To compute the expected loss, the outstanding balance has to be multiplied with the product of PD, EAD and LGD.
The probability of default can be calculated using the following formula:

$$PD = N\left[\frac{\ln(F) - \ln(V) - (\mu)T + 0.5\sigma^2 T}{\sigma\sqrt{T}}\right]$$

Where:
N = Cumulative normal distribution
F = face value of zero-coupon bond
V = value of the firm
T = time to maturity
σ = volatility of the firm's value

Note that we have not been provided the values for F and V but their ratio has been provided.
$\frac{V}{F} = 1.1$, therefore, $\frac{F}{V} = \frac{1}{1.1}$.

The expression $\ln(F) - \ln(V)$ can also be written as $\ln\left(\frac{F}{V}\right)$.

Hence:

$$PD = N\left[\frac{\ln\left(\frac{1}{1.1}\right) - (\mu)T + 0.5\sigma^2 T}{\sigma\sqrt{T}}\right]$$ $$= N\left[\frac{\ln\left(\frac{1}{1.1}\right) - (15\%)(5) + 0.5(19\%)^2(5)}{19\%\sqrt{5}}\right]$$ $$= N(-1.777) = 3.776\%$$