Quarterly report [Sections 13 or 15(d)]

LOANS ISSUED

v3.25.4
LOANS ISSUED
 9 Months Ended
Dec. 31, 2025
Loans and Leases Receivable Disclosure [Abstract]  
LOANS ISSUED LOANS ISSUED
Loans issued as of December 31, 2025, consisted of the following:
Amount Outstanding Due Dates Average Interest Rate Fair Value of
Collateral		 Loan Currency
 
Mortgage loans $ 1,077,676   January 2026 - May 2051 12.1% $ 1,077,566   KZT / TJS
Corporate loans 350,699   January 2026 - September 2035 17.1% 262,129   KZT / TJS
Purchased retail loans
 204,810   January 2026 - May 2031 31.9% —   KZT
Loans to SME 202,169   January 2026 - November 2032 29.6% 29,434   KZT
Car loans 151,418   January 2026 - December 2032 24.4% 149,014   KZT
Retail loans 43,306   January 2026 - July 2045 40.5% 1,710 
 KZT
Other 25,133   January 2026 - May 2030
18.0%/3.0%/4.0%
 17 
 KZT / USD / EUR
Allowance for loans issued (72,668)
Total loans issued $ 1,982,543 
The Group provides mortgage loans to borrowers on behalf of the JSC Kazakhstan Sustainability Fund ("Program Operator") related to the state mortgage program "7-20-25" and transfers the rights of claim on the mortgage loans to the Program Operator. The proceeds received from these transfers are presented within funds received under state program for financing of mortgage loans in the Condensed Consolidated Statements of Cash Flows. Under this program, borrowers can receive a mortgage at an interest rate of 7% subject to not less than 20% down payment, for 25 years, and the interest payments received by the Group are recognized as interest income in the Group's Condensed Consolidated Statements of Operations and Statements of Other Comprehensive Income. In accordance with the program and trust management agreement for the program, Group services the transferred loans and remits all repayments of principal it receives plus 4.5% of the 7% interest received to the Program Operator. The interest paid to the Program Operator is recognized as interest expense in the Condensed Consolidated Statements of Operations and Statements of Other Comprehensive Income. The remaining 2.5% of the 7% interest is retained by Group. Under the program and trust management agreement, Group is required to repurchase the rights to make claims on the transferred loans when either loan principal repayments or interest payments are overdue 90 days or more. The repurchase of overdue loans is performed at the loans' nominal value and is presented within repurchase of mortgage loans under the State Program in the Condensed Consolidated Statements of Cash Flows.

Since the Group transfers the rights to make claims on the loans with recourse for loans that are more than 90 days past due, retains part of the interest received on the loans and agrees to service the loans after the sale of the loans to the Program Operator, the Group has determined that it retains control over the loans transferred and continues recognizing the loans, which are accounted for as secured borrowings of the Group in accordance with ASC 860, Transfers and Servicing. As the Group continues to recognize the loans as assets, it also recognizes the associated liability equal to the proceeds received from the Program Operator, which is presented separately as liability arising from continuing involvement in the Consolidated Balance Sheets. This liability accrues 5% interest annually as described above. As of December 31, 2025 and March 31, 2025, the corresponding liability amounted to $520,397 and $503,705, respectively.
As of December 31, 2025 and March 31, 2025, mortgage loans include loans under the state mortgage program "7-20-25" with an aggregate principal amount of $529,205 and $511,851, respectively, were presented within loans issued in the Condensed Consolidated Balance Sheets.

The Group historically entered into agreement with Microfinance Organization Freedom Finance Credit LLP ("FFIN Credit"), a company established and controlled by FRHC's controlling shareholder, chairman and chief executive officer, Timur Turlov, to purchase uncollateralized retail loans. FFIN Credit is a non-bank credit institution that issues loans in Kazakhstan under simplified lending procedures. FFIN Credit was created as a pilot project to test and improve the scoring models used for qualifying and issuing loans. The principal operation of FFIN Credit is to provide loans to customers online using biometric identification and its proprietary scoring process. Following the successful pilot, the Company considered either acquire FFIN Credit from Mr. Turlov or implement an in-house solution to replicate its functions, ensuring continuity and scalability of the lending operations.

Although the Group obtained legal title to uncollateralized retail loans purchased from FFIN Credit, the Group did not recognize such loans in its consolidated financial statements under U.S. GAAP, as the transactions did not qualify for sale accounting due to contractual provisions under which FFIN Credit retained the credit risk. Accordingly, the Group accounted for these arrangements as financing transactions similar to secured borrowing-type arrangement, recognizing loans receivable from FFIN Credit within loans issued on the Condensed Consolidated Balance Sheets, while the underlying customer loans were treated as collateral.

Beginning in September 2025, the Company begun originating these loans through its banking subsidiary and discontinued the purchase of unsecured consumer loans from FFIN Credit.

During the three months ended December 31, 2025, FFIN Credit and the Group agreed that FFIN Credit would make a compensation payment to the Group of approximately $23 million ($20 million discounted), payable over a period of up to two years. In exchange, the Company agreed to release FFIN Credit from the contractual provisions that provided credit protection to the Company covering a total of $215 million of outstanding loans at December 31, 2025. As a result of these modifications, the Group determined that it should recognize the loans previously purchased from FFIN Credit as of December 31, 2025 in the amount of $186 million.
The total accrued interest for loans issued amounted to $16,928 as of December 31, 2025 and $13,385 as of March 31, 2025.

Loans issued as of March 31, 2025, consisted of the following:
Amount Outstanding Due Dates Average Interest Rate Fair Value of
Collateral		 Loan Currency
 
Mortgage loans $ 924,530  April 2025 - March 2050 11.4% $ 924,386  KZT
Loans to SME 244,217 
April 2025 - February 2032
 28.6% 35,141  KZT
Right of claim for purchased retail loans 183,635  April 2025 - March 2030 15.0% 183,635  KZT
Car loans 156,340  April 2025 - April 2032 24.2% 155,320  KZT
Corporate loans 149,143 
April 2025 - December 2031
 19.1% 92,739  KZT
Retail loans 4,847  September 2025 - March 2045 21.2% 663  KZT
Other 7,838  April 2025 - September 2029
18.0%/12.70%/3.00%
 29 
KZT/EUR/USD
Allowance for loans issued (75,115)
Total loans issued $ 1,595,435 
Credit quality indicators

Freedom Bank KZ uses a loan portfolio quality classification system that indicates signs of a significant increase in credit risk and contractual impairment, depending on the analysis of reasonable and supportable information available at the reporting date. The loan portfolio is classified into "not credit impaired," "with significant increase in credit risk" and "credit impaired" agreements.

Loans "not credit impaired" under the agreement are serviced as usual, there are no primary signs of an increase in credit risk. Agreements classified as "with significant increase in credit risk" represent loans for which there is an increase in the credit risk expected over the life of the agreement compared to the initial risk at the date of recognition of the loan. In practice, the presence of overdue debt on principal and interest for a period of more than 30 days or the absolute probability of default threshold PD exceeds 20%. Agreements classified as "credit impaired" represent loans for which at the reporting date there are signs of impairment, the borrower has been in default for 90 or more days for individuals and 60 or more days for legal entities, the borrower for the last 6 months for individuals and 12 months for legal entities restructured the contract due to the deterioration of the financial condition, the borrower is recognized as credit impaired, the presence of a sign of default, a sign of bankruptcy, the deterioration of the financial performance of the borrower, the presence of other information indicating the presence of a high credit risk.
The table below presents the Group's loan portfolio by credit quality classification and origination year as of December 31, 2025. Current vintage disclosure is the requirement due to first adoption of ASC 326.
Term Loans by Origination Fiscal Year
2026 2025 2024 2023 2022 Prior Revolving loans Total
Mortgage loans $ 243,933  $ 300,200  $ 166,529  $ 340,482  $ 26,532  $ —  $ —  $ 1,077,676 
that are not credit impaired 243,030  297,181  163,939  337,748  26,148  —  —  1,068,046 
with significant increase in credit risk 779  1,627  1,388  1,514  259  —  —  5,567 
that are credit impaired 124  1,392  1,202  1,220  125  —  —  4,063 
Loans to SME 47,339  64,965  78,212  11,653  —  —  —  202,169 
that are not credit impaired 45,294  60,412  68,030  9,702  —  —  —  183,438 
with significant increase in credit risk 1,120  1,733  2,844  513  —  —  —  6,210 
that are credit impaired 925  2,820  7,338  1,438  —  —  —  12,521 
Purchased retail loans
 204,810  —  —  —  —  —  —  204,810 
that are not credit impaired 204,810  —  —  —  —  —  —  204,810 
Corporate loans 296,137  54,465  97  —  —  —  —  350,699 
that are not credit impaired 295,453  53,984  —  97  —  —  —  —  349,534 
with significant increase in credit risk 371  118  —  —  —  —  —  489 
that are credit impaired 313  363  —  —  —  —  —  676 
Car loans 42,390  4,310  82,275  22,443  —  —  —  151,418 
that are not credit impaired 42,085  4,239  76,225  15,395  —  —  —  137,944 
with significant increase in credit risk 208  28  1,040  472  —  —  —  1,748 
that are credit impaired 97  43  5,010  6,576  —  —  —  11,726 
Retail loans 39,483  2,963  800  60  —  —  —  43,306 
that are not credit impaired 39,131  2,608  588  58  —  —  —  42,385 
with significant increase in credit risk 147  94  27  —  —  —  —  268 
that are credit impaired 205  261  185  2  —  —  —  653 
Other 17,197  263  1,229  6,414  30  —  —  25,133 
that are not credit impaired 17,197  263  1,222  6,414  30  —  —  25,126 
with significant increase in credit risk —  —  —  —  —  —  —  — 
that are credit impaired —  —  7  —  —  —  —  7 
Total $ 891,289  $ 427,166  $ 329,142  $ 381,052  $ 26,562  $ —  $ —  $ 2,055,211 
The table below presents the Group's loan portfolio by credit quality classification as of March 31, 2025.
Term Loans by Origination Fiscal Year
2025 2024 2023 2022 2021 Prior Revolving loans Total
Mortgage loans $ 336,535  $ 186,816  $ 370,588  $ 30,591  $ —  $ —  $ —  $ 924,530 
that are not credit impaired 336,051  184,610  367,918  29,876  —  —  —  918,455 
with significant increase in credit risk 410  1,361  1,402  340  —  —  —  3,513 
that are credit impaired 74  845  1,268  375  —  —  —  2,562 
Loans to SME 98,556  126,835  18,826  —  —  —  —  244,217 
that are not credit impaired 96,338  109,461  15,647  —  —  —  —  221,446 
with significant increase in credit risk 1,185  3,612  663  —  —  —  —  5,460 
that are credit impaired 1,033  13,762  2,516  —  —  —  —  17,311 
Right of claim for purchased retail loans 151,237  30,702  1,688  8  —  —  —  183,635 
that are not credit impaired 151,237  30,702  1,688  8  —  —  —  183,635 
with significant increase in credit risk —  —  —  —  —  —  —  — 
that are credit impaired —  —  —  —  —  —  —  — 
Car loans 5,974  116,459  33,907  —  —  —  —  156,340 
that are not credit impaired 5,974  110,871  26,014  —  —  —  —  142,859 
with significant increase in credit risk —  1,603  837  —  —  —  —  2,440 
that are credit impaired —  3,985  7,056  —  —  —  —  11,041 
Corporate loans 148,599  470  74  —  —  —  —  149,143 
that are not credit impaired 146,785  470  74  —  —  —  —  147,329 
with significant increase in credit risk 1,813  —  —  —  —  —  —  1,813 
that are credit impaired 1  —  —  —  —  —  —  1 
Retail loans 3,774  1,066  7  —  —  —  —  4,847 
that are not credit impaired 3,682  887  5  —  —  —  —  4,574 
with significant increase in credit risk 34  18  —  —  —  —  —  52 
that are credit impaired 58  161  2  —  —  —  —  221 
Other 232  1,237  6,323  46  —  —  —  7,838 
that are not credit impaired 232  1,229  6,323  46  —  —  —  7,830 
with significant increase in credit risk —  —  —  —  —  —  —  — 
that are credit impaired —  8  —  —  —  —  —  8 
Total $ 744,907  $ 463,585  $ 431,413  $ 30,645  $ —  $ —  $ —  $ 1,670,550 
Aging analysis of past due loans as of December 31, 2025 and March 31, 2025, is as follows:
December 31, 2025
Loans 30-59 Days past due Loans 60-89 days past due Loans 90 days or more past due and still accruing Current loans Total
Mortgage loans $ 4,011  $ 1,556  $ 4,063  $ 1,068,046  $ 1,077,676 
Corporate loans 84  405  676  349,534  350,699 
Purchased retail loans
 —  —  —  204,810  204,810 
Loans to SME 3,505  2,705  12,521  183,438  202,169 
Car loans 1,102  646  11,726  137,944  151,418 
Retail loans 163  105  653  42,385  43,306 
Other —  —  7  25,126  25,133 
Total $ 8,865  $ 5,417  $ 29,646  $ 2,011,283  $ 2,055,211 
March 31, 2025
Loans 30-59 Days past due Loans 60-89 days past due Loans 90 days or more past due and still accruing Current loans Total
Mortgage loans $ 2,835  $ 678  $ 2,562  $ 918,455  $ 924,530 
Loans to SME 3,325  2,135  17,311  221,446  244,217 
Right of claim for purchased retail loans —  —  —  183,635  183,635 
Car loans 1,548  892  11,041  142,859  156,340 
Corporate loans 730  1,083  1  147,329  149,143 
Retail loans 36  16  221  4,574  4,847 
Other —  —  8  7,830  7,838 
Total $ 8,474  $ 4,804  $ 31,144  $ 1,626,128  $ 1,670,550 
The activity in the allowance for credit losses for the nine months ended December 31, 2025 and 2024 is summarized in the following tables.
Allowance for credit losses
Mortgage loan Loans to SME Corporate loans Retail loans Car loans
Purchased retail loans
 Other Total
March 31, 2025
 (10,698) (35,194) (2,640) (760) (8,466) (17,332) (25) $ (75,115)
Charges (3,147) (22,463) (3,576) (5,186) (3,828) (24,030) (51) (62,281)
Recoveries 10,611  11,811  3,189  498  2,782  20,301  —  49,192 
Write off 3  14,244  —  —  147  —  —  14,394 
Modification —  —  —  —  —  893  —  893 
Forex 311  214  (9) (179) (16) (72) —  249 
December 31, 2025
 $ (2,920) $ (31,388) $ (3,036) $ (5,627) $ (9,381) $ (20,240) $ (76) $ (72,668)
Allowance for credit losses
Mortgage loan Loans to SME Corporate loans Retail loans Car loans Right of claim for purchased retail loans Other Total
March 31, 2024 (3,033) (19,558) (10) (150) (14,262) (6,577) (31) $ (43,621)
Charges (6,258) (30,223) (3,228) (422) (4,086) (9,335) (22) (53,574)
Recoveries 1,089  5,436  45  64  5,506  5,216  —  17,356 
Write off —  13,621  —  4  2,713  —  32  16,370 
Other —  —  —  —  —  —  —  — 
Forex 560  3,969  301  56  1,927  59  —  6,872 
December 31, 2024 $ (7,642) $ (26,755) $ (2,892) $ (448) $ (8,202) $ (10,637) $ (21) $ (56,597)