FINANCIAL RIGHTS PROVIDED TO THE MEMBERS OF THE GOVERNING BODY AND SENIOR EXECUTIVES

The Remuneration policy of the Bank was prepared in line with the BRSA’s Communiqué on “Corporate Management of Banks” and “Guidance on Good Remuneration Practices in Banks” and within the scope of the principle of proportionality, the content, structure and strategies of the Bank’s activities, long-term targets, the risk management structure of the Bank and local regulations. These regulations aim to prevent taking excessive risks and evaluate actual contributions to the risk management.

Our Remuneration Policy is intended to encourage TEB to manage risks within the principles and parameters defined and approved by its Board of Directors.

The purpose of our Remuneration policy is also to ensure that TEB can attract and retain competent and expert employees both in commercial and control functions that will help to fulfill its strategic objectives.

SECOM (Selection and Compensation Committee) is responsible, on behalf of the Board of Directors, for ensuring that the remuneration policy is prepared in line with local laws, regulations, TEB Policies and BNP Paribas regulations. SECOM manages the principles of the remuneration policy, taking opinions from the HR, Financial Affairs, Risk, Compliance and Internal Control Groups. The remuneration policy is reviewed and approved by SECOM and submitted to the Board of Directors. The remuneration policy is reviewed annually.

The main duties and responsibilities are as follows:

• Formation of a written Remuneration Policy which is in compliance with the BRSA Regulation
• Determination, monitoring and supervision of remuneration implementations (including salaries, performance bonuses, premiums, awards and fringe benefits).
• Approval of the principles and policies of remuneration for qualified employees as suggested by the General Directorate.
• Annual submission to the BoD the proposals with respect to the evaluation of Remuneration policy and implementations under the risk management.
• Determination of the criteria for the payments of performance bonuses to the employees based on the business line’s, group’s or employees’ personal performances and announcement of such criteria to the employees and regular review of such criteria according to the determined standards and special duties and responsibilities.
• To review the amendments to the remuneration criteria annually. The main purpose of such review is also to ensure that the Remuneration policy does not encourage excessive risk taking nor create conflict of interest between the management and the risk control and the internal control systems.
• SECOM considers the risk policy and other policy documents of the Bank in order to ensure the alignment of the current organization chart, reporting lines, separation of duties and Remuneration policy.

At the Ordinary General Assembly Meeting convened on 27 March 2017, a decision was adopted to pay Independent Board Member Alain Georges August Fonteneau a monthly gross remuneration of TL 6,000 in consideration for his role as an independent board member until the expiration of his such capacity, and not to pay an attendance fee to other Board members in consideration of their such roles.

During 2017, any and all rights, interests and remunerations paid to our Board members and senior executives amounted to TL 34,280,610 TL, and travel, accommodation and entertainment expenses amounted to TL 1,846,158 TL.

Board members may be granted loans within the legally defined limits or may be remunerated depending on various criteria including the Bank’s performance, the positions they hold and the time they allocate.