2025 Clal Insurance Enterprises Holdings Ltd. Financial Statements as of March 31,

IMPORTANT

This document is an unofficial translation for convenience only of the Hebrew original of the March 31, 2025, financial report of Clal Insurance Enterprises Holdings Ltd. that was submitted to the Tel-Aviv Stock Exchange and the Israeli Securities Authority on May 29, 2025.

The Hebrew version submitted to the TASE and the Israeli Securities Authority shall be the sole legally binding version.

Quarterly Report As of March 31, 2025

May 28, 2025

1.	Report of the Board of Directors	1-1
2.	Condensed Consolidated Interim Financial Statements	2-1
3.	Separate Financial Data from the Consolidated Interim Financial Statements Attributable to the Company (Regulation 38C)	3-1
4.	Report on the Effectiveness of Internal Control over Financial Reporting and Disclosure	4-1
5.	Solvency Ratio Report for Clal Insurance as of December 31, 2024	5-1

Clal Insurance Enterprises Holdings Ltd. Report of the Board of Directors

As of March 31, 2025

1.	The Group's Structure, its Areas of Activity, and Developments Therein
	1.1	The Group's Structure	1-3
	1.2	The Group's Areas of Activity and Developments Therein	1-3
2.	Board of Directors' Explanations for the State of the Corporation's Business
	2.1	Significant events during and subsequent to the Reporting Period	1-4
	2.2	Financial information by area of activity	1-7
	2.3	Additional credit card data	1-15
	2.4	Capital and capital requirements	1-16
	2.5	Analysis of cash flow development, sources of financing and liquidity	1-22
3.	Developments and Material Changes in the Macroeconomic Environment in the Reporting Period		1-27
	3.1	Key economic data	1-27
	3.2	Key trends and material changes in the macroeconomic environment in the Reporting Period and thereafter	1-27
4.	Restrictions on and supervision of the corporation's business		1-30
5.	Exposure to Market Risks and Management Thereof		1-32
6.	Risk Review for Max		1-34
7.	Disclosure regarding Financial Reporting of the Corporation
	7.1	Reporting Critical Accounting Estimates	1-51
	7.2.	Contingent Liabilities	1-51
	7.3	Internal Control over Financial Reporting and Disclosure	1-51

Report of the Board of Directors on the State of the Corporation's Affairs for the Period ended March 31, 2025 (hereinafter - the "Report of the Board of Directors") reviews the key changes in the activity of Clal Insurance Enterprises Holdings Ltd. (hereinafter - the "Company") in the first three months of 2025 (hereinafter - the "Reporting Period").

The Report of the Board of Directors was prepared in accordance with the Securities Regulations (Periodic and Immediate Reports), 1970. The Report of the Board of Directors, with respect to the insurance business, was drawn up in accordance with the Supervision of Insurance Business Regulations (Reporting), 1998, and in accordance with the circulars of the Commissioner of the Capital Market, Insurance and Savings Authority (hereinafter - the "Commissioner"); the Report of the Board of Directors, with respect to the credit cards business, was drawn up in accordance with the reporting directives of the Banking Supervision Department (hereinafter - the "Banking Supervision Department") bearing in mind that the reader also has on hand the full periodic report of the Company for the year ended December 31, 2024 (hereinafter - the "Periodic Report" and/or "Annual Financial Statements").

Forward-looking information

The following report of the Company may contain, in addition to data relating to the past, also forward-looking information, as defined by the Securities Law, 1968. Forward-looking information, to the extent that it is included, is based, among other things, on estimates and assumptions by the Group's managements and subsidiaries and on forecasts regarding the future in connection with economic and other developments in Israel and across the world, legislative and regulatory provisions, competition in the Group's areas of activity, accounting and taxation changes and technological developments. Although the Company's consolidated companies believe their assumptions to be reasonable as of the report date, by nature they are not certain, and actual results may materially differ from those predicted; therefore, the readers of the report should treat this information with due cation.

1. The Group's Structure, its Areas of Activity, and Developments Therein

1.1 The Group's Structure

The Company's shareholders

In the Commissioner's letter of December 8, 2019, it was stated that no entity holds, whether directly or indirectly, the means of control in the Company.

For further details regarding shareholdings in the Company and changes during the Reporting Period, see Note 1 to the Consolidated Interim Financial Statements.

1.2 The Group's Areas of Activity and Developments Therein

1.2.1 For a description of the Group's areas of activity and its holding structure, see Section 1.1 in the chapter entitled Description of the Corporation's Business in the 2024 Periodic Report.

2. The Board of Directors' Explanations for the State of the Corporation's Business

The Group companies' operations are affected by constant regulatory changes and regulatory reforms. Clal Insurance's operations and results are significantly affected by changes in capital markets, including, among other things, by changes in the interest rate that has implications for Clal Insurance's insurance liabilities and financial assets portfolios, for financial margins from investments as well. Max's activity is affected by macroeconomic conditions, the cost of living and interest rate in Israel. Macroeconomic conditions impact the level of private and business consumption, which, in turn, affect the Company's turnovers and have direct consequences on its business results.

As explained in Note 2 to these Interim Financial Statements, as from January 1, 2025 Clal Insurance has adopted IFRS 9 and IFRS 17 for the first time (hereinafter - the "Reporting Standards"), and the transition date for reporting under the Reporting Standards is January 1, 2024. The effect of the transition to reporting in accordance with the Reporting Standards regarding the Group's financial position and operating results with respect to the financial data of its subsidiary is detailed in Note 15 to these Interim Financial Statements.

2.1 Significant Events during and Subsequent to the Reporting Period:

A. Approval of the Company's dividend distribution

According to the Company's policy (see Note 17(c)1 to the Annual Financial Statements), on May 28, 2025, the Company's Board approved a dividend distribution totaling approx. NIS 200 million, which constitutes approx. 64% of the dividends declared and/or distributed in the Company's subsidiaries as of the approval date of the Consolidated Interim Financial Statements.

B. Solvency ratio, revision of capital target and dividend distribution in Clal Insurance

Clal Insurance published an Economic Solvency Ratio Report as of December 31, 2024, whereunder the ratio net of the Provisions for the Transitional Period after the dividend distribution is 128% compared with a ratio of 109% as of December 31, 2023.

Taking into consideration the Provisions for the Transitional Period, the ratio after dividend distribution and revision of the Deduction is 158% as of December 31, 2024, compared to 159% as of December 31, 2023, respectively. For further details, see Section 2.4 and Note 6 to the Consolidated Interim Financial Statements.

In accordance with Clal Insurance's dividend distribution policy (see Note 17(c)2 to the Annual Financial Statements), on May 28, 2025, Clal Insurance revised the minimum capital target without taking into account the Transitional Provisions, such that subsequent to the dividend distribution the solvency ratio will be at least 115% compared to 110%. In addition, Clal Insurance's Board approved a dividend distribution of approx. NIS 300 million, which constitutes approx. 47% of Clal Insurance's 2024 comprehensive income in accordance with the Annual Financial Statements (approx. 25% of Clal Insurance's comprehensive income after the application of the Reporting Standards), having examined all aspects, including Clal Insurance's compliance with the economic solvency ratio targets detailed above.

Taking into consideration equity transactions that took place subsequent to December 31, 2024, as of the publication date of the Economic Solvency Ratio Report as of December 31, 2024.

C. Capital markets and risk-free interest rate curve during the Reporting Period and thereafter

The results in the Reporting Period were affected by volatility in the capital markets, mainly in stock indices, which affected investment revenue in the nostro portfolio, and by an increase in the risk-free interest rate curve compared to a decrease in the corresponding period last year. For details regarding the impacts of the above on the results, see Section 2.2 below.

D. Debt raising by Clal Insurance Capital Raising Ltd. a subsidiary of Clal Insurance

Subsequent to the reporting date, in April 2025, Clal Capital Raising issued to the public Bonds (Series N) totaling NIS 500 million (hereinafter - the "Bonds"), by virtue of a shelf prospectus dated April 9, 2025. The principal will be repaid in one lump sum on September 30, 2039, unless Clal Capital Raising exercises its right to execute early redemption of the bonds. The principal and interest are not non-linked. The interest payable on the Bonds (Series N) is paid annually in two semi-annual installments starting on September 30, 2025, and on March 31 and September 30 of each calendar year between 2026 and 2039. The annual nominal interest rate is 5.51% and the annual effective interest rate is 5.72% assuming redemption on the Effective Date for Additional Interest. The issuance costs amounted to approx. NIS 5,820 thousand. For further details, see Note 5F to the Consolidated Interim Financial Statements.

E. Debt raising by Max and its becoming a reporting corporation

On January 6, 2025, Max completed a private placement of commercial papers for institutional entities, by way of expanding CPs (Series 2) by approx. NIS 154 million.

Subsequent to the reporting date, on April 7, 2025, Max published a supplementary prospectus and a shelf prospectus dated April 8, 2025, and on April 24, 2025, it completed a NIS 207 million raising of Commercial Papers (Series 5) from institutional investors and - for the first time - also from the public. As from this date, Max became a reporting corporation, as defined by the Securities Law, 1968. Max's becoming a reporting corporation constitutes a part of its financing strategy as a growing company, and it allows Max to diversify its sources of financing for its operating activities. For further details, see Note 13(F) to the Consolidated Interim Financial Statements.

F. The Iron Swords War

Further to Note 46(m) to the 2024 Financial Statements, 2025 started with ceasefire agreements on the northern front and the Gaza Strip front, which led to a relative calm. In March 2025, the temporary ceasefire between Israel and Hamas ended and the IDF resumed fighting in the Gaza Strip. This move led to increased tensions at the national and security levels, including, among other things, the resumption of missile attacks on Israel by the Houthis in Yemen. As of the report approval date, foreign airlines announced once again the cancellation of their flights to Israel.

Israel's credit rating

As of the approval date of the Financial Statements, the State of Israel's credit rating remains stable, but with a negative outlook, in accordance with the assessments of the three main rating agencies:

In May 2025, the international rating agency S&P reiterated Israel's credit rating at A, with a negative outlook (which remained without change too). This was mainly due to security risks. S&P noted that in 2025 the economy is expected to grow by 3.3%, but the government deficit will remain high due to an increase in defense spending.

In March 2025, the rating agency Fitch reiterated Israel's credit rating at A, with a negative outlook (also without change), addressing concerns regarding the government's political moves, which may "weaken checks and balances".

In March 2025, the rating agency Moody's reiterated Israel's Baa1 credit rating with a negative outlook, and published a special review of Israel's economic position, in which it expressed concern regarding the current situation, maintaining that "Israel's credit rating currently reflects very high political risks, which have weakened its economic strength".

Effect on the Financial Statements

Clal Insurance - In the Reporting Period, and as of the approval date of the Consolidated Interim Financial Statements no material changes occurred in connection with the effects of the War on Clal Insurance's financial results.

Max - in the Reporting Period, the growth trend in Max's issuance turnovers in Israel and overseas and in its acquiring turnovers continued; those turnovers exceeded turnovers in the corresponding period last year. This is further to the gradual growth in 2024, after the decline in the first months of the War. Looking ahead, it may be assumed that the deterioration in the security situation and the intensification of fighting in the south and in the north may affect businesses and residents, and consequently they may continue to affect economic activity, which is reflected in Max's business activities.

The estimated provision for credit losses is based on judgments and assessments and still involves substantial uncertainty at this stage. Further to Note 46(m) to the 2024 Consolidated Financial Statements, in 2023 Max increased the provision for current expected credit losses based on estimates of the potential increase in the credit risk of Max's customers. So far, and during the Reporting Period, there has not been a noticeable increase in the credit risk or actual credit losses of Max's customers due to the War. However, in light of the difficulty of estimating the duration and scope of the War and its potential effect on economic activity across the country, as well as the extent of the potential damage to the repayment capacity of Max's private and business customers, on the one hand, and the mitigating effects of aid programs and other reliefs, on the other hand, the estimated provision for credit losses is based on judgment and assessments and involves significant uncertainty at this stage. Accordingly, it is highly likely that future credit losses may be substantially higher or lower than the current estimate.

G. Share-based payment

Further to Note 44 in the Annual Financial Statements, on May 8, 2025, the Company's board of directors resolved to publish an outline for the allocation of up to 130,000 Class A options and 470,000 Class B options to be offered under the outline, based on the Plan for 2021, for employees and officers of the Company and/or companies under its control. Allocation of the options to be offered under the outline is subject to obtaining all of the permits and approvals required under any law for the offering of securities in accordance with the outline, for their issue, and for the publication of the outline. The shares underlying the exercise of these options will represent approx. 0.27% of the Company's equity capital as of the reporting date, assuming maximum exercise. The options will be exercisable for ordinary shares of the Company at the value of the benefit implicit in the options, subject to adjustments. The value of the benefit is based on the valuation of the options at the time they are allotted, which is approx. NIS 30.08 per option, and the fair value of each tranche will be spread over the vesting period. The value of the benefit was calculated using the binomial model and estimated at approx. NIS 15 million for all options, which will be awarded to Group officers and employees as stated above. The Class A options will be allocated in three tranches, spread over three years, and shall be exercisable beginning when one year, two years, and 3 years have elapsed from the allocation date, up to two years from the vesting/ holding date. (With respect to the first tranche, at least two years of vesting and holding are required).

The subsidiaries will bear the expense for the value of the options and will indemnify the Company in full for this benefit, based on the value of the financial benefit that will be recorded in the Company's financial statements and in accordance with the accounting principles.

2.2 Financial Information by Area of Activity (for details regarding the operating segments, see Note 4 to the Consolidated Interim Financial Statements).

In the Reporting Period, Clal Insurance presents an increase in assets under management and in sales in all products, other than life insurance investment contracts, which were affected by the market situation.

Total assets under management by provident funds, excluding guaranteed return provident fund tracks and pension funds, are not included in the Company's Consolidated Financial Statements.

Following are the main changes in comprehensive income compared to prior periods:

The following is a breakdown of key comprehensive income components:

In NIS million	Q1/2025	Q1/2024	Aggregate for 2024
Life Insurance	78		67	198
P&C insurance	64		30	402
Credit Insurance		7	8	37
Health Insurance	85		80	424
Pension	15		12	46
Provident		3	5	4
Total underwriting income from Insurance and Savings	252	203		1,111
Credit Cards	118		93	390
Agencies and Other	14		10	53
Total income from activities	384	306		1,554
Adjusted net financial margin	232	219		846
Not attributed to operating segments	(94)	(70)		(360)
Core income	522	454		2,041
Remaining financial margin	83		27	245
Adjustments		-	-	-
Total other income	83		27	245
Comprehensive income, before tax	605	480		2,286
Taxes	(195)	(164)		(740)
Comprehensive income, after tax	410	316		1,546
Comprehensive income, after tax for the shareholders	409	314		1,540
Return on equity, annualized, in %*	18.7	17.3		21.2
Balance of future contractual service margin (CSM) - retention - at the beginning of the period	10,148	8,813		8,813
Balance of future contractual service margin (CSM) - retention - at the end of the period	10,312	8,801		10,148

*) The return on equity is calculated based on the net income for the period attributable to the Company's shareholders divided by the equity attributable to the Company's shareholders as of the beginning of the period.

A. The Company's results in the Reporting Period

The post-tax comprehensive income in the Reporting Period amounted to approx. NIS 409 million, compared with a comprehensive income of approx. NIS 314 million in the corresponding period last year.

Core income - the income includes underwriting income, income from savings management (investment contracts, pension and provident), credit cards, agencies and the Group's finance expenses. In addition, the comprehensive income includes an additional annual spread of 2.25% above the risk-free interest rate plus a weighted illiquidity premium with respect to the investment portfolio held against non-yield-dependent insurance liabilities excluding the Hetz bonds component, and nominal risk-free interest plus an annual spread of 2.25% with respect to the investment portfolio held against the Company's capital and financial liabilities (hereinafter - the "Assumed Return").

Remaining financial margin – includes the financial effects, including changes in the risk-free interest rate curve and finance expenses with respect to insurance liabilities with respect to the passage of time beyond the Assumed Yield.

Core income in the Reporting Period amounted to approx. NIS 522 million, compared with a comprehensive income of approx. NIS 454 million in the corresponding period last year.

The improvement in income arises from an increase in underwriting income, mainly in the Property and Casualty Insurance and Health Insurance Segments and from an increase in income from the Credit Card

Activity.

Insurance and savings

Total underwriting income from insurance and savings totaled approx. NIS 252 million in the Reporting Period, compared to an income of approx. NIS 203 million in the corresponding period last year, mainly due to improvement in underwriting income in all insurance segments.

In the Reporting Period, there was an increase in contributions towards benefits provided by the Pension Subsegment and proceeds from investment contracts, such that the total gross premiums, contributions towards benefits and proceeds from investment contracts amounted to approx. NIS 6.9 billion, compared with approx. NIS 6.7 billion in the corresponding period last year - an increase of approx. 3%.

Credit cards and other

The total income from credit cards in the Reporting Period amounted to approx. NIS 118 million before tax compared to approx. NIS 93 million in the corresponding period last year.

Max's revenues in this period amounted to approx. NIS 586 million compared to approx. NIS 515 million in the corresponding period last year due to the increase in turnovers in Israel and overseas.

Max's net interest revenue increased and amounted to approx. NIS 204 million compared to approx. NIS 190 million in the corresponding period last year, mostly due to the increase in Max's business credit activity, due to the increase in the consumer and business credit portfolio, which is supported by informed risk management, which is required in view of the macroeconomic environment and the uncertainty as to the effects of the War.

Credit loss expenses amounted to approx. NIS 46 million, compared with an expense of approx. NIS 41 million in the corresponding period last year.

The increase in credit loss expenses is due to a more significant increase in credit balances in the first quarter of 2025 compared to the corresponding period last year. In addition, in the corresponding period last year, the credit loss provision was reduced, due to an improvement of the risk indicators.

Max's operating expenses in the first nine months totaled NIS 233 million, compared to NIS 208 million in the corresponding period last year, mainly due to an increase in expenses affected by the scope of the Company's business activities, such as fees and commissions to international organizations.

Revenue from investment and capital markets:

In the Reporting Period, income was recorded due to a decrease in insurance liabilities following an increase in the risk-free interest rate compared to a decrease in the corresponding period last year, which was offset by lower yields in the capital markets compared to last year, which affected the yields achieved by the Company, such that the balance of financial margin recorded was approx. NIS 83 million compared to approx. NIS 27 million last year.

Tax expenses

In the corresponding period last year, an amendment was approved by the Knesset plenum to the Value Added Tax Ordinance (Tax Rate for Non-Profit Organizations and Financial Institutions), 2024 (hereinafter the "Ordinance"), which prescribes that as from January 1, 2025 the rate of payroll tax applicable to financial institutions will stand at 18% of the wage paid for work, and the profit tax shall stand at 18% of the profit generated.

The deferred tax balances included in the Financial Statements as of Group's financial institutions March 31, 2024 have been updated so as to take into account the effects, which arise from the increase in tax rates as described above.

In addition, the effective rate of Max's tax provision in the period ended March 31, 2024 stood at 34.8%, compared to 27.5% in the corresponding period. The increase in the effective tax rate arose from one-off tax expenses arising from the closing of income tax assessments in respect of previous years.

The total said effects caused an increase of approx. NIS 18 million one-off in tax expenses in the corresponding period last year.

Return on equity

The return on equity in annualized terms during the Reporting Period was a positive 18.7%, compared with 17.3% in the corresponding period last year.

Premiums, contributions towards benefits and assets under management

During the Reporting Period, there was an increase in revenue from management fees for pension. For further details, see Section 2.2.1.3 and 2.2.1.4 below.

The Group's assets under management totaled approx. NIS 373 billion as of March 31, 2025, which is similar to December 31, 2024.

Out of the total said assets, as of March 31, 2025 approx. NIS 157 billion in assets are under management of the new pension fund compared to approx. NIS 155 billion on December 31, 2024.

2.2.1 Long-term savings

2.2.1.1. Life Insurance Subsegment including investment contract

	1-3
		2025 2024
Income from insurance services and activity	78	67
Effect of the change in the interest rate curve on the liabilities		120 (116)
Balance of financial margin	9	209
Comprehensive income	207	160
The redemption rate of the life insurance policies out of average savings in annualized terms		1.9% 1.6%

Income from insurance services and activity:

The increase in income from insurance services arises mainly from the increase in the release of the contractual service margin due to revision of actuarial assumptions, mainly regarding the application of a stochastic model as explained in Section 2.4(a)4 below.

Financial effects:

The increase in comprehensive income during the Reporting Period was affected by a decrease in insurance liabilities due to an increase in the risk-free interest rate compared to a decrease in the corresponding period last year, which was offset by a decrease in investment revenue compared to the corresponding period last year due to capital markets returns.

Investment income credited to policyholders in participating policies - following are details regarding the estimated amount of investment income credited to policyholders in life insurance and participating investment contracts calculated based on the return and balances of the insurance reserves in Clal Insurance's business reports (in NIS million):

	1-3
In NIS million	2025	2024
Investment gains (losses) carried to policyholders, net of management fees	(15)	3,373

2.2.1.2 Data regarding premiums earned, management fees and financial margin in life insurance:

	1-3		For the year
In NIS million	2025	2024	2024
Variable management fees*)	-	-	2
Fixed management fees	146	149	597
Total management fees	146	149	599
Current premiums	1,033	1,123	4,364
One-off premiums	91	72	297
Total premiums, gross	1,124	1,195	4,661
Current premiums	84	99	376
One-off premiums	329	175	955
Total premiums from investment contracts	413	274	1,331

*) As of March 31, 2025, the liability to policyholders in respect of negative returns on the portfolio of participating policies amounts to approx. NIS 0.13 billion.

The decrease in premiums during the Reporting Period arises from further cancellations and a decline in new business's sales.

Details regarding the rates of return on participating policies

	Policies issued in			Policies issued from 2004 and thereafter (the new Fund J)
	1992-2003 (Fund J)
	For the			For the
	1-3		year	1-3		year
In NIS million	2025	2024	2024		2025 2024	2024
Real return before payment of management fees	(0.05)	4.13	8.92	(0.08)	4.14	8.47
Real return after payment of management fees	(0.20)	3.98	8.27	(0.31)	3.91	7.48
Nominal return before payment of management fees	0.23	4.43	12.65	0.21	4.44	12.19
Nominal return after payment of management fees	0.08	4.27	11.98	(0.02)	4.20	11.16

2.2.1.3 Provident Subsegment

	1-3
In NIS million	2025	2024
Comprehensive income	3	5
Contributions towards benefits	1,118	1,127

The Reporting Period - the decrease in comprehensive income in the Reporting Period arises mainly from an increase in costs in respect of agent fees and commissions and a decrease in revenues from the management company's nostro portfolio due to the negative returns recorded in the capital markets in the current period compared to the previous period last year.

Contributions towards benefits - provident

2.2.1.4 Pension Subsegment

		1-3
In NIS million	2025	2024
Comprehensive income	15	12
Contributions towards benefits	2,671	2,529

The Reporting Period - the increase in comprehensive income in the Reporting Period arises from an increase in revenue from management fees mainly from assets under management, which increased compared to the corresponding period last year. This increase was partially offset by an increase in costs in respect of agent fees and commissions due to the increase in activity. In addition, during the Reporting Period, investment revenue from the nostro portfolio declined due to the negative returns recorded in the capital markets in the current period compared to the corresponding period last year.

The increase in contributions towards benefits in the Reporting Period arises mainly from an increase in the new business and the amounts of contributions by active planholders in the pension funds.

Contributions towards benefits - pension

2.2.1.5 The rate of outgoing transfers from savings products out of the balances of assets under management has increased in recent periods due to competition levels in the market. For further details regarding the effect of various factors on the markets, see Section 3 below.

2.2.2 Property and casualty insurance - Following is a breakdown of the premiums and the comprehensive income

	1-3
P&C insurance	2025	2024
Gross premiums	1,072	1,129
Income from insurance services and activity:
Motor Property	33	3
Compulsory Motor Insurance	5	3
Credit Insurance	7	8
Other portfolios	26	24
Total income from insurance services and activity	71	38
Effect of the change in the interest rate curve on the liabilities	15	(7)
Balance of financial margin	9	69
Comprehensive income	94	100
CR rate in motor property*	90%	99%

*Calculated in accordance with the ratio between expenses from insurance services net of revenue from reinsurance and revenue from insurance services net of reinsurance expenses.

Gross premiums:

During the Reporting Period - the decrease in premiums arises mainly from the timing of executing special transactions in the engineering insurance portfolio and a decrease in motor property insurance, which was partially offset by an increase in compulsory motor insurance.

Comprehensive income:

In the Reporting Period - the change in comprehensive income arises from a substantial underwriting improvement mainly in the motor property portfolio and in the guarantee portfolio and from an increase in the risk-free interest rate compared to a decrease in the corresponding period last year. On the other hand, during the Reporting Period, investment revenue declined compared to the corresponding period last year due to capital markets returns.

2.2.3 Health insurance

	Q1
	2025	2024
Gross premiums	481	435
Income from insurance services and activity	85	80
Effect of the change in the interest rate curve on the liabilities	30	(85)
Balance of financial margin	(3)	64
Comprehensive income	113	60

Gross premiums:

In the Reporting Period - the increase in premiums arises mainly from an increase in the individual insurance activity and from the Travel Subsegment.

Comprehensive income:

Income from insurance services and activity:

The higher income from insurance services is mainly due to the increase in the release of the contractual service margin following revision of the actuarial assumptions and sales in 2024, which were offset from class actions.

Financial effects:

Comprehensive income increased in the Reporting Period as a result of a decrease in insurance liabilities due to an increase in the risk-free interest rate compared to a decrease in the corresponding period last year; on the other hand, this effect was partially offset in the Reporting Period due to a decrease in investment revenue compared to the corresponding period last year due to capital markets returns.

Information regarding investment income credited to holders of health insurance policies of the participating long-term care type:

	Q1
In NIS million	2025	2024
Investment income credited to policyholders	3	50

2.2.4. Credit cards

	1-3
	2025	2024
Total revenue from the Credit Cards Segment	621	547
Total pre-tax income	118	93
Credit card transactions (Max) (see also Section 2.2.4.1)
Revenues
Revenue from credit card transactions	374	322
Interest revenue, net	204	190
Other revenues	8	3
Total revenues	586	515
Expenses
Credit loss expenses	46	41
Operating expenses	233	208
Selling and marketing expenses (see Section 2.2.5 below)	117	104
General and administrative expenses (see Section 2.2.5 below)	20	19
Payments to banks	61	54
Total expenses	477	426
Pretax income	109	89
Technological activity (Milo)
Revenue from credit card transactions	35	32
Pretax income	9	4

Revenue from credit card transactions include issuer fees and commissions, service fees and commissions in respect of the activity of card holders, fees and commissions from transactions carried out abroad, acquiring fees and commissions and other revenue from merchants net of fees and commissions to other issuers. As described above, the Company's turnovers in Israel and overseas increased in the first quarter of 2025 compared to the corresponding period last year - an increase which led to an increase in Company's revenues from credit card transactions, both from issuance and from acquiring.

Net interest revenue of Max increased in the first quarter of 2025 compared to the corresponding periods last year, mostly due to an increase in business activity, using responsible and strict management, which is supported by informed risk management, which is required in view of the macroeconomic environment and the uncertainty as to the effects of the War.

The increase in credit loss expenses arises from a more substantial increase in credit balances in the first quarter of 2025 compared to the corresponding period last year. In addition, in the corresponding period last year, the credit loss provision was reduced, due to an improvement of the risk indicators.

Max's operating expenses for the Reporting Period and the quarter increased compared to the corresponding period last year, mainly due to an increase in expenses affected from the volume of the Company's business activities, such as fees and commissions to international organizations.

2.2.4.1 Data by areas of activity - Max

	1-3	1-3	Rate of change
	2025	2024
Total credit card transactions (Max)
Revenues	586	515	14%
Comprehensive income	109	89	22%
Of which - issuance activity
Revenue from credit card transactions	305	257	19%
Interest revenue	147	138	7%
Total revenues	460	398	16%
Operating, marketing and general and administrative expenses	302	269	12%
Credit loss expenses	48	38	26%
Payments to banks	61	54	13%
Total expenses	411	361	14%
Comprehensive income, before tax	49	37	32%
Of which - acquiring activity
Revenue from credit card transactions	69	65	8%
Interest revenue	57	52	6%
Total revenues	126	117	10%
Operating, marketing and general and administrative expenses	68	62	10%
Credit loss expenses	(2)	3	(167%)
Total expenses	66	65	10%
Comprehensive income, before tax	60	52	15%

2.3 Additional data regarding Max

2.3.1 Quantitative data regarding the credit card transactions

Definitions:

Valid cards valid issued cards, excluding blocked cards and prepaid cards.
Active cards valid cards with which at least one transaction was carried out during the last quarter.
Issuance turnover the turnover from transactions executed with all of the Company's cards, excluding cash withdrawals in Israel and net of cancelled transactions.
Bank cards cards issued jointly by the Company and banks to the banks' customers.
Non-bank cards cards issued by the Company to customers without cooperation with the banks, sometimes in collaboration with business entities such as organizations and loyalty programs.

Turnover of transactions in respect of valid credit cards (active and inactive) (in NIS million):

2.3.2 Key credit quality indicators

	For the three-month period ended March 31		For the year ended
	2025	2024	December 31, 2024
Banking cards	59,912	19,050	80,382
Non-banking cards	43,769	13,243	59,388
Total	103,681	32,293	139,770

	As of
Main credit quality indicators (in %)	March 31, 2025	December 31, 2024	March 31, 2024
Rate of balance of the provision for credit losses of outstanding receivables for credit card transactions	2.30%	2.24%	2.42%
Rate of non-accruing receivable balance of receivables for credit card transactions	1.20%	1.13%	1.21%
Rate of net write-offs of the average balance of receivables for credit card transactions	1.46%	1.43%	1.59%

2.4 Capital and capital requirements

A. Capital requirements in accordance with the application provisions of the Economic Solvency Regime in Clal Insurance (see Section 1 below)

The insurance companies in the Group are subject to the Provisions of the Solvency II-based Economic Solvency Regime in accordance with the provisions of the Circular "Amendment to the Consolidated Circular Concerning Implementation of a Solvency II-Based Economic Solvency Regime for Insurance Companies", which was published on October 14, 2020.

In accordance with the Consolidated Circular, the Economic Solvency Ratio Report in respect of the December 31 and June 30 data of each year shall be included in the first periodic report published after the calculation date.

On May 28, 2025, Clal Insurance approved and published its Economic Solvency Ratio Report as of December 31, 2024, which was posted on the Group's website at:

https://www.clalbit.co.il/aboutclalinsurance/financialstatementsandpressrelease/.

It is noted that the calculation of the economic solvency ratio is based on data and models which may differ from those used by Clal Insurance as part of financial reporting, and which are based, among other things, on forecasts and assumptions that rely mainly on past experience. Specifically, and as detailed in the Economic Solvency Regime Circular, the calculation of the economic solvency ratio is based, to a large extent, on the model used to calculate the embedded value. For further details regarding the capital requirements that apply to Group companies, see Note 17(f) to the Annual Financial Statements.

In accordance with the principles for calculating the Deduction during the Transitional Period in accordance with the application provisions of the Economic Solvency Regime, as of December 31, 2024, the Deduction was updated and stands at NIS 2,063 million.

For additional information, including a general description of the economic solvency regime, the general underlying principles of the regime, the calculation methodology of the economic balance sheet and of the solvency capital requirement, Provisions for the Transitional Period, general review of the directives of the Commissioner's Directives relating to the Economic Solvency Ratio Report, definitions of key terms, comments and clarifications, please also read Sections 1, 3.1, 4.1 and 5.1 to the Economic Solvency Ratio Report of Clal Insurance as of December 31, 2024.

The solvency ratio as of December 31, 2024 does not include the effect of the Company's business activity in the period subsequent to December 31, 2024 and through this report's approval date.

For details of additional events during and subsequent to the Reporting Period, see Note 2.1 above.

The calculation made by the Company as of December 31, 2024 was audited by the independent auditors. The audit held in accordance International Standard on Assurance Engagement (ISAE) 3400 – "The Examination of Prospective Financial Information".

Following are data regarding Clal Insurance's solvency ratio and minimum capital requirement (MCR) according to the Solvency II regime.

	As of	As of
	December 31	December 31
	2024	2023
In NIS million	Audited	Audited
Shareholders equity for SCR	14,706	14,019
Solvency capital requirement (SCR)	9,624	8,976
Surplus	5,082	5,043
Economic solvency ratio (in %)	153%	156%
Effect of material equity transactions taken in the period between the calculation date and the publication date of the Company's Economic Solvency Ratio Report
Capital instruments raising (repayment)	500	460
Deviation from quantitative limitation	-	(169)
Shareholders equity for SCR	15,206	14,311
Surplus	5,582	5,335
Economic solvency ratio (in %)	158%	159%

1. Economic solvency ratio

For details regarding the solvency ratio without applying the Provisions for the Transitional Period and regarding the target solvency ratio and restrictions applicable to the Company in connection with dividend distribution, see Subsection 3 below.

For events during the Reporting Period and subsequent to the report date, and their potential effect on the solvency ratio, see Section 2.1 and 2.2 above.

2. Minimum capital requirement (MCR)

	As of December 31	As of December 31
	2024	2023
In NIS million	Audited	Audited
Minimum capital requirement (MCR)	2,406	2,244
Shareholders equity for MCR	10,975	10,272

3. Solvency ratio without applying the Provisions for the Transitional Period

According to the letter published by the Authority, in October 2017, (hereinafter - the "Letter") an insurance company shall be entitled to distribute a dividend only if, following the distribution, the company has a solvency ratio - according to the Economic Solvency Regime - of at least 100%, calculated without taking into account the Provisions for the Transitional Period and subject to the solvency ratio target set by the insurance company's Board of Directors. The aforesaid ratio shall be calculated without the relief granted in respect of the original difference attributable to the acquisition of the provident funds and management companies. In addition, the letter set out provisions for reporting to the Commissioner.

The following are data on Clal Insurance's economic solvency ratio, calculated without taking into account the Provisions for the Transitional Period.

Solvency ratio without applying the Provisions for the

Transitional Period		As of December 31 As of December 31
	2024	2023
In NIS million	Audited	Audited
Shareholders equity for SCR	13,284	11,268
Solvency capital requirement (SCR)	10,341	10,383
Surplus	2,943	885
Economic solvency ratio - in %	128%	109%
Effect of material equity transactions taken in the period between the calculation date and the publication date of the Company's Economic Solvency Ratio Report
Raising of capital instruments	500	460
Deviation from quantitative limitation	(500)	(460)
Shareholders equity for SCR	13,284	11,268
Surplus	2,943	885
Economic solvency ratio - in %	128%	109%
The surplus capital in view of equity transactions made in the period between the calculation date and the publication date of the Economic Solvency Ratio Report, relative to the Board of Directors' target (see Section B below):
The Board of Directors' economic solvency ratio target (%)	115%	110%
Capital surplus (shortfall) in relation to the target	1,392	(153)

4. Update regarding the stochastic model when calculating the economic solvency ratio of Clal Insurance

According to the economic solvency regime, the insurance liabilities were calculated in accordance with the Provisions of the Economic Solvency Regime, which in general, in relation to SLT life and health insurance, is calculated in accordance with the EV calculation practice in Israel. The determination of the best estimate should be based on an estimation of the distribution of the potential best estimates ("Stochastic Models"), and in the absence of significant statistical data that will allow the assessment of the distribution probability of the best estimate, the Company used the expected value of each relevant factor ("Deterministic Models").

In accordance with an outline issued by the Commissioner in November 2023, the Stochastic Model will not be implemented in the calculation of the solvency ratio without implementing the Provisions for the Transitional Period - over 3 reporting dates - but the Company will disclose its effects in the Economic Solvency Ratio Report. At this stage, the Company opted not to include this in the calculation that takes into consideration the Provisions for the Transitional Period.

In this report, the Company completed the stochastic calculation of the best estimate of the asymmetrical insurance liabilities cash flows (including carrying future variable management fees) based on an economic scenario generator,¹ including the implementation of tests and control

^[1.] As defined in the provisions of Appendix B, Section 5 (Part 2, Appendix 2) to the Provisions of the Economic Solvency Regime.

processes regarding the accuracy, robustness, and market consistency, as is the normal practice in foreign companies that implement stochastic models in the calculation of their economic solvency ratio. The Stochastic Model is used to calculate the optimal actuarial estimate of asymmetric insurance liabilities (including recognition of future variable management fees). With the Stochastic Model, the return used as a basis for the calculation remains unchanged compared to the Deterministic Model. However, the calculation of cash flows in the Stochastic Model takes into account fluctuations in the returns of the relevant assets in accordance with their composition and characteristics, including the investment channels, duration, and exposure to index and foreign currency exchange rates and their effect on recognition of the variable management fees. In order to create the Stochastic Model, the Company selected economic models that match its asset classes. As part of the process of selecting and calibrating those economic models, the Company was supported by international consultancy firms. In addition, the independent auditors reviewed the calculation process and the internal control.

The effect of the model's application is estimated at an additional rate of approx. 15%, without taking into account the Transitional Provisions, and with an additional rate of approx. 9%, taking into account the Transitional Provisions.

5. Revision of the capital target in Clal Insurance and dividend distribution in the Company and in Clal Insurance

For details regarding the revision of the capital target in Clal Insurance and dividend distribution in the Company and in Clal Insurance, see Note 2.1 (a) and (b) above.

6. Own Risk and Solvency Assessment of the Company (ORSA)

In January 2022, a principles paper regarding the implementation of the Own Risk and Solvency Assessment of an Insurance Company (ORSA) as well as an amendment to the Provisions of the Consolidated Circular, Reporting to the Commissioner of Capital Market about Own Risk and Solvency Assessment of an Insurance Company (ORSA) were published.

According to the Letter of Principles, the Company is required to examine, at least once a year, and to file with the Commissioner, each year, a report outlining the interrelationships between the overall strategy and annual work plan and the Company's risk profile, risk management policy, overall exposure level and the adequacy of the buffer under various assumptions and scenarios. In doing so, the risk management policy, capital targets and the range of risk management applied by the Company should be examined and taken into account. Clal Insurance filed the report to the Commissioner in January 2024.

7. Debt raising by Clal Insurance Capital Raising Ltd. a subsidiary of Clal Insurance

Subsequent to the reporting date, in April 2025, Clal Capital Raising issued to the public Bonds (Series N) totaling NIS 500 million. For further details, see 2.1(d) above.

B. Capital requirements and capital adequacy in Max

1. Equity and capital adequacy

Max's reported equity capital amounted to NIS 2,140 million as of March 31, 2025, compared to NIS 2,061 million at the end of 2024 - an increase of approx. 4%, and compared to NIS 1,906 million on March 31, 2024 - an increase of approx. 12%. The equity capital as of the end of the first quarter of 2025 includes NIS 26 million in share capital, NIS 376 million in share premiums, a NIS 83 million capital reserve, NIS 9 million in accumulated other comprehensive loss, and NIS 1,664 million in retained earnings.

At the end of the first quarter of 2025, Common Equity Tier 1 capital amounted to NIS 2,142 million, compared to NIS 2,066 million as of December 31, 2024, and compared to NIS 1,910 million on March 31, 2024.

At the end of the first quarter of 2025, total capital amounted to NIS 2,608 million, compared to NIS 2,532 million as of December 31, 2024, and compared to NIS 2,347 million on March 31, 2024.

The capital adequacy ratios are calculated as the ratio of capital to the risk-weighted assets. The CET1 capital ratio is calculated as the ratio of CET1 capital to the risk-weighted assets. The total capital ratio is calculated as the ratio of total capital to the risk-weighted assets.

As of March 31, 2025, the CET1 capital ratio amounted to 10.3%, compared to 10.0% at the end of 2024, and 10.6% on March 31, 2024. As of March 31, 2025, total capital to risk-weighted components ratio amounted to 12.5%, compared to 12.3% at the end of 2024, and 13.1% on March 31, 2024.

The decrease in Max's capital ratios as of March 31, 2025 compared to March 31, 2024 arises mainly from growth in activity and risk-weighted assets, from the downgrading of the State of Israel's rating by S&P in April 2024, which led to an increase in risk-weighted assets in respect of some of the Company's exposures to Israeli banks, and from a dividend distribution totaling NIS 62 million in July 2024, which was partially offset by the increase in capital due to the net income recorded during the period.

In accordance with Proper Conduct of Banking Business Directive No. 203, "Measurement and Capital Adequacy - Credit Risk - the Standardized Approach", the weight of the risk of part of the Company's exposure to Israeli banks derives from Israel's credit rating. Since The Company uses ratings of the international credit rating agency Standard and Poor's (S&P), the downgrading of Israel's rating by this agency in April 2024 from -AA to +A led to an increase in the risk-weighted assets, which were recognized with respect to some of Max's exposures to the Israeli banks, which decreased The Company's capital ratios by approx. 0.3%. The further downgrade of Israel's credit rating to A by S&P at the beginning of October 2024 does not affect Max's capital ratios, and even a further one-notch downgrade by S&P to A- is also not expected to affect Max's capital ratios. It is only if S&P will further downgrade Israel's rating by two or more notches to BBB+ or lower that, in Max's opinion, one can expect approx. 0.3% decrease in its capital ratios based on data as of March 31, 2025. Max is not aware of an intention to affect such rating downgrade. The credit ratings assigned by other rating agencies do not affect Max's capital ratios.

On June 19, 2024, The Banking Supervision Department published a circular for revising Proper Conduct of Banking Business Directive No. 206 "Capital Measurement and Adequacy - Operational Risk", according to which on January 1, 2026 the existing directive will be replaced with a new directive, which adopts the revised directives of the Basel Committee regarding the calculation of capital requirements in respect of operational risk. The new directive redefines the business indicator components that serve as the basis for calculating the capital requirements in respect of the operational risk and sets marginal coefficients to be multiplied by the business indicator in accordance with the ranges of the business indicator. Furthermore, the new directive stipulates that the business indicator will be multiplied by an internal loss multiplier, which will be based on the banking corporation's historical operating losses. It was further stipulated that a banking corporation, whose business indicator is lower than NIS 5 billion, is not required to use loss data in its calculation of the capital requirements, and its internal loss multiplier will stand at 1; for all other banking corporations, the internal loss multiplier will stand also at 1 through December 31, 2028, and the Banking Supervision Department will publish - no later than 2028 - the method for applying the internal loss multiplier to their capital requirements.

Max's leverage ratio as of March 31, 2025 is 8.9%, compared to 8.7% at the end of 2024 and 8.9% as of March 31, 2024.

2. The Bank of Israel's capital adequacy targets

According to Proper Conduct of Banking Business Directive No. 472 "Merchant Acquirers and Acquiring Payment Card Transactions", an acquirer whose receivables balance in its latest Annual Financial Statements exceeds NIS 2 billion — the capital requirement will be calculated in accordance with Proper Conduct of Banking Business Directives Nos. 201-211 (Capital Adequacy and Measurement). It was also stipulated that despite that which is stated in Section 40 to Proper Conduct of Banking Business Directive No. 201, the Common Equity Tier 1 capital ratio shall not fall below 8%, and the total capital ratio shall not fall below 11.5%.

As from April 1, 2015, Max has been implementing Proper Conduct of Banking Business Directive No. 218 on leverage ratio (hereinafter - the "Directive"). Pursuant to the Directive, entities are required to have a consolidated leverage ratio of no less than 5%.

basis. According to the circular, against the background of a review conducted by the Banking Supervision Department to amend the directive and a review of the leverage ratio and its mix, the above relief was extended as a temporary order until June 30, 2026, provided that the leverage ratio does not fall below that as of December 31, 2025 or the minimum leverage ratio applicable to the banking corporation prior to the temporary order, whichever is lower.

3. Max's capital adequacy targets

Max's capital is designed to support all risks embodied in its activity as well as its multi-year business activity, including supporting its lines of business, expanding the activity and entering into new areas of activity and complement and supplement its operations.

Furthermore, Max analyzes its performance in a stress scenario and has targets it will wish to meet upon the materialization of a stress scenario.

Max's policy, which was approved by its Board of Directors is to maintain a capital adequacy ratio, which is higher than the minimum threshold that was set by the Bank of Israel, and which is greater from the capital requirements needed to cover the risks in accordance with the results of Max's Internal Capital Adequacy Assessment Process (ICAAP).

In accordance with Max's risk profile, on June 30, 2024 Max's Board of Directors approved Max's CET1 capital ratio internal target at 9.25% instead of 10% as was the case through that date. The revised internal target is 125 basis points (1.25 percentage points) higher than the minimum CET 1 capital ratio set by the Banking Supervision Department. Max intends to hold a safety buffer above the revised internal target. The internal target for total capital ratio has not changed and stands at 12%.

**4. Total capital adequacy to risk-weighted components ratio in Max: (*)**

Following is a breakdown of the risk-weighted assets and capital requirements in respect thereof:

	As of March 31		As of March 31		As of December 31
	2025		2024		2024
	(Unaudited)				(Audited)
	Risk		Risk		Risk
	weighted	Capital	weighted	Capital	weighted	Capital
In NIS million	assets	requirements	assets	requirements	assets	requirements
Credit risks - standardized approach
of banking corporations	1,236	142	649		75 1,217	140
of corporations	1,792	206	1,512	174	1,747	201
Retail to individuals	11,663	1,341	10,435	1,200	11,775	1,354
of small businesses	1,547	178	1,279	147	1,419	163
Other assets	1,059	122	951	109	1,048	121
Credit valuation adjustment (CVA)		‐	‐	‐	‐	1 ‐
Total credit risk	17,297	1,989	14,826	1,705	17,207	1,979
Market risk - standardized approach	124	14	128		15 55	6
Operational risk –
standardized approach	3,454	397	2,989	344	3,347	385
Total risk-weighted assets and
capital requirements	20,875	2,400	17,943	2,064	20,609	2,370
Capital base	2,608		2,347		2,532
Total capital ratio	12.5%		13.1%		12.3%
CET1 capital ratio	10.3%		10.6%		10.0%

* Calculated in accordance with Proper Conduct of Banking Business Directives Nos. 201-211 on "Capital Adequacy and Measurement", and Proper Conduct of Banking Business Directive No. 472 "Merchant Acquirers and Acquiring Payment Card Transactions", which came into effect on September 1, 2016.

5. Dividend distribution policy and actual dividend distribution by Max

The dividend distribution in Max is subject to the directives of the Banking Supervision Department, including compliance with capital adequacy restrictions under the Basel directives. A dividend distribution is allowed subject to the provisions of the Companies Law, 1999, which stipulates, among other things, that Max may make a distribution out of its earnings, provided that there are no reasonable concerns that the distribution will prevent Max from fulfilling its existing and future undertakings, when they fall due.

During 2024, certain restrictions on dividend distribution included in Max's financing agreements were lifted.

On June 30, 2024, Max's Board of Directors set, for the first time, a dividend distribution policy. According to the approved policy, as from 2024 Max will be able to distribute every year dividends at a total amount of up to 30% of Max's net income for the year, which preceded the distribution year, in accordance with its consolidated financial statements. It is clarified that by setting the policy Max does not undertake to distribute a dividend on a certain date or rate, any distribution shall be subject to the full discretion of Max's Board of Directors and require the individual approval of the Board of Directors of Max, subject, among other things, to compliance with all the restrictions applicable to Max under the law and under directives of the Banking Supervision Department.

Accordingly, in 2024, a NIS 62 million dividend was approved and distributed, which constitutes approx. 28% of Max's net income for 2023.

Both the set dividend distribution policy and the actual distribution, which was approved were carefully considered, while retaining high capital surpluses in relation to Max's capital targets, in accordance with the regulator's expectation that the capital planning will be assessed in a conservative and informed manner in view of the War and the uncertainty in the Israeli economy.

2.5. Analysis of Cash Flow Development, Sources of Financing and Liquidity

2.5.1.Cash flow for the Reporting Period

The consolidated cash flows provided by operating activities in the Reporting Period amounted to approx. NIS 792 million; most of the amount arises from realization of financial investments by the Insurance Company and from a tax refund. The consolidated cash flows used for investing activities totaled approx. NIS 487 million in the Reporting Period, mainly from a reduction in credit provided to card holders and merchants. The consolidated cash flows used in financing activities totaled approx. NIS 453 million in the Reporting Period and included mainly the repayment of credit from banking corporations. The Group's cash and cash-equivalent balances increased from a total of approx. NIS 7,069 million at the beginning of the Reporting Period to approx. NIS 6,833 million at the end of the Reporting Period.

2.5.2. Company's financing

2.5.2.1 The Company's sources of financing and liquidity

The Company attaches great importance to maintaining sufficient cash balances, in a manner that will allow it to repay its obligations, and support, where required, the capital needs of Clal Insurance, and liquidity needs in respect of the activity of other Group investees. Other funding sources include, among other things, dividend distributions from investees, and the option of selling stakes in investees, debt raising from the banking system and/or the public, utilization of credit facilities and capital raising.

It is clarified that some of the investees are subject to regulatory provisions regarding dividend distribution beyond the distribution limitations set out in the Companies Law, 1999, which stipulates, among other things, that the Company may make a distribution out of its earnings, provided that there are no reasonable concerns that the distribution will prevent the Company from fulfilling its existing and future undertakings when they fall due:

A. Clal Insurance - the dividends from Clal Insurance depend on the policy set by the Board of Directors of Clal Insurance, see Section 2.4.A above, including compliance with the solvency ratio target set by the Board of Directors, which is higher than the minimum target set by the Banking Supervision Department. The Company considers interest proceeds received from its holding in a Restricted Tier 1 capital instrument of Clal Insurance as a source of liquidity and classifies this holding as a financial investment.

B. Max - the dividend distribution in Max is subject to the directives of the Banking Supervision Department, including compliance with capital adequacy restrictions under the Basel directives. Dividend distribution is allowed subject to the provisions of the Companies Law, 1999. For details regarding the dividend distribution policy, see 2.4.B.5 above.

For further details regarding the restrictions on dividend distributions in Clal Insurance and Max, see Note 6 to the Consolidated Financial Statements.

Furthermore, the Company controls the following entities which are not subject to special Regulatory Restrictions pertaining to dividend distribution beyond those of the Companies Law:

A. Clal Agency Holdings the Company presents the net financial assets of Clal Agency Holdings within the net financial assets of Clal Agency Holdings.
B. Clal Finance as detailed in Note 9 to the Consolidated Annual Financial Statements, Clal Finance holds a 24.9% stake in Michlol Finance Ltd. Michlol Finance is a company whose share is listed on the Tel Aviv Stock Exchange; the market value of its shares, based on the share price on the Stock Exchange, is approx. NIS 133 million immediately prior to the reports publication date. Furthermore, Clal Finance has an option to purchase approx. further 7% of Michlol's shares.

This investment is presented among investment in investees based on equity value and was not included in the financial investments in this section.

As of the reporting date, the Group has three types of financial liabilities, subordinated notes issued to address Clal Insurance's capital needs, and balances used in Max's operating activities issued by the Company.

Following is a table providing a breakdown of the net financial debt (the table includes the following companies: the Company, CIMax Holdings Ltd., and Clal Agency Holdings (1998) Ltd. as stated above, and does not include Clal Insurance and Max, which are subject to Regulatory Restrictions in addition to the distribution restrictions set out in the Companies Law, 1999:

	As of March 31	As of December 31
NIS million	2025	2024
Financial assets
Cash and cash equivalents	39	37
Other financial investments, mainly money market fund and Israeli T-Bills by		142
the Company	118
Restricted Tier 1 capital instrument of Clal Insurance *)	478	493
Total assets	636	672
Less current maturities
Current financial liabilities	15	43
Financial assets less current maturities	621	629
Non-current financial liabilities
Non-current financial liabilities:
Bonds issued by the Company - liability component	1,524	1,522
Total liabilities	1,524	1,522
Net financial debt	903	892

*) The other financial investments include an investment in a Restricted Tier 1 capital instrument of Clal Insurance amounting to NIS 521 million (fair value as of March 31, 2025 is approx. NIS 478 million).

Unutilized credit facility**) 250 250

**) In June 2024, an Israeli banking corporation approved a credit facility to the Company totaling up to NIS 250 million for the purpose of providing it with another liquidity buffer, for one further year through June 2025. For further details see Note 26(j) to the Annual Financial Statements. As of the report date and its approval date, the abovementioned credit facility has not been utilized.

2.5.2.2 The Company's financing characteristics

A. In its capacity as a holding company, the Company assesses the value of its assets against its liabilities in the context of funding and liquidity; it also assesses whether it has liquid means that are reasonably accessible to allow it to conduct its activities.
B. The Company's activity (investments, general and administrative expenses, debt service and dividends) is normally funded by dividends it receives, from investees, capital raising, loans from banking

corporations and proceeds from disposal of assets.

C. For details regarding key financial movements in the Company (on a separate basis), see the data on cash flow attributable to the Company itself (on a separate basis).
D. For details regarding the Company's distributable profits, adjusted to reflect the Company's capital requirements, and regarding capital and capital requirements in the consolidated institutional entities and other Group companies, see Note 17 to the Annual Financial Statements.

2.5.2.3 Dedicated disclosure for the Company's bond holders

A. Bonds' data

	Bonds	Bonds (Series	Bonds (Series A) (second	Bonds (Series B)
Series / issuance date	(Series A)	A) (expansion)	expansion)	(convertible bonds)	Bonds (Series C)
Issuance date	February 2023	June 2023	August 2023	February 2023	December 2023
Par value on issuance date (in NIS)	249,100,000	250,000,000	400,000,000	150,000,000	500,000,000
Par value as of March 31, 2025 (in NIS)	249,100,000	250,000,000	400,000,000	149,989,800	500,000,000
Carrying amount as of March 31, 2025 (in NIS)	Approx. NIS 248 million	Approx. NIS 244 million	Approx. NIS 394 million	Approx. NIS 142 million **)	Approx. NIS 496 million
Market value as of March 31, 2025 *)	Approx. NIS 249 million	Approx. NIS 250 million	Approx. NIS 400 million	Approx. NIS 163 million	Approx. NIS 516 million
Interest type	Fixed, non-linked			Fixed, non-linked	Fixed, non-linked
Nominal interest rate	4.7%			2.8%	5.25%
Interest payable as of March 31, 2025	Approx. NIS 1 million	Approx. NIS 1 million	Approx. NIS 2 million	Approx. NIS 1 million	Approx. NIS 11 million
Effective interest rate on issuance date	4.9%	5.6%	5.3%	4.9%	5.5%
Listed on the TASE	Yes		Yes	Yes
Principal payment dates	February 28, 2028			February 28, 2028	The principal shall be repaid in three installments in each of the years 2029-2031
Interest payment dates	The interest shall be paid in a single annual installment on February 28 of each of the years 2024-2028			The interest shall be paid in a single annual installment on February 28 of each of the years 2024-2028	The interest will be paid in two semi-annual installments, on November 1 and May 1 of each of the years 2024-2031
Are the notes convertible	No		Yes	No
Linkage base and terms	Notes (principal and interest) are not linked to the CPI and/or to any currency		Notes (principal and interest) are not linked to the CPI and/or to any currency	Notes (principal and interest) are not linked to the CPI and/or to any currency
Pledged assets	None		None	None
Company's right to execute early redemption or forced conversion	The Company may execute full or partial early redemption of its notes no more than once a quarter. Payment to note holders in respect of early redemption shall amount to the higher of: A. Market value; B. Outstanding par value; C. Balance of cash flow (principal and interest) discounted using the return on government bonds plus a 1% interest.		The Company may execute full early redemption of its notes starting 30 days from their listing on the stock exchange, and no later than 180 after such a listing. The payment to note holders in respect of early redemption shall be the outstanding par value of the notes (principal and accrued interest) plus one-off early redemption fee of 2% of the outstanding par value. The Company does not have the right to execute a forced conversion of the notes.		The Company may execute full or partial early redemption of its notes no more than once a quarter. Payment to note holders in respect of early redemption shall amount to the higher of: A. Market value; B. Outstanding par value; C. Balance of cash flow (principal and interest) discounted using the return on government bonds plus a 1% interest.
Series' materiality	The series is material as this term is defined in Regulation 10(b)13(a) of the Securities Regulations (Periodic and Immediate Reports), 1970		The series is material as this term is defined in Regulation 10(b)13(a) of the Securities Regulations (Periodic and Immediate Reports), 1970	The series is material as this term is defined in Regulation 10(b)13(a) of the Securities Regulations (Periodic and Immediate Reports), 1970
A cross-default clause is in place ***)		Yes		Yes	Yes

*) The market value includes interest accrued as of March 31, 2025.

**) Of which approx. NIS 13 million represents the equity component presented under equity.

***) For further details, see Section 8.1.14 to the deeds of trust of Bonds (Series A) and (Series B) that were attached to the shelf offering report of February 9, 2023.

Criterion	Bonds (Series B) (convertible bonds)
Details of the security	The bonds are convertible into ordinary shares of the Company
into which the bonds
may be converted
Conversion ratio	At the issuance date, the conversion ratio was as follows: Every NIS 85 p.v. of the
	bonds will be convertible into one ordinary share of the Company
	In December 2024, subsequent to the Company's dividend distribution, the
	conversion ratio changed such that every NIS 83.73 p.v. of bonds would be
	convertible into one ordinary Company share.
Key terms of conversion,	The bonds are convertible on each day on which trading takes place on the Stock
including conditions	Exchange through February 18, 2028;
precedent for the	If during the conversion right period the Company will distribute bonus shares and/or
execution of a	dividend and/or offer shares by way of offering rights, the number of shares arising
conversion and any	from the conversion will be adjusted. For further details, see Section 6.3.3 to the
distribution adjustments	deed of trust attached to the shelf offering report of February 9, 2023.

B. Details regarding the conversion component in Bonds (Series B)

C. Details regarding rating

	Bonds	Bonds (Series B)
	(Series A)	(convertible bonds)	Bonds (Series C)
Rating agency	Maalot	Maalot	Maalot
Rating on issuance date	ILAA-	ILAA-	ILAA
Current rating	ILAA-	ILAA-	ILAA

The trustee for the Notes (Series A, Series B and Series C) is Hermetic Trust (1975) Ltd. The names of the individuals in charge of the notes are Adv. Dan Avnon and/or Adv. Meirav Ofer, Tel: 073- 2171000, Fax: 03-5271451, email: [email protected], postal address: Champion Tower, 13th Floor, 30 Derech Sheshet HaYamim, Bnei Brak.

D. Contractual restrictions and financial covenants

As part of the trust deed of the Bonds (Series A, Series B and Series C), Max undertook not to place a floating charge on all of its assets as long as the Bonds (Series A, Series B and Series C) are not repaid in full, unless it has obtained the bond holders' consent in advance or placed a floating charge of the same rank in favor of the bond holders. Furthermore, with respect to the expansion of the Bonds (Series A, Series B and Series C), the Company assumed restrictions on dividend distribution; it also undertook to comply with financial covenants whereby its shareholders' equity will not fall below NIS 3.2 billion (as part of Series A and Series B) or NIS 3.4 billion (as part of Series C), and its net financial debt to total assets ratio will not exceed 50%.

For further details, see Section 6.3.1 to the deeds of trust of Bonds (Series A) and (Series B) that were attached to the shelf offering report of February 9, 2023 and Section 6.3.1 to the Trust Deed (Series C) attached to the shelf offering report dated December 4, 2023.

In addition, an adjustment mechanism was set whereby the interest rate will increase as a result of failure to comply with any of the financial covenants.

The financial covenants will be adjusted if - as a result of the first-time application of accounting standards - they will undergo a change, whose effect is not negligible. For further details, see Section 6.3 to the deeds of trust of Bonds (Series A) and (Series B) that were attached to the shelf offering report of February 9, 2023 and Section 6.3 to the Trust Deed (Series C) attached to the shelf offering report dated December 4, 2023.

An adjustment mechanism was also set whereby the interest rate will increase if the Company's rating will be downgraded. For further details, see Section 6.4 to the deeds of trust of Bonds (Series A) and (Series B) that were attached to the shelf offering report of February 9, 2023 and Section 6.4 to the Trust Deed (Series C) attached to the shelf offering report dated December 4, 2023.

As of the reporting date, the Company complies with the covenants described above. As of March 31, 2025, the net financial debt ratio is approx. 8%, and shareholders' equity amounts to approx. NIS 9.2 billion.In addition, as of the reporting date and the publication date of this report, and during

the period starting on the notes' issuance date, the Company has complied and continues to comply with all the conditions and undertakings as per the deeds of trusts, and no circumstances have arisen which establish grounds for immediate repayment of the notes. Furthermore, the Company did not receive notice from the trustee for the notes regarding its failure to comply with the conditions and undertakings as per the deeds of trusts.

The key points of the deeds of trust of Bonds (Series A and Series B), that were signed between the Company and the trustee, are attached to the shelf offering report of February 9, 2023, and the key points of the trust deed of Bonds (Series C) are attached to the shelf offering report of December 4, 2023, and the full texts of the deeds of trust are available for perusal by appointment at the Company's registered office on any business day during normal working hours.

3. Developments and Material Changes in the Macroeconomic Environment in the Reporting Period

3.1 Key economic data

*Forecast data in accordance with the Bank of Israel Research Department's forecast, April 2025

Federal Reserve's interest , United States

* The December 2024 data represents the consensus of forecasts according to Bloomberg, May 7, 2025

3.2 Key trends and material changes in the macroeconomic environment in the Reporting Period and thereafter

As from October 7, 2023, Israel has been in a state of war; for further details, see Section 2.1(e) above.

Criterion	Data for the period
Development in the market and employment in Israel	In 2024, GDP grew by approx. 0.9%; in accordance with the macroeconomic forecast of the Bank of Israel's Research Department (April 2025), GDP is expected to grow by 3.5% in 2025 and by 4% in 2026.
	As of March 2025, the budget deficit amounted to 5.2% of GDP, compared to 5.3% of GDP in February 2025. In accordance with the Bank of Israel's forecast, the government budget deficit in 2025 and 2026 is expected to amount to 4.2% of GDP and 2.9% of GDP, with the debt to GDP ratio expected to increase to 69% of GDP in 2025, and 68% of GDP in 2026.
	The labor market - upon the outbreak of the War, the broad unemployment rate (a data which includes - in addition to those unemployed - also those who are temporarily absent due to economic reasons, such as expense for unpaid leave) increased sharply from 4.2% to 9.7% in October 2023; however since then the broad unemployment rate declined to 3.9% in March 2025. In accordance with the Bank of Israel's forecast, the broad unemployment rate is expected to stand at approx. 2.9% at the end of 2025 and 3.2% in 2026.
	According to the Central Bureau of Statistics' estimates for February 2025, the average wage of a salaried employee continues to rise and has risen by 2% compared to February 2024. The average wage for a salaried employee in current PPPs was NIS 13,773.
	The housing market - house prices increased by 7.5% in the past twelve months.
	In May 2025, the international rating agency S&P reiterated Israel's credit rating at A, with a negative outlook (which remained without change too). The negative outlook reflects the risk that the conflict between Israel, Hamas and other proxies supported by Iran may substantially weaken the Israeli economy, its fiscal position and the balance of payments, especially if the conflict will deteriorate. The agency notes that despite Israel's healthy macroeconomic fundamentals, including its diverse and adaptive economy, a prolonged or more intensive military conflict may have an adverse effect on economic and fiscal performance and on the balance of payments.
Inflation data	In the first quarter inflation increased by 1.1%; in the past year inflation increased by 3.3%.
Foreign exchange rates	Since the beginning of the year, the shekel has devalued by approx. 2% against the USD.
Development in interest rates and returns	In January 2024, the Monetary Committee decided to cut the interest rate by 0.25 percentage point to 4.5%. In its subsequent meetings, the Monetary Committee decided to leave the interest rate without change.

In %	1-3	For the year
Share indices in Israel	2025	2024	2024
TA 35	1.0	7.8	28.4
TA 90	(0.6)	10.9	30.9
TA 125	0.8	8.3	28.6
TA Growth	(0.2)	16.7	37.3
Bond indices in Israel
General	0.4	0.6	4.9
Tel Bond-CPI Linked	0.4	1.7	6.4
Tel Bond-Shekel	0.4	1.1	6.1
CPI-Linked Government Bonds	(0.6)	(0.5)	2.3
Government - NIS	0.9	(0.5)	3.0
Share indices across the world
Dow Jones	(1.9)	5.6	12.7
NASDAQ	(11.5)	9.1	28.7
Nikkei Tokyo	(10.7)	20.6	19.2
CAC Paris	5.6	8.8	(2.2)
FTSE London	5.0	2.8	5.7
DAX Frankfurt	11.3	10.4	18.8
MSCI AC	(1.3)	8.5	17.5
S&P 500	(5.5)	10.2	23.2

Developments in capital markets in Israel and across the world (in terms of local currency)

For details regarding the effects on the financial results, see Section 2 above and Note 5 to the Financial Statements.

Global economic developments The first quarter of 2025 was characterized by uncertainty in the markets and in the global economy; it was expected that uncertainty will decline after the imposition of tariffs on various countries across the world by the United States, but, in fact, the result was quite the opposite, and there are concerns that a trade war will break out due to the imposition of counter-tariffs on the part of various countries (mainly China). Inflation continued to subside across the world and the labor market remained stable, but there are still concerns that inflation will rear its head due to the "tariff war". The geopolitical events, which the world saw in 2024 continue into 2025: The war between Russia and Ukraine, the war in the Middle East and political upheavals in major countries across the world.

United States – at the beginning of 2025 the economy was plunged into a trade war when the US imposed tariffs on a large number of countries, some of which (mainly China and Europe) responded with countermeasures such as retaliatory tariffs. Inflation continued to subside and stands at 2.4% (compared to 2.9% at the beginning of the year) - still above the central bank's target and amid concerns regarding an increase in inflation due to the tariffs. Market estimates are that interest rates will be cut 3 times during 2025. The US economy grew by 2.5% in the fourth quarter of 2024 and by 2.8% throughout 2024, in annual terms. It is noted that the unemployment rate is still low and stands at 4.2%.

Europe – after interest rate cuts in 2024 due to the subsidence of inflation, in the first quarter of 2025 the European Central Bank cut its interest rate twice to 2.65% (compared to 3.15% at the beginning of the year) and the inflation rate slowed to 2.2%, as of March. The European economy still grew at a slow rate of 0.2% in the fourth quarter and by 0.9% throughout 2024, in annual terms. The unemployment rate remained similar and stands at 6.1%.

China – the country was at the center of the trade war declared by President Trump, who initially imposed a 34% tariff on China (in addition to the existing 20%). China responded by raising it tariffs on US imports and, the US, in turn, retaliated by raising tariffs on Chinese imports to up to 145%. The United States and China are effectively in a reciprocal tariff war, which includes additional restrictions on the export of advanced semiconductors, which places a strain on China's economy. The growth rate in the fourth quarter of 2025 stood at 1.2% and at 5% throughout 2024 despite fiscal and monetary incentives.

4. Restrictions on and supervision of the corporation's business

In this chapter, we will review in a condensed form laws, regulations, circulars and very material position papers, or drafts of laws, regulations, circulars and very material position papers, that apply to the activity of the Group's institutional entities, and which are material to the Group's activity, as published by the Knesset, the government or the Commissioner of the Capital Market, Insurance and Savings, as the case may be, subsequent to the publication date of the Annual Financial Statements.

We will also review - in a condensed form - laws, regulations, Proper Conduct of Banking Business Directives (hereinafter - "PCBBD") and very material position papers, or drafts of laws, regulations, PCBBD and very material position papers, that apply to the activities of issuance, acquiring and processing of payment cards and credit to private individuals and businesses (hereinafter - "Max's Activity"), and which are material to the Group's activity, as published by the Knesset, the government or the Banking Supervision Department, as the case may be, subsequent to the publication date of the Annual Financial Statements.

4.1 General

4.1.1 Corporate governance in public companies with no controlling shareholder

In April 2025, the Knesset's Constitution, Law and Justice Committee passed the second and third readings of the Companies Law Bill (Amendment No. 38), 2025. Among other things, the bill includes the following proposed amendments regarding a company without a controlling shareholder: Adding a rebuttable presumption whereby in a company, none of the shareholders of which has a stake of more than 50% of its means of control, a stake of 25% or more of the means of control will be deemed as control therein; the requirement to appoint external directors was replaced by the requirement to appoint a majority of independent directors in the Board and its committees; allowing companies to pay a Chairperson of the Board, who is an independent director, a compensation, which is higher than the compensation cap paid to an external director; regulating a procedure for nomination of candidates for service as directors by an independent Appointment Committee; regulating a procedure for approval of transactions with directors and a procedure for approval of extraordinary transactions with substantial shareholders, who hold 10% or more of a certain type of means of control.

The law will not come into force before July 2026, and its coming into force is conditional upon the regulations, which will be brought for approval by the Committee, and in any case, transitional provisions will apply to serving directors. To date, the Company is unable to assess the implications of the bill and the regulations which will be promulgated, to the extent that they are promulgated, and their effect, due to, among other things, the fact that strict provisions apply to the Company by virtue of its status as the controlling shareholder in an insurance company.

4.1.2 Interim report of the Taskforce for Assessing the Measures to Increase Retail Banking Competition in the Banking System

In March 2025, the Taskforce for Assessing the Measures to Increase Retail Banking Competition in the Banking System published its interim report, which examined measures to remove barriers to the entry of additional players into the banking system. The taskforce's main recommendations are:

Setting two licensing levels, while distinguishing between a small bank and a large bank in accordance with their assets under management and three regulatory levels for banks.
A small bank will be able to focus its activities on receiving deposits from the public and advancing credit from these deposits and will also be able to opt to offer certain additional services.
Provision of infant industry protections to a new small bank (such as an exemption from open banking requirements and switching of accounts for a limited period) and non-applicability of the Officer Salary Law for 10 years.
A holding permit will only be required in a small bank for ownership stakes higher than 10%.
Holding companies, which control institutional entities, will be allowed to control at the same time a bank which does not hold more than 2.5% of the total assets in the banking system; the said bank will not be allowed to engage in provision of advice regarding investment and savings instruments, and the supervision of holding companies will be regulated by legislation.
Extension and enhancement of protections provided and directives issued to the credit card companies, which process the issuance of bank cards, prescribed under the Law for Promoting Competition and Minimizing

Market Concentration, regarding the relationship between the banks and the abovementioned processing credit card companies.

In order to complete the work and formulate final recommendations, the interim report included a call for proposals, in which the taskforce sought the public's position regarding the recommendations listed in the report.

At this stage, it is impossible to assess the significance of the recommendations in the interim report. However, if the interim report will be published as a final report, and if the recommendations will be adopted as part of a legislation, such that additional entities will be able to obtain a bank license and/or holding companies, which control institutional entities, will be able to control a small bank, the competition in the financial and banking system may intensify and the market relevant to the Group's activity may undergo structural changes.

4.1.3 Draft of the Privacy Protection Authority's guidance regarding the applicability of the Privacy Protection Law to artificial intelligence systems

In April 2025, the Privacy Protection Authority's guidance was published as a draft for public comment, presenting the Authority's interpretation of the provisions of the Privacy Protection Law and the regulations promulgated thereunder for the purpose of exercising its powers regarding databases, which use artificial intelligence systems, including for the purpose of exercising the supervisory powers, powers regarding administrative inquiries, enforcement and imposition of sanctions conferred upon the Authority under Amendment No. 13 to the Privacy Protection Law, which is due to enter into force in August 2025 (hereinafter - the "Draft Guidance"). Under the Draft Guidance, the Authority clarified that the Privacy Protection Law applies to artificial intelligence systems, which store or actually process personal information, and clarified the appropriate application of the provisions of the law and its regulations to artificial intelligence systems.

4.2 Max's Activity

4.2.1 Payment Services Regulations (Exemption from the Provisions of the Law)

In March 2025, a draft of the Payment Services Regulations (Exemption from the Provisions of the Law) (Amendment), 2025, was published. In accordance with the draft amendment, gift vouchers/cards, which are not designated for a particular payer (unidentified), including digital cards, will continue to be excluded from certain provisions of the Payment Services Law, and new consumer provisions will be applied to such means of payment, such as: The requirement to document information regarding transactions and their dates, providing such information to the customer, termination of payments in the event of failure to supply a product/service on time. In addition, it is proposed to set an overall cap with respect to a single customer with a specific issuer, such that the maximum cumulative amount of digitally-issued unidentified means of payment will be NIS 5,000. In May 2025, the Economic Affairs Committee approved the Ministry of Justice's request to extend by two months the current arrangement under the regulations in their current wording.

At this preliminary stage, it is impossible to assess the effects of the abovementioned amendment on Max's activity.

4.2.2 E-banking

In April 2025, the Banking Supervision Department published a draft for public comment regarding E-banking policy. The draft requires a banking corporation to deliver to another banking corporation substantiated information, which can assist in assessing, identifying and preventing fraud in the other banking corporation. The requirement to deliver such information will apply to all fraud types, whether they are carried out through Ebanking or not, and whether they are instigated against the banking corporation itself or against the banking corporation's customer.

At this stage, given the fact that it is not yet clear which information banking corporations will be required to deliver and which information they will be able to receive, including in what manner such information will be delivered/received, how often, etc., Max is unable to assess the implications of the said draft.

5. Exposure to Market Risks and Management Thereof

In accordance with the Securities Regulations (Periodic and Immediate Reports), 1970, Disclosure on exposure to, and management of, market risks relates to exposures of the Company and its consolidated companies, except for Mivtachim in Israel and an acquirer.

Linkage bases report as of March 31, 2025

		Other non	Credit card	Israeli
		monetary	company in	insurance
GBP	Other	items	Israel	company	Total

‐ ‐		‐	‐	4,985 ‐	4,985
- ‐		‐	‐	649 1,088	1,848
‐ ‐		‐	‐	86,330 ‐	86,330
‐ ‐		‐	53	1 41,547	41,675

‐ ‐		‐	‐	‐ 2,328	2,328
‐ ‐		‐	17,852 ‐		17,852 ‐
‐ ‐		‐	6	56 1,425	1,553
‐ ‐		‐	‐	13	18 ‐
‐ ‐		‐	‐	‐ 2,624	2,624
‐ ‐		‐	‐	2,609 ‐	2,609

‐ ‐		‐	135	‐	59 194
‐ ‐		‐	‐	3,944 ‐	3,944
‐ ‐		‐	‐	1,528 ‐	1,528
‐ ‐		‐	16	132	153 301
‐ ‐		‐	892	241 1,066	2,199
					Directors
‐ ‐		‐	5	‐	789 794
‐ ‐		‐	11	143	9 164
					382 666 of
					171,611 Board
‐ ‐ - ‐			‐ ‐	91 1,208	193 19,280 150,866

Report of the

Linkage bases report as of March 31, 2025 (cont.)

NIS			Foreign currency
	Non	CPI						Other non	Credit card	Israeli insurance
In NIS million	linked	linked	USD	EUR	GBP	Other		monetary items	company in Israel	company	Total
Liabilities
Loans and credit	1,535		‐	‐	‐	‐	‐	‐	6,496	5,840	13,870
Liabilities for derivative instruments	‐		‐	‐	‐	‐	‐	‐	‐	929	929
Payables and credit balances	108		‐	‐	‐	‐	‐	4	571	972	1,655
Payables for credit card transactions	‐		‐	‐	‐	‐	‐	‐	9,933	‐	9,933
Current tax liabilities	1		‐	‐	‐	‐	‐	‐	7	59	67
Liabilities for yield-dependent investment contracts	‐		‐	‐	‐	‐	‐	‐	‐	12,251	12,251
Liabilities for non-yield-dependent investment contracts	‐		‐	‐	‐	‐	‐	‐	‐	2,520	2,520
Liabilities for insurance contracts	‐		‐	‐	‐	‐	‐	‐	‐	119,870	119,870
Labilities for reinsurance contracts	‐		‐	‐	‐	‐	‐	‐	‐	62	62
Liabilities for employee benefits, net	18		‐	‐	‐	‐	‐	‐	26	46	90
Deferred tax liability	‐		‐	‐	‐	‐	‐	10	‐	353	363
Lease liabilities	‐	109		‐	‐	‐	‐	‐	192	470	770
Total liabilities	1,662	109		‐	‐	‐	‐	14	17,225	143,371	162,380
Total exposure	(1,434)	(94)		14	-	‐	‐	1,195	2,055	7,495	9,231

6. Risk Review for Max

For an extensive description of the effect of the Iron Swords War on Max's risks and how they are managed, see the Iron Swords War chapter at the beginning of Max's Report of the Board of Directors and Management. For an extensive description of Max's risks and their management, see Max's 2024 Financial Statements.

General description of the risks and their management

Max is engaged in a wide range of financial activities that involve the taking of risks, including: credit risk, market risk and liquidity risk. Those risks are accompanied by other risks, such as: operational risks, including information security and cyber risks, compliance risks and prohibition on money laundering, legal risk, strategic risk, reputational risk, ESG risks and model risk embodied in the business activities. Intelligent and in-depth risk management encompassing all areas of Max's activity is part of Max's strategy and a necessary condition for the fulfillment of its long-term goals.

Subsequent to the reporting date, on April 7, 2025, Max was listed as a reporting corporation on the Tel Aviv Stock Exchange and on April 24, 2025, Max completed for the first time a raising of commercial papers (CPs) from institutional investors and from the public. Max's becoming a reporting corporation allows it to diversify its sources of financing by adding the option of raising funds from the public.

For additional information about the risks, see Pillar 3 - Disclosure of Additional Information about Risks, which was posted on Max's website.

Credit risk

In accordance with Directive No. 311 regarding the management of credit risks, the risk is defined as a risk that a borrower or a counterparty of Max will fail to meet its obligations to Max, as they were agreed upon.

Credit risk management

In accordance with Directive No. 311, the objective of the management of credit risks is to maximize the return adjusted to Max's risk appetite, by ensuring that the exposure to credit risk is in line with Max's policy on this topic.

The credit policy

Max operates according to a credit policy, which is approved by the Board of Directors once a year, and which constitutes one of the main pillars through which Max's credit strategy and risk appetite are reflected. The credit risks policy stipulates, among other things, the principles for provision of credit, including guidelines for the marketing of retail and business credit, the methods of control and the management of the credit risks and restrictions on the provision of credit, in order to monitor and mitigate the credit risk in the portfolio in accordance with the risk appetite.

The credit policy serves as a framework for setting procedures for identifying, measuring, monitoring and placing controls on the credit risk, which is derived from Max's risk appetite.

As a leading company in its area of activity, Max developed a professional function that implements an informed and efficient risk management processes in its business activities in the field of credit, in accordance with the customers' needs.

The three lines of defense

First line of defense This responsibility of the first line of defense includes identifying, assessing, measuring, monitoring, mitigating, and reporting the risks embodied to the products, activities, processes, and systems for which they are responsible, and for managing a proper control environment in the risk management context. Among other things, the first line of defense checks compliance with internal and regulatory restrictions, monitors economic indicators, checks the powers of each function, and assesses the credit that was provided on a case by case basis.
Second line of defense the Credit Control Unit, headed by the Chief Risk Officer, is in charge, among other things, of setting the work methodology and challenging the first line of defense. Its roles include: formulating the risk appetite restrictions, formulating the credit policy, assessing the restrictions set in the policy, applying independent controls regarding the credit risk, including issuing opinions regarding high-amount credit requests, monitoring risk trends and risk centers, and delivering appropriate reports to Max's management and Board of Directors.
Third line of defense the internal audit function conducts an independent review and challenges the Company's risk management processes and systems, as well as various credit-related audits in accordance with the work plan.

In addition to Directive No. 311 that was referred to above, Max takes action to implement the relevant directives of the Banking Supervision Department, including Proper Conduct of Banking Business Directive No. 313 regarding the restrictions on the indebtedness of a borrower and a group of borrowers in order to reduce the concentration of risk of borrowers, Proper Conduct of Banking Business Directive No. 312 regarding the restrictions on liability of related parties, aimed at limiting the scope of liability of parties related to the Company and minimize the risks stemming from those transactions, and Proper Conduct of Banking Business Directive No. 450 regarding debt collection proceedings aimed at regulating the actions that should be taken in order to increase fairness and transparency when collecting debts from customers. In addition, Max also takes action and implements the provisions of Proper Conduct of Banking Business Directive No. 311A on consumer credit management.

Max operates in accordance with dedicated rules regarding the marketing and initiation of retail loans. Max has in place scenarios for conversations it initiates with customers, which include: Fair disclosure to the customer in accordance with the Banking Rules (Service to Customer, Fair Disclosure and Delivery of Documents), and they were written in accordance with its code of ethics, the principles for management of the conduct risks, and the guidelines in connection with the marketing of credit to customers, while providing full disclosure to the customer.

Credit risk for credit to private individuals

The credit risk in respect of credit to private individuals arises mainly from the exposure to current transactions involving credit cards and credit products.

Max offers a range of credit products to private individuals, as follows:

Non-interest-bearing credit a credit facility for making purchases using credit cards.
Interest-bearing credit composed of several products, mainly: Car finance loans ("car loans"), solo loans ("allpurpose loans") and revolving credit. Most of the credit is advanced at variable interest, but CPI-linked credit is also advanced at a fixed interest rate under the car financing activities.

Model-based underwriting

Most of the consumer credit that is advanced by Max, is provided through a model-based underwriting process, which is based on statistical credit scoring models, that include various scoring scales, and an additional score in case of default, in combination with business rules.

The decision regarding the amount of credit and the interest rate set for a customer is based on the model in combination with business rules, that constitute another method for assessing the risk level.

The models are based on internal and external information sources which may indicate negative developments in the customer's financial position, such as: payment default, exceeding credit limits, and warnings from external sources of information.

Max develops and improves the models for new and existing customers on an ongoing basis and as required, and also validates them independently on a periodic basis, based on generally accepted practices, and in accordance with the Bank of Israel's guidance, such that it is possible to estimate the risk level of customers included in the credit portfolio at any given time.

Max has in place a credit underwriting model for new customers, and a separate underwriting model for existing customers:

The Application Scoring model (AS) a statistical model, that determines a new customer's risk level; it is used to determine eligibility and credit terms (facility amount and interest rate).
The Behavior Scoring model a statistical model, that determines existing customers' risk score, based on the customer's behavior; it is used to manage the credit and make the required adjustments in relation to the credit facility, loans and the interest rate set for borrowers.

Underwriting of credit to private individuals

The process of underwriting credit to private individuals, and the monitoring of changes in an existing customers risk level is mostly carried out using a model-based process, which is based on statistical credit scoring models, as detailed above.

Max has in place control and monitoring processes that routinely monitor the development of the scores assigned to customers in the models and monitors the portfolio's risk profile on an ongoing basis. In addition to its model-based underwriting, Max uses manual underwriting in cases where further checks are required in addition to the score issued based on the model.

Among other things, the credit is managed based on constraints derived from Max's risk appetite and credit policy.

The three main products in the credit portfolio for private customers are:

Solo Loans ("all-purpose loan")

Solo loans are advanced to private customers based on a structured underwriting process in accordance with the customer's level of risk and the restrictions set by Max. These loans are not secured by any collateral of any kind. Review of the existing solo loan portfolio and the flow of new loan applications is carried out on an ongoing basis and monitored using predefined risk indicators, which are adapted periodically to changes in the market and in the characteristics of the borrowers as needed.

Credit advanced to private individuals for the purpose of purchasing vehicles

Credit advanced to private individuals for the purpose of purchasing vehicles based on a structured underwriting process and in accordance with the restrictions placed by Max. All of the said vehicles are pledged in favor of Max. Data about the development of the portfolio and the monitoring of the risk indicators are provided on an ongoing basis. Alongside the risk arising from the repayment capacity of each customer, the car loan activity also entails risks associated with the collateral - operational risks such as inappropriate lien execution, failure to receive an insurance policy with a lien clause in favor of Max, etc., and the risk inherent in the decrease in the value of the collateral (and an increase in exposure).

Revolving credit (hereinafter - "revolving")

Short-term credit which allows private individuals to set up monthly billing, with any amount that exceeds the set billing amount, "revolves" to the next month and bears interest. This product has a risk level that depends, among other things, on the monthly repayment rate out of the outstanding credit balance.

On April 27, 2025, the Bank of Israel published a press release regarding the review of the audit activity in the field of marketing and management of revolving credit cards, after conducting audits with regard to this aspect in some of the entities it regulates. The review details guidelines regarding existing customers receiving the service and customers who sign-up for the service, including a reference to fair disclosure, fairness, proactive marketing, etc. Max takes steps to implement the guidelines.

Max closely and regularly monitors risk indicators and macroeconomic developments, which indicate that despite the prolonged uncertainty arising from the ongoing War and the geopolitical situation, no material deterioration has been observed. However, there is still uncertainty regarding the extent of the expected damage to the economy and the long-term implications of the security situation, and in light of this, Max continues to apply a conservative approach with regard to credit loss provisions.

Marketing of credit to private individuals

In accordance with its strategy, Max operates to expand its private individuals' credit portfolio, while maintaining a high level of diversification. Among other things, Max defines the mix of credit products, the growth rate and the offers made to customers in accordance with internal economic parameters, and developments in macroeconomic indicators.

Max defined a policy and work processes that are suitable for marketing credit to customers, while modifying the offer in accordance with the customer's needs and characteristics. The process of marketing the credit and its approval is implemented in accordance with the principles set out in Max's Code of Ethics, which reflects the core principles adopted by Max: fairness, transparency, customer experience, initiative, partnership and excellence.

The marketing process also includes a strict assessment of the conduct risk while ensuring that the credit matches the customer's needs and maintaining transparency and fairness. This includes, among other things, providing full disclosure regarding all credit products at the time of sale, removing customers from sales lead lists, at their request, etc.

Max maintains ongoing control over the implementation of the policy and the processes set in the various distribution channels. The policy sets qualitative and quantitative principles, according to which credit will be advanced, managed and monitored, in order to improve the credit portfolio, and mitigate the risk embodied in its management. Max monitors alerts and up-to-date information regarding customers in its credit portfolio, as well as risk parameters and economic indicators, in order to monitor changes in the risk profile. Where needed, Max takes action to mitigate the risk, including by reducing credit limits, while making fair disclosure to the customer. Max has set internal limits in connection with the diversification of the various credit products that have different risk levels. Among other things, Max has set limits regarding the credit facility offered to borrowers in accordance with various parameters and thresholds it has put in

place, including in relation to the mix of the risk levels based on internal scoring models and external information. During the Reporting Period, there were no material changes in those characteristics.

Max has set an authorization hierarchy regarding credit decisions and holds periodic discussions - at least once a quarter - on the mix of risk in the portfolio, including monitoring of risk indicators, and reports on compliance with limits to Max's top risk management committee, its Board of Directors' Risk Committee and its Board of Directors.

In recent years, regulation is characterized with pro-consumer regulations, that affect Max's ability to receive repayments from its customers; in recent years, there has also been a deterioration in individuals/private borrowers' repayment capacity. Those changes are reflected in the number of bankruptcy applications, receivership orders applications, receivership orders issued, bankruptcy orders, and discharge orders. Max takes action to achieve optimal and efficient collection of debts in order to reduce the amounts of debts written-off.

Commercial credit

The risk arises from the exposure in respect of different credit products undertaken by the merchants in accordance with their needs. Max offers a range of credit products to business customers, mainly loans with various periods, and facilities for business credit card purchases, alongside autonomous guarantees to merchants aimed at securing rent payments, and an expanding range of products that addresses businesses' working capital, establishment and other needs.

The ongoing War has different effects on different economic sectors. While some sectors achieved growth, the scope of activity of others declined due to the prolonged fighting and uncertainty. In light of this, Max has been mapping the economic sectors in accordance with their level of sensitivity to the effects of the fighting and to the development of macroeconomic risks. Businesses from hypersensitive sectors are monitored frequently, in order to identify on a timely basis a potential deterioration in their condition, such as a deterioration in cash flow and in their ability to repay the debt to Max.

Underwriting commercial credit

This credit is advanced to small and micro merchants and limited liability companies. Max operates based on a tight credit policy that integrates internal restrictions on underwriting and on the management of the credit activity. To date, most of the credit to merchants is advanced to merchants, which use Max as their acquirer. In those cases, funds from acquiring may be used to settle the debt, and this mitigates the credit risk and reduces the rate of losses from such credit. The rate of credit loss provisions in respect of this credit, which is based on historical loss rates, takes this fact into account. Alongside its activities with customers which use its acquiring services, Max also advances credit to customers, which are not involved in its acquiring activities, including, among other things, as part of state-backed funds, and short-term loans for factoring suppliers' procurement, backed by a policy of an external insurance company.

Max continues to apply a conservative approach with regard to credit loss provisions.

Troubled credit

Max has set procedures for identifying troubled credit and for classifying debts as troubled. In accordance with these procedures, Max classifies all of its troubled debts and off-balance sheet credit items as: performing credit and nonperforming credit.

		March 31, 2025			March 31, 2024			December 31, 2024
		Private			Private			Private
	Commercial	individuals Others Total		Commercial	individuals Others Total			Commercial individuals Others Total
In NIS million		Unaudited				Unaudited				Unaudited
Credit risk with credit performance rating (1) On-balance-sheet
credit risk Off-balance-sheet	1,415	13,890	2,48717,792		1,225	12,428		2,223 15,876	1,309	14,060	2,385 17,754
credit risk	684		26,361 13,94440,989		601	21,976		12,877 35,454	685		25,308 13,678 39,671
Total credit risk in credit performance
rating	2,099		40,251 16,43158,781		1,826	34,404		15,101 51,330	1,994		39,368 16,063 57,425
Credit risk not in credit performance rating (2)
Non-troubled	12	435	‐	447	12	376	‐	388	12	453	‐	465
Troubled performing Troubled non	36	381	‐	417	38	333	‐	371	42	363	‐	405
performing	29	151	‐	180	27	150	‐	177	23	158	‐	181
Total on-balance sheet credit risk Off-balance-sheet	77	967		‐ 1,044	77	859	‐	936	77	974	‐	1,051
credit risk	2	31	‐	33	2	26	‐	28	2	31	‐	33
Total credit risk not in credit
performance rating	79	998		‐ 1,077	79	885	‐	964	79	1,005	‐	1,084
Overall credit risk incl. of the public	2,178		41,249 16,43159,858		1,905	35,289		15,101 52,294	2,073		40,373 16,063 58,509
Additional information on total non
performing assets:
Non-performing debts	29	151	‐	180	27	150	‐	177	23	158	‐	181
Total non performing assets	29	151	‐	180	27	150	‐	177	23	158	‐	181

Analysis of credit quality, troubled credit risk and non-performing assets:

(1) Credit risk whose credit rating at the reporting date matches the credit ratings for granting new credit in accordance with Max's policy.

(2) Credit which is not rated "performance" is credit for Max's customers whom, as of the Report Date, Max had decided not to provide with additional credit.

Comments:

A. Credit risk is stated before the effect of credit loss provision and the effect of collateral which is deductible for the purpose of indebtedness of a borrower or group of borrowers.

B. The total amount of debts with payment deferrals of 180 days or more, granted during the War to borrowers who were not in financial difficulties, is negligible.

Changes in non-performing debts for receivables for credit card transactions

			For the year ended
		For the three-month period ended March 31	December 31, 2024
		2025			2024		2024 Private
		Private			Private
	Commercial	individualsTotal	Commercial individuals			Total Commercial individuals Total
In NIS million			(Unaudited)					(Audited)
Outstanding balance of non-performing
debts as of the beginning of period	28	158	186	27	148	175	27	148	175
Loans classified as non-performing
during the period	7	87	94	10	97	107	34	411	445
Non-performing debts written-off from
the books of accounts	(5)	(60)	(65)	(6)	(58)	(64)	(20)	(227)	(247)
Repaid non-performing debts	(1)	(34)	(35)	(4)	(37)	(41)	(18)	(174)	(192)
Balance of non-performing as of end
of the period	29	151	180	27	150	177	23	158	181

Indicators of analysis of credit quality, expenses and credit loss provisions:

	As of March 31, 2025
	Commercial Private	individuals Total*)
		%
Credit quality analysis
Rate of outstanding receivables that are non-accruing for credit card transactions	1.94	1.01	1.10
Rate of outstanding receivables that are non-accruing or 90 days or more in arrears for
credit card transactions	1.94	1.01	1.10
Rate of troubled credit out of receivables for credit card transactions	4.34	3.57	3.64
Rate of credit not in credit performance rating of the balance of receivables for credit
card transactions	5.15	6.49	6.37
Analysis of expenses for credit losses for the Reporting Period
Rate of expenses in respect of credit losses out of the average balance of receivables
for credit card transactions	‐	1.23	1.23
Rate of net write-offs of the average balance of receivables for credit card transactions	1.11	1.33	1.45
Analysis of credit loss provision
Rate of balance of the provision for credit losses of outstanding receivables for credit
card transactions	3.88	2.03	2.20
Rate of balance of provision for credit losses of outstanding non-accruing receivables
for credit card transactions	200.00	200.66	200.56
Rate of the balance of provision for credit losses of outstanding receivables which are
non-accruing or in arrears of 90 days or more for credit card transactions	200.00	200.66	200.56

Rate of net write-offs of the balance of provision for credit losses for receivables for
credit card transactions	27.59	66.01	59.83

* The balance of receivables for credit card transactions does not include other accounts receivable.

	As of March 31, 2024
	Commercial Private	individuals Total
	%
Credit quality analysis
Rate of outstanding receivables that are non-accruing for credit card transactions	2.06	1.12	1.21
Rate of outstanding receivables that are non-accruing or 90 days or more in arrears for credit card transactions	2.06	1.12	1.21
Rate of troubled credit out of receivables for credit card transactions	4.95	3.61	3.73
Rate of credit not in credit performance rating of the balance of receivables for credit
card transactions	5.86	6.42	6.37
Analysis of expenses for credit losses for the Reporting Period
Rate of expenses in respect of credit losses out of the average balance of receivables
for credit card transactions	1.57	1.11	1.15
Rate of net write-offs of the average balance of receivables for credit card transactions	1.57	1.60	1.59
Analysis of credit loss provision
Rate of balance of the provision for credit losses of outstanding receivables for credit
card transactions	4.80	2.18	2.42
Rate of balance of provision for credit losses of outstanding non-accruing receivables for credit card transactions	233.33	194.67	200.56
Rate of the balance of provision for credit losses of outstanding receivables which are
non-accruing or in arrears of 90 days or more for credit card transactions	233.33	194.67	200.56
Rate of net write-offs of the balance of provision for credit losses for receivables for
credit card transactions	31.75	71.23	64.23

* The balance of receivables for credit card transactions does not include other accounts receivable.

	As of December 31, 2024
	Commercial	Private individuals	Total*)
		%
Credit quality analysis
Rate of outstanding receivables that are non-accruing for credit card transactions	1.65	1.05	1.10
Rate of outstanding receivables that are non-accruing or 90 days or more in arrears for
credit card transactions	1.65	1.05	1.10
Rate of troubled credit out of receivables for credit card transactions	4.67	3.45	3.56
Rate of credit not in credit performance rating of the balance of receivables for credit
card transactions	5.54	6.46	6.38
Analysis of expenses for credit losses for the Reporting Period
Rate of expenses in respect of credit losses out of the average balance of receivables
for credit card transactions	1.27	1.43	1.42
Rate of net write-offs of the average balance of receivables for credit card transactions	1.35	1.44	1.43
Analysis of credit loss provision
Rate of balance of the provision for credit losses of outstanding receivables for credit
card transactions	4.46	2.04	2.24
Rate of balance of provision for credit losses of outstanding non-accruing receivables
for credit card transactions	269.57	194.30	203.87
Rate of the balance of provision for credit losses of outstanding receivables which are
non-accruing or in arrears of 90 days or more for credit card transactions	269.57	194.30	203.87
Rate of net write-offs of the balance of provision for credit losses for receivables for
credit card transactions	29.03	65.15	59.08

* The balance of receivables for credit card transactions does not include other accounts receivable.

Credit Exposure to Foreign Financial Institutions

Max has an immaterial exposure involving the international organizations Visa and Mastercard in respect of the balance of transactions executed by tourists in Israel, net of the balance of transactions executed by Israelis abroad, in respect of which Max has not yet been credited by the international organizations. In the first quarter of 2025, there was no material change in Max's exposure to foreign financial institutions.

For further details regarding the credit risk, see Pillar 3 - Disclosure of Additional Information about Risks, which was posted on Max's website.

Market risks

Proper Conduct of Banking Business Directive 339, Management or Market Risks, defines market risk as the risk of loss in on-balance sheet and off-balance sheet positions as a result of a change in the fair value of a financial instrument due to change in market conditions (changes in price levels in various markets, interest rates and foreign exchange rates, inflation rates, prices of shares and commodities).

Max has a policy for the management of market risks, which is approved by Max's management and Board of Directors. The policy paper includes a reference to the risk appetite limits, and the hedging processes in respect of the different exposures and is validated from time to time. Furthermore, Max continuously monitors all financial risks, exposure levels, results of sensitivity analyses and present and expected material changes, including global and domestic macroeconomic trends and their potential effect on Max and the Israeli economy. These topics are discussed in a Financial Risk Management Forum headed by the CEO.

Exposure to interest rate risk

Proper Conduct of Banking Business Directive No. 333 regarding management of interest rate risk defines the interest rate risk as the risk to earnings or capital arising from fluctuating interest rates. Changes in interest rates affect Max's income by changing its net interest revenue (including changes in non-interest revenue/expenses). Changes in interest rates also affect the value of Max's assets, liabilities and off-balance sheet instruments, since the present value of

future cash flows (and in some cases, the cash flows themselves) changes when interest rates change.

Max's exposure to changes in interest rates arises from a number of sources:

▪ Repricing risk - arises from timing differences in repayment periods (at fixed interest) and the repricing dates (at variable interest) of Max's assets, liabilities and off-balance sheet positions. Discrepancies in repricing dates may expose the income and the economic value to unexpected fluctuations due to changes in the interest rates.

Changes in interest rates may cause an increase in prices of sources, and an erosion in profitability.

Basis risk a risk arising from imperfect correlation between interest rate changes in different financial markets, or different instruments with similar repricing characteristics. Alongside Max's interest-bearing credit assets, most of which bear variable interest (the Prime interest spread), Max raises liabilities in the form of funding sources with a different basis rate.
Fair value exposure Max's assets include balances that do not bear interest and fixed interest balances. When interest rates are changed, an exposure may arise that will lead to a decrease in Max's fair value. The exposure even increases if the average duration of the financial assets vary from that of the financial liabilities.
Yield curve risk a risk in which Max's income will be adversely affected by a parallel shift of the yield curve or by a change in its shape.

Basis risk management

The assessment of the exposure to the basis risk is carried out by analyzing the effect of the change in interest rates on the fair value and on net interest revenue. The risk arises from the exposure to future changes in interest rates, their potential effect on the value of assets and liabilities in accordance with the economic value approach, and their effect on income in accordance with the profits approach. The exposure arises, among other things, from the difference between the repayment dates and interest calculation dates of the assets and liabilities in each of the linkage bases. The mitigation of the interest rate risk also includes an assessment of the differences between the assets and the liabilities in accordance with the linkage bases, where most of Max's exposure lies in the shekel linkage base.

Max has put in place exposure monitoring indicators, upon the materialization of any of which courses of action will be set in order to mitigate the risk; among other things, and where needed, Max will use hedging instruments, as approved by Max's management and Board of Directors.

Derivative financial instruments

Generally, it is Max's policy to use derivative financial instruments for economic hedges only.

Following are the fair value data of financial instruments and the effect of changes in interest rates on the fair value:

On-balance sheet balance, net and fair value of the financial instruments of Max and its consolidated companies, except for non-monetary items:

	As of March 31, 2025
	NIS	Foreign currency *
In NIS million	Non-linked	CPI-linked USD	Other	Total
On-balance sheet balance, net	1,167	392	75	49	1,683
Financial assets	16,180	1,908	165	63	18,316
Financial liabilities	15,041	1,521	90	14	16,666
Net fair value of financial instruments	1,139	387	75	49	1,650
	As of March 31, 2024 NIS Foreign currency *

In NIS million	Non-linked	CPI-linked USD	Other	Total
On-balance sheet balance, net	-	-	-	-	-
Financial assets	15,828	359	165	41	16,393
Financial liabilities	14,557	243	73	5	14,878
Net fair value of financial instruments	1,271	116	92	36	1,515

In NIS million	As of December 31, 2024
	NIS	Foreign currency *
	Non-linked	CPI-linked USD	Other	Total
On-balance sheet balance, net	1,338	191	20	35	1,584
Financial assets	16,659	1,518	71	43	18,291
Financial liabilities	15,355	1,325	51	8	16,739
Net fair value of financial instruments	1,304	193	20	35	1,552

* Including foreign-currency linked NIS.

Effect of hypothetical changes in interest rates on the net fair value of Max's financial instruments, excluding nonmonetary items:

In NIS million	As of March 31, 2025
	NIS		Foreign currency **
	Non-linked	CPI-linked	USD	Other	Total
Simultaneous changes
Concurrent increase of 1%	7	(14)		*	*	(7)
Simultaneous decrease of 1%	(7)	14		*	*	7
Non-simultaneous changes
Steepening	3	(5)		*	*	(2)
Flattening	(3)	1		*	*	(2)
Short-term interest rate increase	(4)	(8)		*	*	(12)
Short-term interest rate decrease	4	8		*	*	12

	As of March 31, 2024
		NIS		Foreign currency **
In NIS million	Non-linked	CPI-linked	USD	Other	Total
Simultaneous changes
Concurrent increase of 1%	8		1	*	*	9
Simultaneous decrease of 1%	(8)		(1)	*	*	(9)
Non-simultaneous changes
Steepening	4		*	*	*	4
Flattening	(4)		*	*	*	(4)
Short-term interest rate increase	(4)		*	*	*	(4)
Short-term interest rate decrease	4		*	*	*	4

	As of December 31, 2024
		NIS		Foreign currency **
In NIS million	Non-linked	CPI-linked	USD	Other	Total
Simultaneous changes
Concurrent increase of 1%	7	(7)		*	*	‐
Simultaneous decrease of 1%	(7)		7	*	*	‐
Non-simultaneous changes
Steepening	3		1	*	*	4
Flattening	(3)	(2)		*	*	(5)
Short-term interest rate increase	(3)	(5)		*	*	(8)
Short-term interest rate decrease	3		5	*	*	8

* Including foreign-currency linked NIS.

Effect of scenarios of interest rate changes on net interest revenue and noninterest finance revenues:

		As of March 31, 2025
	Interest
In NIS million	revenue	Total
Simultaneous changes
Concurrent increase of 1%	37	37
Simultaneous decrease of 1%	(37)	(37)
	As of March 31, 2024
	Interest
In NIS million	revenue	Total
Simultaneous changes
Concurrent increase of 1%	39	39
Simultaneous decrease of 1%	(39)	(39)
	As of December 31, 2024
	Interest
In NIS million	revenue	Total
Simultaneous changes
Concurrent increase of 1%	38	38
Simultaneous decrease of 1%	(38)	(38)

Foreign exchange rate risk

The exposure to the foreign exchange rate risk is reflected in a loss as a result of changes in exchange rates or the consumer price index as part of Max's routine business activities. Max's exposure to the foreign exchange rate risk arises from currency exposure as a result of the effect of changes in exchange rate on foreign-currency denominated assets and liabilities in Max's balance sheets, mainly the USD and the EUR. The currency exposure is a by-product of Max's routine business activities; it does not involve a deliberate exposure by Max in order to increase income.

Most of Max's exposure to changes in foreign exchange rates arises from its activities, i.e., acquiring and issuance, in which an international organization is involved (Visa or Mastercard). Since Max has business activities linked to foreign currencies, changes in foreign exchange rates expose it to losses due to exchange rate differences.

Max's foreign exchange rate risk management mainly focuses on mitigating and minimizing the general exposure, and also to sub-exposures arising from cash flow activities and the accounting exposure.

Management of foreign exchange rate risk

Max defined a maximum exposure limit for foreign currency balances after hedging actions. The hedging of the exposure is carried out for each exposure type in accordance with Max's policy through, among other things, selling and buying of foreign currency and using financial derivatives, while maintaining the limit set and acting in accordance with the decision of the management and the Board of Directors.

Max has put in place monitoring indicators for each exposure type, upon the materialization of any of which courses of action will be set in order to mitigate the risk.

CPI risk

Max's exposure to the risk in connection with the CPI is reflected in a loss it may incur as a result of changes therein. Max has an exposure arising from CPI-linked activities, mainly due to interest-bearing credit linked to the Consumer Price Index.

CPI risk management

Max defined a maximum exposure limit to the CPI after hedging actions. The hedging of the exposure in accordance with Max's policy by, among other things, taking CPI-linked financing sources and by using financial derivatives, while maintaining the limit set and acting in accordance with the decision of the management and the Board of Directors.

Liquidity and financial risk

In accordance with Proper Conduct of Banking Business Directive No. 342 regarding liquidity risk management, the liquidity risk is defined as a risk to Max's income and stability stemming from its inability to meet its liquidity needs.

Max has a number of activities that affect its liquidity:

Cash flows from core activities, i.e., issuance, acquiring and credit activities.
Outflows in respect of use of liquidity sources, including: Repayment of and interest on bonds, and Max's operating activities.
Timing differences between the inflows arising from payments from customers, and the outflows from amounts credited to merchants in respect of the acquiring activities.
Changes in Max's cash flows arising from the behavior of Max's customers or from a significant change in other players in the financial and non-financial system.

Management of liquidity and financial risk

Among other things, Max mitigates the liquidity risk using a liquidity model that takes into account all of Max's sources and uses derived from its current and anticipated operating activities, which affect Max's cash flows. The liquidity model calculates the expected liquidity ratio; its aim is to issue an alert regarding situations where liquidity pressures may be detected. The mitigation of Max's liquidity risk takes into consideration the liquidity needs of all of the subsidiaries.

As part of its liquidity risk policy, Max defined a minimum liquidity ratio limit and performance indicators in the normal course of business and under various scenarios, that were approved by the management and Board of Directors. In addition, Max has set a methodology that assists the identification and management of a liquidity crisis in order to ensure Max's ability to meet the challenges that arise from its operating activities, and which may arise due to pressures in financial markets.

As part of its ongoing assets and liabilities management, Max uses diverse funding sources, in order to diversify the risk.

On April 7, 2025, Max was listed as a reporting corporation on the Tel Aviv Stock Exchange and on April 24, 2025, Max completed for the first time a raising of commercial papers (CPs) from institutional investors and from the public. Max's becoming a reporting corporation allows it to diversify its sources of financing by adding the option of raising funds from the public. Max's sources of financing include: Equity, banking sources, including holding secured credit facilities with several banks, which are utilized in accordance with Max's needs, which change from time to time, and raising liquid and illiquid securities through various financial instruments.

On July 1, 2021, a directive entered into effect regarding a daily acquiring arrangement, by virtue of the Israel Competition Authority's decision to exempt, subject to conditions, the interchange acquiring arrangement between the credit card companies. As from that date, transfers of funds between an issuer and an acquirer (in respect of singlepayment transactions and immediate or deferred billing transactions) are carried out on a daily basis. Consequently, there was a decrease in Max's funding needs, due to a decrease in the average utilization of the credit facilities compared with periods prior to the date on which the arrangement came into effect. The development of this trend depends on the conditions in the acquiring market.

In the Reporting Period, Max fulfilled its obligations and met all the conditions in connection with the financing agreements to which it is a party. Max has a forum for the management of financial risks, which is headed by its CEO; Max's CFO, Chief Risk Officer and Chief Internal Auditor attend the forum's meetings. Among other things, the forum discusses exposures and hedging actions. In November 2024, the rating agency Midroog Ltd. reiterated Max's issuer rating at Aa3.il (rating outlook: stable), the rating of Max's Subordinated Notes (Series D) at A1.il (hyb) (rating outlook: stable) and the rating of Commercial Papers at P-1.il.

In December 2024, the rating agency Midroog Ltd. assigned a P-1.il rating for Commercial Paper raised by Max through an expansion of Commercial Papers (Series 2). In April 2025, the rating agency Midroog Ltd. assigned a P-1.il rating to liquid Commercial Papers (Series 5), issued to the public on April 24, 2025.

Max also monitors the effect of macroeconomic conditions, and if the War will continue and/or expand and/or if the State of Israel's credit rating will be downgraded again, the supply of sources of financing in the economy may be smaller and Max's exposure to the liquidity risk will increase. The Company believes that such deterioration scenarios may affect the cost of the sources available to Max, but it expects that it will still have sufficient sources of financing to maintain its business activities.

Operational risk

Proper Conduct of Banking Business Directive No. 350 regarding operational risks defines an operational risk as "the risk of a loss as a result of the inadequacy or failure of internal processes, personnel, and systems, or as a result of external events. This definition includes legal risk but does not include strategic risk and reputational risk". There are situations where other risks materialize, such as: credit risk, compliance risk, and reputational risk are caused as a result of an operational failure.

Max is exposed to operational risks as part of its activities, such as:

The issuance activity as part of its issuance activity, Max is exposed to fraudulent transactions, both in Israel and abroad, involving the credit cards it issues. In recent years, digital transformation processes have accelerated and the adoption of new technologies has become rapid and widespread, both among customers and among the companies, as reflected in new products and services. These changes have led to an increase in cyber threats, financial crime, and digital fraud. Max invests and will continue to invest considerable resources in strengthening its identification, monitoring and control systems; those resources are also invested in advanced technologies in order to deal with the exposure to risks in an optimal manner.
The acquiring activity as part of the acquiring activity, Max provides payment spreading and factoring services. The exposure in respect of these services arises from the risk that a merchant will not supply the goods it had undertaken to supply, and which may lead customers to complain about "failure to deliver". The scope and period of exposure was derived from the type of service provided by the merchant in accordance with the product supply date.

In addition, operational risks are naturally present in all of Max's processes, and arise, among other things, from actions carried out by Max's employees across the various units, from the use of various technologies and various IT systems.

Operational risk management

Operational risk management at Max complies with Proper Conduct of Banking Business Directives, which determine, among other things, basic risk management principles. Risk management at Max is an ongoing process of identifying and assessing risks, ongoing measurement of the exposures and capital requirements to cover these risks and reporting to management and the Board of Directors.

Following are the key principles in operational risk management:

The three lines of defense The first line of defense is the business units that assume the risk, which is charged with formulating the internal controls to reduce exposure and minimizing the probability of risk materializing and the damage arising its materialization. The second line of defense is operational risk management, headed by the Chief Risk Officer, who is an independent entity which outlines the policy, the risk management work framework, and control - as described below. The third line of defense is the internal audit, which performs independent audits.
Operational risk policy Max has an operational risk policy, which is validated and approved by the management and Board of Directors once a year. The policy includes corporate governance for risk management, the risk management framework, and risk appetite limitations.
Operational risks map Max maintains an operational risks map, which covers its key processes, and is validated from time to time together with the business units. The risk map includes assessment of the inherent risk, assessment of the control, and assessment of the residual risk. The operational risk map serves as a support tool for business decision making and assessment of the exposure to operational risk.
Risk identification, measurement, and assessment methodology Max has uniform methodology for identifying and assessing the operational risks inherent in its activities. The identification methodology uses various tools and includes quantitative and qualitative risk assessment and assessment of the effectiveness of the controls over the risks.
Operating loss and near loss events Max has a regulated process for reporting operating loss and near-loss events, and a process for drawing conclusions and learning from these events. Collection of data on loss events supports, among other things, the process for assessing operating risk exposure.
New products Max has an orderly risk management process for new products including new systems, activities and processes. Under this process, a mapping of potential risks is carried out in all of the organization's units and accordingly effective risk mitigation and control plans are defined before the launch of new products and services or when they undergo changes.

For further details regarding the operational risk, see Disclosure of Additional Information about Risks, which was posted on Max's website.

Other risks

Information security and cyber risk

According to Proper Conduct of Banking Business Directive No. 361, Cyber Defense Management, the cyber risk is defined as the potential for damage resulting from an occurrence of a cyber incident, taking into account its probability and its severity of its impact. A cyber incident is an event during which the Company's IT and/or computer-embedded systems and infrastructures are attacked by, or on behalf of, opponents (whether external or internal to Max), and such attack may result in the materialization of the cyber risk.

In its capacity as a financial organization, Max is an attractive target for various attackers. The computer systems and communication networks that serve Max's customers are a target for cyber-attacks, the introduction of malwares, malicious code, phishing attacks, and other exposures aimed to damage Max's services, steal information or damage its database.

Max's business activities rely - to a large extent - on technology-based systems. Therefore, the availability of the systems, the reliability of the data, and maintaining the confidentiality of the data are essential for an orderly business activity. Furthermore, Max views business and customer information stored on its systems and on its suppliers' systems as a key asset and invests many efforts and resources in implementing advanced information security control and defense mechanisms and processes.

Max's information security and cyber security strategy paper defines its approach and objectives regarding information security and cyber security in accordance with Max's business strategy. The paper aims to constitute a framework for the information security and cyber security policy and work procedures in this field, which define the management and implementation principles, areas of responsibility, the relevant officers and their powers, and the operations and technologies used by Max. As part of the preparations it makes to deal with the various cyber threats, Max has in place and leads internal and external processes to mitigate the cyber threats posed against it and its customers. As part of the above, cyber security risks are mitigated through a number of security and control cycles, on several levels, in order to mitigate the potential exposures in respect of this threat.

A hybrid work routine, which combines remote work with on-site work, transferring business systems to cloud infrastructure, and the growing use of AI capabilities triggered a change in Max's exposure to cyber risks. Max adapted its defenses and controls against those risks and took steps to implement additional controls in order to enhance its defenses as part of the hybrid work environment.

Since the beginning of the War, there has been an increase in the number of cyber attacks taking place in Israel, and the number of anti-Israeli parties taking part in the attacks has been on the rise.

The attacks are mainly various DDoS attacks; there has also been a sharp rise in the number of malicious links sent by email and SMS messages, phishing messages, accessing unprotected private cameras, taking over social media accounts and distributing malicious software.

In addition, during the War there has been a high volume of psychological warfare and disinformation in the cyberspace, fake news regarding cyber attacks and in general, all aimed to generate fear among the Israeli public.

To date, no attacks have been identified, which penetrated Max's network. However, in view of the above, Max is preparing for potential attacks by tightening and strengthening its controls in this field and works to raise awareness among its employees.

In November 2024, the Banking Supervision Department published Proper Conduct of Banking Business Directive No. 364 - "Management of Information Technology Risks, Information Security and Cyber Security", which supersedes 3 existing Proper Conduct of Banking Business directives (Proper Conduct of Banking Business Directive No. 357 - "Information Technology Management", Proper Conduct of Banking Business Directive No. 361 - "Cyber Defense Management" and Proper Conduct of Banking Business Directive No. 363 - "Supply Chain Cyber Risk Management"). Max is working towards applying the directive at its effective date - April 2026.

Strategic Risk

A strategic risk is the risk of adversely affecting Max's income, capital, reputation or position as a result of erroneous business decisions, inappropriate implementation of decisions or lack of response to industry-specific, economic, regulatory and technological changes.

Strategic risks may be divided into 3 types:

* External environment risks arising from changes in the political, economic and social environment.
* Competition environment risks arising from changes in the competition environment in which Max operates.

* Internal environment - risks arising from decisions, processes or actions Max has taken or avoided taking.

Max currently faces significant challenges in all areas of activity, multiple threats in its core businesses alongside opportunities and dealing with material regulatory changes.

Strategic risk management in The Company is based on continuously assessing its strategy, including, among other things, the following activities:

* Formulating a long-term strategic plan, that includes a review and assessment of various events in the work environment (regulation, competition, technology, etc.), and assessment of the anticipated changes with respect to Max's each and every line of business.
* Regular discussions by Max's management and Board of Directors, as part of which those changes are presented, and the need to revise the strategy is considered.
* The Risk Management Department challenges the assessments of the strategic trends as identified by The Company on a regular basis; it also raises topics which are relevant to the strategic risk where necessary.

Regulatory risk

Regulatory risk is the risk of loss due to the effect of future expected regulation, including legislation and/or directives issued by various regulators. Max is exposed to a regulatory risk with respect to all of its areas of activity.

The business environment in which Max operates is a dynamic environment, on which regulators and legislators currently focus. These regulatory changes were designed, among other things, to encourage competition in the field by reducing entry barriers and cutting costs to the customers, and protecting customers in the context of fair disclosure, etc. This regulatory framework mostly tightens the restrictions on activity in the industry and sometimes leads to a regulatory mismatch between Max and its competitors. However, a number of expected regulatory changes are expected to serve as a source of new business opportunities.

The management of the regulatory risk is carried out by regularly identifying new regulatory initiatives and referring them to the relevant function in Max and continuously reporting them to Max's management.

Upon its listing as a reporting corporation, Max is regulated by the Israel Securities Authority.

For more information regarding the new regulatory provisions relevant to Max's activities, see the corporate governance report, further details and appendices below.

Compliance risk

Compliance risk is the risk of a legal or regulatory sanction being imposed, and/or a material financial loss and/or a reputational damage incurred by Max as a result of failing to comply with the laws and regulations. According to Proper Conduct of Banking Business Directive No. 308 on compliance, Max is required to mitigate all compliance risks arising from all the laws, regulations, guidance and circulars applicable to its activities. The management of the compliance risk is an integral part of Max's business activities and does not fall exclusively within the remit of the compliance function. The lines of business bear significant responsibility to the issue of compliance and play an active role in the management and mitigation of Max's exposure to compliance risks.

Max's compliance function operates bearing in mind the unique challenges Max faces on several levels in order to mitigate compliance risks. This is done while continuously assessing the evolving risk picture and applying a risk-based approach in the face of the state of emergency while integrating and implementing the various regulatory provisions.

The compliance function works continuously to integrate and implement the directives issued by the various regulators, adapting them to Max's activity in coordination with the business units.

Money laundering and financing of terrorism risk

The money laundering and/or financing of terrorism risk is the risk that the organization and its employees' fail to comply with the provisions of the law and regulation and the work processes for the implementation of the provisions at Max and consequently the imposition of a sanction and/or financial sanction and criminal liability on the corporation and its officers and adverse effect on Max's reputation.

Max adapts the work processes and controls to new typologies and regulatory provisions regarding the prohibition of money laundering and financing of terrorism.

Under these processes and in accordance with regulatory provisions and the requirements of international organizations, Max acted to validate and strengthen the dedicated processes associated with the fulfillment of Max's obligations regarding international sanctions, which have intensified since the outbreak of the War.

Max continues to adapt its internal monitoring, control and prevention processes in accordance with the risk management assessment and the potential of evolvement of various risks with an emphasis on countries at increased risk and/or high-risk sectors. Reports are delivered regularly to regulators.

Legal risk

The risk arising from an activity of Max regarding which there is a concern that it is not in line with legal provisions (whether primary or secondary legislation), directives and guidance issued by competent authorities, regulation, or case law, a risk arising from legal proceedings conducted against Max, and the risk arising from a concern that Max will breach contractual obligations. Legal risk is also defined as a deficient legal opinion, including drawing up agreements that do not adequately protect Max's rights, or failure to give appropriate guidance due to changes in legislation, regulatory directives, case law, or Max's contractual obligations.

Max's risk management approach was that the management of the legal risk is an integral part of the business environment. Consequently, decisions regarding the legal policy are made jointly by the business functions and by the legal counsels.

Max has a legal risk officer, whose purview involves mitigating Max's legal risk while reaching optimal correlation between Max's activities and the legal risks, such that the decision making will correspond to Max's risk appetite.

Legal counseling is provided to Max by its Legal Counsel Department in collaboration with the external attorneys Max works with.

Reputational risk

Reputational risk is the potential that negative publications, market rumors, or the public perception or social protests regarding the operating methods of Max and its employees, will have an adverse effect on its reputation, and lead to a decline in its customer base, or result in high legal costs, or a decrease in revenue. The reputational risk is a natural part of Max's activities and is a company-wide risk. All of Max's products, activities, processes, and systems, as well as Max's collaborations with other companies and entities, embody a potential risk, whether as part of its business activities or as part of its administrative-internal activities, whether done maliciously or in good faith.

The management of the risk by Max is composed, first and foremost, of a process for identifying reputational exposures (any action which may be associated with the brand and lead to negative media coverage or discourse), which is addressed using the New Product Procedure. Monitoring and response are carried out continuously.

Macroeconomic risk

Macroeconomic risk is the risk that the income and capital of Max may be adversely affected by a deterioration in the macroeconomic environment in Israel and across the world. Max's business strategy and capital planning include assumptions, that are derived, among other things, from the macroeconomic environment, and Max assesses and evaluates the effect of the changes in the macroeconomic environment on its business results and capital planning.

The high interest rate environment is onerous for consumers and merchants and may affect the credit risk. Max monitors trends in the development of macroeconomic risk against the backdrop of geopolitical uncertainty, which arises, among other things, from the economic implications of the Iron Swords War and the effect of the downgrading of the State of Israel's rating. Max monitors and mitigates this risk continuously, and at this stage there is no material increase in the materialization of the potential risk.

On April 3, 2025, the President of the United States announced a new tariff plan on goods imported to the United States from various countries. Those countries include China, the European Union, the UK, Israel and others; under the plan, a 17% tariff will be imposed on exports from Israel to the United States. Max assesses the plan's effect on its business customers, both direct effects as a result of trade activities with the US and indirect effects of the tariff plan; Max continues to monitor potential developments and effects.

Max is assessing its ability to withstand adverse developments in the macroeconomic environment using systemic stress scenarios. Furthermore, Max continuously monitors various risk indicators, including macroeconomic indicators, and material changes in those indicators are discussed by the Financial Risk Management Forum, which is chaired by its Enterprise Risk Management Committee, which is chaired by its CEO and Board of Directors' Risk Committee.

Environmental and climate risks (ESG)

Environmental risk is the risk of loss resulting of non-compliance with environmental protection directives and enforcement thereof. In recent years, the definition of environmental risk has expanded, and currently also includes the organization's effect on the environment even if it is not directly associated with a financial loss. Furthermore, the

risk is currently viewed as a global risk arising from the potential adverse effects of environmental changes, including on people, ecological systems, and economic and financial activities. Environmental risks arise not only due the pollution of air, water and land, but also due to damage to economic and social infrastructures, mainly due to climate change.

The climate risk is an evolving risk arising, among other things, from the impact of the materialization of environmental risks and from regulatory developments, developments in the business environment, and technological developments relating to the adaptation to climate change.

Max's management decided to implement environmental responsibility values and adapt its activities in order to protect the environment.

As from 2009, Max has ISO 14001:2015 certification and is assessed once a year by the IQC Institute of Quality & Control for compliance with the standard's requirements; inter alia, the environmental risk survey is revised and improved. As part of its implementation of the standard's provisions, Max takes action to increase awareness among its employees.

At the beginning of July 2024, the Company published an ESG report for 2022-2023, which summarizes and reflects the main activities of the Company, which impact the environment, society and corporate governance, out of a deep commitment and a sense of responsibility to the society and environment in Israel. Max opted to publish the report in view of the great importance it places on sharing with The Company's customers, employees and other stakeholders its actions in the above areas. The Company is preparing to implement Proper Conduct of Banking Business Directive 345 - principles for the effective management of climate-related financial risks.

Model risk

Model risk is the exposure to loss or to damage to Max's reputation, due to business decisions based on erroneous or biased model results, or on excessively broad interpretation of the model results. This risk may arise, among other things, due incompatibility of the model with the business reality, usability that is not in line with the designation, and errors in calculations and data when applying the model.

The principles for model risk management are defined in Max's policy, which outlines independent validation processes, corporate governance, authorization hierarchy, and risk management processes. The use of models in decision-making processes has been growing in recent years, and accordingly the model risk management system at the Company is compatible with this direction as appropriate and required. The Company changes the monitoring level and frequency in accordance with the level of domestic and global uncertainty, in order to mitigate and minimize the model risk.

In August 2024, the Banking Supervision Department published Proper Conduct of Banking Business Directive No. 369 "Model Risk Management". Max is working to implement the directive on its effective date - August 2025.

7. Disclosure regarding Financial Reporting of the Corporation

7.1. Reporting Critical Accounting Estimates

For details on the use of estimates and judgments in the preparation of financial statements, see Note 2(B) to the Financial Statements.

7.2. Contingent Liabilities

The independent auditors' report to the shareholders of the Company includes an emphasis of matter paragraph regarding that which is stated in Note 9 to the Financial Statements regarding exposure to contingent liabilities.

7.3. Internal Control over Financial Reporting and Disclosure

7.3.1.Securities Regulations

In December 2009, the Securities Regulations (Periodic and Immediate Reports (Amendment No. 3), 2009 were published, which deal with the corporation's internal control over financial reporting and disclosure function; their aim is to improve the quality of financial reporting and disclosure in reporting corporations.

An amendment of July 7, 2011 prescribes that a corporation that consolidates a banking corporation or an institutional entity or carries out proportionate consolidation of a banking corporation or an institutional entity, may opt to implement - only with regard to the internal control in that banking corporation or institutional entity - the format of assessing the effectiveness of internal control prescribed in the other laws applicable thereto in that respect, if such a format is in place regarding the quarterly report.

Accordingly, in addition to the officers' statements and the report on the effectiveness of internal control provided in the quarterly report, disclosure and officers' statements are attached in connection with the internal control in the consolidated institutional entities to which the Commissioner's Directives apply.

In addition to officers' statements regarding internal control in the consolidated credit card company, which is subject to the directives of the Banking Supervision Department regarding the assessment of the effectiveness of internal control over financial reporting.

7.3.2 Commissioner's Directives regarding Internal Control over Financial Reporting and Disclosure

In recent years, the Commissioner published a number of circulars (hereinafter - the "Commissioner's Circulars"), which are designed to implement the requirements of Section 302 and Section 404 of the SOX Act in insurance companies, in management companies of pension and provident funds, and in pension and provident funds (hereinafter - the "Institutional Entities").

Accordingly, Clal Insurance and the consolidated institutional entities included the information in accordance with the provisions of the law and the reporting provisions on the dates as set in those directives.

7.3.3 Section 302 and 404 of the SOX Act - Management's Responsibility for Internal Control over Financial Reporting and Disclosure

According to the Commissioner's circulars, which are based on Section 302 and Section 404 of the SOX Act, and as detailed in previous Reports of the Board of Directors of Clal Insurance, Clal Insurance has worked continuously to implement the required procedure in accordance with the said provisions, which includes an assessment of the work processes and the internal controls being implemented, in accordance with the stages and the dates set in the circulars. As part of this process, Clal Insurance adopted the internal control model of the Committee of Sponsoring Organizations of the Treadway Commission (COSO) - the Committee of Sponsoring Organization of the Treadway Commission - which is a generally accepted framework for assessment of internal controls.

The management of Clal Insurance (the institutional entity), in collaboration with its CEO, Deputy CEO and Head of the Finance Division, have evaluated the effectiveness of Clal Insurance's disclosure controls and procedures as of the end of the Reporting Period. Based on this assessment, the CEO, Deputy CEO and Head of the Finance Division of Clal Insurance concluded that, as of the end of this period, the controls and procedures as to Clal Insurance's disclosure are sufficiently effective for recording, processing, summarizing, and reporting the information that Clal Insurance is required to disclose in its quarterly report in accordance with the provisions of the law and the reporting provisions set by the Commissioner, and on the date set out in these provisions.

During the quarter ending March 31, 2025, no changes took place in the internal control over financial reporting of the Group's institutional entity that had a material effect, or is expected to have a material effect, on the institutional entity's internal control over financial reporting.

Internal control changes

The Company's first-time application date of IFRS 17 (hereinafter - "IFRS 17" or the "Standard") regarding insurance contracts, which superseded IFRS 4 - Insurance Contracts - was January 1, 2025. In addition, on the abovementioned date the Company applies for the first time IFRS 9, Financial Instruments (hereinafter - "IFRS 9"), which supersedes IAS 39, Financial Instruments (hereinafter - "IAS 39") (see also Note 3 – Significant Accounting Policies).

The application of the new provisions involved lengthy and complex preparations, which included, among other things, revising accounting policies, improving models and defining new models, creating databases and interfaces, integrating a selected technological application, etc.

Following the first-time application of the Commissioner's Directives, in the first quarter of 2025 there was a material change in the process of measuring liabilities and assets for insurance contracts, which are accounted for under IFRS 17, and a change in the process of classifying and measuring financial instruments in the Company, which are accounted for under IFRS 9.

In order to prepare the data of liabilities and assets for insurance contracts and financial instrument data (hereinafter - "These Data") and for the purpose of assessing the effectiveness of the controls and procedures regarding their disclosure for the first quarter, the Company made preparations in accordance with the roadmap set by the Commissioner, to map the control environment associated with the work processes of These Data. As part of the preparations, the work processes associated with These Data were assessed, and the map of controls and risks was revised. Most of the new and revised controls, especially those associated with data integrity, analysis and reasonableness of results, had already been integrated under the preparation of the Financial Statements as of December 31, 2024 . Additional controls, including those relating to the new disclosures required in financial reporting, were integrated under the preparation of the Financial Statements as of March 31, 2025.

The Company continues to develop the required reports and to improve and develop the process of preparing the data of liabilities and assets for insurance contracts and financial instrument data, including the control and risk map.

Officers' Statements on the Effectiveness of Internal Control over Financial Reporting and Disclosure, in relation to the relevant processes, in accordance with the Commissioner's Circulars, are attached to the report.

7.3.4 Management's Responsibility for Internal Control over Financial Reporting (SOX Act 404)

The Banking Supervision Department's directives impose the requirements of Sections 302 and 404 of the SOX Act on credit card companies.

These sections, set by the SEC and Public Company Accounting Oversight Board, have established provisions with regard to the abovementioned sections, on management's responsibility for instating and maintaining disclosure controls and procedures and for exercising internal control over financial reporting and the opinion of the independent auditors on the audit of internal control over financial reporting.

Among other things, the Banking Supervision Department's directives prescribe that banking corporations shall apply the provisions of Sections 302 and 404 and the SEC directives issued thereunder. In addition, adequate internal control requires an auditing function that follows a predefined, recognized framework, and the model of COSO (Committee of Sponsoring Organizations of the Treadway Commission) meets these requirements and can be used to evaluate the internal controls.

Max It Finance Ltd. (hereinafter - "Max") implements the provision in accordance with the Banking Supervision Department's directives as stated above.

7.3.5.Evaluation of disclosure controls and procedures

Max's management, with the cooperation of its CEO and Chief Accountant, have evaluated the effectiveness of Max's disclosure controls and procedures as of the end of the Reporting Period. Based on this evaluation, the CEO and the Chief Accountant have concluded that, as of the end of the Reporting Period, Max's disclosure controls and procedures are effective for the purpose of recording, processing, summarizing and reporting the information that the Company is required to disclose in its quarterly financial statements pursuant to the Banking Supervision Department's Reporting to the Public Directives and as of the date prescribed by the Directives.

Internal controls over financial reporting:

During the first quarter ended March 31, 2025, no changes took place in Max's internal control over financial reporting that had a material effect, or is expected to have a material effect, on the Company's internal control over financial reporting.

The Board of Directors wishes to thank the employees, managers and agents of Group companies for their contribution to the Group's achievements.

Haim Samet Chairman of the Board

Yoram Naveh CEO

Tel Aviv, May 28, 2025

Clal Insurance Enterprises Holdings Ltd. Condensed Consolidated Interim Financial Statements as of March 31, 2025 (Unaudited)

	Page
Review Report of the Independent Auditors	2-2
Consolidated Interim Statements of Financial Position	2-3
Consolidated Interim Statements of Profit and Loss	2-5
Consolidated Interim Statements of Comprehensive Income	2-7
Consolidated Interim Statements of Changes in Equity	2-8
Consolidated Interim Statements of Cash Flow	2-11
Notes to the Consolidated Interim Financial Statements:
Note 1 - General	2-14
Note 2 - Basis of preparation of the interim financial statements	2-16
Note 3 - Significant accounting policies	2-19
Note 4 - Segment reporting	2-36
Note 5 - Financial instruments	2-44
Note 6 - Capital management and requirements	2-61
Note 7 - Income (loss) from insurance services and reinsurance	2-66
Note 8 - Income (loss) from investments and financing, net	2-69
Note 9 - Contingent liabilities and claims	2-72
Note 10 - Credit risk, receivables for credit card transactions and credit loss provision	2-106
Note 11 - Payables for credit card transactions	2-118
Note 12 - Revenues from credit card transactions	2-119
Note 13 - Additional events in and subsequent to the reporting period	2-120
Note 14 - Application of IFRS 17 and IFRS 9 in subsidiaries which meet the definition of an insurer in accordance with securities regulations (preparation of annual financial statements), 2010	2-123

Appendices to the Consolidated Interim Financial Statements

Appendix - Interest revenue and expense rates and analysis of the changes in Max's interest income		2-136
and expenses

Somekh Chaikin Millennium Tower KPMG 17 HaArba'a Street, POB 609 Tel Aviv 6100601 +972-3-684-8000

Kost Forer Gabbay & Kasierer 144 Menachem Begin St., Tel Aviv 6492102 Tel. +972 3 623 2525 Fax +972 3 562 2555 ey.com

Review Report of the Independent Auditors for the Shareholders of Clal Insurance Enterprises Holdings Ltd.

Introduction

We have reviewed the accompanying financial information of Clal Insurance Enterprises Holdings Ltd. and its subsidiaries (hereinafter - the "Group"), including the condensed consolidated statement of financial position as of March 31, 2025 and the condensed consolidated statements of profit and loss, comprehensive income, changes in equity and cash flows for the three-month period then ended. The Board of Directors and management are responsible for the preparation and presentation of financial information for this interim period in accordance with the Israel Securities Regulations (Periodic and Immediate Reports), 1970, which pertain to holding companies of insurers and credit card companies, as described in Note 2(a) to the Financial Information. Our responsibility is to express a conclusion regarding the financial information for this interim period based on our review.

We did not review the condensed interim financial information of the equity-accounted investee, the investment in which amounted to approx. NIS 96 million as of March 31, 2025, and the Group's share in the income of which amounted to approx. NIS 4 million for the three-month period then ended. The condensed interim financial information of the company was audited by other independent auditors, whose review report was furnished to us, and our conclusion, insofar as it relates to financial information in respect of the company, is based on the review report of the other independent auditors.

Scope of the Review

We performed our review pursuant to Review Standard (Israel) 2410 of the Institute of Certified Public Accountants in Israel, Review of Interim Financial Information Performed by the Independent Auditor of the Entity. A review of interim financial information consists of inquiries, mostly of persons responsible for financial and accounting issues, and of applying analytical and other review procedures. A review is substantially smaller in scope than an audit performed pursuant to generally accepted auditing standards in Israel and, as a result, does not enable us to obtain assurance that we would become aware of all significant matters that may be identified in an audit. Consequently, we are not expressing an audit opinion.

Conclusion

Based on our review and the review report of other independent auditors, nothing has come to our attention that causes us to believe that the abovementioned financial information does not comply, in all material respects, with the Israel Securities Regulations (Periodic and Immediate Reports), 1970, which pertain to holding companies of insurers and credit card companies, as described in Note 2(a) to the financial information.

Emphasis of matter

Without qualifying the above conclusion, we draw attention to that which is stated in Note 9 to the consolidated interim financial statements regarding exposure to contingent liabilities.

Tel Aviv, May 28, 2025 Somekh Chaikin Certified Public Accountants Kost Forer Gabbay & Kasierer Certified Public Accountants

Joint Independent Auditors

Consolidated Interim	Statements of	Financial	Position
-------------------------	------------------	-----------	----------

				As of
		As of March 31		December 31
		2025	2024	2024
In NIS million			Unaudited
Assets
Cash and cash equivalents in respect of yield-dependent contracts		4,985	5,025	4,451
Other cash and cash equivalents		1,848	2,233	2,617
Financial investments in respect of yield-dependent contracts measured at fair value	5	86,330	85,489	88,802
Other financial investments measured at fair value	5	41,675	40,748	41,179
Other financial investments measured at depreciated cost	5	2,328	2,333	2,340
Receivables for credit card transactions, net	10	17,852	15,891	17,855
Receivables and debit balances		1,553	953	642
Current tax assets		18	144	60
Insurance contract assets		2,624	2,187	2,653
Reinsurance contract assets		2,609	2,582	2,664
Investments in equity-accounted investees		194	182	190
Investment property in respect of yield-dependent contracts		3,944	3,852	3,924
Investment property - other		1,528	1,501	1,517
Property, plant and equipment		301	307	310
Intangible assets and goodwill		2,199	2,206	2,212
Costs of obtaining investment management service contracts		794	713	764
Deferred tax assets		164	137	159
Right-of-use assets		666	672	669
Total assets		171,611	167,154	173,008
Total assets in respect of yield-dependent contracts		96,133	94,698	97,329

The attached notes to the consolidated interim financial statements are an integral part thereof. See Note 14 regarding application of IFRS 1, First-time Adoption of International Financial Reporting Standards, first-time application of IFRS 17, Insurance Contracts and first-time application of IFRS 9, Financial Instruments. Relevant comparative figures have been restated.

	Consolidated Interim	Statements	of Financial	Position	(cont.)
--	-------------------------	------------	-----------------	----------	---------

				As of
		As of March 31		December 31
		2025	2024	2024
In NIS million	Note	Unaudited
Liabilities
Loans and credit	5	13,870	12,280	14,138
Liabilities for derivative instruments	5	929	703	528
Payables and credit balances		1,655	1,846	1,739
Payables for credit card transactions	11	9,933	9,074	9,707
Current tax liability		67	68	18
Liabilities for yield-dependent investment contracts		12,251	13,032	12,537
Liabilities in respect of non-yield-dependent investment contracts		2,520	2,476	2,522
Liabilities for insurance contracts		119,870	119,024	121,718
Labilities in respect of reinsurance contracts		62	68	62
Liability for employee benefits, net		90	92	89
Deferred tax liabilities		363	45	355
Lease liabilities		770	769	775
Total liabilities		162,380	159,476	164,189
Equity
Share capital		167	167	167
Share premium		2,426	2,394	2,423
Capital reserves		140	140	138
Surplus		6,421	4,902	6,014
Total equity attributable to the Company's shareholders		9,154	7,603	8,742
Non-controlling interests		77	75	76
Total equity		9,231	7,678	8,818
Total liabilities and equity		171,611	167,154	173,008

May 28, 2025
Approval date of the	Haim Samet	Yoram Naveh	Eran Czerninski
financial statements	Chairman of the Board of Directors	CEO	Executive Vice President
			Finance Division Director

Consolidated Interim Statements of Profit and Loss

	For the three-month		For the year ended
	period ended March 31		December 31
	2025	2024	2024
In NIS million		Unaudited
Revenues from insurance services	2,178	2,030	8,391
Expenses from insurance services	(1,817)	(1,666)	(6,566)
Income from insurance services before reinsurance contracts held	361	364	1,825
Reinsurance expenses	(350)	(384)	(1,441)
Reinsurance revenues	225	203	683
Revenues (expenses), net from reinsurance contracts held	(124)	(181)	(758)
Income (loss) from insurance services	236	183	1,067
Investment gains (losses), net from assets held against insurance contracts and
yield-dependent investment contracts	151	3,783	10,635
Gains (losses) from other investments, net:
Interest revenues calculated using the effective interest method	85	42	220
Other investment income (losses), net	51	755	2,777
Share in profits (losses) of equity-accounted subsidiaries closely related to the
investing activity	(1)	(1)	(2)
Total gains (losses) from other investments, net	135	795	2,995
Total investment gains (losses), net	285	4,578	13,630
Finance expenses (income), net arising from insurance contracts	(51)	3,752	11,041
Finance income (expenses), net arising from reinsurance contracts	1	31	149
Decrease (increase) in liabilities for investment contracts due to the yield component	(36)	(617)	(1,660)

Income (loss) from investments and financing, net	302	239	1,078
Income (loss), net from insurance and investment	538	422	2,145
Investment income, net and finance income which are not from a consolidated
insurance company	354	345	1,370
Revenues from credit card transactions	409	354	1,554
Revenues from management fees	205	199	805
Revenues from fees and commissions of Brokers (Agencies)	49	39	180
Credit loss expenses	(46)	(41)	(216)
Credit card processing	(255)	(228)	(986)
Payments to banks	(61)	(54)	(233)
Other operating expenses	(388)	(356)	(1,509)
Other revenues (expenses), net	(11)	(8)	(47)
Other finance expenses	(194)	(196)	(794)
Share in profits (losses) of equity-accounted subsidiaries which are not closely related
to the investing activity	4		3 16
Income (loss) before income tax	605	480	2,286
Taxes on income	197	165	739
Income (loss) for the period	408	315	1,546
Attributable to:
Company's shareholders	407	313	1,540
Non-controlling interests	1		2 6
Income (loss) for the period	408	315	1,546

Consolidated Interim Statements of Profit and Loss (cont.)

	For the three-month period ended March 31		For the year ended December 31
	2025	2024	2024
In NIS million	Unaudited
Earnings (loss) per share attributable to the Company's shareholders:
Basic earnings (loss) per share (in NIS)	5.12	3.97	19.47
Diluted earnings (loss) per share (in NIS)	4.96	3.96	19.38
No. of shares used to calculate earnings per share (in thousand):
Basic	79,494	79,036	79,099
Diluted	82,127	79,204	79,475

Consolidated Interim Statements of Comprehensive Income

	For the three-month period For the year ended
	ended March 31		December 31
	2025	2024	2024
In NIS million		Unaudited
Income (loss) for the period	408	315	1,546
Other comprehensive income:
Other comprehensive income items that, subsequent to initial recognition in comprehensive income, were or will be carried to profit and loss:
Foreign currency translation differences in respect of foreign operations carried to capital reserve	3	1	(1)
Foreign currency translation differences in respect of foreign operations stated in profit and loss	‐	‐	‐
Other comprehensive income (loss) for the period carried or to be carried to profit
and loss, before tax	3	1	(1)
Tax (tax benefit) for other components	1	‐	‐
Other comprehensive income (loss) items that, subsequent to initial
recognition in comprehensive income, were or will be carried to profit and loss, net of tax	2	1	(1)
Items of other comprehensive income not transferred to profit and loss:
Actuarial gains (losses) from a defined benefit plan	‐	‐	1
Tax (tax benefit) for items of other comprehensive income not transferred to profit and loss	‐	‐	‐
Other comprehensive income (loss) not transferred to profit and loss,
net of tax	‐	‐	‐
Other comprehensive income (loss) for the period	2	1	‐
Total comprehensive income (loss) for the period	410	316	1,546
Attributable to:
Company's shareholders	409	314	1,540
Non-controlling interests	1	2	6
Total comprehensive income (loss) for the period	410	316	1,546

Consolidated Interim Statements of Changes in Equity

Attributable to Company's shareholders
Share capital	Share premium	reserve			Capital reserve with non controlling interests			Total	Non interests		Total equity

			(2)							76	8,818
	‐	‐	‐			‐				1	408

											3
											‐
	‐	‐	‐			‐				‐	‐
	‐	‐	(1)			‐				‐	(1)
	‐	‐	2			‐				‐	2
	‐	‐	2			‐				1	410

	‐		‐			‐				‐	‐
	‐	‐	‐			‐				‐	3
			-								9,231
		167 ‐ ‐ 167	2,423 ‐ ‐ 3 2,426	Translation 3 ‐	Other capital reserves	180 ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 180	from transactions (40) ‐ ‐ (40)	Retained earnings	6,014 407 ‐ ‐ ‐ ‐ ‐ 407 (3) 3 6,421	8,742 407 3 ‐ ‐ (1) 2 409 ‐ 3 9,154	controlling ‐ ‐ 77

Consolidated Interim Statements of Changes in Equity (cont.)

	Attributable to Company's shareholders
In NIS million	Share capital	Share premium		Translation reserve		Other capital reserves	Capital reserve from transactions with non controlling interests	Retained earnings	Total	Non controlling interests	Total equity
For the three-month period ended March 31, 2024 (unaudited)
Balance as of January 1, 2024		167	2,390		(2)	180	(39)	4,593	7,289	73	7,362
Income for the period		‐	‐		‐		‐	‐ 313	313	2	315
Other comprehensive income (loss) items:
Foreign currency translation differences in respect of foreign
operations carried to capital reserve		‐	‐		1		‐	‐	1 ‐	‐	1
Tax benefit for items of comprehensive income		‐	‐		‐		‐	‐	‐ ‐	‐	‐
Other comprehensive income for the period, net of tax		‐	‐		1		‐	‐	‐ 1	‐	1
Total comprehensive income for the period		‐	‐		1		‐	313 ‐	314	2	316
Transactions with shareholders carried directly to equity:
Issuance of share capital (less issuance expenses)		-	4		‐		‐	‐ (4)	-	‐	-
Balance as of March 31, 2024		167	2,394		(1)	180	(39)	4,902	7,603	75	7,678

Consolidated Interim Statements of Changes in Equity (cont.)

	Attributable to Company's shareholders
In NIS million	Share capital		Share premium	Translation reserve	Other capital reserves		Capital reserve from transactions with non controlling interests	Retained earnings		Total	Non controlling interests	Total equity
For the year ended December 31, 2024 (unaudited):
Balance as of January 1, 2024		167	2,390		(2)	180		(39)	4,593	7,289	73	7,362
Income for the period		‐	‐		‐	‐		‐	1,540	1,540	6	1,546
Other comprehensive income (loss) items:
Foreign currency translation differences in respect of foreign operations carried to capital reserve		‐	‐		(1)	‐		‐	‐	(1)	‐	(1)
Actuarial gains from a defined benefit plan		‐	‐		‐	‐		‐	1	1	‐	1
Tax benefit for items of comprehensive income		‐	‐		‐	‐		‐	‐	‐	‐	‐
Other comprehensive income for the period, net of tax		‐	‐		(1)	‐		‐	1	-	‐	-
Total comprehensive income for the period		‐	‐		(1)	‐		‐	1,541	1,540	6	1,546
Transactions with shareholders carried directly to equity:
Issuance of share capital		-	34		‐	‐		‐	(34)	-	‐	-
Share-based payments		‐	‐		‐	‐		‐	14	14	(1)	13
Dividend to shareholders		‐	-		‐	‐		‐	(100)	(100)	‐	(100)
Dividend to non-controlling interests		‐	‐		‐	‐		‐	‐	‐	(2)	(2)
Acquisition of non-controlling interests		‐	‐		‐	‐		(1)	‐	(1)		1 ‐
Balance as of December 31, 2024		167	2,423		(2)	180		(40)	6,014	8,742	76	8,818

Consolidated Interim Statements of Cash Flow

	For the three-month period ended March 31				For the year ended December 31
		2025	2024		2024
In NIS million	Appendix		Unaudited
Cash flows from operating activities
Before income tax	(a)	792	886		1,717
Income tax received (paid)		(105)	135		(117)
Net cash provided by (used in) operating activities		687	1,020		1,600
Cash flows provided by investing activities
Credit provided to card holders and merchants, net		(455)	(260)		(1,545)
Proceeds from the disposal of an investment in financial assets by
companies other than insurance and finance companies		46	973		990
Investment in financial assets by companies other than insurance and
finance companies		(2)	(27)		(97)
Dividend received from equity-accounted investees		1		‐	1
Investments in shares and loans in investees		‐		‐	(3)
Investment in fixed assets		(5)	(19)		(65)
Investment in intangible assets		(72)	(77)		(358)
Net cash used for investing activities		(487)	590		(1,078)
Cash flows provided by financing activities
Credit from banking corporations, net		(449)	(1,356)		(81)
Proceeds from the issue of subordinated notes and bonds (see Note 5)		154	556		1,017
Costs of issuing and exchanging subordinated notes and bonds		‐	(2)		(7)
Repayment of subordinated notes (See Note 5)		‐	(361)		(817)
Repayment of lease liability		(23)	(23)		(88)
Interest paid on bonds, subordinated notes, and credit from banking
corporations		(136)	(125)		(244)
Dividend paid		‐		‐	(102)
Net cash provided by financing activities		(453)	(1,310)		(322)
Effect of exchange rate fluctuations on balance of cash and cash equivalents		17	(8)		(98)
Net increase (decrease) in cash and cash equivalents		(236)	292		103
Cash and cash equivalents at the beginning of the period	(b)	7,069	6,966		6,966
Cash and cash equivalents at the end of the period	(c)	6,833	7,258		7,069

The attached notes to the consolidated interim financial statements are an integral part thereof

Consolidated Interim Statements of Cash Flow (cont.)

	For the three-month period ended March 31	For the year ended December 31
	2025	2024	2024
In NIS million		Unaudited
(a) Cash flows from operating activities before income tax ¹) ²)
Profit (loss) for the period	408	315	1,546
Items not involving cash flows
The Company's share in losses (profits) of equity-accounted investees	(4)	(2)	(14)
Dividend received from equity-accounted investees	‐		‐ ‐
Change in liabilities in respect of non-yield-dependent investment contracts	(3)	6	52
Change in liabilities in respect of yield-dependent investment contracts	(286)	(120)	(614)
Change in costs of obtaining investment management service contracts	(30)	(7)	(58)
Depreciation of property, plant, and equipment and right-of-use asset	29	33	131
Amortization of intangible assets	85	84	362
Credit loss expenses	46	41	216
Amortization of excess cost for credit card receivables	(7)	(28)	(63)
Impairment of intangible assets	‐		‐ 2
Loss (income) from a right-of-use asset	‐	1	1
Interest and linkage differentials accrued for subordinated notes and a lease liability	79	77	314
Accrued interest and revaluation of liabilities to banking and other corporations	115	103	549
Interest paid in Max	(132)	(100)	(456)
Change in fair value of investment property in respect of yield-dependent contracts	(6)	10	(6)
Changes in fair value of other investment property	(3)	3	8
Share-based payment transactions	3		‐ 13
Losses (gains), net on financial investments and derivatives for yield-dependent
contracts measured at fair value	72	(3,385)	(9,064)
Losses (gains), net on other financial investments and derivatives measured at
fair value	123	(587)	(1,290)
Losses (gains), net on other financial investments measured at amortized cost	45	40	(76)
Taxes (tax benefit) on income	197	165	739
Financial investments and investment property in respect of insurance contracts
and yield-dependent investment contracts:
Acquisition of investment property	(14)	(23)	(79)
Acquisitions of financial investments, net	2,664	1,101	4,070
Financial investments and other investment property:
Acquisition of investment property	(5)	(8)	(31)
Proceeds from sales (acquisitions), net of financial investments	(518)	(696)	(459)

1) Cash flows from operating activities include cash flows in respect of acquisition and sale of financial investments and investment property arising from insurance contracts and investment contracts activities.

2) Cash flows from operating activities include cash flows in respect of dividend and interest received, as described in Appendix D.

The attached notes to the consolidated interim financial statements are an integral part thereof.

	For the three-month		For the year ended
	period ended March 31		December 31
	2025	2024	2025
In NIS million		Unaudited
(a) Cash flows from operating activities before income tax (cont.)
Changes in other items in the statement of financial position, net
Securities held for trading by consolidated companies which are not
insurance companies	(18)	(9)	(24)
Receivables for credit card transactions, net	419	(552)	(1,371)
Receivables and debit balances	(912)	873	1,185
Reinsurance contract assets, net	56	(48)	(137)
Payables and credit balances	(19)	199	9
Payables for credit card transactions	226	983	1,616
Liabilities for insurance contracts, net	(1,819)	2,421	4,649
Liabilities for employee benefits, net	1	(1)	(3)
Total cash Flows from operating activities before income tax	792	886	1,717
(b) Cash and cash equivalents at the beginning of the period:
Cash and cash equivalents in respect of yield-dependent contracts	4,451	4,418	4,418
Other cash and cash equivalents	2,617	2,548	2,548
Balance of cash and cash equivalents at beginning of the period	7,069	6,966	6,966
(c) Cash and cash equivalents at end of the period:
Cash and cash equivalents in respect of yield-dependent contracts	4,985	5,025	4,451
Other cash and cash equivalents	1,848	2,233	2,617
Balance of cash and cash equivalents at end of period	6,833	7,258	7,069
(d) Cash flows for interest and dividend received, included in operating activity:
Interest received	242	408	2,096
Dividend received	130	160	720
Included in investing activity by Max:
Interest received	324	297	1,252
(e) Transactions not involving cash flows:
Payables - unpaid declared dividend	‐	‐	‐
Payables - purchase of insurance portfolios	‐	9	14
Replacement of notes	‐	187	187

Consolidated Interim Statements of Cash Flow (cont.)

The attached notes to the consolidated interim financial statements are an integral part thereof.

Notes to the Consolidated Interim Financial Statements

NOTE 1 - GENERAL

A. The reporting entity

Clal Insurance Enterprises Holdings Ltd. (hereinafter - the "Company") is an Israeli resident company incorporated in Israel, whose official address is 36 Raoul Wallenberg Street, Tel Aviv. The securities of the Company are listed for trading on the Tel Aviv Stock Exchange Ltd.

Clal Insurance Enterprises Holdings Ltd. (hereinafter - the "Company") is a holding company. Its main holdings are mainly in the insurance, pension, provident and finance domains, as well as in the credit card domain.

The consolidated financial statements as of March 31, 2025 (hereinafter - the "Financial Statements") include those of the Company and its subsidiaries (hereinafter, jointly - the "Group"), as well as the Group's interests in joint ventures and associates.

The Group operates mainly in the insurance and finance industries, including pension, provident and holding insurance agencies, as well as credit card transactions, which include issuance, acquiring and processing of debit cards, providing payments solutions and financial products, including credit to private and business customers.

For further details, see Note 1 to the Consolidated Financial Statements for 2024.

B. Below is a description of developments in the reporting period for the control of and holdings in the Company and in Clal Insurance

As of the report publication date, the Company does not have a control core.

Further to Note 1 to the Financial Statements for 2024, Alrov reported that, on May 27, 2025, the Commissioner had notified it of his intention to reject the application for a control permit over Clal Insurance filed on December 24, 2023, subject to allowing Alrov's to make its claims on the subject before the Commissioner. Alrov reported that it was studying the Commissioner's position, which it deems erroneous, and that it will consider its reaction in accordance with the law.

For further details, see Note 1 to the Financial Statements for 2024.

On April 1, 2025, the Knesset's Constitution, Law and Justice Committee passed the second and third readings of the Companies Law Bill (Amendment No. 37) (Corporate Governance in Public Companies without a Controlling Shareholder), 2023. The bill proposes to adjust the corporate governance rules that apply to companies without a controlling shareholder, in order to safeguard the interests of investors in such companies. Several changes have been made to the bill, such as revoking the prohibition on an independent director's affinity to any director. The law will come into force subject to regulations which will be brought for approval by the Committee, and in any case - not prior to July 2026, and in any case - transitional provisions will apply to serving directors.

To date, Clal Holdings and the Company are unable to assess the implications of the bill and the regulations which will be promulgated, to the extent that they are promulgated, and their effect, due to, among other things, the fact that strict provisions apply to Clal Holdings by virtue of its status as the controlling shareholder in an insurance company.

C. Implications

As of the reporting date, the Company is unable to assess the full effect of the outcomes of the events detailed above and in Note 1 to the Consolidated Financial Statements for 2024, among other things, due to the fact that the Company is the controlling shareholder of Clal Insurance and in view of the restrictions imposed under the Outline for Exercising Means Of Control in Clal Insurance, which significantly limit the extent of the Company's influence over the conduct of Clal Insurance and the appointment of officers in Clal, and the Company is still evaluating its implications and applicability over time. This uncertainty also applies in view of additional changes that are taking place in the Company and that may occur in the future, due to its holdings structure, the fact that it is a company without a control core with a substantial shareholder, and due to the fact that the provisions of the Supervision Law for insurers without a controlling shareholder do not apply to it, and due to the different corporate structure of the large insurance companies in Israel compared with the standard structure in banks, according to which the insurance companies, including Clal Insurance, are private companies which are controlled by a holding company, including the Company, which is a publicly-traded company without a control core, and due to the effective impact of the holders of non-controlling interests on the conduct of the Company under the above circumstances.

Furthermore, the set of changes and events described above and Note 1 to the Consolidated Financial Statements for 2024, if they continue, may and will affect, among other things, the reputation of the Company and the Group companies. It is noted that a future transfer of control of the Company to a third party may affect clauses in certain agreements of Group companies with third parties (including reinsurers) and may require, once circumstances involving such change of control exist, negotiations with such third parties for the agreements to remain in effect.

D. Definitions - In these financial statements:

The Group	- The Company and its consolidated companies.
Consolidated companies/ subsidiaries	- Companies, including a partnership, whose financial statements are fully consolidated, directly or indirectly, with the financial statements of the Company.
Investees	- Consolidated companies and companies, including a partnership or joint venture, the Company's investment in which is included, directly or indirectly, in the financial statements based on the equity method.
Joint arrangements	- Arrangements in which the Group has joint control which was achieved by a contractual agreement, which requires unanimous consent with regard to the activities that have a significant effect on the arrangement's returns. Investment in joint arrangements is classified as joint operations or joint ventures, based on the rights and obligations of the parties to the arrangement. Joint ventures are all joint arrangements, which are incorporated as a separate entity, where the Group has rights to the net assets of the joint arrangement.
Associates	- Associates are entities in which the Group has significant influence over the financial and operating policies, but is not a controlling shareholder therein, and the Company's investment in which is presented in the Company's consolidated financial statements based on the equity method.
Interested parties	- As defined in Section (1) of the definition of an "interested party" in a company in Section 1 of the Securities Law, 1968.
Related party	- As defined in IAS 24 (2009), Related Party Disclosures.
	The Commissioner - The Commissioner of the Capital Market, Insurance and Savings.
The Supervision Law	- Financial Services Supervision Law (Insurance), 1981 and amendments thereto.
Investment Rules Regulations	- Supervision of Financial Services Regulations (Provident Funds) (Investment Rules Applicable to Institutional Entities), 2012, and the Commissioner's guidance thereunder.
Economic Solvency Regime	- As defined in Insurance Circular 2017-1-9 and its amendments.
Yield-dependent contracts	- Insurance contracts and investment contracts in life and long-term care health insurance, in which the insurer's liabilities for the savings or risk component are mostly linked to the yields on the investment portfolio (participating policies), in assets for yield-dependent contracts.
Assets for yield dependent contracts	- Assets held against liabilities arising from yield-dependent contracts.
Designated / Hetz bonds	- CPI-linked government bonds, which the government issued to the insurance companies, and which back guaranteed return policies.
Premiums	- Premiums including fees and credit fees.

NOTE 2 - BASIS OF PREPARATION OF THE INTERIM FINANCIAL STATEMENTS

A. Financial reporting framework

The consolidated interim financial statements of the Group as of March 31, 2025 and the three-month period then ended, were prepared in accordance with the Securities Regulations (Periodic and Immediate Reports), 1970, which refer to holding companies of insurers and credit card companies.

Through December 31, 2022, the Group's consolidated financial statements were drawn up in accordance with International Financial Reporting Standards (IFRS) (hereinafter - "IFRS" or "International Financial Reporting Standards"), including in connection with the data relating to insurer consolidated subsidiaries, which meet the definition of insurer, as defined in the Securities Regulations (Preparation of Annual Financial Statements), 2010.

As detailed in Note 3 below, in accordance with requirements set by the Commissioner, the first-time application date of IFRS 17, Insurance Contracts and IFRS 9, Financial Instruments was postponed to January 1, 2025 (instead of the first-time application date which was set by the standard - January 1, 2023). Consequently, during the periods between January 1, 2023 and December 31, 2024, the Company continued to apply IFRS 4, Insurance Contracts, and IAS 39, Financial Instruments (issued in 2017), to the data in the Group's consolidated financial statements with respect to Clal Insurance, as aforesaid. In other matters, the Consolidated Financial Statements have been prepared in accordance with IFRSs.

Furthermore, on March 27, 2023, the Company completed the acquisition of CIMax Holdings Ltd. (hereinafter - "CIMax"), which consolidates in its financial statements the credit card company Max It Finance Ltd. (hereinafter - "Max"). In accordance with the Preparation of Financial Statements Regulations, the information in the Group's consolidated financial statements relating to Max from the completion date of the acquisition of CIMax was prepared in accordance with the guidelines and directives of the Banking Supervision Department; for further details, see Notes 3 below. These directives basically adopt the US GAAP.

In light of the above, as of January 1, 2023, the consolidated interim financial statements of the Company have been drawn up in accordance with the provisions of the Securities Regulations (Periodic and Immediate Reports), 1970. In accordance with these provisions, the financial statements data which relate to Clal Insurance - a consolidated company which falls within the definition of insurer, as defined in the Securities Regulations (Preparation of Annual Financial Statements), 2010, as well as a subsidiary which meets the definition of a credit card company, were prepared in accordance with the requirements set by the Commissioner in accordance with the Financial Services Supervision Law (Insurance), 1981.

As of January 1, 2025, the Group applies IFRS 17 and IFRS 9 for the first time to data in the financial statements which relate to the subsidiary as stated above; since the Group does adjust for data which relate to the subsidiary which meets the definition of insurer, the effects of the first-time application at the group level are in accordance with the effects of the first-time application to Clal Insurance. The effect of the transition to reporting in accordance with IFRS 17 and IFRS 9 on the Group's financial position and its operating results and cash flows with respect to the financial data relating to Clal Insurance is specified in Note 14 below.

The comparative figures for the year ended December 31, 2024 and for the three-month period ended March 31, 2024 were taken from the Company's Annual Financial Statements as of December 31, 2024 and the year ended on that date and notes attached thereto (hereinafter - the "Consolidated Interim Financial Statements") and from the Interim Consolidated Financial Statements as of March 31, 2024, respectively, except for the adjustments following the application of IFRS 17, Insurance Contracts, and IFRS 9, Financial Instruments, for Clal Insurance, which have been reviewed but not yet audited.

As stated, in light of the postponement of the application of IFRS 17 and IFRS 9, on January 1, 2025, the Group adopted the IFRSs for the first time with respect to a subsidiary which meets the definition of an insurer, with the transition date to reporting according to the IFRSs being January 1, 2024.

The accounting policies applied to the financial statements have been applied consistently across all the periods presented, unless stated otherwise.

The Condensed Consolidated Interim Financial Statements do not include all the information required in the full annual financial statements. They should be read together with the consolidated financial statements as of and for the year ended December 31, 2024 (hereinafter - the "Annual Financial Statements"). In addition, these reports have been prepared in accordance with the provisions of Chapter D of the Israel Securities Regulations (Periodic and Immediate Reports), 1970, insofar as these regulations apply to a corporation consolidating insurance companies and a credit card company.

The Condensed Consolidated Interim Financial Statements were approved for publication by the Company's Board of Directors on May 28, 2025.

B. Use of estimates and judgments

The preparation of the Group's said Condensed Interim Financial Statements requires that the Group's management use judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, revenues and expenses. It is clarified that the actual results may differ from those estimates.

Except for that which is detailed below and stated in Note 3A, the judgment of management, when applying the Group's accounting policies and the principal assumptions used in assessments that involve uncertainty, are consistent with those used in the annual financial statements. The estimates and their underlying assumptions are reviewed on an ongoing basis. Changes in accounting estimates are recognized in the period in which the estimates were adjusted and for any future affected period,

Changes in significant estimates and judgments made following the application of IFRS 17 and IFRS 9 in the subsidiary include the following:

Exercising judgment in analyzing the classification of insurance and reinsurance contracts for the purpose of determining whether they are insurance contracts, investment contracts or contracts that fall within the scope of other financial reporting standards, in accordance with the definitions of IFRS 17.
Use of estimates and significant judgment to determine actuarial assumptions, including: cancellations, mortality, longevity, morbidity and expenses, in order to measure certain insurance contract and investment contract liabilities.
The number of coverage units in a group is determined by estimating the scope of coverage provided by the group of contracts, taking into account the quantity of the benefits provided under a contract and its expected coverage duration.
In determining the discount rates and return assumptions for the cash flows to fulfil an insurance contract, the Company uses the bottom-up approach, which combines the risk-free interest rate curve and the illiquidity premium, using a methodology determined by the Commissioner. In assuming the yield for a policy portfolio which includes a yield-dependent savings component and variable management fees, the Company uses a stochastic model to assess the asymmetry value inherent in the management fee mechanism, using a large number of possible economic scenarios for market variables. This model is market consistent, calibrated on average to the regular riskfree interest rate curve. Volatility assumptions are determined taking into the accounts inputs of implied volatility in listed market instruments, if available, or are otherwise based on best estimates.
In determining the risk adjustment for non-financial risk, the Company is required to exercise significant judgment, including in assessing the diversification benefit, determining the appropriate confidence level and how to carry out the allocation between the portfolios and groups of insurance contracts.
The assessment of whether a contract or a group of contracts is onerous is based on expectations at initial recognition, while calculating expected cash flows based on probabilities and/or based on indicators determined by the Company indicating the existence of an onerous contract. The Company exercises judgment in determining the level of detail at which reasonable and supportable information is available for making such a decision.
With respect to contracts in the Life and Health Segments, excluding travel, issued in the periods prior to the IFRS 17 transition date, the Company has determined that the application of a full retrospective approach was impractical, due to information limitations and unreasonable costs – and has applied the alternative transitional approaches permitted under IFRS 17 – for more information, see Note 14 below.

C. Details of rates of change in the consumer price index and in the representative exchange rates of the EUR, USD, and GBP:

	Known CPI	EUR	USD representative exchange rate	GBP representative exchange rate	representative exchange rate
			%
For the three-month period ended
March 31, 2025	1.1	0.3	5.9	1.9	5.2
March 31, 2024	1.0	0.3	(0.8)	1.5	0.7
For the year ended December 31, 2024	3.2	3.4	(5.4)	0.6	(1.0)

	EUR representative exchange rate	USD representative exchange rate	GBP representative exchange rate
As of March 31, 2025	4.022	3.718	4.811
As of March 31, 2024	3.979	3.681	4.654
As of December 31, 2024	3.796	3.647	4.574

NOTE 3 - SIGNIFICANT ACCOUNTING POLICIES

Except as specified in Section A below, the Group's accounting policies in these Condensed Consolidated Interim Financial Statements are the same as the accounting policies applied to the Annual Financial Statements. Following is a description of the main changes to the accounting policy in these Condensed Consolidated Interim Financial Statements and their effect:

Initial application of new IFRSs and amendments to existing accounting standards by the Group companies, which implement IFRS and the directives of the Capital Market, Insurance and Savings Authority (see Note 2.A above)

(1) IFRS 17 - Insurance Contracts

The Group's first-time application date of IFRS 17 (hereinafter - "IFRS 17" or the "Standard") regarding insurance contracts, which superseded IFRS 4 - Insurance Contracts - was January 1, 2025.

As stated in Note 2.A above, in light of the postponement of the application of IFRS 17 and IFRS 9, the Group adopted the IFRSs for the first time on January 1, 2025, and the transition date to reporting in accordance with the IFRSs is January 1, 2024. The effect of the transition to IFRS reporting, including the effect of the application of IFRS 17 on the Group's financial position, operating results and cash flows is detailed in Note 14 below.

For the purpose of the preparations made by insurance companies in Israel for the adoption of IFRS 17, the Commissioner published an insurance circular entitled Professional Issues Pertaining to the Application of IFRS 17 in Israel (hereinafter - the "Professional Issues Circular"). The accounting policy chosen by the Company, which is described below, is based, among other things, on this circular.

Following are the main changes in the accounting policy chosen by the Company, following the application of the Standard as from January 1, 2024:

Classification of contracts

Insurance contracts

The Company identifies insurance contracts as contracts in which the Company accepts a significant insurance risk from another party (the policyholder) by agreeing to compensate the policyholder (or the beneficiary to the contract) for a specified uncertain future event (the insured event) which adversely affects the policyholder and the amount or timing of which is uncertain.

The Company determines whether an insurance contract contains a significant insurance risk if the insured event could cause the Company to pay the policyholder additional amounts that are significant in any single scenario with any commercial substance even if the occurrence of the insured event is highly unlikely, or even if the expected present value of the contingent cash flows is a small proportion of the expected present value of the remaining cash flows from the insurance contract. In making this assessment, the Company takes into account all of its actual substantive rights and obligations, whether arising from a contract, law or regulation. In addition to the significant insurance risk, some insurance contracts also transfer financial risk to the Company, such as a guaranteed rate of return.

Similarly to the accounting policy applied to the Financial Statements as of December 31, 2024, the Company chose to continue to account for Sale Law guarantee contracts as an insurance contract and "reverse mortgage" loans as financial instruments.

The Company does not issue reinsurance contracts nor does it issue investment contracts with discretionary participation features. Some of the contracts entered into by the Company have the legal form of an insurance contract but do not transfer a significant insurance risk (savings policies without insurance coverage). These contracts are classified as financial liabilities and referred to as 'investment contracts'.

Reinsurance contracts held

In addition, the Company enters into insurance risk transfer agreements, with the appropriate premiums, with one or more reinsurers. In the event that the reinsurers are unable to fulfill their obligations, the Company remains liable to its policyholders for the reinsured portion. These types of contracts are defined as reinsurance contracts held. The purpose of the reinsurance contracts held is to mitigate the Company's significant insurance risk in respect of the underlying insurance contracts.

Separating components from insurance contracts and reinsurance contracts

An insurance contract may contain one or more components, which would be within the scope of another standard if they were separate contracts. The Company has not identified components (such as: investment components, service components and embedded derivatives), which it is required to separate from its insurance contracts, and accordingly, it does not expect to separate from the insurance contracts components, which will fall within the scope of another standard.

Level of aggregation of insurance contracts

At initial recognition, the Company determines the level of the aggregation of insurance contracts issued by it by dividing the businesses into portfolios of insurance contracts and will not change the composition of the groups thereafter. A portfolio of insurance contracts includes groups of contracts with similar risks that are managed together. The Company has defined the portfolios of the insurance contracts issued based on its main product lines and subject to the Commissioner's guidance, as set out in the Professional Issues Circular. Following is the list of insurance contracts portfolios defined by the Company, by operating segment:

A. P&C Insurance

1. Business insurance: Property loss and comprehensive business insurance including liability and other riders, including employer liability insurance, product liability insurance and third-party insurance sold as a separate policy;
1. Comprehensive home insurance, including liability and other riders, including home insurance sold with respect to mortgage;
1. Compulsory motor, including policies sold through the Pool;
1. Motor property, including third party coverage only and other riders;
1. Professional liability insurance, including for board members and officers;
1. Aircraft, vessels and freight, including liability riders;
1. Engineering insurance, including liability riders;
1. Credit insurance measured using the Premium Allocation Approach;
1. Guarantees including a Sales Law guarantees.

B. Health Insurance

1. Individual long-term care;
1. Collective Long-Term Care;
1. Medical expenses and disabilities individual;
1. Medical expenses and disabilities collective, including dental;
1. Critical illness;
1. Travel abroad;
1. Personal accidents;

C. Life Insurance

1. Policies with a non-yield-dependent savings component;
1. Policies that include a yield-dependent savings component and include variable management fees;
1. Policies that include a yield-dependent savings component only include fixed management fees;
1. Annuity policies, including:
2. a) Immediate annuity policies issued after January 1, 2025;
3. b) Policies that include a savings component with a guaranteed annuity conversion factor issued to policyholders over the early retirement age (aged 60 and older) issued after January 1, 2025; and
4. c) Policies that include a yield-dependent savings component which do not include a guaranteed annuity conversion factor as of January 1, 2025, in the period following the annuity takeup date, if applicable after January 1, 2025.
1. Policies without a savings component life insurance coverage;
Policies without a savings component - Permanent health insurance coverage.

The insurance contract portfolios are then split into groups of contracts issued within an annual period (by calendar year) and profitability groups, as follows:

A group of contracts, which are onerous at initial recognition;
a group of the remaining contracts in the portfolio.

In addition, insurance contracts measured according to IFRS 17 using various measurement models, as explained below, (the General Measurement Model (the GMM Model), the Variable Fee Approach (the VFA Model) and the Premium Allocation Approach (the PAA Model)) will not be included in the same group of insurance contracts.

An insurance contract is onerous at the date of initial recognition if the fulfilment cash flows allocated to the contract determined on a probability-weighted basis are a net outflow. The Company's assessment of whether contracts are onerous is based on reasonable and supportable information.

In determining the groups of contracts, the Company chose to include in that group contracts where the practical ability of the Company to set prices or levels of benefits for a policy with different features is specifically limited by law or regulation. Accordingly, the Company opted to include the Company's relative share in compulsory motor insurance policies issued through the Pool in the same group as the ordinary compulsory motor insurance policies issued by the Company.

The Company determines the level of aggregation of reinsurance contracts held by dividing them into portfolios based on its main product lines, as similar as possible to the level of aggregation of insurance contracts issued by it. Some of the reinsurance contracts acquired provide coverage for underlying insurance contracts that are included in various insurance contract groups. However, the legal form of these contracts, as a single contract, reflects the nature of the Company's contractual rights and obligations, given that the various coverages of the contract expire at the same time and are not sold separately. As a result, the acquired reinsurance contract is not separated into separate insurance components relating to different basic groups. Reinsurance contract portfolios are then split into groups of contracts issued within an annual period (by calendar year).

Initial recognition

The Company recognizes a group of insurance contracts it issues from the earliest of the following:

The beginning of the coverage period of the group of contracts;
The date when the first payment from a policyholder in the group becomes due or, if there is no repayment date, when the first payment is received from the policyholder; or
For a group of onerous contracts, when the group becomes onerous if facts and circumstances indicate the existence of such a group.

A group of reinsurance contracts held will be recognized on the following dates:

Reinsurance contracts entered into by the Company which provide proportionate coverage at the beginning of the coverage period of the group of reinsurance contracts held or at the initial recognition of any underlying contract, whichever is the later; and
Other reinsurance contracts entered into by the Company: The beginning of the coverage period of the group of reinsurance contracts held. However, if the Company recognizes a group of onerous contracts of underlying insurance contracts at an earlier date, and the inception date of the relevant reinsurance contract is made prior to that earlier date, the group of reinsurance contracts is recognized at that earlier date; and
Reinsurance contracts acquired by the Company: The acquisition date.

Contract boundary

In measuring a group of insurance contracts and reinsurance contracts, the Company includes all future cash flows included within the contract boundary. Cash flows are within the boundary of an insurance contract if they arise from substantive rights and obligations (disregarding terms and conditions with no commercial substance) that exist during the reporting period in which the Company can compel the policyholder to pay the premiums (or in which it has an obligation to pay the reinsurer) or in which the Company as a substantive obligation to provide the policyholder with services (or to receive services from the reinsurer). A substantive obligation to provide insurance services ends when:

• The Company has the practical ability to reassess the risks of the particular policyholder and, as a result, can set a price or level of benefits that fully reflects those risks, or

Both of the following criteria are satisfied:
- The Company has the practical ability to reassess the risks of the portfolio of insurance contracts, which contains the contract and, as a result, can set a price or level of benefits that fully reflects the portfolio's risk; and
- The pricing of the premiums up to the date when the risks are reassessed does not take into account the risks that relate to periods after the reassessment date.

For reinsurance contracts held, a substantive obligation to receive services ends when the reinsurer has a practical ability to reassess the risk transferred to it, and as a result can set a price or level of benefits that fully reflect those risks, or when the reinsurer has a substantive right to terminate the contract. Reinsurance contract boundaries include both cash flows in respect of underlying insurance contracts which have already been issued and cash flows for underlying contracts which the Company expects to issue (and deliver to the reinsurer) in the contract period, if the Company and the reinsurer do not have the right to cancel or reprice the obligation to deliver these expected futures.

For insurance contracts with renewal periods, the Company assesses whether the premiums and related cash flows that arise from the renewed contract are within the boundary of the original contract. The pricing of renewals is determined by the Company after it has examined the risks of a policyholder's coverages and, based on the pricing of new contracts with equivalent risks, terms and conditions as of the renewal date. The Company reassesses the contract boundary of each group of insurance contracts at the end of each reporting period.

Liabilities or assets relating to expected premiums or expected claims outside the boundary of the insurance contract are not recognized - such amounts relate to future insurance contracts.

Measurement on initial recognition

IFRS 17 provides three measurement methods for insurance contracts:

The General Measurement Model (hereinafter the "GMM Model");
The Variable Fee Approach (hereinafter the "VFA Model");
The Premium Allocation Approach (hereinafter the "PAA Model").

1. The General Measurement Model (GMM)

The Company applies the GMM Model to all life and health insurance portfolios, except for life insurance policy portfolios that include a yield-dependent savings component, which are measured in accordance with the VFA Model and a travel policy portfolio measured in accordance with the PAA model.

Measurement at the initial recognition date

At initial recognition, the Company measures an insurance contract group as the total amount of cash flows for the fulfillment of a contract plus the contractual service margin (hereinafter - "CSM") (if any).

Fulfillment cash flows (hereinafter - "FCF")

Fulfilment cash flows include a probability-weighted estimate - the probabilities of future cash flows, discounted to reflect the time value of money and financial risks, plus risk adjustment for non-financial risk (hereinafter - "RA" or "risk adjustment").

The Company estimates future cash flows within the contract boundary by taking into account evidence of past events, current conditions and forecasts of future conditions in order to reflect market variables and non-market variables which affect the cash flow estimate. The estimated cash flows is based on the expected, probabilityweighted value, which reflects the average of the full range of possible outcomes except for the estimate of asymmetrical insurance liability flows (including imputation of future variable management fees) based on a stochastic model, and includes explicit risk adjustment for non-financial risk. The risk adjustment for non-financial risk represents the compensation which the Company requires for bearing the uncertainty about the amount and timing of the cash flows that arises from non-financial risk when fulfilling the insurance contracts.

The assumptions and estimates are reviewed in each reporting period to ensure they adequately reflect past conditions, and reflect current, past, and future conditions.

When estimating the fulfilment cash flows for a contract, the Company includes all cash flows directly relating to the fulfillment of insurance contracts within the contract boundary, including:

• Premiums, including premium adjustments and instalment premiums, from a policyholder;

Claim payments and benefits to or on behalf of a policyholder, including claims incurred but not enough reported (IBNER), claims incurred but not reported (IBNR), and any future claims relating to periods within the scope of the contract;
Payments to (or on behalf of) a policyholder resulting from derivatives, for example options and guarantees embedded in the contract, to the extent that those options and guarantees are not separated from the insurance contract (for example, the effect of the "deficit" in policies which include a yield dependent savings component and variable management fees, calculated by using the a stochastic model);
An allocation of insurance acquisition cash flows attributable to the portfolio to which the contract belongs, using a methodical and logical allocation basis.
Transaction-based taxes (such as payments to the National Insurance Institute and Karnit) that arise directly from existing insurance contracts, or that can be attributed to them on a reasonable and consistent basis (if any).
Potential cash inflows from recoveries (such as salvage and subrogation) on future claims covered by existing insurance contracts and, to the extent that they do not qualify for recognition as separate assets, potential cash inflows from recoveries on past claims;
Other fixed and variable expenses, including an allocation of fixed and variable overheads (such as the costs of accounting, human resources, IT, building depreciation, rent, and maintenance and utilities) directly attributable to fulfilling insurance contracts, using a reasonable and consistent basis;
Costs the Company will incur in making investment transactions and providing return services for investments to holders of life insurance policyholders which include savings components, yield-dependent permanent health insurance and long-term care policies with a fixed premium.
In accordance with the provisions of the Professional Issues Circular, the Company recognizes policy loans as a separate financial asset, rather than as part of the fulfilment cash flows of a contract within the boundary of the insurance contracts.

Contractual service margin (CSM)

The contractual service margin (CSM) for a group of insurance contracts represents the unearned profit the entity will recognize as it provides insurance contract services for these contracts in the future.

At initial recognition, the measurement of the contractual service margin or loss component is comprised on the following components:

Fulfilment cash flows of a contract on the date of initial recognition, including adjustment to reflect the time value of money and risk adjustment component (RA) for non-financial risk;
Any cash flows received or paid on the same date (such as, immediately received premium);
Derecognition of an asset for insurance acquisition cash flows; and
Derecognition of any other asset or liability previously recognized, in respect of cash flows relating to the group of insurance contracts.

If at the initial recognition date, the total amount of these components is a net inflow, the group of insurance contracts does not constitute an onerous group, and a contractual service margin measured as an amount equal to and inverse to the sum of those components is recognized, such that no profit is generated at the initial recognition date.

On the other hand, the total amount of these components is a net outflow, the group of insurance contracts constitutes an onerous group, and an immediate loss measured as a sum equal to and inverse to the sum of those components is recognized.

Discount and return rates

Estimates of future cash flows to fulfill insurance contracts are adjusted to reflect the time value of money and the financial risks related to those cash flows (if the financial risks are not included in the cash flow estimates).

The Company measures the time value of money using discount rates that are consistent with observable current market prices and which reflect the liquidity features of the insurance contracts. These discount rates exclude the effect of factors that influence such observable market prices but do not affect the future cash flows of the insurance contracts (for example, credit risk).

The Company applies the bottom-up approach for determining discount rates and return assumptions (if any), which is the default approach in accordance with the Professional Issues Circular published by the Commissioner. In this approach, the discount rate is obtained by adding the illiquidity premium (which reflects the liability's illiquidity) to the risk-free interest rate curve. The risk-free interest rate curve is based on yields to maturity of liquid

bonds of the Israeli government. The last liquid point is the 25th year. Beyond this point, the Company sets the risk-free interest rate curves by way of extrapolation - in accordance with the Smith-Wilson method - up to the ultimate forward rate, which is set at 60 years. The full illiquidity premium is set based on the average spread of the bonds included in the Tel-Bond 60 Index. This premium is added in full or in part to the risk-free interest rate curve in accordance with the illiquidity characteristics of the relevant cash flows, according to their weights with respect to the full illiquidity premium. The Company opted to use the default weights set by the Commissioner in the Professional Issues Circular.

Following are the interest rates, including the illiquidity premium with the appropriate weights, divided into main time bands, used by the Company to determine the discount rates and the return in measuring the insurance contracts and reinsurance contracts (the aggregation of portfolios is done in accordance with the illiquidity premium weights applied):

As of March 31, 2025
Year 1	3 years



2.45	2.39		2.55	2.61	2.66	2.74	2.83

component which include variable management

2.36	2.30		2.46	2.52	2.57	2.65	2.74


2.28	2.22		2.38	2.43	2.48	2.57	2.65

							2.61
	2.24	2.17		2.44 2.35 2.27 2.22 2.33	(%) 2.39	2.44	5 years 10 years 15 years 25 years 40 years 60 years 2.53

	As of March 31, 2024
	Year 1	3 years		5 years 10 years 15 years 25 years 40 years 60 years
				(%)
Policies with a non-yield-dependent savings
component and annuity policies
(weighted at 100%)	1.77	1.75	1.95	2.21	2.33	2.45	2.62	2.78
Policies that include a yield-dependent savings
component which include variable management
fees, individual long-term care and compulsory
motor (weighted at 80%)	1.67	1.65	1.85	2.10	2.22	2.35	2.52	2.67
Policies that include a yield-dependent savings
component which only include fixed
management fees (weighted at 60%)	1.56	1.54	1.74	2.00	2.12	2.25	2.42	2.57
Remaining insurance portfolios
(weighted at 50%)	1.51	1.49	1.69	1.95	2.07	2.19	2.36	2.52

	As of December 31, 2024
	Year 1	3 years			5 years 10 years 15 years 25 years 40 years 60 years
				(%)
Policies with a non-yield-dependent savings
component and annuity policies
(weighted at 100%)	2.12	2.18	2.25	2.38	2.42	2.47	2.60	2.73
Policies that include a yield-dependent savings
component which include variable management
fees, individual long-term care and compulsory
motor (weighted at 80%)	2.03	2.10	2.16	2.29	2.34	2.38	2.52	2.65
Policies that include a yield-dependent savings
component which only include fixed
management fees (weighted at 60%)	1.95	2.01	2.07	2.21	2.25	2.30	2.43	2.56
Remaining insurance portfolios
(weighted at 50%)	1.90	1.97	2.03	2.17	2.21	2.25	2.39	2.52
In %		March 31, 2025		March 31, 2024			December 31, 2024
Illiquidity premium rate			0.43			0.52		0.43

Risk adjustment (RA) in respect of non-financial risk

Risk adjustment - The RA reflects the compensation, which the Company demands for bearing the uncertainty regarding the amount and timing of the cash flows arising from non-financial risks. The assumptions regarding nonfinancial risks mainly include mortality, longevity, morbidity, lapse risk, and expense risk.

The purpose of the risk adjustment is to reflect the level of diversification benefit that the Company includes in setting the compensation it claims for bearing that risk as well as the Company's risk aversion level.

The non-financial risk margin is determined using the Value at Risk (VaR) technique, which reflects the expected loss due to the materialization of risks relevant to the risk features of the various coverages given a one-year horizon (similarly to the economic solvency regime) and a confidence interval (statistical confidence level) in accordance with the Commissioner's guidance. It is expected that the confidence interval, which was determined at the Company level, before the effect of the diversification benefits, is 75% except for a long-term care portfolio, for which a 90% rate was set due to its inherent risk features, in accordance with the Commissioner's guidance in the Professional Issues Circular.

For property and casualty insurance, the Company applies the "best practice" principles (with certain adjustments) to determine the non-financial risk margin before the effect of segment diversification.

In determining the non-financial risk margin at the portfolio level, the Company takes into account the diversification benefit between the Company's various portfolios and segments.

For reinsurance contracts held, the Company calculates the non-financial risk margin in the manner detailed above, on a gross (without the effect of reinsurance) and retention (after the effect of reinsurance) basis, and sets the nonfinancial risk margin transferred to the reinsurer as the amount of the difference between gross and retention as detailed above.

Insurance acquisition cash flows

Insurance acquisition cash flows are cash flows arising from the costs of selling, underwriting and starting a group of insurance contracts which were issued or are expected to be issued (including future insurance contracts or renewals of existing insurance contracts which are outside the contract boundary) that are directly attributable to the portfolio of insurance contracts to which the group belongs.

The Company methodically attributes the insurance acquisition cash flows that are directly attributable to groups of insurance contracts within the portfolio.

Subsequent measurement

The carrying amount of a group of insurance contracts at each reporting period is the sum total of the liability for remaining coverage and liability for incurred claims.

• The liability for remaining coverage comprising: the fulfilment cash flows related to future service allocated to the group at that date and the remaining contractual service margin of the group at that date.

• The liability for incurred claims, comprising the fulfilment cash flows related to past service, including cash flows related to known claims which have yet to be paid (payable claims), claims incurred but not enough reported (IBNER) and claims incurred but not reported (IBNR).

Fulfilment cash flows for insurance contracts groups are measured at the reporting date using current estimates of future cash flows, current discount rates and current estimates of the risk adjustment for non-financial risk.

Subsequent measurement of CSM under the GMM model

For a group of insurance contracts, the carrying amount of the contractual service margin (CSM) of a group of contracts at the end of the reporting period equals the carrying amount at the start of the reporting period adjusted for:

Effect of any new contracts added to the group during the Reporting Period;
Interest accreted on the carrying amount of the contractual service margin during the reporting period, measured at nominal discount rates which were locked in initial recognition date
The changes in fulfilment cash flows relating to future service (as detailed below), measured using real discount rates locked in at initial recognition date, excluding cases in which:
- The increase in the fulfilment cash flows (paid, net) exceeds the carrying amount of the contractual service margin, giving rise to a loss, which is immediately recognized in profit or loss against a loss component; or
- The decrease in the fulfilment cash flows is allocated to the loss component of the liability for remaining coverage applying against recognition of an immediate profit (reversal of a loss previously recognized) in profit or loss.
The amount recognized as insurance revenues during the Reporting Period because of the transfer of services in the period (current amortization), determined by the allocation of the contractual service margin remaining at the end of the reporting period (before any allocation) over the current and remaining coverage period.

The changes in the fulfilment cash flows relating to future service that adjust the contractual service margin include the following:

Experience adjustments arising from premiums received in the period and that relate to future service, and related cash flows relating to future service;
Changes in estimates of the present value of the future cash flows in the liability for remaining coverage that do not arise from a financial risk or changes in financial risk;
Differences between any investment component expected to become payable in the period and the actual investment component that becomes payable in the period. This adjustment is calculated by comparing the actual investment component paid, to the expected payment plus insurance finance income or expenses relating to this expected payment before it became payable;
Changes in the risk adjustment for non-financial risk that relate to future service.

Changes in fulfilment cash flows relating to current services or recognized past service in the income statement as part of the insurance services expenses. Changes relating to the effects of the time value of money and financial risks are recognized as 'net finance expenses (income) arising from insurance contracts'.

When measuring the fulfillment cash flows, changes relating to future services are measured using current discount rates, but the CSM is adjusted to reflect these changes using the discount rates set in the initial recognition. The implementation of the two different interest rates generates a profit or loss, which is recognized under insurance finance income or expenses.

2. Variable fee approach - the VFA model

This model is a modification of the GMM model and applies to contracts with direct participation features. Insurance contracts with direct participation features are insurance contracts under which the Company promises an investment return to the policyholder based on underlying items. That is to say, the contract includes a significant service associated with investments.

The Company applies the VFA Model to all life insurance policy portfolios that include a yield-dependent savings component in that they have direct participation features that provide the policyholder with a substantial share of the fair value returns on a clearly identified asset portfolio (underlying items).

Reinsurance contracts held by the Company do not qualify for measurement using the VFA model, in accordance with the standard's provisions.

Initial recognition

The Company recognizes an insurance contract according to the Variable Fee Approach (VFA) if at the initial recognition date, it meets all of the following conditions (cumulatively):

The contractual terms specify that the policyholder participates in a share of a clearly identified pool of underlying items;
The Company expects to pay to the policyholder an amount equal to a substantial share of the fair value returns on the underlying items; and
The Company expects a substantial proportion of any change in the amounts paid to the policyholder to vary with the change in fair value of the underlying items.

The conditions for classifying insurance contracts to the VFA model is carried out at the initial recognition date, and no reassessment is carried out thereafter (except in cases of a material contract modification that results in the derecognition of the original contract).

Measurement on initial recognition

At initial recognition, the liability for insurance contracts in the VFA model is measured according to the principles of the GMM Model.

Subsequent measurement

For a group of insurance contracts measured according to the VFA Model, the carrying amount of the contractual service margin (CSM) of a group of contracts at the end of the reporting period equals the carrying amount at the start of the reporting period adjusted for:

Effect of any new contracts added to the group during the Reporting Period;
The change in the amount of the Company's share in the fair value of the underlying items, unless the decrease in the amount of the Company's share in the fair value of the underlying items exceeds the carrying value of the contractual service margin resulting in a loss, or, where applicable, the amount is first charged to the reversal of the loss component, excluding the effect of the application of the 'mitigating risk' alternative;
Changes in the fulfilment cash flows relating to future service, unless such increases make the contract onerous or, where applicable, the amount is first credited to the reversal of the loss component, excluding the effect of the application of the 'mitigating risk' alternative;
The amount recognized as insurance revenues during the Reporting Period because of the transfer of services in the period (current amortization), determined by the allocation of the contractual service margin remaining at the end of the reporting period (before any allocation) over the current and remaining coverage period.

Risk mitigation

Under the management of its business and the Commissioner's guidance, the Company is required to manage investment portfolios of assets held for yield-dependent insurance policies. Under such portfolios, the Company may actually hold financial assets, whose total amount exceeds the nominal aggregate value of the yielddependent policies accounted for by the VFA approach, in order to hedge the effects of additional financial exposures arising from those policies, including with regard to the effect of guaranteed annuity conversion factors, all in accordance with the Company's objective and risk mitigation strategy.

The Company opted to apply the risk mitigation alternative to changes in the cash flows for the performance of a contract arising from changes in the time value of money and financial risks in the relevant insurance liabilities, which are hedged through those assets. Therefore, the aforementioned changes will be recognized in profit or loss under the "Net finance expenses (income) from insurance contracts' concurrently with the income or expenses, which will arise in respect of the abovementioned assets. It is noted that the Company assesses and may periodically assess the amount of excess assets under management be held in practice under the participating portfolio in order to hedge the yield-dependent liabilities, if any.

3. Premium allocation approach - the PAA model

The Company applies the PAA Model to all P&C insurance contracts and travel insurance contracts. The Premium Allocation Approach constitutes an optional approach for measuring the liability for the remaining coverage (LRC) in relation to the general model, insofar as the contracts have a coverage period of one year or less or the Company expects that such simplification will not lead to a measurement of the liability for remaining coverage that is materially different than the general model.

The conditions for classifying insurance contracts to the PAA model is carried out at the initial recognition date, and no reassessment is carried out thereafter (except in cases of a material contract modification that results in the derecognition of the original contract).

Measurement on initial recognition

At initial recognition, the liability for the remaining coverage (LRC) is measured as the sum of the premiums received at initial recognition, less cash flows for any insurance acquisition cash flows (unless recognized as an immediate expense), plus or net of any amount resulting from the derecognition at that date of an insurance acquisition cash flows asset plus or minus any other asset or liability previously recognized in respect of cash flows relating to a group of contracts.

The Company chose to recognize the insurance acquisition cash flows incurred as an adjustment for the liability for the remaining coverage rather than as an immediate expense, except in respect of the portfolios included in Clal Credit Insurance.

The Company chose not to adjust the carrying amount of the liability for the remaining coverage in order to reflect the time value of money and the effect of the financial risk if, upon initial recognition, the Company expects that the period between the provision of any part of the services and the repayment date of the related premium does not exceed one year or if the period exceeds one year, but the insurance contracts do not have a significant financing component.

Subsequent measurement

At the end of each reporting period, the Company measures the liability for the remaining coverage for contracts measured in accordance with the Premium Allocation Approach as the carrying value of the liability for the remaining coverage at the beginning of the period, adjusted for the following:

Plus premiums received during the period;
Net of insurance acquisition cash flows incurred during the period that were not recognized as an immediate expense;
Plus any amounts relating to the derecognition of insurance acquisition cash flows recognized as an expense in the reporting period;
Minus the amount recognized as insurance revenues in respect of services provided during the period; and
Minus any investment component which was paid or carried to a liability for incurred claims.

If at any time during the coverage period, facts and circumstances indicate that a group of insurance contracts accounted for under the Premium Allocation Approach is onerous, the Company recognizes an immediate loss in the statement of income against an increase in the liability for the remaining coverage as the amount of the difference between the carrying amount of the liability for the remaining coverage in accordance with the principles of the PAA Model and the fulfilment cash flows relating to the remaining coverage of the group, in applying the principles of the GMM model.

The liability for incurred claims is calculated in accordance with the same principles as those used in the GMM model. With regard to future cash flows in the framework of incurred claims that are expected to be paid or received within a year or less from the date on which the claims were incurred, the Company chose to adjust these cash flows for the time value of money and for the effect of the financial risk.

Reinsurance contracts held

General Measurement Model (GMM)

The accounting policy used to measure a group of insurance contracts under the General Measurement Model (GMM) applies to the measurement of a group of reinsurance contracts held measured according to the GMM model, using the following adjustments:

At each reporting date, the carrying amount of a group of reinsurance contracts held is the amount of the remaining coverage component and incurred claims component. The remaining coverage component includes the remaining fulfilment cash flows relating to services received under the reinsurance contracts held in future periods as well as the remaining contractual service margin.

In measuring the estimates of the present value of the future cash flows for a group of reinsurance contracts held, the Company makes use of assumptions consistent with those used to measure the present value of the future cash flows for the group (or groups) of the underlying insurance contracts.

The risk adjustment for non-financial risk represents the amount of risk that the Company transfers to the reinsurer.

At initial recognition, the contractual service margin of a group of reinsurance contracts held reflects a net cost (asset) or net income (liability) in reinsurance acquisition. The contractual service margin is recognized on the date of initial recognition in an amount equal and inverse to the total fulfilment cash flows, net of the amount derecognized on that date of any asset or any liability previously recognized in respect of cash flows relating to a group of reinsurance contracts held, plus or minus any cash flows arising on that date as well as any income recognized in profit or loss due to a loss recognized with respect to onerous underlying insurance contracts recognized on that date.

The Company adjusts the carrying value of the contractual service margin of a group of reinsurance contracts held to reflect changes in the fulfilment cash flows, in accordance with the same principles as issued insurance contracts, except when the underlying insurance contracts are onerous and the changes in the fulfilment cash flows for the underlying insurance contracts are recognized in profit or loss by adjusting the loss component. In this case, the corresponding changes in the reinsurance contracts held are also recognized in the profit or loss (by adjusting the loss recovery component).

Deposits held by the Company under the reinsurance contracts held, constitute part of the carrying value of the assets for reinsurance contracts held.

Premium Allocation Access

Subject to the conditions for applying the PAA Model (as detailed above), the Company applies the PAA Model for all reinsurance contracts held for which the relating underlying insurance contracts are also measured according to the PAA Model, as well as for catastrophe reinsurance contracts in the Life and Health Segments.

Onerous underlying insurance contracts

The Company adjusts the contractual service margin of a group of reinsurance contracts held measured in accordance with the GMM Model or the carrying value of the asset for the remaining coverage of a group of reinsurance contracts held measured in accordance with the PAA Model, and as a result - recognizes revenue, with the entity recognizing a loss on initial recognition of an onerous group of underlying insurance contracts or when adding onerous underlying insurance contracts to the group, if the Company has entered into the relating reinsurance contract held before or at the same time as the onerous underlying insurance contracts are recognized.

The amount of the adjustment to the contractual service margin or carrying value of the asset for the remaining coverage is determined by multiplying the loss recognized in respect of the underlying insurance contracts by the rate of recovery in respect of the underlying insurance contracts that the Company expects to recover from the group of reinsurance contracts held. The amount of the adjustment shall not exceed the portion of the carrying value of the loss component of the onerous group of underlying insurance contracts that the Company expects to recover from the group of reinsurance contracts held.

The loss recovery component is created or adjusted for a group of reinsurance contracts held to reflect the adjustment to the contractual service margin or the carrying value of the asset for the remaining coverage, as applicable. The loss recovery component determines the amounts presented in subsequent periods in the statement of income as the reversal of losses from reinsurance contracts held and as a result - they are excluded from the allocation of premiums paid to the reinsurer under reinsurance expenses.

The coverage units and the manner of releasing the contractual service margin (CSM)

The contractual service margin (CSM) is a component of a group of insurance contracts measured under the GMM Model and the VFA Model representing the expected unearned profit that the Company will recognize when it provides insurance contract services under these contracts. Insurance contract services provided by the Company include insurance coverages, return on investment services for certain GMM contracts, and a service relating to investment in VFA contracts.

An amount from the contractual service margin of a group of insurance contracts is recognized in the statement of income as revenues from insurance services over the coverage period by allocating the remaining contractual service margin at the end of the reporting period (prior to the release to profit or loss) in a format that reflects the insurance contract services provided by the Company in connection with those contracts. This pattern is determined based on the coverage units, which were provided during the period compared to the coverage units, which are expected to be provided in the future. The number of coverage units in a group is the quantity of coverage services provided by the contracts in the group, determined by considering for each contract the quantity of the benefits provided under a contract and its expected coverage period.

The following are the coverage units used to release the contractual service margin of the main portfolios:

Type of coverage Non yield-dependent savings component (guaranteed) Yield-dependent savings component (participating)	Coverage units - Accrual and annuities - Accrual and annuities
Life insurance Permanent health insurance	- Insurance amount (amount at risk) - Insurance amount (monthly compensation amount multiplied by duration)
Individual and collective long-term care	- Insurance amount (monthly compensation amount multiplied by duration)
Medical expenses - private individual	- No. of coverages
Medical expenses - collective	- No. of coverages
Critical illnesses	- Insurance amount (amount at risk)
Personal accidents	- Insurance amount (amount at risk)

Coverage units are adjusted for survivability effect.

When a group of insurance contracts includes several types of insurance coverages and/or investment services, the Company weighs the different insurance units on the basis of the expected amount of benefits for the policyholder from each type of coverage or service.

The coverage units for reinsurance contracts held are consistent with the coverage units for the underlying contracts, according to the proportion transferred to the reinsurer, with adjustments in respect of the differences in the services provided.

For the purpose of allocating the contractual service margin to the coverage units, the Company opted to discount the coverage units.

Presentation

The Company presents separately in the statement of financial position the balances of insurance contract portfolios which constitute assets, and the balances of insurance contract portfolios which constitute liabilities, portfolios of reinsurance contracts which constitute assets and portfolios of reinsurance contracts held which constitute liabilities. In addition, the Company presents separately in the income statement revenues from insurance services, expenses from insurance services, reinsurance expenses, reinsurance revenues, financing income or financing expenses arising from insurance contracts and financing expenses or financing income arising from reinsurance contracts.

Insurance service results

The Company's revenues from insurance services describe the provision of insurance services in a period that reflects the consideration that the Company expects to be entitled to in exchange for those services. The consideration recognized as revenues from insurance services constitutes the amount of premiums paid to the Company, adjusted for the effect of financing and net of any non-distinct investment components.

Non-distinct investment components which were not separated from existing insurance contracts - mainly in life insurance policies which include a savings component - represent the amounts that the Company will reimburse the policyholder under any scenario, regardless of whether an insured event had occurred, rather than amounts received in return for the provision of the insurance services, and therefore these amounts are not included either in the revenues from insurance services for the consideration received for the services provided nor in the expenses from the insurance services for the claims and expenses paid.

Revenues from insurance services from contracts measured in accordance with the GMM and VFA Model are calculated on the basis of the amount of all changes in the liability for the remaining coverage relating to the services provided during the period for which the Company expects to receive consideration, plus an allocation of the premium amount relating to the recovery of insurance acquisition cash flows for the reporting period. The Company has chosen to carry out the allocation in accordance with the same coverage units used to release the contractual service margin.

Revenues from insurance services from contracts measured in accordance with the PAA Model, including allocation of the amount of premiums relating to the recovery of insurance acquisition cash flows, are recognized based on the passage of time.

Insurance service expenses arising from insurance contracts are generally recognized in profit or loss as incurred and do not include repayments of investment components. Expenses from insurance services include:

(a) Claims and other insurance service expenses incurred;
(b) Losses and reversal of losses for groups of onerous insurance contracts
(c) Adjustment for liabilities for incurred claims (LIC);
(d) Amortization of insurance acquisition cash flows;

Finance income or finance expenses from insurance contracts

Finance income or expenses from insurance consist of the change in the carrying value of the group of insurance contracts arising from:

The effect of the time value of money and changes therein;
The effect of financial risk and changes therein.

These effects also include the changes in the fair value of underlying items (FVUIs) relating to insurance contracts measured in accordance with the VFA Model as well as the effects of applying the 'risk mitigation' alternative.

The Company has chosen to recognize all financing revenues or expenses from insurance contracts in profit or loss.

The Company has chosen to split the change in risk adjustment for non-financial risk (RA) between the results of insurance services and finance income or finance expenses from insurance.

Net revenue or expense from reinsurance contracts held

The Company presents separately in the consolidated statements of income the amounts that are expected to be recovered from the reinsurers, and the allocation of reinsurance premiums paid. The Company considers reinsurance cash flows dependent on claims for the underlying contracts as part of the claims expected to be recovered under a reinsurance contract held, excluding investment components and fees and commissions from the allocation of reinsurance premiums presented in the consolidated income statements. Amounts relating to recovery of losses related to reinsurance for onerous underlying contracts are included as amounts recoverable from the reinsurer.

Amendment and derecognition of insurance contracts

Amending an insurance contract

When the terms and conditions of the insurance contracts are amended, the Company examines whether the amendment is substantial enough to lead to the derecognition of the original contract and recognition of the amended contract as a new contract. Exercising a right included in the terms and conditions of the original contract does not constitute an amendment. If the amendment of the contract does not lead to derecognition and recognition of a new contract, the effect of the amendment is treated as an change in the estimate of the fulfilment cash flows, recognized as an experience adjustment of the original contract.

Derecognition of an insurance contract

The Company derecognizes an insurance contract when it is settled, i.e. when the obligations specified in the insurance contract expire, are repaid or terminated, or when a substantial contract amendment is made.

When an insurance contract, which is not measured in accordance with the Premium Allocation Approach is derecognized from a group of insurance contracts:

The fulfilment cash flows allocated to the Group are adjusted in order to cancel those relating to the rights and obligations derecognized from the Group;
The Group's contractual service margin is adjusted for the change in fulfilment cash flows, unless the change is allocated to a loss component; and
The number of coverage units for the expected remaining insurance contract services is adjusted to reflect the coverage units that were derecognized from the group.

If a contract is derecognized because it has been transferred to a third party, the contractual service margin of the group from which the contract is derecognized is adjusted for the difference between the change in fulfilment cash flows of the insurance contract group as a result of the contract being derecognized and the premium charged by a third party. If the said difference amount is greater than the remaining contractual service margin, it will be recognized as an immediate loss in the Statement of Income.

If a contract is derecognized due to a significant contract amendment, the contractual service margin of the group from which the contract is derecognized is adjusted for the difference between the change in cash flows to the existence of the contract of the insurance contract group as a result of the contract being derecognized and a theoretical premium that the Company would have charged if it had entered into a contract with terms equivalent

to the new contract at the time of the contract amendment, less any additional premium charged for the amendment. If the said difference amount is greater than the remaining contractual service margin, it will be recognized as an immediate loss in the Statement of Income.

When an insurance contract measured according to the Premium Allocation Approach is derecognized, adjustments to the fulfilment cash flows in order to cancel those relating to the rights and obligations derecognized from the group and the treatment of the effect of the derecognition results in the following amounts being immediately recognized in the income statement:

If the contract is settled, the entire net difference between the portion derecognized from the liability for the remaining coverage relating to the original contract and any additional cash flows arising from the settlement of the contract; and
If the contract is transferred to a third party, the entire difference between the portion derecognized from the obligation for the remaining coverage relating to the original contract and the premium charged by a third party.

(2) IFRS 9, Financial Instruments (2014)

As from the first quarter of 2025, the Group applies IFRS 9, Financial Instruments (2014) (hereinafter - the "Standard" or "IFRS 9"), which supersedes IFRS 39, Financial Instruments: Recognition and Measurement (hereinafter - "IAS 39").

As stated in Note 2.A above, in light of the postponement of the application of IFRS 17 and IFRS 9, the Group adopted the IFRSs for the first time on January 1, 2025, and the transition date to reporting in accordance with the IFRSs is January 1, 2024. The effect of the transition to IFRS reporting, including the effect of the application of IFRS 9 on the Group's financial position, operating results and cash flows is detailed in Note 14 below.

Following are the main changes in the accounting policy following the application of the Standard as from January 1, 2024:

Financial assets - Classification and measurement of financial assets and financial liabilities

Initial recognition and measurement of financial assets

The Group initially recognizes debt instruments as they are incurred. All other financial assets are initially recognized on the date when the Group becomes party to the contractual terms of the instrument.

A financial asset is initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue are not attributed to the financial asset and recognized in profit and loss.

Derecognition of financial assets

Financial assets are derecognized when the contractual rights of the Group to the cash flows from the asset expire, or the Group transfers the rights to receive the contractual cash flows arising from the financial asset in a transaction in which substantially all the risks and rewards of ownership of the financial asset have been substantively transferred.

If the Group is essentially left with the risks and rewards of ownership of the financial asset, the Group continues to recognize the financial asset.

Financial assets - Classification of financial assets into groups and the accounting treatment of each group

At initial recognition, financial assets are classified to one of the following measurement categories: Amortized cost or fair value through profit and loss; financial assets are not reclassified in subsequent periods unless, and only if, the Group changes its business model for management of financial debt assets, in which case the affected financial debt assets are reclassified at the beginning of the reporting period subsequent to the business model change.

A financial asset is measured at amortized cost if it meets both of the following two conditions cumulatively and is not designated for measurement at fair value through profit and loss:

a) The financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows; and
b) The contractual terms and conditions of the financial asset provide entitlement, at specified dates, to cash flows that are only principal and interest payments in respect of the outstanding principal amount (hereinafter - the "Principal and Interest Test").

Classification and measurement

All financial assets that are not classified for measurement at amortized cost as described above, as well as financial assets designated at fair value through profit and loss, are measured at fair value through profit and loss. At initial recognition, the Group designates financial assets at fair value through profit and loss when such designation reverses or significantly reduces the accounting mismatch.

The Group designated to a category of fair value through profit or loss all financial assets except for non-yielddependent investment contracts. In this context, credit facilities provided by the Group (which constitute the Group's obligations to provide loans) relating to the aforementioned financial asset portfolios are also measured at fair value through profit or loss.

The Group has other accounts receivable balances (which essentially do not constitute investment assets) held within a business model aimed at collecting contractual cash flows. The contractual cash flows in respect of such financial assets include only principal and interest payments that reflect consideration for the time value of money and the credit risk. Accordingly, such financial assets are measured at amortized cost.

Financial assets - Subsequent measurement and gains and losses

Financial assets at fair value through profit and loss

In subsequent periods, such assets are measured at fair value. Net gains and losses, including interest revenues or dividends, are recognized in profit and loss (excluding certain derivative instruments designated as hedging instruments).

Financial assets at amortized cost

These assets are measured in subsequent periods at amortized cost using the effective interest method net of impairment losses. Interest revenues, profits or losses on exchange rate differentials and impairment are recognized in profit and loss. Any profit or loss from derecognition is also recognized in profit and loss.

Non-derivative financial liabilities - classification, subsequent measurement, and gains and losses

Non-derivative financial liabilities include: Overdrafts from banks, loans and credit from banking corporations and other lenders, bonds and subordinated notes, lease liabilities, trade payables and other payables.

Non-derivative financial liabilities - initial recognition

The Group initially recognizes debt instruments as they are incurred. Other financial liabilities are initially recognized at the trade date when the Group becomes party to the contractual provisions of the instrument.

Non-derivative financial liabilities - subsequent measurement

Financial liabilities (excluding financial liabilities designated at fair value through profit and loss) are initially recognized at fair value net of any attributable transaction costs. Subsequent to initial recognition, financial liabilities are measured at amortized cost using the effective interest method. Financial liabilities are designated at fair value through profit and loss, if the Group manages these liabilities and their performance is assessed based on their fair value, depending on how the Group has documented their risk management, if the designation is designed to prevent an accounting mismatch or if it is a hybrid financial instrument that includes an embedded derivative.

Transaction costs that are directly attributed to an expected issuance of an instrument which will be classified as a financial liability are recognized as an asset under the deferred expenses line item in the statement of financial position. These transaction costs are deducted from the financial liability upon initial recognition thereof, or amortized as finance expenses in the statement of income, when it is no longer expected that the issuance will take place.

Derecognition of financial liabilities

Financial liabilities are derecognized when the contractual obligation of the Group expires or when it is discharged or canceled.

Material changes in terms of a debt instrument

An exchange of debt instruments having substantially different terms are accounted for as an extinguishment of the original financial liability and the recognition of a new financial liability. In addition, a significant amendment of the terms of an existing financial liability, or an exchange of debt instruments having substantially different terms between an existing borrower and lender, are accounted for as an extinguishment of the original financial liability and a recognition of a new financial liability at fair value.

In such a case, the entire difference between the amortized cost of the original financial liability and the fair value of the new financial liability is recognized in profit and loss in the finance income or expenses line item.

The terms and conditions are substantively different if the discounted present value of the cash flows according to the new terms and conditions, including any fees and commissions paid, less any fees and commissions received and discounted using the original effective interest rate, is different by at least ten percent from the discounted present value of the remaining cash flows of the original financial liability.

In addition to the quantitative test described above, the Group assesses, among other things, whether changes took place in connection with various economic parameters embodied in the exchanged debt instruments. Therefore, as a rule, exchanges of linked debt instruments with non-linked instruments are considered as exchanges with substantially different terms even if they do not meet the quantitative test performed above.

When exchanging debt instruments with capital instruments, equity instruments issued when extinguishing and derecognizing the liability, in whole or in part, are considered part of the "consideration paid" for the purpose of calculating profit or loss from the derecognition of the financial liability.

The equity instruments are initially measured at fair value, unless the value cannot be reliably measured - in the latter case, the issued instruments are measured according to the fair value of the derecognized liability. Any difference between the amortized cost of the financial liability and the initial measurement of the equity instruments is recognized in the income statement under the finance income or expenses.

Non-substantial modification in terms of a debt instrument

In a non-substantial modification in terms (or exchange) of A debt instrument, the new cash flows are discounted using the original effective interest rate, and the difference between the present value of the new financial liability and the present value of the original financial liability is recognized in profit and loss.

Impairment of financial assets

At each reporting date, the Company shall test the provision for loss in respect of financial debt instruments that are not measured at fair value through profit or loss should be estimated.

The Company shall differentiate between two situations of recognition of a provision for loss:

a) Debt instruments with no significant impairment in credit quality since the initial recognition date or with a low credit risk - the provision for loss recognized for this debt instrument will take into account current expected credit losses in the 12 months period after the reporting date; or
b) debt instruments with significant deterioration in credit quality since the initial recognition date and their credit risk is not low, the provision for loss recognized will take into account the expected credit losses - over the balance of the useful life of the instrument. The will apply Company the expedient, according to which it shall assume that the credit risk of a debt instrument has not increased significantly since its initial recognition date, if it is determined, at the reporting date, that the instrument has low credit risk, for example - if the instrument has an external "investment grade" rating.

Impairment in respect of debt instruments measured at amortized cost is recognized in profit or loss against a provision for impairment.

As stated above, due to the fact that in the transition to IFRS 9 most of the Company's financial assets will be classified to fair value through profit or loss, the amount of the provision for credit losses is expected to be immaterial.

B. First-time application of new financial reporting standards and amendments to existing accounting standards in the credit card company - Max

As of the reporting periods commencing on January 1, 2025, Max applies the following ASUs and Banking Supervision Department directives:

(1) ASU 2023-07, Improvements to Reportable Segment Disclosures

On November 27, 2023, the Financial Accounting Standards Board (FASB) published ASU 2023-07, Improvements to Reportable Segment Disclosures (hereinafter - the "ASU"). The ASU improves the disclosure requirements, including:

Addition of a requirement to disclose 'significant expenses' reported to the CODM and included within the reported profit; the disclosure will be made in a separate line in the note.
Disclosure regarding the amount and composition of 'other segment items' included in adjustments to the reported segment profit.
Explanation of how the CODM uses the reported profit to assess performance and allocate resources to the segment.
Disclosure of the CODM's identity and position.
Further clarifications regarding single reportable segment entities and disclosures in interim financial statements.

The provisions of the ASU were applies as from the Financial Statements as of December 31, 2024.

(2) Circular No. H-06-2798 of the Banking Supervision Department, "Disclosure of Interest Rate Risk and Disclosure of Liquidity and Financing Risk"

On October 8, 2024, the Banking Supervision Department published a circular regarding disclosure of interest rate risk and disclosure of liquidity and financing risk.

Under the circular, revisions were made to the Reporting to the Public Directives with the aim of establishing an expanded and adapted disclosure framework for achieving effective and comprehensive disclosure regarding management of interest rate, liquidity and financing risks. Among other things, Note 23 was regarding "Assets and Liabilities by Currency and Term to Maturity" was revised as detailed below:

The note's name was changed to "Cash Flows in Accordance with the Contractual Repayment Date".
The disclosure regarding the composition of financial assets and liabilities was expanded.
Details of longer repayment periods were reduced.
A requirement of providing quarterly disclosure of this Note, on a consolidated basis, had been added.

The Circular's provisions were applied as from the Annual Financial Statements as of December 31, 2024 and the Interim Financial Statements as of March 31, 2025. Comparison figures were presented in accordance with the data detailed in the disclosure format in the Reporting to the Public Directives.

NOTE 4 - SEGMENT REPORTING

A. General

The Group operates in the following operating segments:

1. Life Insurance and Long-Term Savings

The Long-Term Savings Segment comprises life insurance, related coverages (appendices), investment contracts, and management of pension funds and provident funds. The segment comprises long-term savings (under various types of insurance policies, pension funds and provident funds, including advanced education funds), and insurance coverages for various risks, such as: death, disability, long-term health, and health insurance sold as appendices to life insurance policies, and more. According to the Commissioner's Directives, the Long-Term Savings Segment is described in accordance with the following subsegments: Provident, Pension and Life Insurance.

2. Health Insurance

The Health Insurance Segment comprises the Group's activity in the Health Insurance Subsegments. The segment comprises insurance for long-term care, medical expenses insurance, surgery, transplants, personal accidents (Long-Term Health Subsegment), travel and more.

3. P&C insurance

The P&C Insurance Segment comprises the Liability and Property Subsegments, Credit Insurance, Personal Accidents Insurance and Other.

4. Credit Cards Segment

Includes the credit card company's operating results, divided into two main subsegments: Issuing and Acquiring.

Issuing Subsegment

The Issuing Subsegment focuses on 2 main activities:

1. Solutions for financial institutions joint credit card issuing and processing with banks, for their customers (B2B2C); hereinafter - "bank payment cards".
1. Private customers sale and marketing of non-bank credit cards, consumer credit and other products directly to private customers, i.e., consumers (B2C), including through joint loyalty programs.

As part of the Issuing Subsegment, Max issues payment cards to its customers, which are used as a means of payment for transactions and cash withdrawal by merchants in Israel and worldwide that accept the brands issued by the Company. Max's revenues from card holders is from fees and commissions collected from the card holders and issuer fees collected from the credit card companies (as acquiring companies) as well as from international organizations (acquirers outside Israel). In addition, interest is collected from Max customers for transactions and credit products provided by Max.

Acquiring Subsegment

This subsegment includes mainly the following activities:

1. Acquiring services Payment guarantees against vouchers of transactions carried out using credit cards in exchange for a fee collected from the merchant.
1. Related services and complementary products to the acquiring services.
1. Financial solutions Products and services offered to merchants, such as loans, voucher factoring, early payments and guarantees, in respect of which interest, fees and commissions are collected from the merchants.

Furthermore, the Credit Card Segment will include the operating results of Milo Brom Holdings Ltd. (hereinafter - "Milo"), which holds the following companies:

A. Hyp Payment Solutions Ltd. (hereinafter - "Hyp"), which provides payment solutions to e-commerce websites and merchants, used for payment by credit cards and other means of payment, and provides credit card reconciliation services through a system that enables monitoring merchants' business activity with credit card companies and factoring companies. Hyp also provides a bookkeeping management and digital invoice generation system;

B. Max EVS Ltd. (held at 51%) - is a technological joint venture in the field of charging systems and other services relevant to electric vehicles and solar roofs.

5. Other

Includes operating segments that do not meet the quantitative thresholds for reporting, mainly in respect of the insurance agencies.

6. Activity not allocated to segments

This activity includes the Group's headquarters, which is mainly the capital, the liabilities not in the insurance business and the assets held against them by Clal Insurance rather than by the credit card company's business, as well as the Company's separate balances and results.

As of April 1, 2023, the results also include the finance expenses for the Syndicated Loan in respect of the Max acquisition transaction. On February 25, 2024, CIMax executed early repayment of the full amount of the syndicated loan. For further details, see Note 26(a1)(3) to the Consolidated Financial Statements for 2023.

B. Seasonality

1. Life Insurance and Long-Term Savings Segment

As a general rule, revenues from life insurance premiums and management fees revenue from pension funds and provident funds are not characterized by seasonality; therefore, claims are not subject to seasonality either.

However, since the tax year ends in December, there is a certain effect of seasonality in that month in terms of payment of premiums/contributions towards benefits for pension saving products, since significant amounts are deposited in this month by salaried employees and self-employed persons, who make contributions independently outside their payroll in order to fully utilize the tax benefits, and also by employers that pay outstanding debts in respect of the relevant tax year or make one-off contributions, normally in respect of severance pay-related debts. Furthermore, the amounts of premiums/contributions towards benefits may be higher in certain months, which vary from one year to another, mainly due to one-off payments made by employers to employees, and in respect of which contributions towards benefits are made.

2. Property and Casualty Insurance Segment

As a general rule, income earned from insurance services in the Property and Casualty Insurance Segment are not affected by significant seasonality. However, the premium income in the first quarter of the year are higher than premium income in the other quarters, mainly due to renewal of insurance agreements of business policyholders and large car fleets at the beginning of the calendar year, which reflects a certain degree of seasonality. The effect of this seasonality on the reported income is adjusted through the liability for remaining coverage.

There is no significant seasonality in other components of expenses, such as claims and in other revenue components, such as investment revenue. However, it should be noted that during the winter season - in the first quarter or fourth quarter of the year, or both - there is sometimes an increase in claims, mainly in the Property Insurance Subsegment, and consequently the reported profit for the period decreases.

C. Operating segment reporting

	Provident For the three			Pension			Investment contracts				Life Insurance			Total
						For the three			For the three
	month period		For the	For the three		For the		month period		For the	month period		For the	For the three		For the
	ended March 31		year ended December 31	month period	ended March 31	year ended December 31		ended March 31		year ended December 31	ended March 31		year ended December 31	month period ended March 31		year ended December 31
		2025 2024	2024	2025	2024			2024 2025 2024			2024 2025	2024	2024	2025	2024	2024
In NIS million									Unaudited
Revenues from insurance services	‐	‐		‐	‐	‐	‐				705	660	2,656	705	660	2,656
Expenses from insurance services	‐	‐		‐	‐	‐	‐				(626)	(572)	(2,409)	(626)	(572)	(2,409)
Income from insurance services before reinsurance
contracts held	‐	‐		‐	‐	‐	‐				79	88	246	79	88	246
Reinsurance expenses	‐	‐		‐	‐	‐	‐				(47)	(69)	(230)	(47)	(69)	(230)
Reinsurance revenues	‐	‐		‐	‐	‐	‐				47	44	183	47	44	183
Revenues/expenses, net from reinsurance
contracts held	‐	‐		‐	‐	‐	‐				‐	(25)	(47)	‐	(25)	(47)
Income (loss) from insurance services	‐	‐		‐	‐	‐	‐				79	63	199	79	63	199
Investment gains (losses), net from assets held against
insurance contracts and yield-dependent
investment contracts	‐	‐		‐		‐	‐	(5)	577		1,442	153 3,156	9,051	148	3,733	10,492
Gains (losses) from other investments, net:
Interest revenues calculated using the effective
interest method	85	42	220			‐	‐				‐		‐	85 ‐	42	220
Net losses from impairment of financial assets	‐	‐		‐		‐	‐				‐		‐	‐ ‐	‐	‐
Other investment income (losses), net	(43)	1		3	1	2	5				(95)	472	1,592	(137)	475	1,600
Share in profits (losses) of equity-accounted subsidiaries closely
related to the investing activity	-	‐		‐		‐	1				(1)		(1) ‐	(1)	‐	(1)
Total gains (losses) from other investments, net	42	43	223		1	2	5	-	-		- (96)	472	1,591	(53)	516	1,820
Total investment gains (losses), net	42	43	223		1	2	5	(5)	577		1,442	57 3,628	10,641	95	4,249	12,312
Finance expenses (income), net arising from insurance contracts		‐		‐		‐	‐	‐	‐		‐	79 (3,532)	(10,289)		79 (3,532)	(10,289)
Finance income (expenses), net arising from
reinsurance contracts		‐		‐		‐	‐	‐	‐		‐ (6)	(4)		‐ (6)	(4)	‐
Decrease (increase) in liabilities for investment contracts due to
the yield component	(41)	(40)	(218)		-	‐	‐		5 (577)	(1,442)	‐		‐	‐ (36)	(617)	(1,660)
Income (loss) from investments and financing, net	2	3		5	1	2	5	‐	‐		130 ‐	92	352	132	96	363
Income (loss), net from insurance and investment	2	3		5	1	2	5	‐	‐		‐ 209	155	552	211	160	563

		Provident	Pension			Investment contracts				Life Insurance				Total
	For the three						For the three				For the three
	month period		For the	For the three		For the	month period		For the		month period		For the		For the three		For the
	ended March 31		year ended December 31	month period ended March 31		year ended December 31	ended March 31		year ended December 31		ended March 31		year ended December 31		month period ended March 31		year ended December 31
		2025 2024	2024	2025	2024		2024 2025 2024		2024		2025	2024	2024		2025	2024	2024
In NIS million									Unaudited
									Unaudited
Revenues from credit card transactions
Revenues from management fees	75	75	299	105	97	402	25		27	103	‐	‐		‐	204	199	804
Revenues from fees and commissions of Brokers (Agencies)	‐	‐		‐ ‐		‐	‐	‐	‐	‐	‐	‐		‐	‐	‐	‐
Credit loss expenses
Credit card processing
Payments to banks
Other operating expenses	(72)	(71)	(294)	(89)	(86)	(356)	(26)	(22)	(102)		‐	(1)	(2)		(187)	(180)	(754)
Other revenues (expenses), net	(1)	(1)	(6)	(1)	(1)	(5)		‐	‐	‐	‐	‐		‐	(2)	(2)	(11)
Other finance expenses	‐	‐		‐ ‐		‐	‐	‐	‐	‐	‐	‐		‐	‐	‐	‐
Share in profits (losses) of equity-accounted subsidiaries which
are not closely related to the investing activity	‐	‐		‐ ‐		‐	‐	‐	‐	‐	‐	‐		‐	‐	‐	‐
Income (loss) before tax	3	5		4 15	12		46 (1)		5	1	209	154	550		226	176	602
Other comprehensive income											1				1	1
Comprehensive income (loss) before taxes	3	5		4 15	12		46 (1)		5	1	210	154	550		227	177	602
Total segment assets															127,270 125,133		127,607
Total segment assets for yield-dependent contracts															94,868 93,512		96,062
Total segment liabilities															124,031 123,488		125,864

	Health Insurance				P&C Insurance		Credit cards					Other Operating Segments
	For the three month period		For the year ended	For the three month period		For the year ended	For the three month period		For the year ended	For the three month period		For the year ended
	ended March 31 2025	2024	December 31 2024	ended March 31 2025	2024	December 31 2024	ended March 31 2025	2024	December 31 2024	ended March 31	2025 2024	December 31 2024
In NIS million							Unaudited
Revenues from insurance services	516	454	1,959	956	916	3,777	‐		‐	‐	‐	‐ ‐
Expenses from insurance services	(413)	(366)	(1,510)	(778)	(727)	(2,645)	‐		‐	‐	‐	‐ ‐
Income from insurance services before reinsurance contracts held	103	87	450	178	189	1,132	‐		‐	‐	‐	‐ ‐
Reinsurance expenses	(14)	(13)	(62)	(289)	(303)	(1,148)	‐		‐	‐	‐	‐ ‐
Reinsurance revenues	(5)		6 37	183	154	463	‐		‐	‐	‐	‐ ‐
Revenues/expenses, net from reinsurance contracts held	(19)	(7)	(26)	(106)	(149)	(685)	‐		‐	‐	‐	‐ ‐
Income (loss) from insurance services	85	80	424	72	40	447	‐		‐	‐	‐	‐ ‐
Investment gains (losses), net from assets held against insurance contracts and yield
dependent investment contracts	3	50	142	‐	‐		‐ ‐		‐	‐	‐	‐ ‐
Gains (losses) from other investments, net:
Other investment income (losses), net	36	85	314	36	94	270	‐		‐	‐	‐	‐ ‐
Share in profits (losses) of equity-accounted subsidiaries closely related to the investing activity	‐		‐ ‐	(1)	‐	(2)	‐		‐	‐	‐	‐ ‐
Total gains (losses) from other investments, net	36	85	314	35	94	269	‐		‐	‐	‐	‐ ‐
Total investment gains (losses), net	39	135	456	35	94	269	‐		‐	‐	‐	‐ ‐
Finance expenses (income), net arising from insurance contracts	(11)	(167)	(480)	(17)	(53)	(272)	‐		‐	‐	‐	‐ ‐
Finance income (expenses), net arising from reinsurance contracts	‐	12	33	7	23	116	‐		‐	‐	‐	‐ ‐
Income (loss) from investments and financing, net	29	(21)	8	25	63	113	‐		‐	‐	‐	‐ ‐
Income (loss), net from insurance and investment	113	60	432	97	103	560	‐		‐	‐	‐	‐ ‐
Investment income, net and finance income which are not from a consolidated insurance company	‐		‐ ‐	‐	‐		328 ‐	305	1,278		‐	1 ‐
Revenues from credit card transactions	‐		‐ ‐	‐	‐		‐ 409	354	1,554		‐	‐ ‐
Revenues from fees and commissions of Brokers (Agencies)	‐		‐ ‐	‐	‐		9 ‐		5	21 60	56	245
Credit loss expenses	‐		‐ ‐	‐	‐		‐ (46)	(41)	(216)		‐	‐ ‐
Credit card processing	‐		‐ ‐	‐	‐		(255) ‐	(268)	(986)		‐	‐ ‐
Payments to banks	‐		‐ ‐	‐	‐		‐ (61)	(54)	(233)		‐	‐ ‐
Other operating expenses	‐		‐ ‐	(2)	(2)	(10)	(142)	(130)	(547)	(48)	(47)	(193)
Other revenues (expenses), net	‐		‐ ‐	‐	‐		‐ ‐		‐	‐ (2)	(2)	(9)
Other finance expenses	‐		‐ ‐	(1)	‐		‐ (125)	(118)	(485)		(1) ‐	(2)
Share in profits (losses) of equity-accounted subsidiaries which are not closely related to the
investing activity	‐		‐ ‐	‐	‐		1 ‐		‐	4	4	3 12
Income (loss) before tax	113	60	432	94	101	550	118		93	390 14	10	53
Other comprehensive income				1
Comprehensive income (loss) before taxes	113	60	432	95	101	550	118		93	390 14	10	53
Total segment assets		6,790 6,513	7,176	8,001	7,425		7,465 19,937 17,394		19,409	438	315	433
Total segment assets for yield-dependent contracts		1,265 1,186	1,267
Total segment liabilities		6,457 6,253	6,582	7,039	7,008		6,953 17,625 15,524		17,309	192	160	207

	Not attributed to operating segments			Adjustments and offsets					Total
		For the		For the three		For the	For the three		For the
	For the three-month	year ended		month period		year ended	month period		year ended
	period ended March 31		December 31	ended March 31		December 31	ended March 31		December 31
	2025	2024	2024	2025	2024	2024	2025	2024	2024
In NIS million					Unaudited
Revenues from insurance services	‐	‐	‐	‐	‐		1 2,178	2,030	8,391
Expenses from insurance services	‐	‐	‐	‐	‐		‐ (1,817)	(1,666)	(6,566)
Income from insurance services before reinsurance contracts held	‐	‐	‐	‐	‐		1 361	364	1,825
Reinsurance expenses	‐	‐	‐	‐	‐		(350) ‐	(384)	(1,441)
Reinsurance revenues	‐	‐	‐	‐	‐		‐ 225	203	683
Revenues/expenses, net from reinsurance contracts held	‐	‐	‐	‐	‐		(124) ‐	(181)	(758)
Income (loss) from insurance services	‐	‐	‐	‐	‐		1 236	183	1,067
Investment gains (losses), net from assets held against insurance contracts and yield-dependent investment contracts	‐	‐	‐	‐	‐		151 ‐	3,783	10,635
Gains (losses) from other investments, net:
Interest revenues calculated using the effective interest method	‐	‐	‐	‐	‐		85 ‐	42	220
Net losses from impairment of financial assets	‐	‐	‐	‐	‐		‐ ‐	‐	‐
Other investment income (losses), net	115	102	593	‐	‐		50 ‐	755	2,777
Share in profits (losses) of equity-accounted subsidiaries closely related to the investing activity	1	(1)	‐	‐	‐		(1) ‐	(1)	(2)
Total gains (losses) from other investments, net	116	100	593	‐	‐		134 ‐	795	2,995
Total investment gains (losses), net	116	100	593	‐	‐		1 285	4,578	13,630
Finance expenses (income), net arising from insurance contracts	‐	‐	‐	‐	‐		(51) ‐	3,752	11,041
Finance income (expenses), net arising from reinsurance contracts	‐	‐	‐	‐	‐		1 1	31	149
Decrease (increase) in liabilities for investment contracts due to the yield component	‐	‐	‐	‐	‐		‐ (36)	(617)	(1,660)
Income (loss) from investments and financing, net	116	100	593	‐	‐		‐ 302	239	1,078
Income (loss), net from insurance and investment	116	100	593	‐	‐		538 ‐	422	2,145
Investment income, net and finance income which are not from a consolidated insurance company	20	11	27	7	29	64	354	345	1,370
Revenues from credit card transactions	‐	‐	‐	‐	‐		‐ 409	354	1,554
Revenues from management fees	‐	‐	‐	‐	‐		205 ‐	199	805
Revenues from fees and commissions of Brokers (Agencies)	‐	‐	‐	(21)	(23)	(86)	49	39	180
Credit loss expenses	‐	‐	‐	‐	‐		(46) ‐	(41)	(216)
Credit card processing	‐	‐	‐	‐	‐		‐ (255)	(228)	(986)
Payments to banks	‐	‐	‐	‐	‐		(61) ‐	(54)	(233)
Other operating expenses	(28)	(19)	(95)	21	24	86	(388)	(356)	(1,509)
Other revenues (expenses), net	‐	‐	(1)	(7)	(4)	(24)	(11)	(8)	(47)
Other finance expenses	(68)	(81)	(307)	‐	5		5 (194)	(196)	(794)
Share in profits (losses) of equity-accounted subsidiaries which are not closely related to the investing activity	‐	‐	‐	‐	‐		4 ‐	3	16
Income (loss) before tax	40	11	216	2	30	44	605	480	2,286
Other comprehensive income	1						3	1
Comprehensive income (loss) before taxes	41	11	216	2	30	44	608	481	2,286
Total segment assets	9,619	10,089	10,412	(467)	286		495 171,611 167,154		173,008
Total segment assets for yield-dependent contracts							96,133	94,698	97,329
Total segment liabilities	7,594	7,355	7,495	566	295		215 162,380 159,476		164,189

41 - 2

D. Additional information regarding the Company's activities by main portfolios groups

Additional data regarding the Life Insurance and Long-Term Savings operating segment

		For the three-month period ended March 31
	2025	2024	2024
In NIS million		Unaudited
Proceeds from investment contracts	413	274	1,331
Annualized receipts for investment contracts - new business	9	11	38
One-off proceeds for investment contracts	329	175	955

	Policies with a non-yield dependent savings component	Policies with a yield dependent savings component		Policies without a savings component Total
In NIS million	Unaudited
Gross data for the 3-month period ended March 31, 2025
Gross premiums for insurance contracts net of reimbursement of premiums (*)		70	773	281	1,124
(*) Of which: Savings component		68	709	-	777
Variable management fees		-	-	-	-
Fixed management fees		-	123	-	123
	Policies with a non-yield dependent savings component	Policies with a yield dependent savings component		Policies without a savings component Total
In NIS million	(Unaudited)
Gross data for the 3-month period ended March 31, 2024
Gross premiums for insurance contracts net of reimbursement of premiums (*)		57	871	267	1,195
(*) Of which: Savings component		55	800	-	855
Variable management fees		-	-	-	-
Fixed management fees		-	124	-	124

	Policies with a non-yield dependent savings component	Policies with a yield dependent savings component	Policies without a savings component	Total
In NIS million	(Unaudited)
Gross data, for the 12-month period ended December 31, 2024
Gross premiums for insurance contracts net of reimbursement of premiums (*)	247	3,349	1,064	4,661
(*) Of which: Savings component	239	3,047		- 3,286
Variable management fees		-	2	- 2
Fixed management fees		-	500	- 500

Additional data regarding the Health Insurance Segment

	Long-term care	Health Insurance - other
	Private individuals Collective		Medical expenses and disabilities - individual	Medical expenses and disabilities - Other collective (a)			Total
In NIS million			(Unaudited)
Gross premium
For the three-month period ended March 31, 2025	69	6	167		32	207	481
For the three-month period ended March 31, 2024	69	6	151		27	182	435
For the year ended December 31, 2024	279	26	561	117		873	1,856

A. Other including critical illness, personal accidents, and travel

Additional data regarding the Property and Casualty Insurance Segment

	Compulsory motor insurance	Motor property	Credit Insurance	Other (a)	Total
In NIS million	(Unaudited)
Gross premium
For the three-month period ended March 31, 2025	238	363	37	434	1,072
For the three-month period ended March 31, 2024	219	378	35	497	1,129
For the year ended December 31, 2024	776	1,314		139 1,731	3,960

B. "Other" property and casualty insurance includes the remaining Property and Casualty Insurance Subsegments, which are not compulsory motor and motor property insurance; it consists mainly of a business, home and engineering insurance portfolio, the premium in respect of which accounts for approx. 85% of total premiums in these subsegments.

NOTE 5 - FINANCIAL INVESTMENTS AND DERIVATIVE INSTRUMENTS

A. Financial investments held against yield-dependent contracts - breakdown of financial investments by asset type

	As of March 31		As of December 31
	2025	2024	2024
In NIS million		Unaudited
Debt instruments:
Illiquid debt instruments:
Deposits with banks and financial institutions	‐	148	124
Illiquid corporate bonds	702	842	723
Loans (including investees)	6,654	7,094	6,791
Total illiquid debt instruments	7,356	8,084	7,638
Liquid debt instruments:
Government Bonds	10,634	9,369	10,526
Liquid corporate bonds	15,309	18,398	15,385
Total liquid debt instruments	25,943	27,766	25,911
Total debt instruments	33,299	35,850	33,549
Equity instruments:
Illiquid debt instruments:
Illiquid shares	2,441	2,155	2,288
Liquid equity instruments:
Liquid shares	17,040	17,081	17,986
Total equity instruments	19,481	19,236	20,274
Other investments:
Other investments (1)	32,946	29,449	33,935
Derivative instruments (2)	604	954	1,044
Total other financial investments	33,550	30,403	34,979
Total financial investments	86,330	85,489	88,802
Liabilities for derivatives(2)	671	519	428

1) Other investments mainly include investments in ETFs, participation certificates in mutual funds, investment funds, and structured products.

B. Other financial investments (not in respect of yield-dependent contracts)

B. 1 Breakdown of financial investments by asset type

	As of March 31, 2025
	Financial investments measured at fair value through profit or loss	Other financial investments measured at depreciated cost	Total
In NIS million		Unaudited
Debt instruments:
Illiquid debt instruments:				‐
Deposits with banks and financial institutions	386		20	406
Treasury deposits		‐	2,216	2,216
Designated bonds	19,384		‐	19,384
Illiquid corporate bonds	237		22	259
Loans (including investees)	7,980		70	8,050
Total illiquid debt instruments	27,987		2,328
Liquid debt instruments:				‐
Government Bonds	3,274		‐	3,274
Liquid corporate bonds	2,650		‐	2,650
Total liquid debt instruments	5,924		‐	5,924
Total debt instruments	33,911		2,328	36,239
Equity instruments:		‐	‐	‐ ‐
Illiquid debt instruments:				‐
Illiquid shares	842		‐	842
Liquid equity instruments:
Liquid shares	993		‐	993
Total equity instruments	1,835		‐	1,835
Other investments:				‐ ‐
Other investments (1)	5,823		‐	5,823
Derivative instruments (2)	106		‐	106
Total other financial investments	5,929		‐	5,929
Total financial investments	41,675		2,328	44,003
Liabilities for derivatives(2)	258		-	258

1) Other investments mainly include investments in ETFs, participation certificates in mutual funds, investment funds, and structured products.

	As of March 31, 2024
	Other financial Financial investments investments measured at fair value measured at through profit or loss depreciated cost Total
In NIS million	Unaudited
Debt instruments:
Illiquid debt instruments:			‐
Deposits with banks and financial institutions	526	23	549
Treasury deposits	‐	2,196	2,196
Designated bonds	18,827	‐	18,827
Illiquid corporate bonds	266	52	318
Other illiquid debt instruments	7,171	62	7,233
Total illiquid debt instruments	26,790	2,333	29,123
Liquid debt instruments:			‐
Government Bonds	3,164	‐	3,164
Other liquid debt instruments	3,101	‐	3,101
Total liquid debt instruments	6,265	‐	6,265
Total debt instruments	33,055	2,333	35,388
Equity instruments:
Illiquid debt instruments:
Investments in other equity instruments	773	‐	773
Liquid equity instruments:
Liquid shares	1,034	‐	1,034
Total equity instruments	1,807	‐	1,807
Other investments:
Other investments (1)	5,597	‐	5,597
Derivative instruments (2)	288	‐	288
Total other financial investments	5,885	‐	5,885
Total financial investments	40,747	2,333	43,080
Liabilities for derivatives(2)	152	-	152

1) Other investments mainly include investments in ETFs, participation certificates in mutual funds, investment funds, and structured products.

	As of December 31, 2024
	Financial investments Other financial measured at fair value investments measured
	through profit or loss	at depreciated cost	Total
In NIS million	Unaudited
Debt instruments:
Illiquid debt instruments:
Deposits with banks and financial institutions	402	20	422
Treasury deposits	‐	2,226	2,226
Designated bonds	18,680	‐	18,680
Illiquid corporate bonds	257	29	286
Loans (including investees)	7,803	65	7,868
Total illiquid debt instruments	27,142	2,340	29,482
Liquid debt instruments:
Government Bonds	3,351	‐	3,351
Liquid corporate bonds	2,855	‐	2,855
Total liquid debt instruments	6,206	‐	6,206
Total debt instruments	33,348	2,340	35,688
Equity instruments:
Illiquid debt instruments:
Illiquid shares	801	‐	801
Liquid equity instruments:
Liquid shares	975	‐	975
Total equity instruments	1,776	‐	1,776
Other investments:
Other investments (1)	5,901	‐	5,901
Derivative instruments (2)	154	‐	154
Total other financial investments	6,055	‐	6,055
Total financial investments	41,179	2,340	43,519
Liabilities for derivatives(2)	100	-	100

1) Other investments mainly include investments in ETFs, participation certificates in mutual funds, investment funds, and structured products.

C. Financial instruments held against yield-dependent contracts C.1. Fair value of financial instruments by level

		As of March 31, 2025
	Level 1	Level 2	Level 3		Total
In NIS million	Unaudited
Financial investments:
Illiquid debt instruments		‐	7,337	19	7,356
Liquid debt instruments		21,590	4,352	‐	25,943
Capital instruments		16,652	388	2,441	19,481
Other financial investments		16,118	2,520	14,913	33,550
Total financial assets		54,360	14,597	17,373	86,330
Of which for derivatives		91	503	10	604

During the period there were no material transfers between Level 1 and Level 2

	As of March 31, 2024
	Level 1	Level 2		Level 3	Total
In NIS million	Unaudited
Financial investments:
Illiquid debt instruments		‐	8,055	29	8,084
Liquid debt instruments		23,236	4,530	‐	27,766
Capital instruments		16,615	466	2,155	19,236
Other financial investments		15,112	2,270	13,020	30,403
Total financial assets		54,963	15,322	15,204	85,489
Of which for derivatives		91	855	8	954

During the period there were no material transfers between Level 1 and Level 2

	As of December 31, 2024
	Level 1	Level 2		Level 3	Total
In NIS million	Unaudited
Financial investments:
Illiquid debt instruments		‐	7,620		18	7,638
Liquid debt instruments		21,751	4,160		‐	25,911
Capital instruments		17,471	515		2,288	20,274
Other financial investments		17,646	2,850		14,483	34,979
Total financial assets		56,868	15,145		16,789	88,802
Of which for derivatives		101	934		89	1,044

During the period there were no material transfers between Level 1 and Level 2

	Illiquid debt instruments	Capital Other instruments investments Total
In NIS million	Unaudited
Balance as of January 1, 2025	18	2,288	14,483	16,789
Total income (losses) recognized:
In profit and loss1	1	64	503	568
Purchases	‐	93	536	629
Sales	‐	‐	(598)	(598)
Interest and dividend received	‐	(4)	(11)	(15)
Balance as of March 31, 2025	19	2,441	14,913	17,373
Total gains (losses) for the period included in profit or loss in respect
of assets held as of March 31, 2025	1	64	507	572

C.2. Level 3 financial instruments measured at fair value held against yield-dependent contracts

	Illiquid debt Capital Other instruments instruments investments Total
In NIS million		Unaudited
Balance as of January 1, 2024	29	1,968	12,539	14,537
Total realized gains (losses):
In profit and loss1	‐	(78)	236	158
Purchases	‐	275	520	795
Sales	‐	(6)	(275)	(281)
Interest and dividend received	‐	(4)	‐	(4)
Balance as of March 31, 2024	29	2,155	13,020	15,204
Total gains (losses) for the period included in profit or loss in respect
of assets held as of March 31, 2024	‐	(78)	237	159

	Illiquid debt instruments	Capital instruments	Other investments	Total
In NIS million			Unaudited
Balance as of January 1, 2024	29	1,968	12,539	14,537
Total realized gains (losses):
In profit and loss1	6	(123)	792	675
Purchases		‐	509 2,762	3,271
Sales		‐	(56) (1,591)	(1,647)
Redemptions	(24)		‐	‐ (24)
Interest and dividend received	(3)		(10) (9)	(22)
Debt-to-equity swap	10		- (10)	-
Balance as of December 31, 2024	18	2,288	14,483	16,789
Total gains (losses) for the period included in profit or loss in respect
of assets held as of December 31, 2024		- (123)	812	689

Recognized under investment income (losses), net from assets held against insurance contracts and yield-dependent investment contracts

D. Other financial instruments not held against yield-dependent contracts D.1. Fair value of financial instruments by level

	As of March 31, 2025
	Level 1	Level 2	Level 3	Total
In NIS million		Unaudited
Financial assets:
Illiquid debt instruments, excluding designated bonds		‐	5,192	3,411	8,603
Designated bonds		‐	‐	19,384	19,384
Liquid debt instruments		5,843	81	‐	5,924
Capital instruments		960	33	842	1,835
Other investments		701	123	5,105	5,929
Total financial assets		7,504	5,429	28,742	41,675
Of which for derivatives		8	94	4	106

During the period there were no material transfers between Level 1 and Level 2

	As of March 31, 2024
	Level 1	Level 2	Level 3	Total
In NIS million	Unaudited
Financial assets:
Illiquid debt instruments, excluding designated bonds		‐	5,556	2,407	7,963
Designated bonds		‐	‐	18,827	18,827
Liquid debt instruments		6,123	142	‐	6,265
Capital instruments		1,007	27	773	1,807
Other investments		927	281	4,677	5,885
Total financial assets		8,057	6,006	26,684	40,747
Of which for derivatives		4	281	3	288

During the period there were no material transfers between Level 1 and Level 2

	As of December 31, 2024
	Level 1	Level 2	Level 3	Total
In NIS million	Unaudited
Financial assets:
Illiquid debt instruments, excluding designated bonds		‐	5,299	3,163	8,462
Designated bonds		‐	‐	18,680	18,680
Liquid debt instruments		6,079	127	‐	6,206
Capital instruments		930	45	801	1,776
Other investments		905	146	5,004	6,055
Total financial assets		7,914	5,617	27,648	41,179
Of which for derivatives		4	145	4	153

During the period there were no material transfers between Level 1 and Level 2

	As of March 31, 2025
	Illiquid debt instruments, excluding designated bonds	Designated bonds	Capital instruments	Other investments Total
In NIS million	Unaudited
Balance as of January 1, 2025	3,163	18,680	801		5,004 27,648
Total income (losses) recognized:
In profit and loss	42	(146)	26	176	98
Purchases	282	908	19	148	1,357
Sales		‐	‐	‐ (222)	(222)
Redemptions	(57)	(58)		‐	(115) ‐
Interest and dividend received	(19)		(4) ‐	(1)	(24)
Balance as of March 31, 2025	3,411	19,384	842		5,105 28,742
Total gains (losses) for the period included in profit or loss for assets and liabilities held as of March 31, 2025	42	(146)	26	176	98

D.2 Level 3 financial instruments measured at fair value held against yield-dependent contracts

	As of March 31, 2024
	Illiquid debt instruments, excluding designated bonds	Designated bonds	Capital instruments	Other investments Total
In NIS million			Unaudited
Balance as of January 1, 2024	2,179	18,539	757		4,528 26,003
Total income (losses) recognized:
In profit and loss		72 288	(4)	81	437
Purchases	222		26 ‐	164	412
Sales		‐	(3) ‐	(96)	(99)
Redemptions	(52)		‐ ‐		‐ (52)
Interest and dividend received	(14)		‐ (3)		‐ (17)
Balance as of March 31, 2024	2,407	18,827	773		4,677 26,684
Total gains (losses) for the period included in profit or

loss for assets and liabilities held as of March 31, 2024 72 288 (4) 81 437

As of December 31, 2024
	Illiquid debt instruments, excluding designated bonds	Designated bonds	Capital instruments	Other investments Total
In NIS million	Unaudited
Balance as of January 1, 2024	2,179	18,539	757	4,528 26,003
Total income (losses) recognized:
In profit and loss	314	1,075	(8)	189 1,570
Purchases	998	1,388	85	812 3,283
Sales		‐	‐ (26)	(525) (551)
Redemptions	(253)	(1,573)		‐ ‐ (1,826)
Interest and dividend received	(75)	(749)	(7)	‐ (831)
Balance as of December 31, 2024	3,163	18,680	801	5,004 27,648
Total gains (losses) for the period included in profit or loss
for assets and liabilities held as of December 31, 2024	314	1,075	(8)	196 1,577

D.3. Financial instruments measured at fair value for disclosure purposes only

	As of March 31, 2025
In NIS million	Carrying amount	Fair value
Financial assets
Other financial investments measured at depreciated cost:
Illiquid debt instruments:
Deposits with banks and financial institutions	20	20
Treasury deposits	2,216	2,707
Illiquid corporate bonds	22	22
Loans (including investees)	70	69
Total illiquid debt instruments	2,328	2,818
Total financial assets	2,328	2,818
In NIS million	Carrying amount	As of March 31, 2024 Fair value
Financial assets
Other financial investments measured at depreciated cost:
Illiquid debt instruments:
Deposits with banks and financial institutions	23	23
Treasury deposits	2,196	2,761
Illiquid corporate bonds	52	46
Loans (including investees)	62	60
	2,333	2,890
Total illiquid debt instruments

		As of December 31, 2024
In NIS million	Carrying amount	Fair value
Financial assets

Other financial investments measured at depreciated cost:

Illiquid debt instruments:

Deposits with banks and financial institutions 20	20
Treasury deposits 2,226	2,704
Illiquid corporate bonds 29	30
Loans (including investees) 65	64
Total illiquid debt instruments 2,340	2,818
Total financial assets 2,340	2,818

E. Additional information regarding the fair value of financial instruments

The different fair value levels were defined as follows:

Level 1 fair value measured using quoted prices (unadjusted) in an active market for identical instruments.
Level 2 fair value measured using observable inputs, either directly or indirectly, that are not included in Level 1 above.
Level 3 fair value measured using inputs that are not based on observable market inputs.

Valuation techniques

The fair value of investments traded actively in regulated financial markets is determined based on market prices as of the reporting date.

With respect to investments for which there is no active market. Fair value is determined using valuation techniques. Such techniques include using transactions which were recently made at fair market value, reference to the current market value of another instrument which is substantially the same, discounted cash flows, or other valuation methods.

Illiquid debt assets (excluding designated bonds)

The fair value of illiquid debt assets, which are measured at fair value through profit and loss, and the fair value of illiquid financial debt assets, for which fair value information is provided solely for disclosure purposes, is determined by discounting the estimated future cash flows from those assets.

The discount rates are based primarily on yields on government bonds and spreads of corporate bonds as measured on the Tel Aviv Stock Exchange. The quoted prices and interest rates used for discounting purposes are determined by a company which won the tender, published by the Ministry of Finance, for the setting up and operating a database of quoted prices and interest rates for institutional entities.

On March 2, 2025, the Capital Markets, Insurance and Savings Authority published a press release in which it announced that it selected Ness Fair Value Ltd. as a supplier for the revaluation of illiquid debt assets of the institutional entities.

Ness Fair Value (hereinafter - "Ness") will replace Fair Spread Ltd., which has been carrying out the revaluation since 2011, covering only non-complex illiquid debt assets issued in Israel. Under the new tender, the winning bidder will revalue all illiquid debt assets - issued both in and outside Israel - including complex debt assets. Furthermore, and in order to encourage trading in the institutional trading system (TASE-UP platform), "Ness Fair Value Ltd." will issue specific quotation regarding investment instruments traded in this platform, provided that these investment instruments are held by institutional entities. Preparations by "Ness Fair Value Ltd." are expected to take several months, during which the Company will receive both the details of the assets, which are the subject matter of the revaluation, which are currently revalued by Fair Spread, and of those, which were not included in the existing 3-2012 tender, but are included in the 3-2022 tender.

The Group is studying the implications of the decision and is preparing to implement the change in accordance with the guidelines to be received from the Capital Market Authority.

Designated bonds

Designated Hetz bonds (hereinafter – "Hetz Bonds") are illiquid and non-transferable bonds, which are issued (and repaid) by virtue of a series of agreements signed between the insurance companies and the State of Israel, and allocated at a certain rate of the insurance liabilities for insurance contracts, which include a guaranteed return savings component.

The Company calculates the fair value in accordance with the indirect approach, according to which the fair value calculation is based on the amortized cost of Hetz Bonds plus the excess value arising from the difference between the nominal interest on Hetz Bonds and the risk-free interest rate curve plus the illiquidity premium used in the financial statements. The estimated cash flows of Hetz Bonds are based on expected cash flows in respect of insurance liabilities and therefore include assumptions regarding non-observable inputs, such as cancellation rate, annuity uptake rate, retirement age, etc.

Investment in illiquid shares

The fair value of shares for which there is no quoted market price, is determined by the discounted cash flow model. The valuation requires the Company to make certain assumptions regarding non-observable inputs included in the model.

The following tables provide qualitative and quantitative information regarding significant non-observable data used in level 3 fair value measurements:

		March 31, 2025			December 31, 2024			Interactions
Financial instrument	Valuation technique	Significant non - observable inputs	Fair value (in NIS thousand)	Range (weighted average)	Fair value (in NIS thousand)	Range (weighted average)	Sensitivity of fair value to change in inputs	between significant non -observable inputs and fair other non - observable inputs
Capital instruments	Discounted cash flows	Growth rate					A significant increase in the growth rate will lead to a significant increase in fair value	There were no
		Discount rate	2,441		2,228		A significant increase in the discount rate will lead to a significant decrease in fair value	significant interactions between the non - observable inputs
Other	Discounted	Net asset value
investments	cash flows	(NAV) reports	14,903		14,474		N/A	N/A

		March 31, 2025			December 31,	2024		Interactions
Financial instrument	Valuation technique	Significant non observable inputs	Fair value (in NIS thousand)	Range (weighted average)	Fair value (in NIS thousand)	Range (weighted average)	Sensitivity of fair value to change in inputs	between significant non observable inputs and fair other non-observable inputs
		Discount rate		2.45%-2.83		2.12%-2.73%		There were no
Hetz bonds	Discounted cash flows	Actuarial assumptions	19,384	Based on an actuarial model	18,860	Based on an actuarial model		significant interactions between the non-observable inputs
Reverse mortgage	Discounted cash flows	Discount rate					A significant increase in the growth rate will lead to a significant increase in fair value	There were no significant
		Early redemptions	3,411	3.68%-6.58%	3,163	2.93%-6.74%	A significant increase in redemptions will lead to a significant decrease in fair value	interactions between the non-observable inputs
		Growth rate					A significant increase in the growth rate will lead to a significant increase in fair value	There were no significant
Capital instruments	Discounted cash flows	Discount rate	835		795		A significant increase in the discount rate will lead to a significant decrease in fair value	interactions between the non-observable inputs
Other	Discounted cash	Net asset value
investments	flows	(NAV) reports	5,102		5,102		N/A	N/A

Financial instruments held against non-yield-dependent liabilities

F. Receivables for credit card transactions - for Max

	March 31, 2025
	On-balance	Fair value
	sheet
	balances	Level 1	Level 2	Level 3	Total
In NIS million			Unaudited
Receivables for credit card transactions	17,735		‐	‐	17,655	17,655
	March 31, 2024
	On-balance		Fair value
	sheet
	balances	Level 1	Level 2	Level 3	Total
In NIS million			Unaudited
Receivables for credit card transactions	15,848		‐	‐	15,777	15,777
		December 31, 2024
	On-balance			Fair value
	sheet
	balances	Level 1	Level 2	Level 3	Total
In NIS million	Unaudited
Receivables for credit card transactions	17,751		‐	‐	17,675	17,675

G. Financial liabilities

1. Composition of fair value

			As of March 31			As of March 31 As of December 31
			2025	2024		2024
		Carrying		Carrying	Fair	Carrying
		value	Fair value	value	value	value	Fair value
In NIS million	Comment			Unaudited
Financial liabilities presented at fair value through
profit and loss:
Liability for derivative financial instruments *)		929	929	703	703	528	528
Liability for REPO *)		1,257	1,257	671	671	1,235	1,235
Total financial liabilities presented at fair value through profit
and loss		2,186	2,186	1,374	1,374	1,763	1,763
Financial liabilities presented at amortized cost:
The Company:
Bonds (Series A) - Liquid bonds	A	889	897	885	901	920	934
Bonds (Series B) - Liquid convertible bonds - Par value
component	A	142	163	139	137	144	155
Bonds (Series C) - Liquid bonds	A	507	516	504	513	500	514
Subsidiaries:
Loans in CIMax and its subsidiaries, excluding Max		11	11	9	9	12	12
Liquid subordinated notes in Clal Insurance	B	4,627	4,366	4,598	4,260	4,661	4,398
Credit from banking corporations in Max		5,544	5,544	4,721	4,721	5,993	5,995
Bonds and subordinated notes in Max	C	940	950	788	794	788	799
Total financial liabilities presented at amortized cost		12,660	12,447		11,644 11,335	13,019	12,806
Less interest payable in respect of bonds and subordinated
notes presented in payables and credit balances line item		48	48	35	35	115	115
Total financial liabilities		14,798	14,585		12,983 12,674	14,666	14,453
*) Of which for yield-dependent contracts		1,724	1,724	857	857	1,460	1,460

A. Bonds issued by the Company

On February 28, 2025, interest was paid on Bonds (Series A) and Bonds (Series B) totaling approx. NIS 47 million, and on May 1, 2025, subsequent to the reporting date, interest was paid on Bonds (Series C) totaling approx. NIS 13 million, in accordance with the terms and conditions of the notes.

B. Debt raising by Clal Insurance Capital Raising Ltd. a subsidiary of Clal Insurance (hereinafter - "Clal Capital Raising")

The issuance costs amounted to approx. NIS 5,820 thousand.

The total consideration (gross) received by Clal Capital Raising following issuance of the new bonds under the said issuance, was deposited in Clal Insurance in a deferred deposit under the same repayment and interest terms and conditions as those of the bonds. The Bonds are recognized as Tier 2 capital in Clal Insurance and bear equal status and seniority level as subordinated bonds issued by Clal Capital Raising and/or Clal Insurance that are classified as Subordinated Tier 2 capital, Hybrid Tier 2 capital and/or and Hybrid Tier 3 capital, as well as bonds that have been issued and/or shall be issued by Clal Capital Raising and/or Clal Insurance as a Tier 2 capital instrument, and are subordinated to the other liabilities of Clal Insurance, other than the rights of creditors in accordance with Tier 1 capital.

For information regarding the issuance's rating, see Section B above.

Additional terms and conditions of the bonds:

1. Right to early redemption

Clal Capital Raising shall be entitled, without giving bondholders and/or the trustee a choice, to redeem their bonds by way of early, full or partial redemption, if the following conditions are met:

The first date, on which Clal Capital Raising will be allowed to execute full or partial early redemption of the bonds will be September 30, 2034 (hereinafter - the "First Early Redemption Date"); subsequent to this date, Clal Capital Raising will be allowed to execute full or partial early redemption of the bonds at any time. The frequency of the early redemptions shall not exceed one redemption per quarter.
If Clal Capital Raising will not exercise its right to execute early redemption of all the bonds starting on the date of payment of the interest in respect of the bonds, which will be 3 years before the principal repayment date, i.e., September 30, 2036 (hereinafter - the "Effective Date for Additional Interest") - additional interest will be credited to the bond holders on the
interest payable on the bonds at that time, in respect of the remaining period (from the Effective Date for Additional Interest on which the abovementioned right was not exercised through the actual repayment date), which will be at the rate of 50% of the original risk margin set in the issuance; the original risk margin is 1.34%.
The minimum amount for early redemption is NIS 1 million p.v. in bonds.
In any case, no early redemption of part of the principal of the bonds shall be made if the outstanding principal balance that remains after early redemption is lower than NIS 3.2 million.
Early redemption will be possible if one of the following is met:
- (1) The bond will be converted into a capital instrument of equal or superior quality;
- (2) The Commissioner's advance approval was obtained on the terms they will set. In general, early redemption will be possible if Clal Insurance's shareholders' equity after the early redemption would exceed the solvency capital requirement (SCR).

2. Deferral of principal and/or interest repayment dates under suspending circumstances

Upon the occurrence of one of the suspending circumstances listed below, a principal payment and/or interest payments, as the case may be, in respect of the bonds:

With regard to deferral of interest payments:

In accordance with Clal Insurance's latest financial statements, which were published prior to the payment date, Clal Insurance has no distributable profits as defined in the Companies Law.

With regard to the deferral of a principal and/or interest:

(1) According to Clal Insurance's latest financial statements published prior to the payment date, Clal Insurance's shareholders' equity is lower than the capital required from Clal Insurance for suspending circumstances, Clal Insurance did not execute capital supplementation (as this term is defined in the Solvency Circular) as of the financial statements' publication date.
(2) Clal Insurance's Board ordered the deferral of interest payment or the deferral of principal payment, if it realized that there is a real imminent concern regarding Clal Insurance's ability to comply with the capital requirement for suspending circumstances, or to repay on time liabilities with higher priority than that of the bonds, provided that the Commissioner's advance approval was obtained.
(3) The Commissioner ordered the deferral of interest payment or the deferral of principal payment, if they realized that the solvency ratio was adversely affected or that there is a real imminent concern regarding Clal Insurance's ability to comply with the economic solvency capital requirement.

Such deferred principal and/or interest amounts, will accrue interest starting on the deferral date and through the actual payment date, at the interest rate payable on the bonds at that time.

Rating

Subsequent to the reporting date, on April 23, 2025, Midroog announced it was rating at Aa3.il(hyb), with a stable outlook, the subordinated notes of up to NIS 500 million p.v. raised by Clal Insurance through Clal Capital Raising by way of issuing a new series (Series N).

Subsequent to the reporting date, on April 23, 2025, S&P Maalot announced it was rating at ilAA-, with a stable outlook, the subordinated notes of up to NIS 500 million p.v. raised by Clal Insurance through Clal Capital Raising by way of issuing a new series (Series N).

C. Bonds and subordinated notes in Max

Max has subordinated notes with a contractual loss absorption mechanism, which are recognized as Tier 2 capital and commercial securities. The balance as of March 31, 2025, includes Subordinated Notes (Series D) with a contractual loss absorption mechanism of NIS 250 million par value, recognized as tier 2 capital from their issuance date - July 16, 2023, a commercial paper to institutional investors totaling NIS 230 million, whose issuance under a private placement was completed on January 4, 2024 and a NIS 316 million balance of commercial paper to institutional investors, issued in 2022.

The Subordinated Notes (Series D) bear fixed annual interest at a rate of 7.33%, and are repayable in one lump sum on October 16, 2033, and Max was given an option for early redemption between October 16, 2028 and November 16, 2028 in accordance with the terms and conditions set out in the deed of trust. If Max does not exercise the early redemption option, the interest will be revised on October 16, 2028, such that its annual rate will be equal to the benchmark interest rate on the date of the interest rate change as set out above, plus the margin above the benchmark interest rate on the issuance date, all in accordance with the definitions set out in the deed of trust. The Subordinated Notes (Series D) were issued to qualified investors in a private placement and were listed on the TACT-Institutional system of the Tel Aviv Stock Exchange. Subordinated Notes (Series D) include a contractual loss absorption mechanism, according to which if the circumstances for a trigger event exists (trigger event for non-compliance or trigger event for absorption of principal loss), a full or partial delisting of the subordinated notes will be performed, all according to the definitions and terms of the subordinated notes.

The increase in the balance of Bonds and Subordinated notes arises from a private placement of commercial papers to institutional entities, carried out by Max on January 6, 2025, by way of expansion of a series of commercial papers (CPs (Series 2)), totaling approx. NIS 154 million.

Subsequent to the reporting date, on April 24, 2025, it completed a NIS 207 million raising of CPs (Series 5) from institutional investors and - for the first time - also from the public. For further details, see Note 14(f).

D. Binding credit facilities

1. Credit facility for Clal Holdings

Further to Note 26(j)(1) to the Consolidated Financial Statements as of 2024, in June 2024, an Israeli banking corporation approved a credit facility to the Company totaling up to NIS 250 million for the purpose of providing it with another liquidity buffer, for one further year through June 2025. At the date of the report and at the date of the approval thereof, the Company has not utilized the aforesaid credit facility.

2. Credit facility for Max

For information regarding a credit facility to Max, see Note 26(j)(2) to the 2024 Consolidated Financial Statements.

2. Fair value of financial liabilities, by level

The following table presents an analysis of financial liabilities measured at fair value from time to time, using a valuation method according to the different hierarchy levels. For details regarding the hierarchy levels, see Note 2(e)(3) to the Consolidated Financial Statements for 2024.

		As of March 31, 2025
	Level 1	Level 2	Total
In NIS million		Unaudited
Derivatives		33	896	929
Liability for Repo		-	1,257	1,257
Total financial liabilities		33	2,153	2,186

		As of March 31, 2024
	Level 1	Level 2	Total
In NIS million		Unaudited
Derivatives		10	693	703
Liability for Repo		‐	671	671
Total financial liabilities		10	1,364	1,374

		As of December 31, 2024
	Level 1	Level 2	Total
In NIS million		Unaudited
Derivatives		17	511	528
Liability for Repo		‐	1,235	1,235
Total financial liabilities		17	1,746	1,763

H. Financial liabilities with respect to Max by level

	March 31, 2025
	On-balance	Fair value
	sheet balances	Level 1	Level 2	Level 3		Total
In NIS million	Unaudited
Financial liabilities
Credit from banking corporations	5,544		‐	5,544	‐	5,544
Payables for credit card transactions	9,903		‐	‐	9,847	9,847
Bonds and subordinated notes	940		‐	950	‐	950
Other financial liabilities	294		‐	1	293	294
Total financial liabilities	16,681		‐	6,495	10,140	16,635

		March 31, 2024
	On-balance		Fair value
	sheet balances	Level 1	Level 2		Level 3	Total
In NIS million	Unaudited
Financial liabilities
Credit from banking corporations	4,721		‐	4,721		‐	4,721
Payables for credit card transactions	9,050		‐	‐	8,996		8,996
Bonds and subordinated notes	788		‐	794		‐	794
Other financial liabilities	339		‐	-	339		339
Total financial liabilities	14,898		‐	5,515	9,335		14,850

	December 31, 2024
	On-balance	Fair value
	sheet balances	Level 1	Level 2		Level 3	Total
In NIS million	Unaudited
Financial liabilities
Credit from banking corporations	5,993		‐	5,995		‐	5,995
Payables for credit card transactions	9,678		‐		9,622 ‐		9,622
Bonds and subordinated notes	788		‐	798		‐	798
Other financial liabilities	296		‐		296 ‐		296
Total financial liabilities	16,755		‐	6,793	9,918		16,711

NOTE 6 - CAPITAL MANAGEMENT AND REQUIREMENTS

A. Share capital

	Ordinary shares ) *)
	March 31, 2025	March 31, 2024	December 31, 2024
	In thousands of shares of NIS 1 p.v.
Issued and paid-up share capital as of January 1		79,437 79,031
Issuance of shares		-	- -
Exercise of options for senior employees		86	36 406
Issued and paid-up share capital as of	79,523		79,067 79,437
Registered capital	100,000	100,000	100,000

*) The shares are listed on the Tel Aviv Stock Exchange (TASE). The holders of ordinary shares have the right to receive dividends as declared from time to time, voting rights at general meetings of the Company according to one vote per share, rights in the event of liquidation of the Company and the right to appoint directors for the Company.

**) For details regarding the option plan in the Group, which was approved in the Reporting Period, see Note 14(b) below.

B. Approval of the dividend distribution by the Company

Further to Note 17(c) to the Annual Financial Statements, in September 2024, the Company's Board of Directors approved a dividend distribution policy. This policy was approved, among other things, further to the approval of a dividend distribution policy in the Company's key subsidiaries - Clal Insurance and Max (see Section c below).

In accordance with the approved policy, the Company will distribute an annual dividend at a rate, which will not fall below 50% of the dividend received in that year from the Company's subsidiaries.

This policy should not be viewed as an undertaking by the Company to distribute dividends, and that any actual distribution shall be individually subject to the Board of Directors' approval, at its sole discretion; the Board of Directors may decide on actual distribution at different rates, or not to distribute any dividend. Furthermore, the execution of any actual distribution shall be subject to compliance with the provisions of laws applicable to any dividend distribution and to compliance with the financial covenants the Company has undertaken and/or will undertake in the future as to the condition that the distribution shall not adversely affect the Company's cash flows and the Company's need for cash to finance its activities, including future investments, as shall be from time to time, and/or its expected and/or planned future activities.

The Company's Board of Director may review the dividend distribution policy from time to time and decide, at any given time, taking into account business considerations and the legal and regulatory provisions applicable to the Company, to change the dividend distribution policy, including the rate of dividend to be distributed.

Further to the above, subsequent to the reporting date, on November 28, 2025, the Company's Board approved a dividend distribution totaling approx. NIS 200 million, which constitutes approx. 64% of the dividends declared and/or distributed in the Company's subsidiaries as of the approval date of the Consolidated Interim Financial Statements.

C. Dividends and capital management and requirements in the Group companies

Further to Note 17(c) and (d) of the Annual Financial Statements, the possibility of distributing dividends by the Company is affected by the ability of investees to distribute dividends, subject to their capital requirements and liquidity needs and Max's needs to service the debt it issued (for further details regarding the bonds issued by Max, see Note 6(c) above). Below is a description of the capital requirements of Clal Insurance and Max and details of the distribution of dividends by them.

Dividends and management of requirements in consolidated insurance companies

A. Solvency II-based economic solvency regime applicable to the Group's insurance companies

The Group's insurance companies are subject to the Solvency II-based Economic Solvency Regime in accordance with the implementation provisions of the Economic Solvency Regime.

On May 28, 2025, Clal Insurance approved its Economic Solvency Ratio Report as of December 31, 2024.

The calculation made by Clal Insurance as of December 31, 2024 was audited by the Company's independent auditors. The audit held in accordance International Standard on Assurance Engagement (ISAE) 3400 – "The Examination of Prospective Financial Information".

In accordance with the Solvency Ratio Report as of December 31, 2024, Clal Insurance has excess capital, both when calculation is made having no regard to the Transitional Provisions and when it is made taking into account the Transitional Provisions.

The calculation is sometimes based on assumptions regarding future events and steps taken by management, that will not necessarily materialize or will materialize in a manner different than the assumptions used in the calculation. Furthermore, actual results may substantively vary from the calculation, since the combined scenarios of events may materialize in a manner that is materially different than the assumptions made in the calculation.

For further details, see Section 2.4 to the Report of the Board of Directors and the Economic Solvency Ratio Report as of December 31, 2024 attached to this report.

B. Update of the capital target and dividend distribution policy of Clal Insurance

Further to Note 17(c)2 to the Consolidated Annual Financial Statements of 2024, in June 2023, the Board of Directors of Clal Insurance approved a policy for the distribution of a dividend at a rate of 30%-50% of Clal Insurance's comprehensive income. The distribution is subject to Clal Insurance's compliance with a minimum capital target pursuant to the economic solvency ratio regime, post-distribution, at a rate of 110%, without taking into account the Transitional Provisions, and at a rate of 135%, taking into consideration the Provisions for the Transitional Period.

On May 28, 2025, Clal Insurance revised the minimum capital target without taking into account the Transitional Provisions, such that subsequent to the dividend distribution the solvency ratio will be at least 115% compared to 110%.

This is further to setting a capital management policy whereby the target range for Clal Insurance's economic solvency ratio shall be 150%-170%, as approved in June 2021. In addition, the minimum economic solvency ratio target for prudential purposes is set at 135%. These targets relate to a solvency ratio taking into account the Deduction during the Transitional Period until the end of 2032 and thereafter.

It is noted that in February 2025, the Commissioner issued a letter regarding capital targets, which clarifies the appropriate practices for setting the capital targets. Clal Insurance intends to assess its targets bearing the letter in mind.

This policy should not be viewed as an undertaking by Clal Insurance to distribute dividends, and that any actual distribution shall be individually subject to the Board of Directors' approval, at its sole discretion; the Board of Directors may decide on actual distribution at different rates, or not to distribute any dividend. Furthermore, the execution of any actual distribution shall be subject to compliance with the provisions of laws applicable to any dividend distribution and to compliance with the financial covenants Clal Insurance has undertaken and/or will undertake in the future as to the condition that the distribution shall not adversely affect Clal Insurance's cash flows and Clal Insurance's need for cash to finance its activities, including future investments, as shall be from time to time, and/or its expected and/or planned future activities.

The Board of Directors of Clal Insurance may review the dividend distribution policy from time to time and decide, at any given time, taking into account business considerations and the legal and regulatory provisions applicable to Clal Insurance, to change the dividend distribution policy, including the rate of dividend to be distributed.

Subsequent to the above, on May 28, 2025, Clal Insurance's Board approved a dividend distribution of approx. NIS 300 million, which constitutes approx. 47% of Clal Insurance's 2024 comprehensive income in accordance with the Annual Financial Statements (approx. 25% of Clal Insurance's comprehensive income after application of IFRS 9 and IFRS 17, as detailed in Note 14 to the Interim Financial Statements), having examined all aspects, including Clal Insurance's compliance with the economic solvency ratio targets detailed above.

2. Dividends and management of capital requirements in Max

A. Dividend distribution policy and dividend distribution in Max

The dividend distribution by Max is subject to the directives of the Banking Supervision Department, including compliance with capital adequacy restrictions under the Basel directives. A dividend distribution is allowed subject to the provisions of the Companies Law, 1999, which stipulates, among other things, that Max may

make a distribution out of its earnings, provided that there are no reasonable concerns that the distribution will prevent Max from fulfilling its existing and future undertakings, when they fall due.

During the second quarter of 2024 Max agreed the cancellation of restrictions on dividend distribution, which were included in its financing agreements, and which were detailed in Note 17C.(3) In the 2024 Consolidated Financial Statements.

Both the set dividend distribution policy and the actual distribution which was approved were carefully considered, while retaining high capital surpluses in relation to Max's capital targets, in accordance with the regulator's expectation that the capital planning will be assessed in a conservative and informed manner in view of the War and the uncertainty in the Israeli economy.

B. Capital adequacy and leverage pursuant to the Banking Supervision Department directives applicable to credit card companies

			As of
	As of March 31		December 31
	2025	2024	2024
In NIS million		Unaudited
1. Capital for capital ratio calculation purposes:
Total CET1 capital, after regulatory capital adjustments and deductions	2,143	1,911	2,066
Tier 2 capital	466	437	466
Total overall capital	2,609	2,348	2,532
2. Balance of risk-weighted assets:
Credit risk - standardized approach	17,297	14,826	17,207
Market risks - standardized approach	124	128	55
Operational risk - standardized approach	3,454	2,989	3,347
Total balance of risk-weighted assets	20,875	17,943	20,609
	In %	In %	In %
3. Ratio of capital to risk-weighted assets:
Ratio of CET1 capital to risk-weighted components	10.3	10.6	10.0
Ratio of total capital to risk-weighted assets	12.5	13.1	12.3
Minimum CET 1 capital by the Banking Supervision Department	8.0	8.0	8.0
Minimum total capital ratio set by the Banking Supervision Department	11.5	11.5	11.5

**1. Capital adequacy, as per the Banking Supervision Department's directives (*)**

* Calculated in accordance with Proper Conduct of Banking Business Directives Nos. 201-211, "Capital Adequacy and Measurement", and Proper Conduct of Banking Business Directive No. 472 "Merchant Acquirers and Acquiring Payment Card Transactions", which came into effect on September 1, 2016.

2. Capital adequacy target in Max

As part of the process of adopting the provision of Basel III in Israel, on March 28, 2012, the Banking Supervision Department published a letter of instruction on the minimum core capital ratio in accordance with the Basel III framework, requiring banks and credit card companies to comply with a Common Equity Tier 1 capital ratio of 9% and a total capital ratio of 12.5% until January 1, 2015.

On May 2, 2016, the Banking Supervision Department issued Proper Conduct of Banking Business Directive No. 472, Merchant Acquirers and Acquiring Payment Card Transactions. The directive contains relief in respect of the capital requirements under Proper Conduct of Banking Business Directives 201-211. Despite that which is stated in Section 40 to Proper Conduct of Banking Business Directive No. 201, the Common Equity Tier 1 capital ratio shall not fall below 8%, and the total capital ratio shall not fall below 11.5%. The directive became effective on June 1, 2016 and applies to Max as an acquirer. ("Payment Services Provider with Prudential Importance").

In accordance with Max's risk profile, on June 30, 2024 Max's Board of Directors approved Max's CET1 capital ratio internal target at 9.25% instead of 10% as was the case through that date. The revised internal target is 125 basis points (1.25 percentage points) higher than the minimum CET 1 capital ratio set by the Banking Supervision Department. Max intends to hold a security buffer above the revised internal target. The internal target for total capital ratio has not changed and stands at 12%.

3. Capital components for the calculation of capital ratio in Max

			As of
	As of March 31		December 31
	2025	2024	2024
In NIS million	Unaudited
1. Common Equity Tier 1 capital
Equity	2,140	1,906	2,061
Total Common Equity Tier 1 capital	2,140	1,906	2,061
Regulatory adjustments:
Adjustments for current expected credit losses - CET1 capital**	3	5	5
Total CET1 capital, after regulatory capital deductions	2,143	1,911	2,066
2. Tier 2 capital
Tier 2 capital: Instruments	250	250	250
Tier 2 capital: Provisions	216	187	216
Total Tier 2 capital	466	437	466
Total overall capital	2,609	2,348	2,532

**) These data include adjustments in respect of the effect of first-time application of GAAP for current expected credit losses (hereinafter - "adjustments for expected credit losses"), which are gradually amortized until January 1, 2026.

4. Effect of adjustments for current expected credit losses on the CET1 capital ratio in Max

			As of
	As of March 31		December 31
	2025	2024	2024
In %	Unaudited
Ratio of capital to risk-weighted components
Ratio of CET1 capital to risk-weighted components, before the effect
of adjustments for current expected credit losses	10.2	10.6	10.0
Effect of adjustments for current expected credit losses	0.01	0.03	0.02
Ratio of CET1 capital to risk-weighted components	10.3	10.6	10.0

5. Leverage ratio in Max pursuant to the Banking Supervision Department directives

As from April 1, 2015, Max has been implementing Proper Conduct of Banking Business Directive No. 218 on leverage ratio (hereinafter - the "Directive"). The directive sets a simple, transparent and non-risk based leverage ratio to serve as a supplementary and reliable measure for risk-based capital requirements with the purpose of limiting excess leverage in banking corporations. The leverage ratio is expressed as a percentage, and is defined as the ratio between capital measurement and exposure measurement. The capital for the purpose of measuring the leverage ratio is Tier 1 capital as defined in Proper Conduct of Banking Business Directive No. 202. Max's total exposure is the sum of the on-balance sheet exposures and off-balance-sheet items. As a rule, the measurement is consistent with the accounting values, and no risk-weighting is applied. In addition, unless specifically permitted to do so under the Directive, Max may not use physical or financial collateral, guarantees or other credit risk mitigation techniques to reduce the exposure measurement. On-balance sheet assets deducted from Tier 1 capital (in accordance with Directive No. 202) are deducted from the exposure measurement. Pursuant to the Directive, Max calculates

the exposures for off-balance-sheet items by converting the sum of the items by credit conversion coefficients, as stipulated in Proper Conduct of Banking Business Directive No. 203.

Pursuant to the Directive, acquirers shall have a consolidated leverage ratio of no less than 5%.

In the circular amending the Directive, which was published by the Banking Supervision Department on December 20, 2023, it extended the term of an expedient set as a Temporary Order in November 2020, as part of adjustments to Proper Conduct of Banking Business Directives for dealing with the Covid-19 crisis, according to which the leverage ratio shall not fall below 4.5% on a consolidated basis. According to the circular, against the background of a review conducted by the Banking Supervision Department to amend the directive and a review of the leverage ratio and its mix, the above relief was extended as a temporary order until June 30, 2026, provided that the leverage ratio does not fall below that as of December 31, 2025 or the minimum leverage ratio applicable to the banking corporation prior to the temporary order, whichever is lower.

Following is the leverage ratio calculated in accordance with Proper Conduct of Banking Business Directive No. 218:

As of March 31		As of March 31	As of December 31
	2025	2024	2024
In NIS million		Unaudited
Consolidated data:
Tier 1 capital	2,142	1,911	2,066
Total exposures	23,975	21,367	23,825
	In %	In %	In percentage
Leverage ratio	8.9		8.9 8.7
Minimum total leverage ratio set by the Banking Supervision Department	4.5		4.5 4.5

*In accordance with the Temporary Order as stated above.

NOTE 7 - INCOME (LOSS) FROM INSURANCE SERVICES AND REINSURANCE

Life Health P&C Insurance Insurance InsuranceTotal In NIS million Unaudited Revenues from insurance services Contracts to which the Premium Allocation Approach (PAA) was not applied Amounts relating to changes in liability for remaining coverage (LRC): The contractual service margin (CSM) amount recognized in profit or loss for 106 120 226 services provided ‐ 11 12 23 Change in risk adjustment (RA) for non-financial risk resulting from past risks ‐ Claims and other expected insurance service expenses incurred 562 332 894 ‐ Experience adjustments arising from premiums (3) (4) (7) ‐ Allocation of the portion of the premiums that relate to the recovery of insurance acquisition cash flows. 29 27 56 ‐ Total contracts to which the Premium Allocation Approach (PAA) was not applied 705 487 1,192 ‐ Contracts to which the Premium Allocation Approach (PAA) was applied 29 956 985 ‐ Total revenues from insurance services 705 516 956 2,178 ‐ Expenses from insurance services ‐ Claims and other insurance service expenses incurred 575 365 658 1,598 Changes relating to past service - adjustment for liabilities for incurred claims (LIC) 18 14 (36) (4) Losses (reversal of losses) for groups of onerous insurance contracts 4 (3) (2) (1) Amortization of insurance acquisition cash flows 29 37 158 224 Total expenses from insurance services 626 413 778 1,817 Income from insurance services before reinsurance contracts held 79 103 178 361 Revenues (expenses), net for reinsurance contracts held Reinsurance expenses: The contractual service margin (CSM) amount recognized in profit or loss for services received 4 4 8 ‐ Change in risk adjustment (RA) for non-financial risk resulting from past risks 1 1 ‐ ‐ Recoveries of claims for underlying insurance contracts and other expected insurance services expenses incurred 42 8 ‐ 50 Experience adjustments arising from premiums ‐ 1 ‐ 1 Total contracts to which the Premium Allocation Approach (PAA) was not applied 46 14 ‐ 60 Contracts to which the Premium Allocation Approach (PAA) was applied 1 ‐ 289 290 Total reinsurance expenses 47 14 289 350 Reinsurance revenues: Recoveries of claims for underlying insurance contracts and other insurance services expenses incurred 51 7 191 249 Changes relating to past service - adjustment for assets for incurred claims (4) (12) (7) (23) Recoveries of losses (reversal of losses) for groups of onerous underlying insurance contracts (1) (1) ‐ ‐ Total reinsurance revenues 47 (5) 183 225 Total revenues (expenses) for reinsurance contracts held (19) (106) (124) ‐ Income (loss) from insurance services 79 85 72 236	For the three-month period ended March 31, 2025

		For the three-month period ended March 31, 2024
	Life	Health	P&C
	Insurance	Insurance		InsuranceTotal
In NIS million		Unaudited
Revenues from insurance services
Contracts to which the Premium Allocation Approach (PAA) was not applied
Amounts relating to changes in liability for remaining coverage (LRC):
The contractual service margin (CSM) amount recognized in profit or loss for
services provided		90	102	‐	192
Change in risk adjustment (RA) for non-financial risk resulting from past risks		11	12	‐	23
Claims and other expected insurance service expenses incurred	539		303	‐	842
Experience adjustments arising from premiums		(3)	1	‐	(2)
Allocation of the portion of the premiums that relate to the recovery of insurance acquisition cash flows.		23	18	‐	41
Total contracts to which the Premium Allocation Approach (PAA) was not applied	660		435		‐1,095
Contracts to which the Premium Allocation Approach (PAA) was applied		‐	18	916	934
Total revenues from insurance services	660		454		9162,030
Expenses from insurance services					‐
Claims and other insurance service expenses incurred	582		319		‐ 6121,513
Changes relating to past service - adjustment for liabilities for incurred claims (LIC)	(42)		23	(34)	(53)
Losses (reversal of losses) for groups of onerous insurance contracts		9	1	(8)	2
Amortization of insurance acquisition cash flows		23	25	156	204
Total expenses from insurance services	572		366		7271,666
Income from insurance services before reinsurance contracts held *		88	87	189	364
Revenues (expenses), net for reinsurance contracts held
Reinsurance expenses:
The contractual service margin (CSM) amount recognized in profit or loss for
services received		5	4	‐	9
Change in risk adjustment (RA) for non-financial risk resulting from past risks		3	1	‐	4
Recoveries of claims for underlying insurance contracts and other expected insurance
services expenses incurred		46	6	‐	52
Experience adjustments arising from premiums		14	1	‐	15
Total contracts to which the Premium Allocation Approach (PAA) was not applied		68	12	‐	80
Contracts to which the Premium Allocation Approach (PAA) was applied		1	1	303	305
Total reinsurance expenses		69	13	303	385
Reinsurance revenues:
Recoveries of claims for underlying insurance contracts and other insurance services
expenses incurred		44	5	163	212
Changes relating to past service - adjustment for assets for incurred claims		(2)	1	(7)	(8)
Recoveries of losses (reversal of losses) for groups of onerous underlying
insurance contracts		1	‐	(2)	(1)
Total reinsurance revenues		44	6	154	203
Total revenues (expenses) for reinsurance contracts held	(25)		(7)	(149) (181)
Income (loss) from insurance services		63	80	40	184

	For the year ended December 31, 2024

	Life	Health	P&C
	Insurance	Insurance	InsuranceTotal
In NIS million		Unaudited
Revenues from insurance services
Contracts to which the Premium Allocation Approach (PAA) was not applied
Amounts relating to changes in liability for remaining coverage (LRC):
The contractual service margin (CSM) amount recognized in profit or loss for
services provided	366	461	‐	827
Change in risk adjustment (RA) for non-financial risk resulting from past risks	49	46	‐	95
Claims and other expected insurance service expenses incurred	2,164	1,223		‐ 3,387
Experience adjustments arising from premiums	(21)	18	‐	(3)
Allocation of the portion of the premiums that relate to the recovery of insurance acquisition
cash flows.	97	86	‐	183
Total contracts to which the Premium Allocation Approach (PAA) was not applied	2,656	1,835		‐ 4,491
Contracts to which the Premium Allocation Approach (PAA) was applied	‐	124		3,777 3,901
Total revenues from insurance services	2,656	1,959		3,777 8,392
Expenses from insurance services
Claims and other insurance service expenses incurred	2,280	1,352		2,611 6,243
Changes relating to past service - adjustment for liabilities for incurred claims (LIC)	24	22		(636) (590)
Losses (reversal of losses) for groups of onerous insurance contracts	9	9	(4)	14
Amortization of insurance acquisition cash flows	97	127	674	898
Total expenses from insurance services	2,409	1,510		2,645 6,565
Income from insurance services before reinsurance contracts held	246	450		1,132 1,828

Revenues (expenses), net for reinsurance contracts held Reinsurance expenses:
Contracts to which the Premium Allocation Approach (PAA) was not applied
The contractual service margin (CSM) amount recognized in profit or loss for
services received	18	18	‐	36
Change in risk adjustment (RA) for non-financial risk resulting from past risks	13	4	‐	17
Recoveries of claims for underlying insurance contracts and other expected insurance
services expenses incurred	145	25	‐	170
Experience adjustments arising from premiums	50	14	‐	64
Total contracts to which the Premium Allocation Approach (PAA) was not applied	226	61	‐	287
Contracts to which the Premium Allocation Approach (PAA) was applied	4	1		1,148 1,153
Total reinsurance expenses	230	62		1,148 1,441
Reinsurance revenues:
Recoveries of claims for underlying insurance contracts and other insurance services
expenses incurred	145	30	788	963
Changes relating to past service - adjustment for assets for incurred claims	38	7		(325) (280)
Recoveries of losses (reversal of losses) for groups of onerous underlying
insurance contracts	‐	‐	‐	‐
Total reinsurance revenues	183	37	463	683
Total revenues (expenses) for reinsurance contracts held	(47)	(26)		(685) (758)
Income (loss) from insurance services	199	424		447 1,071

NOTE 8 - INCOME (LOSS) FROM INVESTMENTS AND FINANCING, NET

A. Income (loss) from investments and financing, net, by operating segments

	For the three-month period ended March 31, 2025
	Life Insurance and Long Health Term Savings	P&C Insurance	Insurance Other		Total
In NIS million		Unaudited
Investment gains (losses), net:
Investment gains (losses), net from assets held against insurance contracts and yield-dependent investment contracts	148	3	‐	‐	151
Gains (losses) from other investments, net:
Interest revenues calculated using the effective interest method	85	‐	‐	‐	85
Other investment income (losses), net	(137)	36	36	115	51
Share in profits (losses) of equity-accounted subsidiaries closely related to the investing activity	(1)	‐	(1)	1	(1)
Total gains (losses) from other investments, net	(53)	36	35	116	135
Total investment gains (losses), net recognized in the statement of income	95	39	35	116	285
Investment gains (losses), net recognized in other comprehensive income	1	‐	1	1	3
Total investment gains (losses), net	96	39	35	117	288
Finance expenses, net arising from reinsurance contracts: Change in liabilities for insurance contracts arising from changes in the fair value of underlying items of VFA contacts	130	-	-	-	130
Effects of the risk mitigation option for VFA contracts	2	-	-	-	2
Interest accrued	148	50	26	‐	224
Effects of changes in interest rates and other financial assumptions (including inflation assumptions)	(357)	(45)	(9)	‐	(411)
Effect of the difference between discounting with the current rate and discounting with the original rate of the changes in FCF charged to CSM	(2)	6	‐	‐	4
Total finance expenses, net arising from insurance contracts recognized in profit or loss	(79)	11	17	‐	(51)
Finance income, net arising from insurance contracts:
Interest accrued	(2)	2	11	‐	11
Effects of changes in interest rates and other financial assumptions (including inflation assumptions)	(4)	(2)	(5)	‐	(11)
Total finance income, net arising from reinsurance contracts recognized in the Statement of Income	(6)	‐	7	‐	1
Decrease (increase) in liabilities for investment contracts due to the yield component	(36)	-	-	-	(36)
Total income (loss) from investments and financing, net, recognized in the Statement of Income	132	29	25	116	302

	For the three-month period ended March 31, 2024
	Life Insurance and Long Term Savings	Health Insurance	P&C Insurance Other		Total
In NIS million			Unaudited
Investment gains (losses), net:
Investment gains (losses), net from assets held against insurance contracts and yield-dependent investment contracts	3,733	50		‐ ‐	3,783
Gains (losses) from other investments, net:
Interest revenues calculated using the effective interest method	42		‐	‐ ‐	42
Other investment income (losses), net	475	84	94	102	755
Share in profits (losses) of equity-accounted subsidiaries closely related to the investing activity	1		‐	‐ (1)	(1)
Total gains (losses) from other investments, net	516	84	94	100	795
Total investment gains (losses), net recognized in the statement of income	4,249	134	94	100	4,578
Total investment gains (losses), net	4,249	134	94	100	4,578
Finance expenses, net arising from reinsurance contracts: Change in liabilities for insurance contracts arising from changes in the fair value of underlying items of VFA contacts	2,941		‐	‐ ‐	2,941
Effects of the risk mitigation option for VFA contracts	73		‐	‐ ‐	73
Interest accrued	152	52	26	‐	230
Effects of changes in interest rates and other financial assumptions (including inflation assumptions)	367	119	28	‐	514
Effect of the difference between discounting with the current rate and discounting with the original rate of the changes in FCF charged to CSM	(1)	(4)		‐ ‐	(5)
Total finance expenses, net arising from insurance contracts recognized in profit or loss	3,532	167	53	‐	3,752
Finance income, net arising from insurance contracts:
Interest accrued	(4)	3	11	‐	10
Effects of changes in interest rates and other financial assumptions (including inflation assumptions)	‐	9	11	‐	20
Total finance income, net arising from reinsurance contracts recognized in the Statement of Income	(4)	12	23	‐	31
Decrease (increase) in liabilities for investment contracts due to the yield component	(617)		‐	‐ ‐	(617)
Total income (loss) from investments and financing, net, recognized in the Statement of Income	96	(21)	63	100	239

	For the year ended December 31, 2024
	Life Insurance and Long Term Savings	Health Insurance	P&C Insurance Other		Total
In NIS million		Unaudited
Investment gains (losses), net:
Investment gains (losses), net from assets held against insurance contracts and yield-dependent investment contracts	10,492	142	‐	‐	10,635
Gains (losses) from other investments, net:
Interest revenues calculated using the effective interest method	220	‐	‐	‐	220
Other investment income (losses), net	1,600	314	270	593	2,777
Share in profits (losses) of equity-accounted subsidiaries closely related to the investing activity	(1)	‐	(2)	‐	(1)
Total gains (losses) from other investments, net	1,820	314	269	593	2,996
Total investment gains (losses), net recognized in the statement of income	12,312	456	269	593	13,630
Investment gains (losses), net recognized in other comprehensive income	‐	‐	‐	(1)	(1)
Total investment gains (losses), net	12,312	456	269	592	13,629
Finance expenses, net arising from reinsurance contracts: Change in liabilities for insurance contracts arising from changes in the fair
value of underlying items of VFA contacts	8,444	‐	‐	‐	8,444
Effects of the risk mitigation option for VFA contracts	211	‐	‐	‐	211
Interest accrued	601	215	101	‐	918
Effects of changes in interest rates and other financial assumptions (including inflation assumptions)	1,045	216	171	‐	1,432
Effect of the difference between discounting with the current rate and discounting with the original rate of the changes in FCF charged to CSM	(12)	49	‐	‐	36
Total finance expenses, net arising from insurance contracts recognized in profit or loss	10,289	480	272	‐	11,041
Finance income, net arising from insurance contracts:
Interest accrued	(17)	8	44	‐	34
Effects of changes in interest rates and other financial assumptions (including inflation assumptions)	18	24	72	‐	114
Effect of the difference between discounting with the current rate and discounting with the original rate of the changes in FCF charged to CSM	(1)	1	‐	‐	‐
Total finance income, net arising from reinsurance contracts recognized in the Statement of Income	‐	33	116	‐	149
Decrease (increase) in liabilities for investment contracts due to the yield component	(1,660)	‐	‐		‐ (1,660)
Total income (loss) from investments and financing, net, recognized in the Statement of Income	363	8	113	595	1,078

NOTE 9 - CONTINGENT LIABILITIES AND CLAIMS

1. Preamble - Claims not in the Ordinary Course of Business

Following are details regarding legal actions not in the ordinary course of business, as follows: material claims¹ which may be derivative actions, actions whose filing as class actions has been certified; pending motions for certification of material claims as class actions; material and immaterial class actions which were concluded during the reporting period and until its signing and other material claims against the Group companies (hereinafter - "Claims not in the Ordinary Course of Business" or "Claims").

The following claimed amounts are presented in amounts that are correct as of the date of their filing, and as detailed by the plaintiffs, unless noted otherwise.²

It is noted, as a general rule, that the exposure to financial demands, either specific or general, is subject to the laws of prescription. The prescription periods in respect of Claims for insurance benefits in the insurance products vary according to the type of product and the event in respect of which the claim of prescription has been raised. The exposure due to prescription is especially intense in those insurance sectors with "long-tail claims" and long-term insurance policies, in Life Insurance and Health Insurance, in which Clal Insurance operates. In legal actions not pertaining to insurance benefits, the prescription period is pursuant to what is prescribed in the Prescription Law, 1985. In February 2024, in view of the Iron Swords War, an amendment to the prescription period was approved, primarily stating that the period from October 7, 2023 to April 6, 2024 will not be taken into account in the calculation of the prescription period required by law, subject to the established exceptions. The period of time required to investigate the claim, which on occasions may be long, particularly in class actions, extends the period in respect of which refund or compensation need to be effected, as part of the prescription period.

1.1 General details regarding class actions

As part of a general trend in those markets in which the Group operates, a significant number of class action certification motions have been filed in past years against the Group companies, and as a result, there has been an increase in the number of actions filed against the Group companies that have been recognized as class actions by the courts. This trend, which is the result, among others, of the enactment of the Class Actions Law, 2006 (hereinafter - the "Law"), the growing number of legal actions and the approach of the courts, substantially increases the Company's potential of exposure to losses due to rulings against the Group's members in class actions filed against them. However, there was a decline in the total number of class certification motions filed against Group companies in the reporting year. The Group cannot assess whether this trend will continue in the coming years.

A class action lawsuit, as it is defined in the Law, is a lawsuit managed on behalf of an anonymous class of persons, who have not granted power of attorney in advance to the lead plaintiff for that purpose, and which raises material questions of fact or law that are common to all the class members, under which a motion to certify is first heard. Only if the class action certification motion is granted will the claim be defined as a "class action", and the plaintiff will then become a "class plaintiff".

It is noted that the scope and content of the hearing regarding a class action on its merits, is affected by the ruling approving a motion to certify. The ruling to certify a class action usually relates to both the causes of action that have been approved and those that have not; the reliefs that have been approved and those that have not; etc.

Further to the Report of the Inter-Ministerial Taskforce on Assessing the Arrangements Set in the Class Actions Law, 2006, published in May 2023, in July 2024, the Class Actions Bill (Amendment No. 16), 2024 was published, which suggests to pass into law the Taskforce's recommendations.

As part of the bill proposes, among other things, to add a mechanism requiring that an advance contact be made with a defendant prior to filing a motion to certify, regarding specific types of causes of action and claims; to authorize the court to strike out oppressive and vexatious motions at any time; to set uniform and clear rules regarding compensation and legal fees, including cancellation of the option for a compensated withdrawal; to set mechanisms pertaining to compensation between class members; to generally authorize the court to impose legal fees on applicants or their attorneys; to require a lead plaintiff to note the number of class actions they filed in a calendar year and to limit this number to 5 actions per year; and to set a requirement to take other considerations into account, when hearing a certification motion against an insurer or a management company on the grounds of breaching the long-term savings contract (as defined in the draft bill), such as the existence of a regulatory approval

^1. See Footnotes 3 and 16 below.

^2. See Footnote 12.

for the relevant action, the time, which has elapsed since the contract was signed; the extent of the damage to the insurer/management company if the motion is certified, and the interests of the class members in the certification of the motion; it also proposes that delaying the motion to certify for these reasons shall be subject to approval by the Attorney General.

At this preliminary stage, the Company is unable to assess the effects of the above proposed provisions, whose effect on the scope of Group companies' exposure to class actions depends on various factors.

The motions to certify claims as class actions detailed below, are currently in the various stages of procedural adjudication, some have been approved and some are undergoing appeal proceedings.

1.2 Additional exposures

It is noted that in addition to the legal proceedings, from time to time there are potential exposures which cannot currently be evaluated or quantified, in respect of commercial disputes or warnings pertaining to the intention to file suits, including class actions and derivative actions on certain matters, or legal proceedings and specific inquiries that may develop into claims in the future, including class actions or third party notices against the Group's member companies, as well as exposure resulting from the complexity of the regulation applying to the activity of the Group's member companies.

The Group's member companies are unable to predict in advance whether a customer's claim which has been brought to the companies' attention will eventually lead to the filing of a class action lawsuit, or will lead to a sectorwide ruling or will have sector-wide implications, even in those cases in which the customer threatens to do so, and furthermore the Group's member companies cannot estimate the potential exposure that may be created in respect of the aforementioned claims, insofar as these may be adjudicated and found to be justified by a competent authority. For details, see Section 2.2.2 below.

The following are details of lawsuits outside the ordinary course of business, as detailed below, that had been brought against the Company and its consolidated companies, divided into Max and the consolidated companies in Max's statements (hereinafter - the "Max Group Companies") and the other Group companies.

2. Exposures against the Company and the consolidated companies, not including the Max Group Companies

Following are details regarding material lawsuits³ that have been certified as class action lawsuits (Section 2.1.1), pending motions to certify material lawsuits as class actions (Section 2.1.2), and material class actions, material claims and motions to certify material claims as class actions that had concluded during the reporting period and until the report was signed (Section 2.1.3), exposures due to immaterial class actions or class actions that have not yet been filed, and exposure due to regulatory provisions (Section 2.2), additional exposures (including claims) (Section 2.3) which were all brought against the Company and/or the consolidated companies, except the Max Group Companies.

^3. It is noted that, in general, in this note, a claim is considered material and described according to a qualitative or quantitative assessment that the Company makes when receiving the claim. With respect to the quantitative assessment, insofar as the actual exposure amount, net of tax, crosses the Group's materiality threshold for the purpose of profit – assuming the claim is deemed justified and without going into the claim's odds or the amount specified therein on their merits – according to the calculated projected comprehensive loss, divided by the average annual comprehensive income or comprehensive loss in the last three years, calculated using the last 12 quarters for which reviewed or audited financial statements were published; it is clarified that the profit/loss attributable to the event and the profit/loss in each quarter are calculated according to their absolute value. The above classification is made as of the date of filing the lawsuit. However, as legal proceedings can extend and unfold, sometimes over years, a claim that was not considered material at the time of filing may subsequently become material, in which case disclosure will be made with respect to it at a later date. In addition, a claim may be considered material for the purpose of such a disclosure if the Company is unable to assess the total exposure.

2.1. Class actions against the Company and the consolidated companies, with the exception of the Max Group companies

2.1.1 Material claims whose filing as class actions was certified, against the Company and the consolidated companies, with the exception of the Max Group companies

Following are details of material claims that were certified as class actions and are at various stages of litigating the respective proceeding on its merits, including inquiry into the substantive claim before the court of first instance or the appellate court after the ruling to certify the claim or dismiss it has been rendered, or after a judgment that granted or dismissed the lawsuit has been rendered.

	Date and		Key claims and	Key	Represented		Claimed
1.	court	Defendants	causes of action	remedies	class	Status / further details	amount
	5/2013	Clal	According to the	Charge the	According to the	In August 2015, the District Court rendered its ruling to dismiss the motion to certify against the defendants	The plaintiff
		Insurance	plaintiff, the	defendants to	ruling - all	with respect to the claim of non-payment of linkage differentials, but accept the motion to certify against the	estimates the
	District	and	defendants are in	pay the class	Entitled Parties	defendants with respect to the claim of underpaying interest on insurance benefits; it was found that the	cumulative
	Court -	additional	breach of their duty	members	who, during the	eligible class members are all policyholders, beneficiaries, or third parties, who, during a period starting three	amount due to the
	Tel Aviv	insurance	to add linked interest	linkage	period	years before the lawsuit had been filed and ending on the day the lawsuit was certified as a class action,	First Class at NIS
		companies	as well as the lawful	differentials	commencing	had been paid insurance benefits from the defendants (unless the above were paid not in accordance with	518 million (if it is
			linkage differentials	and interest	three years prior	a judgment rendered between them), without adding the lawful interest, within 30 days from the date of	decided that the
			in respect of the	due to the	to bringing the	submitting the insurance claim with the insurer (not from the date of submitting the last document the insurer	interest must be
			insurance benefits	underpayment	lawsuits (filed	had required to clarify the liability), and until the actual payment date. In August 2016, the defendants, with	calculated from
			they pay. According	. In addition	against Clal	the Supreme Court's approval, had stricken out a motion for leave to appeal they had brought, whose gist	the insured
			to the plaintiffs, the	and/or	Insurance in May	was an objection to the District Court's ruling, according to which a prior settlement arrangement the	event's
			date from which	alternatively,	2013) and	Company had made on a similar issue does not establish res judicata that precludes bringing the motion to	occurrence date),
			interest and linkage	the court is	ending on the	certify and does not establish a defense for the defendants, while the parties reserved all their claims to the	or at NIS 210
			differentials should	asked to order	day of rendering	main proceeding.	million (if it is
			be calculated is the	damages to	the Judgment,	In February 2021, a partial judgment was rendered, in which the court determined that the class action was	decided that the
			insured event's	the public, as	were paid	granted, and charged the defendants recovery of interest differentials to the class members, as detailed in	interest must be
			occurrence date,	it deems	insurance	the judgment (hereinafter - the "Judgment"). In accordance with the Judgment, it was found that the "day	calculated starting
			until the actual	suitable.	benefits from the	of filing an insurance claim," on which the 30-day race begins and after which linked interest must be added	30 days from the
			payment date.		defendants, not	to the insurance benefits in accordance with the provisions of Section 28(a) of the Insurance Contract Law,	date of filing the
			Alternatively, linkage		in accordance	1981 (hereinafter - the "Insurance Contract Law"), is the date the insurance company or the insurance	insurance claim to
			differentials must be		with a judgment	agent, whichever is earlier, first receive an inquiry indicating that the policyholder, a third party, or the	the insurance
			paid from the		in their case,	beneficiary (hereinafter - "Entitled Parties"), wish to be paid the insurance benefits, without needing to	company).
			insured event's		without the lawful	attach any document.	The plaintiff
			occurrence date and		interest added to	It was further determined that when the insurance benefits are calculated at their value on a date after the	estimates the
			until the actual		them.	insured event's occurrence, interest will be added to them only from that date, and with respect to recovery	cumulative
			payment date, and			of funds paid to service providers in a deferred payment – the interest differentials would be calculated	amount due to the
			interest must be paid			starting from the actual payment date.	Second Class (for
			starting 30 days from			It was also determined that for the purpose of implementing the Judgment and calculating the total damages	which the motion
			the date of			to the class members in accordance with the principles set forth in the partial judgment, an expert must be	to certify was
			submitting the			appointed, and that the reward payable to the lead plaintiffs and their counsels' legal fees would be	denied) at an
			insurance claim until			determined in the final judgment.	additional amount
			the actual payment			In May 2021, the defendants filed an appeal, or, alternatively, a motion for leave to appeal the Judgment to	of NIS 490 million,
			of insurance			the Supreme Court. In November 2022, the Supreme Court dismissed the motion for leave to appeal, mainly	due to linkage
			benefits.			since the partial ruling constitutes a "an interim ruling", which the Court rarely intervenes in.	differentials.
						The proceeding is at the stage of litigating the claim before the District Court, and in January 2023, within
						the above, the court handed down its ruling on the identity of and powers vested in the expert, and the expert
						has begun to conduct the tests. In April 2024, the Court issued its ruling regarding the clarification motions
						submitted by the defendants, and dismissed some of them. In February 2025, the Court issued to the expert
						instructions as to how to implement its rulings.
						The parties have notified the Court that they are conducting a mediation proceeding regarding this lawsuit.

	Date and
2.	court		Defendants Key claims and causes of action Key remedies		Represented class	Status / further details	Claimed amount
	1/2008	Clal	According to the plaintiff, the	Refund of all the	According to the court's	In July 2016, the court certified the lawsuit as a class action.	The amount claimed
		Insurance	defendants charge sub-annuals, a	amounts the	decision - anyone who entered	The court rendered the ruling notwithstanding the Commissioner's	from Clal Insurance
	District	and	payment which is collected in life	defendants had	into an insurance contract with	position, which had been issued at the court's request, in which the	was revised and set at
	Court -	additional	insurance policies in which the	collected	the defendants or any of them	Commissioner concurred with the insurance companies' position.	approx. NIS 398.2
	Tel Aviv	insurance	insurance rate is determined as an	unlawfully, as	and was charged Sub-Annuals	In December 2016, the defendants filed a motion for leave to appeal	million.
		companies	annual amount but the payment is	well as a	with respect to the following	against the ruling to certify the claim as a class action to the Supreme
			made in several installments	mandatory	components: with respect to the	Court (hereinafter - "MLA"), and in May 2018, the Supreme Court
			(hereinafter - "Sub-Annuals"), at	injunction	"mixed" life insurance savings	accepted the MLA, heard it as an appeal, and rendered a judgment
			an amount that exceeds the	ordering the	component sold by Clal	granting the appeal and dismissing the lawsuit accordingly.
			permitted amount, and they do so,	defendants to	Insurance in the past, with	In June 2018, the plaintiffs moved to hold a further hearing of the
			allegedly, in several methods:	change their	respect to the "policy factor"	judgment, with respect to some of the findings therein. In February 2020,
			collecting Sub-Annuals with	modus operandi	(which is a fixed monthly	a position was submitted to the Supreme Court on behalf of the Attorney
			respect to the "policy factor"	with respect to	amount which is added to the	General within the further hearing, according to which, the Attorney
			component, collecting Sub	the matters	premium whose aim is to cover	General believed that there was no justification to intervene with the
			Annuals at a rate that exceeds the	specified in the	expenses), and with respect to	ruling rendered in the judgment on the appeal, which was based on
			permitted rate in accordance with	lawsuit.	health policies, permanent	adopting the Capital Market Authority's interpretive position.
			the Insurance Supervision circulars, collecting Sub-Annuals		health policies, critical illness policies, permanent health	In July 2021, a judgment was rendered in the petition for a further hearing, stating that the ruling that certified the lawsuit as a class action
			with respect to the savings		policies, and long-term care	would be reinstated, such that the motion to certify would be granted and
			component in life insurance		policies (hereinafter - the	the case would be returned to the District Court to hear the class action
			policies, and collecting Sub		"Collection Components").	lawsuit on its merits.
			Annuals with respect to non-life			The proceeding is currently being litigated before the District Court.
			insurance policies.			The parties are conducting a mediation procedure.

Date and		Key claims and causes of
3. court	Defendants	action	Key remedies	Represented class	Status / further details	Claimed amount
7/2014	Clal Pension	According to the plaintiffs, the	To require the	According to the court's	In September 2015, the plaintiffs submitted a reply to the defendants'	At the motion filing date,
	and Provident	defendants raised the	defendants to return	decision - anyone who is	response to the motion to certify (hereinafter - the "Plaintiffs' Response"),	the plaintiffs estimated the
	Funds Ltd. as	management fees it charged	the excess	a planholder in a new	in which, among other things, a new claim was raised: that the defendants	management fees the
	well as	from pensioners in the	management fees	comprehensive pension	did not send the planholders prior notice of raising the management fees,	defendants collected
	against four	pension funds they manage at	unlawfully charged	fund managed by one of	as required in accordance with the provisions of the law. As per the court's	unlawfully from current
	other pension	the stage of paying the	from the class	the respondents and is	request, the Commissioner submitted its position in September 2017, which	pensioners at NIS 48
	fund	pension, to the maximum	members with	entitled to be paid an old	held, inter alia, that management fees lower than 0.5% could be collected	million; the management
	management	lawful management fees	interest and linkage;	age pension after they	during the pension payment period and that the defendants had no	fees to be unlawfully
	companies.	ceiling (0.5% of the	to require the	retire in the seven years	regulatory duty to notify of a management fee increase once the	collected from current
		accumulated balance), while	defendants to lower	prior to submitting the	planholders reached retirement age.	pensioners in the future
		taking advantage of the	the management	motion to certify and/or	In March 2022, the District Court decided to grant the motion to certify	by the defendants were
		pensioners' position as a	fees charged to the	will be entitled to be paid	against the defendants, with respect to whether the defendants had had to	estimated at NIS 152
		"captive audience," while	pensioners, such	an old-age pension in the	notify the planholders of the management fees they would be charged in	million; and the
		active planholders paid	that they do not	future. It is noted that	the pension period in advance, and if so, what damage had been caused	management fees to be
		significantly lower	exceed the	pension beneficiaries	by the failure to provide such a notice.	collected unlawfully from
		management fees, on	management fees it	who retired in the latter	The lawsuit is currently being litigated on its merits, and the parties are	future pensioners in the
		average. It was further	charged before each	half of 2018 will be given	conducting a mediation proceeding at the same time.	future were estimated by
		claimed that the defendants	one of them retired;	notice in accordance with		the defendants at NIS
		do not disclose to their	to prohibit the	the standard-conforming		2,800 million. The said
		planholders that when they	defendants from	bylaws the regulator had		amounts are claimed with
		become pensioners, the	raising the	published, that came into		respect to all the
		management fees they pay	planholders'	force starting in that year.		defendants.
		the defendants would	management fees
		immediately be raised to the	immediately before
		maximum management fees.	they retire.

	Date and
4.	court	Defendants	Key claims and causes of action Key remedies		Represented class	Status / further details	Claimed amount
	9/2015 District Court - Central	Clal Insurance and three other insurance companies	According to the plaintiffs, when the defendants give a score for the "incontinence" function within examinations of claims for insurance benefits under long-term care policies, they apply an interpretation according to which, in order for a policyholder's claim due to "incontinence" to be recognized, it must be the result of a urological or gastroenterological illness or defect, rather than assigning the function a score even when the source of the policyholder's poor medical and functional condition due to which he or she suffers from "incontinence" may be an illness, accident, or health defect outside the domain of urology or gastroenterology.	To compel the defendants to compensate the class members in full for the damage caused to the latter due to the defendants' alleged breaches of the agreement, and to comply with the agreement from here on out, and alternatively, to award any other remedy as the court deems suitable under the circumstances.	According to the court's decision, any policyholder of long-term care insurance who suffered a loss of bowel or bladder control, due to a combination of incontinence that does not amount to an organic loss of control with a poor functional condition, and regardless of the aforesaid did not receive from the insurance companies points for incontinence when examining their claim to receive long-term care insurance benefits, such that their rights to insurance benefits were jeopardize between September 8, 2012 and the date of certifying the claim as a class action.	In April 2020, the court partially certified the lawsuit as a class action lawsuit against Clal Insurance and three other insurance companies. The plaintiffs' motion to certify the lawsuit as a class action lawsuit in respect of a class of policyholders who suffer from incontinence due to functional disabilities or mobility impairments, and experience incontinence due to this, as well as in respect of a class of policyholders who suffer from cognitive impairments and who were not recognized as "mentally frail," was denied. The causes of action for which the class action was certified were a breach of the long-term care insurance contract that resulted in non-payment of long-term care insurance benefits or underpayment of long-term care insurance benefits, due to the policyholders not being recognized as qualifying for a score on their incontinence. The proceeding is currently being litigated. The parties are in mediation.	According to the plaintiffs, the damage cannot be estimated, but estimated it in the tens and even hundreds of millions of shekels.

5.	Date and court	Defendants	Key claims and causes of action Key remedies		Represented class	Status / further details	Claimed amount
	10/2016 District Court - Central	Clal Insurance	According to the plaintiff, within an engagement with a collective policy master policyholder (a health maintenance organization) for the sale of a collective long term care insurance policy, Clal Insurance had committed to give the collective policyholders who enroll in the private policy a 20% discount on the premium, and did not do so (hereinafter - the "Collective Policy").	Refund of the amounts by which the class members were overcharged.	In accordance with the court's ruling – anyone who bought an individual long term care insurance policy from Clal Insurance in which the eligibility period is lifetime compensation, between October 30, 2009, and December 31, 2018, while they were insured under the Collective Policy, and Clal Insurance did not give them a discount of at least 20% according to Clal Insurance's lowest prevailing rate at the time of purchase in respect of individual policies that are equivalent to the plan the policyholder had chosen, for a policyholder of comparable age and health condition, provided that it does not exceed the regulator-approved rate.	In January 2021, the court partially certified the motion to approve the class action. The lead plaintiff's motion to certify the lawsuit as a class action, including with respect to any group of policyholders who hold a private long term care policy in which the period of eligibility for compensation is not for the policyholder's entire life, was denied. The causes of action for which the claim was certified as a class action lawsuit are a breach of the provisions of the Collective Policy and unjust enrichment, and the claimed remedy is restitution of the amounts by which the class members were overcharged. The proceeding is currently being litigated on the merits. In May 2025, the parties submitted a settlement agreement approval motion, in which mechanisms were set for granting or completing a discount to the relevant past and present policyholders, at rates agreed between the parties. Furthermore, under the settlement agreement, it was agreed to pay a compensation to the representative plaintiff and legal fees to his attorneys.	In the claim, the plaintiff estimated the alleged damage to all class members at NIS 52 million for alleged damage caused until the date of filing the motion, and NIS 126 million for the damage expected to be caused to the class members in the next 10 years.

Date and		Key claims and causes				Claimed
6. court	Defendants	of action	Key remedies	Represented class	Status / further details	amount
11/2019	Clal	According to the plaintiff,	Remedy in the form of	According to the Court's	In June 2023, the Regional Labor Court decided to reject the claims that Clal Insurance	NIS 120
	Insurance	Clal Insurance charged	restitution of the	decision - anyone who	charged management fees out of the accrued savings in violation of the law or contrary	million
Regional		management fees in life	management fees the	was or is a policyholder	to the provisions of the policy, as well as the alternative claim that Clal Insurance
Labor Court		insurance policies with	class members were	of the respondent under	charged management fees out of the accrued savings at a rate that exceeded the rate
- Tel Aviv		an integrated profit	unlawfully charged, as	a Relevant Policy in the	permitted by law; however, the Court decided to partially certify the lawsuit as a class
		sharing savings	well as a mandatory	period beginning seven	action claiming that Clal Insurance collected management fees from policyholders
		component issued	injunction ordering Clal	years prior to the date of	insured under the relevant policies management fees out of premium contrary to the
		before January 12, 2004	Insurance to change its	filing the lawsuit and	provisions of the policy. It is noted that these policies have been marketed since 1999.
		(hereinafter - the	modus operandi with	ending on the day the	The causes of action for which the lawsuit was certified as a class action lawsuit are: a
		"Relevant Policies"), at	respect to the collection of	lawsuit was certified as a	breach of agreement, unjust enrichment, and a breach of statutory duty, including a
		rates that deviate from	management fees in the	class action lawsuit, and	breach of Clal Insurance's duties of trust and duties of care, and deception.
		the permissible limits,	Relevant Policies from	whom Clal Insurance	The parties are conducting a mediation procedures.
		without a legal and/or	here on out.	charged Management	In April 2024, the plaintiff appealed to the National Labor Court regarding the causes of
		contractual basis.		Fees exceeding the	action which were dismissed in the decision to certify the lawsuit as a class action, and
				permitted ceiling under	on the same day, Clal Insurance filed a motion for leave to appeal the decision to
				the relevant regulations	partially certify the lawsuit's adjudication as a class action; at the same time, the parties
				and/or in accordance	sought to stay the proceedings in the National Court to attempt to complete the
				with the provisions of the policy from a premium	mediation. In May 2025, the parties submitted a settlement agreement approval motion; the agreement focuses mainly on setting a mechanism for partial restitution of amounts
				contrary to the policy's	in respect of some of the allegations included in the lawsuit regarding the management
				provisions.	fees from the premium collected in the relevant policies during the period beginning 7
					years prior to the lawsuit's filing date, and provisions regarding a future discount in the
					management fees to be collected from the relevant policies, which are still active.
					Furthermore, the arrangement stipulated provisions regarding payment of
					compensation and legal fees to the plaintiff's attorney.

	Date and Key claims and causes
7.	court	Defendants	of action	Key remedies	Represented class	Status / further details	Claimed amount
	05/2022	Clal	The lawsuit concerns the	A judgment requiring Clal Insurance to	According to the court's decision -	In November 2024, the court decided to	The plaintiff estimated that
		Insurance	allegation that in policies that	include the cost of the implant and/or	all Clal Insurance policyholders	partially allow the motion, such that it	the aggregate damage
	District		cover surgeries in Israel that	accessory in the calculation of the	under the relevant policies, who	allowed the first cause of action and	caused to the class
	Court -		stipulate compensation for	benefits owed to the class members from	had a surgical procedure in a	dismissed the second cause of action.	members is over NIS 2.5
	Central		surgeries performed without	here on out, and compelling it to	private hospital and are eligible to	The cause of action for which the	million.
			financing from Clal Insurance, Clal	indemnify the class members for the	compensation out of the amount	lawsuit has been certified as a class
			Insurance refrains from	deductible amounts they paid in	Clal Insurance saved following the	action is breach of contract.
			compensating the policyholders	connection with the various surgeries	funding of the surgical procedure	In December 2024, the parties filed an
			for the cost of the implants and	and to calculate the compensation	by the health maintenance	update stating that they had resumed
			accessories used to perform the	accordingly, as well as requiring Clal	organization over a period starting	their dialogue in an attempt to minimize
			surgery (hereinafter - the "First	Insurance to compensate each member	3 years prior to the filing of the	their disputes.
			Cause"), and also refrains from	of the sub-category with respect to the	motion to certify and through the
			indemnifying the policyholders for	monetary remedies, at the rate of 50%	issuance of a judgment in the
			the deductible amounts they had	(or another rate) of the cost of the implant	lawsuit, where compensation was
			paid (hereinafter - the "Second	borne by Clal Insurance and/or the	calculated without including the
			Cause").	deductible amount paid by the class	implants component.
				member due to a surgery they had, with
				added linkage differences and interest,
				as per the law.

	Date and		Key claims and causes
8.	court	Defendants	of action	Key remedies	Represented class	Status / further details	Claimed amount
	5/2019	Clal Insurance	According to the plaintiff, the defendant systematically reduces	Restitution in kind of the funds the class members were unlawfully denied,	In accordance with the Regional Labor Court ruling – all current or	In November 2024, the Regional Labor Court partially certified the lawsuit as class	The plaintiff estimated the total alleged damage to all
	Regional		the permanent health insurance	according to the plaintiff, and with	former policyholders (holding	action, while allowing the claim regarding	class members at NIS 2.4
	Labor Court		benefits it pays its policyholders	respect to the premium release funds –	participating Clal Insurance life	the unlawful deduction of the calculative	billion.
	- Tel Aviv		under its participating permanent	crediting the policies' savings. The	insurance policies stipulating a	interest rate as from May 28, 2016; the
			health insurance policies, by	plaintiff also petitions to declare that	mechanism for linking permanent	court dismissed the claim regarding
			unlawfully deducting management	certain provisions of the policies, in	health insurance benefits to the	unlawful deduction of management fees
			fees and calculative interest.	relation to the interest and management	return on the investment portfolio,	from the insurance benefits.
				fees deduction from the yield to which	starting from the 25th payment) to	The causes of action in respect of which
				the policyholders are entitled, are void.	whom the respondent paid and/or	the lawsuit was certified as a class action
					pays permanent health insurance	are alleged breach of Section 3 to the
					benefits for a period exceeding 24	Insurance Contracts Law, alleged breach
					months, and for whom the	of the duty to draft the insurance contract
					respondent deducted and/or	in a clear manner and include therein all
					deducts the calculative interest	relevant provisions, and alleged breach of
					from the return, starting from the payment for the 25th month.	the duty to act in good faith and unjust enrichment.
						In January 2025, Clal Insurance brought a
						motion for leave to appeal before the
						National Labor Court, and the movant filed
						an appeal. The applicant responded to the
						motion for leave to appeal and the
						Company responded to the appeal. In April
						2025, the Company submitted a response
						to the motion for leave to appeal.

2.1.2 Pending motions to certify material claims as class actions against the Company and the consolidated companies, with the exception of the Max Group companies⁴

	Date and
1.	court		Defendants Key claims and causes of action	Key remedies	Represented class	Status / further details	Claimed amount
	9/2015	Clal	According to the plaintiffs, who are planholders in	To require the defendants to	Planholders of provident funds	In November 2022, the District	The plaintiffs estimated
		Pension	the pension funds managed by the defendants,	alter the agent compensation	managed by the plaintiffs, who	Court's rendered its judgment, in	the damage to all class
	District	and	the mechanism to remunerate agents and brokers	mechanism and to pay the	were charged management fees	which the motion to certify was	members at approx. NIS
	Court - Tel	Provident	with fees and commissions as a rate out of the	planholders back the	from which the agents' commission	denied.	2 billion, reflecting
	Aviv	Funds, as	management fees planholders are charged, as	excessive management fees	is derived based on the	In January 2023, the plaintiffs	approx. NIS 300 million in
		well as four	had been the custom among the defendants, is a	they were charged.	management fees amount.	appealed the judgment. The	annual damage since
		other	breach of the duty of loyalty toward the			proceeding is at the stage of	2008.
		companies	planholders in the provident funds the defendants			hearing the appeal.
		that	manage, and leads to the collection of higher
		manage	management fees than is appropriate by the
		pension	defendants.
		funds

	Date and		Key claims and causes			Status / further
2.	court	Defendants	of action	Key remedies	Represented class	details	Claimed amount
	2/2020	Clal	According to the	Issue orders against the defendants	The motion classifies the plaintiffs into several subcategories, mainly including:	The proceeding is	The plaintiffs
		Insurance	plaintiffs, due to "lack	and the Insurance Commissioner for	Any student in a school or kindergarten in the State of Israel who had been	at the stage of the	estimated the
	District	and	of knowledge"	the discovery of documents and data;	insured under a personal accidents insurance policy by the defendants and did	motion to certify	alleged damage
	Court -	another	following the failure to	order the extension of the prescription	not receive a copy of the personal accidents insurance policy at their home,	being reviewed.	against Clal
	Central	insurance	present the personal	period; order the appointment of a	starting from the school year that started in September 2006, and/or any student	In March 2025, a	Insurance at
		company	accidents insurance	committee that will include	whose cause of action against the insurance company has become invalid under	settlement	approx. NIS 1.4
			policy (hereinafter - the	independent members and will be	the statute of limitations;	agreement	billion, plus
			"Policy") to the	authorized to discuss and decide all	In addition, the motion defines additional subcategories, comprising students	approval motion	approx. NIS 1.5
			students, to the	personal claims under the Policy for	who were born after October 25, 1995, and who, between the ages of 3 and 19	was submitted,	billion in
			policyholders, and to	three years, in respect of all cases	(while in the Israeli education system, from kindergarten and until their graduation	which focused	damage
			their relatives, and the	before October 25, 2016 (hereinafter	from the 12th or 13th grade), suffered an accident that resulted in physical harm,	mainly on the	attributable to
			Policy's non	- the "Committee"), and will also be	and who were not paid insurance benefits in accordance with the Policy, divided	publication of ads	the two
			publication, the	authorized to discuss the issue of the	into sub-categories according to the type of harm, as detailed in the motion;	regarding the	defendants due
			policyholders have not	Policy's delivery; order a procedure	In addition, a subcategory comprising of people born in 1974 to 1995, whose	scope of the	to breach of
			been exercising their	for transferring the burden of	members are people and/or their parents and/or heirs who were born and/or	policy's coverage.	autonomy.
			right to benefits under	evidence; issue a mandatory	studied in Israel between 1974 and 1995 and who were injured or killed after
			the Policy, and they	injunction ordering the defendants to	1992, and did not file insurance claims because they did not know about the
			are incurring damages.	compensate the plaintiffs in	Policy and its scope; and the subcategory of all policyholders – all students and
				accordance with the Committee's	all their parents, from September 1992 to September 18, 2016, divided into sub
				ruling; award special damages to the	categories according to the causes of harm, as detailed in the lawsuit.
				plaintiffs and the counsels' legal fees.

	Date and		Key claims and causes

3.	court 3/2020 Regional Labor Court - Tel Aviv	Defendants Clal Insurance	of action According to the plaintiff, Clal Insurance systematically violates the provisions of the law by charging unlawful insurance premiums for "temporary risk" insurance (payment for insurance coverage when the regular deposits into a savings policy with combined insurance components are discontinued), by making excessive deductions out of the accrued savings amount and thus reducing the accrued savings, without informing the policyholders in advance of making the "temporary risk" insurance and of its terms and rates, and in breach of the duty to send the policyholders up-to-date insurance information sheets on time or at all.	Key remedies (1) Restitution of all funds charged out of the accrual and/or otherwise in respect of the entire period following the termination of employment (except when the policyholder has asked to purchase the insurance coverages in writing). Alternatively, restitution of all funds collected for the period after 3 or 5 months from the termination of their employment, in accordance with the relevant statutory arrangement (hereinafter - the "Automatic Temporary Risk Period"), and in cases of higher insurance premiums, restitution of the excess insurance premiums in respect of the Automatic Temporary Risk Period as well; (2) a prohibition on making "temporary risk" insurances for a period exceeding the Automatic Temporary Risk Period, except when the policyholders request this it in writing; (3) compelling Clal Insurance to return the excess insurance premiums paid by policyholders who were charged double insurance premiums (for the month they returned to work); (4) various provisions relating to future conduct (including a prohibition on increasing premiums, giving prior notice of the purchase of a temporary risk, and more).	Represented class The represented class for the purpose of the non pecuniary remedies is all policyholders under provident funds or insurance plans within which employers and/or employees make contributions for permanent health insurance and/or insurance in case of death, or any other insurance risk. The represented class for the purpose of the pecuniary remedies is: (a) all the policyholders for whom funds were collected for permanent health insurance or insurance in case of death or any other insured event, out of the accrual funds or any other source, without prior notice; (b) alternatively, policyholders who were charged insurance premiums for periods that exceed the Automatic Temporary Risk Period, unless they agreed in advance; (c) policyholders who were charged higher insurance premiums than the insurance premiums they were charged when they were active policyholders and/or who were charged for new insurance policies that they did not have prior to the termination of their work; (d) policyholders who were charged double insurance premiums. According to the plaintiff, the lawsuit ought not to be subject to any prescription. Alternatively, the claim for pecuniary remedies is made for the period starting 7 years before the lawsuit was filed, i.e., 2020, and until the lawsuit is certified as a class action.	Status / further details The proceeding is at the stage of the motion to certify being reviewed. Pursuant to the court's ruling, the Commissioner of the Capital Market, Insurance and Savings Authority (hereinafter - the "Commissioner") submitted his position, clarifying that collecting insurance premiums is permissible only in accordance with the provisions of the law and the applicable policy. In March 2025, a settlement agreement approval motion submitted; the agreement sets mechanisms for partial restitution of amounts in respect of some of the allegations included in the lawsuit regarding the duration of the collection of premiums for insurance coverage during the Temporary Risk Period and/or the rate of the insurance premium collected during the Temporary Risk Period. Furthermore, a mechanism was set for notifying policyholders who will enter the Automatic Temporary Risk Period, of the terms of the coverage in accordance with the terms detailed in the agreement. In addition, a mechanism was set for clarifying facts and reaching a decision through an expert regarding another allegation made in the statement of claim (pertaining to policyholders who were charged double insurance premiums); it was also agreed on payment of compensation and legal fees to the movant and their attorney.	Claimed amount The class action claimed amount was estimated conservatively, according to the plaintiff, at no less than NIS 7 million per year.
	Date and
4.	court			Defendants Key claims and causes of action Key remedies	Represented class	Status / further details Claimed amount
	4/2020	Clal	According to the plaintiffs, the	Compensate the class members, repair	Any policyholder of one or more of the	The proceeding is at the stage of	The plaintiffs estimated the
		Insurance	respondents must be compelled	all the harm they suffered, issue a	respondents, under a compulsory	the motion to certify being	alleged damage against Clal
	District	and 12	to compensate the	class mandatory injunction ordering the	motor insurance and/or comprehensive motor insurance	reviewed.	Insurance in respect of the period
	Court - Haifa	additional insurance companies	members and fully remedy the harm they incurred due to the excess premiums they have been	adjustment of the collected amounts to the risk the respondents are actually exposed to during the effective period,	In February 2021, the court ordered the consolidation of the motion to certify this class action	from March 8, 2020, until April 30, 2020, at NIS 103 million, and jointly for all the respondents
paying for motor insurance, due to and/or render a declaratory judgment on March 8, 2020, and ending on the					lawsuit, with respect to	(except one), at approx. NIS 1.2

date of full and final removal of movement restrictions imposed on residents of Israel due to the compulsory motor and property insurance policies, with a motion to certify a separate class action lawsuit that concerns similar causes, in which Clal Insurance has not been named as a respondent (hereinafter - the "Separate Motion") which was billion. Alternatively, for 8 of the defendant companies (that do not include Clal Insurance), it was claimed that the damage is approx. NIS 720,000 thousand. The movants note that the damage accrued further as the collection did not cease.

filed in April 2021.

coronavirus, or part of it.

stating that a material reduction in the use of vehicles, as had occurred, for example, during the effective period, calls for an adjustment (reduction) to the

premium.

the dramatically reduced use of vehicles during the Covid-19 pandemic and the significantly

reduced risk level.

	Date and		Key claims and causes
5.	court	Defendants	of action	Key remedies	Represented class	Status / further details	Claimed amount
	7/2020 District Court - Central	Clal Insurance and 4 additional insurance companies	According to the plaintiffs, the defendants allegedly do not reduce the insurance premiums for policyholders for whom pre-existing condition exclusions were stipulated, even though the exclusions are claimed to lower the insurance risk, relative to the risk in insurance policies held by policyholders for whom no such exclusions were stipulated.	Compensation/refund of all the amounts the policyholders in the class were overcharged by, with linkage differentials and interest as per the law, as well as a mandatory injunction ordering the defendants to change their modus operandi.	Anyone who was a policyholder during the period beginning 7 years before the day of filing the claim and ending on the day of its certification as a class action, by one or more of the defendants, under an insurance policy for disability, long-term care, life, permanent health, personal accidents, health (including critical illness, surgeries in Israel or abroad, transplants in Israel or abroad, medications, ambulatory procedures or any other medical coverage) that contains an exclusion. For this purpose, an "exclusion" – a policy clause which stipulates that any event / injury / disease, or any risk that materializes and that stems from and/or is related to a pre existing condition the policyholder had on the day the policy was obtained, are not covered under the policy.	The proceeding is at the stage of the motion to certify being reviewed.	The plaintiffs estimated that the total damage to all class members with respect to all the defendants totals NIS 1.9 billion, and they note that each defendants' share is in accordance with its market share of the Health and Life Insurance Subsegment, according to the Capital Market Commissioner's publications.
6.	Date and court 9/2020 District Court - Central	Clal Insurance and another insurance company	Defendants Key claims and causes of action The lawsuit concerns the allegation that the defendants acted contrary to the provisions of critical illness policies, and specifically – that they did not act in accordance with the terms of the policy that stipulate that after a first insured event has occurred, if the policyholder is still covered under the insurance policy, the insurance amount and the monthly premium amount will be reduced by 50%.	Key remedies The relief the plaintiffs are petitioning for is damages to the class members due to past damages, as well as a declaratory relief and a mandatory injunction ordering the defendants to change their modus operandi.	Represented class All of the respondents' clients / policyholders who were covered under critical illness insurance and/or critical illness and serious medical events insurance and/or any other similar insurance by any other name, who experienced their first insured event, after which they were charged a higher premium than the agreed premium in breach of the terms of the insurance policy, in the 7 years before the motion was brought.	Status / further details In April 2024, a settlement agreement was submitted to the court for approval; under that agreement, Clal Insurance must return a certain percentage of the insurance premiums to the class members, in accordance with the mechanism set forth in the settlement agreement, as well as notify the policyholders in the policies that the lawsuit concerns of the applicable insurance premiums and insurance benefits mechanism with respect to the future. In March 2025, the State submitted to the Court an objection to the settlement agreement and Clal Insurance submitted its response to the	Claimed amount The plaintiffs estimated that the total damage to all class members with respect to Clal Insurance totals NIS 16.8 million.
						State's position. The arrangement is subject to the court's approval.

	Date and
7.	court		Defendants Key claims and causes of action	Key remedies	Represented class	Status / further details	Claimed amount
	4/2021	Clal	The lawsuit concerns the claim that	The main remedies the plaintiffs	All the defendants' customers who used the digital	The proceeding is at the	The plaintiffs estimated the
		Insurance	the defendants are violating the	are petitioning for are: to instruct	services on the websites and apps operated by the	stage of the motion to	damage to all class
	District	and 14	provisions of the law by transferring	the defendants to cease	defendants in the seven years before the lawsuit was	certify being reviewed.	members in millions of
	Court - Tel	additional	their customers' personal and	transferring information about their	filed, and about whom private and/or personal and/or		shekels, in the aggregate.
	Aviv-Jaffa	companies	confidential information, without the	customers to third parties, to act in	confidential information was transferred to a third
			customers' consent, to third parties	accordance with the law and guard	party.
			(in particular, to Google and its	and protect the customers' privacy,
			advertising service), thus infringing	to disclose all the documents in
			on the customers' right to privacy and	their possession and that may aid
			violating their lawful obligations.	in the investigation into the truthful,
				and to compensate the plaintiffs for
				the pecuniary and non-pecuniary
				damages they incurred.

	Date and
8.	court		Defendants Key claims and causes of action	Key remedies	Represented class	Status / further details	Claimed amount
	7/2021	Clal	The lawsuit concerns the allegation	The main remedies claimed in the	The defendants' policyholders who purchased from	The proceeding is at the	The plaintiffs estimated the
		Insurance	that when receiving an annuity from	lawsuit are a declaratory order	them a life insurance policy that includes accrued	stage of the motion to	aggregate damage to all
	District	and 6	a profit-participating policy issued	according to which the interest	savings and investment income participation, issued	certify being reviewed.	class members in an
	Court - Tel	additional	between 1991 and 2004, the	deduction from the monthly return	between 1991 and 2004, and from which interest was	The parties are	amount greatly exceeding
	Aviv-Jaffa	companies	defendants deduct annual interest at a rate of 2.5 (or any other rate) out of	is a breach of the policies, and alternatively – a declaratory relief	and/or will be deducted at a rate not specified in the policy, based on the provision in the policy, according	conducting a mediation procedure to conclude the	NIS 2.5 million.
			the monthly return accrued due to the	according to which this is a	to which the amount of the monthly pension will	proceeding.
			lower cash surrender value,	depriving condition in a standard	change "each month according to the results of the
			unlawfully and without any	contract and a motion to order its	investments net of the interest according to which the
			contractual basis under the terms of	nullity, and to order a refund of the	amount of the monthly pension was calculated, and
			the policy.	amounts deducted from the class	the appropriate provisions for this matter in the
				members' monthly annuity, plus	insurance plan" and/or any other similar provision.
				linkage differentials and interest,
				starting seven years prior to the
				date of filing the lawsuit and until
				the final ruling on it is rendered, and
				to order the defendants to cease
				deducting interest out of the
				monthly return.

Date and

Claimed amount	Status / further details	Represented class	Key remedies	Defendants Key claims and causes of action		court
The plaintiffs estimated the	The proceeding is at the	All of the defendants' policyholders aged 21 and under	The main remedies claimed in the	The lawsuit concerns the allegation	Clal	10/2021
total alleged damage to the	stage of the motion to	(or their heirs), who have special needs and who are	lawsuit are full compensation to	that the defendants unlawfully deny	Insurance
class members against the	certify being reviewed.	insured under a long-term care insurance policy sold	the class for all the harms they	insurance claims by children with	and	District
two defendants, jointly, at		by any of the defendants and who suffer from "mental	were caused and compelling the	special needs in the framework of a	additional	Court - Lod
approx. NIS 2.97 billion.		frailty," who were not recognized by the defendants as	defendants to comply with the	long-term care insurance policy, even	company
		being "mentally frail" and whose rights under the	insurance agreements.	though, according to the plaintiffs,




				condition falls within this definition.
		policy were denied, with respect to the past period and the future.		they meet the definition of an insured event by virtue of "mental frailty" according to the terms of the policy, without checking whether their

	Date and
10.	court		Defendants Key claims and causes of action	Key remedies	Represented class	Status / further details	Claimed amount
	07/2022	Clal	The lawsuit concerns the allegation that	The main claimed remedies are a	The First Class the movant seeks to represent is	The proceeding is at the	The plaintiff estimated
		Insurance	Clal Insurance denies policyholders'	declaration that in Clal Insurance's	any person who entered into a health insurance	stage of the motion to	that the aggregate
	District		insurance claims in private health	health insurance policies that define a	contract with Clal, which includes insurance	certify being reviewed. In	damage caused to the
	Court - Tel		insurance policies it had marketed until	"surgery" as an "insured event," any	coverage for "surgery," and whose claim due to a	November 2024, the	class members is over
	Aviv-Jaffa		February 2016, which include a basic	medically necessary surgery is included,	surgery was denied and/or will be denied on the	parties agreed to refer the	NIS 2.5 million.
			insurance tier, on the grounds of the	including a preventive surgery that is	grounds that it is a "preventive surgery" that is not	proceeding to mediation.
			claim being filed due to "preventive	intended to prevent a disease, defect, or	covered by the policy, until a final and irreversible
			surgery" that does not meet the definition	deformity in the policyholder and/or the	ruling is made in the class action lawsuit.
			of the term "surgery" in the policy	harmful effect of the above; a declaration	The Second Class the movant wishes to
			(hereinafter - the "Basic Tier Policies");	that denying policyholders' insurance	represent is all former or current Clal
			as well as the allegation that Clal Insurance had marketed (for increased	claims for coverage in respect of a preventive surgery under a Basic Tier	policyholders who purchased private health insurance policies that expand the insurance
			premiums) policies that supposedly offer	Health Insurance Policy violates the	coverage to include preventive surgery from Clal
			wider coverage than the Basic Tier	insurance contract; and an order that	Insurance and/or from anyone on its behalf until
			Policies and that include coverage for	requires Clal Insurance to contact the	February 1, 2016, and for which they paid
			preventive surgeries, while this	policyholders under all Basic Tier	excessive premiums from the date the extended
			component is already covered by the	Policies, and inform them that preventive	policies were marketed and until the collection
			Basic Tier Policies.	surgeries are covered under the	stops and/or until a final and irreversible ruling is
				insurance coverage in the policy.	made on the class action lawsuit.

	Date and
11.	court		Defendants Key claims and causes of action	Key remedies	Represented class	Status / further details	Claimed amount
	10/2022	Clal	The lawsuit concerns the allegation that	The main remedies sought in the	The class the plaintiffs seek to represent is all of the	The proceeding is at the	The plaintiffs
		Insurance	Clal Insurance's modus operandi is	lawsuit are, inter alia, to issue a	respondent's customers, whose home insurance policy	stage of the motion to certify	estimated that the
	District		automatic renewal of home insurance	declaratory order according to	the respondent had extended without their consent,	being reviewed.	aggregate damage
	Court - Lod		policies while raising the insurance	which Clal Insurance acted	and/or all of the respondent's customers who were		caused to the class
			premiums from year to year, without	unlawfully, to order Clal to refrain	charged insurance premiums for a home insurance		members exceeds
			obtaining the policyholder's consent.	from automatic policy renewals and/or policy renewals at less	policy without their consent (including Clal Insurance's customers whose insurance premiums were raised		NIS 3 million.
				favorable conditions, and to	without their consent when the policy was renewed), in
				compensate the class members for	the period starting 7 years before the claim was filed
				the damage they incurred, with	and to date.
				interest and linkage.

	Date and
12.	court		Defendants Key claims and causes of action	Key remedies	Represented class	Status / further details	Claimed amount
	11/2022	Clal	The lawsuit mainly concerns the	The main remedies	The represented class is all planholders (past and	The proceeding is at the stage	As a conservative
		Pension	allegation that Clal Pension and	sought within the lawsuit	present) whose pension fund, which is managed by Clal	of the motion to certify being	estimate, the class
	Regional	and	Provident Funds unlawfully charges	are a refund of the	Pension and Provident Funds, became subject to an	reviewed.	action claimed amount
	Labor Court	Provident	insurance premiums due to insurance	insurance premiums paid	insurance grace period arrangement without them being	In February 2024, the	was estimated by the
	- Tel Aviv	Funds	grace periods (a payment for insurance	by the class members	notified in advance, and thereby denying their right to	Commissioner's position was	plaintiff at no less than
			coverage when regular contributions to	during the insurance	choose not to allow the said arrangement to take effect.	submitted, which states, inter	NIS 2.5 million per year
			the pension fund are suspended) by	grace periods, and	With respect to monetary remedies, the represented class	alia, that the extension of the	and at approx. NIS 17.5
			making deductions out of the accrual,	compelling Clal Pension	is all planholders who did not continue to make	insurance is activated	million in total for the
			thereby reducing the accrual, without	and Provident Funds to	contributions to their pension funds after the insurance	automatically upon the	seven years preceding
			informing the planholders in advance	notify planholders of the	grace period had ended and did not seek to extend the	cessation of contributions to the	the date of filing the
			and allowing them to exercise their right	insurance grace period's	insurance arrangement, as well as all the planholders who	fund and that the management	motion to certify.
			to waive the coverage, as well as that it	commencement, the	opened an additional pension fund and paid double	company must notify the
			refuses to return the insurance	insurance premium rates,	insurance premiums, in the seven years prior to	planholder of the cessation of
			premiums when it learns that the	and the options available	submitting the motion to certify and until a judgment is	the planholder's deposits.
			planholder was insured by another	to them, in advance.	rendered in the lawsuit.
			pension fund.

	Date and
13.	court		Defendants Key claims and causes of action	Key remedies	Represented class	Status / further details	Claimed amount
	01/2023	Clal	The lawsuit concerns the allegation that Clal	The main remedies sought in the	The represented class is: with respect to the	The proceeding is at the stage	The plaintiff estimated
		Insurance	Insurance unlawfully reduced the insurance	lawsuit are a declaratory relief that	future arrangement – all Clal Insurance	of the motion to certify being	the aggregate damage
	Regional		benefits to which policyholders suffering	prohibits Clal Insurance from	policyholders who have permanent health	reviewed.	to all class members at
	Labor Court		from a permanent health are entitled, without	reducing the insurance benefits for	insurance and for whom, according to Clal	In December 2024, the parties	NIS 18 million in the 3

	Insurance unlawfully reduced the insurance	lawsuit are a declaratory relief that	future arrangement – all Clal Insurance	of the motion to certify being	the aggregate damage
Regional	benefits to which policyholders suffering	prohibits Clal Insurance from	policyholders who have permanent health	reviewed.	to all class members at
Labor Court	from a permanent health are entitled, without	reducing the insurance benefits for	insurance and for whom, according to Clal	In December 2024, the parties	NIS 18 million in the 3
- Tel Aviv	obtaining the policyholders' explicit prior	permanent health without obtaining	Insurance, the insurance coverage rate is	filed a motion for approval of a	years preceding the
	consent and in breach of the provisions of	the policyholder's explicit written	reduced or will be reduced in the future due	settlement agreement, whose	lawsuit filing date.
	the policy and the Capital Market Authority's	consent, and a monetary remedy	to an increase in the premium as they grow	main terms stipulate the
	instructions, as well as in breach of the duty	that requires Clal Insurance to pay	old; and with respect to the monetary	issuance of a notice to class
	of disclosure, while committing deception	the class members who suffered a	remedies – all past and present class	members, informing them that
	and without sending the policyholders any	permanent health event the	members who had an insured event, and	the scope of coverage in
	notice or alert of the need to pay an	difference to make up the	their insurance benefits were reduced by	permanent health insurance
	additional premium or reduce the insurance	insurance benefits amount.	Clal Insurance without the policyholder's	would be diminished due to the
	coverage. It was also argued that the		explicit, active, and prior consent.	inadequacy of the premium
	monthly benefits paid to policyholders who			payments to secure the
	have insurance coverage for permanent			monthly compensation rate.
	health were reduced or will be reduced in the			The settlement agreement is
	future, due to the premium increase as the			subject to the court's approval,
	policyholders grow older.			which will not necessarily be
				granted.

	Date and
14.	court		Defendants Key claims and causes of action	Key remedies	Represented class	Status / further detailsClaimed amount
	03/2023	Clal	The lawsuit concerns the allegation that Clal	The main remedies sought in the lawsuit are	The represented class is any injured party,	The proceeding is at	The plaintiff estimated
		Insurance	Insurance has an improper and illegal	a monetary remedy according to the gap	policyholder, or third party, who is entitled to	the stage of the	that the aggregate
	District		practice whereby it partially repays the	between the fees the class members paid	be reimbursed by Clal Insurance for	motion to certify	damage the class
	Court - Tel		appraiser's fees to the injured parties,	the appraisers and the payment made to the	appraiser's fees the injured party paid to an	being reviewed.	members incurred
	Aviv		without justification, and without explaining	class members as insurance benefits for this	appraiser in order to assess the damage to		exceeds NIS 2.5
			why the fees were reduced.	component (hereinafter - the "Pecuniary	the injured party's vehicle, if Clal Insurance		million.
				Damage"), as well as damages for non	did not transfer the full amount the injured
				pecuniary damage in the amount of 20% of	party paid for the appraiser's fees to the
				the pecuniary damage to all class members.	injured party.

	Date and
15.	court		Defendants Key claims and causes of action	Key remedies	Represented class		Status / further detailsClaimed amount
	03/2023	Clal Insurance	The lawsuit concerns the allegation that the defendants refuse to finance the	The main remedies sought in the lawsuit are, inter alia, a declaratory remedy stating that Clal Insurance must	The class that the plaintiffs seek to represent is any policyholder	The proceeding is at the stage of the	The plaintiffs estimated the total claimed amount
	District		policyholders' medical cannabis purchase	reimburse the policyholders for their medical cannabis	of Clal Insurance under the	motion to certify being	for all class members at
	Court - Tel		expenses, which, according to the	purchase expenses; to order Clal Insurance to contact all	Policies and who did not receive	reviewed.5	approx. NIS 13.5 million.
	reimbursement for their medical
	Aviv-Jaffa		plaintiffs, is contrary to the provisions of policies that offer coverage for	their eligible policyholders in recent years and actively invite them to demand the indemnification they deserve; and	cannabis purchase expenses.
			pharmaceuticals that are not included in	also, to require Clal Insurance to reimburse all class
			the Healthcare Services Basket, and the	members for the economic damage they suffered due to
			fact that medical cannabis has recognized	their improper conduct and due to a breach of the insurance
			medical uses in Western countries.	contract.

	Date and
16.	court		Defendants Key claims and causes of action Key remedies		Represented class	Status / further details	Claimed amount
	05/2023	Clal	The lawsuit concerns the allegation	The main remedies sought in the lawsuit are	The represented class includes	The proceeding is at the stage	According to the plaintiff,
		Pension	that when receiving a planholder's	to pay the class members the additional	policyholders in "Clal Pension" and "Clal	of the motion to certify being	the class action lawsuit
	Tel Aviv	and	request for a disability annuity, the	long-term care disability annuity;	Supplementary Pension" funds who	reviewed.	amount cannot be
	Jaffa	Provident	pension fund does not check	compensation and/or restitution for not	have disability insurance coverage,	An amended motion for class	estimated; however, for
	Regional	Funds	whether the planholder requires	making full contributions to the fund and for	who are insured with a pension fund	certification was submitted in	the purposes of the fee, it
	Labor		long-term care and/or if the	yield losses class members incurred as a	and are entitled to a disability annuity,	November 2024, in which	was put at no less than
	Court		planholder's condition has	result of the above non-payment; obligating	and who, due to their medical condition	similar allegations were made	NIS 2.5 million per year
			deteriorated in a way that made the	the fund to give the fund's physicians	on top of their permanent health,	to the allegations in the original	and approx. NIS 18.75
			planholder require long-term care,	accurate instructions in connection with	require long-term care, and the pension	motion to certify. In May 2025,	million in total for the
			and as a result, the fund does not	examining conditions that require long-term	fund did not supplement monthly	the regulator's position	seven years preceding the
			pay eligible planholders the	care when reviewing requests for a disability	payments for policyholders who, in	regarding the case was	date of filing the motion to
			additional long-term disability annuity.		addition to having a disability pension is	submitted.	certify.
			annuity.		a patient requiring long-term care.

^5. In July 2022 and in September 2022, motions to certify the claims as class actions against Clal Insurance, concerning similar claims and causes of action (hereinafter - the "Earlier Proceedings") were submitted to the District Court in Tel Aviv-Jaffa. In January 2023, the court ruled in favor of consolidating the Earlier Proceedings, and accordingly, the proceeding was filed in March 2023.

	Date and
17.	court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / further details	Claimed amount
	05/2023	Clal Holdings	The lawsuit concerns the allegation of	Compensation for	The class the movant seeks to	This lawsuit was filed further to a	The plaintiff estimated
	District Court (Economic Department) - Tel Aviv	Clal Insurance Clal Pension and Provident Funds Clal Israel Stock Basket "Atudot" - Pension Fund for Workers and Independent Workers Ltd. (a subsidiary of Clal Insurance (held at 50%) (hereinafter - "Atudot") Company officers and investment committee members	damage supposedly caused to planholders in provident funds, pension funds, life insurance, and savings policies managed by the Group companies, in light of the respondents' ruling to sell the Alrov Properties & Lodgings Ltd. (hereinafter - "Alrov") shares held by the Group companies, within the investment of the policyholders' and planholders' funds, to the Israel-Canada Company (T.R.) Ltd. (hereinafter - "Israel Canada"), due to a dispute between some of the respondents and Alrov's controlling shareholder, and despite the fact that at the time of signing the agreement, the Group companies allegedly had an offer from Mr. Alfred Akirov to purchase the Alrov shares at a price of at least 33% higher than the price Israel Canada paid for Alrov shares.	pecuniary damage, which the plaintiff claims reflects the damage caused to the class members.	represent is anyone who has been a planholder of the provident funds, pension funds, life insurance, and savings policies managed by the Group companies that held shares in Alrov on March 18, 2021.	class action lawsuit filed in December 2021 to the Regional Labor Court, and was stricken out by the Court in May 2023, due to a lack of substantive jurisdiction. In July 2024, the Court allowed the respondents' request and ordered the dismissal in limine of the motion to certify against the Company and against the officers and members of the Investment Committee, who were added as respondents to the proceeding, such that the proceeding will continue to be heard only against the other respondents. The proceeding is at the stage of the motion to certify being reviewed.	the aggregate damage to all class members at approx. NIS 128 million.

Date and

18. court		Defendants Key claims and causes of action	Key remedies	Represented class	Status / further details	Claimed amount
06/2023	Clal The lawsuit concerns the allegation that following the		The remedy the plaintiff is petitioning for	The class the plaintiff seeks to	The proceeding is at the	The plaintiff
	Insurance	economy-wide extension order regarding the increase	is to close the Contribution Policies and	represent is anyone for whom Clal	stage of the motion to	conservatively
Regional		in pension insurance contributions in 2016	transfer the contributions made thereto,	Insurance had managed an	certify being reviewed.	estimated the
Court -		(hereinafter - the "Extension Order"), which concerns	as well as future contributions	executive insurance policy issued	In June 2024, the Court	aggregate damage to
Haifa		an increase in the pension insurance contributions	originating from the Increased	before May 31, 2001, and for	ordered to ask for the	all class members in
		employers are required to make for their employees	Contributions, to the Old Policies, or,	whom, after June 30, 2016, it	regulator's position in	millions of shekels.
		(hereinafter - the "Increased Contributions"), Clal	alternatively, to set beneficial factors for	managed (in a new insurance	connection with this
		Insurance opened new executive insurance policies	the Contribution Policies, at the	policy) the funds received due to	proceeding.
		(hereinafter - the "Contribution Policies") for its	discretion of the court; to pay the people	them for the Increased
		policyholders who had had old executive insurance	who are already being paid a pension	Contributions, or the beneficiaries
		policies that had been issued before May 31, 2001	out of the Contribution Policies the	or heirs of any such person.
	(hereinafter - the "Old Policies"), while the annuity conversion factors set for the Contribution Policies		difference between the amounts they
			would have received if the Increased
	were not guaranteed and were less beneficial than the		Contributions funds had all been
	guaranteed annuity conversion factors in the Old		deposited into the Old Policies (or the
		Policies, and redirected the additional funds from the	amounts they would receive due to
		Increased Contributions into the Contribution Policies,	beneficial factors, at the discretion of the
without the policyholders' consent.		court) and the amounts they actually
			received; to compel Clal Insurance to
	pay each of the class members NIS 500
	in damages for non-pecuniary damage
			due to deception.

	Date and
19.	court		Defendants Key claims and causes of action Key remedies		Represented class	Status / further details	Claimed amount
	06/2023	Clal	The lawsuit concerns the allegation	Repayment of the funds	The class the plaintiff seeks to represent	The proceeding is at the stage of the motion to	The plaintiff
		Insurance	that the defendants ought to have	deducted as tax out of the	is any individual who is paid an annuity	certify being reviewed.	estimated the
	District		refrained from deducting tax out of	"recognized annuity" portion of	from one of the new pension funds	At the same time as submitting the answer to the	aggregate damage to
	Court - Tel	Clal	the portion of the annuity equal to	the annuity to the class	and/or the provident funds and/or the	motion to certify the claim as a class action, the	all class members at
	Aviv-Jaffa	Pension	the annuity recipients' "recognized	members.	insurance funds managed by any of the	respondents submitted a motion for permission to	approx. NIS 297
		and	annuity" in the pension products		respondents, who was entitled to a tax	send a third party notice to the Israel Tax	million, for all class
		Provident	they manage, and apply a tax		exemption on their annuity in respect of	Authority.	members who are
		Funds and	exemption due to that component,		their "recognized annuity" component,	In its response to the third party notice, the Israel	paid annuities from
		4 additional	which would have resulted in		as this term is defined in the Income Tax	Tax Authority rejected the arguments made	the defendants,
		companies	higher annuity payments to the		Ordinance, and did not receive the	therein and argued, among other things, that it	without attributing a
			class members.		above exemption, as of January 1,	should be added as a respondent to the	specific monetary
					2012, and thereafter.	proceeding rather than as a third party.	remedy to each
							defendant.

Date and

20. court		Defendants Key claims and causes of action	Key remedies	Represented class	Status / further details	Claimed amount
08/2023	Clal	The claim concerns the contention that in insurance	Provision of a mandatory injunction	All Clal Insurance policyholders	The proceeding is at the	The plaintiff estimated
	Insurance	policies marketed by Clal Insurance, in a plan of the	pursuant to which Clal Insurance is	with health-insurance policies	stage of the motion to	that the aggregate
District		type "self-defense" and/or any other marketing name,	required to update the insurance	within the "self-defense" plan,	certify being reviewed.	damage the class
Court		Clal Insurance was asked in the insurance registration	policies with insurance coverage of the	and/or any other marketing name,		members incurred
		form (the insurance offer) to insure its policyholders	type perpetual disability due to accident,	issued by Clal Insurance with		exceeds NIS 2.5
Center -		under an insurance plan that includes several forms	required to provide the class members	insurance coverage of the type		million.
Lod		of insurance coverage, including insurance coverage	with insurance coverage in respect of	"loss/impairment of functioning" in
		for perpetual disability due to accident, yet in practice	perpetual disability due to accident, and	contradiction of the statements in
		it issued policyholders different and disability	charged with special interest.	the insurance offer form, which
		insurance coverage of the type "loss/impairment of		noted insurance coverage of the
		functioning".		type "accidental disability," as well
				as Clal Insurance policyholders
				with this policy who were denied
				their entitlement to receive
				insurance benefits for perpetual
				disability due to an accident event
				based on the argument that no
				such coverage exists in the policy.

	Date and
21.	court		Defendants Key claims and causes of action	Key remedies	Represented class	Status / further details	Claimed amount
	09/2023 District Court - Tel Aviv	Clal Insurance and 7 additional insurance companies	The claim concerns the contention that the defendants do not pay for insurance incidents and do not provide towing services to policyholders who purchase a towing rider in cases in which it is necessary to tow the insured vehicle using a towing lift, and that they charge these vehicle owners added payment, despite the fact that this matter is not expressed in the language of the riders.	The remedies sought are, among other matters, compensation in respect of reimbursement of premium payments, towing costs, and non-pecuniary damages ("pain and suffering") in the amount of NIS 3,000 per class member, and in addition, amendment of the language of the riders issued on behalf of the respondents.	The class in the name of which the claim is filed is defined as the "the class of consumers who hold or held riders of respondents 1-8 in the last 7 years prior to the filing of the claim and in the period after the filing of this claim, until a judgment is rendered, whose vehicle necessitates the possibility or requires towing via lift when the vehicle is inoperable (requiring towing to a garage).	In November 2023, the court ordered a severance of proceedings by way of filing separate motions for certification, while ordering that most of the respondents be stricken out, including Clal Insurance. In January 2025, the movants appealed against the court's above	The plaintiff estimated the aggregate damage to all class members at approx. NIS 80 million.
						ruling to the Supreme Court.

	Date and
22.	court		Defendants Key claims and causes of action	Key remedies	Represented class	Status / further details	Claimed amount
	11/2023	Clal	The lawsuit concerns the claim that when	The remedies sought are	The petitioners define five classes in the claim. (1)	The proceeding is at the	The plaintiff estimated
		Insurance	setting the price of premiums in life, health,	declaratory relief, a mandatory	Policyholders some of whose policies contain a war	stage of the motion to	that the aggregate
	District	and 7	and P&C insurance policies, "catastrophe	injunction, reimbursement or	exclusion that excludes insurance coverage of an	certify being reviewed.	damage the class
	Court - Tel	additional	events" such as a "surprise" war and/or other	reduction of the premiums	insured event in wartime, but, in light of their call-up		members incurred
	Aviv	insurance	extreme or unexpected events that reduced	from the date of declaration of	for reserve military service, the actuarial risk in		exceeds NIS 2.5
		companies	the defendants' risk and exposure were not	a state of emergency, and	connection with whom has decreased, and		million. With regard to
			factored in; that in light of the Iron Swords	pecuniary and non-pecuniary	accordingly, action should be taken to reimburse		policyholders called
			War, the defendants are expected to	monetary compensation.	and/or reduce the premium; (2) policyholders of the		up for reserve duty, it
			experience a major reduction in the risk in		respondents, mainly in the area of P&C insurance,		is argued that the
			policies in which the risk-weighted		who, due to the declaration of a state of emergency		estimated damage is
			components had significantly decreased		and the transition of government institutions, public		in the amount of NIS
			(and completely eliminated in some cases).		entities, and dual-purpose entities to an emergency		10.02 million (with
					work format, will be unable, or able in a partial and limited manner, to exercise the insurance service		respect to all of the defendants).
					and/or coverage; (3) policyholders of the respondents
					who, due to the declaration of a state of emergency
					and the transition of government institutions, public
					entities, and dual-purpose entities to an emergency
					work format, cannot receive services such as
					treatment and elective surgeries at public hospitals.
					(4) Policyholders in P&C insurance – property policies
					of the various types, vehicle, home - which, due to the
					state of emergency, their inherent risk decreased
					substantially; (5) policyholders of various policies in
					the area of business, the risk of which has significantly
					decreased due to the state of emergency.

	Date and
23.	court		Defendants Key claims and causes of action	Key remedies	Represented class	Status / further details	Claimed amount
	12/2023	Clal	The action involves the claim that the defendant unlawfully	Restitution of insurance	The class the plaintiff seeks to represent is	The proceeding is at the	The class action
		Pension	collects insurance premiums in the comprehensive pension	premiums that were	everyone who, during the 7 years that ended	stage of the motion to	claimed amount was
	Regional	and	fund under its management that are higher than those it was	collected from the class	on the day the motion was submitted, was a	certify being reviewed.	estimated
	Labor Court -	Provident	entitled to collect, while reducing the amount of the accrual	members plus interest	planholder of the comprehensive pension	The parties have notified	conservatively,
	Haifa	Funds	of the fund's planholders: (a) when receiving retroactive	and linkage differentials;	fund of "Clal Pension," and from whom the	the Court that they are	according to the
			contributions - insurance premiums are collected that are	A declaration on the	respondent collected an insurance premium	conducting a mediation	plaintiff, at millions of
			higher than the insurance premiums that the defendant was	nullity of provisions in the	calculated on the basis of an amount greater	proceeding.	shekels, without
			supposed to collect; (b) as a result of attributing "insured	regulations that were in	than the maximum amount for this matter,		specifying an amount.
			income" that is higher than the planholder's salary when the	effect in the relevant	according to the law and/or according to the
			rate of contribution for rewards was more than 11.5% of the	years and a prohibition	fund's regulations that were in effect on the
			planholder's salary and less than 13%; (c) as a result of	on the management	collection day, the lower of the two.
			collecting insurance premiums due to the portion of the	company to carry out the
			planholder's income that exceeds the monthly contribution	actions mentioned in
			ceiling for the pension fund stipulated in the law.	Sections (a) to (c) above.

Date and

court		Defendants Key claims and causes of action	Key remedies	Represented class	Status / further details	Claimed amount
01/2024	Clal	The action involves the claim that the defendant	Restitution of the all the	The class the plaintiff seeks to represent is	The proceeding is at the	The claimed amount
	Pension	raised the management fees in planholders' accounts	amounts that were unlawfully	all planholders of provident funds and/or	stage of the motion to	was estimated by the
District	and	in the products managed by it without sending them	collected from each of the	study funds and/or pension funds and/or any	certify being reviewed.	plaintiff at more than
Court -	Provident	any notice in advance according to the law.	class members together with	other instrument managed by the		NIS 2.5 million.
Jerusalem	Funds		the returns that said funds	respondent (including savings instruments
			would have yielded in the	which were managed by those replaced by
			accrued savings.	the respondent and anyone who was a
				planholder thereof during the relevant years)
				- including deceased planholders and/or
				their beneficiaries, for whom management
				fees were raised without being notified as
				required by law, during the period starting in
				January 2008 and ending in January 2017,
				with the exception of three price increases
				for which res judicata was granted in Class
				Action 15-03-59823.

	Date and
25.	court		Defendants Key claims and causes of action	Key remedies	Represented class	Status / further details	Claimed amount
	01/2024	Clal Pension	The action involves the claim that the defendant charged management fees at a rate that exceeds the	Restitution of the all the amounts that were unlawfully	The class the plaintiff seeks to represent is all planholders of provident funds and/or	The proceeding is at the stage of the motion to	The claimed amount was estimated by the
	District	and	rate permitted by law, in the accounts of planholders	collected from each of the	study funds and/or pension funds and/or any	certify being reviewed.	plaintiff at more than
	Court - Jerusalem	Provident Funds	with whom contact has been lost or in the accounts of deceased planholders.	class members together with the returns that said funds would have yielded in the accrued savings.	other instrument managed by the respondent (including savings instruments that were managed by those replaced by the respondent and anyone who was a planholder thereof during the relevant period) - including deceased planholders and/or their beneficiaries, from whom management fees were collected at a rate higher than the maximum rate stipulated in Regulation 8 of the Supervision of Financial Services Regulations (Provident Funds) (Management Fees), 2012, during the period beginning on January 1, 2013, (the date of entry into force of the aforementioned regulations) and ending with a final and decisive ruling in the action.		NIS 2.5 million.

	Date and					Status / further
26.	court		Defendants Key claims and causes of action	Key remedies	Represented class	details	Claimed amount
	05/2024	Clal	The lawsuit concerns the allegation that the	To allow all class members to	The class that the plaintiff seeks to represent	The proceeding is	The plaintiff estimated the
		Insurance	defendant offered retired policyholders in the	retroactively choose an annuity track in	consists of policyholders who hold an	at the stage of the	aggregate damage to all class
	District		"Hassneh" policies an annuity track that	accordance with that said in the policy	executive insurance policy issued by	motion to certify	members at approx. NIS 900
	Court - Tel		guarantees a higher number of annuities	(as alleged), and to pay anyone who	"Hassneh" and that is managed by the	being reviewed.	million.
	Aviv		than the annuity track they would have been	chooses this the difference between the	defendant, who chose a different annuity
			entitled to according to the terms and	amount that the policyholder would have	track from the track set out in the policy or
			conditions of the policy, in a manner that has	been entitled to according to the terms	who chose to receive their accrued balance
			reduced the total annuity that the	and conditions of the policy and the	in the policy as a lump sum.

amount actually paid by the defendant, plus linkage differentials and interest.

policyholders received.

	Date and
27.	court		Defendants Key claims and causes of action	Key remedies	Represented class	Status / further details	Claimed amount
	06/2024 District Court - Haifa	Clal Insurance and 7 additional companies	The lawsuit concerns the claim that installers of windscreens, who operate on behalf of the defendants under the "windscreen insurance" rider, do not calibrate the safety systems installed on the vehicle's front windscreen when the dismantle the broken windscreen and install the new (replacement) one, in violation of the provisions of the law; it is also claimed that the defendants did not inform the policyholders - when they purchased the riders - that the latter will not include the testing and calibration of the safety system when the front windscreen is replaced.	Declaratory relief whereby the calibration of the safety system is included in the policy / rider covering damage to the windscreens; a mandatory injunction ordering the defendants to summon Class A to auto repair shops to test and/or calibrate the safety systems; refund the funds, which were collected from Class B members; paying a monetary compensation to all Class C members.	Three classes: A class of consumers who hold or held the riders/windscreen insurance of the respondents in the 7 years preceding the filing of the lawsuit and when they had the windscreen replaced under the rider, the safety system in their vehicle was not tested and/or not calibrated as part of the process of replacing the front windscreen; a class of consumers who hold or held the riders/windscreen insurance of the respondents in the 7 years preceding the filing of the lawsuit and when they had the windscreen replaced under the rider, the installer on behalf of the defendants charged them for testing and/or calibrating the safety system; a class of consumers who own a vehicle equipped with a safety system, who purchased a rider/windscreen insurance from the defendants in the 7 years preceding the filing of the lawsuit, and were not told when they purchased the rider that the coverage will not include testing and calibration of the safety system as part of the replacement of the front windscreen.	The proceeding is at the stage of the motion to certify being reviewed.	The claimed amount was estimated by the plaintiff at more than NIS 2.5 million.

28.	Date and court		Defendants Key claims and causes of action	Key remedies	Represented class	Status / further details	Claimed amount
	07/2024 District Court - Tel Aviv	Clal Insurance	The lawsuit concerns the claim that the defendant pays the insurance benefits and/or refunds insurance premiums to its policyholders by sending checks by mail, allegedly in violation of the guidance of the Capital Market Commissioner, whereunder the funds should be delivered to the policyholders by way of bank transfer or by crediting their credit card. Furthermore, it is claimed that by acting as described above, Clal Insurance also breaches its obligation to pay policyholders the amounts due to them on time, and its obligation to pay interest and linkage differences in respect of the amounts of the checks through the date on which the funds are actually paid.	Issuing a mandatory injunction, which will order Clal Insurance to voluntarily pay the class members the insurance benefits and/or refund the insurance premiums plus linkage and interest from the day on which they become entitled to such payments and until they are actually made; to issue a mandatory injunction ordering Clal Insurance to pay the insurance premiums and/or refund insurance premiums through the same means of payment they used to pay Clal Insurance; and to issue a mandatory injunction ordering Clal Insurance to voluntarily contact its policyholders, if it does not have the means of payment details, and allow the policyholders to select the means of payment through which they wish to use to receive the insurance benefits and/or the refunded insurance premiums.	Anyone who meets one or more of the following conditions: (1) Clal Insurance policyholders, who are entitled to insurance benefits and/or to a refund of insurance premiums and/or any type of refund, to whose registered address and/or their address as updated with Clal Insurance the latter mailed checks, which have not been cashed by the policyholders and/or checks, which were cashed but no interest and linkage differences were added to their amount; (2) Clal Insurance policyholders, whose bank account details or payment card details were held by Clal Insurance on the date on which the abovementioned checks were mailed and/or where Clal Insurance was able to obtain those details during the seven years, which preceded the filing of the lawsuit, or within the normative limit in accordance with the ruling of the honorable court, and through the date, which will be set by the honorable court in its decision; and alternatively, to define the class in any other way it will deem appropriate.	The proceeding is at the stage of the motion to certify being reviewed. In March 2023, the parties submitted a settlement agreement approval motion; the agreement sets an outline for restitution to parties which Clal Insurance credited - through unredeemed checks - for insurance premiums and/or insurance benefits. In March 2025, the Court ordered the furnishing of the settlement agreement to the Attorney General and the Commissioner.	The claimed amount was estimated by the plaintiff at more than NIS 2.5 million.

	Date and					Status / further
29.	court		Defendants Key claims and causes of action	Key remedies	Represented class	details	Claimed amount
	07/2024	Clal	The lawsuit concerns the claim that the	(a) Declaratory relief whereunder the policy	(a) Policyholders insured under a policy,	The proceeding	The claimed amount
		Insurance	defendants unilaterally change the expiry	period of permanent health insurance policies	which includes permanent health insurance	is at the stage of	was estimated by the
	Regional	and	date of the policy period in permanent health	purchased by the classes members ends at the	coverage, whose insurance coverage period	the motion to	plaintiff at more than
	Court -	additional	insurance policies of the classes members to	earlier of the end of the calendar policy period as	will end before the calendar age noted by the	certify being	NIS 2.5 million.
	Haifa	defendants	reflect the policyholder's "insurance age",	requested by the policyholder or on the calendar	policyholders in the insurance offer, or	reviewed.
			which varies from their calendar age, without	retirement age prescribed by law (hereinafter -	before the calendar retirement date	In May 2025, a
			disclosure as required by law, and	the "Calendar Date"), and accordingly issue a	prescribed by law, and have not yet	motion for
			consequently, among other things, the	mandatory injunction requiring the defendants to	experienced an insured event; and (b) past	withdrawal from
			insurance benefits to policyholders, who	extend the insurance coverage period of the	or present policyholders insured in a policy,	the proceeding
			experienced the insured event, are not paid	permanent health insurance of classes members,	which provides a permanent health	against Clal
			until the end of the policy period they	such that the insurance coverage will end on the	insurance coverage, who experienced an	Insurance was
			selected as part of the insurance offer, but	Calendar Date. The plaintiffs also request a	insured event during the period they noted in	filed.
			rather until an earlier date. Furthermore,	declaration to the effect that failure to pay the	the insurance offer, or during the period
			policyholders who have not yet experienced	insurance benefits to Class B members by the	prescribed by law (in accordance with the
			the insured event are at risk that if they	Calendar Date constitutes a breach of the policy;	policyholder's calendar age), but were not
			experience an insured event in the future,	(b) Pecuniary remedy - pay Class B members	paid insurance benefits through the end of
			they will receive insurance benefits by a	insurance benefits through the Calendar Date	the policy period, which was requested or
			date, which is earlier than the end of the	plus linkage differences and interest;	prescribed as described above in the 7 years
			policy period, which they selected as part of	(c) Compensation in respect of the non-pecuniary	before the lawsuit's filing date.
			the insurance offer.	damage totaling NIS 100 to each of the classes
				members.

	Date and

30. court		Defendants Key claims and causes of action	Key remedies	Represented class	Status / further details	Claimed amount
12/2024	Clal	The lawsuit concerns the allegation that Clal	Issuing a declaratory order stating	The class that the plaintiff seeks to represent	The proceeding is at the	The claimed amount
	Insurance	Insurance unlawfully denies health	that imaging-guided injections meet	consists of all Clal Insurance policyholders	stage of the motion to	was estimated by the
District		insurance policyholders' claims for	the policy's definition of "surgery," or,	holding the same policy as the movant, and	certify being reviewed.	plaintiff at more than
Court -		reimbursement of expenses incurred for the	alternatively, the definition of a "non	other Clal Insurance health insurance policies,		NIS 2.5 million.
Central		medical procedure known as "imaging	surgical alternative," as defined in the	of any kind, whose claims for insurance
		guided injection," claiming that this medical	movant's policy and in policies with	coverage due to any kind of imaging-guided
		procedure is not an event that qualifies for	identical and/or similar wording, and	injection Clal Insurance denied, and/or who
		insurance coverage, as it neither meets the	is not subject to the "injection"	were paid a lower compensation amount than
		definition of "surgery" nor of "non-surgical	exclusion, in its various forms; as	the amount they are entitled to be paid for the
		alternative," as defined in the policy.	well as a declaratory order stating	procedure, in accordance with the provisions of
			that Clal is estopped from invoking	their respective policies, subject to the
			the "injection exclusion."	prescription period, and until a final judgment on
				the lawsuit is handed down.

	Date and					Status / further
31.	court		Defendants Key claims and causes of action	Key remedies	Represented class	details	Claimed amount
	02/2025	Clal Insurance	The lawsuit concerns the allegation that Clal Insurance unlawfully requires its	(A) A mandatory injunction to amend the settlement documents; (B) for the members	The classes that the plaintiff seeks to represent consist of: (a) any person who signed a release	The proceeding is at the stage of the	The claimed amount was estimated by the
	District		policyholders to sign an overly broad,	of Class A – to pay each class member	document in favor of the respondent, containing	motion to certify	plaintiff at more than
	Court -		one-sided settlement document it has	whose claim is deemed justified the	a provision that denies the right to compensation	being reviewed.	NIS 2.5 million.
	Central		drafted, which severely prejudices its	compensation amount they are owed, with	for an event which is unrelated to the event for
			policyholders and denies their rights	lawful interest and linkage differences, plus	which the release document was signed,
			with respect to events unrelated to the	NIS 1,000 in damages for non-pecuniary	resulting in the denial of a separate claim which
			event for which the settlement	damage; (C) for the members of Class B – to	is unrelated to the event for which the settlement
			document is signed, allegedly in	inform the policyholder that they may file a	document was signed (hereinafter – "Class A");
			contravention of the law, while	claim for an additional event, which shall be	and (b) any of the respondent's policyholders
			continuing to collect the full premium in	investigated in accordance with the policy's	who signed a release document containing a
			a manner that constitutes a breach of	terms and conditions; to extend the lawful	provision that denies their eligibility for
			the insurance contract, thereby unjustly	prescription period for any date, as required;	compensation for an event which is unrelated to
			enriching itself at the expense of its	and to pay each class member who files a	the event for which the release was signed, and
			customers.	claim which is deemed justified, the total	who did not file another claim against the
				compensation amount they are owed, plus	respondent (hereinafter – "Class B").
				lawful interest and linkage differences, while
				paying each class member NIS 100 in
				damages.

	Date and					Status / further
32.	court		Defendants Key claims and causes of action	Key remedies	Represented class	details	Claimed amount
	2/2025	Clal Pension	The lawsuit concerns the allegation that	Restitution of the funds unlawfully charged to	Anyone to whom the defendant charged and/or	The proceeding is at	The claimed amount
		and	the defendant unlawfully charges to its	the class members, plus linkage differences	attempted to charge funds stemming from their	the stage of the	was estimated by the
	Regional	Provident	planholders debts stemming from the	and interest; damages for non-pecuniary	respective employer's failures, from the date the	motion to certify	plaintiff at more than
	Labor Court	Funds Ltd.	failure on the part of these planholders'	damage; restitution of the (alleged)	defendant first implemented this policy, until the	being reviewed.	NIS 2.5 million.
	- Tel Aviv		respective employers to make pension	enrichment funds in Clal Pension and	date this lawsuit is certified as a class action."
			contributions by the deadlines required	Provident Funds' possession; a prohibition

by law.	on Clal Pension and Provident Funds to
	charge to its planholders any debt stemming
	from failure on part of the respective
	planholder's employer; and an order
	compelling Clal Pension and Provident
	Funds to implement the provisions of
	Section 19A of the Wage Protection Law.

	Date and					Status / further
33.	court		Defendants Key claims and causes of action	Key remedies	Represented class	details	Claimed amount
	04/2025	Clal	The lawsuit concerns the allegation	Restitution of the management fees	Anyone who received a monthly allowance from	The proceeding is at	The claimed amount
		Insurance	whereby Clal's collection of	collected unlawfully from class members,	Clal Insurance, from which management fees	the stage of the	was estimated by the
	Regional		management fees from monthly	plus linkage differences and interest from the	were deducted, and anyone who is expected to	motion to certify	plaintiff at more than
	Labor Court		allowances paid to its policyholders is	collection date through actual payment, and	receive such an allowance until the class action	being reviewed.	NIS 2.5 million.
	- Tel Aviv		non-transparent, illegal and in breach of	the issuance of a permanent injunction	certification date, or until a judgment is rendered
			the terms of the policy. It was also	prohibiting Clal Insurance from collecting	in the lawsuit or until Clal Insurance stops
			claimed that the management fee	management fees from allowances it pays to	collecting management fees from allowances it
			amount increases during the allowance	its policyholders, or any other remedy in	pays, whichever is later.
			payment period, and that Clal Insurance	favor of the public.
			conceals the amount and refuses to
			disclose it.

2.1.3 Material class actions, material claims and motions to certify material claims as class actions which were concluded during the reporting period and until the signing of the report against the Company and the consolidated companies, with the exception of the Max Group companies6

	Date and
1.	court	Defendants		Key claims and causes of action		Key remedies	Represented class	Status / further details		Claimed amount
	7/2019		"Atudot" - Pension Fund for	The lawsuit concerns the allegation		The plaintiffs	The planholders in	In June 2023, the Supreme Court handed down its		The class action
			Workers and Independent	whereby Atudot charges its planholders, in		seek to compel	the pension funds	judgment on the motion for leave to appeal in a motion for		claimed amount was
	Regional		Workers Ltd. (a subsidiary of	addition to management fees, "investment		Atudot to return	who were charged	class certification regarding direct expenses charges in		set at approx. NIS 41
	Court - Tel		Clal Insurance (held at 50%)	management expenses" (hereinafter -		the excessive	investment	private individual life insurance policies (which Atudot was		million, based on an
	Aviv	(hereinafter - "Atudot")		"direct expenses") in the absence of a		direct expenses	management	not a party to), and granted the appeal on the certification		assessment.
				contractual provision that allows it to		amounts they	expenses in the	ruling, stating that insurance companies and management
				charge such expenses and in contrast		were charged.	seven years before	companies serve as trustees for the planholders' funds,
				with the fund's bylaws.			the relevant lawsuit	and are entitled to charge expenses in their capacity as
							was filed.	such.
								In February 2024, a judgment was issued dismissing the
								motion to certify the class action against Atudot.
								In March 2024, the plaintiff appealed to the National Labor
								Court. In March 2025, a judgment was rendered under
								which the appeal was stricken out, at the agreement of the
								parties and further to the Court's recommendation.

	Date and
2.	court	Defendants		Key claims and causes of action	Key remedies		Represented class		Status / further details	Claimed amount
	04/2022	Clal		The lawsuit concerns the allegation	The main claimed remedies are a			The class the movant seeks to represent is: (a) all	In March 2025, a judgment	The plaintiff
		Insurance		that Clal Insurance continues to	declaratory remedy, according to			policyholders who notified Clal Insurance of the policy's	was rendered, which	estimated the
	District			charge premiums from policyholders,	which a policyholder's cancellation			cancellation and Clal Insurance did not cancel their	approved an agreed motion	aggregate
	Court - Tel			even after the latter announce their	notice would take effect within 3 days			respective policy within 3 days from the date of	for withdrawal of the motion	damage to all
	Aviv-Jaffa		policy's	cancellation, as the	from the date of its delivery, and a			delivering the cancellation notice; (b) all policyholders	to certify, in which Clal	class members in
				cancellation takes effect only on the	monetary remedy in the form of			who notified Clal Insurance of the policy's cancellation	Insurance agreed to add a	many millions of
				1st of the following calendar month	returning all premiums policyholders			and whose cancellation notice was somehow	disclosure to the existing	shekels.
				after Clal Insurance receives the	were charged due to the period			inadequate, and Clal Insurance did not notify the	disclosure - prior to the
				notice, rather than within 3 days from	beginning from the fourth day after			policyholders of the inadequacy within 3 business days	purchase of the policy -
			the date	of delivering the	the delivery of the cancellation			from the date of delivery of the cancellation notice; (c)	regarding the date on which
				policyholders' cancellation notices, as notice, and 50% of the average all policyholders who wanted to cancel the policy at any			the cancellation would come
				required in accordance with the	monthly premium as compensation			time in the previous calendar month before the last 3	into effect. It was further
			legislative	arrangement. It was	to the class members whose			days of that month, and delayed their cancellation	agreed to pay the plaintiff and
				claimed that no full disclosure is made	respective cancellation notice had			notice due to the contractual arrangement whereby the	their counsel negligible
				to policyholders of the applicable	been delayed due to the provisions			cancellation would take effect from the 1st of the	amounts.
				arrangement in case the policyholder	of the policy, with added linkage			calendar month following Clal Insurance's receipt of
				cancels the policyholder, before	differences and interest.		the cancellation notice.
			purchasing the policy.

6. Not including lawsuits that concluded in the reporting year, but which were reported as having been concluded in the Financial Statements for 2023.

	Date and
3.	court		Defendants Key claims and causes of action	Key remedies	Represented class	Status / further details	Claimed amount
	12/2022	Clal	The lawsuit concerns the allegation that	The main remedies sought in the	The represented class is all Clal Insurance policyholders	In March 2025, the	The plaintiffs
		Insurance	in the event of damage caused by a	lawsuit are a monetary remedy that	who purchased a trailer and/or towing vehicle third-party	District Court handed	estimated that the
	District		trailer and a towing vehicle, Clal	includes, inter alia, compensation	insurance and/or compulsory insurance policy in the 7	down a judgment in	aggregate damage
	Court - Lod		Insurance (as the insurer for either the	for the deductible paid to the other	years preceding the submission of this motion; or,	which a motion to	the class members
			trailer or the towing vehicle) refuses to	insurer, a refund of the premium to	alternatively or in addition: all Clal Insurance policyholders	withdraw the lawsuit was	incurred exceeds
			pay for the full damage caused to a third	the policyholders, a mandatory	who purchased a trailer and/or towing vehicle third-party	approved, without a costs	NIS 2.5 million.
			party, as it has undertaken to pay in the	injunction ordering Clal Insurance	and/or compulsory insurance policy from it, who had to	order.
			policy, and pays only half of it, on the	to indemnify the third parties for the	pay a double deductible for a single incident of damage
			grounds that the liability for damage	full damage caused in the context	caused to a third party and/or who were forced to pay out
			caused by a trailer or by a towing	of an applicable policy, and a duty	of pocket for half or part of the damage caused to the third
		vehicle must always be divided equally		of disclosure with respect to new	party. On March 2025, the court handed down a judgment
			between them.	policies that have not yet been	confirming a withdrawal motion.
				issued.

	Date and
4.	court		Defendants Key claims and causes of action	Key remedies	Represented class	Status / further details	Claimed amount
	9/2020
		Clal	According to the plaintiff, Clal Insurance	The remedy the plaintiff is	All Clal Insurance policyholders that hold private and	In May 2025, the Haifa	The plaintiff
		Insurance	does not act in accordance with its	petitioning for includes compelling	collective health insurance policies, including extended	District Court handed	estimated the
	District		undertakings, as it regularly refunds its	Clal Insurance to compensate each	health insurance and full liability insurance and including	down a ruling dismissing	damage to all class
	Court -		policyholders for a significantly lower	of the class members entitled to the	policies whose names had been changed over the years,	the motion to certify.	members at NIS
	Haifa		amount than the amount it warranted	no claims bonus for the relative	that include a "No Claims Bonus" clause, who did not		33,575,080 in the
			within the implementation of the "no	share of the insurance premiums	claim and/or refrained from claiming benefits for 3 years		seven years prior to
			claims bonus" clauses in health policies	they were not refunded, with	or any other period in accordance with the policy, and		filing the lawsuit.
			Clal Insurance used to sell, which entitle	interest and linkage.	were entitled to a refund of 10% of the insurance
			policyholders to be refunded part of the		premiums they had paid, or another refund rate according
			insurance premiums they paid if no		to the terms of the policy, and were paid a lower amount
			insurance claims are made over the		than the amount they are owed under the terms of the

2.2 Details regarding exposure to immaterial class actions or claims that have not yet been filed and for additional expenses against the Company and the consolidated companies, with the exception of the Max Group companies

2.2.1 In addition to the material class action lawsuits, described in Note 10(2.1.1), the pending motions to certify material lawsuits as class actions, described in Note 10(2.1.2), and the motions to certify material lawsuits as class actions which were dismissed in the reporting period, described in Note 10(2.1.3), there are pending motions to certify class actions against the Company and its consolidated companies (except for the Max Group Companies) that, according to the Company's estimate, are immaterial,7 and therefore there is no detailed description thereof in the financial statements. As of the date of the report, 5 lawsuits are litigated against the Company and/or its consolidated companies, as said above, not including Max, and the total amount specified by the plaintiffs in these lawsuits is approx. NIS 110.5 million⁸ (compared to 7 lawsuits for approx. NIS 140 million as of December 31, 2024).

2.2.2 Insurance exposures

In addition to the aforementioned legal proceedings, potential exposure also exists, which at this stage can neither be evaluated nor quantified, to the filing of additional derivative claims or class actions against the Group companies, inter alia as a result of the Company's control structure (for further details, see Note 1, as well as Section 2.3 below) as well as exposure arising from the complexity of the companies' products, which may result in disputes arising regarding the interpretation of provisions of the Law or an agreement, including, among other things, pertaining to contractual or commercial terms and conditions, or regulatory directives, including the option available to the Commissioner, under certain circumstances, to order an insurer to cease implementing an insurance plan, or to order it to make changes to an insurance plan, including with respect to policies which have already been marketed by the insurer, or regarding the manner of implementation of the provisions of the Law or an agreement, or the method of claims settlement agreement pursuant to an agreement, which apply to and impact the relationship between the Group companies and the customer and/or the relationship between the Company and third parties, including reinsurers.

This exposure is particularly heightened in the fields of Long-Term Savings and Long-Term Health Insurance, in which Clal Insurance operates, among other things, in view of the fact that in those spheres, some of these policies were issued decades ago, whereas today, in light of significant regulatory changes, and due to the development of both judicial rulings and the Commissioner's position, these policies may be interpreted differently when viewed retroactively, and different interpretative standards may be applied to them than those that were customary when they were drafted. Moreover, the policies in these aforementioned areas remain valid for decades, such that in those cases in which a customer's claim is accepted and new interpretation is attributed to the contents of the policy, there is also potential exposure to the fact that the future profitability of that particular company will be influenced due to the existing policy portfolio. This is in addition to compensation that may be awarded to customers in respect of past activity.

There is also exposure, which at this stage can neither be evaluated nor quantified, to errors in the methods used in the operation of products, chiefly in the areas of Long-Term Savings and Health Insurance. The insurance sector in which the Group companies operate is complex and rich in details, and the regulatory directives tend to change over the years, and it involves an inherent, unquantifiable risk of the occurrence of an error or a series of errors, mechanical or human errors, which may have a sector-wide impact. It is not possible to anticipate all the types of claims to be raised in this context and/or the exposure arising from these potential claims, among other things, via the procedural mechanism of class action lawsuits and/or industrywide rulings made by the Commissioner.

^7. See Footnote 10 above regarding the materiality threshold.

^8. The aforementioned number of lawsuits includes one lawsuit in which Clal Insurance is a formal defendant and no remedies are sought against it. In addition, there is one action which was certified as a class action, in which the plaintiff did not specify the amount, but estimated it in tens of millions of NIS.

Such exposure is also the result of the complexity of the aforementioned products, which are characterized by extremely prolonged lifetime, and are subject to frequent, complex and material changes, including changes in regulatory and taxation directives. The complexity of those changes and their application over many years creates increased operational exposure, which is also due to the numerous different computer systems in the Group's institutional entities, and their limitations, in view of additions and/or changes to the basic wording of the products, and in light of multiple, frequent changes implemented over the product's lifetime, including by the regulatory authorities, the customers (the employees) and/or by the employers and/or by those acting on their behalf, in relation to insurance coverages and/or to savings deposits, including in the context of reporting to planholders, and the need to create direct contact with employers and operating entities.

This complexity and these changes have an impact, among other things, on the volume of contributions and the amounts involved, the various product components, the manner in which funds are attributed to employees (including due to discrepancies between the employer's reports, including through the employers' interface with the policy data), products and components and selected investment and insurance tracks, dates of payment appropriations, the identification of arrears in deposits and the handling of such cases, the employment, personal and underwriting status of customers, as well as operational considerations involving third parties outside the Group, which affect customer rights together with the information given to them. This complexity intensifies in view of the increasingly large number of parties operating with the Group's member companies in relation to the management and operation of the products, including, among other things, distributors, employers, customers and reinsurers, including in relation to the ongoing interface with them, and contradictory instructions that may be received from them or their representatives. The institutional entities that are members of the Group are engaged in a constant effort to study, identify and address issues that may arise due to the aforementioned complexities, both with regard to specific cases, and also in relation to customer and/or product types.

There is additional complexity regarding employer contributions that is related to the mechanism prescribed in the Wage Protection Law, 1958, according to which an amount owed by an employer to a provident fund, as this is defined in that law, in respect of the employee's rights or those of his replacement toward the provident fund, is deemed to have been paid on time unless the Regional Labor Court has determined that the delay in the collection of the debt was not the result of negligence on the part of the Fund, or occurred due to other justified circumstances, and subject to the right of indemnity available to the fund in relation to the employer, pursuant to the provisions of the law. Furthermore, pursuant to a circular relating to the manner of depositing payments into provident funds, the provident fund shall receive interest on arrears from an employer who has failed to transfer payments to the provident fund on time. There are various difficulties in the interpretation of the provisions of the Law and their implementation. The responsibility of the institutional entities in the Group for the collection of employers' debts to the said funds generates exposure in the event of defects occurring during the collection process.

Moreover, the institutional entities in the Group carry out a regular, routine process of data cleansing in the Long-Term Savings IT systems, in order to ensure that the registration of the planholders' and policyholders' rights in the data systems is complete, accessible and retrievable, in view of the discrepancies that are discovered from time to time, including the issue of mechanization of the classification of the saving funds, pursuant to the various levels of the provisions of the regulation issued over the years, and which are in various stages of being addressed. The institutional entities in the Group are unable to estimate the scope, costs and the full ramifications of the aforementioned actions, or the scope of the future data cleansing discrepancies, which may also be the result of regulatory changes, as this is due, among other things, to the complexity of the products, the fact that they are long-term products, in view of the multiplicity of IT systems in this sphere and their limitations. The institutional entities in the Group update their insurance liabilities from time to time and as is required.

In this context, it should be noted that in December 2021, Clal Insurance received a letter outlining the implementation of regulatory restrictions regarding the collection of insurance coverage costs pursuant to the Income Tax Regulations (Rules for Approval and Management of Provident Funds), 1964, containing demands to refund amounts allegedly collected in breach of the restrictions set forth in the letter. The Company is currently engaged in discussions with the Authority regarding the implementation of the contents of the letter, and at this stage there is no certainty regarding the full amount it may be required to refund due to the said letter - and it is unable to estimate the full implications arising from the requisite implementation of the directives.

There is also exposure, which at this stage can neither be evaluated nor quantified, to changes and to significant regulatory intervention in the various insurance and savings sectors, including, among other things, those which are intended for the direct or indirect reduction of insurance premiums and management fees, intervention in sales processes, involving the different use of diverse regulatory tools, which may have an impact on the contractual terms and conditions, the structure of the contractual engagement and the reciprocal relations among institutional entities, agents, employers and customers, in a manner that could influence the load and the operating expenses, profitability, retention of current products, including in relation to the specific sector business model and the existing product portfolio.

The Group is also exposed, in a manner that cannot be evaluated, to legal claims related to contract laws and the fulfillment of insurance liabilities as part of the insurance policy or implementation of the provident funds' bylaws, breach of fiduciary duty, conflicts of interest, professional negligence, and also including in respect of the manner of distribution and sale of the Group's products, via third parties, whose activities, either by action or omission, may be binding upon it.

2.2.3. Additional exposures

2.2.3.1 Immaterial or yet unfiled claims

The exposure to currently unfiled legal actions against the Group's member companies is brought to their attention in a number of ways. This is done, among other things, by inquiries made by customers, employees, suppliers, non-profit organizations or anybody acting on their behalf to various functions in the companies, and especially the compliance officer responsible for public inquiries in the Group's member companies, via customer complaints to the Public Inquiries Unit in the regulator's office, and via legal actions (that are not class actions) filed with the court and also via position papers of the Commissioner.

Note that insofar as this concerns a customer complaint to the regulator's Public Inquiries Unit, then, in addition to the risk that the customer chooses to assert their allegations in a class action lawsuit as well, Group companies are also exposed to the risk that the regulator resolves the complaint by issuing an industry-wide ruling, which could apply to a broad category of customers and/or by publishing a position statement (or a draft ruling or position). For further details regarding industry-wide rulings and position papers, see Section 2.2.3.2 below.

Moreover, pursuant to the regulatory directives applying to institutional entities, as part of a circular on the adjudication and settlement of claims and addressing public inquiries, in cases in which a public inquiry indicates a systemic, significant defect, which could well be repeated in an institutional entity's regular conduct, that institutional entity must act to identify similar cases in which a similar defect has occurred, and insofar as similar cases are identified - it must develop insights and rectify the defects within a reasonable period of time. This amendment may expand the Group's exposure to the industrywide implications in respect of the said defects.

2.2.3.2 Exposure of the Group companies due to regulatory directives, audits and position papers

A. Furthermore and in general, in addition to the overall exposure to which the Group companies are exposed, in respect of future claims, as detailed in Section 10 (2.2.2) above, from time to time, including due to complaints of customers and suppliers, audits and requests for information, there is also exposure to warnings concerning the intention of a regulatory authority, to impose financial sanctions and/or directives on the supervised consolidated companies regarding amendment and/or refunding and/or taking of certain actions pertaining to past actions and/or change in behavior, among other things, with regard to a customer or a group of customers, and/or exposure in respect of industry-wide rulings, under which directives may be issued to pay out refunds to customers, or to provide other remedies in respect of the defects to which the warnings or rulings and/or position papers published by supervisory entities related, and whose status and degree of impact are not certain. The Group's member companies are also involved, from time to time, in hearing and/or discussion proceedings with supervisory authorities in relation to warnings and/or rulings, and enforcement powers are sometimes employed against them, including the imposition of financial sanctions.

The Group's member companies are examining the need to make provisions in the financial statements in respect of the aforesaid processes, based on the professional opinion of their legal counsel and/or are in the process of learning the ramifications of the said proceedings, as is deemed to be necessary and relevant.

B. Following are details regarding positions or draft positions of the Commissioner or theoretical rulings that either have or may have an impact on the Group:

Pursuant to the financial statements of Atudot, a company owned by Clal Insurance (50%), during 2017 an audit of the pension fund was conducted on behalf of the Commissioner focusing on the subject of planholders' rights. On August 7, 2019, Atudot received the draft audit report for its response. The draft audit report addressed key issues of the pension fund's activity, including: the subject of groups, the fund's regulations, management fees and management expenses, data cleansing, actuarial reporting and withdrawal of money from the fund. Atudot filed its response to the draft audit report findings and held a number of meetings to discuss them with the Commissioner's representatives. The Company was informed that on August 21, 2022, Atudot received the final audit report that included directives and recommendations for the Board of Directors on a number of topics, among other things, an examination of the issue of actuarial bubbles and all their ramifications; including their application. It also addressed the issue of how to deal with them, greater coherence between the average duration of the assets and liabilities in each actuarial bubble, etc.; as well as finding solutions to the problem of funding sources to manage the fund in the future given the fact that it is a closed fund; optimization of the method of payment to planholders, expansion of the data cleansing process, together with certain recommendations for amendments to the regulations and expanding the notes, etc. Furthermore, the Commissioner recommended considering the possibility of adopting the redemption values formula prescribed in the Income Tax Regulations, in order to encourage the fund's planholders to realize the funds as an annuity rather than a capital withdrawal. The Company was informed, that with regard to a significant part of the recommendations, and particularly on issues pertaining to the actuarial bubbles, adapting the average duration of assets to liabilities and the redemption formula - it was determined in the audit report that Atudot's Board of Directors must draw up its position on these matters, and that the recommendation is not binding specifically with respect to the manner of treating those issues; and also that as of the approval date of the financial statements, discussions were being held with the Authority in order to reach an agreed model on actuarial bubbles, while a concrete plan of action was devised to address other issues which is being implemented by the Fund. In view of the aforementioned, Atudot is unable to evaluate the full implications of the audit report on its financial statements.

2.3 Agreed order under the Economic Competition Law – Hyp

Further to Note 45(2)(4) to the 2024 Consolidated Financial Statements regarding the examination - by the Israel Competition Authority - of Hyp Payment Solutions Ltd., a sub-subsidiary of the Company (hereinafter - "Hyp"), with respect to conduct, which gives rise to concerns of breach of the provisions of the Economic Competition Law, 1988 (hereinafter - the "Economic Competition Law"), concerning the interface of new acquirers - in April 2025, Hyp informed the Israel Competition Authority that it agrees to pay a total of NIS 11 million to the State Treasury, under an agreed order, in accordance with Section 50B to the Economic Competition Law. Subject to the approval of the consensual decree by the Competition Court and the payment of the said amount, and bearing in mind that the breach has stopped, it is the position of the Competition Commissioner, that they shall not take no enforcement measures against Hyp or anyone acting on its behalf, in respect of the breach, which - according to the Competition Commissioner's position - was committed by Hyp; the alleged breach entails an alleged refusal by Hyp to provide payment gateway services under reasonable terms to the acquirers of new payment cards, thereby - at the very least - delaying their authentication or discriminating between them and the existing acquirers, during the period between October 1, 2022 to March 31, 2024. It is clarified that the consensual decree or Hyp's signing the decree does not constitute any admission or agreement on behalf of Hyp, or anyone acting on its behalf, that they breached the Economic Competition Law, the Commissioner's decisions or any other law in any way. The consensual decree requires the approval of the Competition Court.

2.4 Summary of exposures to lawsuits against the Company and the consolidated companies, not including the Max Group Companies

2.4.1 Following are details of the overall amount of claims in both material and immaterial class actions which were certified to be filed as class actions, in pending class action certification motions and a derivative claim, as (nominally) stated by the plaintiffs in their claim as part of the pleadings filed against the Company and the consolidated companies, except companies of the Max Group. It is noted that in the State of Israel, filing class action lawsuits does not entail payment of a fee derived from the claimed amount; therefore the amounts of

such claims may be significantly higher than the actual exposure for that exposure. In the majority of cases, the plaintiffs point out that the amount claimed by them is stated as an estimate alone, and the exact amount shall be decided upon as part of the legal proceeding. It is further noted that the aforementioned amount does not include claims for which the lead plaintiff did not state their amount (Section b(3) in the table below). Moreover, it is clarified that the claimed amount does not necessarily constitute quantification of the Company's actual exposure amount, which may eventually transpire to be lower or higher,9 as on numerous occasions the plaintiffs refrain from stating the precise claimed amount or state that the amount exceeds NIS 2.5 million for the claim to be heard under the jurisdiction of the District Court, and the exposure due to these claims could be substantially higher than noted, and that the claimed amount usually relates to the period preceding the date of filing suit and does not include the following period.

					Claimed
					amount
			No. of	in NIS
			claims		million
		Type of claim	(Unaudited)
A.		Claims certified as class actions10
	1.	An amount relating to the Company has been specified		5	3,981
	2.	The claim was filed against several parties and no specific amount was attributed to
		the Company		1	48
	3.	No claimed amount was provided11		4	-
B.		Pending motions to certify claims as class actions
	1.	An amount relating to the Company has been specified12	11		1,702
	2.	The claim was filed against several parties and no specific amount was attributed to
		the Company13		5	8,267
	3.	No claimed amount was provided / a potential range was detailed14	21		-
	4.	An annual amount was specified (and accordingly, the total amount depends on the period)15		1	7

In addition to that specified in Sections 10(1) and 10(2) above, the Company and/or the consolidated companies are parties to other legal proceedings, in addition to the lawsuits outside the ordinary course of business, that are considered immaterial and are not class actions or derivative actions, and that mainly include lawsuits brought by customers, former customers, and various third parties, outside of regular lawsuits to exercise rights under insurance contracts or provident fund bylaws, at a total alleged amount of approx. NIS 41 million as of March 31, 2025 (approx. NIS 39 million as of December 31, 2024). The causes of action within these proceedings are many and varied.

^9. It should be noted further that the specified amounts do not include the amounts the plaintiffs claimed as the lead plaintiff's reward and their counsel's legal fees and they do not include an increase in the amounts of the lawsuit in respect of the period from the date it is brought, as applicable.

^10. Including a lawsuit that had been certified as a class action and in which a judgment was rendered in favor of granting the lawsuit.

^11. These lawsuits include a lawsuit that has been estimated in hundreds of millions of shekels, a lawsuit that has been estimated in tens of millions of shekels, and a lawsuit in which we serve as formal defendants.

^12. These lawsuits include a lawsuit in which the movants estimated the claimed damage against Clal Insurance due to the period from March 8, 2020, to April 30, 2020, at NIS 103 million, and noted that the damage will continue to accrue as long as the collection is not terminated.

^13. Including a lawsuit in which Clal Insurance was sued for approx. NIS 1,413 million attributed to it and, in addition, NIS 1,550 million attributed jointly to the two companies.

^14. Lawsuits in which the plaintiff estimated the claimed amount at more than NIS 2.5 million - the threshold of the subject-matter jurisdiction of the District Court. It is noted that among these motions there is one motion, which was served with respect of a lawsuit which was filed both against Clal Insurance and against Max, see Sections 2.1.2.10 and 3.1.2.5 above and below.

^15. The motion was brought in March 2020. According to the plaintiff, the lawsuit ought not to be subject to prescription. Alternatively, the claim for pecuniary remedies is made for the period starting 7 years before the lawsuit was filed, and until the lawsuit is certified as a class action lawsuit.

2.4.2 Regarding the Companies and the consolidated companies, except the Max Group companies, in respect of the costs that may derive from the claims and exposures described in Sections 10(1) and 10(2) above, provisions are made in the financial statements of the relevant consolidated companies, only if it is more likely than not - namely, with a probability exceeding 50% that a payment liability owing to past events may arise, and that it will be possible to quantify or estimate the liability amount within a reasonable range.

The amounts of the provisions made are based on assessment of the degree of risk in each of the claims, immediately prior to the date of publishing this report (apart from some of the claims that were filed during the last two quarters, and due to the preliminary state of their treatment it is not possible to estimate their chances of success). In relation to this matter, it should be noted that events occurring during the litigation process may require renewed assessment of this risk. Insofar as the Company has the right of indemnity from a third party, the Company acknowledges this right, if it is virtually certain that the indemnity will be obtained if the Company settles the liability.

The assessments of the Company and of the consolidated companies regarding the assessed risk in the claims being conducted are based on the opinions of their legal counsel and/or on the estimates of the relevant companies, including pertaining to the settlement agreement amounts, which the Company's and consolidated companies' management expect to be paid by them, more likely than not.

It should be stressed that in the professional opinion of the attorneys in relation to the majority of motions to certify in which no provision was made, the attorneys' estimate relates to the chances of the class action certification motion being approved and does not relate to the odds of the claim itself, should it be certified as a class action. This is so, among other things, as the scope and content of the hearing on the claim itself, after it is certified as a class action, will be influenced by the court's ruling to certify the claim as a class action, which usually relates to both the causes of action that have been approved and those that have not; the reliefs that have been approved and those that have not; etc.

Many of the motions to certify lawsuits as class actions have been filed against the Group on various matters related to insurance contracts and the Group's ordinary course of business, for which the Group has allocated insurance reserves.

At this preliminary stage, it is impossible to assess the likelihood that the motions to certify class actions reported in Sections 10 (2.1.2) (33), (34), (35), and (36) would be granted.

The provision in the financial statements with respect to the Company and the consolidated companies, excluding the Max Group Companies, as of March 31, 2025, for all the lawsuits and the exposures described in Sections 10 (1) and 10 (2) above, totals approx. NIS 509 million (approx. NIS 500 million as of December 31, 2024).

These amounts include provisions made in respect of past liabilities in accordance with the legal counsels' assessment, and do not include the assessments' effect on the estimated future cash flow, which are included, as necessary, in the liability adequacy testing.

3. Exposures against the Max Group companies

During the regular course of business, material legal claims were filed against Max,16 whose filing as class actions has been certified; pending motions for certification of material claims as class actions; material and immaterial class actions which were concluded during the reporting period and until its signing and other material claims.

16. It is noted that, in general, in this note, a lawsuit against Max would be classified as material and described according to a qualitative or quantitative assessment carried out by Max. Regarding the quantitative assessment – a lawsuit shall be considered material insofar as the total actual exposure, net of tax and assuming the lawsuit is found to be justified and regardless of the lawsuit's chances or the propriety of the amount specified in it on their merits, may exceed 1% of Max's equity as of the reporting date, as detailed in the equity note in the Company's periodic report. Further to Section 10.3.6 of Chapter A of the Company's Annual Reports for 2023, regarding the guidelines and rules the Company has adopted for examining the nature of a specific event or matter for immediate reporting purposes under Regulation 36 of the Securities Regulations, and further to that stated in Note 10, Section 2, of the Company's financial statements, in connection with the description of contingent liabilities and lawsuits filed against the Company and its subsidiaries, and in light of the fact that since the second quarter of 2023, the Company also fully consolidates Max's statements, which are prepared in accordance with the Banking Supervision Department's reporting directives – the Company wishes to clarify that the disclosure of lawsuits filed against Max in these statements does not necessarily indicate that the lawsuit is material for the purposes of the Company's immediate reports, as detailed above, and therefore, not all such lawsuits and/or development therein are disclosed in an immediate report.

With respect to Max,17 the disclosure format is in accordance with the Banking Supervision Department's instructions, such that material lawsuits are disclosed. Regarding the provisions in the financial statements, the lawsuits filed against Max are classified into three categories, as follows:18

Probable risk the probability that the risk will materialize exceeds 70%. Provisions are made in the financial statements for lawsuits in this risk category.
Reasonably possible risk the probability that the risk will materialize ranges from 20% to 70%. No provisions were made in the financial statements due to lawsuits in this risk category.
Remote risk the probability that the risk exposures will materialize is less than or equal to 20 percent. No provisions were made in the financial statements due to lawsuits in this risk category.

The financial statements include adequate provisions for lawsuits, in accordance with the management's assessment and based on assessments by Max's external legal counsels, in accordance with the above.

The total exposure, as assessed by Max based on the assigned external counsels' risk assessment, as detailed below, due to lawsuits filed against Max on various issues, each of which exceeds NIS 1 million, and whose possibility of materializing is not remote, is NIS 207 million (hereinafter - the "Exposure to Non-Remote Lawsuits")

It is further noted that in the State of Israel, filing class action lawsuits does not entail paying a fee that derives from the claimed amount, and therefore, the claimed amounts in non-remote lawsuits may greatly exceed the actual exposure. In the majority of cases, the plaintiffs point out that the amount claimed by them is stated as an estimate alone, and the exact amount shall be decided upon as part of the legal proceeding. Moreover, it is clarified that the amount claimed does not necessarily constitute quantification of the Company's actual exposure amount, as on numerous occasions the plaintiffs refrain from stating the precise claim amount or state that the amount exceeds NIS 2.5 million for the claim to be heard under the jurisdiction of the District Court, and that the amount claimed usually relates to the period preceding the date of filing suit and does not include the following period nor does it relates to the exposure to legal expenses, legal fees and compensation for the plaintiff.

Following are details of material proceedings against Max as of the report publication date.

^17. With respect to CIMax Group companies other than Max or companies under its control, the provisions of Section 2.4.2 above shall apply with respect to the above in connection with the policy on accounting provisions.

^18. The risk assessments are based on the opinions of the legal advisors who handle the lawsuits and/or Max's estimate, including an estimate of the amounts of the expected settlement agreements, that Max's management anticipates will be concluded. In the first stages after the receipt of the claim, in a period of up to 4 quarters, it is not possible to assess the chances of the motions to certify the actions and therefore no provision is made for them.

3.1.2 Pending motions to certify material claims as class actions against Max Group companies19

Date	and

1.	court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / further details		Claimed amount
	5/2019 District Court - Tel Aviv Jaffa	Max	The lawsuit concerns the allegation that Max is in breach of the provisions of its agreement with the plaintiff – a company that receives acquiring services from Max (or, alternatively, that Max is implementing its provisions unlawfully), as when a transaction is partially canceled, the acquiring fee refund for the relative share of the canceled transaction is lower than the transaction cancellation fee Max charge.	To refund the cancellation fee the class members were charged in contrast with the provisions of the agreements and/or as a result of unlawful implementation thereof.	According to the Supreme Court's decision - all Max's customers who are merchants whose set of contracts with Max contains identical or similar clauses to those appearing in specific clauses of the acquiring agreement (as defined by the court) and in the cancellation fee rate chart, from whom Max charged a cancellation fee.	In April 2022, the District judgment, in which the denied. In July 2022, the judgment to the Supreme In August 2023, rendered a judgment appeal, and certified action. Therefore, the the District Court of class action lawsuit on The parties conducted attempt to conclude of a compromise, which	Court rendered its motion to certify was plaintiff appealed the Court. the Supreme Court in favor of granting the the lawsuit as a class case was returned to Tel Aviv to hear the its merits. mediation in an the proceeding by way ultimately failed.	The plaintiff estimates the total claimed amount for all class members at approx. NIS 22 million as of the motion to certify stage.
2.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / further details		Claimed amount
	7/2018 District Court - Tel Aviv Jaffa	Max and 2 additional companies	The lawsuit concerns the allegation that the defendants enabled the activity of companies engaged in direct marketing of transactions to the elderly for many years, despite knowing that these companies were acting unlawfully and taking advantage of the elderly.	To order the respondents to return all the funds from the elderly population's transactions with the direct marketing businesses (unless it is proven that the transactions were made lawfully), to return the fees they collected as a result of the transactions, to compensate the customers for the non pecuniary damage they incurred, and to terminate the engagement with the relevant companies.	The respondents' elderly customers and/or their heirs, whom the direct marketing companies charged in respect of products and/or services and/or club memberships and/or delivery charges they had ordered from the marketing companies and/or due to any other charge that they have not duly authorized and/or without being given adequate consideration in the seven years prior to the motion to certify.	In December 2021, submitted his proceedings, according certain circumstances, impose a mandate companies, in their intervene in a transaction improper pressure on by direct-marketing In August 2022, the a judgment that denied In November 2022, appeal against the Court.	the Attorney General position regarding the to which, under it is appropriate to on credit-card capacity as issuers, to executed due to an elderly customer companies. District Court rendered the motion to certify. the plaintiffs filed an ruling with the Supreme	The plaintiffs estimate the total claimed amount for all class members at NIS 900 million.
3.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented	class	Status / further details	Claimed amount
	06/23 District	Max and Max IT Credit (a	The motion to certify concerns plaintiff's allegation that the defendants announce the end of the limited-time	the To refund of the excessive charged after the benefit date without duly	card fee The defendants' expiration were given notifying of the exemption	customers who a limited-time from card fees benefit,	The proceeding is at the stage of the motion to certify being reviewed.	According to the plaintiff, the amounts may sum up to tens of

Court - Tel Aviv wholly owned Max subsidiary) card fee exemption benefit only in the account statements, but not in a specific notice, which the plaintiff claims is contrary to the Banking Rules (Customer Service) (Full Disclosure and Delivery of Documents), 1992. benefit's expiration. In addition, mandatory injunctions ordering the defendants to change their conduct and give the customers prior notice of the benefit's expiration, as per the law. and from whom the defendants started charging the card fees without notifying them in a specific notice and/or via text message (not within the monthly statements). The parties agreed to refer the proceeding to mediation. millions of shekels, and therefore it estimates the lawsuit amount, at this stage, at over NIS 3 million.

19. Including such motions which were denied and the ruling to deny them was appealed.

	Date and
4.	court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / further details Claimed amount
	03/2024	Max and 1	The motion to certify involves the claim	Compensation and/or restitution of	Any customer of the defendants,	The proceeding is at The plaintiff
		other	that Bank Leumi and Max raise the	the difference between the price that	whose express consent was not given	the stage of the estimates the claim
	District		card fees for their customers without a	the customers originally paid and the	or who was not actively informed about	motion to certify being amount at over NIS
	Court -		proper update. It is argued that,	amount which was actually charged,	the increase of the price of services	reviewed. 2.5 million.
	Tel Aviv		according to the law, the defendants	without them being duly notified of the	involving the credit card prior to the	The parties agreed to
			have the duty to notify of changes of	increase in card fees. And, in addition,	increase in the price of the services, in	refer the proceeding to
			this type, in an effective manner, in a	a mandatory injunction instructing the	the 7 years preceding the submission	mediation.
			separate and clear notice and/or in a	defendants to actively inform their	of the motion to certify and until the
			prominent manner that will allow the	customers of any increase in the price	date of certification of the motion as a
			notice regarding the increase in card	of the service, as part of a separate	class action.
			fees (or collection of payments) to be	and clear notice on the website,
			distinguished from other current	including in the application.
			notices. All of the above is contrary to
			the duties of good faith and disclosure
			that apply to the defendants.

5. Regarding a pending motion to certify a material claim as a class action lawsuit which was brought against the Company and against Max, see Note 10(2.1.2.7) above.

3.2 Another material lawsuit outside the ordinary course of business brought against the Max Group Companies

In December 2016, Max received a VAT assessment for the billing periods from January 2012 to August 2016 (hereinafter - the "Assessment"), which mainly concerned charging Max the full VAT for fees Max received due to transactions between holders of Max-issued credit cards and overseas merchants abroad; the Assessment also concerns the denial of an inputs tax deduction for inputs attributable to its operations in Eilat, according to the VAT authorities. In March 2017, Max filed an objection to the Assessment, and in March 2018, Max received the ruling on the objection and a revised VAT assessment (hereinafter - the "Revised Assessment"). In the ruling on the objection, the VAT Directorate (hereinafter - the "Directorate") dismissed Max's claims in the objection, and even changed its arguments in connection with the fees Max received in respect of transactions between Max-issued credit card holders and overseas merchants. As a result, the charge in the Revised Assessment was adjusted upward to NIS 86 million, plus linkage differences and interest from the date of issuing the Revised Assessment.

In January 2019, Max appealed the ruling on the objection before the Tel Aviv District Court, and at the Directorate's request, the hearing was consolidated with the hearing on appeals by two credit card companies, on similar issues (hereinafter - the "Consolidated Appeal"). In the Directorate's response in the Consolidated Appeal, the Directorate held, with respect to the portion of the Assessment charge attributed to Max's operations in Eilat, that in light of Max's claims and the specific circumstances, it intends to reduce the relative portion attributed to the above operations from the Assessment charge, without this having any future ramifications. As a result, the revised total charge in the Assessment is expected to be approx. NIS 83 million, plus linkage differentials and interest from the date of issuing the Revised Assessment.

In September 2021, Max received a VAT assessment for the billing periods from September 2016 to June 2020 (hereinafter - the "Second Assessment"). The Second Assessment deals with charging the full VAT for the fees whose taxability is discussed in the Consolidated Appeal, as well as additional fees. In January 2022, Max filed an objection to the Second Assessment, and over June-November 2022, the parties negotiated a settlement with respect to the assessments specified above, while the evidentiary hearings were carried out at the same time. In November 2022, the State Attorney announced the end of the settlement negotiations in light of its position that it wishes to have the case decided by the court. The case is at the summation stage.

In January 2023, the Directorate issued a ruling in which it rejected Max's objection to the Second Assessment, and charged Max NIS 180 million due to this period, plus linkage differences and interest from the date the Assessment was issued. In March 2023, Max appealed this ruling to the District Court. In June 2023, the Directorate withdrew the charge due to Max's activity in Eilat, and therefore, this charge under the Assessment was canceled. In July 2023, an arrangement was approved, according to which the court's determinations in the consolidated appeal will also apply to the appeal regarding the second assessment. Max included a provision in its financial statements in respect of the VAT assessments, based, among other matters, on the estimate of its external legal counsel who are providing guidance for the claim, and based on the talks held to formulate the settlement agreement, which did not materialize. The provision includes the period after the periods of the assessments, until March 31, 2025.

NOTE 10 - CREDIT RISK, RECEIVABLES FOR CREDIT CARD TRANSACTIONS AND CREDIT LOSS PROVISION

A. Credit and receivables for credit card transactions

	As of March 31		As of December 31
In NIS million Credit risk guaranteed by banks and others:	2025	2024	2024
		Unaudited
Credit risk without bank guarantees:
Private individuals: (1)
Of which: Receivables for credit card activity (2)	4,082	3,987	4,606
Of which: Credit cards (2)(3)	10,775	9,314	10,431
Private individuals - total	14,857	13,302	15,037
Commercial:
Of which: Receivables for credit card activity (2)	351	274	313
Of which: Credit (2)(3)(4)	1,138	1,012	1,069
Commercial - total	1,489	1,286	1,382
Total credit risk without bank guarantees	16,346	14,588	16,419

International credit card companies and organizations	409	329	294
Revenue receivable	49	50	53
Other	222	171	209
Total receivables for credit card transactions	17,026	15,138	16,975
Credit loss provision	(365)	(358)	(373)
Total receivables for credit card transactions	16,661	14,780	16,602
Receivables for credit cards guaranteed by banks	1,191	1,111	1,253
Receivables for credit card transactions, net	17,852	15,891	17,855

(1) Private individuals, as defined in the Reporting to the Public Directives - Report of the Board of Directors and Management, regarding Total Credit Risk by Market Sector on a Consolidated Basis.

(2) Receivables for credit cards without a charge for interest, including balances for ordinary transactions, transactions in payments at the expense of the merchant, and other transactions. The balance does not include debts from non-bank payment cards issued by the Company, which were sold to several banks under transactions constituting a full and complete sale. In the first quarter of 2025, the Company increased the scope of such transactions.
(3) Credit with interest, including credit transactions, revolving credit card transactions, direct credit, credit for non-card holders, and other transactions.
(4) Including credit secured by vehicles amounting to NIS 3,638 million (December 31, 2024 NIS 3,359 million, March 31, 2024 NIS 2,431 million).

B. Debts and off-balance-sheet credit instruments*

1. Change in outstanding credit loss provision

	For the three months ended March 31, 2025
		Credit loss provision
	Credit risk without bank guarantees
	Private individuals
	Receivables for credit			Commercial Receivables for credit
	cards		Credit(1)	cards	Credit(1) Other(2)	Total
In NIS million				Unaudited
Balance of credit loss provision
as of December 31, 2024		22	296	4	60	6	388
Credit loss expenses		2	44	‐	‐	‐	46
Charge-offs		(5)	(55)	(1)	(4)	‐	(65)
Collection of debts written off in previous years		‐	10	‐	1	‐	11
Charge-offs, net		(5)	(45)	(1)	(3)	‐	(54)
Balance of credit loss provision
as of March 31, 2025 (3)		19	295	3	57	6	380
Of which: (3)
For off-balance sheet credit instruments		11	‐	2	‐	2	15
For deposits with banks and amounts receivable
from banks		‐	‐	‐	‐	2	2

* Receivables for credit card transactions, deposits with banks, and other debts.

(1) Interest-bearing credit. This credit includes credit transactions, revolving credit card transactions, credit for card holders, credit non-card holders and other transactions.

(2) Amounts receivable from banks, deposits with banks, global credit card companies and organizations, revenue receivable, and other accounts receivables.

	For the three months ended March 31, 2024
	Credit loss provision
	Credit risk without bank guarantees
	Private individuals
	Receivables for credit			Receivables for credit
	cards	Credit		cards	Credit	Other		Total
In NIS million				Unaudited
Balance of credit loss provision
as of December 31, 2023		24	297	5	60		4	389
Credit loss expenses		2	34	‐	5		‐	41
Charge-offs		(5)	(53)	‐	(6)		‐	(64)
Collection of debts written off in previous years		‐	6	‐	1		‐	7
Charge-offs, net		(5)	(47)	‐	(5)		‐	(57)
Balance of credit loss provision
as of March 31, 2025 (3)		21	284	5	60		4	373
Of which: (3)
For off-balance sheet credit instruments		11	‐	2		‐	2	15
For deposits with banks and amounts receivable
from banks		‐	‐	‐		‐	4	4

* Receivables for credit card transactions, deposits with banks, and other debts.

(1) Interest-bearing credit. This credit includes credit transactions, revolving credit card transactions, credit for card holders, credit non-card holders and other transactions.

(2) Amounts receivable from banks, deposits with banks, global credit card companies and organizations, revenue receivable, and other accounts receivables.

1. Additional information on calculating the credit loss provision for debts and for the debts for which it was calculated

	As of March 31, 2025
	Private individuals			Commercial
	Receivables for credit cards	Credit(1)		Receivables for credit cards		Credit(1)	Other(2)	Total
In NIS million				Unaudited
Recorded outstanding debt:
Examined on a specific basis		3	30		67	663		‐	763
Examined on a collective basis	4,079	10,745			284	475	2,532		18,115
Total debts	4,082	10,775			351	1,138	2,532		18,878
Non-performing debts	14		137		3	26		‐	180
Other troubled debts		6	375		1	35		‐	417
Total troubled debts	20		512		4	61		‐	597
Credit loss provision in respect of debts:
Examined on a specific basis		‐	‐		‐	19		‐	20
Examined on a collective basis		8	294		1	38		4	345
Total credit loss provision		8	294		1	57		4	365
Of which: For non-performing debts		2	59		1	17		‐	79
Of which: For other troubled debts		‐	38		‐	4		‐	42

* Receivables for credit card transactions, deposits with banks, and other debts.

(1) Interest-bearing credit. This credit includes credit transactions, revolving credit card transactions, credit for card holders, credit non-card holders and other transactions.

(2) Amounts receivable from banks, deposits with banks, global credit card companies and organizations, revenue receivable, and other accounts receivables.

	As of March 31, 2024
	Private individuals		Commercial
	Receivables for credit cards	Credit(1)		Receivables for credit cardsCredit(1)		Other(2)	Total
In NIS million				Unaudited
Recorded outstanding debt:
Examined on a specific basis		2 12		61	565	‐	640
Examined on a collective basis	3,985	9,302		213	447	2,265	16,213
Total debts	3,987	9,314		274	1,012	2,265	16,853
Of which:
Non-performing debts	12	138		3	24	‐	177
Other troubled debts		5 328		2	36	‐	371
Total troubled debts	17	466		5	60	‐	548
Credit loss provision in respect of debts:
Examined on a specific basis		‐	‐	‐	26	‐	26
Examined on a collective basis	10	282		2	35	3	332
Total credit loss provision	10	282		2	61	3	358
Of which: For non-performing debts		2 54		1	14	‐	71
Of which: For other troubled debts		‐ 33		‐	6	‐	39

* Receivables for credit card transactions, deposits with banks, and other debts.

(1) Interest-bearing credit. This credit includes credit transactions, revolving credit card transactions, credit for card holders, credit non-card holders and other transactions.

(2) Amounts receivable from banks, deposits with banks, global credit card companies and organizations, revenue receivable, and other accounts receivables.

	As of December 31, 2024
	Private individuals		Commercial
	Receivables for credit cards	Credit(1)	Receivables for credit cards	Credit(1)	Other(2)	Total
In NIS million			Unaudited
Recorded outstanding debt:
Examined on a specific basis	4	23	70	606		‐ 703
Examined on a collective basis	4,602	10,408	243	464	2,428	18,145
Total debts	4,606	10,431	313	1,070	2,428	18,848
Of which:
Non-performing debts	13	145	3	25		‐ 186
Other troubled debts	6	357	2	35		400 ‐
Total troubled debts	19	502	5	60		‐ 586
Credit loss provision in respect of debts:
Examined on a specific basis	‐		1 ‐	19		‐ 20
Examined on a collective basis	11	295	2	41	4	353
Total credit loss provision	11	296	2	60	4	373
Of which: For non-performing debts	2	64	1	16		‐ 83
Of which: For other troubled debts	‐	35	‐		6	41 ‐

* Receivables for credit card transactions, deposits with banks, and other debts.

(1) Interest-bearing credit. This credit includes credit transactions, revolving credit card transactions, credit for card holders, credit non-card holders and other transactions.

(2) Amounts receivable from banks, deposits with banks, global credit card companies and organizations, revenue receivable, and other accounts receivables.

2. Credit quality by credit granting year

	As of March 31, 2025
	Recorded Recorded debt balance of fixed term credit
						debt of	outstanding renewed
	2025	2024	2023	2022		2021 Previous loans		Total
In NIS million				Unaudited
Private individuals
Receivables for credit cards:
Non-troubled credit	3,425	572	51	14	‐	‐	‐	4,062
Troubled accruing credit	2	3	1	‐	‐	‐	‐	6
Non-performing credit	4	9	‐	‐	‐	‐	‐	14
Total receivables for credit cards	3,431	584	53	14	1	‐	‐	4,082
Charge-offs during the reporting period	(11)	(6)	(1)	‐	‐	‐	‐	(18)
Credit:
Non-troubled credit	1,609	3,689	1,550	1,018	402	81	1,913	10,263
Troubled accruing credit	6	52	82	87	36	9	103	375
Non-performing credit	7	55	23	9	3	1	39	137
Total credit	1,622	3,796	1,655	1,114	441	91	2,055	10,775
Charge-offs during the reporting period	‐	(8)	(12)	(10)	(3)	(1)	(21)	(55)
Total private individuals	5,053	4,380	1,708	1,128	442	91	2,055	14,857
Commercial
Receivables for credit cards:
Non-troubled credit	312	25	5	1	‐	‐	‐	344
Troubled accruing credit	1	‐	‐	‐	‐	‐	‐	1
Non-performing credit	3	‐	‐	‐	‐	‐	‐	3
Total receivables for credit cards	316	25	5	1	‐	1	‐	348
Credit:
Non-troubled credit	375	334	197	67	21	5	80	1,080
Troubled accruing credit	12	7	‐	1	2	‐	4	35
Non-performing credit	1	10	12	1	‐	‐	2	26
Total credit	388	351	218	69	23	5	86	1,141
Charge-offs during the reporting period	‐	(1)	(1)	(1)	‐	‐	(1)	(4)
Commercial - total	704	376	223	70	23	6	86	1,489
Total debts	5,757	4,756	1,932	1,198	465	97	2,141	16,346

* Receivables for credit card transactions, deposits with banks, and other debts.

** As of March 31, 2025, there is no outstanding debt for renewed loans converted to fixed loans.

	March 31, 2024
				Recorded debt balance of fixed term credit			Recorded
						debt of	outstanding renewed
	2024	2023	2022	2021		2020 Previous loans		Total
In NIS million				Unaudited
Private individuals
Receivables for credit cards:
Non-troubled credit	3,352	536	69	12	1	-	‐	3,970
Troubled accruing credit	2	2	1	‐	‐	‐	‐	5
Non-performing credit	4	7	1	‐	‐	‐	‐	12
Total receivables for credit cards	3,358	545	71	12	1	-	‐	3,987
Charge-offs during the reporting period
Credit:
Non-troubled credit	1,335	2,849	1,798	788	209	69	1,801	8,848
Troubled accruing credit	6	55	106	51	17	6	87	328
Non-performing credit	18	50	17	6	2	1	44	138
Total credit	1,359	2,954	1,921	845	228	76	1,932	9,314
Charge-offs during the reporting period
Total private individuals	4,717	3,499	1,992	857	229	76	1,932	13,302
Commercial
Receivables for credit cards:
Non-troubled credit	226	24	2	‐	1	‐	‐	253
Troubled accruing credit	2	‐	‐	‐	‐	‐	‐	2
Non-performing credit	3	‐	‐	‐	‐	‐	‐	3
Total receivables for credit cards	231	24	2	‐	1	‐	‐	258
Charge-offs during the reporting period
Credit:
Non-troubled credit	305	347	164	52	29	3	68	968
Troubled accruing credit	12	9	7	3	2	‐	3	36
Non-performing credit	1	18	2	1	‐	1	1	24
Total credit	318	374	173	56	31	4	72	1,028
Charge-offs during the reporting period
Commercial - total	549	398	175	56	32	4	72	1,286
Total debts	5,266	3,897	2,167	913	261	80	2,004	14,588

* Receivables for credit card transactions, deposits with banks, and other debts.

** As of March 31, 2024, there is no outstanding debt for renewed loans converted to fixed loans.

	As of December 31, 2024
						debt of renewed	Recorded outstanding
	2024	2023	2022	2021		2020 Previous loans		Total
In NIS million				Unaudited
Private individuals
Receivables for credit cards:
Non-troubled credit	4,482	79	25	1	‐	‐	‐	4,587
Troubled accruing credit	4	1	1	‐	‐	‐	‐	6
Non-performing credit	12	1	‐	‐	‐	‐	‐	13
Total receivables for credit cards	4,498	81	26	1	‐	‐	‐	4,606
Charge-offs during the reporting period	(11)	(6)	(1)	‐	‐	‐	‐
Credit:
Non-troubled credit	4,459	1,781	1,181	479	100	13	1,916	9,929
Troubled accruing credit	36	77	93	39	10	1	101	357
Non-performing credit	56	23	12	3	1	1	49	145
Total credit	4,551	1,881	1,286	521	111	15	2,066	10,431
Charge-offs during the reporting period	(6)	(40)	(35)	(14)	(4)	(2)	(108)	(209)
Total private individuals	9,049	1,962	1,312	522	111	15	2,066	15,037
Commercial
Receivables for credit cards:
Non-troubled credit	297	5	1	‐	1	‐	‐	304
Troubled accruing credit	1	1	‐	‐	‐	‐	‐	2
Non-performing credit	3	‐	‐	‐	‐	‐	‐	3
Total receivables for credit cards	301	6	1	‐	1	‐	‐	309
Charge-offs during the reporting period	(1)	(1)	‐	‐	‐	‐	‐	(2)
Credit:
Non-troubled credit	598	224	79	27	8	‐	77	1,013
Troubled accruing credit	17	8	3	3	1	‐	3	35
Non-performing credit	9	12	1	‐	‐	‐	3	25
Total credit	624	244	83	30	9	‐	83	1,073
Charge-offs during the reporting period	(1)	(6)	(3)	(2)	‐	‐	‐	(12)
Commercial - total	925	250	84	30	10	‐	83	1,382
Total debts	9,974	2,212	1,396	552	121	15	2,149	16,419

* Receivables for credit card transactions, deposits with banks, and other debts.

** As of December 31, 2024, there is no outstanding debt for renewed loans converted to fixed loans.

C. Debts (1)

1. Credit quality and delinquency

	As of March 31, 2025
		Troubled (2)
			Non
	Performing	Accruing	accruing	Total
In NIS million	Unaudited
Private individuals
Receivables for credit cards	4,062		6	14	4,082
Credit (3)	10,263		375	137	10,775
Commercial
Receivables for credit cards	347		1	3	351
Credit (3)	1,077		35	26	1,138
Other accounts receivables (4)	2,532		‐	‐	2,532
Total debts	18,281		417	180	18,878

	As of March 31, 2024
		Troubled
			Non
	Performing	Accruing	accruing	Total
In NIS million	Unaudited
Private individuals
Receivables for credit cards	3,970		5	12	3,987
Credit (3)	8,848		328	138	9,314
Commercial
Receivables for credit cards	269		2	3	274
Credit (3)	952		36	24	1,012
Other accounts receivables (4)	2,265		‐	‐	2,265
Total debts	16,305		371	177	16,853

** Of which: debts with a credit rating as of the report date corresponding with the credit rating for new credit in accordance with the Company's policy in the amount of NIS 17,835 million (March 31, 2024 - NIS 15,975 million).

(1) Receivables for credit card transactions, deposits with banks, and other debts.

(2) Performing and non-performing debts.

(3) Including credit secured by vehicles amounting to NIS 3,638 million (March 31, 2024 - NIS 2,431 million).

(4) Amounts receivable from banks, deposits with banks, global credit card companies and organizations, revenue receivable, and other accounts receivables.

In NIS million	As of December 31, 2024

			Non
	Performing	Accruing	accruing	Total
	Unaudited
Private individuals
Receivables for credit cards	4,587		6	13	4,606
Credit (3)	9,929	357		145	10,431
Commercial
Receivables for credit cards	308		2	3	313
Credit (3)	1,010		35	25	1,070
Other accounts receivables (4)	2,428		‐	‐	2,428
Total debts	18,261	400		186	18,848

** Of which: debts with a credit rating as of the report date corresponding with the credit rating for new credit in accordance with the Company's policy in the amount of NIS 17,807 million.
(1) Receivables for credit card transactions, deposits with banks, and other debts.
(2) Accruing and non-accruing debts.
(3) Including credit secured by vehicles amounting to NIS 3,359 million.

(4) Amounts receivable from banks, deposits with banks, global credit card companies and organizations, revenue receivable, and other accounts receivables.

2. Additional information on non-performing debts

(a) Non-performing debts and provision

	As of March 31, 2025
			Outstanding debts
			Total	Outstanding
	Outstanding non		outstanding	contractual
	performing debts		non	principal in
	for which there Outstanding		performing	respect of non
	is a provision(2) provision		debts(2)	performing debts
In NIS million		Unaudited
Private individuals
Receivables for credit cards	14	2	14	14
Credit	137	59	137	137
Commercial
Receivables for credit cards	3	1	3	3
Credit	26	17	26	26
Total debts	180	79	180	180

			As of March 31, 2024
	Outstanding debts
			Total	Outstanding
	Outstanding non		outstanding	contractual
	performing debts		non	principal in
	for which there Outstanding		performing	respect of non
	is a provision(2) provision		debts(2)	performing debts
In NIS million		Unaudited
Private individuals
Receivables for credit cards	12	2	12	12
Credit	138	54	138	138
Commercial
Receivables for credit cards	3	1	3	3
Credit	24	14	24	24
Total debts	177	71	177	177

(1) Receivables for credit card transactions, deposits with banks, and other debts.

(2) Recorded outstanding debt

(3) Amounts receivable from banks, deposits with banks, global credit card companies and organizations, accrued income, and other accounts receivables.

			As of December 31, 2024
	Outstanding debts
	Outstanding non performing debts for which there Outstanding is a provision(2) provision		Total outstanding non performing debts(2)	Outstanding contractual principal in respect of non performing debts
In NIS million	Unaudited
Private individuals
Receivables for credit cards	13	2	13	13
Credit	145	64	145	145
Commercial
Receivables for credit cards	3	1	3	3
Credit	25	16	25	25
Total debts	186	83	186	186

(1) Receivables for credit card transactions, deposits with banks, and other debts.

(2) Recorded outstanding debt.

Information regarding debts of financially distressed borrowers who underwent a change in terms and conditions (2)

A. The credit quality and extent of arrears of debts of financially distressed borrowers who underwent a change in terms and conditions (2)

	As of March 31, 2025
	Recorded outstanding debt
	Non-performing
	interest revenues Total
In NIS million	Unaudited
Private individuals
Receivables for credit cards	6 6
Credit	56 56
Commercial
Credit	8 8
Total debts	70 70

	As of March 31, 2024
	Recorded outstanding debt Non-performing

	interest revenues Total
In NIS million	Unaudited
Private individuals
Receivables for credit cards	4 4
Credit	50 50
Commercial
Credit	14 14
Total debts	68 68

(1) Receivables for credit card transactions, deposits with banks, and other debts.

	As of December 31, 2024
	Recorded outstanding debt
	Non-performing
	interest revenues Total Unaudited
In NIS million
Private individuals
Receivables for credit cards	5 5
Credit	54 54
Commercial
Credit	10 10
Total debts	69 69

(1) Receivables for credit card transactions, deposits with banks, and other debts.

B. The credit quality and extent of arrears of debts of financially distressed borrowers who underwent a change in terms and conditions during the reporting period (2)

	For the three-month period ended March 31, 2025
	Recorded outstanding debt
	Troubled non
	performing	Total
In NIS million	Unaudited
Private individuals
Receivables for credit cards		1	1
Credit		17	17
Commercial
Credit		1	1
Total debts		19	19

	ended March 31, 2024	For the three-month period
	Recorded outstanding debt
	Troubled non
	performing Total
In NIS million	Unaudited
Debts not guaranteed by banks
Private individuals
Receivables for credit cards	1	1
Credit	19	19
Commercial
Credit	9	9
Total debts	68	68

(1) Receivables for credit card transactions, deposits with banks, and other debts.

C. Debts of distressed borrowers who underwent changes of terms during the reporting period

Debts of distressed borrowers who underwent changes of terms during the three-month period ended March 31, 2025

	Total		Type of change
	Recorded outstanding debt	% of total	Waiver of interest	Extension of period	Extension of period and waiver of interest
NIS million		Unaudited
Private individuals
Receivables for credit cards	1		‐	‐	1 ‐
Credit	17		‐	1	11 5
Commercial
Credit	1		‐	‐	1 ‐
Total debts	19		‐	1	13 5

			Financial effects of the change in terms and conditions during the three-month period ended March 31, 2025 Type of change		Total	Debts of distressed borrowers changes of terms during the	March 31, 2025 (2) Type of change	who defaulted following three-month period ended
	Average waiver of interest		Average extension of period	Average payment deferral	Recorded outstanding debt	Waiver of interest		Extension of period
		%	Months		Unaudited	NIS million
Private individuals
Receivables for credit cards			32		‐	‐	‐		‐
Credit		2	32		‐	4	1		3
Commercial
Credit		2	20		‐	‐	‐		‐
Total debts		2	32		‐	4	1		3

(1) Receivables for credit card transactions, deposits with banks, and other debts.

(2) Debts that defaulted during the Reporting Period after they underwent a change in terms and conditions of debts of financially distressed borrowers during the 12 months prior to the date on which they defaulted.

NOTE 11 - PAYABLES FOR CREDIT CARD TRANSACTIONS

			As of
	As of March 31		December 31
	2025	2024	2024
In NIS million	Unaudited
Merchants (1)	8,592	8,166	8,421
Liabilities for deposits (2)	240	177	209
Credit card companies	912	549	888
Prepaid income	30	24	29
Benefit plan for card holders (3)	95	78	90
Other (4)	64	80	70
Total payables for credit card transactions	9,933	9,074	9,707

1. Net of balances for factoring credit card vouchers for merchants in the amount of NIS 1,614 million (December 31, 2024 - NIS 1,708 million, March 31, 2024 - NIS 1,586 million) and for early payments to merchants in the amount of NIS 265 million (December 31, 2024 - NIS 244 million, March 31, 2024 - NIS 143 million). These balances do not constitute a credit transaction but rather a settlement of an obligation, in accordance with the accounting policies note in Section D8 to the Annual Financial Statements.
1. All of Max's deposits were raised in Israel and do not bear interest. In addition, all the deposits are held for private individuals and do not exceed NIS 1 million.
1. As part of the operation of Max's customer loyalty programs, there is a liability towards card holders for their right to benefits according to the terms and conditions of the plans. The balance of the liability includes a provision based on the calculation of the expected future utilization rate of the benefits by the card holders.
1. Mainly accrued expenses in respect of banks and loyalty programs.

	For the three-month period ended March 31		For the year ended December 31
	2025	2024	2024
In NIS million	Unaudited
Revenues from merchants
Merchants fees and commissions	210	191	809
Other revenues	49	44	179
Total revenues from merchants - gross	259	235	988
Net of fees and commissions to other issuers	(98)	(89)	(380)
Total revenues from merchants - net	161	146	608
Income from credit card holders
Issuer fees and commissions	149	127	566
Service fees and commissions	54	47	208
Fees and commissions from cross-border transactions	45	34	172
Total revenues for credit card holders	248	208	946
Total revenues from credit card transactions	409	354	1,554

NOTE 12 - REVENUES FROM CREDIT CARD TRANSACTIONS

(1) Revenues from issuer fees include an interchange fee in respect of transactions involving Israeli merchants and transactions involving overseas merchants.

(2) Service fees include fees collected from the Company's card holders in accordance with the fees and commissions price list, and processing fees collected from the banks with which the Company has processing agreements.
(3) Revenues from overseas transaction fees include foreign exchange fee in respect of transactions involving overseas merchants (with card present and card not present).

NOTE 13 - ADDITIONAL EVENTS DURING AND SUBSEQUENT TO THE REPORTING PERIOD

A. Economic solvency ratio in Clal Insurance

On May 28, 2025, Clal Insurance approved its Economic Solvency Ratio Report as of December 31, 2024. For further details, see Note 7 above.

B. Share-based payment

On May 8, 2025, the Company's board of directors resolved to publish an outline for the allocation of up to 130,000 Class A options and 470,000 Class B option to be offered under the outline, based on the Plan for 2021, for employees and officers of the Company and/or companies under its control. Allocation of the options to be offered under the outline is subject to obtaining all of the permits and approvals required under any law for the offering of securities in accordance with the outline, for their issue, and for the publication of the outline. The shares underlying the exercise of these options will represent approx. 0.27% of the Company's equity capital as of the reporting date, assuming maximum exercise. The option warrants will be exercisable for ordinary shares of the Company at the value of the inherent benefit of the options, subject to adjustments. The value of the benefit is based on the valuation of the options at the time they are allotted, which is approx. 30.08 per option, and the fair value of each tranche will be spread over the vesting period. The value of the benefit was calculated using the binomial model, and estimated at approx. NIS 15 million for all options, which will be awarded to Group officers and employees as stated above. The Class A options will be allocated in three tranches, spread over three years, and shall be exercisable beginning when one year, two years, and 3 years have elapsed from the allocation date, up to two years from the vesting/ holding date. (With respect to the first tranche, at least two years of vesting and holding are required).

C. Agreement with the National Insurance Institute regarding compensation under the National Insurance Law in respect of national insurance annuities in road accidents in which an insurer is required to pay compensation in respect of 2016-2022

According to the National Insurance Law [Combined Version], 1995 (hereinafter - the "National Insurance Law"), where the National Insurance Institute paid an annuity to a person entitled to an annuity, and at the same time a liability arises to a third-party to pay compensation to that person under the Tort Ordinance or the CRAV Law, the National Insurance Institute may claim compensation from the said third party in respect of annuity it has paid or is required to pay (hereinafter - the "Third Party"). The Third Party may deduct from the compensation the annuities paid and/or due to be paid by the National Insurance Institute. Over the years, the National Insurance Institute used to file individual subrogation claims with insurers.

The Economic Efficiency Law (Legislative Amendments to Achieve the Budgetary Targets for Budget Years 2021 and 2022), 2021 amended the National Insurance Law, such that as from January 2023 the netting mechanism due to claims arising from road accidents was modified to replace the filing of individual subrogation claims by the National Insurance Institute.

In July 2024, an agreement was signed between Clal Insurance and the National Insurance Institute, which prescribes Clal Insurance's exposure to subrogation claims by the National Insurance Institute in the Compulsory Motor Subsegment in respect of 2016-2022 was essentially extinguished.

D. Shelf prospectus

Subsequent to the reporting date, on April 8, 2025, Clal Insurance Capital Raising Ltd. (hereinafter - "Clal Capital Raising") published a shelf prospectus dated April 9, 2025 (hereinafter - the "Shelf Prospectus"). The Shelf Prospectus allows Clal Capital Raising, among other things, to issue bonds and options for bonds. Generally, the consideration for bonds issued by Clal Capital Raising by virtue of the Shelf Prospectus, will be deposited with the Company and recognized as Tier 2 capital (subject to restrictions on the maximum rate of Tier 2 capital, in accordance with the provisions of the law), and the Company will be liable to the holders of the bonds for their repayment.

E. Debt raising by Clal Insurance Capital Raising Ltd. a subsidiary of Clal Insurance

Subsequent to the reporting date, in April 2025, Clal Capital Raising issued to the public Bonds (Series N) totaling NIS 500 million (hereinafter - the "Bonds"), by virtue of the shelf prospectus. The principal will be repaid in one lump sum on September 30, 2039, unless Clal Capital Raising exercises its right to execute early redemption of the bonds. The principal and interest are not non-linked. The interest payable on the Bonds (Series N) is paid annually in two semiannual installments starting on September 30, 2025, and on March 31 and September 30 of each calendar year between 2026 and 2039. The annual nominal interest rate is 5.51% and the annual effective interest rate is 5.72% assuming redemption on the Effective Date for Additional Interest. The issuance costs amounted to approx. NIS 5,820 thousand. For further details, see Note 5(f) above.

F. Debt raising by Max and its becoming a reporting corporation

As part of Max's financing strategy, on April 7, 2025, Max published a supplementary prospectus and a shelf prospectus dated April 8, 2025, and on April 24, 2025, it completed a NIS 207 million raising of Commercial Papers (Series 5) from institutional investors and - for the first time - also from the public. As from this date, Max became a reporting corporation, as defined by the Securities Law, 1968. Max's becoming a reporting corporation constitutes a part of its financing strategy as a growing company, and it allows Max to diversify its sources of financing for its operating activities.

G. Effect of the Iron Swords War

Further to Note 46(m) to the 2024 Consolidated Financial Statements, 2025 started with ceasefire agreements on the northern front and the Gaza Strip front, which led to a relative calm. In March 2025, the temporary ceasefire between Israel and Hamas ended and the IDF resumed fighting in the Gaza Strip. This move led to increased tensions at the national and security levels, including, among other things, the resumption of missile attacks on Israel by the Houthis in Yemen. As of the report approval date, foreign airlines announced once again the cancellation of their flights to Israel.

Israel's credit rating

As of the approval date of the financial statements, the State of Israel's credit rating remains stable, but with a negative outlook, in accordance with the assessments of the three main rating agencies:

Effect on the financial statements

Clal Insurance - In the reporting period, and as of the approval date of these financial statements no material changes occurred in connection with the effects of the War on Clal Insurance's financial results.

Max - in the Reporting Period, the growth trend in Max's issuance turnovers in Israel and overseas and in its acquiring turnovers continued; those turnovers exceeded turnovers in the corresponding period last year. This is further to the gradual growth in 2024, after the decline in the first months of the War. Looking ahead, it may be assumed that the deterioration in the security situation and the intensification of fighting in the south and in the north may affect businesses and residents, and consequently they may continue to affect economic activity, which is reflected in Max's business activities.

The estimated provision for credit losses is based on judgments and assessments, and still involves substantial uncertainty at this stage. Further to Note 46(m) to the 2024 Consolidated Financial Statements, in 2023 Max increased the provision for current expected credit losses based on estimates of the potential increase in the credit risk of Max's customers. So far, and during the Reporting Period, there has not been a noticeable increase in the credit risk or actual credit losses of Max's customers due to the War. However, in light of the difficulty of estimating the duration and scope of the War and its potential effect on economic activity across the country, as well as the extent of the potential damage to the repayment capacity of Max's private and business customers, on the one hand, and the mitigating effects of aid programs and other reliefs, on the other hand, the estimated provision for credit losses is based on judgment and assessments, and involves significant uncertainty at this stage. Accordingly, it is highly likely that future credit losses may be substantially higher or lower than the current estimate.

H. Dividend distribution by the Company

Subsequent to the reporting date, on May 28, 2025, the Company's Board approved a dividend distribution totaling approx. NIS 200 million, which constitutes approx. 64% of the dividends declared and/or distributed in the Company's subsidiaries as of the approval date of the Consolidated Interim Financial Statements. (See Note 6(b) above).

I. Material effects on the Financial Statements

In the reporting periods, the development of the contractual service margin is mainly affected by accrual of interest, recognition of new businesses, recognition of revenues from insurance services for the current period, and revisions to future cash flow forecasts, due to, among other things, demographic, operational and financial assumptions. In the reporting period, which ended on March 31, 2025, the Company's retention contractual service margin increased mainly as a result of financial effects. In the period ended March 31, 2024, the Company's retention contractual service margin did not change materially. In the year ended December 31, 2024, the Company's retention contractual service margin increased due to the first-time application of the stochastic model for assessment of variable management fees and due to financial effects of approx. NIS 1,750 million, which was partially offset by revisions of approx. NIS 320 million to demographic and operational assumptions.

Furthermore, the effect of the changes in the risk-free interest rate curve and the illiquidity premium on insurance contract liabilities and reinsurance contract assets net of the effect of the designated bonds recognized in the statement of comprehensive income is an income of approx. NIS 160 million for the reporting period, which ended March 31, 2025, a loss of approx. NIS 210 million for the period ended March 31, 2024, and a loss of approx. NIS 350 million for the year ended December 31, 2024.

Note 14 - EFFECT OF FIRST-TIME ADOPTION OF IFRS 17 AND IFRS 9 BY A SUBSIDIARY WHICH MEETS THE DEFINITION OF AN INSURER IN ACCORDANCE WITH SECURITIES REGULATIONS (PREPARATION OF ANNUAL FINANCIAL STATEMENTS), 2010

In accordance with the Commissioner's guidance published in a series of documents, the latest of which was named "Roadmap for the Adoption of IFRS 17 – Insurance Contracts - Fifth Revision" (hereinafter - the "Roadmap"), the firsttime application date of IFRS 17 and IFRS 9 (hereinafter - the "New Standards") for insurance companies in Israel (whose binding application date by the abovementioned companies in accordance with IFRS was supposed to be January 1, 2023) was revised, such that they apply to quarterly and annual periods commencing on January 1, 2025. The transition date for the application of the New Standards is January 1, 2024.

Due to the above, from January 1, 2023 to January 1, 2025, insurance companies in Israel continued to apply the provisions of IFRS 4 – "Insurance Contracts" and IAS 39 – "Financial Instruments: Recognition and Measurement", which they applied through that date, and which were superseded by the New Standards. All other IFRS were applied by the insurance companies in accordance with the dates set therein.

Consequently, throughout the period from January 1, 2023 to January 1, 2025 (hereinafter - the "Interim Period"), the Group's Consolidated Financial Statements with respect to a subsidiary, which meets the definition of insurer, did not fully comply with IFRS; rather, they were prepared pursuant to the Financial Services Supervision Law (Insurance), in accordance with the Commissioner's Directives.

In view of the above, in accordance with the provisions of IFRS 1 – "First-time Adoption of International Financial Reporting Standards" (hereinafter - "IFRS 1") and with respect to a subsidiary which meets the definition of an insurer, the Group is effectively deemed a first-time adopter of IFRS, as defined in IFRS 1; accordingly, with respect to a subsidiary which meets the definition of insurer, as defined in IFRS 1, the Group's 2025 Annual Financial Statements will be its first financial statements compliant with IFRS, and the abovementioned transition date for application of the New Standards (January 1, 2024) also constitutes the Group's transition date to IFRS reporting as defined in IFRS 1.

The Group's Condensed Consolidated Interim Financial Statements as of March 31, 2025 and for the 3-month period ended on that date (hereinafter - the "Interim Financial Statements") were prepared in accordance with IAS 34 – "Interim Financial Reporting" (hereinafter - "IAS 34"). The said Interim Financial Statements are the first interim financial statements prepared by the Group for part of the period included in its first IFRS-compliant financial statements, and IFRS 1 was also applied as part of their preparation.

However, since during the Interim Period - except for non-application of the New Standards - the Group continued to apply all other IFRS in accordance with the dates set therein - with respect to a subsidiary which meets the definition of an insurer - the effect of the first-time adoption of IFRS under the application of IFRS 1 to the Group's financial statements focuses on the application of the abovementioned relevant provisions and expedients under IFRS 1 regarding the firsttime application of the New Standards. With respect to IFRS other than the New Standards - the Group's accounting policies as applies in these Interim Financial Statements are consistent with those applied under the Group's 2024 Annual Financial Statements.

It is noted that with respect to the Group's financial statements - in connection with a subsidiary which meets the definition of an insurer - the relevant provisions and expedients under IFRS 1 regarding the first-time application of the New Standards, are not materially different from the transitional provisions detailed in the New Standards themselves, and which the Company detailed in this note.

In accordance with the provisions of IFRS 1, following are explanations as to how the transition from reporting in accordance with the Supervision Law in accordance with the Commissioner's Directives to reporting in accordance with IFRS affected the financial position and financial performance reported by the Group, in connection with a subsidiary which meets the definition of insurer.

The said transition did not affect the cash flows reported by the Group.

A. Quantitative breakdowns

The following is a quantitative breakdown of the material adjustments to the Group's capital and comprehensive income due to the initial application of IFRS. Due to the changes in the structure of the statement of financial position included in the financial statements prepared in accordance with IFRS 17 compared to the current financial statements, which are prepared in accordance with IFRS 4, the balance sheet items of the financial statements as of December 31, 2023, as reported, were classified into the most appropriate balance sheet items in accordance with the revised format, which complies with IFRS 17.

1) Effect on the statement of financial position and capital:

	As of December 31, 2023 as previously reported	Effect of first-time application of IFRS 17 and IFRS 9	Pro forma balance sheet as of the transition date January 1, 2024
Audited		NIS million
Assets
Cash and cash equivalents in respect of yield-dependent contracts	4,418	-	4,418
Other cash and cash equivalents	2,548	-	2,548
Financial investments in respect of yield-dependent contracts measured	84,133	-	84,133
at fair value
Other financial investments measured at fair value	14,821	26,241	41,062
Other financial investments measured at depreciated cost	24,444	(22,107)	2,337
Receivables and debit balances	1,867	(41)	1,826
Collectible premium	837	(837)	-
Current tax assets	306	-	306
Insurance contract assets (2)	-	2,059	2,059
Reinsurance contract assets (2)	3,805	(1,272)	2,533
Equity-accounted investments	180	-	180
Investment property in respect of yield-dependent contracts	3,839	-	3,839
Investment property - other	1,494	-	1,494
Receivables for credit cards, net	15,092	-	15,092
Other property, plant and equipment	302	-	302
Intangible assets and goodwill	2,205	-	2,205
Costs of obtaining investment management service contracts	706	-	706
Deferred acquisition costs	1,837	(1,837)	-
Deferred tax assets	104	114	218
Right-of-use assets	680	-	680
Total assets	163,617	2,320	165,938
Total assets for yield-dependent contracts	94,012	-	94,012
Liabilities
Loans and credit	13,917	(5)	13,912
Liabilities for derivative instruments	1,782	-	1,782
Payables and credit balances	3,851	(2,151)	1,700
Liability for current taxes	21	-	21
Liabilities for yield-dependent investment contracts	9,975	3,176	13,151
Liabilities in respect of non-yield-dependent investment contracts (1)
Liabilities for insurance contracts (2)	2,563	(93)	2,470
	113,304	3,171	116,475
Labilities in respect of reinsurance contracts	-	68	68
Liabilities for employee benefits, net	93	-	93
Liabilities in respect of deferred taxes	592	(556)	36
Payables for credit card transactions, net	8,091	-	8,091
Lease liabilities	777	-	777
Total liabilities	154,966	3,610	158,576
Equity
Share capital	167	-	167
Share premium	2,390	-	2,390
Capital reserves	1,005	(866)	139
Surplus	5,019	(426)	4,593
Total equity attributable to Company's shareholders	8,581	(1,292)	7,289
Non-controlling interests	71	2	73
Total equity	8,652	(1,290)	7,362
Total current liabilities and equity	163,617	2,320	165,938

(1) This line item also includes liabilities in respect of contracts for the management of guaranteed return provident funds.

(2) Following are further details:

	Life Insurance
	and Long	Health	P&C
	Term Savings	Insurance	Insurance Total
Contractual service margin (CSM)
Contractual service margin (CSM), gross *	4,874	4,266		- 9,140
Contractual service margin (CSM), reinsurance **	137	190		- 327
Contractual service margin (CSM), net	4,737	4,076		- 8,813
Risk adjustment (RA)
Risk adjustment (RA), gross	976	1,314	205	2,495
Risk adjustment (RA), reinsurance	83	117	91	291
Risk adjustment, net	893	1,197	114	2,204

* Of the contractual service margin in the Life Insurance and Savings Segment, approx. 51% is attributed to a portfolio of policies, which include a yield-dependent savings component and variable management fees, approx. 12% is attributed to a portfolio of policies, which include a yield-dependent savings component and fixed management fees, approx. 18% is attributed to an insurance portfolio covering death risk, and approx. 17% is attributed to a portfolio of policies, which include a savings component which is not yield-dependent. Of the contractual service margin in the Health Insurance Segment, approx. 40% is attributed to an individual long-term care portfolio, approx. 27% is attributed to an individual medical expenses portfolio and approx. 29% is attributed to a critical illness portfolio.

** Of the contractual service margin in the Life Insurance and Savings Segment, approx. 72% is attributed to a permanent health insurance portfolio and approx. 24% is attributed to an insurance portfolio covering death risk. Of the contractual service margin in the Health Insurance Segment, approx. 64% is attributed to a long-term care portfolio and approx. 29% is attributed to a critical illness portfolio.

	As of March 31, 2024, as previously reported	Effect of first time application of IFRS 17 and IFRS 9	Pro forma balance sheet March 2024
Unaudited		NIS million
Assets
Cash and cash equivalents in respect of yield-dependent contracts	5,025	-	5,025
Other cash and cash equivalents	2,233	-	2,233
Financial investments in respect of yield-dependent contracts measured	85,489	-	85,489
at fair value
Other financial investments measured at fair value	13,929	26,819	40,748
Other financial investments measured at depreciated cost	24,841	(22,508)	2,333
Receivables and debit balances	1,025	(72)	953
Collectible premium	883	(883)	-
Current tax assets	144	-	144
Insurance contract assets (2)	-	2,187	2,187
Reinsurance contract assets (2)	3,877	(1,296)	2,582
Equity-accounted investments	182	-	182
Investment property in respect of yield-dependent contracts	3,852	-	3,852
Investment property - other	1,501	-	1,501
Receivables for credit cards, net	15,891	-	15,891
Other property, plant and equipment	307	-	307
Intangible assets and goodwill	2,206	-	2,206
Costs of obtaining investment management service contracts	713	-	713
Deferred acquisition costs	1,859	(1,859)	-
Deferred tax assets	137	-	137
Right-of-use assets	672	-	672
Total assets	164,765	2,389	167,154
Total assets for yield-dependent contracts	95,249	(551)	94,698
Liabilities
Loans and credit	12,287	(7)	12,280
Liabilities for derivative instruments	703	-	703
Payables and credit balances	3,938	(2,092)	1,846
Liability for current taxes	68	-	68
Liabilities for yield-dependent investment contracts	9,734	3,298	13,032
Liabilities in respect of non-yield-dependent investment contracts (1)	2,476	-	2,476
Liabilities for insurance contracts (2)	116,144	2,880	119,024
Labilities for reinsurance contracts	-	68	68
Liabilities for employee benefits, net	92	-	92
Liabilities in respect of deferred taxes	664	(618)	45
Payables for credit card transactions, net	9,074	-	9,074
Lease liabilities	769	-	769
Total liabilities	155,948	3,528	159,476
Equity
Share capital	167	-	167
Share premium	2,394	-	2,394
Capital reserves	1,128	(988)	140
Surplus	5,056	(154)	4,902
Total equity attributable to Company's shareholders	8,745	(1,142)	7,603
Non-controlling interests	72	3	75
Total equity	8,817	(1,139)	7,678
Total current liabilities and equity	164,765	2,389	167,154

(1) This line item also includes liabilities in respect of contracts for the management of guaranteed return provident funds.

(2) Following are further details:

	Life Insurance and
	Long-Term		Health	P&C
	Savings		Insurance	Insurance Total
Contractual service margin (CSM)
Contractual service margin (CSM), gross *		4,866	4,240		-	9,106
Contractual service margin (CSM), reinsurance **		116	189		-	305
Contractual service margin (CSM), net		4,750	4,051		-	8,801
Risk adjustment (RA)
Risk adjustment (RA), gross		986	1,340	206		2,532
Risk adjustment (RA), reinsurance		80	120	89		289
Risk adjustment, net		906	1,220	117		2,243

* Of the contractual service margin in the Life Insurance and Savings Segment, approx. 52% is attributed to a portfolio of policies, which include a yield-dependent savings component and variable management fees, approx. 11% is attributed to a portfolio of policies, which include a yield-dependent savings component and fixed management fees, approx. 17% is attributed to an insurance portfolio covering death risk, and approx. 16% is attributed to a portfolio of policies, which include a savings component which is not yield-dependent. Of the contractual service margin in the Health Insurance Segment, approx. 39% is attributed to an individual long-term care portfolio, approx. 28% is attributed to an individual medical expenses portfolio and approx. 29% is attributed to a critical illness portfolio.

** Of the contractual service margin in the Life Insurance and Savings Segment, approx. 70% is attributed to a permanent health insurance portfolio and approx. 26% is attributed to an insurance portfolio covering death risk. Of the contractual service margin in the Health Insurance Segment, approx. 64% is attributed to a long-term care portfolio and approx. 30% is attributed to a critical illness portfolio.

	As of December 31, 2024 as previously reported	Effect of first time application of IFRS 17 and IFRS 9	Pro forma balance sheet December 2024
Unaudited		NIS million
Assets
Cash and cash equivalents in respect of yield-dependent contracts	4,451	-	4,451
Other cash and cash equivalents	2,617	-	2,617
Financial investments in respect of yield-dependent contracts measured	88,802	-	88,802
at fair value
Other financial investments measured at fair value	14,010	27,169	41,179
Other financial investments measured at depreciated cost	25,371	(23,031)	2,340
Receivables and debit balances	724	(82)	642
Collectible premium	795	(795)	-
Current tax assets	60	-	60
Insurance contract assets (2)	-	2,653	2,653
Reinsurance contract assets (2)	3,830	(1,166)	2,664
Equity-accounted investments	190	-	190
Investment property in respect of yield-dependent contracts	3,924	-	3,924
Investment property - other	1,517	-	1,517
Receivables for credit cards, net	17,855	-	17,855
Other property, plant and equipment	310	-	310
Intangible assets and goodwill	2,212	-	2,212
Costs of obtaining investment management service contracts	764	-	764
Deferred acquisition costs	1,837	(1,837)	-
Deferred tax assets	159	-	159
Right-of-use assets	669	-	669
Total assets	170,097	2,911	173,008
Total assets for yield-dependent contracts	97,983	(654)	97,329
Liabilities
Loans and credit	14,143	(5)	14,138
Liabilities for derivative instruments	528	-	528
Payables and credit balances	3,932	(2,192)	1,739
Liability for current taxes	18	-	18
Liabilities for yield-dependent investment contracts	9,127	3,410	12,537
Liabilities in respect of non-yield-dependent investment contracts (1)	2,522	-	2,522
Liabilities for insurance contracts (2)	118,988	2,730	121,718
Labilities in respect of reinsurance contracts	-	62	62
Liabilities for employee benefits, net	89	-	89
Liabilities in respect of deferred taxes	742	(387)	355
Payables for credit card transactions, net	9,707	-	9,707
Lease liabilities	775	-	775
Total liabilities	160,571	3,617	164,189
Equity
Share capital	167	-	167
Share premium	2,423	-	2,423
Capital reserves	1,242	(1,104)	138
Surplus	5,618	396	6,014
Total equity attributable to Company's shareholders	9,450	(708)	8,742

Non-controlling interests	75	1	76
Total equity	9,525	(707)	8,818
Total current liabilities and equity	170,097	2,911	173,008

(1) This line item also includes liabilities in respect of contracts for the management of guaranteed return provident funds.

(2) Following are further details:

	Life Insurance
	and Long	Health	P&C
	Term Savings	Insurance	Insurance Total
Contractual service margin (CSM)
Contractual service margin (CSM), gross *	5,602	4,863		- 10,465
Contractual service margin (CSM), reinsurance **	119	198		- 317
Contractual service margin (CSM), net	5,483	4,665		- 10,148
Risk adjustment (RA)
Risk adjustment (RA), gross	937	1,429	196	2,562
Risk adjustment (RA), reinsurance	73	144	83	300
Risk adjustment, net	864	1,285	113	2,262

* Of the contractual service margin in the Life Insurance and Savings Segment, approx. 68% is attributed to a portfolio of policies, which include a yield-dependent savings component and variable management fees, approx. 14% is attributed to an insurance portfolio covering death risk, and approx. 13% is attributed to a portfolio of policies, which include a savings component which is not yield-dependent. Of the contractual service margin in the Health Insurance Segment, approx. 35% is attributed to an individual long-term care portfolio, approx. 27% is attributed to an individual medical expenses portfolio and approx. 34% is attributed to a critical illness portfolio.

** Of the contractual service margin in the Life Insurance and Savings Segment, approx. 78% is attributed to a permanent health insurance portfolio and approx. 22% is attributed to an insurance portfolio covering death risk. Of the contractual service margin in the Health Insurance Segment, approx. 54% is attributed to the long-term care portfolio and the rest is attributed mainly to the critical illness portfolio.

The main changes in the statement of financial position arise from the following:

Other financial investments measured at fair value have increased following the classification of most of the Company's financial assets to fair value through profit or loss, in particular designated bonds, due to the application of IFRS 9 instead of measurement at amortized cost.
Other financial investments measured at amortized cost decreased following the classification of most of the Company's financial assets to fair value through profit or loss.
The change in receivables and debit balances and payables and credit balances arises mainly from the classification of balances with policyholders or reinsurers, including deposits with respect to reinsurers, which are included in the fulfilment cash flows under IFRS 17; therefore, they were classified to insurance contract liabilities and reinsurance contract assets, as applicable.
The remaining collectible premium is included under IFRS 17 in the fulfillment cash flows; therefore, it was classified into insurance contract liabilities.
Deferred acquisition expenses attributable to long-term policies in the Life and Health Insurance Segments, for which the Company applied the fair value approach or the retrospective application approach in its transition to IFRS 17, were derecognized on the transition date against a decrease in retained earnings. It is noted that deferred acquisition expenses, which are not attributable to contract renewals outside the contract boundary, and to futures, are recognized under insurance contract liabilities against a decrease in the remaining contractual service margin (CSM), rather than as a separate asset. The balance of deferred acquisition expenses presented after the application of IFRS 17 is attributed to investment contracts, pension funds and provident funds only, and presented as costs of obtaining investment management service contracts.
The change in insurance contract liabilities and reinsurance contract assets arises mainly from the application of the provisions of IFRS 17, which are mainly based on fulfillment cash flows discounted using current assumptions and estimates, and recognition of the contractual service margin (CSM), which represents the unearned profit.
The balance of the capital reserve in respect of available-for-sale financial assets was reclassified to retained earnings on the transition date. Upon application of IFRS 9, available-for-sale financial assets are measured at fair value through profit or loss.

The change in the Group's equity as of the transition date (January 1, 2024) following the application of the New Standards arises mainly from the following:

NIS million	(Audited)
Shareholders' equity as of December 31, 2023 - as previously reported	8,652
Revision to the measurement of insurance contract liabilities and reinsurance contract assets in accordance with the provisions of IFRS 17	(4,262)
Derecognition of deferred acquisition expense assets in long-term policies in the Life and Health Insurance Segments	(1,837)
Transition to measurement of financial assets, including designated bonds, from measurement at cost or amortized cost	4,134
to measurement at fair value
Other effects	5
Recognition of deferred taxes in respect of the tax effects arising from the abovementioned changes (*)	670
Equity as of January 1, 2024 – in accordance with IFRS	7,362

(*) As to the tax effect, it is noted that the transition date for income tax purposes will be January 1, 2025, and that the full effect of the decrease in equity, after taking into account the 2024 results will be recognized as a loss carried forward or as a current loss in subsequent periods, both for the purpose of corporate income tax, and for the purpose of profit tax, which applies to the insurance companies of the Group, which is a financial institution. As of the report publication date, the tax treatment following the implementation of the standards in the insurance companies' financial statements has not yet been determined. The Company believes that the tax treatment is not expected to have a material effect on the results following the New Standards. It is noted that the Israel Insurance Association and the Israel Tax Authority have in place sectoral agreements, which are renewed and revised every year and address tax issues unique to the industry. For further details, see Note 24(a)2 to the Consolidated Financial Statements for 2024.

1) Insurance contracts

The Group has applied the transition approaches allowed under IFRS 17 as detailed below:

IFRS 17 should be applied retrospectively (hereinafter - "Full Retrospective Application"), unless this is impractical.

In applying the Full Retrospective Application, the Company shall identify, recognize and measure each group of insurance contracts as if IFRS 17 had always been applied. Furthermore, the Company shall derecognize any existing balances, which would not exist had IFRS 17 always been applied. Any resulting net difference will be recognized in equity.

The transition date is January 1, 2024, such that upon initial application the Company restated the comparative figures for 2024.

If Full Retrospective Application for a group of insurance contracts is impractical, the Company may opt to apply one of the following approaches separately for each insurance portfolio:

a) The modified retrospective approach to achieve the closest outcome to Full Retrospective Application possible using reasonable and supportable information available without undue cost or effort; or
b) The fair value approach in this approach the Company shall determine the contractual service margin or loss component of the liability for remaining coverage at the transition date as the difference between the fair value of a group of insurance contracts at that date and the fulfilment cash flows measured at that date. It is noted that the Professional Issues Circular includes the regulation of various aspects of the calculation of the fair value of the insurance portfolios on transition date, where an insurance company applies the fair value approach.

The Company opted to implement the retrospective application approach for the property and casualty insurance portfolios and travel policies.

The Company is of the opinion that it is impractical to apply IFRS 17 retrospectively to groups of life and health insurance contracts, except for overseas travel, for the following reasons;

a) The effects of Full Retrospective Application cannot be determined since the required information (such as aggregation of contracts into portfolios, setting profitability levels, etc.) has not been collected or is not available without investing excessive costs or efforts, and the application of the new IT and reporting systems to historical data will require unreasonable efforts.
b) The retrospective application approach requires assumptions regarding Company management's intentions in previous periods or material accounting estimates, which cannot be made without using hindsight (for example,

assumptions regarding illiquidity rates, adjustment for non-financial risk (RA), including its diversification or allocation for previous periods where these assumptions were not required by the Company, etc.).

The Company applied the modified retrospective approach to the critical illness portfolios and the portfolios of life insurance contracts sold in the 2020-2023 underwriting years; it also intends to apply the fair value approach to all other portfolios.

Reliefs when applying the modified retrospective approach -

The Company has implemented the following permitted adjustments for the purpose of determining the CSM on the initial recognition date:

a) The future cash flows of each group of insurance contracts are estimated on the initial recognition date as the amount of the future cash flows on the Group's transition date, adjusted to reflect the cash flows already known to have occurred between the initial recognition date of the said group and the transition date (including with respect to the cash flows actually incurred in respect of insurance contracts that ceased to exist before the transition date).
b) Risk adjustment for non-financial risk (RA) is determined as of the Group's initial recognition date as the RA amount on the transition date adjusted to reflect the expected release from the risk prior to the transition date. The expected release from risk is determined with respect to the release from risk of similar insurance contracts, which the Company issues on the transition date.

The CSM on the transition date is determined by comparing the coverage units on the initial recognition date and the remaining coverage units on the transition date.

Fair value measurement method -

The assessment of the fair value of the liabilities and the reinsurance assets was carried out using the Appraisal Value method (hereinafter - "AV"). The valuation was conducted by an external appraiser. Following are the highlights of the methodology and assumptions underlying the valuation:

a) The AV method determines the fair value of the insurance contract groups by determining the compensation which will be required by a market participant for assuming such portfolios. The abovementioned compensation is required due to the fact that the market participant is required to hold capital in respect of economic solvency requirements, in addition to the basic amounts held in order to pay the expected cash flows to cover insurance liabilities, and in respect of the changes in the capital surplus above the market participant's capital target until the portfolio is extinguished;
b) The valuation assumes that the amounts of the assets to be held by the market participant against the insurance liabilities and against the additional capital buffers required by virtue of the economic solvency regime provisions, will be invested at a risk-free interest rate until they are distributed as dividends;
c) In accordance with the provisions of the Professional Issues Circular, the valuation assumes that the initial economic solvency ratio target required from the market participant will be based on the average of the current capital targets for dividend distribution purposes of the five largest insurance companies in Israel plus a 10% margin, and the final economic solvency ratio target required from the market participant will be based on the average of the future capital targets for dividend distribution purposes of the five largest insurance companies in Israel. Accordingly, the appraisal assumes an initial capital target of 121% in the year following the transition date, which will rise to 135% at the end of 2032 (during which the Transitional Provisions of the Economic Solvency Regime end).
d) The valuation assumes that 40% of the capital requirements will be provided through the raising of Tier 2 capital instruments;
e) The valuation was based, in principle, on cash flow forecasts, including the forecast of expenses, which are used by the Company for the purpose of its solvency regime, in accordance with the Professional Issues Circular's guidance and the assumption that such forecasts reflect those of a market participant;
f) The amount of capital required to be held for the portfolio is affected, among other things, by the level of diversification. In accordance with the provisions of the Professional Issues Circular, as a starting point the valuation is based on the diversification level in the Company's portfolios as of the actual transition date, assuming that this is the diversification level that matches that of a market participant. For the purpose of estimating the capital requirements forecast attributed to the valued portfolios, the valuation assumes that the market participant will market new insurance products, of a similar scope and type to the insurance products

actually marketed by the Company in 2023, which will affect the forecast as to the effect of future diversification. The abovementioned resulting diversification effect has been uniformly allocated to the capital requirements of the assessed insurance portfolios;

The valuation assumes that the market participant will require a total target return on equity of 13.6%, based mainly on the CAPM model.

2) Application of IFRS 9

The application of IFRS 9 has the following effect on the classification and measurement of the Company's financial assets:

Participating portfolio

Financial assets against yield-dependent liabilities, mostly for profit participation savings and other insurance contracts which include profit participation, are measured at fair value through profit or loss, similarly to the current practice under IAS 39.

The nostro portfolio

Derivatives are measured at fair value through profit or loss as is the case in IAS 39.
Investments in debt instruments, which do not meet the Solely Payments of Principal and Interest Test are classified to fair value through profit or loss.
Investments in liquid equity and debt instruments are measured at fair value through profit or loss rather than at fair value through capital reserve (available-for-sale financial assets) under IAS 39.
In group subsidiaries which are insurers, the remaining debt assets are classified to fair value through profit or loss in order to reduce or prevent an accounting mismatch against liabilities for insurance contracts (by designation to fair value through profit or loss of debt assets held against liabilities in respect of insurance contract), or since they are managed at fair value (classification to fair value through profit or loss for the remaining debt assets held against equity and other liabilities which are not insurance liabilities). This will not apply to certain debt assets, which do not constitute investment assets and which meet the Principal and Interest Test, such as debtors' assets, which are accounted for at adjusted cost similarly to IAS 39.

The remaining debt assets, mainly those held against liabilities for non-yield-dependent investment contract, will continue to be accounted for at adjusted cost similarly to IAS 39.

Financial liabilities

The Company does not expect a material change in the classification and measurement of the financial liabilities, except for the measurement of financial liabilities, the conditions of which did not change materially as part of the replacement of equity instruments.

The following table presents the original measurement categories in accordance with the provisions of IAS 39 and the new measurement categories in accordance with the provisions of IFRS 9 with respect to the Group's financial assets and financial liabilities as of January 1, 2024, and the effects of the transition to IFRS 9 on the opening balances of retained earnings and other equity components.

	Original classification	New classification	Carrying value	Carrying value
In NIS million	under IAS 39	under IFRS 9	under IAS 39	under IFRS 9
Financial assets
Financial assets not held against yield
dependent contracts:
Other cash and cash equivalents	Loans and receivables Amortized cost		2,548	2,548
Derivative instruments	Fair value through profit	Fair value through	312	312
	and loss	profit and loss
Investment in liquid debt instruments	Fair value through profit	Fair value through	1,101	1,101
	and loss	profit and loss
Investment in liquid debt instruments	Available-for-sale	Fair value through	6,212	6,212
		profit and loss
Investment in illiquid debt instruments, excluding	Held-to	Fair value through	7,666	7,703
designated bonds and treasury deposits	maturity investments	profit and loss
Investment in illiquid debt instruments, excluding	Held-to	Amortized cost	144	144
designated bonds and treasury deposits	maturity investments
Treasury deposits	Held-to	Amortized cost	2,193	2,193
	maturity investments
Designated bonds	Held-to	Fair value through	14,441	18,539
	maturity investments	profit and loss
Investment in equity instruments	Available-for-sale	Fair value through	1,647	1,647
		profit and loss
Investment in equity instruments	Fair value through profit	Fair value through
	and loss	profit and loss	24	24
Other financial investments	Fair value through profit	Fair value through
	and loss	profit and loss	705	705
Other financial investments		Fair value through
	Available-for-sale	profit and loss	4,820	4,820
Total financial assets not held against yield
dependent contracts:			41,813	45,948
Financial assets held against yield

dependent contracts:
Cash and cash equivalents in respect of yield	Loans and receivables Amortized cost		4,418	4,418
dependent contracts
Financial investments in respect of yield	Fair value through profit	Fair value through	84,133	84,133
dependent contracts	and loss	profit and loss
Total financial assets held against yield
dependent contracts:			88,551	88,551
Total financial assets			130,364	134,499
Financial liabilities
Loans and credit	Amortized cost	Amortized cost	6,091	6,091
Bonds and subordinated notes	Amortized cost	Amortized cost	6,679	6,674
Derivative instruments	Fair value through profit	Fair value through
	and loss	profit and loss	2,929	2,929
Total financial liabilities			15,699	15,694
Reserves and retained earnings
Capital reserve in respect of available-for
sale assets			866	-
Other capital reserves			139	139
Surplus			5,019	4,593
Total reserves and retained earnings			6,024	4,732
Deferred tax assets (liabilities)			(488)	182

In NIS million	Three-month period ended March 31, 2024	Period of year ended December 31, 2024
	(Unaudited)
Comprehensive income as previously reported	165	963
Adjustments to comprehensive income under the transition to IFRS:
• Insurance contracts (1)		26 864
• Financial instruments (2)	177	2
• Tax effect of the above	(52)	(283)
Comprehensive income according to IFRS	316	1,546

(1) The changes in comprehensive income arising from the application of IFRS 17 include mainly the following:

(a) Variation in the pattern of release of income to long-term policies

The pattern of release of income to long-term policies in the Life and Health Insurance Segments, which are not measured under the PAA model, varies substantially between IFRS 17 and IFRS 4, both with respect to an existing business as of the transition date and with respect to a new business, which was marketed subsequent to the transition date.

Under IFRS 4, the pattern of release in risk products was affected, among other things, by the amount of actual premium and the development of actual claims in each period, and by the amortization of deferred acquisition costs.

Under IFRS 17 and as detailed above, on the transition date the Group recognized the CSM and RA components released to income and loss over the coverage periods relating to the various contract groups. The release rate of these components is mainly affected by the coverage units attributed to each reporting period. Furthermore, the income and loss are affected by the difference between the claims and the expected expenses and those actually incurred.

Moreover – in the savings products the income release pattern under IFRS 4 depended on the actual collection of management fees, which depends, among other things, on the existence of a "uncollected management fees" in the participating portfolio and the accrual amount at each actual point in time. On the other hand, in accordance with IFRS 17, the release pattern takes into account the overall expected profitability of the portfolio, including the development of management fees in the future, which were also taken into account regarding the fair value of the existing business in calculating the CSM as of the transition date.

In addition, under IFRS 17, insurance revenues and insurance service expenses do not include investment components, which are mainly included in savings policies, unlike IFRS 4, although this does not affect the income.

(b) Studies

Under IFRS 4, study and model revisions were recognized, in part, immediately in profit or loss. On the other hand, under IFRS 17 these revisions for insurance contracts, which are not measured in accordance with the PAA model and which relate to a future service, adjust the contractual service margin (until it reaches zero), and their effect is recognized in profit or loss under the release of the contractual service margin as detailed above.

Similarly, under IFRS 4, the entire effect of changes in yield rates affecting the amount of management fees in savings policies was recognized immediately in profit or loss. On the other hand, under IFRS 17, effects of financial assumptions and changes therein, including with respect to the abovementioned effect of the management fees in savings policies, for insurance contracts measured in accordance with the VFA Model, the contractual service margin is adjusted (until it reaches zero), and their effect is recognized in profit or loss as part of the release of the contractual service margin as detailed above. It is emphasized that the change in the insurance contract liability under the VFA Model due to changes in the fair value of the underlying items is recognized in full in finance expenses from insurance contracts, against recognition of investment revenues which back them.

In addition, the measurement of all insurance contracts as discount of future cash flows according to current discount rates under IFRS 17, leads to an increase in sensitivity to interest rate changes reflected in profit or loss.

(2) Financial instruments

The changes in comprehensive income arising from the application of IFRS 9 are mainly due to the measurement of most financial assets, in particular designated life insurance bonds, at fair value through profit or loss, instead of measurement of some of these financial assets at cost or at fair value through other comprehensive income (available-for-sale) under IAS 39. Measurement at fair value will reduce the sensitivity to the interest rate in the income statement.

Appendix 1 - Interest revenue and expense rates and analysis of the changes in Max's interest income and expenses

Average balances and interest rates

		For the three months ended March 31, 2025		For the three months ended March 31, 2024
	Average balance(1)	Interest revenues (expenses)	% of revenue (expense)	Average balance(1)	Interest revenues (expenses)	% of revenue (expense)
In NIS million		Percentage				Percentage
Interest-bearing assets
Credit to private individuals (2)	10,590	270	10.20	9,287	253	10.90
Commercial credit (2)(5)	3,461	51	5.89	3,415	47	5.51
Total credit	14,051	321	9.14	12,702	300	9.45
Deposits with banks	645		6 3.72	581	5	3.44
Other assets	72		1 5.56	58	‐	‐
Total assets	14,768	328	8.88	13,341	305	9.14
Non-interest-bearing receivables for credit card transactions	5,136			4,207
Amounts receivable for credit card activity	1,169			1,065
Other non-interest-bearing assets (3)	549			422
Total assets	21,622			19,035
Interest-bearing liabilities
Credit from banking corporations	5,911	(111)	(7.51)	4,939	(101)	(8.18)
Bonds and subordinated notes	915	(13)	(5.68)	767	(12)	(6.26)
Other liabilities	16		‐	21 ‐	(2)	(38.10)
Total interest-bearing liabilities	6,842	(124)	(7.25)	5,727	(115)	(8.03)
Payables for credit card transactions(5)	11,958			10,734
Other non-interest bearing liabilities (6)	736			707
Total liabilities	19,536			17,168
Total capital resources	2,086			1,867
Total capital commitments and resources	21,622			19,035
Interest rate spread			1.63			1.11
Net return on interest-bearing assets (4)	14,768	204	5.53	13,341	190	5.70

(1) Based on beginning-of-month balances.

(2) Before deducting the average on-balance sheet balance of credit loss provisions. Including debts that do not accrue interest income.

(3) Including derivatives, other non-interest-bearing assets, non-monetary assets, and less credit loss provision.

(4) Net return – interest revenues, net divided by total interest-bearing assets.

(5) Including average balance of early payments to merchants and factoring of credit card vouchers for merchants.

(6) Including derivative instruments and non-monetary liabilities.

	For the three months ended March 31, 2025 Interest			For the three months ended March 31, 2024 Interest

	Average balance(1)	revenues (expenses)	% of revenue (expense)	Average balance(1)	revenues (expenses)	% of revenue (expense)
In NIS million			Percentage			Percentage
Non-linked NIS
Total interest-bearing assets	13,026	303	9.30	13,103	301	9.19
Total interest-bearing liabilities	5,536	(112)	(8.09)	5,681	(115)	(8.10)
Interest rate spread			1.21			1.09
CPI-linked NIS
Total interest-bearing assets	1,666	25	6.00	187	4	8.56
Total interest-bearing liabilities	1,306	(12)	(3.68)	46	‐	‐
Interest rate spread			2.32			8.56
Foreign currency (including foreign-currency linked NIS)
Total interest-bearing assets	76		‐	51 ‐	‐	‐
Total interest-bearing liabilities		‐	‐	‐	‐ ‐	‐
Interest rate spread				‐		‐
Total activity
Total interest-bearing assets	14,768	328	8.88	13,341	305	9.14
Total interest-bearing liabilities	6,842	(124)	(7.25)	5,727	(115)	(8.03)
Interest rate spread			1.63			1.11

(1) Based on beginning-of-month balances.

Analysis of changes in interest income and expenses

	Three months ended March 31, 2025 Increase (decrease) due to change

			Net
In NIS million	Quantity	Price	change
Interest-bearing assets
Credit to private individuals		33	(16)	17
Commercial credit		1	3	4
Total credit		34	(13)	21
Deposits with banks		1	‐	1
Other assets		‐	1	1
Total interest revenues		35	(12)	23
Interest-bearing liabilities
Credit from banking corporations		(18)	8	(10)
Bonds and subordinated notes		(2)	1	(1)
Other liabilities		‐	2	2
Total interest revenues (expenses)		(20)	11	(9)
Total interest revenues (expenses)		15	(1)	14

		Three months ended March 31, 2024 Increase (decrease) due to change
In NIS million
			Net
	Quantity	Price		change
Interest-bearing assets
Credit to private individuals		33	(16)	17
Commercial credit		1	3	4
Total credit		34	(13)	21
Deposits with banks		1	‐	1
Other assets		‐	1	1
Total interest revenues		35	(12)	23
Interest-bearing liabilities
Credit from banking corporations		(18)	8	(10)
Bonds and subordinated notes		(2)	1	(1)
Other liabilities		‐	2	2
Total interest revenues (expenses)		(20)	11	(9)
Total interest revenues (expenses)		15	(1)	14

Clal Insurance Enterprises Holdings Ltd. Separate Financial Data from the Consolidated Interim Financial Statements Attributable to the Company as of March 31, 2025 (Regulation 38D) (Unaudited)

	Page
Special Report of the Independent Auditors on the Separate Interim Financial Information	3-2
Interim Financial Information of the Company:
Interim Data on Financial Position	3-3
Interim Profit and Loss Data	3-4
Interim Comprehensive Income Data	3-5
Interim Cash Flow Data	3-6
Additional Information	3-7

Somekh Chaikin Millennium Tower KPMG 17 HaArba'a Street, POB 609 Tel Aviv 6100601 +972-3-684-8000

Kost Forer Gabbay & Kasierer 144 Menachem Begin St., Tel Aviv 6492102 Tel. +972 3 623 2525 Fax +972 3 562 2555 ey.com

Shareholders of Clal Insurance Enterprises Holdings Ltd.

Re: Special report of the independent auditors on Separate Financial Information in accordance with Regulation 9C to the Securities Regulations (Periodic and Immediate Reports), 1970

Introduction

We have audited the Interim Separate Financial Information disclosed in accordance with Regulation 38D to the Securities Regulations (Periodic and Immediate Reports), 1970 of Clal Insurance Enterprises Holdings Ltd. (hereinafter – the "Company") as of March 31, 2025 and for the three-month period ended on that date. The Interim Separate Financial Information is the responsibility of the Company's Board of Directors and management. Our responsibility is to express a conclusion regarding the Separate Interim Financial Information for this interim period based on our review.

Scope of review

Conclusion

Based on our review and the review, nothing has come to our attention that causes us to believe that the abovementioned Interim Separate Financial Information does not comply, in all material respects, with the disclosure provisions of Chapter 38D of the Israel Securities Regulations (Periodic and Immediate Reports), 1970.

Tel Aviv, May 28, 2025

Interim Data on Financial Position

	As of March 31		As of December 31
	2025	2024	2024
In NIS million		Unaudited
Assets
Investment in investees	9,526	8,336	9,121
Loans and balances of investees	1,012	703	1,010
Receivables and debit balances	1	1	1
Other financial investments:
Liquid debt assets	8	18	9
Shares	46	21	34
Other	64	35	100
Total other financial investments	118	75	142
Cash and cash equivalents	39	21	37
Total assets	10,697	9,136	10,312
Equity
Share capital	167	167	167
Share premium	2,426	2,394	2,423
Capital reserves	140	140	138
Retained earnings	6,420	4,903	6,014
Total equity	9,154	7,603	8,742
Liabilities
Payables and credit balances	18	14	46
Balances of investees	1	2	2
Financial liabilities	1,524	1,516	1,522
Total liabilities	1,542	1,533	1,569
Total equity and liabilities	10,697	9,136	10,312

The attached additional information is an integral part of the Company's Interim Separate Financial Information.

May 28, 2025

Approval date of the financial statements Haim Samet

Chairman of the Board of Directors Yoram Naveh CEO

Eran Cherninsky Executive Vice President Head of the Finance Division

Interim Profit and Loss Data

	For the three-month period ended March 31		For the year ended December 31
	2025	2024	2024
In NIS million	Unaudited
Company's share in the profits (losses) of investees, net of tax	403	318	1,563
Net investment income (losses) and finance income
From investees	7	7	41
Other	20	11	28
Total revenue	430	336	1,632
General and administrative expenses	3	3	12
Finance expenses	20	20	80
Total expenses	23	23	91
Income (loss) before taxes on income	407	313	1,540
Income tax expense (tax benefit)	‐	‐	‐
Income (loss) for the period	407	313	1,540

The attached additional information is an integral part of the Company's Interim Separate Financial Information.

Interim Comprehensive Income Data

	For the three For the month period year ended
	ended March 31 December 31
	2025	2024	2024
In NIS million		Unaudited
Income (loss) for the period	407	313	1,540
Other comprehensive income:
Other comprehensive income items that, subsequent to initial recognition in comprehensive income, were or will be carried to profit and loss:
Other comprehensive income (loss) in respect of investees which was transferred or will be transferred to profit and loss, net of tax	2	1	(1)
Other comprehensive income (loss) for the period carried or to be carried to profit and loss, before tax	2	1	(1)
Taxes (tax benefit) in respect of other components of comprehensive income (loss)	‐	‐	‐
Other comprehensive income (loss) items that, subsequent to initial recognition in comprehensive income, were or will be carried to profit and loss, net of tax	2	1	(1)
Items of other comprehensive income not transferred to profit and loss:
Other comprehensive income for investees not transferred to profit and loss, net of tax	‐	‐	1
Other comprehensive income for the period, not transferred to profit and loss, net of tax	‐	‐	1
Other comprehensive income (loss) for the period	2	1	‐
Total comprehensive income (loss) for the period	409	314	1,540

The attached additional information is an integral part of the Company's Interim Separate Financial Information.

Interim Cash Flow Data

	For the three-month period ended March 31		For the year ended December 31
	2025	2024		2024
In NIS million		Unaudited
Cash flows from operating activities
Income (loss) for the period	407	313		1,540
Adjustments:
Company's share in the profits (losses) of investees	(403)	(318)		(1,563)
Dividend from investees	‐		‐	166
Interest accrued on deposits with banks	‐		‐	(2)
Interest accrued in respect of the capital note for the investee	‐		4	(30)
Accrued interest and deduction of issuance costs and discount for bonds	20	20		80
Loss (profit) from other financial investments	(20)	(10)		(24)
Taxes on income	‐		‐	‐
Total adjustments	(403)	(305)		(1,373)
Changes in other items in the data on financial position, net:
Change in receivables and debit balances	‐	(1)		(1)
Change in payables and credit balances	‐	(1)		‐
Total changes in other items in the data on financial position, net	‐	(2)		(1)
Cash received during the period for:
Net cash provided by operating activity for transactions with investees	(1)	(2)		7
Interest received	‐		1	2
Income tax received (paid)	‐		‐	‐
Net cash provided by operating activities	4		6	175
Cash flows provided by investing activities
Repayment of interest from the capital note to the investee	‐		‐	23
Investment in investees 2)	‐	(891)		(891)
Investment in available-for-sale financial assets	(2)	(27)		(97)
Proceeds from sale of available-for-sale financial assets	46	973		990
Net cash provided by (used for) investing activities	44	55		25
Cash flows provided by financing activities
Proceeds from issuance of share capital (less issuance expenses)	‐		‐	‐
Interest paid on the bonds	(46)	(48)		(72)
Dividend paid	‐		‐	(100)
Net cash provided by (used for) financing activities	(46)	(48)		(172)
Increase (decrease) in cash and cash equivalents	2	12		28
Cash and cash equivalents as of the beginning of the period	37		9	9
Cash and cash equivalents at the end of the period	39	21		37

Additional Information

1. General

The Interim Separate Financial Information is presented in accordance with Regulation 38D of the Securities Regulations (Periodic and Immediate Reports), 1970 and does not include all the information required under Regulation 9C and the Tenth Addendum to the Securities Regulation (Periodic and Immediate Reports), 1970, "Separate Financial Information of the Corporation". This separate interim financial information should be read in conjunction with the separate financial information as of the date and year ended December 31, 2023 and in conjunction with the condensed consolidated interim financial statements as of June 30, 2024 (hereinafter - the "Consolidated Interim Financial Statements").

2. Share-based payment

For details regarding the option plan published by the Company subsequent to the report date, see Note 13(b) to the Consolidated Interim Financial Statements.

3. Dividend distribution by the Company

Subsequent to the reporting date, the Company's Board approved a dividend distribution totaling approx. NIS 200 million, which constitutes approx. 64% of the dividends declared and/or distributed in the Company's subsidiaries as of the approval date of the Consolidated Interim Financial Statements. For further details, see Note 13(h) to the Consolidated Interim Financial Statements.

Clal Insurance Enterprises Holdings Ltd.

Quarterly Report on the Effectiveness of the Internal Control

over Financial Reporting and Disclosure

as of March 31, 2025

in accordance with Regulation 38C(a)

Quarterly Report on the Effectiveness of the Internal Control over Financial Reporting and Disclosure in accordance with Regulation 38C(a)

Management, under the supervision of the Board of Directors of Clal Insurance Enterprises Holdings Ltd. (hereinafter - the "Corporation") is responsible for establishing and maintaining adequate internal control over financial reporting and disclosure in the Corporation.

For this matter, the members of management are as follows:

1. Yoram Naveh CEO of the Company and Clal Insurance;
1. Eran Czerninski Head of the Finance Division (an officer in Clal Insurance and Clal Holdings);
1. Dror Biran Legal Counsel (an officer in Clal Insurance and Clal Holdings);
1. Tomer David Internal Auditor (an officer in Clal Insurance and Clal Holdings);
1. Barak Benski Head of the Investments Division (an officer in Clal Insurance and Clal Holdings);
1. Avi Ben Noon Chief Risk Officer (an officer in Clal Insurance and Clal Holdings);

Internal control over financial reporting and disclosure includes controls and procedures existing in the Corporation, which were planned or overseen by the CEO and the most senior financial officer or under their supervision, or by whoever fulfills these functions in practice, under the supervision of the Board of Directors of the Corporation, and were designed to provide reasonable assurance as to the reliability of the financial reporting and the preparation of the reports in accordance with the provisions of the law, and to ensure that information that the Corporation is required to disclose in the reports it publishes in accordance with the provisions of the law is collected, processed, summarized and reported on the date and in the format laid down in law.

Among other things, internal controls include controls and procedures planned to ensure that all information that the Corporation is required to disclose as aforesaid is collected and transferred to the Corporation's management, including the chief executive officer and the most senior financial officer, or the equivalent acting officers, in order to allow decision making on a timely basis with respect to the disclosure requirements.

Due to its inherent limitations, internal control over financial reporting and disclosure is not designed to provide absolute assurance that misstatements or omissions of information in the financial statements shall be prevented or detected.

Clal Insurance Company Ltd. (hereinafter - "Clal Insurance"), a subsidiary of the Corporation, is an institutional entity which is subject to the directives of the Commissioner of the Capital Market, Insurance and Savings in the Ministry of Finance regarding the assessment of the effectiveness of internal controls over financial reporting.

In relation to internal controls in the said subsidiary, the Corporation implements the following directives: The Institutional Entities Circular 2009-9-10 on "Management's Responsibility for Internal Control over Financial Reporting"; Institutional Entities Circular 2010-9-6 on "Management's Responsibility for Internal Control over Financial Reporting - Amendment" and Institutional Entities Circular 2010-9-7 on "Internal Control over Financial Reporting - Statements, Reports and Disclosures".

Max It Finance Ltd., a subsidiary of the Corporation, is a credit card company, which is subject to the directives of the Banking Supervision Department regarding the assessment of the effectiveness of internal control over financial reporting.

With respect to the internal control of the said subsidiary, the Corporation implements the following provisions: Proper Conduct of Banking Business Directive 309.

In the Annual Report on the Effectiveness of Internal Control over Financial Reporting and Disclosure attached to the periodic report for the period ended December 31, 2024 (hereinafter - the "Most Recent Annual Report Over Internal Control"), the Board of Directors and management assessed the internal control in the corporation; based on the effectiveness assessment made by management, with the supervision of the Board of Directors as detailed above, the Corporation's Board of Directors and management came to the conclusion that the internal control over financial reporting and disclosure in the corporation as of December 31, 2024 is effective.

As of the report date, the Board of Directors and management have not been informed of any event or matter that may alter the assessment of the effectiveness of internal control, as presented in the Most Recent Annual Report Over Internal Control.

As of the report date, based on the Most Recent Annual Report over Internal Control and based on information brought to the attention of management and the Board of Directors as stated above, the internal control is effective.

Certification by Officers

Certification by the CEO

I, Yoram Naveh, hereby declare that:

1. I have reviewed quarterly report of Clal Insurance Enterprises Holdings Ltd. (hereinafter the "Corporation") for the first quarter of 2025 (hereinafter – the "Reports");
1. To my knowledge, the Reports do not contain any misrepresentation of a material fact, or omit a representation of a material fact that is necessary in order for the representations included therein under the circumstances in which such representations were included - to be misleading as to the reporting period;
1. To my knowledge, the financial statements and other financial information included in the Reports present fairly, in all material aspects, the Company's financial position, financial performance and cash flows of the Corporation as of the dates and for the periods covered by the Reports;
1. I have disclosed to the independent auditor of the Corporation, the Board of Directors, and the Board of Directors' balance sheet committee, based on my most recent evaluation of the internal control over financial reporting and disclosure, the following:
2. A. All significant deficiencies and material weaknesses in the establishment or implementation of the internal controls over financial reporting and disclosure that may adversely affect, in a reasonable manner, the Corporation's ability to collect, process, summate or report financial information in a manner that may give rise to doubt as to the reliability of financial reporting and preparation of the financial statements in accordance with the provisions of the law; and -
3. B. Any fraud, whether material or not, involving the chief executive officer or anyone directly reporting thereto or involving other employees who have a significant role in the internal control over financial reporting and disclosure;
1. I, alone or together with others in the Corporation, state that:
2. A. I have established such controls and procedures, or ensured that such controls and procedures under my supervision be established and in place, designed to ensure that material information relating to the Corporation, including its consolidated companies as defined in the Securities Regulations (Annual Financial Statements), -2010, is brought to my attention by others in the Corporation and the consolidated companies, particularly during the Reports' preparation period; and -
3. B. I have established controls and procedures or ensured that such controls and provisions under my supervision be established and in place, designed to ensure, in a reasonable manner, the reliability of financial reporting and preparation of financial statements in accordance with the provisions of the law, including in accordance with generally accepted accounting principles.
4. C. No event or matter has been brought to my attention during the period between the periodic report date and the date of this Report which alters the conclusion of the Board of Directors and Management in respect of the effectiveness of the internal control over the Corporation's financial reporting and disclosure.

Nothing in the foregoing shall derogate from my responsibility or the responsibility of any other person, under any law.

Yoram Naveh CEO

May 28, 2025

Certification by Officers

Certification by the Most Senior Financial Officer

I, Eran Cherninsky, hereby declare that:

1. I have reviewed the financial statements and other financial information included in the reports of Clal Insurance Enterprises Holdings Ltd. (hereinafter - the "Corporation") for the first quarter of 2025 (hereinafter - the "Reports");
1. To my knowledge, the interim financial statements and other financial information included in the Interim Reports do not contain any misrepresentation of a material fact, nor omit a representation of a material fact that is necessary in order for the representations included therein - under the circumstances in which such representations were included - to be misleading as to the reporting period;
1. To my knowledge, the Interim Financial Statements and other financial information included in the Interim Reports present fairly, in all material aspects, the Company's financial position, financial performance and cash flows of the Corporation as of the dates and for the periods covered by the Reports;
1. I have disclosed to the independent auditor of the Corporation, the Board of Directors, and the Board of Directors' balance sheet committee, based on my most recent evaluation of the internal control over financial reporting and disclosure, the following:
2. A. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting and disclosure insofar as it relates to the Interim Financial Statements and other financial information included in the Interim Reports, that could reasonably adversely affect the Corporation's ability to collect, process, summarize or report financial information so as to cast doubt on the reliability of financial reporting and the preparation of the financial statements in accordance with law; and -
3. B. Any fraud, whether material or not, involving the chief executive officer or anyone directly reporting thereto or involving other employees who have a significant role in the internal control over financial reporting and disclosure.
1. I, alone or together with others in the Corporation, state that
2. A. I have established such controls and procedures, or ensured that such controls and procedures under my supervision be established and in place, designed to ensure that material information relating to the Corporation, including its consolidated companies as defined in the Securities Regulations (Annual Financial Statements), -2010, is brought to my attention by others in the Corporation and the consolidated companies, particularly during the Reports' preparation period; and -
3. B. I have established controls and procedures, or ensured that such controls and provisions under my supervision be established and in place, designed to ensure, in a reasonable manner, the reliability of financial reporting and preparation of financial statements in accordance with the provisions of the law, including in accordance with generally accepted accounting principles;
4. C. No event or matter has been brought to my attention during the period between the periodic report date and the date of this Report, relating to the Interim Financial Statements and to any other financial information included in the Interim Financial Statements, which may, in my opinion, change the conclusion of the Board of Directors and management regarding the effectiveness of internal controls over the corporation's financial reporting and disclosure.

Nothing in the foregoing shall derogate from my responsibility or the responsibility of any other person, under any law.

Eran Cherninsky Executive VP Head of the Finance Division

May 28, 2025

Statements regarding Controls and Procedures in respect of Disclosure in the Financial Statements of Clal Insurance Company Ltd.

Clal Insurance Company Ltd.

Certification

I, Yoram Naveh, hereby declare that:

1. I have reviewed the quarterly report of Clal Insurance Company Ltd. (hereinafter the "Company") for the quarter ended March 31, 2025 (hereinafter - the "Report").
1. To my knowledge, the Report does not contain any misrepresentation of a material fact, or omit a representation of a material fact, that is necessary in order for the representations included in it - under the circumstances in which such representations were included - to be misleading as to the reporting period.
1. To my knowledge, the quarterly financial statements and other financial information included in the Report present fairly, in all material aspects, the Company's financial position, financial performance and changes in equity and cash flows as at the dates and for the periods covered by the report.
1. I and others at the Company signing this certification are responsible for the establishment and implementation of controls and procedures regarding the Company's disclosure(1) and internal control over financial(1) reporting of the Company; and -
2. A. We have established such controls and procedures, or caused such controls and procedures to be established under our oversight, with the aim of ensuring that material information about the Company and its consolidated companies is brought to our attention by others in the Company and these companies, especially during the preparation of the Report;
3. B. We have established such internal controls over the financial reporting or have overseen the establishment of such controls over financial reporting, with the aim of providing reasonable assurance as to the reliability of the financial reporting and that the financial statements have been prepared in accordance with the International Financial Reporting Standards (IFRS) and the directives of the Commissioner of the Capital Market, Insurance and Savings;
4. C. We have evaluated the effectiveness of the Company's disclosure controls and procedures and presented in the Report our conclusions regarding the effectiveness of the disclosure controls and procedures as of the end of the reporting period according to our evaluation; and -
5. D. The Report discloses any change in the Company's internal control over financial reporting which occurred during the quarter and has materially affected, or is reasonably expected to affect, the Company's internal control over financial reporting. and -
1. I and others at the Company signing this certification have disclosed to the joint independent auditors, the Board of Directors, and the Board of Directors' balance sheet committee, based on our most recent evaluation of the internal control over financial reporting, the following:
2. A. All significant deficiencies and material weaknesses in the establishment or implementation of the internal controls over financial reporting that may harm the Company's ability to record, process, summarize and report financial information; and -
3. B. Any fraud, whether or not material, involving management or other employees who have a significant role in the Company's internal control over financial reporting.

Nothing in the foregoing shall derogate from my responsibility or the responsibility of any other person, under any law.

Yoram Naveh CEO

May 28, 2025

(1) As defined in the provisions of the Institutional Entities Circular titled "Internal Controls over Financial Reporting - Statements, Reports and Disclosures".

Clal Insurance Company Ltd.

Certification

I, Eran Cherninsky, hereby declare that:

1. I have reviewed the quarterly report of Clal Insurance Company Ltd. (hereinafter the "Company") for the quarter ended March 31, 2025 (hereinafter - the "Report").
1. To my knowledge, the Report does not contain any misrepresentation of a material fact, or omit a representation of a material fact, that is necessary in order for the representations included in it - under the circumstances in which such representations were included - to be misleading as to the reporting period.
1. To my knowledge, the financial statements and other financial information included in the Report present fairly, in all material aspects, the Company's financial position, financial performance and changes in equity and cash flows as of the dates and for the periods covered by the report.
1. I and others at the Company signing this certification are responsible for the establishment and implementation of controls and procedures regarding the Company's disclosure(1) and internal control over financial(1) reporting of the Company; and -
2. A. We have established such controls and procedures, or caused such controls and procedures to be established under our oversight, with the aim of ensuring that material information about the Company and its consolidated companies is brought to our attention by others in the Company and these companies, especially during the preparation of the Report;
3. B. We have established such internal controls over the financial reporting or have overseen the establishment of such controls over financial reporting, with the aim of providing reasonable assurance as to the reliability of the financial reporting and that the financial statements have been prepared in accordance with the International Financial Reporting Standards (IFRS) and the directives of the Commissioner of the Capital Market, Insurance and Savings;
4. C. We have evaluated the effectiveness of the Company's disclosure controls and procedures and presented in the Report our conclusions regarding the effectiveness of the disclosure controls and procedures as of the end of the reporting period according to our evaluation; and -
5. D. The Report discloses any change in the Company's internal control over financial reporting which occurred during the quarter and has materially affected, or is reasonably expected to affect, the Company's internal control over financial reporting. and -
1. I and others at the Company signing this certification have disclosed to the joint independent auditors, the Board of Directors, and the Board of Directors' balance sheet committee, based on our most recent evaluation of the internal control over financial reporting, the following:
2. A. All significant deficiencies and material weaknesses in the establishment or implementation of the internal controls over financial reporting that may harm the Company's ability to record, process, summarize and report financial information; and -
3. B. Any fraud, whether or not material, involving management or other employees who have a significant role in the Company's internal control over financial reporting.

Nothing in the foregoing shall derogate from my responsibility or the responsibility of any other person, under any law.

Eran Cherninsky Deputy CEO Head of the Finance Division

May 28, 2025

(1) As defined in the provisions of the Institutional Entities Circular titled "Internal Controls over Financial Reporting - Statements, Reports and Disclosures".

Max It Finance Ltd.

Certification

I, Sagit Dotan, declare that:

1. I have reviewed the quarterly report of Max It Finance Ltd. (hereinafter the "Company") for the quarter ended March 31, 2025 (hereinafter - the "Report").
1. To my knowledge, the Report does not contain any misrepresentation of a material fact, or omit a representation of a material fact, that is necessary in order for the representations included in it - under the circumstances in which such representations were included - to be misleading as to the reporting period.
1. To my knowledge, the financial statements and other financial information included in the report fairly represent, in all material aspects, the Company's financial position, financial performance, changes in equity and cash flows as at the dates and for the periods presented in the Report.
1. I and others at the Company signing this certification are responsible for the establishment and implementation of controls and procedures regarding the Company's disclosure(1) and internal control over financial(1) reporting of the Company, and:
2. A. We have established such controls and procedures, or caused such controls and procedures to be established under our oversight, with the aim of ensuring that material information about the Company and its consolidated corporations is brought to our attention by others in the Company and these corporations, especially during the preparation of the Report;
3. B. We have established such internal control over financial reporting or have caused such internal control to be established under our oversight, with the aim of providing reasonable assurance as to the reliability of the financial reporting and that the financial statements for external purposes have been prepared in accordance with the generally accepted accounting principles and the directives and guidance of the Banking Supervision Department;
4. C. We have evaluated the effectiveness of the Company's disclosure controls and procedures and presented in the Report our conclusions regarding the effectiveness of the disclosure controls and procedures as of the end of the reporting period according to our evaluation, and
5. D. The Report discloses any change in the Company's internal control over financial reporting which occurred during the quarter and has materially affected, or is reasonably expected to affect, the Company's internal control over financial reporting; and
1. I and others at the Company signing this certification have disclosed to the joint independent auditors, the Board of Directors, and the Board of Directors' audit committee, based on our most recent evaluation of the internal control over financial reporting, the following:
2. A. All significant deficiencies and material weaknesses in the establishment or implementation of the internal controls over financial reporting that may harm the Company's ability to record, process, summarize and report financial information; and -
3. B. Any fraud, whether or not material, involving management or other employees who have a significant role in the Company's internal control over financial reporting.

Nothing in the foregoing shall derogate from my responsibility or the responsibility of any other person, under any law.

Sagit Dotan CEO

May 28, 2025

(1) As defined in the Reporting to the Public Directives regarding the Report of the Board of Directors and Management.

Max It Finance Ltd.

Certification

I, Sharon Gur, hereby declare that:

1. I have reviewed the quarterly report of Max It Finance Ltd. (hereinafter the "Company") for the quarter ended March 31, 2025 (hereinafter - the "Report").
1. To my knowledge, the Report does not contain any misrepresentation of a material fact, or omit a representation of a material fact, that is necessary in order for the representations included in it - under the circumstances in which such representations were included - to be misleading as to the reporting period.
1. To my knowledge, the financial statements and other financial information included in the report fairly represent, in all material aspects, the Company's financial position, financial performance, changes in equity and cash flows as at the dates and for the periods presented in the Report.
1. I and others at the Company signing this certification are responsible for the establishment and implementation of controls and procedures regarding the Company's disclosure(1) and internal control over financial(1) reporting of the Company, and:
2. A. We have established such controls and procedures, or caused such controls and procedures to be established under our oversight, with the aim of ensuring that material information about the Company and its consolidated corporations is brought to our attention by others in the Company and these corporations, especially during the preparation of the Report;
3. B. We have established such internal control over financial reporting or have caused such internal control to be established under our oversight, with the aim of providing reasonable assurance as to the reliability of the financial reporting and that the financial statements for external purposes have been prepared in accordance with the generally accepted accounting principles and the directives and guidance of the Banking Supervision Department;
4. C. We have evaluated the effectiveness of the Company's disclosure controls and procedures and presented in the Report our conclusions regarding the effectiveness of the disclosure controls and procedures as of the end of the reporting period according to our evaluation, and
5. D. The Report discloses any change in the Company's internal control over financial reporting which occurred during the quarter and has materially affected, or is reasonably expected to affect, the Company's internal control over financial reporting; and
1. I and others at the Company signing this certification have disclosed to the joint independent auditors, the Board of Directors, and the Board of Directors' audit committee, based on our most recent evaluation of the internal control over financial reporting, the following:
2. A. All significant deficiencies and material weaknesses in the establishment or implementation of the internal controls over financial reporting that may harm the Company's ability to record, process, summarize and report financial information; and -
3. B. Any fraud, whether or not material, involving management or other employees who have a significant role in the Company's internal control over financial reporting.

Nothing in the foregoing shall derogate from my responsibility or the responsibility of any other person, under any law.

Sharon Gur CFO, Chief Accounting Officer

May 28, 2025

(1) As defined in the Reporting to the Public Directives regarding the Report of the Board of Directors and Management.

Economic Solvency Ratio Report of Clal Insurance Company Ltd.

as of December 31, 2024

Economic Solvency Ratio Report of Clal Insurance Company Ltd. As of December 31, 2024

	Special Report of the Independent Auditors	5-2
1.	Overview and Disclosure Requirements	5-4
	Economic Solvency Regime 1.1.	5-4
	Disclosure and Reporting Provisions in connection with Economic Solvency Ratio Report 1.2.	5-5
	Provisions during the Transitional Period 1.3.	5-5
	Definitions 1.4.	5-6
	Calculation Methodology 1.5.	5-7
	Comments and clarifications 1.6.	5-9
2.	Economic solvency ratio and minimum capital requirement (MCR)	5-11
	Solvency ratio 2.1.	5-11
	Minimum capital requirement 2.2.	5-12
3.	Economic balance sheet	5-13
	Information about economic balance sheet 3.1.	5-14
	Composition of liabilities in respect to insurance contracts and investment contracts 3.2.	5-18
4.	Shareholders' equity in respect of SCR	5-20
	4.1. Composition of eligible capital	5-21
5.	Solvency capital requirement (SCR)	5-22
6.	Minimum capital requirement (MCR)	5-23
	6.1. Minimum capital requirement (MCR)	5-23
	6.2. Shareholders' equity for MCR	5-23
7.	Effect of the application of the directives for the Transitional Period	5-24
8.	Report of Movements in Capital Surplus	5-25
9.	Sensitivity tests	5-27
10.	Restrictions on dividend distribution	5-28
	10.1. Dividend	5-28
	10.2. Capital management and dividend distribution policies	5-28
	10.3. Solvency ratio without applying the Provisions for the Transitional Period	5-29

Somekh Chaikin Millennium Tower KPMG 17 Haarbaa Street, POB 609 Tel Aviv 6100601 +972-3-684-8000

Kost Forer Gabbay & Kasierer 144 Menachem Begin St., Tel Aviv, 6492102 Tel. +972 3 623 2525 Fax +972 3 562 2555 ey.com

To:

Board of Directors of Clal Insurance Company Ltd.

Dear Sir/Madam,

Re: Examination of the Application of Certain Instructions of the Commissioner of the Capital Market, Insurance and Savings regarding the Solvency II-Based Economic Solvency Requirement of Clal Insurance Company Ltd. (hereinafter - the "Company") as of December 31, 2024

We examined the capital required to maintain the solvency capital requirement (hereinafter - "SCR") and the economic capital of Clal Insurance Company Ltd. as of December 31, 2024 (hereinafter - the "Information"), included in the Company's Economic Solvency Ratio Report attached hereby (hereinafter - the "Report").

The Board of Directors and management bear the responsibility for the preparation and presentation of the Information drawn up in accordance with the directives of the Commissioner of the Capital Market, Insurance and Savings (hereinafter - the "Commissioner") regarding Solvency II-based economic SCR of an insurance company as included the Commissioner's Circular No. 2020-1-15 dated October 14, 2020, and in accordance with the Commissioner's Directives regarding principles for calculation of Deduction during the Transitional Period in a Solvency II-based Economic Solvency Regime of October 15, 2020 (hereinafter - the "Directives").

The calculations, forecasts and assumptions on which the preparation of the Information was based fall under the responsibility of the Board of Directors and management.

We conducted our examination in accordance with International Standard on Assurance Engagements No. 3400 - The Examination of Prospective Financial Information, and in accordance with the Commissioner's Directives, as included in Insurance Circular 2017-1-20 of December 3 2017, which provides guidance as to audit of Economic Solvency Ratio Report.

We did not examine the appropriateness of the Deduction during the Transitional Period as of December 31, 2024, as presented in Section 1.5.3 to the Report, except for verifying that the Deduction Amount does not exceed the expected discounted amount of the risk margin and the capital required for solvency in respect of life and health insurance risks arising from existing businesses during the Transitional Period in accordance with the pattern of future development of the required capital, which affects both the calculation of the expected capital release and the release of the expected risk margin as detailed in the provisions on calculation of risk margin.

Except for the abovementioned in connection with the appropriateness of the Deduction Amount during the Transitional Period, based on the examination of the evidence supporting the calculations, the forecasts and the assumptions, as referred to below, which were used by the Company's Board of Directors and management in the preparation of the information nothing came to our attention which caused us to believe that the forecasts and assumptions, as a whole, do not constitute a reasonable basis for the information in accordance with the Directives. Furthermore, in our opinion, the information, including the method employed to determine the assumptions and forecasts, was prepared and presented in all material respects in accordance with the Directives.

It should be emphasized that the projections and assumptions are based mainly on past experience, as arising from actuarial studies conducted from time to time. In view of the reforms in the capital market, insurance and savings, and the changes in the economic environment, past data do not necessarily reflect future results. The information is sometimes based on assumptions regarding future events, steps taken by management, and the pattern of the future development of the risk margin, that will not necessarily materialize or will materialize in a manner different than the assumptions used in the information. Furthermore, actual results may materially vary from the information, since the combined scenarios of events may materialize in a manner that is materially different than the assumptions made in the information.

We draw attention to Section 1.6 - comments and clarifications regarding the solvency ratio, the uncertainty derived from regulatory changes and exposure to contingent liabilities, the effect of which on the solvency ratio cannot be estimated.

Respectfully,

Tel Aviv May 28, 2025

Somekh Chaikin Certified Public Accountants Kost Forer Gabbay & Kasierer Certified Public Accountants Joint Independent Auditors

1. Overview and disclosure requirements

1.1 Solvency II-based Economic Solvency Regime

The information provided below was calculated in accordance with the provisions of Circular 2020-1-15 of the Commissioner of the Capital Market, Insurance and Savings (hereinafter - the "Commissioner") - "Amendment to the Consolidated Circular concerning Implementation of a Solvency II-Based Economic Solvency Regime for Insurance Companies" (hereinafter - the "Provisions of the Economic Solvency Regime"). The information was prepared and presented in accordance with the provisions of Chapter 1, Part 4, Section 5 in the Consolidated Circular, as updated in Circular 8-1-2022 (hereinafter - the "Disclosure Provisions"). The Solvency Circular sets a standard model for calculating existing shareholders' equity and the solvency capital requirement, aiming to bring insurance companies to a situation where they have the capacity to absorb losses arising from the materialization of unexpected risks to which they are exposed. The solvency ratio is the ratio between an insurance company's existing shareholder's equity and its regulatory solvency capital requirement.

The existing shareholders' equity for economic solvency regime purposes will be composed of Tier 1 capital and Tier 2 capital. Tier 1 Capital includes shareholders' equity calculated through assessing the value of an insurance company's assets and liabilities in accordance with the circular's provisions. Additional Tier 1 capital and Tier 2 capital include equity instruments with loss absorption mechanisms, including Subordinated Tier 2 capital, Hybrid Tier 2 capital and Tier 3 capital, which were issued prior to the circular's effective date. The circular includes restrictions on the composition of shareholders' equity for SCR purposes (see below), such that the rate of components included in Tier 2 Capital shall not exceed 40% of the SCR (will not exceed 50% during the Transitional Period, as described below).

The existing eligible capital should be compared to the capital requirement when there are two levels of capital requirements:

The capital requirement to maintain an insurance company's solvency (hereinafter "SCR"). The SCR is risksensitive, and is based on a forward-looking calculation of the effect of the various scenarios' materialization, while taking into account the correlation of the various risk factors, based on the guidance of the Solvency Circular.
Minimum capital requirement (hereinafter "MCR" or "Minimum Capital Requirement"). In accordance with the Provisions of the Economic Solvency Regime, the minimum capital requirement shall be equal to the highest of the amount of the minimum Tier 1 capital requirement from an insurance company under the Capital Regulations and an amount derived from insurance reserves and premiums (as defined in the Provisions of the Economic Solvency Regime), with a floor of 25% and a cap of 45% of the SCR.

The existing capital and the capital requirement are calculated using data and models for calculating the economic solvency ratio, which are based, among other things, on forecasts and assumptions that rely mainly on past experience. The calculations performed as part of the economic capital calculation and the capital requirements are highly complex.

With respect to the calculation of the solvency ratio as of December 31, 2024, an audit was carried out by the independent auditor in accordance with the Commissioner's Directives.

The audit held in accordance International Standard on Assurance Engagement (ISAE) 3400 – "The Examination of Prospective Financial Information."

Forward-looking information

The data included in this Economic Solvency Ratio Report, including the eligible shareholders' equity and solvency capital requirement are based, among other things, on forecasts, assessments, and estimates of future events, the materialization of which is uncertain and is not under the Company's control, and which should be considered as "forward-looking information" as the term is defined in Section 32A to the Securities Law, 1968. Actual results may differ from the results reflected in this Economic Solvency Ratio Report, if such forecasts, assessments and estimates, either in whole or in part, fail to materialize or materialize in a manner different than anticipated, including, among other things, with respect to actuarial assumptions (including the rate of release of the risk margin, mortality rates, morbidity rates, recovery rates, cancellations, expenses, uptake of pension benefits, and underwriting income rate), assumptions regarding future management actions, assumptions regarding the development pattern of the capital requirements and risk margin, risk-free interest rates, capital market returns, future revenue, and damage in catastrophe scenarios.

1.2 Disclosure and Reporting Provisions in connection with Economic Solvency Ratio Report

The Disclosure Circular stipulates, among other things, that the Economic Solvency Ratio Report as of December 31 and June 30 will be included in the first periodic report published after the calculation date, and posted on the Company's website on those dates. The Economic Solvency Ratio Report as of December 31 of each year shall be audited by the Company's independent auditor of the Company as from the report as of December 31, 2018. In addition, the circular includes provisions regarding the structure of the Economic Solvency Ratio Report, its approval by the relevant organs in the Company, the requirement that it will be audited by the Company's independent auditor, and the disclosure requirements in respect thereof.

1.3 Provisions during the Transitional Period

The Provisions of the Economic Solvency Regime include, among other things, transitional provisions for the Transitional Period, where under one of the following alternatives may be selected:

1. Gradual transition to the capital requirement until 2024 (hereinafter the "Transitional Period"), such that the capital requirement shall increase gradually by 5% per year, starting with 60% of the SCR in 2017 up to the full SCR amount in 2024.
1. Increasing the eligible capital by deducting from the insurance reserves an amount as detailed Section 3.3.2 below. The deduction will decrease gradually until 2032 (hereinafter - the "Deduction during the Transitional Period"). Furthermore, the Deduction Amount may be revised during the Transitional Period due to other changes in accordance with the provisions pertaining to the actions taken by the insurance company in the Transitional Period, as set in a letter of October 15, 2020 regarding Principles for the Calculation of Deduction During the Transitional Period in A Solvency-II Based Economic Solvency Regime" (hereinafter - the "Letter of Principles").

The Company opted for the second alternative after receiving the Commissioner's approval, as required.

1.3.1 Revising the Deduction Amount in subsequent periods

In accordance with the principles for the calculation of Deduction during the Transitional Period in an economic solvency regime based on Solvency II, and the provisions for the application of an economic solvency regime, the Deduction Amount will be recalculated every two years, or at least, if there is a material change, the risk profile or the business structure of the insurance company, and in accordance with the Commissioner's requirements, if he believed that circumstances changed since then. The Company has recalculated the Deduction Amount as of December 31, 2024, and obtained the Commissioner's approval for the recalculation and for a deduction equal to NIS 3,353 million before the Deduction – see Section 1.5.3 below.

1.4 Definitions
The Company -	Clal Insurance Company Ltd.
The Commissioner -	Commissioner of the Capital Market, Insurance and Savings Authority.
Provisions of the Economic Solvency Regime -	Insurance Circular 2020-1-15 "Amendment to the Consolidated Circular concerning Implementation of a Solvency II-Based Economic Solvency Regime for Insurance Companies" and related guidance by the Commissioner regarding the implementation of economic solvency regime.
Eligible shareholders' equity/ economic capital -	Total Tier 1 capital and Tier 2 capital of an insurance company, after deductions and amortization in accordance with the Provisions of the Economic Solvency Regime.
Basic Tier 1 capital -	Excess of assets over liabilities, estimated according to the provisions regarding economic balance sheet, comprising the following components: Issued and paid up ordinary share capital, premium paid upon the issuance of shares, retained earnings, capital reserves net of debit capital reserves, and the change in excess assets over liabilities arising from differences in the methods employed to measure the assets and liabilities according to the Directives (reconciliation reserve), net of: Unrecognized assets, buyback of ordinary shares, and dividend declared subsequent to the report date.
Additional Tier 1 capital -	The total of all of the above, when their value is measured according to the Provisions of the Economic Solvency Regime - perpetual capital note, non cumulative preferred shares, Additional Tier 1 capital instrument, restricted Tier 1 capital instrument.
Tier 2 capital -	Tier 2 capital instruments, Subordinated Tier 2 capital, Hybrid Tier 2, and Hybrid Tier 3 capital instruments - valued in accordance with the Provisions of the Economic Solvency Regime.
Solvency capital requirement (SCR) -	The capital requirement from an insurance company to maintain its solvency, calculated in accordance with the Provisions of the Economic Solvency Regime.
Basic solvency capital requirement (BSCR) -	The capital requirement from an insurance company to maintain its solvency, calculated in accordance with the Provisions of the Provisions of the Economic Solvency Regime Directives, without taking into account the capital requirement due to operational risk, loss absorption adjustment due to deferred tax and capital requirement due to management companies.
Solvency ratio -	The ratio between the eligible shareholders' equity and the solvency capital requirement.
Best estimate -	Expected future cash flows from insurance contracts and insurance contracts throughout their term, without conservatism margins and discounted by an adjusted risk-free interest.
Risk margin -	An amount added to the best estimate amount that reflects the total cost of capital that is expected to be required from another insurance company or reinsurer in order to assume the Company's insurance liabilities, calculated according to the Provisions of the Economic Solvency Regime.
Deduction during the Transitional Period	The amount deducted from insurance reserves during the Transitional Period, calculated in accordance with the provisions of Section 4(c) to the Provisions of the Economic Solvency Regime. The Deduction will decrease gradually until 2032.
Non-eligible asset -	An asset held against liabilities that are not yield-dependent contrary to the Investment Rules Regulations, or contrary to the Commissioner's Directives, net of the tax reserve created in respect thereof.
Minimum capital requirement (MCR) -	Minimum Capital Requirement - the minimum capital requirement from an insurance company, calculated in accordance with the Provisions of the Economic Solvency Regime
Expected profits in future premiums (EPIFP) -	Expected Profits in Future Premiums - the expected profit in future premiums (retention) included in the insurance liabilities, in respect of premiums that have not yet been received through the report date.

UFR -	Ultimate Forward Rate - the latest forward interest rate derived from the expected long-term real interest rate and the long-term inflation expectations to which the adjusted interest rate curve converges, in accordance with the Provisions of the Economic Solvency Regime.
Volatility adjustment (VA) -	Volatility adjustment is an anti-cyclical component reflecting the margin implicit in a representative debt assets portfolio of insurance companies and added to the adjusted interest rate curve in accordance with Provisions of the Economic Solvency Regime.
SLT long term health insurance -	Health insurance that is conducted similarly to life insurance.
Short-term health insurance (non-similar to life techniques - NSLT) -	Health insurance that is conducted similarly to P&C insurance.
Effect of diversification of	The effect of diversification is the difference between a simple sum of the risk
risk-weighted components -	weighted components and a sum that takes into account the partial correlation between them, the effect of diversification is the difference between a simple sum of the risk-weighted components and a sum that takes into account the partial correlation between them. The greater the diversification among operating segments in the portfolio and risk-weighted components, the greater the effect of diversification on the reduction of the overall risk.
The Authority -	The Capital Market, Insurance and Savings Authority.
Investment Rules Regulations -	Supervision of Financial Services Regulations (Provident Funds) (Investment Rules Applicable to Institutional Entities), 2012.

1.5 Calculation methodology

1.5.1 General

The Provisions of the Economic Solvency Regime set guidance regarding an economic calculation of the eligible shareholders' equity and the solvency capital requirement. Set forth below are the key points of the provisions and the changes therein:

1.5.2 Economic balance sheet

In accordance with the Provisions of the Economic Solvency Regime, in general, the economic balance sheet line items are measured according to economic value, and specifically, the insurance liabilities are calculated based on the best estimate of all expected future cash flows from existing businesses, without conservatism margins. This is plus a risk margin, that reflects the total cost of capital that is expected to be required from another insurance company or reinsurer in order to assume the Company's insurance liabilities in the economic balance sheet. According to the provisions, the risk margin is calculated using the cost of capital method, at a rate of 6% per year of the expected capital requirement in respect of insurance risks over the life of the existing businesses, as follows:

The economic balance sheet is prepared based on the Company's separate financial statements plus investees, whose sole occupation is holding rights in real estate properties, plus subsidiary insurance companies, whose data are consolidated with those of the insurance company, and - according to the guidance - does not include the economic value of the provident funds activity and pension funds activity under the insurance company. The economic balance sheet attributes zero value to deferred acquisition costs and intangible assets (excluding the investment in "Insurtech," as defined in the Solvency Circular, according to the approval that the Company has received from the Commissioner in that respect).

1.5.3 Increasing economic capital according to the transitional provisions

As aforesaid, the Company opted for the current alternative provided by the Transitional Provisions, whereby the economic capital may be increased by gradually deducting from the insurance reserves due to the Deduction Amount, will be deducted gradually, until 2032 (hereinafter - the "Deduction during the Transitional Period" or the "Deduction during the Transitional Period"). Pursuant to the Letter of Principles, the Deduction during the Transitional Period shall be calculated by dividing insurance policies

issued through December 31, 2016 into homogeneous risk groups. The aforesaid deduction shall be calculated as the difference between insurance reserves (retention) as per the economic balance sheet including the risk margin attributed thereto (net of adjusting the fair value of designated bonds) and the insurance reserves (retention) as per the Financial Statements. This difference shall be deducted on a linear basis until December 31, 2032.

The Deduction during the Transitional Period shall be recalculated in subsequent periods in the following instances:

A. Every two years, after obtaining the Commissioner's approval.
B. If a material change occurred in the risk profile or the business structure of the insurance company.

C. At the request of the Commissioner, if he/she believed that circumstances have changed since approval was given.

Furthermore, the Deduction Value During the Transitional Period shall be proportionate to the expected increase in the solvency ratio calculated excluding expedients during the Transitional Period - see Section 3.2.2 below.

Calculation of the Deduction during the Transitional Period in the economic solvency regime under IFRS 17

On April 10, 2025, the Commissioner issued guidance regarding the calculation of the Deduction Amount after the application of IFRS 17 (starting from the Solvency Ratio Report as of June 30, 2025). In accordance with the guidance, the ratio between the calculated Deduction Amount as of December 31, 2024 and the amount of BE and RM components less the addition of the value of Hetz bonds (for a guaranteed return portfolio) should be calculated for each homogeneous risk group (hereinafter - the "Deduction Rates").

After the application of IFRS 17, the Deduction Amount will be determined by multiplying the Deduction Rates calculated as of December 31, 2024 for each homogeneous risk group, by the amount of the BE and RM components less the addition of the value of Hetz bonds (for a guaranteed return portfolio) as of the calculation date.

The maximum deduction for each reporting period will be equal to the Deduction Amount of all homogeneous risk groups, amortized, on a straight line basis, between December 31, 2019 and the end of 2032.

1.5.4 Solvency capital requirement (SCR)

The calculation of the solvency capital requirement is based on an assessment of the economic shareholders' equity's exposure to the risk-weighted components set in the Provisions of the Economic Solvency Regime: life insurance risks, health insurance risks, property and casualty insurance risks, market risks and counter-party default risks. These risk-weighted components include sub-risk-weighted components with respect to specific risks to which the insurance company is exposed. The exposure assessment of the economic shareholders' equity to each sub-risk-weighted component is carried out based on a defined scenario set out in the Provisions of the Economic Solvency Regime. The determination of the solvency capital requirement is based on the sum of the capital requirements in respect of the riskweighted components and risk-weighted sub-components, as stated above, in accordance with the partial correlations assigned to them. The calculation of the solvency capital requirements also includes calculation of the capital requirement for operational risk and operational risk-weighted capital requirements in respect of management companies, net of the loss absorption adjustment due to deferred tax, as detailed by the Provisions of the Economic Solvency Regime.

The capital requirements in respect of each of the risks are calculated in accordance with the Company's exposure to that risk, taking into account the parameters set in the Directives. The capital requirement represents, in accordance with the Directives, the shareholders' equity that will allow the insurance company to absorb unexpected losses in the forthcoming year and meet its obligations to policyholders and beneficiaries on time, with a 99.5% certainty level.

The loss absorption adjustment with respect to deferred tax assets beyond the balance of the deferred tax reserve as per the economic balance sheet is limited to 5% of the basic solvency capital requirement (BSCR), provided that the following conditions are met:

• The insurance company is able to demonstrate to the Commissioner that it is probable that it will have future taxable income against which the tax assets may be utilized.

• Future income will arise only from property and casualty insurance or from Not Similar to Life Techniques (NSLT) health insurance.

It should be emphasized that the results of the models used in the calculation of the eligible shareholders' equity and the solvency capital requirement are highly sensitive to the forecasts and assumptions included therein, as well as to the manner by which the Provisions of the Economic Solvency Regime are implemented. The economic solvency ratio is highly sensitive to market variables and other variables, and accordingly may be volatile.

1.5.4.1Disclosure provisions

In accordance with the updated instructions of the consolidated circular on "public reporting" – the disclosure includes the results of the following sensitivity tests:

A 50 basis points decrease in the interest rate curve; a 25% decrease in the value of equity assets; a 5% increase in morbidity rates; a 5% decrease in mortality rates; and a 10% increase in cancellation rates. In addition, the report includes a breakdown of the movements in the capital surplus.

1.6. Comments and clarifications

1.6.1 General

The Economic Solvency Ratio Report includes, among other things, forecasts based on assumptions and parameters based on past experience, as they arise from actuarial studies conducted from time to time, and on Company's assessments regarding the future, to the extent that it has relevant and concrete information which can be relied upon. The information and studies are similar to those used as the basis for the Company's annual 2024 report. Any information or studies obtained subsequent to the publication date of the Company's Annual Report for 2024 were not taken into account.

This Solvency Ratio Report was prepared based on the conditions and the best estimate as they were known to the Company as of December 31, 2024.

It should also be emphasized that, among other things, in view of the reforms in the capital, insurance and savings market and the changes in the business and economic environment, past data are not necessarily indicative of future results, and the Company is unable to reliably assess these effects. The calculation is sometimes based on assumptions regarding future events and steps taken by management, that will not necessarily materialize or will materialize in a manner different than the assumptions used in the calculation. Furthermore, actual results may materially vary from the calculation, since the combined scenarios of events may materialize in a manner that is materially different than the assumptions of the model.

The model, in its present form, is highly sensitive to changes in market variables and other variables, and specifically changes in the interest rate curve; therefore, the solvency ratio reflected therefrom may be very volatile.

1.6.2 Future effects of legislation and regulatory measures known as of the report's publication date and exposure to contingent liabilities

1.6.2.1. The insurance sector has been subject to frequent changes in relevant legislation and frequent regulatory guidance. Legislation and regulatory measures affect the Company's profitability and its cash flows and consequently - its economic solvency ratio.
1.6.2.2. The calculation of the solvency ratio does not reflect all potential effects of the aforesaid legislation and regulatory measures and of other developments that are not yet reflected in practice in the data; this is since to date the Company is unable to assess their entire effect on its business results and solvency ratio.
1.6.2.3. For details about key regulatory changes, the future effect of which is highly uncertain, see, among other things, Sections: 2.5.2, 2.5.3, 2.5.4, 2.5.5, 2.5.6, 6.2, 7.1.1, 8.1.2.1, 8.1.2.2, 8.2 in the Company's Report on the Corporation's Business as of December 31, 2024, and in Section 4 to the Company's Report of the Board of Directors as of March 31, 2025.
1.6.2.4. In accordance with the Provisions of the Economic Solvency Regime, the value of contingent liabilities in the economic balance sheet is determined based on their value in the accounting balance sheet in accordance with the provisions of IAS 37; this measurement does not reflect their economic value. For information regarding the exposure to contingent liabilities and its measurement, see Note 38 to the Company's Consolidated Financial Statements for 2024 and Note 9 to the Consolidated Interim Financial

Statements as of March 31, 2025, and immediate reports published as from that date. The settlement or extinguishment of these contingent liabilities may involve amounts, which are materially higher than their amounts as per the economic balance sheet. It is impossible to assess the effect of the uncertainty arising from the exposure to contingent liabilities described.

1.6.2.5. On July 12, 2023, an Amendment to the Income Tax Regulations (Rules for Approval and Management of Provident Funds), 1964 was published, which prescribes that the employer and employee contributions into an annuity provident fund, which is an insurance fund, will be capped to that portion of the wage that exceeds double the average wage in Israel (hereinafter - the "Monthly Contribution Cap"), provided that the portion up to the Monthly Contribution Cap will be deposited with an annuity provident fund which is not an insurance fund. Furthermore, on July 12, 2023, an amendment to the Supervision of Financial Services Regulations (Provident Funds) (Transfer of Funds between Provident Funds), 2008 was published, which limits the transfer of funds from a provident fund, which is not an insurance fund, to an insurance fund, such that the balance of accrued funds which were not transferred shall be equal to the product of the Monthly Contribution Cap multiplied by the number of months that have elapsed since the first contribution was made to the provident fund. The effective date of the above regulations is September 1, 2023. As of this date, the effect of the amendment has led to higher-than-expected increase in transfers in executive policies and a decrease in the Company's solvency ratio.
1.6.2.6. In June 2023, the Economic Plan Law (Legislative Amendments for Implementing Economic Policies for the Budget Years 2023 and 2024), Chapter S (Health) (hereinafter - the "Economic Arrangements Law") was published, which amends The Financial Services Supervision Law, and sets a requirement whereby an insurer will pay the health maintenance organization for a surgical procedure executed and financed through a SHABAN plan when the conditions prescribed by the Law are met. Furthermore, transitional provisions were set that will require the insurer to transfer policyholders from an individual "From the First Shekel" surgical procedure policy taken out as from February 2016, who also have a SHABAN plan in place, to a "Supplementary SHABAN" surgical procedures policy, while ensuring continuous insurance coverage on June 1, 2024. In addition, it was determined that policyholders will be allowed to inform the insurer - within a year of the transfer date - of their wish to cancel the transfer and reinstate the original policy. The Company approved new tariffs for "From the First Shekel" and "Supplementary SHABAN" policies, and is acting in accordance with the Provisions for the Transitional Period, which were set. As of the date of this report, the Company estimates that the implementation of this law is not expected to have a material effect on the Company's solvency ratio.
1.6.2.7. In March 2024 an amendment was approved by the Knesset plenum to the Value Added Tax Ordinance (Tax Rate for Non-Profit Organizations and Financial Institutions), 2024 (hereinafter the "Ordinance"), which prescribes that as from January 1, 2025 the rate of VAT and rate of payroll tax applicable to financial institutions will stand at 18% of the wage paid for work, and the profit tax shall stand at 18% of the profit generated. The revision of the tax rate did not have a material effect on the solvency ratio. It is noted that the tax rate change will broadly affect the economy, which will be reflected in changes in market variables, especially in inflation, interest and yield curves as well as in the Company's expense rate. These effects are expected to affect the Company's solvency ratio in opposite ways; the Company estimates that the total change will not materially affect the solvency ratio.
1.6.2.8 We note that with regard to the new accounting standard (IFRS 17), which will applied in Israel as from January 2025, there is still some uncertainty, primarily regarding the lack of clarity regarding taxation. For further details, see Note 11 to the Interim Financial Statements as of March 31, 2025.
1.6.2.9. In July 2024, the Commissioner published an amendment to the Provisions of the Consolidated Circular regarding Measurement of Liabilities - Revising the Demographic Assumptions in Life Insurance and Pension Funds" (hereinafter - the "Circular"). The provisions of the Circular include a revision of the default demographic assumptions used to calculate liabilities and coefficients in Life Insurance policies and pension funds. Revision of retirees' mortality tables led to a decrease in capital and solvency ratio.

2. Economic solvency ratio and minimum capital requirement (MCR)

2.1 Solvency ratio

	As of December 31, 2024	As of December 31, 2023
In NIS thousand	Audited(*)	Audited(*)
Shareholders' equity in respect of SCR - see Section 4	14,705,646	14,019,290
Solvency capital requirement (SCR) - see Section 5	9,623,568	8,975,784
Surplus	5,082,078	5,043,506
Economic solvency ratio (in %)	153%	156%

Effect of material equity transactions taken in the period between the calculation date and the publication date of the Economic Solvency

Ratio Report:
Raising (redemption) of equity instruments (**)	500,000	291,524
Shareholders' equity in respect of SCR	15,205,646	14,310,814
Surplus	5,582,078	5,335,030
Solvency ratio (in %)	158%	159%

(*) Any reference made in this report to the term "audited", shall be construed as an audit held in accordance with International Standard on Assurance Engagements No. 3400 - The Examination of Prospective Financial Information.

(**) Subsequent to the reporting date, on April 24, 2025, Bonds (Series 14) were issued for a total of approx. NIS 500 million.

For details regarding the solvency ratio without applying the Provisions for the Transitional Period and regarding the target solvency ratio and restrictions applicable to the Company in connection with dividend distribution, see Section 10 below.

Key changes in the capital surplus and in the economic solvency ratio compared to last year:

The application of the Stochastic Model resulted in a substantial increase in capital and capital surplus, as explained below.
Financial effects resulted in an increase in the capital surplus and in the economic solvency ratio.
The expiry of the risks arising from a previously sold insurance activity in the field of life and health insurance led to an increase in the economic capital and a decrease in the capital requirements and the risk margin, and overall - to an increase in the capital surplus and solvency ratio.
Higher cancellation rate in risk products and savings products led to a decrease in the solvency ratio.
Operating profitability in Property and Casualty Insurance resulted in an increase in capital and solvency ratio.
Revision of studies, specifically the Amendment to the Provisions of the Consolidated Circular Measurement of Liabilities - Revising the Demographic Assumptions in Life Insurance and Pension Funds resulted in a decrease of the capital and solvency ratio.
As explained above, the Company recently recalculated the Deduction as of December 31, 2024. The abovementioned revision resulted in a decrease in shareholders' equity in respect of SCR.
For details regarding the dividend declared subsequent to the reporting date, see Section 10.1 below.

Implication of the Iron Swords War

In October 2023, the Iron Swords War broke out (hereinafter - the "War") in the State of Israel. It is noted that there is substantial uncertainty regarding the further development of the War, its scope and duration. In addition, there is uncertainty as to the impact of the War on fluctuations in the financial markets, including, among other things, with regard to the risk-free interest rate curve and the inflation rate, which continued in the period between the calculation date of the Company's solvency ratio as of December 31, 2024 and the publication date. Accordingly, there is significant uncertainty regarding the future effects of the War on The Company's solvency ratio.

For more information about the consequences of the Iron Swords War, see Note 39 to the Company's Consolidated Financial Statements for 2024 and the Report of the Board of Directors for the period ended December 31, 2024, as well as Note 8 to the Consolidated Interim Financial Statements as of March 31, 2025.

Update regarding the use economic scenario generators in the calculation of the Company's economic solvency ratio

As explained in Section 3.1.1. Following is the calculation of the insurance liabilities was carried out in accordance with the Provisions of the Economic Solvency Regime; generally, in relation to life and SLT health insurance liabilities, the calculation was carried out in accordance with EV calculation practice in Israel.¹ The determination of the best estimate should be based on an estimation of the distribution of the potential best estimates ("Stochastic Models"), and in the absence of significant statistical data that will allow the assessment of the distribution probability of the best estimate, the Company used the expected value of each relevant factor ("Deterministic Models").

In accordance with an outline received from the Commissioner in November 2023, the Stochastic Model will not be implemented in the calculation of the solvency ratio without implementing the Transitional Provisions - over 3 reporting dates - but the Company will disclose its effects in the Economic Solvency Ratio Report. At this stage, the Company opted not to include this in the calculation that takes into consideration the Transitional Provisions.

In this report, the Company completed the stochastic calculation of the best estimate of the asymmetrical insurance liabilities cash flows (including carrying future management fees) based on an economic scenario generator,2 including the implementation of tests and control processes regarding the accuracy, robustness, and market consistency, as is the normal practice in foreign companies that implement stochastic models in the calculation of their economic solvency ratio. The Stochastic Model is used to calculate the optimal actuarial estimate of asymmetric insurance liabilities (including recognition of future variable management fees). With the Stochastic Model, the return used as a basis for the calculation remains unchanged compared to the Deterministic Model. However, the calculation of the cash flows in the Stochastic Model takes into account the volatility in the returns on the relevant assets according to their composition and characteristics, including the investment channels, average duration and exposure to the index and exchange rates of foreign currencies, and their effect on the charging of variable management fees. In order to create the Stochastic Model, the Company selected economic models that match its asset classes. As part of the process of selecting and calibrating those economic models, the Company was supported by international consultancy firms. In addition, the independent auditors reviewed the calculation process and the internal control.

2.2 Minimum capital requirement (MCR)

	As of December 31, 2024	As of December 31, 2023 Audited
In NIS thousand	Audited
Minimum capital requirement (MCR) - see Section 6.1.	2,405,892	2,243,946
Shareholders' equity for MCR - see Section 6.2	10,975,011	10,271,712

^1. EV (embedded value) is calculated in Israel in accordance with the rules and principles set by the Commissioner, who adopted the rules and principles of the report of the joint committee of insurance companies and the Commissioner, which worked with the guidance of consultants from Israel and abroad.

^2. As defined in the provisions of Section B, Chapter 5 (Part 2, Section 2) of the Provisions of the Economic Solvency Regime.

3. Economic balance sheet

		As of December 31, 2024		As of December 31, 2023
	Extension	Balance sheet according to accounting standards (*)	Economic balance sheet	Balance sheet according to accounting standards	Economic balance sheet
NIS thousand	clause	Audited	Audited	Audited	Audited
Assets:
Intangible assets	3	812,422	63,428	798,905	91,085
Deferred acquisition costs	4	1,973,325	-	1,941,135	-
Property, plant & equipment	8	156,806	140,427	166,395	146,102
Investments in investees that are not insurance companies:
Management companies	5	872,436	340,469	842,972	310,001
Other investees	5	71,718	72,525	72,148	68,936
Total investments in investees that are not
insurance companies		944,154	412,994	915,120	378,937
Investment property in respect of yield dependent contracts		3,924,263	3,924,263	3,838,728	3,838,728
Investment property - other		1,516,807	1,516,807	1,493,689	1,493,689
Reinsurance assets		3,830,398	2,972,667	3,805,186	3,023,560
Receivables and debit balances	13	1,460,588	1,460,588	2,916,133	2,916,133
Financial investments in respect of yield dependent contracts		88,801,636	88,801,636	84,133,182	84,133,182
Other financial investments:
Liquid debt assets		6,086,397	6,086,397	6,321,705	6,321,705
Illiquid debt assets, excluding designated bonds	6	8,291,659	8,489,359	7,693,941	7,729,624
Designated bonds	7	14,739,198	19,153,651	14,441,158	19,346,207
Shares		1,735,344	1,735,344	1,645,575	1,645,575
Other		5,794,262	5,794,262	5,646,414	5,646,414
Total other financial investments		36,646,860	41,259,013	35,748,793	40,689,525
Cash and cash equivalents in respect of yield
dependent contracts		4,451,179	4,451,179	4,417,868	4,417,868
Other cash and cash equivalents		1,752,135	1,752,135	1,784,047	1,784,047
Other assets	14	322,406	565,068	328,019	602,389
Total assets		146,592,979	147,320,205	142,287,200	143,515,245
Total assets in respect of yield dependent contracts		97,980,751	98,061,644	94,008,373	94,073,890

3. Economic Balance Sheet (cont.)

		As of December 31, 2024		As of December 31, 2023
		Balance sheet		Balance sheet
	Extension	according to accounting standards (*)	Economic balance sheet	according to accounting standards	Economic balance sheet
NIS thousand	clause	Audited	Audited	Audited	Audited
Equity:
Basic Tier 1 capital		7,326,980	10,388,393	6,782,295	9,425,233
Total equity		7,326,980	10,388,393	6,782,295	9,425,233
Liabilities:
Liabilities in respect of insurance contracts and non yield-dependent investment contracts	1, 10	32,239,883	26,651,901	31,705,888	28,046,483
Liabilities in respect of insurance contracts and yield dependent investment contracts	1, 10	95,884,875	92,765,561	91,674,816	89,914,670
Risk margin (RM)	9	-	6,984,837	-	6,865,632
Deduction during the Transitional Period	2	-	(2,063,487)	-	(4,115,103)
Liabilities in respect of deferred taxes, net	11	705,437	2,618,955	559,577	2,212,347
Payables and credit balances	13	4,907,321	4,785,125	6,076,610	5,958,647
Financial liabilities	12	5,132,395	4,674,715	5,093,716	4,661,328
Other liabilities	14	396,088	514,205	394,298	546,008
Total liabilities		139,265,999	136,931,812	135,504,905	134,090,012
Total equity and liabilities		146,592,979	147,320,205	142,287,200	143,515,245

*) Prior to the application of IFRS 17 and IFRS 9, the effect of which was included in the Financial Statements as of March 31, 2025 for the December 31, 2024 figures.

Main Changes in relation to previous year:

For explanations regarding main changes in Tier 1 capital and significant effects on the economic solvency ratio's components, see Sections 2.1 and 3 below.

3.1 Information about economic balance sheet

The fair value of assets and liabilities in the economic balance sheet was calculated in accordance with the provisions included in the chapter dealing with measurement of assets and liabilities for financial statements purposes in the Consolidated Circular (Chapter 1, Part 2 of Section 5) (hereinafter - the "Measurement Chapter in the Consolidated Circular"), except for items for which other provisions apply as per Part A of the Economic Solvency Regime, as follows:

3.1.1 Extension Clause 1 - Total liabilities in respect of insurance contracts and investment contracts

The insurance liabilities were calculated based on a best estimate, on the basis of assumptions that are mainly a result of projecting to the future existing experience relating to past events, within the environment in which the Company operates, and without conservatism factors. The calculation of the insurance liabilities was carried out in accordance with the Provisions of the Economic Solvency Regime; generally, in relation to life and SLT health insurance liabilities, the calculation was carried out in accordance with EV calculation practice in Israel,³ and in relation to property and casualty insurance, it was carried out based on the part in the Measurement Chapter in the Consolidated Circular, which refers to best estimate.

^3. EV (embedded value) is calculated in Israel in accordance with the rules and principles set by the Commissioner, who adopted the rules and principles of the report of the joint committee of insurance companies and the Commissioner, which worked with the guidance of consultants from Israel and abroad.

The measurement of the insurance liabilities in the economic balance sheet is carried out by discounting the projected cash flows, including future income, by a risk-free interest plus VAT and taking the UFR into consideration, on the basis of a best estimate that does not include conservatism margins, where the risk is reflected in the RM component, which is a separate liability. This measurement differs from the measurement applied in the financial statements, where insurance liabilities are estimated with conservatism margins using the discounting methods and rates described in Note 35 to the Company's 2024 annual financial statements.

The calculation of the liabilities in respect of life insurance contracts and long term health insurance (SLT) contracts was carried out by discounting the Company's estimated future cash flows using a model applied to information available in the Company's operational systems as to insurance coverages. The assumptions used in the model include, among other things, assumptions in respect of cancellations, operating expenses, mortality and morbidity, and they are set based on past experience and other relevant studies.

The calculation of the liabilities does not include cash flows in respect of future sales; however, it does include an assumption that the Company will continue receiving premiums from existing businesses (excluding in respect of policies without an insurance risk, including investment contracts). Furthermore, the calculation assumes that the Company shall continue as a going concern, i.e., that the Company's structure will not change, and therefore, some of the fixed expenses in the future shall not be allocated to the current portfolio, but rather to a new business which is expected to be sold in the future.

It is likely that the actual cash flows will vary to some degree on another from the estimates made on a best estimate basis, even if the underlying parameters of the calculation will not change in any way. See also Section 1.6 above.

3.1.1.1 Limitations and qualifications with regard to calculation of the best estimate

3.1.1.1.1 Generally, the underlying assumptions of the models were formulated mainly on the basis of studies and analyses which are based on Company's experience over the past few years, which did not include extreme events. Therefore, there is a possibility of extreme scenarios, the probability of the occurrence of which is very low and cannot be estimated by the Company, and the effects of which cannot be estimated by the Company. Such events were not taken into account in the determination of the models' underlying assumptions.
3.1.1.1.2 Since the Company did not have sufficient data, when calculating the BE it did not check the level of correlation between demographic and operational assumptions and assumptions pertaining to market conditions (such as the interest rate), which may materially affect the BE.
3.1.1.1.3 The determination of the BE should be based on an estimation of the distribution of the potential BEs. With no available significant statistical data that can be used to evaluate the distribution of BE for all demographic and operational factors in life and health SLT, the Company used real assumptions for each and every parameter, according to the expected value of each relevant factor, except for that which is stated inSection 2.1 above regarding the application of a stochastic calculation to the best estimate of the insurance liabilities flows (including stating future variable management fees) as from the December 31, 2024 calculation, without taking into account any correlation or dependency between the different assumptions, or between the assumptions and external economic parameters such as taxation, interest or employment levels in Israel.
3.1.1.1.4 In many cases, thefuture cash flows referto periods of tens of years into the future. The underlying assumptions of the cash flows rely are based on studies, mainly in accordance with recent years' experience, and management's best knowledge. It is highly uncertain whether the underlying cash flow assumptions will, indeed, materialize.
3.1.1.1.5 In that context, it should be emphasized that the stress scenarios calculated as part of the solvency model (the standard model) and the correlations on which the model for capital requirements is based, were defined by the Commissioner, and do not reflect the Company's actual experience.

3.1.1.2 Assumptions underlying the insurance liabilities calculation

3.1.1.2.1 Manner of determining the assumptions

The calculation's underlying assumptions were set in accordance with the Company's best estimates of relevant demographic and operational factors, and reflect the Company's expectations as to the future in respect of these factors. The demographic assumptions

included in the calculation were taken from Company's internal studies, if any, and conclusions reached as a result of exercising professional judgment, based on relevant experience and the integration of information received from external sources, such as information from reinsurers and mortality and morbidity tables published by the Commissioner.

The operational assumptions (general and administrative expenses) were calculated in accordance with the results of the Company's internal pricing model applied to expenses relating to the relevant insurance liabilities, including: allocation of expenses to the various segments and activities (issuance, current management, investments, etc.) and assumptions regarding their future development (in accordance with the CPI, scope of premiums and assets under management, etc.).

Set forth below are the key assumptions on which the Company relied in the calculations:

3.1.1.2.2 Economic assumptions

Discount rate adjusted risk-free interest rate curve for solvency. This curve is based on the yield to maturity of bonds of the Government of Israel (hereinafter - "risk-free interest rate"), up to the last liquidity point in the 10th year (hereinafter - "LLP"), with convergence in the long-term to a real fixed rate of 2.6% (UFR) plus a margin (VA), which is calculated by the Authority - all as set by the Commissioner.
The yield on the assets backing the yield-dependent life insurance products is identical to the discount rate.
Designated bonds estimated in accordance with their fair value, which takes into account their interest rate and the best estimate as to the Company's future entitlement to purchase them.
The inflation rate is set as the difference between the yield to maturity curve on NIS government bonds and the yield to maturity curve on linked government bonds. It is noted that the inflation assumption is relevant to products with amounts of insurance, premiums, and/or CPI-linked interest rates, and to expenses for claims and/or premiums that the Company assumes will change according to the rate of the CPI or another CPI-linked rate.

3.1.1.2.3 Operational assumptions (forlife and health insurance)

• General and administrative expenses - the Company analyzed the expenses allocated in the financial statements to the relevant insurance segments, and allocated them to various products and coverage types and to various activities such as current operating of the coverages, investment management, handling claims, payment of pensions, etc. The expenses study is revised periodically and the different types of expenses are carried to the future cash flow in relation to the relevant factors, such as the number of coverages, premiums, reserves or claims. The determination of the future expenses and their allocation to future cash flows include many assessments and judgments by the Company, which affect the amount of the liabilities.

3.1.1.2.4 Demographic assumptions

Cancellations (discontinuation of premium payment, settlement of policies, withdrawals)
Mortality of pensioners and planholders
Morbidity (rate and length of claims) in long-term care, PHI and health products
Takeup rates, retirement age distribution and pension tracks
Real wage increase
Conservation assumptions

3.1.1.2.5 Assumptions underlying property and casualty insurance

The cost of claims in respect of future damages and damages that had already occurred but claims for which have not yet been paid - based on the Company's past experience in the different subsegments in connection with the rate of claims, the amounts of claims, and the rate of claim payouts in long-tail subsegments.

3.1.2 Extension Clause 2 - Deduction during the Transitional Period

In accordance with the provisions of the Economic Solvency Regime, as described above in Chapter C – Calculation Methodology, and following the change in risk-free interest rate curve, the Company has recalculated the value of the Deduction as of December 31, 2024, as the sum of the positive differences between the insurance reserves (retention) in the economic balance sheet, including the risk margin (less the adjustment to the fair value of designated bonds), and the insurance reserves (retention) according to the financial statements as of that date, after having obtained the Commissioner's approval for this, as required. These differences were calculated at product group level in accordance with the provisions included in the Letter of Principles, after receiving the required approval from the Commissioner.

The said deduction is amortized linearly for 13 years up to December 31, 2032, such that amortized balance as of December 31, 2024 is NIS 2,063 million.

In accordance with the Letter of Principles, the Company assessed the need to reduce the value of the reduced Deduction balance, which is deducted to reflect the expected increase in the solvency ratio, calculated without the Deduction. Accordingly, the Company did not deem it necessary to amortize the value of the amortized deduction balance as of December 31, 2024.

The future Deduction during the Transitional Period is subject to the above changes in assumptions, the developments of the businesses and a periodic approval by the Commissioner.

3.1.3 Extension Clause 3 - Intangible assets

An insurance company shall assess the value of intangible assets at zero, except for investment in Insurtech as defined in the Solvency Circular, for which it obtained the Commissioner's approval, as required.

3.1.4 Extension Clause 4 - Deferred acquisition costs

Valued at zero, consistently with the assessment of the insurance liabilities as described in Section (1) above.

3.1.5 Extension Clause 5 - Investment in investees that are not insurance companies

Investees that are not insurance companies are valued in accordance with the adjusted equity method. That is to say, the proportionate share of the insurance company in the excess of assets over liabilities of the investee, without taking into consideration intangible assets. In management companies of pension and provident funds, 35% of the balance of the goodwill that has arisen upon acquisition was added to the economic value. The economic value of the investees does not include the profits implicit in those companies.

3.1.6 Extension Clause 6 - Illiquid debt assets other than designated bonds

Presented at fair value in the economic balance sheet in accordance with the principles set out in Note 14(F) to the Company's annual financial statements.

3.1.7 Extension Clause 7 - Designated bonds

Estimated in accordance with their fair value, which takes into account their interest rate and the best estimate as to the Company's future entitlement to purchase them, based on the assumptions used in the calculation of the best estimate of the insurance liabilities in respect of which the Company is entitled to designated bonds.

3.1.8 Extension Clause 8 - Property, plant, and equipment

Assets for which there is an active market, revalued in accordance with the fair value. Assets for which there is no active market in the Company's opinion are valued at zero.

3.1.9 Extension Clause 9 - Risk margin

In addition to the insurance liabilities based on an best estimate, a component of the risk margin is calculated which reflects the total cost of capital that another insurance company would be expected to require in order to receive the insurance company's total insurance liabilities, calculated on the basis of an best estimate. The risk margin is calculated in accordance with the Commissioner's Directives, based on a capital cost rate of 6%, and is discounted at an adjusted risk-free interest rate, but excluding the VA component. The future capital requirement is calculated in accordance with the "risk factor method", by changing the capital requirement components calculated as of the reporting date in accordance with the projected development of the risk factors attributed thereto. These factors are designed to reflect the development of the standard

model risks over time. The calculation does not take into account the capital requirement in respect of market risks.⁴

3.1.10 Extension Clause 10 - Contingent liabilities

As to the value of contingent liabilities in the economic balance sheet, see Section 1.6.2.4 above.

3.1.11 Extension Clause 11 - Liabilities in respect of deferred taxes, net

The calculation is based on the difference between the value attributed to assets and liabilities in the economic balance sheet, including in respect of the Deduction Amount, and the value attributed to those assets and liabilities for tax purposes, in accordance with the recognition, measurement and presentation provisions of IAS 12. Deferred tax assets may be recognized only if the Company shall meet the criteria included in the guidance, in addition to the criteria included in the abovementioned accounting standard.

3.1.12 Extension Clause 12 - Financial Liabilities

Revalued in accordance with risk-free interest plus the margin on issuance date, without recognizing changes in the Company's credit risk.

3.1.13 Extension Clause 13 - Other receivables and payables with average duration of less than one year

According to the guidance, the Company did not calculate fair value of items with average duration of less than one year.

3.1.14 Extension Clause 14 - Other assets and liabilities

Assets and liabilities accounted for according to IFRS 16 are revalued at fair value.

3.2 Composition of liabilities in respect to insurance contracts and investment contracts

	As of December 31, 2024
	Best estimate (BE) of liabilities
	Gross	Reinsurance	Retention
In NIS thousand	Audited
Liabilities in respect of insurance contracts and non-yield-dependent investment contracts:
SLT life insurance and long term health insurance contracts	20,079,520	(310,156)	20,389,676
NSLT short-term property & casualty insurance and health insurance contracts	6,572,381	2,656,874	3,915,507
Total liabilities for insurance contracts and non-yield-dependent investment contracts	26,651,901	2,346,718	24,305,183
Liabilities in respect of insurance contracts and yield-dependent investment contracts - SLT life insurance and long term health insurance contracts	92,765,561	625,949	92,139,612
Total liabilities in respect of insurance contracts and investment contracts	119,417,462	2,972,667	116,444,795

^4. In accordance with the guidance, it should be assumed that the acquiring company will select assets that will reduce the solvency capital requirement in respect of market risks.

	As of December 31, 2023 Best estimate (BE) of liabilities

	Gross	Reinsurance	Retention
In NIS thousand	Audited
Liabilities in respect of insurance contracts and non-yield-dependent investment contracts:
SLT life insurance and long term health insurance contracts	21,398,447	(297,086)	21,695,533
NSLT short-term property & casualty insurance and health insurance contracts	6,648,036	2,881,440	3,766,596
Total liabilities for insurance contracts and non-yield-dependent investment contracts	28,046,483	2,584,354	25,462,129
Liabilities in respect of insurance contracts and yield-dependent investment contracts - SLT life insurance and long term health insurance contracts	89,914,670	439,206	89,475,464
Total liabilities in respect of insurance contracts and investment contracts	117,961,153	3,023,560	114,937,593

Main Changes in relation to previous year:

The increase in the risk-free interest rate curve resulted in a decrease in the Company's insurance liabilities, and on the other hand actual, and positive returns in planholders' portfolios increased the Company's insurance liabilities. For more information about the changes, see Section 2.1 above.

4. Shareholders' equity in respect of SCR

In NIS thousand	As of December 31, 2024 Audited

	Basic Tier 1 capital	Additional Tier 1 capital	Tier 2 capital	Total
	Shareholders' equity	10,388,393	462,901	4,211,813
Deductions from Tier 1 capital (a)	(357,461)	-	-	(357,461)
Deductions (b)	-	-	-	-
Deviation from quantitative limitations (c)	-	-	-	-
Shareholders' equity in respect of SCR (d)	10,030,932	462,901	4,211,813	14,705,646
Of which - expected profits in future premiums (EPIFP) after tax	6,222,834			6,222,834

	As of December 31, 2023 Audited
In NIS thousand
	Tier 1 capital
	Basic Tier 1 capital	Additional Tier 1 capital	Tier 2 capital	Total
Shareholders' equity	9,425,233	464,960	4,196,368	14,086,561
Deductions from Tier 1 capital (a)	(67,271)	-	-	(67,271)
Deductions (b)	-	-	-	-
Deviation from quantitative limitations (c)	-	-	-	-
Shareholders' equity in respect of SCR (d)	9,357,962	464,960	4,196,368	14,019,290
Of which - expected profits in future premiums (EPIFP) after tax	5,947,271			5,947,271

Main Changes in relation to previous year:

Factors that supported the creation of the capital buffer

The increase in the risk-free interest rate curve resulted in an increase in the Company's Tier 1 capital.
The application of the Stochastic Model triggered an increase in the Company's Tier 1 capital.
The amortization of the cost of capital (RM) for an existing business triggered an increase in the Company's Tier 1 capital.
The sale of a new business triggered an increase in the Company's Tier 1 capital.
Operating profitability in Property and Casualty Insurance resulted in an increase in the Company's capital.

Factors that eroded the capital buffer

Higher cancellation rate in risk products and savings products led to a decrease in the Company's capital.
Revision of studies, specifically the Amendment to the Provisions of the Consolidated Circular Measurement of Liabilities - Revising the Demographic Assumptions in Life Insurance and Pension Funds resulted in a decrease of the capital and solvency ratio.
The Company recently recalculated the Deduction Amount as of December 31, 2024. The revision resulted in a decrease in shareholders' equity in respect of SCR.
(a) Amounts deducted from Tier 1 capital in accordance with the definitions of "Basic Tier 1 capital" in Appendix B, Chapter 2, Part 2 of Section 5 in the Consolidated Circular - "Economic Solvency Regime" (hereinafter - the "Economic Solvency Regime Appendix"), these deductions include the amount of assets held against liabilities in respect of non-yield-dependent insurance and investment contracts in breach of the Investment Rules Regulations, amount invested by the Company in purchasing ordinary shares of the Company, and the amount of dividend declared subsequent to the report date and through the publication of the report for the first time; see Section 10.2 below.
(b) Deductions in accordance with the provisions of Chapter 6 in Part B "Directives regarding Insurance Companies' Shareholders' Equity" to the Economic Solvency Regime Appendix.
(c) Deviation from quantitative limitations in accordance with the provisions of Chapter 2 in Part B "Directives regarding Insurance Companies' Shareholders' Equity" to the Economic Solvency Regime Appendix.
(d) Composition of shareholders equity in respect of SCR -

	As of December 31, 2024	As of December 31, 2023
In NIS thousand	Audited	Audited
Tier 1 capital:
Basic Tier 1 capital net of deductions	10,030,932	9,357,962
Additional Tier 1 capital:
Perpetual capital note and non-performing preferred shares	-	-
Additional Tier 1 capital instruments	-	-
Restricted Tier 1 capital instruments	462,901	464,960
Less deduction due to deviation from quantitative limit	-	-
Additional Tier 1 capital	462,901	464,960
Total Tier 1 capital	10,493,833	9,822,922
Tier 2 capital:
Additional Tier 1 capital not included in Tier 1	-	-
Tier 2 capital instruments	4,211,813	4,196,368
Hybrid Tier 2 capital instruments	-	-
Hybrid Tier 3 capital instruments	-	-
Subordinated Tier 2 capital instruments	-	-
Less deduction due to deviation from quantitative limit	-	-
Total Tier 2 capital	4,211,813	4,196,368
Total shareholders' equity in respect of SCR	14,705,646	14,019,290

For an explanation about key changes compared with last year see Section 4 above.

4.1 Composition of eligible capital

The Provisions of the Economic Solvency Regime set guidance regarding the composition of the eligible shareholders' equity on an economic basis, whereunder the eligible shareholders' equity shall be the total of Tier 1 capital and Tier 2 capital, as defined above:

The rate of components included in Tier 1 capital, after amortization, shall not fall below 60% of the SCR and 80% of the MCR at any time.

The rate of components included in Tier 2 capital, after amortization shall not exceed 40% of the SCR and 20% of the MCR at any time, but under the Transitional Provisions, during the period through December 31, 2032, the Tier 2 capital shall not exceed 50% of SCR.

5. Solvency capital requirement (SCR)

	As of December	As of December
	31, 2024 Audited	31, 2023 Audited
In NIS thousand	Capital requirement
Basic solvency capital requirement (BSCR):
Capital requirement in respect of market risk-weighted component	7,112,731	6,036,036
Capital requirement in respect of counterparty risk-weighted component	320,626	324,871
Capital requirement in respect of underwriting risk-weighted component in life insurance	4,167,176	4,295,539
Capital requirement in respect of underwriting risk component in health insurance (SLT+NSLT)	5,085,971	4,595,749
Capital requirement in respect of underwriting risk-weighted component in P&C insurance	1,136,628	1,028,301
Total	17,823,132	16,280,496
Effect of diversification of risk-weighted components	(5,750,306)	(5,338,095)
Capital requirement in respect of the intangible assets risk-weighted component	31,715	45,544
Total basic solvency capital requirement (BSCR)	12,104,541	10,987,945
Capital requirement in respect of operational risk	388,953	391,451
Loss absorption adjustment due to deferred tax asset	(3,122,196)	(2,635,176)
Capital requirement in respect management companies:
Clal Pension and Provident Funds Ltd.	243,704	223,222
Atudot Pension Fund for Salaried Employees and Self Employed Ltd.	8,566	8,342
Capital requirement in respect management companies	252,270	231,564
Total solvency capital requirement (SCR)	9,623,568	8,975,784

Key changes in solvency capital requirement compared to last year:

Increase in capital requirements in respect of market risks arising mainly due to the positive returns and increase in the stock scenario SA, as well as from an increase in the profitability implicit in yield-dependent policies following the increase in interest.
Decrease in capital requirements due to an increase in loss absorption adjustment due to deferred tax asset following an increase of implicit profitability.
The increase in capital requirements due to the health underwriting risk component stems from higher turnovers.
5.1 Underlying principles of the calculation of solvency capital requirement (SCR)
- The Company operates as a going concern;
- Relates to risks arising from existing assets and businesses and from the property and casualty insurance and NSLT health insurance businesses that are expected to be signed within 12 months subsequent to the reporting date;
- With regard to existing businesses, it will only cover unexpected losses;
- Reflects the scope of equity that will allow the insurance company to absorb unexpected losses and meet its obligations to policyholders and beneficiaries on time, and constitutes the VaR of Basic Tier 1 capital of the Company with 99.5% certainty over a 12-month period;
- Covers the following risk-weighted components: Life insurance, health insurance, property and casualty insurance, market risk, counterparty risk, operational risk, and controlled management companies;
- Takes into consideration risk mitigation means and methods in accordance with the guidance;
- The calculation of the scenarios is based on the estimated deviation from an estimated value of basic Tier 1 capital, on the basis of the estimated deviation in the value of assets and liabilities in the economic balance sheet upon the materialization of the scenario. Specifically, in the life and SLT health risk-weighted components, the estimated results of the scenarios are based on the results of the models used to calculate best estimates, and subject to the limits and conditions as detailed above.

6. Minimum capital requirement (MCR)

6.1. Minimum capital requirement (MCR)

	As of December 31, 2024
In NIS thousand	Audited	Audited
Minimum capital requirement according to MCR formula	2,088,014	2,004,396
Lower band (25% of solvency capital requirement in the Transitional Period)	2,405,892	2,243,946
Upper band (45% of solvency capital requirement in the Transitional Period)	4,330,606	4,039,103
Minimum capital requirement (MCR)5	2,405,892	2,243,946

6.2 Shareholders' equity for MCR

In NIS thousand	As of December 31, 2024 Audited

	Shareholders' equity in respect of SCR according to Section 4	10,493,833	4,211,813	14,705,646
Deviation from quantitative limitations due to minimum capital requirement *)		(3,730,635)	(3,730,635)
Shareholders' equity for MCR	10,493,833	481,178	10,975,011

		As of December 31, 2023 Audited

In NIS thousand	Tier 1 capital	Tier 2 capital	Total
Shareholders' equity in respect of SCR according to Section 4	9,822,922	4,196,368	14,019,290
Deviation from quantitative limitations due to minimum capital requirement *)		(3,747,578)	(3,747,578)
Shareholders' equity for MCR	9,822,922	448,790	10,271,712

*) In accordance with the provisions of Chapter 3 in Part B to the Economic Solvency Regime Appendix, Tier 2 capital shall not exceed 20% of MCR.

^5. If this amount is lower than the Tier 1 capital according to Regulation 2 to the Capital Regulations, the minimum capital requirement will be the Tier 1 capital.

7. Effect of the application of the Provisions for the Transitional Period

For a description of the Transitional Provisions applicable to the Company during the Transitional Period see Section 1.3 "Provisions During the Transitional Period" and Section 3.1.2 "Deduction During the Transitional Period" above.

	As of December 31, 2024 Audited

NIS thousand	Including applying the Provisions for the Transitional Period for the Transitional Period	Effect of Deduction during the Transitional Period	Effect of a 50% rate Tier 2 capital during the Transitional Period	Excluding applying the Provisions for the Transitional Period
Total insurance liabilities, including risk margin (RM)	124,338,813	(2,063,487)	-	126,402,300
Basic Tier 1 capital	10,030,932	1,346,426	-	8,684,506
Shareholders' equity in respect of SCR	14,705,646	1,059,600	362,386	13,283,660
Solvency capital requirement (SCR)	9,623,568	(717,062)	-	10,340,630

	As of December 31, 2023
	Audited
NIS thousand	Including applying the Provisions for the Transitional Period for the Transitional Period	Effect of Deduction during the Transitional Period	Effect of a 50% rate Tier 2 capital during the Transitional Period	Excluding applying the Provisions for the Transitional Period
Total insurance liabilities, including risk margin (RM)	120,711,682	(4,115,103)	-	124,826,785
Basic Tier 1 capital	9,357,962	2,708,149	-	6,649,813
Shareholders' equity in respect of SCR	14,019,290	2,145,393	606,054	11,267,843
Solvency capital requirement (SCR)	8,975,784	(1,406,892)	-	10,382,676

Main Changes in relation to previous year:

• A recalculation of the Deduction Amount as of December 31, 2024 led to a decrease in the effect of the inclusion of the Deduction during the Transitional Period.

In NIS thousand	Shareholders' equity in respect of SCR	Solvency capital requirement (SCR)	Capital surplus (deficit)
As of January 1, 2024	14,019,290	8,975,784	5,043,506
Net of the Provisions for the Transitional Period	(2,751,447)	1,406,892	(4,158,339)
As of January 1, 2024, excluding applying the transitional Provisions for the Transitional Period	11,267,843	10,382,676	885,167
The effect of operating activities (a)	1,153,129	(207,518)	1,360,647
Effect of economic activity (b)	1,951,775	1,063,501	888,274
New businesses (c)	426,290	198,471	227,819
Effect of the issuance of capital instruments (net of redemptions) and a declared dividend (d)	(400,000)	-	(400,000)
Effect of changes in deferred tax, Additional Tier 1 capital and Tier 2 capital	(1,115,377)	(1,096,500)	(18,877)
As of December 31, 2024, total without applying the Transitional Provisions for the Transitional Period	13,283,660	10,340,630	2,943,030
Effect of the Transitional Provisions for the Transitional Period	1,421,986	(717,062)	2,139,048
As of December 31, 2024	14,705,646	9,623,568	5,082,078

8. Report of Movements in Capital Surplus

(a) This section includes the effect of:

1. The projected cash flow implicit in the opening balance and which was expected to be released in the reporting year;
1. Deviations from demographic and operating assumptions in the reporting year;
1. Changes in regulatory rules;
1. Changes in demographic and operating assumptions compared with those used on the date of the previous report;
1. Model updates;
1. New insurance contracts (P&C Insurance and NSLT health insurance) signed in the reporting year, and insurance portfolios in those subsegments, purchased or sold in the reporting year;
1. Investment in intangible assets;
1. Other changes not included in the other items.
(b) This section includes the effect of the current operating activity, including:
- 1. Changes in the value of investment assets;
- 1. Changes in capital requirement in respect of market risk component, including change in the symmetric adjustment (SA) component;
- 1. Effect of inflation;
- 1. Effect of changes in the risk-free interest rate curve on solvency.
(c) This item includes new insurance contracts (SLT life and health insurance) signed in the reporting year, and insurance portfolios in those subsegments, purchased or sold in the reporting year, including their effect on market risks, counterparty risk and operational risk.
(d) This item includes equity transactions, including issuance and redemption of Tier 1 capital and Tier 2 capital instruments and a dividend declared subsequent to the date of the solvency ratio report as of December 31, 2024 and through the approval date of the solvency ratio report as of December 31, 2024.

Main effects reflected in the movements in the Company's capital surplus:

Effect of economic activity – The rise in the risk-free interest rate curve in 2024 and the excess returns for the period had a positive effect on the Company's capital surplus and has offset the adverse effects of the greater capital requirements for market risks, as specified in Section 2.1.

The effect of operating activities -

The application of the Stochastic Model had a positive effect and was partially offset by the application of the studies for the period, which include, among other things, a revision of the demographic assumptions in life insurance.
The positive effect of the amortization of risks and the freed up capital arising from previously sold insurance activity
A negative underwriting effect, among other things, in light of a higher cancellation rate of executive policies for the period, which was partially offset by a positive underwriting effect in P&C Insurance.

The effect of new businesses' activity - new businesses sold in 2024 had a positive contribution to the Company's profitability, while, on the other hand, they gave rise to capital requirements.

The effect of the Provisions for the Transitional Period – the capital surplus was negatively affected during the Transitional Period, due to the recalculation of the Deduction Amount in the first half and the annual amortization, as detailed in Section 1.3.1.

9. Sensitivity tests

Following is a sensitivity analysis of the economic solvency ratio to various risk factors as of the report date. This analysis will reflect the effects of various risk factors both on equity, including the quantitative restrictions that apply to equity, and on the capital required for solvency purposes. The sensitivity tests only reflect direct effects, holding all other risk factors constant, and do not include secondary effects or derived changes on other risk factors.

It is noted that the sensitivity is not necessarily linear; i.e., sensitivity at other rates is not necessarily a simple extrapolation of the sensitivity test presented.

	As of December 31, 2024
	Effect on the economic solvency ratio (in percentage points)
A 50 basis points decrease in the risk-free interest rate curve	(6%)
A 25% decrease in the value of equity assets	(0%)*
A 5% increase in morbidity rate	(9%)
A 5% decrease in mortality rates	(10%)
A 10% increase in lapses rates	(4%)

* Without material change

The sensitivity tests were applied to the economic balance sheet in relation to assets and liabilities that are directly affected by the assumption being tested in each sensitivity test, as detailed above, and by recalculating the risk margin. The effects on the Company's capital requirements were also taken into account.
Within the sensitivity tests regarding interest rates and mortality rates, the sensitivity to the relevant scenario for the Company, out of an increase or a decrease, was examined.
The interest rate sensitivity test reflects a 50 basis points decrease in the risk-free interest rate curve, up to the Last Liquidity Point (LLP), and thereafter, it is calculated according to the Smith-Wilson extrapolation with respect to the Ultimate Forward Rate (UFR), which is fixed according to the circular.
It is noted that the effect of the sensitivity on the Deduction Amount in the relevant scenarios was not taken into account.
The demographic sensitivity tests were applied to all of the Company's policies that are relevant to that sensitivity test.
A 5% increase in the morbidity rate sensitivity test refers to the prevalence of claims and does not relate to the duration or severity of the claim.
The sensitivity test for a decrease in the value of equity assets was applied to all stocks that are treated within the stock risk sub-component, including the effect of the symmetric adjustment (SA) to the capital requirements.
The sensitivity tests do not include the effect of material equity transactions made in the period between the calculation date and the publication date of the Economic Solvency Ratio Report:

10. Restrictions on Dividend Distribution

The Company's policy is to have a solid capital base to ensure its solvency and ability to meet its liabilities to policyholders, to preserve the Company's ability to continue its business activity and its ability to provide returns to its shareholders and support future business activity. In its capacity as an institutional entity, the Company is subject to the capital requirements set by the Commissioner.

10.1 Dividend

According to the letter published by the Authority, in October 2017, (hereinafter - the "Letter") an insurance company shall be entitled to distribute a dividend only if, following the distribution, the company has a solvency ratio - according to the Economic Solvency Circular - of at least 100%, calculated without taking into account the Transitional Provisions and subject to the solvency ratio target set by the Company's Board of Directors. The aforesaid ratio shall be calculated without the relief granted in respect of the original difference attributed to the acquisition of the provident funds and management companies. In addition, the letter set out provisions for reporting to the Commissioner.

The following are data on the Company's economic solvency ratio, calculated without taking into account the Transitional Provisions and subject to the solvency ratio target set by the Company's Board of Directors. The ratio is lower than the solvency ratio required by the letter.

10.2Capital management and dividend distribution policies

On June 28, 2023, the Board of Directors of the Company approved a policy for the distribution of a dividend at a rate of 30%-50% of the Company's comprehensive income. The distribution is subject to the Company's complying with a minimum equity target of 110% in accordance with the economic solvency regime, without implementing the transitional provisions. The distribution is also subject to the Company's complying with its capital targets, taking into consideration the Transitional Provisions during and after the Transitional Period.

This is further to setting a capital management policy whereby the target range for the Company's economic solvency ratio shall be 150%-170%, as approved in June 2021. In addition, the minimum economic solvency ratio target for prudential purposes is set at 135%. These targets relate to a solvency ratio taking into account the Deduction Amount during the Transitional Period until the end of 2032 and thereafter.

On May 28, 2025, the Company's Board of Directors approved the revision of the minimum capital target for dividend distribution to 115%.

It is hereby clarified that this policy should not be viewed as an undertaking by the Company to distribute dividends.

It is noted that in February 2025, the Commissioner issued a letter regarding capital targets, which clarifies the appropriate practices for setting the capital targets. The Company is reviewing its targets in light of the Commissioner's letter.

On November 27, 2024, Clal Insurance's Board approved a dividend distribution totaling approx. NIS 100 million, which constitutes approx. 45% of Clal Insurance's comprehensive income in 2023, having considered all aspects, including Clal Insurance's compliance with the economic solvency ratios detailed above.

Additionally, on May 28, 2025, subsequent to the reporting date, Clal Insurance's Board approved a dividend distribution totaling approx. NIS 300 million, which constitutes approx. 46% of Clal Insurance's comprehensive income in 2024, having considered all aspects, including Clal Insurance's compliance with the economic solvency ratios detailed above. This dividend distribution was taken into account in the calculation of the solvency ratio as of December 31, 2024.

	As of December 31, 2024	As of December 31, 2023
In NIS thousand	Audited	Audited
Shareholders' equity in respect of SCR	13,283,660	11,267,843
Solvency capital requirement (SCR)	10,340,630	10,382,676
Surplus	2,943,030	885,167
Economic solvency ratio (in %)	128%	109%
Effect of material equity transactions taken in the period between the calculation date and the publication date of the solvency ratio report: Raising (redemption) of capital instruments (*)	-	-
Shareholders' equity in respect of SCR	13,283,660	11,267,843
Surplus	2,943,030	885,167
Economic solvency ratio (in %)	128%	109%
Capital surplus after equity transactions taken in the period between the calculation date and the publication date of the Economic Solvency Ratio Report, compared with the Board of Directors' target:
The Board of Directors' economic solvency ratio target (percentages)	115%	110%
Capital surplus (shortfall) relative to the target (NIS thousand)	1,391,935	(153,101)

10.3 Solvency ratio without applying the Provisions for the Transitional Period:

(*) Subsequent to the reporting date, on April 24, 2025, Bonds (Series 14) were issued for a total of approx. NIS 500 million. This issuance does not affect the capital surplus and the economic solvency ratio, since as of December 31, 2024 there is an unutilized Tier 2 capital balance of approx. NIS 76 million in excess of the Tier 2 capital cap (40% of the capital requirements in a calculation without the Transitional Period).

Material changes from the previous year:

For an explanation regarding key changes, see Section 2.1 above, except for the effect of the Deduction Amount, which is not relevant for a calculation without applying the Transitional Provisions for the Transitional Period.

May 28, 2025
Approval date of the	Haim Samet	Yoram Naveh	Eran Czerninski	Avi Ben Noon
financial statements	Chairman of the Board	CEO	Executive VP	Executive VP
			Head of the Finance Division	Chief Risk Officer

Clal Insurance Enterprises Holdings Ltd. | Raoul Wallenberg St. 36 | Kiryat Atidim, Tower 8, Tel-Aviv, Israel Tel. +972-3-6387777 | *5454 | Fax. +972-6387676

Clal.co.il

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Clal Insurance

6731_rns_2025-06-12_9e688ef5-6a26-4236-a937-642f75099203.pdf

2025 Clal Insurance Enterprises Holdings Ltd. Financial Statements as of March 31,

IMPORTANT

Quarterly Report As of March 31, 2025

As of March 31, 2025

Table of Contents

Forward-looking information

1. The Group's Structure, its Areas of Activity, and Developments Therein

1.1 The Group's Structure

The Company's shareholders

1.2 The Group's Areas of Activity and Developments Therein

2. The Board of Directors' Explanations for the State of the Corporation's Business

2.1 Significant Events during and Subsequent to the Reporting Period:

A. Approval of the Company's dividend distribution

B. Solvency ratio, revision of capital target and dividend distribution in Clal Insurance

C. Capital markets and risk-free interest rate curve during the Reporting Period and thereafter

D. Debt raising by Clal Insurance Capital Raising Ltd. a subsidiary of Clal Insurance

E. Debt raising by Max and its becoming a reporting corporation

F. The Iron Swords War

Israel's credit rating

Effect on the Financial Statements

G. Share-based payment

2.2 Financial Information by Area of Activity (for details regarding the operating segments, see Note 4 to the Consolidated Interim Financial Statements).

Following are the main changes in comprehensive income compared to prior periods:

A. The Company's results in the Reporting Period

Insurance and savings

Credit cards and other

Revenue from investment and capital markets:

Tax expenses

Return on equity

Premiums, contributions towards benefits and assets under management

2.2.1 Long-term savings

2.2.1.1. Life Insurance Subsegment including investment contract

Income from insurance services and activity:

Financial effects:

2.2.1.2 Data regarding premiums earned, management fees and financial margin in life insurance:

Details regarding the rates of return on participating policies

2.2.1.3 Provident Subsegment

Contributions towards benefits - provident

2.2.1.4 Pension Subsegment

Contributions towards benefits - pension

2.2.2 Property and casualty insurance - Following is a breakdown of the premiums and the comprehensive income

Gross premiums:

Comprehensive income:

2.2.3 Health insurance

Gross premiums:

Comprehensive income:

Income from insurance services and activity:

Financial effects:

2.2.4. Credit cards

2.2.4.1 Data by areas of activity - Max

2.3 Additional data regarding Max

2.3.1 Quantitative data regarding the credit card transactions

Definitions:

Turnover of transactions in respect of valid credit cards (active and inactive) (in NIS million):

2.3.2 Key credit quality indicators

2.4 Capital and capital requirements

A. Capital requirements in accordance with the application provisions of the Economic Solvency Regime in Clal Insurance (see Section 1 below)

1. Economic solvency ratio

2. Minimum capital requirement (MCR)

3. Solvency ratio without applying the Provisions for the Transitional Period

4. Update regarding the stochastic model when calculating the economic solvency ratio of Clal Insurance

5. Revision of the capital target in Clal Insurance and dividend distribution in the Company and in Clal Insurance

6. Own Risk and Solvency Assessment of the Company (ORSA)

7. Debt raising by Clal Insurance Capital Raising Ltd. a subsidiary of Clal Insurance

B. Capital requirements and capital adequacy in Max

1. Equity and capital adequacy

2. The Bank of Israel's capital adequacy targets

3. Max's capital adequacy targets

4. Total capital adequacy to risk-weighted components ratio in Max: (*)

5. Dividend distribution policy and actual dividend distribution by Max

2.5. Analysis of Cash Flow Development, Sources of Financing and Liquidity

2.5.1.Cash flow for the Reporting Period

2.5.2. Company's financing

2.5.2.1 The Company's sources of financing and liquidity

2.5.2.2 The Company's financing characteristics

2.5.2.3 Dedicated disclosure for the Company's bond holders

A. Bonds' data

**4. Total capital adequacy to risk-weighted components ratio in Max: (*)**