Vanquis Banking Group Plc · LSE:VANQ
Vanquis Banking — 1H26 Earnings Presentation
53 slides from Vanquis Banking's earnings presentation, Jul 30, 2026
Slide 1: 2026 Half Year Results
1 2026 HALF YEAR RESULTS 30 JULY 2026 8:30AM
Slide 2: Agenda
Agenda 1H26 Performance Summary and Ian McLaughlin Outlook 1H26 Performance and Guidance Dave Watts Detail Conclusion Ian McLaughlin Q&A Ian & Dave 2
Slide 3: 1H26 Performance Summary and Outlook
1H26 Performance Summary and Outlook Ian McLaughlin Chief Executive Officer
Slide 4: Profitable growth continued in 1H26
Profitable growth continued in 1H26 HoH % YoY % 1. Profit before tax up 44% YoY at £8.9m, above FY25 1H26 Change Change profit. Gross customer interest- £3,054m 8% 24% earning balances1 2. 24% balance growth YoY, with 8% income growth. Net interest margin 15.0% (1.2)% (2.4)% (NIM)2 3. NIM and RAM re
Slide 5: Continued operational delivery against our three priorities
Continued operational delivery against our three priorities Building strong foundations to deliver attractive shareholder returns in the medium term Serve More Serve Responsibly Scale Profitably • Grew Credit Card customers and • UK Customer Satisfaction Index Successfully migrated drove engagement
Slide 6: Impacts from increased macroeconomic uncertainty emerging in 2Q26
Impacts from increased macroeconomic uncertainty emerging in 2Q26 Two main headwinds: 1.1 Lower utilisation from existing Credit Card customers than previously planned for 2. 2 Increased IFRS9 macroeconomic impairment provision for higher unemployment forecast Gross customer interest earning balance
Slide 7: Improving Credit Card profitability from recent new customer growth
Improving Credit Card profitability from recent new customer growth New customer growth since 2025 will deliver greater contribution to profits from 2027 Cumulative PBT of a typical customer (£) • Profitability will increase in 2027 Credit Builder card Balance Transfer (BT) card • Balances reduced b
Slide 8: Vehicle Finance growth to resume from 2027
Vehicle Finance growth to resume from 2027 Improved profitability from 2027 post launch of the new onboarding and servicing platform, with new customers becoming profitable within the first year Cumulative PBT of a typical customer (£) New customers become profitable towards the end of year 1, with
Slide 9: Strong 2CM growth continues, though competitor activity increasing
Strong 2CM growth continues, though competitor activity increasing Growth via forward flow partners to continue at a similar rate, driving increased profitability despite competitive pressures, with new customers profitable from month one Cumulative PBT of a typical customer (£) New customers become
Slide 10: Updated financial guidance for 2026 and 2027
Updated financial guidance for 2026 and 2027 Guidance assumes impact on consumer confidence from uncertain macroeconomic environment continues; balance growth expected to be driven by increased new customer acquisition; combination moderates short term returns 1H26 FY26 FY27 Actuals Guidance Guidanc
Slide 11: Continuing to build a higher quality, more profitable business
Continuing to build a higher quality, more profitable business The growth opportunity within the underserved addressable market underpins our confidence in the strategy Confidence in the outlook supported by: 1. Gateway technology transformation build remains on track for completion in 2026. 2. Grea
Slide 12: 1H26 Financial Performance and Guidance Detail
1H26 Financial Performance and Guidance Detail Dave Watts Chief Financial Officer
Slide 13: 1H26 Group performance
1H26 Group performance Profitable balance growth continued; mix of growth impacted asset yield, NIM and RAM JUN26 JUN25 Change Income Statement £m £m % Gross Customer Customer Net Interest Net interest income 218.1 202.2 8% Interest Earning Deposits31 Margin2 Non-interest income 11% 19.4 17.5 Balanc
Slide 14: Gross customer interest-earning balances
Gross customer interest-earning balances Strong new customer balance growth in Credit Cards and 2CM Gross customer interest-earning balances trend (£m)1 • Group balances increased 24% YoY and 8% HoH 24% • Credit Cards • Balances increased 2% HoH to £1,547m, driven by • New customer balance growth, i
Slide 15: Net Interest Margin
Net Interest Margin Reduction reflects the mix of balance growth – 2CM and new Credit Card customers Net interest income trend (£m) Product mix 19.5% 19.4% 18.9% Product mix (average gross customer Asset yield10 interest-earning balances9) 17.4% 16.2% JUN26 JUN25 15.0% JUN26 JUN25 JUN26 JUN25 share
Slide 16: Impairment charges
Impairment charges Stable portfolio credit quality, with an increased IFRS9 provision for macroeconomic uncertainty Impairment charges (£m) Impairment trend (£m) 1H26 1H25 Change 7.9% £m £m % 7.0% Gross charge-offs (137.3) (122.1) 12% 6.6% Recoveries 30.6 28.6 7% (2%) Net charge-offs (106.7) (93.5)
Slide 17: Operating costs
Operating costs Cost discipline maintained, with additional Gateway spend to drive increased future savings Operating costs trend (£) Costs by type (£m) & Full-time equivalent headcount (FTE) (#) 62.5% 54.5% 53.1% 1H26 1H25 Change 137.4 £m £m % Cost by type (£m) 128.1 16.1 126.2 Staff and outsourced
Slide 18: Product contribution
Product contribution Improved profitability across all lending products in 1H26 Cards Vehicle Finance 2CM Corporate Centre Total 1H26 1H25 Change 1H26 1H25 Change 1H26 1H25 Change 1H26 1H25 Change 1H26 1H25 Change £m £m % £m £m % £m £m % £m £m % £m £m % Interest income 194.1 179.0 8% 61.3 62.9 (3)%
Slide 19: Credit Cards
Credit Cards Continued profitable growth; margins impacted by the macroeconomic environment Portfolio mix (APR %) 39.9% 39.6% Gross Customer Asset Net Interest 39.3% Interest Earning Yield10 Margin2 Balances1 £1,547m 25.5% 22.0% 35.5% 33.7% 32.8% (DEC25: £1,518m) 2% (1H25: 27.8%) (2.3)% (1H25: 24.0%
Slide 20: Vehicle Finance (VF)
Vehicle Finance (VF) Continued to proactively manage new business growth, while improving product profitability, in advance of the new onboarding and servicing platform being built as part of Gateway Gross Customer Asset Net Interest Interest Earning Yield10 Margin2 29.3% Balances1 29.1% 29.1% £707m
Slide 21: Second Charge Mortgages (2CM)
Second Charge Mortgages (2CM) Continued strong growth in a growing market Loan to value (LTV) (%) 71.5% 71.1% 70.6% Gross Customer Asset Net Interest Interest Earning Yield10 Margin2 12% 12% 13% Balances1 £800m 6.8% 2.5% 71% 71% 69% (DEC25: £599m) 34% (1H25: 7.6%) (0.8)% (1H25: 3.0%) (0.5)% Cost of
Slide 22: Liquidity & Funding optimisation
Liquidity & Funding optimisation Successful Credit Card ABS issuance while broadening our deposits product range Liquidity JUN26 DEC25 Average deposit pricing21 vs benchmark interest rates (%) 22 Expected Change £m £m 4.75% to High Quality Liquid Assets (HQLA)17 1,215 998 22% 4.8 increase of which C
Slide 23: CET1 capital
CET1 capital Deployed 80bps of CET1 capital for lending growth, with continued capital strength to deliver our plans CET1 ratio (%)6 16.5 0.2 (0.8) 5.2 (0.3) 15.6 4.3 11.3 11.3 FY25 Statutory profit attributable RWA increase Other incl. intangible spend 1H26 to shareholders CET1 ratio surplus* CET1
Slide 24: Further capital optimisation
Further capital optimisation Additional capital stack optimisation following existing Tier 2 tender and new issuance in 2Q26 Total capital ratio (%)23 Capital ratio requirements and surplus capital to target (%) 24.7 24.7 24.7 (1.9) 4.9 22.8 (4.7) 4.7 8.1 8.1 18.2 6.2 3.0 1.5 15.6 2.3 2.3 1.1 14.5 1
Slide 25: Basel 3.1 and SDDT regime capital requirements from 1JAN27
Basel 3.1 and SDDT regime capital requirements from 1JAN27 The Group expects to have additional surplus capital to support balance growth Increase in proforma RWAs from Basel 3.1 (£m/%) CET1 ratio requirements* and surplus CET1 capital to guidance (%) 15% 15.6 1.1 2,510 >14.5% 13.5 3.2 1.5 2,181 311
Slide 26: Balances, margins and cost: income guidance
Balances, margins and cost: income guidance Balance growth guidance remains unchanged; as expected, mix of growth in 2CM and Credit Cards driving lower margins. NIM should stabilise post 2027, as Credit Card growth matures Gross customer interest earning balances (£m)1 NIM trend (%)2 c.15.5% c.14.5%
Slide 27: Statutory ROTE guidance (illustrative walk)
Statutory ROTE guidance (illustrative walk) ROTE impacted by reduced income from lower than expected Credit Card utilisation by existing customers and increased IFRS9 macroeconomic impairment provision Statutory ROTE outlook FY25-27 (%)5 Increased income reflects Lower income due to seasoning of rec
Slide 28: Conclusion
QM vandquis Conclusion Tan McLaughlin
Slide 29: Progress continues despite macroeconomic headwinds
Progress continues despite macroeconomic headwinds Driving the right actions to grow and deliver long term, sustainable profitability 1. Improved PBT to £8.9m, a higher PBT than FY25, despite an £8.5m increase in the IFRS9 macroeconomic provision. 2. Grew balances by 8% in 1H26, despite existing Cre
Slide 30: Q&A
QM vandquis Q&A
Slide 31: Strategy remains focused on creating long term shareholder value
Strategy remains focused on creating long term shareholder value The opportunity to “Serve More”, “Serve Responsibly” and “Scale Profitably” in the underserved UK market remains significant What sets us apart A large and underserved target addressable market • Over half of UK adults face barriers to
Slide 32: Appendix
QM vandquis Appendix
Slide 33: Serve More
Serve More Reaching more customers and deepening relationships across the underserved UK adult population What we have delivered Key metrics • Strengthened the Credit Card proposition through the new Vanquis app, with Customer numbers more than 250,000 Vanquis Rewards registrations and over 700,000
Slide 34: Serve Responsibly
Serve Responsibly Ensuring our lending is affordable for customers, supporting financial inclusion and helping customers build financial resilience What we have delivered Key metrics • The Group’s UK Customer Satisfaction Index (CSI) score has increased to 83.2, Cost of risk11 relative to an industr
Slide 35: Scale Profitably
Scale Profitably Building a simpler, more efficient and more scalable bank What we have delivered Key metrics • Established the new Vanquis app as the Group’s primary digital customer Technology and Operations cash channel, migrating all Credit Card customers and bringing together servicing, investm
Slide 36: Remain on track to complete the Gateway programme build in 2026
Remain on track to complete the Gateway programme build in 2026 Technology transformation on track, with focus on further automation and expanded use of AI What we will deliver 2H26 • Upon completion we will have built a modern, efficient and New onboarding & servicing platform built for Vehicle Fin
Slide 37: Customer profiles
Customer profiles Customers tend to be midlife, employed with a modest income & well distributed across the UK Average customer age Geographic distribution of customer base* Credit Card Vehicle Finance 2CM Savings Snoop 48 43 46 54 37 Residential status** Owner Occupier Average income 26% 8% Renting
Slide 38: Our 2CM business
Our 2CM business Forward flow partners maintain the customer relationship, but Vanquis acquires the interest in the loan Long term forward flow arrangements Conducted in line with Lending Includes arrears Utilise up to 70 Policy reviewed & approved by handling, Vanquis takes on mortgage brokers Vanq
Slide 39: Update on motor finance customer redress
Update on motor finance customer redress Limited liability on motor finance commissions • Vanquis did not participate in discretionary commission arrangements (DCAs) and did not operate tied selling arrangements. Therefore, the Group is not in scope for these elements of the FCA motor finance compen
Slide 40: 1H26 Group performance
1H26 Group performance 1H26 1H25 Change 1H26 1H25 Income Statement Selected key metrics Change £m £m % % % Net interest income 218.1 202.2 8% Average gross customer interest-earning balances 2,933 2,339 25% Non-interest income 19.4 17.5 11% (excluding Personal Loans)9 (£m) Total income 237.5 219.7 8
Slide 41: Segmental performance (1/2)
Segmental performance (1/2) 1H26 1H25 Change 1H26 1H25 Change Credit Cards Vehicle Finance £m £m % £m £m % Interest income 194.1 179.0 8% Interest income 61.3 62.9 (3)% Interest expense (27.1) (24.7) 10% Interest expense (13.1) (14.3) (8)% Net interest income 167.0 154.3 8% Net interest income 48.2
Slide 42: Segmental performance (2/2)
Segmental performance (2/2) 1H26 1H25 Change 1H26 1H25 Change Second Charge Mortgages Corporate Centre £m £m % £m £m % Interest income 23.1 11.0 110% Interest income 19.0 22.0 (14)% Interest expense (14.6) (6.7) 118% Interest expense (24.6) (27.0) (9)% Net interest income 8.5 4.3 98% Net interest in
Slide 43: New customer product financial performance
New customer product financial performance All new lending written delivers through the cycle ROTE of > mid-teens Credit Cards – Credit Builder Credit Cards – Balance Transfer Vehicle Finance Second Charge Mortgages 1,000 3,500 12,000 70,000 3,000 10,000 60,000 800 2,500 50,000 600 8,000 2,000 40,00
Slide 44: Receivables Reconciliation
Receivables Reconciliation Cards Vehicle Finance 2CM Total Asset driven products JUN26 DEC25 JUN26 DEC25 JUN26 DEC25 JUN26 DEC25 £m £m £m £m £m £m £m £m Gross customer interest-earning balances1 1,547 1,518 707 706 800 599 3,054 2,824 Adjustments: Post charge off assets 6 6 13 10 - - 19 16 Deferred
Slide 45: Gross and net receivables
Gross and net receivables Receivables by stage (£m) Gross receivables and coverage ratios by stage Gross receivables Coverage ratio29 Gross 3,176 JUN26 DEC25 Share JUN26 DEC25 Change 151 5% £m £m % % % 2,935 Total 3,176 2,935 7.6 8.4 (0.8) 140 5% 266 Stage 1 2,759 2,520 87% 3.5 4.1 (0.6) 8% Stage 2
Slide 46: ROTE, EPS, TNAV Calculation
ROTE, EPS, TNAV Calculation 1H26 1H25 ROTE & EPS £m £m • Balance sheet item averages are based on average month end balances Statutory profit/(loss) attributable to shareholders for the 6 months ending 30 June or 31 December, using a 7-point average. 4.4 5.6 (A) Ave. equity as per balance sheet 490
Slide 47: Summary Balance Sheet
Summary Balance Sheet JUN26 DEC25 JUN26 DEC25 Funding Mix20 % % £m £m £m £m Assets Fixed-term savings 1,386 36.8% 1,505 45.2% Cash and cash equivalents 859 805 Fixed Individual Savings Accounts (ISAs) 805 21.3% 503 15.1% Investment securities 404 255 Retail notice accounts 304 8.1% 437 13.1% Amounts
Slide 48: Capital Composition
Capital Composition JUN26 DEC25 Risk weighted assets by product (£m) £m £m Total equity 495 487 JUN26 DEC25 (10) (6) £m £m Pension asset Credit Cards 1,144 1,122 Deferred tax on retirement benefit asset 3 2 Vehicle Finance 580 573 Goodwill (1) (1) Second Charge Mortgages 340 260 Intangible assets (7
Slide 49: Glossary
Glossary ABS Asset Backed Securities LCR Liquidity Coverage Ratio AI Artificial Intelligence LTV Loan To Value APR Annual Percentage Rate NIM Net Interest Margin AT1 Additional Tier 1 N/M Not Meaningful AVE / Ave. Average P&L Profit & Loss Account BoE Bank of England PAT Profit After Tax BT Balance
Slide 50: Footnotes
Footnotes Gross customer interest-earning balances excludes post charge off assets and deferred acquisition costs, which 17 Liquid assets (HQLA) are unencumbered assets, that are liquid in markets during a time of stress. 1 are included in gross receivables. The liquidity coverage ratio (LCR) refers
Slide 51: 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 52: Investor Relations contact
Investor Relations contact James Cranstoun Phone: +44 7766 937 406 Email: james.cranstoun@vanquis.com Website: www.vanquis.com
Slide 53: Vanquis
VY vandquis The bank that’s got your back