Milli Reasurans T.A.S.

Real GDP growth in Turkey of 5.2%, 2.8%, and 3.4% in 2022, 2023, and 2024 respectively. Very high inflation of about 74% in 2022, 40% in 2023 before moderating to 18% in 2024. Incorporated in Istanbul, Milli Reasurans T.A.S. is the leading national reinsurer in Turkey. Its parent, Turkiye Is Bankasi AS, set it up in 1929 to operate the compulsory reinsurance system. Isbank is one of the largest commercial banks in Turkey and owns 87.6% of the reinsurer. In turn, Milli Re is the principal shareholder (57.3%) of Anadolu Anonim Turk Sigorta Sirketi (Anadolu), one of the largest non-life insurance companies in Turkey. During the first nine months of 2022, GWP grew by 93% (in TRY terms) driven by

...S&P Global Ratings expects Milli Reasurans T.A.S.(Milli Re) to maintain its leading position in the Turkish reinsurance market. Milli Re's status as the leading national reinsurer remains a key rating strength. Its experienced management team has maintained the company's market position for a long time. Although Milli Re remains concentrated in Turkey for its premium generation, the international division continues to provide geographic and business line diversification. Milli Re's capital adequacy and liquidity will remain under pressure over the next two years. Turkey has seen rampant inflationary pressures and severe Turkish lira (TRY) weakness, which have resulted in additional insurance liability reserve creation on Milli Re's balance sheet. We expect Milli Re's capital adequacy to fall well below the '###' level, measured using our risk-based capital model in 2022 and over the forecast period to 2024, primarily due to high-inflation-induced premium growth and volatile underwriting...

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