2015 was filled with risk and uncertainty for financial markets. Both debt and equities markets experienced the highest fluctuations in recent years. On the other hand, vulnerability and volatility in financial markets also present opportunities to increase returns. Garanti Pension and Life managed to turn crisis into opportunity, especially in terms of equities. In 2015, the BIST 100 Index declined 7.5% while Garanti Pension and Life's Equity Fund outperformed the Index by five basis points. In addition, the Company invested heavily in international debt securities denominated in foreign currencies. As a result, Garanti Pension's Second Flexible Income Mutual Fund yielded a return of 25% in 2015, ranking among the top three mutual funds in the sector with the highest returns.

The private pension system continues to grow.

Thanks to legislative changes implemented in 2013, and the 25% state contribution in particular, Turkey's private pension system has expanded rapidly and maintained this growth momentum through 2015.

New regulations that will further boost growth are on the way.

New regulations on deductions will be introduced in order to encourage participation in the private pension system. Under the new regulation, which will take effect in 2016, the sum total of entry and management fees shall not exceed 8.5% of annual minimum gross wage; in addition, companies will not be able charge these fees after five years. Starting in 2021, a percentage of total fund expense deductions will be returned to participants; 2.5% after the sixth year and increasing by 2.5% annually. Some 15% of annual fund deductions will be returned to participants after the 15th year.

Garanti Pension: Cynosure of the Sector

Becoming the first company in the sector to reach 900 thousand participants, Garanti Pension and Life closed the year 2015 with a total of 993,000 participants. With TL 7.6 billion in funds and 15.6% market share, Garanti Pension continues its rapid growth.

The life insurance sector returned to positive growth after a one year lapse.

During the first half of 2014, the overall life insurance sector contracted year-on-year mainly due to the decline in consumer loans. However, as consumer lending picked up in 2015, the life insurance sector resumed growth. Despite these fluctuations experienced by the sector, Garanti Pension maintained steady growth over the past two years, thanks to its diversified products tailored to meet customer needs and the Company's customer-centric practices.

Income insurance products, designed to complement the private pension system, are scheduled to launch soon.

Rules concerning income insurance products, which will complement the private pension system and mean a "lifelong salary" for participants, were announced with a regulation dated April 2015. Income insurance products will launch in 2016 and create a new market for insurance providers.