Interim Results for six months ended 30 June 2025

About this update from Vanquis Banking Group Plc

[{"type":"text","content":"\n \n \n   \n Vanquis Banking Group interim results for the six months ended 30 June 2025 \n Profitable and growing \n   \n London - 7 August 2025 - Vanquis Banking Group plc ('the Group' or 'Vanquis') today published its interim results for the six months to 30 June 2025. \n   \n Ian McLaughlin, Chief Executive Officer, commented: \"The turnaround of Vanquis remains firmly on track and is gaining momentum.  The Group delivered two consecutive quarters of profitability in the first half and has grown gross customer interest-earning balances over the last three quarters. \n   \n Credit quality remains robust, with customers continuing to demonstrate financial resilience. Risk-adjusted income improved, supported by a lower cost of risk. \n   \n Operating costs remained well controlled, with all necessary actions taken to deliver the additional £15 million in transformation savings committed by year-end 2025. Our technology transformation programme, Gateway, is progressing as planned-enhancing efficiency, scalability, and unlocking long-term cost benefits. \n   \n Complaint costs were meaningfully lower year-on-year, partly reflecting the revised Financial Ombudsman Service (FOS) fee structure implemented on 1 April 2025.  Since then, negligible Vanquis-related Claims Management Company (CMC) complaints have been referred to the FOS.  \n   \n The recent Supreme Court judgment provides much-needed clarity, and we acknowledge the FCA's decision to consult on a motor finance compensation scheme. Vanquis did not participate in discretionary commission arrangements. Our position is clearly differentiated from the unfair relationship decision in the Johnson case, supported by stronger disclosures, much lower average commissions and clear customer consent. \n   \n Vanquis plays an important role in UK banking, and I am pleased with the momentum we are building. We remain focused on supporting our customers while delivering sustainable and profitable growth for all stakeholders.\" \n   \n Executive Summary \n   \n The Group returned to profit in 1H25, while delivering balance growth to drive long-term sustainable profitability. Management remains focused on operational efficiency and deploying capital in the most accretive opportunities to generate higher returns. \n   \n ·    Profitability: The Group was profitable in both quarters of 1H25, delivering a statutory profit before tax from continuing operations of £6.2m (1H24: loss of £46.1m) and was capital accretive with a statutory return on tangible equity (ROTE) of 3.1% (1H24: (18.9)%), in line with the guidance of low single digit ROTE for 2025. \n ·    Balance growth: Gross customer interest-earning balances grew 7% in 1H25 to £2,459m and the Group now expects to achieve greater than £2.6bn of balances by the end of 2025 (c.£2.6bn previously). \n ·    Increased risk adjusted income: Improved credit quality drove a reduction in cost of risk to 6.6% (1H24: 8.5%), resulting in a 7% increase in risk adjusted income to £143.6m. \n ·    Cost discipline: Further transformation cost savings, lower complaint costs and the non-repeat of notable items improved the statutory cost: income ratio to 62.5% (1H24: 79.3%), and the Group remains on track to achieve a high 50s percent cost: income ratio for FY25. \n ·    Complaints: Complaint costs reduced 36% year-on-year to £16.1m, with FOS fees reducing £8.6m to £4.5m. 1Q25 complaint costs were in line with expectations, with a lower run rate from 2Q25, as expected following the implementation of the revised FOS fee structure. The Group expects 2H25 complaint costs to be lower than 1H25. \n ·    Vehicle Finance commission disclosures: Vanquis did not participate in discretionary commission arrangements (DCAs), so the Group would not be in scope for this element of any Financial Conduct Authority (FCA) motor finance compensation scheme.  Whilst the FCA intends to consult on the inclusion of certain non-discretionary commission arrangements following the unfair relationship Supreme Court decision in the Johnson case, Vanquis believes its position is clearly differentiated on a number of grounds. These include, but are not limited to, the fact the Group provided significantly better commission disclosures than those in Johnson, with substantially lower average commissions relative to the charge for credit. Vehicle Finance customers also signed pre-contractual documentation confirming that a commission would be paid. As a result, and in accordance with IAS 37, the Group has not provided for this matter but has disclosed a contingent liability. \n ·    Robust liquidity, funding and capital: The Group remained highly liquid, with a Liquidity Coverage Ratio (LCR) of 366% (December 2024: 359%), was 84.6% (December 2024: 85.6%) retail funded, a core strength of the Group, and had a Tier 1 capital ratio of 18.5% (December 2024: 18.8%), with sufficient capital for future growth. \n   \n Group financial results \n   \n \n \n \n \n Income Statement (£m) \n \n \n \n \n \n 1H25 \n \n \n 2H24 \n (Re-presented 1 ) \n \n \n 1H24 \n (Re-presented 1 ) \n \n \n HoH \n Change % \n \n \n YoY \n Change % \n \n \n \n \n Interest income \n \n \n \n \n \n 274.9 \n \n \n 273.9 \n \n \n 276.0 \n \n \n - \n \n \n - \n \n \n \n \n Interest expense \n \n \n \n \n \n (72.7) \n \n \n (73.3) \n \n \n (68.7) \n \n \n (1) \n \n \n 6 \n \n \n \n \n Net interest income \n \n \n   \n \n \n 202.2 \n \n \n 200.6 \n \n \n 207.3 \n \n \n 1 \n \n \n (2) \n \n \n \n \n Non-interest income \n \n \n \n \n \n 17.5 \n \n \n 19.0 \n \n \n 19.5 \n \n \n (8) \n \n \n (10) \n \n \n \n \n Total income \n \n \n \n \n \n 219.7 \n \n \n 219.6 \n \n \n 226.8 \n \n \n - \n \n \n (3) \n \n \n \n \n Impairment charges \n \n \n \n \n \n (76.1) \n \n \n (92.3) \n \n \n (93.0) \n \n \n (18) \n \n \n (18) \n \n \n \n \n Risk-adjusted income \n \n \n \n \n \n 143.6 \n \n \n 127.3 \n \n \n 133.8 \n \n \n 13 \n \n \n 7 \n \n \n \n \n Operating costs \n \n \n \n \n \n (137.4) \n \n \n (219.2) \n \n \n (179.9) \n \n \n (37) \n \n \n (24) \n \n \n \n \n Profit/(loss) before tax from continuing operations \n \n \n \n \n \n 6.2 \n \n \n (91.9) \n \n \n (46.1) \n \n \n \n \n \n \n \n \n \n \n Tax (charge)/credit \n \n \n \n \n \n (1.3) \n \n \n 6.8 \n \n \n 10.6 \n \n \n \n \n \n \n \n \n \n \n Profit/(loss) after tax from continuing operations \n \n \n \n \n \n 4.9 \n \n \n (85.1) \n \n \n (35.5) \n \n \n \n \n \n \n \n \n \n \n Profit/(loss) after tax from discontinued operations \n \n \n \n \n \n 0.7 \n \n \n 1.6 \n \n \n (0.3) \n \n \n \n \n \n \n \n \n \n \n Statutory profit/(loss) after tax \n \n \n \n \n \n 5.6 \n \n \n (83.5) \n \n \n (35.8) \n \n \n \n \n \n \n \n \n \n \n Balance Sheet (£m) \n \n \n \n \n \n Jun-25 \n \n \n Dec-24 \n \n \n Jun-24 \n \n \n HoH \n Change % \n \n \n YoY \n Change % \n \n \n \n \n Gross customer interest-earning balances \n \n \n \n \n \n 2,459 \n \n \n 2,308 \n \n \n 2,252 \n \n \n 7 \n \n \n 9 \n \n \n \n \n Average gross customer interest-earning balances (excluding Personal Loans) \n \n \n \n \n \n 2,339 \n \n \n 2,208 \n \n \n 2,201 \n \n \n 6 \n \n \n 6 \n \n \n \n \n Gross receivables \n \n \n \n \n \n 2,570 \n \n \n 2,416 \n \n \n 2,361 \n \n \n 6 \n \n \n 9 \n \n \n \n \n Net receivables \n \n \n \n \n \n 2,325 \n \n \n 2,155 \n \n \n 2,010 \n \n \n 8 \n \n \n 16 \n \n \n \n \n Closing tangible net asset value (TNAV) 10 \n \n \n \n \n \n 362 \n \n \n 358 \n \n \n 371 \n \n \n 1 \n \n \n (3) \n \n \n \n \n Average tangible equity 8 \n \n \n \n \n \n 361 \n \n \n 362 \n \n \n 382 \n \n \n (-) \n \n \n (5) \n \n \n \n \n \n \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Selected key metrics (%) \n \n \n \n \n \n 1H25 \n \n \n 2H24 \n (Re-presented 1 ) \n \n \n 1H24 \n (Re-presented 1 ) \n \n \n HoH \n Change \n \n \n YoY \n Change \n \n \n \n \n Asset yield 2 \n \n \n \n \n \n 21.8 \n \n \n 22.4 \n \n \n 23.2 \n \n \n (0.6) \n \n \n (1.4) \n \n \n \n \n Net interest margin (NIM) 3 \n \n \n \n \n \n 17.4 \n \n \n 18.1 \n \n \n 18.9 \n \n \n (0.7) \n \n \n (1.5) \n \n \n \n \n Total income margin (TIM) 4 \n \n \n \n \n \n 18.9 \n \n \n 19.8 \n \n \n 20.7 \n \n \n (0.9) \n \n \n (1.8) \n \n \n \n \n Cost of risk 5 \n \n \n \n \n \n (6.6) \n \n \n (8.3) \n \n \n (8.5) \n \n \n 1.7 \n \n \n 1.9 \n \n \n \n \n Risk-adjusted margin (RAM) 6 \n \n \n \n \n \n 12.4 \n \n \n 11.5 \n \n \n 12.2 \n \n \n 0.9 \n \n \n 0.2 \n \n \n \n \n Statutory cost: income ratio 7 \n \n \n \n \n \n 62.5 \n \n \n 99.8 \n \n \n 79.3 \n \n \n (37.3) \n \n \n (16.8) \n \n \n \n \n Statutory ROTE 8 \n \n \n \n \n \n 3.1 \n \n \n (45.9) \n \n \n (18.9) \n \n \n \n \n \n \n \n \n \n \n Selected per share metrics (p) \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n HoH Change % \n \n \n YoY \n Change % \n \n \n \n \n Basic earnings per share (EPS) 9 \n \n \n \n \n \n 2.2 \n \n \n (32.6) \n \n \n (14.1) \n \n \n \n \n \n \n \n \n \n \n Dividend per share \n \n \n \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n \n \n TNAV per share 10 \n \n \n \n \n \n 142 \n \n \n 140 \n \n \n 146 \n \n \n 1 \n \n \n (3) \n \n \n \n \n   \n   \n   \n   \n \n \n \n \n Notable items (£m) \n \n \n Account line \n \n \n Jun-25 \n \n \n Dec-24 \n \n \n Jun-24 \n \n \n \n \n Goodwill write-off \n \n \n Operating costs \n \n \n - \n \n \n (71.2) \n \n \n - \n \n \n \n \n Transformation and other exceptional costs \n \n \n Operating costs \n \n \n - \n \n \n (8.6) \n \n \n (15.5) \n \n \n \n \n Amortisation of acquisition intangibles \n \n \n Operating costs \n \n \n - \n \n \n (2.0) \n \n \n (4.2) \n \n \n \n \n Vehicle Finance receivables review \n \n \n Income \n \n \n - \n \n \n (1.4) \n \n \n (3.1) \n \n \n \n \n \n \n \n Impairment \n \n \n - \n \n \n (5.4) \n \n \n (9.7) \n \n \n \n \n Other one-off cost items \n \n \n Operating costs \n \n \n - \n \n \n - \n \n \n (10.2) \n \n \n \n \n Total notable items \n \n \n   \n \n \n - \n \n \n (88.6) \n \n \n (42.7) \n \n \n \n \n   \n   \n 1H25 Financial Highlights \n   \n Income Statement \n   \n All commentary relates to year-on-year performance unless otherwise stated. \n   \n Income \n ·      Net interest income decreased 2% to £202.2m and total income reduced 3% to £219.7m, driven largely by higher year-on-year cost of funds. \n o  Interest income was broadly flat at £274.9m, reflecting a 6% increase in average gross customer interest-earning balances to £2,339m offset by the mix effect of growing lower-risk and lower-margin Second Charge Mortgages. \n § Asset yield decreased 140bps to 21.8%, reflecting the lower yield on Second Charge Mortgages. Credit Cards yield reduced marginally, reflecting growth in 0% balance transfer (BT) and promotional products, while Vehicle Finance yield improved. \n o  Interest expense increased 6% year-on-year to £72.7m, but reduced 1% half-on-half, reflecting a peak in cost of funds in 2H24 when maturing fixed term deposits were refinanced at higher market rates.  \n o  The combination of these factors drove a reduction in NIM to 17.4% (1H24: 18.9%). \n o  Non-interest income reduced 10% to £17.5m reflecting lower fee and commission income. \n   \n Impairment \n ·      Impairment charges reduced 18% to £76.1m driven by the non-repeat of the £9.7m prior year impact of the Vehicle Finance receivables review. C redit risk in the underlying book improved, with reduced adverse stage migrations. \n o  Net charge-offs, calculated as gross charge-offs less recoveries, increased 4% to £93.5m. \n o  Impairment charges driven by originations increased 21% to £25.7m, reflecting growth in new gross customer interest-earning balances. \n o  Net risk movements from stage migrations and changes in post model adjustments (PMAs) resulted in a lower net increase in impairment of £51.9m (1H24: £82.4m). This was partially offset by lower releases from write-offs and debt sales, reducing impairment by £89.4m (1H24: £97.3m). \n o  Cost of risk reduced 190bps to 6.6%. \n ·      As a result, risk adjusted income improved 7% to £143.6m, driving a 20bps improvement in risk adjusted margin to 12.4%. \n   \n Operating costs \n ·      Operating costs decreased 24% to £137.4m.  \n o  This reflected the non-repeat of £29.9m of prior year cost notable items, including £15.5m of transformation and other exceptional costs and £10.2m of other one-off costs largely relating to the write-off of a legacy mobile app. \n o  The remaining £12.6m reduction reflected £8.9m lower complaint costs, and continued transformation savings of £7.9m, more than offsetting growth and inflation driven cost increases and accruals for discretionary staff costs. \n o  This delivered a statutory cost: income ratio of 62.5% (1H24: 79.3%). \n   \n Profits \n ·      Profit before tax from continuing operations was £6.2m (1H24: loss of £(46.1)m). \n ·      The tax charge of £1.3m (1H24: credit of £10.6m) broadly reflected the mainstream UK corporation tax rate of 25.0% on the profit before tax from continuing operations. \n ·      Profit after tax from continuing operations was £4.9m (1H24: loss of £(35.5)m). \n ·      Profit after tax from discontinued operations was £0.7m (1H24: loss of £(0.3)m), related to the Personal Loans portfolio, the sale of which completed at the end of 1Q25. \n ·      Statutory profit after tax was £5.6m (1H24: loss of £(35.8)m) and ROTE was 3.1% (1H24: (18.9)%). \n   \n   \n Balance Sheet \n   \n \n \n \n \n £m \n \n \n Jun-25 \n \n \n Dec-24 \n \n \n Jun-24 \n \n \n HoH \n Change % \n \n \n YoY \n Change % \n \n \n \n \n Assets \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Cash and balances at central banks \n \n \n 805 \n \n \n     1,004 \n \n \n         773 \n \n \n (20) \n \n \n 4 \n \n \n \n \n Amounts receivable from customers (net receivables) \n \n \n 2,325 \n \n \n      2,154 \n \n \n      2,009 \n \n \n 8 \n \n \n 16 \n \n \n \n \n Pension asset \n \n \n 13 \n \n \n            28 \n \n \n            34 \n \n \n (54) \n \n \n (62) \n \n \n \n \n Goodwill and other intangibles \n \n \n 64 \n \n \n            63 \n \n \n         133 \n \n \n 2 \n \n \n (52) \n \n \n \n \n Other assets \n \n \n 240 \n \n \n 126 \n \n \n 136 \n \n \n 90 \n \n \n 76 \n \n \n \n \n Total assets \n \n \n 3,447 \n \n \n     3,375 \n \n \n      3,085 \n \n \n 2 \n \n \n 12 \n \n \n \n \n Liabilities \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Retail deposits \n \n \n 2,464 \n \n \n      2,428 \n \n \n      1,938 \n \n \n 1 \n \n \n 27 \n \n \n \n \n Bank and other borrowings \n \n \n 448 \n \n \n          410 \n \n \n         504 \n \n \n 9 \n \n \n (11) \n \n \n \n \n Trade and other payables \n \n \n 56 \n \n \n            46 \n \n \n            50 \n \n \n 22 \n \n \n 12 \n \n \n \n \n Other liabilities \n \n \n 44 \n \n \n                50 \n \n \n                63 \n \n \n (12) \n \n \n (30) \n \n \n \n \n Total liabilities \n \n \n 3,012 \n \n \n      2,934 \n \n \n      2,555 \n \n \n 3 \n \n \n 18 \n \n \n \n \n   \n All commentary is relative to the December 2024 balance sheet, unless otherwise stated. \n   \n ·      Gross customer interest - earning balances increased 7% to £2,459m: \n o  Credit Card balances increased 6% to £1,355m, all in 2Q25 following stable balances in 1Q25, reflecting both credit line increases of existing customers, and new customer growth following the release of new product variants. \n o  Vehicle Finance balances declined 4% to £733m, in line with expectations, ahead of the launch of our new onboarding and servicing platform in mid-2026 as part of the Gateway technology transformation.   \n o  Second Charge M ortgage balances grew to £371m (December 2024: £217m) driven by long-term forward flow origination agreements with partners.   \n o  Personal Loan balances reduced to nil (December 2024: £49m) following the sale of the portfolio at the end of 1Q25. \n ·      Net receivables increased 8% to £2,325m, driven by growth in interest-earning balances and a 5% reduction in expected credit losses (ECL) to £245m, reflecting a clearer understanding of the credit risk of the portfolios. \n ·      Total assets increased 2% to £3,447m, driven by the 8% increase in net receivables. \n ·      Cash and balances at central banks reduced 20% to £805m, driven largely due to increased purchases of UK Government securities, as part of our strategy to diversify the Liquid Asset Buffer beyond Bank of England (BoE) deposits.  This drove the 90% increase in other assets, which rose to £239m. Most of the remaining cash continued to represent high quality liquid assets (HQLA) placed with the BoE. \n ·      The pension asset reduced to £13m (December 2024: £28m), reflecting the preliminarily results from the most recent Scheme valuation and updated market assumptions.  \n ·      Liabilities increased 3% to £3,012m, as retail deposits, inclusive of accrued interest, increased 1% to £2,464m, driven by continued optimisation of retail funding through a broader product range, including Individual Savings Accounts (ISAs), and distribution reach through the Snoop brand. \n ·      Bank and other borrowings increased 9% to £447m driven by increased utilisation of the Indexed Long-Term Repo (ILTR) facility as part of the Sterling Monetary Framework. \n   \n Capital, Liquidity and Funding \n   \n \n \n \n \n \n \n \n \n \n \n Jun-25 \n \n \n Dec-24 \n \n \n Jun-24 \n \n \n HoH \n Change \n \n \n YoY \n Change \n \n \n \n \n Tier 1 ratio (%) 11 \n \n \n \n \n \n 18.5 \n \n \n 18.8 \n \n \n 19.8 \n \n \n (0.3) \n \n \n (1.3) \n \n \n \n \n Risk weighted assets (RWAs) (£m) \n \n \n \n \n \n 1,883 \n \n \n 1,835 \n \n \n 1,813 \n \n \n 3% \n \n \n 4% \n \n \n \n \n High quality liquid assets (HQLA) (£m) \n \n \n \n \n \n 873 \n \n \n 947 \n \n \n 717 \n \n \n (8)% \n \n \n 22% \n \n \n \n \n Liquidity coverage ratio (LCR) (%) \n \n \n \n \n \n 366 \n \n \n 359 \n \n \n 557 \n \n \n (7) \n \n \n (191) \n \n \n \n \n Retail deposits (£m) \n \n \n \n \n \n 2,424 \n \n \n 2,399 \n \n \n 1,912 \n \n \n 1% \n \n \n 27% \n \n \n \n \n Retail funding (% of all funding) 12 \n \n \n \n \n \n 84.6 \n \n \n 85.6 \n \n \n 79.3 \n \n \n (1.0) \n \n \n 5.3 \n \n \n \n \n   \n All commentary is relative to the December 2024 capital liquidity and funding positions, unless otherwise stated. \n   \n Capital \n ·    Tier 1 capital ratio reduced 30bps to 18.5%. Capital accretion from the statutory profit after tax and a 40bps improvement from the Personal Loans portfolio sale was more than offset by growth driving a 3% increase in RWAs to £1,883m. \n o  This represented a surplus of £96m of Tier 1 capital above the Group's disclosed Tier 1 capital requirement and regulatory combined buffers of 13.4%. \n o  Tier 1 capital increased to £348m (December 2024: £344m).  \n o  The reduction in the ratio included the deployment of £104m of Credit Risk RWAs, including in Credit Cards and lower RWA density Second Charge Mortgages, in addition to intangible spend of £7m.  This capital investment reduced the ratio by 150bps. \n ·    The Group's leverage ratio of 12.5% (December 2024: 13.9%) remains comfortably above the minimum requirement. \n   \n Liquidity \n ·    The liquidity buffer of £873m (December 2024: £947m) included c.£115m invested in UK gilts, with the remainder held in the BoE reserve account.  This resulted in excess liquidity over the LCR 100% minimum of £619m (December 2024: £667m), reflecting an LCR of 366% (December 2024: 359%). \n   \n Funding \n ·    Retail deposits increased 1% to £2,424m, delivering funding at an attractive cost of funds compared to wholesale alternatives.  Within the retail deposit base, fixed-term products reduced 9% to £1,285m, retail notice accounts reduced 10% to £544m and easy access accounts reduced 12% to £329m.  These reductions were replaced by £265m of Individual Savings Accounts (ISAs) (December 2024: £6m), as the Group broadened its product range to optimize the cost of funds. \n ·    The Group remains primarily funded by retail deposits, at 84.6% (December 2024: 85.6%) of total funding including Tier 2 capital. \n ·    Ongoing funding diversification is provided by Tier 2 capital, modest levels of private securitisation secured by Vehicle Finance assets, and access to Central Bank facilities collateralised using Credit Card assets. \n ·    The Group's cost of funds reduced to 5.3% (December 2024: 5.5%), reflecting the reduced rate outlook and maturing fixed-term deposits being refinanced with lower interest rate savings products. \n   \n Outlook and Guidance \n   \n The Group's financial guidance for 2025 and 2026 remains unchanged, except for gross customer interest-earning balances in 2025. The Group now expects to achieve greater than £2.6bn of balances by the end of 2025 (c.£2.6bn previously). \n   \n \n \n \n \n \n \n \n 2025 Statutory Guidance \n \n \n 2026 Statutory Guidance \n \n \n \n \n Gross customer interest-earning balances \n \n \n >£2.6bn \n \n \n c.£3.0bn \n \n \n \n \n ROTE \n \n \n Low single digits \n \n \n Low double digits \n \n \n \n \n NIM \n \n \n >17% \n \n \n >16% \n \n \n \n \n Cost: income ratio \n \n \n High 50s \n \n \n Low 50s \n \n \n \n \n Tier 1 ratio \n \n \n >17.5% \n \n \n \n \n \n \n \n   \n In 2027, continue to guide to mid-teens ROTE and a cost: income ratio of 49% or lower. \n   \n As announced with FY24 results, the Group has transitioned to reporting solely on a statutory basis.  Accordingly, the guidance outlined above is on a statutory basis.  \n   \n Capital Management and Dividend \n   \n ·    With the focus on deploying capital to support growth initiatives, the Board of Directors has decided not to declare a dividend for 1H25 (1H24: no dividend). \n ·    The Board intends to revisit the capital allocation framework and dividend policy following full delivery of the strategy in 2026. \n   \n 1H25 Operational Highlights \n   \n Customer proposition and insightful risk management update \n   \n ·    Credit Cards : Launched new product variants, offering customers more tailored options to meet diverse financial needs. \n ·    Vehicle Finance : Enhanced credit decisioning, improving the speed and accuracy of lending decisions. \n ·    Second Charge Mortgages: Maintained strong growth, supporting more customers through a forward flow agreement with Interbridge Mortgages and a partnership with Selina Finance. \n ·    Savings : Strengthened cost-effective funding capabilities with an expanded product range , including ISAs and the Snoop -branded easy access product. \n ·    Snoop: Active users rose 7% to 313k, with Vanquis customers up 12% to 42k. Snoop remains a cost-effective acquisition channel , with origination costs around 10% of other channels , while offering valuable money management tools. \n ·    Fair Finance: Delivered positive outcomes for 'Not Yet' customers through the referral programme, helping them access affordable credit and nearly £10 million in unclaimed government benefits . \n ·    Customer experience: Introduced a new service platform, enabling faster, more personalised support and improving overall customer satisfaction . \n   \n Technology transformation, operational efficiency and people update \n   \n ·      Gateway transformation on track: A major milestone saw 30 billion rows of customer, product, and decisioning data loaded onto our new IT platform, significantly enhancing insight generation and decision-making capabilities. \n ·      Upcoming launches: Preparing to launch a new mobile app and a smarter credit card onboarding and decisioning platform within the next three months. \n ·      Operational efficiency: Delivered improvements across debt sales, fraud controls, and complaints handling through expanded use of digital tools, AI, and self-service, and rationalised property footprint. \n ·      Colleague engagement: Mid-year engagement score rose by 5 percentage points to 65%. \n   \n Update on External Factors \n   \n Complaints update \n   \n ·    Complaint costs reduced 36% year-on-year to £16.1m , with FOS fees reducing £8.6m to £4.5m.  1Q25 complaint costs were in line with expectations, with a lower run rate from 2Q25, as expected following the implementation of the revised FOS fee structure.  The Group expects 2H25 complaint costs to be lower than 1H25. \n ·    Since the revised FOS fee structure was implemented on 1 April 2025, Vanquis related CMC complaints referred to the FOS have been negligible. \n o  CMCs are charged an upfront fee of £250 for each claim submitted, reducing to £75 for upheld cases. \n o  Lender fees have reduced from £650 per case to £475 for each case not upheld. \n ·    Vanquis continues to engage with regulators to address complaints issues on an industry-wide basis. \n ·    The Group supports the Government's planned changes to reform the FOS. \n ·    Following the successful strike out hearing outcome in the court case against The Money Solicitor (TMS Legal Ltd.), the CMC responsible for the most unmerited claims in recent years, legal proceedings now progress to trial. \n   \n Motor finance commission disclosures update \n   \n ·    The Group welcomes the clarity provided by the recent Supreme Court Judgment regarding motor finance commission disclosure practices. The Supreme Court concluded that motor dealers, when acting as credit brokers, do not owe fiduciary duties to their customers. \n ·    In the Johnson case, the Supreme Court found that an unfair relationship existed between the lender and the borrower under section 140A of the Consumer Credit Act 1974. However, the Court emphasized that the test for unfairness is highly fact-sensitive, requiring assessment across a broad range of circumstances. \n ·    The Group acknowledges the FCA's intention to consult on a motor finance compensation scheme.  The FCA propose the scheme covers discretionary commission arrangements (DCAs).  Vanquis did not participate in DCAs and would therefore not be in scope for this element of any scheme. \n ·    Whilst the FCA also intend to consult on the inclusion of certain non-discretionary commission arrangements following the unfair relationship Supreme Court decision in the Johnson case, Vanquis believes its position is clearly differentiated on a number of grounds . These include, but are not limited to, the fact the Group provided significantly better commission disclosures than those in Johnson, with substantially lower average commissions relative to the charge for credit.  Vehicle Finance customers also signed pre-contractual documentation confirming that a commission will be paid. \n ·    As a result, the Group believes that any liability is limited and, as such, in accordance with IAS 37, has not made a provision for this matter, but has disclosed a contingent liability. \n ·    The FCA has extended the timeline on Vehicle Finance commission complaints, currently running until 4 December 2025, which is subject to further extension. \n ·    As of 4 August 2025, the Group had received approximately 16,700 complaints alleging an unfair relationship related to the commission amount - out of around 62,000 total complaints under the extension. This marks an increase from around 4,500 at the end of 2024, driven by heightened public awareness following recent legal and regulatory developments. \n ·    Around 99% of these complaints have been submitted by CMCs. \n ·    The Group has successfully defended 46 out of 49 Vehicle Finance commission court cases. Additionally, over 400 decisions at the FOS Adjudicator level have been in the Group's favour, with no adverse outcomes to date. \n ·    Vanquis remains confident in its position and continues to assess each complaint on its individual merits. \n   \n Results webcast \n   \n Ian McLaughlin, CEO, and Dave Watts, CFO, will host a results webcast at 09:00 today. To register your attendance, please use this link: https://webcast.openbriefing.com/vanquis-2025/ \n   \n Materials for the results presentation have been published at: Results, Reports and Presentations | Vanquis \n   \n Enquiries \n   \n Investors and analysts \n James Cranstoun, Head of Investor Relations \n [email protected] \n +44 (0) 7766 937 406 \n   \n Media \n Scott Mowbray, Head of External Communications \n [email protected] \n +44 (0) 7834 843 384 \n   \n Victoria Ainsworth, Senior Director (Hawthorn Advisors) \n [email protected] \n +44 (0) 7894 995 886 \n   \n Footnotes \n   \n 1.     The presentation of the income statement and selected key metrics in this report is consistent with that in the Annual Report and Accounts for 31 December 2024, with the exception of the impact of the sale of the Personal Loans portfolio, which is now recognised as a discontinued operation and the re-segmentation of interest income, interest expense and operating costs by product .  Further details are included in the 2024 re-presentation document at the following link: Vanquis-Banking-Group-2024-Re-presentation-Document.pdf . \n 2.     Asset yield is calculated as interest income received from customers for the period as a percentage of average gross customer interest-earning balances for the 6 months ended 30 June and 31 December using a 7 point month end average. \n 3.     Net interest margin is calculated as interest income less interest expense for the period as a percentage of average gross customer interest-earning balances for the 6 months ended 30 June and 31 December using a 7 point month end average. \n 4.     Total income margin is calculated as total income for the period as a percentage of average gross customer interest-earning balances for the 6 months ended 30 June and 31 December using a 7 point month end average. \n 5.     Cost of risk is calculated as impairment charges for the period as a percentage of average gross customer interest-earning balances for the 6 months ended 30 June and 31 December using a 7 point month end average. \n 6.     Risk-adjusted margin is defined as risk-adjusted income for the period as a percentage of average gross customer interest-earning balances for the 6 months ended 30 June and 31 December using a 7 point month end average. \n 7.     Cost: income ratio is calculated as operating costs as a percentage of total income for the 6 months ended 30 June and 31 December. \n 8.     ROTE is calculated as annualised statutory profit after tax for the 6 months ended 30 June and 31 December as a percentage of average tangible equity for the 6 months ended 30 June and 31 December. Tangible equity is stated as equity after deducting the Group's pension asset, net of deferred tax, less intangible assets and goodwill. \n 9.     Basic earnings per share is calculated as statutory profit after tax for the 6 months ended 30 June and 31 December, divided by the weighted average number of shares in issue. \n 10.  TNAV per share is calculated as closing tangible net asset value, divided by the period end number of shares in issue.  Tangible net asset value is stated as equity after deducting the Group's pension asset, net of deferred tax, less intangible assets and goodwill. \n 11.  The Tier 1 ratio is calculated as the ratio of the Group's Tier 1 capital as a percentage of the Group's risk-weighted assets measured in accordance with the CRR. \n 12.  Retail funding as a percentage of all funding has been restated to include Tier 2 capital within the total on-balance sheet funding of the Group. \n   \n Forward looking statements \n This report may contain certain \"forward looking statements\" regarding the financial position, business strategy or plans for future operations of Vanquis Banking Group. All statements other than statements of historical fact included in this document may be forward looking statements. Forward looking statements also often use words such as \"believe\", \"expect\", \"estimate\", \"intend\", \"anticipate\" and words of a similar meaning. By their nature, forward looking statements involve risk and uncertainty that could cause actual results to differ from those suggested by them. Much of the risk and uncertainty relates to factors that are beyond Vanquis Banking Group's ability to control or estimate precisely, such as future market conditions and the behaviours of other market participants, and therefore undue reliance should not be placed on such statements which speak only as at the date of this report. Vanquis Banking Group does not assume any obligation to, and does not intend to, revise or update these forward-looking statements, except as required pursuant to applicable law or regulation. No statement in this announcement is intended as a profit forecast or estimate for any period. No statement in this announcement should be interpreted to indicate a particular level of profit and, as a consequence, it should not be possible to derive a profit figure for any future period from this report. \n   \n Operating review \n   \n Segmental product performance \n   \n \n \n \n \n 1H25 £m \n \n \n Credit Cards \n \n \n Vehicle Finance \n \n \n Second Charge Mortgages \n \n \n Corporate Centre \n \n \n Total \n \n \n \n \n Interest income \n \n \n 179.0 \n \n \n 62.9 \n \n \n 11.0 \n \n \n 22.0 \n \n \n 274.9 \n \n \n \n \n Interest expense \n \n \n (24.7) \n \n \n (14.3) \n \n \n (6.7) \n \n \n (27.0) \n \n \n (72.7) \n \n \n \n \n Net interest income \n \n \n 154.3 \n \n \n 48.6 \n \n \n 4.3 \n \n \n (5.0) \n \n \n 202.2 \n \n \n \n \n Non-interest income \n \n \n 16.0 \n \n \n - \n \n \n 0.2 \n \n \n 1.3 \n \n \n 17.5 \n \n \n \n \n Total income \n \n \n 170.3 \n \n \n 48.6 \n \n \n 4.5 \n \n \n (3.7) \n \n \n 219.7 \n \n \n \n \n Impairment charges \n \n \n (64.0) \n \n \n (12.7) \n \n \n (0.2) \n \n \n 0.8 \n \n \n (76.1) \n \n \n \n \n Risk-adjusted income \n \n \n 106.3 \n \n \n 35.9 \n \n \n 4.3 \n \n \n (2.9) \n \n \n 143.6 \n \n \n \n \n Operating costs \n \n \n (93.7) \n \n \n (34.5) \n \n \n (1.9) \n \n \n (7.3) \n \n \n (137.4) \n \n \n \n \n Profit/(loss) before tax from continuing operations \n \n \n 12.6 \n \n \n 1.4 \n \n \n 2.4 \n \n \n (10.2) \n \n \n 6.2 \n \n \n \n \n   \n   \n \n \n \n \n 2H24 (Re-presented) £m \n \n \n Credit  Cards \n \n \n Vehicle Finance \n \n \n Second Charge Mortgages \n \n \n Corporate Centre \n \n \n Total \n \n \n \n \n Interest income \n \n \n 182.1 \n \n \n 63.4 \n \n \n 4.6 \n \n \n 23.8 \n \n \n 273.9 \n \n \n \n \n Interest expense \n \n \n (26.3) \n \n \n (15.7) \n \n \n (3.1) \n \n \n (28.2) \n \n \n (73.3) \n \n \n \n \n Net interest income \n \n \n 155.8 \n \n \n 47.7 \n \n \n 1.5 \n \n \n (4.4) \n \n \n 200.6 \n \n \n \n \n Non-interest income \n \n \n 16.4 \n \n \n - \n \n \n - \n \n \n 2.6 \n \n \n 19.0 \n \n \n \n \n Total income \n \n \n 172.2 \n \n \n 47.7 \n \n \n 1.5 \n \n \n (1.8) \n \n \n 219.6 \n \n \n \n \n Impairment charges \n \n \n (60.4) \n \n \n (30.9) \n \n \n (0.2) \n \n \n (0.8) \n \n \n (92.3) \n \n \n \n \n Risk-adjusted income \n \n \n 111.8 \n \n \n 16.8 \n \n \n 1.3 \n \n \n (2.6) \n \n \n 127.3 \n \n \n \n \n Operating costs \n \n \n (93.0) \n \n \n (37.3) \n \n \n (0.4) \n \n \n (88.5) \n \n \n (219.2) \n \n \n \n \n Profit/(loss) before tax from continuing operations \n \n \n 18.8 \n \n \n (20.5) \n \n \n 0.9 \n \n \n (91.1) \n \n \n (91.9) \n \n \n \n \n   \n \n \n \n \n 1H24 (Re-presented) £m \n \n \n Credit  Cards \n \n \n Vehicle Finance \n \n \n Second Charge Mortgages \n \n \n Corporate Centre \n \n \n Total \n \n \n \n \n Interest income \n \n \n 183.6 \n \n \n 69.7 \n \n \n 0.2 \n \n \n 22.5 \n \n \n 276.0 \n \n \n \n \n Interest expense \n \n \n (26.9) \n \n \n (15.7) \n \n \n (0.3) \n \n \n (25.8) \n \n \n (68.7) \n \n \n \n \n Net interest income \n \n \n 156.7 \n \n \n 54.0 \n \n \n (0.1) \n \n \n (3.3) \n \n \n 207.3 \n \n \n \n \n Non-interest income \n \n \n 18.6 \n \n \n - \n \n \n - \n \n \n 0.9 \n \n \n 19.5 \n \n \n \n \n Total income \n \n \n 175.3 \n \n \n 54.0 \n \n \n (0.1) \n \n \n (2.4) \n \n \n 226.8 \n \n \n \n \n Impairment charges \n \n \n (63.5) \n \n \n (29.5) \n \n \n - \n \n \n - \n \n \n (93.0) \n \n \n \n \n Risk-adjusted income \n \n \n 111.8 \n \n \n 24.5 \n \n \n (0.1) \n \n \n (2.4) \n \n \n 133.8 \n \n \n \n \n Operating costs \n \n \n (100.5) \n \n \n (42.8) \n \n \n (0.2) \n \n \n (36.4) \n \n \n (179.9) \n \n \n \n \n Profit/(loss) before tax from continuing operations \n \n \n 11.3 \n \n \n (18.3) \n \n \n (0.3) \n \n \n (38.8) \n \n \n (46.1) \n \n \n \n \n   \n   \n Credit Cards - Returned to balance growth in 2Q25, while adopting a risk-based pricing approach \n   \n \n \n \n \n Six months ended (£m) \n \n \n Jun-25 \n \n \n Dec-24 \n (Re-presented) \n \n \n Jun-24 \n (Re-presented) \n \n \n HoH \n Change % \n \n \n YoY \n Change % \n \n \n \n \n Total customer numbers ('000) \n \n \n 1,290 \n \n \n 1,267 \n \n \n 1,321 \n \n \n 2 \n \n \n (2) \n \n \n \n \n Gross customer interest-earning balances \n \n \n 1,355 \n \n \n 1,278 \n \n \n 1,295 \n \n \n 6 \n \n \n 5 \n \n \n \n \n Average gross customer interest-earning balances 1 \n \n \n 1,296 \n \n \n 1,284 \n \n \n 1,339 \n \n \n 1 \n \n \n (3) \n \n \n \n \n Gross receivables \n \n \n 1,390 \n \n \n 1,310 \n \n \n 1,331 \n \n \n 6 \n \n \n 4 \n \n \n \n \n Net receivables \n \n \n 1,232 \n \n \n 1,150 \n \n \n 1,151 \n \n \n 7 \n \n \n 7 \n \n \n \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Interest income \n \n \n 179.0 \n \n \n 182.1 \n \n \n 183.6 \n \n \n (2) \n \n \n (3) \n \n \n \n \n Interest expense \n \n \n (24.7) \n \n \n (26.3) \n \n \n (26.9) \n \n \n (6) \n \n \n (8) \n \n \n \n \n Net interest income \n \n \n 154.3 \n \n \n 155.8 \n \n \n 156.7 \n \n \n (1) \n \n \n (2) \n \n \n \n \n Non-interest income \n \n \n 16.0 \n \n \n 16.4 \n \n \n 18.6 \n \n \n (2) \n \n \n (14) \n \n \n \n \n Total income \n \n \n 170.3 \n \n \n 172.2 \n \n \n 175.3 \n \n \n (1) \n \n \n (3) \n \n \n \n \n Impairment charges \n \n \n (64.0) \n \n \n (60.4) \n \n \n (63.5) \n \n \n 6 \n \n \n 1 \n \n \n \n \n Risk adjusted income \n \n \n 106.3 \n \n \n 111.8 \n \n \n 111.8 \n \n \n (5) \n \n \n (5) \n \n \n \n \n Operating costs \n \n \n (93.7) \n \n \n (93.0) \n \n \n (100.5) \n \n \n 1 \n \n \n (7) \n \n \n \n \n Profit before tax contribution \n \n \n 12.6 \n \n \n 18.8 \n \n \n 11.3 \n \n \n (33) \n \n \n 12 \n \n \n \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Asset yield (%) 2 \n \n \n 27.8 \n \n \n 28.2 \n \n \n 27.6 \n \n \n (0.4) \n \n \n 0.2 \n \n \n \n \n Net interest margin (%) 3 \n \n \n 24.0 \n \n \n 24.1 \n \n \n 23.5 \n \n \n (0.1) \n \n \n 0.5 \n \n \n \n \n Total income margin (%) 4 \n \n \n 26.5 \n \n \n 26.7 \n \n \n 26.3 \n \n \n (0.2) \n \n \n 0.2 \n \n \n \n \n Cost of risk (%) 5 \n \n \n (10.0) \n \n \n (9.4) \n \n \n (9.5) \n \n \n (0.6) \n \n \n (0.5) \n \n \n \n \n Risk adjusted margin (%) 6 \n \n \n 16.5 \n \n \n 17.3 \n \n \n 16.8 \n \n \n (0.8) \n \n \n (0.3) \n \n \n \n \n Cost: income ratio (%) 7 \n \n \n 55.0 \n \n \n 54.0 \n \n \n 57.3 \n \n \n 1.0 \n \n \n (2.3) \n \n \n \n \n   \n 1 Average of gross customer interest-earning balances for the 6 months ended 30 June and 31 December using a 7 point month end average. \n 2 Interest income from customer receivables for the 6 months ended 30 June and 31 December as a percentage of average gross customer interest-earning balances. \n 3 Net interest income for the 6 months ended 30 June and 31 December as a percentage of average gross customer interest-earning balances. \n 4 Total income for the 6 months ended 30 June and 31 December as a percentage of average gross customer interest-earning balances. \n 5 Impairment charges for the 6 months ended 30 June and 31 December as a percentage of average gross customer interest-earning balances. \n 6 Total income less impairment charges for the 6 months ended 30 June and 31 December as a percentage of average gross customer interest-earning balances. \n 7 Operating costs as a percentage of total income for the 6 months ended 30 June and 31 December. \n   \n All commentary relates to year-on-year performance unless otherwise stated. \n   \n Total customer numbers decreased 2% to 1,290k, but increased 2% from December 2024, reflecting a return to growth in 2Q25 following a comprehensive review of customer cohorts by risk profile, vintage and acquisition channel to ensure the future sustainable profitability of the portfolio . \n   \n Gross customer interest-earning balances increased 5% to £1,355m, all in 2Q25 following stable balances in 1Q25, reflecting both credit line increases of existing customers, and new customer growth following the release of new product variants. \n   \n Net receivables increased 7% to £1,232m, reflecting the growth in interest-earning balances and a 12% reduction in ECL to £158m, driven by a better quality portfolio, with increased balances in Stage 1 and 2 and a reduction in Stage 3 balances. \n   \n Total income decreased 3% to £170.3m. Net interest income reduced 2% to £154.3m, with non-interest income decreasing 14% to £16.0m.  Net interest margin increased 0.5% to 24.0% and total income margin increased 0.2% to 26.5%. \n   \n Interest income decreased 3% to £179.0m, consistent with a 3% reduction in average gross customer interest-earning balances to £1,296m.  Asset yield increased 0.2% to 27.8%, driven by risk-based repricing initiatives and despite growth in 0% balance transfers (BTs) and products. \n   \n Interest expense reduced 8% to £24.7m, driven by the lower funding need and lower cost of funds, as the reduced rate outlook and maturing fixed-term deposits were refinanced with lower interest rate savings products. \n   \n Impairment charges were broadly stable at £64.0m (1H24: £63.5m), reflecting increased origination charges in line with growth in new gross customer interest earning balances offset by an increased IFRS9 modelled impairment benefit, as underlying credit quality improved. Cost of risk increased 0.5% to 10.0%. \n   \n Risk adjusted income decreased 5% to £106.3m, driving a 0.3% reduction in risk adjusted margin to 16.5%. \n   \n Operating costs decreased 7% to £93.7m, driven by transformation cost savings and lower complaint costs, more than offsetting growth and inflation driven cost increases and an accrual for discretionary staff costs. \n   \n Profit before tax contribution increased 12% to £12.6m. \n   \n   \n Vehicle Finance - Moderated new business growth, while product profitability improved \n   \n \n \n \n \n Six months ended (£m) \n \n \n Jun-25 \n \n \n Dec-24 \n (Re-presented) \n \n \n Jun-24 \n (Re-presented) \n \n \n HoH \n Change % \n \n \n YoY \n Change % \n \n \n \n \n Total customer numbers ('000) \n \n \n 106 \n \n \n 110 \n \n \n 110 \n \n \n (4) \n \n \n (4) \n \n \n \n \n Gross customer interest-earning balances \n \n \n 733 \n \n \n 765 \n \n \n 850 \n \n \n (4) \n \n \n (14) \n \n \n \n \n Average gross customer interest-earning balances 1 \n \n \n 750 \n \n \n 803 \n \n \n 851 \n \n \n (7) \n \n \n (12) \n \n \n \n \n Gross receivables \n \n \n 795 \n \n \n 832 \n \n \n 921 \n \n \n (4) \n \n \n (14) \n \n \n \n \n Net receivables \n \n \n 709 \n \n \n 735 \n \n \n 760 \n \n \n (4) \n \n \n (7) \n \n \n \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Interest income \n \n \n 62.9 \n \n \n 63.4 \n \n \n 69.7 \n \n \n (1) \n \n \n (10) \n \n \n \n \n Interest expense \n \n \n (14.3) \n \n \n (15.7) \n \n \n (15.7) \n \n \n (9) \n \n \n (9) \n \n \n \n \n Net interest income \n \n \n 48.6 \n \n \n 47.7 \n \n \n 54.0 \n \n \n 2 \n \n \n (10) \n \n \n \n \n Total income \n \n \n 48.6 \n \n \n 47.7 \n \n \n 54.0 \n \n \n 2 \n \n \n (10) \n \n \n \n \n Impairment charges \n \n \n (12.7) \n \n \n (30.9) \n \n \n (29.5) \n \n \n (59) \n \n \n (57) \n \n \n \n \n Risk adjusted income \n \n \n 35.9 \n \n \n 16.8 \n \n \n 24.5 \n \n \n 114 \n \n \n 47 \n \n \n \n \n Operating costs \n \n \n (34.5) \n \n \n (37.3) \n \n \n (42.8) \n \n \n (8) \n \n \n (19) \n \n \n \n \n Profit/(loss) before tax contribution \n \n \n 1.4 \n \n \n (20.5) \n \n \n (18.3) \n \n \n \n \n \n \n \n \n \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Asset yield (%) 2 \n \n \n 16.9 \n \n \n 15.7 \n \n \n 16.5 \n \n \n 1.2 \n \n \n 0.4 \n \n \n \n \n Net interest margin (%) 3 \n \n \n 13.1 \n \n \n 11.8 \n \n \n 12.8 \n \n \n 1.3 \n \n \n 0.3 \n \n \n \n \n Total income margin (%) 4 \n \n \n 13.1 \n \n \n 11.8 \n \n \n 12.8 \n \n \n 1.3 \n \n \n 0.3 \n \n \n \n \n Cost of risk (%) 5 \n \n \n (3.4) \n \n \n (7.7) \n \n \n (7.0) \n \n \n 4.3 \n \n \n 3.6 \n \n \n \n \n Risk adjusted margin (%) 6 \n \n \n 9.7 \n \n \n 4.2 \n \n \n 5.8 \n \n \n 5.5 \n \n \n 3.9 \n \n \n \n \n Cost: income ratio (%) 7 \n \n \n 71.0 \n \n \n 78.2 \n \n \n 79.3 \n \n \n (7.2) \n \n \n (8.3) \n \n \n \n \n   \n 1 Average of gross customer interest-earning balances for the 6 months ended 30 June and 31 December using a 7 point month end average. \n 2 Interest income from customer receivables for the 6 months ended 30 June and 31 December as a percentage of average gross customer interest-earning balances. \n 3 Net interest income for the 6 months ended 30 June and 31 December as a percentage of average gross customer interest-earning balances. \n 4 Total income for the 6 months ended 30 June and 31 December as a percentage of average gross customer interest-earning balances. \n 5 Impairment charges for the 6 months ended 30 June and 31 December as a percentage of average gross customer interest-earning balances. \n 6 Total income less impairment charges for the 6 months ended 30 June and 31 December as a percentage of average gross customer interest-earning balances. \n 7 Operating costs as a percentage of total income for the 6 months ended 30 June and 31 December. \n   \n All commentary relates to year-on-year performance unless otherwise stated. \n   \n Total customer numbers decreased 4% to 106k, reflecting moderated new business growth in the near-term in advance of the new onboarding and servicing platform being delivered by mid-2026 as part of the Gateway technology transformation.  A new lending decision engine was introduced in 2024 enabling a more granular level of portfolio segmentation and delivered a stronger platform to optimise higher-margin customer segments in 1H25. \n   \n Gross customer interest-earning balances decreased 14% to £733m, driven by the combination of the prior year impact of the Vehicle Finance receivables review resulting in an updated charge-off policy reclassifying Stage 3 impaired loans to post-charge-off assets, and the moderating of new business growth.  \n   \n Net receivables decreased 7% to £709m, r eflecting the reduction in interest-earning balances and a 46% reduction in ECL to £86m.  ECL reduced across stages given the reduction in balances, but particularly in Stage 3 driven by the reduction in impaired loans following the receivables review. \n   \n Total income decreased 10% to £48.6m, which represented all net interest income.  Net interest margin and total income margin increased 0.3% respectively to 13.1%.  \n   \n Interest income decreased 10% to £62.9m, consistent with a 12% reduction in average gross customer interest-earning balances to £750m.  The asset yield increased 0.4% to 16.9%, driven by repricing initiatives. \n   \n Interest expense reduced 9% to £14.3m, driven by the lower funding need and lower cost of funds, as the reduced rate outlook and maturing fixed-term deposits were refinanced with lower interest rate savings products. \n   \n The prior year Vehicle Finance receivables review drove elevated impairment in 2024, resulting in a clearer cost of risk outlook for the portfolio.  Impairment charges decreased 57% to £12.7m, reflecting reduced origination charges in line with the reduction in new gross customer interest-earning balances and an increased IFRS9 modelled impairment benefit, as underlying credit quality improved. Cost of risk reduced 3.6% to 3.4%. \n   \n Risk adjusted income increased 47% to £35.9m and risk adjusted margin improved 3.9% to 9.7%. \n   \n Operating costs decreased 19% to £34.5m, driven by transformation cost savings, more than offsetting growth and inflation driven cost increases and an accrual for discretionary staff costs. \n   \n Profit before tax contribution was £1.4m (1H24: loss contribution of £18.3m). \n   \n Second Charge Mortgages - Continued strong growth in a growing market \n   \n \n \n \n \n Six months ended (£m) \n \n \n Jun-25 \n \n \n Dec-24 \n (Re-presented) \n \n \n Jun-24 \n (Re-presented) \n \n \n HoH \n Change % \n \n \n \n \n Total customer numbers ('000) \n \n \n 6.3 \n \n \n 3.7 \n \n \n 0.6 \n \n \n 70 \n \n \n \n \n Gross customer interest-earning balances \n \n \n 371 \n \n \n 217 \n \n \n 30 \n \n \n 71 \n \n \n \n \n Average gross customer interest-earning balances 1 \n \n \n 293 \n \n \n 121 \n \n \n 11 \n \n \n 142 \n \n \n \n \n Gross receivables \n \n \n 385 \n \n \n 226 \n \n \n 32 \n \n \n 70 \n \n \n \n \n Net receivables \n \n \n 385 \n \n \n 225 \n \n \n 32 \n \n \n 71 \n \n \n \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Interest income \n \n \n 11.0 \n \n \n 4.6 \n \n \n 0.2 \n \n \n 139 \n \n \n \n \n Interest expense \n \n \n (6.7) \n \n \n (3.1) \n \n \n (0.3) \n \n \n 116 \n \n \n \n \n Net interest income \n \n \n 4.3 \n \n \n 1.5 \n \n \n (0.1) \n \n \n 187 \n \n \n \n \n Non-interest income \n \n \n 0.2 \n \n \n - \n \n \n - \n \n \n 100 \n \n \n \n \n Total income \n \n \n 4.5 \n \n \n 1.5 \n \n \n (0.1) \n \n \n 200 \n \n \n \n \n Impairment charges \n \n \n (0.2) \n \n \n (0.2) \n \n \n - \n \n \n - \n \n \n \n \n Risk adjusted income \n \n \n 4.3 \n \n \n 1.3 \n \n \n (0.1) \n \n \n 231 \n \n \n \n \n Operating costs \n \n \n (1.9) \n \n \n (0.4) \n \n \n (0.2) \n \n \n 375 \n \n \n \n \n Profit/(loss) before tax contribution \n \n \n 2.4 \n \n \n 0.9 \n \n \n (0.3) \n \n \n 167 \n \n \n \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Asset yield (%) 2 \n \n \n 7.6 \n \n \n 7.6 \n \n \n n/m \n \n \n - \n \n \n \n \n Net interest margin (%) 3 \n \n \n 3.0 \n \n \n 2.5 \n \n \n n/m \n \n \n 0.5 \n \n \n \n \n Total income margin (%) 4 \n \n \n 3.1 \n \n \n 2.5 \n \n \n n/m \n \n \n 0.6 \n \n \n \n \n Cost of risk (%) 5 \n \n \n (0.1) \n \n \n (0.3) \n \n \n n/m \n \n \n 0.2 \n \n \n \n \n Risk adjusted margin (%) 6 \n \n \n 3.0 \n \n \n 2.1 \n \n \n n/m \n \n \n 0.9 \n \n \n \n \n Cost: income ratio (%) 7 \n \n \n 42.2 \n \n \n 26.7 \n \n \n n/m \n \n \n 15.5 \n \n \n \n \n   \n 1 Average of gross customer interest-earning balances for the 6 months ended 30 June and 31 December using a 7 point month end average. \n 2 Interest income from customer receivables for the 6 months ended 30 June and 31 December as a percentage of average gross customer interest-earning balances. \n 3 Net interest income for the 6 months ended 30 June and 31 December as a percentage of average gross customer interest-earning balances. \n 4 Total income for the 6 months ended 30 June and 31 December as a percentage of average gross customer interest-earning balances. \n 5 Impairment charges for the 6 months ended 30 June and 31 December as a percentage of average gross customer interest-earning balances. \n 6 Total income less impairment charges for the 6 months ended 30 June and 31 December as a percentage of average gross customer interest-earning balances. \n 7 Operating costs as a percentage of total income for the 6 months ended 30 June and 31 December. \n   \n All commentary relates to year-on-year performance unless otherwise stated. \n   \n Total customer numbers increased to 6.3k (June 2024: 0.6k) following the successful growth of the forward flow agreement with Interbridge Mortgages and expanded partnership with Selina Finance .  \n   \n Gross customer interest-earning balances increased to £371m (June 2024: £30m) and net receivables increased to £385m (June 2024: £32m), which includes deferred acquisition costs. \n   \n Total income increased to £4.5m (1H24: £(0.1)m).  Net interest margin was 3.0% and total income margin was 3.1%. \n   \n Interest income increased to £11.0m (1H24: £0.2m) with an asset yield of 7.6%.  Interest expense was £6.7m (1H24: £0.3m). \n   \n Risk adjusted income increased to £4.3m (1H24: £(0.1)m), including impairment charges of £0.2m (1H24: £0.0m). Cost of risk was 0.1% and risk adjusted margin was 3.0%. \n   \n Operating costs were £1.9m (1H24: £0.2m), reflecting the limited fixed costs associated with the business given the origination partnership arrangements in place. \n   \n Profit before tax contribution was £2.4m (1H24: loss contribution of £(0.3)m). \n   \n Corporate Centre \n   \n \n \n \n \n Six months ended (£m) \n \n \n Jun-25 \n \n \n Dec-24 \n (Re-presented) \n \n \n Jun-24 (Re-presented) \n \n \n HoH \n Change % \n \n \n YoY \n Change % \n \n \n \n \n Interest income \n \n \n 22.0 \n \n \n 23.8 \n \n \n 22.5 \n \n \n (8) \n \n \n (2) \n \n \n \n \n Interest expense \n \n \n (27.0) \n \n \n (28.2) \n \n \n (25.8) \n \n \n (4) \n \n \n 5 \n \n \n \n \n Net interest income \n \n \n (5.0) \n \n \n (4.4) \n \n \n (3.3) \n \n \n 14 \n \n \n 52 \n \n \n \n \n Non-interest income \n \n \n 1.3 \n \n \n 2.6 \n \n \n 0.9 \n \n \n (50) \n \n \n 44 \n \n \n \n \n Total income \n \n \n (3.7) \n \n \n (1.8) \n \n \n (2.4) \n \n \n 106 \n \n \n 54 \n \n \n \n \n Impairment charges \n \n \n 0.8 \n \n \n (0.8) \n \n \n - \n \n \n \n \n \n 100 \n \n \n \n \n Risk adjusted income \n \n \n (2.9) \n \n \n (2.6) \n \n \n (2.4) \n \n \n 12 \n \n \n 21 \n \n \n \n \n Operating costs \n \n \n (7.3) \n \n \n (88.5) \n \n \n (36.4) \n \n \n (92) \n \n \n (80) \n \n \n \n \n Loss before tax contribution \n \n \n (10.2) \n \n \n (91.1) \n \n \n (38.8) \n \n \n (89) \n \n \n (74) \n \n \n \n \n   \n Corporate Centre includes the retail savings business, including related costs, unallocated Treasury result after product allocations, Snoop income and costs and other immaterial or central items. \n   \n All commentary relates to year-on-year performance unless otherwise stated. \n   \n Total income was a net expense of £(3.7)m (1H24: £(2.4)m), with net interest income being a net expense of £(5.0)m (1H24: £(3.3)m) and non-interest income increasing to £1.3m (1H24: £0.9m) driven by fees and commissions income from Snoop. \n   \n Interest income of £22.0m (1H24: £22.5m) represented returns from the Liquid Asset Buffer (LAB), including UK gilts and interest on cash reserves in the BoE reserve account. \n   \n Interest expense of £27.0m (1H24: £25.8m) represented residual funding costs not allocated to the respective businesses, including unallocated Tier 2 capital. \n   \n Operating costs reduced to £7.3m (1H24: £36.4m), reflecting the non-repeat of £29.9m of prior year notable items. \n   \n Loss before tax contribution was £(10.2)m (1H24: £(38.8)m). \n   \n Notable items \n   \n \n \n \n \n Six months ended (£m) \n \n \n Account line \n \n \n Segment \n \n \n Jun-25 \n \n \n Dec-24 \n \n \n Jun-24 \n \n \n \n \n Goodwill write-off \n \n \n Operating costs \n \n \n Corporate Centre \n \n \n - \n \n \n (71.2) \n \n \n - \n \n \n \n \n Transformation and other exceptional costs \n \n \n Operating costs \n \n \n Corporate Centre \n \n \n - \n \n \n (8.6) \n \n \n (15.5) \n \n \n \n \n Amortisation of acquisition intangibles \n \n \n Operating costs \n \n \n Corporate Centre \n \n \n - \n \n \n (2.0) \n \n \n (4.2) \n \n \n \n \n Vehicle Finance receivables review \n \n \n Income \n \n \n Vehicle Finance \n \n \n - \n \n \n (1.4) \n \n \n (3.1) \n \n \n \n \n \n \n \n Impairment \n \n \n Vehicle Finance \n \n \n - \n \n \n (5.4) \n \n \n (9.7) \n \n \n \n \n Other one-off cost items \n \n \n Operating costs \n \n \n Corporate Centre \n \n \n - \n \n \n - \n \n \n (10.2) \n \n \n \n \n Total notable items \n \n \n   \n \n \n   \n \n \n - \n \n \n (88.6) \n \n \n (42.7) \n \n \n \n \n   \n Principal Risks and Uncertainties \n   \n The Group's principal risks are those most critical to the alignment and delivery of its Strategy. Principal risk categories and associated risk appetite statements, metrics and thresholds are reviewed and approved by the Board on an annual basis, effectively defining the Group's overall risk appetite. \n   \n Customer Risk \n   \n This is defined as the risk that failing to understand or address customer needs could lead to dissatisfaction, poor customer outcomes, reduced loyalty and reputational damage, impacting revenue and long-term business sustainability. The Group closely monitors customer outcomes to ensure the fair treatment of customers, particularly for customers requiring early intervention strategies or those with vulnerable characteristics, and address customer detriment. Complaints related to responsible lending have declined since the implementation of the FOS fee-charging structure. However, following the recent Supreme Court ruling, the Group continues to await the outcome of the FCA's consultation on a proposed compensation scheme for motor finance customers. \n   \n Regulatory Risk \n   \n This is defined as the risk that non-compliance with all regulatory and legal requirements and expectations could lead to financial penalties, legal action, operational disruptions and long-term damage to reputation. The Group aims to avoid material regulatory breaches and, in the event that they do occur, they are promptly corrected and lessons learned from mistakes made.  Strong and proactive regulatory relationships are in place with the FCA and PRA, who remain up to date with the Group's strategic initiatives, key risk management activities and responses to regulatory developments. \n   \n Financial Crime Risk \n   \n This is defined as the risk that failure to detect and prevent financial crime and fraud could result in customer detriment, regulatory fines, reputational damage and financial loss. The Group has dedicated fraud and financial crime strategic and operational teams, which monitor, investigate and report suspicious activity to meet regulatory obligations, remain vigilant of evolving external emerging threats and protect the Group and our customers from financial crime and fraud. The Group continues to strengthen its financial and fraud control environment through Gateway development. \n   \n Capital Risk \n   \n This is defined as the risk that inadequate capital resources or poor capital planning could result in an inability to meet financial obligations, regulatory breaches and financial instability, potentially threatening the long-term viability of the Group. The Group and Bank operate within a defined capital risk appetite, with performance and capital position reported to and closely monitored by the Risk Committee and Board.  Sufficient capital resources, both in terms of amount and quality, are maintained to support the business strategy and meet the stressed scenarios identified in the Internal Capital Adequacy Assessment Process (ICAAP).  The Group and Bank have remained above regulatory buffer requirements throughout 2025. \n   \n Funding and Liquidity Risk \n   \n This is defined as the risk that the Group has insufficient financial resources to meet its obligations (cash or collateral requirements) as they fall due, resulting in the failure to meet regulatory liquidity requirements, or is only able to secure such resources at excessive cost.  Funding and liquidity metrics are monitored through daily liquidity reporting and reported to the Risk Committee and Board.  The Group's current funding strategy seeks to maintain a secure and diverse funding structure by maintaining access to the liquid retail deposits market and committed facilities to meet the Group's liquidity and funding requirements. Throughout 2025, the Group and Bank have maintained funding and liquidity ratios in excess of regulatory requirements. \n   \n Market Risk \n   \n This is defined as the risk that fluctuations in market prices, such as interest rates, could negatively impact the Group's financial performance, resulting in losses or disruptions. The Group and Bank are primarily exposed to Interest Rate Risk in the Banking Book (IRRBB) and do not take significant unmatched positions or operate trading books. The Group and Bank have remained within risk appetite throughout 2025. Market risk appetite metrics include the risk under different interest rate risk scenarios, as prescribed by regulation, which are reported to the Risk Committee and Board. \n   \n Credit Risk \n   \n This is defined as the risk that customers may default on their obligations, leading to financial losses, impaired asset quality and reputational damage. The credit risk programme, initiated during 2024 to optimise the Group's credit decisioning capability and enhance its credit and affordability strategies, is progressing to plan, ensuring credit risk is at the forefront of business decisioning and keeps pace with changing market and economic conditions.  The Credit Risk Committee meets monthly to oversee the programme and monitor portfolio performance against key credit risk metrics. \n   \n People Risk \n   \n This is defined as the risk that poor recruitment practices, insufficient employee training or low engagement levels caused by poor culture and compliance could lead to operational inefficiencies and reputational damage. To effectively manage people risk, adequate controls exist across the colleague lifecycle covering onboarding, development and management of our colleagues.  The Group's operating model is reviewed to ensure it has sufficient operational capacity and colleagues with the right skills to meet the Group's financial, customer and regulatory responsibilities.  The Pulse Survey completed in June saw the engagement score rise to 65% since the Colleague Survey conducted in December 2024, providing further insight to advocate the Group as a great place to work. \n   \n Technology and Information Security Risk \n   \n This is defined as the risk that inadequate technological, security and data infrastructure and failure to upgrade systems could lead to operational inefficiencies, data breaches, service disruptions, a lack of scalability and reputational damage. Additional focus has been placed on technological advancements, such as artificial intelligence and machine learning, of which supporting governance structures are maturing.  The Group's technology and information security risk is being significantly strengthened through the delivery of the Gateway technology and Data & Analytics transformation programmes, which are progressing to plan \n   \n Operational Risk \n   \n This is defined as the risk that failures in processes, systems or human error could result in business disruptions, financial loss, regulatory action, poor customer outcomes and reputational damage.   Operational risk is inherent to our Group's activities and heightened as we deliver our activities, utilising in-house capability and third-party and outsourced business support, and deliver transformation programmes.  The application of the integrated assurance framework, inclusive of the Group's material controls, seeks to complement the assurance activities of each the three lines of defence. \n   \n Model Risk \n   \n This is defined as the risk that incorrect assumptions, poor design or outdated data within models used for decision making could lead to unintended outcomes, financial loss or operational inefficiencies.  All models and covered tools are required to be added and managed through the model inventory, which is reviewed monthly for completeness and accuracy.  The model risk classification is in place reflecting the PRA's Model Risk Management Principles with clear delineation of responsibilities across the three lines of defence and oversight from the Model Risk Committee and supported by formals sub-working groups. \n   \n Business Performance Risk \n   \n This is defined as the risk that poor performance of key business processes, such as financial management, operations or customer service, could lead to financial losses, reduced market share, threat to the Group's long-term viability and reputational damage.  The Group continues to deliver against its strategic priorities, grow the business and maintain its existing commitments in a safe and controlled way, adopting an effective risk management, strong risk culture and remaining aware of emerging external threats.   \n   \n Consolidated financial statements \n   \n Consolidated income statement for the six months ended 30 June \n   \n \n \n \n \n \n \n \n Note \n \n \n 2025 \n unaudited \n \n \n 2024 1 \n unaudited \n \n \n \n \n   \n \n \n \n \n \n £m  \n \n \n £m  \n \n \n \n \n Interest income \n \n \n 3 \n \n \n 274.9 \n \n \n 276.0 \n \n \n \n \n Interest expense \n \n \n \n \n \n (72.7) \n \n \n (68.7) \n \n \n \n \n Net interest income \n \n \n \n \n \n 202.2 \n \n \n 207.3 \n \n \n \n \n Fee and commission income \n \n \n \n \n \n 18.4 \n \n \n 20.1 \n \n \n \n \n Fee and commission expense \n \n \n \n \n \n (1.5) \n \n \n (0.8) \n \n \n \n \n Net fee and commission income \n \n \n \n \n \n 16.9 \n \n \n 19.3 \n \n \n \n \n Other income and net fair value gains \n \n \n \n \n \n 0.6 \n \n \n 0.2 \n \n \n \n \n Total income \n \n \n \n \n \n 219.7 \n \n \n 226.8 \n \n \n \n \n Impairment charges \n \n \n 9 \n \n \n (76.1) \n \n \n (93.0) \n \n \n \n \n Risk-adjusted income \n \n \n \n \n \n 143.6 \n \n \n 133.8 \n \n \n \n \n Operating costs \n \n \n \n \n \n (137.4) \n \n \n (179.9) \n \n \n \n \n Profit/(loss) before taxation from continuing operations \n \n \n 4 \n \n \n 6.2 \n \n \n (46.1) \n \n \n \n \n Tax (charge)/credit \n \n \n 6 \n \n \n (1.3) \n \n \n 10.6 \n \n \n \n \n Profit/( loss) for the period from continuing operations \n \n \n \n \n \n 4.9 \n \n \n (35.5) \n \n \n \n \n Profit/(loss) after tax for the period from discontinued operations \n \n \n 5 \n \n \n 0.7 \n \n \n (0.3) \n \n \n \n \n Statutory profit/(loss) for the period attributable to equity shareholders \n \n \n \n \n \n 5.6 \n \n \n (35.8) \n \n \n \n \n   \n Consolidated statement of comprehensive income for the six months ended 30 June \n \n \n \n \n \n \n \n Note \n \n \n 2025 \n unaudited \n \n \n 2024 \n unaudited \n \n \n \n \n \n \n \n \n \n \n £m  \n \n \n £m  \n \n \n \n \n Statutory profit/(loss) for the period attributable to equity shareholders \n \n \n \n \n \n 5.6 \n \n \n (35.8) \n \n \n \n \n Items that will not be reclassified subsequently to the income statement: \n \n \n \n \n \n   \n \n \n \n \n \n \n \n - actuarial movements on retirement benefit asset \n \n \n 12 \n \n \n (15.4) \n \n \n (4.5) \n \n \n \n \n - tax on items taken directly to other comprehensive income \n \n \n \n \n \n 3.9 \n \n \n 1.1 \n \n \n \n \n Other comprehensive expense for the period \n \n \n \n \n \n (11.5) \n \n \n (3.4) \n \n \n \n \n Total comprehensive expense for the period attributable to equity shareholders \n \n \n \n \n \n (5.9) \n \n \n (39.2) \n \n \n \n \n   \n Earnings/(loss) per share \n \n \n \n \n   \n \n \n Note \n \n \n 2025 \n unaudited \n \n \n 2024 \n unaudited \n \n \n \n \n   \n \n \n \n \n \n pence  \n \n \n pence  \n \n \n \n \n Basic - continuing operations \n \n \n 7 \n \n \n 1.9 \n \n \n (13.9) \n \n \n \n \n Diluted - continuing operations                                                      \n \n \n 7 \n \n \n 1.9 \n \n \n (13.9) \n \n \n \n \n Basic - Group \n \n \n 7 \n \n \n 2.2 \n \n \n (14.1) \n \n \n \n \n Diluted - Group                                                         \n \n \n 7 \n \n \n 2.1 \n \n \n (14.1) \n \n \n \n \n   \n Dividends per share \n \n \n \n \n   \n \n \n Note \n \n \n 2025 \n unaudited  \n \n \n 2024 \n unaudited \n \n \n \n \n   \n \n \n \n \n \n pence  \n \n \n pence  \n \n \n \n \n Interim dividend                                    \n \n \n 8 \n \n \n - \n \n \n - \n \n \n \n \n Paid in the period - 2023 final \n \n \n 8 \n \n \n - \n \n \n 1.0 \n \n \n \n \n   \n The total amount of dividends paid in the period was £nil (1H24: £2.5m). \n   \n 1 Refer to accounting policies for details of representation \n   \n Consolidated balance sheets \n   \n \n \n \n \n \n \n \n Note \n \n \n 30 June \n 2025 \n unaudited \n \n \n 31 December 2024 \n audited \n \n \n 30 June \n 2024 \n unaudited \n \n \n \n \n \n \n \n \n \n \n £m  \n \n \n £m  \n \n \n £m \n \n \n \n \n ASSETS \n \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n Cash and cash equivalents \n \n \n \n \n \n 805.3 \n \n \n 1,003.9 \n \n \n 772.8 \n \n \n \n \n Investments held at amortised cost \n \n \n \n \n \n 116.5 \n \n \n - \n \n \n - \n \n \n \n \n Amounts receivable from customers \n \n \n 9 \n \n \n 2,325.1 \n \n \n 2,153.7 \n \n \n 2,008.5 \n \n \n \n \n Trade and other receivables \n \n \n \n \n \n 67.0 \n \n \n 72.5 \n \n \n 82.7 \n \n \n \n \n Investments held at fair value through profit and loss \n \n \n \n \n \n 2.3 \n \n \n 2.3 \n \n \n 5.1 \n \n \n \n \n Current tax asset \n \n \n \n \n \n 3.7 \n \n \n 3.9 \n \n \n - \n \n \n \n \n Property, plant and equipment \n \n \n \n \n \n 6.7 \n \n \n 7 .1 \n \n \n 7.4 \n \n \n \n \n Right of use assets \n \n \n \n \n \n 14.2 \n \n \n 16.4 \n \n \n 18.9 \n \n \n \n \n Goodwill \n \n \n 10 \n \n \n 1.2 \n \n \n 1.2 \n \n \n 72.4 \n \n \n \n \n Other intangible assets \n \n \n 11 \n \n \n 62.5 \n \n \n 61.5 \n \n \n 60.2 \n \n \n \n \n Retirement benefit asset \n \n \n 12 \n \n \n 12.7 \n \n \n 27.8 \n \n \n 34.4 \n \n \n \n \n Derivative financial instruments \n \n \n \n \n \n 2.0 \n \n \n - \n \n \n 1.1 \n \n \n \n \n Deferred tax assets \n \n \n \n \n \n 27.5 \n \n \n 25.0 \n \n \n 21.6 \n \n \n \n \n TOTAL ASSETS \n \n \n 4 \n \n \n 3,446.7 \n \n \n 3,375.3 \n \n \n 3,085.1 \n \n \n \n \n LIABILITIES AND EQUITY \n \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n Liabilities \n \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n Trade and other payables \n \n \n \n \n \n 56.0 \n \n \n 46 .1 \n \n \n 49.6 \n \n \n \n \n Provisions \n \n \n 14 \n \n \n 9.2 \n \n \n 15. 5 \n \n \n 16.3 \n \n \n \n \n Lease liabilities \n \n \n \n \n \n 28.3 \n \n \n 32.5 \n \n \n 37.1 \n \n \n \n \n Current tax liability \n \n \n \n \n \n - \n \n \n - \n \n \n 1.2 \n \n \n \n \n Retail deposits \n \n \n \n \n \n 2,463.8 \n \n \n 2,428.2 \n \n \n 1,937.5 \n \n \n \n \n Bank and other borrowings \n \n \n \n \n \n 447.7 \n \n \n 410.0 \n \n \n 504.1 \n \n \n \n \n Derivative financial instruments \n \n \n \n \n \n 7.0 \n \n \n 1.8 \n \n \n 9.6 \n \n \n \n \n Total liabilities \n \n \n \n \n \n 3,012.0 \n \n \n 2,934.1 \n \n \n 2,555.4 \n \n \n \n \n Equity attributable to owners of the parent \n \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n Share capital \n \n \n \n \n \n 53.2 \n \n \n 53.2 \n \n \n 53.2 \n \n \n \n \n Share premium \n \n \n \n \n \n 276.3 \n \n \n 276.3 \n \n \n 276.3 \n \n \n \n \n Merger reserve \n \n \n \n \n \n 278.2 \n \n \n 278.2 \n \n \n 278.2 \n \n \n \n \n Other reserves \n \n \n \n \n \n 8.6 \n \n \n 10.8 \n \n \n 14.5 \n \n \n \n \n Retained earnings \n \n \n \n \n \n (181.6) \n \n \n (177.3) \n \n \n (92.5) \n \n \n \n \n Total equity \n \n \n 4 \n \n \n 434.7 \n \n \n 441.2 \n \n \n 529.7 \n \n \n \n \n TOTAL LIABILITIES AND EQUITY \n \n \n \n \n \n 3,446.7 \n \n \n 3,375.3 \n \n \n 3,085.1 \n \n \n \n \n   \n   \n Consolidated statement of changes in shareholders' equity \n   \n \n \n \n \n \n \n \n Share \n capital \n £m \n \n \n Share \n premium £m \n \n \n Merger reserve \n £m \n \n \n Other \n reserves \n £m \n \n \n Retained \n Earnings \n            £m \n \n \n   \n Total £m \n \n \n \n \n At 1 January 2024 (audited) \n \n \n 53.2 \n \n \n 276.3 \n \n \n 278.2 \n \n \n 12.1 \n \n \n (50.7) \n \n \n 569.1 \n \n \n \n \n Loss for the period \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n (35.8) \n \n \n (35.8) \n \n \n \n \n Other comprehensive (expense)/income: \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n - actuarial movements on retirement benefit asset (note 12) \n \n \n - \n \n \n - \n \n \n   \n - \n \n \n - \n \n \n (4.5) \n \n \n (4.5) \n \n \n \n \n -  tax on items taken directly to OCI \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n 1.1 \n \n \n 1.1 \n \n \n \n \n Other comprehensive expense for the period \n \n \n - \n \n \n - \n \n \n -    \n \n \n - \n \n \n (3.4) \n \n \n (3.4) \n \n \n \n \n Total comprehensive expense for the period \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n (39.2) \n \n \n (39.2) \n \n \n \n \n Share-based payment charge \n \n \n - \n \n \n - \n \n \n - \n \n \n 2.4 \n \n \n - \n \n \n 2.4 \n \n \n \n \n Purchase of shares for share awards \n \n \n \n \n \n \n \n \n \n \n \n - \n \n \n (0.1) \n \n \n (0.1) \n \n \n \n \n Dividends \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n (2.5) \n \n \n (2.5) \n \n \n \n \n At 30 June 2024 and 1 July 2024 (unaudited) \n \n \n 53.2 \n \n \n 276.3 \n \n \n 278.2 \n \n \n 14.5 \n \n \n (92.5) \n \n \n 529.7 \n \n \n \n \n Loss for the period \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n (83.5) \n \n \n (83.5) \n \n \n \n \n Other comprehensive (expense)/income: \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n - actuarial movements on retirement benefit asset (note 12) \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n (7.1) \n \n \n (7.1) \n \n \n \n \n -  tax on items taken directly to OCI \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n 1.8 \n \n \n 1.8 \n \n \n \n \n Other comprehensive expense for the period \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n (5.3) \n \n \n (5.3) \n \n \n \n \n Total comprehensive expense for the period \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n (88.8) \n \n \n (88.8) \n \n \n \n \n Share-based payment charge \n \n \n - \n \n \n - \n \n \n - \n \n \n 0.3 \n \n \n - \n \n \n 0.3 \n \n \n \n \n Transfer of share-based payment reserve on vesting of share awards \n \n \n - \n \n \n - \n \n \n - \n \n \n (4.0) \n \n \n 4.0 \n \n \n - \n \n \n \n \n At 31 December 2024 (audited) \n \n \n 53.2 \n \n \n 276.3 \n \n \n 278.2 \n \n \n 10.8 \n \n \n (177.3) \n \n \n 441.2 \n \n \n \n \n At 1 January 2025 (audited) \n \n \n 53.2 \n \n \n 276.3 \n \n \n 278.2 \n \n \n 10.8 \n \n \n (177.3) \n \n \n 441.2 \n \n \n \n \n Profit for the period \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n 5.6 \n \n \n 5.6 \n \n \n \n \n Other comprehensive (expense)/income: \n \n \n   \n \n \n   \n \n \n   \n \n \n   \n \n \n   \n \n \n   \n \n \n \n \n - actuarial movements on retirement benefit asset (note 12) \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n (15.4) \n \n \n (15.4) \n \n \n \n \n - tax on items taken directly to OCI \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n 3.9 \n \n \n 3.9 \n \n \n \n \n Other comprehensive expense for the period \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n (11.5) \n \n \n (11.5) \n \n \n \n \n Total comprehensive expense for the period \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n (5.9) \n \n \n (5.9) \n \n \n \n \n Share-based payment charge \n \n \n - \n \n \n - \n \n \n - \n \n \n 0.7 \n \n \n - \n \n \n 0.7 \n \n \n \n \n Transfer of share-based payment reserve on vesting of share awards \n \n \n - \n \n \n - \n \n \n - \n \n \n (2.9) \n \n \n 2.9 \n \n \n - \n \n \n \n \n Purchase of shares for share awards \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n (1.3) \n \n \n (1.3) \n \n \n \n \n At 30 June 2025 (unaudited) \n \n \n 53.2 \n \n \n 276.3 \n \n \n 278.2 \n \n \n 8.6 \n \n \n (181.6) \n \n \n 434.7 \n \n \n \n \n   \n   \n   \n The full merger reserve is considered distributable. \n   \n \n \n   \n Consolidated statement of cash flows for the period ended 30 June \n   \n \n \n \n \n \n \n \n \n \n \n Six months ended 30 June \n \n \n \n \n \n \n \n Note \n \n \n 2025 \n unaudited   \n \n \n 2024 \n unaudited   \n \n \n \n \n \n \n \n \n \n \n £m  \n \n \n £m  \n \n \n \n \n Cash flows from operating activities \n \n \n \n \n \n   \n \n \n \n \n \n \n \n Cash (used in)/generated from operations \n \n \n 15 \n \n \n (81.0) \n \n \n 142.4 \n \n \n \n \n Finance costs paid \n \n \n \n \n \n (46.8) \n \n \n (46.5) \n \n \n \n \n Finance income received \n \n \n \n \n \n 22.8 \n \n \n 21.1 \n \n \n \n \n Tax received \n \n \n \n \n \n 0.1 \n \n \n 8.1 \n \n \n \n \n Net cash (used in)/generated from operating activities \n \n \n \n \n \n (104.9) \n \n \n 125.1 \n \n \n \n \n \n \n \n \n \n \n   \n \n \n \n \n \n \n \n Cash flows from investing activities \n \n \n \n \n \n   \n \n \n \n \n \n \n \n Purchase of intangible assets \n \n \n 11 \n \n \n (7.3) \n \n \n (5.7) \n \n \n \n \n Purchase of property, plant and equipment \n \n \n \n \n \n (0.9) \n \n \n (4.5) \n \n \n \n \n Purchase of financial investments \n \n \n \n \n \n (114.8) \n \n \n - \n \n \n \n \n Net cash used in investing activities \n \n \n \n \n \n (123.0) \n \n \n (10.2) \n \n \n \n \n \n \n \n \n \n \n   \n \n \n \n \n \n \n \n Cash flows from financing activities \n \n \n \n \n \n   \n \n \n \n \n \n \n \n Proceeds from bank and other borrowings \n \n \n \n \n \n 35.0 \n \n \n - \n \n \n \n \n Repayment of bank and other borrowings \n \n \n \n \n \n - \n \n \n (75.0) \n \n \n \n \n Payment of lease liabilities \n \n \n \n \n \n (4.2) \n \n \n (7.0) \n \n \n \n \n Dividends paid to Company shareholders \n \n \n \n \n \n - \n \n \n (2.5) \n \n \n \n \n Purchase of own shares for share awards \n \n \n \n \n \n (1.3) \n \n \n (0.1) \n \n \n \n \n Net cash generated from/(used in) financing activities \n \n \n \n \n \n 29.5 \n \n \n (84.6) \n \n \n \n \n \n \n \n \n \n \n   \n \n \n \n \n \n \n \n Net (decrease)/increase in cash, cash equivalents and overdrafts \n \n \n \n \n \n (198.4) \n \n \n 30.3 \n \n \n \n \n Cash, cash equivalents and overdrafts at beginning of period \n \n \n \n \n \n 1,002.8 \n \n \n 741.8 \n \n \n \n \n Cash, cash equivalents and overdrafts at end of year \n \n \n \n \n \n 804.4 \n \n \n 772.1 \n \n \n \n \n \n \n \n \n \n \n   \n \n \n \n \n \n \n \n Cash, cash equivalents and overdrafts at end of period comprise: \n \n \n \n \n \n   \n \n \n \n \n \n \n \n Cash at bank and in hand \n \n \n \n \n \n 805.3 \n \n \n 772.8 \n \n \n \n \n Overdrafts (held in bank and other borrowings) \n \n \n \n \n \n (0.9) \n \n \n (0.7) \n \n \n \n \n Total cash, cash equivalents and overdrafts \n \n \n \n \n \n 804.4 \n \n \n 772.1 \n \n \n \n \n   \n   \n In line with FY24 reporting, cash generated from operations in 1H24 has been represented to include movement in retail deposits which is no longer considered a financing cash flow. \n   \n Cash at bank and in hand includes £758.4m (1H24: £716.6m) in respect of the liquidity buffer, including other liquidity resources, held by Vanquis Bank Limited in accordance with the PRA's liquidity regime. \n   \n Notes to the financial information \n   \n 1.         Basis of preparation \n   \n The company is a public limited company, incorporated and domiciled in the UK. The address of its registered office is No. 1 Godwin Street, Bradford, BD1 2SU. The company is listed on the London Stock Exchange. \n   \n The unaudited condensed interim financial statements do not constitute the statutory financial statements of the Group within the meaning of section 434 of the Companies Act 2006. The statutory financial statements for the year ended 31 December 2024 were approved by the board of directors on 13 March 2025 and have been delivered to the Registrar of Companies. The report of the auditor on those financial statements was unqualified, did not draw attention to any matters by way of emphasis and did not contain any statement under section 498(2) or (3) of the Companies Act 2006. \n   \n The unaudited condensed interim financial statements for the six months ended 30 June 2025 have been reviewed, not audited, and were approved by the board of directors on 6 August 2025. \n   \n The unaudited condensed interim financial statements for the six months ended 30 June 2025 have been prepared in accordance with IAS 34 'Interim Financial Reporting' as adopted by the UK. The unaudited condensed interim financial statements should be read in conjunction with the statutory financial statements for the year ended 31 December 2024. \n   \n The interim financial statements have been prepared on a going concern basis under the historical cost convention, as modified by the revaluation of derivative financial instruments and investments held at fair value through profit and loss. \n   \n In assessing whether the Group is a going concern, the directors' review has been made on the basis that the Group continues to operate for the twelve months from the date of the approval of the financial statements. The directors considered the appropriateness of the going concern basis, the period of assessment, any reporting requirements, and solvency and liquidity risks, and included a variety of factors - forecasts and budgets, timing of cashflows and funding, the Group's primary market and any contingent liabilities. When considering the appropriateness of going concern the directors have also considered the  Group's  ability to meets its regulatory requirements (both capital and liquidity) at all times and not just a positive net asset measure. \n   \n The assessment of going concern for the Group considered the following factors: \n ·      The Group's corporate plan as approved in December 2024, and the latest 18 months forecast approved in July 25 which sets out financial, capital, liquidity and funding projections, together with an overview of relevant risks; \n ·      The principal and emerging risks which could impact the performance of the Group, with a focus on capital and liquidity; \n ·      The severe but plausible downside scenario, which is designed to assess the potential impact of certain underlying risks on the Group's capital and funding resources, together with the availability and effectiveness of mitigating actions; \n ·      An idiosyncratic downside scenario assessing Vehicle Finance Commission outcomes; and \n ·      Reverse stress testing analysis, which is designed to assess the point at which the Group is no longer a going concern; \n   \n Having considered the Group's forecasts, the regulatory capital and liquidity of the Group, the regulatory outlook and the impact of the Supreme Court judgment and FCA's intention to consult on Vehicle Finance commission, the directors have a reasonable expectation that the Group will continue as a going concern for a period of at least 12 months from the date of approving these financial statements. Accordingly, the financial statements of the Group have been prepared on the going concern basis.  \n   \n 2.            Accounting policies \n   \n Group principal accounting policies under IFRS have been consistently applied to all the years presented, except where set out below. \n   \n Change in accounting policies \n Exceptional items \n The Group has transitioned to reporting solely on a statutory basis, removing adjustments for goodwill write-offs, transformation and other exceptional costs, and amortisation of acquisition intangibles. \n   \n This follows actions taken in 2024 that resulted in a cleaner, lower-risk balance sheet and improved transparency at both Group and product levels. Adjusted performance is now expected to closely align with statutory results. \n   \n The accounting policy for exceptional items is therefore no longer in place. As this is a change in accounting policy the comparatives have been represented however there is no impact on recognition, measurement or total profit and loss in any period presented in this report. The change reflects a change in presentation of the income statement and associated metrics. \n   \n Representation of items \n Discontinued operations \n The Group sold its Loan portfolio in MAR25. In accordance with IFRS 5 'Non-current Assets Held for Sale and Discontinued Operations' this business segment is now presented as discontinued operations. See note 5. \n   \n Segmental reporting \n During 1H25, following the sale of the Personal Loans business, the Group now comprises four segments: the three core lending products - Credit Cards, Vehicle Finance, and Second Charge Mortgages - and the Corporate Centre. The Corporate Centre includes the residual performance of the Retail Savings business, Treasury results after product allocations, Snoop, and other immaterial or central items. As a result , all previous periods have been represented onto a consistent basis. These changes do not constitute a change in accounting policy and there is no impact on recognition, measurement or profit and loss in any period presented in this re port. See note 4. \n   \n Fraud costs reclassification \n In FY24 fraud costs were represented from impairment to within operating costs and the comparative numbers for 2023 restated. As part of this change, the reduction in customer receivables for Cards for fraud accounts was represented from allowance account to gross receivables. \n   \n The 1H24 comparatives presented in this report have been retrospectively re-presented. This change does not constitute a change in accounting policy and there is no impact on recognition, measurement or profit and loss in any period presented in this report. The impact of this change in 1H24 was a £3.5m reduction in the total impairment charge and a corresponding increase in costs.   \n   \n There was no impact on net receivables as a result of this change. These changes do not constitute a change in accounting policy and there is no impact on recognition, measurement or profit and loss in any period presented in this repo rt. \n   \n Critical accounting judgements and key sources of estimation uncertainty \n   \n The significant accounting judgements exercised by management and key sources of estimation uncertainty in the \n interim financial statements are consistent with those adopted in the statutory financial statements for the year ended 31 December 2024 with the exception of Goodwill. Due to the impact of any judgement in relation to goodwill no longer being considered material, it is no longer included as a critical accounting judgement. \n   \n Amounts receivable from customers (note 9) \n Critical accounting judgements \n The Group reviews amounts receivable from customers for impairment at each balance sheet date. For the purposes of assessing the impairment, customers are categorised into IFRS 9 stages and cohorts which are considered to be the most reliable indication of future payment performance. \n   \n The determination of expected credit losses involves complex modelling techniques and requires management to apply significant judgements to calculate expected credit losses. The most critical judgements are outlined below. \n   \n The determination of the Significant Increase in Credit Risk (SICR) thresholds to be used in the models for Credit Cards and Vehicle Finance requires management judgement to optimise the performance and therefore effectiveness of the staging methodology. Assessments are made to determine whether there is objective evidence of an SICR which indicates whether there has been an adverse effect on Probability of Default (PD). An SICR for customers is when there has been a significant increase in behavioural score or when one contractual monthly payment has been missed. \n   \n For the purpose of IFRS 9, default is assumed when three contractual repayments have been missed. \n   \n The Group's impairment models are subject to periodic monitoring, independent validation and back testing performed on model components (where appropriate), including PD, EAD, and LGD to ensure management judgements remain appropriate. \n   \n Limitations in the Group's impairment models or data inputs may be identified through the ongoing assessment and validation of the output of the models. In these circumstances, management makes appropriate adjustments to the Group's allowance for impairment losses to ensure that the overall provision adequately reflects all material credit risks. These adjustments are determined by considering the particular attributes of exposures which have not been adequately captured by the impairment models and range from changes to model inputs and parameters, at account level, through to more qualitative post-model overlays. Those changes applied to model inputs and parameters are deemed to be in-model overlays; more qualitative changes that have a higher degree of management judgement are deemed to be post-model overlays. All adjustments are reviewed quarterly and are subject to internal review and challenge to ensure that amounts are appropriately calculated. A breakdown of the in-model and post-model overlays is included within note 9. \n   \n Credit performance across the Group remains stable and internal analysis shows no obvious signs of credit quality deterioration. \n   \n Macroeconomic impairment provision adjustments are recognised in the core model to reflect an increased PD, based on future macroeconomic scenarios. Management judgement was required to determine the appropriate macroeconomic indicators to be used in the model by assessing their correlation with credit losses incurred by the business. \n   \n In FY24 a model overlay of £5.4m was recognised which looked at Credit Card write-off rates, utilising data from a third party. This third party model predicts industry level write-off rates using a combination of interest rates on Credit Cards, unemployment rate, debt to income ratio and a measure of macroeconomic volatility. The outputs from this model are calibrated to the VBG entry to default rate which is in turn used to derive the scalars applied to the lifetime probability of default model. \n   \n During 1H25 the third party model was incorporated in the core model and an overlay is no longer held. The redeveloped internal model is expected to be implemented in 2H25. \n   \n   \n Key sources of estimation uncertainty \n The level of impairment recognised is calculated using models which utilise historical payment performance to generate the estimated amount and timing of future cash flows from each cohort of customers in each arrears stage. \n   \n The models are regularly monitored to ensure they retain sufficient accuracy. Sensitivity analysis has been performed in note 9 which shows the impact of a 1% movement of gross exposure into Stage 2 from Stage 1 on the allowance accounts. \n   \n Macroeconomic assumptions \n The following table shows the scenario five-year peak and average third party model Credit Card write off rates. These estimates are used to derive base case, upside, downside and severe scenarios. \n   \n \n \n \n \n \n \n \n 30 June 2025 \n \n \n 31 December 2024 \n \n \n \n \n \n \n \n Base \n \n \n Upside \n \n \n Downside \n \n \n Severe \n \n \n Base \n \n \n Upside \n \n \n Downside \n \n \n Severe \n \n \n \n \n Weighting \n \n \n 60% \n \n \n 15% \n \n \n 20% \n \n \n 5% \n \n \n 60% \n \n \n 15% \n \n \n 20% \n \n \n 5% \n \n \n \n \n 2025 \n \n \n 0.46% \n \n \n 0.40% \n \n \n 0.51% \n \n \n 0.52% \n \n \n 0.46% \n \n \n 0.44% \n \n \n 0.47% \n \n \n 0.47% \n \n \n \n \n 2026 \n \n \n 0.48% \n \n \n 0.28% \n \n \n 0.64% \n \n \n 0.69% \n \n \n 0.50% \n \n \n 0.36% \n \n \n 0.61% \n \n \n 0.64% \n \n \n \n \n 2027 \n \n \n 0.47% \n \n \n 0.22% \n \n \n 0.74% \n \n \n 0.80% \n \n \n 0.52% \n \n \n 0.27% \n \n \n 0.71% \n \n \n 0.78% \n \n \n \n \n 2028 \n \n \n 0.45% \n \n \n 0.20% \n \n \n 0.76% \n \n \n 0.82% \n \n \n 0.49% \n \n \n 0.22% \n \n \n 0.75% \n \n \n 0.83% \n \n \n \n \n 2029 \n \n \n 0.44% \n \n \n 0.20% \n \n \n 0.74% \n \n \n 0.80% \n \n \n 0.45% \n \n \n 0.20% \n \n \n 0.73% \n \n \n 0.81% \n \n \n \n \n Five year peak \n \n \n 0.48% \n \n \n 0.45% \n \n \n 0.77% \n \n \n 0.83% \n \n \n 0.52% \n \n \n 0.46% \n \n \n 0.76% \n \n \n 0.84% \n \n \n \n \n   \n The unemployment data used in the macroeconomic provisions held at 1H24 were compiled from a consensus of sources \n including the Bank of England, HM Treasury, the Office for Budget Responsibility (OBR), Bloomberg and a number of prime banks. These estimates are used to derive base case, upside, downside and severe scenarios. \n   \n The table below shows the scenario five-year peak and average unemployment assumptions adopted and the weightings applied to each \n   \n \n \n \n \n \n \n \n 30 June 2024 \n \n \n \n \n \n \n \n Base \n \n \n Upside \n \n \n Downside \n \n \n Severe \n \n \n \n \n Weighting \n \n \n 60% \n \n \n 15% \n \n \n 20% \n \n \n 5% \n \n \n \n \n 2024 \n \n \n 4.4% \n \n \n 4.3% \n \n \n 4.5% \n \n \n 4.8% \n \n \n \n \n 2025 \n \n \n 4.5% \n \n \n 3.9% \n \n \n 5.8% \n \n \n 7.2% \n \n \n \n \n 2026 \n \n \n 4.5% \n \n \n 4.1% \n \n \n 6.3% \n \n \n 8.0% \n \n \n \n \n 2027 \n \n \n 4.5% \n \n \n 4.1% \n \n \n 5.5% \n \n \n 6.4% \n \n \n \n \n 2028 \n \n \n 4.5% \n \n \n 4.3% \n \n \n 5.0% \n \n \n 5.6% \n \n \n \n \n Five year peak \n \n \n 4.5% \n \n \n 4.4% \n \n \n 6.5% \n \n \n 8.3% \n \n \n \n \n   \n   \n There has been no change in the weightings from 2024. \n   \n Contingent liability: Vehicle Finance Commission (note 16) \n Critical accounting judgement \n Management has considered the requirements of IAS 37 to determine if a provision or contingent liability is required in relation to the outcome of the Supreme Court judgment regarding motor finance commission disclosure practices. It has also considered the FCA's intention to consult on a motor finance compensation scheme. The Group believes its position is differentiated on a number of grounds and in accordance with IAS 37, the Group has not provided for this matter but has disclosed a contingent liability (see note 16). \n   \n Other accounting judgements: \n Intangibles (note 11) \n All intangible assets have been reviewed for impairment under IAS 36. \n   \n Following the sale of the Personal Loans business in 1H25, the assets associated with that product were reviewed for impairment and subsequently written off. A charge of £1.2m has therefore been recognised within discontinued operations. \n   \n In 1H24 the Credit Cards mobile app was written off in full following a decision to rebuild this functionality using a more efficient design and build approach leading to an overall better customer experience. The resulted in a cost of £8.5m being recognised in 1H24 results. \n   \n In addition, assets expected to be replaced by the Gateway platform in 2026 were reviewed: a small number \n of these assets were written off, and the useful economic lives of other assets were reassessed in light of their expected retirement by the Gateway platform. The impact of these in FY24 results was not material. \n   \n Provisions: Customer remediation complaints (note 14) \n Over the past two years Group has experienced elevated levels of customer compensation claims from claims management companies. The majority of these cl...

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