PASHA BANK ENG 20

PASHA Yatırım Bankası A.Ş. Notes to Unconsolidated Financial Statements at 31 December 2020 (Amounts are expressed in thousands of Turkish Lira (“TL”) unless otherwise stated.) (Convenience Translation of Publicly Announced Financial Statements Originally Issued in Turkish, See Note I of Section Three) INFORMATION RELATED TO UNCONSOLIDATED FINANCIAL POSITION AND RISK MANAGEMENT(Continued) Locally and internationally accepted risk models and parameters are used in the identification, measurement and monitoring of risks within the scope of risk management. The Bank strives continuously for development and improvement of internal methods and models. Forward looking risk reports prepared through regular and close monitoring of the market developments are made available for the Senior Management and the Board of Directors. In order to analyse the potential risks that the Bank may be exposed in extreme cases, various scenario analyses are performed and contingency plans are prepared. The Bank’s internal capital adequacy assessment process (“ICAAP”) has been established and the ICAAP has been performed parallel to the annual budget process on an annual basis. Moreover, various risk mitigation techniques are utilized to limit and provide protection against risks the Bank is exposed to. The effectiveness and efficiency of the risk mitigation techniques are regularly monitored. b. General view to risk weighted amounts Risk weighted amounts Minimum capital requirements Current Period Prior Period Current Period 31 December 2020 31 December 2019 31 December 2020 Credit risk (excluding counterparty credit risk) (CCR) 2,009,956 1,576,612 160,796 Of which standardised approach (SA) 2,009,956 1,576,612 160,796 Of which internal rating-based (IRB) approach - - - Counterparty credit risk 5,575 8,302 446 Of which standardised approach for counterparty credit risk (SA-CCR) 5,575 8,302 446 Of which internal model method (IMM) - - - Equity positions in banking book under market-based approach - - - Equity investments in funds - look-through approach - - - Equity investments in funds - mandate-based approach 25,366 - 2,029 Equity investments in funds - fallback approach - - - Settlement risk - - - Securitisation exposures in banking book - - - Of which IRB ratings-based approach (RBA) - - - Of which IRB Supervisory Formula Approach (SFA) - - - Of which SA/simplified supervisory formula approach (SSFA) - - - Market risk 37,100 26,276 2,968 Of which standardised approach (SA) 37,100 26,276 2,968 Of which internal model approaches (IMM) - - - Operational risk 141,044 102,666 11,284 Of which Basic Indicator Approach 141,044 102,666 11,284 Of which Standardised Approach - - - Of which Advanced Measurement Approach - - - Amounts below the thresholds for deduction (subject to 250% risk weight) - - - Floor adjustment - - - Total 2,219,041 1,713,856 177,523 Annual Report 2020 PASHA Bank Year-End Financial Report 167