Quarterly report [Sections 13 or 15(d)]

LOANS ISSUED

v3.26.1
LOANS ISSUED
 3 Months Ended
Jun. 30, 2026
Loans and Leases Receivable Disclosure [Abstract]  
LOANS ISSUED LOANS ISSUED
Loans issued as of June 30, 2026, consisted of the following:
Amount Outstanding Due Dates Average Interest Rate Fair Value of
Collateral		 Loan Currency
Mortgage loans $ 1,142,148   July 2026 - June 2051 12.1% $ 1,141,471   KZT/TJS
Corporate loans 354,243   July 2026 - December 2040 17.2% 287,054   KZT
Loans to SME 179,612   July 2026 - June 2033 29.4% 26,610   KZT
Car loans 162,438   July 2026 - August 2033 26.0% 159,015   KZT
Purchased retail loans 155,553   July 2026 - June 2031 22.7% —   KZT
Retail loans 118,745   July 2026 - July 2045 41.9% 6,982 
 KZT
Other 38,066   July 2026 - May 2033
19.4%5.0%5.2%
 36 
 KZT/EUR/USD
Allowance for loans issued (114,290)
Total loans issued $ 2,036,515 
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 4.5% interest annually as described above. As of June 30, 2026 and March 31, 2026, the corresponding liability amounted to $561,891 and $554,594, respectively.
As of June 30, 2026 and March 31, 2026, mortgage loans include loans under the state mortgage program "7-20-25" with an aggregate principal amount of $573,114 and $568,065, 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 began originating these loans through its banking subsidiary and has significantly reduced purchase volumes of unsecured consumer loans from FFIN Credit.

During the year ended March 31, 2026, 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 $23,191 as of June 30, 2026 and $20,133 as of March 31, 2026.

Loans issued as of March 31, 2026, consisted of the following:
Amount Outstanding Due Dates Average Interest Rate Fair Value of
Collateral		 Loan Currency
Mortgage loans $ 1,149,000  April 2026 - May 2051 12.2% $ 1,148,860  KZT/TJS
Corporate loans 351,713  April 2026 - December 2040 18.0% 239,226  KZT
Loans to SME 195,495  April 2026 - November 2032 29.7% 28,141  KZT
Purchased retail loans 182,130  April 2026 - May 2031 22.6% —  KZT
Car loans 167,805  April 2026 - March 2033 25.4% 164,930  KZT
Retail loans 100,927  April 2026 - July 2045 42.0% 5,240  KZT
Other 32,335  April 2026 - May 2030
19.0%/5.20%/5.00%
 26 
KZT/EUR/USD
Allowance for loans issued (101,799)
Total loans issued $ 2,077,606 
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. 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 12 months 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 June 30, 2026.
Term Loans by Origination Fiscal Year
2027 2026 2025 2024 2023 Prior Revolving loans Total
Mortgage loans $ 29,805  $ 283,775  $ 295,519  $ 165,277  $ 342,085  $ 25,687  $ —  $ 1,142,148 
that are not credit impaired 29,805  281,193  290,095  161,684  338,504  25,267  —  1,126,548 
with significant increase in credit risk —  2,201  3,320  2,446  1,892  204  —  10,063 
that are credit impaired —  381  2,104  1,147  1,689  216  —  5,537 
Loans to SME 6,072  47,933  52,427  63,727  9,453  —  —  179,612 
that are not credit impaired 6,072  43,139  45,315  50,035  7,135  —  —  151,696 
with significant increase in credit risk —  1,228  1,471  2,702  313  —  —  5,714 
that are credit impaired —  3,566  5,641  10,990  2,005  —  —  22,202 
Purchased retail loans
 4,542  151,011  —  —  —  —  —  155,553 
that are not credit impaired 4,526  124,185  —  —  —  —  —  128,711 
with significant increase in credit risk 16  6,173  —  —  —  —  —  6,189 
that are credit impaired —  20,653  —  —  —  —  —  20,653 
Corporate loans 73,934  241,457  38,764  88  —  —  —  354,243 
that are not credit impaired 73,934  238,515  38,194  88  —  —  —  350,731 
with significant increase in credit risk —  1,445  19  —  —  —  —  1,464 
that are credit impaired —  1,497  551  —  —  —  —  2,048 
Car loans 9,556  59,951  3,824  70,114  18,993  —  —  162,438 
that are not credit impaired 9,556  58,424  3,696  63,672  11,638  —  —  146,986 
with significant increase in credit risk —  924  23  944  395  —  —  2,286 
that are credit impaired —  603  105  5,498  6,960  —  —  13,166 
Retail loans 34,105  81,335  2,635  615  55  —  —  118,745 
that are not credit impaired 34,105  76,925  2,164  382  53  —  —  113,629 
with significant increase in credit risk —  2,220  59  6  —  —  —  2,285 
that are credit impaired —  2,190  412  227  2  —  —  2,831 
Other 4,951  25,179  255  1,202  6,462  17  —  38,066 
that are not credit impaired 4,951  25,179  255  1,195  6,462  17  —  38,059 
with significant increase in credit risk —  —  —  —  —  —  —  — 
that are credit impaired —  —  —  7  —  —  —  7 
Total $ 162,965  $ 890,641  $ 393,424  $ 301,023  $ 377,048  $ 25,704  $ —  $ 2,150,805 
The table below presents the Group's loan portfolio by credit quality classification as of March 31, 2026.
Term Loans by Origination Fiscal Year
2026 2025 2024 2023 2022 Prior Revolving loans Total
Mortgage loans $ 291,663  $ 307,056  $ 171,398  $ 352,105  $ 26,778  $ —  $ —  $ 1,149,000 
that are not credit impaired 290,224  302,323  168,147  348,614  26,374  —  —  1,135,682 
with significant increase in credit risk 1,245  2,710  1,860  1,875  243  —  —  7,933 
that are credit impaired 194  2,023  1,391  1,616  161  —  —  5,385 
Loans to SME 52,758  59,627  72,382  10,728  —  —  —  195,495 
that are not credit impaired 49,372  53,303  60,112  8,363  —  —  —  171,150 
with significant increase in credit risk 1,392  2,258  3,192  506  —  —  —  7,348 
that are credit impaired 1,994  4,066  9,078  1,859  —  —  —  16,997 
Purchased retail loans 115,550  57,578  8,734  268  —  —  —  182,130 
that are not credit impaired 105,399  49,929  7,431  223  —  —  —  162,982 
with significant increase in credit risk 4,771  3,014  514  14  —  —  —  8,313 
that are credit impaired 5,380  4,635  789  31  —  —  —  10,835 
Car loans 64,088  4,164  78,497  21,056  —  —  —  167,805 
that are not credit impaired 63,205  4,041  71,901  13,687  —  —  —  152,834 
with significant increase in credit risk 542  27  1,080  404  —  —  —  2,053 
that are credit impaired 341  96  5,516  6,965  —  —  —  12,918 
Corporate loans 310,024  41,594  95  —  —  —  —  351,713 
that are not credit impaired 308,278  41,050  95  —  —  —  —  349,423 
with significant increase in credit risk 647  —  —  —  —  —  —  647 
that are credit impaired 1,099  544  —  —  —  —  —  1,643 
Retail loans 97,334  2,853  708  32  —  —  —  100,927 
that are not credit impaired 95,717  2,409  470  30  —  —  —  98,626 
with significant increase in credit risk 1,064  93  20  —  —  —  —  1,177 
that are credit impaired 553  351  218  2  —  —  —  1,124 
Other 24,403  258  1,214  6,437  23  —  —  32,335 
that are not credit impaired 24,403  258  1,207  6,437  23  —  —  32,328 
with significant increase in credit risk —  —  —  —  —  —  —  — 
that are credit impaired —  —  7  —  —  —  —  7 
Total $ 955,820  $ 473,130  $ 333,028  $ 390,626  $ 26,801  $ —  $ —  $ 2,179,405 
    
Aging analysis of past due loans as of June 30, 2026 and March 31, 2026, is as follows:
June 30, 2026
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 $ 6,699  $ 3,364  $ 5,537  $ 1,126,548  $ 1,142,148 
Corporate loans 532  932  2,048  350,731  354,243 
Purchased retail loans
 3,218  2,971  20,653  128,711  155,553 
Loans to SME 2,823  2,891  22,202  151,696  179,612 
Car loans 1,450  836  13,166  146,986  162,438 
Retail loans 1,275  1,010  2,831  113,629  118,745 
Other —  —  7  38,059  38,066 
Total $ 15,997  $ 12,004  $ 66,444  $ 2,056,360  $ 2,150,805 
March 31, 2026
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 $ 5,781  $ 2,152  $ 5,385  $ 1,135,682  $ 1,149,000 
Corporate loans 468  179  1,643  349,423  351,713 
Loans to SME 3,980  3,368  16,997  171,150  195,495 
Purchased retail loans 4,348  3,965  10,835  162,982  182,130 
Car loans 1,423  630  12,918  152,834  167,805 
Retail loans 701  476  1,124  98,626  100,927 
Other —  —  7  32,328  32,335 
Total $ 16,701  $ 10,770  $ 48,909  $ 2,103,025  $ 2,179,405 
The activity in the allowance for credit losses for the three months ended June 30, 2026 and 2025 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, 2026
 (7,388) (38,752) (5,547) (6,573) (13,836) (29,628) (75) $ (101,799)
Charges (1,233) (7,440) (1,569) (4,442) (1,504) (8,127) —  (24,315)
Reversal 1,381  2,956  1,417  737  1,286  3,408  3  11,188 
Write off —  71  1  —  6  —  —  78 
Forex 28  206  24  69  58  173  —  558 
June 30, 2026
 $ (7,212) $ (42,959) $ (5,674) $ (10,209) $ (13,990) $ (34,174) $ (72) $ (114,290)
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, 2025 (10,699) (35,192) (2,640) (761) (8,465) (17,333) (25) $ (75,115)
Charges (2,027) (9,498) (1,122) (430) (1,055) (8,239) (2,925) (25,296)
Reversal 3,571  3,186  2,013  148  1,145  6,892  —  16,955 
Write off 3  —  —  —  —  —  24  27 
Forex 296  1,093  68  27  247  525  —  2,256 
June 30, 2025 $ (8,856) $ (40,411) $ (1,681) $ (1,016) $ (8,128) $ (18,155) $ (2,926) $ (81,173)