Vanquis Banking Group Plc · LSE:VANQ
Vanquis Banking — H1 2025 Earnings Presentation
42 slides from Vanquis Banking's earnings presentation, Aug 7, 2025
Slide 1: 2025 Half Year Results
QY vandquis The bank = that’s got _ your back , 2025 HALF YEAR RESULTS 7 AUGUST 2025 9AM vanquis.com
Slide 2: Agenda
Summary of 1H25 Tan McLaughlin 1H25 Performance Dave Watts Q&A Tan & Dave
Slide 3: Summary of 1H25
QM vandquis Summary of 1H25 Tan McLaughlin Chief Executive Officer
Slide 4: Profit delivered in 1H25
Profit delivered in 1H25 Two consecutive quarters of profitability and three consecutive quarters of balance growth While the strategic transformation of the bank continues, we have: 1. 2. Sustainably grown interest-earning balances and optimised mix to maximise return on deployed capital. Made stro
Slide 5: 1H25 Performance vs. FY25 Guidance
1H25 Performance vs. FY25 Guidance On track to deliver our FY25 Guidance, with higher balance growth than previously expected 1H25 Performance FY25 Guidance Gross customer interest earning balances! £2,459m >£2.6bn Net Interest Margin (NIM)? 17.4% >17% Cost: Income ratio 62.5% High 50s Return on Tan
Slide 6: 1H25 Highlights
1H25 Highlights Improving customer proposition with enhancements to risk management Customer proposition Insightful risk management What we have delivered * Launched new Credit Card product variants. * Enhanced credit decisioning in Vehicle Finance. * Maintained strong growth in Second Charge Mortga
Slide 7: 1H25 Highlights
1H25 Highlights Technology transformation and operational efficiency on track, supported by a strong team Technology transformation Operational efficiency What we have delivered Centralised customer data on a new IT platform. Launching a new mobile app and Credit Card onboarding and decisioning plat
Slide 8: New FOS fee charging structure
New FOS fee charging structure The revised FOS fee structure, implemented on 1 April 25, has reduced unmerited CMC complaint referrals to the FOS. Charging structure pre 1 April 2024 Lenders paid £750 per claim Vv Charging structure pre 1 April 2025 Lenders paid £650 per claim Vv New charging struct
Slide 9: Update on external factors
Update on external factors Clear distinction from Johnson case supports limited liability on motor finance commissions Update following Supreme Court Judgment and FCA’s intention to consult on a compensation scheme * The Group believes any liability is limited. + Under IAS 37, no provision has been
Slide 10: Vehicle Finance business transformation
Vehicle Finance business transformation Gateway will deliver a new customer onboarding and servicing platform by mid-2026 Customer need for Vehicle Financing “A car purchase for our customers is not a luxury - most customers need their car to go to work & provide for their family.” “The cost of a ca
Slide 11: 1H25 Financial Performance
QM vandquis 1H25 Financial Performance Dave Watts Chief Financial Officer
Slide 12: 1H25 Group performance
1H25 Group performance Return to profitability alongside continued balance growth JUN25 DEC24? Change JUN24” Change £m £m % £m % 2,459 = 2,308 7% 2,252 9% Receivables Gross customer interest earning balances! Average gross customer interest earning balances (excluding Personal Loans) Net receivables
Slide 13: 1H25 Group key performance metrics
1H25 Group key performance metrics Improving risk adjusted margin driving low single digits ROTE 7 7 a aed Change we Change + Asset yield decreased 60bps HOH, reflecting lower yield on 2CM. Credit Cards 3 5, yield reduced marginally, reflecting growth in 0% balance transfers (BTs) and elected key me
Slide 14: Net interest income and margin
18.9% 18.1% 17.4% 18.1% 0.3% (0.2%) 0.2% (1.0%) 17.4% 1% 207.3 200.6 202.2 2H24 Asset yield Funding Liquidity Product mix 1H25 1H24 2H24 1H25 23.2% Net Interest Income (£m) Net Interest Margin (%) 22.4% 21.8% 0% 4.9% 5.1% 4.9% • (1%) • 276.0 273.9 274.9 68.7 73.3 72.7 • 1H24 2H24 1H25 1H24 2H24 1H25
Slide 15: Gross customer interest earning balances
• 7% • 2,459 (49) 0 154 2,308 78 (32) 2% 49 371 15% 9% 217 • 733 Secured balances 30% £122m 33% 765 • 1,355 55% 1,278 55% DEC24 Credit Cards Vehicle Second Personal JUN25 Finance Charge Loans sale • Mortgages Cards Vehicle Finance Second charge mortgages Loans • 6% 2,252 2,252 2,308 2,313 2,459 JUN2
Slide 16: VF, Personal Loans and Cards
6% Gross Net 2,570 8% (2) (3) 2 7 2,570 111 4% 2,416 161 6% 2,325 200 2,362 73 3% 2,416 2,155 182 8% 230 9% 169 (49) 81 4% 7% 288 12% 2,010 4% 108 223 157 7% 9% 111 6% 249 11% 176 9% 2,459 96% VF Cards 1,825 2,011 2,180 1,724 1,917 2,083 96% (£5m) £9m 77% 83% 85% 86% 89% 90% 2,308 DEC24 Personal Int
Slide 17: Net charge-offs
• (18%) 92.3 • 76.1 • (30.7) 13.5 1.0 • Net charge-offs (£29.7m) • 2H24 Gross Recoveries IFRS9 modelled 1H25 charge-offs impairment /other • • • • •
Slide 18: Personal Loans sale and staging
(6%) (52) 262 (26) 90 5 245 36% 94 96 39% 26% 67 25% 61 38% 100 88 36% DEC24 Personal Originations Net risk Releases & JUN25 Loans sale movement Other Stage 1 Stage 2 Stage 3 • • •
Slide 19: Operating costs
219.2 22.4 (81.8) 0% 137.4 137.4 (7.9) 5.3 5.1 22.4 (6.3) 1.3 2.5 16.1 196.8 115.0 121.3 2H24 Notable 2H24 Transfor- Compla- Growth Inflation Discret- Other 1H25 items mation ints ionary savings staff costs Complaints (£m) Other operating costs (£m) 99.8% 79.3% 219 • 62.5% 22 180 25 137 • 16 197 155
Slide 20: Customer and CMC complaints
(65%) (58%) 24.9 (28%) 15.5 46,921 (31%) 17,455 16,938 22.4 40,640 13.1 16.1 11.7 10.9 29,363 28,055 4.5 (62)% 27,858 15,738 15,232 11,512 (59)% 7,193 5.4 7.3 6.8 8.0 +20% (60)% 3.4 (68)% 6,026 4.6 17,558 16,543 +29% 12,782 4.6 3.9 3.6 (10)% 1.9 (58)% 1,717 1,706 1,167 (32)% 1H24 2H24 1H25 DEC24 JUN
Slide 21: Product segmentation
Product segmentation A more transparent reporting of the Group’s continuing operations by product Vehicle acm Corporate 1H25 £m Cards Finance Centre Total Interest income”? 179.0 62.9 1.0 22.0 274.9 Interest expense (24.7) (14.3) (67) (27.0) (72.7) Net interest income 154.3 48.6 4.3 (5.0) 202.2 Non-
Slide 22: Weighted average APR (%)
39.8% 39.5% 39.9% 35.5% 38.2% 37.4% 0% 0% 1% 8% 8% 8% 36% 33% 30% 35% 44% 47% 17% 6% 7% 11% 4% 5% JUN24 DEC24 JUN25 >60% 50-59.9% 40-49.9% 30-39.9% <30% 0% products Weighted average APR (%) Weighted average APR excl. 0% products (%) • • • • •
Slide 23: Weighted average APR (%)
29.5% 28.4% 29.1% 2% 0% 0% 12% 14% 15% 35% 33% 50% 25% 30% 12% 28% 24% 21% JUN24 DEC24 JUN25 >50% 40-49.9% 30-39.9% 20-29.9% <20% Weighted average APR (%) • • • • •
Slide 24: Weighted average LTV (%)
70.1% 71.5% 13% 12% 67% 71% 20% 17% DEC24 JUN25 >=85% >55% <=55% Weighted average LTV (%) • • • • •
Slide 25: Corporate Centre
Corporate Centre Streamlined following reallocation of funding and operating costs to products 1H25 2H247 Change _1H24?_ Change £m £m % £m % Interest income? 22.0 23.8 (8% 22.5 (2)% Interest expense (27.0) (28.2) (4)% (25.8) 5% Net interest income (5.0) (4.4) 14% (3.3) 52% Non-interest income 1.3 2.
Slide 26: Cost of funds
5.8 5.59% 5.52% 5.6 5.36% 5.32% 5.4 5.25% 5.2 5.10% 5.25% 4.93% 5.0 4.75% 4.8 4.41% 4.6 4.92% 4.4 4.25% 4.2 4.0 3.8 3.6 0.0 FEB24 JUL24 DEC24 FEB25 MAR24 MAY24 AUG24 MAY25 OCT24 MAR25 NOV24 DEC23 JAN25 JAN24 APR24 JUN24 SEPT24 APR25 JUN25 BoE base rate Cost of funds (excl. Tier 2) 2-yr swap rate Cos
Slide 27: Statutory profit after tax impacting capital
0.4 (1.1) 0.6 18.8 18.5 (0.4) 0.2 5.4 5.1 13.4 13.4 DEC24 Statutory profit after Personal Loans Credit Risk RWA Increase Intangible spend Other JUN25 tax impacting capital sale Tier 1 surplus Tier 1 requirement • • • • • • •
Slide 28: Guidance summary
Guidance summary Remain on track to achieve FY25 and FY26 guidance, with higher balance growth in 2025 1H25 Performance Statutory Guidance Statutory FY25 FY26 >£2.6bn Gross customer interest earning balances? £2,459m (up from ¢£2.6bn) c.£3.0bn Net Interest Margin? 17.4% >17% >16% Cost: Income ratio*
Slide 29: Focused on creating long-term shareholder value
Focused on creating long-term shareholder value Delivering for our customers to drive ongoing sustainable, profitable growth 1 2. Profitable in 1H25 driven by balance growth and improved risk adjusted margin. Sufficient capital to achieve growth plans. . Credit quality remains robust, reflecting con
Slide 30: Vanquis purpose
Vanquis purpose Delivering caring banking so our customers can make the most of life’s opportunities a a . . * . A very quick and easy process From application to funds being paid “ I was recommended Snoop by a from start to finish, customer to the dealer, I had a seamless & friend, and I am so glad
Slide 31: Q&A
QM vandquis Q&A
Slide 32: Appendix
QM vandquis Appendix
Slide 33: Product contribution
Product contribution Cards Vehicle Finance 2CM Corporate Centre Total Asset driven products 1H25 2H247 1H25 0 2H247—1H24" 1H25 2H247 1H25 0 -2H247_—1H247 1H25 2H247_—1H24? £m £m £m £m £m £m £m £m £m £m £m £m £m Interest income” 179.0 182.1 62.9 63.4 69.7} 11.0 46 22.0 23.8 22.5 2749 273.9 276.0 Inte
Slide 34: Receivables Reconciliation
Receivables Reconciliation Vehicle Finance 2cM sccontin gna erations) Total Asset driven products i discontinued operations); JUN25 DEC24 JUN2 JUN25 DEC24 JUN24; JUN25 DEC24 JUN24} JUN25 DEC24 JUN24 £m £m fi £m £m £m} £m £m £m} £m £m £m cross customer interest earning 733765 371,217, 30 - 49 -77E- 2
Slide 35: ROTE, EPS, TNAV Calculation
ROTE, EPS, TNAV Calculation 1H25 2H24 1H241 ROTE & EPS Gal —m €m Profit before tax 7A (89.8) (46.5) Tax charge / (credit) (1.5) 6.3 10.7 Profit after tax (A) 5.6 (83.5) (35.8) Ave. equity as per balance sheet 442.9 509.3 549.8 Ave. pension asset (25.7) (33.5) (34.0) Ave. deferred tax on pension asse
Slide 36: Summary Balance Sheet
Summary Balance Sheet JUN25 DEC24 JUN24 £m £m £m Assets Cash and balances at central banks 805 1,004 773 Amounts receivables from customers®> 2,325 2,154 2,009 Pension asset 13 28 34 Intangibles 63 62 60 Goodwill 1 1 72 Derivative financial assets 2 - 1 Other assets 238 126 136 Total assets 3,447 3,
Slide 37: Capital Composition
Capital Composition JUN25 DEC24 JUN24 £m £m £m Total equity 435 441 530 Retirement benefit asset (13) (28) (34) Deferred tax on retirement benefit asset 3 7 9 Goodwill @ 0) (72) Intangible assets (63) (62) (60) Deferred tax on intangible assets 4 5 3 Deferred tax asset from losses (8) (18) (15) CET1
Slide 38: Glossary
Glossary Al Artificial Intelligence ISA Individual Savings Account APR Annual Percentage Rate KPL Key Performance Indicator att Additional Tier 1 LaB Liquid Asset Buffer AVE/Ave. Average LR Liquidity Coverage Ratio BoE Bank of England Lv Loan To Value BT Balance Transfer NIM Net Interest Margin SREP
Slide 39: Footnotes
Footnotes Gross customer interest earning balances excludes post charge off assets and deferred acquisition costs, which are included in gross receivables. Risk-weighted assets are calculated by assigning a degree of risk expressed as a percentage (risk weight) to the on and off-balance sheet assets
Slide 40: Footnotes
Footnotes 30 Excludes accrued interest, arrangement fees, overdrafts and fair value adjustments for hedged risk. 31 Cost of funds is calculated as interest expense as a percentage of weighted average volume of funding drawn (excl. fees, IFRS16 and swaps), on an annualised basis. 32 2-year swap is ta
Slide 41: Disclaimers
Disclaimers Important notice The information in this presentation may include forward-looking statements. Forward looking statements, by their nature involve risk and uncertainty as they relate to future events and circumstances. Forward looking statements can be identified from the fact that they d
Slide 42: Investor Relations contact
QM vandquis Investor Relations contact James Cranstoun Phone: +44 7766 937 406 Email: james.cranstoun@vanquis.com Website: www.vanquis.com
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