DEBT SECURITIES MARKET

The Debt Securities Market is comprised of the Outright Purchases and Sales Market, where the secondary market transactions of debt securities are conducted; the Offering Market for Qualified Investors, where the capital market instruments of the corporations whose equities are traded on Borsa İstanbul Equity Market are issued to “qualified investors” as defined in the capital markets legislation; the Repo-Reverse Repo Market, where repo-reverse repo transactions are conducted; the Interbank Repo-Reverse Repo Market, where the repo-reverse repo transactions are conducted only by the banks for their own portfolios; the Repo Market for Specified Securities, where repo-reverse repo transactions with specified debt securities are conducted; the Equity Repo Market where repo- reverse repo transactions are carried out with the shares of the companies that are traded on Borsa İstanbul Equity Market and which are included in BIST 30 Index; and International Bonds Market, where foreign debt instruments issued by the Turkish Undersecretariat of Treasury and listed by Borsa İstanbul are conducted. There is also Negotiated Repo Deals Market, which allows repo-reverse repo transactions to be conducted with the preferred counterparties.

Debt securities, securitized asset and income backed debt securities, lease certificates, liquidity bills issued by the Central Bank of the Republic of Turkey and other securities which are approved by Borsa İstanbul Board, which are denominated in TRY and foreign currencycan be traded on the Debt Securities Market.

Trading is conducted electronically in the Debt Securities Market via the automated multiple price-continuous auction system.

Sub-Markets of the Debt Securities Market were launched on the following dates:

• Outright Purchases and Sales Market; June 17, 1991.
• Repo-Reverse Repo Market; February 17, 1993.
• Offering Market for Qualified Investors; May 17, 2010.
• Repo Market for Specified Securities; December 17, 2010.
• Interbank Repo-Reverse Repo Market; January 7, 2011.
• Equity Repo Market; December 7, 2012.
• Negotiated Repo Deals Market; February 2, 2016.
• International Bonds Market; April 16, 2007 (conducted under Debt Securities Market since September13, 2013)

Central Bank of the Republic of Turkey and the intermediary institutions, which are members of Borsa İstanbul and Banks can carry out transactions in the Debt Securities Market.

Settlement operations are realized by İstanbul Settlement and Custody Bank Inc. (Takasbank).

Transactions are conducted on the following markets:

Outright Purchases and Sales Market
Fixed income securities are traded on the Outright Purchases and Sales Market, which is an organized and transparent secondary market.

Repo- Reverse Repo Market
Fixed income securities are sold with a re-purchase agreement (repo) and are bought with a re-sale agreement (reverse repo) in the Repo-Reverse Repo Market, which is one of the leading organized repo markets in the world.

Interbank Repo-Reverse Repo Market
The Interbank Repo-Reverse Repo Market was established to facilitate the repo-reverse repo transactions in organized market conditions, without having to meet the reserve requirement of the Central Bank, which is applied when a bank carries out repo transactions with a non-bank party.

Repo Market for Specified Securities
This Market provides the opportunity to realize repo transactions on specified debt securities within the organized market and then to deliver such securities to the buyer. It provides the means to exchange the security in a specified period, ensuring the flow of the securities between the forward and spot markets.

Equity Repo Market
This market provides a means for carrying out repo transactions on company shares within an organized market framework. Shares acquired through repo transactions are delivered to the buyer for the duration of the contract.

Negotiated Repo Deals Market
This Negotiated Repo Deals Market was established in order to enable the members to perform selling transactions with the commitment of repurchasing and buying transactions with the commitment of reselling by determing the counterparty they prefer to trade.

Offering Market for Qualified Investors
The Offering Market for Qualified Investors is the market where the debt securitiesof the issuers defined in the related CMB Communiqué are issued to “qualified investors” as defined in the capital markets legislation, in accordance with the regulations of the Capital Markets Board of Turkey.

International Bonds Market
Foreign Debt Securities (“Eurobonds”) issued by the Turkish Undersecretariat of Treasury and listed by Borsa İstanbul are traded in Internatioanal Bonds Market.