) 4. Accumulated Other Comprehensive Income or Loss that will be Reclassified to Profit or Loss 160.336 58.839 219.175 5.Profit Reserves 3.969.773 - 3.969.773 6.Profit or Loss 4.042.957 - 4.042.957 6.1. Prior Periods’ Profit/(Loss) 289 - 289 6.2. Current Period Profit/(Loss) 4.042.668 - 4.042.668 Deductions from Common Equity Tier I Capital (-) - (358.295) (358.295) Common Equity Tier I Capital 10.882.672 (299.456) 10.583.216 Subordinated Loans - 6.384.375 6.384.375 Deductions from Tier I capital (-) - - - Tier I Capital 10.882.672 6.084.919 16.967.591 Subordinated Loans - 1.827.616 1.827.616 General Provisions - 967.062 967.062 Deductions from Tier II capital (-) - - - Tier II Capital - 2.794.678 2.794.678 Deductions from Total Capital (-) - - - Total 10.882.672 8.879.597 19.762.269 39 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) I. Explanations Related to Consolidated Equity (Continued): Information on borrowing instruments to be included in the consolidated equity calculation: Current Period (31.12.2024) Bank / Republic of Türkiye Issuer-Loan supplier Ministry of Treasury and Finance Identifier (CUSIP, ISIN etc.) - Governing law (s) of the instrument BRSA Regulatory treatment Subject to 10% deduction as of 1/1/2015 No Unconsolidated and Eligible on unconsolidated and /or consolidated basis Consolidated Instrument type Loan Amount recognized in regulatory capital (Currency in TL million, as of most recent reporting date) 2.060 Nominal value of instrument (TL million) 2.060 Accounting classification of the instrument Liabilities Subordinated Loan Original date of issuance 31.12.2018 Maturity structure of the instrument (perpetual/dated) Perpetual Starting maturity of the instrument - Issuer call subject to prior supervisory (BRSA) approval Yes Call option dates, conditioned call dates and call amount - Subsequent call dates, if applicable - Interest / dividend payments Fixed or floating coupon/dividend payments - Interest rate and related index value - Existence of any dividend payment restriction - Fully discretionary, partially discretionary or mandatory - Existence of step up or other incentive to redeem - Noncumulative or cumulative - Convertible into equity shares If convertible, conversion trigger(s) - If convertible, fully or partially - If convertible, conversion rate - If convertible, mandatory or optional conversion - If convertible, type of instrument convertible into - If convertible, issuer of instrument to be converted into - Write-down feature If bonds can be written down, write down trigger(s) - If bond can be written-down, full or partial - If bond can be written-down, permanent or temporary - If temporary write-down, description of write-up mechanism - After borrowings, before the Position in subordination hierarchy in case of liquidation (instrument type immediately senior additional capital, same as Tier II to the instrument) Capital Complies with the requirements of Article 8 of the Regulation on In compliance with article number 7 and 8 of Regulation on Bank Capital Equity of Banks. Complies with the requirements of Article 8 of the Regulation on Details of incompliances with article number 7 and 8 of Regulation on Bank Capital Equity of Banks. 40 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) I. Explanations Related to Consolidated Equity (Continued): Information on borrowing instruments to be included in the consolidated equity calculation (Continued): Prior Period (31.12.2023) Bank / Republic of Issuer-Loan supplier Türkiye Ministry of Treasury and Finance Identifier (CUSIP, ISIN etc.) - Governing law (s) of the instrument BRSA Regulatory treatment Subject to 10% deduction as of 1/1/2015 No Unconsolidated and Eligible on unconsolidated and /or consolidated basis Consolidated Instrument type Loan Amount recognized in regulatory capital (Currency in TL million, as of most recent reporting date) 1.828 Nominal value of instrument (TL million) 1.828 Liabilities Accounting classification of the instrument Subordinated Loan Original date of issuance 31.12.2018 Maturity structure of the instrument (perpetual/dated) Perpetual Starting maturity of the instrument - Issuer call subject to prior supervisory (BRSA) approval Yes Call option dates, conditioned call dates and call amount - Subsequent call dates, if applicable - Interest / dividend payments Fixed or floating coupon/dividend payments - Interest rate and related index value - Existence of any dividend payment restriction - Fully discretionary, partially discretionary or mandatory - Existence of step up or other incentive to redeem - Noncumulative or cumulative - Convertible into equity shares If convertible, conversion trigger (s) - If convertible, fully or partially - If convertible, conversion rate - If convertible, mandatory or optional conversion - If convertible, type of instrument convertible into - If convertible, issuer of instrument to be converted into - Write-down feature If bonds can be written-down, write-down trigger(s) - If bond can be written-down, full or partial - If bond can be written-down, permanent or temporary - If temporary write-down, description of write-up mechanism - After borrowings, before Position in subordination hierarchy in case of liquidation (instrument type immediately senior to the the additional capital, instrument) same as Tier II Capital Complies with the requirements of Article 8 of the Regulation on In compliance with article number 7 and 8 of Regulation on Bank Capital Equity of Banks. Complies with the requirements of Article 8 of the Regulation on Details of incompliances with article number 7 and 8 of Regulation on Bank Capital Equity of Banks. 41 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) I. Explanations Related to Consolidated Equity (Continued): Information on borrowing instruments to be included in the equity calculation (Continued): Current Period (31.12.2024) Issuer-Loan supplier Bank / TWF Identifier (CUSIP, ISIN etc.) - Governing law (s) of the instrument BRSA Regulatory treatment Subject to 10% deduction as of 1/1/2015 No Unconsolidated and Eligible on unconsolidated and /or consolidated basis Consolidated Instrument type Loan Amount recognized in regulatory capital (Currency in TL million, as of most recent reporting date) 1.500 (in 3 tranches) Nominal value of instrument (TL million) 1.500 (in 3 tranches) Liabilities Accounting classification of the instrument Subordinated Loan Original date of issuance 09.03.2022 Maturity structure of the instrument (perpetual/dated) Perpetual Starting maturity of the instrument - Issuer call subject to prior supervisory (BRSA) approval Yes 11-12-13 years at the Call option dates, conditioned call dates and call amount earliest in tranches Subsequent call dates, if applicable - Interest / dividend payments Fixed or floating coupon/dividend payments Variable interest rate 0% Real interest rate Interest rate and related index value and CPI indexed Existence of any dividend payment restriction - Fully discretionary, partially discretionary or mandatory - Existence of step up or other incentive to redeem - Noncumulative or cumulative - Convertible into equity shares If convertible, conversion trigger (s) - If convertible, fully or partially - If convertible, conversion rate - If convertible, mandatory or optional conversion - If convertible, type of instrument convertible into - If convertible, issuer of instrument to be converted into - Write-down feature Tier I capital adequacy ratio or consolidated Tier I capital adequacy If bonds can be written-down, write-down trigger(s) ratio falls below 5.125% If bond can be written-down, full or partial Partially or completely If bond can be written-down, permanent or temporary Temporary If temporary write-down, description of write-up mechanism Available Position in subordination hierarchy in case of liquidation (instrument type immediately senior to the After senior creditors instrument) and Tier II Capital Complies with the requirements of Article 7 of the Regulation on In compliance with article number 7 and 8 of Regulation on Bank Capital Equity of Banks. Complies with the requirements of Article 7 of the Regulation on Details of incompliances with article number 7 and 8 of Regulation on Bank Capital Equity of Banks. 42 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) I. Explanations Related to Consolidated Equity (Continued): Information on borrowing instruments to be included in the equity calculation (Continued): Prior Period (31.12.2023) Issuer-Loan supplier Bank / TWF Identifier (CUSIP, ISIN etc.) - Governing law (s) of the instrument BRSA Regulatory treatment Subject to 10% deduction as of 1/1/2015 No Unconsolidated and Eligible on unconsolidated and /or consolidated basis Consolidated Instrument type Loan Amount recognized in regulatory capital (Currency in TL million, as of most recent reporting date) 1.500 (in 3 tranches) Nominal value of instrument (TL million) 1.500 (in 3 tranches) Liabilities Accounting classification of the instrument Subordinated Loan Original date of issuance 09.03.2022 Maturity structure of the instrument (perpetual/dated) Perpetual Starting maturity of the instrument - Issuer call subject to prior supervisory (BRSA) approval Yes 11-12-13 years at the Call option dates, conditioned call dates and call amount earliest in tranches Subsequent call dates, if applicable - Interest / dividend payments Fixed or floating coupon/dividend payments Variable interest rate 0% Real interest rate Interest rate and related index value and CPI indexed Existence of any dividend payment restriction - Fully discretionary, partially discretionary or mandatory - Existence of step up or other incentive to redeem - Noncumulative or cumulative - Convertible into equity shares If convertible, conversion trigger (s) - If convertible, fully or partially - If convertible, conversion rate - If convertible, mandatory or optional conversion - If convertible, type of instrument convertible into - If convertible, issuer of instrument to be converted into - Write-down feature Tier I capital adequacy ratio or consolidated Tier I capital adequacy ratio falls below If bonds can be written-down, write-down trigger(s) 5.125% If bond can be written-down, full or partial Partially or completely If bond can be written-down, permanent or temporary Temporary If temporary write-down, description of write-up mechanism Available Position in subordination hierarchy in case of liquidation (instrument type immediately senior to the After senior creditors instrument) and Tier II Capital Complies with the requirements of Article 7 of the Regulation on In compliance with article number 7 and 8 of Regulation on Bank Capital Equity of Banks. Complies with the requirements of Article 7 of the Regulation on Details of incompliances with article number 7 and 8 of Regulation on Bank Capital Equity of Banks. 43 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) II. Explanations Related to Consolidated Credit Risk Credit risk refers to the possibility of losses that the Parent Bank may incur due to the loan customer's inability to fulfill its obligations partially or completely on time by not complying with the requirements of the concluded contract. The Bank ensures that credit risk is managed in accordance with the volume, nature and complexity of its loans within the framework of the legal regulations and restrictions of the BRSA, taking into account the best practices. The most basic banking service that the Parent Bank uses to finance medium and long term investments, which is its main function, is “project evaluation-based lending activity”. Taking into account the proportional size within the balance sheet structure, credit risk constitutes the most important risk item of the Bank. The general principle of the risk policies to be followed by the Parent Bank is to specialize in the activities that are in accordance with the tasks, vision and structure determined by the Establishment Law, to take risks that can be defined, controlled and/or managed in this sense, to make an effort not to take risks other than the risks that occur due to the structure of its activities and are inevitable. Based on the basic principle of ensuring that the risks to be taken in this context are also defined and manageable risks, the Bank has only manageable risks depending on the sensitivity shown to ensure that credit facilities are compatible with the credit source conditions, except for the credit risk and counterparty risk that occur and are unavoidable due to the need for lending. In the Parent Bank that has a fully functioning mechanisms based on activities, actively used committees and risk budgeting practices in decision-making and risk management processes, Credit Evaluation Committee continues its activities in order to determine the procedures and principles of the Bank's crediting, to evaluate the projects to be credited within the scope of the Bank's Environmental and Social Policy, to ensure coordination between the units in charge of credit transactions, to assess credit risk and the condition of the loan portfolio, to take decisions on loan allocation, postponement of loan receivables, installments, reorganization of conditions, the procedures and principles regarding the Bank's loan policies, to increase the efficiency of the loan portfolio within the framework of changing and developing conditions and to determine strategies for customers in trouble / legal follow-up. The majority of the Parent Bank’s loan placements are allocated with the approval of the Credit Evaluation Committee and the Board of Directors in accordance with the reports prepared by the Financial Analysis and Valuation Unit and the Credit Allocation Unit in accordance with the relevant legal regulations. Since the Bank’s placements are in the form of project financing, the amount of loans that can be extended to a company is mainly determined as a result of project evaluation studies, and loan disbursements are made in a controlled manner and by monitoring expenditures. As for the companies that have been granted loans by the Parent Bank, whose loans have been postponed or connected to the payback plan, the financial data of the companies are regularly monitored until the collection and liquidation of the risk is completed. For companies whose risk exceeds a certain amount or where there is a need for on-site inspection, inspection and determination are carried out both at the company headquarters and at the site of the facility. A Monitoring Report is being prepared, including the recommendations developed as a result of the reviews and evaluations. The credit worthiness of the borrowers of loans and other receivables is monitored regularly in accordance with the relevant legislation, and in case of an increase in the risk level of the loan borrower, the credit limits are reviewed and additional collateral is obtained if necessary. 44 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) II. Explanations Related to Consolidated Credit Risk (Continued) In the utilization of the provided resources, the sectors suitable for the borrowing conditions are determined and credited. By monitoring the sectoral distribution of loan customers, this distribution is taken into account in placement decisions and goals. The Parent Bank ensures that credit risk is managed in accordance with the volume, nature and complexity of its loans within the framework of the legal regulations and restrictions of the BRSA, taking into account the best practices. The Bank provides the identification, measurement and management of the credit risks contained in all of its products and activities, without being limited to credit products only. The issue of whether the credit decision support systems are compatible with the structure, size and complexity of the Parent Bank's activities is constantly reviewed, developed and adjustments are made to the system when necessary by the Board of Directors. The Parent Bank is registered under Article 54 of the Banking Law No. 5411. it is not subject to the general credit restrictions defined in the article. However, in the Bank's “Loans Policy” and “Risk Limits and Application Principles” documents, it has defined loan restrictions parallel to the restrictions contained in the law. In order to determine the level of credit risk that the Bank may face, the Risk Management Unit actively participates in the measurement, analysis and monitoring process and regularly reports to the Board of Directors and the Audit Committee to Senior Management. Within the framework of the policies determined within the scope of the BRSA Accounting and Financial Reporting Legislation; The Parent Bank evaluates its financial assets in 3 stages within the scope of TFRS 9. In this context, for defaulted loans (3.Stage) and loans that have not yet defaulted, but which have significantly increased credit risk of the loan’s disbursement (2.Stage), the Parent Bank calculates the expected lifetime credit loss. For other financial assets covered by TFRS 9 (1.Stage) the Bank reflects the calculation containing the probability of default within 12 months after the reporting date as the expected loss provision. Futures and other derivative product transactions are carried out at the Bank within the framework of asset-liability management, taking into account the legal limits. The credit risk assumed due to such transactions is managed together with the potential risks arising from market movements. There is no option agreement in the Parent Bank. In accordance with the TFRS 9 Policy approved by the Board of Directors, the Bank allocates provisions as stipulated in the “Regulation on the Classification of Loans and the Procedures and Principles Related to the Provisions to be Allocated for Them” and the “Communiqué on the Turkish Financial Reporting Standard for TFRS 9 Financial Instruments”. 45 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) II. Explanations Related to Consolidated Credit Risk (Continued) Current Period Prior Period (31.12.2024) (31.12.2023) Risk Categories Average Average Risk Risk Risk Risk Amount(*) Amount Amount(*) Amount Conditional and unconditional receivables to central governments or central banks 14.046.693 17.863.858 15.426.669 14.233.890 Conditional and unconditional receivables to banks and brokerage houses 26.097.533 25.706.927 32.061.878 33.547.570 Conditional and unconditional corporate receivables 92.095.778 83.508.118 77.072.807 64.164.312 Conditional and unconditional retail receivables - - - - Conditional and unconditional receivables secured by real estate property 5.484.131 3.340.207 2.777.807 1.843.164 Overdue receivables 156.399 239.745 319.302 323.958 Receivables defined in high risk category by BRSA - - - - Receivables as a collective investment establishment 224.359 237.077 228.491 174.264 Other receivables 1.060.929 944.709 606.148 449.655 (*) Includes risk amounts before the effect of credit risk mitigation but after the credit conversions. Restructured loans whose amortization schedule has been changed are followed in the accounts which are specified by related regulations and monitored in accordance with the Parent Bank Bank’s credit risk policies. Accordingly, commercial activities of debtors are analyzed and repayments are monitored whether they are in line with the repayments schedules or not, and necessary precautions are taken. Since the Parent Bank does not have any risks within the scope of private sector loans and trading accounts in banking accounts in other countries, cyclical capital buffer is not calculated. a) The share of the Parent Bank’s receivables from the first 100 and 200 cash loan customers in the total cash loan portfolio is 91,70% and 99,43%, respectively (31 December 2023: 86,60% and 98,02%). b) The share of cash and non-cash receivables from the Parent Bank's first 100 and 200 loan customers in total on-balance sheet and off-balance sheet assets is 57,99% and 62,61%, respectively (31 December 2023: 55,61% and 62,50%). c) The share of the Parent Bank’s receivables from the first 100 and 200 non-cash loan customers in the total non-cash loan portfolio is 100% (31 December 2023: 100%). The allocated expected credit loss provision for 1. and 2. Stage is TL 1.126.705 (31 December 2023: TL 892.314). The expected loss provisions were not taken into account in the calculation of the above-mentioned ratios. 46 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) II. Explanations Related to Consolidated Credit Risk (Continued) Profile of Significant Risks in Important Regions Risk Categories (***) Receiva bles Conditional Conditional Defined Conditional and and and Non- Under Unconditional Unconditional Conditional Conditional High Collective Receivables Receivables and Real Estate Risk Investment from Central from Banks Unconditional Mortgage- Category Institution Governments or and Brokerage Corporate Secured Overdue By The Like Other Central Banks Houses Receivables Receivables Receivables Board Investments Receivables Current Period (31.12.2024) Domestic 14.046.693 26.028.158 92.095.778 5.484.131 156.399 - - - European Union (EU) Countries - 274 - - - - 224.359 - OECD Countries (*) - 69.101 - - - - - - Off-Shore Banking Regions - - - - - - - - USA, Canada - - - - - - - - Other Countries - - - - - - - - Associates, Subsidiaries and Joint –Ventures - - - - - - - 54.612 Unallocated Assets (**) - - - - - - - 1.006.317 Total 14.046.693 26.097.533 92.095.778 5.484.131 156.399 - 224.359 1.060.929 Prior Period (31.12.2023) Domestic 15.426.669 31.989.834 77.072.807 2.777.807 319.302 - - - European Union (EU) Countries - 12 - - - - 228.491 - OECD Countries (*) - 72.032 - - - - - - Off-Shore Banking Regions - - - - - - - - USA, Canada - - - - - - - - Other Countries - - - - - - - - Associates, Subsidiaries and Joint –Ventures - - - - - - - 10.586 Unallocated Assets (**) - - - - - - - 595.562 Total 15.426.669 32.061.878 77.072.807 2.777.807 319.302 - 228.491 606.148 (*) OECD countries other than EU countries, USA and Canada. (**) Asset and liability items that can not be allocated on a consistent basis. (***) Includes risk amounts before the effect of credit risk mitigation but after the credit conversions. 47 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) II. Explanations Related to Consolidated Credit Risk (Continued) Risk profile by sectors or counterparties: Conditional and Conditional and Unconditional Unconditional Current Period Receivables from Receivables from Conditional and Conditional and Non- Collective (31 December 2024) Central Banks and Unconditional Conditional Real Investment Governments or Brokerage Corporate Estate Mortgage- Overdue Institution Like Other Central Banks Houses Receivables Secured Receivables Receivables Investments Receivables TL FC TOTAL Agriculture - - 333.511 90.361 - - - 350.074 73.798 423.872 Farming and Stockbreeding - - - - - - - - - - Forestry - - - 55.308 - - - - 55.308 55.308 Fishery - - 333.511 35.053 - - - 350.074 18.490 368.564 Manufacturing - - 76.720.881 4.432.006 135.782 - - 20.728.893 60.559.776 81.288.669 Mining and Quarrying - - - - - - - - - - Production - - 27.388.337 4.134.939 - - - 17.651.867 13.871.409 31.523.276 Electricity, Gas, Water - - 49.332.544 297.067 135.782 - - 3.077.026 46.688.367 49.765.393 Construction - - 762.291 890.950 - - - 624.531 1.028.710 1.653.241 Services 14.046.693 26.097.533 14.279.095 70.814 20.617 224.359 1.060.929 33.770.507 22.029.533 55.800.040 Wholesale and Retail Trade - - - - - - - - - - Accommodation and Dining - 4 780.653 70.814 20.617 - - 525.382 346.706 872.088 Transportation and Telecommunication - - 2.083.182 - - - - 111.429 1.971.753 2.083.182 Financial Institutions 14.046.693 26.097.529 11.264.405 - - 224.359 1.060.929 33.128.132 19.565.783 52.693.915 Real Estate and Rental Services - - - - - - - - - - Professional Services - - - - - - - - - - Educational Services - - 17.514 - - - - 5.564 11.950 17.514 Health and Social Services - - 133.341 - - - - - 133.341 133.341 Others - - - - - - - - - - Total 14.046.693 26.097.533 92.095.778 5.484.131 156.399 224.359 1.060.929 55.474.005 83.691.817 139.165.822 There are no balances in the following classes. 2-Conditional and unconditional receivables from regional or local governments 3- Conditional and unconditional receivables from administrative units and non-commercial enterprises 4- Conditional and unconditional receivables from multilateral development banks 5- Conditional and unconditional receivables from international organizations 8- Conditional and unconditional retail receivables 11-Receivables determined to be high risk by the Board 12-Mortgage secured securities 13-Securitization positions 14-Short-term receivables from banks and intermediary institutions and short-term corporate receivables 16-Stock Investments 48 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) II. Explanations Related to Consolidated Credit Risk (Continued) Risk profile by sectors or counterparties: Conditional and Unconditional Conditional and Prior Period Receivables from Unconditional Conditional and Conditional and Non- Collective (31 December 2023) Central Receivables from Unconditional Conditional Real Investment Governments or Banks and Corporate Estate Mortgage- Overdue Institution Like Other Central Banks Brokerage Houses Receivables Secured Receivables Receivables Investments Receivables TL FC TOTAL Agriculture - - 465.449 42.713 - - - 376.519 131.643 508.162 Farming and Stockbreeding - - - - - - - - - - Forestry - - 39.078 42.713 - - - - 81.791 81.791 Fishery - - 426.371 - - - - 376.519 49.852 426.371 Manufacturing - - 73.358.635 2.030.894 269.060 - - 16.999.206 58.659.383 75.658.589 Mining and Quarrying - - 395.088 - - - - 2.486 392.602 395.088 Production - - 28.084.495 1.706.576 112 - - 13.751.249 16.039.934 29.791.183 Electricity, Gas, Water - - 44.879.052 324.318 268.948 - - 3.245.471 42.226.847 45.472.318 Construction - - 492.905 517.724 - - - 908.459 102.170 1.010.629 Services 15.426.669 32.061.878 2.755.818 186.476 50.242 228.491 606.148 30.572.274 20.743.448 51.315.722 Wholesale and Retail Trade - - - - - - - - - - Accommodation and Dining - 4 999.876 171.530 50.242 - - 432.835 788.817 1.221.652 Transportation and Telecommunication - - 819.344 - - - - 161.412 657.932 819.344 Financial Institutions 15.426.669 32.061.874 609.260 - - 228.491 606.148 29.966.638 18.965.804 48.932.442 Real Estate and Rental Services - - - - - - - - - - Professional Services - - - - - - - - - - Educational Services - - 70.040 14.946 - - - 11.389 73.597 84.986 Health and Social Services - - 257.298 - - - - - 257.298 257.298 Others - - - - - - - - - - Total 15.426.669 32.061.878 77.072.807 2.777.807 319.302 228.491 606.148 48.856.458 79.636.644 128.493.102 There are no balances in the following classes. 2-Conditional and unconditional receivables from regional or local governments 3- Conditional and unconditional receivables from administrative units and non-commercial enterprises 4- Conditional and unconditional receivables from multilateral development banks 5- Conditional and unconditional receivables from international organizations 8- Conditional and unconditional retail receivables 11-Receivables determined to be high risk by the Board 12-Mortgage secured securities 13-Securitization positions 14-Short-term receivables from banks and intermediary institutions and short-term corporate receivables 16-Stock Investment 49 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) II. Explanations Related to Consolidated Credit Risk (Continued) Analysis of Maturity-Bearing Risks According to Remaining Maturities Risk Categories Term to Maturity Current Period Up to 1 Not Bearing (31.12.2024) Month 1-3 Months 3-6 Months 6-12 Months Over 1 Year Maturity Total Conditional and unconditional receivables from central governments or central banks 648.625 349.580 1.526.023 1.589.525 9.910.527 22.413 14.046.693 Conditional and unconditional receivables from banks and brokerage houses 15.656.064 3.378.606 3.387.191 98.566 1.824.311 1.752.795 26.097.533 Conditional and unconditional corporate receivables 1.302.884 2.621.052 5.311.699 8.702.432 74.008.221 149.490 92.095.778 Conditional and unconditional real estate mortgage-secured receivables 2.418 - 18.960 162.583 5.300.170 - 5.484.131 Overdue receivables - - - - - 156.399 156.399 Collective investment institution like investments - - - - - 224.359 224.359 Other receivables - - - - - 1.060.929 1.060.929 Total 17.609.991 6.349.238 10.243.873 10.553.106 91.043.229 3.366.385 139.165.822 Term to Maturity Risk Categories Up to 1 Over 1 Not Bearing Prior Period (31.12.2023) Month 1-3 Months 3-6 Months 6-12 Months Year Maturity Total Conditional and unconditional receivables from central governments or central banks 299.212 - 6.521.205 976.671 7.300.414 329.167 15.426.669 Conditional and unconditional receivables from banks and brokerage houses 17.147.732 4.379.716 1.791.284 1.852.639 5.632.450 1.258.057 32.061.878 Conditional and unconditional corporate receivables 954.052 3.520.489 3.658.011 8.090.808 60.849.447 - 77.072.807 Conditional and unconditional real estate mortgage-secured receivables 36.646 135.225 137.204 310.774 2.157.958 - 2.777.807 Overdue receivables - - - - - 319.302 319.302 Collective investment institution like investments - - - - - 228.491 228.491 Other receivables - - - - - 606.148 606.148 Total 18.437.642 8.035.430 12.107.704 11.230.892 75.940.269 2.741.165 128.493.102 Information on Risk Categories For the determination of risk weights for risk classes defined in the Article 6 of the “Regulation on Measurement and Assessment of Capital Adequacy of Banks”, all counterparties are treated as non-rated since no rating agency is authorized. 50 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) II. Explanations Related to Consolidated Credit Risk (Continued) Credit Risk by Risk Weights - Standard Approach(*) Current Period (31.12.2024) 0% 2% 10% 20% 25% 35% 50% 75% 100% 200% 250% Other Risk Deductions from Risk Weights Weights Equity Before Credit Risk Mitigation 11.959.597 303.590 - 14.388.189 - 45.350 11.733.974 - 100.736.674 - - - 52.318 After Credit Risk Mitigation 11.959.597 303.590 - 14.388.189 - 45.350 16.749.793 - 95.720.855 - - - - Prior Period (31.12.2023) 0% 2% 10% 20% 25% 35% 50% %75 100% 200% 250% Other Risk Deductions Risk Weights Weights from Equity Before Credit Risk Mitigation 9.095.069 244.686 - 15.219.014 - 51.762 7.922.062 - 95.960.509 - - - 32.252 After Credit Risk Mitigation 9.095.069 244.686 - 15.219.014 - 51.762 13.181.873 - 90.700.698 - - - - 51 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) II. Explanations Related to Consolidated Credit Risk (Continued) Miscellaneous Information According to Important Sectors or Counterparty Type: The Parent Bank classifies its loans and allocates provisions within the framework of TFRS 9 Policy approved by the Board of Directors. In this context, for impaired loans the Bank calculates lifetime expected credit loss and reflects it as provision when the credit risk of the loan has not yet gone into default but has increased significantly from the date of disbursement (Stage 2) and in case of default (Stage 3). The Bank has determined the “Significant Increase in Credit Risk” and “Classification” criteria in the TFRS 9 Provisions Methodology document approved by the Board of Directors, and its loans are classified and provisions are set aside in line with these criterias. Loans Provisions Impaired Loans (TFRS 9) Significant Increase Current Period (31.12.2024) in Default Expected Credit Loss Major Sectors / CounterParties Credit Risk (Stage 2) (Stage 3) Provisions (TFRS 9) Agriculture - - - Farming and Stockbreeding - - - Forestry - - - Fishery - - - Manufacturing 5.164.614 664.162 1.073.764 Mining and Quarrying - - - Production 35.151 20.006 20.267 Electricity, Gas and Water 5.129.463 644.156 1.053.497 Construction - - - Services 493.804 67.454 49.876 Wholesale and Retail Trade - - - Accommodation and Dining 45.220 63.343 44.009 Transportation and Telecommunication 315.243 8 1.410 Financial Institutions - - - Real Estate and Rental Services - - - Professional Services - - - Educational Services - - - Health and Social Services 133.341 4.103 4.457 Others - 1.134 1.134 Total 5.658.418 732.750 1.124.774 52 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) II. Explanations Related to Consolidated Credit Risk (Continued) Miscellaneous Information According to Important Sectors or Counterparty Type (Continued) Loans Provisions Impaired Loans (TFRS 9) Significant Increase Prior Period (31.12.2023) in Default Expected Credit Loss Major Sectors / CounterParties Credit Risk (Stage 2) (Stage 3) Provisions (TFRS 9) Agriculture - - - Farming and Stockbreeding - - - Forestry - - - Fishery - - - Manufacturing 3.130.758 751.728 745.794 Mining and Quarrying - - - Production 459.682 6.403 8.021 Electricity, Gas and Water 2.671.076 745.325 737.773 Construction - - - Services 271.652 95.220 49.572 Wholesale and Retail Trade - - - Accommodation and Dining 76.964 91.756 45.914 Transportation and Telecommunication - - - Financial Institutions - - - Real Estate and Rental Services - - - Professional Services - - - Educational Services 37.015 - 7 Health and Social Services 157.673 3.464 3.651 Others - 1.134 1.134 Total 3.402.410 848.082 796.500 Information on Movements in Value Adjustments and Provisions: Current Period Opening Provision for Provision Other Closing (31.12.2024) Balance Period Reversals Adjustments Balance 1. Stage 3 Provisions 528.780 90.946 (43.375) - 576.351 2. Stage 1 and 2 Provisions 892.314 349.851 (115.460) - 1.126.705 Prior Period Opening Provision for Provision Other Closing (31.12.2023) Balance Period Reversals Adjustments Balance 1. Stage 3 Provisions 567.821 42.357 (81.398) - 528.780 2. Stage 1 and 2 Provisions 539.816 363.744 (11.246) - 892.314 53 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) III. Explanations Related to Consolidated Currency Risk : The Parent Bank is exposed to currency risk because of inconsistency of the foreign currency denominated asset and liability balances with respect to the transactions made in foreign currencies. The currency risk management policy of the Bank is defined as, keeping the “Foreign Currency Net General Position/Equity Standard” ratio within the legal boundaries with respect to the economic matters, trends in the market and financial position of the Parent Bank. By keeping up with this main goal and with respect to asset and liability management, foreign currency denominated assets are appreciated with the most favorable interest rates in the foreign currency market. Currency risk is calculated within the scope of the standard method used for legal reporting. Besides, the exchange rate risk faced by the Parent Bank daily is determined by preparing the foreign currency balance sheet by covering individual positions. Proforma foreign currency balance sheets are used for the measurement of the future exchange rate risks (including foreign currency-indexed assets and liabilities). The Parent Bank has no hedging derivative instruments for foreign currency denominated borrowings and net foreign currency investments. A non-speculative foreign exchange position management policy is followed in order to limit the exposure of the currency risk. In this respect, distribution of foreign currency denominated on balance sheet and off-balance sheet items are considered. In order to reduce the risk of foreign exchange rate fluctuations affecting the financial structure of the Bank, the risk of foreign exchange rate of the Parent Bank is determined based on the Foreign Currency Net General Position/Equity ratio determined by the BRSA. The limit of the ratio has been determined as 10% effective from the decision date, as of the BRSA’s decision dated 9 March 2023 and numbered 10534. The foreign exchange buying rates of the Parent Bank as of the date of the financial statements and the last five business days prior to that date are as follows: Date USD EURO 100 JPY 31/12/2024 35,2898 36,7084 22,6057 30/12/2024 35,2392 36,7439 22,3514 27/12/2024 35,1614 36,5995 22,3346 26/12/2024 35,2341 36,6329 22,4335 25/12/2024 35,2058 36,6246 22,4298 The simple arithmetic average value of the Bank’s foreign exchange purchase rate for the last thirty days from the date of the financial statements is US Dollar: TL 34,9223, Euro: TL 36,5651, CHF: TL 39,2820. 54 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) III. Explanations Related to Consolidated Currency Risk (Continued): Information on the currency risk of the Parent Bank: Current Period (31.12.2024) EURO USD Other FC(*) Total Assets Cash (cash in vault, effectives, money in transit, cheques purchased) and balances with the Central Bank of the Republic of Türkiye - - - - Banks 362.235 1.293.944 3.364 1.659.543 Financial assets measured at fair value through profit and loss 224.299 56.405 - 280.704 Money market placements - - - - Financial assets measured at fair value through other comprehensive income 6.660.703 15.054.745 - 21.715.448 Loans 26.082.676 45.957.128 - 72.039.804 Subsidiaries, associates and jointly controlled entities (joint ventures) - - - - Financial assets measured at amortised cost 536.446 - - 536.446 Derivative financial assets held for trading - - - - Tangible assets - - - - Intangible assets - - - - Other assets 96.659 143.270 - 239.929 Total assets 33.963.018 62.505.492 3.364 96.471.874 Liabilities Interbank deposits - - - - Foreign currency deposits - - - - Money market borrowings 2.099 - - 2.099 Funds provided from other financial institutions 30.793.420 58.227.507 - 89.020.927 Securities issued 3.735.924 - - 3.735.924 Subordinated debt instruments 2.060.311 - - 2.060.311 Sundry creditors 10.919 104.079 - 114.998 Derivative financial liabilities held for trading - 3.507 - 3.507 Other liabilities 439.559 3.159.221 - 3.598.780 Total liabilities 37.042.232 61.494.314 - 98.536.546 Net balance sheet position (3.079.214) 1.011.178 3.364 (2.064.672) Net off-balance sheet position 3.046.797 (1.001.052) - 2.045.745 Assets on derivative instruments 3.046.797 4.058.327 - 7.105.124 Liabilities on derivative instruments - (5.059.379) - (5.059.379) Non-cash loans 2.298.219 2.627.754 - 4.925.973 Prior Period (31.12.2023) Total assets 34.328.407 52.772.408 1.995 87.102.810 Total liabilities 37.054.639 58.241.397 - 95.296.036 Net balance sheet position (2.726.232) (5.468.989) 1.995 (8.193.226) Net off-balance sheet position 3.239.969 4.860.455 - 8.100.424 Assets on derivative instruments 3.239.969 6.794.888 - 10.034.857 Liabilities on derivative instruments - (1.934.433) - (1.934.433) Non-cash loans 2.353.770 2.315.646 - 4.669.416 (*) The foreign currencies presented in the other FC column of assets comprise 47% GBP, 42% CHF and 11% JPY. 55 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) III. Explanations Related to Consolidated Currency Risk (Continued): Currency Risk Sensitivity: The table below shows the Bank’s sensitivity to the 10% change in the US Dollar and Euro exchange rates. Increase in Exchange Rates Effect on Profit/Loss (*) Effect on Shareholders’ Equity Current Period Prior Period Current Period Prior Period % (31.12.2024) (31.12.2023) (31.12.2024) (31.12.2023) USD 10 (7.020) 319.029 1.505.474 981.130 EURO 10 (4.354) 49.643 674.157 414.765 Other 10 336 200 - - (*) It refers to the values before the tax effect is deducted. Increase in Exchange Rates Effect on Profit/Loss (*) Effect on Shareholders’ Equity Current Period Prior Period Current Period Prior Period % (31.12.2024) (31.12.2023) (31.12.2024) (31.12.2023) USD 10 7.020 (319.029) (1.505.474) (981.130) EURO 10 4.354 (49.643) (674.157) (414.765) Other 10 (336) (200) - - (*) It refers to the values before the tax effect is deducted. 56 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) IV. Explanations Related to Consolidated Interest Rate Risk: Interest rate risk refers to the probability of losses that the Bank may incur due to movements in interest rates, depending on the position status of financial instruments. Changes in interest rates affect the level of return on assets and the cost of liabilities. The interest rate risk arising from banking accounts includes repricing risk, yield curve risk, base risk and optionality risk. Interest rates determined by market actors, especially central banks, have a decisive role on the economic value of the Parent Bank’s balance sheet and the Bank’s income-expense balance. Sudden interest rate shocks in the market causes the gap between the interest rate applied to the Parent Bank’s yielding assets and the interest rate paid to the cost-effective liabilities to be opened. The opening of this interest rate gap may cause the Parent Bank’s interest income to be negatively affected by fluctuations in market rates and the Bank’s profitability to decrease. The Parent Bank’s basic principle in the interest rate risk management policy is to avoid mismatch and provide alignment between loans disbursed with fixed and floating rate and funds provided with fixed and floating rate. Accordingly, interest rate, currency and maturity alignment are respected during the disbursement of loans funded by foreign long-term borrowings, which form the material part of the loan portfolio. Considering that material part of the entire loan portfolio consists of variable-rate loans and is financed by borrowing, changes in borrowing costs are reflected in variable-rate loans, and the other loans are financed by Bank equity, it is unlikely that there will be interest rate risk due to interest rate changes. Within the framework of the Parent Bank’s basic principle of interest rate risk policy, optimization of portfolio distribution in the management of interest-sensitive assets other than loans is provided by considering possible changes in duration of positions and current interest rate limits; by taking into account alternative return, limits of tolerable loss and risk. In this context, to measure the interest rate risk exposure of the Bank, the effect of days to maturity and profit/loss are analyzed considering the scenarios of possible changes in interest rates for securities portfolio. Alternatives for compensation of probable losses that may arise as a result of fluctuations in interest rates are examined using different markets. Interest rate sensitivity analysis is also made for the positions besides securities portfolio. There is no interest rate mismatch on loan portfolio as the main principle of interest rate adjustment on the source and disbursement side of the loan portfolio of the Bank. For this reason, the Bank's credit portfolio does not carry any interest rate risk even if it is affected by market volatility. Interest rate- sensitive items on the Bank's balance sheet are limited only to the size of the Financial Assets Measured at Fair Value Through Other Comprehensive Income within the liquid portfolio. In order to minimize the possibility of unfavorable effects of market interest rate changes on the Bank’s financial position, risk limits are used for the management of interest rate risk. These limits are set by Asset-Liability Committee and approved by Board of Directors. The Bank monitors and controls whether interest-sensitive assets are within the determined limits. In order to minimize the likelihood that the change in market interest rates in the bank's securities portfolio management will cause adverse effects on the financial structure of the bank, limits have been set on the adjusted duration of the securities portfolio and the amount of daily loss that may arise from the securities portfolio. 57 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) IV. Explanations Related to Consolidated Interest Rate Risk (Continued): Within the scope of the interest rate limits, the BHFoR early warning limit has been determined with a more cautious approach based on the legal ratio of “Standard Ratio for Interest Rate Risk Arising from Banking Accounts”, which is determined as 20% by the BRSA regarding the measurement and evaluation of interest rate risk arising from banking accounts with the standard shock method. Interest rate sensitivity of assets, liabilities and off-balance sheet items (based on days to repricing dates). 5 Years and Non-Interest End of the Current Period (31.12.2024) Up to 1 Month 1–3 Months 3–12 Months 1–5 Years Over Bearing Total Assets Cash (cash in vault, effectives, money in transit, cheques purchased) and balances with the Central Bank of the Republic of Türkiye (1) - - - - - 1.836 1.836 Banks (1) 12.637.012 - - - - 79.628 12.716.640 Financial assets measured at fair value through profit or loss - - - - - 696.997 696.997 Money market placements 9.918.269 - - - - - 9.918.269 Financial assets measured at fair value through other comprehensive income (3) 2.554.709 3.751.549 8.303.655 10.742.261 156.516 8.813 25.517.503 Loans (2) 19.865.266 21.012.207 18.285.097 7.964.007 25.826.803 156.399 93.109.779 Financial assets measured at amortised cost 646.816 349.580 1.894.602 1.914.385 5.572.121 - 10.377.504 Other assets (4) 144.142 - - - - 1.111.799 1.255.941 Total Assets (5) 45.766.214 25.113.336 28.483.354 20.620.653 31.555.440 2.055.472 153.594.469 Liabilities Interbank deposits - - - - - - - Other deposits - - - - - - - Money market borrowings 3.417.116 - - - - - 3.417.116 Miscellaneous payables - - - - - 171.549 171.549 Marketable securities issued - - 3.735.924 - - - 3.735.924 Funds provided from other financial institutions 7.017.242 35.113.999 31.616.580 8.222.600 29.703.938 - 111.674.359 Other liabilities (4) (6) 2.150.348 - 5.516.800 26.928.373 34.595.521 Total Liabilities 12.584.706 35.113.999 35.352.504 8.222.600 35.220.738 27.099.922 153.594.469 Long position on balance sheet 33.181.508 - - 12.398.053 - - 45.579.561 Short position on balance sheet - (10.000.663) (6.869.150) - (3.665.298) (25.044.450) (45.579.561) Long position on off-balance sheet 128.539 - - - - - 128.539 Short position on off-balance sheet - (34.644) - - - - (34.644) Total Position 33.310.047 (10.035.307) (6.869.150) 12.398.053 (3.665.298) (25.044.450) 93.895 (1) Balances without maturity are shown in “Non-interest Bearing” column. (2) Net balance of non-performing loans is shown in “Non-interest Bearing” column. (3) Securities representing share in capital are shown in “Non -interest Bearing” column. (4) Deferred tax asset, shareholders’ equity and other non-interest-bearing assets and liabilities are shown in “Non-Interest Bearing” column. (5) The expected credit losses for financial assets and other assets are reflected to the related items. (6) Subordinated loans are shown in the “Other Liabilities” line. 58 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) IV. Explanations Related to Consolidated Interest Rate Risk (Continued): Interest rate sensitivity of assets, liabilities and off-balance sheet items (based on days to repricing dates): Non- Up to 1 1–3 3–12 5 Years and Interest End of the Prior Period (31.12.2023) Month Months Months 1–5 Years Over Bearing Total Assets Cash (cash in vault, effectives, money in transit, cheques purchased) and balances with the Central Bank of the Republic of Türkiye (1) - - - - - 2.560 2.560 (1) Banks 4.844.282 10.088 - - - 80.879 4.935.249 Financial assets measured at fair value through profit or loss - - - - - 591.455 591.455 Money market placements 17.034.643 - - - - - 17.034.643 Financial assets measured at fair value through other comprehensive income (3) 1.203.398 1.904.250 6.601.145 5.435.363 58.097 18.362 15.220.615 (2) Loans 17.718.666 20.026.577 14.619.345 7.899.191 22.154.533 319.302 82.737.614 Financial assets measured at amortised cost 65.857 - 8.201.445 2.431.941 3.774.223 - 14.473.466 Other assets (4) 65.716 - - - - 638.368 704.084 (5) Total Assets 40.932.562 21.940.915 29.421.935 15.766.495 25.986.853 1.650.926 135.699.686 Liabilities Interbank deposits - - - - - - - Other deposits - - - - - - - Money market borrowings 2.874.989 - - - - - 2.874.989 Miscellaneous payables - - - - - 373.726 373.726 Marketable securities issued - - 4.176.377 - - - 4.176.377 Funds provided from other financial institutions 7.092.461 28.630.222 33.411.641 7.594.593 24.706.324 - 101.435.241 Other liabilities (4) 472.047 - 6.038.208 - 3.712.899 16.616.199 26.839.353 Total Liabilities 10.439.497 28.630.222 43.626.226 7.594.593 28.419.223 16.989.925 135.699.686 Long position on balance sheet 30.493.065 - - 8.171.902 - - 38.664.967 Short position on balance sheet - (6.689.307) (14.204.291) - (2.432.370) (15.338.999) (38.664.967) Long position on off-balance sheet - - - - - - - Short position on off-balance sheet - (33.007) (37.771) - - - (70.778) Total Position 30.493.065 (6.722.314) (14.242.062) 8.171.902 (2.432.370) (15.338.999) (70.778) (7) Balances without maturity are shown in “Non-interest Bearing” column. (8) Net balance of non-performing loans is shown in “Non-interest Bearing” column. (9) Securities representing share in capital are shown in “Non -interest Bearing” column. (10) Deferred tax asset, shareholders’ equity and other non-interest-bearing assets and liabilities are shown in “Non-Interest Bearing” column. (11) The expected credit losses for financial assets and other assets are reflected to the related items. (12) Subordinated loans are shown in the “Other Liabilities” line. 59 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) IV. Explanations Related to Consolidated Interest Rate Risk (Continued): Average interest rates applied to monetary financial instruments (%): End of the Current Period (31.12.2024) EURO USD JPY TL Assets (*) Cash (Cash in vault, effectives, money in transit, cheques purchased) and balances with the Central Bank of the Republic of Türkiye - - - - Banks 3,33 4,54 50,33 Financial assets measured at fair value through profit or loss - - - - Money market placements - - - 48,97 Financial assets measured at fair value through other comprehensive income 4,65 6,60 46,52 Loans 6,46 8,25 18,99 Other financial assets measured at amortised cost(**) 4,55 46,19 Liabilities (*) Interbank deposits - - - - Other deposits - - - - Money market borrowings - - - 47,81 Miscellaneous payables - - - - Marketable securities issued 6,63 - - - Funds accepted by development and investment banks 2,30 2,60 45,84 Funds provided from other financial institutions(***) 3,60 5,97 22,64 (*) Ratios shown in the table are calculated by using annual interest rates. (**) The majority of the TL portfolio consists of CPI indexed securities. (***) Funds from other financial institutions also include subordinated loans. End of the Prior Period (31.12.2023) EURO USD JPY TL Assets (*) Cash (cash in vault, effectives, money in transit, cheques purchased) and balances with the Central Bank of the Republic of Türkiye - - - - Banks 4,00 5,60 - 44,16 Financial assets measured at fair value through profit or loss - - - - Money market placements - - - 43,48 Financial assets measured at fair value through other comprehensive income 4,55 7,58 - 49,52 Loans 7,19 8,74 - 17,58 Other financial assets measured at amortised cost (**) 4,62 7,68 - 50,76 Liabilities (*) Interbank deposits - - - - Other deposits - - - - Money market borrowings - - - 40,57 Miscellaneous payables - - - - Marketable securities issued (****) 7,50 - - 44,01 Funds accepted by development and investment banks 0,86 4,53 - 43,07 Funds provided from other financial institutions (***) 3,86 6,43 - 20,94 (*) Ratios shown in the table are calculated by using annual interest rates. (**) The majority of the TL portfolio consists of CPI indexed securities. (***) Funds from other financial institutions also include subordinated loans. (****)TL portfolio consists of issues of Kalkınma Yatırım Varlık Kiralama A.Ş. . 60 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) V. Explanations Related to Position Risk of Equity Securities: None. VI. Explanations Related to Liquidity Risk Management, Liquidity Coverage Ratio and Net Stable Funding Ratio (Continued): 1. Explanations on Consolidated Liquidity Risk Management The Parent Bank’s liquidity management is managed by Treasury Department in coordination with related departments and the strategies constituted by Asset Liability Committee as part of “Risk Management Strategies, Policies and Application Principles” that is approved by the Board of Directors. The liquidity risk management as per the implementation principles are stated as follows: Liquidity risk refers to the probability that the Parent Bank will incur the consequential loss that it cannot anticipate or face unforeseeable, all cash flow requirements without affecting the day-to-day operations or financial structure. Liquidity risk also represents the possibility of loss due to the Parent Bank’s inability of settling with market prices since the lack of depth and excessive fluctuations in the market. The main policy of Liquidity Risk Management in the Parent Bank is to provide quality asset structure in which any liabilities can be fulfilled. Since the Parent Bank is specialized, its liquidity need is more predictable as compared to commercial banks and ensures cash flows provided for its liabilities more regularly. The type, maturity structure and compliance of interest rates of assets and liabilities in the balance sheet, is assured within the framework of the Asset Liability Committee’s decisions. The Parent Bank keeps liquidity ratios within risk limits as set out in legal legislation and follows regularly. In order to manage liquidity risk, proforma cash flows are set on the basis of predictable data by evaluating the maturities of asset and liability structure. Proper placement of liquidity excess considering alternative gains and meeting liquidity needs with the most appropriate cost of funding is essential. Additionally, monthly proforma cash flows and balance sheet durations regarding the fulfilment level of medium- and long-term liabilities are traced in order to determine early factors that generate risk. Mainly for risk measurement and monitoring activities to determine the level of liquidity risk; The liquidity risk of the Parent Bank is calculated by using “Liquidity Analysis Forms” in accordance with the format determined by the BRSA and reported to the BRSA on a weekly and daily basis. Limits on liquidity risk are determined under; the legal limitations set out by the BRSA and the “Liquidity Emergency Plan Directive of the Bank”. The Parent Bank’s “Liquidity Emergency Plan Directive” came into force with the decision of the Board of Directors dated 21 December 2022 and numbered 2022-20- 11/287. Situations that require the implementation of the Liquidity Emergency Plan are followed by indicators derived from bank-specific (internal) and financial market developments. The Liquidity Emergency Plan includes actions to ensure that the Parent Bank fulfills its obligations at its current level and to maintain liquidity at the level required by the Bank or to achieve liquidity at acceptable costs and to provide the necessary liquidity with the objective of protecting the Parent Bank’s reputation. 61 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) VI. Explanations Related to Liquidity Risk Management, Liquidity Coverage Ratio and Net Stable Funding Ratio (Continued): 1. Consolidated Liquidity Risk Management (Continued): In the liquidity risk management of the Parent Bank, the limitations within the scope of the relevant regulations of the BRSA and the internal risk limits determined within the framework of the Parent Bank’s “Risk Management Strategies, Policies and Implementation Principles” and general market conditions are determinants. Therefore, units active in liquidity risk management, especially the Treasury Unit, act within these limitations. First limitation on legal requirements set by the BRSA is; as per the regulation on “Calculation of Liquidity Coverage Ratio”, minimum limits of 100% and 80% are assigned on consolidated and unconsolidated basis respectively for total and foreign currency limits. On the other hand investment and development banks are exempt from those limitations until BRSA has determined otherwise. The Bank’s internal reporting within the scope of liquidity risk management consists of daily, weekly and monthly reports. Daily balance sheets and duration calculations are followed in daily basis report. On weekly reports, liquidity limits are monitored. Weekly realized liquidity limits determined by Board of Directors is aggregated in monthly risk limits monitoring report. Those reports investigate legal risks and adaption of early warning limits. Also, to monitor liquidity risk in “TKB Riskiness Analysis According to Selected Indicators and Risk Groups” report prepared monthly includes; - Proforma Cash Flows Statement, - Proforma Currency Balance Sheet, - Duration of Balance Sheet Items, -in detail- Marketable Securities (by class of financial instruments), - Summary of liquidity forms sent to BRSA With proforma cash flows statement, amount of future liquid assets are shown in different scenarios for one-year period. Related report is presented to the Board of Directors; the Audit Committee and senior management on a monthly basis. By taking into consideration these reports, the Asset Liability Committee and Audit Committee evaluate the liquidity position of the Parent Bank, and results of liquidity measurement system are included in the decision-making process. Regarding the liquidity risk, as well as legal limits, internal limits have been determined in accordance with its own internal procedures, mission and risk appetite, as included in the Bank ’s Risk Appetite Structure, Risk Limits and Implementation Principles. These limits have been determined by the Board of Directors in excess of legal limits, including early warning limits, and are revised annually. 2. Consolidated liquidity coverage ratio The Bank’s liquidity coverage ratios are prepared monthly in accordance with the “Regulation on Calculation of the Liquidity Coverage Ratio of Banks” published in the Official Gazette dated 21 March 2014 and numbered 28948 and reported to the BRSA. Including the reporting period for the last 3 months levels of consolidated foreign currency and total liquidity coverage ratios are shown below by specified monthly: 62 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) VI. Explanations Related to Liquidity Risk Management, Liquidity Coverage Ratio and Net Stable Funding Ratio (Continued): 2. Consolidated liquidity coverage ratio (Continue) Period TP+YP YP 31 October 2024 330,15 148,84 30 November 2024 330,70 118,96 31 December 2024 390,76 165,72 Total Unweighted Total Weighted Value (Average) (*) Value (Average) (*) Current Period (31.12.2024) TL+FC FC TL+FC FC HIGH-QUALITY LIQUID ASSETS Total high-quality liquid assets (HQLA) - - 17.928.077 5.720.041 CASH OUTFLOWS Retail and small business customers deposits - - - - Stable deposits - - - - Less stable deposits - - - - Unsecured funding other than retail and small business customers deposits 4.113.643 2.682.189 2.610.803 1.365.444 Operational deposits - - - - Non-operational deposits - - - - Other unsecured funding 4.113.643 2.682.189 2.610.803 1.365.444 Secured funding - - Other cash outflows 12.239.546 7.454.747 12.239.546 7.454.747 Liquidity needs related to derivatives and market valuation changes on derivatives transactions 12.239.546 7.454.747 12.239.546 7.454.747 Debts related to structured financial products - - - - Payment commitments related to debts to financial markets and other off-balance sheet liabilities - - - - Commitments that are unconditionally revocable at any time and other contractual commitments 26.268.678 24.545.468 1.313.434 1.227.273 Other irrevocable or conditionally revocable commitments 4.835.479 4.683.443 4.528.480 4.376.444 TOTAL CASH OUTFLOWS 20.692.263 14.423.908 CASH INFLOWS Secured receivables - - - - Unsecured receivables 20.339.751 4.555.958 19.209.857 3.665.879 Other cash inflows 12.509.353 7.349.465 12.509.353 7.349.465 TOTAL CASH INFLOWS 32.849.104 11.905.423 31.719.210 11.015.344 Upper Limit Applied Amounts TOTAL HIGH-QUALITY LIQUID ASSETS 17.928.077 5.720.041 TOTAL NET CASH OUTFLOWS 5.173.066 3.973.087 LIQUIDITY COVERAGE RATIO (%) 346,57 143,97 (*) The average of last three months’ liquidity coverage ratios calculated by monthly simple averages. 63 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) VI. Explanations Related to Liquidity Risk Management, Liquidity Coverage Ratio and Net Stable Funding Ratio (Continued): 2. Consolidated liquidity coverage ratio (Continued): Period TP+YP YP 31 October 2023 200,18 106,04 30 November 2023 193,02 100,00 31 December 2023 198,42 100,00 Rate of “Percentage to be Rate of “Percentage to be Taken into Account” not Taken into Account” Implemented Total Implemented Total Value(*) Value(*) Prior Period (31.12.2023) TL+FC FC TL+FC FC HIGH-QUALITY LIQUID ASSETS Total high-quality liquid assets (HQLA) - - 9.622.453 2.094.847 CASH OUTFLOWS Retail and small business customers deposits - - - - Stable deposits - - - - Less stable deposits - - - - Unsecured funding other than retail and small business customers deposits 2.388.024 1.297.796 1.758.498 860.022 Operational deposits - - - - Non-operational deposits - - - - Other unsecured funding 2.388.024 1.297.796 1.758.498 860.022 Secured funding - - Other cash outflows 13.685.646 3.392.326 13.685.646 3.392.326 Liquidity needs related to derivatives and market valuation changes on derivatives transactions 13.685.646 3.392.326 13.685.646 3.392.326 Debts related to structured financial products - - - - Payment commitments related to debts to financial markets and other off-balance sheet liabilities - - - - Commitments that are unconditionally revocable at any time and other contractual commitments 8.492.908 6.517.397 424.645 325.870 Other irrevocable or conditionally revocable commitments 3.743.582 3.660.612 3.743.551 3.660.581 TOTAL CASH OUTFLOWS 19.612.340 8.238.799 CASH INFLOWS Secured receivables - - - - Unsecured receivables 22.224.909 2.229.563 21.286.142 1.477.142 Other cash inflows 13.613.657 11.229.229 13.613.657 11.229.229 TOTAL CASH INFLOWS 35.838.566 13.458.792 34.899.799 12.706.371 Üst Sınır Uygulanmış Değerler TOTAL HIGH-QUALITY LIQUID ASSETS 9.622.453 2.094.847 TOTAL NET CASH OUTFLOWS 4.903.085 2.059.700 LIQUIDITY COVERAGE RATIO (%) 196,25 101,71 (*) The average of last three months’ liquidity coverage ratios calculated by monthly simple averages. 64 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) VI. Explanations Related to Liquidity Risk Management, Liquidity Coverage Ratio and Net Stable Funding Ratio (Continued): 3. Explanations related to consolidated liquidity coverage ratio Significant factors that impact the result of consolidated liquidity coverage ratio and change of the items in time that are taken into account in calculation of this ratio The significant factors that impact liquidity coverage ratio are net cash outflows and high-quality assets stock. Items taken into consideration in the calculation of the ratio may be changed in time because of economic structure and decisions of the Bank’s fund management. The explanation about elements of the high-quality liquid assets High quality liquid assets mostly consist of domestic government bonds and eurobonds. Content of funds and their composition The main funding source of the Bank is loans attained from domestic and international financial institutions. The share of these resources in all funds is approximately 82,4%. 6,4% of the Parent Bank’s total funding consists of funds provided from Ministry of Treasury and Finance, borrowers and banks; 5,8% consists of subordinated debt instruments; 2,6% is provided from money markets and 2,8% consists of securities issued. Cash outflows generating from derivative transactions and information about which transactions are subject to collateral margin Derivative transactions of the Parent Bank are predominantly currency swap purchase-sale transactions. Income and expense figures related to derivative transactions made within the year are accounted in profit/loss from derivative financial transactions. There are no transactions that are likely to complete collateral. Counterparty and product-based funding sources and concentration limits on collateral The fund sources of the Parent Bank, whose field of activity is development and investment banking, are generally international development banks and financial institutions; there is no concentration limit on the other party and product basis. The operational and legal factors that hinder consolidated liquidity transfer which is needed by the bank itself, its foreign branch and its consolidated subsidiary, and respective liquidity risk. None. 4. Net stable funding ratio: With the “Regulation on Calculation of Net Stable Funding Ratio of Banks” published in the Official Gazette No. 32202 dated 26 May 2023 by the BRSA, the procedures and principles for banks to provide stable funding in order to prevent the deterioration of their liquidity levels due to the funding risk that they may be exposed to in the long term have been determined. According to the related regulation, the net stable funding ratio is calculated on consolidated and unconsolidated basis by dividing the available stable funding amount by the required stable funding amount. Available stable funding refers to the portion of banks’ liabilities and shareholders’ equity that is expected to be permanent, while required stable funding refers to the portion of banks’ on-balance sheet assets and off-balance sheet liabilities that are expected to be re-funded. These amounts are included in the ratio calculation after applying the calculation rates determined in the regulation. 65 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) VI. Explanations Related to Liquidity Risk Management, Liquidity Coverage Ratio and Net Stable Funding Ratio (Continued): 4. Net stable funding ratio (Continued): The quarterly simple arithmetic average of the quarterly net stable funding ratio calculated on a monthly and quarterly basis and reported to the BRSA cannot be less than 100%. However, development and investment banks are exempted from meeting these minimum ratios until otherwise determined by the BRSA. As of 31 December 2024, the average of the Parent Bank's net stable funding rates for the last three months is 141,93% (31 December 2023: 162,75%). Amount Not Subject to Recognition Due to Remaining Maturity Total Amount Short-term (6 Long-term Subject to Short-term (less months to less (1 year and Consideration Current Period (31.12.2024) Demand(*) than 6 months) than 1 year) longer) Ratio A. CURRENT STABLE FUND 1 Equity Components 20.678.008 - - 3.560.311 24.238.319 2 Principal Capital and Contributed Capital 20.678.008 - - 3.560.311 24.238.319 3 Other Equity Components - - - - - 4 Individual and Retail Customer Deposits/Participation Funds - - - - - 5 Stable Deposits/Participation Funds - - - - - 6 Low Stable Deposits/Participation Funds - - - - - 7 Other Liabilities to Others - 11.203.556 455.002 113.849.837 117.124.756 8 Operational Deposits/Participation Funds - - - - 9 Other Liabilities 11.203.556 455.002 113.849.837 117.124.756 10 Liabilities Equivalent to Interrelated Assets 11 Other Liabilities 11.327.747 407.652 - - - 12 Derivative Liabilities 311.297 - - 13 Other Equity Items and Liabilities Not Included Above 11.327.747 96.355 - - - 14 STABLE FUNDING REQUIREMENT 141.363.075 B. REQUIRED STABLE FUNDING 15 High-Quality Liquid Assets 972.148 16 Operational Deposits/Participation Funds Deposited with Credit Institutions or Financial Institutions 17 Live Receivables - 31.546.024 1.630.903 109.908.851 100.746.741 18 Receivables from Credit Institutions or Financial Institutions with Collateral Consisting of First-Quality Liquid Assets - - 19 Receivables from Credit Institutions or Financial Institutions with Collateral Not Consisting of First-Quality Liquid Assets - 31.546.024 1.630.903 11.906.215 17.453.570 20 Receivables from Corporate Customers, Entities, Individuals, and Retail Customers, Central Governments, Central Banks, and Public Institutions Other than Credit Institutions or Financial Institutions - - 91.820.897 78.047.762 21 Receivables subject to 35% or lower risk weight - - - - - 22 Receivables Secured by Residential Real Estate Mortgages - - - 45.350 29.478 23 Receivables subject to 35% or lower risk weight - - - 45.350 29.478 24 Tradable Stocks and Bonds with High-Quality Liquid Asset Characteristics - - - 6.136.389 5.215.931 25 Assets Equivalent to Interrelated Liabilities 26 Other Assets 2.031.809 96.208 - - 2.062.939 27 Physical Delivery Commodities Including Gold - - 28 Initial Margin of Derivative Contracts or Guarantee Fund Provided to Central Counterparties - - - - 29 Derivative Assets - - - - 30 Amount of Derivative Liabilities before Deduction of Variation Margin - - - 31.130 31 Other Assets Not Included Above 2.031.809 96.208 2.031.809 32 Off-Balance Sheet Liabilities 9.414.992 470.750 33 REQUIRED STABLE FUNDING 104.252.577 34 NET STABLE FUNDING RATIO (%) 135,60 (*) The column labeled "Demand" (Current/Non-maturity) reports items that do not have a specific maturity date. These include but are not limited to equity items with no specified maturity, demand deposits, short positions, positions with unspecified maturities, equities that are not high-quality liquid assets, and physically settled commodities. 66 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) VI. Explanations Related to Liquidity Risk Management, Liquidity Coverage Ratio and Net Stable Funding Ratio (Continued): 4. Net stable funding ratio (Continued): Amount Not Subject to Recognition Due to Remaining Maturity Total Amount Short-term Short-term (6 Long-term Subject to (less than 6 months to less (1 year and Consideration Prior Period (31.12.2023) Demand(*) months) than 1 year) longer) Ratio A. CURRENT STABLE FUND 1 Equity Components 12.272.401 - 4.358.880 3.130.988 19.762.269 2 Principal Capital and Contributed Capital 12.272.401 - 4.358.880 3.130.988 19.762.269 3 Other Equity Components - - - - - 4 Individual and Retail Customer Deposits/Participation Funds - - - - - 5 Stable Deposits/Participation Funds - - - - - 6 Low Stable Deposits/Participation Funds - - - - - 7 Other Liabilities to Others 2.909.732 23.363.891 7.099.519 94.501.261 104.299.570 8 Operational Deposits/Participation Funds - - - - - 9 Other Liabilities 2.909.732 23.363.891 7.099.519 94.501.261 104.299.570 10 Liabilities Equivalent to Interrelated Assets 11 Other Liabilities 9.074.089 1.031.984 - - - 12 Derivative Liabilities 217.463 - - 13 Other Equity Items and Liabilities Not Included Above 9.074.089 814.521 - - - 14 STABLE FUNDING REQUIREMENT 124.061.839 B. REQUIRED STABLE FUNDING 15 High-Quality Liquid Assets 1.110.126 16 Operational Deposits/Participation Funds Deposited with Credit Institutions or Financial Institutions 17 Live Receivables - 25.421.279 2.351.696 80.780.232 74.868.805 18 Receivables from Credit Institutions or Financial Institutions with Collateral Consisting of First-Quality Liquid Assets - - - - - 19 Receivables from Credit Institutions or Financial Institutions with Collateral Not Consisting of First-Quality Liquid Assets - 24.978.340 1.939.685 7.138.710 11.855.304 20 Receivables from Corporate Customers, Entities, Individuals, and Retail Customers, Central Governments, Central Banks, and Public Institutions Other than Credit Institutions or Financial Institutions - 442.939 412.011 72.330.190 61.908.136 21 Receivables subject to 35% or lower risk weight - - - - - 22 Receivables Secured by Residential Real Estate Mortgages - - - 46.336 30.118 23 Receivables subject to 35% or lower risk weight - - - 46.336 30.118 24 Tradable Stocks and Bonds with High-Quality Liquid Asset Characteristics - - - 1.264.996 1.075.247 25 Assets Equivalent to Interrelated Liabilities 26 Other Assets 1.827.286 711.149 - - 1.899.760 27 Physical Delivery Commodities Including Gold - - 28 Initial Margin of Derivative Contracts or Guarantee Fund Provided to Central Counterparties - - - - 29 Derivative Assets - - - 50.728 30 Amount of Derivative Liabilities before Deduction of Variation Margin - - - 21.746 31 Other Assets Not Included Above 1.827.286 711.149 - - 1.827.286 32 Off-Balance Sheet Liabilities 11.796.859 - - 589.843 33 REQUIRED STABLE FUNDING 78.468.534 34 NET STABLE FUNDING RATIO (%) 158,10 (*) The column labeled "Demand" (Current/Non-maturity) reports items that do not have a specific maturity date. These include but are not limited to equity items with no specified maturity, demand deposits, short positions, positions with unspecified maturities, equities that are not high-quality liquid assets, and physically settled commodities. 67 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) VI. Explanations Related to Liquidity Risk Management, Liquidity Coverage Ratio and Net Stable Funding Ratio (Continued): 5. Maturity analysis of assets and liabilities according to remaining maturities: Up to 1 1-3 3-12 5 Years and Undistribute Demand 1-5 Years Total Month Months Months Over d(1) Current Period (31.12.2024) Assets Cash (cash in vault, effectives, money in transit, cheques purchased) and balances with the Central Bank of the Republic of Türkiye 1.836 - - - - - - 1.836 Banks 79.628 12.637.012 - - - - - 12.716.640 Financial assets measured at fair value through profit or loss 696.997 - - - - - - 696.997 Money market placements - 9.918.269 - - - - - 9.918.269 Financial assets measured at fair value through other comprehensive income 8.813 1.768.399 3.937.974 8.371.533 11.287.819 142.965 - 25.517.503 Loans - 1.474.107 3.296.815 14.848.802 52.853.592 20.480.064 156.399 93.109.779 Financial assets measured at amortised cost - 689.039 447.067 1.896.968 1.773.580 5.570.850 - 10.377.504 Other assets - 144.142 - - - - 1.111.799 1.255.941 Total Assets(2) 787.274 26.630.968 7.681.856 25.117.303 65.914.991 26.193.879 1.268.198 153.594.469 Liabilities Bank deposits - - - - - - - - Other deposits - - - - - - - - Funds provided from other financial institutions - 3.238.952 2.806.749 9.239.977 37.058.411 59.330.270 - 111.674.359 Money market borrowings - 3.417.116 - - - - - 3.417.116 Marketable securities issued - - - 65.084 1.835.420 1.835.420 - 3.735.924 Miscellaneous payables 171.549 - - - - - - 171.549 Other liabilities(3) 2.862.777 2.218.814 745.498 - - 7.577.111 21.191.321 34.595.521 Total Liabilities 3.034.326 8.874.882 3.552.247 9.305.061 38.893.831 68.742.801 21.191.321 153.594.469 Liquidity Gap (2.247.052) 17.756.086 4.129.609 15.812.242 27.021.160 (42.548.922) (19.923.123) - Net Off-Balance Position - 128.539 (34.644) - - - - 93.895 Derivative Financial Assets - 8.706.736 705.796 - - - - 9.412.532 Derivative Financial Liabilities - 8.578.197 740.440 - - - - 9.318.637 Non-Cash Loans 149.197 - - 140.033 - 4.785.940 - 5.075.170 Prior Period (31.12.2023) Total Assets 693.256 24.476.924 6.767.083 29.059.025 51.120.142 22.625.586 957.670 135.699.686 Total Liabilities 2.811.411 7.589.658 3.227.892 23.642.087 34.027.588 52.596.133 11.804.917 135.699.686 Liquidity Gap (2.118.155) 16.887.266 3.539.191 5.416.938 17.092.554 (29.970.547) (10.847.247) - Net Off-Balance Position - (33.007) (37.771) - - - - (70.778) Derivative Financial Assets - 10.206.920 809.944 - - - - 11.016.864 Derivative Financial Liabilities - 10.239.927 847.715 - - - - 11.087.642 Non-Cash Loans 84.924 - - 85.965 - 4.583.451 - 4.754.340 (1) Assets such as fixed assets, associates, subsidiaries, inventory, prepaid expenses, net non-performing receivables and other asset accounts that would not be converted to cash in a short time period and needed to be used in the banking activities, deferred tax asset; liabilities with no maturities, provisions and equity are shown in the undistributed column. (2) The expected credit losses for financial assets and other assets are reflected in the related items. (3) Subordinated loans are shown in the “Other Liabilities” line. 68 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) VI. Explanations Related to Liquidity Risk Management, Liquidity Coverage Ratio and Net Stable Funding Ratio (Continued): Remaining maturity distribution of contractual financial liabilities: The following table shows the maturity distribution of the Bank’s non-derivative financial liabilities prepared in accordance with the provisions of TFRS 7. The distribution has been prepared based on the earliest dates on which the Bank’s liabilities are due to be paid without discounting. The interest payable on these liabilities is included in the table. The recorded values of the related liabilities in the balance sheet do not include these amounts. Current Period Up To 1 3-12 5 Years (31.12.2024) Book Value Total Month 1-3 Months Months 1-5 Years and above Liabilities Funds from Other Financial Institutions 111.674.359 162.759.028 3.068.013 3.536.323 15.182.174 60.572.640 80.399.878 Debts to Money Markets 3.417.116 3.458.749 1.879.448 1.579.301 - - - Issued Securities 3.735.924 4.694.347 - 92.728 93.237 2.440.633 2.067.749 Subordinated Debt Instruments 7.577.111 22.032.856 - - - - 22.032.856 104.500.48 Total 126.404.510 192.944.980 4.947.461 5.208.352 15.275.411 63.013.273 3 Prior Period Up To 1 3-12 5 Years (31.12.2023) Book Value Total Month 1-3 Months Months 1-5 Years and above Liabilities Funds from Other Financial Institutions 101.435.241 142.776.682 4.417.162 2.994.934 22.170.089 52.505.376 60.689.121 Debts to Money Markets 2.874.989 2.874.989 2.874.989 - - - - Issued Securities 4.176.377 5.183.620 - 525.194 494.266 1.820.096 2.344.064 Subordinated Debt Instruments 11.578.723 25.261.806 - - 6.141.140 - 19.120.666 Total 120.065.330 176.097.097 7.292.151 3.520.128 28.805.495 54.325.472 82.153.851 Contractual maturity analysis of the Parent Bank’s derivative instruments is as follows: Current Period Up to 1 5 Years and (31.12.2024) Total Month 1-3 Months 3-12 Months 1-5 Years above Swap Transactions 9.508.656 5.181.266 2.741.315 1.586.075 - - Prior Period Up to 1 5 Years and (31.12.2023) Total Month 1-3 Months 3-12 Months 1-5 Years above Swap Transactions 11.098.952 10.099.891 999.061 - - - 69 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) VI. Explanations Related to Liquidity Risk Management, Liquidity Coverage Ratio and Net Stable Funding Ratio (Continued): Remaining maturity distribution of contractual financial liabilities (Continued) The following table shows the distribution of the Bank’s non-cash loans according to their remaining maturities. Current Period Up to 1 1-3 3-12 5 Years (31.12.2024) Demand Month Months Months 1-5 Years and above Total Letters of Credit - - - 133.709 - - 133.709 Endorsements - - - - - - - Letters of Guarantee 149.197 - - 6.324 - 4.152.929 4.308.450 Acceptance loans - - - - - - - Other - - - - - 633.011 633.011 Total 149.197 - - 140.033 - 4.785.940 5.075.170 Prior Period Up to 1 1-3 3-12 5 Years (31.12.2023) Demand Month Months Months 1-5 Years and above Total Letters of Credit - - - - - - - Endorsements - - - - - - - Letters of Guarantee 84.924 - - 85.965 - 3.974.191 4.145.080 Acceptance loans - - - - - - - Other - - - - - 609.260 609.260 Total 84.924 - - 85.965 - 4.583.451 4.754.340 70 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) VII. Explanation Related to Consolidated Leverage Ratio In the current period, the rate of increase in Tier 1 capital was higher than the rate of increase in total risk amount. As of 31 December 2024, the Group’s leverage ratio calculated from the average of three months is 14,73% (31 December 2023: 11,72%). The reason why the leverage ratio of the current period is higher than the leverage ratio of the previous period is that Tier 1 capital has increased at a higher rate than the amount of the total risk amount related to on-balance sheet assets. Summary comparison table of total asset amount and total risk amount in consolidated financial statements prepared in accordance with TAS: Current Period(1),(2) Prior Period(1),(3) (31.12.2024) (31.12.2023) The total amount of assets included in the consolidated financial statements issued in accordance with 1 TAS 211.805.516 179.826.057 2 The difference between total assets prepared in accordance with Turkish Accounting Standards and total assets in consolidated financial statements prepared in accordance with the communiqué ‘Preparation of Consolidated Financial Statements’ 60.839.361 48.719.279 3 The difference between the amounts of derivative financial instruments and credit derivatives in consolidated financial statements prepared in accordance with the communiqué ‘Preparation of Consolidated Financial Statements’ and risk amounts of such instruments 689.053 812.874 4 The difference between the amounts of securities or commodity financing transactions in consolidated financial statements prepared in accordance with the communiqué ‘Preparation of Consolidated Financial Statements’ and risk amounts (2.722.103) (2.303.955) 5 The difference between the amounts of off-balance items in consolidated financial statements prepared in accordance with the communiqué ‘Preparation of Consolidated Financial Statements’ and risk amounts of such items (21.229.692) (7.413.630) 6 Other differences between the amounts in consolidated financial statements prepared in accordance with the communiqué ‘Preparation of Consolidated Financial Statements’ and risk amounts of such items 144.162.555 135.074.217 7 Total risk amount 163.359.197 140.996.766 (1) The amounts in the table show the averages of the last nine months of the relevant period. (2) The current period amount of the consolidated financial statements prepared in accordance with the 6th paragraph of the 5th a rticle of the Communiqué on the Preparation of the Consolidated Financial Statements of Banks has been prepared by using the Independent financial statements of non-financial corporations dated 30 June 2024. (3) The previous period amount of the consolidated financial statements prepared in accordance with the 6th paragraph of the 5th article of the Communiqué on the Preparation of the Consolidated Financial Statements of the Banks has been prepared by using the audited financial statements of the non-financial corporations dated 30 June 2023. Current Period Prior Period On-balance sheet assets (31.12.2024) (31.12.2023) Balance sheet assets (Excluding derivative financial instruments and credit derivatives, including collaterals) 152.639.700 132.072.403 (Assets deducted in determining Tier 1 capital) - - Total risk amount of on-balance sheet assets 152.639.700 132.072.403 Derivative financial instruments and loan derivatives Replacement cost of derivative financial instruments and loan derivatives - - Potential loan risk amount of derivative financial instruments and loan derivatives 689.053 812.874 Total risk amount of derivative financial instruments and loan derivatives 689.053 812.874 Financing transactions secured by marketable security or commodity Risk amount of financing transactions secured by marketable security or commodity (excluding on- balance sheet) 1.887.654 1.779.837 Risk amount from brokerage activities - - Total risk amount of financing transactions secured by marketable security or commodity 1.887.654 1.779.837 Off-balance sheet items Gross notional amount of off-balance sheet transactions 29.372.482 13.745.282 (Adjustments amount due to multiplication with credit conversion rates) (21.229.692) (7.413.630) Total risk amount of off-balance sheet transactions 8.142.790 6.331.652 Capital and total risks Tier 1 capital 24.062.722 16.519.940 Total risks 163.359.197 140.996.766 Leverage ratio Leverage ratio 14,73 11,72 (*) Calculated by taking the average of the last three months financial statements’ data. 71 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) VIII. Explanations on the Presentation of Consolidated Financial Assets and Liabilities at Fair Values: When fair value of financial assets and liabilities are determined, discounted values are taken into consideration according to remaining maturities. Transactions traded on the stock exchange are valued by using the daily weighted average prices of the last working day on the balance sheet date based on the stock market value. Book Value (*) Fair Value Current Period Prior Period Current Period Prior Period (31.12.2024) (31.12.2023) (31.12.2024) (31.12.2023) Financial Assets 154.069.687 136.431.799 154.660.658 136.974.963 Money markets placements 9.921.861 17.046.025 9.921.861 17.046.025 Banks 12.718.116 4.939.659 12.718.116 4.939.659 Financial assets measured at fair value through profit or loss 696.997 591.455 696.997 591.455 Financial assets measured at fair value through other comprehensive income 25.517.503 15.220.615 25.517.503 15.220.615 Financial assets measured at amortised cost 10.402.375 14.475.337 10.246.272 14.374.184 Loans 94.812.835 84.158.708 95.559.909 84.803.025 Financial Liabilities 123.158.943 117.564.067 122.100.997 117.597.381 Interbank deposits - - - - Other deposits - - - - Funds provided from other financial institutions 111.674.359 101.435.241 112.243.474 102.260.744 Subordinated debt instruments 7.577.111 11.578.723 5.811.249 10.802.460 Securities issued 3.735.924 4.176.377 3.874.725 4.160.451 Sundry creditors 171.549 373.726 171.549 373.726 (*) The book values of financial assets and liabilities in the table are calculated by adding accrual amounts at the end of the period. Methods and estimations used for the fair value determination of financial instruments which are not presented with their market values in the financial statements: i- For the fair value determination of loans, interest rates as of balance sheet date are considered. ii- For the fair value determination of banks, interest rates as of balance sheet date are considered. iii- In order to calculate the fair value of other financial assets measured at amortized cost, the stock market value as of the balance sheet date has been used. iv- For the fair value determination of the funds provided from other financial institutions, subordinated debt instruments and securities issued, alternative resource interest rates are considered. 72 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) VIII. Explanations regarding the presentation of consolidated financial assets and liabilities at fair value (Continued) Information on fair value measurements recognized in the financial statements: TFRS 7 “Financial Instruments: Disclosures” Standard requires the items, which are recognized in the balance sheet at their fair values to be shown in the notes by being classified. According to this standard, the related financial instruments are classified into three levels in such a way that they will express the significance of the data used in fair value measurements. At the first level, there are financial instruments, whose fair values are determined according to quoted prices in active markets for identical assets or liabilities, at the second level, there are financial instruments, whose fair values are determined by directly or indirectly observable market data, and at the third level, there are financial instruments, whose fair values are determined by the data, which are not based on observable market data. Investor valuation and price reports are used for determination of fair values of level 3 assets The financial assets, which are recognized in the balance sheet at their values, are shown below as classified according to the aforementioned principles. Current Period (31.12.2024) Level 1 Level 2 Level 3 Financial Assets at Fair Value Through Profit or Loss - - 696.997 Debt securities - - - Share certificates - - 696.997 Other - - - Financial Assets at Fair Value Through Other Comprehensive Income 24.749.229 759.461 - Debt securities 24.749.229 759.461 - Share certificates(1) - - - Other - - - Derivative Financial Assets - 144.142 - Investment in Associates and Subsidiaries(1) - - - Derivative Financial Liabilities - 20.889 - 1) Non-public subsidiaries, affiliates and unlisted shares are monitored at cost of acquisition. Cost may be an appropriate estimate of fair value. This situation is measured at cost because there is not enough recent information regarding the measurement of fair value or because fair value can be measured by more than one method and among these methods, cost best reflects the fair value estimate Prior Period (31.12.2023) Level 1 Level 2 Level 3 Financial Assets at Fair Value Through Profit or Loss - - 591.455 Debt securities - - - Share certificates - - 591.455 Other - - - Financial Assets at Fair Value Through Other Comprehensive Income 14.968.360 233.893 4.186 Debt securities 14.968.360 233.893 - Share certificates(1) - - 4.186 Other - - - Derivative Financial Assets - 65.716 - Investment in Associates and Subsidiaries(1) - - - Derivative Financial Liabilities - 18.299 - 1)Non-public subsidiaries, affiliates and unlisted shares are monitored at cost of acquisition. Cost may be an appropriate estimate of fair value. This situation is measured at cost because there is not enough recent information regarding the measurement of fair value or because fair value can be measured by more than one method and among these methods, cost best reflects the fair value estimate 73 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) VIII. Explanations Related to the Presentation of Financial Assets and Liabilities at Fair Values (Continued): The table below shows the movement table of Level 3 financial assets. Current Period Prior Period Level 3 Movement Table (31.12.2024) (31.12.2023) Balance at the Beginning of the Period 595.641 293.443 Purchases During the Period 19.525 108.231 Disposals Through Sale/Redemptions (4.024) (8.372) Valuation Effect 90.040 202.339 Transfers (4.186) - Balance at the End of the Period 696.997 595.641 IX. Explanations on the Transactions Made on Behalf of Others and Items Held in Trust The Bank provides security buying, selling and custody services on behalf and account of others. The Bank also acts as an intermediary in the execution of tourism and infrastructure investments on behalf of the Republic of Türkiye Ministry of Culture and Tourism, and no new resources have been transferred in this context recently. The Bank does not carry out any transactions based on faith. X. Explanations Related to Consolidated Risk Management: 1. General informatşon on risk management and risk-weighted amounts: The Paraet Bank’s risk management approach: It should be emphasized firstly that the Bank is actively using committees and risk budgeting in decision- making mechanisms and risk management processes while assessing risk management performance in addition to the functional and financial performance, which has operational mechanisms based on a wide range of activities. Within the framework of the Bank's vision, mission, strategic objectives and targets set by the Board of Directors and risk management policies and strategies; the Asset and Liability Committee and the Credit Evaluation Committee constitute two main committees that play a critical role in the execution of the Bank’s activities; which the Asset and Liability Committee ensuring that the assets and liabilities are managed effectively and efficiently by taking into consideration the current and possible economic developments and the factors such as interest, maturity and currency, and establishing coordination and communication between the Senior Management and the Bank's units, and the Credit Evaluation Committee with the function of determining the principles of lending, evaluating the credit- participation risk and the situation of the investment, evaluating the reports prepared on the loan appraisal and in summary taking care of all the lending activities. Within the framework of the short-term strategies determined by the Asset and Liability Committee in line with the vision and strategic objectives of the Bank’s Strategic Plan, each of the units in the Bank comply with these targets and the risk budgeting application based on the consolidation of these budgets are applied to contribute to the basic activities of the Bank. Risk monitoring processes constitute the main determinant of risk management policies in decision making processes in the Bank. The organizational structure of the risk monitoring processes is composed of, the “Internal Control and Compliance” and “Risk Management” Directorates which the duties and authorities established within the Bank with the decision of the Board of Directors pursuant to the Banking Law and the BRSA legislation, the Audit Committee and the Internal Inspection Department. The units within the internal systems of the Bank and the Audit Committee undertake their activities in accordance with the “Regulation on Internal Systems of Banks and Internal Capital Adequacy Assessment Process” dated 11/07/2014 and numbered 29057 of the BRSA. 74 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued) 1. General information on risk management and risk weighted amounts: The Paraet Bank’s risk management approach (Continued) The general principle of the risk policies followed by the Bank where committees and the implementation of risk budgeting are actively used in decision-making mechanisms and risk management processes; which was approved by Board of Directors dated 11.01.2016, 2016-01-15/015 stated in the Bank’s “Risk Management Strategies, Policies and Implementation Principles”, “To specialize in the activities in accordance with the mission, vision and structure determined by the Establishment Law, to take risks that can be identified, controlled and / or managed, and to make efforts to avoid any risks other than the risks inevitable and arising as part of the nature of the activities”. While the Bank is specializing in its activities and shaping the asset composition in line with this general principle in accordance with its vision and structure, in the risk management policy it is subject to the principle of “taking risks that can be controlled and / or managed, not taking any risks other than the risks that are unavoidable and to apply this principle as much as possible. In this context, it is the basic principle to ensure that the risks to be taken are defined and manageable. In addition, to the extent that risk measurement and reporting techniques allow, measurement of the present and future potential impacts of the risks taken is made and written limits for the quantifiable risks arising from the operations of the Bank are determined according to the BRSA regulations. Therefore, the risk appetite of the Bank is determined and monitored by the risk limits prepared in accordance with the provisions of Article 39 titled “Risk Appetite Structure” of Internal Systems and ICAAP Regulations of Banks No. 29057 issued by the BRSA and published in the Official Gazette on 11 July 2014. “Risk Limits and Implementation Principles”, which are revised by the Risk Management Department annually in accordance with the Bank's risk policies and accepted by the Board of Directors, are the main policy that determines the Bank’s risk appetite structure. According to the “Risk Limits and Implementation Guidelines” which is the most important indicator of the risk appetite of the Bank, limits, early warning limits and actions to be taken in case of exceeding limit are determined by basic risk groups. In determining limits, the legal limits shape the general framework. However, in addition to the principle of prudence in risk management, specific limits specific to the Bank are also set for each risk type. The early warning limits are intended to prevent limit overs, and the limits are set one level below (or above). Each risk group covered by the Bank’s risk limits is monitored by reports made to the Senior Management and the Audit Committee on a daily, weekly, monthly basis by the Risk Management Department and is first informed to the relevant unit in the framework of the actions to be taken in determining the elimination of exceeded limits. It is clear that both the decision-making mechanisms and the risk management processes are the general principle of risk policies and the Bank has a “risk avoider” risk appetite within the framework of risk limits and implementation principles. The limits stated in the text of “Risk Appetite Structure, Risk Limits and Implementation Principles” approved by the Board of Directors within the framework of the 37th article of “Regulation on Internal Systems of Banks” issued by the BRSA for quantifiable risks arising from the activities of the Bank are determined. The Risk Management Department monitors compliance with these limits and regularly reports to the Board of Directors, the Audit Committee and the Senior Management. 75 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued) 1. General information on risk management and risk weighted amounts: The Paraet Bank’s risk management approach (Continued) Stress test scenario analyzes carried out by the Bank within the scope of risk management activities include various techniques to measure the potential resilience of the Bank portfolio against unexpected risks. Capital Planning Buffer prepared in accordance with the provisions of the “Stress Test Program” specified in article 43 of “Regulation on Internal Systems of Banks and Internal Capital Adequacy Assessment Process” and Guidelines for Stress Tests to be Used by Banks in Capital and Liquidity Planning and specified in Article 59 of the Regulation. The results of the implementation of the scenarios determined by the BRSA used in the calculation are sent to the BRSA within the scope of the ISEDES (Internal Capital Adequacy Assessment Process) Report prepared by Risk Management Department annually. In the ISEDES Report, the Bank’s capital adequacy level is evaluated by applying the BRSA and our Bank scenarios on the Bank’s 3-year Strategic Plan predictions. The stress test scenario analyzes, which are updated quarterly for the Bank, are also structured in a structure parallel to ISEDES practices. Stress testing is carried out by applying two negative scenarios of the relevant year, determined by the BRSA, to the financial statements and capital adequacy ratio components of the period to be tested. In the stress test study, shocks are given on the basis of two basic parameters (interest and exchange rate), and by each parameter and each scenario the effects of these shocks on; i- Balance sheet and statement of profit or loss ii- Legal equity iii- Risk Weighted Assets (RWA) iv- Capital Adequacy Ratio (CAR) are evaluated. The first parameter used in the scenario analysis is the exchange rate and the other is the interest rates. Exchange rate and interest shocks are designed as base, negative and extremely negative scenarios sent by BRSA. On the Bank’s securities portfolio, portfolio sensitivity is firstly calculated against changes in interest rates, and two separate scenarios are set forth to compensate for the potential loss arising from adverse interest rate changes. The Bank’s “Proforma Cash Flows Statement” analysis, which is prepared based on the possible cash inflows and outflows in the next one-year period, including seven different scenarios, ranging from 45 percent to 95 percent of “loan collection rates” and implicitly including currency and interest forecasts, it is the most detailed scenario analysis that the Bank has prepared. In this analysis, the effects of different collection ratios on the liquidity risk of the Bank are evaluated. 76 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued) 1. General information on risk management and risk weighted amounts: The Paraet Bank’s risk management approach (Continued) Footnotes and related explanations prepared in accordance with the “Communiqué on Disclosures About Risk Management to Be Announced to Public by Banks” published in the Official Gazette No: 29511 on 23 October 2015 and entered into force as of 31 March 2016 are given in this section. In accordance with the relevant communiqué, the following tables, which should be given quarterly, were not presented as of 31 December 2024, as the Bank’s standard approach was used in the calculation of capital adequacy: - RWA flow statement under Internal Ratings Based Approach (IRB) - RWA flow statements of CCR exposures under Internal Model Method (IMM) - RWA flow statements of market risk exposures under Internal Model Approach Overview of risk weighted amounts: Minimum Capital Risk Weighted Amount Requirement Current Period Prior Period Current Period (31.12.2024) (31.12.2023) (31.12.2024) 1 Credit risk (excluding counterparty credit risk) (CCR) 106.681.360 99.876.756 8.534.509 2 Of which standardized approach (SA) 106.681.360 99.876.756 8.534.509 3 Of which internal rating-based (IRB) approach - 4 Counterparty credit risk 363.655 612.536 29.092 5 Of which standardized approach for counterparty credit risk (SA-CCR) 363.655 612.536 29.092 6 Of which internal model method (IMM) - 7 Equity position in banking book under basic risk weighting or internal rating-based - 8 Equity investments in funds – look-through approach - 9 Equity investments in funds – mandate-based approach - 10 Equity investments in funds – 1250% risk weighting approach - 11 Settlement risk - 12 Securitization exposures in banking book - 13 Of which IRB ratings-based approach (RBA) - 14 Of which IRB supervisory formula approach (SFA) - 15 Standard Of which SA/simplified supervisory formula approach (SSFA) - 16 Market Risk 20.484.321 14.226.300 1.638.746 17 Of which standardized approach (SA) 20.484.321 14.226.300 1.638.746 18 Of which internal model approaches (IMM) - 19 Operational Risk 7.260.018 3.360.326 580.801 20 Of which basic indicator approach 7.260.018 3.360.326 580.801 21 Of which standardized approach - 22 Of which advanced measurement approach - 23 Amounts below the thresholds for deduction from capital (subject to 250% risk weight) - 24 Floor adjustments - 25 Total (1+4+7+8+9+10+11+12+16+19+23+24) 134.789.354 118.075.918 10.783.148 77 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X.Explanations Related to Consolidated Risk Management (Continued) 2. Credit risk explanations: General qualitative information on credit risk: The Bank calculates its legal credit risk as per the framework of the “Regulation on the Measurement and Evaluation of Banks’ Capital Adequacy” and Basel II criteria. The management of credit risk is essential in such a way as to ensure that the standard ratio of legal capital adequacy is above the minimum limit of existing regulations. Within the scope of “Basel II application” under the measure of credit risk, the standard method prescribed by the BRSA is used and this measurement method based on weighting to the classes and guarantees of the loans is embodied in the KR520 form which is reported monthly to the BRSA. There are basically 3 main headings of the form: - Risk Classes, - Credit Risk Reduction Techniques and Credit Risk Substitution Effects, - Distribution by Risk Weights. In order to determine the credit risk, the Bank’s Risk Weighted Assets are classified by “Separation On The Basis of Risk Classes”. After the asset is classified according to the risk classes, collaterals received on loans are assessed under Basel II “Credit Risk Mitigation Techniques and Credit Risk Substitution Effects”. The credit risk is measured monthly within the standard method framework, by using the algorithm in the “Basel II Credit Rating Classification”. Respecting the credit risk management measurement, monitoring, stress testing and scenario analysis studies in line with the volume, quality and complexity of loans and reporting results are provided to the Audit Committee and the Board of Directors. Beside the standard method for determining the level of credit risk that the Bank may encounter, by moving from the Bank’s loan portfolio structure for risk measurement and monitoring activities; - Credit Risks by Sectors - Credit Risks by Region - Non-performing Loans Analysis - Concentration Analysis of Credits - Risks Weights of Loan Collaterals - Sectoral Risks According to Risk Weights of Loans - Distribution of Loans by Maturity and Source - Distribution of Performing Credits are analyzed and reported. In the Bank’s credit risk management policy, diversification of credit portfolio is essential. Although the Bank is not subject to the credit restrictions imposed on banks accepting deposits pursuant to Article 77 of the Banking Law No. 5411, the Bank has determined its credit limits with the “Credit Policy” published with the approval of the Board of Directors. Credit risk limits are determined in the text of “Risk Appetite Structure, Risk Limits and Implementation Principles” approved by the Board of Directors, and the limits are monitored daily, weekly and monthly by the Risk Management Unit and reported to the Top Management. 78 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 2. Credit risk explanations (Continued): General qualitative information on credit risk (Continued) All units, including the departments within the Internal Systems, fulfill their duties, authorities, and responsibilities within the scope of credit risk management in accordance with the framework of the Banking Law, Internal Systems Regulation, and Bank’s Duties, Authorities, Responsibilities, and Organization Principles. The senior management is responsible for the implementation of the credit risk strategy approved by the board of directors and the development of policies and procedures for the recognition, measurement, monitoring, and control of credit risk, and these policies and procedures include credit risks related to all banking activities in the Bank’s portfolio. The explanations prepared by the “Communiqué on Disclosures About Risk Management to be Announced to Public by Banks” published in the Official Gazette No. 29511 on 23 October 2015, and entered into force as of 31 March 2016, are given below. The Bank reveals risks of the effects of income/expense, capital loss, liquidity adequacy, etc. that may arise regarding macroeconomic indicators and bank-specific situations with periodic reports and stress test studies. Daily, weekly, monthly and annual reports are produced with the risk measurement models and methods used by the Bank regarding the risk situation of the Bank, and they are regularly reported to the Board of Directors, Audit Committee, and Senior Management. The possible effects on the Bank's equity and capital adequacy ratios and liquidity adequacy level are closely monitored. It is aimed to disseminate the risk appetite framework and culture created by the Bank through the training given to the personnel, risk measurements and reporting, and risk reporting to the Board of Directors, Senior Management, and Committees. As a part of the risk appetite structure, it is aimed to determine the risk appetite level of the Bank through regulations such as the determination of risk limits, limit exceedance exceptions, and early warning levels. Limits are updated periodically, taking into account the developments in the Bank's strategy and risk appetite. Early warning levels indicating that the determined limits are approached have also been determined, and in case the limit levels are approached or exceeded, the relevant units take the necessary actions and arrangements. Risk limits are determined together with the relevant senior managers, including the Manager of the Risk Management Unit and the General Manager of the Bank, and submitted to the Board of Directors for approval following the approval of the Audit Committee. While determining the limits, the macroeconomic environment and market trends, as well as the targets and policies of the Bank are taken into account, and risk concentration limits are determined based on sector, geographical region, country and product. Since the Bank uses a standard approach in capital adequacy calculations, explanations within the scope of the internal rating-based approach are not included. 79 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 2. Credit risk explanations (Continued): Credit quality of assets: Non-Default Provisions/Amortisations Default (a) (b) and Impairment Current Period The gross amount in financial tables (c) (31.12.2024) that valued according to TAS Net Value (a+b-c) 1 Loans 732.750 94.080.085 (1.703.056) 93.109.779 2 Debt securities - 35.920.579 (83.284) 35.837.295 Off-balance 3 receivables 2 5.075.168 (20.728) 5.054.442 4 Total 732.752 135.075.832 (1.807.068) 134.001.516 Non-Default Default (a) (b) Provisions/Amortisations and Impairment Prior Period The gross amount in financial tables (c) (31.12.2023) that valued according to TAS Net Value (a+b-c) 1 Loans 848.082 83.310.626 (1.421.094) 82.737.614 2 Debt securities - 29.679.219 (8.659) 29.670.560 Off-balance 3 receivables 2 4.754.338 (53.480) 4.700.860 4 Total 848.084 117.744.183 (1.483.233) 117.109.034 Changes in stocks of default loans and debt securities: Current Period (31.12.2024) 1 Defaulted loans and debt securities at the end of prior reporting period 848.082 2 Defaulted loans and debt securities from last reporting period 27.174 3 Returned to non-defaulted status - 4 Amounts written of - 5 Other changes (142.506) 6 Defaulted loans and debt securities at the end of reporting period (1+2-3-4+-5) 732.750 Prior Period (31.12.2023) 1 Defaulted loans and debt securities at the end of prior reporting period 894.374 2 Defaulted loans and debt securities from last reporting period 95.249 3 Returned to non-defaulted status - 4 Amounts written of - 5 Other changes (141.541) 6 Defaulted loans and debt securities at the end of reporting period (1+2-3-4+-5) 848.082 80 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 2. Credit risk explanations (Continued): Additional disclosures about the credit quality of assets(Continued): The Bank evaluates its financial assets in 3 Stages within the scope of TFRS 9. In this context, for defaulted loans (3.Stage) and loans that have not yet defaulted, but which have significantly increased credit risk from the date of the loan's issuance (2.Stage), the Bank calculates the expected lifetime credit loss. The Bank's other financial assets covered by TFRS 9 (1.Stage); the Bank reflects the probability of default within 12 months after the reporting date as the expected loss provision. In case of payment failure of borrowers to the Bank due to temporary liquidity shortage loans and other receivables, including overdue interest, are restructured within the scope of the Provision Regulation by opening additional loans when necessary in order to provide liquidity strength to the borrower and to ensure the collection of the Bank’s receivables. Temporary liquidity shortage is considered as a manageable cash deficit caused by a loan borrower who has the solvency to pay his obligations on time and in full becoming irregular due to fluctuations in fund inflows and outflows, sales revenues or operating income arising from normal activities due to an unexpected and temporary reason. Restructured loans will continue to be monitored in the groups in which they are classified and monitored until that date. During this period, provisions for these receivables continue to be allocated within the scope of TFRS 9. 81 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 2. Credit risk explanations (Continued): Breakdown of non-performing loans and respective provisions by geographic regions Current Period (31.12.2024) Stage 3 Expected Credit Non-performing loans Loss Domestic 732.750 576.351 European Countries - - OECD Countries - - Total 732.750 576.351 Prior Period (31.12.2023) Stage 3 Expected Credit Non-performing loans Loss Domestic 848.082 528.780 European Countries - - OECD Countries - - Total 848.082 528.780 Information in terms of major sectors and type of counterparties Non- Performing Expected Loss Current Period (31.12.2024) Loans Loans Provision Total (Net) Agriculture 887.280 - 1.337 885.943 Farming and animal breeding - - - - Forestry 518.716 - 1.305 517.411 Fishery 368.564 - 32 368.532 Industry 76.090.400 664.162 1.617.844 75.136.718 Mining and quarry - - - - Manufacturing 32.417.864 20.006 128.968 32.308.902 Electricity, gas and water 43.672.536 644.156 1.488.876 42.827.816 Construction - - - - Service 17.102.405 67.454 82.741 17.087.118 Wholesale and retail trade - - - - Hotel and restaurant services 851.466 63.343 45.439 869.370 Transportation and communication 2.343.708 8 5.434 2.338.282 Financial institutions 13.756.376 26.746 13.729.630 Real estate and leasing services - - - - Self-employment services - - - - Educational services 17.514 - 664 16.850 Health and social services 133.341 4.103 4.458 132.986 Other - 1.134 1.134 - Total 94.080.085 732.750 1.703.056 93.109.779 82 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 2. Credit risk explanations (Continued): Information in terms of major sectors and type of counterparties (Continued): Non- Performing Expected Loss Prior Period (31.12.2023) Loans Loans Provision Total (Net) Agriculture 426.371 - 498 425.873 Farming and animal breeding - - - - Forestry - - - - Fishery 426.371 - 498 425.873 Industry 72.145.595 751.728 1.309.764 71.587.559 Mining and quarry 392.602 - 5.755 386.847 Manufacturing 32.510.780 6.403 180.230 32.336.953 Electricity, gas and water 39.242.213 745.325 1.123.779 38.863.759 Construction 1.010.628 - 13.243 997.385 Service 9.728.032 95.220 96.455 9.726.797 Wholesale and retail trade - - - - Hotel and restaurant services 1.171.405 91.756 47.947 1.215.214 Transportation and communication - - - - Financial institutions 8.214.342 - 44.391 8.169.951 Real estate and leasing services - - - - Self-employment services - - - - Educational services 84.986 - 422 84.564 Health and social services 257.299 3.464 3.695 257.068 Other - 1.134 1.134 - Total 83.310.626 848.082 1.421.094 82.737.614 83 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 2. Credit risk explanations (Continued): Maturity analysis for non-performing loans Up to 3-12 1-3 3-5 5 Years and Current Period (31.12.2024) 3 Months Months Years Years above Corporate and Commercial Loans - 14.889 40.201 644.156 32.370 Other - - - - 1.134 Total - 14.889 40.201 644.156 33.504 Up to 3-12 1-3 3-5 5 Years and Prior Period (31.12.2023) 3 Months Months Years Years above Corporate and Commercial Loans - 68.030 709.012 36.314 33.592 Other - - - - 1.134 Total - 68.030 709.012 36.314 34.726 Breakdown of restructured receivables by whether provision has been allocated or not Current Period Prior Period (31.12.2024) (31.12.2023) Expected Loss Expected Loan Balance Provisions Loan Balance Loss Provisions Restructured from Performing Loans 5.391.875 537.866 1.185.182 79.615 Restructured from Non-Performing Loans 20.918 586 745.325 472.090 Total 5.412.793 538.452 1.930.507 551.705 84 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 2. Credit risk explanations (Continued): Qualitative requirements to be disclosed to the public regarding credit risk mitigation techniques: In the calculation of the amounts subject to credit risk, the Parent Bank evaluates the loans in terms of risk weight, taking into consideration the risk classes, grading notes and risk reduction elements within the context of “Communiqué on Credit Risk Mitigation Techniques”. The Parent Bank does not make on-balance sheet and off-balance sheet netting within the scope of credit risk mitigation. Applications related to valuation and management of collateral are carried out in line with the “Communiqué on Credit Risk Mitigation Techniques”. Main guarantees taken by the Bank in the context of credit risk mitigation techniques are financial guarantees (cash) and guarantees (Turkish Treasury and banks). Monetary guarantees are evaluated with the most recent values as of the reporting date in the credit risk reduction process. In the event that a bank loan customer receives guarantees obtained from other institutions, the credit risk worthiness of the guaranteeing institution in the credit risk reduction process is taken into consideration. Overview of credit risk mitigation techniques: Collateralized Collateralized Exposures Collateralized amount of amount of Current Period unsecured: amount of Exposures exposures Exposures exposures (31.12.2024) carrying Exposures exposures secured by secured by secured by secured by amount as per secured by secured by financial financial credit credit TAS collateral collateral guarantees guarantees derivatives derivatives 1 Loans 6.306.135 88.506.699 %100 - - - - 2 Debt Instruments - 35.920.579 %100 - - - - 3 Total 6.306.135 124.427.278 %100 - - - - 4 Overdue - 732.750 %100 - - - - Collateralized Collateralized Exposures Collateralized amount of amount of Prior Period unsecured: amount of Exposures exposures Exposures exposures (31.12.2023) carrying Exposures exposures secured by secured by secured by secured by amount as per secured by secured by financial financial credit credit TAS collateral collateral guarantees guarantees derivatives derivatives 1 Loans 4.307.948 79.850.760 %100 - - - - 2 Debt Instruments - 29.679.219 %100 - - - - 3 Total 4.307.948 109.529.979 %100 - - - - 4 Overdue - 848.082 %100 - - - - Qualitative information on ratings used by banks while calculating credit risk with standard approach : The risk weigths of the risk categories as per the Article 6 of the “Regulation on Measurement and Assessment of Capital Adequacy Ratios of Bank” are determined pursuant to the regulations. Any external risk ratings which are determined by any international rating agency are not used. 85 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 2. Credit risk explanations (Continued): Standard Approach - Credit risk exposure and credit risk mitigation effects The Parent Bank calculates the credit risk with a standard approach and do not use a rating score. Exposures before CCF Exposures post-CCF Risk Weighted Amount and and and Intensity of Risk Current Period (31.12. 2024) CRM CRM Weighted Amount Intensity of On-balance Off-balance On-balance Off-balance Risk risk sheet sheet sheet sheet weighted weighted Risk Class amount amount amount amount amount amount Exposures to central governments and central banks 14.046.693 - 15.633.834 - 3.674.463 23,50% Exposures to regional or local governments - - - - - - Exposures to administrative bodies and non-commercial entities - - - - - - Exposures to multilateral development banks - - - - - - Exposures to international organizations - - - - - - Exposures to banks and brokerage houses 25.675.522 9.454.025 30.757.980 386.372 13.454.691 43,20% Exposures to corporates 87.087.470 14.864.478 80.484.511 5.008.307 85.492.818 100,00% Retail exposures - - - - - - Exposures secured by residential property 45.350 - 45.350 - 15.873 35,00% Exposures secured by commercial property 5.438.781 - 5.407.781 - 2.953.856 54,62% Past-due receivables 156.399 - 156.399 - 88.508 56,59% Exposures in high-risk categories by the Agency Board - - - - - - Collateralized securities - - - - - - Short term exposures to banks, brokerage houses and corporates - - - - - - Exposures in the form of collective investment undertakings 224.298 61 224.298 61 224.359 100,00% Other exposures 1.150.246 - 1.060.929 - 1.060.703 99,98% Equity share investments - - - - - - Total 133.824.759 24.318.564 133.771.082 5.394.740 106.965.271 76,86% 86 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 2. Credit risk explanations (Continued): Standard Approach - Credit risk exposure and credit risk mitigation effects (Continued) Risk Weighted Exposures before CCF Exposures post-CCF Amount and Intensity and and of Risk Weighted Prior Period (31.12.2023) CRM CRM Amount On- Off- On- Off- Intensity of balance balance balance balance Risk risk sheet sheet sheet sheet weighted weighted Risk Class amount amount amount amount amount amount Exposures to central governments and central banks 15.426.669 - 17.152.893 - 8.127.217 47,4% Exposures to regional or local governments - - - - - - Exposures to administrative bodies and non-commercial entities - - - - - - Exposures to multilateral development banks - - - - - - Exposures to international organizations - - - - - - Exposures to banks and brokerage houses 30.466.555 262.919 37.195.272 131.465 19.528.511 52,3% Exposures to corporates 72.318.476 12.657.072 65.332.441 4.754.331 70.086.772 100,0% Retail exposures - - - - - - Exposures secured by residential property 51.762 - 51.762 - 18.117 35,0% Exposures secured by commercial property 2.726.045 - 2.720.997 - 1.579.441 58,0% Past-due receivables 319.302 - 319.302 - 184.772 57,9% Exposures in high-risk categories by the Agency Board - - - - - - Collateralized securities - - - - - - Short term exposures to banks, brokerage houses and corporates - - - - - - Exposures in the form of collective investment undertakings 228.437 54 228.437 54 228.491 100,0% Other exposures 651.322 - 606.148 - 605.126 99,8% Equity share investments - - - - - - Total 122.188.568 12.920.045 123.607.252 4.885.850 100.358.447 78,1% 87 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 2. Credit risk explanations (Continued): Standard Approach - Exposures by asset classes and risk weights: The bank calculates credit risk with a standard approach and does not use a rating score. Current Period (31.12.2024) Total risk 100% 150% 250% amount 10% 20% 25% 35% 50% 75% 0% Other (after CCF and CRM) Risk Class/Risk Weight Exposures to central governments 1 and central banks 11.959.371 - - - - - - 3.674.463 - - - 15.633.834 Exposures to regional or 2 local governments - - - - - - - - - - - - Exposures to administrative bodies and 3 non-commercial entities - - - - - - - - - - - - Exposures to multilateral 4 development banks - - - - - - - - - - - - Exposures to international 5 organizations - - - - - - - - - - - - Exposures to banks and 6 brokerage houses - - 14.423.829 - - 11.706.160 - 4.710.773 - - 303.590 31.144.352 7 Exposures to corporates - - - - - - - 85.492.818 - - - 85.492.818 8 Retail exposures - - - - - - - - - - - - Exposures secured by 9 residential property - - - - 45.350 - - - - - - 45.350 Exposures secured by 10 commercial property - - - - - 4.907.851 - 499.930 - - - 5.407.781 11 Past-due receivables - - - - - 135.782 - 20.617 - - - 156.399 Exposures in high-risk 12 categories by the Agency Board - - - - - - - - - - - - 13 Collateralized securities - - - - - - - - - - - - Short term exposures to banks, brokerage houses 14 and corporates - - - - - - - - - - - - Exposures in the form of collective investment 15 undertakings - - - - - - - 224.359 - - 224.359 16 Equity share investments - - - - - - - - - - - - 17 Other exposures 226 - - - - - - 1.060.703 - - - 1.060.929 18 Total 11.959.597 - 14.423.829 - 45.350 16.749.793 - 95.683.663 - 303.590 139.165.822 88 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 2. Credit risk explanations (Continued): Standard Approach - Exposures by asset classes and risk weights (Continued): Prior Period (31.12.2023) Total risk 100% 150% 250% amount 10% 20% 25% 35% 50% 75% 0% Other (after CCF and CRM) Risk Class/Risk Weight Exposures to central governments 1 and central banks 9.025.676 - - - - - - 8.127.217 - - - 17.152.893 Exposures to regional or 2 local governments - - - - - - - - - - - - Exposures to administrative bodies 3 and non-commercial entities - - - - - - - - - - - - Exposures to multilateral 4 development banks - - - - - - - - - - - - Exposures to international 5 organizations - - - - - - - - - - - - Exposures to banks and 6 brokerage houses 68.372 - 15.219.014 - - 10.629.701 - 11.164.964 - - 244.686 37.326.737 7 Exposures to corporates - - - - - - - 70.086.772 - - - 70.086.772 8 Retail exposures - - - - - - - - - - - - Exposures secured by 9 residential property - - - - 51.762 - - - - - - 51.762 Exposures secured by 10 commercial property - - - - - 2.283.112 - 437.885 - - - 2.720.997 11 Past-due receivables - - - - - 269.060 - 50.242 - - - 319.302 Exposures in high-risk 12 categories by the Agency Board - - - - - - - - - - - - 13 Collateralized securities - - - - - - - - - - - - Short term exposures to banks, brokerage houses 14 and corporates - - - - - - - - - - - - Exposures in the form of collective investment 15 undertakings - - - - - - - 228.491 - - 228.491 16 Equity share investments - - - - - - - - - - - - 17 Other exposures 1.021 - - - - - - 605.127 - - - 606.148 18 Total 9.095.069 - 15.219.014 - 51.762 13.181.873 - 90.700.698 - 244.686 128.493.102 89 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 3. Counterparty credit risk disclosures: Qualitative explanation of the evaluation of counterparty credit risk according to measurement methods: A counterparty credit risk is the risk that a counterparty who is involved in a transaction that is liable to both parties defaults before the final payment in the cash flow of that transaction. The Bank takes necessary measures to limit counterparty credit risks arising from bilateral transactions, such as off-balance sheet over the counter derivative transactions, by taking into account risk capacities. Transactions made by the Treasury Department including counter-party risks such as over the counter forward, swaps and options are reported daily to the Senior Management and Risk Management Department. All transactions made with counterparty are considered within the limits of the counterparty. Exceeded limits are reported daily to the responsible managers and are recorded with all measures taken to overcome these limitations. Alpha Potential Used for Credit Computing EAD Risk Current Period (31.12.2024) Replacement Risk Regulatory Post- Weighted Cost Amount EEPE EAD CRM Amounts Standardized Approach - CCR (for 1 derivatives) - 380.349 1,4 532.489 361.081 Internal Model Method (for derivative transactions and security financing 2 transactions) - - - - Simple financial collateral method used for CRM (for securities financing 3 transactions) - - Comprehensive financial collateral method used for CRM (for securities 4 financing transactions) - - Value-at-Risk (VaR) for repo transactions, securities or commodity lending or borrowing transactions, long settlement transactions and credit securities financing 5 transactions 151.097 2.574 6 Total 363.655 90 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 3. Counterparty credit risk disclosures (Continued): Evaluation of counterparty credit risk according to measurement methods Alpha Used Potential for Credit Computing EAD Risk Prior Period (31.12.2023) Replacement Risk Regulatory Post- Weighted Cost Amount EEPE EAD CRM Amounts Standardized Approach - CCR (for 1 derivatives) 50.728 527.402 1,4 809.381 610.166 Internal Model Method (for derivative transactions and security financing 2 transactions) - - - - Simple financial collateral method used for CRM (for securities financing 3 transactions) - - Comprehensive financial collateral method used for CRM (for securities financing 4 transactions) - - Value-at-Risk (VaR) for repo transactions, securities or commodity lending or borrowing transactions, long settlement transactions and 5 credit securities financing transactions 118.499 2.370 6 Total 612.536 Capital Requirement for CVA: Derivative transactions of the Bank consists of forward foreign exchange buying-selling and swap money buying-selling transactions. There are no interest-based swap transactions, option contracts and other derivative transactions. The Bank has no derivative products to be created to differentiate them from the main contract. Risk Amount (After using credit risk Risk-weighted Current Period (31.12.2024) mitigation techniques) amounts Total amount of portfolios subject to CVA capital requirement according to the advanced method - - 1 (i) Value-at-risk component (including 3*multiplier) - - 2 (ii) Stress value-at-risk (including 3*multiplier) - - 3 Total amount of portfolios subject to CVA capital requirement according to the standard method 379.996 79.335 4 Total amount subject to CVA capital requirement 379.996 79.335 91 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 3. Counterparty credit risk disclosures (Continued): Capital Requirement for CVA (Continued): Risk Amount (After using credit risk Risk-weighted Prior Period (31.12.2023) mitigation techniques) amounts Total amount of portfolios subject to CVA capital requirement according to the advanced method - - 1 (i) Value-at-risk component (including 3*multiplier) - - 2 (ii) Stress value-at-risk (including 3*multiplier) - - 3 Total amount of portfolios subject to CVA capital requirement according to the standard method 809.381 130.670 4 Total amount subject to CVA capital requirement 809.381 130.670 Standard approach - counterparty credit risk based on risk classes and risk weights: Current Period (31.12.2024) Total Risk Weights / credit Risk Class 0% 10% 20% 50% 75% 100% 150% Other risk (*) Exposures to central governments and central banks 22.413 - - - -- - - - Exposures to regional or local governments - - - - - - - - - Exposures to administrative bodies and non-commercial entities - - - - - - - - - Exposures to multilateral development banks - - - - - - - - - Exposures to international organizations - - - - - - - - - Exposures to banks and brokerage houses - - - - - 357.583 - 303.590 363.655 Exposures to corporates - - - - - - - - Retail exposures - - - - - - - - - Other assets - - - - - - - - - Total 22.413 - - - - 357.583 - 303.590 363.655 (*) Total credit risk: The amount to be taken into account in the calculation of capital adequacy after credit risk reduction is applied. 92 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 3. Counterparty credit risk disclosures (Continued): Standard approach - counterparty credit risk based on risk classes and risk weights (Continued): Prior Period (31.12.2023) Total Risk Weights / credit Risk Class 0% 10% 20% 50% 75% 100% 150% Other risk (*) Exposures to central governments and central banks 7.180 - - - - 1.987 - - 321.987 Exposures to regional or local governments - - - - - - - - - Exposures to administrative bodies and non-commercial entities - - - - - - - - - Exposures to multilateral development banks - - - - - - - - - Exposures to international organizations - - - - - - - - - Exposures to banks and brokerage houses 68.372 - - - - 285.655 - 244.686 290.549 Exposures to corporates - - - - - - - - Retail exposures - - - - - - - - - Other assets - - - - - - - - - Total 75.552 - - - - 607.642 - 244.686 612.536 (*) Total credit risk: The amount to be taken into account in the calculation of capital adequacy after credit risk reduction is applied. 93 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 3. Counterparty credit risk disclosures (Continued): Collaterals used for counterparty credit risk (Continued) A counterparty credit risk is the risk that a counterparty who is involved in a transaction that is liable to both parties defaults before the final payment in the cash flow of that transaction. The Bank takes necessary measures to limit counterparty credit risks arising from bilateral transactions, such as off-balance sheet derivative transactions, by taking into account risk capacities. Collaterals for other Collaterals for derivative transactions transactions Current Period (31.12.2024) Collaterals received Collaterals given Collaterals Collaterals Segregated Unsegregated Segregated Unsegregated received given Cash-domestic currency - - - - - - Cash-foreign currency - - - - - - Domestic sovereign debt - - 656.486 - 41.331 3.413.630 Other sovereign debt - - - - - - Government agency debt - - - - - - Corporate bonds - - - - - - Equity securities - - - - - - Other collateral - - - - - - Total - - 656.486 - 41.331 3.413.630 Collaterals for other Collaterals for derivative transactions transactions Prior Period (31.12.2023) Collaterals received Collaterals given Collaterals Collaterals Segregated Unsegregated Segregated Unsegregated received given Cash-domestic currency - - - - - - Cash-foreign currency - - - - - - Domestic sovereign debt - - 276.707 - 247.294 2.737.755 Other sovereign debt - - - - - - Government agency debt - - - - - - Corporate bonds - - - - - - Equity securities - - - - - - Other collateral - - - - - - Total - - 276.707 - 247.294 2.737.755 94 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 3. Counterparty credit risk disclosures (Continued): Credit derivatives None. Explanations on counterparty credit risk: Risk Amount RWA After Current Period (31.12.2024) CRM Total risks arising from qualified transactions where one of the parties is CCP 650.834 3.909 Regarding the risks arising from the transactions in the CCP (excluding the initial margin and the amount placed in the guarantee fund) 174.906 3.498 (i) OTC derivatives - - (ii) Other derivative transactions 174.906 3.498 (iii) Securities financing transactions - - (iv) Netting groups to which cross product netting is applied - - Non-free initial margin 469.430 - Free initial deposit - - The amount put into the guarantee fund 6.498 411 The amount promised to be put into the guarantee fund - - Total risks arising from non-qualified transactions where one of the parties is CCP - - Regarding the risks arising from the transactions in the CCP (excluding the initial margin and the amount placed in the guarantee fund) - - (i) OTC derivatives - - (ii) Other derivative transactions - - (iii) Securities financing transactions - - (iv) Netting groups to which cross product netting is applied - - Non-free initial margin - - Free initial deposit - - The amount put into the guarantee fund - - The amount promised to be put into the guarantee fund - - Securitization disclosures None. 95 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 3. Counterparty credit risk disclosures (Continued): Explanations on counterparty credit risk (Continued): Risk Amount RWA After Prior Period (31.12.2023) CRM Total risks arising from qualified transactions where one of the parties is CCP 304.383 2.698 Regarding the risks arising from the transactions in the CCP (excluding the initial margin and the amount placed in the guarantee fund) 126.187 2.524 (i) OTC derivatives - - (ii) Other derivative transactions 126.187 2.524 (iii) Securities financing transactions - - (iv) Netting groups to which cross product netting is applied - - Non-free initial margin 169.512 - Free initial deposit - - The amount put into the guarantee fund 8.684 174 The amount promised to be put into the guarantee fund - - Total risks arising from non-qualified transactions where one of the parties is CCP - - Regarding the risks arising from the transactions in the CCP (excluding the initial margin and the amount placed in the guarantee fund) - - (i) OTC derivatives - - (ii) Other derivative transactions - - (iii) Securities financing transactions - - (iv) Netting groups to which cross product netting is applied - - Non-free initial margin - - Free initial deposit - - The amount put into the guarantee fund - - The amount promised to be put into the guarantee fund - - 96 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 4. Explanations on market risk: Qualitative information to be publicly disclosed on market risk: The Parent Bank is exposed to market risk depending on the fluctuations that may occur in the financial market as a result of its activities, in exchange rates, interest rates and stock prices. The Parent Bank calculates and legally reports its market risk by using the standard method within the framework of the provisions of the “Regulation Regarding the Measurement and Evaluation of Banks’ Capital Adequacy” published in the Official Gazette No. 29511 dated 23 October 2015. In addition to the monthly standardized methodology, the market risk is calculated on a daily basis using the Value At Risk (“VaR”) approach. The VaR calculated by using the internal model to predict the potential loss in financial market conditions, the stress tests and scenario analysis results, including the price changes occurring in the crises that occurred in previous years or the probable effects of different interest and exchange rate shocks on existing portfolios are reported to Audit Committee and top management. In accordance with the “Regulation on the Internal Systems of Banks and the Internal Capital Adequacy Assessment Process” published on the Official Gazette dated 11 July 2014 and numbered 29057, the limits of these risks are determined by taking into account the main risks borne by the Bank and such risk limits are determined within the framework of changing market conditions and Bank strategies “Risk Appetite Structure, Risk Limits and Implementation Principles” which are frequently revised and approved by the Board of Directors. The reports prepared within the framework of compliance with the risk limits are regularly presented to the Board of Directors, the Audit Committee and senior management. 97 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 4. Explanations on market risk (Continued): PR1-Market risk amounts based on standard approach: Current Period Prior Period (31.12.2024) (31.12.2023) RWA RWA Direct (cash) Products 1 Interest rate risk (general and specific) 20.372.690 14.150.941 2 Equity risk (general and specific) - - 3 Foreign exchange risk 111.631 75.359 4 Commodity risk - - Options 5 Simplified approach - - 6 Delta-plus method - - 7 Scenario approach - - 8 Securitization - - 9 Total 20.484.321 14.226.300 5. Linkages between the financial statements and risk amounts: Explanations on differences between the amounts prepared as per TAS and the risk amounts: “Credit Risks” are calculated over the securities classified as “Financial assets at fair value through profit or loss” and “Financial assets at fair value through other comprehensive income”. Repurchase and reverse repo transactions of the Bank are subject to “Counterparty Credit Risks” and the Capital Obligation against Counterparty Credit Risk is calculated and reported under the “Credit Risk”. In addition, “Market Risk” is calculated over the securities used in the “Reverse Repo” transactions. The amount in the “Off-balance amounts” row of the “Main sources of differences between risk amounts and amounts valued in accordance with TAS in the financial statements” table is reported as the “Amount Subject to Credit Risk” by multiplying it with the “Credit Conversion Ratios”. 98 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) CONSOLIDATED INFORMATION ON FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 5. Linkages between the financial statements and risk amounts (Continued): Differences and matching between accounting consolidation and legal consolidation: Carrying values in financial Items in accordance with TAS Carrying values in statements prepared as per The Not subject to financial statements TAS within legal counterparty Securitization Subject to capital Current Period (31.12.2024) prepared as per TAS(*) consolidation Subject to credit risk credit risk positions market risk requirements or subject to deduction from Assets capital Cash and Balances with the Central Bank 3.374 1.836 1.836 - - - - Financial assets held for trading - - - - - Financial assets at fair value through profit or loss 649.424 696.997 696.997 - - - - Banks 14.531.233 12.716.639 12.716.639 - - 40.053 - Money market receivables 6.641.492 9.918.269 9.878.216 - Financial Assets at Fair Value Through Other Comprehensive Income 21.481.157 25.517.503 3.944.830 - - 21.572.673 - Derivative Financial Assets 13.907 144.142 144.142 - - - - Loans and Receivables 90.271.736 93.109.778 93.109.778 - - - - Factoring receivables - - - - - - Financial Assets Measured at Amortised Cost 10.628.258 10.377.505 10.377.505 - - - - Investments in associates 10.586 10.586 10.586 - - - - Subsidiaries - - - Lease receivables - - - - - - - Tangible assets (net) 80.168 74.745 74.552 - - - 193 Intangible assets (net) 41.143 52.182 - - - - 52.182 Investment properties (net) - - - - - - - Tax asset 384.117 479.364 479.364 - - - - Other assets 352.942 494.922 494.922 - - - - Total Assets 145.589.537 153.594.468 131.929.368 - - 21.612.726 52.375 (*) The financial position table dated 30 June 2024, prepared in accordance with the sixth paragraph of Article 5 of the Communiqué on the Preparation of Consolidated Financial Statements of Banks, was used. 99 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) INFORMATION ON CONSOLIDATED FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 5. Linkages between the financial statements and risk amounts (Continued): Differences and matching between accounting consolidation and legal consolidation (Continued): Carrying values Items in accordance with TAS in financial statements Not subject to capital Carrying values in financial prepared as per requirements or statements prepared as per TAS within legal Subject to credit The counterparty Securitization Subject to market subject to deduction Current Period (31.12.2023) TAS(*) consolidation risk credit risk positions risk from capital Liabilities Deposit - - - - - - - Derivative financial liabilities held for trading 21.718 20.889 - 20.889 - - - Funds borrowed 99.773.702 108.284.851 - - - - - Money markets balances 4.582.972 3.417.116 - 3.417.116 - - - Issued securities 4.775.709 3.735.924 - - - - - Funds 5.303.587 8.402.633 - - - - - Miscellaneous Payables - 174.586 - - - - - Other external funding’s payable 683.435 532.021 - - - - - Factoring Payables - - - - - - - Debts from leasing transactions 28.658 22.348 - - - - - Derivative financial liabilities for hedging purposes - - - - - - - Provisions 543.609 605.012 - - - - - Tax liability 774.558 816.578 - - - - - Liabilities for assets held for sale and discontinued operations - - - - - - - Subordinated debts 11.986.960 7.577.111 - - - - - Shareholders’ equity 16.614.629 20.005.400 - - - - - Total liabilities and equity 145.089.537 153.594.469 - 3.438.005 - - - (*) The financial position table dated 30 June 2024, prepared in accordance with the sixth paragraph of Article 5 of the Communiqué on the Preparation of Consolidated Financial Statements of Banks, was used. 100 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) INFORMATION ON CONSOLIDATED FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 5. Linkages between the financial statements and risk amounts (Continued): Differences and matching between accounting consolidation and legal consolidation (Continued): Carrying values in Items in accordance with TAS Carrying values in financial statements Not subject to financial statements prepared as per TAS capital requirements prepared as per TAS (*) within legal Subject to credit The counterparty Securitization Subject to market or subject to Prior Period (31.12.2023) consolidation risk credit risk positions risk deduction from Assets capital Cash and Balances with the Central Bank 1.873 2.560 2.560 - - - - Financial assets held for trading - - - - - - - Financial assets at fair value through profit or loss 256.752 591.455 591.455 - - - - Banks 11.655.094 4.935.249 4.935.249 - - - - Money market receivables 7.876.167 17.034.644 16.795.102 239.542 Financial Assets at Fair Value Through Other Comprehensive Income 8.981.676 15.220.615 1.322.568 - - 13.898.047 - Derivative Financial Assets 1.264.983 65.715 65.715 - - - - Loans and Receivables 81.510.661 82.737.614 82.737.614 - - - - Factoring receivables - - - - - - Financial Assets Measured at Amortised Cost 10.449.189 14.473.466 14.473.466 - - - - Investments in associates 10.586 10.586 10.586 - - - - Subsidiaries - - - Lease receivables 65 - - - - - - Tangible assets (net) 48.122 43.010 43.010 - - - - Intangible assets (net) 22.072 32.323 - - - - 32.323 Investment properties (net) - - - - - - - Tax asset 24.288 324.243 324.243 - - - - Other assets 195.820 228.206 228.206 - - - - Total Assets 122.297.348 135.699.686 121.529.774 239.542 - 13.898.047 32.323 (*) The financial position table dated 30 June 2023, prepared in accordance with the sixth paragraph of Article 5 of the Communiq ué on the Preparation of Consolidated Financial Statements of Banks, was used. 101 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) INFORMATION ON CONSOLIDATED FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 5. Linkages between the financial statements and risk amounts (Continued): Differences and matching between accounting consolidation and legal consolidation (Continued): Carrying values Items in accordance with TAS in financial Carrying values in Not subject to capital statements financial statements requirements or subject prepared as per prepared as per TAS (*) to deduction from TAS within legal Subject to credit The counterparty Securitization Subject to market capital Prior Period (31.12.2023) consolidation risk credit risk positions risk Liabilities Deposit - - - - - - - Derivative financial liabilities held for trading 311.569 18.299 - 18.299 - - - Funds borrowed 91.105.474 97.947.040 - - - - - Money markets balances 2.626.272 2.874.989 - 2.874.989 - - - Issued securities 3.241.298 4.176.377 - - - - - Funds 5.688.852 6.397.933 - - - - - Miscellaneous Payables - 373.365 - - - - - Other external funding’s payable 858.691 448.306 - - - - - Factoring Payables - - - - - - - Debts from leasing transactions 22.004 21.326 - - - - - Derivative financial liabilities for hedging purposes - - - - - - - Provisions 237.201 433.171 - - - - - Tax liability 195.024 547.485 - - - - - Liabilities for assets held for sale and discontinued operations - - - - - - - Subordinated debts 9.384.429 11.578.723 - - - - - Shareholders’ equity 8.626.534 10.882.672 - - - - - Total liabilities and equity 122.297.348 135.699.686 - 2.893.288 - - - (*) The financial position table dated 30 June 2023, prepared in accordance with the sixth paragraph of Article 5 of the Communiq ué on the Preparation of Consolidated Financial Statements of Banks, was used. 102 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) INFORMATION ON CONSOLIDATED FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 5. Linkages between the financial statements and risk amounts (Continued): Main sources of differences between the risk amounts and carrying values in financial statements prepared as per TAS: Subject to Subject to Subject to Securitization counterparty market Current Period (31.12.2024) Total credit risk positions risk risk Carrying values of assets in accordance 1 with TAS within legal consolidation 153.594.469 131.929.369 - - 21.612.726 2 Carrying values of liabilities in accordance with TAS within legal consolidation 153.594.469 - - 3.417.116 - 3 Total net amount under legal consolidation - 131.929.369 - (3.417.116) 21.612.726 4 Off-balance sheet items 43.242.296 5.394.740 - 18.723.932 - 5 Valuation differences - - - - - 6 Differences arising from netting of differences (other than line 2) - - - - - 7 Differences arising from consideration of provisions - - - - - 8 Differences arising from the applications of the BRSA - - - - Risk amounts 196.836.765 137.324.109 - 18.723.932 21.612.726 Subject to Subject to Subject to Securitization counterparty market Prior Period (31.12.2023) Total credit risk positions risk risk Carrying values of assets in 1 accordance with TAS within legal consolidation 135.699.686 121.529.774 - 239.542 13.898.047 Carrying values of liabilities in 2 accordance with TAS within legal consolidation 135.699.686 - - 2.874.989 - 3 Total net amount under legal consolidation - 121.529.774 - (2.635.447) 13.898.047 4 Off-balance sheet items 36.444.918 4.885.849 - 22.104.507 - 5 Valuation differences - - - - - 6 Differences arising from netting of differences (other than line 2) - - - - - 7 Differences arising from consideration of provisions - - - - - 8 Differences arising from the applications of the BRSA - - - - Risk amounts 172.144.604 126.415.623 - 22.344.049 13.898.047 There is no significant difference between the amounts reported in the financial statements by TAS and the risk amounts used within the scope of capital adequacy. 103 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) INFORMATION ON CONSOLIDATED FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 6. Operational risk disclosures: According to the Parent Bank's Operational Risk Management Policy, operational risk management practices are developed taking into account the fact that errors and irregularities are overlooked as a result of failures in internal controls, the Bank's management and staff do not act in accordance with time and conditions, errors and failures in information technology systems, losses that may arise from disasters such as earthquakes, fires, floods, and losses caused by other factors that may occur on the Bank and sector basis. The amount based on the operational risk at the Bank is determined by Article 14 of the “Regulation on the Measurement and Evaluation of the Capital Adequacy of Banks”. It is calculated using the basic indicator method within the scope of the article. The value found by multiplying the average of fifteen percent of the bank’s year-end gross income amounts realized as of the last three years by twelve and a half is taken into account as the amount based on operational risk. Annual gross income is calculated by adding net interest income, net fee and commission income, dividend income from shares other than subsidiary and affiliate shares, commercial profit/loss (net) and other operating income, profit/loss from the sale of assets tracked in securities measured at amortised cost, extraordinary income and insurance indemnity amounts to net interest income as shown in the statement of profit or loss of financial reports. Total / Positive Current Period GI year Ratio (31.12.2024) 31.12.2021 31.12.2022 31.12.2023 number (%) Total Gross income 1.496.489 3.109.323 7.010.218 3.872.010 15 580.801 Amount subject to operational risk (Total*12,5) 7.260.018 Total / Positive Prior Period GI year Ratio (31.12.2023) 31.12.2020 31.12.2021 31.12.2022 number (%) Total Gross income 770.710 1.496.489 3.109.323 1.792.174 15 268.826 Amount subject to operational risk (Total*12,5) 3.360.326 The Operational Risk Management Policy, which has been renewed to determine the policy, principles, approach and basic elements on Operational Risk management in order to set out the risks that the Bank will be exposed to in line with its general strategies and long-term goals and the strategies it will follow for these risks, has been approved by the Board of Directors as of 30.12.2020. With this policy, it is aimed to contribute to the establishment of an settled and consistent "Operational Risk Culture" throughout the Bank through the identification, detection, measurement, evaluation and reporting of Operational Risks. It is envisaged that audit findings, internal loss data, risk control and self-assessment report, operational risk analysis report, external data, business process map and key risk indicators will be used in the identification and evaluation of operational risk. In order to analyze the operational risk, risk control and self-assessment studies, operational risk analysis report, scenario analysis and stress tests are planned to be carried out. As part of reducing operational risks and improving the effectiveness of the operational risk management process, controlling the risks incurred by applying established policies and procedures, reducing them using risk reduction techniques such as insurance, transferring them to another area, using methods such as the use of basic elements that will increase the effectiveness of operational risk management can be listed as the main elements that will increase the effectiveness of operational risk management. 104 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) INFORMATION ON CONSOLIDATED FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 6. Operational risk disclosures (Continued): The Bank's Support Services procedures, emergency and contingency plans, which enable the transfer of operational risks by obtaining some necessary support services from specialized organizations, as well as special policies, procedures and controls on money laundering and terrorist financing, which may cause operational risks, management of IT risks, are also envisaged to be established. In the Bank, all operational risks are within the framework of defining, evaluating, monitoring and controlling / reducing risks. All operational risks in the Bank, within the framework of the identification, evaluation, monitoring and control/reduction of risks, is managed under the supervision of the Board of Directors and the Audit Committee. The results of the activities of the Internal Audit Unit and Internal Control and Compliance Unit for monitoring operational risks are monitored and evaluated by the Audit Committee. Legal measurements for Operational Risk are made using the Basic Indicator Method within the scope of the Regulation on Measurement and Assessment of Capital Adequacy of Banks. Studies of other measurement methods for Measurement of Operational Risks within the scope of Basel and BRSA regulations are carried out by the Risk Management Unit. 7. Interest rate risk on banking accounts: The Parent Bank calculates the interest rate risk on banking book according to “Regulation on Measurement and Evaluation of Interest Rate Risk on Banking Book as per Standard Shock Method” and reports to the BRSA monthly. The interest rate risk report arising from the banking book includes the following items as assets: due from the Central Bank, money market receivables, due from banks, financial assets at fair value through other comprehensive income (excluding government debt securities), reverse repurchase agreements receivables, loan receivables, other financial assets measured at amortised cost and other receivables; liabilities consist of payables to the Central Bank, payables to money markets, payables to banks, funds obtained from repurchase agreements, securities issued, loans used, subordinated debts and other payables. 105 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FOUR (Continued) INFORMATION ON CONSOLIDATED FINANCIAL STRUCTURE AND RISK MANAGEMENT (Continued) X. Explanations Related to Consolidated Risk Management (Continued): 7. Interest rate risk disclosures in banking accounts (Continued): Economic value differences due to the interest rate instabilities calculated according to “Regulation on Measurement and Evaluation of Interest Rate Risk on Banking Book as per Standard Shock Method” are presented below for each currency. Current Period (31.12.2024) Applied Shock Gains / Equity – Currency (+/- x base points) Gains / Losses Losses / Equity 1 TL (+) 500 base points (208.081) %(0,86) 2 TL (-) 400 base points 180.657 %0,75 3 EURO (+) 200 base points 210.044 %0,87 4 EURO (-) 200 base points (255.784) %(1,06) 5 USD (+) 200 base points (120.901) %(0,50) 6 USD (-) 200 base points 132.945 %0,55 Total (For Positive Shocks) (118.939) %(0,49) Total (For Negative Shocks) (57.818) %(0,24) Prior Period (31.12.2023) Applied Shock Gains / Equity – Currency (+/- x base points) Gains / Losses Losses / Equity 1 TL (+) 500 base points (141.928) %(0,73) 2 TL (-) 400 base points 124.270 %0,64 3 EURO (+) 200 base points 209.535 %1,08 4 EURO (-) 200 base points (262.744) %(1,36) 5 USD (+) 200 base points (103.505) %(0,54) 6 USD (-) 200 base points 118.633 %0,61 Total (For Positive Shocks) (35.898) %(0,19) Total (For Negative Shocks) (19.841) %(0,10) 106 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS I. Explanations and Notes Related to Consolidated Assets: 1. Information on financial assets: 1.1. Information on cash and cash equivalents: 1.1.1 Information on cash and balances with the Central Bank of the Republic of Türkiye: Current Period Prior Period (31.12.2024) (31.12.2023) TL FC TL FC Cash in TL/Foreign currency 33 - 26 - CBRT 1.809 - 2.534 - Other - - - - Total 1.842 - 2.560 - 1.1.1.a. Information on required reserve deposits: Since the Parent Bank does not accept deposits, it is not subject to Central Bank of the Republic of Türkiye’s Communiqué No: 2005/1 ‘Reserve Requirements 1.1.1.b. Information on the account of Central Bank of the Republic of Türkiye: Current Period Prior Period (31.12.2024) (31.12.2023) TL FC TL FC Unrestricted demand deposit 1.809 - 2.534 - Unrestricted time deposit - - - - Restricted time deposit - - - - Total 1.809 - 2.534 - 1.1.2. Information on banks: Current Period Prior Period (31.12.2024) (31.12.2023) TL FC TL FC Banks Domestic 11.058.573 1.591.167 3.768.650 1.099.153 Foreign - 68.376 - 71.856 Foreign head office and branches - - - - Total 11.058.573 1.659.543 3.768.650 1.171.009 1.1.2.a) Information regarding Foreign Bank Accounts: Unrestricted Amount Restricted Amount Current Current Period Prior Period Period Prior Period (31.12.2024) (31.12.2023) (31.12.2024) (31.12.2023) EU Countries 35.789 47.652 - - USA and Canada 32.587 24.204 - - OECD Countries - - - - Off-Shore Banking Regions - - - - Other - - - - Total 68.376 71.856 - - 107 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) I. Explanations and Notes Related to Consolidated Assets (Continued) 1.1. Information on cash and cash equivalents (Continued): 1.1.3. Information on money market placements: Current Period Prior Period (31.12.2024) (31.12.2023) TL FC TL FC Money Market Placements 9.881.807 - 16.806.484 - Receivables from Reverse Repo Transactions 40.054 - 239.541 - Total 9.921.861 - 17.046.025 - 1.1.4 Information on expected credit loss provisions for financial assets Current Period Prior Period (31.12.2024) (31.12.2023) TL FC TL FC Cash and balances with Central Bank 6 - - - Banks 1.477 - 4.410 - Receivables from money market 3.592 - 11.382 - Total 5.075 - 15.792 - 1.2. Financial assets measured at fair value through profit or loss subject to repurchase agreements (Net): None. 1.2.a) Financial assets measured at fair value through profit or loss given as collateral or blocked (Net): None. 1.3. Information on financial assets measured at fair value through other comprehensive income: 1.3.a-1) Financial assets measured at fair value through other comprehensive income subject to repurchase agreements: Current Period Prior Period (31.12.2024) (31.12.2023) TL FC TL FC Share certificates - - - - Bonds, treasury bills and similar securities 861.643 - 706.459 - Other - - - - Total 861.643 - 706.459 - 1.3.a-2) Information on financial assets measured at fair value through other comprehensive income given as collateral or blocked: Current Period Prior Period (31.12.2024) (31.12.2023) TL FC TL FC Share certificates - - - - Bonds, treasury bills and similar securities 673.223 189.842 16.734 1.572.231 Other - - - - Total 673.223 189.842 16.734 1.572.231 108 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) I. Explanations and Notes Related to Consolidated Assets (Continued) 1.3. Information on financial assets measured at fair value through other comprehensive income (Continued): 1.3.a.3) Information on financial assets measured at fair value through other comprehensive income: Current Period Prior Period (31.12.2024) (31.12.2023) Debt Securities 25.518.203 15.203.882 Quoted on a stock exchange(*) 24.757.868 15.203.882 Unquoted 760.335 - Share Certificates 12.938 19.200 Quoted on a stock exchange - - Unquoted 12.938 19.200 Provision for impairment (-) (13.638) (2.467) Total 25.517.503 15.220.615 (*) Includes debt securities that are quoted on the stock exchange but not traded on the stock exchange at the end of the related period. 1.4. Information on derivative financial assets: Current Period Prior Period (31.12.2024) (31.12.2023) TL FC TL FC Forward transactions - - - - Swap transactions 144.142 - 65.528 188 Futures - - - - Options - - - - Others - - - - Total 144.142 - 65.528 188 2. Explanations on financial assets measured at amortised cost (Net): 2.1. Information on loans: 2.1.a) Information on all types of loans and advances given to shareholders and employees of the Parent Bank: None. 109 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) I. Explanations and Notes Related to Consolidated Assets (Continued) 2. Explanations on financial assets measured at amortised cost (Net) (Continued): 2.1. Information on loans (Continued): 2.1.b) Information on standard loans and loans under close monitoring (first and second group loans) including restructured loans under close monitoring: Loans Under Close Monitoring Restructured Loans Loans with Loans not Revised Cash Loans Standard Subject to Contract Current Period (31.12.2024) Loans Restructuring Terms Refinance Non-specialized loans 88.100.505 496.496 5.116.702 - Loans given to enterprises 5.183.382 - - - Export loans - - - - Import loans - - - - Loans given to financial sector 12.139.877 - - - Consumer loans - - - - Other 70.777.246 496.496 5.116.702 - Specialized loans 321.162 45.220 - - Other receivables - - - - Total 88.421.667 541.716 5.116.702 - Loans Under Close Monitoring Restructured Loans Loans with Loans not Revised Cash Loans Subject to Contract Prior Period (31.12.2023) Standard Loans Restructuring Terms Refinance Non-specialized loans 79.108.932 2.720.250 605.196 - Loans given to enterprises 8.603.353 - 6.002 - Export loans - - - - Import loans - - - - Loans given to financial sector 8.214.342 - - - Consumer loans - - - - Other 62.291.237 2.720.250 599.194 - Specialized loans 799.284 76.964 - - Other receivables - - - - Total 79.908.216 2.797.214 605.196 - Current Period Prior Period (31.12.2024) (31.12.2023) First and Second Stage Expected Standard Loans Under Standard Loans Under Close Loss Reserves Loans Close Monitoring Loans Monitoring 12 Months expected credit losses 578.282 - 624.594 - Significant increase in credit risk - 548.423 - 267.720 110 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) I. Explanations and Notes Related to Consolidated Assets (Continued) 2. Explanations on financial assets measured at amortised cost (Net) (Continued): 2.1. Information on loans (Continued): 2.1.c) Information on the distribution of cash loans according to maturity structure: Loans Under Close Monitoring Restructured Loans Loans not Loans with Cash Loans Subject to Revised Current Period (31.12.2024) Standard Loans Restructuring Contract Terms Refinancing Short-Term Loans 867.103 - - - Medium and Long-Term Loans 87.554.564 541.716 5.116.702 - Loans Under Close Monitoring Restructured Loans Loans not Loans with Cash Loans Subject to Revised Prior Period (31.12.2023) Standard Loans Restructuring Contract Terms Refinancing Short-Term Loans - - 6.002 - Medium and Long-Term Loans 79.908.216 2.797.214 599.194 - 2.1.ç) Information about loan movements: Stage I Stage II Stage III Total Beginning of Term (31.12.2023) 79.908.216 3.402.410 848.082 84.158.708 In-Term Supplement 26.978.172 2.598.780 89.694 29.666.646 Closed During the Period 35.915.294 1.539.477 205.026 37.659.797 Sold Loans - - - - Write-offs - - - - Transfer to Stage 1 - - - - Transfer to Stage 2 2.598.780 - - 2.598.780 Transfer to Stage 3 - 14.889 - 14.889 Foreign Exchange Effect 20.049.353 1.211.594 - 21.260.947 End of Term (31.12.2024) 88.421.667 5.658.418 732.750 94.812.835 2.1.d) Net value, collateral type and risk matching of collaterals of standard loans: Current Period Prior Period (31.12.2024) (31.12.2023) Net Value of Loan Net Value of Loan Type of Collateral Collateral (*) Balance Collateral (*) Balance Letter of Guarantee 31.304.969 34.339.936 29.886.086 32.857.560 Real Estate Mortgage 14.316.166 14.316.166 15.393.162 15.781.700 Other (Guarantee, commercial enterprise pledge, export documents, etc.) 13.643.855 13.643.855 12.078.300 12.078.300 Unsecured - 26.121.710 - 19.190.656 Total 59.264.990 88.421.667 57.357.548 79.908.216 (*) Between the appraisal and mortgage amount lower one and if these exceed the credit risk, loan amount is taken into account as the net value of the collateral. 111 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) I. Explanations and Notes Related to Consolidated Assets (Continued) 2. Explanations on financial assets measured at amortised cost (Net) (Continued): 2.1. Information on loans (Continued): 2.1.e) Net value, collateral type and risk matching of collaterals of loans under close monitoring: Current Period Prior Period (31.12.2024) (31.12.2023) Net Value of Loan Net Value of Loan Type of Collateral Collateral (*) Balance Collateral (*) Balance Letter of Guarantee 1.411.273 1.411.273 1.296.695 1.296.695 Real Estate Mortgage 4.226.228 4.226.228 2.060.988 2.060.988 Other (Guarantee, commercial enterprise pledge, export documents, etc.) 20.919 20.919 38.327 38.327 Unsecured - - - 6.400 Total 5.658.420 5.658.420 3.396.010 3.402.410 (*) Between the appraisal and mortgage amount lower one and if these exceed the credit risk, loan amount is taken into account as the net value of the collateral. 2.1.f) Information about consumer loans, personal credit cards, staff loans and staff credit cards: As of the balance sheet date, there are no consumer loans, personal credit cards, personnel loans and personnel credit cards. 2.1.g) Information about installment commercial loans and corporate credit cards: As of the balance sheet date, there are no installment commercial loans and corporate credit cards issued by the Bank. 2.1.ğ) Distribution of loans according to users: Current Period Prior Period (31.12.2024) (31.12.2023) Public 241.375 301.788 Private 94.571.460 83.856.920 Total 94.812.835 84.158.708 2.1.h) Distribution of domestic and international loans: Current Period Prior Period (31.12.2024) (31.12.2023) Domestic Loans 94.812.835 84.158.708 Foreign Loans - - Total 94.812.835 84.158.708 2.1.ı) Loans given to subsidiaries and associates: None. 2.1.i) Default (third stage) provisions: Current Period Prior Period (31.12.2024) (31.12.2023) Loans with limited collectability 508.374 494.166 Loans with doubtful collectability 34.473 - Uncollectible loans 33.504 34.614 Total 576.351 528.780 112 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) I. Explanations and Notes Related to Consolidated Assets (Continued) 2. Explanations on financial assets measured at amortised cost (Net) (Continued): 2.1. Information on loans (Continued): 2.1.j) Information on non-performing receivables (Net): 2.1.j.1) Information on non-performing loans and restructured loans: III. Group IV. Group V. Group Loans with Loans with Uncollectible Limited Doubtful Loans Collectability Collectability Current Period (31.12.2024) Gross amounts before provisions - 40.201 33.504 Restructured loans 644.156 14.889 - Prior Period (31.12.2023) Gross amounts before provisions 68.031 - 34.726 Restructured loans 745.325 - - 2.1.j.2) Information on the movement of non-performing receivables: III. Group IV. Group V. Group Loans with Loans with Uncollectible Limited Doubtful Loans Collectability Collectability Prior Period End Balance (31.12.2023) 813.356 - 34.726 Additions (+) 25.649 - 1.525 Transfer from other categories of non-performing loans (+) - 81.476 - Transfer to other categories of non-performing loans (-) (81.476) - - Collections (-) (113.373) (26.386) (2.747) Write-offs (-) - - - Sold (-) - - - Corporate and commercial loans - - - Consumer loans - - - Credit cards - - - Other - - - Current Period End Balance (31.12.2024) 644.156 55.090 33.504 Provision(-) (508.374) (34.473) (33.504) Net Balance on Balance Sheet 135.782 20.617 - 2.1.j.3) Information on accruals of interest, rediscount and valuation effect and their provisions calculated for under follow-up loans of banks which provide expected credit loss according to TFRS 9: III. Group IV. Group V. Group Loans with Loans with Uncollectible Limited Doubtful Loans Collectability Collectability Current Period (31.12.2024) Interest accruals and rediscount with valuation differences 124.673 13.884 23 Provision amount (-) (124.673) (13.884) (23) Net Balance - - - Prior Period (31.12.2023) Interest accruals and rediscount with valuation differences 94.657 - 45 Provision amount (-) (94.657) - (45) Net Balance - - - 113 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) I. Explanations and Notes Related to Consolidated Assets (Continued) 2. Explanations on financial assets measured at amortised cost (Net) (Continued): 2.1. Information on loans (Continued): 2.1.j.4) Information on non-performing receivables arising from loans granted in foreign currency: None 2.1.j.5) Information on gross and net amounts of non-performing loans by user groups: III. Group IV. Group V. Group Loans with Loans with Limited Doubtful Uncollectible Collectability Collectability Loans Current Period (Net) (31.12.2024) 135.782 20.617 - Loans to Real Persons and Legal Entities (Gross) 644.156 55.090 33.504 Provision amount (-) (508.374) (34.473) (33.504) Loans to Real Persons and Legal Entities (Net) 135.782 20.617 - Banks (Gross) - - - Provision amount (-) - - - Banks (Net) - - - Other Loans (Gross) - - - Provision amount (-) - - - Other Loans (Net) - - - Prior Period (Net) (31.12.2023) 319.190 - 112 Loans to Real Persons and Legal Entities (Gross) 813.356 - 34.726 Provision amount (-) (494.166) - (34.614) Loans to Real Persons and Legal Entities (Net) 319.190 - 112 Banks (Gross) - - - Provision amount (-) - - - Banks (Net) - - - Other Loans (Gross) - - - Provision amount (-) - - - Other Loans (Net) - - - 2.1.j.6) Net value, collateral type and risk matching of collaterals of non-performing loans: Current Period Prior Period (31.12.2024) (31.12.2023) Net Value of Loan Net Value of Loan Type of Collateral Collateral (*) Balance Collateral (*) Balance Letter of Guarantee 54.153 55.090 68.031 68.031 Real Estate Mortgage 666.666 668.201 769.378 770.537 Other (Guarantee, commercial enterprise pledge, export documents, etc.) - - - - Unsecured - 9.459 - 9.514 Total 720.819 732.750 837.409 848.082 (*) Between the appraisal and mortgage amount lower one and if these exceed the credit risk, loan amount is taken into account as the net value of the collateral. 114 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) I. Explanations and Notes Related to Consolidated Assets (Continued): 2. Explanations on financial assets measured at amortised cost (Net) (Continued): 2. 1. Information on loans (Continued): 2.1.k) Main principles of liquidating non-performing loans and other receivables: If there are collateral elements said in the fourth section of the Regulation on the Procedures and Principles Regarding the Classification of Loans and Provisions to be Reserved for them, these elements are converted into money as soon as possible as a result of both administrative and legal initiatives and the liquidation of the receivable is provided. In the case collaterals are not present; the Bank is engaged in substantive intelligence in various periods to determine whether any property holdings are subsequently acquired in order to apply for legal procedures, even if a certificate of insolvency is obtained for the debtor. Before and after liquidation process; the Bank reviews financial information of the debtor companies. Then, in the case it is agreed that the companies show indications of operating on an ongoing basis and probably are going to have contributions to the economy; the Bank tries to make collections through rescheduling the payment terms. 2.1.l) Explanations on write-off policy: Within the scope of the “Regulation Amending the Regulation on Procedures and Principles for Classification of Loans and Provisions to be Set Aside”, which entered into force after being published in the Official Gazette dated 6 July 2021 and numbered 31533, the portion of “Fifth Group-Loans in the Type of Loss” with life-time loss provision for which there is no reasonable expectation of recovery is deducted from records in accordance of TFRS 9 within the period deemed appropriate by the Bank beginning from the first reporting period following their classification in this group. As of 31 December 2024, the Bank does not have any credits deducted from its accounting records (31 December 2023: None). 2.2. Information on finance lease receivables (Net): The Group has no receivables arising from leasing transactions. (31 December 2023: None.). 2.3. Information on factoring receivables: None. 115 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) I. Explanations and Notes Related to Consolidated Assets (Continued): 2. Explanations on financial assets measured at amortised cost (Net) (Continued): 2. 1. Information on loans (Continued): 2.4.a) Information on government securities other financial assets measured at amortised cost subject to repurchase agreements: Current Period Prior Period (31.12.2024) (31.12.2023) Government bonds 2.576.811 2.057.668 Treasury bills - - Other government debt securities - - Total 2.576.811 2.057.668 2.4.b) Information on government securities given as collateral or blocked financial assets measured at amortised cost: Current Period Prior Period (31.12.2024) (31.12.2023) Government bonds 3.446.168 7.378.696 Treasury bills - - Other government debt securities - - Total 3.446.168 7.378.696 2.4.c) Information on government securities other financial assets measured at amortised cost: Current Period Prior Period (31.12.2024) (31.12.2023) Government bonds 9.784.858 13.077.571 Treasury bills - - Other government debt securities 617.517 482.369 Total 10.402.375 13.559.940 2.4.d) Information on other financial assets measured at amortised cost: Current Period Prior Period (31.12.2024) (31.12.2023) Debt Securities 10.402.375 14.475.337 Quoted on a stock exchange 10.402.375 14.475.337 Unquoted - - Provision for impairment (-) - - Total 10.402.375 14.475.337 2.4.e) Movement of other financial assets measured at amortised cost: Current Period Prior Period (31.12.2024) (31.12.2023) Balance at the beginning of the period 14.475.337 7.665.261 Foreign currency difference on monetary assets 554.804 2.479.122 Purchases during the year (*) 6.458.307 5.427.202 Disposals through sales and redemptions (**) (11.086.073) (1.096.248) Provision for impairment (-) - - Balance at the end of the period 10.402.375 14.475.337 (*) TL 2.605.245 arises from the rediscount increase in purchases during the year (31 December 2023: TL 2.175.960). (**) Disposals through sales and redemptions consist of TL 2.231.295 after coupon redemption rediscount reduction amount (31 December 2023: TL 258.738). 116 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) I. Explanations and Notes Related to Consolidated Assets (Continued): 3. Assets held for sale and discontinued operations (Net): None. 4. Information on equity investments: 4.1. Information on associates: 4.1.a) If there are subsidiaries that are not consolidated in accordance with the Communiqué on the Preparation of Consolidated Financial Statements of Banks and the relevant Turkish Accounting Standard, the reasons for not consolidation: Subsidiaries that are not included in the scope of consolidation because they are not financial affiliates are valued according to the cost method. 4.1.b) General information on associates: Bank's Share Ratio - If Address Different, Voting Ratio Bank's Risk Group Title (City/Country) (%) Share Ratio (%) 1 Maksan A.Ş. Malatya 20 31,14 4.1.c) Financial statement information of associates ordered above: Total Current Prior Shareholders’ Fixed Interest Securities Period Period (*) Total Assets Equity Assets Income Income Profit/Loss Profit/Loss Fair Value 1 760.432 529.734 65.554 - - 93.555 124.054 - (*) The financial information of Maksan A.Ş. is provided from the unreviewed financial statements without the implementation of inflation accounting as of 30 September 2024. Prior period profit/loss amount is provided from the unreviewed financial statements as of 30 September 2023. 4.1.d) Movement of associates: Current Period Prior Period (31.12.2024) (31.12.2023) Balance at the beginning of the period 10.586 10.586 Movements during the period - - Additions - - Bonus shares certificates - - Shares in current year profit - - Disposal - - TFRS 9 classification change - - Revaluation increase - - Provision for impairment (-) / Cancellation of provision - - Balance at the end of the period 10.586 10.586 Capital commitments - - Share percentage at the end of the period (%) - - 4.1.e) Sectoral information about associates and their carrying amounts: None. 4.1.f) Information on consolidated subsidiaries: None. 4.1.g) Associates quoted in the stock exchange: None. 117 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) I. Explanations and Notes Related to Consolidated Assets (Continued): 4. Information on equity investments(Continued): 4.2. Information on subsidiaries (Net) The Parent Bank does not have any capital requirement arising from its subsidiaries included in the consolidated capital adequacy standard ratio. 4.2.a) General information on subsidiaries The Parent Bank has 100% participation in Kalkınma Yatırım Varlık Kiralama Anonim Şirketi established on 28 May 2020 with a nominal capital of TL 50, and in Kalkınma Girişim Sermayesi Portföy Yönetimi Anonim Şirketi established on 17 November 2020 with a nominal capital of TL 1.800 that was increased to TL 50.000 on 19 August 2024. 4.2.a.1) General information on unconsolidated subsidiaries None. 4.2.a.2) General information on consolidated subsidiaries Bank’s share Address percentage-if different Bank’s risk group Title (City/Country) voting rate (%) share rate (%) 1 Kalkınma Yatırım Varlık Kiralama A.Ş. İstanbul 100 100 2 Kalkınma Girişim Sermayesi Portföy Yönetimi A.Ş. İstanbul 100 100 4.2.a.3) Financial statement information regarding subsidiaries in the order above: Current Shareholders’ Total Interest Securities Period Prior Period (*) Total Assets Equity Fixed Assets Income Income Profit/Loss Profit/Loss Fair Value 1 946 873 - - 407.117 347 432 - 2 60.334 51.557 4.377 - - 4.883 (4.443) - (*) The financial information of Kalkınma Yatırım Varlık Kiralama A.Ş. and Kalkınma Girişim Sermayesi Portföy Yönetimi A.Ş. are provided from the unaudited financial statements without the implementation of inflation accounting as of 31 December 2024. Prior period informations are provided from the unaudited financial statements without the implementation of inflation accounting as of 31 December 2023. 118 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) I. Explanations and Notes Related to Consolidated Assets (Continued): 4. Information on equity investments (Continued): 4.2. Information on subsidiaries (Net) (Continıed): 4.2.b) Movement of subsidiaries: Current Period Prior Period (31.12.2024) (31.12.2023) Balance at the beginning of the period 16.746 4.050 Movements during the period 27.280 12.696 Additions 30.000 6.536 Bonus shares certificates - 9.464 Shares in current year profit - - Disposals - - Revaluation increase - - Provision for impairment (-) / Cancellation of provision (2.720) (3.304) Balance at the end of the period 44.026 16.746 Capital commitments - - Share percentage at the end of the period (%) 100 100 4.2.c) Sectoral information about subsidiaries and their carrying amounts: Current Period Prior Period (31.12.2024) (31.12.2023) Banks - - Insurance companies - - Factoring companies - - Leasing companies - - Financing companies - - Other financial subsidiaries 44.026 16.746 4.2.ç) Subsidiaries quoted on the stock exchange: None. 4.3. Information on jointly controlled entities (joint ventures): The Parent Bank has no joint ventures. 5. Positive differences table related to derivative financial instruments held for hedging purposes: The Parent Bank does not have derivative financial instruments held for hedging purposes. 119 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) I. Explanations and Notes Related to Consolidated Assets (Continued): 6. Information on tangible assets: Real-Estates held Current Period ( 31.12.2024) Real-Estates for sale Vehicles Other Total Cost Balance at the beginning of the period 21.937 2.880 20.023 51.980 96.820 Provision for impairment - (650) - - (650) Movements during the period - - - - - -Additions 17.274 16.750 20.587 11.277 65.888 -Disposals (-) (20.985) (121) - (1.654) (22.760) -Transfer from investment properties - - - - - -Provision for impairment (-) - - - - - -Reversal from provision for impairment (-) - 650 - - 650 Balance at the end of the period 18.226 19.509 40.610 61.603 139.948 Accumulated Depreciation Balance at the beginning of the period 21.823 - 5.491 25.845 53.159 Movements during the period - - - - - -Depreciation charge 17.215 - 6.787 10.483 34.485 -Transfer from investment properties - - - - - -Disposals (-) (20.812) - - (1.629) (22.441) -Provision for impairment (-) - - - - - Balance at the end of the period 18.226 - 12.278 34.699 65.203 Net book value at the end of the period - 19.509 28.332 26.904 74.745 Real-Estates held Prior Period ( 31.12.2023) Real-Estates for sale Vehicles Other Total Cost Balance at the beginning of the period 19.184 37.740 23.972 46.008 126.904 Provision for impairment - (651) - - (651) Movements during the period -Additions 2.753 311.368 1.968 10.192 326.281 -Disposals (-) - (346.228) (5.917) (4.220) (356.365) -Transfer from investment properties - - - - - -Provision for impairment (-) - - - - - -Reversal from provision for impairment (-) - - - - - Balance at the end of the period 21.937 2.229 20.023 51.980 96.169 Accumulated Depreciation Balance at the beginning of the period 13.947 - 2.539 20.331 36.817 Movements during the period - - - - - -Depreciation charge 7.876 - 4.387 9.551 21.814 -Transfer from investment properties - - - - - -Disposals (-) - - (1.435) (4.037) (5.472) -Provision for impairment (-) - - - - - Balance at the end of the period 21.823 - 5.491 25.845 53.159 Net book value at the end of the period 114 2.229 14.532 26.135 43.010 120 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) I. Explanations and Notes Related to Consolidated Assets (Continued): 7. Information on intangible assets: Current Period Prior Period (31.12.2024) (31.12.2023) Cost Balance at the beginning of the period 58.597 39.853 Movements during the period - - -Additions 35.189 18.744 - Disposals - - Balance at the end of the period 93.786 58.597 Accumulated Amortisation Balance at the beginning of the period 26.274 18.180 Movements during the period - - -Amortization charge 15.330 8.094 -Disposals - - Balance at the end of the period 41.604 26.274 Net book value at the end of the period 52.182 32.323 8. Information on investment properties: None. 9. Information on current tax assets: The Group’s current tax asset is TL 9 (31 December 2023:TL 5). 121 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) I. Explanations and Notes Related to Consolidated Assets (Continued): 10. Information on deferred tax assets: As of 31 December 2024, the Group has a deferred tax asset of TL 496 144 (31 December 2023: TL324.243). The deferred tax asset is calculated over the temporary differences formed by the assets and liabilities followed by the book value in the Bank’s records and their tax base calculated in accordance with the tax legislation. In case the items that constitute the temporary differences are monitored among the equity items, the deferred tax asset/liability calculated over the said temporary differences are associated with the related equity items, and as of 31 December 2024, the Parent Bank has no tax assets calculated over the period loss or tax deduction (31 December 2023: None). Current Period Prior Period (31.12.2024) (31.12.2023) Deferred Tax Asset Differences between Book Value and Tax Value of Fixed 53.959 Assets 24.277 Interest rediscounts 2.833 2.815 Employee benefits provisions 28.429 19.148 TFRS 16 Leases 1.601 17 Personnel bonus premium provision 114.973 62.072 TFRS 9 Provision 353.560 289.035 Other 32.567 33.507 Total Deferred Tax Asset 587.922 430.871 Deferred Tax Liability Securities portfolio - Financial 26.766 13.684 Securities portfolio - Non-financial 44.825 78.545 TFRS 16 Leasing - 174 Derivative financial assets 36.976 14.225 Total Deferred Tax Liability 108.567 106.628 Net Deferred Tax Asset/(Liabilities) 479.355 324.243 11. Non-current assets held for sale and related to discontinued operations: The Group has no fixed assets held for sale or related to discontinued operations. 122 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) II. Explanations and Notes Related to Consolidated Liabilities: 1. Information on maturity structure of deposits: The Parent Bank is not accepting deposits. 2. Information on funds borrowed: 2.a) Information on banks and other financial institutions: Current Period Prior Period (31.12.2024) (31.12.2023) TL FC TL FC From Central Bank of the Republic of Türkiye(*) 21.894.170 - 17.995.416 - From domestic banks and institutions 10.280 7.607.345 - 4.666.865 From foreign banks, institutions and funds - 78.773.056 - 75.284.759 Total 21.904.450 86.380.401 17.995.416 79.951.624 (*) The securities amounting to TL 45.960.576 (31 December 2023: TL 34.276.146) received from the customers of the rediscount loans obtained from the Central Bank of the Republic of Türkiye were endorsed to the Central Bank of the Republic of Türkiye. 2.b) Maturity structure of funds borrowed: Current Period Prior Period (31.12.2024) (31.12.2023) TL FC TL FC Short-term 94.470 1.305.004 - 10.414.970 Medium and long-term 21.809.980 85.075.397 17.995.416 69.536.654 Total 21.904.450 86.380.401 17.995.416 79.951.624 2.c) Additional information for the areas of liability concentrations: As the Bank is not authorized to accept deposits, liabilities are composed of funds obtained from domestic and international financial institutions, medium and long term loans, securities issued and subordinated debt instruments. Most of the loans from international finance institutions are from World Bank, European Investment Bank, Council of Europe Development Bank, Islamic Development Bank, International Islamic Trade Finance Corporation, Black Sea Trade and Development Bank, KfW Development Bank, Asian Infrastructure Investment Bank, Japan Bank for International Cooperation and China Development Bank . Domestic loans originate from the Republic of Türkiye Ministry of Treasury and Finance and Central Bank of the Republic of Türkiye. 3. Information on funds provided under repurchase agreements: Current Period Prior Period (31.12.2024) (31.12.2023) TL FC TL FC Liabilities to money markets 115.332 - 223.415 - Funds provided under repurchase agreements 3.299.685 2.099 2.651.574 - Total 3.415.017 2.099 2.874.989 - 4. Information on securities issued (Net): Current Period Prior Period (31.12.2024) (31.12.2023) TL FC TL FC Asset backed securities - - 854.950 - Bonds - 3.735.924 - 3.321.427 Total - 3.735.924 854.950 3.321.427 123 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) II. Explanations and Notes Related to Consolidated Liabilities (Continued): 5. Explanations on funds: Of the TL 8.402.633 provided by the Bank (31 December 2023 : TL 6.397.933), TL 603.727 is from the World Bank (31 December 2023 : TL 328.577), TL 2.043 is from the European Commission Fund (31 December 2023 : TL 1.813), TL 183.542 is from the KfW Development Bank (31 December 2023 : None) and TL 311.025 is from the Republic of Türkiye Ministry of Treasury and Finance (31 December 2023 : TL 22.350) and TL 7.302.296 consists of funds from borrowers and banks (31 December 2023: TL 6.045.193). 6. Explanations on financial liabilities at fair value through profit and loss: None. 7. Negative differences table for derivative financial liabilities: Current Period Prior Period (31.12.2024) (31.12.2023) TL FC TL FC Forward transactions - - - - Swap transactions 17.382 3.507 15.195 3.104 Futures transactions - - - - Options - - - - Other - - - - Total 17.382 3.507 15.195 3.104 8. Information on factoring liabilities: None. 9. Explanations on financial lease payables (Net): Current Period Prior Period (31.12.2024) (31.12.2023) Gross Net Gross Net Less than 1 year 9.662 7.549 7.700 5.655 1-4 years 16.444 14.799 18.279 15.671 More than 4 years - - - - Total 26.106 22.348 25.979 21.326 10. Negative differences table related to derivative financial instruments held for hedging purposes: The Bank does not have derivative financial instruments held for hedging purposes. 11. Explanations on Provisions: 11.a) Foreign exchange loss provisions on the foreign currency indexed loans and finance lease receivables: There is no foreign exchange loss provisions on the foreign currency indexed loans and finance lease receivables (31 December 2023: None). 11.b) Expected credit loss provided for unindemnified non-cash loans: As of 31 December 2024, the first stage expected credit loss for non-compensated and non-cashed non- cash loans is TL 20.727 (31 December 2023: TL 53.480), third stage expected credit loss is TL 1 (31 December 2023: TL 1). 124 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) II. Explanations and Notes Related to Consolidated Liabilities (Continued) 11. Explanations on Provisions: (Continued) 11.c) Other provisions: i) As of 31 December 2024, there are 83 lawsuits filed against the Group and there is a risk amount of TL 19.762 The Group has provided litigation provision amounting to TL 5.139 (31 December 2023: TL 8.597) for the lawsuits that are expected or highly probable to be concluded against the Bank. Other provisions amounting to TL 100.000 (31 December 2023: TL 100.000) are provided for probable risks. ii) The Group accounts provisions for employee benefits in accordance with the Turkish Accounting Standards No: 19 and recognizes it in financial statements. As of 31 December 2024, the Group allocated provision for severance pay amounting to TL 54.724 (31 December 2023: TL 42.665), for unused vacation accruals amounting to TL 41.178 (31 December 2023: TL 21.521) and for planned employee benefits provision amounting to TL 383.244 (31 December 2023: TL 203.165). 11.c-1) Information regarding severance pay provisions: Current Period Prior Period (31.12.2024) (31.12.2023) Balance at the beginning of the period 42.314 20.061 Expenses during the period 20.397 23.076 Actuarial loss/gain (4.157) - Paid during the period (3.830) (823) Balance at the end of the period 54.724 42.314 12. Information on Current Tax Liability: 12.a) Information on current tax liability: 12.a.1) Information on tax provision: Current Period Prior Period (31.12.2024) (31.12.2023) Corporate Tax and Deferred Tax TL FC TL FC Corporate tax payable 747.352 - 498.718 - Deferred tax liability - - - - Total 747.352 - 498.718 - 12.a.2) Information on taxes payable: Current Period Prior Period (31.12.2024) (31.12.2023) Corporate tax payable 747.352 498.903 Taxation on income on marketable securities 2.938 5.393 Property tax - - Banking insurance transaction tax (BITT) 12.968 14.269 Foreign exchange transaction tax 94 287 Value added tax payable 3.318 1.542 Other 31.785 16.252 Total 798.455 536.646 125 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) II. Explanations and Notes Related to Consolidated Liabilities (Continued) 12. Information on current tax liability: 12.a.3) Information on premiums: Current Period Prior Period (31.12.2024) (31.12.2023) Social security premiums- Employee 6.949 4.281 Social security premiums- Employer 9.406 5.496 Bank social aid pension fund premium- Employee - - Bank social aid pension fund premium- Employer - - Pension fund membership fees and provisions- Employee 118 69 Pension fund membership fees and provisions- Employer 148 86 Unemployment insurance- Employee 453 268 Unemployment insurance- Employer 959 582 Other 91 57 Total 18.124 10.839 13. Information on deferred tax liabilities None. 14. Information on liabilities regarding assets held for sale and discontinued operations: The Group has no fixed asset liabilities related to assets held for sale or discontinued operations. 15. Information on subordinated debt instruments: Current Period Prior Period (31.12.2024) (31.12.2023) TL FC TL FC Debt instruments to be included in additional capital calculation 5.516.800 - 3.712.899 6.038.208 Subordinated loans 5.516.800 - 3.712.899 6.038.208 Subordinated debt instruments - - - - Debt instruments to be included in contribution capital calculation - 2.060.311 - 1.827.616 Subordinated loans - 2.060.311 - 1.827.616 Subordinated debt instruments - - - - Total 5.516.800 2.060.311 3.712.899 7.865.824 (*)Withthe approval of BRSA dated 19 April 2019, the subordinated loan amounting to EUR 150 million with an indefinite maturity and early repayment option at the end of the 5th year at the earliest, obtained from TWF Market Stability and Equilibrium Sub-Fund under the Türkiye Wealth Fund, was closed by repayment on 27 December 2024 by using the early repayment option. 16. If other liabilities exceed 10 % of the balance sheet total, name and amount of sub-accounts constituting at least 20 % of grand total: Other foreign resources item of the balance sheet does not exceed 10% of the balance sheet total 17. Information on shareholders’ equity: 17.a) Presentation of paid-in capital: Current Period Prior Period (31.12.2024) (31.12.2023) Common stock 5.500.000 2.500.000 Preferred stock - - 126 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) II. Explanations and Notes Related to Consolidated Liabilities (Continued): 17. Information on shareholders’ equity(Continued): 17.b) Paid-in capital amount, explanation whether the registered share capital system is applicable for the Bank, if so, amount of registered capital ceiling: Capital System Paid in Capital Ceiling Registered capital 5.500.000 10.000.000 17.c) Information on share capital increases and their sources; other information on increased capital shares in current period: Increase Profit Reserves Subject Capital Reserves Subject Increase Date Amount Cash to Increase to Increase 30.04.2024 3.000.000 3.000.000 - - 17.ç) Information on additions from capital reserves to capital in the current period: There is no increase from capital reserves. 17.d) Capital commitments until the end of the last fiscal year and the following interim period, the general purpose of these commitments and the estimated resources required for these commitments: The Bank has no capital commitments. 17.e) Information on legal reserves: Current Period Prior Period (31.12.2024) (31.12.2023) I. Legal reserve 408.146 205.969 II. Legal reserve 14.471 14.471 Special reserves - - Total 422.617 220.440 17.f) Information on extraordinary reserves: Current Period Prior Period (31.12.2024) (31.12.2023) Legal reserves that was allocated to be in compliance 7.536.109 3.695.073 with the decisions made on the Annual General Assembly Retained earnings - - Accumulated losses - - Foreign currency capital exchange difference - - Total 7.536.109 3.695.073 17.g) Indicators of the Bank’s income, profitability and liquidity for the prior periods and possible effects of these future assumptions based on the uncertainty of these indicators on the Bank’s equity: The Parent Bank’s prior year revenues, profitability and liquidity and projections in the future are followed by the relevant units. Considering the current conditions in the country’s economy and the Bank’s prior year performance; within the framework of forecasts regarding income, profitability and liquidity, it is estimated that there will be no significant problems in the upcoming period. 17.ğ) Information on preferred shares: The Bank has no preferred shares. 127 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) II. Explanations and Notes Related to Consolidated Liabilities (Continued): 17. Information on shareholders’ equity(Continued): 17.h) Information on accumulated other comprehensive income or loss that will be reclassified to profit or loss: Current Period Prior Period (31.12.2024) (31.12.2023) TL FC TL FC From associates, subsidiaries and jointly controlled entities (joint ventures) 10.931 - 10.931 - Valuation difference 553 91.451 62.055 87.350 Foreign exchange difference - - - - Total 11.484 91.451 72.986 87.350 III. Explanations and Notes Related to Consolidated Off-Balance Sheet Accounts 1. Information on off-balance sheet liabilities: 1.a) Nature and amount of irrevocable loan commitments: Current Period Prior Period (31.12.2024) (31.12.2023) Forward asset purchase and sales commitments 192.563 1.420.366 Other irrevocable commitments 772.787 262.965 Total 965.350 1.683.331 1.b) Nature and amount of possible losses and commitments from the off-balance sheet items including the below mentioned: As of 31 December 2024, the first stage expected credit loss for non-compensated and non-cashed non- cash loans is TL 20.727 (31 December 2023: TL 53.480), third stage expected credit loss is TL 1 (31 December 2023: TL 1). 1.b.1) Guarantees, confirmed bills and guarantees assessed as financial guarantees and non-cash loans including other letter of credits: The Group has guarantees given amounting to TL 633.011 (31 December 2023: TL 609.260). The Group has TL 133.709 letters of credit (31 December 2023: TL 118.700). The Bank has no bank loans as of the current period. 1.b.2) Definite guarantees, tentative guarantees, suretyships and similar transactions: The total amount of the Parent Bank’s letters of guarantee is TL 4.308.450 (31 December 2023: TL 4.145.080). TL 1 of this amount (31 December 2023: TL 1) is a customs guarantee letter and TL 155.520 (31 December 2023: TL 84.923) is a performance guarantee letters. 1.c-1) Total non-cash loans: Current Period Prior Period (31.12.2024) (31.12.2023) Non-cash loans for providing cash loans 4.919.649 4.669.416 With original maturity of one year or less - - With original maturity more than one year 4.919.649 4.669.416 Other non-cash loans 155.521 84.924 Total 5.075.170 4.754.340 128 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) III. Explanations and Notes Related to Consolidated Off-Balance Sheet Accounts (Continued) 1. Information on off-balance sheet liabilities (Continued) 1.c.2) Information about risk concentration on sector basis within the non-cash loans account: Current Period (31.12.2024) Current Period (31.12.2023) TL (%) FC (%) TL (%) FC (%) Agriculture - - - - - - - - Farming and Livestock - - - - - - - - Forestry - - - - - - - - Fishery - - - - - - - - Industry 149.188 %100,00 4.925.973 %100,00 84.915 %100,00 4.669.416 %100,00 Mining and quarrying - - - - - - - - Manufacturing Industry 1 - 133.709 %2,71 2.488 - - - Electricity, Gas, Water 149.187 %100,00 4.792.264 %87,29 82.427 %100,00 4.669.416 %100,00 Building - - - - - - - - Services 9 - - - 9 - - - Wholesale and Retail Trade - - - - - - - - Hotel and Restaurant Services - - - - - - - - Transportation and Communications - - - - - - - - Financial Institutions 9 - - - 9 - - - Real Estate and Rental Service - - - - - - - - Self-Employment Services - - - - - - - - Educational Services - - - - - - - - Health and Social Services - - - - - - - - Other - - - - - - - - Total 149.197 %100,00 4.925.973 %100,00 84.924 %100,00 4.669.416 %100,00 1.c.3) Non-cash loans classified in group I and II: Current Period Prior Period (31.12.2024) (31.12.2023) I. Group I. Group Non-cash loans TL FC TL FC Letters of guarantee 149.195 4.159.253 84.922 4.060.156 Letters of credit - 133.709 - - Other warranties - 633.011 - 609.260 Total 149.195 4.925.973 84.922 4.669.416 2. Information on derivative financial instruments: Derivative transactions of the group consists of currency swap purchasing and selling transactions. Swap transactions in foreign currency and their TL equivalents are shown in the table below as of 31 December 2024 and 31 December 2023. Current Period Prior Period (31.12.2024) (31.12.2023) Forward Forward Swap Forward Forward Swap Purchase Sale Purchase Swap Sale Purchase Sale Purchase Swap Sale TL - - 2.307.407 4.259.259 - - 982.007 9.153.209 USD - - 4.058.327 5.059.379 - - 6.794.888 1.934.433 EUR - - 3.046.797 - - - 3.239.969 - Other - - - - - - - - Total - - 9.412.531 9.318.638 - - 11.016.864 11.087.642 129 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) III. Explanations and Notes Related to Consolidated Off-Balance Sheet Accounts (Continued) 3. Information on contingent liabilities and assets: Istanbul Venture Capital Initiative (IVCI - A Luxemburg Investment Company Fund) was founded as a stock company having variable capital and subject to laws of Luxemburg. The Bank has committed to buy “Group A” shares equal to nominal value of EUR 10 million and to pay this amount at the date determined by Fund according to its investment plan. The Fund’s initial capital commitment was EUR 150 million and its capital was increased to EUR 160 million with new participants in March 2009. The Bank’s participation was approved by the Board of Directors of IVCI on 13 November 2007 and share purchase agreement was signed at of the same date. As of the balance sheet date, the Bank has paid EUR 9.998.342 of the EUR 10 million commitment, while EUR 1.658 has not been paid yet. The Bank has committed to invest TL 25.000 in the Development Participation Venture Capital Investment Fund, TL 15.000 in the Innovative and Advanced Technologies Venture Capital Investment Fund, USD 1,5 million in the Development ODTÜ Teknokent Venture Capital Investment Fund of which the Bank’s subsidiary Development Venture Capital Portfolio Management Inc. is the founder and manager. It has been paid a capital share of TL 25.000 to Participation Venture Capital Investment Fund; TL 15.000 to the Innovative and Advanced Technologies Venture Capital Investment Fund; USD 1,5 million to the Development ODTÜ Teknokent Venture Capital Investment Fund and as of the balance sheet date, the total commitment to these funds has been paid. The Bank has committed to invest TL 430.000 in the TKYB Capital Fund and USD 15 million to DIBT Fund of Funds of which Türkiye Development Fund is the founder and Development Venture Capital Portfolio Management Inc. is the manager. It has been paid a capital share of TL 183.940 and as of the balance sheet date, TL 246.060 of the total commitment to the fund has not been paid yet. It has been paid a capital share of USD 76 thousand and as of the balance sheet date, USD 14.924 thousand of the total commitment to the fund has not been paid yet. 4. Services supplied on behalf of others The Parent Bank does not act as an intermediary for purchases and sales of securities on behalf of others and provides custody services. 130 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) IV. Explanations and Notes Related to Statement of Consolidated Profit or Loss: 1.a) Information related to interest income on loans: Current Period Prior Period (31.12.2024) (31.12.2023) TL FC TL FC Interest on loans(*) Short term loans - 224.346 - - Medium and long term loans 3.510.861 5.733.379 1.941.631 4.933.847 Interest on non-performing loans 198.757 - 233.053 - Total 3.709.618 5.957.725 2.174.684 4.933.847 (*) Includes fees and commissions received from cash-loans. 1.b) Information related to interest income on banks: Current Period Prior Period (31.12.2024) (31.12.2023) TL FC TL FC From Central Bank of the Republic of Türkiye - - - - From domestic banks 3.892.531 52.271 2.840.771 14.743 From foreign banks - 7.632 - 3.838 From foreign head offices and branches - - - - Total 3.892.531 59.903 2.840.771 18.581 1.c) Information related to interest income on marketable securities: Current Period Prior Period (31.12.2024) (31.12.2023) TL FC TL FC Financial assets measured at fair value through profit or loss - - - - Financial assets measured at fair value through other comprehensive income 892.304 1.294.690 571.979 504.766 Financial assets measured at amortised cost 3.245.592 153.717 2.227.445 294.395 Total 4.137.896 1.448.407 2.799.424 799.161 1.ç) Information related to interest income from associates and subsidiaries: None. 1.d) Information on interest income from money market transactions: Current Period Prior Period (31.12.2024) (31.12.2023) TL FC TL FC Money market transactions 4.105.714 17.608 2.602.971 787 Reverse repurchase agreements 24.692 - 8.593 - Total 4.130.406 17.608 2.611.564 787 131 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) IV. Explanations and Notes Related to Statement of Consolidated Profit or Loss (Continued): 2.a) Information related to interest expense on borrowings: Current Period Prior Period (31.12.2024) (31.12.2023) TL FC TL FC Banks(*) 3.072.578 525.402 1.660.274 254.073 Central Bank of the Republic of Türkiye 3.072.578 - 1.660.274 - Domestic banks - - - - Foreign banks - 525.402 - 254.073 Foreign head office and branches - - - - Other Institutions(*) 1.803.986 4.710.176 1.412.300 3.902.030 Total 4.876.564 5.235.578 3.072.574 4.156.103 (*) Includes fees and commissions payable to cash-loans. 2.b) Information related to interest expenses to associates and subsidiaries: None. 2.c) Information related to interest on securities issued: Current Period Prior Period (31.12.2024) (31.12.2023) TL FC TL FC Interest Paid on Issued Securities - 259.906 - 182.028 2.ç) Information related to interest on money market transactions: Current Period Prior Period (31.12.2024) (31.12.2023) TL FC TL FC Money market transactions 95.505 - 11.140 - Repurchase agreements 1.300.111 5.101 516.972 - Total 1.395.616 5.101 528.112 - 2.d) Leasing interest expenses: Current Period Prior Period (31.12.2024) (31.12.2023) TL FC TL FC Immovables 3.220 - 1.047 - Movables 2.234 - 2.019 - Total 5.454 - 3.066 - 3. Information related to dividend income: Current Period Prior Period (31.12.2024) (31.12.2023) Financial assets measured at fair value through profit or loss 6.154 6.151 Financial assets measured at fair value through other comprehensive income 8.632 4.851 Other 14.249 11.874 Total 29.035 22.876 132 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) IV. Explanations and Notes Related to Statement of Consolidated Profit or Loss (Continued): 4. Information related to trading income/loss: Current Period Prior Period (31.12.2024) (31.12.2023) Gain 1.444.788 6.508.686 Gains on capital market operations 150.635 177.986 Gains on derivative financial instruments 903.304 4.241.721 Foreign exchange gains 390.849 2.088.979 Loss (-) (2.242.687) (7.112.166) Losses from the capital market operations (49.312) (15.515) Losses on derivative financial instruments (1.632.860) (2.255.617) Foreign exchange losses (560.515) (4.841.034) 5. Information related to other operating income: Current Period Prior Period (31.12.2024) (31.12.2023) Income from sale of assets 2.161 70.582 Reversals from prior years’ provisions 422.708 127.888 Other 11.238 24.864 Total 436.107 223.334 In general, the Parent Bank's other operating income consists of reversals of provisions for expected losses, share impairment provisions, litigation provisions, planned employee benefits provision set aside in previous years and income from sale of assets. 6. Group’s expected credit loss expenses and other provision expenses: Current Period Prior Period (31.12.2024) (31.12.2023) Expected credit loss provisions 734.524 492.037 12 month expected credit loss (Stage 1) 224.292 232.210 Significant increase in credit risk (Stage 2) 280.704 122.768 Non-performing Loans (Stage 3) 229.528 137.059 Marketable securities impairment expense 28.224 - Financial assets measured at fair value through profit or loss 28.224 - Financial assets measured at fair value through other comprehensive income - - Subsidiaries, associates and joint ventures provision expenses for impairment - - Associates - - Subsidiaries - - Joint ventures - - Other provision expenses (*) 423.122 345.475 Total 1.185.870 837.512 (*) Other provision expenses amounting to TL 43.167 (31 December 2023: TL 36.118) consist of provision for employment termination benefits and vacation pay liability expenses, provision for employee benefits amounting to TL 379.237 (31 December 2023: TL 203.165), provision for litigation expenses amounting to TL 718 (31 December 2023: TL 6.192) (December 31, 2023: TL 100.000 provision expenses for possible risks). 133 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) IV. Explanations and Notes Related to Statement of Consolidated Profit or Loss (Continued): 7. Information related to other operating expenses: Current Period Prior Period (31.12.2024) (31.12.2023) Provision for employee termination benefits(*) 20.397 23.447 Provision expense for bank social aid fund deficits - - Fixed assets impairment charges - - Depreciation charges of fixed assets 34.485 21.814 Intangible assets impairment charges - - Goodwill impairment charges - - Amortization charges of intangible assets 15.330 8.094 Impairment charges on investments accounted for at equity method - accounting - Impairment charges of assets that will be disposed - - Amortization charges of assets that will be disposed - - Impairment charges for non-current assets held for sale and discontinued - operations - Other operating expenses 152.608 102.390 Leasing expenses related to TFRS 16 exceptions 470 236 Maintenance expenses 714 709 Advertisement expenses 61 57 Other expenses (**) 151.363 101.388 Loss on sale of assets - - Other (***) 232.811 233.535 Total 455.631 389.280 (*) “Provision for Severance Pay” and “Provision for Short -Term Employee Rights” expenses are shown in the “Other Provision Expenses” line in the statement of profit or loss. (**) Other expenses consist of cleaning expenses amounting to TL 8.380 (31 December 2023: TL 4.051), communication expenses amounting to TL 22.389 (31 December 2023: TL 13.119), computer usage expenses amounting to TL 19.742 (31 December 2023: TL 19.796), heating, lighting and water expenses amounting to TL 2.006 (31 December 2023: TL 1.836), vehicle expenses amounting to TL 45.006 (31 December 2023: TL 23.889), dues amounting to TL 2.409 (31 December 2023: TL 1.287), participation share in common expenses amounting to TL 20.720 (31 December 2023: TL 12.039), insurance expenses amounting to TL 6.105 (31 December 2023: TL 5.269), miscellaneous expenses amounting to TL 9.079 (31 December 2023: TL 9.914) and the remaining portion amounting to TL 15.527 (31 December 2023: TL 10.118) consists of other miscellaneous expenses. (***) Other consists of taxes, duties, fees and funds expenses amounting to TL 123.455 (31 December 2023: TL 76.953), audit and consultancy fees amounting to TL 56.759 (31 December 2023: TL 26.746), BRSA participation share amounting to TL 27.479 (31 December 2023: TL 9.676) and other miscellaneous expenses amounting to TL 25.118 (31 December 2023: TL 9.749), (31 December 2023: TL 110.411 earthquake relief expenses). 8. Announcement of the fees related to the services received from the independent auditor or independent audit firm: By the decision of the POA dated 26 March 2021, the fee information for the reporting period regarding the services received from the independent auditor or independent audit firm is given in the table below, excluding VAT amounts. Current Period Prior Period (31.12.2024) (31.12.2023) Independent audit fee for the reporting period 8.688 2.267 Fee for tax advisory services - 163 Fee for other assurance services 890 563 Fees for services other than independent auditing - Total 9.578 2.993 134 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) IV. Explanations and Notes Related to Statement of Consolidated Profit or Loss (Continued): 9. Information related to operating profit/loss before taxes: The Group's profit before tax from continuing operations for the year ended December 31, 2024 is TL 8.708.125 (31 December 2023: TL 5.641.003). The Group has no discontinued operations. 10. Information on tax provision of continued and discontinued operations: In the accounting period ending on 31 December 2024, the Group’s income tax provision from continuing operations amounting to TL 2.532.590 (31 December 2023: TL 1.598.335) consists of TL 2.664.914 of current tax charge (31 December 2023: TL 1.762.726), TL 132.324 of deferred tax income effect (31 December 2023: TL 164.391). 1 January-31 December 1 January-31 December 2024 2023 Reconciliation of Tax Provision Profit/Loss Before Tax 8.708.125 5.641.003 Applicable Tax Rate %30 %30 Calculated Tax 2.612.438 1.692.301 Reconciliation of Allocated and Calculated Tax Provision Other (Effect of expenses not allowed by law, discounts, etc.) (79.848) (93.966) Tax Provision 2.532.590 1.598.335 11. Information on net profit and loss of continued and discontinued operations: Group has earned net profit of TL 6.175.535 from continuing operations between 1 January 2024-31 December 2024 (1 January 2023-31 December 2023: TL 4.042.668). 12. Information on net profit/loss: 12.a) The nature and amount of income and expenses from ordinary banking operations, if their feature, amount and frequency are required for the complete understanding of the performance of the Bank in the current period: None. 12.b) The effect of the change in accounting estimates to the net profit/loss; including the effects to the future period, if any: There are no changes in accounting estimates. 13. If the other items in the statement of profit or loss exceed 10 % of the statement of profit or loss total, sub-accounts amounting to at least 20 % of these items are presented below: The total amount of other fees and commissions received in the profit or loss statement for the accounting period ending on 31 December 2024 is TL 198.825 (31 December 2023: TL 223.468). Of this amount, TL 65.018 (31 December 2023: TL 6.028) consists of compensation for early terminated loans, TL 45.522 (31 December 2023: TL 28.703) consists of investment banking service income and TL 22.060 (31 December 2023: TL 13.210) consists of CBRT investment advance commissions. The total amount of other fees and commissions given in the statement of profit or loss for the accounting period ending on 31 December 2024 is TL 39.863 (31 December 2023: TL 176.945). Of this amount, TL 15.771 (31 December 2023: TL 24.483) consists of credit guarantee fund limit commissions, and TL 4.167 (31 December 2023: TL 13.481) consists of stock market transaction commissions. 14. Profit / loss attributable to minority rights: None. 135 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) V. Explanations and Notes Related to Statement of Changes in Shareholders’ Equity: The paid nominal capital amount in the legal records is TL 5.500.000 (31 December 2023: TL 2.500.000), as of the balance sheet date, the legal reserve funds balance is TL 422.617 (31 December 2023: TL 220.440), the extraordinary reserve funds balance is TL 7.536.109 (31 December 2023: TL 3.695.073) other profit reserves are TL 54.226 (31 December 2023: TL 54.260). The fair value difference of TL 57.774, which is the entire amount of valuation difference of securities, results from the change in value of financial assets measured at fair value through other comprehensive income. VI. Explanations and Notes Related to Consolidated Statement of Cash Flows: 1. Explanations related to “other” items and “effect of change in foreign currency rates on cash and cash equivalents” in statement of cash flows: The Parent Bank’s net cash inflow from banking activities amounts to TL 5.846.267. (31 December 2023: TL 8.008.734). The portion of the net cash inflow resulting from banking activities amounting to TL (1.060.222) (31 December 2023: TL 3.966.737) is from the change of asset and liability accounts; the portion amounting to 6.906.489. (31 December 2023: TL 4.041.997) arises from operating profit. The item “Net Increase (Decrease) in Other Debts” included in the change of asset and liability accounts arises from funds received, funds provided from repo transactions, miscellaneous debts, other foreign sources and changes in taxes, duties, fees and premiums to be paid as TL 1.589.040. (31 December 2023: TL 3.479.967). The “Other” item included in the operating profit consists of other operating expenses excluding fees and commissions paid and personnel expenses and was realized as TL (433.036) (31 December 2023: TL (1.109.202)). There is cash inflow and outflow from financing activities due to the cash capital increase and subordinated loan in 2024. The effect of the change in foreign exchange rate on cash and cash equivalent assets includes the exchange rate difference between the exchange rate on the day the foreign currency cash and cash equivalent assets were traded and the exchange rate on the reporting date and amounted to TL (365.060). (31 December 2023: TL 2.022.255). 136 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) VI. Explanations and Notes Related to Consolidated Statement of Cash Flows(Continued): 2. Explanations Cash and cash equivalents at the beginning of the period: 31.12.2023 31.12.2022 Cash 83.450 69.598 Cash in TL and foreign currencies 26 45 Demand deposits at banks 83.424 69.553 Cash equivalents 21.328.757 15.229.754 Interbank money market 16.535.221 6.603.772 Time deposits at banks 4.793.536 8.625.982 Total cash and cash equivalents 21.412.207 15.299.352 The total value found as a result of the transactions realized in the previous period gives the total of cash and cash equivalent assets of the current period. 3. Cash and cash equivalents at the end of the period: 31.12.2024 31.12.2023 Cash 81.471 83.450 Cash in TL and foreign currencies 33 26 Demand deposits at banks 81.438 83.424 Cash equivalents 21.666.244 21.328.757 Interbank money market 9.334.580 16.535.221 Time deposits at banks 12.331.664 4.793.536 Total cash and cash equivalents 21.747.715 21.412.207 137 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION FIVE (Continued) EXPLANATIONS AND NOTES RELATED TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) VII. Explanations Related to Risk Group of the Parent Bank: Predicted limitations determined in the Banking Law are maintained through internal regulations in the Bank which has no transactions related to deposit acceptance. For the transactions with risk groups, normal customer relationships and market conditions are taken into account. The Group adopts policies that restrict the balance of transactions with risk groups in total assets and liabilities. Practices are carried out in accordance with this policy. a) Current Period: Subsidiaries, Associates Other Real and Legal and Jointly Controlled Direct or Indirect Persons in the Risk Risk Group of the Parent Bank Entities (Joint Ventures) Shareholders of the Bank Group Cash Non-Cash Cash Non-Cash Cash Non-Cash Loans - - - - - - Beginning Balance 3.859 - - - - - Closing Balance (*) 3.856 - - - - - Interest and Commissions Income - - - - - - (*) TL 3.856 of loan disbursed to Arıcak A.Ş., a subsidiary of the Bank, has been followed in Group V. For this loan, TL 3.856 is set aside for the expected loss in the third stage. b) Prior Period: Subsidiaries, Associates Other Real and Legal and Jointly Controlled Direct or Indirect Persons in the Risk Risk Group of the Parent Bank Entities (Joint Ventures) Shareholders of the Bank Group Cash Non-Cash Cash Non-Cash Cash Non-Cash Loans - - - - - - Beginning Balance 3.839 - - - - - Closing Balance (*) 3.859 - - - - - Interest and Commissions Income - - - - - - (*) TL 3.859 of loan disbursed to Arıcak A.Ş., a subsidiary of the Bank, has been followed in Group V. For this loan, TL 3.859 is set aside for the expected loss in the third stage. c) Information on forward transactions, option contracts and similar other transactions between the Parent Bank and its risk groups: None. d) Information on remuneration and benefits provided for the senior management of the Parent Bank: The total of benefits provided to the top management of the Parent Bank is TL 42.962 (31 December 2023: TL 21.540). VIII. Explanations Related to Domestic, Foreign, Off-shore Branches and Representatives Offices Abroad: None. 138 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION SIX OTHER EXPLANATIONS I. Other Explanations Related to Operations of the Bank: a) The Summary of Information on the Parent Bank’s rating by International Rating Agencies: The international ratings of the Parent Bank are performed by Fitch on 17 September 2024. 2024 Foreign Currency Long Term BB- Short Term B Outlook Stable Turkish Lira Long Term BB- Short Term B Outlook Stable National Long Term AAA (TUR) Government Support Note bb- Outlook Stable 2023 Foreign Currency Long Term B Short Term B Outlook Stable Turkish Lira Long Term B Short Term B Outlook Stable National Long Term AAA (TUR) Government Support Note b Outlook Stable II. Explanations and Notes Related to Subsequent Events: With the decision of the Board of Directors of the Bank dated 18 December 2024, it has been decided to increase the issued capital of the Bank from TL 5.500.000 to TL 10.000.000 within the registered capital ceiling set as TL 10.000.000 in order to increase placement opportunities. The necessary application was made to the Capital Markets Board on 15 January 2025 for the approval of the Draft Prospectus for the shares with a nominal value of TL 4.500.000 to be issued in this way. With the Board of Directors decision dated January 24, 2025, it was decided to increase the capital of Kalkınma Yatırım Varlık Kiralama A.Ş. from TL 50 to TL 250 by increasing TL 200 in cash. 139 (Convenience Translation of Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) TÜRKİYE KALKINMA VE YATIRIM BANKASI A.Ş. Notes to the Consolidated Financial Statements as of 31 December 2024 (Thousands of Turkish Lira (TL) unless otherwise stated) SECTION SEVEN INDEPENDENT AUDIT REPORT I. Explanations on Independent Auditors’ Report: The Bank’s consolidated financial statements as of and for the period ended 31 December 2024 have been audited by Güney Bağımsız Denetim ve Serbest Muhasebeci Mali Müşavirlik A.Ş. (a member firm of Ernst&Young Global Limited) and the audit report dated 6 February 2025 is presented at the beginning of the financial statements and related notes. II. Explanations and Notes Prepared by Independent Auditor: None. 140