Chief Executive Officer's Review
The foundations for sustainable, profitable growth
2025 marked a significant milestone for Vanquis. The Group returned to statutory profitability and we demonstrated that our transformation is delivering results, with strong but disciplined growth in interest-earning balances, strong and resilient credit quality, continued progress on Gateway and tight cost control. Most importantly we continued improving our customer experience.
This performance reflects the disciplined execution of our strategy to build a scalable, digital-first and customer-focused bank. With strong foundations now in place, we are focused on sustained, profitable growth that creates long-term value for customers, colleagues and shareholders.
Customer proposition
In 2025, we strengthened and diversified our customer proposition, reflecting our commitment to help customers borrow responsibly, manage money confidently and build financial resilience. This sits at the heart of our ‘Serve Responsibly’ pillar, ensuring access to credit is balanced with strong affordability, good customer outcomes and long-term portfolio quality, while enabling us to ‘Serve More’ customers who are underserved elsewhere.
We continued to help customers build a healthier relationship with credit. Credit Card balances grew 19% to £1,518 million, supported by new product launches, higher utilisation from existing customers and strong retention. This growth was achieved within risk appetite, underpinned by enhanced affordability assessments, resilient margins and consistently strong credit performance. Vanquis was recognised at the 2025 Moneyfacts Consumer Awards as Credit Builder Card Provider of the Year and Credit Card App of the Year, reflecting the trust customers place in our propositions and brand.
In Vehicle Finance we reduced balances in line with our plan ahead of the launch of our new onboarding and servicing platform as part of the Gateway transformation in 2026. This deliberate moderation reflects a disciplined approach to growth as we prepare to scale on a modernised platform. Many of our Vehicle Finance customers come to us for access to a reliable vehicle when it matters most, and we continue to enhance our credit decisioning capabilities to improve the speed, accuracy and consistency of lending decisions while lending responsibly.
Our Second Charge Mortgages proposition, which our customers mainly use for debt consolidation, continued to perform strongly. Balances increased to £599 million (December 2024: £217 million), supported by long-term origination partnerships that deliver high-quality, predictable growth and attractive risk-adjusted returns.
Retail deposits remain the cornerstone of our funding strategy. During the year we broadened our Savings product suite with the addition of ISAs and the Snoop-branded Easy Access account, further strengthening our stable and cost-efficient funding base. Vanquis was recognised at the 2025 Moneyfacts Awards as Best Notice Savings Account Provider and received Highly Commended in the Best Monthly Savings Account and Best Bank Savings Provider categories, underlining the strength of our proposition.
Snoop continues to play a vital role in our customer ecosystem, with active users rising 12% to 328k, including 43k Vanquis customers. The platform deepens engagement, supports financial wellbeing and serves as an efficient acquisition channel. During the year, Snoop introduced Variable Recurring Payments to make saving simpler and more flexible and was recognised for Best Innovation in Product at The Financial Services Forum Awards and Finalist for Best Use of Technology in Personal Finance at the Moneyfacts Awards.
Financial Inclusion
At Vanquis, financial inclusion and opportunity go hand in hand. Our partnership with Fair Finance, part of our ‘not yet’ approach to credit, helps customers who are not currently eligible for our products access affordable loans and unclaimed benefits. Together, we have supported more than 20k people to identify £34m in entitlements and access £307k in loans.
Ahead of the Government’s Financial Inclusion Strategy announced in November, we launched the Vanquis Benefits Checker, a digital tool that helps customers find unclaimed benefits and social tariffs. By helping customers maximise income before borrowing, these initiatives strengthen financial resilience and reduce reliance on credit, reinforcing our commitment to responsible inclusion.
Customer feedback
Customer feedback is the clearest reflection of our purpose: “delivering caring banking”. Across Vanquis, Moneybarn and Snoop, thousands of customer reviews highlight how we help people rebuild credit and access fair, affordable finance when it matters most. In 2025, we introduced a new relationship customer satisfaction (CSAT) measure, giving us a consistent, data-driven view of customer experience and enabling us to track progress as we evolve our products and services. Our satisfaction score, measured by the Institute of Customer Service, stands at 83.7, ahead of the industry average of 81.1. We will continue to build on this validation and strive to deliver even better outcomes for our customers.
Financial performance
Gross customer interest-earning balances increased 22% to £2,824m, ahead of our guidance, reflecting disciplined lending with strong credit quality. Risk-adjusted income rose 5% to £273.8m, supported by a lower cost of risk of 7.3% (FY24: 8.4%). The cost-to-income ratio improved to 58.4% (FY24: 89.4%) through transformation savings, efficiency gains, reduced complaint costs and the non-repeat of prior year notable items. As a result, the Group delivered a statutory profit before tax from continuing operations of £8.3m (FY24: loss of £138.0m) and achieved a statutory return on tangible equity of 2.3% (FY24: (32.1)%).
Technology, operational efficiency and risk management
Technology and data remain central to our strategy. During 2025, we made significant progress on the Gateway transformation, selecting Fiserv’s Vision Next platform to support a scalable, cloud-based infrastructure. Our partnership with Zoot was recognised with the Best Technology Partnership Award, reflecting the impact of advanced decisioning on speed, accuracy and customer outcomes.
Building on the risk management enhancements made in 2024, we further strengthened data and analytics capabilities, enhancing portfolio monitoring, credit modelling and affordability assessments. These improvements are supporting better decision-making, tighter risk control and responsible growth at scale. Gateway is a core enabler of this, providing the modern operating platform required to deliver productivity, efficiency and capital accretion over time.
During the year, over 30 billion rows of customer, product and decisioning data were migrated to a new IT platform as part of Gateway, enabling improved analytics, automation and personalisation across customer journeys.
Across operations, digital and AI-led improvements in fraud prevention, debt sales and complaints handling delivered measurable efficiency gains and better outcomes for customers. Combined with a leaner property footprint, these initiatives contributed to £28.8m in transformation savings during the year.
Vanquis: The bank that’s got your back
In June, we launched our refreshed brand identity, Vanquis: The bank that’s got your back. Developed in-house and successfully tested with customers, it brings our purpose to life and reflects our commitment to caring banking and the financially underserved. Together with our technology transformation, it positions Vanquis as a modern, customer-led specialist bank serving the heart of working Britain.
Complaints and regulatory update
We welcomed the Financial Ombudsman Service’s introduction of a case-fee structure for claims management companies (CMCs). The reform has had a clear and positive impact, reducing the volume of unmerited complaints, indicating that the reform is working as intended.
We engaged constructively with the FCA’s consultation on motor finance redress (CP25/27), helping to shape a fair and proportionate approach that reflects the low risk of detriment in our portfolio. While the final scope of the scheme remains subject to change, we remain comfortable with our £3.0m provision in relation to this matter.
Our people and culture
As Peter notes, we have made good progress with culture, and our achievements in 2025 were made possible by the professionalism and efforts of colleagues across the Group. Our ACT Culture (Ambitious, Caring and Together) and Values are now shaping how we work and reinforcing the execution discipline required to deliver a modern, customer-led bank.
Our progress is underscored by us achieving Great Place to Work® certification in 2025, reflecting the commitment we made last year to strengthen culture across the Group. We were also recognised by the Financial Times as one of the UK’s Best Employers, demonstrating deeper engagement and alignment with our purpose.
As we move into the next phase of our strategy, we will continue to embed our values deeply, ensuring they guide decisions and drive sustainable growth.
Advancing our strategic priorities
In 2026, we will complete the Gateway transformation and re-platform the business onto a modern, cloud-based architecture. This will enable a digital-first operating model, accelerate innovation and deliver a structurally lower cost base.
We will broaden our offering across lending, money management and savings, creating a more integrated digital customer experience. This will include new flexible credit solutions, tailored propositions for different customer segments and deeper personalisation.
We will further enhance credit decisioning through improved data, analytics and automation, strengthening our ability to lend responsibly while improving outcomes for customers. Gateway will provide real-time insights and more accurate affordability assessments across all products, including a transformed Vehicle Finance proposition launching in 2026. In addition, we are introducing Agentic AI capabilities to deliver faster, more efficient support, enhancing service while reducing cost-to-serve.
Together, these initiatives will support growth, improve retention and drive stronger risk-adjusted returns across the business.
Summary and outlook
Disciplined delivery of our strategy in 2025 enabled us to deploy available capital to deliver accelerated balance growth while returning to statutory profitability. We strengthened the balance sheet, improved credit quality and made significant progress in our transformation, laying the foundations for long-term scalability and efficiency.
We enter 2026 with greater momentum, a more predictable performance profile and a clear pathway to higher returns as recent balance growth seasons and translates into improved profitability. Our focus remains on completing the Gateway transformation, maintaining strong credit discipline, deploying capital effectively and improving operational efficiency.
We remain on track to deliver a double-digit return on tangible equity in 2026, and mid-teens return in 2027. While encouraged by our progress, we recognise there is still more to do. We will continue to invest in our capabilities, drive continuous improvement and remain mindful of the responsibility we hold to customers, colleagues and shareholders.
I would like to thank our shareholders for their trust and our colleagues across the Group for their care, skill and commitment. Together, we are building a stronger, more resilient Vanquis with a clear purpose and a compelling future.