Clal Insurance Enterprises Holdings Ltd. Financial Statements as of September 30, 2024

IMPORTANT

This document is an unofficial translation for convenience only of the Hebrew original of the September 30, 2024 , financial report of Clal Insurance Enterprises Holdings Ltd. that was submitted to the Tel-Aviv Stock Exchange and the Israeli Securities Authority on November 28, 2024.

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

Clal Insurance Enterprises Holdings Ltd.

Quarterly Report As of September 30, 2024

November 28, 2024

1. Report of the Board of Directors
1. Condensed Consolidated Interim Financial Statements
1. Separate Financial Data from the Consolidated Interim Financial Statements Attributable to the Company (Regulation 38C)
1. Report on the Effectiveness of Internal Control over Financial Reporting and Disclosure
1. Economic Solvency Ratio Report as of June 30, 2024

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

1.		The Group's Structure, its Areas of Activity, and Developments Therein	1-4
	1.1	The Group's Structure	1-4
	1.2	The Group's Areas of Activity and Developments Therein	1-4
2.		The Board of Directors' Explanations for the State of the Corporation's Business	1-4
	2.1	Significant Events During and Subsequent to the Reporting Period:	1-4
	2.2	Financial Information by Area of Activity	1-10
	2.3	Key Consolidated Statements of Financial Position Data	1-31
	2.4	Capital and Capital Requirements	1-32
	2.5	Analysis of Cash Flow Development, Sources of Financing and Liquidity	1-39
3.		Developments and Material Changes in the Macroeconomic Environment in the Reporting Period	1-44
	3.1	Key Economic Data:	1-44
	3.2	Key trends and material changes in the macroeconomic environment in the Reporting
		Period and thereafter:	1-45
4.		Restrictions on and Supervision of the Corporation's Business	1-48
	4.1	General	1-48
	4.2	Long-Term Savings	1-51
	4.3	P&C Insurance	1-54
	4.4	Max's Activity	1-56
5.		Exposure to Market Risks and Management Thereof	1-60
6.		Risk Review for Max	1-62
7.		Disclosure regarding Financial Reporting of the Corporation	1-78
	7.1	Reporting Critical Accounting Estimates	1-78
	7.2.	Contingent Liabilities	1-78

Report of the Board of Directors on the State of the Corporation's Affairs for the Period ended September 30, 2024 (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 nine months of 2024 (hereinafter - the "Reporting Period") and in the three months ended September 30, 2024 (hereinafter - the "Quarter").

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, 2023 (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 in 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 Group 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 Periodic Report of 2023.

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

The Group companies' operations are affected by constant changes in regulations 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, and consequently - for management fees and 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 volume of activity and have direct consequences on its business results.

2.1 Significant Events during and Subsequent to the Reporting Period:

A. Approval of the Company's dividend policy and distribution

In September 2024, the Company's Board of Directors approved the 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 (see Section C below) and Max (see Section D 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.

It is hereby clarified that 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 (higher or lower) 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, on November 28, 2024, the Company's Board approved a dividend distribution totaling approx. NIS 100 million, which constitutes approx. 60% 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 and dividend distribution at Clal Insurance

Clal Insurance published an Economic Solvency Ratio Report as of June 30, 2024, where under the ratio without applying the Provisions for the Transitional Period after the dividend distribution is 126% 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 162% as of June 30, 2024, compared to 159% as of December 31, 2023, respectively. For further details, see Section 2.4 and Note 7 to the Consolidated Interim Financial Statements.

According to Clal Insurance's dividend distribution policy (see Note 7(c)1(b) to the Consolidated Interim Financial Statements), 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.

1) Taking into consideration equity transactions that took place subsequent to June 30, 2024, as of the publication date of the Economic Solvency Ratio Report as of June 30, 2024.

2) For details regarding the disclosure pertaining to the stochastic model in the calculation of the economic solvency ratio of Clal Insurance, which - based on market conditions as of June 30, 2024 - its effect is estimated by adding approx. 17%, without taking into consideration the Provisions for the Transitional Period, and by adding approx. 9% taking into consideration the Provisions for the Transitional Period, see Section 2.4 below.

C. Approval of Max's internal capital target, dividend distribution policy and dividend distribution

Further to Note 17(f) to the annual financial statements regarding Max's capital adequacy target, and Note 17(c) to the Annual Financial Statements regarding a dividend in Max, on June 30, 2024 the Board of Directors of Max It Finance Ltd. (hereinafter - "Max") - a Company subsidiary - approved Max's CET1 capital ratio internal target at 9.25%, and a dividend distribution policy, under which as from 2024 Max will be able to distribute dividends at a total amount of up to 30% of the net income for the year, which preceded the distribution year, in accordance with Max's consolidated financial statements.

It is clarified that by setting this 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, on June 30, 2024, Max's Board of Directors approved the distribution of a dividend in the amount of NIS 62 million, which constitutes approx. 28% of Max's net income for 2023. The dividend was paid on July 3, 2024.

The dividend was paid in compliance with all restrictions applicable to Max.

D. Capital markets and risk-free interest rate curve during the reporting period and thereafter

The results in the Reporting Period and for the three-month period ended September 30, 2024 were affected mainly by volatility in capital markets, mainly in share indices, which affected investment income in the nostro portfolio. It should also be noted that in participating insurance policies, no variable management fees were collected during the Reporting Period (Clal Insurance has a pre-tax liability of approx. NIS 0.3 billion to policyholders as of the date of the Interim Financial Statements and approx. NIS 0.2 billion shortly before the approval date of the Interim Financial Statements, and until it meets this undertaking Clal Insurance shall not collect variable management fees). In addition, during the Reporting Period there were changes in the risk-free interest rate curve, with the addition of illiquidity premium, which caused a decrease in insurance liabilities. For details about the impact of the above on the results, see the Special Items table in Section 2.2 below. For details regarding the Group's sensitivity to changes in interest rates, see Note 42 to the Annual Financial Statements.

E. Repayment of syndicated loan by CIMax

In February 2024, the Company used the proceeds of the issuance of the bonds for an early repayment of the entire amount of the syndicated loan taken by CIMax Holdings Ltd. from institutional entities in 2019 (hereinafter - the "Syndicated Loan"), as explained in Note 26 to the Annual Financial Statements. Consequently, the Group reduced its finance expenses in this quarter compared to last year, and also extended the average duration of its liabilities.

F. Issuance of Subordinated Notes (replacement of Series J and expansion of Series M) in the subsidiary Clal Insurance

In January 2024, Clal Insurance issued to holders of Notes (Series J), who accepted an exchange tender offer, Subordinated Notes (Series M) totaling NIS 508 million p.v. by way of series expansion. The terms of some of the Notes (Series J) vary from the terms of the Notes (Series M), and accordingly they were accounted for as replacement of debt instruments with materially different terms, in accordance with the standard's definition; accordingly, Clal Insurance accrued a loss of approx. NIS 1.6 million.

Furthermore, in April 2024 Clal Insurance issued to the public NIS 465 million p.v. in Subordinated Notes (Series M) by way of expansion of an existing series. For further details, see Note 6 to the Consolidated Interim Financial Statements.

G. The Iron Swords War

Following on Note 46(k) to the Financial Statements for 2023, the Israeli economy continues operating in a wartime routine. The economy is operating almost at normal levels, except for the areas which suffered directly from the events of October 7th, 2023 and the north of Israel, where the firing range grew, with fighting intensifying in recent months, residents still unable to return to their homes and businesses unable to resume operations.

Israel's credit rating

The rating agencies revised the rating of the State of Israel and their rating outlooks due to the escalation of the conflict between Israel and Iran and the geopolitical risks Israel is exposed to since the outbreak of the War, as follows: Rating agency Moody's (hereinafter - "Moody's") announced on February 9, 2024 that it was downgrading of the State of Israel's debt credit rating from A1 to A2 as well as a negative rating outlook. The downgrading of the credit rating and the change of the rating outlook to negative mainly reflected - as explained by the rating agency - the uncertainty as to the economic consequences of the War, the manner and timing by which the War will end and the change in fiscal conditions. International credit rating agency S&P announced on April 18, 2024 the downgrading of the sovereign rating of Israel from AA- to A+ and reiterated the rating outlook at negative. Furthermore, on April 2, 2024 the international credit rating agency Fitch reiterated Israel's credit rating at A+ but changed the rating outlook from stable to negative.

In addition, on August 12, 2024, international credit rating agency Fitch downgraded Israel's credit rating from A+ to A, with a negative rating outlook. The reasons for the rating downgrade arise, among other things, from the continued fighting in Gaza and the increase in the geopolitical risks.

On September 27, 2024, the rating agency Moody's announced a downgrading of the State of Israel's debt credit rating by two notches (in one go) from A2 to Baa1 with a negative outlook.

On October 1, 2024, the rating agency S&P announced the downgrading of the State of Israel's credit rating from A+ to A with a negative outlook, bringing forward by five weeks its scheduled announcement, which was planned to be issued on November 8, 2024. The reasons for the credit rating downgrade outside the normally scheduled rating announcements are, among other things, the escalating conflict between Israel and Hezbollah, which - according to S&P - is highly likely to become intensive and persistent.

Effect on the financial statements

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 announced that, as from December 2023 and during the Reporting Period, the issuance turnovers in Israel and acquiring turnovers in Max were even higher than the corresponding period last year. Max's overseas issuance turnovers, which were affected throughout the War, have also started growing gradually; however, any escalation or security event, which takes place during this period, has a direct effect on overseas issuance turnovers. Despite the fact that in the second and third quarters of the year the volumes of overseas turnovers were similar to those of the corresponding periods last year, in view of the relatively low overseas turnover in the first quarter of the year, the aggregate overseas turnovers for the Reporting Period are still relatively low compared to the corresponding period last year.

The estimated credit loss provision is based on judgments and assessments, and still involves uncertainty at this stage. Further to Max's 2023 Financial Report, Max increased the provision for current expected credit losses based on estimates of a potential increase in the credit risk of its customers.

In addition, on November 18, 2024, following the impact of fragments of a missile near Max's site in Bnei Brak, the office building rented by Max suffered property damage due to the blast and shrapnel. Max's assessment of the situation is that no damage was caused to its infrastructure, and it continues operating and providing full service to its customers. The operations required for the refurbishment commenced immediately in coordination with the relevant government agencies and the lessor. Max estimates that the refurbishment work will last several months but will not affect it business activity.

The Group is exposed - by virtue of its activity - to fluctuations in the financial markets and to slowdown in activity in the Israeli economy, as well as to other risks arising from the War. Estimating the duration of the War and its potential effect on economic activity across the country, the capital markets 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, is difficult.

Therefore, as of the report publication date, it is impossible to assess the full effect of the War on the Group and its results.

Cyber and information security risks

Since the beginning of the War, and even more so in the past few months, the Group saw an increase in the scope and complexity of cyber-attacks against Group companies. From time to time, Group companies take ongoing steps to improve its infrastructures, which were designed to deal with the said risk.

H. Share-based payment

Further to Note 44 in the Annual Financial Statements, on May 19, 2024, the Company's board of directors resolved to publish an outline for the allocation of up to 1,400,000 Class A 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. 0.44% 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 14.1 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 18.75 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 one year from the vesting date. (In relation 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.

I. Filing of a draft prospectus of Max

For details, see Section 2.4.B.5 below.

J. Agreement with the National Insurance Institute under the National Insurance Law

For details, see Note 12(d)4 to the Consolidated Interim Financial Statements.

K. Changes to actuarial assumptions in the calculation of the liabilities for annuities

For details, see Note 12(d)1(d) to the Consolidated Interim Financial Statements.

L. Expected material effects of IFRS 9 and IFRS 17 on capital and on the balance of the contractual service margin as of the transition date (hereinafter - the "Reporting Standards")

As part of Clal Insurance's preparations for the application of the Reporting Standards in 2025 (as stated in Note 13 to the Consolidated Interim Financial Statements); and in accordance with data unreviewed and unaudited by the independent auditors, which were prepared by Clal Insurance, as of the approval date of the Interim Financial Statements regarding the application of the Provisions as of Transition Date of liabilities and insurance assets, which will be accounted for in accordance with IFRS 17 and the effects of the first-time application of IFRS 9 to financial instruments - at this stage, Clal Insurance's initial assessment is that the material effects on the opening balances of the Financial Statements as of January 1, 2024 (the transition date set by the Capital Market Authority) with respect to capital and the contractual service margin balance, will be as detailed below:

Migdal Insurance's total capital estimate as of the transition date is expected to be between NIS 5.15 billion and NIS 5.75 billion, and in the Company - between NIS 7 billion and NIS 7.6 billion (compared to an accounting capital of Clal Insurance totaling approx. NIS 6.7 billion and accounting capital of the Company totaling approx. NIS 8.6 billion, in accordance with each of the companies' financial statements as of December 31, 2023).

In addition, Clal Insurance expects to recognize a contractual service margin (CSM)¹ (net of CSM from reinsurance) of between NIS 8.4 billion and NIS 9.2 billion pre-tax and between NIS 5.5 billion and NIS 6.2 billion post-tax.

It is clarified that this balance of expected contractual service margin shall be recognized as income from insurance services over the service period, in accordance with the actuarial and financial assumptions as of December 31, 2023, and if changes will be made to assumptions this will result in a revision to the balance. In addition, it is clarified that this balance is mainly in respect of long-term Life and Health Insurance contract and does not relate to income in respect of short-term Health and Property and Casualty insurance contract, Pension and Provident activity, agencies and credit cards.

For more information about the implementation of IFRS 9 and IFRS 17, see Note 13 to the Consolidated Interim Financial Statements.

It is noted that Clal Insurance has not yet completed all the controls and tests in connection with those data, and that changes may be made to the abovementioned data through the actual implementation date.

The abovementioned information was mostly included in the data sent to the Capital Market Authority in accordance with the roadmap published by the Authority in connection with the adoption of IFRS 17, and in the quantitative impact studies, which were designed to assist Clal Insurance and the Capital Market Authority in assessing the preparedness of Clal Insurance and the Authority for the implementation of the new standards, while assisting in the decision-making process. Therefore, the data may be adjusted, including, among other things, in accordance with the Authority's guidance, changes in accounting policies, or due to further preparations by Migdal Insurance for the implementation of the standard, including following discussions with the independent auditors.

The manner by which the standard will be implemented may also be subject to changes or adjustments following clarifications or revisions to international financial reporting standards, changes to existing practices abroad and the emerging practice in Israel, regulatory changes, tax changes or changes and adjustments to various estimates made by Clal Insurance in accordance with professional judgment. Therefore, the above data or results should not be deemed binding data or binding results. Therefore all the information included above constitutes forward-looking information as defined in the Securities Law, 1968.

¹ Contractual Service Margin

2.2 Financial Information by Area of Activity (for details about 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.

Summary of data from the Group's consolidated Financial Statements

towards benefits -

provident

1-10

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. Proceeds in respect of investment contracts are not included in premiums; rather, they are charged directly to liabilities in respect of insurance contracts and investment contracts.

For further details on the premiums in the various operating segments, see Note 4 to the Consolidated Interim Financial Statements.

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

Movement	315	(235)	130	410	(232)
1-9/2024	377	109	309	114	(318)
1-9/2023	62	344	179	(296)	(86)

Movement	124	276	23	317	(દિવે)
03/24	92	265	103	222	(136)
Q3/23	(32)	(11)	80	(ਰੇਟ)	(67)

Following are details of key components of comprehensive income; it is noted that in view of the completion of the acquisition of CIMax on March 27, 2023, CIMax's operating results were consolidated with the Company's financial statements as from April 1, 2023, under key components of comprehensive income, except for the provision for credit default following Max's acquisition, which was included in the financial statements for the first quarter of 2023, as stated below:

			1-9		7-9		For the year
			2024	2023	2024	2023	2023
In NIS
million		Item	Unaudited		Unaudited		Audited
	Life Insurance - net of financial effects on insurance reserves	2.2.1.1	(139)	(116)	(36)	(129)	(159)
	Pension	2.2.1.4	37	38	13	18	47
	Provident	2.2.1.3	6	8	1	4	10
	Total Long-Term Savings excluding financial effects on insurance reserves		(96)	(70)	(22)	(107)	(102)
Insurance and	P&C Insurance - net of financial effects on insurance reserves	2.2.2	389	135	83	90	229
savings	Health without financial effects on insurance reserves	2.2.3	85	(3)	32	(15)	25
	Total comprehensive income (loss) in respect of Insurance and Savings excluding financial effects on insurance reserves		377	62	92	(32)	152
	Financial effects on insurance reserves *)		109	344	(11)	265	365
	Total comprehensive income in respect of insurance and savings		486	406	81	233	517
Credit Cards	Total income in respect of credit cards	2.2.4	309	179	103	80	238
Other and	Finance expenses	2.2.7	(242)	(211)	(78)	(79)	(294)
unallocated	Other	2.2.5	326	58	301	(40)	138
Income before consolidation entries	Total comprehensive income, pre-tax before the Max consolidation entries		879	431	408	193	598
	Provision for credit default following the acquisition of Max **)		‐	(220)	‐	‐	(220)
Adjustments and offsets	Amortization of excess cost in respect of the Max transaction		36	80	2	24	98
	Total adjustments and offsets before tax		36	(140)	2	24	(122)
Pretax income	Total comprehensive income, before tax		914	291	410	217	476
Taxes	Tax expenses		318	86	136	67	167
	Total comprehensive income (loss), post-tax for the period		596	205	274	150	309
Profit after	Attributable to Company's shareholders		591	203	271	151	305
taxes	Attributable to non-controlling interests		5	2	3	(1)	4
	Return on equity in annualized terms (in percentages) ***)		9.2	3.4	12.2	7.2	3.8

*) Mostly due to a change in the risk-free interest rate curve. For further details regarding the financial effects on insurance reserves, see the table in Section 2(a) below.

**) As part of the consolidation of Max in accordance with accounting standards, the Company recognized a provision for credit default in excess of the fair value, following Max's acquisition. For further details see Note 3(i)(1)(d) to the Consolidated Annual Financial Statements.

***)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 591 million, compared with a comprehensive income of approx. NIS 203 million in the corresponding period last year.

The improvement in income is characterized by a significant increase in income from business activity, and an increase in the financial margin due to higher real returns in the capital market, as detailed below:

It is emphasized that on March 27, 2023 the Company completed the acquisition of CIMax (see Note 5 to the Financial Statements). As a result, in its financial statements as of March 31, 2023, the Company consolidated for the first time the assets and liabilities of CIMax and companies under its control.

The operating results of CIMax and the companies under its control and the adjustments made in connection with the acquisition were included in the results of the Company's financial statements as from April 1, 2023, except for a provision for credit default in Max's acquisition, which was recognized in the first quarter of 2023.

Following are the key changes in the results compared with the corresponding period last year:

Insurance and savings without financial effects on reserves

In the Reporting Period, total income in respect of the insurance and savings segments without financial effects on the pre-tax liabilities amounted to approx. NIS 377 million, compared with an income of approx. NIS 62 million in the corresponding period last year.

Underwriting results and savings assets under management:

During the Reporting Period, there was a significant increase in the underwriting income - primarily in the Property and Casualty Segment and in the Health Insurance Segment, compared to the corresponding period last year, as detailed below in Sections 2.2.1-2.2.3.

In the Reporting Period, there was an increase in contributions towards benefits provided by the provident funds and pension funds subsegments; on the other hand, there was a decrease in proceeds from investment contracts that stem, among other things, from volatility in capital markets, such that the total gross premiums earned, the contributions towards benefits, and proceeds from investment contracts amounted to approx. NIS 19.8 billion, compared with approx. NIS 20.1 billion in the corresponding period last year - a decrease of approx. 2%.

Investment income and the capital markets:

In the Reporting Period, capital markets provided higher returns compared to last year, which affected the returns achieved by the Company, such that a positive financial margin of approx. NIS 523 million was recognized in life insurance, as well approx. NIS 348 million in investment income not allocated to segments, compared with approx. NIS 474 million in financial margin in life insurance and approx. NIS 82 million in unallocated investment income in the corresponding period last year.

It should be noted that in view of the negative real returns in the capital markets last year, in the Reporting Period and in the corresponding period last year the Company did not collect variable management fees; and as of the report date, the Company has a liability to policyholders of approx. NIS 0.3 billion in respect of negative returns on the portfolio of life insurance participating policies, and until it meets this undertaking Clal Insurance will not collect variable management fees.

Revisions of actuarial assumptions:

During the Reporting Period, there was a change in actuarial assumptions in the calculation of liabilities for annuities, which resulted in an approx. NIS 59 million increase in the reserve with no effect in the corresponding period last year.

Credit cards

The total income from credit cards in the Reporting Period amounted to approx. NIS 309 million before tax compared to approx. NIS 179 million in the corresponding period last year.

The data for the corresponding period last year also include the data for the first quarter of 2023; they are presented for comparison purposes only and were not consolidated in the Company's financial statements.

Max's income in this period amounted to approx. NIS 1,668 million. This reflected the continued growth in Max's activities. Of which Max's total income from credit card transactions totaled approx. NIS 1,057 million. Income 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 income from merchants net of fees and commissions to other issuers. The turnover of Max's domestic activity was up in the first nine months and third quarter of 2024 compared to the corresponding period last year - an increase which led to an increase in Max's income from credit card transactions, both on the issuance side and on the acquiring side. However, this increase was partially offset by a decrease in the Company's revenues from overseas fees and commissions, due to the decrease in inbound and outbound tourism activity following the War.

Max's net interest income grew and amounted to approx. NIS 601 million, mostly due to an increase in business activities, in view of responsible and sound management of the increase in Max's 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 159 million, compared with an expense of approx. NIS 188 million in the corresponding period last year.

The decrease in credit loss expenses arises mainly from the fact that in accordance with the directive of the Banking Supervision Department, the Company had already included in the financial statements for the third quarter of 2023 the anticipated effect of the War and increased the provision for credit losses accordingly.

Furthermore, in the first nine months of 2024, there was an improvement in the quality of the Company's credit portfolio, which was reflected, among other things, in an increase in the share of vehicle loans in the credit portfolio, in risk mitigation and in an improvement in borrowers' risk ratings.

It is noted that in accordance with the Bank of Israel's directives, as from January 1, 2023 Max implements - for the first time - new rules regarding current expected credit losses (CECL), which reflect a new methodology for calculating the credit loss provision, which results mainly in earlier recognition of credit losses, which might be incurred throughout the credit period.

Max's operating expenses for the first nine months amounted to NIS 658 million compared to NIS 652 million in the corresponding period last year (net of one-off effect); the increase in operating expenses arises mainly from an increase in the business activities.

Tax expenses

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 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 income 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 September 30, 2024 stood at 28.3%, compared to 23.3% in the corresponding period last year. The increase in the effective tax rate arises from oneoff tax expenses arising from the closing of income tax assessments in respect of previous years.

The said effects caused an approx. NIS 18 million one-off increase in tax expenses in the Reporting Period.

Return on equity

The return on equity in annualized terms during the Reporting Period was a positive 9.2%, compared with 3.4% in the corresponding period last year.

Assets under management

During the Reporting Period, Clal Pension and Provident Funds' assets under management increased mainly as a result of returns on assets in the Reporting Period. In addition, there was a significant increase in income from management fees, both in pension funds and in provident funds compared with the corresponding reporting period last year. For further details, see Section 2.2.1.3 and 2.2.1.4 below.

Assets under management by the Group as of September 30, 2024 totaled approx. NIS 361 billion compared with approx. NIS 338 billion on December 31, 2023 - an increase of approx. 7%.

Out of the total said assets, as of September 30, 2024 approx. NIS 137 billion are assets under management of the new pension fund compared to approx. NIS 120 billion on December 31, 2023 - an increase of approx. 14%.

The results in the Reporting Period and in the corresponding periods last year, respectively, as detailed below, include, among other things, the Special Items listed below:

		1-9		7-9	For
	2024	2023	2024	2023	2023
In NIS million			Unaudited		Audited
Life Insurance
Change in discount rate used in calculation of pension reserves	32	62	(2)	20	124
Income from change in the pension reserves due to the increase in expected future income (K factor)	-	159	-	209	260
Total effect of changes in interest on liabilities for annuities	32	221	(2)	229	384
Change in the mortality assumptions in the calculation of the liabilities for annuities	(128)	-	-	-	-
Changes to other assumptions in the calculation of the liabilities for annuities	69	-	-	-	67
Estimated effects of the Iron Swords War	-	-	-	-	(74)
Total Special Items - life insurance	(27)	221	(2)	229	377
Financial effects on P&C insurance reserves	42	123	(9)	36	83
Total Special Items - P&C insurance	42	123	(9)	36	83
Long-term care in the Health Segment
Financial effects in the Liability Adequacy Test (LAT) reserve	35	-	-	-	-
Changes in actuarial assumptions for incidence of long-term care claims	-	-	-	-	(102)
Total long-term care in the Health Insurance Segment	35	-	-	-	(102)
Total Special Items prior to consolidation	50	344	(11)	36	358
Consolidation entry - Max's credit loss expenses	-	(220)	-	-	(220)
Total Special Items before tax	50	124	(11)	265	138

B. Company's results in the quarter

The post-tax comprehensive income in the quarter amounted to approx. NIS 271 million, compared with a comprehensive income of approx. NIS 151 million in the corresponding period last year.

Insurance and savings without financial effects on reserves

In the quarter, total income in respect of the insurance and savings segments without financial effects on the pre-tax liabilities amounted to approx. NIS 92 million, compared with a loss of approx. NIS 32 million in the corresponding period last year.

Underwriting results and savings assets under management:

During the quarter, there was an improvement in underwriting income - primarily in the Property and Casualty Segment and in the Health Insurance Segment, compared to the corresponding period last year, as detailed below in Sections 2.2.1-2.2.3.

In addition, during the quarter there was an increase in contributions towards benefits provided by the pension funds subsegments; on the other hand, there was a decrease in proceeds from investment contracts that stem, among other things, from volatility in capital markets, such that the total gross premiums earned, the contributions towards benefits, and proceeds from investment contracts amounted to approx. NIS 6.8 billion, compared with the corresponding period last year.

Investment income and the capital markets:

In the quarter, capital markets provided higher returns compared to the corresponding period last year, which affected the returns achieved by the Company, such that a positive financial margin of approx. NIS 177 million was recognized in life insurance, as well approx. NIS 311 million in investment income not allocated to segments, compared with approx. NIS 93 million in financial margin in life insurance and approx. NIS 32 million in unallocated investment losses in the corresponding period last year.

It should be noted that in view of the negative real returns in the capital markets last year, in the Reporting Period and in the corresponding period last year the Company did not collect variable management fees; the Company has a liability to policyholders of approx. NIS 0.3 billion in respect of negative returns on the portfolio of life insurance participating policies, and until it meets this undertaking Clal Insurance will not collect variable management fees.

Credit cards

The total income from credit cards in the Reporting Period amounted to approx. NIS 103 million before tax compared to approx. NIS 80 million in the corresponding period last year.

Max's income in this period amounted to approx. NIS 595 million, compared to approx. NIS 567 million in the corresponding period last year, reflecting the continued growth in Max's activity. Of which, Max's total income from credit card transactions totaled approx. NIS 385 million, compared to approx. NIS 364 million in the corresponding period last year. The turnover of Max's domestic activity was up in the third quarter of 2024 compared to the corresponding period last year - an increase which led to an increase in Max's income from credit card transactions, both on the issuance side and on the acquiring side. However, this increase was partially offset by a decrease in tax income from overseas fees and commissions, due to the decrease in inbound and outbound tourism activity following the War.

Max's net interest income increased and amounted to approx. NIS 206 million compared to approx. NIS 202 million in the corresponding period last year, mostly due to the increase in Max's business credit activity, with 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.

Credit loss expenses amounted to approx. NIS 62 million, compared with an expense of approx. NIS 86 million in the corresponding period last year.

Max's operating expenses for the third quarter of 2024 amounted to NIS 238 million compared to NIS 219 million in the corresponding period last year.

Return on equity

In the quarter, the return on equity in annual terms was a positive 12.2%, compared with 7.2% in the corresponding period last year.

C. Amortization of excess cost at Max

The amortization of excess cost in Max's acquisition was carried out based on an excess cost allocation study. For details regarding the balance of excess costs in respect of acquired identifiable assets and liabilities, the manner of their reduction, and their effect on the Company's results, see Note 5 to the Consolidated Interim Financial Statements.

2.2.1 Long-term savings

2.2.1.1 Life Insurance Subsegment

Life Insurance	1-9		7-9
	2024	2023	2024	2023
Premiums earned, gross	3,866	4,681	1,274	1,483
Comprehensive income (loss)	(107)	105	(38)	100
The redemption rate of the life insurance policies out of average reserve in annualized terms	1.8%	1.8%	1.8%	1.9%

Comprehensive income:

In the Reporting Period and in the quarter - the decrease in income in the Reporting Period and in the quarter arises mainly from a decrease in reserves due to the increase in risk-free interest plus illiquidity premium and additional financial effects, which was offset mainly by higher returns in the capital markets compared to the corresponding period last year, which affected the returns achieved by the Company. In addition, in the Reporting Period there was an increase in reserves due to revision of actuarial assumptions.

Reporting Period - the results were mainly affected by the following factors:

Updates of assumptions of the actuarial models:

In the Reporting Period, an increase of approx. NIS 59 million was recorded in the reserve due to the revision of actuarial assumptions in view of the revision of mortality tables for pensioners, offset by the effects of revisions to the pension uptake rate upon retirement, which allow the receipt of an annuity according to guaranteed conversion rates, without a similar effect on the corresponding period last year.

Financial effects, investment income and the capital markets:

In the Reporting Period there was a decrease of approx. NIS 32 million in reserves due to the increase in the risk-free interest rate, plus the illiquidity premium, and other financial effects, compared to an approx. NIS 221 million decrease in reserves in the corresponding period last year.

This effect was mainly offset against higher returns in capital markets compared to the corresponding period last year, which affected the returns achieved by the Company, such that a positive financial margin of approx. NIS 523 million was recorded in Life Insurance in the Reporting Period, compared to a financial margin of approx. NIS 474 million in the corresponding period last year.

Quarter - the results were mainly affected by the following factors:

Financial effects, investment income and the capital markets:

During the quarter there was an approx. NIS 2 million increase in reserves due to an increase in the risk-free interest rate and other financial effects, compared to an approx. NIS 229 million decrease in reserves in the corresponding quarter last year.

This effect was mainly offset against higher returns in capital markets compared to last year, which affected the returns achieved by the Company, such that a positive financial margin of approx. NIS 177 million was recorded in Life Insurance in the Reporting Period, compared to a financial margin of approx. NIS 93 million in the corresponding quarter last year.

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):

Life Insurance	1-9		7-9
	2024	2023	2024	2023
Investment gains credited to policyholders net of
management fees	6,641	2,986	3,199	87

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

	1-9		7-9	For the year
In NIS million	2024	2023	2024	2023	2023
Variable management fees*)	-	-	-	-	-
Fixed management fees	444	446	148	148	594
Total management fees	444	446	148	148	594
Total financial margin and management fees	523	474	177	93	658
Current premiums	3,511	3,860	1,149	1,266	5,079
One-off premiums	355	821	125	217	962
Total premiums earned, gross	3,866	4,681	1,274	1,483	6,041
Current premiums	72	67	24	24	91
One-off premiums	518	866	225	177	990
Total premiums in respect of pure savings	590	933	249	201	1,081

*) As of September 30, 2024, the liability to policyholders in respect of negative returns on the portfolio of participating policies amounts to approx. NIS 0.3 billion (as of December 31, 2023 - approx. NIS 0.6 billion).

Details regarding the rates of return on participating policies

In NIS million		Policies issued in 1992-2003 (Fund J)
	1-9		For the year	Q3		For the year
	2024	2023	2023	2024	2023	2023
Real return before payment of management fees	5.20	0.81	3.03	2.47	(0.38)	3.03
Real return after payment of management fees	4.74	0.38	2.43	2.31	(0.52)	2.43
Nominal return before payment of management fees	8.91	4.09	6.48	4.09	0.39	6.48
Nominal return after payment of management fees	8.43	3.63	5.86	3.94	0.24	5.86

			For the
In NIS million	1-9		year	Q3		For the year
	2024	2023	2023	2024	2023	2023
Real return before payment of management fees	5.17	1.14	3.53	2.49	(0.46)	3.53
Real return after payment of management fees	4.45	0.44	2.66	2.25	(0.69)	2.66
Nominal return before payment of management fees	8.87	4.42	6.99	4.11	0.30	6.99
Nominal return after payment of management fees	8.13	3.70	6.10	3.88	0.07	6.10

Policies issued from 2004 and thereafter (the new Fund J)

2.2.1.3 Provident funds subsegment

In NIS million		1-9
	2024	2023	2024	2023
Comprehensive income	6	7	1	4
Contributions towards benefits	3,360	3,395	1,126	1,173

Reporting period - the decrease in the comprehensive income in the Reporting Period arises from an increase in income from management fees as a result of an increase in total assets under management, mainly due to the positive returns recorded in the capital markets in the period, offset by an increase in general and administrative expenses.

Quarter - the decrease in comprehensive income in the current quarter compared to the corresponding quarter last year arises mainly from the loss arising from the supplementation of return to planholders of guaranteed-return provident fund and an increase in general and administrative expenses, which is offset against an increase in investment income in the nostro portfolio due to the positive returns recorded in the capital market over the period.

Contributions towards benefits - provident

2.2.1.4 The pension subsegment

	1-9
In NIS million	2024	2023	2024	2023
Comprehensive income	37	38	13	18
Contributions towards benefits	7,796	7,277	2,700	2,580

Reporting Period and quarter - the decrease in comprehensive income in the Reporting Period arises from an increase in income from management fees, mainly from assets under management, offset by an increase in agents fees and general and administrative expenses due to the increase in activity. In addition, in the Reporting Period and the Quarter there was an increase in investment income from the nostro portfolio due to the positive returns recorded in capital markets in the period.

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 In 2023, a trend began which moderated into the reporting period, of an increase in redemptions from short- and mid-term savings products, which are managed by the institutional entities (financial savings policies, investment provident funds, and advanced education funds). In the Company's opinion, this increase stems from a number of factors, including the interest rate environment and the conditions in the markets in Israel and across the world, customers' needs, the cost of living, and investment alternatives arising from the high-interest rate environment. At this stage, the Company is unable to estimate whether the said growth trend is persistent or temporary. Furthermore, there was an increase in funds transferred from the Company's savings products. For further details on 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

		1-9		Q3
	2024	2023	2024	2023
P&C insurance
Gross premiums	3,154	2,859	1,008	954
Comprehensive income	431	258	74	126

Reporting period and quarter - The increase in premiums arises mainly from the increase in average premium in compulsory motor and motor property insurance and an increase in insurance of corporations.

Reporting Period - the improvement in income in the Reporting Period compared to the corresponding period last year arises mainly from a significant underwriting improvement, and - on the other hand reserves were reduced due to the effect of the interest rate environment amounting to approx. NIS 42 million compared to a reduction of approx. NIS 123 million in reserves in the corresponding period last year.

Quarter - there was a marked underwriting improvement and on the other hand, reserves were increased due to the approx. NIS 9 million effect of the interest rate environment along with an approx. NIS 36 million reduction in reserves in the corresponding period last year. In addition, in the corresponding period last year insurance liabilities in the Sale Law Guarantee Subsegment decreased by approx. NIS 39 million.

Motor property		1-9		Q3
	2024	2023	2024	2023
Gross premiums	1,074	877	369	324
Comprehensive income (loss)	81	(64)	28	5
Gross LR	69%	88%	69%	77%
LR- retention	69%	86%	69%	76%
Gross CR	94%	113%	95%	102%
CR - retention	95%	113%	96%	101%

Reporting Period and quarter - the increase in premiums is mainly affected by an increase in the average premium.

Reporting period - The transition from loss to income in the Reporting Period compared to the corresponding period last year stems mainly from an underwriting improvement due to the increase in the average premium as stated above and developments with respect to prior periods. On the other hand, reserves were increased due to the effect of the interest rate environment amounting to approx. NIS 8 million compared with a reduction of approx. NIS 18 million in reserves in the corresponding period last year.

Quarter - the improvement in income stems mainly from an underwriting improvement due to the increase in the average premium as stated above and developments with respect to prior periods.

	1-9		Q3
Compulsory motor insurance	2024	2023	2024	2023
Gross premiums	621	565	226	205
Comprehensive income	88	67	3	28

Reporting period and quarter - The increase in premiums in the reporting period stems mainly from an increase in the average premium.

Reporting Period - the improvement in income in the Reporting Period compared to the corresponding period last year arises mainly from positive developments in respect of previous periods (including netting agreement with the National Insurance Institute); on the other hand, reserves were increased due to the effect of the interest rate environment amounting to approx. NIS 3 million compared to a reduction of approx. NIS 48 million in reserves in the corresponding period last year.

Quarter - the decrease in income in the quarter compared to the corresponding quarter last year arises mainly from an increase in reserves due to the effect of the interest rate environment amounting to approx. NIS 7 million compared to a reduction of approx. NIS 19 million in reserves in the corresponding period last year and due to a decrease in investment income.

	1-9		Q3
Property and other subsegments	2024	2023	2024	2023
Gross premiums	984	904	278	281
Comprehensive income	110	133	34	77
Gross LR	42%	16%	58%	(2)%
LR- retention	26%	3%	31%	(38)%
Gross CR	60%	37%	77%	18%
CR - retention	49%	34%	58%	(12)%

Reporting Period - The increase in premiums arises mainly from an increase in corporations' policies.

Reporting Period and quarter - the lower income compared to last year arises mostly from a decrease of approx. NIS 39 million in insurance liabilities in the Sale Law Guarantee Subsegment, which was carried out in the corresponding periods last year.

	1-9		Q3
Credit Insurance	2024	2023	2024	2023
Gross premiums	105	102	36	34
Comprehensive income	38	30	19	7
LR- retention	24%	24%	20%	32%
CR - Retention	51%	49%	48%	58%
	1-9		Q3
Liability subsegments	2024	2023	2024	2023
Gross premiums	371	411	99	110
Comprehensive income	114	92	(11)	10

Reporting period and quarter - The decrease in premiums arises mainly from a decrease in premiums in officers insurance policies.

Reporting Period - the improvement in underwriting income arises - among other things - from an improvement in the development of claims in respect of previous years compared to the corresponding period last year, and from an increase in the average premium. On the other hand, reserves were reduced due to the effect of the interest rate environment amounting to approx. NIS 53 million compared with a reduction of approx. NIS 57 million in reserves in the corresponding period last year.

Quarter - breaking even in the quarter arises mainly from an increase in reserves due to the effect of the interest rate environment amounting to approx. NIS 3 million compared to an approx. NIS 14 million decrease in reserves in the corresponding period last year.

2.2.3 Health insurance

		1-9		7-9
	2024	2023	2024	2023
Premiums earned, gross	1,377	1,306	485	457
Comprehensive income (loss)	120	(3)	32	(15)

Premiums earned, gross:

Reporting Period and quarter - an increase was recorded in premiums mainly in the individual insurance activity. This effect was offset against a decrease in the volume of activity in the travel insurance subsegment, due to the Iron Swords War.

Comprehensive income:

Reporting Period - comprehensive income in the Reporting Period arises mainly from breaking even in underwriting activity compared to an underwriting loss in the corresponding period last year in the individual insurance subsegments, a release of approx. NIS 35 million in liabilities in respect of the Liability Adequacy Test (LAT) due to the effect of the interest rate environment on the long-term care subsegment, and an increase in investment income compared to the corresponding period last year. These effects were offset against a decrease in income in the travel insurance subsegment compared to the corresponding period last year due to the Iron Swords War.

Quarter - comprehensive income in the quarter arises mostly from substantial improvement in underwriting income in the individual subsegments and from an increase in investment income compared with the corresponding quarter last year.

	1-9		7-9
	2024	2023	2024	2023
Long-term care subsegment - Comprehensive income (loss)
Individual	61	(2)	4	4
Collective insurance - including health maintenance organizations	(2)	(7)	-	(11)
Illnesses and hospitalization subsegment - comprehensive income (loss)
Long-term	62	(4)	20	(20)
Short-term	(1)	10	9	12

Individual long-term care:

Reporting Period - comprehensive income in the Reporting Period arises mainly from an increase in investments and from a release of approx. NIS 35 million in liabilities in respect of the Liability Adequacy Test (LAT) due to the effect of the interest rate environment on the long-term care subsegment in the corresponding period last year.

Illnesses and long-term hospitalization:

Reporting Period and quarter - the increase in income in the Reporting Period and quarter arises from a significant improvement in underwriting income compared to the corresponding period and quarter last year.

Illnesses and short-term hospitalization:

Reporting Period and quarter - the decrease in income in the Reporting Period arises from a decrease in the volume of activity in the travel insurance subsegment, due to the Iron Swords War.

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

	Individual and collective participating long-term care insurance policies
	1-9		7-9		For the year
In NIS million	2024	2023	2024	2023	2023
Investment income credited to policyholders	101	44	48	4	70

2.2.4. Credit cards

	1-9		7-9
	2024	2023 *)	2024	2023
Total income from the Credit Cards Segment	1,151	1,708	416	595
Total pre-tax income	309	237	103	80
Credit card transactions (Max) (see also Section 2.2.4.1)
Revenues
Income from credit card transactions	1,057	1,029	385	364
Interest income, net	601	587	206	202
Other revenues	10	7	4	1
Total revenues	1,668	1,623	595	567
Expenses
Credit loss expenses	159	188	62	86
Operating expenses	658	673	238	219
Selling and marketing expenses (see Section 2.2.5 below)	326	292	117	104
General and administrative expenses (see Section 2.2.5 below)	59	64	20	19
Payments to banks	173	171	61	59
Total expenses	1,375	1,388	498	487
Pretax income	293	235	97	80
Technological activity (Milo)
Income from credit card transactions	94	85	31	28
Pretax income	16	2	6	-

*) The Company consolidated Max's results for the first time starting on April 1, 2023, such that the data for 1-9 2023 also include the data for the 1st quarter of 2023, are presented for comparison purposes only and were not consolidated in the Company's financial statements.

Income 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 income from merchants net of fees and commissions to other issuers. The turnover of Max's domestic activity was up in the first quarter of 2024 compared to the corresponding period last year - an increase which led to an increase in its income from credit card transactions, both on the issuance side and on the acquiring side. However, this increase was offset by a decrease in tax income from overseas fees and commissions, due to the decrease in inbound and outbound tourism activity following the War.

Max's net interest income remained unchanged in view of responsible and sound management of the increase in Max's 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.

The decrease in credit loss expenses is due to the fact that - during the first quarter of the year - the quality of Max's credit portfolio improved and the increase in the credit portfolio was more moderate compared to the first quarter last year - during which there was also an increase in the outstanding balance of troubled debts. These effects were partially offset by higher write-offs during the first quarter of the year compared to the first quarter of last year.

Max's operating expenses in the Reporting Period and quarter declined compared to the corresponding periods last year (net of one-off effect); the decrease is mainly attributed to a decrease in payments to international organizations.

2.2.4.1 Data by areas of activity - Max

	1-9	1-9 *)	Rate of change
	2024	2023
Total credit card transactions (Max)
Revenues	1,668	1,623	3%
Comprehensive income	293	235	25%
Of which - issuance activity
Operating income from credit cards	857	821	4%
Interest income	429	425	1%
Total revenues	1,296	1,252	4%
Operating, marketing and general and administrative expenses	858	818	5%
Credit loss expenses	152	165	(8%)
Payments to banks	173	171	1%
Total expenses	1,183	1,154	3%
Comprehensive income, before tax	113	98	5%
Of which - acquiring activity
Operating income from credit cards	200	208	(4%)
Interest income	172	162	6%
Total revenues	372	371	0%
Operating, marketing and general and administrative expenses	185	211	(12%)
Credit loss expenses	7	23	(70%)
Total expenses	192	234	(18%)
Comprehensive income, before tax	180	137	32%

*) The Company consolidated Max's results for the first time starting on April 1, 2023, such that the data for 1- 9 2023 also include the data for the 1st quarter of 2023, are presented for comparison purposes only and were not consolidated in the Company's financial statements.

	7-9	7-9	Rate of
	2024	2023	change
Total credit card transactions (Max)
Revenues	595	567	5%
Comprehensive income	97	80	32%
Of which - issuance activity
Operating income from credit cards	316	293	8%
Interest income	146	146	0%
Total revenues	466	440	6%
Operating, marketing and general and administrative expenses	310	277	12%
Credit loss expenses	59	68	(13%)
Payments to banks	61	59	3%
Total expenses	430	404	6%
Comprehensive income, before tax	36	36	0%
Of which - acquiring activity
Operating income from credit cards	69	71	(3%)
Interest income	60	56	7%
Total revenues	129	127	2%
Operating, marketing and general and administrative expenses	65	65	0%
Credit loss expenses	3	18	(83%)
Total expenses	68	83	(18%)
Comprehensive income, before tax	61	44	63%

2.2.4.2 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.

		For the nine-month period ended		For the three-month period ended
	September 30, 2024	September 30, 2023 *)	September 30, 2024	September 30, 2023	December 31, 2023
Banking cards	59,912	56,551	21,069	19,531	73,672
Non-banking cards	43,769	37,334	15,976	13,478	48,666
Total	103,681	93,885	37,045	33,009	122,338

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

2.2.4.3 Key credit quality indicators

	As of
Main credit quality indicators (in %)	September 30, 2024	December 31, 2023	September 30, 2023
Rate of balance of credit loss provision of the balance of receivables for credit card transactions	2.30%	2.65%	2.53%
Rate of non-accruing receivable balance of receivables for credit card transactions	1.20%	1.26%	1.16%
Rate of net write-offs of the average balance of receivables for credit card transactions	1.46%	1.13%	0.97%

2.2.5 Other and items not included in the insurance and credit cards segments

	1-9		7-9
In NIS million	2024	2023	2024	2023
Total comprehensive income (loss) before tax	328	58	301	(40)

Reporting Period - the increase in income arises mainly from approx. NIS 348 million in investment income compared to approx. NIS 82 million in investment income in the corresponding period last year.

Quarter - the transition to profit stems mainly from approx. NIS 311 million in investment gains compared with approx. NIS 32 million in investment losses in the corresponding period last year.

2.2.6 Operating and general and administrative expenses and fees and commissions

Insurance and savings

In the Reporting Period and third quarter, expenses remained at their level as of the corresponding period last year. Total general, administrative and operating expenses and fees and commissions expenses totaled approx. NIS 2,454 million in the Reporting Period, similar to the approx. NIS 2,341 million last year, and in the quarter - a total of approx. NIS 859 million, similar to the approx. NIS 782 million in the corresponding quarter last year, despite an increase in expenses affected by inflation and the increase in business activities.

In the Reporting Period, there was a relative increase in the level of expenses compared to income mainly due to a decrease in contributions in the financial savings products in view of the conditions in the markets.

Rate of expenses and fees and commissions in relation to income*

* The income includes premiums, contributions towards benefits and proceeds in respect of investment contracts.

Credit cards

	For the nine months ended on September 30
	2024	2023*)	Change
In NIS million	In NIS million		In NIS million	In %
Selling and marketing expenses	326	284	42	15%
General and administrative expenses	59	58	1	2%
Total	385	342	43	13%

	For the three months ended September 30
	2024	2023	Change
In NIS million	In NIS million		In NIS million	In %
Selling and marketing expenses	117	104	13	13%
General and administrative expenses	20	19	1	5%
Total	137	123	14	11%

	For the nine months ended September 30
	2024	2023*)	Change
In NIS million	In NIS million		In NIS million	In %
Operating expenses for credit cards	658	652	6	1%

	For the nine months ended September 30
	2024	2023*)	Change
In NIS million	In NIS million		In NIS million	In %
Operating expenses for credit cards	238	219	19	9%

Operating expenses

Max's operating expenses in the Reporting Period and quarter declined compared to the corresponding periods last year (net of one-off effect); the decrease is mainly attributed to a decrease in payments to international organizations.

2.2.7 Finance expenses in activity not allocated to segments

Reporting period - In the Reporting Period, finance expenses amounted to approx. NIS 242 million, compared with approx. NIS 211 million in the corresponding period last year. The increase in the Reporting Period is mainly attributable to the raising of debt by the Company during 2023, at a total amount of approx. NIS 1,549 million in the form of bonds, and a debt of approx. NIS 875 million included in consolidation as part of the Max transaction (syndicated loan). It is noted that part of the proceeds of the issuance of bonds by the Company was used by the Group - in February 2024 - for full early repayment of the syndicated loan, such that CIMax's finance expenses as detailed in the table will be amortized in full as from this date.

Quarter - In the quarter, finance expenses amounted to approx. NIS 78 million, compared with approx. NIS 79 million in the corresponding period last year. The effect in the quarter is mainly attributable to an increase in finance expenses from the raising of debt by the Company during 2023, at a total amount of approx. NIS 1,549 million in the form of bonds, and - on the other hand - a decrease in finance expenses as a result of the repayment of approx. NIS 875 million in debt included in consolidation as part of the Max transaction (syndicated loan).

In NIS million	1-9		7-9
	2024	2023	2024	2023
Clal Insurance - Tier 2 capital notes	151	137	53	46
Clal Holdings - Bonds	60	18	20	10
CIMax *)	16	43	-	20
Other (mainly IFRS 16)	15	13	5	3
Total	242	211	78	79

2.3 Key Data from the Consolidated Statements of Financial Position

Following are key data from the consolidated balance sheets (in NIS billion):

Liabilities for insurance contracts and yielddependent investment contracts
Yield-dependent assets
Other assets
Receivables for credit card transactions, net
Equity Other liabilities
Payables for credit card transactions

2.3.1 Assets

Total assets as of September 30, 2024 amounted to approx. NIS 168.6 billion, compared with approx. NIS 163.6 billion as of December 31, 2023 and approx. NIS 164.5 billion as of September 30, 2023.

Following are key asset line items for Max:

	As of	As of	As of
	September 30	December 31	September 30
In NIS million	2024	2023	2023
Receivables for credit card transactions	16,550	14,481	15,061
Of which: Credit balance not guaranteed by banks	15,976	13,908	14,491
Of which: Credit card receivables for private individuals	4,492	3,453	3,806
Of which: balance of credit to private individuals	10,069	9,222	9,418
Amounts receivable from banks for credit card transactions, net	1,210	1,088	1,114

2.3.2 Liabilities

Total liabilities as of September 30, 2024 amounted to approx. NIS 159.4 billion, compared with approx. NIS 155.0 billion as of December 31, 2023 and approx. NIS 156.0 billion as of September 30, 2023.

Following are the changes in liabilities as stated above (in NIS million):

Balance sheet line item	As of September 30, 2024	As of December 31, 2023	Comment
			See Note 10 to the Interim
Payables for credit card transactions	9,616	8,091	Financial Statements
Financial liabilities:
Bonds issued by the Company - par value
component	1,558		1,557 See Section 2.5.4 below.
Bonds and subordinated notes at Max	793		582 See Note 6 to the Interim
Liabilities to banks in Max	5,607		5,202 Financial Statements.
Loan in CIMax and subsidiaries excluding Max	13		888 See Section 2.1(c) above.
Total financial liabilities	7,971	8,229
Total	17,587	16,320

2.3.2.1 Following is a breakdown of Max's off-balance-sheet items:

	As of September 30	As of December 31	As of September 30		Change in %
	2024	2023	2023	From December 2023	From September 2023
Balance of unutilized credit card credit facilities	38,215	34,566	31,954	11%	20%
Of which: Under Max's responsibility	24,751	21,463	19,914	15%	24%
Of which: Under the banks' responsibility	13,461	13,100	12,037	3%	12%

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 November 27, 2024, Clal Insurance approved and published its Economic Solvency Ratio Report as of June 30, 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 that 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 June 30, 2024, the Deduction was made on a linear basis, as required, and stands at NIS 2,883 million.

For further details, 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 capital required for solvency purposes, 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 June 30, 2024.

The solvency ratio as of June 30, 2024 does not include the effect of the business activity of the Company in the period subsequent to June 30, 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 June 30, 2024 was audited by the independent auditors. The review was conducted in accordance with the International Standard on Assurance Engagements (ISAE 3400), Assurance Engagements Other than Audits or Reviews of Historical Financial Information.

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

	As of June 30	As of December 31
	2024	2023
In NIS million	Unaudited	Audited
Shareholders equity in respect of SCR	14,830	14,019
Solvency capital requirement (SCR)	8,888	8,976
Surplus	5,942	5,043
Economic solvency ratio (in %)	167%	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)	(455)	460
Deviation from quantitative limitation	-	(169)
Shareholders equity in respect of SCR	14,439	14,311
Surplus	5,551	5,337
Economic solvency ratio (in %)	162%	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 June 30	As of December 31
	2024	2023
In NIS million	Unaudited	Audited
Minimum capital requirement (MCR)	2,222	2,244
Shareholders equity for MCR	10,830	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.

the Transitional Period	As of June 30	As of December 31
	2024	2023
In NIS million	Unaudited	Audited
Shareholders equity in respect of SCR	12,461	11,268
Solvency capital requirement (SCR)	9,890	10,383
Surplus	2,571	885
Economic solvency ratio - in %	126%	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	-	460
Deviation from quantitative limitation	-	(460)
Shareholders equity in respect of SCR	12,461	11,268
Surplus	2,571	885
Economic solvency ratio - in %	126%	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, in relation to the Board of Directors' target (see Section B below):
The Board of Directors' economic solvency ratio target (%)	110%	110%
Capital surplus (shortfall) in relation to the target	1,582	(153)

Solvency ratio without applying the Provisions for

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.[1] Determination of the optimal value is supposed to be based on the distribution of the estimated possible outcomes (hereinafter - "Stochastic Models") and in the absence of clear statistical data suitable for estimating the optimal estimated distribution, Clal Insurance used the expectancy of each relevant factor (hereinafter - "Deterministic Models").

As part of continued development and upgrade of the calculations, in the reporting period Clal Insurance simultaneously calculated the best estimate of asymmetric insurance liabilities (including recognition of future variable management fees,[2]) which if it had been included in the calculation of the economic solvency ratio as of June 30, 2024, its effect is estimated by adding approx. 17%, without taking into consideration the Provisions for the Transitional Period, and by adding approx. 9% taking into consideration the Provisions for the Transitional Period.

In accordance with the framework received from the Commissioner in November 2023, the Stochastic Model will not be applied in the solvency ratio calculation without application of the Provisions for the Transitional Period, for 3 reporting dates, but Clal Insurance will add disclosure of its effect in the Economic Solvency Ratio Report. At this stage, Clal Insurance chose not to include this in the calculation that takes into consideration the Provisions for the Transitional Period either.

It is noted that this figure is not audited nor reviewed and is sensitive to changes in the interest rate curve and other financial and demographic assumptions and will be recalculated in each reporting period.

In view of the above, as from the report as of December 31, 2024, it will be allowed to include the Stochastic Model in the calculation of solvency ratio, subject to completion of an audit of the Capital Market Authority.

As aforesaid, Clal Insurance completed the stochastic calculation based on application of the Economic Generator Scenario,[3] including completion of tests and control processes for accuracy, robustness and market compatibility, as is customary in companies abroad that apply Stochastic Models to calculate 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. For the purpose of building the Stochastic Model, Clal Insurance chose appropriate economic models for its types of assets. In choosing, calibrating and testing these economic models, Clal Insurance used international consulting companies. In addition, the independent auditors reviewed the calculation process and internal controls.

5. The Company and Clal Insurance's Dividend Distribution Policy and Capital Target

For details regarding the Company and Clal Insurance's dividend distribution and capital target, 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 regarding Reporting to the Commissioner of Capital Market about Own Risk and Solvency Assessment of an Insurance Company (ORSA) were published.

^[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] See Section 6.1.2.3 in the Report on the Corporation's Business of the Company

^[3] As defined in the provisions of Section B, Chapter 5 (Part 2, Section 2) of the Provisions of the Economic Solvency Regime.

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. Issuance of Subordinated Notes (Series M) and exchange of Series J

In January 2024, approx. NIS 504 million p.v. in Notes (Series J) were exchanged by way of an exchange tender offer in consideration for the issuance of approx. NIS 508 million p.v. in Notes (Series M), by way of expansion of an existing series. The Notes (Series M) were recognized (subject to restrictions) as Tier 2 capital of Clal Insurance, instead of Notes (Series F), that were exchanged, and which were recognized as hybrid Tier 2 capital.

In April 2024, the Company issued to the public NIS 465 million p.v. in Notes (Series M) by way of expansion of an existing series in consideration for approx. NIS 460 million. The terms and conditions of the additional notes are identical to the terms and conditions of the Notes (Series M) in circulation. For further details, see Note 6 to the Financial Statements.

B. Capital requirements and capital adequacy in Max

1. Equity and capital adequacy

Max's reported equity capital amounted to NIS 1,997 million as of September 30, 2024, compared to NIS 1,847 million at the end of 2023 - an approx. 8% increase, which arises from the income for the period, and compared to NIS 1,808 million on June 30, 2023 - an increase of approx. 10%. The equity capital as of the end of the third quarter of 2024 includes NIS 26 million in share capital, NIS 376 million in share premiums, a NIS 83 million capital reserve, NIS 10 million in accumulated other comprehensive loss, and NIS 1,522 million in retained earnings.

At the end of the third quarter of 2024, Common Equity Tier 1 capital amounted to NIS 2,002 million, compared to NIS 1,855 million as of December 31, 2023, and compared to NIS 1,812 million on September 30, 2023.

At the end of the third quarter of 2024, total capital amounted to NIS 2,462 million, compared to NIS 2,316 million as of December 31, 2023, and compared to NIS 2,420 million on September 30, 2023.

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 September 30, 2024, CET1 capital ratio amounted to 10.0%, compared to 11.0% as of the end of 2023, and 10.6% on September 30, 2023. As of September 30, 2023, total capital to risk-weighted components ratio amounted to 12.3%, compared to 13.7% at the end of 2023, and 14.1% on September 30, 2023.

The decrease in the Company's capital ratios at the end of the third quarter of 2024 compared to December 31, 2023 arises mainly from an increase in risk-weighted assets in respect of some of the Company's exposures to Israeli banks due to the downgrade of the rating of the State of Israel by S&P in April 2024, a significant increase in the credit cards activity turnovers compared to turnovers as of the end of 2023, which were lower than usual due to the effect of the War, and a dividend distribution of NIS 62 million in July 2024. The abovementioned effects were partially offset by the increase in equity due to the net income recorded during the period.

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 is studying the effects of the revised directive on the calculation of the capital requirements.

Max's leverage ratio as of September 30, 2024 is 8.6%, compared to 9.1% at the end of 2023 and 8.7% as of September 30, 2023.

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%.

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.

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 September 30		As of September 30		As of December 31
		2024		2023
In NIS million	(Unaudited)			(Audited)
	Risk weighted assets	Capital require ments	Risk weighted assets	Capital require ments	Risk weighted assets	Capital require ments
Credit risks - standardized approach
of banking corporations	1,202	138	648	75	638	73
of corporations	1,649	190	1,446	166	1,479	170
Retail to individuals	11,395	1,310	10,162	1,169	9,882	1,136
of small businesses	1,393	160	1,231	142	1,174	135
Other assets	1,049	121	859	99	847	97
Credit valuation adjustment (CVA)		-	‐	1 -	1	-
Total credit risk	16,688	1,919	14,347	1,651	14,021	1,611
Market risk - standardized approach	116	13	53	6	19	2
Operational risk - standardized approach	3,234	372	2,777	319	2,876	331
Total risk-weighted assets and capital requirements	20,038	2,304	17,177	1,976	16,916	1,944
Capital base	2,462		2,420	‐	2,316
Total capital ratio	12.29%		14.10%		13.69%
CET1 capital ratio	9.99%		10.60%		10.97%

* 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 the second quarter of 2024 Max agreed to the cancellation of restrictions on dividend distribution, which were included in the company's financing agreements.

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.

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 1,020 million; most of the amount arises from realization of financial investments by the Insurance Company and from a tax refund. The consolidated cash flows provided by investing activities amounted to approx. NIS 590 million in the Reporting Period, mainly from disposal of financial assets in the Company for the purpose of repaying the syndicated loan in CIMax. The consolidated cash flows used for financing activities amounted to approx. NIS 1,310 million in the Reporting Period and included mainly the repayment of the syndicated loan in CIMax totaling approx. NIS 891 million; for further details, see 2.1(c) above. The Group's cash and cash-equivalent balances increased from a total of approx. NIS 6,966 million at the beginning of the Reporting Period to approx. NIS 7,258 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.5 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 7 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 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 73 million immediately prior to the reports publication date; furthermore, Clal Finance also has an option to purchase approx. 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, following the consolidation of Max's data and the preparations made to finance its acquisition, the Group has three types of financial liabilities, subordinated notes that were issued to address Clal Insurance's capital needs, and balances used in Max's operating activities, approx. NIS 1,520 million in bonds 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 September 30 As of December 31
NIS million	2024	2023
Financial assets
Cash and cash equivalents	11	9
Other financial investments, mainly money market fund and Israeli T-Bills by the Company	140	1,011
Restricted Tier 1 capital instrument of Clal Insurance *)	473	481
Total assets	624	1,501
Less current maturities
Financial liabilities - current **)	-	963
Financial assets less current maturities	624	538
Non-current financial liabilities
Non-current financial liabilities:
Bonds issued by the Company - liability component	1,520	1,514
Deferred payment with respect to the Max transaction	-	-
Other liabilities - loan in CIMax excluding interest **)	-	-
Total liabilities	1,520	1,514
Net financial debt	896	976
Unutilized credit facility***)	250	250

*) The other financial investments include an investment in a Restricted Tier 1 capital instrument of Clal Insurance amounting to NIS 520 million (fair value as of September 30, 2024 is approx. NIS 473 million).

**) In February 2024, CIMax's syndicated loan totaling approx. NIS 891 million was repaid. For further details, see Section 2.1C above.

***) 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 6(e)(1) to the 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. Data on bonds

Series / issuance date	Bonds (Series A)	Bonds (Series A) (expansion)	Bonds (Series A) (second expansion)	Bonds (Series B) (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
Carrying amount as of September 30, 2024 (in NIS)	Approx. NIS 248 million	Approx. NIS 243 million	Approx. NIS 393 million	Approx. NIS 140 million **)	Approx. NIS 496 million
Market value as of September 30, 2024*)	Approx. NIS 246 million	Approx. NIS 247 million	Approx. NIS 395 million	Approx. NIS 131 million	Approx. NIS 487 million
Interest type	Fixed, non-linked	Fixed, non-linked	Fixed, non-linked	Fixed, non-linked	Fixed, non-linked
Nominal interest rate	4.7%	4.7%	4.7%	2.8%	5.25%
Effective interest rate on issuance date	4.9%	5.6%	5.3%	4.9%	5.5%
Listed on the TASE	Yes	Yes	Yes	Yes	Yes
Principal payment dates	February 28, 2028	February 28, 2028	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 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
Interest payable as of September 30, 2024		Approx. NIS 7 million Approx. NIS 7 million Approx.	NIS 11 million	Approx. NIS 2 million Approx.	NIS 11 million
Are the notes convertible	No	No	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	Notes (principal and Notes (principal and interest) are not interest) are not linked to the CPI linked to the CPI and/or to any and/or to any currency currency
Pledged assets	None	None	None	None	None

			Bonds (Series A)	Bonds (Series B)
Series / issuance		Bonds (Series A)	(second	(convertible
date	Bonds (Series A)	(expansion)	expansion)	bonds)	Bonds (Series C)
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 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 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	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	Yes	Yes

*) The market value includes interest accrued as of September 30, 2024.

**) 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.

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

Criterion

Criterion Bonds (Series B) (convertible bonds)

Details of the security into which the bonds may be converted The bonds are convertible into ordinary shares of the Company

Conversion ratio	Every NIS 85 p.v. of the bonds will be convertible into one ordinary Company share
Key terms of conversion, including conditions precedent for the execution of a conversion and any distribution adjustments	The bonds are convertible on each day on which trading takes place on the Stock Exchange through February 18, 2028;
	If during the conversion right period the Company will distribute bonus shares and/or dividend and/or offer shares by way of offering rights, the number of shares arising from the conversion will be adjusted. For further details, see Section 6.3.3 to the deed of trust attached to the shelf offering report of February 9, 2023.

C. Details regarding rating

	Bonds (Series B)
	Bonds (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 up 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 September 30, 2024, 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

* Forecast of the Bank of Israel's Research Department, October 2024

* The December 2024 data represents the consensus of forecasts according to Bloomberg, November 5, 2024

3.1 Key Economic Data:

3.2 Following are 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 the first quarter of 2024 GDP increased by approx. 14%, compared to a contraction of approx. 21% in the fourth quarter of 2023 (each quarter compared to the previous one, annualized), and compared to the entire year in 2023 when GDP increased by 2%. In the second quarter, GDP increased by an annual rate of 1.2%.
	According to the macroeconomic forecast of the Bank of Israel's Research Department (October 2024), GDP is expected to grow by 0.5% in 2024, and by 3.8% in 2025, assuming that the direct economic effect of the fighting will continue through the beginning of 2025.
	As of the end of September 2024, the budget deficit amounted to 8.5% of GDP, compared to 7.6% of GDP in June. The target set in law as of the end of 2024 stands at 6.6%. In accordance with the Bank of Israel's forecast, the government budget deficit in 2024 and 2025 is expected to amount to 7.2% of GDP and 4.9% of GDP, and the debt to GDP ratio is expected to increase to 68% of GDP in 2024, and 69% of GDP in 2025.
	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 4.6% in September 2024. In accordance with the Bank of Israel's forecast, the broad unemployment rate is expected to stand at approx. 3.5% at the end of 2024 and 3.2% in 2025.
	According to the Central Bureau of Statistics' estimates for July 2024, the average wage of a salaried employee continues to rise and has risen by 6% compared to July 2023. The average wage for a salaried employee in current PPPs was NIS 13,591.
	The housing market - housing prices increased for eight consecutive months - a 6.3% increase since the beginning of the year.
	At the beginning of February 2024, the credit rating agency Moody's announced the downgrade of the credit rating of Israel by one notch to A2 with a negative outlook. A couple of months later, the rating agency S&P announced the downgrade of the rating of Israel by one notch from AA to A+, with a negative outlook, with the agency expressing concerns regarding a full-scale conflict with Iran and an increase in the deficit due to the high expenses of the War. During May, Moody's announced the reiteration of the credit rating and noted that the negative outlook still reflects a significant risk of an escalation in the conflict with Iran. At the beginning of August, the credit rating agency Fitch announced the downgrade of the credit rating of Israel by one notch from A+ to A with a negative outlook, due to the prolongation of the War in Gaza, increased geopolitical risks, and military conflicts in several fronts. In September, the credit rating agency Moody's announced the downgrade of the credit rating of Israel by 2 notches to Baa1.
	At the beginning of October, S&P announced the downgrade of the credit rating of Israel by one notch to A.
Inflation data	In the first nine months of 2024, inflation increased by 3.4%, and in the past twelve months the Consumer Price Index increased by 3.5%, which is outside with the price stability band set in the Bank of Israel Law.
Exchange rates	Upon the outbreak of the War, Israel's risk premium increased sharply, and the NIS has depreciated significantly against the USD and the EUR. Since the beginning of 2024 and through the end of September, the USD has strengthened by approx. 2.3% against the NIS.
Develeopment 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 February, April, May, July and October meetings, the Monetary Committee decided to leave the interest rate unchanged.

In %		1-9		7-9
Share indices in Israel	2024	2023	2024	2023	2023
TA 35	13.8	2.7	7.0	5.5	3.8
TA 90	9.5	4.5	13.3	5.1	4.3
TA 125	12.3	3.4	8.4	5.6	4.1
TA Growth	16.2	0.1	5.3	0.6	3.1
Bond indices in Israel
General	2.1	1.5	2.4	(0.4)	3.8
Tel Bond-CPI Linked	4.5	3.4	2.8	0.4	5.9
Tel Bond-Shekel	2.2	1.5	1.5	0.4	5.3
CPI-Linked Government
Bonds	0.3	(0.9)	3.2	(2.5)	(0.4)
Government - NIS	(0.2)	(0.6)	1.8	(1.0)	1.4
Share indices across the world
Dow Jones	12.0	1.6	7.9	(1.2)	13.5
NASDAQ	20.8	26.6	2.3	(2.7)	43.6
Nikkei Tokyo	13.3	22.1	(4.2)	(4.1)	28.2
CAC Paris	1.2	8.3	2.1	(2.7)	14.8
FTSE London	6.5	1.2	0.9	1.7	3.0
DAX Frankfurt	15.4	9.0	6.0	(3.9)	19.1
MSCI AC	18.7	10.1	6.6	(3.4)	23.1
S&P 500	20.3	12.0	5.1	(2.0)	24.0

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 6 to the Financial Statements.

The third quarter of 2024 was characterized by further subsidence of inflation, the start of interest

economic developments

Global

rate cuts in the United States and Europe, and changes in market pricing to reflect the expected rate of interest rate cuts by the Federal Reserve in the United States. The geopolitical tensions across the world continue; the war between Russia and Ukraine continues with no end in sight, with tensions rising between Israel and Iran, which is accompanies by direct attacks on each other. On the other hand, the effects of the War on the global economy have moderated. In addition, Donald Trump's winning the US presidential elections increases the likelihood that restrictions and tariffs will be imposed on importation from China.

United States - during the third quarter, inflation in the United States subsided slightly to an annual level of 2.4%, and the Federal Reserve cut the interest rate by 50 basis points to 4.75%- 5%; market expectations for interest rate cuts change frequently and currently stand at almost 2 cuts by the end of the year and 5 cuts by the end of 2025. GDP is expected to grow by approx. 2.5% in the third quarter (annualized data has not yet been published); the job market remains strong, with unemployment rate remaining low at 4.2% (as of the end of the quarter), despite a slight subsidence in the increase in the number of new positions that become available every month.

Europe - in the second quarter of 2024, the economy in the Eurozone grew by 0.6% (annualized); it is expected to grow by 0.8% (annualized) in the third quarter of 2024 and effectively exited the technical recession in 2023. During the quarter, the European Central Bank (ECB) continued cutting its interest rate which reached 3.25%, in view of a slowdown in inflation in the EU (annual rate of 1.7% as of September 2024); as of the end of the quarter, it is expected that there will be less than 2 interest rate cuts during 2024. The ECB continues to cut back its bonds purchase plans. The unemployment rate stabilized, standing at 6.4% as of August. Furthermore, as of November 2024, the German government is facing its collapse and elections after budget talks failed; the government will collapse if parliament does not support it in an extraordinary vote to be held in December.

China - the expectation that the Chinese economy will recover has not yet been fulfilled due to many economic challenges, including high youth unemployment rate and a debt crisis among companies, mainly in the real estate sector. The Israeli economy has grown by 5.3% (in annualized terms). However, the government and the People's Bank of China continue to use fiscal and monetary tools to encourage the recovery of the economy. The mutual regulatory restrictions between the United States and China (export of semiconductors to China and use of western semiconductors continue to apply to China).

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 Draft Regulations regarding Economic Competition and Minimizing Market Concentration (Financial Entity) (Amendment No. 1), 2024

Further to Section 9.2.1 to the Description of the Corporation's Business chapter to the Company's Periodic Report of 2023 regarding the Law for the Economic Competition and Minimizing Market Concentration, 2013 (hereinafter - the "Market Concentration Law"), which imposed restrictions on simultaneous holding in financial entities and non-financial entities, regarding the position of the Capital Market Authority and the Taskforce for Assessing Concentration to the effect that an issuing corporation of an insurer should be deemed a financial entity, and regarding the publications on the position of the Market Concentration Committee regarding the definition of an insurer's issuing corporation as a non-financial entity -

In May 2024 the Draft Regulations regarding Economic Competition and Minimizing Market Concentration (Financial Entity) (Amendment No. 1), 2024 was published, as part of which it is suggested to expand the list of entities, which will be included in the definition of "financial entities" in the Market Concentration Law, such that, among other things, it will also include an insurer's issuing corporation.

If the Draft Regulations become binding, this will trigger the definition of Clalbit Finance as a financial entity, such that if the amount of Clalbit Finance's liabilities will not be taken into account together with the other liabilities of the Company and of the non-financial corporations controlled by the Company Group, and the Company will be allowed to continue holding Clal Insurance and Clalbit Finance even if their total liabilities will exceed the threshold of liabilities, which a non-financial entity holding a significant financial entity may have.

4.1.2 Class Actions Bill

Further to Section 9.2.7 to the Description of the Corporation's Business chapter to the Company's Periodic Report of 2023 regarding the recommendations of the Inter-Ministerial Taskforce on Assessing the Arrangements Set in the Class Actions Law, 2006, in May 2024, 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 it is suggested, among other things, to add - in a format of a temporary order - 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, including payment of fees for such advance contact; to set restrictions as to the filing of claims for a remedy in the form of compensation regarding certain types of causes of action and claims; to give the court the power 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 revoke the option to provide a recommendation regarding payment of legal fees to an attorney as part of the settlement agreement; setting a mechanism for selecting the lawsuit and lead attorney by the court in the case of several additional motions on the same issue; to set mechanisms pertaining to compensation between class members, including granting a remedy in kind; to set an orderly mechanism for approval of a settlement agreement by a mediator; to set an outline for ruling legal fees and compensation to the applicant or the lead plaintiff; 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 for the relevant action, the time, which has elapsed since the contract was signed; evidential difficulties; changes in the legislative arrangement since the contract signing date; 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 is also suggested that if a motion will be filed to dismiss the motion to certify for the above reasons, and the court believes that there is merit to the dismissal motion, the Attorney General will be asked to present their position regarding this argument.

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, among other things, on the final wording of the provisions and on the manner by which they are implemented and interpreted by the different courts. However, making the provisions pertaining to conducting legal proceedings regarding breach of the long-term savings contract binding may reduce the Group companies exposure to class actions in this segment.

The Company's assessments regarding the effects of the bill of the Class Actions Law is forward-looking information, which is based on Company's assessments and assumptions as of the report publication date, and the actual outcome may be materially different than predicted, and depends, among other things, on the final wording of the amendment of the Class Actions Law if it is amended, the actual manner of implementation of the provisions of the amendment, and the behavior of various external parties in relation to the provisions of the law.

4.1.3 Amendment 13, Privacy Protection Law, 1981

In August 2024, Amendment No. 13 to the Privacy Protection Law, 1981 was published, which constitutes the most comprehensive revision to the law since it was legislated. The amendment was designed to change the privacy protection legislation in Israel such that it is in line with the current modern legislation generally accepted across the world, and to strengthen and broaden the powers of the Privacy Protection Authority. Among other things, the amendment revised and significantly broadened the definitions regarding data, which is protected under the law ("personal data" and "very sensitive data"); the list of allowed actions that may be taken in relation to the protected types of data was revised and expanded ("database management" and "personal data processing"); the scope of the requirement to register databases was significantly reduced; the requirement to appoint a Data Protection Officer (DPO) in certain entities, including institutional entities was introduced; expanded supervision, investigation and enforcement powers were given to the Privacy Protection Authority, including the power to impose substantial financial sanctions, which will be set as a function of the size of the database, the type of the breach, and the scope of revenues of the breaching entity; the amount of compensation payable without proving damage, which may be claimed in a civil lawsuit was increased, and the prescription period was extended.

The amendment will come into effect one year after its publication date.

Group companies are making preparations for the implementation of the amendment's provisions.

4.1.4 Directive entitled Role of the Board of Directors in the Meeting of the Corporation's Obligations in Accordance with the Privacy Protection Regulations (Information Security)

In September 2024, the Privacy Protection Authority published a directive entitled Role of the Board of Directors in the Meeting of the Corporation's Obligations in Accordance with the Privacy Protection Regulations on the topic of information security.

The directive requires boards of directors of companies where processing of personal information is at the core of their activity to implement monitoring, control, compliance and reporting processes regarding the compliance with the regulations' requirements in the company.

In the said paper, the Authority clarifies and emphasizes the board's responsibility for information security in the organization, including direct responsibility for compliance with the provisions of the law and the regulations, including the requirement to immediately report an information security incident; responsibility for current monitoring and receipt of reports as to compliance with the abovementioned requirements, including, among other things, through an effective internal compliance program, which implements the monitoring requirement set under the directive; a requirement to conduct discussions on topics defined in the directive, and at the frequency set therein.

As part of the directive, the Authority also refers to the circumstances and conditions under which the board may delegate its powers.

4.1.5 Adjudication of Interest and Linkage

Further to the report of the interministerial committee for assessing the interest rates in accordance with the Adjudication of Interest and Linkage Law of October 2021, and further to the amendment to the Adjudication of Interest and Linkage Law of November 2023, which revised the interest and linkage mechanisms applicable to amounts ruled in judgments of judicial authorities, in September 2024 a draft was published of the Adjudication of Interest and Linkage Regulations (Prescribing Annualized Rates of Shekel Interest, Linked Interest and Interest on Arrears, their Calculation and Publication), 2024, which suggests to determine the manner by which the shekel and linked interest rates will be calculated, and a mechanism for the calculation of the rate of interest on arrears.

Furthermore, a draft ordinance was published titled the Adjudication of Interest and Linkage (Deferral of the Effective Date of the Adjudication of Interest and Linkage Law (Amendment No. 9), 2023), 2024, which suggests the deferral of the effective date of the amendment to the Adjudication of Interest and Linkage Law to January 2025.

If the Draft Interest and Linkage Regulations will be published as binding regulations, this may affect Group companies' activity in connection with payment of insurance benefits under insurance policies by increasing the interest component paid in claims filed against the Company (due to the effects of the amendment on the Insurance Contracts Law) and in connection with making of payments in legal proceedings, enforcement proceedings and certain agreements to which the Company is party, and as a result, the Company's liabilities are expected to increase at an immaterial amount.

The Company's assessments regarding the effects of the Draft Interest and Linkage Regulations constitutes forward-looking information, which is based on Company's assessments and assumptions as of the report publication date, and the actual outcome may be materially different than predicted, and depends, among other things, on the final wording of the regulations if and when they are published.

4.1.6 The interim report of the Taskforce for Assessing an Outline for Provision of a Bank License to Non-Bank Entities

In October 2024, an interim report of the Taskforce for Assessing an Outline for Provision of a Bank License to Non-Bank Entities was published, which assessed measures for removal of barriers, which will enable non-bank entities to obtain a bank license in order to be able to raise deposits from the public and provide credit from those deposits.

The taskforce's main recommendations are:

1. Creating two supervisory levels a bank under supervisory level 1 (whose total assets under management amount to up to NIS 50 billion) and a bank under supervisory level 2 (which is not a bank under supervisory level 1), where the supervision and regulation policy will be determined in accordance with the supervisory level with regards to capital requirements and leveraging, liquidity requirements, corporate governance, Reporting to the Public Directives, and directives on reporting to the Banking Supervision Department.
1. Distinguishing between a small bank (the value of whose assets does not exceed 5% of the value of the assets of all banks in Israel or another rate which will be set) and a large bank (which is not a small bank), exempting a small bank from offering all the services that banks are currently required to offer by law, and giving small banks an option to offer partial current account services.
1. Vesting in the Banking Supervision Department the power to exempt a small bank from providing services to high-risk customers and activities
1. Revising the list of operations banks are allowed to engage in based on technological and financial developments and vesting in the Banking Supervision Department the power to determine the list of operations which a small bank is allowed to engage in beyond those currently permitted to banks.
Holding companies, which control institutional entities, will be permitted to control a small bank at the same time, and will not be required to sell such a bank when they exceed the small bank threshold, provided that the growth in the bank's activity is organic in nature and does not arise from further acquisitions. Financial regulators should be vested with supervisory powers over holding companies, which control entities currently under their supervision.

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 non-banking 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.

The information pertaining to the interim report constitutes forward-looking information, which is based on the Company's assessments and assumptions as of the report publication date. Actual implementation may be materially different than expected and depends, among other things, on the final version of the report if and when it is published as a final report, on recommendations which will be adopted, and the manner of their implementation, and the behavior of competitors in all of the Group's activities.

4.2 Long-Term Savings

4.2.1 Investment Track Reform

Further to Section 9.5.5.1(c) to the Description of the Corporation's Business chapter to the Company's Periodic Report of 2023 regarding the provisions of the Investment Tracks in Provident Funds Circular -

In April 2024, an amendment to the Investment Tracks in Provident Funds Circular was published, the key points of which are:

1. Amendment of the list of the investment tracks, which may be managed on the date on which the circular will come into effect - cancelling the provision allowing the setting up of a specializing flexible track and adding the option to set up a combined bonds and shares track (up to 25% shares).
1. Setting restrictions on the investment policy in specific tracks.

The provisions of the Investment Tracks in Provident Funds Circular came into force on July 1, 2024. All required adjustments to the tracks, which were in place in all long-term savings products under the management of the Group's institutional entities were completed on this date.

4.2.2 Demographic assumptions in pension funds and life insurance

In June 2024, a draft circular was published entitled "Amendment of the Consolidated Circular Provisions on Measuring Liabilities - Revising the Demographic Assumptions in Life Insurance and Pension Funds", and in July 2024, a final version of the circular was published. The circular includes a revision to the default assumptions on the basis of which the institutional entities will calculate their liabilities and conversion factors in relation to annuity recipients in pension savings products.

For more information as to the effects of the said amendment, see Note 8(a)(1)(c) to the Consolidated Interim Financial Statements.

4.2.3 Selection of pension funds and default funds

In accordance with the provision of a circular regarding this matter - "Provisions Regarding Selecting Provident Funds" (hereinafter - the "Default Funds Circular") - in August 2024, amendments of the Default Funds Circular and the paper on "Procedure for Selecting Default Funds" were published, which deal with the procedure of selecting the pension funds, which will constitute default funds for a period of four years starting on November 2024 (hereinafter - "Procedure of Selecting Default Funds").

Further to the publication of the Procedure of Selecting Default Funds, in September 2024 the results of a procedure were published, as part of which the four default pension funds which won the procedure in 2021 were selected again, and those funds continue to serve as default funds from November 2024 to November 2028. The management fees in the default funds will stand at 1% of the contributions and

0.22% of the accrual (rates which are identical to management fees rates in the default funds, which operated until the Procedure of Selecting Default Funds), for a period of ten years. As part of the proposed amendment of the Default Funds Circular, it is suggested to prescribe provisions were set regarding the mechanism according to which employers will sign-on to one of the default fund each of their employees, who did not exercise their right to select a provident fund after they were given with an opportunity to do so, i.e. - employers will sign-on such employees to various default funds and will not be able to work only with a single default fund. Furthermore, provisions were set as to the option of converting the rate of management fees of the default funds from fixed management fees to management fees on contributions.

The Amendment to the Default Funds Circular also includes an update as to the default annuity provident fund or advanced education fund, which will be selected as part of a tender to be conducted by the employer. With regard to this procedure, each management company may take part in the process; the criteria of the procedure are a ranking in the service index, returns and management fees, and a criterion was prescribed, which reflects the investment portfolio's risk, will be a mandatory criterion if the employer will opt to include in its tender the criterion of "return of the provident fund under the investments track".

The selection of the default funds is expected to maintain the intense competition in the pension funds market.

The information pertaining to the potential effects of the Default Funds Circular and the results of the Procedure of Selecting Default Funds constitutes forward-looking information, which is based on assessments and assumptions as of the report publication date. Actual implementation may vary materially from that predicted, and depends - to a great extent - on the following factors: The actions to be taken by market players, including Clal Pension and Provident Funds, in order to deal with the increased competition in the market and the changes in market shares and income from management fees; the institutional entities' relationships with the employers and the distributing entities; the way the competing institutional entities conduct themselves; the planholders' preferences and conduct regarding their products; the behavior of the employer and entities rendering them operating services; the effects of other regulatory changes, and their combined effect together with the provisions referred to above.

4.2.4 Withdrawal of Funds from advance education funds

In August 2024, a Bill for the Amendment of the Income Tax Ordinance (No. 274), 2024 was published, which suggests to allow individuals to withdraw funds from an advanced education fund even if 6 years from the date on which the first contribution was made to the fund have not yet elapsed, at a reduced tax rate of up to 15% at most (or at a rate of up to 7.5% to those who reached retirement age and three years from the date on which the first contribution was made to the fund have not yet elapsed); the closer the withdrawal date is to the end of the 6-year period, the lower the applicable tax rate be.

The draft bill may affect the amounts withdrawn from the advanced education fund under Clal Pension and Provident Funds' management.

4.2.5 The increase in the tax benefit available upon withdrawal of an annuity will stop in 2025

Amid the discussions regarding the state budget for 2025-2027, and amid the Draft Government Resolution of September 2024, the Draft Economic Plan and the draft bill for amendment of tax laws, which were published in October 2024, regarding the cancellation of the increase in the tax exemption rate available upon withdrawal of a pension from a pension product, the Histadrut announced that it reached an agreement with the Ministry of Finance to postpone by one year the said increase in the exemption rate (as set forth in the Law for the Amendment of the Income Tax Ordinance (No. 190 and Temporary Order), 2012; therefore, the increase in the exemption rate, which was supposed to take place as from 2025, will be postponed to January 2026.

As of the date of this report, the Company is unable to assess whether this proposal will be promoted, and if it is, indeed, promoted, its effects if it becomes a binding directive.

4.2.6 Pension contribution caps

In accordance with the provisions of the tax laws, employees for whom their employer makes pension contributions are entitled to various tax benefits at the contribution stage - the employer's contribution in connection with the annuity component is tax exempt up to a contribution of 7.5% of a salary which will not exceed twice and a half the average wage in Israel; the employer's contribution in connection with the severance pay component is tax exempt up to 8.3% of a salary which will not exceed approx. 3.3 times the average wage in Israel.

Amid the discussions in connection with the state budget for 2025-2027, as part of the Draft Government Resolution of September 2024 and the Draft Economic Plan of October 2024, it is suggested to consolidate the said caps placed on employer's contributions for the pension component and the severance pay component, such that they stand at twice the average wage in Israel. (That is to say, a cap which is lower than the existing separate caps for the compensation component and the severance pay component). The meaning of the proposal is an increase in taxation imposed on pension contributions for a salary, which exceeds twice the average wage in Israel.

It was also suggested to amend the definition of average wage in the National Insurance Law, such that the cap regarding tax benefits in respect of employer's contributions for retirement benefits and severance pay will be frozen.

However, the Ministry of Finance's announcement regarding the approval of the proposed state budget by the Government includes a partial list of the steps approved by the Government, and a description of the above amendment is not included.

As of the date of this report, the Company is unable to assess whether this proposal will be promoted, and its effect if it is, indeed, promoted and becomes a binding directive; however, it may affect the amounts of contributions and accruals of the relevant funds in funds under Clal Pension and Provident Funds' management.

4.2.7 Guaranteed return in pension fund

Pension funds are eligible to guaranteed return (by way of purchasing designated bonds or investing in a guaranteed-return track, hereinafter - "Guaranteed-Return Assets"), at a rate of 30% of the total balances accrued in the fund.

As from July 1, 2017, the imputation of the guaranteed return in the comprehensive pension fund is carried out such that for annuity recipients a return at the rate of 60% of total assets of the annuity recipients is imputed in respect of Guaranteed-Return Assets, whereas for planholders, who are not annuity recipients, the return in the fund arising from the balance of investment in Guaranteed-Return Assets is imputed.

In accordance with the existing regulations, as from January 1, 2025 the imputation of return in relation to planholders, who are not annuity recipients, will change such that for planholders aged 50 and over the return on Guaranteed-Return Assets will be imputed at a rate of 30% of total balances accrued in the fund for planholders in this group, whereas for planholders aged 50 and under the return will be imputed from the balance of the fund's investment in Guaranteed-Return Assets, after the distribution to annuity recipients and to planholders aged 50 and over.

Draft Supervision of Financial Services Regulations (Provident Funds) (Imputation of Return in a Comprehensive New Pension Fund) (Amendment), 2024 and Draft Supervision of Financial Services Regulations (Provident Funds) (Transfer of Planholders in Default Tracks to a Track Appropriate for Their Age), 2024 were published in October 2024. As part of the drafts, it is suggested to determine that the above change in the imputation of return in relation to planholders, who are not annuity recipients, will be postponed by one year (starting on January 1, 2026), and in relation to the group of planholders aged 50 and over the return in the pension funds will be guaranteed only to those who save in age-based tracks, which are appropriate for their age and in the fund's general investment track; a planholder will not be allowed to opt for an age-based track, which is not appropriate for their age, and the funds saved by a planholder, who currently invests in an age-based track, which is not appropriate for their age, will be transferred to a track, which is appropriate for their age.

As a general rule, variation in the rate of allocation of guaranteed return between investment tracks with an identical name offered by different entities might cause savers to sign-on or switch to certain pension funds. However, the mechanism set in the regulations caps the difference, which might arise in the rate of allocation of guaranteed return between different entities in a manner which is expected to moderate such preference.

The Company's assessment regarding the Draft Imputation of Return Regulations and the Transfer of Planholders Regulations is forward-looking information, based on information in the Company's possession on the report date. The actual outcomes may be different than expected and depend, among other things, on the final wording of the regulations, if they are, indeed, approved, the development of competitive conditions in the market, the behavior of competing entities and distributing entities, and the selections of planholders and policyholders.

4.3 P&C Insurance

Further to Sections 7.1.1.2(b3) and 7.1.1.2(b4) to the Description of the Corporation's Business chapter in the Company's Periodic Report of 2023, in May 2024, the Commissioner published Insurance Circular 2024-1-7 - Amendment of the Consolidated Circular Title 6 Part 2 - Provisions in the Motor Property Subsegment (hereinafter - "Amendment of the Provisions of the Consolidated Circular regarding the Motor Property Subsegment"); and Insurance Circular 2024-1-6 - Filing of Insurance Plans in the Motor Property Subsegment (hereinafter - the "Filing of Insurance Plans in the Motor Property Subsegment Circular"). These provisions constitute a comprehensive regulation of the motor property claims process; they include various provisions regarding the wording of motor property policies, and the disclosure provided by the insurer to the policyholder in the pre-contractual phase (hereinafter jointly - the "Reform in the Motor Property Subsegment").

The Filing of Insurance Plans in the Motor Property Subsegment Circular stipulates that the insurance company will revise the wording of the disclosure it is required to give policyholders (as determined in a decision in principle of September 19, 2023 regarding the payment of reduced insurance benefits due to a difference in spare parts prices), such that if damage is reduced in a non-authorized auto repair shop, which does not participate in the arrangement, due to reduction of the insurance benefits by the amount of the difference between the cost of the spare parts when the vehicle is repaired in an authorized auto repair shop, compared to the cost in a nonauthorized auto repair shop, the insurance company will meet its obligations to act in good faith and fairly towards the policyholder. As part of the revision of the disclosure rules, it is determined, among other things, that the insurance company will disclose to a policyholder who is insured under the insurance plan, the rules regarding the reduction of the insurance benefits in the event of damage reduction. The reduction rules will be submitted for approval by the Authority as part of an application to approve an insurance plan and set criteria will be taken into account. It was also determined that in a motor property insurance plan, it will be stipulated that if a policyholder, who opted to repair the vehicle other than in an authorized auto repair shop, reported the insured event to the insurance company before repairing the vehicle and took the reasonable measures as advised by the insurance company, and the auto repair shop agreed to accept the terms and conditions of the insurance company's arrangement before repairing the vehicle, the insurance company will deduct a deductible from the insurance benefits as if the policyholder repaired their vehicle in an authorized auto repair shop. The circular also stipulates that the insurance company will not include as part of a motor property insurance plan a compensation for constructive total loss as defined in Section 6(b) to the standard policy - motor property, except in cases approved by the Authority in the insurance plan (hereinafter - the "Provision regarding Constructive Total Loss"). The circular's effective date is September 1, 2024; however, the provisions regarding total constructive loss shall be binding as from the day of coming into force of the amendment to the definition of "total loss" in the Traffic Regulations, 1961, regarding the selection of "total loss" appraiser for the vehicle.

The Amendment of the Provisions of the Consolidated Circular regarding the Motor Property Subsegment stipulates - in connection with auto repair shops - that an insurance company should conduct negotiations with any auto repair shop wishing to serve as an agreed auto repair shop, which provides services to its policyholders or to a third party (hereinafter - "Authorized Auto Repair Shop"), and allow any other auto repair shop with similar characteristics - based on the same service criteria, which were set by the insurance company - to engage with it in an identical agreement. If the auto repair shop does not have characteristics similar to those of an Authorized Auto Repair Shop, the insurance company will not refuse to sign an agreement, but it will be modified as required.

It was further stipulated that an insurance company will not refuse contracting an auto repair shop in an agreement, which defines it as an Authorized Auto Repair Shop, if such refusal is based on criteria listed in the consolidated circular, including one of the following: The auto repair shop's scope of activity; the size of the auto repair shop; the number of employees in the auto repair shop; and the characteristics of the auto repair shop's customers, including the type of vehicles repaired in the auto repair shop; the auto repair shop's being a part of a chain of auto repair shops.

In addition, principles were established which the contract between the insurance company and the authorized auto repair shop should include, as well as minimum terms and conditions for the contract between the insurance company and Authorized Auto Repair Shop, which establish, among other things, that the price of an hour worked shall be in accordance with that which was agreed between the Authorized Auto Repair Shop and the insurance company; the cost of spare parts shall be in accordance with the discount that the Authorized Auto Repair Shop will undertake to give the insurance company, or alternatively - the Authorized Auto Repair Shop will undertake that the price of the spare parts it will supply will not exceed the price of the spare part which was purchased by the insurance company or which may be supplied thereby, or will undertake to use the spare parts that will be supplied by the insurance company, in accordance with the agreement between the insurance company and the auto repair shop or any other commercial term or condition regarding the cost of the repair agreed upon between the parties (hereinafter - the "Alternatives for Charging for Spare Parts Costs"); an Authorized Auto Repair Shop shall only begin repairing the car after obtaining approval from the insurance company and the owner of the car; the insurance company was banned from engaging with the Authorized Auto Repair Shop in an agreement that caps the car repair amount or sets an average car repair cost; the insurance company may cancel the agreement with an Authorized Auto Repair Shop only after the auto repair shop was given the option to remedy the breach, with the exception of exclusions.

Regarding preventing conflict of interest, it was determined that an insurance agent, an auto repair shop or an appraiser will not give or receive any fee or any other benefit, as part of and during the process of selecting an auto repair shop and repairing the car, and regarding insurance agents - including through a claims management company or any other party involved in the process, including in respect of various consulting services.

With regard to appraisers, it was determined, among other things, that if an appraiser is selected out of a pool of appraisers offered by the insurance company, the insurance company will be required to use a pool of appraisers, that will be open to all appraisers, who will meet the criteria set in the draft (hereinafter - the "Appraisers Pool"); the insurance company and an appraiser, who wishes to be included in the Appraisers Pool, will engage in an agreement identical to the agreement between the insurance company and another appraiser included in the Appraisers Pool, who has characteristics similar to those of the first appraiser, including in relation to the formula that will be used to calculate the appraiser's fee. Also includes the Consolidated Circular - provisions regarding the number of appraisers, who will be included in the Appraisers Pool and their distribution; and regarding the procedure that an insurance company is required to follow in order to exclude an appraiser from the Appraisers Pool, in accordance with objective parameters that were included in the engagement agreement.

It was further determined that the fees of the appraiser, who is included in the Appraisers Pool, shall be composed of a fixed component and a variable component, and the variable component will be at a rate which is not negligible and will reflect parameters related to service and parameters that are specific to the appraiser, such as experience and specialization in specific types of vehicles.

Furthermore, it was determined that a comment to an appraiser whereby repairing the car according to the repair quote might affect the car's safety, or a comment whereby there is an identical spare part that can be obtained, shall not constitute a forbidden influence on the appraiser's judgement.

The appraiser will be selected randomly from the pool. The repair quote and the appraisal of an appraiser that is selected from the Appraisers Pool as stated above shall be the deciding repair quote and appraisal, unless the insurance company appealed to a deciding appraiser in accordance with the mechanism set forth in the circular.

An appraisal of a private appraiser, which was selected by a person who suffered damage in a third-party claim, may be a "deciding appraisal" if the third party acted in accordance with the rules set in the Circular, while giving the insurance company the option to appeal the appraisal before a deciding appraiser mechanism. Furthermore, the circular sets provisions for the implementation and operation of a deciding appraiser mechanism.

It was also determined that the insurance company will be required to suggest to policyholders a plan as part of which they will be able to select any auto repair shop (other than an Authorized Auto Repair Shop) without this affecting the deductible that the policyholder will pay. The circular sets various provisions regarding disclosure, transparency and extensive disclosure and documentation provisions, both prior to the policy purchase date and on the date of the claim.

Also provided for were Provisions for the Transitional Period for the purpose of creating the required mechanisms as per the circular.

In July 2024, Israel Garage Association (not for profit entity) filed an administrative petition against the Capital Market, Insurance and Savings Authority and against the Ministry of Transport regarding the Reform in the Motor Property Subsegment (hereinafter - the "Garage Association Petition") as part of which it requested various remedies; among other things, it requested to order the cancelation of the Filing of Insurance Plans in the Motor Property Subsegment Circular and the cancellation of the practice whereby differences in spare parts prices are offset, which was approved as part of an in-principle decision of September 19, 2023; order the cancellation of the provisions of the consolidated circular regarding the Motor Property Subsegment; order the respondents to draw up a new regulation, which will cancel the authorized auto repair shops; set rules as to spare parts prices, and appoint a taskforce, which will monitor spare parts prices.

At this preliminary stage, Clal Insurance is unable to predict all of the effects of the Reform in the Motor Property Subsegment, which may have contradictory effects on the costs for settling claims in motor property insurance in view of the multiple amendments proposed and their cumulative effects, which may be material: The amendments regarding insurers' monitoring of the cost of spare parts may lead to a decrease in spare part costs; giving each auto repair shop the option to serve as an Authorized Auto Repair Shop may reduce insurance companies' monitoring capabilities, including in relation to fraud, detract from economies of scale, and increase the claim settlement costs; the setting up of the appraisers pool mechanism, its functioning and effect on the claims settlement costs depend, among other things, on appraisers' willingness to be included in the pool, on the database of appraisers, their fees, and the number of referrals to a deciding appraiser mechanism; a discount in deductible to policyholders where authorized auto repair shops, will agree to comply with the arrangement regarding spare parts may increase the number of repairs in those auto repair shops, the cost of claim settlement in which is expected to be higher than that of the authorized auto repair shops; in the opinion of Clal Insurance, it is impossible to predict the effect of the cancellation of the constructive total loss mechanism, and of the expected amendment of the definition of total loss in the Traffic Regulations, 1961, and those effects depend, among other things, on the promotion of the Ministry of Transport's regulation of the cost of spare parts.

The information regarding the motor property reform constitutes forward-looking information, based on information in the Company's possession on the report date. Actual results may vary from those predicted, and depend, among other things, on the promotion of the Ministry of Transport's regulation of the cost of spare parts, definition of "market price", and the amendment of the Traffic Regulations regarding "total loss", behavior of suppliers of spare parts, auto repair shops, appraisers, agents, customers and competing entities, results of the petition filed by the Auto Repair Shop Union, and conduct of the relevant regulators, including the Ministry of Transport and the Capital Market, Insurance and Savings Authority.

4.4 Max's Activity

4.4.1 Banking Law (Licensing)

Further to Section 15.1.1 to the Description of the Corporation's Business chapter to the Company's Periodic Report of 2023 regarding draft policies and general conditions for those applying for a holding permit in banking corporations, acquirers and corporations which hold them, in which it was stipulated that the permits that were granted by virtue of the policy applicable on the publication date will expire on December 31, 2029.

In March 2024 the Banking Supervision Department published draft policies and general conditions for those applying for a holding permit in banking corporations, acquirers and corporations which hold them. This paper is published further to previous publications of the Bank of Israel regarding holding and control permits in banking corporations, and stipulates, among other things, principles for issuance of holding permits through the holdings of means of control, including economic resilience and personal and business integrity of those who applied for a permit, and sets forth specific provisions regarding a holding permit applicant, which is private equity fund.

In July 2024, the Banking Supervision Department published policies and general conditions for the provision of holding permits in banking corporations, in prudentially significant providers of payment services, and their holding corporations, for entities managing customers' funds. This document is published further to previous publications of the Bank of Israel regarding holding and control permits in banking corporations, and includes several changes, such as removal of the restriction on the total holdings of the provident funds and the insurers controlled by those requesting the permit; ending the term of the permits on December 31, 2029; adding requirements from the controlling shareholder, such as reporting requirements and the requirement to deliver information.

Regarding holding permits awarded to institutional entities from the Clal Insurance Group to hold banks and credit card companies, and regarding restrictions applicable to Clal Group, see Section 9.5.4.2 to the Company's Description of the Corporation's Business Report for 2023.

4.4.2 Plan for Establishing the Interchange Fee

Further to Section 15.1.5 to the Description of the Corporation's Business chapter to the Company's Periodic Report of 2023 regarding the exemption given to the interchange acquiring arrangement between the credit cards companies of April 2018, and regarding a new request to approve the validity of the exemption - in May 2024, the Israel Competition Authority decided to grant an exemption from approval of a cartel clearance in connection with the interchange acquiring arrangement through December 31, 2028, under conditions which are not materially different from those of the previous exemption. The Israel Competition Authority decided not to regulate - as part of the terms of the new exemption - an approval it previously issued to the Company (as part of a no-action relief, that will expire on the expiry date of the previous exemption) to launch the "Max Self-Employed" service (a payment receipt service offered to small dealers through a platform, which is similar to the payment apps operated by the banks, and which includes control and financial management and allows an exemption from acquiring fee under certain conditions), excluding a preparation period through May 15, 2025 for customers, who joined the service prior to the publication of the new exemption. The Israel Competition Authority noted in the new exemption that it may be possible to assess such ventures in the future - subject to future developments in the acquiring market or the payments market.

4.4.3 Law of Prevention of Economic Damage to the Consumer (Legislative Amendments), 2024

In July 2024, the Law of Prevention of Economic Damage to the Consumer (Legislative Amendments), 2024 was published, whose aim is to give the government officer charged with consumer protection the power to determine that a dealer (or someone who is associated therewith) committed aggravated breach, and to deliver information regarding such a determination to a payment services provider; and legislative amendments, whose purpose is to regulate the obligations of payment services providers, where such notice was issued: Discontinuation of the transfer of funds, which are supposed to be paid to such a beneficiary as from the notice date, and holding such funds until the court issues a decision, or for the purpose of repaying them to the payor at the request of the beneficiary. Furthermore, it was stipulated that an entity providing payment services to a beneficiary will not engage with a beneficiary, in respect of which such a notice was issued or published, for a period of two years from the notice receipt or publication date. At this stage, Max is not yet able to assess the law's effect on its activity.

4.4.4 The Payment Services Memorandum of Law (Amendment) (Consumer Protection against Dealers who Commit Violations under Aggravating Circumstances), 2024

In June 2024, the abovementioned memorandum of law was published, which prescribes supplementary liability arrangements aimed to protect consumers from exploitation, forgery and fraud. As part of the above, it is suggested to expand the liability arrangement currently set in law with regard to circumstances of misuse of means of payment, such that it will also apply to a fishing fraud, in which the person committing the fraud impersonates as the payer's payment services provider, and in circumstances in which they impersonated the beneficiary, even if the payer gave the essential component to the impersonator. In addition, it is suggested to expand the option available to the consumer to ask their payment services provider to suspend the payment to the beneficiary due to "failure to deliver", such that it will also apply to cases where the transaction was entered into by means of exploitation and fraud, provided that conditions set in the law memorandum are met. The suggested change to the liability arrangement may have a material effect on the payments system in Israel.

The information pertaining to the said memorandum of law constitutes forward-looking information, which is based on Max's assessments and assumptions as of the report publication date. Actual implementation may vary materially than expected, and depends, among other things, on the final wording of the law, if and as it is passed.

4.4.5 Amendment of provisions set under the Strum Law

In July 2024, the Banking Law (Licensing) (Amendment No. 31) was published, which amended the provisions of the Banking Law (Licensing), 2024, as set out in the "Strum Law", regarding the control of a bank with a broad scope of activity in a payment card company, such that the ban on the acquisition by an institutional entity - from a bank with a broad scope of activity - of means of control of a payment card company will be cancelled; it also stipulated that a bank with a medium scope of activity (whose assets have a value of between 5%-10% of the value of assets of all banks in Israel) will not be allowed to control a payment card company.

These moves are supplementary moves for the publication of the Banking Regulations (Licensing) (Bank with a Broad Scope of Activity), 2023, which revised the definition of a bank with a broad scope of activity, such that a bank, the total assets under management of which constitute 10%-20% of the value of the assets of all banks in Israel, will be required to sell its holdings in a payment card company under its ownership.

The said provisions regarding structural separation between banks and payment cards companies, as well as other provisions that may be published in the future in connection with those aspects may lead to structural changes in the relevant markets.

The information pertaining to the provisions of said law constitutes forward-looking information, which is based on Max's assessments and assumptions as of the report publication date. The actual implementation may be materially different than that predicted and depends, among other things, and the manner of their implementation, the resolutions that will be made in the future regarding the concentration of institutional entities and structural separation, if any, and the behavior of competitors.

4.4.6 Open Banking

In April 2024, the Banking Supervision Department published a revision to Proper Conduct of Banking Business Directive No. 368 regarding the Implementation of an Open Banking Standard in Israel. The revision mainly deals with the implementation of the adjustments required to support - through technological means - access to financial data by customers, which are corporations, as part of open banking.

4.4.7 Iron Swords War

Further to Section 15.1.20 to the Description of the Corporation's Business chapter to the Company's Periodic Report of 2023 regarding various provisions published by the Banking Supervision Department and the Bank of Israel following the Iron Swords War -

On March 31, 2024, the Banking Supervision Department published adjustments to the provisions of Proper Conduct of Banking Business Directives for dealing with the Iron Swords War (Temporary Order), which cancelled most of the expedients granted under the Temporary Order of February 2024, which prescribed expedients regarding the implementation of Proper Conduct of Banking Business Directives 367 and 420 and regarding identification requirements in the context of prohibition on money laundering and financing of terrorism.
The support outline aimed at assisting the customers of credit card companies to deal with the effects of the Iron Swords War, which was published by the Banking Supervision Department in October 2023 and which was adopted by the credit card companies, was extended a number times, with various changes, the latest of which was approved at the end of March 2024.

4.4.8 Risk management

In June 2024, the Banking Supervision Department published a draft of a new Proper Conduct of Banking Business Directive regarding Model Risk Management and a draft Q&A file for its implementation. The directive is intended to supersede the Banking Supervision Department's letter regarding this topic, with the aim of creating a model risk management framework as is the case in the management of other risks, including the Board of Directors and management's responsibility to the monitoring, control and risk management aspects.

4.4.9 Assessing measures to increase competition in banking services offered to the retail sector in Israel

As part of the Draft Economic Plan for 2025, which was published in October 2024, it is recommended to set up a public committee, which will recommend the best outline to allow additional financial entities to raise funds from the public and offer credit to the retail sector from those deposits. It is further suggested that the committee will recommend measures to increase competition in banking services offered to the retail sector (including households and SMEs), including the introduction of additional financial and nonfinancial market players, which will be able to receive deposits from the public and - at the same time give credit to the retail sector. Accordingly, a public committee was set up to assess such an outline.

4.4.10 Announcement of a payment cards scheme

In July 2024, the Governor of the Bank of Israel announced the "Payment Cards Scheme" operated by Automated Banking Services (ABS), as a controlled system in accordance with the Payment Systems Law, 2008. The Payment Cards Scheme constitutes a set of rules between issuers and acquirers in Israel regarding their activity in the field of payment cards. According to the Bank of Israel, this announcement is part of the steps it promotes to ensure the efficiency and stability of the Israeli financial market's infrastructures, and - among other things - it will encourage the entry of new players into this market.

4.4.11Management of Information Technology Risks, Information Security and Cyber Security

In November 2024, the Banking Supervision Department published a new Proper Conduct of Banking Business Directive concerning Management of Information Technology Risks, Information Security and Cyber Security. According to the directive's explanatory notes, it aims to modify the current regulatory framework for technology risks management, such that it addresses the ever-changing technological environment and threats and is in line with globally accepted regulation; the directive also aims to achieve appropriate and effective management of information technology, while minimizing the number of incidents in which a technology risk materializes and the confidentiality, integrity or availability of information assets is adversely affected. It is also noted that the directive will serve in the future as the basis for the Banking Supervision Department's directives regarding specific information technology aspects, to the extent that such directives will be published. The Directive's effective date is 18 months from its publication date. Upon its coming into effect, Proper Conduct of Banking Business Directives 357, 361 and 363, and several circulars that preceded it, and which focus on topics regulated in the new directive, will be cancelled. The Company is studying the directive and will make preparations for its implementation.

4.4.12 Revision to Banking Principles (Customer Service) (Fees and Commissions), 2024

The Revision to Banking Principles (Customer Service) (Fees and Commissions), 2024 was published in the Official Gazette in November 2024. As part of the revision, a new chapter was added to the Bank of Israel's price list regarding payment apps, whose objective is to list the terms and conditions and restrictions regarding collection of fees from customers who use those apps, in view of the costs associated with the provision of those services. A fee may be collected only for users, who receive or transfer payments at a total annual amount of more than NIS 25,000 (a banking corporation which will wish to revise the annual activity threshold may do so only after two years from the date on which those services are added to the list of fees which may be collected; such revision will require the approval of the Banking Supervision Department). Furthermore, it will be allowed to collect a fee for special services, which will be rendered to payment apps' customers, who will wish to be rendered such services (in addition to payment transfer and receipt services), subject to approval of the Banking Supervision Department. According to publications on behalf of the apps, in view of the fact that not many customers exceed the threshold, this move will only slightly change the nature of the existing activity. In addition, the move may increase the competition in the acquiring market.

The above information is forward-looking information, which is based on publicly-available publications; actual effects may be materially different than those described above, in accordance with the implementation by the payment apps, the actual conduct of the customers, and the development of the competition in the market.

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.

In February 2024, CIMax repaid the full balance of its syndicated loan, totaling an amount of approx. NIS 891 million. This loan has borne variable interest; therefore, after its repayment there were no material changes in the Company's exposure to market risks and their management during the Reporting Period compared to the Annual Financial Statements.

	NIS		Foreign currency			Other non	Credit card	Israeli
In NIS million	Non CPI			GBP		monetary	company in	insurance
	linked	linked USD	EUR		Other	items	Israel	company	Total
Intangible assets	‐	‐	‐	‐	‐	‐	909	247 1,065	2,221
Deferred tax assets	‐	‐	‐	‐	‐	‐	10	141	4 154
Deferred acquisition costs	‐	‐	‐	‐	‐	‐	5	‐ 2,597	2,602
Property, plant & equipment	‐	‐	‐	‐	‐	‐	18	139	164 320
Right-of-use asset	‐	‐	‐	‐	‐	‐	91	198	392 681
Investments in associates	‐	‐	‐	‐	‐	‐	128	‐	62 190
Investment property in respect of yield-dependent contracts	‐	‐	‐	‐	‐	‐	‐	‐ 3,892	3,892
Investment property - other	‐	‐	‐	‐	‐	‐	‐	‐ 1,521	1,521
Reinsurance assets	‐	‐	‐	‐	‐	‐	‐	‐ 3,929	3,929
Current tax assets	‐	7	‐	‐	‐	‐	‐	28	89 125
Receivables for credit card transactions, net	‐	‐	‐	‐	‐	‐	‐ 17,352		‐ 17,352
Receivables and debit balances	52	22	-	‐	‐	‐	1	41 1,273	1,389
Collectible premiums	4	‐	‐	‐	‐	‐	‐	‐ 1,002	1,006
Financial investments in respect of yield-dependent contracts	‐	‐	‐	‐	‐	‐	‐	‐ 86,542	86,542
Other financial investments
Liquid debt assets	9	‐	12	‐	‐	‐	‐	‐ 6,061	6,082
Illiquid debt assets	‐	-	‐	‐	‐	‐	‐	‐ 25,605	25,606
Shares	‐	‐	‐	‐	‐	‐	27	‐ 1,755	1,783
Other	99	‐	‐	‐	‐	‐	-	1 6,124	6,224
Cash and cash equivalents in respect of yield-dependent contracts	‐	‐	‐	‐	‐	‐	‐	‐ 5,011	5,011
Other cash and cash equivalents	56	‐	1	-	‐	‐	‐	591 1,366	2,014
Total assets	220	29	13	-	‐	‐ 1,190	18,738	148,455	168,645

Linkage base report as of September 30, 2024

Linkage bases report as of September 30, 2024 (cont.)

	NIS		Foreign currency			Other non		Credit card	Israeli
In NIS million	Non linked	CPI linked	USD	EUR	GBP	Other	monetary items		company in Israel	insurance company	Total
Liabilities
Liabilities in respect of insurance contracts and non-yield dependent investment contracts		‐	‐	‐	‐	‐	‐	‐		‐ 35,175		35,175
Liabilities in respect of insurance contracts and yield-dependent investment contracts		‐	‐	‐	‐	‐	‐	‐		‐ 94,556		94,556
Deferred tax liability		‐	‐	‐	‐	‐	‐	11		‐	718	729
Liabilities for employee benefits, net		22	‐	‐	‐	‐	‐	‐	24		44	91
Lease liabilities		‐	109	‐	‐	‐	‐	‐	198		481	788
Payables for credit card transactions		‐	‐	‐	‐	‐	‐	‐	9,616		‐	9,616
Payables and credit balances	129		‐	‐	‐	‐	‐	3	583	3,149		3,864
Current tax liabilities		‐	‐	‐	‐	‐	‐	‐		7	3	10
Financial liabilities	1,533		‐	‐	‐	‐	‐	‐	6,404	6,625		14,561
Total liabilities	1,684		109	‐	‐	‐	‐	14	16,832	140,752		159,391
Total exposure	(1,465)		(80)	13	-	‐	‐	1,176	1,906	7,703		9,254

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 2023 Financial Statements (pp. 71-90).

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, 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.

For further 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 in respect of 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 acquisitions using credit cards.
Interest-bearing credit loans, revolving credit, loans to finance vehicles and credit transactions involving the spreading of payments. Credit is mainly provided at variable interest and for different periods in accordance with the product.

Most of the portfolio is composed of own credit without collaterals, except for loans for the financing of vehicles, in which the vehicles serve as collaterals.

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, which 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, which constitute another method for assessing the risk level.

The models are based on internal and external information sources that might 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, which 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, which 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.

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.

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 restrictions on and monitoring of the corporation's business, internal rules, 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, and more.

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, which 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 that are 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.

In the first quarter of 2023, Max started advancing loans as part of a new fund for state-backed loans, which offers loans to all companies.

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. A large portion of the credit advanced to merchants is aimed at merchants for which Max serves as an acquirer. The acquiring does not serve as a collateral against credit advanced to the merchants; however, it does serve as a source for debt settlement. Alongside with its activities with customers that use its acquisition services, Max also advances credit to customers, which are not involved in its acquisition 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.

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.

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

	September 30, 2024				September 30, 2023				December 31, 2023
	Com	Private				Private				Private
	mercial	indivi	Others	Total	Com	indivi		Total	Com	indivi		Total
		duals			mercial	duals	Others		mercial	duals	Others
In NIS million			Unaudited				Unaudited				Unaudited
Credit risk with credit performance rating (1)
On-balance-sheet
credit risk	1,333	13,564	2,375	17,272	1,182	12,249	2,307	15,737	1,121	11,713	2,193	15,028
Off-balance-sheet
credit risk	682	24,149	13,461	38,292	510	19,461	12,028	31,999	544	20,974	13,094	34,612
Total credit risk in credit performance
rating	2,015	37,713	15,836	55,564	1,692	31,710	14,336	47,737	1,665	32,687	15,287	49,640
Credit risk not in credit performance rating:
Non-troubled	12	424		‐ 436	11	351		‐ 362	13	363		‐ 376
Troubled
performing	33	351		‐ 384	15	356		‐ 371	40	341		‐ 381
Troubled non
performing	30	161		‐ 191	23	145		‐ 168	27	148		‐ 175
Total on-balance
sheet credit risk	75	936		‐ 1,011	49	852		‐ 901	80	852		‐ 932
Off-balance-sheet
credit risk		2 29		31 ‐		2 29		‐ 31		2 30		‐ 32
Total credit risk not in credit
performance rating	77	965		‐ 1,042	51	881		‐ 932	82	882		‐ 964
Of which: Performing debts, in arrears of 90 days or more		‐	‐	‐	‐	‐	‐	‐	‐	‐	‐	‐ ‐
Overall credit risk
incl. of the public	2,092	38,678	15,836	56,606	1,743	32,591	14,336	48,669	1,747	33,569	15,287	50,604
Additional information on total non-performing assets:
Non-performing
debts	30	161		‐ 191	23	145		‐ 168	27	148		‐ 175
Total non performing assets	30	161		‐ 191	23	145		‐ 168	27	148		‐ 175

(1) Credit risk whose credit rating at the reporting date matches the credit ratings for granting new credit in accordance with Max's policy. Note: Credit risk is stated before the effect of credit loss provision and the effect of collateral that is deductible for the purpose of indebtedness of a borrower or group of borrowers.

	For the three-month period ended September 30
	2024				2023
	Com mercial	Private indivi duals	Total	Com mercial	Private indivi duals	Total
In NIS million	(Unaudited)
Outstanding balance of non-performing debts as of the beginning of period	27		155	182	17 124	141
Loans classified as non-performing during the period	10		108	118	12 103	115
Non-performing debts written-off from the books of accounts	(3)	(55)		(58)	(3) (45)	(48)
Repaid non-performing debts	(4)	(47)		(51)	(3) (37)	(40)
Balance of non-performing as of end of the period	30		161	191	23 145	168

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

Changes in non-performing debts in respect of receivables for credit card transactions**

			For the nine-month period ended September 30					For the year ended December 31
		2024			2023			2023
	Com mercial	Private indivi duals	Total	Com mercial	Private indivi duals	Total	Com mercial	Private indivi duals	Total
In NIS million			(Unaudited)					Audited
Outstanding balance of non performing debts as of the beginning of period	27	148	175		9	105 114	9	105	114
Loans classified as non performing during the period	30	310	340	24		183 207	35	285	320
Non-performing debts written off from the books of accounts	(14)	(172)	(186)	(6)	(84)	(90)	(11)	(139)	(150)
Repaid non-performing debts	(13)	(125)	(138)	(4)	(59)	(63)	(6)	(103)	(109)
Balance of non-performing as of end of the period	30	161	191	23		145 168	27	148	175

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

		As of September 30, 2024
	Commercial	Private individuals	Total
		%
Credit quality analysis
Rate of non-accruing receivable balance of receivables for credit card transactions	2.12	1.11	1.20
Rate of non-accruing or 90 days or more in arrears receivable balance of receivables for credit card transactions	2.12	1.11	1.20
Rate of troubled credit out of receivables for credit card transactions	4.45	3.52	3.60
Rate of credit not in credit performance rating of the balance of receivables for credit card transactions	5.30	6.43	6.33
Analysis of credit loss expenses for the reporting period
Rate of expenses in respect of credit losses out of the average balance of receivables for credit card transactions	1.51	1.41	1.42
Rate of net write-offs of the average balance of receivables for credit card transactions	1.21	1.48	1.46
Analysis of credit loss provision
Rate of balance of credit loss provision of the balance of receivables for credit card transactions	4.66	2.07	2.30
Rate of balance of provision for credit losses of the balance of non performing receivables for credit card transactions	220.00	186.96	192.15
Rate of the balance of provision for credit losses of the balance of non accruing or 90 days or more in arrears receivables balance for credit card transactions	220.00	186.96	192.15
Rate of net write-offs of the balance of provision for credit losses for receivables for credit card transactions	24.24	66.89	59.22

	As of September 30, 2023
	Commercial	Private individuals	Total
		%
Credit quality analysis
Rate of non-accruing receivable balance of receivables for credit card transactions	1.82	1.10	1.16
Rate of non-accruing or 90 days or more in arrears receivable balance of receivables for credit card transactions	1.82	1.10	1.16
Rate of troubled credit out of receivables for credit card transactions	3.00	3.79	3.72
Rate of credit not in credit performance rating of the balance of receivables for credit card transactions	3.87	6.44	6.22
Analysis of credit loss expenses for the reporting period
Rate of expenses in respect of credit losses out of the average balance of receivables for credit card transactions	3.47	1.65	1.80
Rate of net write-offs of the average balance of receivables for credit card transactions	0.69	1.00	0.97
Analysis of credit loss provision
Rate of balance of credit loss provision of the balance of receivables for credit card transactions	4.58	2.33	2.53
Rate of balance of provision for credit losses of the balance of non performing receivables for credit card transactions	252.17	212.41	217.86
Rate of the balance of provision for credit losses of the balance of non accruing or 90 days or more in arrears receivables balance for credit card transactions	252.17	212.41	217.86
Rate of net write-offs of the balance of provision for credit losses for receivables for credit card transactions	13.79	41.56	37.16

	As of December 31, 2023
	Commercial	Private individuals	Total
		%
Credit quality analysis
Rate of non-accruing receivable balance of receivables for credit card transactions	2.19	1.17	1.26
Rate of non-accruing or 90 days or more in arrears receivable balance of receivables for credit card transactions	2.19	1.17	1.26
Rate of troubled credit out of receivables for credit card transactions	5.43	3.86	4.00
Rate of credit not in credit performance rating of the balance of receivables for credit card transactions	6.49	6.72	6.70
Analysis of credit loss expenses for the reporting period
Rate of expenses in respect of credit losses out of the average balance of receivables for credit card transactions	3.42	1.61	1.76
Rate of net write-offs of the average balance of receivables for credit card transactions	0.94	1.14	1.13
Analysis of credit loss provision
Rate of balance of credit loss provision of the balance of receivables for credit card transactions	5.11	2.41	2.65
Rate of balance of provision for credit losses of the balance of non performing receivables for credit card transactions	233.33	206.76	210.86
Rate of the balance of provision for credit losses of the balance of non accruing or 90 days or more in arrears receivables balance for credit card transactions	233.33	206.76	210.86
Rate of net write-offs of the balance of provision for credit losses for receivables for credit card transactions	17.46	47.71	42.55

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 2024, there was no material change in Max's exposure to foreign financial institutions.

For details about 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 No. 339 regarding the management of market risks defines the market risk as the risk of a loss in on- and off-balance-sheet positions deriving from a change in the fair value of a financial instrument due to a change in market conditions (changes in price levels in different markets, interest rates, exchange rate, inflation, share and commodities prices).

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. Max also monitors all financial risks, exposure amounts, results of sensitivity analyses, and material current and expected changes that take place on a current basis and discussed as part of the forum for the management of financial risks, which is headed by the CEO and convenes every month.

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 income (including changes in non-interest income/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 might expose the income and the economic value to unexpected fluctuations due to changes in the interest rates.

Changes in interest rates might 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 which include, among other things, bonds (with fixed interest).
Fair value exposure Max's assets include balances that do not bear interest. When interest rates are changed, an exposure might 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 income. 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 and accounting hedges only.

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

Fair value of the financial instruments of Max and its consolidated companies, except for non-monetary items:

	As of September 30, 2024
	NIS		Foreign currency *
In NIS million	Non-linked	CPI-linked USD	Other		Total
On-balance sheet balance, net	1,191	206	47	69	1,513
Financial assets	16,539	1,074	125	79	17,817
Financial liabilities	15,373	865	78	10	16,326
Net fair value of financial instruments	1,166	209	47	69	1,491

In NIS million	As of September 30, 2023
	NIS		Foreign currency *
	Non-linked	CPI-linked	USD	Other	Total
On-balance sheet balance, net		-	-	-	-	-
Financial assets	16,050		61	97	61	16,269
Financial liabilities	14,693		63	90	15	14,861
Net fair value of financial instruments	1,357		(2)	7	46	1,408

	As of December 31, 2023
		NIS		Foreign currency *
In NIS million	Non-linked	CPI-linked	USD	Other	Total
On-balance sheet balance, net		-	-	-	-	-
Financial assets	15,382	92		64	25	15,563
Financial liabilities	14,010	45		61	9	14,125
Net fair value of financial instruments	1,372	47		3	16	1,438

* 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: Fair value of Max's financial instruments excluding non-monetary items:

	As of September 30, 2024
	NIS		Foreign currency **
In NIS million	Non-linked	CPI-linked	USD	Other	Total
Simultaneous changes
Simultaneous increase of 1%		8	(8)	*	*	‐
Simultaneous decrease of 1%	(8)		8	*	*	‐
Non-simultaneous changes
Steepening		4	*	*	*	4
Flattening	(4)		(2)	*	*	(6)
Short-term interest rate increase	(4)		(5)	*	*	(9)
Short-term interest rate decrease		4	5	*	*	9

In NIS million	As of September 30, 2023
	NIS	Foreign currency **
	Non-linked CPI-linked	USD	Other	Total
Simultaneous changes
Simultaneous increase of 1%	(1)	*	*	*	(1)
Simultaneous decrease of 1%	1	*	*	*	1
Non-simultaneous changes
Steepening	3	*	*	*	3
Flattening	(4)	*	*	*	(4)
Short-term interest rate increase	(7)	*	*	*	(7)
Short-term interest rate decrease	7	*	*	*	7

	As of December 31, 2023
	NIS		Foreign currency **
In NIS million	Non-linked	CPI-linked USD	Other	Total
Simultaneous changes
Simultaneous increase of 1%	8	(1)	*	*	7
Simultaneous decrease of 1%	(8)	1	*	*	(7)
Non-simultaneous changes
Steepening	4	*	*	*	4
Flattening	(4)	*	*	*	(4)
Short-term interest rate increase	(3)	(1)	*	*	(4)
Short-term interest rate decrease	3	1	*	*	4

* Including foreign-currency linked NIS.

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

		As of September 30, 2024
In NIS million	Interest income	Total
Simultaneous changes
Simultaneous increase of 1%	28	28
Simultaneous decrease of 1%	(28)	(28)
	As of September 30, 2023
In NIS million	Interest income	Total
Simultaneous changes
Simultaneous increase of 1%	43	43
Simultaneous decrease of 1%	(43)	(43)

		As of December 31, 2023
In NIS million	Interest income	Total
Simultaneous changes
Simultaneous increase of 1%	44	44
Simultaneous decrease of 1%	(44)	(44)

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 exchange rates arises from its activities, which is to say, acquiring and issuance, in which an international organization is involved (Visa or Mastercard). Since Max has business activities that are linked to foreign currencies, changes in 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 management

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's exposure to the risk as a result of CPI-linked activities is immaterial and arises mainly from interest-bearing credit.

Max defined a maximum exposure limit to the CPI after hedging actions. The hedging of the exposure in accordance with Max's policy through, among other things, 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, which is to say, 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 might arise due to pressures in financial markets.

As part of the management of its current assets and liabilities, Max uses diverse funding sources, in order to diversify the risk. Max's funding sources include its shareholders' equity, secured credit facilities with a number of banks, and debt raising 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 single-payment 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 July 2023, the rating agency Midroog Ltd. assigned a A1.il(hyb) rating for Subordinated Notes (Series D) raised by Max.

In October 2023, the rating agency Midroog Ltd. reiterated Max's rating of Aa3.il, and the rating's stable outlook.

In January 2024, the rating agency Midroog Ltd. assigned a P-1.il rating for Commercial Security (Series 2) raised by Max.

For further details regarding liquidity and financial risk, see the Financing chapter in Max's Report of the Board of Directors for 2022 and Disclosure of Additional Information about Risks, which have been posted on Max's website.

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.
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 might 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 the use of various technologies and IT systems.

For further details about 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 event, taking into account its probability and its severity of its impact. A cyber event 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 the Company), and such attack may result in the materialization of the cyber risk.

It is 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 relies - 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.

The transition to a hybrid work environment that combines remote working with on-site working, triggered a change in Max's exposure to cyber risks. When the Covid-19 crisis started, Max took action to adapt 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.

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.

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 risks officer, whose job is to mitigate the company'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 the Company by its legal department in collaboration with the external attorneys Max works with.

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 in relation 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 subsegment, 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.

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

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 Max is based on continuously assessing its strategy, including, among other things, the following activities:

Formulating a long-term strategic plan, which includes a review and assessment of various events in the work environment (regulation, competition, technology, and more), and assessment of the anticipated changes in relation 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 Max on a regular basis; it also raises topics which are relevant to the strategic risk where necessary.

Reputational risk

Reputational risk is the potential that negative publications, market rumors, or the public perception 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 income. 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 entail 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 in Max is composed, first and foremost, of a process for identifying reputational exposures (any action that might be associated with the brand and lead to negative media coverage or discourse). Monitoring and response are carried out continuously. The management of the reputational risk is regulated as part of a dedicated policy.

Macroeconomic risk

Macroeconomic risk is the risk that Max's income and capital 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, which 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 might affect the credit risk. Max monitors and mitigates this risk continuously, and at this stage there is no material increase in the materialization of the potential risk. Max is preparing for the possibility that the macroeconomic risk will increase, partly on the back of the geopolitical uncertainty, including the Iron Swords War and the effect of the downgrade of the rating of the State of Israel.

Max assesses its ability to withstand negative developments in the macroeconomic environment through systemic stress scenarios. Furthermore, Max continuously monitors various risk indicators, including macroeconomic indicators, and material changes in those indicators are discussed in the forum for the management of financial risks, which is headed by its CEO, in its top risk management committee, and the 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 to 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 a basis for this activity, Max's management decided to implement the international standard regarding environmental management systems.

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, and to invest the required resources.

The Banking Supervision Department's directives on principles for effective management of climate-related financial risks were published in June 2023 and the Company monitors developments in the regulation and the relevant requirements and works accordingly to implement the guidance.

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. The Company opted to publish the report in view of the great importance it places on sharing with Company's customers, employees and other stakeholders its actions in the above areas, rather than due to any regulatory requirement. The full report is posted on the Company's website.

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 decisionmaking 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.

In response to growing local and global uncertainty, Max is boosting the processes for model risk management, including the extent and frequency of monitoring, to mitigate and minimize model risks.

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

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 8 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 periodic 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 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 of Clal Insurance, 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 September 30, 2024, 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.

Officers' Statements on the Effectiveness of Internal Control over Financial Reporting and Disclosure, in relation to the relevant processes, in accordance with the Banking 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 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. Assessment 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 third quarter ended September 30, 2024, 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

Yoram Naveh CEO

Chairman of the Board

Tel Aviv, November 28, 2024

Clal Insurance Enterprises Holdings Ltd.

Condensed Consolidated Interim Financial Statements Financial as of September 30, 2024 (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	2-6
Consolidated Interim Statements of Changes in Equity	2-7
Consolidated Interim Statements of Cash Flow	2-12
Notes to the Consolidated Interim Financial Statements
Note 1 - General	2-16
Note 2 - Basis of preparation of the interim financial statements	2-17
Note 3 - Significant accounting policies	2-19
Note 4 - Segment reporting	2-23
Note 5 - Subsidiaries	2-43
Note 6 - Financial instruments	2-45
Note 7 - Capital management and requirements	2-57
Note 8 - Contingent liabilities and claims	2-63
Note 9 - Credit risk , receivables for credit card transactions and credit loss provision	2-107
Note 10 - Payables for credit card transactions	2-123
Note 11 - Income from credit card transactions	2-123
Note 12 - Additional events in and subsequent to the reporting period	2-124
Note 13 - 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	2-131
Appendices to the Consolidated Interim Financial Statements
Appendix 1 - Breakdown of assets for yield-dependent contracts and other financial investments of the consolidated insurance companies registered in Israel	2-137
Appendix 2 - Interest income and expense rates and analysis of the changes in Max's interest income and expenses	2-141

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 September 30, 2024 and the condensed consolidated statements of income, comprehensive income, changes in equity and cash flows for the nine- and three-month periods then ended. The Board of Directors and management are responsible for the preparation and presentation of financial information for these interim periods 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 an equity-accounted investees, the investment in which amounted to approx. NIS 91 million as of September 30, 2024, and the Group's share in the profits of which amounted to approx. NIS 9 and approx. 4 million for the nine- and three-month periods then ended, respectively. 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 8 to the consolidated interim financial statements regarding exposure to contingent liabilities.

Tel Aviv, November 28, 2024

Somekh Chaikin Certified Public Accountants Kost Forer Gabbay & Kasierer Certified Public Accountants Joint Independent Auditors

A member firm of Ernst & Young Global Limited KPMG Somekh Chaikin is a partnership registered in Israel and a member firm of the KPMG global network of independent firms affiliated with KPMG International Limited, a limited liability English company

	As of September 30		As of December 31
	2024	2023	2023
In NIS million Note	Unaudited		Audited
Assets
Intangible assets	2,221	(*2,196	2,205
Deferred tax assets	154	132	104
Deferred acquisition costs	2,602	2,565	2,543
Property, plant & equipment	320	(*306	302
Right-of-use assets	681	679	680
Investments in equity-accounted investees	190	193	180
Investment property in respect of yield-dependent contracts	3,892	3,842	3,839
Investment property - other	1,521	1,501	1,494
Reinsurance assets	3,929	4,542	3,805
Current tax assets	125	387	306
Receivables for credit card transactions, net 9	17,352	15,650	15,092
Receivables and debit balances	1,389	3,295	1,867
Collectible premium	1,006	976	837
Financial investments in respect of yield-dependent contracts 6	86,542	82,866	84,133
Other financial investments: 6
Liquid debt assets	6,082	6,487	7,313
Illiquid debt assets	25,606	24,425	24,444
Shares	1,783	1,709	1,671
Other	6,224	5,202	5,836
Total other financial investments	39,695	37,823	39,265
Cash and cash equivalents in respect of yield-dependent contracts	5,011	4,552	4,418
Other cash and cash equivalents	2,014	3,052	2,548
Total assets	168,645	164,555	163,617
Total assets for yield-dependent contracts 6	96,838	94,139	94,012

Consolidated Interim Statements of Financial Position

*) Reclassified.

		As of September 30		As of December 31

		2024	2023	2023
In NIS million	Note	Unaudited		Audited
Equity
Share capital		167	167	167
Share premium		2,397	2,390	2,390
Capital reserves		1,213	1,084	1,005
Retained earnings		5,403	4,833	5,019
Total equity attributable to the Company's shareholders		9,180	8,474	8,581
Non-controlling interests		73	66	71
Total equity		9,254	8,540	8,652
Liabilities
Liabilities in respect of insurance contracts and non-yield-dependent
investment contracts		35,175	34,849	34,176
Liabilities in respect of insurance contracts and yield-dependent
investment contracts		94,556	90,897	91,665
Deferred tax liabilities		729	644	592
Liability for employee benefits, net		91	95	93
Lease liabilities		788	775	777
Payables for credit card transactions	10	9,616	8,552	8,091
Payables and credit balances		3,864	3,764	3,851
Current tax liability		10	58	21
Financial liabilities	6	14,561	16,382	15,699
Total liabilities		159,391	156,015	154,966
Total equity and liabilities		168,645	164,555	163,617

Consolidated Interim Statements of Financial Position (cont.)

November 28, 2024
-------------------	--	--

Approval date of the Haim Samet financial statements Chairman of the Board of Directors		Yoram Naveh	Eran Czerninski
		CEO	Executive VP,
		Head of Finance Division

Consolidated Interim Statements of Profit and Loss

	For the nine-month period ended September 30		For the three month period ended September 30		For the year ended December 31
	2024	(*2023	2024	(*2023	(*2023
In NIS million		Unaudited			Audited
Premiums earned, gross	8,038	8,533	2,717	2,826	11,202
Premiums earned by reinsurers	1,366	1,288	461	434	1,708
Premiums earned - retention	6,671	7,244	2,256	2,391	9,495
Income from credit card transactions	1,151	760	416	393	1,083
Investment income, net and finance income	10,792	6,049	4,926	981	9,238
Income from management fees	966	940	325	317	1,259
Income from fees and commissions	326	281	113	98	390
Other income	‐	3	1	1	‐
Total revenues	19,906	15,277	8,036	4,180	21,464
Payments and change in liabilities in respect of insurance
contracts and investment contracts, gross	15,452	11,653	6,572	2,630	16,062
Reinsurers' share in payments and in changes in liabilities in
respect of insurance contracts	(829)	(589)	(372)	(184)	(671)
Payments and change in liabilities in respect of insurance
contracts and investment contracts - retention	14,623	11,064	6,200	2,446	15,391
Credit loss expenses	159	(**353	62	86	(**411
Credit card processing	718	496	258	238	739
Payments to banks	173	115	61	59	166
Fees and commissions, marketing expenses and other
purchase expenses	2,160	1,943	752	706	2,613
General and administrative expenses	834	763	293	252	1,092
Impairment of intangible assets	‐	‐	‐	‐	5
Other expenses	34	25	13	11	40
Finance expenses	633	481	216	212	669
Total expenses	19,334	15,241	7,854	4,010	21,125
Share in results of equity-accounted investees, net	11	8	8	3	8
Income before income tax	583	44	189	173	347
Taxes on income	196	3	60	53	124
Income for the period	387	41	130	120	223
Attributable to:
Company's shareholders	382	39	128	121	220
Non-controlling interests	5	2	2	(1)	3
Income for the period	387	41	130	120	223
Earnings per share attributable to the
Company's shareholders: Basic earnings per share (in NIS)	4.83	0.50	1.62	1.53	2.83
Diluted earnings per share (in NIS)	4.83	0.49	1.61	1.53	2.79
No. of shares used to calculate earnings
per share (in thousand):
Basic	79,062	77,478	79,076	79,031	77,870
Diluted	79,176	79,036	79,138	79,038	79,034

*) CIMax Group was consolidated for the first time as of March 31, 2023, such that its results were included as of that date. For further details, see Note 9 to the Financial Statements for 2023.

**) Total expense includes a provision for credit default following Max's acquisition, see Note 3(i)(1)(d).

	For the nine month period ended		For the three
				month period	For the
				ended	year ended
	September 30		September 30		December 31
	2024	2023	2024	2023	2023
In NIS million		Unaudited			Audited
Income for the period	387	41	130	120	223
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	4	13	‐	4	7
Net change in fair value of financial assets classified as
available for sale carried to capital reserve	402	487	275	80	398
Net change in fair value of available for sale financial
assets carried to the profit and loss statement Impairment loss of available-for-sale financial assets	(116)	(300)	(72)	(63)	(336)
carried to the profit and loss statement	40	47	17	23	60
Other comprehensive income for the period carried or to
be carried to profit and loss, before tax	330	247	221	44	128
Tax in respect of available-for-sale financial assets	121	80	77	14	41
Tax for other components	1	3	‐	1	2
Tax in respect of items of other comprehensive income
carried or to be carried to profit and loss	122	83	77	15	43
Other comprehensive income items that, subsequent to
initial recognition in comprehensive income, were or will
be carried to profit and loss, net of tax	208	164	144	29	86
Items of other comprehensive income not transferred to profit and loss:
Actuarial gains from a defined benefit plan	2	‐	‐	‐	‐
Other comprehensive income for the period, before tax	2	‐	‐	‐	‐
Tax for items of other comprehensive income not
transferred to profit and loss	1	‐	‐	‐	‐
Other comprehensive income not transferred to profit and
loss, net of tax	1	‐	‐	‐	‐
Other comprehensive income for the period	209	164	144	29	86
Total comprehensive income for the period	596	205	274	150	309
Attributable to:
Company's shareholders	591	203	271	151	305
Non-controlling interests	5	2	3	(1)	4
Total comprehensive income for the period	596	205	274	150	309

Consolidated Interim Statements of Comprehensive Income

Attributable to Company's shareholders
	Share	Share		Translation	Capital reserve in respect of available for-sale	Other capital	Capital reserve from transactions with non controlling	Retained		Non-con trolling	Total
In NIS million	capital	premium		reserve	assets	reserves	interests	earnings	Total	interests	equity
For the nine-month period ended September 30, 2024 (unaudited)
Balance as of January 1, 2024 (audited)	167	2,390		(2)	866	180	(39)	5,019	8,581	71	8,652
Income for the period		‐	‐	‐		‐ ‐		‐ 382	382	5	387
Other comprehensive income (loss) items:
Foreign currency translation differences in respect of foreign operations carried to capital reserve		‐	‐	4		‐ ‐		‐ ‐	4	‐	4
Net change in fair value of financial assets classified as available for sale carried to capital reserve		‐	‐	‐	402	‐		‐ ‐	402	‐	402
Net change in fair value of available for sale financial assets carried to the profit and loss statement		‐	‐	‐	(116)	‐		‐ ‐	(116)	‐	(116)
Impairment loss of available-for-sale financial assets carried to the profit and loss statement		‐	‐	‐	40	‐		‐ ‐	40	‐	40
Actuarial gains from a defined benefit plan		‐	‐	‐		‐ ‐		‐ 2	2	‐	2
Tax benefit for items of comprehensive income		‐	‐	(1)	(121)	‐		‐ (1)	(122)	‐	(122)
Other comprehensive income for the period, net of tax		‐	‐	3	205	‐		‐ 1	209	‐	209
Total comprehensive income for the period		‐	‐	3	205	‐		‐ 383	591	5	596
Transactions with shareholders carried directly to equity:
Exercise and expiry of options for senior employees		‐	7	‐		‐ ‐		‐ (7)	‐	‐	‐
Share-based payments		‐	‐	‐		‐ ‐		‐ 8	8	‐	8
Dividend to non-controlling interests		‐	‐	‐		‐ ‐		‐ ‐	‐	(2)	(2)
Balance as of September 30, 2024	167	2,397		1	1,071	180	(39)	5,403	9,180	73	9,254

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

7- 2

	Attributable to Company's shareholders
In NIS million	Share capital	Share premium	Translation reserve	Capital reserve in respect of available for-sale assets	Other capital reserves	Capital reserve from transactions with non controlling interests		Re tained ear nings	Total	Non-con trolling in terests	Total equity
For the nine-month period ended
September 30, 2023 (unaudited)
Balance as of January 1, 2023 (audited)	162	2,127		(7)	788 180		(39)	4,785	7,995	65	8,061
Effect of first-time application of IFRS 9 – see Note 3(r) to the Financial Statements for 2023		‐	‐	‐	(1)	‐	‐	1	‐		‐ ‐
Income for the period		‐	‐	‐	‐	‐	‐	39	39	2	41
Other comprehensive income (loss) items:
Foreign currency translation differences in respect of foreign operations carried to capital reserve		‐	‐	13	‐	‐	‐	‐	13		‐ 13
Net change in fair value of financial assets classified as available for sale carried to capital reserve		‐	‐	‐	488	‐	‐	‐	488	(1)	487
Net change in fair value of available for sale financial assets carried to the profit and loss statement		‐	‐	‐ (301)		‐	‐	‐	(301)	1	(300)
Impairment loss of available-for-sale financial assets carried to the profit and loss statement		‐	‐	‐	47	‐	‐	‐	47		‐ 47
Tax benefit for items of comprehensive income		‐	‐	(3) (80)		‐	‐	‐	(83)		‐ (83)
Other comprehensive income for the period, net of tax		‐	‐	10	154	‐	‐	‐	164		‐ 164
Total comprehensive income for the period		‐	‐	10	154	‐	‐	39	203	2	205
Transactions with shareholders carried directly to equity:
Issuance of share capital (less issuance expenses)		5 249		‐	‐	‐	‐	‐	253		‐ 253
Share-based payments		‐	‐	‐	‐	‐	‐	9	9		‐ 9
Issuance of convertible bonds (net of tax) - equity component		‐ 13		‐	‐	‐	‐	‐	13		‐ 13
Dividend to non-controlling interests		‐	‐	‐	‐	‐	‐	‐	‐	(1)	(1)
Balance on September 30, 2023	167	2,390		3	941 180		(39)	4,833	8,474	66	8,540

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

	Attributable to Company's shareholders
In NIS million	Share capital	Share premium	Tran slation reserve	Capital reserve in respect of available for-sale assets		Other capital reserves	Capital reserve from transactions with non controlling interests	Retained earnings	Total	Non-con trolling interests	Total equity
For the three-month period ended
September 30, 2024 (unaudited)
Balance as of July 1, 2024		167 2,396		1	928	180	(39)	5,271	8,903	73	8,976
Income for the period		‐	‐	‐		‐	‐	‐	128 128	2	130
Other comprehensive income (loss) items:
Net change in fair value of financial assets classified as available for sale carried to capital reserve		‐	‐	‐	274		‐	‐	‐ 274	1	275
Net change in fair value of available for sale financial assets carried to the profit and loss statement		‐	‐	‐	(72)		‐	‐	‐ (72)	‐	(72)
Impairment loss of available-for-sale financial assets carried to the profit and loss statement		‐	‐	‐	17		‐	‐	‐ 17	‐	17
Tax benefit for items of comprehensive income		‐	‐	‐	(77)		‐	‐	‐ (77)	‐	(77)
Other comprehensive income
for the period, net of tax		‐	‐	‐	143		‐	‐	‐ 143	1	144
Total comprehensive income for the period		‐	‐	‐	143		‐	‐	128 271	3	274
Transactions with shareholders carried directly to equity:
Exercise and expiry of options for senior employees		‐	1	‐		‐	‐	‐	(1) ‐	‐	‐
Share-based payments		‐	‐	‐		‐	‐	‐	6 6	‐	6
Dividend to non-controlling interests		‐	‐	‐		‐	‐	‐	‐ ‐	(2)	(2)
Balance as of September 30, 2024		167 2,397		1	1,071	180	(39)	5,403	9,180	73	9,254

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

9- 2

	Attributable to Company's shareholders
In NIS million	Share capital		Share premium	Tran slation reserve		Capital reserve in respect of available for-sale assets	Other capital reserves	Capital reserve from transactions with non controlling interests		Retained earnings	Total	Non-con trolling interests	Total equity
For the three-month period ended
September 30, 2023 (unaudited)
Balance as of July 1, 2023		167	2,389		‐	914	180		(39)	4,705	8,316	68	8,384
Profit (loss) for the period		‐		‐	‐		‐	‐	‐	121	121	(1)	120
Other comprehensive income (loss) items:
Foreign currency translation differences in respect of foreign operations carried to capital reserve		‐		‐	4		‐	‐	‐	‐	4	‐	4
Net change in fair value of financial assets classified as available for sale carried to capital reserve		‐		‐	‐	80		‐	‐	‐	80	(1)	80
Net change in fair value of available for sale financial assets carried to the profit and loss statement		‐		‐	‐	(63)		‐	‐	‐	(63)	‐	(63)
Impairment loss of available-for-sale financial assets carried to the profit and loss statement		‐		‐	‐	23		‐	‐	‐	23	‐	23
Tax benefit for items of comprehensive income		‐		‐	(1)	(14)		‐	‐	‐	(15)	‐	(15)
Other comprehensive income for the period, net of tax		‐		‐	3	27		‐	‐	‐	29	‐	29
Total comprehensive income (loss) for the period		‐		‐	3	27		‐	‐	121	151	(1)	150
Transactions with shareholders carried directly to equity:
Share-based payments		‐		‐	‐		‐	‐	‐	8	8	‐	8
Dividend to non-controlling interests		‐		‐	‐		‐	‐	‐	‐	‐	(1)	(1)
Balance as of September 30, 2023		167	2,390		3	941	180		(39)	4,833	8,474	66	8,540

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

	Attributable to Company's shareholders
	Share	Share	Tran slation	Capital reserve in respect of available for-sale		Other capital	Capital reserve from transactions with non controlling	Retained		Non-con trolling	Total
In NIS million	capital	premium	reserve	assets		reserves	interests	earnings	Total	interests	equity
For the year ended December 31, 2023 (audited)
Balance as of January 1, 2023	162	2,127		(7)	788	180	(39)	4,785	7,995	65	8,061
Effect of first-time application of IFRS 9 - see Note 3(r) to the Financial Statements for 2023		‐	‐	‐	(1)		‐	‐ 1	‐	‐	‐
Income for the period		‐	‐	‐	‐		‐	‐ 220	220	3	223
Other comprehensive income (loss) items:
Foreign currency translation differences in respect of foreign operations carried to capital reserve		‐	‐	7	‐		‐	‐ ‐	7	‐	7
Net change in fair value of financial assets classified as available for sale carried to capital reserve		‐	‐	‐	398		‐	‐ ‐	398	‐	398
Net change in fair value of available for sale financial assets carried to the profit and loss statement		‐	‐	‐	(337)		‐	‐ ‐	(337)	1	(336)
Impairment loss of available-for-sale financial assets carried to the profit and loss statement		‐	‐	‐	60		‐	‐ ‐	60	‐	60
Tax benefit for items of comprehensive income		‐	‐	(2)	(41)		‐	‐ ‐	(43)	‐	(43)
Other comprehensive income for the period, net of tax		‐	‐	5	79		‐	‐ ‐	85	1	86
Total comprehensive income for the period		‐	‐	5	79		‐	‐ 221	305	4	309
Transactions with shareholders carried
directly to equity:
Issuance of share capital		5	249	‐	‐		‐	‐ ‐	253	‐	253
Share-based payments		‐	‐	‐	‐		‐	‐ 14	14	3	17
Issuance of convertible bonds (net of tax) - equity component		‐	13	‐	‐		‐	‐ ‐	13	‐	13
Dividend to non-controlling interests		‐	‐	‐	‐		‐	‐ ‐	‐	(1)	(1)
Balance as of December 31, 2023	167	2,390		(2)	866	180	(39)	5,019	8,581	71	8,652

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

11 - 2

		September 30	For the nine-month period ended	For the three month period ended September 30		For the year ended December 31
		2024	(**2023	2024	(**2023	(**2023
In NIS million	Appendix		Unaudited			Audited
Cash flows from operating activities
Net income before income tax	(a)	1,274	(*(4,696)	633	(*22	(4,072)
Income tax received (paid)		(60)	(156)	(77)	(32)	(240)
Net cash provided by (used in)
operating activities		1,214	(*(4,852)	555	(*(10)	(4,312)
Cash flows from investing activities
Credit provided to card holders and merchants, net Proceeds from the disposal of an investment in financial assets by companies other than insurance		(1,103)	(566)	(535)	(349)	(428)
and finance companies		976	106	‐	20	106
Deferred payment in the Max acquisition Investment in financial assets by companies other		‐	‐	‐	‐	(380)
than insurance and finance companies		(95)	(413)	(62)	(401)	(908)
Investments in shares and loans in investees Acquisition of a company consolidated for the first		‐	(4)	‐	‐	(4)
time net of cash received	(f)	‐	(294)	‐	‐	(294)
Investment in fixed assets		(61)	(*(23)	(35)	(*(11)	(32)
Investment in intangible assets		(267)	(*(210)	(96)	(*(82)	(296)
Net cash used for investing activities		(550)	(1,403)	(728)	(823)	(2,236)
Cash flows provided by financing activities
Credit from banking corporations, net		(466)	182	421	172	46
Proceeds from the issue of subordinated notes and bonds (see Note 6)		1,017	1,572	‐	928	2,071
Costs of issuing and exchanging subordinated notes and bonds		(7)	(11)	‐	(7)	(15)
Repayment of subordinated notes (See Note 6)		(817)	‐	(456)	‐	(431)
Repayment of lease liability		(55)	(66)	(22)	(23)	(93)
Interest paid on bonds, subordinated notes, and credit from banking corporations		(231)	(*(99)	(96)	(*(25)	(141)
Dividend paid to non-controlling interests		(2)	‐	(2)	‐	(1)
Net cash provided by financing activities		(562)	(*1,578	(155)	(*1,045	1,436
Effect of exchange rate fluctuations on balance of
cash and cash equivalents		(43)	231	(58)	92	27
Net increase (decrease) in
cash and cash equivalents		59	(4,446)	(386)	304	(5,084)
Cash and cash equivalents at the
beginning of the period Cash and cash equivalents	(b)	6,966	12,050	7,411	7,299	12,050
at the end of the period	(c)	7,025	7,603	7,025	7,603	6,966

Consolidated Interim Statements of Cash Flow

*) Reclassified.

**) CIMax Group was consolidated for the first time as of March 31, 2023, such that its results were included as of that date. For further details, see Note 9 to the Financial Statements for 2023.

	For the nine-month period ended September 30		For the three month period ended September 30		For the year ended December 31
	2024	(**2023	2024	(**2023	(**2023
In NIS million		Unaudited			Audited
(a) Cash flows from operating activities before income taxes ¹) ²)
Profit (loss) for the period	387	41	130	120	223
Items not involving cash flows:
The Company's share in losses (profits)
of equity-accounted investees	(11)	(8)	(8)	(3)	(8)
Dividend received from equity-accounted investees	1	‐	1	‐	‐
Change in liabilities in respect of insurance contracts and non yield-dependent investment contracts	999	1,035	644	222	362
Change in liabilities in respect of insurance contracts and
yield-dependent investment contracts	2,891	1,044	1,910	(1,192)	1,813
Change in deferred acquisition costs	(59)	(110)	(22)	(23)	(87)
Change in reinsurance assets	(124)	(18)	(121)	43	719
Depreciation of property, plant, and equipment and right-of
use asset	91	*(89	29	(*34	125
Amortization of intangible assets	265	*(233	96	(*87	332
Credit loss expenses	159	(***353	62	86	(***411
Amortization of excess cost for credit card receivables	(50)	(92)	(10)	(30)	(103)
Impairment of intangible assets	‐	‐	‐	‐	5
Loss (income) from a right-of-use asset	1	‐	‐	‐	‐
Interest and linkage differentials accrued for subordinated notes and a lease liability	252	188	82	80	235
Accrued interest and revaluation of liabilities to banking and
other corporations	382	(*(29)	185	(*9	289
Interest paid in Max	(344)	(*(202)	(127)	(*(109)	(340)
Change in fair value of investment property in respect of
yield-dependent contracts	‐	(7)	(2)	‐	13
Changes in fair value of other investment property	(2)	7	(3)	6	21
Share-based payment transactions	8	9	6	8	17
Investment losses (income), net on financial investments in respect of insurance contracts and yield-dependent
investment contracts	(6,354)	(*(2,244)	(3,129)	(*45	(3,940)
Taxes (tax benefit) on income	196	3	60	53	124
Losses (gains), net on other financial investments:
Liquid debt assets	(101)	(15)	(78)	4	29
Illiquid debt assets	(956)	(897)	(548)	(350)	(1,073)
Shares	(39)	(101)	(7)	34	(66)
Other	21	(*432	(110)	(*239	95

Consolidated Interim Statements of Cash Flow (cont.)

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.

*) Reclassified.

**) CIMax Group was consolidated for the first time as of March 31, 2023, such that its results were included as of that date. For further details, see Note 9 to the Financial Statements for 2023.

***) Total expense includes a provision for credit default following Max's acquisition, see Note 3(i)(1)(d) to the Consolidated Annual Financial Statements for 2023.

	For the nine-month period ended September 30		For the three-month period ended September 30		For the year ended December 31
	2024	(**2023	2024	(**2023	(**2023
In NIS million		Unaudited			Audited
(a) Cash flows from operating activities before income taxes (cont.)
Financial investments and investment property in
respect of yield-dependent contracts:
Acquisition of investment property	(54)	(57)	(13)	(18)	(74)
Sales (acquisitions), net of financial investments	3,807	(*(3,103)	1,417	(*1,592	(3,528)
Proceeds (investments) from the sale of available for-sale financial assets and investment property in
insurance businesses:
Liquid debt assets	398	898	179	159	665
Illiquid debt assets	(205)	(509)	113	(341)	(352)
Shares	46	163	43	6	150
Other	62	91	(63)	(7)	(450)
Derivatives	(947)	(*(1,101)	(99)	(*(139)	(864)
Acquisition of other investment property	(22)	(21)	(5)	(9)	(28)
Changes in other items in the statement of financial position, net
Securities held for trading by consolidated companies that
are not insurance companies	(12)	(7)	(1)	(4)	(4)
Receivables for credit card transactions, net	(1,266)	60	(632)	(210)	472
Receivables and debit balances	477	66	110	(471)	1,474
Collectible premium	(169)	(123)	20	(5)	16
Payables and credit balances	21	(670)	(212)	17	(184)
Payables for credit card transactions	1,525	(97)	732	87	(558)
Liabilities for employee benefits, net	(1)	3	2	2	1
Total cash Flows from operating activities before
income taxes	1,274	(*(4,696)	633	(*22	(4,072)
(b) Cash and cash equivalents at the beginning of the period:
Cash and cash equivalents in respect of yield-dependent
contracts	4,418	8,458	4,584	3,910	8,458
Other cash and cash equivalents	2,548	3,591	2,827	3,389	3,591
Balance of cash and cash equivalents at beginning of period	6,966	12,050	7,411	7,299	12,050
(c) Cash and cash equivalents at end of the period:
Cash and cash equivalents in respect of yield-dependent
contracts	5,011	4,552	5,011	4,552	4,418
Other cash and cash equivalents	2,014	3,052	2,014	3,052	2,548
Balance of cash and cash equivalents at end of period	7,025	7,603	7,025	7,603	6,966
(d) Cash flows for interest and dividend received, included in operating activity:
Interest received	1,581	1,418	559	217	2,147
Dividend received	516	382	140	129	479

Consolidated Interim Statements of Cash Flow (cont.)

*) Reclassified.

**) CIMax Group was consolidated for the first time as of March 31, 2023, such that its results were included as of that date. For further details, see Note 9 to the Financial Statements for 2023.

Consolidated Interim Statements of Cash Flow (cont.)

	For the nine-month period ended September 30		For the three-month period ended September 30		For the year ended December 31
	2024	(**2023	2024	(**2023	(**2023
In NIS million		Unaudited			Audited
Included in investing activity by Max:
Interest received	932	623	315	320	939
(E) Transactions not involving cash flows:
Payables - unpaid declared dividend	‐	1	‐	1	‐
Payables - purchase of insurance portfolios	15	6	5	6	7
Replacement of notes	187	‐	‐		‐ ‐
(F) First-time consolidation of an
acquired company:
Excess cost upon acquisition (see Note 5 below)	‐	(281)	‐		‐ (281)
Goodwill upon acquisition (see Note 5 below)	‐	(428)	‐		‐ (428)
Intangible assets		(255)	‐		‐ (255)
Deferred tax assets	‐	(38)	‐		‐ (38)
Current tax assets	‐	(1)	‐		‐ (1)
Property, plant & equipment	‐	(131)	‐		‐ (131)
Right-of-use asset	‐	(198)	‐		‐ (198)
Receivables for credit card transactions, net	‐	(15,432)	‐		‐ (15,432)
Receivables and debit balances	‐	(52)	‐		‐ (52)
Other financial investments	‐	(3)	‐		‐ (3)
Issuance of Company shares (see Note 7 below)	‐	253	‐		‐ 253
Investments in investees	‐	(7)	‐		‐ (7)
Liability for employee benefits, net	‐	27	‐		‐ 27
Lease liability	‐	198	‐		‐ 198
Deferred tax liabilities	‐	8	‐		‐ 8
Liabilities for current taxes	‐	22	‐		‐ 22
Payables for credit card transactions	‐	8,649	‐		‐ 8,649
Payables and credit balances	‐	463	‐		‐ 463
Deferred payment in the CIMax acquisition
(presented under payables and credit balances)	‐	377	‐		‐ 377
Liabilities to banking corporations and others	‐	6,535	‐		‐ 6,535
Total investment in acquisition of
consolidated companies consolidated for the first time	‐	(294)	‐		‐ (294)
Consideration paid	‐	(790)	‐		‐ (790)
Cash of the acquired company	‐	496	‐		‐ 496
Total investment in acquisition of
consolidated companies consolidated for
the first time	‐	(294)	‐		‐ (294)

**) CIMax Group was consolidated for the first time as of March 31, 2023, such that its results were included as of that date. For further details, see Note 9 to the Financial Statements for 2023.

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 September 30, 2024 (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 insurance, pension, provident and finance domains, credit card domain (issuing, acquiring, and processing of debit cards, as well as providing payment solutions and financial products, including credit to private and business customers), and holds other assets and businesses (such as insurance agencies).

For further details, see Note 1 to the consolidated financial statements for 2023.

Further to Note 1(b)(1) to the Consolidated Financial Statements for 2023, it is noted that in May 2024, the Draft Regulations regarding Economic Competition and Minimizing Market Concentration (Financial Entity) (Amendment No. 1), 2024 was published, as part of which it is suggested to expand the list of entities to be included in the definition of "financial entities" in the Market Concentration Law, such that, among other things, it will also include an insurer's issuing corporation which is a wholly owned subsidiary of an insurer (as defined in the Companies Regulations (Reliefs for Certain Types of Bond Companies), 2012.

If the Draft Regulations become binding, this will trigger the definition of Clalbit Finance Ltd. (hereinafter - "Clalbit Finance") as a financial entity, such that if the amount of Clalbit Finance's liabilities will not be taken into account together with the other liabilities of Clal Holdings and of the non-financial corporations controlled by the Clal Holdings Group, and Clal Holdings will be allowed to continue holding Clal Insurance and Clalbit Finance even if their total liabilities will exceed the threshold of liabilities, which a non-financial entity holding a significant financial entity may have.

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 controlling core.

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 2023, 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 the 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 controlling 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 controlling 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 2023, 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.

NOTE 2 – BASIS OF PREPARATION OF THE INTERIM FINANCIAL STATEMENTS

A. Financial reporting framework

The consolidated interim financial statements of the Group as of September 30, 2024, and for the nine- and three-month periods 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 IFRS, including in connection with the data relating to insurer consolidated subsidiaries, as defined in the Securities Regulations (Preparation of Annual Financial Statements), 2010.

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, those financial statements data that relate to a consolidated subsidiary, which falls within the scope of the definition of insurer, as defined in the Securities Regulations (Preparation of Annual Financial Statements), 2010, are drawn up in accordance with the requirements set by the Commissioner in accordance with the Financial Services Supervision Law (Insurance), 1981.

In accordance with requirements set by the Commissioner, the first-time application date of IFRS 17 regarding Insurance Contracts and IFRS 9 regarding Financial Instruments was postponed to January 1, 2025 (see Note 3 and 13 below) (instead of the first-time application date that was set in the standard itself - January 1, 2023). Consequently, during the periods through the date of first-time application in Israel, those data in the financial statements that relate to the subsidiary, as stated above, continue to be drawn up in accordance with IFRS 4 regarding Insurance Contracts, and IAS 39, Financial Instruments (of 2017).

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 and 5 below. These directives basically adopt the US GAAP for Banks.

In addition, for the other issues, including regarding the information in the financial statements that does not refer to insurer consolidated subsidiaries, the consolidated interim financial statements are prepared in accordance with IAS 34, Interim Financial Reporting.

The information presented under comparative figures of the Condensed Consolidated Interim Financial Statements is information published by the Group in those periods.

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, 2023 (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 November 28, 2024.

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, income and expenses. It is clarified that the actual results may differ from those estimates.

The judgment of management, when applying the Group's accounting policy 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, except as follows:

In this context, see Note 12(d) below, regarding revised actuarial estimates.

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 rep resentative exchange rate	USD rep resentative exchange rate	GBP rep resentative exchange rate
		%
For the nine-month period ended
September 30, 2024	3.4	3.5 3.5	2.3	7.7
September 30, 2023	2.9	3.2	8.0 8.7	10.5
For the three-month period ended
September 30, 2024	1.3	1.6 3.3	(1.3)	4.7
September 30, 2023	0.7	0.8	0.9 3.4	0.2
For the year ended December 31, 2023	3.0	3.3	6.9 3.1	9.1

	EUR rep resentative exchange rate	USD rep resentative exchange rate	GBP rep resentative exchange rate
As of September 30, 2024	4.152	3.710	4.975
As of September 30, 2023	4.053	3.824	4.678
As of December 31, 2023	4.012	3.627	4.621

NOTE 3 - SIGNIFICANT ACCOUNTING POLICIES

The Group's accounting policy applied in the Consolidated Interim Financial Statements is the same accounting policy applied in the Consolidated Financial Statements for 2023.

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

1. Amendment to IFRS 16, Leases

In September 2022, the IASB published an amendment to IFRS 16, Leases (hereinafter - the "Amendment"), whose objective is to provide an accounting treatment in the financial statements of the seller-lessee in sale and leaseback transactions, when the lease payments are variable lease payments that do not depend on an index or rate. As part of the amendment, the seller-lessee is required to adopt one of two approaches to measure the lease liability at the initial recognition date of such transactions. The selected approach constitutes an accounting policies that should be implemented consistently.

The Amendment shall be applied as from annual periods beginning on January 1, 2024; earlier application is permitted. The Amendment shall be applied retrospectively.

The above Amendment did not have a material effect on the Consolidated Interim Financial Statements of the Company.

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

As from the reporting periods starting on January 1, 2024, Max applies new provisions and accounting standards regarding this issue, as detailed below:

A. Revision of ASU 2022-02 to the Accounting Standards Codification regarding modifications to the terms and conditions of debts of distressed borrowers and disclosure requirements in accordance with the year in which credit was provided.

Below is a description of the nature of the modifications applied in the accounting policies in these Condensed Consolidated Interim Financial Statements, and a description of the manner and effect of any first-time application:

On March 31, 2022, the Financial Accounting Standards Board (FASB) published ASU 2022-02 regarding modifications to the terms and conditions of debts of distressed borrowers and disclosure requirements on credit loss provisions in accordance with the year in which credit was provided (hereinafter - the "Revision").

The ASU revokes the provisions relating to restructuring of troubled debts by lenders, while improving disclosure requirements regarding borrowers in financial difficulties. The ASU also adds a disclosure requirements of gross write-offs, by credit granting year.

On October 19, 2023, the Banking Supervision Department published a circular on "Modifications to Terms and Conditions of Debts of distressed borrowers", revising the Reporting to the Public Directives in accordance with the revision of accounting standards on this issue.

The main modifications in the circular include, among other things: Cancelling the definition of "debts that have undergone troubled debt restructuring", including the requirement to check whether Max granted a concession to determine this classification, and replacing it with the phrase "changes in terms and conditions of debts of distressed borrowers"; updating the disclosure requirements in the financial statements, such that disclosure will be given in respect of each change in the terms and conditions of a debt to distressed borrowers, which includes a waiver of the principal, reduction of the interest rate or term extension which does not trigger insignificant postponement of payments; cancelling the requirement to calculate the credit loss provision using the discounted cash flow method, for troubled debt which underwent restructuring, using the discounted cash flow method; expanding the disclosure about the "credit quality according to the year the credit was provided", such that it includes information about gross charge-offs carried out during the year.

Banking corporations were required to apply the directive as from January 1, 2024, in accordance with guidance and Transitional Provisions set forth in the directive.

The application of the directive does not affect the measurement method of the credit loss provision and did not lead to any change in Max's the credit loss provision.

The application of the directive leads to a change in the format of disclosure regarding those debts. Max adopted, at the initial application date, certain expedients, as provided by the Transitional Provisions, including determining the balance of the debts of distressed borrowers which underwent a change in terms and conditions until December 31, 2023, according to the balance of troubled debt restructurings until December 31, 2023. In addition, according to the Transitional Provisions, in the report for the first quarter of 2024, Max did not include a quantitative disclosure in the format established for details of the types of changes made during that quarter to debts of distressed borrowers, details of the financial effects of such changes, and details of the types of changes to debts that were defaulted on during that quarter after undergoing a change in terms and conditions. These disclosures were revised starting with the financial statements for the second quarter of 2024. In accordance with the directive, comparative data will not be restated.

For further details, see the note entitled Credit Risk, Receivables for Credit Card Transactions and Credit Loss Provision.

B. The revision to the accounting policies, which were applied following the first-time application of the new accounting principles on modifications to the terms and conditions of debts of distressed borrowers (instead of troubled debt restructuring):

Policies on debt settlement arrangements and accounting for modifications to the terms and conditions of debts of distressed borrowers (instead of troubled debt restructuring)

Modifications to the terms and conditions of debts of distressed borrowers is generally carried out for customers, whose debts were identified as troubled, and through debt rescheduling, reducing the periodic payments, or postponing the payment dates.

In order to determine whether a debt settlement arrangement executed by Max constitutes a modification to the terms and conditions of debts of distressed borrowers, Max assesses all the terms and conditions of the debt settlement arrangement and the circumstances in which it was executed.

In order to determine whether the borrower has financial difficulties, Max assesses whether there are indications of difficulties as of the restructuring date or whether it is reasonably probable that the borrower will have financial difficulties were it not for the restructuring. Among other things, Max assesses whether one or more of the following criteria are met:

The debtor is currently in payment default on any of its debt, or it is probable that the debtor would be in payment default on any of its debt in the foreseeable future without the modification.
The debtor has declared or is in the process of declaring bankruptcy or other receivership.
There is substantial doubt as to whether the debtor will continue to be a going concern.
Without the current modification, the debtor cannot obtain funds from sources other than the existing creditors at an effective interest rate equal to the current market interest rate for similar debt for a nontroubled debtor.

Max does not classify a debt settlement arrangement as a modification to the terms and conditions of debts of distressed borrowers, if the modification results in an insignificant delay in payment, considering the frequency or the payments, the remaining contractual maturity, and the debt's original expected duration.

C. New standards and interpretations not yet adopted:

1. Disclosure of the new IFRSs in the period prior to their application by Group companies excluding Max:

For details regarding IFRS 17, Insurance Contracts and IFRS 9, Financial Instruments (for Clal Insurance), see Note 13 below.

Standard / interpretation / ASU	Topic	Effective date and Transitional Provisions	Expected main effects
IFRS 18, Presentation and Disclosure in Financial Statements	In April 2024, the International Accounting Standards Board (IASB) published IFRS the "New 18 - Presentation and Disclosure in Financial Statements (hereinafter - Standard") - which supersedes IAS 1 - Presentation of Financial Statements (hereinafter - "IAS 1"). The New Standard is aimed at improving the comparability and transparency of communication of financial statements. The New Standard includes requirements previously included in IAS 1 and introduces new requirements on presentation within the statement of profit or loss, including the presentation of totals and subtotals required under the New Standard, disclosure of management-defined performance measures, and new requirements for the aggregation and disaggregation of financial information. The New Standard does not change the provisions regarding recognition and measurement of items in the financial statements. However, since items in the statement of profit or loss must be classified into one of five categories (operating, investing, financing, income taxes, and discontinued operation), it may alter the operating income of the entity. In addition, the publication of the New Standard triggered limited amendments to other accounting standards, including IAS 7 - Statement of Cash Flow - and IAS 34 - Interim Financial Reporting.	The New Standard was applied retrospectively as from annual periods beginning on January 1, 2027. Early application is permitted, provided a disclosure is made. In accordance with the resolution of the Israel Securities Authority's plenum, reporting corporations may early adopt the standard starting with reporting periods beginning on January 1, 2025.	The Company is studying the effect - on the consolidated financial statements - of the New Standard, including the effect of consequential amendments to other accounting standards.

21 - 2

2. Disclosure of US GAAP and new directives issued by the Banking Supervision Department in the period preceding their application

ASU	Topic	Effective date and Transitional Provisions	Expected main effects
Revision to ASU 2023-07 regarding Improvements to Reportable Segment Disclosures	On November 27, 2023, the Financial Accounting Standards Board (FASB) published ASU 2023-07 regarding Improvements to Reportable Segment Disclosures (hereinafter - the "ASU"). The ASU improves the disclosure requirements that apply to entities, including adding a requirement to provide disclosure in the segments note regarding 'significant expenses' reported to the chief operating decision maker (CODM), explaining the manner by which the CODM uses segment reporting, expanding the scope of certain annual disclosure requirements to interim periods, disclosing the identity and title of the CODM, and a clarification to the effect that ASC 280 also applies to entities with a single segment.	The provisions of the ASU will be applicable to publicly-traded entities in the US as of the annual periods commencing after December 15, 2023 and interim periods commencing after December 15, 2024. Early application is permitted. Upon first-time application, the entity is required to apply this ASU retrospectively for all the periods presented in the financial statements, unless it is impractical.	Max and the Company are examining the effect of the new provisions on its financial statements.
Revision to ASU 2023-09 regarding Improvements to Income Tax Disclosures	On December 14, 2023, the Financial Accounting Standards Board (hereinafter - the "FASB") published ASU 2023-09 regarding Improvements in Income Tax Disclosures (hereinafter - the "ASU").The amendments under the ASU add new improved disclosure requirements and remove certain disclosure requirements.	The provisions of the ASU will be applicable to publicly-traded entities in the US as of the annual periods commencing after December 15, 2024. Early application is permitted. Upon first time application, the entity is required to apply this ASU prospectively. Retrospective application for prior presented periods is permitted.	Max and the Company are examining the effect of the new provisions on its financial statements.

NOTE 4 – SEGMENT REPORTING

A. General

The Group operates in the following operating segments:

1. Long-term savings

The Long-Term Savings Segment comprises life insurance, related coverages (appendices), and management of pension 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, permanent health, 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 Subsegment 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 long-term care insurance, medical expenses insurance, surgery, transplants, personal accidents (Long-Term Health Subsegment), travel, dental insurance, foreign workers insurance and more.

3. P&C insurance

The Property and Casualty Insurance Segment comprises the Liability and Property Subsegments, credit insurance, personal accidents insurance and other.

In accordance with the Commissioner's Directives, the Property and Casualty Insurance Segment is broken down into Compulsory Motor Insurance, Motor Property, Property and Other Subsegments, Credit Insurance and Other Liability Subsegments, as follows:

• Compulsory Motor Subsegment

The Compulsory Motor Subsegment focuses on coverage, the purchase of which by the vehicle owner or driver is mandatory, in respect of bodily injury caused as a result of the use of a motor vehicle (to the driver, passengers, or pedestrians).

• Motor Property Subsegment

The motor property subsegment focuses on coverage against property damage to the policyholder's vehicle and third-party property damage caused by the insured vehicle.

• Property and Other Subsegments

All remaining Property Insurance Subsegments other than the Motor And Liability Insurance Subsegments and Other Insurance Subsegments, such as guarantees and personal accidents (Short-Term Health Insurance Subsegment).

• Credit Insurance through a Consolidated Company

The credit insurance and foreign trade insurance subsegments.

• Other Liability Subsegments

The liability subsegments provide coverage in respect of the policyholder's liability for any third-party damage he/she may cause. These subsegments include: third-party liability, employers' liability, professional liability and product liability.

4. The Credit Cards Segment

Includes credit card company operating results, divided into two main subsegments: issuing and acquiring.

Issuing Subsegment

The Issuing Subsegment focuses on 2 main activities:

Solutions for financial institutions - joint credit card issuing and processing with banks, for their customers (B2B2C); hereinafter – "bank payment cards".
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 income 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.

The companies were initially consolidated as from March 31, 2023, such that the quantitative segment information in respect thereof set forth below in relation to 2023 does not includes the results of the first quarter of that year, and furthermore - the results of the first quarter of 2023 do not include the results of this operating segment, other than a provision for credit default according to CECL at the time of the CIMax acquisition; for further details, see Note 3(i)(1)(d) to the Consolidated Financial Statements for 2023.

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. Long-Term Savings Segment

Generally, the income from life insurance premiums, and management fees income from pension and provident funds are not affected by seasonality, and therefore claims are also not affected by seasonality.

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 premiums 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 vehicle fleets at the beginning of the calendar year, which reflects a certain degree of seasonality. The effect of this seasonality on the reported profit is neutralized through the provision for unearned premium.

There is no significant seasonality in other components of expenses, such as claims, and in components of income, such as investment income. 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

	Long-Term Savings
		Provident		Pension Life Insurance ¹)						Total
		For the nine			For the			For the			For the
	month period ended		For the	nine-month		For the		nine-month		For the	nine-month		For the year ended
			year ended	period ended		year ended		period ended		year ended	period ended
	September 30		December 31	September 30		December 31		September 30		December 31	September 30		December 31
	2024	2023	2023	2024	2023	2023			2023	2023	2024	2023	2023
In NIS million	Unaudited		Audited	Unaudited		Audited		Unaudited		Audited	Unaudited		Audited
Premiums earned, gross	‐	‐	‐	‐		‐	‐	3,866	4,681	6,041	3,866	4,681	6,041
Premiums earned by reinsurers	‐	‐	‐	‐		‐	‐	246	128	171	246	128	171
Premiums earned - retention	‐	‐	‐	‐		‐	‐	3,620	4,552	5,870	3,620	4,552	5,870
Investment income, net and finance income	187	179	217	3		1	1	8,958	4,851	7,425	9,148	5,031	7,643
Income from management fees	224	217	293	297	275		371	444	446	594	965	938	1,258
Income from fees and commissions	‐	‐	‐	‐		‐	‐	26	19	30	26	19	30
Total income	411	397	510	300	276		372	13,047	9,868	13,919	13,759	10,541	14,801
Payments and change in liabilities in respect
of insurance contracts and investment
contracts, gross	185	176	212	‐		‐	‐	12,635	9,108	12,679	12,819	9,283	12,891
Reinsurers' share in payments and in
changes in liabilities in respect of
insurance contracts	‐	‐	‐	‐		‐	‐	(226)	(109)	(144)	(226)	(109)	(144)
Payments and change in liabilities in respect
of insurance contracts and investment
contracts - retention	185	176	212	‐		‐	‐	12,409	8,999	12,535	12,594	9,175	12,747
Fees and commissions, marketing expenses
and other purchase expenses	103	106	141	95	87		118	543	548	721	741	740	979
General and administrative expenses	112	104	142	165	149		204	273	262	368	551	516	713
Impairment of intangible assets	‐	‐	‐	‐		‐	1	‐	‐	‐	‐	‐	1
Other expenses	5	5	6	3		3	5	‐	‐	‐	9	8	11
Finance expenses	‐	‐	‐	‐		‐	‐	21	13	19	21	13	19
Total expenses	405	390	501	264	239		327	13,247	9,822	13,642	13,916	10,452	14,471
Share in results of equity-accounted
investees, net	‐	‐	‐	1		‐	‐	(1)	‐	‐	(1)	‐	‐
Profit (loss) before taxes on income	6	7	9	37	37		45	(201)	46	277	(158)	90	331
Other comprehensive income (loss) before
income tax	‐	1	2	‐		1	2	93	59	(52)	94	61	(48)
Total comprehensive income (loss)
before income tax	6	8	10	37	38		47	(107)	105	225	(64)	151	282

	Long-Term Savings
		Provident	Pension			Life Insurance ¹)			Total
	As of As of December September 30 31		As of As of December September 30 31		As of September 30		As of December 31	As of September 30		As of December 31
	2024	2023	2023	2024	2023	2023	2024	2023	2023	2024	2023	2023
In NIS million	Unaudited		Audited	Unaudited		Audited	Unaudited		Audited	Unaudited		Audited
Liabilities in respect of insurance contracts and non-yield-dependent
investment contracts	2,542	2,471	2,470	‐		‐ ‐	21,903	21,437	21,418	24,445	23,908	23,889
Liabilities in respect of insurance contracts and yield-dependent investment contracts	‐	‐	‐	‐		‐ ‐	93,325	89,779	90,528	93,325	89,779	90,528
1)Total premiums (including pure savings premiums (investment contracts) recognized directly in the reserve)							4,456	5,613	7,122	4,456	5,613	7,122

27 - 2

	Health				Property and Casualty			Credit cards		Other
	For the nine month period ended September 30		For the year ended December 31	For the nine month period ended September 30		For the year ended December 31	For the nine month period ended September 30		For the year ended December 31	For the nine month period ended September 30		For the year ended December 31
	2024	2023	2023	2024	2023	2023	2024	2023	2023	2024	2023	2023
In NIS million	Unaudited		Audited	Unaudited		Audited	Unaudited		Audited	Unaudited		Audited
Premiums earned, gross	1,377	1,306	1,733	2,797	2,547	3,432	‐	‐	‐	‐	‐	‐
Premiums earned by reinsurers	81	69	90	1,039	1,091	1,447	‐	‐	‐	‐	‐	‐
Premiums earned - retention	1,296	1,237	1,644	1,758	1,456	1,984	‐	‐	‐	‐	‐	‐
Income from credit card transactions	‐	‐	‐	‐	‐	‐	1,151	760	1,083	‐	‐	‐
Investment income, net and finance income	279	190	265	220	170	227	958	629	948	1	2	(8)
Income from fees and commissions	10	8	10	160	166	222	14	‐	7	182	160	220
Total income	1,585	1,435	1,919	2,138	1,792	2,434	2,123	1,392	2,038	183	161	212
Payments and change in liabilities in respect of insurance contracts and investment contracts, gross	970	954	1,348	1,664	1,417	1,825	‐	‐	‐	‐	‐	‐
Reinsurers' share in payments and in changes in liabilities in respect of
insurance contracts Payments and change in liabilities in respect	(64)	(65)	(81)	(540)	(415)	(446)	‐	‐	‐	‐	‐	‐
of insurance contracts and investment
contracts - retention	906	889	1,267	1,125	1,002	1,379	‐	‐	‐	‐	‐	‐
Credit loss expenses	‐	‐	‐	‐	‐	‐	159	133	191	‐	‐	‐
Credit card processing	‐	‐	‐	‐	‐	‐	718	496	739	‐	‐	‐
Payments to banks	‐	‐	‐	‐	‐	‐	173	115	166	‐	‐	‐
Fees and commissions, marketing expenses
and other purchase expenses	500	478	625	514	490	675	336	190	278	135	116	155
General and administrative expenses	72	68	90	70	60	102	69	48	71	13	11	16
Other expenses	‐	‐	‐	‐	‐	‐	‐	‐	‐	7	5	6
Finance expenses	4	3	4	6	21	18	363	232	356	2	‐	1
Total expenses	1,481	1,439	1,986	1,714	1,573	2,174	1,818	1,214	1,801	157	133	178
Share in results of equity-accounted
investees, net	‐	‐	‐	(2)	‐	‐	4	1	1	10	8	10
Profit (loss) before taxes on income	104	(4)	(67)	422	219	259	309	179	238	36	36	44
Other comprehensive income (loss) before income tax	16	1	(11)	8	39	53	‐	‐	‐	‐	‐	‐
Total comprehensive income (loss) before income tax	120	(3)	(77)	431	258	312	309	179	238	36	36	44

	Health				Property and Casualty			Credit cards		Other
	As of September 30		As of December 31	As of September 30		As of December 31	As of September 30		As of December 31	As of September 30		As of December 31
	2024	2023	2023	2024	2023	2023	2024	2023	2023	2024	2023	2023
In NIS million	Unaudited		Audited	Unaudited		Audited	Unaudited		Audited	Unaudited		Audited
Liabilities in respect of insurance contracts and non-yield-dependent
investment contracts	3,055	2,777	2,906	7,678	8,165	7,383	‐		‐ ‐		‐	‐ ‐
Liabilities in respect of insurance contracts and yield-dependent investment contracts	1,250	1,136	1,156	‐	‐	‐	‐		‐ ‐		‐	‐ ‐

29 - 2

		Not allocated to segments			Adjustments and offsets
	For the nine month ended September 30	period	For the year ended December 31	For the nine-month period ended September 30		For the year ended December 31	For the nine-month period ended September 30		For the year ended December 31
	2024	2023	2023	2024	2023	2023	2024	2023	2023
In NIS million	Unaudited		Audited	Unaudited		Audited	Unaudited		Audited
Premiums earned, gross	‐	‐	‐	(3)	(1)	(4)	8,038	8,533	11,202
Premiums earned by reinsurers	‐	‐	‐	‐	‐	‐	1,366	1,288	1,708
Premiums earned - retention	‐	‐	‐	(3)	(1)	(4)	6,671	7,244	9,495
Income from credit card transactions	‐	‐	‐	‐	‐	‐	1,151	760	1,083
Investment income, net and finance income	135	(65)	60	51	93	104	10,792	6,049	9,238
Income from management fees	‐	‐	‐	1	1	1	966	940	1,259
Finance income (expenses) from fees and commissions	‐	‐	‐	(65)	(72)	(99)	326	281	390
Other income	‐	‐	‐	‐	‐	‐	‐	3	‐
Total income	135	(65)	60	(17)	21	2	19,906	15,277	21,464
Payments and change in liabilities in respect of insurance contracts and investment
contracts, gross	‐	‐	‐	(2)	(2)	(2)	15,452	11,653	16,062
Reinsurers' share in payments and in changes in liabilities in
respect of insurance contracts	‐	‐	‐	‐	‐	‐	(829)	(589)	(671)
Payments and change in liabilities in respect of insurance contracts and investment
contracts - retention	‐	‐	‐	(2)	(2)	(2)	14,623	11,064	15,391
Credit loss expenses	‐	‐	‐	‐	220	220	159	353	411
Credit card processing	‐	‐	‐	‐	‐	‐	718	496	739
Payments to banks	‐	‐	‐	‐	‐	‐	173	115	166
Fees and commissions, marketing expenses and other purchase expenses	‐	‐	‐	(65)	(72)	(99)	2,160	1,943	2,613
General and administrative expenses	59	61	97	‐	‐	2	834	763	1,092
Impairment of intangible assets	‐	‐	4	‐	‐	‐	‐	‐	5
Other expenses	1	‐	‐	17	13	23	34	25	40
Finance expenses (income)	242	211	294	(5)	‐	(22)	633	481	669
Total expenses	302	272	395	(54)	159	121	19,334	15,241	21,125
Share in results of equity-accounted investees, net	(1)	(1)	(3)	‐	‐	‐	11	8	8
Profit (loss) before taxes on income	(167)	(338)	(338)	38	(139)	(120)	583	44	347
Other comprehensive income before income tax	212	147	135	‐	‐	‐	331	247	129
Total comprehensive income (loss) before income tax	45	(191)	(203)	38	(139)	(120)	914	291	476

			Not allocated to segments		Adjustments and offsets		Total
	As of September 30		As of December 31	As of September 30		As of December 31	As of September 30		As of December 31
	2024	2023	2023	2024	2023	2023	2024	2023	2023
In NIS million	Unaudited		Audited	Unaudited		Audited	Unaudited		Audited
Liabilities in respect of insurance contracts and non-yield-dependent investment contracts	‐		‐	‐ (2)	(1)	(1)	35,175	34,849	34,176
Liabilities in respect of insurance contracts and yield-dependent investment contracts	‐		‐	‐ (19)	(18)	(18)	94,556	90,897	91,665

31 - 2

	Long-Term Savings
	Provident		Pension		Life Insurance ¹)		Total
	For the three month period ended September 30		For the three month period ended September 30		For the three month period ended September 30		For the three month period ended September 30
	2024	2023	2024	2023	2024	2023	2024	2023
In NIS million				Unaudited
Premiums earned, gross	‐	‐	‐	‐	1,274	1,483	1,274	1,483
Premiums earned by reinsurers	‐	‐	‐	‐	83	45	83	45
Premiums earned - retention	‐	‐	‐	‐	1,191	1,438	1,191	1,438
Investment income, net and finance income	71	53	1	1	4,200	506	4,272	561
Income from management fees	74	73	102	96	148	148	325	316
Income from fees and commissions	‐	‐	‐	‐	7	10	7	10
Total income	145	126	103	97	5,546	2,103	5,795	2,326
Payments and change in liabilities in respect of insurance contracts and investment contracts, gross	71	49	‐	‐	5,392	1,811	5,464	1,860
Reinsurers' share in payments and in changes in liabilities in respect of insurance contracts	‐	‐	‐	‐	(77)	(35)	(77)	(35)
Payments and change in liabilities in respect of insurance contracts and investment contracts - retention	71	49	‐	‐	5,315	1,776	5,386	1,825
Fees and commissions, marketing expenses and other purchase expenses	37	38	33	30	179	185	248	252
General and administrative expenses	36	33	58	47	94	83	188	163
Other expenses	2	2	1	1	‐	‐	3	3
Finance expenses	‐	‐	‐	‐	10	1	10	1
Total expenses	146	122	92	78	5,598	2,045	5,835	2,244
Share in results of equity-accounted investees, net	‐	‐	1	‐	‐	‐	1	‐
Profit (loss) before taxes on income	‐	5	12	19	(52)	57	(40)	81
Other comprehensive income (loss) before income tax	1	‐	1	(1)	14	42	16	41
Total comprehensive income (loss) before income tax	1	4	13	18	(38)	100	(24)	122
1) Total premiums (including pure savings premiums (investment contracts)) recognized directly in the reserve					1,523	1,684	1,523	1,684

	Health For the three month period ended September 30		Property and Casualty For the three month period ended September 30							Not allocated to		Adjustments and offsets	Total
					Credit cards For the three month period ended September 30		Other For the three month period ended September 30		segments For the three month period ended September 30		For the three month period ended September 30		For the three September 30	month period ended
	2024	2023	2024	2023	2024	2023	2024	2023	2024	2023	2024	2023	2024	2023
In NIS million							Unaudited
Premiums earned, gross	485	457	959	887	‐	‐	‐	‐	‐	‐	(1)	(1)	2,717	2,826
Premiums earned by reinsurers	31	25	347	365	‐	‐	‐	‐	‐	‐	‐	‐	461	434
Premiums earned - retention	454	432	612	521	‐	‐	‐	‐	‐	‐	(1)	(1)	2,256	2,391
Income from credit card transactions	‐	‐	‐	‐	416	393	‐	‐	‐	‐	‐	‐	416	393
Investment income, net and finance income	114	46	78	58	333	323	‐	1	120	(38)	10	30	4,926	981
Income from management fees	‐	‐	‐	‐	‐	‐	‐	‐	‐	‐	‐	‐	325	317
Finance income (expenses) from fees and commissions	4	3	54	56	5	‐	63	55	‐	‐	(20)	(26)	113	98
Other income	‐	‐	‐	‐	‐	1	‐	‐	1	‐	‐	‐	1	1
Total income	571	481	743	635	754	717	63	56	120	(38)	(11)	4	8,036	4,180
Payments and change in liabilities in respect of insurance
contracts and investment contracts, gross	373	327	736	443	‐	‐	‐	‐	‐	‐	(1)	(1)	6,572	2,630
Reinsurers' share in payments and in changes in liabilities
in respect of insurance contracts	(24)	(28)	(271)	(122)	‐	‐	‐	‐	‐	‐	‐	‐	(372)	(184)
Payments and change in liabilities in respect of insurance
contracts and investment contracts - retention	349	300	465	322	‐	‐	‐	‐	‐	‐	(1)	(1)	6,200	2,446
Credit loss expenses	‐	‐	‐	‐	62	86	‐	‐	‐	‐	‐	‐	62	86
Credit card processing	‐	‐	‐	‐	258	238	‐	‐	‐	‐	‐	‐	258	238
Payments to banks	‐	‐	‐	‐	61	59	‐	‐	‐	‐	‐	‐	61	59
Fees and commissions, marketing expenses and other
purchase expenses	175	165	187	167	120	109	42	39	‐	‐	(20)	(26)	752	706
General and administrative expenses	25	23	24	17	24	24	8	4	23	21	1	‐	293	252
Other expenses	‐	‐	‐	‐	‐	‐	2	2	1	‐	7	6	13	11
Finance expenses (income)	2	1	(2)	8	129	122	1	‐	78	79	‐	‐	216	212
Total expenses	550	488	674	514	654	638	52	45	101	100	(13)	(21)	7,854	4,010
Share in results of equity-accounted investees, net	‐	‐	‐	‐	3	1	3	2	1	‐	‐	‐	8	3
Profit (loss) before taxes on income	21	(8)	69	121	103	80	14	13	20	(138)	2	24	189	173
Other comprehensive income (loss) before income tax	11	(8)	4	6	‐	‐	‐	‐	190	5	‐	‐	221	44
Total comprehensive income (loss)
before income tax	32	(15)	74	126	103	80	14	13	209	(133)	2	24	410	217

33 - 2

	Liability Subsegments
	Compulsory motor insurance		Liability and Other Subsegments 1)
	For the nine month ended September 30	period	For the year ended December 31	For the nine month period ended September 30		For the year ended December 31
	2024	2023	2023	2024	2023	2023
In NIS million	Unaudited		Audited	Unaudited		Audited
Gross premiums	621	565	704	371	411	506
Reinsurance premiums	104	135	168	180	218	258
Premiums - retention	517	431	536	191	193	248
Change in unearned premium balance, retention	(75)	(73)	(43)	(6)	(12)	(8)
Premiums earned - retention	443	358	493	185	181	240
Investment income, net and finance income	88	63	87	66	58	78
Income from fees and commissions	10	18	23	16	17	23
Total revenues	541	440	602	267	256	342
Payments and change in liabilities in respect of insurance contracts and investment contracts, gross	473	436	637	159	154	104
Reinsurers' share in payments and in changes in liabilities in respect of insurance contracts	(104)	(133)	(187)	(82)	(63)	20
Payments and change in liabilities in respect of insurance contracts and investment contracts - retention	369	303	450	77	92	125
Fees and commissions, marketing expenses and other purchase expenses	74	73	100	71	76	104
General and administrative expenses	11	10	18	5	5	9
Finance expenses	3	3	4	‐	5	4
Total expenses	458	388	572	153	178	242
Share in results of equity-accounted investees, net	(1)	‐	‐	(1)	‐	‐
Income before income tax	82	51	30	113	78	100
Other comprehensive income before income tax	6	16	19	1	13	16
Total comprehensive income before income tax	88	67	50	114	92	117

	Liability Subsegments
	Compulsory motor insurance	Liability and Other Subsegments 1)
	As of September 30		As of December 31	As of September 30		As of December 31
Liabilities in respect of insurance contracts	2024	2023	2023	2024	2023	2023
In NIS million	Unaudited		Audited	Unaudited		Audited
Gross	2,848	2,930	2,967	2,311	2,916	2,289
Reinsurance	1,014	1,243	1,236	1,010	1,577	959
Retention	1,834	1,687	1,731	1,301	1,339	1,329

1) Other liability subsegments mainly include results from the third-party liability, officers liability and employers liability insurance subsegments, the activity of which in the reporting period, the corresponding period last year and the year ended December 31, 2023 constitutes approx. 83%, approx. 80% and approx. 80% of total premiums in these subsegments, respectively.

35 - 2

	Property Subsegments
		Motor Property			Credit insurance			Property and Other Segment 1)	Total
	For the nine-month period ended September 30		For the year ended December 31	For the nine-month period ended September 30		For the year ended December 31	For the nine-month period ended September 30		For the year ended December 31	For the nine-month period ended September 30		For the year ended December 31
	2024	2023	2023	2024	2023	2023	2024	2023	2023	2024	2023	2023
In NIS million	Unaudited		Audited	Unaudited		Audited	Unaudited		Audited	Unaudited		Audited
Gross premiums	1,074	877	1,101	105	102	133	984	904	1,152	3,154	2,859	3,596
Reinsurance premiums	11	50	59	55	53	69	777	706	899	1,127	1,161	1,452
Premiums - retention	1,063	827	1,042	49	49	64	207	199	253	2,027	1,698	2,143
Change in unearned premium balance, retention	(171)	(137)	(94)	(1)	(2)	(2)	(17)	(18)	(12)	(269)	(242)	(159)
Premiums earned - retention	892	690	948	49	46	62	190	180	241	1,758	1,456	1,984
Investment income, net and finance income	37	21	27	13	8	8	15	20	28	220	170	227
Income from fees and commissions	2	6	7	14	14	20	117	110	149	160	166	222
Total revenues	931	716	982	76	69	90	323	311	418	2,138	1,792	2,434
Payments and change in liabilities in respect of insurance contracts and investment contracts, gross	633	668	857	37	34	44	361	124	182	1,664	1,417	1,825
Reinsurers' share in payments and in changes in liabilities in respect of insurance contracts	(16)	(78)	(89)	(25)	(23)	(30)	(313)	(118)	(160)	(540)	(415)	(446)
Payments and change in liabilities in respect of insurance contracts and investment contracts - retention	618	590	768	12	11	14	49	6	22	1,125	1,002	1,379
Fees and commissions, marketing expenses and other purchase expenses	212	179	249	10	9	13	147	152	210	514	490	675
General and administrative expenses	20	15	27	17	16	22	16	13	25	70	60	102
Finance expenses	‐	1	‐	1	3	1	2	9	9	6	21	18
Total expenses	850	786	1,045	40	39	51	213	181	265	1,714	1,573	2,174
Share in results of equity-accounted investees, net	‐	‐	‐	‐	‐	‐	‐	‐	‐	(2)	‐	‐
Income (loss) before income tax	81	(69)	(62)	36	29	39	110	129	152	422	219	259
Other comprehensive income before income tax	‐	5	6	1	1	6	‐	3	4	8	39	53
Total comprehensive income (loss) before income tax	81	(64)	(56)	38	30	45	110	133	156	431	258	312

			As of			As of			As of			As of
	As of September 30		December 31 As of September 30			December 31 As of September 30			December 31 As of September 30			December 31
Liabilities in respect of insurance contracts	2024	2023	2023	2024	2023	2023	2024	2023	2023	2024	2023	2023
In NIS million	Unaudited		Audited	Unaudited		Audited Unaudited		Audited	Unaudited		Audited
Gross	988	871	790	98	90	93	1,432	1,359	1,244	7,678	8,165	7,383
Reinsurance	27	73	58	55	49	51	1,174	1,103	995	3,281	4,044	3,299
Retention	961	798	732	43	41	42	258	256	249	4,397	4,121	4,084

1) Property and other subsegments mainly include results from the business, home and engineering property insurance subsegments, the activity of which in the reporting period, the corresponding period last year and the year ended December 31, 2023 constitutes approx. 79%, approx. 77% and approx. 77% of total premiums in these subsegments, respectively.

37 - 2

		Liability Subsegments	Property Subsegments
	Compulsory motor insurance	Liability and Other Subsegments 2)		Motor Property		Credit insurance		Property and Other Segment 1)		Total
	For the three-month period ended September 30		For the three-month period ended September 30		For the three-month period ended September 30		For the three-month period ended September 30		For the three-month period ended September 30		For the three-month period ended September 30
	2024	2023	2024	2023	2024	2023	2024	2023	2024	2023	2024	2023
In NIS million						Unaudited
Gross premiums	226	205	99	110	369	324	36	34	278	281	1,008	954
Reinsurance premiums	42	50	44	47	2	15	19	18	210	216	317	346
Premiums - retention	183	155	56	62	367	309	17	16	68	65	691	608
Change in unearned premium balance, retention	(31)	(28)	6	1	(51)	(58)	‐	‐	(4)	(1)	(80)	(87)
Premiums earned - retention	152	127	62	63	317	251	17	16	64	64	612	521
Investment income, net and finance income	31	18	22	19	14	6	5	4	6	11	78	58
Income from fees and commissions	3	5	5	6	‐	1	5	5	40	38	54	56
Total revenues	186	151	89	88	331	259	27	24	110	114	743	635
Payments and change in liabilities in respect of insurance contracts and investment contracts, gross	202	153	131	72	223	208	10	16	171	(6)	736	443
Reinsurers' share in payments and in changes in liabilities in respect of insurance contracts	(50)	(49)	(59)	(25)	(5)	(18)	(6)	(11)	(150)	(19)	(271)	(122)
Payments and change in liabilities in respect of insurance contracts and investment contracts - retention	151	104	72	47	218	190	3	5	20	(24)	465	322
Fees and commissions, marketing expenses and other purchase expenses	26	23	28	28	78	62	3	3	52	51	187	167
General and administrative expenses	4	3	1	1	7	4	6	6	5	4	24	17
Finance expenses (income)	1	(4)	(1)	4	‐	‐	‐	1	(2)	7	(2)	8
Total expenses	183	126	100	80	303	255	13	15	76	38	674	514
Income (loss) before income tax	3	25	(11)	7	28	3	14	9	34	76	69	121
Other comprehensive income (loss) before income tax	‐	3	‐	2	‐	1	4	(2)	‐	1	4	6
Total comprehensive income (loss) before income tax	3	28	(11)	10	28	5	19	7	34	77	74	126

1) Property and Other Subsegments mainly include results from the business, home and engineering Property Insurance Subsegments, the activity of which in the three-month period ended on the report date and in the corresponding period last year constitutes approx. 71%, 76%, respectively, of total premiums in these subsegments.

2) Other liability subsegments mainly include results from the third-party liability, employers' liability and executive liability and professional liability insurance subsegments, the activity of which in the threemonth period ended on the report date and in the corresponding period last year constitute approx. 87% and approx. 86% of total premiums in these subsegments, respectively.

E. Additional data about the Life Insurance and Long-Term Savings Segments

Data for the nine-month period ended September 30, 2024 (unaudited)

		Life insurance policies including a savings component (including appendices) by policy	issuance date	Life insurance policy without a risk savings component sold as a
				From 2004		single policy
In NIS million	Until 1990 1)	Until 2003	Non-yield dependent	Yield	dependent Individual Collective		Total
Gross premiums:	92	1,129	‐	1,913	682	50	3,866
Proceeds in respect of investment contracts credited directly to insurance reserves		‐ ‐	‐	590	‐	‐	590
Financial margin including management fees 2)	80	198	‐	245	‐	‐	523
Payments and change in liabilities in respect of insurance contracts, gross	1,400	5,614	‐	4,357	421	46	11,839
Payments and change in liabilities for investment contracts		‐ ‐	‐	796	‐	‐	796
Total comprehensive income (loss)	59	(56)	-	(105)	(10)	5	(107)

Data for the nine-month period ended September 30, 2023 (unaudited)

		Life insurance policies including a savings component (including appendices) by policy	issuance date	Life insurance policy without a risk savings component sold as a
In NIS million				From 2004	single policy
	Until 1990 1)	Until 2003	Non-yield dependent	Yield	dependent Individual Collective		Total
Gross premiums:	105	1,186	‐	2,697	638	55	4,681
Proceeds in respect of investment contracts credited directly to
insurance reserves		‐ ‐	‐	933	‐	‐	933
Financial margin including management fees 2)	30	189	‐	255	‐	‐	474
Payments and change in liabilities in respect of insurance contracts, gross	1,285	3,083	‐	3,893	350	46	8,656
Payments and change in liabilities for investment contracts		‐ ‐	‐	452	‐	‐	452
Total comprehensive income (loss)	36	140	(* -	(88)	(* 11	5	105

Data for the three-month period ended September 30, 2024 (unaudited)

	Life insurance policies including a savings component (including appendices) by policy issuance date				Life insurance policy without a risk savings component sold as a
In NIS million			From 2004		single policy
	Until 1990 1)	Until 2003	Non-yield dependent	Yield	dependent Individual Collective		Total
Gross premiums:	30	373	-	622	232	17	1,274
Proceeds in respect of investment contracts credited directly to insurance reserves		‐ ‐	‐	249	‐	‐	249
Financial margin including management fees 2)	30	66	-	81	‐	‐	177
Payments and change in liabilities in respect of insurance contracts, gross	595	2,494	-	1,801	159	13	5,062
Payments and change in liabilities for investment contracts		‐ ‐	‐	331	‐	‐	331
Total comprehensive income (loss)	(13)	20	-	(35)	(16)	7	(38)

Data for the three-month period ended September 30, 2023 (unaudited)

		Life insurance policies including a savings component (including appendices) by policy	issuance date	Life insurance policy without a risk savings component sold as a
				From 2004	single policy
In NIS million	Until 1990 1)	Until 2003	Non-yield dependent	Yield	dependent Individual Collective		Total
Gross premiums:	35	391	‐	820	218	19	1,483
Proceeds in respect of investment contracts credited directly to insurance reserves	‐	‐	‐	201	‐	‐	201
Financial margin including management fees 2)	(55)	64	‐	84	‐	‐	93
Payments and change in liabilities in respect of insurance contracts, gross	380	395	‐	829	118	15	1,738
Payments and change in liabilities for investment contracts	‐	‐	‐	73	‐	‐	73
Total comprehensive income (loss)	(64)	199	‐	(33)	(3)	‐	100

Data for the year ended December 31, 2023 (audited)

		Life insurance policies including a savings component (including appendices) by policy	issuance date	Life insurance policy without a risk savings component sold as a single policy
		Until 2003	From 2004
In NIS million	Until 1990 1)		Non-yield dependent	Yield	dependent Individual Collective		Total
Gross premiums:	138	1,568	‐	3,398	857	80	6,041
Proceeds in respect of investment contracts credited directly to insurance reserves	‐	‐	‐	1,081	‐	‐	1,081
Financial margin including management fees 2)	65	253	‐	340	‐	‐	658
Payments and change in liabilities in respect of insurance contracts, gross	1,510	4,492	‐	5,387	529	77	11,995
Payments and change in liabilities for investment contracts	‐	‐	‐	684	‐	‐	684
Total comprehensive income (loss)	92	304	(* -	(134)	(*(35)	(2)	225

Comments:

*) Reclassified.

(1) Products issued until 1990 (including increases in respect thereof) were mainly guaranteed return policies that were backed mainly by designated bonds.

(2) The financial margin comprises investment income (losses) recognized in other comprehensive income, excludes other income of the Company, which are collected as a percentage of the premium, and calculated before the deduction of investment management expenses. The financial margin in guaranteed return policies is based on actual investment income, for the reporting year, less the product of the annual guaranteed rate of return, multiplied by the average reserve per year in the various insurance reserves. In yield-dependent contracts, the financial margin is composed of the total amount of the fixed and variable management fees calculated as a reduction of the amounts credited to the savings balances in the Company's systems.

F. Additional data regarding the Health Insurance Subsegments

Data for the nine-month period ended September 30, 2024 (unaudited)

	LTC		Health - other **)
In NIS million	Individual Collective		Long-term Short-term Total
Gross premiums	208	17	(*1,055	(*101	1,381
Payments and changes in liabilities in respect of insurance contracts, gross	341	32	529	68	970
Other comprehensive income	-	-	15	1	16
Total comprehensive income (loss)	61	(2)	62	(1)	120

*) Of which, individual premiums in the amount of NIS 1,034 million and collective premiums in the amount of NIS 122 million.

**) The most substantial coverage included in other long-term health is medical expenses and in short-term health insurance - travel.

Data for the nine-month period ended September 30, 2023 (unaudited)

	LTC		Health - other **)
In NIS million	Individual Collective			Long-term Short-term Total
Gross premiums	209	17	(*952	(*130	1,308
Payments and changes in liabilities in respect of insurance contracts, gross	313	39	520	82	954
Other comprehensive income	-	-	1	-	1
Total comprehensive income (loss)	(2)	(7)	(4)	10	(3)

*) Of which, individual premiums in the amount of NIS 917 million and collective premiums in the amount of NIS 165 million.

**) The most substantial coverage included in other long-term health is medical expenses and in short-term health insurance - travel.

Data for the three-month period ended September 30, 2024 (unaudited)

	LTC		Health - other **)
In NIS million	Individual Collective		Long-term Short-term Total
Gross premiums	69	7	(*362	(*49	487
Payments and changes in liabilities in respect of insurance contracts, gross	148	11	186	27	372
Other comprehensive income	-	-	9	1	10
Total comprehensive income	4	-	20	9	32

*) Of which, individual premiums in the amount of NIS 379 million and collective premiums in the amount of NIS 32 million.

**) The most substantial coverage included in other long-term health is medical expenses and in short-term health insurance - travel.

Data for the three-month period ended September 30, 2023 (unaudited)

	LTC		Health - other **)
In NIS million	Individual Collective			Long-term Short-term Total
Gross premiums	70		(*322 6	(*58	456
Payments and changes in liabilities in respect of insurance contracts, gross	91		21 184	31	327
Other comprehensive loss		-	- (7)	-	(7)
Total comprehensive income (loss)		4 (11)	(20)	12	(15)

*) Of which, individual premiums in the amount of NIS 316 million and collective premiums in the amount of NIS 64 million.

**) The most substantial coverage included in other long-term health is medical expenses and in short-term health insurance - travel.

Data for the year ended December 31, 2023 (audited)

	LTC		Health - other **)
In NIS million	Individual Collective			Long-term Short-term Total
Gross premiums	278	23	(*1,278	(*152	1,731
Payments and changes in liabilities in respect of insurance contracts, gross	524	64	655	105	1,348
Other comprehensive income (loss)	-		- (12)	1	(11)
Total comprehensive income (loss)	(105)	(25)	53	-	(77)

*) Of which, individual premiums in the amount of NIS 1,225 million and collective premiums in the amount of NIS 205 million.

**) The most substantial coverage included in other long-term health is medical expenses and in short-term health insurance - travel.

NOTE 5 – SUBSIDIARIES

A business combination which took place in 2023 and was measured in previous periods at provisional amounts (acquisition of CIMax Holdings Ltd. (formerly WPI))

As described in Note 9, Investments in Investees, in the Consolidated Financial Statements for 2023, on March 27, 2023 the Company completed the acquisition of the entire issued and paid-up share capital of CIMax Holdings Ltd.

The Group's financial statements as of March 31, 2023, June 30, 2023, September 30, 2023, and December 31, 2023 included provisional amounts in respect of identified assets and liabilities of CIMax Group that were acquired. Upon completion of the independent valuation for the business combination, the amounts were revised as follows:

Identifiable assets and liabilities acquired:

	Balance as of March 31, 2023 - based on	Effect of the change in estimate following completion of	As reported in these financial
In NIS million Cash and cash equivalents	provisional values 496	the valuation	statements ‐ 496

Receivables and debit balances	52		‐ 52
Receivables for credit card transactions, net	15,432		- 15,432
Excess cost on acquisition *)	281	(66)	215
Intangible assets	255		- 255
Property, plant & equipment	131		- 131
Right-of-use asset	198		‐ 198
Deferred tax assets	30		- 30
Investments in equity-accounted investees	7		‐ 7
Other financial investments	3		‐ 3
Payables and credit balances	(463)		‐ (463)
Payables for credit card transactions	(8,649)		‐ (8,649)
Financial liabilities	(6,535)		‐ (6,535)
Liability for employee benefits, net	(27)		‐ (27)
Lease liability	(198)		‐ (198)
Current tax liabilities	(21)		‐ (21)
Net identifiable assets	992	(66)	926

*) Composition of excess cost

In NIS million	Amortization period (in years)	Balance as of March 31, 2023 - based on provisional values	Effect of the change in estimate following completion of the valuation	As reported in these financial statements
Brand	10	73	1	74
Technology	8.75	60	(20)	40
Customer relations	6.75-7.75	188	(47)	141
Payables and credit balances	0.25	(13)	‐	(13)
Financial liabilities	1	(28)	-	(28)
Total		281	(66)	215

Goodwill

Due to the acquisition, goodwill was recognized as detailed below:

In NIS million	Balance as of March 31, 2023 - based on provisional values	Effect of the change in estimate following completion of the valuation	As reported in these financial statements
Consideration paid	1,420	-	1,420
Less fair value of the identifiable assets, net	(992)	66	(926)
Total goodwill	428	66	494

In accordance with the provisions of Topic 805 to the Accounting Standards Codification, the financial statements were not adjusted retrospectively in respect of adjustments, which took place during the measurement period; rather, all adjustments to provisional amounts recognized in previous periods during the measurement period were recognized in the current reporting period in which the valuation was completed.

The effect on the profit and loss statement and other comprehensive income, which would have been recognized during the period from March 31, 2023 to December 31, 2023, and which was effectively recognized during the first quarter of 2024 had the final valuation been completed on acquisition date, is immaterial.

NOTE 6 – FINANCIAL INSTRUMENTS

A. Assets for yield-dependent contracts

1. Composition:

	As of September 30	As of December 31
	2024	2023	2023
In NIS million	Unaudited		Audited
Investment property 1)	3,892	3,842	3,839
Financial investments
Liquid debt assets	26,496	28,808	28,065
Illiquid debt assets	7,634	8,568	8,199
Shares	19,099	17,562	17,378
Other financial investments	33,313	27,928	30,491
Total financial investments 1)	86,542	82,866	84,133
Cash and cash equivalents	5,011	4,552	4,418
Other 2)	1,393	2,879	1,622
Total assets for yield-dependent contracts	96,838	94,139	94,012

1) Measured at fair value through profit and loss.

2) The balance includes mainly collectible premiums, reinsurer balances, collateral for activity in forward contracts and outstanding securities transactions as of the date of the financial statements.

2. Additional information on fair value

A. Fair value of financial assets by level

		As of September 30, 2024
	Level 1	Level 2	Level 3	Total
In NIS million		Unaudited
Financial investments:
Liquid debt assets	22,140	4,356		‐ 26,496
Illiquid debt assets		‐ 7,626		8 7,634
Shares	16,400	371	2,328	19,099
Other financial investments 1)	16,562	2,564	14,187	33,313
Total financial investments	55,102	14,917	16,523	86,542
1) Of which for derivatives	191	636		7 834

During the period there were no material transfers between Level 1 and Level 2. In addition, there were no transitions from or to Level 3.

		Balance as of September 30, 2023
	Level 1	Level 2	Level 3	Total
In NIS million		Unaudited
Financial investments:
Liquid debt assets	24,202	4,606	‐	28,808
Illiquid debt assets	‐	8,539	29	8,568
Shares	15,133	477	1,952	17,562
Other financial investments 1)	14,244	1,264	12,420	27,928
Total financial investments	53,579	14,886	14,401	82,866
1) Of which for derivatives	280	284	9	573

During the period there were no material transfers between Level 1 and Level 2. In addition, there were no transitions from or to Level 3.

		Balance as of December 31, 2023
	Level 1	Level 2	Level 3	Total
In NIS million		Audited
Financial investments:
Liquid debt assets	23,410	4,655	‐	28,065
Illiquid debt assets	‐	8,170	29	8,199
Shares	14,899	511	1,968	17,378
Other financial investments 1)	16,002	1,950	12,539	30,491
Total financial investments	54,311	15,286	14,536	84,133
1) Of which for derivatives	280	284	9	573

During the period there were no material transfers between Level 1 and Level 2. In addition, there were no transitions from or to Level 3.

B. Financial assets measured at fair value - Level 3

	Illiquid debt assets	Shares		Other financial investments	Total
In NIS million	Unaudited
Balance as of January 1, 2024 (audited)	29		1,968	12,539	14,536
Total gains (losses) recognized in profit and loss		6	(27)	812	791
Purchases		‐	397	1,880	2,277
Sales		‐	(6)	(1,040)	(1,046)
Redemptions	(24)		‐	‐	(24)
Proceeds from interest and dividend	(3)		(4)	(4)	(11)
Balance as of September 30, 2024		8	2,328	14,187	16,523
Total income (losses) for the period included in profit and loss in respect of financial assets held as of September 30, 2024		1	(27)	814	788

	Illiquid debt assets		Shares	Other financial investmentsTotal
In NIS million	Unaudited
Balance as of January 1, 2023 (audited)		61	2,106	10,027	12,194
Total gains (losses) recognized in profit and loss		4	(20)	1,009	993
Purchases		‐	239	2,062	2,301
Sales		‐	(370)	(689)	(1,059)
Redemptions		(12)	‐	‐	(12)
Proceeds from interest and dividend		(13)	(3)	‐	(16)
Debt-to-equity swap		(11)	‐	11	‐
Balance as of September 30, 2023		29	1,952	12,420	14,401
Total income (losses) for the period included in profit and loss in respect of financial assets held as of September 30, 2023		5	(22)	1,032	1,015

	Illiquid debt assets	Shares		Other financial invest ments	Total
In NIS million Balance as of July 1, 2024		28	Unaudited 2,292	13,790	16,110
Total gains recognized in profit and loss		6	37	138	181
Purchases		‐	(1)	695	694
Sales		‐	‐	(434)	(434)
Redemptions	(23)		‐		‐ (23)
Proceeds from interest and dividend		(3)	‐	(2)	(5)
Balance as of September 30, 2024		8	2,328	14,187	16,523
Total income (losses) for the period included in profit and loss in
respect of financial assets held as of September 30, 2024		1	37	138	176

	Shares		Other financial invest ments	Total
In NIS thousand		Unaudited
Balance as of July 1, 2023	41	1,952	11,569	13,562
Total gains (losses) recognized in profit and loss	(1)	11	371	381
Purchases	‐	6	758	764
Sales	‐	(17)	(289)	(306)
Debt-to-equity swap	(11)	‐	11	‐
Balance as of September 30, 2023	29	1,952	12,420	14,401
Total income (losses) for the period included in profit and loss in respect of financial assets held as of September 30, 2023	‐	11	394	405

	Illiquid debt assets	Shares		Other financial invest ments	Total
In NIS thousand			Audited
Balance as of January 1, 2023 (audited)		61	2,106	10,027	12,194
Total gains (losses) recognized in profit and loss		4	(161)	517	360
Purchases		‐	393	2,989	3,382
Sales		‐	(367)	(1,005)	(1,372)
Redemptions	(12)		‐	‐	(12)
Proceeds from interest and dividend	(13)		(3)	‐	(16)
Debt-to-equity swap	(11)		‐	11	‐
Balance as of December 31, 2023 (audited)		29	1,968	12,539	14,536
Total gains (losses) for the period included in profit and loss in respect of financial assets held as of December 31, 2023 (audited)		4	(163)	540	381

B. Other financial investments

1. Illiquid debt assets - composition and fair value 1)

	As of September 30, 2024
	Carrying value	Fair value
In NIS million	Unaudited
Government bonds
Hetz bonds and treasury deposits	17,211	21,840
Other non-convertible debt assets	7,968	8,050
Deposits with banks	427	436
Total illiquid debt assets	25,606	30,326
Impairments carried to profit and loss (cumulative)	35

	As of September 30, 2023
	Carrying value	Fair value
In NIS million	Unaudited
Government bonds
Hetz bonds and treasury deposits	16,800	22,694
Other non-convertible debt assets	7,042	7,021
Deposits with banks	583	593
Total illiquid debt assets	24,425	30,308
Impairments carried to profit and loss (cumulative)	45

	As of December 31, 2023
	Carrying value	Fair value
In NIS million	Audited
Government bonds
Hetz bonds and treasury deposits	16,634	22,279
Other non-convertible debt assets	7,260	7,270
Deposits with banks	550	566
Total illiquid debt assets	24,444	30,115
Impairments carried to profit and loss (cumulative)	42

1) The fair value of designated bonds was calculated in accordance with the repayment date of guaranteed return liabilities. The fair value of treasury deposits was calculated in accordance with the contractual repayment date.

2. Additional information on fair value

A. Fair value of financial assets by level

The following table presents an analysis of financial assets 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 Annual Financial Statements.

		As of September 30, 2024
	Level 1	Level 2	Level 3	Total
In NIS million	Unaudited
Financial investments:
Liquid debt assets	5,934	148		‐ 6,082
Illiquid debt assets		‐	‐	‐ ‐
Shares	923		30 830	1,783
Other financial investments 1)	944	219	5,061	6,224
Total financial investments	7,801	397	5,891	14,089
1) Of which for derivatives		2 219		3 224

During the period there were no material transfers between Level 1 and Level 2. In addition, there were no transitions from or to Level 3.

	Balance as of September 30, 2023
	Level 1	Level 2	Level 3	Total
In NIS million	Unaudited
Financial investments:
Liquid debt assets	6,337	150		‐ 6,487
Illiquid debt assets		‐	1	‐ 1
Shares	829		53 827	1,709
Other financial investments 1)	619		41 4,542	5,202
Total financial investments	7,785	245	5,369	13,399
1) Of which for derivatives	13		43	4 60

During the period there were no material transfers between Level 1 and Level 2. In addition, there were no transitions from or to Level 3.

		Balance as of December 31, 2023
	Level 1	Level 2	Level 3	Total
In NIS million		Audited
Financial investments:
Liquid debt assets	7,130	183		‐ 7,313
Illiquid debt assets		‐	‐	‐ ‐
Shares	867		47 757	1,671
Other financial investments 1)	1,007	301	4,528	5,836
Total financial investments	9,004	531	5,285	14,820
1) Of which for derivatives		4 301		3 308

During the period there were no material transfers between Level 1 and Level 2. In addition, there were no transitions from or to Level 3.

B. Financial assets measured at fair value - Level 3

	Shares		Other financial invest ments	Total
In NIS million		Unaudited
Balance as of January 1, 2024 (audited)	757		4,528	5,285
Total income (losses) recognized:
In profit and loss	(21)		60	39
In other comprehensive income		40	224	264
Purchases		82	571	653
Sales	(23)		(322)	(345)
Proceeds from interest and dividend	(5)		‐	(5)
Balance as of September 30, 2024	830		5,061	5,891
Total income (losses) for the period included in profit and loss in respect of
financial assets held as of September 30, 2024	(21)		63	42

	Shares	Other financial invest ments	Total
In NIS million		Unaudited
Balance as of January 1, 2023 (audited)	937	3,697	4,634
Total income (losses) recognized:
In profit and loss	109	75	184
In other comprehensive income	(124)	344	220
Purchases	101	708	809
Sales	(191)	(282)	(473)
Proceeds from interest and dividend	(5)		‐ (5)
Balance as of September 30, 2023	827	4,542	5,369
Total income (losses) for the period included in profit and loss in respect of financial assets held as of September 30, 2023	77	79	156

	Shares	Other financial invest ments	Total
In NIS million		Unaudited
Balance as of July 1, 2024	831	4,937	5,768
Total income (losses) recognized:
In profit and loss	(2)		52 50
In other comprehensive income		2	30 32
Purchases	19	175	194
Sales	(19)	(133)	(152)
Proceeds from interest and dividend	(1)		‐ (1)
As of September 30, 2024	830	5,061	5,891
Total income (losses) for the period included in profit and loss in respect of
financial assets held as of September 30, 2024	(2)		56 54

	Shares	Other financial invest ments	Total
In NIS million		Unaudited
Balance as of July 1, 2023	853	4,261	5,114
Total income (losses) recognized:
In profit and loss	(45)	32	(13)
In other comprehensive income	(1)	118	117
Purchases	27	245	272
Sales	(6)	(114)	(120)
Proceeds from interest and dividend	(1)		‐ (1)
Balance as of September 30, 2023	827	4,542	5,369
Total income (losses) for the period included in profit and loss in respect of
financial assets held as of September 30, 2023	(45)	36	(9)

	Shares	Other financial invest ments	Total
In NIS million		Audited
Balance as of January 1, 2023 (audited)	937	3,697	4,634
Total income (losses) recognized:
In profit and loss	41	96	137
In other comprehensive income	(142)	134	(8)
Purchases	117	944	1,061
Sales	(190)	(343)	(533)
Proceeds from interest and dividend	(6)		‐ (6)
Balance as of December 31, 2023 (audited)	757	4,528	5,285
Total gains for the period included in profit and loss in respect of financial assets held as of December 31, 2023 (audited)	9	97	106

C. Receivables for credit card transactions - for Max

	September 30, 2024
	On	Fair value
	balance sheet Level 1 balances	Level 2	Level 3	Total
In NIS million		Unaudited
Receivables for credit card transactions	17,287	‐	‐ 17,212	17,212

	September 30, 2023
	On balance sheet balances	Fair value
		Level 1	Level 2	Level 3		Total
In NIS million			Unaudited
Receivables for credit card transactions	15,688		‐	‐	15,610	15,610

		December 31, 2023
	On		Fair value
	balance sheet balances	Level 1	Level 2	Level 3		Total
In NIS million			Audited
Receivables for credit card transactions	15,078		‐	‐	15,012	15,012

C. Financial liabilities

1. Composition of fair value:

		As of September 30			As of September 30	As of December 31
			2024		2023		2023
		Carrying value	Fair value	Carrying value	Fair value	Carrying value	Fair value
In NIS million	Comment			Unaudited			Audited
Financial liabilities presented at fair value through profit and loss:
Liability for derivative financial instruments, short sale and
repo liabilities *)		2,042	2,042	3,548	3,548	2,929	2,929
Financial liabilities presented at amortized cost:
The Company:
Bonds (Series A) - Liquid bonds	A	908	903	906	904	918	942
Bonds (Series B) - Liquid convertible
bonds - Par value component	A	143	134	140	135	142	133
Bonds (Series C) - Liquid bonds	A	507	502		‐ ‐	497	508
Subsidiaries:
Loans in CIMax and its subsidiaries,
excluding Max	B	13	13	885	885	889	889
Liquid subordinated notes in Clal
Insurance	C	4,623	4,170	4,930	4,459	4,639	4,315
Credit from banking corporations
in Max		5,607	5,607	5,339	5,339	5,202	5,202
Bonds and subordinated notes in Max	D	793	797	736	708	582	581
Total financial liabilities presented at amortized cost		12,594	12,125	12,936	12,430	12,869	12,569
Less interest payable in respect of bonds and subordinated notes presented in payables and credit
balances line item		75	75	103	103	99	99
Total financial liabilities		14,561	14,092	16,382	15,875	15,699	15,400
*) Of which in respect of yield
dependent liabilities		1,647	1,647	2,639	2,639	1,786	1,786

A. Bonds issued by the Company

On February 28, 2024, interest was paid on Bonds (Series A) and Bonds (Series B) totaling approx. NIS 48 million, and in May 1, 2024 interest was paid on Bonds (Series C) totaling approx. NIS 11 million, in accordance with the terms and conditions of the notes.

B. CIMax - syndicated loan

Further to Note 26(a1)(3) to the Consolidated Financial Statements for 2023, on February 25, 2024, CIMax executed early repayment of the full amount of the syndicated loan.

C. Debt raising in Clalbit Finance Ltd. a subsidiary of Clal Insurance (hereinafter - "Clalbit Finance")

On January 7, 2024, approx. NIS 504 million p.v. in Notes (Series J) were exchanged by way of an exchange tender offer in consideration for the issuance of approx. NIS 508 million p.v. in Notes (Series L) in circulation, traded on the TASE, by way of expansion of an existing series. The Notes (Series M), that were issued as stated above, were recognized (subject to restrictions) as Tier 2 capital of Clal Insurance, instead of Notes (Series F), that were exchanged, and which were recognized as hybrid Tier 2 capital.

The terms of some of the Notes (Series J) vary from the terms of the Notes (Series M), and accordingly they were accounted for as replacement of debt instruments with materially different terms; accordingly, Clal Insurance accrued a loss of approx. NIS 1.6 million.

The issuance costs amounted to approx. NIS 1.5 million.

On April 3, 2024, Clalbit Finance issued to the public NIS 465 million p.v. in Notes (Series M) by way of expansion of an existing series in consideration for approx. NIS 460 million. The terms and conditions of the additional notes are identical to the terms and conditions of the Notes (Series M) in circulation. The issuance costs amounted to approx. NIS 5.1 million.

The total consideration (gross), received by Clalbit Finance following issuance of the new bonds under the said issuance, was deposited in Clal Insurance as 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 (subject to limitations) and bear equal status and seniority level as the subordinated bonds issued by Clal Insurance that are classified as 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 Clalbit Finance 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.

On July 31, 2024, Clalbit Finance executed early redemption of the outstanding balance of the Notes (Series J), in accordance with their terms and conditions.

D. 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 September 30, 2024 includes Subordinated Notes (Series D) with a contractual loss absorption mechanism totaling NIS 250 million in par value, which are recognized as Tier 2 capital as from their issuance date on July 16, 2023, and as from the completion of a private placement - on January 4, 2024 - of a commercial security to institutional investors totaling NIS 230 million.

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 the Bonds and Subordinated Notes as a result of the abovementioned issuances was partially offset against early redemptions carried out by Max:

On November 16, 2023, Max's board of directors resolved to perform full early redemption of Subordinated Notes (Series B) in the amount of approx. NIS 139 million issued in December 2018, which were included in Max's Tier 2 capital; on March 11, 2024, the Board of Directors of Max resolved to perform full early redemption of a subordinated note in the amount of NIS 35 million issued in March 2019, as part of a private placement, which was included in Max's Tier 2 capital. The early redemption in full of the Subordinated Notes (Series B) was executed on December 31, 2023, and the early redemption in full of the Note issued in a private placement in March 2019 was executed on March 31, 2024.

E. Binding credit facilities

1. Credit facility for Clal Holdings

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. If credit is provided out of the credit facility, the terms and conditions will be as detailed below:

Credit period	Up to 12 months
Non-utilization fee	0.25%
Annual interest rate	P-1% -P-0.5%
Date of principal repayment	At the credit's final repayment date
Total interest repayment dates	Quarterly payment
Linkage mechanism	Non-linked
Pledged assets	Collateral-free, but the Company undertook not to create a general floating charge on its assets
Restrictions applicable to the Company in connection with the credit facility	Whenever the credit facility is utilized - the Company's accounts at the bank will contain an amount of at least NIS 50 million (fifty million NIS) in liquid assets, as defined, and if the Company distributes dividends in that period, an amount of up to 50% of the dividend will be added to the above amount.
Material terms for utilization of credit facility	Standard commercial terms, including the absence of cause for calling for immediate repayment of the Company's debts to the bank

If credit is provided out of the credit facility, the terms for calling for immediate repayment will apply thereto, including a cross-default mechanism.

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

On June 4, 2024, Max signed the renewal of an agreement for credit facilities from a banking corporation totaling NIS 2,100 million with no material change in conditions compared to the existing credit facilities. This credit facility is effective until June 3, 2025. This facility includes short-term credit at interest rates based on Prime plus a margin in the range of Prime minus 0.5% to Prime minus 1.5%. In addition, the credit facilities include a non-utilization fee at a rate in the range of 0.1%-0.7%. The bank will be entitled to call for the immediate repayment of all or part of the credit amounts, under the terms and conditions set forth.

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 2023.

		As of September 30, 2024
	Level 1	Level 2	Total
In NIS million	Unaudited
Derivatives	66	758	824
Liability for Repo		‐ 1,218	1,218
Total financial liabilities	66	1,976	2,042

	As of September 30, 2023
	Level 1 Level 2 Total
In NIS million	Unaudited
Derivatives	81 2,525 2,606
Liability for Repo	‐ 942 942
Total financial liabilities	81 3,467 3,548

	As of December 31, 2023
	Level 1 Level 2 Total
In NIS million	Audited
Derivatives	10 1,772 1,782
Liability for Repo	‐ 1,147 1,147
Total financial liabilities	10 2,919 2,929

A. Financial liabilities with respect to Max by level

	September 30, 2024
	Fair value
	On balance sheet balances	Level 1	Level 2	Level 3	Total
In NIS million		Unaudited
Financial liabilities
Credit from banking corporations	5,607		‐ 5,607	‐	5,607
Payables for credit card transactions	9,590		‐	‐ 9,534	9,534
Bonds and subordinated notes	793		‐ 797	‐	797
Other financial liabilities	361		‐	‐ 361	361
Total financial liabilities	16,351		‐ 6,404	9,895	16,299

	September 30, 2023
		Fair value
	On balance sheet balances	Level 1	Level 2	Level 3	Total
In NIS million			Unaudited
Financial liabilities
Credit from banking corporations	5,339	‐	5,339	‐	5,339
Payables for credit card transactions	8,534	‐	‐	8,485	8,485
Bonds and subordinated notes	736	‐	708	‐	708
Other financial liabilities	302	‐	1	301	302
Total financial liabilities	14,911	‐	6,048	8,786	14,834

		December 31, 2023
		Fair value
	On balance sheet balances	Level 1	Level 2	Level 3	Total
In NIS million			Audited
Financial liabilities
Credit from banking corporations	5,202	‐	5,202	‐	5,202
Payables for credit card transactions	8,072	‐	‐	8,020	8,020
Bonds and subordinated notes	582	‐	581	‐	581
Other financial liabilities	294	‐	‐	294	294
Total financial liabilities	14,150	‐	5,783	8,314	14,097

NOTE 7 - CAPITAL MANAGEMENT AND REQUIREMENTS

A. Share capital

	Ordinary shares ) *)
	September 30, 2024	September 30, 2023	December 31, 2023
	In thousands of shares of NIS 1 p.v.
Issued and paid-up share capital as of January 1	79,031	74,061	74,061
Issuance of shares		- 4,970	4,970
Exercise of options for senior employees	51		- -
Issued and paid-up share capital as of	79,082	79,031	79,031
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 12(c) below.

B. Approval of the Company's dividend policy and distribution

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.

It is hereby clarified that 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.

Further to the above, subsequent to the reporting date, on November 28, 2024, the Company's Board approved a dividend distribution totaling approx. NIS 100 million, which constitutes approx. 60% 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(d) above). Below is a description of the capital requirements of Clal Insurance and Max and details of the distribution of dividends by them.

1. 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 November 27, 2024, Clal Insurance approved its Economic Solvency Ratio Report as of June 30, 2024.

The calculation carried out by Clal Insurance as of June 30, 2024 was reviewed by the Company's independent auditors in accordance with the International Standard on Assurance Engagements (ISAE) 3000 (Revised), Assurance Engagements Other than Audits or Reviews of Historical Financial Information. This standard is relevant for the execution of the engagement to assess whether the Company's solvency calculations do not comply, in all material respects, with the Commissioner's Directives, and are not part of the auditing standards applicable to financial statements.

In accordance with the Solvency Ratio Report as of June 30, 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 June 30, 2024 attached to this report.

B. Dividend distribution policy and dividend distribution at Clal Insurance

Further to Note 17(c)2 to the Consolidated Annual Financial Statements of 2023, 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.

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 hereby clarified that 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.

Further to the above, 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.

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.

In June 2023 a NIS 40 million dividend was distributed after Max's Board of Directors approved the distribution, and all restrictions applicable to Max we complied with.

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 17(c)(3) to the 2023 Consolidated Financial Statements.

B. Capital adequacy and leverage pursuant to the Banking Supervision Department directives applicable to credit card companies

	As of	As of	As of December 31 2023
	September 30 2024	September 30 2023
In NIS million	Unaudited		Audited
1. Capital for capital ratio calculation purposes:
Total CET1 capital, after regulatory capital adjustments
and deductions	2,002	1,816	1,855
Tier 2 capital	460	604	461
Total overall capital	2,462	2,420	2,316
2. Balance of risk-weighted assets:
Credit risk - standardized approach	16,684	14,347	14,021
Market risks - standardized approach	116	53	19
Operational risk - standardized approach	3,234	2,777	2,876
Total balance of risk-weighted assets	20,034	17,177	16,916

1. **Capital adequacy, as per the Banking Supervision Department's directives (*)**

	As of September 30	As of September 30	As of December 31
	2024	2023	2023
In %	Unaudited		Audited
3. Ratio of capital to risk-weighted assets:
Ratio of CET1 capital to risk-weighted components	10.0	10.6	11.0
Ratio of total capital to risk-weighted assets	12.3	14.1	13.7
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

* 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%.

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 Max's exposure to Israeli banks derives from Israel's credit rating. Since Max 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 Max'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 is not expected to affect Max's capital ratios, and an even 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 at least two notches that - in Max's assessment - one can expect an approx. 0.3% decrease in its capital ratios as of September 30, 2024. 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.

	As of September 30	As of September 30	As of December 31
	2024	2023	2023
In NIS million	Unaudited		Audited
1. Common Equity Tier 1 capital
Equity	1,997	1,808	1,847
Total Common Equity Tier 1 capital	1,997	1,808	1,847
Regulatory adjustments:
Adjustments for current expected credit losses –
CET1 capital**	5	8	8
Total CET1 capital, after regulatory capital deductions	2,002	1,816	1,855
2. Tier 2 capital
Tier 2 capital: Instruments	250	424	285
Tier 2 capital: Provisions	210	180	176
Total Tier 2 capital	460	604	461
Total overall capital	2,462	2,420	2,316

3. Capital components for the calculation of capital ratio in Max

**) These data include adjustments in respect of the effect of first-time application of GAAP for current expected credit losses (hereinafter - "adjustments for current 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 September 30	As of September 30	As of December 31
	2024	2023	2023
In %	Unaudited		Audited
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	10.0	10.5	10.9
Effect of adjustments for current expected credit losses	0.02	0.05	0.05
Ratio of CET1 capital to risk-weighted components	10.0	10.6	11.0

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-riskbased 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%.

Following is the leverage ratio calculated in accordance with Proper Conduct of Banking Business Directive No. 218:

	As of September 30	As of September 30	As of December 31
	2024	2023	2023
In NIS million	Unaudited		Audited
Consolidated data:
Tier 1 capital	2,002	1,816	1,855
Total exposures	23,181	20,850	20,405

	As of September 30	As of September 30	As of December 31
	2024	2023	2023
In percentage	Unaudited		Audited
Leverage ratio	8.6	8.7	9.1
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 8 - 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 that might 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 that 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 otherwise² .

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 recent years there has been a trend of extending the prescription period in some insurance sectors, which could lead to an increase in insurance liabilities towards policyholders, among others, as part of the amendment to the Insurance Contracts Law that extended the prescription period in life insurance and in illness and hospitalization insurance and long-term care insurance to five years after the occurrence of the insured event, commencing on the date of entry into force of the amendment in 2020. 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 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.

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.

The proceeding begins with a written motion filed by the single plaintiff with the court where its personal claim has been filed, in which the plaintiff seeks to approve its personal claim as a class action (the certification motion). 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".

A class action lawsuit may only be filed in relation to a claim as detailed in the Law or in relation to a matter in respect of which an explicit provision of the Law has stipulated that a class action may be filed. It is noted that, since 2006, the definition of a claim in which a motion to certify may be filed against Group members has become an extremely broad definition, including any issue arising between a company and a customer, regardless of whether or not they have engaged in a transaction.

^1. See Footnotes 3 and 16 below.

^2. See Footnote 12.

For a claim to be certified as a class action, the plaintiff must prove, among other things: (1) the existence of a "personal cause of action" for the specific plaintiff; (2) that the cause of action is sufficiently established for there to be "prima facie cause of action". The court must then examine whether the plaintiff has a prima facie chance of eventual success in its suit; (3) that the cause of action raises material questions of fact or law that are common to a certain class; (4) that there is a reasonable possibility that the common questions in the claim will be determined in favor of the class; (5) that the class action is the most effective and fair method for resolving the dispute that is the subject of the claim, under the circumstances; (6) that the plaintiff is suitable to act as the lead plaintiff and that the attorneys are suited to represent it in the lawsuit.

In general, the process of examining whether a lawsuit is to be certified as a class action may include 4 stages: Stage A - filing the motion to recognize the claim as a class action in the first legal instance; Stage B - an appeal to a higher legal instance against the ruling handed down by the first instance; Stage C - adjudication of the claim on its merits before the first legal instance (usually before the same judge who heard the motion in the first instance); Stage D - an appeal to a higher legal instance against the ruling on its merits.

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.

The law prescribes a process and restrictions regarding settlement agreements in class actions that make it difficult to reach settlement agreements on class actions. As such, it also prescribes the obligation of proper disclosure to the court pertaining to all material details relating to the settlement arrangement, together with the right of the Attorney General and additional entities stipulated in the Law to file an objection to the proposed settlement arrangement, and in addition the Law also provides that an examiner should be appointed pertaining to the settlement arrangement as well as specific arrangements regarding the plaintiff's withdrawal of the motion to certify or the class action itself. Further to the report of the Inter-Ministerial Taskforce on Assessing the Arrangements Set in the Class Actions Law, 2006, which was published in March 2023 (for further details see Note 45(1.1) to the Company's financial statements as of December 31, 2023), in May 2024 the draft bill of the Class Actions Law was published, which suggests to pass into law the taskforce's recommendations.

As part of the draft bill it is suggested, among other things, to add - in a format of a Temporary Order - a mechanism requiring that advance contact be made with a defendant prior to filing a certification motion, regarding specific types of causes of action and claims, including payment of fee for such advance contact; to set restrictions as to the filing of claims for a remedy in the form of compensation regarding certain types of causes of action and claims; to give the court the power to strike out oppressive and vexatious motions; to set uniform and clear rules regarding compensation and legal fees, including the option of a compensated withdrawal and subjecting the payment of legal fees to a representing attorney to the condition that the settlement agreement will be implemented; to set a mechanism enabling the filing of additional motions on the same issue in order for the court to select the claim along with the leading attorney in causes of action pertaining to securities laws; to set mechanisms pertaining to compensation between class members, including granting a remedy in kind; to set an orderly mechanism for approval of a settlement agreement by a mediator; to set an outline for ruling legal fees and compensation to the applicant or the lead plaintiff; to set a requirement whereby the applicant or their attorney will be subject to legal expenses if the certification motion/class action was filed or conducted in bad faith; 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; to allow organizations to file class actions; 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 circular (as defined in the draft bill), such as the existence of a regulatory approval for the relevant action, the time, which has elapsed since the contract was signed; evidential difficulties; changes in the legislative arrangement since the contract signing date; 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 is also suggested that if a motion will be filed to dismiss the motion to certify for the above reasons, and the court believes that there is merit to the dismissal motion, the Attorney General will be asked to present their position regarding this argument.

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, among other things, on the final wording of the provisions and on the manner by which they are implemented and interpreted by the different courts. However, making the provisions pertaining to conducting legal proceedings regarding breach of the Long-Term Savings circular binding may reduce the Company's exposure to class actions in this segment.

The motions to certify claims as class actions set forth below, are currently in the various stages of procedural adjudication, some have been approved and some are undergoing appeal proceedings.

1.2Additional 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 might 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 sector-wide 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.

In March 2023, the Company completed the acquisition of all the issued and paid-up share capital of Warburg Pincus Financial Holdings (Israel) Ltd., a holding company that holds, among other things, Max It Finance Ltd. (Max), whose name has been changed to CIMax Holdings Ltd. (hereinabove and hereinafter, respectively - "Max" and "Max").

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), other material claims outside the ordinary course of business (Section 2.3) which were all brought against the Company and/or the consolidated companies, except the Max Group Companies.

2.1Class 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.

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. In relation to the consolidation of Max's reports with the Company's financial statements and for immediate reporting purposes, regarding the disclosure policy in the financial statements in relation to the Max claims, in the financial statements, see Section 3 below.

	Date and		Key claims and causes
1.	court	Defendants	of action	Key remedies	Represented class	Status / additional details	Claimed amount
	5/2013 District Court - Tel Aviv	Clal Insurance and additional insurance companies	According to the plaintiff, the defendants are in breach of their duty to add linked interest as well as the lawful linkage differentials in respect of the insurance benefits they pay. According to the plaintiffs, the date from which interest and linkage differentials should be calculated is the insured event's occurrence date, until the actual payment date. Alternatively, linkage differentials must be paid from the insured event's occurrence date and until the actual payment date, and interest must be paid starting 30 days from the date of submitting the insurance claim until the actual payment of insurance benefits.	Charge the defendants to pay the class members linkage differentials and interest due to the underpayment. In addition and/or alternatively, the court is asked to order damages to the public, as it deems suitable.	Anyone who was paid insurance benefits from the defendants in the 7 years preceding the day the lawsuit had been filed and/or who will be paid insurance benefits from the defendants before a judgment is rendered in the lawsuit, without lawfully adding interest to the insurance benefits the (hereinafter - the "First Class") and lawfully adding linkage differentials to the insurance benefits (hereinafter - the "Second Class").	In August 2015, the District Court rendered its ruling to dismiss the motion to certify against the defendants with respect to the claim of non-payment of linkage differentials, but accept the motion to certify against the defendants with respect to the claim of underpaying interest on insurance benefits; it was found that the eligible class members are all policyholders, beneficiaries, or third parties, who, during a period starting three years before the lawsuit had been filed and ending on the day the lawsuit was certified as a class action, had been paid insurance benefits from the defendants (unless the above were paid not in accordance with a judgment rendered between them), without adding the lawful interest, within 30 days from the date of submitting the insurance claim with the insurer (not from the date of submitting the last document the insurer had required to clarify the liability), and until the actual payment date. In August 2016, the defendants, with the Supreme Court's approval, had stricken out a motion for leave to appeal they had brought, whose gist was an objection to the District Court's ruling, according to which a prior settlement arrangement the Company had made on a similar issue does not establish res judicata that precludes bringing the motion to certify and does not establish a defense for the defendants, while the parties reserved all their claims to the main proceeding. In February 2021, a partial judgment was rendered, in which the court determined that the class action was granted, and charged the defendants recovery of interest differentials to the class members, as detailed in the judgment (hereinafter - the "Judgment"). In accordance with the Judgment, it was found that the "day of filing an insurance claim," on which the 30-day race begins and after which linked interest must be added to the insurance benefits in accordance with the provisions of Section 28(a) of the Insurance Contracts Law, 1981 (hereinafter - the "Insurance Contract Law"), is the date the insurance company or the insurance agent, whichever is earlier, first receive an inquiry indicating that the policyholder, a third party, or the beneficiary (hereinafter - "Entitled Parties"), wish to be paid the insurance benefits, without needing to attach any document. It was further determined that when the insurance benefits are calculated at their value on a date after the insured event's occurrence, interest will be added to them only from that date, and with respect to recovery of funds paid to service providers in a deferred payment – the interest differentials would be calculated starting from the actual payment date.	The plaintiff estimates the cumulative amount due to the First Class at NIS 518 million (if it is decided that the interest must be calculated from the insured event's occurrence date), or at NIS 210 million (if it is decided that the interest must be calculated starting 30 days from the date of filing the insurance claim to the insurance company). The plaintiff estimates the cumulative amount due to the Second Class (for which the motion to certify was denied) at an additional amount of NIS 490 million, due to linkage differentials.

66 - 2

1.	Date and		Key claims and causes
(cont.)	court	Defendants	of action	Key remedies	Represented class	Status / additional details	Claimed amount
						The court ruled that the definition of the class would cover all Entitled Parties who, during the period commencing three years prior to bringing the lawsuits (filed against Clal Insurance in May 2013) and ending on the day of rendering the Judgment, were paid insurance benefits from the defendants, not in accordance with a judgment in their case, without the lawful interest added to them. It was also determined that for the purpose of implementing the Judgment and calculating the total damages to the class members in accordance with the principles set forth in the partial judgment, an expert must be appointed, and that the reward payable to the lead plaintiffs and their counsels' legal fees would be determined in the final judgment. In May 2021, the defendants filed an appeal, or, alternatively, a motion for leave to appeal the Judgment to the Supreme Court. In November 2022, the Supreme Court rejected the motion for leave to appeal that had been filed as said above, in the absence of a cause for judicial interference, mainly because the partial judgment constituted "a non-judgment ruling," and the appellate court's starting point is that it would only interfere in the trial court's interim rulings in highly unusual cases. Accordingly, it was held that the appropriate venue for investigating the defendants' claims was in an appeal on the final judgment in the lawsuit, insofar as an appeal is filed. The Supreme Court clarified that it was not taking a stand on the issue of the hypothetical appeal to be filed on the final judgment. The proceeding is at the stage of litigating the claim before the District Court, and in January 2023, within the above, the court rendered its ruling on the identity of and the authorities vested in the expert. In December 2023, the defendants submitted a motion for clarification regarding the court's ruling. As part of the plaintiffs' response to the motion for clarification, the court was moved to award expenses as well as exceptional/special interest in favor of each of the members of the class, as well as expand the definition of the class such that it includes all the policyholders, third parties and beneficiaries to whom the interest has not been paid as of the date of the partial judgment (June 28, 2021), and until the date of the judgment. In April 2024, the court rendered its decision on the motion for clarification, in which it was mainly determined that within the decision in question, the court's entire role at this stage, is – at most – to clarify the court's partial judgment (rendered by a different judge), and that even if the defendants have good claims, the court can only adhere to the findings in the judgment. The motions for clarification were partially dismissed. The plaintiffs' motion was not discussed within the decision.

	Date and				Represented
2.	court	Defendants	Key claims and causes of action	Key remedies	class	Status / additional details	Claimed amount
	1/2008 District Court - Tel Aviv	Clal Insurance and additional insurance companies	According to the plaintiff, the defendants charge sub-annuals, a payment that is collected in life insurance policies in which the insurance rate is determined as an annual amount but the payment is made in several installments (hereinafter - "Sub-Annuals"), at an amount that exceeds the permitted amount, and they do so, allegedly, in several methods: collecting Sub-Annuals with respect to the "policy factor" component, collecting Sub Annuals at a rate that exceeds the permitted rate in accordance with the Insurance Supervision circulars, collecting Sub-Annuals with respect to the savings component in life insurance policies, and collecting Sub Annuals with respect to non-life insurance policies.	Refund of all the amounts the defendants had collected unlawfully, as well as a mandatory injunction ordering the defendants to change their modus operandi with respect to the matters specified in the lawsuit.	Anyone who has contracted with the defendants or any of them under an insurance contract and was charged due to a "Sub-Annuals" component under impermissible circumstances or at impermissible amounts.	The Commissioner submitted his position in the case, in which he concurred with the insurance companies' position. In July 2016, the court certified the lawsuit as a class action. The certified class consists of anyone who entered into an insurance contract with the defendants or any of them and was charged Sub-Annuals with respect to the following components: with respect to the "mixed" life insurance savings component sold by Clal Insurance in the past, with respect to the "policy factor" (which is a fixed monthly amount that is added to the premium whose aim is to cover expenses), and with respect to health policies, permanent health policies, critical illness policies, permanent health policies, and long-term care policies (hereinafter - the "Collection Components"). The court's ruling was rendered despite the Commissioner's position, which had been stated at the request of the court, as said above. The cause of action for which the claim has been certified as a class action is the unlawful collection of Sub-Annuals due to the Collection Components. The relief sought is a refund of the sums that had been collected unlawfully in the seven years preceding the date of filing the lawsuit and thereafter, i.e., from January 2001, as well as a mandatory injunction ordering the defendants to rectify their conduct and to cease charging sub-annuals on collection components. In December 2016, the defendants filed a motion for leave to appeal against the ruling to certify the claim as a class action to the Supreme Court (hereinafter - "MLA"), and in May 2018, the Supreme Court accepted the MLA, heard it as an appeal, and rendered a judgment granting the appeal and dismissing the lawsuit accordingly. In June 2018, the plaintiffs moved to hold a further hearing of the judgment, with respect to some of the findings therein. In July 2019, a ruling was handed down in favor of holding a further hearing on the case, by an extended panel of 7 judges. In February 2020, a position was submitted to the Supreme Court on behalf of the Attorney General within the further hearing, according to which, the Attorney General believed that there was no justification to intervene with the ruling rendered in the judgment on the appeal, which was based on adopting the Capital Market Authority's interpretive position. 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 would be reinstated, such that the motion to certify would be granted and the case would be returned to the District Court to hear the class action lawsuit on its merits. The proceeding is currently being litigated before the District Court. The parties are conducting a mediation procedure.	In February 2010, the parties reached a procedural arrangement according to which the plaintiff's claims that Clal Insurance had overcharged on Sub-Annuals, compared with the permissible charges in connection with insurance policies that had been issued before 1992, and that Clal Insurance charged the maximum Sub Annuals even when the number of payments was lower than twelve payments, would be withdrawn from the motion and the lawsuit. Accordingly, the amount claimed from Clal Insurance was revised and set at approx. NIS 398.2 million.

68-2

	Date and
3.	court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details	Claimed amount
	7/2014	Clal Pension and Provident Funds Ltd. as well as against four other pension fund management companies.	According to the plaintiffs, who are two associations that claim their objective is to aid the elderly population, the defendants raised the management fees it charged from pensioners in the pension funds they manage at the stage of paying the pension, to the maximum lawful management fees ceiling (0.5% of the accumulated balance), while taking advantage of the pensioners' position as a "captive audience," while active planholders paid significantly lower management fees, on average. It was further claimed that the defendants do not disclose to their planholders that when they become pensioners, the management fees they pay the defendants would immediately be raised to the maximum management fees.	To require the defendants to return the excess management fees unlawfully charged from the class members with interest and linkage; to require the defendants to lower the management fees charged to the pensioners, such that they do not exceed the management fees it charged before each one of them retired; to prohibit the defendants from raising the planholders' management fees immediately before they retire.	Anyone who is a planholder of a comprehensive new pension fund, managed by one of the defendants, and is entitled to be paid an old-age pension and/or will be entitled to be paid an old-age pension in the future.	In September 2015, the plaintiffs submitted a reply to the defendants' response to the motion to certify (hereinafter - the "Plaintiffs' Response"), in which, among other things, a new claim was raised: that the defendants did not send the planholders prior notice of raising the management fees, as required in accordance with the provisions of the law. As per the court's request, the Commissioner submitted its position in September 2017, which held, inter alia, that in accordance with the provisions of the law and the July 2014 circular, management fees lower than 0.5% could be collected during the pension payment period, and that the defendants had no regulatory duty to notify of a management fee increase once the planholders reached retirement age. In March 2022, the District Court decided to grant the motion to certify against the defendants, with respect to whether the defendants had had to notify the planholders of the management fees they would be charged in the pension period in advance, and if so, what damage had been caused by the failure to provide such a notice. The certified class contains anyone who is a planholder in a new comprehensive pension fund managed by one of the respondents and is entitled to be paid an old-age pension after they retire in the seven years prior to submitting the motion to certify and/or will be entitled to be paid an old-age pension in the future. It is noted that pension beneficiaries who retired in the latter half of 2018 will be given notice in accordance with the standard-conforming bylaws the regulator had published, that came into force starting in that year. The lawsuit is currently being litigated on its merits, and the parties are conducting a mediation proceeding at the same time.	According to the plaintiffs' assessment, the management fees the defendants collected unlawfully from current pensioners are estimated at NIS 48 million, the management fees that will be unlawfully collected from current pensioners in the future by the defendants are estimated at NIS 152 million, and the management fees the defendants will unlawfully collect from future pensioners in the future, due to the accrual to date, are estimated at NIS 2,800 million. The said amounts are claimed with respect to all the defendants.

	Date and		Key claims and
4.	court	Defendants	causes of action	Key remedies	Represented class	Status / additional 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" might 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.	Any policyholder of a long term care insurance sold by the defendants (or the heirs of the above, as applicable), and who suffered from poor health and functioning as a result of an illness or accident or health impairment, because of which they suffered from incontinence and/or regularly used a stoma, a urinary catheter, or diapers or absorption products of all kinds, and despite the above – were not assigned a score from the defendants (as applicable) for the incontinence component, which has led to their rights being infringed.	In April 2020, the court partially certified the lawsuit as a class action lawsuit against Clal Insurance and three other insurance companies. The certified class includes any policyholder of long-term care insurance who suffered from 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. 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 remedy sought in the lawsuit is compensation to the class members who were not assigned 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 at this stage, but they estimate it in the tens and even hundreds of millions of shekels. The plaintiff's alleged individual damage from Clal Insurance sumps up to approx. NIS 32,500 (without linkage differentials and interest).

	Date and		Key claims and
5.	court	Defendants	causes of action	Key remedies	Represented class	Status / additional 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. The parties are conducting a mediation proceeding, as part of which - in November 2023 - a binding procedural arrangement was signed, according to which the parties agreed on giving or supplementing a discount for the relevant policyholders at the rates agreed upon by the parties. The procedural arrangement is subject to examination by an external expert, according to the agreed outline of principles, following and according to which the settlement agreement will be formulated and submitted to the court.	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
6.	court	Defendants	causes of action	Key remedies	Represented class	Status / additional details	Claimed amount
	11/2019 Regional Labor Court - Tel Aviv	Clal Insurance	According to the plaintiff, Clal Insurance charged management fees in life insurance policies with an integrated profit-sharing savings component issued before January 12, 2004 (hereinafter - the "Relevant Policies"), at rates that deviate from the permissible limits, without a legal and/or contractual basis.	Remedy in the form of restitution of the management fees the class members were unlawfully charged, as well as a mandatory injunction ordering Clal Insurance to change its modus operandi with respect to the collection of management fees in the Relevant Policies from here on out.	Any policyholder of Clal Insurance under the Relevant Policies and whom Clal Insurance charged due to management fees in excess of the permitted limit under the Supervision of Financial Services Regulations (Insurance) (Conditions in Insurance Contracts), 1981, according to the wording at the time and/or according to the provisions of the policy, during the 7 years prior to the date of filing the lawsuit and up to the date the lawsuit is certified as a class action.	In June 2023, the Regional Labor Court decided to reject the claims that Clal Insurance charged management fees out of the accrued savings in violation of the law or contrary to the provisions of the policy, as well as the alternative claim that Clal Insurance charged management fees out of the accrued savings at a rate that exceeded the rate permitted by law; however, the Court decided to partially certify the lawsuit as a class action claiming that Clal Insurance collected management fees from policyholders insured under the relevant policies management fees out of premium contrary to the provisions of the policy. It is noted that these policies have been marketed since 1999. The class members comprise anyone who was or is a policyholder of the respondent under a Relevant Policy in the period beginning seven years prior to the date of filing the lawsuit and ending on the day the lawsuit was certified as a class action lawsuit, and whom Clal Insurance charged premium management fees. The causes of action for which the lawsuit was certified as a class action lawsuit are: a breach of agreement, unjust enrichment, and a breach of statutory duty, including a breach of Clal Insurance's duties of trust and duties of care, and deception. The parties are conducting a mediation procedures. In April 2024, the plaintiff appealed to the National Labor Court regarding the causes of action that were dismissed in the decision to certify the lawsuit as a class action, and on the same day, Clal filed a motion for leave to appeal the decision to partially certify the lawsuit's adjudication as a class action; at the same time, the parties sought to stay the proceedings in the National Court to attempt to complete the mediation.	NIS 120 million.

	Date and		Key claims and
7.	court	Defendants	causes of action	Key remedies	Represented class	Status / additional details	Claimed amount
	05/2022 District Court - Central	Clal Insurance	The lawsuit concerns the allegation that in policies that cover surgeries in Israel that stipulate compensation for surgeries performed without financing from Clal Insurance, Clal Insurance refrains from compensating the policyholders for the cost of the implants and accessories used to perform the surgery (hereinafter - the "First Cause"), and also refrains from indemnifying the policyholders for the deductible amounts they had paid (hereinafter - the "Second Cause").	The main remedies the plaintiffs are seeking are a judgment compelling Clal Insurance to include the cost of the implant and/or accessory in the calculation of the benefits owed to the class members from here on out, and compelling it to indemnify the class members for the deductible amounts they paid in connection with the various surgeries and to calculate the compensation accordingly, as well as a judgment compelling Clal Insurance to compensate each member of the sub category with respect to the monetary remedies, at the rate of 50% (or another rate) of the cost of the implant borne by Clal Insurance and/or the deductible amount paid by the class member due to a surgery they had, with added linkage differentials and interest, as per the law.	The movant sought to define a future class comprising mainly Clal Insurance policyholders, who are entitled to compensation at the rate of half (or another amount) of the amount Clal Insurance saves if it does not fully fund the surgical procedure; the movant also sought to define the class, with respect to the monetary remedies, consisting mainly Clal Insurance policyholders who are entitled to compensation at the rate of half (or another amount) of the amount Clal Insurance saves if it does not fully fund the surgical procedure, as part of whose claims compensation was not included for accessories and/or without Clal Insurance repaying the deductible to the policyholder during the 7 years before the lawsuit was filed.	In November 2024, the court decided to partially allow the motion, such that it allowed the first cause of action and dismissed the second cause of action. Class members are all Clal Insurance policyholders under the relevant policies, who had a surgical procedure in a private hospital and are eligible to compensation out of the amount Clal Insurance saved following the funding of the surgical procedure by the health maintenance organization over a period starting 3 years prior to the filing of the motion to certify and through the issuance of a judgment in the lawsuit, where compensation was calculated without including the implants component. The cause of action for which the lawsuit has been certified as a class action is breach of contract.	The plaintiff estimates that the aggregate damage caused to the class members is over NIS 2.5 million.

	Date and		Key claims and
8.	court	Defendants	causes of action	Key remedies	Represented class	Status / additional details	Claimed amount
	5/2019 Regional Labor Court - Tel Aviv	Clal Insurance	According to the plaintiff, the defendant systematically reduces the permanent health insurance benefits it pays its policyholders under its participating permanent health insurance policies, by unlawfully deducting management fees and calculative interest.	Restitution in kind of the funds the class members were unlawfully denied, according to the plaintiff, and with respect to the premium release funds – crediting the policies' savings. The plaintiff also petitions to declare that certain provisions of the policies, in relation to the interest and management fees deduction from the yield to which the policyholders are entitled, are void.	All policyholders or former policyholders under participating permanent health insurance policies that include a mechanism to link the monthly benefits payments and/or the release from premiums to the investment portfolio return, starting from the 25th payment, to whom Clal Insurance has paid monthly benefits and/or a release for a period exceeding 24 months, and starting from the 25th payment, deducted interest and/or management fees from the return.	In November 2024, the Regional Labor Court partially certified the lawsuit as class action, while allowing the claim regarding the unlawful deduction of the calculative interest rate as from May 28, 2016; the court dismissed the claim regarding unlawful deduction of management fees from the insurance benefits. The causes of action in respect of which the lawsuit was certified as a class action are alleged breach of Section 3 to the Insurance Contracts Law, alleged breach of the duty to draft the insurance contract in a clear manner and include therein all relevant provisions, and alleged breach of the duty to act in good faith and unjust enrichment.	The plaintiff estimates the total alleged damage to all class members at NIS 2.4 billion.

7422.1.2 Pending motions to certify material claims as class actions against the Company and the consolidated companies, with the exception of the Max Group companies4

1.	Date and court	Defendants	Key claims and causes of action	Key remedies		Represented class	Status / additional details	Claimed amount
	9/2015 District Court - Tel Aviv	Clal Pension and Provident Funds, as well as four other companies that manage pension funds	According to the plaintiffs, who are planholders in the pension funds managed by the defendants, the mechanism to remunerate agents and brokers with fees and commissions as a rate out of the management fees planholders are charged, as had been the custom among the defendants, is a breach of the duty of loyalty toward the planholders in the provident funds the defendants manage, and leads to the collection of higher management fees than appropriate by the defendants.	the agent charged. is	To require the defendants to alter compensation mechanism and to pay the planholders back the excessive management fees they were	Planholders of provident funds managed by the plaintiffs, who were charged management fees from which the agents' commission is derived based on the management fees amount.	In November 2022, the District Court's rendered its judgment, in which the motion to certify was denied. In January 2023, the plaintiffs appealed the judgment. The proceeding is at the stage of hearing the appeal.	According to the plaintiffs' assessment, the damage to all class members is approx. NIS 2 billion, reflecting approx. NIS 300 million in annual damage since 2008.
2.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details		Claimed amount
	7/2019 Regional Court - Tel Aviv	"Atudot" - The Pension Fund for Workers and Independent Workers Ltd. (a subsidiary of Clal Insurance (held at 50%) (hereinafter - "Atudot")	lawsuit concerns the allegation whereby Atudot charges its planholders, in addition to management fees, "investment management expenses" (hereinafter - "direct expenses") in the absence of a contractual provision that allows it to charge such expenses and in contrast with the fund's bylaws.	The plaintiffs seek to compel Atudot to return the excessive direct expenses amounts they were charged.	The planholders in the pension funds who were charged investment management expenses in the seven years before the relevant lawsuit was filed.	"Certification motion Supreme Court (hereinafter - not a party to this proceeding. therefore entitled to collect expenses. National Labor Court.	In May 2019, the Central District Court rendered a ruling granting the motion to certify a class action lawsuit due to the collection of direct expenses in individual life insurance policies (hereinafter - Ruling"). In the Certification Ruling, it was determined that the absence of a clear provision in the policy regarding the collection of direct expenses is a negative arrangement, and therefore, the defendants were not prohibited from charging these expenses. In for leave to appeal the Certification Ruling was brought to the the "Motion for Leave to Appeal"). Atudot was In June 2023, the Supreme Court rendered its decision after hearing the motion for leave to appeal as an appeal, and granted the appeal on the Certification Ruling, while stating that insurance companies and management companies act as trustees for the planholders' funds and are 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	The class action claimed amount the was set at approx. NIS 41 million, based on an assessment. September 2019, a

⁴ Including such motions that were denied and the ruling to deny them was appealed.

3.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details Claimed amount
	2/2020 District Court - Central	Clal Insurance and another insurance company	According to the plaintiffs, due to "lack of knowledge" following the failure to present the personal accidents insurance policy (hereinafter - the "Policy") to the students, to the policyholders, and to their relatives, and the Policy's non-publication, the policyholders have not been exercising their right to benefits under the Policy, and they are incurring damages.	Issue orders against the defendants and the Insurance Commissioner for the discovery of documents and data; order the extension of the prescription period; order the appointment of a committee that will include independent members and will be authorized to discuss and decide all personal claims under the Policy for three years, in respect of all cases before October 25, 2016 (hereinafter - the "Committee"), and will also be authorized to discuss the issue of the Policy's delivery; order a procedure for transferring the burden of evidence; issue a mandatory injunction ordering the defendants to compensate the plaintiffs in accordance with the Committee's ruling; award special damages to the plaintiffs and the counsels' legal fees.	The motion classifies the plaintiffs into several subcategories, mainly including: Any student in a school or kindergarten in the State of Israel who had been insured under a personal accidents insurance policy by the defendants and did not receive a copy of the personal accidents insurance policy at their home, starting from the school year that started in September 2006, and/or any student whose cause of action against the insurance company has become invalid under the statute of limitations; In addition, the motion defines additional subcategories, comprising students who were born after October 25, 1995, and who, between the ages of 3 and 19 (while in the Israeli education system, from kindergarten and until their graduation from the 12th or 13th grade), suffered an accident that resulted in physical harm, and who were not paid insurance benefits in accordance with the Policy, divided into sub categories according to the type of harm, as detailed in the motion; In addition, a subcategory comprising of people born in 1974 to 1995, whose members are people and/or their parents and/or heirs who were born and/or studied in Israel between 1974 and 1995 and who were injured or killed after 1992, and did not file insurance claims because they did not know about the Policy and its scope; and the subcategory of all policyholders – all students and all their parents, from September 1992 to September 18, 2016, divided into sub categories according to the causes of harm, as detailed in the lawsuit.	The proceeding is at the The plaintiffs estimate stage of the motion to the alleged damage certify being reviewed. against Clal Insurance at approx. NIS 1.4 Let it be noted that similar billion, plus approx. NIS motions and claims were 1.5 billion in damage filed against Clal Insurance attributable to the two and were stricken out by the defendants due to court on procedural breach of autonomy. grounds, in January 2020.

Date and
Status / additional

4.
Defendants
Key claims and causes of action
Key remedies
Represented class
details
court
3/2020
Clal Insurance
According to the plaintiff, Clal
(1) Restitution of all funds charged out of
The represented class for the purpose of
The proceeding is at the
Insurance systematically violates
the accrual and/or otherwise in respect of
the non-pecuniary remedies is all
stage of the motion to
Regional
the provisions of the law by
the entire period following the termination
policyholders under provident funds or
certify being reviewed.
Labor
charging
unlawful
insurance
of employment (except when the
insurance plans within which employers
Pursuant to the court's
Court -
Tel
premiums for "temporary risk"
policyholder has asked to purchase the
and/or employees make contributions for
ruling, the Commissioner
Aviv
insurance (payment for insurance
insurance
coverages
in
writing).
permanent health insurance and/or
of the Capital Market,
coverage when the regular
Alternatively, restitution of all funds
insurance in case of death, or any other
Insurance and Savings
deposits into a savings policy with
collected for the period after 3 or 5 months
insurance risk.
Authority (hereinafter -
combined insurance components
from the termination of their employment,
the "Commissioner")
The represented class for the purpose of
are discontinued), by making
in accordance with the relevant statutory
submitted his position,
the pecuniary remedies is: (a) all the
excessive deductions out of the
arrangement
(hereinafter
-
the
clarifying that collecting
policyholders for whom funds were
accrued savings amount and thus
"Automatic Temporary Risk Period"),
insurance premiums is
collected for permanent health insurance
reducing the accrued savings,
and in cases of higher insurance premiums,
permissible
only
in
or insurance in case of death or any other
without
informing
the
restitution of the excess insurance
accordance with the
insured event, out of the accrual funds or
policyholders in advance of
premiums in respect of the Automatic
provisions of the law and
any other source, without prior notice; (b)
making the "temporary risk"
Temporary Risk Period as well; (2) a
the applicable policy.
alternatively, policyholders who were
insurance and of its terms and
prohibition on making "temporary risk"
charged insurance premiums for periods
rates, and in breach of the duty to
insurance policies for a period exceeding
that exceed the Automatic Temporary Risk
send the policyholders up-to-date
the Automatic Temporary Risk Period,
Period, unless they agreed in advance; (c)
insurance information sheets on
except when the policyholders request this
policyholders who were charged higher
time or at all.
it in writing; (3) compelling Clal Insurance
insurance premiums than the insurance
to return the excess insurance premiums
premiums they were charged when they
paid by policyholders who were charged
were active policyholders and/or who were
double insurance premiums (for the month
charged for new insurance policies that
they returned to work); (4) various
they did not have prior to the termination
provisions relating to future conduct
of their work; (d) policyholders who were
(including a prohibition on increasing
charged double insurance premiums.
premiums, giving prior notice of the
purchase of a temporary risk, and more).

Claimed amount
The class action claimed
amount is estimated
conservatively,
according
to
the
plaintiff, at no less than
NIS 7 million per year.
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.

5.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details	Claimed amount
	4/2020 District Court - Tel Aviv-Jaffa	Clal Insurance and 12 additional insurance companies	According to the plaintiffs, the respondents must be compelled to compensate the class members and fully remedy the harm they incurred due to the excess premiums they have been paying for motor insurance, due to the dramatically reduced use of vehicles during the Covid-19 pandemic and the significantly reduced risk level.	Compensate the class members, repair all the harm they suffered, issue a mandatory injunction ordering the adjustment of the collected amounts to the risk the respondents are actually exposed to during the effective period, and/or render a declaratory judgment 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.	Any policyholder of one or more of the respondents, under a compulsory motor insurance and/or comprehensive motor insurance and/or third-party motor insurance policy, during the period commencing on March 8, 2020, and ending on the date of full and final removal of movement restrictions imposed on residents of Israel due to the coronavirus, or part of it.	The proceeding is at the stage of the motion to certify being reviewed. In February 2021, the court ordered the consolidation of the motion to certify this class action lawsuit, with respect to 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 filed in April 2021.	The plaintiffs estimate the alleged damage against Clal Insurance in respect of the period from March 8, 2020, until April 30, 2020, at NIS 103 million, and jointly for all the respondents (except one), at approx. NIS 1.2 billion. Alternatively, for 8 of the defendant companies (that do not include Clal Insurance), it was claimed that the damage is approx. NIS 720 million. The movants note that the damage accrued further as the collection did not cease.

Date and
6.	court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional 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 estimate that the total damage to all class members in relation 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.

	Date and
7.	court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details	Claimed amount
	9/2020 District Court - Haifa	Clal Insurance	According to the plaintiff, Clal Insurance does not act in accordance with its undertakings, as it regularly refunds its policyholders for a significantly lower amount than the amount it warranted within the implementation of the "no claims bonus" clauses in health policies Clal Insurance used to sell, which entitle policyholders to be refunded part of the insurance premiums they paid if no insurance claims are made over the period specified in the policy.	The remedy the plaintiff is petitioning for includes compelling Clal Insurance to compensate each of the class members entitled to the no claims bonus for the relative share of the insurance premiums they were not refunded, with interest and linkage.	All Clal Insurance policyholders that hold private and collective health insurance policies, including extended health insurance and full liability insurance and including policies whose names had been changed over the years, that include a "No Claims Bonus" clause, who did not claim and/or refrained from claiming benefits for 3 years or any other period in accordance with the policy, and were entitled to a refund of 10% of the insurance premiums they had paid, or another refund rate according to the terms of the policy, and were paid a lower amount than the amount they are owed under the terms of the policy during the lawsuit period.	The proceeding is at the stage of the motion to certify being reviewed.	The plaintiff estimates the damage to all class members at NIS 33.6 million in the seven years prior to filing the lawsuit.

8.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details	Claimed amount
	9/2020 District Court - Central	Clal Insurance and another insurance company	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%.	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.	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.	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. The arrangement is subject to the court's approval, and there is no certainty that it will be accepted.	The plaintiffs estimate that the total damage to all class members in relation to Clal Insurance totals NIS 16.8 million.
9.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details	Claimed amount
	4/2021 District	Clal Insurance and 14	The lawsuit concerns the claim that the defendants are violating	The main remedies the plaintiffs are petitioning for are: to instruct	All the defendants' customers who used the digital services on the	The proceeding is at the stage of the motion to certify being reviewed.	The claimed amount is estimated by the

websites and apps operated by the defendants in the seven years before the lawsuit was filed, and about whom private and/or personal and/or confidential information was transferred to a third party.

the defendants to cease transferring information about their customers to third parties, to act in accordance with the law and guard and protect the customers' privacy, to disclose all the documents in their possession and that may aid in the investigation into the truthful, and to compensate the plaintiffs for the pecuniary and non-pecuniary damages they incurred.

Court - Tel Aviv-Jaffa

additional companies the provisions of the law by transferring their customers' personal and confidential information, without the customers' consent, to third parties (in particular, to Google and its advertising service), thus infringing on the customers' right to privacy and violating their

lawful obligations.

plaintiff at more than NIS 2.5 million.

	Date and
10.	court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details Claimed amount
	7/2021 District Court - Tel Aviv-Jaffa	Clal Insurance and 6 additional companies	The lawsuit concerns the allegation that when receiving an annuity from a profit-participating policy issued between 1991 and 2004, the defendants deduct annual interest at a rate of 2.5 (or any other rate) out of the monthly return accrued due to the lower cash surrender value, unlawfully and without any contractual basis under the terms of the policy.	The main remedies claimed in the lawsuit are a declaratory order according to which the interest deduction from the monthly return is a breach of the policies, and alternatively – a declaratory relief according to which this is a depriving condition in a standard contract and a motion to order its nullity, and to order a refund of the amounts deducted from the class members' monthly annuity, plus 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.	The defendants' policyholders who purchased from them a life insurance policy that includes accrued savings and investment income participation, issued between 1991 and 2004, and from which interest was and/or will be deducted at a rate not specified in the policy, based on the provision in the policy, according to which the amount of the monthly pension will change "each month according to the results of the investments net of the interest according to which the amount of the monthly pension was calculated, and the appropriate provisions for this matter in the insurance plan" and/or any other similar provision.	The proceeding is at the The plaintiffs estimate the stage of the motion to aggregate damage to all class certify being reviewed. members in an amount greatly exceeding NIS 2.5 million.

	Date and
11.	court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details Claimed amount
	10/2021 District Court - Lod	Clal Insurance and additional company	The lawsuit concerns the allegation that the defendants unlawfully deny insurance claims by children with special needs in the framework of a long-term care insurance policy, even though, according to the plaintiffs, they meet the definition of an insured event by virtue of "mental frailty" according to the terms of the policy, without checking whether their condition falls within this definition.	The main remedies claimed in the lawsuit are full compensation to the class for all the harms they were caused and compelling the defendants to comply with the insurance agreements.	All of the defendants' policyholders aged 21 and under (or their heirs), who have special needs and who are insured under a long-term care insurance policy sold by any of the defendants and who suffer from "mental frailty," who were not recognized by the defendants as being "mentally frail" and whose rights under the policy were denied, with respect to the past period and the future.	The proceeding is at the The plaintiffs estimate the total stage of the motion to alleged damage to the class certify being reviewed. In members against the two April 2023, the plaintiff filed defendants, jointly, at approx. NIS a motion for leave to 2.97 billion. appeal the District Court's ruling regarding the removal of the expert opinion and striking out sections of the response to the plaintiff's reply. In May 2023, the Supreme Court rendered a ruling according to which the motion for leave to appeal is granted, subject to granting the defendants the right to a supplementary response.

	Date and		Key claims and
12.	court	Defendants	causes of action	Key remedies	Represented class	Status / additional details Claimed amount
	04/2022	Clal	The lawsuit concerns the	The main claimed remedies are	The class the movant seeks to represent	The proceeding is at the stage of The plaintiff estimates the
	District	Insurance	allegation that Clal Insurance	a declaratory relief, according	is: (a) all policyholders who notified Clal	the motion to certify being aggregate damage to all class
	Court - Tel		continues to charge premiums	to which a policyholder's	Insurance of the policy's cancellation and	reviewed. In September, the members in many millions of
	Aviv-Jaffa		from policyholders, even after	cancellation notice would take	Clal Insurance did not cancel their	Supervisor submitted his shekels.
			the latter announce their	effect within 3 days from the	respective policy within 3 days from the	position, which generally
			policy's cancellation, as the	date of its delivery, and a	date of delivering the cancellation notice;	supports the position of the
			cancellation takes effect only	monetary remedy in the form	(b) all policyholders who notified Clal	defendant.
			on the 1st of the following	of returning all premiums	Insurance of the policy's cancellation and
			calendar month after Clal	policyholders were charged	whose cancellation notice was somehow
			Insurance receives the notice,	due to the period beginning	inadequate, and Clal Insurance did not
			rather than within 3 days from	from the fourth day after the	notify the policyholders of the inadequacy
			the date of delivering the	delivery of the cancellation	within 3 business days from the date of
			policyholders' cancellation	notice, and 50% of the average	delivery of the cancellation notice; (c) all
			notices, as required in	monthly premium as	policyholders who wanted to cancel the
			accordance with the legislative	compensation to the class	policy at any time in the previous calendar
			arrangement. It was claimed	members whose respective	month before the last 3 days of that
			that no full disclosure is made	cancellation notice had been	month, and delayed their cancellation
			to policyholders of the	delayed due to the provisions	notice due to the contractual arrangement
			applicable arrangement in	of the policy, with added	whereby the cancellation would take effect
			case the policyholder cancels	linkage differentials and	from the 1st of the calendar month
			the policyholder, before	interest. Alternatively, other	following Clal Insurance's receipt of the
			purchasing the policy.	declaratory / monetary reliefs.	cancellation notice.

13.	Date and	Defendants	Key claims and causes of action				Claimed amount
	court 07/2022 District Court - Tel Aviv-Jaffa	Clal Insurance	The lawsuit concerns the allegation that Clal Insurance denies policyholders' insurance claims in private health insurance policies it had marketed until February 2016, which include a basic insurance tier, on the grounds of the claim being filed due to "preventive surgery" that does not meet the definition of the term "surgery" in the policy (hereinafter - the "Basic Tier Policies"); as well as the allegation that Clal Insurance had marketed (for increased premiums) policies that supposedly offer wider coverage than the Basic Tier Policies and that include coverage for preventive surgeries, while this component is already covered by the Basic Tier Policies.	Key remedies The main claimed remedies are a declaration that in Clal Insurance's health insurance policies that define a "surgery" as an "insured event," any medically necessary surgery is included, including a preventive surgery that is intended to prevent a disease, defect, or deformity in the policyholder and/or the harmful effect of the above; a declaration that denying policyholders' insurance claims for coverage in respect of a preventive surgery under a Basic Tier Health Insurance Policy violates the insurance contract; and an order that requires Clal Insurance to contact the policyholders under all Basic Tier Policies, and inform them that preventive surgeries are covered under the insurance coverage in the policy.	Represented class The First Class the movant seeks to represent is any person who entered into a health insurance contract with Clal, which includes insurance coverage for "surgery," and whose claim due to a surgery was denied and/or will be denied on the grounds that it is a "preventive surgery" that is not covered by the policy, until a final and irreversible ruling is made in the class action lawsuit. The Second Class the movant wishes to represent is all former or current Clal policyholders who purchased private health insurance policies that expand the insurance coverage to include preventive surgery from Clal Insurance and/or from anyone on its behalf until February 1, 2016, and for which they paid excessive premiums from the date the extended policies were marketed and until the collection stops and/or until a final and irreversible ruling is made on the class action lawsuit.	Status / additional details The proceeding is at the stage of the motion to certify being reviewed.	The plaintiff estimates that the aggregate damage caused to the class members is over NIS 2.5 million.

	Date and	Defendants
14.	court 10/2022 District Court - Lod	Clal Insurance	Key claims and causes of action The lawsuit concerns the allegation that Clal Insurance's modus operandi is automatic renewal of home insurance policies while raising the insurance premiums from year to year, without obtaining the policyholder's consent.	Key remedies The main remedies sought in the lawsuit are, inter alia, to issue a declaratory order according to which Clal Insurance acted unlawfully, to order Clal to refrain from automatic policy renewals and/or policy renewals at less favorable conditions, and to compensate the class members for the damage they incurred, with interest and linkage.	Represented class The class the plaintiffs seek to represent is all of the respondent's customers, whose home insurance policy the respondent had extended without their consent, and/or all of the respondent's customers who were charged insurance premiums for a home insurance policy without their consent (including Clal Insurance's customers whose insurance premiums were raised without their consent when the policy was renewed), in the period starting 7 years before the claim was filed and to date.	Status / additional details The proceeding is at the stage of the motion to certify being reviewed.	Claimed amount The plaintiffs estimate that the aggregate damage caused to the class members exceeds NIS 3 million.

	Date and
15.	court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details	Claimed amount
	11/2022 Regional Labor Court - Tel Aviv	Clal Pension and Provident Funds	The lawsuit mainly concerns the allegation that Clal Pension and Provident Funds unlawfully charges insurance premiums due to insurance grace periods (a payment for insurance coverage when regular contributions to the pension fund are suspended) by making deductions out of the accrual, thereby reducing the accrual, without informing the planholders in advance and allowing them to exercise their right to waive the coverage, as well as that it refuses to return the insurance premiums when it learns that the planholder was insured by another pension fund.	The main remedies sought within the lawsuit are a refund of the insurance premiums paid by the class members during the insurance grace periods, and compelling Clal Pension and Provident Funds to notify planholders of the insurance grace period's commencement, the insurance premium rates, and the options available to them, in advance.	The represented class is all planholders (past and present) whose pension fund, which is managed by Clal Pension and Provident Funds, became subject to an insurance grace period arrangement without them being notified in advance, and thereby denying their right to choose not to allow the said arrangement to take effect. With respect to monetary remedies, the represented class is all planholders who did not continue to make contributions to their pension funds after the insurance grace period had ended and did not seek to extend the insurance arrangement, as well as all the planholders who opened an additional pension fund and paid double insurance premiums, in the seven years prior to submitting the motion to certify and until a judgment is rendered in the lawsuit.	The proceeding is at the stage of the motion to certify being reviewed. In February 2024, the Commissioner's position was submitted, which states, inter alia, that the extension of the insurance is activated automatically upon the cessation of contributions to the fund and that the management company must notify the planholder of the cessation of the planholder's deposits.	As a conservative estimate, the class action claimed amount is estimated by the plaintiff at no less than NIS 2.5 million per year and at approx. NIS 17.5 million in total for the seven years preceding the date of filing the motion to certify.

16.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details	Claimed amount
	12/2022 District Court - Lod	Clal Insurance	The lawsuit concerns the allegation that in the event of damage caused by a trailer and a towing vehicle, Clal Insurance (as the insurer for either the trailer or the towing vehicle) refuses to pay for the full damage caused to a third party, as it has undertaken to pay in the policy, and pays only half of it, on the grounds that the liability for damage caused by a trailer or by a towing vehicle must always be divided equally between them.	The main remedies sought in the lawsuit are a monetary remedy that includes, inter alia, compensation for the deductible paid to the other insurer, a refund of the premium to the policyholders, a mandatory injunction ordering Clal Insurance to indemnify the third parties for the full damage caused in the context of an applicable policy, and a duty of disclosure with respect to new policies that have not yet been issued.	The represented class is all Clal Insurance policyholders who purchased a trailer and/or towing vehicle third-party insurance and/or compulsory insurance policy in the 7 years preceding the submission of this motion; or, alternatively or in addition: all Clal Insurance policyholders who purchased a trailer and/or towing vehicle third-party and/or compulsory insurance policy from it, who had to pay a double deductible for a single incident of damage caused to a third party and/or who were forced to pay out of pocket for half or part of the damage caused to the third party.	The proceeding is at the stage of the motion to certify being reviewed.	The plaintiffs estimate that the aggregate damage caused to the class members exceeds NIS 2.5 million.
17.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details	Claimed amount
	01/2023 Regional Labor Court - Tel Aviv	Clal Insurance	The lawsuit concerns the allegation that Clal Insurance unlawfully reduced the insurance benefits to which policyholders suffering from a permanent health are entitled, without obtaining the policyholders' explicit prior consent and in breach of the provisions of the policy and the Capital Market Authority's instructions, as well as in breach of the duty of disclosure, while committing deception and without sending the policyholders any notice or alert of the need to pay an additional premium or reduce the insurance coverage. It was also argued that the monthly benefits paid to policyholders who have insurance coverage for permanent health were reduced or will be reduced in the future, due to the premium increase as the policyholders grow older.	The main remedies sought in the lawsuit are a declaratory relief that prohibits Clal Insurance from reducing the insurance benefits for permanent health without obtaining the policyholder's explicit written consent, and a monetary remedy that requires Clal Insurance to pay the class members who suffered a permanent health event the difference to make up the insurance benefits amount.	The represented class is: with respect to the future arrangement – all Clal Insurance policyholders who have permanent health insurance and for whom, according to Clal Insurance, the insurance coverage rate is reduced or will be reduced in the future due to an increase in the premium as they grow old; and with respect to the monetary remedies – all past and present class members who had an insured event, and their insurance benefits were reduced by Clal Insurance without the policyholder's explicit, active, and prior consent.	The proceeding is at the stage of the motion to certify being reviewed.	The plaintiff conservatively estimates the aggregate damage to all class members at NIS 18 million in the 3 years preceding the lawsuit filing date.

82- 2

18.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details	Claimed amount
	03/2023 District Court - Tel Aviv	Clal Insurance	The lawsuit concerns the allegation that Clal Insurance has an improper and illegal practice whereby it partially repays the appraiser's fees to the injured parties, without justification, and without explaining why the fees were reduced.	The main remedies sought in the lawsuit are a monetary remedy according to the gap between the fees the class members paid the appraisers and the payment made to the class members as insurance benefits for this component (hereinafter - the "Pecuniary Damage"), as well as damages for non-pecuniary damage in the amount of 20% of the pecuniary damage to all class members.	The represented class is any injured party, policyholder, or third party, who is entitled to be reimbursed by Clal Insurance for appraiser's fees the injured party paid to an appraiser in order to assess the damage to the injured party's vehicle, if Clal Insurance did not transfer the full amount the injured party paid for the appraiser's fees to the injured party.	The proceeding is at the stage of the motion to certify being reviewed.	The plaintiff estimates that the aggregate damage the class members incurred exceeds NIS 2.5 million.

	Date and
19.	court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details	Claimed amount
	03/2023 District Court - Tel Aviv-Jaffa	Clal Insurance	The lawsuit concerns the allegation that the defendants refuse to finance the policyholders' medical cannabis purchase expenses, which, according to the plaintiffs, is contrary to the provisions of policies that offer coverage for pharmaceuticals that are not included in the Healthcare Services Basket (hereinafter - the "Policies"), and the fact that medical cannabis has recognized medical uses in Western countries.	The main remedies sought in the lawsuit are, inter alia, a declaratory relief stating that Clal Insurance must reimburse the policyholders for their medical cannabis purchase expenses; to order Clal Insurance to contact all their eligible policyholders in recent years and actively invite them to demand the indemnification they deserve; and also, to require Clal Insurance to reimburse all class members for the economic damage they suffered due to their improper conduct and due to a breach of the insurance contract.	The class that the plaintiffs seek to represent is any policyholder of Clal Insurance under the Policies and who did not receive reimbursement for their medical cannabis purchase expenses.	The proceeding is in the stage of the class action certification motion being reviewed.5	The plaintiffs estimate the total claimed amount for all class members at approx. NIS 13.5 million.

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 decided in favor of consolidating the Earlier Proceedings, and accordingly, the plaintiffs filed this proceeding in March 2023.

20.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details	Claimed amount
	05/2023	Clal Pension and Provident Funds	The lawsuit concerns the allegation that when receiving a planholder's request for a disability annuity, the pension fund does not check whether the planholder requires long-term care and/or if the planholder's condition has deteriorated in a way that made the planholder require long-term care, and as a result, the fund does not pay eligible planholders the additional long-term disability annuity.	The main remedies sought in the lawsuit are to pay the class members the additional long-term care disability annuity; compensation and/or restitution for not making full contributions to the fund and for yield losses class members incurred as a result of the above non-payment; obligating the fund to give the fund's physicians accurate instructions in connection with examining conditions that require long-term care when reviewing requests for a disability annuity.	The represented class includes policyholders in "Clal Pension" and "Clal Supplementary Pension" funds who have disability insurance coverage, who are insured with a pension fund and are entitled to a disability annuity, and who, due to their medical condition on top of their permanent health, require long-term care, and the pension fund did not supplement monthly payments for policyholders who, in addition to having a disability pension is a patient requiring long-term care.	The proceeding is at the stage of the motion to certify being reviewed. An amended class action certification motion was submitted in November.	According to the plaintiff, the class action claimed amount cannot be estimated; however, for the purposes of the fee, it was put at no less than NIS 2.5 million per year and approx. NIS 18.75 million in total for the seven years preceding the date of filing the motion to certify.

	Date and
22.	court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details Claimed amount
	06/2023 Regional Court - Haifa	Clal Insurance	The lawsuit concerns the allegation that following the economy-wide extension order regarding the increase in pension insurance contributions in 2016 (hereinafter - the "Extension Order"), which concerns an increase in the pension insurance contributions employers are required to make for their employees (hereinafter - the "Increased Contributions"), Clal Insurance opened new executive insurance policies (hereinafter - the "Contribution Policies") for its policyholders who had had old executive insurance policies that had been issued before May 31, 2001 (hereinafter - the "Old Policies"), while the annuity conversion factors set for the Contribution Policies were not guaranteed and were less beneficial than the guaranteed annuity conversion factors in the Old Policies, and redirected the additional funds from the Increased Contributions into the Contribution Policies, without the policyholders' consent.	The remedy the plaintiff is petitioning for is to close the Contribution Policies and transfer the contributions made thereto, as well as future contributions originating from the Increased Contributions, to the Old Policies, or, alternatively, to set beneficial factors for the Contribution Policies, at the discretion of the court; to pay the people who are already being paid a pension out of the Contribution Policies the difference between the amounts they would have received if the Increased Contributions funds had all been deposited into the Old Policies (or the amounts they would receive due to beneficial factors, at the discretion of the 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.	The class the plaintiff seeks to represent is anyone for whom Clal Insurance had managed an executive insurance policy issued before May 31, 2001, and for whom, after June 30, 2016, it managed (in a new insurance policy) the funds received due to them for the Increased Contributions, or the beneficiaries or heirs of any such person.	The proceeding is at the stage of The claimed amount - the motion to certify being The plaintiff reviewed. conservatively estimates the In June 2024, the Court ordered aggregate damage to all to ask for the regulator's position class members to be in in connection with this the millions of shekels. proceeding; the Court also ordered the parties to agree the questions that will be referred to the regulator.

	Date and
23.	court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details	Claimed amount
	06/2023 District Court - Tel Aviv-Jaffa	Clal Insurance, Clal Pension and Provident Funds and 4 additional companies	The lawsuit concerns the allegation that the defendants ought to have refrained from deducting tax out of the portion of the annuity equal to the annuity recipients' "recognized annuity" in the pension products they manage, and apply a tax exemption due to that component, which would have resulted in higher annuity payments to the class members.	Repayment of the funds deducted as tax out of the "recognized annuity" portion of the annuity to the class members.	The class the plaintiff seeks to represent is any individual who is paid an annuity from one of the new pension funds and/or the provident funds and/or the insurance funds managed by any of the respondents, who was entitled to a tax exemption on their annuity in respect of their "recognized annuity" component, as this term is defined in the Income Tax Ordinance, and did not receive the above exemption, as of January 1, 2012, and thereafter.	The proceeding is at the stage of the motion to certify being reviewed. At the same time as submitting the answer to the motion to certify the claim as a class action, the respondents submitted a motion for permission to send a third-party notice to the Israel Tax Authority. In its response to the third-party notice, the Israel Tax Authority rejected the arguments made therein and argued, among other things, that it should be added as a respondent to the proceeding rather than as a third party. The parties are considering entering into a mediation proceeding in this lawsuit.	The plaintiff estimates the aggregate damage to all class members at approx. NIS 297 million, for all class members who are paid annuities from the defendants, without attributing a specific monetary remedy to each defendant.

24.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details	Claimed amount
	08/2023 District Court - Central - Lod	Clal Insurance	The claim concerns the contention that in insurance policies marketed by Clal Insurance, in a plan of the type "self defense" and/or any other marketing name, Clal Insurance was asked in the insurance registration form (the insurance offer) to insure its policyholders under an insurance plan that includes several forms of insurance coverage, including insurance coverage for perpetual disability due to accident, yet in practice it issued policyholders different and inferior insurance coverage of the type "loss/impairment of functioning".	Provision of a mandatory injunction pursuant to which Clal Insurance is required to update the insurance policies with insurance coverage of the type perpetual disability due to accident, required to provide the class members with insurance coverage in respect of perpetual disability due to accident, and charged with special interest.	All Clal Insurance policyholders with health-insurance policies within the "self defense" plan, and/or any other marketing name, issued by Clal Insurance with insurance coverage of the type "loss/impairment of functioning" in contradiction of the statements in the insurance offer form, which noted insurance coverage of the 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.	The proceeding is at the stage of the motion to certify being reviewed.	The plaintiff estimates that the aggregate damage the class members incurred exceeds NIS 2.5 million.
25.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional 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	The remedies sought are, among other matters, compensation in respect of reimbursement of premium payments, towing costs, and non-pecuniary damages	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	The proceeding is at the stage of the motion to certify being reviewed.	The plaintiff estimates the aggregate damage to all class members at approx. NIS 80 million.

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).

("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.

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.

86-2

26.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details	Claimed amount
	11/2023 District Court - Tel Aviv	Clal Insurance and 7 additional insurance companies	The lawsuit concerns the claim that when setting the price of premiums in life, health, and P&C insurance policies, "catastrophe events" such as a "surprise" war and/or other extreme or unexpected events that reduced the defendants' risk and exposure were not factored in; that in light of the Iron Swords War, the defendants are expected to experience a major reduction in the risk in policies in which the risk-weighted components had significantly decreased (and completely eliminated in some cases).	The remedies sought are declaratory relief, a mandatory injunction, reimbursement or reduction of the premiums from the date of declaration of a state of emergency, and pecuniary and non-pecuniary monetary compensation.	The petitioners define five classes in the claim. (1) Policyholders some of whose policies contain a war exclusion that excludes insurance coverage of an insured event in wartime, but, in light of their call-up for reserve military service, the actuarial risk in connection with whom has decreased, and accordingly, action should be taken to reimburse and/or reduce the premium; (2) policyholders of the respondents, mainly in the area of P&C insurance, who, due to the declaration of a state of emergency and the transition of government institutions, public bodies, and dual-purpose bodies to an emergency work format, will be unable, or able in a partial and limited manner, to exercise the insurance service 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 bodies, and dual-purpose bodies 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.	The proceeding is at the stage of the motion to certify being reviewed.	The plaintiff estimates that the aggregate damage the class members incurred exceeds NIS 2.5 million. With regard to policyholders called up for reserve duty, it is argued that the estimated damage is in the amount of NIS 10.02 million (with respect to all of the defendants).

27.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details Claimed amount
	12/2023 Regional Labor Court - Haifa	Clal Pension and Provident Funds	The action involves the claim that the defendant unlawfully collects insurance premiums in the comprehensive pension fund under its management that are higher than those it was entitled to collect, while reducing the amount of the accrual of the fund's planholders: (a) when receiving retroactive contributions - insurance premiums are collected that are higher than the insurance premiums that the defendant was supposed to collect; (b) as a result of attributing "insured income" that is higher than the planholder's salary when the rate of contribution for rewards was more than 11.5% of the planholder's salary and less than 13%; (c) as a result of collecting insurance premiums due to the portion of the planholder's income that exceeds the monthly contribution ceiling for the pension fund stipulated in the law.	Restitution of insurance premiums that were collected from the class members plus interest and linkage differentials; A declaration on the nullity of provisions in the regulations that were in effect in the relevant years and a prohibition on the management company to carry out the actions mentioned in Sections (a) to (c) above.	The class the plaintiff seeks to represent is everyone who, during the 7 years that ended on the day the motion was submitted, was a planholder of the comprehensive pension fund of "Clal Pension," and from whom the respondent collected an insurance premium calculated on the basis of an amount greater than the maximum amount for this matter, according to the law and/or according to the fund's regulations that were in effect on the collection day, the lower of the two.	The proceeding is The class action amount is at the stage of the estimated conservatively, motion to certify according to the plaintiff, at being reviewed. millions of shekels, without specifying an amount.

28.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details	Claimed amount
	01/2024 District Court - Jerusalem	Clal Pension and Provident Funds	The action involves the claim that the defendant raised the management fees in planholders' accounts in the products managed by it without sending them any notice in advance according to the law.	Restitution of the all the amounts that were unlawfully collected from each of the class members together with the returns that said funds would have yielded in the accrued savings.	The class the plaintiff seeks to represent is all planholders of provident funds and/or study funds and/or pension funds and/or any 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 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 the class action (District Court - Jerusalem) 15-03-59823 Yair Zedkani v. Clal Pension and Provident Ltd. (December 13, 2018).	The proceeding is at the stage of the motion to certify being reviewed.	The claimed amount is estimated by the plaintiff at more than NIS 2.5 million.
29.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details	Claimed amount

The action involves the claim that the defendant charged management fees at a rate that exceeds the rate	Restitution of the all the amounts that were unlawfully collected from each of the class members together with the returns	The class the plaintiff seeks to represent is all planholders of provident funds and/or study funds and/or pension funds and/or any 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
permitted by law, in the	that said funds would have	deceased planholders and/or their beneficiaries, from whom
accounts of planholders	yielded in the accrued	management fees were collected at a rate higher than the maximum rate
with whom contact has	savings.	stipulated in Regulation 8 of the Supervision of Financial Services
been lost or in the		Regulations (Provident Funds) (Management Fees), 2012, during the
accounts of deceased		period beginning on January 1, 2013, (the date of entry into force of the
planholders.		aforementioned regulations) and ending with a final and decisive ruling
		in the action.

30.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details	Claimed amount
	05/2024 District Court - Tel Aviv	Clal Insurance	The lawsuit concerns the allegation that the defendant offered retired policyholders in the "Hassneh" policies an annuity track that guarantees a higher number of annuities than the annuity track they would have been entitled to according to the terms and conditions of the policy, in a manner that has reduced the total annuity that the policyholders received.	To allow all class members to retroactively choose an annuity track in accordance with that said in the policy (as alleged), and to pay anyone who chooses this the difference between the amount that the policyholder would have been entitled to according to the terms and conditions of the policy and the amount actually paid by the defendant, plus linkage differentials and interest.	The class that the plaintiff seeks to represent consists of policyholders who hold an executive insurance policy issued by "Hassneh" and that is managed by the defendant, who chose a different annuity track from the track set out in the policy or who chose to receive their accrued balance in the policy as a lump sum.	The proceeding is at the stage of the motion to certify being reviewed.	The plaintiff estimates the aggregate damage to all class members at approx. NIS 900 million.

31.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional 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.	As part of the motion it is requested to define three groups in the name of which the lawsuit will be filed: The group 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; the group 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; the group 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 is estimated by the plaintiff at more than NIS 2.5 million.

32.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional detailsClaimed 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.	The class that the plaintiff seeks to represent consists of all those who meet one or more of the following conditions (hereinafter - the "Class Members"): (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 The claimed amount at the stage of is estimated by the the motion to plaintiff at more than certify being NIS 2.5 million. reviewed.

33.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details	Claimed amount
	07/2024 Regional Court - Haifa	Clal Insurance and additional defendants	The lawsuit concerns the claim that the defendants unilaterally change the expiry date of the policy period in permanent health insurance policies of the classes members to reflect the policyholder's "insurance age", which varies from their calendar age, without disclosure as required by law, and consequently, among other things, the insurance benefits to policyholders, who experienced the insured event, are not paid until the end of the policy period they selected as part of the insurance offer, but rather until an earlier date. Furthermore, policyholders who have not yet experienced the insured event are at risk that if they experience an insured event in the future, they will receive insurance benefits by a date, which is earlier than the end of the policy period, which they selected as part of the insurance offer.	(a) Declaratory relief whereunder the policy period of permanent health insurance policies purchased by the classes members ends at the earlier of the end of the calendar policy period as requested by the policyholder or on the calendar retirement age prescribed by law (hereinafter - the "Calendar Date"), and accordingly issue a mandatory injunction requiring the defendants to extend the insurance coverage period of the permanent health insurance of classes members, such that the insurance coverage will end on the Calendar Date. The plaintiffs also request a declaration to the effect that failure to pay the insurance benefits to Class B members by the Calendar Date constitutes a breach of the policy; (b) Pecuniary remedy - pay Class B members insurance benefits through the Calendar Date plus linkage differences and interest; (c) Compensation in respect of the non pecuniary damage totaling NIS 100 to each of the classes members.	The classes the plaintiffs seek to represent are: (a) Policyholders insured under a policy, which includes permanent health insurance coverage, whose insurance coverage period will end before the calendar age noted by the policyholders in the insurance offer, or before the calendar retirement date prescribed by law, and have not yet experienced an insured event; and (b) past or present policyholders insured in a policy, which provides a permanent health insurance coverage, who experienced an insured event during the period they noted in the insurance offer, or during the period prescribed by law (in accordance with the policyholder's calendar age), but were not paid insurance benefits through the end of the policy period, which was requested or prescribed as described above in the 7 years before the lawsuit's filing date.	The proceeding is at the stage of the motion to certify being reviewed.	The claimed amount is estimated by the plaintiff at more than NIS 2.5 million.

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

1.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details	Claimed amount
	8/2016 Regional Court - Tel Aviv (1) 10/2016 Regional Labor Court - Jerusalem (2) 11/2016 Regional Court - Jerusalem (3) 12/2016 Regional Court - Tel Aviv (4)	Clal Pension and Provident Funds and Clal Insurance	The lawsuits concern the allegation that in the pension funds, the Tamar Provident Fund, the study funds under their management, and their executive insurance policies, the defendants charge planholders – in addition to the management fees – "investment management expenses" (hereinafter - "direct expenses"), in the absence of a contractual provision that allows them to charge such expenses and contrary to the bylaws of the respective funds or policies, as applicable.	The plaintiffs in the lawsuits seek to compel the defendants to return the excessive direct expenses amounts they were charged. In addition, some of the plaintiffs have motioned to charge some of the defendant management companies for the return differences the overcharge amounts would have provided had they been invested, while others wish to charge the defendants shekel denominated interest differences, as per the law, from the overcharge date to the actual payment.	The planholders in the pension funds, the study fund, the provident fund "Clal Tamar" managed by the defendants, and the policyholders of executive insurance policies who were charged investment management expenses in the seven years before the relevant lawsuit was filed.	In May 2019, the Central District Court rendered a ruling granting the motion to certify a class action lawsuit due to the collection of Direct Expenses in individual life insurance policies (hereinafter - the "Certification Ruling"). In the Certification Ruling, it was determined that the absence of a clear provision in the policy regarding the collection of direct expenses is a negative arrangement, and therefore, the defendants were not prohibited from charging these expenses. In September 2019, a motion for leave to appeal the Certification Ruling was brought to the Supreme Court (hereinafter - the "Motion for Leave to Appeal"). The Group Companies were not originally a party to that proceeding. In June 2023, the Supreme Court rendered its decision after hearing the motion for leave to appeal as an appeal, and granted the appeal on the Certification Ruling, while stating that insurance companies and management companies act as trustees for the planholders' funds and are therefore entitled to collect expenses. Subsequently, the parties submitted supplemental arguments. In March and April 2024, consensual motions for withdrawal were submitted without a costs order in all proceedings. [For details on a similar proceeding being adjudicated against "Atudot" – Pension Fund for Workers and Independent Workers, which has not yet been resolved, see Section 2.1.2.2 above].	In Lawsuit 1, which concerns the pension funds, the class action claimed amount was approx. NIS 341 million in respect of the years 2009 to 2015, plus the investment management expenses the defendant had collected from the class members in 2016 and the additional yield the funds that have been deducted as investment management expenses would have yielded. In Lawsuit 2, which concerns the study fund, the class action claimed amount was set at approx. NIS 53 million, based on an assessment. In Lawsuit 3, which concerns the Tamar Provident Fund, the class action claimed amount was set at approx. NIS 181 million, based on an assessment. In Lawsuit 4, which concerns the executive insurance policies, the class action claimed amount was set, according to an estimate, at approx. NIS 404 million, plus the investment management expenses that the defendant had charged to the class members in 2016, with interest and linkage.

^6. Not including lawsuits that concluded in the reporting year, but that were reported to have been concluded in the Financial Statements for 2023.

	Date and
2.	court 11/2018 District Court - Central	Defendants Clal Insurance	Key claims and causes of action According to the plaintiffs, Clal Insurance is in breach of its contractual obligation under the policy, as it allegedly refuses to pay its policyholders under comprehensive motor insurance policies for vehicles that weigh over 3.5 tons benefits for their vehicles' impairment due to an insured event, even though the policy covers the "damage" to the vehicle, and while manipulating the assessments issued by the appraisers under the arrangement.	Key remedies A declaratory relief and a motion to compel Clal Insurance to indemnify all its policyholders who were insured under the policy and whose vehicles were and/or will be damaged due to impairment as a result of an insured event, as well as any other remedy that the court deems suitable and equitable under the circumstances.	Represented class All Clal Insurance policyholders who purchased and/or will purchase a comprehensive motor insurance policy from Clal Insurance for a vehicle that weighs over 3.5 tons, if, as a result of an "insured event," as defined in the policy, their vehicle was and/or will be damaged due to an impairment.	Status / additional details Claimed amount In June 2024, the court The plaintiff estimates allowed a motion for the total damage to the approval of a settlement class members at agreement, under which approx. NIS 75 million. the defendant will pay the The plaintiff's individual class members an amount damage was estimated agreed upon by the parties at NIS 21,605. and will also send a clarifying letter to the external appraiser.
3.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details Claimed amount
	4/2020 District Court - Central	Clal Insurance, 4 other insurance companies, and another non-insurance company	According to the plaintiffs, the defendants allegedly provide their customers with non OEM windshields that do not comply with the Israeli standards mark, in contrast with their undertakings toward their customers in accordance with their agreements with them.	Monetary damages to all customers whose vehicles have had a replacement windshield installed, which would allow them to replace the windshield installed in their vehicle with an OEM windshield; NIS 500 in monetary damages per each such customer for the trouble of carrying out the replacement; refund for the price difference between an OEM windshield and a non-OEM windshield.	Every customer of the defendants, who has held or holds a cover note in which any one of the defendants has made an undertaking to provide the customer with an Israeli standard compliant replacement windshield or an OEM windshield, as well as any of the defendants' customers who have held or holds a cover note under which any of the defendants undertakes to supply the customer with an Israeli standard-compliant replacement windshield or an OEM windshield, who has been supplied with a non-OEM and non-Israeli standard-compliant windshield.	In July 2024, the Court The plaintiffs do not dismissed the class action quantify the total certification motion. damage they are claiming for all class members they seek to represent, but they estimate that it greatly exceeds NIS 2.5 million.

4.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details	Claimed amount
	12/2017 District Court - Jerusalem	Clal Insurance, two other insurance companies, Clalit Health Services, and Maccabi Healthcare Services.	According to the plaintiffs, the defendants allegedly refuse to provide long-term care insurance to people on the autistic spectrum, or set impossible and unreasonable conditions for them, without providing any explanation or justification for their conduct.	Making a declaratory order that the defendants' conduct violates Article H of the Equal Rights of People with Disabilities Law, 1998, the Equal Rights for People with Disabilities Regulations (Insurer's Notice Regarding Different Treatment of a Person or Refusal to Insure) (2016) (hereinafter - the "Equality Law"), and other statutes; issuing a mandatory injunction compelling the defendants to stop discriminating against the class members and establish clear work procedures regarding individual, egalitarian, and impartial treatment of people with disabilities; issuing mandatory injunction compelling the defendants to retroactively insure the class members who are found eligible for long-term care insurance after an egalitarian underwriting procedure is carried out in accordance with the procedures, as said above.	People with autistic spectrum disabilities who applied for insurance under a long-term care insurance policy offered by any of the defendants, and were unlawfully treated differently and discriminated against by the defendants, without the defendants basing the ruling on reliable and relevant statistical, actuarial, or medical data on the specific insurance risk, and/or were not given an explanation for this, as required under the Equality Law and other applicable statutory provisions, in the seven years prior to bringing the motion to certify.	In February 2023, the court rendered its judgment, in which the motion to certify was denied. In July 2024, the plaintiffs have withdrawn an appeal against the judgment, which they filed in April 2023.	The plaintiffs do not quantify the damage to all class members, and they estimate the plaintiffs' individual damage at tens of thousands of shekels per plaintiff.

5.	Date and	Defendants	Key claims and causes of action		Represented class		Claimed amount
	court 5/2011 District Court - Central	Clal Insurance and additional insurance companies	According to the plaintiff, in combined life insurance and savings policies, the defendants charged policyholders – without consent and without any justification originating from the policies – sums of money that sometimes comprised a considerable rate of the premiums the policyholders paid, known as the "policy factor" and/or "other management fees" (hereinafter - "Policy Factor"), unlawfully and without this being grounded on any suitable contractual provision, even though the defendants were, in principle, allowed to charge the Policy Factor in life insurance policies in accordance with the Commissioner's circulars.	Key remedies Payment of an amount equal to the Policy Factor that was actually collected from the class members as damages/recove ry, in addition to the yield the policyholders had been denied with respect to this amount because the Policy Factor amount deducted from the premium had not been invested for them, and a change in the modus operandi regarding the collection of the Policy Factor.	Anyone who had a combined life insurance and savings policy with any of the defendants and from whom any amount was collected as a Policy Factor.	Status / additional details In June 2015, a motion to approve a settlement agreement was brought to the court, according to which, the defendants were supposed to pay a total of NIS 100 million in respect of the past (Clal Insurance's share of the above being approx. NIS 26.5 million) and give a 25% discount on the future actual collection of the Policy Factor. In November 2016, the court decided to dismiss the motion to approve the settlement agreement, as it did not constitute a proper, fair, and reasonable arrangement in the court's opinion, considering the class members' interests. In addition, the court decided to partially certify the lawsuit's administration as a class action, only with respect to combined life insurance and savings policies made between 1982 and 2003 (with respect to Clal Insurance policies in the "Adif," "Meitav" and "Profile" categories), in which the savings accrued in favor of the policyholders were diminished due to the collected Policy Factor, with the cause being a breach of the insurance policy due to collecting the Policy Factor in a manner that diminished the savings the policyholders accumulated, in respect of the period starting seven years before the date of filing the claim, in April 2011. The claim has not been approved with respect to other types of policies. The claimed remedies, as defined in the court's Ruling, are to rectify the breach by way of adjusting the policyholders' accumulated savings according to the amount of the additional savings they would have accrued had they not been charged a Policy Factor or to compensate the policyholders by that amount, as well as to cease charging the Policy Factor from that date on. In addition, the defendants were charged the legal fees payable to the lead plaintiffs' counsel and to the counsel of parties who were opposed to the settlement arrangement and their counsels, at immaterial amounts. The defendants filed a motion for leave to appeal the court's ruling and withdrew it at the suggestion of the Supreme Court. Within the litigation of the proceeding on its merits before the District Court, the parties conducted mediation proceedings. In June 2023, the parties submitted a settlement arrangement for approval by the court, in which a refund mechanism was set for the class members who owned combined life insurance and savings policies made between 1982 and 2003, in which the accumulated savings to their benefit were affected due to the collection of the Policy Factor. According to the settlement arrangement, the main consideration to the class members would be as follows (in accordance with the provisions of the settlement arrangement): The Company would refund the class members for 42% of the total collected Policy Factor that was allegedly supposed to be transferred to the savings component but was not, starting seven years before the motion to certify was brought until the reduced collection start date, as stated in Subsection 2 below. In relation to the period until the end of 2012, the amounts were to be repaid with returns, and with respect to the period from the beginning of 2013 and onward, the amounts would be revalued in accordance with the court's ruling, by virtue of the authority granted to the court by the parties (hereinafter - the "Supplementary Ruling"). It was also agreed that, under the settlement agreement, Clal Insurance paid the plaintiffs and their counsel the reward and legal fees. The Company would reduce the future Policy Factor collection from the relevant class members, by lowering the Policy Factor collection to 50% of the total Policy Factor that would have been collected had no reduction been made, as stated in the settlement arrangement. According to Clal Insurance's initial assessment, the total Policy Factor reduction with respect to future collection is expected to sum up to approx. NIS 3 million for 2024. The above reduction amounts are expected to be reduced over the years. In May 2024, the Attorney General submitted her position regarding the settlement agreement, whose highlights are that she does not object to the total compensation to the benefit of the class members, as agreed upon in the settlement agreement, provided that the refunded amounts also include the returns from 2013 (contrary to that stated in the settlement agreement, under which the revaluation of the amounts from 2013 is subject to a supplementary court decision).	The plaintiffs' claim is in respect of the Policy Factor they were charged since 2004. According to various estimates and assumptions the plaintiffs made with respect to the collection of the Policy Factor in the seven years preceding the date the defendants filed the claim and the relevant annual returns, the plaintiffs estimated the amount of the class members' claim against all the defendants, as of the date of filing the claim, at a nominal amount of approx. NIS 2,325 million. Out of this amount, approx. NIS 662 million are attributable to Clal Insurance, according to its alleged market share.

94-2

5.	Date and		Key claims and		Represented
(cont.)	court	Defendants	causes of action	Key remedies	class	Status / additional details In addition, the Attorney General did not object to the manner of future regulation and the continued reduced collection of the policy factor. However, the Attorney General believes that the reduced cost of the policy factor should apply only to savings (and not be divided between the savings component and the life insurance component, as proposed in the settlement agreement). In addition, the position includes objections and commentary on other components of the settlement agreement, including with respect to the attorney's fees to be paid to the counsel for the plaintiffs and	Claimed amount
						the manner of implementing the settlement agreement. In June 2024, the Attorney General's position regarding the settlement agreement was discussed; following the discussion, in July 2024 the parties filed to the court an agreed supplement to the settlement agreement in connection with several technical operational topics.
						In August 2024 the court approved the settlement agreement after it set various provisions in connection with its implementation, including, among other things, in relation to the Attorney General's position. As part of the judgment, the court ruled that the revaluation of the refund amounts in the period from 2013 and onward (the "Supplementary Ruling" as defined above) shall include 90% of the returns in the period from the beginning of 2013 through the reduction date, and approved the fee payable to the class's counsel in accordance with the rates set in the settlement agreement.

	Date and		Key claims and		Represented
6.	court 3/2019 District Court - Jerusalem	Defendants Clal Insurance	causes of action According to the plaintiffs, the defendant issues personal accidents policies to policyholders when the latter purchase travel insurance policies, without obtaining their consent and while misleading them.	Key remedies An order to pay back the funds collected by the defendant to each class member, due to payments for a personal accidents policy, in the last seven years	class Any policyholder who, while purchasing a travel insurance policy, was simultaneously, without their consent, enrolled in a personal accidents insurance, and was unlawfully charged monthly premium payments, in the period starting up to 7	Status / additional details In December 2020, the parties filed with the Court a motion to approve a settlement agreement. In January 2023, in accordance with the court's position, the parties submitted a revised settlement agreement to the court, according to which, a certain refund would be made out of the paid premiums, at the rate the parties had agreed on, to the policyholders who had purchased a personal accidents policy in conjunction with the travel insurance and who canceled the personal accidents policy during the period specified in the settlement. A judgment was rendered in October 2024, which approves the amended settlement agreement, with immaterial amendments.	Claimed amount The plaintiffs estimate the total damage to the class members at approx. NIS 17 million. The total personal damage being claimed is NIS 1,044.

					years prior to the day the lawsuit was filed.

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 8(2.1.1), the pending motions to certify material lawsuits as class actions, described in Note 8(2.1.2), and the motions to certify material lawsuits as class actions that were dismissed in the reporting period, described in Note 8(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, 7 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 113 million8 (compared to 7 lawsuits for approx. NIS 140 million as of December 31, 2023).

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 might result in disputes arising regarding the interpretation of provisions of the Law or an agreement, including as a result of information gaps between the Group's companies and third parties, 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 stop implementing an insurance plan, or to order it to make changes to an insurance plan, including in relation 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 might 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 might 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 might 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 industry-wide rulings made by the Commissioner.

^7. See Comment 3 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 might 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 might 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 might 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 might 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 might 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, might 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.

It should be noted that insofar as this involves a customer complaint submitted to the Public Inquiries Unit in the regulator's office, in addition to the risk that the customer might opt to raise its claims also as part of a class action lawsuit, the Group's member companies are also exposed to the risk that the regulator could resolve a complaint by issuing an industry-wide ruling that might apply to a broad group of customers. In recent years, there has been a considerable increase in exposure to the aforementioned risk, owing to the regulator's increasing intervention via audits, addressing customer complaints received by the Authority, including in light of the fact that, from time to time, the regulator tends to lay down a principled positions via industry-wide rulings, position papers and even draft position papers published by it, as well as in the form of operational directives issued within audit reports. 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 might expand the Group's exposure to the industry-wide implications in respect of the said defects.

2.2.3.2Exposure 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 8(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 might 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 might have an impact on the Group:
- 1. In the past, the Company held discussions with the Commissioner in respect of a draft ruling, dealing with one-time deposits of policyholders in guaranteed return policies (hereinafter - the "Policies"). Pursuant to the draft, the Company is required to adopt certain actions with respect to policyholders whose actual return on one-time deposits, bearing the returns of yield-dependent insurance policies, was either equal to or greater than the guaranteed return in the Policies, and certain actions in respect of policyholders whose actual one-time deposit return was lower than the guaranteed return. Therefore, at this stage, in light of the fact that the final wording of the ruling is not known, if and insofar as it is made, the Company will not be able to estimate the ramifications and the extent of its impact on the Company, if and insofar as it shall be published.
- 1. 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 in relation 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 to address other issues was devised, 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 Demand for information from the Competition Authority against Hyp

Further to Note 45(2)(4) to the Consolidated Financial Statements for 2023 regarding the demand for data and request for an examination of conduct that raises concerns of a breach of the provisions of the Economic Competition Law, 1988, regarding the interface of new acquirers received by Hyp Payment Solutions Ltd., a sub-subsidiary of the Company (hereinafter - "Hyp"), Hyp took steps designed to resolve any dispute regarding this matter; furthermore, as part of a review by the Israel Competition Authority, Hyp received several other demands for data from the Israel Competition Authority, which it responded to, and conversations and meetings were conducted between the parties. To the best of the Company's knowledge, to date the Israel Competition Authority has not yet issued a decision regarding the review.

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 that 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 sum 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 amount claimed 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 amount claimed usually relates to the period preceding the date of filing suit and does not include the following period.

			No. of	Amount claimed in NIS million
Type of claim	claims	(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	12	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	19	-
	4.	An annual amount was specified (and accordingly, the total amount
		depends on the period)15	1	7

^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, they do not include a lawsuit against Atudot, as detailed in Section 2.1.2.2, 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.

In addition to that specified in Sections 8(1) and 8(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 34 million as of September 30, 2024 (approx. NIS 35 million as of December 31, 2023). The causes of action within these proceedings are many and varied.

2.4.2 Regarding the Companies and the consolidated companies, except the Max Group companies, in respect of the costs that might derive from the claims and exposures described in Sections 8(1) and 8(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 might 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 might 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 8(2.1.2) (30), (31), (32), and (33) 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 September 30, 2024, for all the lawsuits and the exposures described in Sections 8(1) and 8(2) above, totals approx. NIS 463 million (approx. NIS 409 million as of December 31, 2023).

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 that were concluded during the reporting period and until its signing and other material claims.

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 follows18:

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 195 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 might greatly exceed the actual exposure. In the majority of cases, the plaintiffs point out that the sum 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 amount of the claim 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.

^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 8, 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 instructions – 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.

^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.

	Date and		Key claims and causes
1.	court 5/2019 District Court - Tel Aviv-Jaffa	Defendants Max	of action 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.	Key remedies The main remedy claimed in the lawsuit is restitution of 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.	Represented class All Max customers who entered into an acquiring agreement with it and were charged a transaction cancellation fee.	Status / additional details In April 2022, the District Court rendered its judgment, in which the motion to certify was denied. In July 2022, the plaintiff appealed the judgment to the Supreme Court. In August 2023, the Supreme Court rendered a judgment that accepted the appeal and certified the lawsuit as a class action lawsuit, holding that the class members on whose behalf the lawsuit would be litigated are all Max 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 Supreme Court) and in the cancellation fee rate chart, from whom Max charged a cancellation fee. Therefore, the case was returned to the District Court of Tel Aviv to hear the class action lawsuit on its merits. Following the above ruling, the District Court advised the parties to discuss the proceeding's continued litigation or an attempt to conclude it by way of a settlement; accordingly, mediation proceedings took place between the parties.	Claimed amount The plaintiff estimates the total claimed amount for all class members at approx. NIS 22 million.
2.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional 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	The main remedy claimed in the lawsuit is 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	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 fees they had ordered from the marketing companies and/or due to any other charge that they have not	In December 2021, the Attorney General submitted his position regarding the proceedings, according to which, under certain circumstances, it is appropriate to impose a mandate on credit-card companies, in their capacity as issuers, to intervene in a transaction executed due to improper pressure on an elderly customer by direct marketing companies. The companies objected to this position. In August 2022, the District Court rendered a judgment that denied the motion to certify. In November 2022, the plaintiffs filed an appeal against the	The plaintiffs estimate the total claimed amount for all class members at NIS 900 million.

duly authorized and/or without being given adequate consideration in the seven years prior to the

ruling with the Supreme Court.

The appeal was heard in June and July 2024.

motion to certify.

3.1.2. Pending motions to certify material claims as class actions against Max Group companies19

taking advantage of the

transactions, to compensate the customers for the nonpecuniary damage they incurred, and to terminate the engagement with the relevant companies.

elderly.

^19. Including such motions that were denied and the ruling to deny them was appealed.

3.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional detailsClaimed amount
	06/23 District Court - Tel Aviv	Max and Max IT Credit (a wholly owned Max subsidiary)	The motion to certify concerns the plaintiff's allegation that the defendants announce the end of the limited-time 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.	The main remedy sought in the lawsuit is the refund of the excessive card fee charged after the benefit expiration date without duly notifying of the 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.	The defendants' customers who were given a limited time exemption from card fees benefit, 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 proceeding is at the According to the stage of the motion to plaintiff, the amounts certify being reviewed. might sum up to tens The parties agreed to refer of millions of shekels, the proceeding to and therefore it mediation. estimates the lawsuit amount, at this stage, at over NIS 3 million.
4.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details Claimed amount
	03/2024 District Court - Tel Aviv	Max and 1 other	The motion to certify involves the claim that Bank Leumi and Max raise the card fees for their customers without a proper update. It is argued that, according to the law, the defendants have the duty to notify of changes of this type, in an effective manner, in a separate and clear notice and/or in a prominent manner that will allow the notice regarding the increase in card fees (or collection of payments) to be distinguished from other current notices. All of the above is contrary to the duties of good faith and disclosure that apply to the defendants.	The main relief sought is compensation and/or restitution of the difference between the price that the customers originally paid and the amount that was actually charged, without them being duly notified of the increase in card fees. And, in addition, a mandatory injunction instructing the defendants to actively inform their customers of any increase in the price of the service, as part of a separate and clear notice on the website, including in the application.	Any customer of the defendants, whose express consent was not given or who was not actively informed about the increase of the price of services involving the credit card prior to the increase in the price of the services, in the 7 years preceding the submission of the motion to certify and until the date of certification of the action as a class action.	The proceeding is at the The plaintiff estimates stage of the motion to the amount of the claim certify being reviewed. at over NIS 2.5 million.

Regarding a pending motion to certify a material claim as a class action lawsuit that was brought against the Company and against Max, see Note 8(2.1.2.9) above.

3.1.3. 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 Max Group companies

1.	Date and court	Defendants	Key claims and causes of action	Key remedies	Represented class	Status / additional details	Claimed amount
	6/2016 District Court - Lod Central	Max and 2 additional companies	The lawsuit concerns the allegation that the defendants are parties to an illegal cartel, in connection with debit cards and prepaid cards, whereby they charge fees at a rate that exceeds the costs associated with the transactions made using these cards, and also that even though the customer is charged immediately or shortly after the transaction date when such cards are used, the acquirer only issues a credit with respect to them later.	The main remedies sought in the lawsuit are to compensate the class for the damage arising from the alleged cartel regarding the total interchange fee paid in debit card transactions, and regarding the timing of transferring funds to merchants for debit card transactions, as well as compensation for the under-use of debit cards due to the two aforementioned cartels.	All merchants and their customers that honor debit cards.	Various proceedings seeking a declaratory remedy from the Competition Court stating that the interchange fee in debit card transactions was not heard or decided by the court, were all dismissed. In December 2023, a motion was filed to approve a settlement agreement. The key points of the agreement are that the respondents will work to deliver prepaid cards and gift cards, which will be topped-up in the amount set in the agreement - as a donation. The settlement agreement was approved by the court in August 2024.	The plaintiff estimates the total claimed amount for all class members at approx. NIS 7.1 billion.

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 raised to NIS 86 million.

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 the company NIS 180 million due to this period, plus linkage differentials 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 the company'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 September 30, 2024.

NOTE 9 - CREDIT RISK, RECEIVABLES FOR CREDIT CARD TRANSACTIONS AND CREDIT LOSS PROVISION

A. Credit and receivables for credit card transactions

In NIS million	As of September 30, 2024	As of September 30, 2023	As of December 31, 2023
	Unaudited		Audited
Credit risk without bank guarantees:
Private individuals: (1)
Of which: Receivables for credit card transactions (2)	4,491	3,803	3,451
Of which: Credit cards (2)(3)	10,014	9,297	9,127
Private individuals - total	14,505	13,101	12,578
Commercial:
Of which: Receivables for credit card transactions (2)	324	278	237
Of which: Credit cards (2)(3)	1,080	953	964
Commercial - total	1,404	1,231	1,201
Total credit risk without bank guarantees	15,909	14,331	13,779
Credit risk guaranteed by banks and others:
International credit card companies and organizations	375	311	276
Income receivable	46	127	153
Other	183	147	170
Total receivables for credit card transactions	16,513	14,916	14,378
Credit loss provision	(371)	(361)	(372)
Total receivables for credit card transactions	16,142	14,555	14,006
Receivables for credit cards guaranteed by banks	1,210	1,095	1,085
Receivables for credit card transactions, net	17,352	15,650	15,092

(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 is presented after the invoice factoring transaction. Credit - with interest, including credit transactions, revolving credit card transactions, direct credit, credit for non-card holders, and other transactions.

(3) Including credit secured by vehicles amounting to NIS 3,001 million (December 31, 2023 - NIS 2,205 million, September 30, 2023 - NIS 2,167 million).

**B. Debts* and off-balance-sheet credit instruments**

1. Change in outstanding credit loss provision

	For the three-month period ended September 30, 2024
		Credit loss provision
	Credit risk without bank guarantees
	Private individuals		Commercial
	Receivables for credit cards	Credit (1)	Receivables for credit cards	Credit (1)	Other(2)	Total
In NIS million			Unaudited
Balance of credit loss provision as of
June 30, 2024	21	283	4	61	6	375
Credit loss expenses	5	51	1	5	‐	62
Charge-offs	(4)	(51)	(1)	(2)	‐	(58)
Collection of debts written off in previous years		- 7	-	-	-	7
Charge-offs, net	(4)	(44)	(1)	(2)	‐	(51)
Balance of credit loss provision as of September 30, 2024 (3)	22	290	4	64	6	386
Of which: (3)
For off-balance sheet credit instruments	11	‐	2	‐	2	15
For deposits with banks and amounts receivable from banks		‐ ‐	‐	‐	2	2

For the three-month period ended September 30, 2023

	Credit loss provision
		Credit risk without bank guarantees
	Private individuals		Commercial
	Receivables for credit	Credit (1)	Receivables for credit cards	Credit (1)	Other(2)
In NIS million	cards		Total
Balance of credit loss provision as of			Unaudited
June 30, 2023		23 269	4	35	4	334
Adjustment to the opening balance due to the effect of first-time application (a)		‐ ‐	‐	‐	‐	‐
Credit loss expenses		4 60	-	22	‐	86
Charge-offs	(3)	(42)	‐	(3)	‐	(48)
Collection of debts written off in
previous years		- 4	-	1	-	5
Charge-offs, net	(3)	(38)	‐	(2)	‐	(43)
Balance of credit loss provision as of September 30, 2023 (3)		24 291	4	55	4	377
Of which: (3)
For off-balance sheet credit instruments		13 ‐	2	‐	1	16
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.

	Credit loss provision
	Credit risk without bank guarantees
	Private individuals		Commercial
	Receivables for credit cards	Credit (1)	Receivables for credit Credit (1) cards		Other(2)	Total
In NIS million			Unaudited
Balance of credit loss provision as of December 31, 2023	24	297	5	60	4	390
Credit loss expenses	11	133	2	13	‐	159
Charge-offs	(14)	(158)	(2)	(12)	‐	(186)
Collection of debts written off in
previous years	1	20		‐ 2	‐	23
Charge-offs, net	(13)	(138)	(2)	(10)	‐	(163)
Balance of credit loss provision as of September 30, 2024(3)	22	292	5	63	4	386
Of which: (3)
For off-balance sheet credit instruments	11	‐	2	‐	2	15
For deposits with banks and amounts receivable from banks	‐	‐		‐ ‐	2	2

For the nine-month period ended September 30, 2024

For the nine-month period ended September 30, 2023

	Credit loss provision
	Credit risk without bank guarantees
	Private individuals		Commercial
	Receivables for credit cards	Credit (1)	Receivables for credit cards	Credit (1)	Other(2)	Total
In NIS million			Unaudited
Balance of credit loss provision as of December 31, 2022		‐ ‐	‐	‐	‐	‐
Provision for Max consolidation credit default (see Note 5 above)		5 82	1	11	4	102
Application of CECL subsequent to Max's acquisition (see Note 3(b)(2)(b))	18	177	2	23	‐	220
Credit loss expenses		6 100	1	26	‐	133
Charge-offs	(6)	(78)	‐	(6)	‐	(90)
Collection of debts written off in previous years		1 10	‐	1	‐	12
Charge-offs, net	(5)	(68)	‐	(5)	‐	(78)
Balance of credit loss provision as of September 30, 2023 (3)	24	291	4	55	4	377
Of which: (3)
For off-balance sheet credit instruments	13	‐	2	‐	1	16
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. Additional information on calculating the credit loss provision for debts and for the debts for which it was calculated

	As of September 30, 2024
	Private individuals Commercial
	Receivables for credit		Receivables for credit
	cards	Credit (1)	cards	Credit (1)	Other(2)	Total
In NIS million			Unaudited
Recorded outstanding debt:
Examined on a specific basis	4	22	78	617	‐	721
Examined on a collective basis	4,487	9,992	246	463	2,416	17,604
Total debts	4,491	10,014	324	1,080	2,416	18,325
Non-performing debts	13	148	4	26	‐	191
Other troubled debts	5	346	1	32	‐	384
Total troubled debts	18	494	5	58	‐	575
Credit loss provision in
respect of debts:
Examined on a specific basis	‐	‐	‐	32	‐	32
Examined on a collective basis	11	290	2	32	4	339
Total credit loss provision	11	290	2	64	4	371
Of which: For non-performing debts	2	63	1	17	‐	83
Of which: For other troubled debts	‐	36	‐	6	‐	42

	As of September 30, 2023
	Private individuals		Commercial
	Receivables for credit		Receivables for credit
	cards	Credit (1)	cards	Credit (1)	Other(2)	Total
In NIS million			Unaudited
Recorded outstanding debt:
Examined on a specific basis	9	13	78	550	‐	650
Examined on a collective basis	3,794	9,284	200	403	2,323	16,004
Total debts	3,803	9,297	278	953	2,323	16,654
Of which:
Non-performing debts	11	134	3	20	‐	168
Other troubled debts	10	346	1	14	‐	371
Total troubled debts	21	480	4	34	‐	539
Credit loss provision in respect of debts:
Examined on a specific basis	‐	‐	‐	15	‐	15
Examined on a collective basis	11	297	2	41	4	355
Total credit loss provision	11	297	2	56	4	370
Of which: For non-performing debts	2	54	1	12	‐	69
Of which: For other troubled debts	‐	40	‐	2	‐	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.

	As of December 31, 2023
		Private individuals Commercial
	Receivables for credit cards	Credit (1)	Receivables for credit cards	Credit (1)	Other (2)	Total
In NIS million			Audited
Recorded outstanding debt:
Examined on a specific basis	9	11	66	526	‐	612
Examined on a collective basis	3,442	9,116	171	438	2,220	15,388
Total debts	3,451	9,127	237	964	2,220	16,000
Of which:
Non-performing debts	12	136	3	24	‐	175
Debts in arrears of 90 days or more	‐	‐	‐	‐	‐	‐
Other troubled debts	5	336	1	39	‐	381
Total troubled debts	17	472	4	63	‐	556
Credit loss provision in
respect of debts:
Examined on a specific basis	‐	‐	‐	20	‐	20
Examined on a collective basis	11	295	2	41	3	352
Total credit loss provision	11	295	2	61	3	372
Of which: For non-performing debts	2	60	1	14	‐	77
Of which: For other troubled debts	‐	41	‐	7	‐	48

(1) Interest-bearing credit. This credit includes credit transactions, revolving credit card transactions, credit for card holders, credit non-card holders and other transactions.

3. Credit quality by credit granting year

Current	As of September 30, 2024
	Recorded debt balance of fixed term credit Recorded
							outstanding debt of renewed
	2024	2023	2022	2021	2020	Previous	loans	Total
In NIS million					Unaudited
Private individuals Receivables for credit cards:
Non-troubled credit	4,304	129	36	4		‐ ‐	‐	4,473
Troubled performing credit	3	1	1	‐		‐ ‐	‐	5
Non-performing credit	11	2	‐	‐		‐ ‐	‐	13
Total receivables for
credit cards	4,318	132	37	4		‐ ‐	‐	4,491
Charge-offs during the reporting period	(6)	(7)	(1)	‐		‐ ‐	‐	(14)
Credit:
Non-troubled credit	3,483	2,060	1,360	566	134	25	1,891	9,520
Troubled performing credit	23	71	97	42	13	2	98	346
Non-performing credit	46	32	15	6	1	1	47	148
Total credit	3,552	2,163	1,472	614	148	28	2,036	10,014
Charge-offs during the reporting period	(2)	(30)	(29)	(11)	(3)	(2)	(81)	(158)
Total private individuals	7,869	2,296	1,509	618	148	28	2,036	14,505
Commercial Receivables for credit cards: Non-troubled credit	305	8	1	‐	1	‐	‐	315
Troubled performing credit	1	‐	‐	‐		‐ ‐	‐	1
Non-performing credit	4	‐	‐	‐		‐ ‐	‐	4
Total receivables for
credit cards	310	8	1	‐	1	‐	‐	320

Credit:
Non-troubled credit	547	248	111	35	11	1	74	1,026
Troubled performing credit Non-performing credit	11 9	15 11	‐ 2	2 1	1	‐ ‐ 1	3 2	32 26

Total credit	567	274	113	38	12	2	79	1,084
Charge-offs during the reporting period	‐	(4)	(2)	(1)		‐ ‐	(5)	(12)
Commercial - total	877	282	114	38	13	2	79	1,404
Total debts	8,746	2,578	1,623	656	161	30	2,115	15,909

*) Receivables for credit card transactions, deposits with banks, and other debts.

** As of September 30, 2024, there is no outstanding debt for renewed loans converted to fixed loans.

	September 30, 2023
		Recorded debt balance of fixed term credit					Recor
							ded out standing debt of renewed
	2023	2022	2021	2020		2019 Previous	loans	Total
In NIS million					Unaudited
Private individuals Receivables for credit cards:
Non-troubled credit Troubled performing	3,610	142	28	3	-	-	-	3,782
credit	6	3	1	-	-	-	-	10
Non-performing credit	10	1	-	-	-	-	-	11
Total receivables for
credit cards	3,626	146	29	3	-	-	-	3,803
Credit:
Non-troubled credit	3,169	2,370	1,047	318	132	15	1,767	8,817
Troubled performing
credit	36	123	63	23	11	1	89	346
Non-performing credit	20	36	19	7	6	3	43	134
Total credit	3,225	2,529	1,129	348	149	19	1,899	9,297
Total private individuals	6,851	2,675	1,157	351	149	19	1,899	13,101
Commercial Receivables for credit cards:
Non-troubled credit	248	4	1	1	-	1	-	255
Troubled performing
credit	-	-	-	1	-	-	-	1
Non-performing credit	3	-	-	-	-	-	-	3
Total receivables for
credit cards	251	4	1	2	-	1	-	259
Credit:
Non-troubled credit Troubled performing	540	216	77	38	7	-	60	938
credit	3	5	2	1	-	-	3	14
Non-performing credit	11	4	1	-	1	1	2	20
Total credit	554	225	80	39	8	1	65	972
Commercial - total	805	229	81	41	8	2	65	1,231
Total debts	7,655	2,904	1,239	391	157	21	1,963	14,331

** As of September 30, 2023, there is no outstanding debt for renewed loans converted to fixed loans.

	As of December 31, 2023
	Recorded debt balance of fixed term credit				Recorded
							outstan ding debt of renewed
	2023	2022	2021	2020	2019	Previous	loans	Total
In NIS million					Audited
Private individuals
Receivables for
credit cards:
Non-troubled credit	3,323	90	19	2	‐	‐	‐	3,434
Troubled performing
credit	3	2	‐	‐	‐	‐	‐	5
Non-performing credit	11	1	‐	‐	‐	‐	‐	12
Total receivables for
credit cards	3,337	93	19	2	‐	‐	‐	3,451
Charge-offs during the reporting period
Credit:
Non-troubled credit	3,547	2,052	905	256	96	7	1,792	8,655
Troubled performing
credit	48	115	57	20	8	1	87	336
Non-performing credit	28	36	16	6	5	2	43	136
Total credit	3,623	2,203	978	282	109	10	1,922	9,127
Total private
individuals	6,960	2,296	997	284	109	10	1,922	12,578
Commercial
Receivables for credit
cards:
Non-troubled credit	211	2	‐	1	‐	1	‐	215
Troubled performing
credit	1	‐	‐	‐	‐	‐	‐	1
Non-performing credit	3	‐	‐	‐	‐	‐	‐	3
Total receivables for
credit cards	215	2	‐	1	‐	1	‐	219
Charge-offs during the reporting period
Credit:
Non-troubled credit	570	192	64	32	‐	(2)	63	919
Troubled performing
credit	21	9	5	1	‐	‐	3	39
Non-performing credit	16	4	1	‐	‐	1	2	24
Total credit	607	205	70	33	‐	(1)	68	982
Commercial - total	822	207	70	34	‐	‐	68	1,201
Total debts	7,782	2,503	1,067	319	109	10	1,990	13,779

** As of December 31, 2023, there is no outstanding debt for renewed loans converted to fixed loans.

C. Debts (1)

1. Credit quality and delinquency

	As of September 30, 2024

	Performing	Performing	Non performing	Total
In NIS million	Unaudited
Private individuals
Receivables for credit cards	4,473	5	13	4,491
Credit (3)	9,520	346	148	10,014
Commercial
Receivables for credit cards	319	1	4	324
Credit (3)	1,022	32	26	1,080
Other accounts receivables (4)	2,416	‐	‐	2,416
Total debts	**17,750	384	191	18,325

	As of September 30, 2023

	Performing	Performing	Non performing	Total
In NIS million	Unaudited
Private individuals
Receivables for credit cards	3,609	10	9	3,628
Credit (3)	8,613	303	115	9,031
Commercial
Receivables for credit cards	226	1	2	229
Credit (3)	856	17	15	888
Other accounts receivables (4)	2,249	‐	‐	2,249
Total debts	**15,553	331	141	16,025

** 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 17,340 million (September 30, 2023 - NIS 15,903 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 3,001 million (September 30, 2023 - NIS 2,167 million).

	As of December 31, 2023
		Troubled (2)
			Non
	Performing	Performing	performing	Total
In NIS million	Audited
Private individuals
Receivables for credit cards	3,434	5	12	3,451
Credit (3)	8,655	336	136	9,127
Commercial
Receivables for credit cards	233	1	3	237
Credit (3)	901	39	24	964
Other accounts receivables (4)	2,220	‐	‐	2,220
Total debts	**15,444	381	175	16,000

** 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 15,160 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 2,205 million.

(4) Amounts receivable from banks, deposits with banks, global credit card companies and organizations, accrued income, and other accounts receivables.

2. Additional information on non-performing debts

(a)Non-performing debts and provision

	As of September 30, 2024
	Outstanding debts
	Outstanding non-performing debts for which there is a provision(2) provision	Total non Outstanding	outstanding 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	148	63	148	148
Commercial
Receivables for credit cards	4	1	4	4
Credit	26	17	26	26
Total debts	191	83	191	191

	As of September 30, 2023
	Outstanding debts
	Outstanding non-performing debts for which there is a Outstanding provision(2) provision		Total non debts(2)	outstanding performing	Outstanding contractual principal in respect of non performing debts
In NIS million	Unaudited
Private individuals
Receivables for credit cards		11	2	11	11
Credit	134		54	134	134
Commercial
Receivables for credit cards		3	1	3	3
Credit		20	12	20	20
Total debts (3)	168		69	168	168
Of which: (3)
Restructured troubled debts		45	27	45	45

(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, 2023 Outstanding debts

	Outstanding non-performing debts for which there is a provision(2)	provision	Total non Outstanding debts(2)	outstanding performing	Outstanding contractual principal in respect of non performing debts
In NIS million			Audited
Private individuals
Receivables for credit cards		12	2	12	12
Credit		136	60	136	136
Commercial
Receivables for credit cards		3	1	3	3
Credit		24	14	24	24
Total debts (3)		175	77	175	175
Of which: (3)
Restructured troubled debts		58	31	58	58

(1) Receivables for credit card transactions, deposits with banks, and other debts.

(2) Recorded outstanding debt.

Information regarding debts of 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 with financial difficulties who underwent a change in terms and conditions (2)

	As of September 30, 2024 Recorded outstanding debt

	Non-performing interest income Total
In NIS million	Unaudited
Private individuals
Receivables for credit cards	4	4
Credit	49	49
Commercial
Credit	9	9
Total debts	62	62

	As of September 30, 2023 Recorded outstanding debt

	Non-performing interest income Total
In NIS million	Unaudited
Private individuals
Receivables for credit cards	3 3
Credit	39 39
Commercial
Credit	3 3
Total debts	45 45

(1) Receivables for credit card transactions, deposits with banks, and other debts.

(2) The data as of September 30, 2023 present data about restructured troubled debt, in accordance with the previous directive.

	As of December 31, 2023
	Recorded outstanding debt
	Non-performing interest income Total Audited
In NIS million
Private individuals
Receivables for credit cards	3 3
Credit	44 44
Commercial
Credit	11 11
Total debts	58 58

(1) Receivables for credit card transactions, deposits with banks, and other debts.

(2) The data as of December 31, 2023 present data about restructured troubled debt, in accordance with the previous directive.

(b)The credit quality and extent of arrears of debts of distressed borrowers who underwent a change in terms and conditions during the reporting period (2)

	For the three-month period ended September 30, 2024 Recorded outstanding debt

In NIS million	Unaudited
Private individuals
Receivables for credit cards	1	1	‐
Credit	16	16	-
Commercial
Credit	6	6	‐
Total debts	23	23	-

	For the three-month period ended September 30, 2023 Recorded outstanding debt

	Troubled non performing	Total	Charge-off
In NIS million	Unaudited
Debts not guaranteed by banks
Private individuals
Receivables for credit cards	1	1	‐
Credit	13	13	-
Commercial
Receivables for credit cards	1	1	‐
Total debts	15	15	-

(1) Receivables for credit card transactions, deposits with banks, and other debts.

(2) The data as of September 30, 2023 present data about restructured troubled debt, in accordance with the previous directive.

	For the nine-month period ended September 30, 2024 Restructurings carried out during the reporting period

	No. of debt settlements	Recorded outstanding debt
In NIS million		Unaudited
Debts not guaranteed by banks
Private individuals	2	2	‐
Receivables for credit cards	31	31	12
Commercial
Receivables for credit cards	8	8	‐
Total debts	41	41	12

	For the nine-month period ended September 30, 2023
	Restructurings carried out during the reporting period
	No. of debt settlements	Recorded outstanding debt
In NIS million	Unaudited
Debts not guaranteed by banks
Private individuals	2	2	‐
Receivables for credit cards	39	39	8
Commercial
Receivables for credit cards	2	2	‐
Total debts	41	41	8

(2) The data as of September 30, 2023 present data about restructured troubled debt, in accordance with the previous directive.

(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 September 30, 2024

		Total
	Recorded outstanding debt	% of total	Waiver of interest	Extension of period	Extension of period and waiver of interest	Payment deferral
			Unaudited
	NIS million		%NIS million
Private individuals
Receivables for credit cards		1 0.0		‐	1	‐
Credit		16 0.2		5	10	1
Commercial
Credit		6 0.5		‐	6	‐
Total debts		23 0.1		5	17	1

	Financial effects of the change in terms and conditions during the three-month period ended September 30, 2024				Debts of distressed borrowers who defaulted following changes of terms during the three month period ended September 30, 2024 (2)
		Type of change		Total	Type of change
	Average waiver of interest	Average extension of period	Average payment deferral	Recorded outstan ding debt	Waiver of interest	Extension of period	Extension of period and waiver of interest	Payment deferral
					Unaudited
	%	Months				NIS million
Private individuals Receivables for
credit cards	‐	18	‐	‐	‐	‐	‐	‐
Credit	2.0	18	‐	4	1	3	‐	‐
Commercial
Credit	1.5	12	‐	‐	‐	‐	‐	‐
Total debts	1.8	16	‐	4	1	3	‐	‐

(2) Debts that defaulted during the Reporting Period after they underwent a change in terms and conditions of debts of distressed borrowers during the 12 months prior to the date on which they defaulted.

	during the nine-month period ended September 30, 2024
		Total		Type of change
	Recorded outstanding debt	% of total	Waiver of interest	Extension of period	Extension of period and waiver of interest	Payment deferral
			Unaudited
	NIS million	%		NIS million
Private individuals
Receivables for credit cards	2	0.04		‐	2	‐	‐
Credit	31	0.31		8 21		2	‐
Commercial
Credit	8	0.73		1	2	‐	5
Total debts	41	0.26		9 25		2	5

Debts of distressed borrowers who underwent changes of terms

	Financial effects of the change in terms and conditions during the nine-month period ended September 30, 2024				Debts of distressed borrowers who defaulted following changes of terms during the nine month period ended September 30, 2024 (2)
		Type of change	Total		Type of change
	Average waiver of interest	Average extension of period	Average payment deferral	Recorded outstandi ng debt	Waiver of interest	Extension of period	Extension of period and waiver of interest	Payment deferral
	Unaudited
	%	Months				NIS million
Private individuals
Receivables for credit cards	‐	21	‐	1	‐	1	‐	‐
Credit	2.10	24	‐	4	1	3	‐	‐
Commercial
Credit	1.80	12	6	1	‐	1	‐	‐
Total debts	1.90	22	6	6	1	5	‐	‐

	As of	As of	As of
	September 30	September 30	December 31
	2024	2023	2023
In NIS million	Unaudited	Unaudited	Audited
Merchants (1)	8,400	7,599	7,272
Liabilities for deposits (2)	215	166	155
Credit card companies	797	528	414
Prepaid income	26	19	18
Benefit plan for card holders (3)	88	70	72
Other (4)	90	170	160
Total payables for credit card transactions	9,616	8,552	8,091

NOTE 10 - PAYABLES FOR CREDIT CARD TRANSACTIONS (4)

(1) Net of balances for factoring credit card vouchers for merchants in the amount of NIS 1,618 million (December 31, 2023 - NIS 1,768 million, September 30, 2023 - NIS 1,785 million) and for early payments to merchants in the amount of NIS 218 million (December 31, 2023 - NIS 309 million, September 30, 2023 - NIS 283 million).

(2) 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.

(3) 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.

(4) Mainly accrued expenses in respect of banks and loyalty programs.

NOTE 11 - INCOME FROM CREDIT CARD TRANSACTIONS

	For the three month period ended September 30		For the nine-month period ended September 30*)		For the year ended December 31
	2024	2023	2024	2023	2023
In NIS million		Unaudited			Audited
Income from merchants
Merchants fees and commissions	210	198	601	390	564
Other income	46	43	133	83	123
Total income from merchants - gross	256	241	734	473	687
Net of fees and commissions to other issuers	(99)	(92)	(282)	(181)	(261)
Total income from merchants - net	157	149	452	292	426
Income from credit card holders			‐
Issuer fees and commissions	152	139	419	269	382
Service fees and commissions	56	48	152	93	134
Fees and commissions from cross-border transactions	51	57	128	106	141
Total income for credit card holders	259	244	699	468	657
Total income from credit card transactions	416	393	1,151	760	1,083

*) Since the data were first consolidated as from April 1, 2023, as noted above, the cumulative effect on the Company's results is presented for the nine-month period which began on that date. For further details, see Note 5 above.

NOTE 12 - ADDITIONAL EVENTS DURING AND SUBSEQUENT TO THE REPORTING PERIOD

A. Issuance of bonds by the Company

For details regarding the issuance of bonds by the Company during 2023, see Note 26(c) to the Consolidated Financial Statements for 2023.

In February 2024, some of the above issuance proceeds were used to effect 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. Economic solvency ratio in Clal Insurance

On November 27, 2024, Clal Insurance approved its Economic Solvency Ratio Report as of June 30, 2024. For further details, see Note 7 above.

C. Share-based payment

On May 30, 2024, the Company's board of directors resolved to publish an outline for the allocation of up to 1,400,000 Class A 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. 0.44% 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. NIS 14.1 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 18.75 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 one year from the vesting date. (In relation to the first tranche, at least two years of vesting and holding are required).

D. Actuarial estimates

1. Life and Health Insurance

Further to Note 42(e)(e1)(d)(1) to the Consolidated Financial Statements for 2023 regarding changes in insurance reserves due to the interest rate environment and its effect on the discount rates in Life and long-term care insurance and the Commissioner's Directives regarding the liability adequacy test (LAT):

A. Discount rate taken into account in the calculation of the liabilities for complementing the reserves for paid pensions and annuity

In the reporting period, there was a change in the risk-free interest rate curve and illiquidity premium and the estimated rate of return in the assets portfolio held against insurance liabilities increased. Accordingly, the actuary of Clal Insurance actuary revised the interest rates on the available assets used to capitalize the liabilities to supplement reserves for paid pensions and annuity.

B. Gradual provision to complement the annuity reserve by using the K factor

Following on Note 42(e)E1(a)3(b) to the Consolidated Financial Statements for 2023, every quarter, the Company checks whether the K-value will enable an appropriate distribution of the reserve for payment of pension, based on an analysis which is based on conservative financial and actuarial assumptions, which indicates that the management fees and/or financial margin arising from the investments held against the reserve for the policy and the premium payments for the policy, may generate future income in excess of the basic K-value, which will be sufficient to cover all expenses; if any gap exists, the liabilities for supplementing the annuity reserve are updated by updating the K-value. The higher is the K Factor, the lower the liability for the supplementary annuity reserve that will be recognized in the financial statements and the higher the amount that will be deferred and recorded in the future.

During the Reporting Period and the three-month period ended September 30, 2024 there was no change in the K value.

	As of September 30 As of June 30			As of December 31
	2024	2023	2024	2023	2023
	Unaudited				Audited
In respect of guaranteed-return policies	0.0%	0.0%	0.0%	0.0%	0.0%
In respect of yield-dependent insurance policies	0.96%	0.915%		0.96% 0.825%	0.96%

C. Liability adequacy testing (LAT)

Further to Note 3(d)1(d) to the Consolidated Financial Statements for 2023, the Company conducts liability adequacy testing on a periodic basis, in accordance with the LAT Circular.

D. Changes to actuarial assumptions in the calculation of the liabilities for annuities

In July 2024, Amendment of the Consolidated Circular Provisions on Measuring Liabilities - Revising the Demographic Assumptions in Life Insurance and Pension Funds (hereinafter - the "Circular") was published. The circular includes a revision to the default assumptions on the basis of which the institutional entities will calculate their liabilities and conversion factors in relation to annuity recipients in pension savings products.

Further to Note 42(e)(e1)a(3) to the Consolidated Financial Statements for 2023, the liabilities in respect of supplementation of annuity and paid pensions reserves are calculated in accordance with the assumptions included in the Reserves for Annuity Circular, and therefore, in its financial statements as of June 30, 2024, the Company increased its estimates regarding the liabilities in respect of insurance contracts by approx. NIS 128 million, of which approx. NIS 99 million in respect of the liability for paid pensions, and approx. NIS 29 million for liabilities in respect of supplementation of annuity reserve, in view of the trends arising from the circular.

Further to Note 42(e)(e1))(3) to the Consolidated Financial Statements for 2023, the liabilities in respect of supplementation of annuity reserve and paid pensions, from time-to-time studies are conducted regarding the rate of policyholders, who are expected to uptake their entitlement for an annuity upon retirement. In view of a study regarding this topic, which was conducted by the other insurer in a joint venture of the Company, the latter reduced its estimates as to liabilities in respect of insurance contracts by approx. NIS 69 million in the financial statements as of June 30, 2024.

2. Property and Casualty

Further to Note 42(e)(e2)(4)(a) to the Consolidated Financial Statements for 2023, due to a change in the riskfree interest rate curve and illiquidity premium, the Company updated the estimated discount rate for the reporting period and nine- and three-month period ended on September 30, 2024; the total effect of the change resulted in a reduction of retention insurance reserves by approx. NIS 42 million and an increase in retention insurance reserves totaling approx. NIS 9 million, respectively.

3. The effect of the financial results is set out below:

	For the nine-month period ended September 30		For the three-month period ended September 30		For the year ended December 31
In NIS million	2024	2023	2024	2023	2023
		Unaudited
Life Insurance
Change in the discount rate is taken into account in the calculation of the liability for complementing the reserves for paid pensions and annuity	32	62	(2)	20	124
Change in the pension reserves due to the expected reduction in future income from change in interest rate (K factor)	-	159	-	209	260
The total effect of changes in interest on the liabilities for complementing the reserves for paid pensions and annuity	32	221	(2)	229	384
Change in the mortality assumptions in the calculation of the liabilities for annuities	(128)	-	-	-	-
Changes to other assumptions in the calculation of the liabilities for annuities	69	-	-	-	67
Total Special Items - life insurance	(27)	221	(2)	229	451
Financial effect on P&C insurance reserves	42	123	(9)	36	83
Total Special Items - P&C insurance	42	123	(9)	36	83
Long-term care in the Health Segment
Changes in actuarial assumptions for incidence of long-term care claims, including liability adequacy testing (LAT)	-	-	-	-	(102)
Financial effects in the liability adequacy test (LAT)	35	-	-	-	-
Total long-term care in the Health Insurance Segment	35	-	-	-	(102)
Total profit (loss) before tax	50	344	(11)	265	432

4. 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.

E. Issuance of notes in Clalbit Finance Ltd. a subsidiary of Clal Insurance (hereinafter - "Clalbit Finance")

The Notes (Series M), that were issued as stated above, were recognized (subject to restrictions) as Tier 2 capital of Clal Insurance, instead of Notes (Series F), that were exchanged, and which were recognized as hybrid Tier 2 capital.

The terms of some of the Notes (Series J) vary from the terms of the Notes (Series M), and accordingly they were accounted for as replacement of debt instruments with materially different terms, in accordance with the standard's definition; accordingly, Clal Insurance accrued a loss of approx. NIS 1.6 million. The issuance costs amounted to approx. NIS 1.5 million.

In April 2024, Clalbit Finance issued to the public NIS 465 million p.v. in Notes (Series M) by way of expansion of an existing series in consideration for approx. NIS 460 million. The terms and conditions of the additional notes are identical to the terms and conditions of the Notes (Series M) in circulation. The issuance costs amounted to approx. NIS 5.1 million.

On July 31, 2024, Clalbit Finance executed early redemption of the outstanding balance of the Notes (Series J), in accordance with their terms and conditions.

F. Rating

On July 9, 2024, S&P Maalot reiterated Clal Insurance's ilAA+ rating with a stable outlook, and also reiterated the ilAArating of the Notes (Series A, B and C) issued by the Company, with a stable rating outlook for each of the series. It also reiterated the ilAA- rating for the Notes (Series I, J, K, L and M) issued by Clalbit Finance, with a stable outlook for each of the series.

On July 29, 2024, Midroog reiterated the Aa1.il Insurer Financial Strength rating of Clal Insurance with a stable outlook and ratified the Aa3.il (hyb) rating for the Notes (Series I, J, K, L and M) issued by Clalbit Finance, with a stable outlook for each of the series.

G. Extension of the term of the Company and Clalbit Finance's shelf prospectuses

On July 17, 2024, the term of the Company and Clalbit Finance's shelf prospectuses was extended from July 24, 2022 to July 24, 2025 (hereinafter - the "Shelf Prospectuses"). The Shelf Prospectuses allow the Company and Clalbit Finance, among other things, to issue bonds and options for bonds. Generally, the consideration of bonds, which will be issued by Clalbit Finance by virtue of the Shelf Prospectus, shall be deposited with Clal Insurance, which will bear the liability towards bondholders to repay the bonds they hold.

H. Filing a draft initial public offering prospectus by Max

On June 30, 2024, Max filed to the Israel Securities Authority a first draft of an initial public offering (IPO) prospectus, which also constitutes a shelf prospectus, which will allow the issuance of notes, options convertible into bonds and commercial securities and/or the listing of illiquid subordinated notes issued by Max. This is as part of Max's strategy to diversify its sources of financing in order to fund its operating activities.

Max does not undertake to publish the prospectus and/or issue any securities in accordance with the prospectus, to the extent that it is published. The publication of the prospectus and/or the issuance of securities thereunder are subject to Max's full discretion and to the receipt of approvals required by law, including the Israel Securities Authority's permit and the approval of the Tel Aviv Stock Exchange Ltd. Accordingly, there is no certainty that the prospectus will be published and/or that various securities will be issued thereunder.

I. The Iron Swords War

Following on Note 46(k) to the Consolidated Financial Statements for 2023, the Israeli economy continues operating in a wartime routine. The economy is operating almost at normal levels, except for the areas which suffered directly from the events of October 7, 2023 and the north of Israel, where the firing range grew, with fighting intensifying in recent months, residents still unable to return to their homes and businesses unable to resume operations.

Israel's credit rating

International credit rating agency S&P announced on April 18, 2024 the downgrading of the sovereign rating of Israel from AA- to A+, and reiterated the rating outlook at negative. Furthermore, on April 2, 2024 the international credit rating agency Fitch reiterated Israel's credit rating at A+, but changed the rating outlook from stable to negative.

On August 1, 2024, S&P rating agency published an announcement in which it noted that the potential for a wider conflict in the region presents substantial risks for Israel. In accordance with the announcement, a further escalation is not part of the baseline ratings scenario for Israel and might present a risk to the current rating of the country. In addition, on August 12, 2024, international credit rating agency Fitch downgraded Israel's credit rating from A+ to A, with a negative rating outlook. The reasons for the rating downgrade arise, among other things, from the continued fighting in Gaza and the increase in the geopolitical risks.

On September 27, 2024, the rating agency Moody's announced a downgrading of the State of Israel's debt credit rating by two notches (in one go) from A2 to Baa1 with a negative outlook.

Effect on the financial statements

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 announced that, as from December 2023 and during the Reporting Period, the issuing turnovers in Israel and acquiring turnovers in Max were even higher than the corresponding period last year. Max's overseas issuing turnovers, which were affected throughout the War, have also started growing gradually; however, any escalation or security event, which takes place during this period, has a direct effect on overseas issuance turnovers. Despite the fact that in the second and third quarters of the year the volumes of overseas turnovers were similar to those of the corresponding periods last year, in view of the relatively low overseas turnover in the first quarter of the year, the aggregate overseas turnovers for the Reporting Period are still relatively low compared to the corresponding period last year.

The estimated provision for credit losses is based on judgments and assessments, and still involves uncertainty at this stage. Further to Max's 2023 Financial Report, Max increased the provision for current expected credit losses based on estimates of a potential increase in the credit risk of its 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.

Therefore, as of the report publication date, it is impossible to assess the full effect of the War on the Group and its results.

J. Changes in tax rates

In March 2024, the Knesset plenum approved an order stipulating an increase in the rate of VAT from 17% to 18% as from January 1, 2025. In addition, an amendment to the Value Added Tax Ordinance (Tax Rate for Non-Profit Organizations and Financial Institutions), 2024 (hereinafter - the "Ordinance") was approved, 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 income generated.

The deferred tax balances included in the financial statements as of Group's financial institutions September 30, 2024 have been updated by an immaterial amount, so as to take into account the effects, which arise from the increase in tax rates as described above.

In addition, the Company estimates that the effect of the change in tax rates is not expected of be material.

K. Appointment of officers

On June 1, 2024, Mr. Tomer David started serving as the Group's Chief Internal Auditor instead of Mr. Eran Shahaf.

On July 1, 2024, Mr. Dror Biran started serving as the Group's Chief Legal Counsel instead of Ms. Hadar Brin Weiss.

On September 21, 2024, Max's CEO, Mr. Ron Fainaro, announced his wish to terminate his service in Max.

On October 5, 2024, Max's Board approved the appointment of Ms. Sagit Dotan, who currently serves as Executive Vice President and Head of the Private Customers Department of Max, as Max's CEO. The appointment is subject to the approval or non-objection of the Banking Supervision Department. On November 14, 2024, Max received the Banking Supervision Department's notice of non-objection to the said appointment. The appointment will become effective on January 1, 2025.

L. Workers' union in Tmura agency

Following on Note 25(c)(1) to the Consolidated Financial Statements for 2023, in May 2024 Tmura's management recognized the National Labor Federation in Eretz-Israel as the representative employee organization of Tmura's employees.

M. Signing of a collective agreement in Max

Further to Note 25(C)(2) to the Consolidated Financial Statements for 2023, on October 8, 2024 a collective agreement was signed between New Histradrut Workers' Union - Histadrut HaMaof - and Max employees' representatives (hereinafter - the "Agreement"), which is valid for the period from July 1, 2024 to December 31, 2028.

The Agreement consolidates past agreements into a single agreement subject to changes and additions, the key points of which are as detailed below:

Industrial peace will be maintained during the entire term of the agreement. In addition, the agreement exhausts the claims and assertions of all of the parties.

Payment of pay rises to employees at variable rates, which were set in accordance with achievement of business targets as stipulated in the Agreement and the agreement term - 3.65% in the first year and up to 3.4% per each additional year.
The minimum institutional wage as defined in the agreement will rise to NIS 6,500, and the hourly pay will be revised in accordance with the minimum wage in Israel.
In view of the increase in the number of employees and the increase in the cost of living, it was agreed to improve the related benefits to certain groups; this includes, among other things, revision of the convalescence fee tariffs, the tariffs of meals outside the office, costs of vehicles, gifts for the Jewish festivals and seniority bonuses; it was also agreed to increase the welfare budgets as detailed in the agreement.

In the opinion of Max's management, the agreement is not expected to have a material effect on Max's financial statements in 2024 or in subsequent years.

Max's engagement with a banking corporation

Further to Note 20.B.1 to Max's 2023 financial statements regarding an agreement, which was signed on October 11, 2018 between Max and Bank Leumi (hereinafter - the "Bank") for a joint issuing and issuing processing services, on June 24, 2024 Max informed the Bank of the exercise of the option it had under the agreement regarding the extension of the Bank's undertaking period set in the agreement. The joint issuing agreement with the Bank is valid until January 31, 2029.

N. Dividend distribution by the Company

Subsequent to the reporting date, on November 28, 2024, the Company's Board approved a dividend distribution totaling approx. NIS 100 million, which constitutes approx. 60% 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 7(b) above).

O. Market developments in the reporting period and thereafter

In the Reporting Period, investment income was recognized, which led to a positive real return in the participating life insurance policies, which were marketed through 2004. However, as long as the policies do not achieve a positive real return that will cover the investment losses accrued by the policyholders, Clal Insurance will not be able to collect variable management fees. The estimated variable management fees, which will not be collected due to the negative real return until the attainment of a cumulative positive return, amounted to a total of approx. NIS 0.3 billion as of September 30, 2024 and immediately prior to the approval date of the Consolidated Interim Financial Statements approx. NIS 0.2 billion. It is not possible to assess the continued developments on the markets and their impact on the results of the fourth quarter of 2024 and on 2024 as a whole, accordingly, the aforementioned does not constitute any assessment regarding the anticipated financial results of the Company.

NOTE 13 - 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

Further to Note 4 to the Annual Financial Statements, in May 2017, the International Accounting Standards Board (IASB) published IFRS 17 - Insurance Contracts. Furthermore, in June 2020 and December 2021, the IASB published amendments to the standard (hereinafter - "IFRS 17").

IFRS 17 sets rules for the recognition, measurement, presentation and disclosure of insurance contracts and supersedes the current guidance on this issue under IFRS 4 and the directives of the Capital Market, Insurance and Savings Authority. The Company continues to assess the effects of the adoption of the said standards on its financial statements, and is preparing for their implementation according to said schedule, but at this stage, it is unable to assess the effect of the standard's application on its financial statements.

The first-time application date set in IFRS 17 is January 1, 2023; however, in accordance with the requirements of the Commissioner, which were published as part of the "Roadmap for the Adoption of International Financial Reporting Standard (IFRS) 17 - Insurance Contracts" (hereinafter - the "Roadmap"), the first-time application date of IFRS 17 in Israel was postponed to the quarterly and annual periods beginning on January 1, 2025, and the transition date is January 1, 2024.

In order to support the preparations made by Israeli insurance companies for the adoption of IFRS 17, the Commissioner published drafts of the circular regarding "Professional Issues Pertaining to the Implementation in Israel of IFRS 17". The tenth draft was published in August 2024 (hereinafter - the "Draft Circular") and deals with, among other things, clarifications in connection with the calculation of the risk adjustment (RA) in respect of non-financial risk, the calculation of the fair value when implementing the fair value approach on transition date, clarifications in connection with the calculation of the weight of the illiquidity premium, as well as guidance regarding the calculation of the fair value of Hetz bonds.

In August 2024, the Commissioner published a draft of a fourth revision to the Roadmap, which included revisions of the schedules for reporting to the Authority, entitled Quantitative Impact Studies. The revision also cancelled the requirement to provide qualitative disclosure of opening balances data as of the transition date in the financial statements for the third quarter of 2024.

In July 2014, the IASB published IFRS 9 regarding Financial Instruments (hereinafter - "IFRS 9"), which supersedes IAS 39 and sets new rules for classification and measurement of financial instruments, with an emphasis on financial assets. The first-time application date set in IFRS 9 is January 1, 2018. In September 2016, an amendment to IFRS 4 was published, which allowed entities which issue insurance contracts and meet certain prescribed criteria to postpone the adoption of IFRS 9 to January 1, 2023 (the first-time application date of IFRS 17), in order to eliminate the accounting mismatch which may arise from the application of IFRS 9 prior to the application of IFRS 17. The Company complied with the abovementioned criteria and postponed the application of IFRS 9 accordingly. Upon the deferral of the first-time application date of IFRS 17 to January 1, 2025, the Commissioner also postponed the first-time application date of IFRS 9 to January 1, 2025, accordingly.

It is emphasized that the information detailed below regarding the accounting policies is correct as of the date of this report and is subject to changes as part of the progress of application.

A. The Company's preparation for the application of IFRS 17 and IFRS 9

As part of the standards' adoption process, the Company is implementing and integrating IT systems that are necessary for applying the provisions. In addition, the Company is testing and mapping the required controls and the flow of information to the financial statements. Furthermore, as part of the preparations, the Company executes quantitative tests in order to assess the methodologies, the accounting policies, and the implementation of the systems. In accordance with the roadmap published by the Capital Market, Insurance and Savings Authority, the qualitative tests are reported to the Authority in accordance with the time frames set forth.

B. IFRS 17 - Main changes in the accounting policies

Following are the main requirements and accounting policies, which were selected by the Company:

The Standard's scope

IFRS 17 applies to contracts, which meet the definition of an insurance contract and include:

a) Insurance contracts, including reinsurance contracts, which the Company issues;
b) Reinsurance contracts held by the Company; and

c) Investment contracts with discretionary participation features, which the Company issues, provided that it also issues insurance contracts.

The measurement model

The standard includes three models for measuring the liability in respect of insurance contracts:

General measurement model (GMM)

In accordance with this model, which constitutes the standard's default model, the liability in respect of groups of insurance contracts should be measured at the initial recognition date as the present value of the discounted bestestimate of future cash flows, plus an explicit risk adjustment (RA) in respect of the non-financial risks. The expected income from the insurance contracts, which is derived from such calculations, shall be recognized as a liability (contractual service margin - CSM), which will be recognized in profit and loss over the coverage period. If there is an expected loss, a loss component will arise, and it will be recognized immediately. Such liability components are classified into two types of liabilities: Liability for remaining coverage (LRC) and liability for incurred claims (LIC).

In subsequent periods, the contractual service margin will be adjusted in respect of changes in non-financial assumptions related to the future service. If the contractual service margin reached zero as a result of those changes, any change beyond that will be recognized immediately in profit and loss. On the other hand, changes arising from the time value of money and financial risks are recognized immediately under finance expenses in respect of insurance contracts.

In held reinsurance contracts, the contractual service margin may be an asset or a liability and it represents the net expected cost or the net expected income, respectively. If the reinsurance contract exists upon recognition of a loss component in respect of a group of insurance contracts covered by the reinsurer, the Company will recognize immediately an income in respect of the reinsurance contract (loss recovery component) against adjustment of the contractual service margin.

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.

In accordance with the VFS model, the cash flows for the fulfillment of the contract are composed of the liability to pay the policyholder an amount equal to the fair value of the underlying items, net of the variable fee in respect of the service. A change in the liability to pay the policyholder an amount equal to the fair value of the underlying items is recognized directly in finance expenses in respect of insurance contracts. The contractual service margin is adjusted in respect of changes in non-financial assumptions, as is the case in the GMM model, and in respect of financial changes, which affect the variable fee.

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

The Company expects that insurance contracts which include yield-dependent savings components will be measured under the VFA model, but changes are possible as the process of applying the standard progresses.

3. Premium allocation approach - the PAA model

This model is a simplification of the general measurement model; it can be applied to certain groups of insurance contracts, for which it provides a measurement, which is a reasonable approximation to a measurement in accordance with the general measurement model.

In accordance with this model, the liability in respect of the remaining coverage is determined as the total amount of the premiums received net of any insurance acquisition cash flows, and net of the premium amounts and insurance acquisition cash flows, which were recognized in profit or loss in respect of the coverage period, which elapsed. Premiums received and insurance acquisition cash flows are recognized in profit or loss over the coverage period on the basis of the passage of time. Or on the basis of the expected pattern of release from risk over the coverage period if it differs significantly from the passage of time.

For groups of insurance contracts, under the PAA model the Company may recognize any insurance acquisition cash flows as expenses when it incurs those costs, provided that the coverage period of each contract in the group is no more than one year. This selection is carried out at the level of the insurance contract portfolio.

If facts and circumstances indicate that a group of insurance contracts is onerous, the Company measures the present value of the future cash flows plus a risk adjustment in respect of non-financial risks, as is the case in the principles of the general measurement model. If this amount exceeds the carrying amount of the liability in respect of the remaining coverage, the Company shall increase the liability in respect of the remaining coverage against an immediate recognition of a loss in the statement of profit and loss.

If a reinsurance contract exists upon recognition of a loss component in respect of a group of insurance contracts covered by it, the Company will recognize immediately an income in respect of the reinsurance contract (loss recovery component) against adjustment of the carrying amount of the asset for remaining coverage.

The liability for incurred claims is calculated in accordance with the same principles as those used in the GMM model. The standard allows not to discount the future cash flows in respect of incurred claims if those cash flows are expected to be paid or received within one year or less from the date the claims are incurred. The Company does not implement the abovementioned expedient.

The Company may implement the Premium Allocation Approach only if upon inception of the group:

a) The coverage period of each contract in the group is one year or less; or
b) The Company reasonably expects that such simplification would produce a measurement of the liability for the remaining coverage period provided by the group that would not differ materially from the measurement that would result from applying the general measurement model.

The Company expects that P&C insurance contracts and travel insurance contracts will be measured under the PAA model, but changes are possible as the process of applying the standard progresses.

Aggregation level

IFRS 17 requires the aggregation of insurance contract into groups for recognition and measurement purposes. The Company will determine the groups upon initial recognition and will not change the composition of the groups at a later date.

Initially, the Company is required to identify portfolios of insurance contracts. A portfolio comprises contracts subject to similar risks and managed together. Once it identified a portfolio, the Company shall divide it into a minimum of the following groups, based on the expected profitability upon initial recognition:

A group of contracts, which are onerous at initial recognition;
a group of contracts, which at initial recognition have no significant possibility of becoming onerous subsequently; and
a group of the remaining contracts in the portfolio.

In accordance with the standard, for contracts to which the Company applies the PPA model, the Company shall assume no contracts in the portfolio are onerous at the initial recognition date, unless facts and circumstances indicate otherwise. IFRS 17 stipulates that an entity shall not include contracts issued more than one year apart in the same group, such that each underwriting year will be associated with a separate group of insurance contracts.

Contract boundaries

Cash flows are within the boundary of an insurance contract if they arise from substantive rights and obligations which exist during the reporting period in which the Company can compel the policyholder to pay the premiums or in which it has a substantive obligation to provide the policyholder with services. A substantive obligation to provide services ends when the Company has the practical ability to reassess the risks of the particular policyholder (single policyholder) or the insurance contracts portfolio.

Cash flows are within the boundary of a reinsurance contract if they arise from substantive rights and obligations, which exist during the reporting period, in which the Company is compelled to pay amounts to the reinsurer or has a substantive right to receive services from the policyholder.

At this stage, the Company does not expect material changes to the contract boundary compared to IFRS 4.

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

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, which include insurance risk and other non-financial risks, such as lapse risk, and expenses risk. The RA also reflects the following:

• The level of compensation for diversification that the Company includes when setting the compensation it claims for bearing that risk; and

• Both favorable and unfavorable outcomes, in a way which reflects the Company's degree of risk aversion.

The Company adjusts the estimated present value of the future cash flows in respect of this amount, which is reflected separately in the Company's total liabilities.

IFRS 17 does not specify the estimation techniques used to determine the risk adjustment for non-financial risk.

The Company is still assessing the manner by which it will apply the determination of the risk adjustment for nonfinancial risk and the confidence interval which will be taken into account.

Interest rate curves

IFRS 17 stipulates that the estimates of future cash flows should be adjusted to reflect the time value of money and the financial risks related to those cash flows, to the extent that the financial risks are not included in the estimates of the cash flows.

The standard stipulates that the discount rates applied to the estimates of the future cash flows shall:

The Company determines the real interest rate curves for all groups of insurance contracts using the bottom-up approach. 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 technique used to estimate the risk-free interest rate curve as described above is mostly in line with the approach implemented for purposes of Liability Adequacy Test (LAT) under IFRS 4.

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

The CSM represents the liability in respect of the unearned income relating to future services in the GMM and VFA measuring models. In accordance with the standard, the CSM will be recognized in profit and loss over the coverage period through a pattern, which reflects the insurance service provided by the Company in connection with the contracts, which are included in the insurance contracts group, and taking into account the service of investments in insurance contracts which include a savings component. 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 in connection with the insurance contracts group.

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.

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, with adjustments in respect of the differences in the services provided.

Presentation

Under IFRS 17, the Company will disaggregate the amounts recognized in the statement of other comprehensive income into:

A. Insurance service results, comprising insurance revenue and insurance service expenses; and
B. Finance income or finance expenses from insurance.

The above disaggregation shall increase transparency as to the Company's sources of income.

Transitional provisions

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 will restate 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 draft 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 expects to implement the retrospective application approach for the property and casualty insurance portfolios and travel policies.

The Company expects that a Full Retrospective Application of IFRS 17 for groups of Life and Health Insurance contracts will be impractical, except for travel insurance, and it intends to apply the modified retrospective approach to the critical illness portfolios and the portfolios of life insurance contracts sold in the past few underwriting years; it also intends to apply the fair value approach to all other portfolios.

C. IFRS 9 - Main changes in the accounting policies

Classification and measurement

Financial assets

In implementing IFRS 9, the Company will classify financial assets in accordance with their subsequent measurement at amortized cost, at fair value through other comprehensive income or at fair value through profit or loss, based on the Company's business model for managing financial assets, and projected cash flow of the financial asset.

A financial asset will be measured at amortized cost if the two following conditions are fulfilled:

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").

A financial asset will be measured at fair value through other comprehensive income if the two following conditions are fulfilled:

a) Equity instruments, which the Company opted to measure at fair value through other comprehensive income; or
b) The debt instrument is held within a business model whose objective is to collect contractual cash flows and to sell financial assets; and
c) The debt instrument fulfills the principal and interest criteria.

A financial asset will be measured at fair value through profit or loss unless it is measured at amortized cost or at fair value through other comprehensive income.

Notwithstanding the foregoing, on initial recognition date, the Company may designate a financial asset as measured at fair value through profit or loss if such designation eliminates or significantly reduces a measurement or recognition inconsistency, which would have otherwise arisen from the measurement of assets or liabilities or from recognition of gains and losses thereon using different measurement bases.

The application of IFRS 9 will have the following effect on the classification and measurement of the Company's financial assets:

Participating portfolio

The underlying items of insurance contracts, which include participating savings and other insurance contracts, which include profit participation, will be measured at fair value through profit or loss, similarly to the current practice under IAS 39.

The nostro portfolio

Derivatives will be measured at fair value through profit or loss as is the case in IAS 39.
It is expected that investments in debt instruments, which do not meet the Solely Payments of Principal and Interest test shall be classified to fair value through profit or loss.
It is expected that investments in liquid equity and debt instruments will be measured at fair value through profit or loss rather than at fair value through capital reserve (available-for-sale financial assets) under IAS 39.
It is expected that the remaining debt assets held against liabilities in respect of insurance contract will be designated to fair value through profit or loss in order to avoid an accounting mismatch with liabilities in respect of insurance contracts.
The remaining debt assets, which are not held against liabilities in respect of insurance contracts, are still being assessed.

The decisions as to the classification and measurement of the nostro portfolio will be assessed on an ongoing basis as the standard's application process progresses.

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. This matter will be assessed on an ongoing basis as the standard's application process progresses.

Impairment model 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.

The impairment in respect of debt instruments measured at amortized cost shall be recognized in profit or loss against a provision, whereas the impairment in respect of debt instruments measured at fair value through other comprehensive income shall be recognized against capital reserve, and will not reduce the carrying amount of the financial asset in the statement of financial position.

Appendix 1 - Breakdown of assets for yield-dependent contracts and other financial investments of the consolidated insurance companies registered in Israel

1. Assets for yield-dependent contracts

Following is a breakdown of assets held against insurance contracts and investment contracts:

			As of
		As of September 30
	2024	2023	2023
In NIS million	Unaudited	Audited
Investment property *)	3,892	3,842	3,839
Financial investments:
Liquid debt assets	26,496	28,808	28,065
Illiquid debt assets	7,634	8,568	8,199
Shares	19,099	17,562	17,378
Other financial investments	33,313	27,928	30,491
Total financial investments *)	86,542	82,866	84,133
Cash and cash equivalents	5,011	4,552	4,418
Other **)	1,393	2,879	1,622
Total assets for yield-dependent contracts	96,838	94,139	94,012

*) Fair value through profit and loss

**) The balance includes mainly collectible premiums, reinsurer balances, collateral for activity in forward contracts and outstanding securities transactions as of the date of the financial statements.

2. Details of other financial investments

	As of September 30, 2024
	Fair value through profit and loss	Available for-sale		Loans and receivables	Total
In NIS million		Unaudited
Liquid debt assets (a)		202	5,859		‐ 6,061
Illiquid debt assets (b)		27		‐ 25,606	25,633
Shares (c)		‐	1,755		‐ 1,755
Other (d)		646	5,478		‐ 6,124
Total other financial investments		875	13,092	25,606	39,573

	As of September 30, 2023
	Fair value through profit and loss	Available for-sale		Loans and receivables	Total
In NIS million Unaudited
Liquid debt assets (a)		140	5,942		‐ 6,082
Illiquid debt assets (b)		27		‐ 24,424	24,451
Shares (c)		‐	1,675		‐ 1,675
Other (d)		315	4,798		‐ 5,113
Total other financial investments		482	12,415	24,424	37,321

	As of December 31, 2023
	Fair value through profit and loss	Available for-sale	Loans and receivables	Total
In NIS million	Audited
Liquid debt assets (a)		195 6,212		‐ 6,407
Illiquid debt assets (b)		28	‐ 24,444	24,472
Shares (c)		‐ 1,647		‐ 1,647
Other (d)		926 4,820		‐ 5,746
Total other financial investments		1,149 12,679	24,444	38,272

A. Liquid debt assets - composition

	As of September 30, 2024 Carrying Amortized
	amount	cost 1)
In NIS million		Unaudited
Government bonds		3,136	3,310
Other debt assets
Other non-convertible debt assets		2,900	3,031
Other convertible debt assets		25	29
		2,925	3,060
Total liquid debt assets		6,061	6,370
Impairments carried to profit and loss (cumulative)		2

	As of September 30, 2023
	Carrying amount	cost 1)	Amortized
In NIS million		Unaudited
Government bonds		3,085	3,273
Other debt assets
Other non-convertible debt assets		2,970	3,091
Other convertible debt assets		27	32
		2,997	3,123
Total liquid debt assets		6,082	6,396
Impairments carried to profit and loss (cumulative)		2

	As of December 31, 2023
	Carrying amount	cost 1)	Amortized
In NIS million		Audited
Government bonds		3,131	3,247
Other debt assets
Other non-convertible debt assets		3,251	3,299
Other convertible debt assets		25	29
		3,276	3,328
Total liquid debt assets		6,407	6,575
Impairments carried to profit and loss (cumulative)		2

1) Amortized cost - cost less principal payments, plus (minus) cumulative amortization according to the effective interest method of any difference between the cost and the repayment amount and less any amortization for impairment recognized in profit and loss.

**B. Illiquid debt assets - composition *)**

	As of September 30, 2024
	Carrying amount		Fair value
In NIS million		Unaudited
Government bonds
Hetz bonds and treasury deposits	17,211		21,840
Other non-convertible debt assets, excluding deposits with banks	7,995		8,077
Deposits with banks		427	436
Total illiquid debt assets	25,633		30,353
Impairments carried to profit and loss (cumulative)		35

	As of September 30, 2023
	Carrying amount	Fair value
In NIS million	Unaudited
Government bonds
Hetz bonds and treasury deposits	16,800	22,695
Other non-convertible debt assets, excluding deposits with banks	7,068	7,047
Deposits with banks		583 593
Total illiquid debt assets	24,451	30,335
Impairments carried to profit and loss (cumulative)		45

	As of December 31, 2023
	Carrying amount		Fair value
In NIS million	Audited
Government bonds
Hetz bonds and treasury deposits		16,634	22,279
Other non-convertible debt assets, excluding deposits with banks		7,287	7,297
Deposits with banks		551	566
Total illiquid debt assets		24,472	30,142
Impairments carried to profit and loss (cumulative)		42

*) The fair value of designated bonds was calculated in accordance with the repayment date of guaranteed return liabilities. The fair value of treasury deposits was calculated in accordance with the contractual repayment date.

C. Shares

	As of September 30, 2024
	Carrying amount	Cost
In NIS million	Unaudited
Liquid shares	932	872
Illiquid shares	823	893
Total shares	1,755	1,765
Impairments carried to profit and loss (cumulative)	342

		As of September 30, 2023
	Carrying amount	Cost
In NIS million		Unaudited
Liquid shares	865	891
Illiquid shares	810	838
Total shares	1,675	1,729
Impairments carried to profit and loss (cumulative)	293

		As of December 31, 2023
	Carrying Cost amount
In NIS million	Audited
Liquid shares	897	910
Illiquid shares	750	833
Total shares	1,647	1,743

Impairments carried to profit and loss (cumulative) 330

D. Other financial investments 1)

	As of September 30, 2024
	Carrying amount	Cost
In NIS million		Unaudited
Liquid financial investments	846	793
Illiquid financial investments	5,278	3,626
Total other financial investments	6,124	4,419
Impairments carried to profit and loss (cumulative)	110

	As of September 30, 2023
	Carrying amount	Cost
In NIS million	Unaudited
Liquid financial investments	531	508
Illiquid financial investments	4,582	3,139
Total other financial investments	5,113	3,647
Impairments carried to profit and loss (cumulative)	143

	As of December 31, 2023
	Carrying Cost amount
In NIS million	Audited
Liquid financial investments	923	887
Illiquid financial investments	4,823	3,342
Total other financial investments	5,746	4,229
Impairments carried to profit and loss (cumulative)	125

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

Appendix 2 - Interest income 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 For the three months ended September 30, 2024 September 30, 2023
	Average balance (1)	Interest income (expenses)	% of income (expense)	Average balance (1)	Interest income (expenses)	% of income (expense)
In NIS million			Per centage			Per centage
Interest-bearing assets
Credit to private individuals (2)	9,780	275	11.25	9,266	263	11.35
Commercial credit (2)(5)	3,472		52 5.99	3,561	54	6.07
Total credit	13,252	327	9.87	12,827	317	9.89
Deposits with banks	577		6 4.16	600	5	3.33
Other assets	73		-	‐ 1	-	‐
Total assets	13,902	333	9.58	13,428	322	9.59
Non-interest-bearing receivables for credit card transactions	5,045			4,635
Amounts receivable for credit card activity	1,129			1,082
Other non-interest-bearing assets (3)	511			458
Total assets	20,587			19,603
Interest bearing liabilities
Credit from banking corporations	5,347	(91)	(6.81)	5,063	(85)	(6.72)
Bonds and subordinated notes	819	(12)	(5.86)	672	(11)	(6.55)
Other liabilities	24	(24)		‐ 39	(24)	‐
Total interest-bearing liabilities	6,190	(127)	(8.21)	5,774	(120)	(8.31)
Payables for credit card activity (5)	11,662			11,371
Other non-interest-bearing liabilities (6)	785			691
Total liabilities	18,637			17,836
Total capital resources	1,950			1,767
Total capital commitments
and resources	20,587			19,603
Interest rate spread			1.37			1.28
Net return on interest-bearing assets (4)	13,902	206	5.93	13,428	202	6.02

(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 – net interest income 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 nine months ended For the nine months ended September 30, 2024 September 30, 2023
	Average balance (1)	Interest income (expenses)	% of income (expense)	Average balance (1)	Interest income (expenses)	% of income (expense)
			Per			Per
In NIS million			centage			centage
Interest-bearing assets
Credit to private individuals (2)	9,512	789	11.06	9,006	745	11.03
Commercial credit (2)(5)	3,416	152	5.93	3,440	150	5.81
Total credit	12,928	941	9.71	12,446	895	9.59
Deposits with banks	598	16	3.57	591	13	2.93
Other assets	66	1	2.02	5	-	‐
Total assets	13,592	958	9.40	13,042	908	9.28
Non-interest-bearing receivables for credit card transactions	4,636			4,436
Amounts receivable for credit card activity	1,125			1,100
Other non-interest-bearing assets (3)	469			480
Total assets	19,822			19,058
Interest bearing liabilities
Credit from banking corporations	5,093	(254)	(6.65)	5,177	(237)	(6.10)
Bonds and subordinated notes	802	(35)	(5.82)	554	(23)	(5.54)
Other liabilities	40	(68)		‐ 30	(61)	‐
Total interest-bearing liabilities	5,935	(357)	(8.02)	5,761	(321)	(7.43)
Payables for credit card activity (5)	11,229			10,897
Other non-interest-bearing liabilities (6)	741			673
Total liabilities	17,905			17,331
Total capital resources	1,917			1,727
Total capital commitments and resources	19,822			19,058
Interest rate spread			1.38			1.85
Net return on interest-bearing assets (4)	13,592	601	5.90	13,042	587	6.00

(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 – net interest income 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.

Average balances and interest rates - additional information on interest-bearing assets and liabilities

	For the three months ended September 30, 2024			For the three months ended September 30, 2023
	Average balance (1)	Interest income (expenses)	% of income (expense)	Average balance (1)	Interest income (expenses)	% of income (expense)
In NIS million			Per centage			Per centage
Non-linked NIS
Total interest-bearing assets	13,024	307	9.43	13,283	321	9.67
Total interest-bearing liabilities	5,653	(116)	(8.21)	5,713	(120)	(8.40)
Interest rate spread			1.22			1.27
CPI-linked NIS
Total interest-bearing assets	803	25	12.45	64	1	6.25
Total interest-bearing liabilities	525	(11)	(8.38)	61	-	‐
Interest rate spread			4.07			6.25
Foreign currency (including foreign-currency linked NIS)
Total interest-bearing assets	75	1	5.33	81	-	‐
Total interest-bearing liabilities	12	-	‐	-	-	‐
Interest rate spread			5.33			‐
Total activity
Total interest-bearing assets	13,902	333	9.58	13,428	322	9.59
Total interest-bearing liabilities	6,190	(127)	(8.21)	5,774	(120)	(8.31)
Interest rate spread			1.37			1.28

	For the three months ended September 30, 2024			For the three months ended September 30, 2023
	Average balance (1)	Interest income (expenses)	% of income (expense)	Average balance (1)	Interest income (expenses)	% of income (expense)
In NIS million			Per centage			Per centage
Non-linked NIS
Total interest-bearing assets	13,045	915	9	12,893	902	9
Total interest-bearing liabilities	5,660	(341)	(8)	5,684	(319)	(7)
Interest rate spread			1.32			1.85
CPI-linked NIS
Total interest-bearing assets	482	42	12	75	5	9
Total interest-bearing liabilities	270	(16)	(8)	75	(2)	(4)
Interest rate spread			3.72			5.33
Foreign currency (including foreign-currency linked NIS)
Total interest-bearing assets	65	1	2	74	1	2
Total interest-bearing liabilities	5	-	‐	2	-	‐
Interest rate spread			2.05			1.80
Total activity
Total interest-bearing assets	13,592	958	9	13,042	908	9
Total interest-bearing liabilities	5,935	(357)	(8)	5,761	(321)	(7)
Interest rate spread			1.38			1.85

(1) Based on beginning-of-month balances.

	For the three months ended September 30, 2024 compared to the three months ended September 30, 2023
In NIS million	Increase (decrease) due to change
	Quantity	Price		Net change
Interest-bearing assets
Credit to private individuals		14	(2)	12
Commercial credit		(1)	(1)	(2)
Total credit		13	(3)	10
Deposits with banks		-	1	1
Other assets		-	-	-
Total interest income		13	(2)	11
Interest bearing liabilities
Credit from banking corporations		(5)	(1)	(6)
Bonds and subordinated notes		(2)	1	(1)
Other liabilities		4	(4)	‐
Total interest income		(3)	(4)	(7)
Total interest income (expenses), net		10	(6)	4

Analysis of changes in interest income and expenses

	For the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023
In NIS million	Increase (decrease) due to change
	Quantity	Price		Net change
Interest-bearing assets
Credit to private individuals		42	2	44
Commercial credit	(1)		3	2
Total credit		41	5	46
Deposits with banks		-	3	3
Other assets		1	-	1
Total interest income		42	8	50
Interest bearing liabilities
Credit from banking corporations		4	(21)	(17)
Bonds and subordinated notes	(11)		(1)	(12)
Other liabilities	(17)		10	(7)
Total interest income	(24)		(12)	(36)
Total interest income (expenses), net		18	(4)	14

Clal Insurance Enterprises Holdings Ltd. Separate Financial Data from the Consolidated Interim Financial Statements Attributable to the Company as of September 30, 2024 (Regulation 38D) (Unaudited)

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Kost Forer Gabbay & Kasierer

144 Menachem Begin St., Tel Aviv 6492102 Tel. +972 3 623 2525 Fax +972 3 562 2555 ey.com

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

Attn.

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 reviewed the separate interim financial information provided 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 September 30, 2024 and for the nine- and three-month periods then ended. 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 these interim periods based on our review.

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 matters, 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 Separate Interim 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, November 28, 2024

Somekh Chaikin Certified Public Accountants Kost Forer Gabbay & Kasierer Certified Public Accountants Joint Independent Auditors

A member firm of Ernst & Young Global Limited KPM G Somek h Chaik in is a partners h ip regis tere d in Is rael and a m e m b e r firm of the KPM G global network of independen t firms affiliated with K P M G Internat io na l Limited, a limited liability Englis h c ompany

Interim Data on Financial Position

	As of September 30		As of December 31
	2024	2023	2023
In NIS million	Unaudited		Audited
Assets
Investment in investees	9,561	8,321	8,418
Loans and balances of investees	1,029	692	704
Receivables and debit balances	1	1	‐
Other financial investments:
Liquid debt assets	20	405	906
Shares	21	17	17
Other	99	86	87
Total other financial investments	140	508	1,011
Cash and cash equivalents	10	5	9
Total assets	10,741	9,527	10,142
Equity
Share capital	167	167	167
Share premium	2,397	2,390	2,390
Capital reserves	1,213	1,084	1,005
Retained earnings	5,403	4,833	5,019
Total equity	9,180	8,474	8,581
Liabilities
Payables and credit balances	40	32	45
Balances of investees	1	1	1
Current tax liability	‐	3	‐
Financial liabilities	1,520	1,017	1,514
Total liabilities	1,561	1,053	1,561
Total equity and liabilities	10,741	9,527	10,142

The attached additional information is an integral part of the Company's Interim Separate Financial Information.

November 28, 2024
Approval date of the financial statements	Haim Samet	Yoram Naveh	Eran Czerninski
	Chairman of the Board	CEO	Executive Vice President
			Head of the Finance Division

Interim Profit and Loss Data

	For the nine-month period ended September 30		For the three-month period ended September 30		For the year ended December 31
	2024	2023	2024	2023	2023
In NIS million	Unaudited				Audited
Company's share in the profits of investees, net of tax	401	21	134	118	206
Investment income, net and finance income
From investees	35	33	14	10	39
Other	14	17	2	5	24
Total revenues	450	71	151	132	269
General and administrative expenses	9	13	3	3	16
Finance expenses	60	18	20	10	33
Total expenses	68	31	23	13	49
Income before income tax	382	40	128	119	220
Income tax expense (tax benefit)	‐	1	‐	(3)	‐
Income for the period	382	39	128	121	220

The attached additional information is an integral part of the Company's Interim Separate Financial Information.

Interim Comprehensive Income Data

	For the nine-month period ended September 30		For the three-month period ended September 30		For the year ended December 31
	2024	2023	2024	2023	2023
In NIS million		Unaudited			Audited
Income for the period	382	39	128	121	220
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 in respect of investees that was transferred or will be transferred to profit and loss, net of tax	208	164	143	29	84
Other comprehensive income for the period carried or to be carried to profit and loss, before tax	208	164	143	29	84
Taxes (tax benefit) in respect of other components of comprehensive income (loss)	‐	‐	‐	‐	‐
Other comprehensive income items that, subsequent to initial recognition in comprehensive income, were or will be carried to profit and loss, net of tax	208	164	143	29	84
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 for the period	209	164	143	29	85
Total comprehensive income for the period	591	203	271	151	305

The attached additional information is an integral part of the Company's Interim Separate Financial Information.

Interim Data on Changes in Cash Flows

	For the nine-month period ended September 30		For the three-month period ended September 30		For the year ended December 31
	2024	2023	2024	2023	2023
In NIS million			Unaudited		Audited
Cash flows provided by operating activities
Income for the period	382	39	128	121	220
Adjustments:
Company's share in investees' losses	(401)	(21)	(134)	(118)	(206)
Dividend from investees	67	17	67	‐	25
Interest accrued on deposits with banks	‐	(9)	‐	‐	(9)
Interest accrued on the capital note for the investee	(25)	(25)	(14)	(10)	(31)
Accrued interest and deduction of issuance costs and
discount for bonds	59	18	20	10	33
Loss from other financial investments	(11)	(7)	(1)	(4)	(14)
Income tax	‐	1	‐	(3)	‐
Total adjustments	(311)	(26)	(64)	(125)	(203)
Changes in other items in the data on financial position, net:
Change in payables and credit balances	(2)	(6)	(2)	(4)	(5)
Total changes in other items in the data on financial position, net	(2)	(7)	(2)	(4)	(6)
Cash received during the period for:

Net cash provided by operating activity for transactions with investees	(1)	8	(2)	5	3
Interest received	1	9	‐	‐	9
Paid income tax	‐	(8)	‐	(4)	(9)

Net cash provided by (used for) operating activities	69	14	61	(5)	15
Cash flows provided by investing activities
Repayment of interest from the capital note to the investee	‐	‐	‐	‐	23
Investment in investees 2)	(891)	(1,273)	‐	(18)	(1,294)
Investment in available-for-sale financial assets	(95)	(413)	(62)	(401)	(908)
Proceeds from sale of available -for-sale financial assets	976	106	‐	20	106
Net cash used for investing activities	(9)	(1,579)	(62)	(400)	(2,072)
Cash flows provided by financing activities
Interest paid on the bonds	(59)	‐	‐	‐	‐
Proceeds of bond issuance (less issuance expenses)	‐	1,042	‐	401	1,537
Net cash provided by (used for) financing activities	(59)	1,042	‐	401	1,537

Increase (decrease) in cash and cash equivalents	1	(523)	(1)	(4)	(520)
Cash and cash equivalents as of the beginning of the period	9	529	11	9	529
Cash and cash equivalents as of the end of the period	10	5	10	5	9

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 September 30, 2024 (hereinafter - the "Consolidated Interim Financial Statements ").

2. Investment in CIMax and full repayment of the syndicated loan

In February 2024, the Company transferred to CIMax a total of approx. NIS 891 million. (Of that amount, a total of approx. 600 is with respect to an investment in CIMax and the balance against capital notes issued to the Company by CIMax). The capital notes do not bear interest or linkage and will be repayable after 5 years, at the lender's discretion. On the same date, CIMax used the proceeds for full early repayment of the syndicated loan (for further details, see Note 6(c)(b) to the Consolidated Interim Financial Statements).

3. Share-based payment

For details regarding the option plan published by the Company subsequent to the report date, see Note 12(c) to the Consolidated Interim Financial Statements.

4. Dividend distribution by the Company

For further details, see Note 7(b) 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 September 30, 2024 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:

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 quarterly Report on the Effectiveness of Internal Control over Financial Reporting and the disclosure attached to the quarterly report for the period ended June 30, 2024 (hereinafter - the "Most Recent Quarterly Report of Internal Control"), the internal control was found to be 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 Quarterly Report over Internal Control.

As of the report date, based upon the said Last Quarterly Internal Control Report, and based upon information brought to the attention of Management and the Board of Directors as stated above, the internal controls are 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 third quarter of 2024 (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. I have evaluated the effectiveness of internal control over financial reporting and disclosure, and have presented in this report the conclusions of the Board of Directors and management regarding the effectiveness of the said internal control as of the date of the reports.

Nothing in the foregoing shall derogate from my responsibility or the responsibility of any other person, under any law.

Yoram Naveh CEO

November 28, 2024

Certification by Officers Certification by the Most Senior Financial Officer

I, Eran Czerninski, hereby declare that:

1. I have reviewed Interim Financial Statements and other financial information included in the interim report of Clal Insurance Enterprises Holdings Ltd. (hereinafter - the "Corporation") for the third quarter of 2024 (hereinafter – the "Reports");
1. To my knowledge, the financial statements and financial information 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 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 design or operation of internal control over financial reporting and disclosure insofar as it relates to the financial statements and other financial information included in the 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. My assessment of the effectiveness of internal control over financial reporting and disclosure, insofar as it relates to the financial statements and other financial information included in the Reports as of the Reports' date. My conclusions regarding my aforesaid assessment have been presented to the Board of Directors and management and are included in this report.

Nothing in the foregoing shall derogate from my responsibility or the responsibility of any other person, under any law.

Eran Czerninski Executive Vice President Head of the Finance Division

November 28, 2024

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 September 30, 2024 (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 disclosure¹ and internal control over financial¹ 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 fourth 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

November 28, 2024

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 Czerninski, hereby declare that:

1. I have reviewed the quarterly report of Clal Insurance Company Ltd. (hereinafter the "Company") for the quarter ended September 30, 2024 (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 disclosure¹ and internal control over financial¹ 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 fourth 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 Czerninski

Executive Vice President Head of the Finance Division

November 28, 2024

^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, Ron Fainaro, hereby declare that:

1. I have reviewed the quarterly report of Max It Finance Ltd. (hereinafter the "Company") for the quarter ended September 30, 2024 (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 at the dates and for the dates 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 reporting,(1) and-
2. A. We have established verification procedures or have ensured they are carried out under our supervision, which are intended to ensure that material information referring to the Company, including its consolidated companies, should be brought to our attention by others in the Company and by those companies, in particular during the time the report was being prepared;
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.

Ron Fainaro CEO

November 28, 2024

(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 September 30, 2024 (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 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 reporting,(1) and-
2. A. We have established verification procedures or have ensured they are carried out under our supervision, which are intended to ensure that material information referring to the Company, including its consolidated companies, should be brought to our attention by others in the Company and by those companies, in particular during the time the report was being prepared;
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

November 28, 2024

⁽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 June 30, 2024

	Special Independent Auditor's Report	5-6
1.	Overview and Disclosure Requirements	5-8
	Economic Solvency Regime 1.1.	5-8
	Disclosure and Reporting Provisions in connection with Economic Solvency Ratio Report 1.2.	5-9
	Provisions during the Transitional Period 1.3.	5-9
	Definitions 1.4.	5-9
	Calculation Methodology 1.5.	5-11
	Comments and clarifications 1.6.	5-13
2.	Economic solvency ratio and minimum capital requirement (MCR)	5-15
	Solvency ratio 2.1.	5-15
	Minimum capital requirement 2.2.	5-17
3.	Economic balance sheet	5-17
	Information about economic balance sheet 3.1.	5-18
	Composition of liabilities in respect to insurance contracts and investment contracts 3.2.	5-22
4.	Shareholders' equity in respect of SCR	5-23
5.	Solvency capital requirement (SCR)	5-25
6.	Minimum capital requirement (MCR)	5-26
	Minimum capital requirement (MCR) 6.1.	5-26
	Shareholders' equity for MCR 6.2.	5-26
7.	Effect of the application of the directives for the Transitional Period	5-27
8.	Restrictions on dividend distribution	5-27
	Dividend 8.1.	5-27
	Capital management and dividend distribution policies 8.2.	5-28
	Solvency ratio without applying the Provisions for the Transitional Period 8.3.	5-28

Topic Page

ey.com

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

To: Board of Directors of Clal Insurance Company Ltd.

Dear Sir/Madam,

Re: Independent auditor's report on the Solvency II-based Economic Solvency Ratio Report of Clal Insurance Company Ltd. (hereinafter - the "Company") as of June 30, 2024

Introduction

We have performed the procedures set out below regarding the Solvency II-based Economic Solvency Ratio Report of the Company as of June 30, 2024 (hereinafter - the "Report" or the "Solvency Ratio Report"). Our report refers only to solvency ratio calculations and the presentation method of the Solvency Ratio Report and does not refer to any other activity of the Company.

Responsibility

The Board of Directors and management are responsible for the preparation and presentation of the Report in accordance with the directives of the Commissioner of the Capital Market, Insurance and Savings (hereinafter - the "Commissioner") regarding the Solvency II-Based Provisions of the Economic Solvency Regime for Insurance Companies as set out in Chapter 2, Part 2, Section 5 of the consolidated circular and the related guidelines (hereinafter collectively - the "Commissioner's 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. This responsibility includes the selection and application of appropriate methods for the preparation of the information and the use of assumptions and estimates for individual disclosures, which are reasonable under the circumstances. Moreover, this responsibility includes the planning, implementation, and maintenance of systems and processes relevant to preparation of the information in a manner that does not include material misstatement.

Our responsibility is to express a conclusion on the preparation and presentation of the calculation of the Solvency Ratio Report in accordance with the Commissioner's Directives based on the procedures set out below.

Review Scope

We conducted our engagement in accordance with the principles of International Standard on Assurance Engagements (ISAE) 3000 (Revised), Assurance Engagements Other than Audits or Reviews of Historical Financial Information published by the IAASB, and in accordance with the Commissioner's Directives as included in Chapter 7, Section 5, Part 1 to the Consolidated Circular - Independent Auditor - which lists directives regarding review of a quarterly Economic Solvency Ratio Report. The work procedures included the procedures set out below, to assess whether the Company's calculations for this subject, as of June 30, 2024, in all material respects, do not comply with the Commissioner's Directives. However, we do not provide a separate conclusion for each disclosure.

The work procedures included the following procedures:

Review of the Solvency Ratio Report and the explanations in the Report;
Clarifications, mainly with those responsible for producing the Solvency Ratio Report and calculations for the solvency ratio; including clarifications for the material changes in the models, methodologies, calculation processes, and systems;
Review of material changes in studies affecting the Report;
Performing analytical review procedures, including assessing the likelihood of the material changes in the main sections of the Report.

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

Our work is substantially smaller in scope than an audit performed pursuant to generally accepted auditing standards 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.

We did not examine the Deduction during the Transitional Period as of June 30, 2024, as presented in Section 3.1.2 - Except for the above work procedures verifying that the Deduction Amount does not exceed the expected discounted amount of the risk margin and the solvency capital requirement 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 capital requirement, 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.

Conclusion

Based on the procedures performed, nothing has come to our attention that causes us to believe that the calculation of the solvency ratio and the presentation of the Company's Solvency Ratio Report for June 30, 2024, are not prepared in accordance with the Commissioner's Directives, in all material respects.

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, which 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 that stated in Section 1.6, comments and clarifications regarding the solvency ratio, the uncertainty arising from regulatory changes, and exposure to contingent liabilities, the effect of which on the solvency ratio cannot be estimated, as well as regarding the uncertainty embodied in the actuarial and financial assumptions and forecasts used in the preparation of the Report.

Respectfully,

Tel Aviv November 27, 2024

Somekh Chaikin Certified Public Accountants Kost Forer Gabbay & Kasierer Certified Public Accountants Joint Independent Auditors

1. Overview and disclosure requirements

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").

1.1 Economic Solvency Regime

The Provisions of the Economic Solvency Regime are based on the provisions of Pillar I of the European Solvency II Directive, which were adapted to the domestic market and set a standard model for calculating eligible shareholders' equity and the regulatory solvency capital requirement (SCR), with the aim of bringing insurance companies to hold buffers to absorb losses that might arise from the materialization of unexpected risks to which they are exposed under a given probability. This regulatory framework is based on economic measurement of the Company's assets and liabilities and does not necessarily correspond to the presentation in accordance with generally accepted accounting principles according to which the Company prepares its financial statements. The solvency ratio is the ratio between the eligible shareholders' equity and the regulatory solvency capital requirement (hereinafter - "Solvency Ratio").

The eligible 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 by evaluating an insurance company's assets and liabilities in accordance with the circular's provisions, and Additional Tier 1 capital. 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.

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, takeup of pension benefits, and underwriting income rate), assumptions regarding future management actions, assumptions regarding the development pattern of the capital requirements and risk margin, riskfree interest rates, capital market returns, future income, 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. Furthermore, as part of the revision to the Consolidated Circular - The Independent Auditor Chapter - which was published on August 28, 2023, it was stipulated that a quarterly Economic Solvency Ratio Report1 will be reviewed by the independent auditor. 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, whereunder 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. The solvency capital requirement of an insurance company during the Transitional Period, to be calculated based on data as of December 31, 2023 and as of June 30, 2024, will not fall below 95% of the SCR.
1. Increasing the eligible capital by deducting from the insurance reserves an amount as detailed Section 3.1.2 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.

Furthermore, with respect to the composition of eligible shareholders' equity, it was stipulated that the maximum rate of Tier 2 capital in the Transitional Period shall stand at 50% of the solvency capital requirements during the Transitional Period.

1.3.1 Updating 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 as of June 30, 2024, and obtained the Commissioner's approval for the recalculation and for a deduction equal to NIS 4,164 million, before the deduction – see Section 3.1.2 below.

1.4 Definitions

The Company -	Clal Insurance Company Ltd.
The Commissioner -	The Commissioner of the Capital Market, Insurance and Savings.
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.

^1. As defined in the Appendix to the Economic Solvency Regime, Part C, Chapter 1, Appendix B.

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, noncumulative 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.
Symmetric Adjustment (SA) - Anti-cyclical component designed to adjust the capital requirement in respect of the shares risk to the changes in share prices, as detailed in Part C in the Provisions of the Economic Solvency Regime.
Solvency ratio - The ratio between the eligible shareholders' equity and the solvency capital requirement.
Best estimate - Expected future cash flows from insurance contracts and investment contracts throughout their term, without conservatism margins and discounted by an adjusted risk-free interest.
Economic balance sheet - The balance sheet of an insurance company in accordance with the Directives as per Section 3.2.
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 risk-weighted components -	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 between the operating segments in the portfolio and the 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.
Audited -	The term refers to an audit held in accordance International Standard on Assurance Engagement (ISAE) 3400 – "The Examination of Prospective Financial Information".
Unaudited -	The term refers to a review conducted in accordance with the principles of the International Standard on Assurance Engagements (ISAE) 3000, Assurance Engagements Other than Audits or Reviews of Historical Financial Information.
Transitional Period -	As part of the Provisions for the Transitional Period for the implementation of the Economic Solvency Regime, the insurance company receives a period, during which it is entitled to expedients with regard to the capital requirements or the calculation of the capital in accordance with the definition as per Section 1.3

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. Following 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, which 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 stated below: The economic balance sheet is prepared based on the Company's standalone financial statements plus investees, whose sole occupation is holding

real estate interests, 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. Furthermore, zero value is attributed to intangible assets and deferred acquisition costs (other than investment in Insuretech" as defined in the Solvency Circular according to the approval the Company received from the Commissioner in that respect).

As aforesaid, the Company opted for the current alternative provided by the Provisions for the Transitional Period, 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 Amount"). 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 balance of the deduction on each reporting date (hereinafter - the "Deduction Value during the Transitional Period") shall be recalculated every two years, and if a material change occurred in the risk profile or the business structure of the insurance company. Furthermore, the Deduction Value During the Transitional Period shall be proportionate to the expected increase in the solvency ratio calculated excluding reliefs during the Transitional Period - see Section 3.2.2 below.

1.5.3 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 risk-weighted 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 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.

The capital requirement in respect of each of the risks is calculated in accordance with the Company's exposure to that risk, taking into account the parameters set in the Provisions of the Economic Solvency Regime. In accordance with the Directives, the capital requirement represents the scope of own capital which 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.

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 report as of June 30, 2024 (hereinafter - the "Semi-Annual Report"). Any information or studies subsequent to the publication date of the Company's periodic report as of June 30, 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 on the publication date of the report as of June 30, 2024. Accordingly, this Report has not been revised to reflect the events which occurred subsequent to this date. For additional information on effects on the Company subsequent to this date and through the report publication date, see Sections 2.1 and 2.2 to the Report of the Board of Directors and Note 8 to the Interim Financial Statements as of September 30, 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 field of insurance 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 regarding 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, 2023, and in Section 4 to the Company's Report of the Board of Directors as of September 30, 2024.
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 2023, Note 7 to the financial statements as of June 30, 2024, 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 savings policies sold between 2004 and 2013, 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 that was 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; however, there is still uncertainty as to this effect, since, among other things, the Transitional Period has not yet ended.
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 It is noted that with regard to the new accounting standard (IFRS 17), which will implemented in Israel as from January 2025, there is still some uncertainty. For further details, see Note 9 to the Interim Financial Statements dated September 30, 2024. The manner of implementation may affect the method employed to calculate the Deduction in the Transitional Period. As of the date of this report, there is uncertainty as to this effect.
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 June 30, 2024 As of December 31, 2023
In NIS thousand	Unaudited	Audited
Shareholders' equity in respect of SCR - see Section 4	14,829,951	14,019,290
Solvency capital requirement (SCR) - see Section 5	8,888,132	8,975,784
Surplus	5,941,819	5,043,506
Economic solvency ratio (in %)	167%	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 (*)	(390,844)	291,524
Shareholders' equity in respect of SCR	14,439,107	14,310,814
Surplus	5,550,975	5,335,030
Solvency ratio (in %)	162%	159%

(*) On July 31, 2024, early redemption of Notes (Series J) was carried out, for a total of approx. NIS 455 million. This redemption reduces the eligible capital and the capital surplus by approx. NIS 391 million, since as of June 30, 2024 there is an unutilized Tier 2 capital balance of approx. NIS 64 million in excess of the Tier 2 capital cap (50% of the capital requirements in the Transitional Period).

In October 2023, the Iron Swords War broke out (hereinafter - the "War") in the State of Israel. The prolongation of the War led to a slowdown in the business activities in the Israeli economy, including, among other things, due to the closure of factories in the south and north of Israel, damage to infrastructures, drafting of reservists for an unknown period, placing employees on unpaid leave, and disruption of the economic activity in Israel. The continuation of the War may have widespread ramifications for many sectors and geographical regions in Israel, and, of course, also for the performance of the domestic financial markets, beyond the ramifications as of the report date.

As of the approval date of the Economic Solvency Ratio Report, the increase in the risk-free interest has a positive effect on the Company's economic solvency ratio; However, the Company is unable to reliably assess the future effect of the War on the Company's economic solvency ratio, among other things, due to the highly volatile markets, uncertainty as to the duration and intensity of the fighting, the effects of the War on the Company's areas of activity, and other exogenous factors, such as the financial markets, and regarding further measures to be taken by the government and/or the Bank of Israel. For details regarding the economic solvency ratio's sensitivity to various risk factors, see the Economic Solvency Ratio Report as of December 31, 2023.

For further information about the consequences of the Iron Swords War, see Section 8 to the interim financial statements a of September 30, 2024, and the Report of the Board of Directors for the period ended September 30, 2024.

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 8 below.

Key changes in the capital surplus and in the economic solvency ratio compared to December 31, 2023:

Financial effects, and in particular the increase in the risk-free interest rate curve resulted in a material 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.
Amendment to the Provisions of the Consolidated Circular regarding Measurement of Liabilities Revising the Demographic Assumptions in Life Insurance and Pension Funds resulted in a decrease of the capital and solvency ratio.
Following the change in the risk-free interest rate curve, the Company recently recalculated the Deduction Amount as of June 30, 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 8.1 below.

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.² The determination of the best estimate is supposed to 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").

As part of the further development and upgrade of the calculations, in the reporting period, the Company calculated, at the same time and based on a Stochastic Model, the best estimate of the cash flows from asymmetric insurance liabilities (including charging of future variable management fees³ ), whose impact - had it been included in the calculation of the economic solvency ratio as of June 30, 2024 - is estimated to be an increase of approx. 17% in the ratio, without taking into account the Provisions for the Transitional Period, and an increase of approx. 9% taking into account the Provisions for the Transitional Period.

In accordance with an outline that was received from 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.

As stated above, the Company completed the stochastic calculation based on an economic scenario generator,⁴ 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 internal controls.

^2. In Israel, the calculation of the embedded value is made in accordance with the rules and principles set by the Commissioner, who adopted the rules and principles stipulated under a report of a joint committee of the insurance companies and the Commissioner, which was supported by Israeli and foreign consultants.

^3. See Section 6.1.2.3 in the Report on the Corporation's Business of the Company.

^4. As defined in the provisions of Appendix B, Section 5 (Part 2, Appendix 2) to the Provisions of the Economic Solvency Regime.

2.2 Minimum capital requirement (MCR)

As of June 30, 2024	As of December 31, 2023 Audited 2,243,946
Unaudited
2,222,033
10,830,292	10,271,712

3. Economic balance sheet

		As of June 30, 2024		As of December 31, 2023
		Balance sheet according to accounting standards	Economic balance sheet	Balance sheet according to accounting standards	Economic balance sheet
NIS thousand	Extension clause	Unaudited	Unaudited	Audited	Audited
Assets:
Intangible assets	3	806,171	77,256	798,905	91,085
Deferred acquisition costs	4	1,977,905	-	1,941,135	-
Property, plant & equipment	8	166,265	148,504	166,395	146,102
Investments in investees that are not insurance companies:
Management companies	5	858,702	336,602	842,972	310,001
Other investees	5	72,292	70,135	72,148	68,936
Total investments in investees that are not insurance companies		930,994	406,737	915,120	378,937
Investment property in respect of yield-dependent contracts		3,876,691	3,876,691	3,838,728	3,838,728
Investment property - other		1,514,022	1,514,022	1,493,689	1,493,689
Reinsurance assets		3,808,071	2,894,202	3,805,186	3,023,560
Receivables and debit balances	13	2,520,745	2,520,745	2,916,133	2,916,133
Financial investments in respect of yield-dependent contracts		84,039,206	84,039,206	84,133,182	84,133,182
Other financial investments:
Liquid debt assets		5,999,218	5,999,218	6,321,705	6,321,705
Illiquid debt assets, excluding designated bonds	6	8,144,663	8,155,981	7,693,941	7,729,624
Designated bonds	7	14,669,432	18,453,273	14,441,158	19,346,207
Shares		1,715,650	1,715,650	1,645,575	1,645,575
Other		5,759,775	5,759,775	5,646,414	5,646,414
Total other financial investments		36,288,738	40,083,897	35,748,793	40,689,525
Cash and cash equivalents in respect of yield-dependent contracts		4,583,773	4,583,773	4,417,868	4,417,868
Other cash and cash equivalents		2,082,272	2,082,272	1,784,047	1,784,047
Other assets	14	323,436	598,143	328,019	602,389
Total assets			142,918,289 142,825,448 142,287,200 143,515,245
Total assets for yield-dependent contracts		93,999,149	94,013,397	94,008,373	94,073,890

3. Economic balance sheet (cont.)

		As of June 30, 2024		As of December 31, 2023
		Balance sheet		Balance sheet
		according to accounting standards	Economic balance sheet	according to accounting standards	Economic balance sheet
NIS thousand	Extension clause	Unaudited	Unaudited	Audited	Audited
Equity:
Basic Tier 1 capital		6,939,124	10,075,385	6,782,295	9,425,233
Total equity		6,939,124	10,075,385	6,782,295	9,425,233
Liabilities:
Liabilities in respect of insurance contracts and non-yield dependent investment contracts	1 , 10	32,025,089	26,476,418	31,705,888	28,046,483
Liabilities in respect of insurance contracts and yield-dependent investment contracts	1 , 10	92,655,433	90,190,607	91,674,816	89,914,670
Risk margin (RM)	9	-	6,294,247	-	6,865,632
Deduction during the Transitional Period	2	-	(2,882,595)	-	(4,115,103)
Liabilities in respect of deferred taxes, net	11	614,503	2,564,215	559,577	2,212,347
Payables and credit balances	13	4,722,049	4,601,459	6,076,610	5,958,647
Financial liabilities	12	5,566,266	4,966,274	5,093,716	4,661,328
Other liabilities	14	395,825	539,438	394,298	546,008
Total liabilities				135,979,165 132,750,063 135,504,905 134,090,012
Total equity and liabilities				142,918,289 142,825,448 142,287,200 143,515,245

Key changes compared with December 31, 2023:

For explanations regarding main changes in Tier 1 capital and significant effects on the economic solvency ratio's components, see Sections 2.1 above 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,⁵ 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.

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

^5. In Israel, the calculation of the embedded value is made in accordance with the rules and principles set by the Commissioner, who adopted the rules and principles stipulated under a report of a joint committee of the insurance companies and the Commissioner, which was supported by Israeli and foreign consultants.

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 2023 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. It should be noted that 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 is supposed to 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 SLT life and health insurance, the Company used real assumptions of each and every parameter, according to the expected value of each relevant factor, 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, the future cash flows refer to 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 different 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.).

Following 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) - 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 CPIlinked rate.

3.1.1.2.3 Operational assumptions (for life 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 and more. 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

Lapses (discontinuation of premium payment, settlement of policies, withdrawals).
Mortality of pensioners and planholders.
Morbidity (rate and length of claims) in long-term care, income protection and health products.
Takeup rates and pension tracks.

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 payment of claims in long-tail subsegments.

3.1.2 Extension Clause 2 - Deduction during the Transitional Period

The Deduction during the Transitional Period was recalculated as of June 30, 2024 as the total amount of the positive differences between insurance reserves (retention) as per the economic balance sheet including the risk margin (net of adjustment to the fair value of designated bonds) and the insurance reserves (retention) as of that date in accordance with the Financial Statements. These differences were calculated at product group level in accordance with the provisions included in the Letter of Principles.

Following the change in the risk-free interest rate curve in relation to the previous calculation date (December 2023), the Company recalculated the Deduction Amount as of June 30, 2024. The said deduction is amortized linearly for 13 years up to December 31, 2032, such that amortized balance that reflects 9 years as of June 30, 2024 is NIS 2,883 million.

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 Insuretech 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 a 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 a 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.6

^6. 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.

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 June 30, 2024
	Best estimate (BE) of liabilities
	Gross	Reinsurance	Retention
In NIS thousand	Unaudited
Liabilities in respect of insurance contracts and non-yield-dependent investment contracts:
SLT life insurance and long-term health insurance contracts	20,076,783	(245,326)	20,322,109
NSLT short-term property & casualty insurance and health insurance contracts	6,399,635	2,657,874	3,741,761
Total liabilities for insurance contracts and non-yield-dependent investment contracts	26,476,418	2,412,548	24,063,870
Liabilities in respect of insurance contracts and yield-dependent investment contracts - SLT life insurance and long-term health insurance contracts	90,190,607	481,654	89,708,953
Total liabilities in respect of insurance contracts and investment contracts	116,667,025	2,894,202	113,772,823

	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

Key changes compared with December 31, 2023:

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 inflation in the first half, 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

	As of June 30, 2024
In NIS thousand	Unaudited
	Tier 1 capital
	Additional
	Basic Tier 1 capital	Tier 1 capital	Tier 2 capital	Total
Shareholders' equity	10,075,385	457,874	4,508,400	15,041,659
Deductions from Tier 1 capital (a)	(147,374)	-	-	(147,374)
Deductions (b)	-	-	-	-
Deviation from quantitative limitations (c)	-	-	(64,334)	(64,334)
Shareholders' equity in respect of SCR (d)	9,928,011	457,874	4,444,066	14,829,951
Of which - expected profits in future premiums (EPIFP) after tax	5,795,080			5,795,080

In NIS thousand	As of December 31, 2023 Audited

	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

Key changes compared with December 31, 2023:

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 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 rates in risk products and savings products led to a decrease in the Company's capital.
Following the change in the risk-free interest rate curve, the Company recently recalculated the Deduction Amount as of June 30, 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. For details regarding the dividend declared subsequent to the reporting date, see Section 8.1 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.
- As of June 30, 2024 As of December 31, 2023 In NIS thousand Unaudited Audited Tier 1 capital: Basic Tier 1 capital net of deductions 9,928,011 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 457,874 464,960 Less deduction due to deviation from quantitative limit - - Additional Tier 1 capital 457,874 464,960 Total Tier 1 capital 10,385,885 9,822,922 Tier 2 capital: Additional Tier 1 capital that was not included in Tier 1 - - Tier 2 capital instruments 4,508,400 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 (64,334) - Total Tier 2 capital 4,444,066 4,196,368 Total shareholders' equity in respect of SCR 14,829,951 14,019,290
(d) Composition of shareholders equity in respect of SCR -

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 Provisions for the Transitional Period, during the period through December 31, 2032, the Tier 2 capital shall not exceed 50% of SCR.

5. Solvency capital requirement (SCR)

	As of June 30, 2024	As of December 31, 2023
	Unaudited	Audited
In NIS thousand	Capital requirement
Basic solvency capital requirement (BSCR):
Capital requirement in respect of market risk-weighted component	6,658,933	6,036,036
Capital requirement in respect of counterparty risk-weighted component	294,520	324,871
Capital requirement in respect of underwriting risk-weighted component in life insurance	4,181,128	4,295,539
Capital requirement in respect of underwriting risk component in health insurance (SLT+NSLT)	4,394,716	4,595,749
Capital requirement in respect of underwriting risk-weighted component in P&C insurance	1,024,613	1,028,301
Total	16,553,910	16,280,496
Effect of diversification of risk-weighted components	(5,330,256)	(5,338,095)
Capital requirement in respect of the intangible assets risk-weighted component	38,629	45,544
Total basic solvency capital requirement (BSCR)	11,262,283	10,987,945
Capital requirement in respect of operational risk	377,102	391,451
Loss absorption adjustment due to deferred tax asset	(2,987,045)	(2,635,176)
Capital requirement in respect management companies:
Clal Pension and Provident Funds Ltd.	227,435	223,222
Atudot Pension Fund for Salaried Employees and Self-Employed Ltd.	8,357	8,342
Total capital requirement in respect management companies	235,792	231,564
Total solvency capital requirement (SCR)	8,888,132	8,975,784

Key changes in solvency capital requirement compared to December 31, 2023:

Increase in capital requirements in respect of market risks arising mainly 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.
An increase in the risk-free interest rate curve caused a decrease in insurance capital requirements.

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 report date;
With regard to existing businesses, it will only cover unexpected losses;
Reflects the scope of own capital 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 June 30, 2024	As of December 31, 2023
In NIS thousand	Unaudited	Audited
Minimum capital requirement according to MCR formula	2,012,564	2,004,396
Lower band (25% of solvency capital requirement in the Transitional Period)	2,222,033	2,243,946
Upper band (45% of solvency capital requirement in the Transitional Period)	3,999,660	4,039,103
Minimum capital requirement (MCR)7	2,222,033	2,243,946

6.2 Shareholders' equity for MCR

In NIS thousand	As of June 30, 2024 Unaudited

	Shareholders' equity in respect of SCR according to Section 4	10,385,885	4,444,066	14,829,951
Deviation from quantitative limitations due to minimum capital requirement *)	-	(3,999,659)	(3,999,659)
Shareholders' equity for MCR	10,385,885	444,407	10,830,292

	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.

^7. 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 Provisions for the Transitional Period 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 June 30, 2024
		Unaudited
NIS thousand	Including applying the Transitional Provisions 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)	120,078,677	(2,882,595)	-	122,961,272
Basic Tier 1 capital	9,928,011	1,880,893	-	8,047,118
Shareholders' equity in respect of SCR	14,829,951	1,480,238	888,812	12,460,901
Solvency capital requirement (SCR)	8,888,132	(1,001,640)	-	9,889,772

	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 Transition al 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

Key changes compared with December 31, 2023:

• A recalculation of the Deduction Amount as of June 30, 2024 led to a decrease in the effect of the inclusion of the Deduction during the Transitional Period.

8. 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 such that it is able 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.

8.1 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 Provisions for the Transitional Period 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 Provisions for the Transitional Period 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.

8.2 Capital 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 Provisions for the Transitional Period 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 during the Transitional Period until the end of 2032 and thereafter.

It is hereby clarified that this policy should not be viewed as an undertaking by the Company to distribute dividends.

8.3 Solvency ratio without applying the Provisions for the Transitional Period:

	As of June 30, 2024	As of December 31, 2023
In NIS thousand	Unaudited
Shareholders' equity in respect of SCR	12,460,901	11,267,843
Solvency capital requirement (SCR)	9,889,772	10,382,676
Surplus	2,571,129	885,167
Economic solvency ratio (in %)	126%	109%
Effect of material capital-related measures 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	12,460,901	11,267,843
Surplus	2,571,129	885,167
Economic solvency ratio (in %)	126%	109%
The Board of Directors' economic solvency ratio target (percentages)	110%	110%

(*) On July 31, 2024, early redemption of Notes (Series J) was carried out, for a total of approx. NIS 455 million. This redemption does not affect the capital surplus and the economic solvency ratio, since as of June 30, 2024 there is an unutilized Tier 2 capital balance of approx. NIS 552 million in excess of the Tier 2 capital cap (40% of the capital requirements in a calculation without the Transitional Period).

Capital surplus (shortfall) relative to the target (NIS thousand) 1,582,152 (153,101)

Material changes compared with December 31, 2023:

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 Provisions for the Transitional Period.

November 27, 2024
Approval date of the	Haim Samet	Yoram Naveh	Eran Czerninski	Avi Ben Noon
financial statements	Chairman of the Board	CEO	Executive Vice President	Executive Vice President
			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

AI Terminal

Clal Insurance

6731_rns_2024-12-12_e322c65e-9147-4d5e-ba38-5c89bf410c7d.pdf

Clal Insurance Enterprises Holdings Ltd. Financial Statements as of September 30, 2024

IMPORTANT

Clal Insurance Enterprises Holdings Ltd.

Quarterly Report As of September 30, 2024

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

Table of Contents

Forward-looking information

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

1.1 Group structure

The Company's shareholders

1.2 The Group's Areas of Activity and Developments Therein

2. 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 policy and distribution

B. Solvency ratio and dividend distribution at Clal Insurance

C. Approval of Max's internal capital target, dividend distribution policy and dividend distribution

D. Capital markets and risk-free interest rate curve during the reporting period and thereafter

E. Repayment of syndicated loan by CIMax

F. Issuance of Subordinated Notes (replacement of Series J and expansion of Series M) in the subsidiary Clal Insurance

G. The Iron Swords War

Israel's credit rating

Effect on the financial statements

Cyber and information security risks

H. Share-based payment

I. Filing of a draft prospectus of Max

J. Agreement with the National Insurance Institute under the National Insurance Law

K. Changes to actuarial assumptions in the calculation of the liabilities for annuities

L. Expected material effects of IFRS 9 and IFRS 17 on capital and on the balance of the contractual service margin as of the transition date (hereinafter - the "Reporting Standards")

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

Summary of data from the Group's consolidated Financial Statements

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

A. The Company's results in the reporting period

Following are the key changes in the results compared with the corresponding period last year:

Insurance and savings without financial effects on reserves

Underwriting results and savings assets under management:

Investment income and the capital markets:

Revisions of actuarial assumptions:

Credit cards

Tax expenses

Return on equity

Assets under management

B. Company's results in the quarter

Insurance and savings without financial effects on reserves

Underwriting results and savings assets under management:

Investment income and the capital markets:

Credit cards

Return on equity

C. Amortization of excess cost at Max

2.2.1 Long-term savings

2.2.1.1 Life Insurance Subsegment

Comprehensive income:

Updates of assumptions of the actuarial models:

Financial effects, investment income and the capital markets:

Financial effects, investment income and the capital markets:

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

Policies issued from 2004 and thereafter (the new Fund J)

2.2.1.3 Provident funds subsegment

Contributions towards benefits - provident

2.2.1.4 The pension subsegment

Contributions towards benefits - pension

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

2.2.3 Health insurance

Premiums earned, gross:

Comprehensive income:

Individual long-term care:

Illnesses and long-term hospitalization:

Illnesses and short-term hospitalization:

2.2.4. Credit cards

2.2.4.1 Data by areas of activity - Max

2.2.4.2 Quantitative data regarding the credit card transactions

Definitions:

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

2.2.4.3 Key credit quality indicators

2.2.5 Other and items not included in the insurance and credit cards segments

2.2.6 Operating and general and administrative expenses and fees and commissions

Insurance and savings

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