Delivering caring banking

so our customers can

make the most of

life’s opportunities

Annual Report and Accounts

for the year ended 31 December 2024

Strategic report

1 Headlines

2 Who we are

4 Chairman’s statement

6 Chief Executive Officer’s review

9 Market overview

11 Strategy

12 Business model

14 Key performance indicators

16 Sustainability

35 Financial review

38 Operating review

44 Section 172(1) statement

46 Non-financial and sustainability

information statement

48 Risk management and principal risks

56 Viability statement

Governance

57 Chairman’s introduction to governance

59 Board of Directors

62 Division of responsibilities

64 Setting our strategy

65 Promoting long-term sustainable

success: Board focus areas during 2024

67 The Board: our culture

70 Stakeholder engagement

and decision making

75 Composition, succession and evaluation

76 Director induction, training

and evaluation

78 Nomination and Governance

Committee Report

82 Audit Committee Report

88 Risk Committee Report

91 Directors’ Remuneration Report

91 Annual Statement by the Chair

of the Remuneration Committee

94 Remuneration at a glance

97 Annual Report on Remuneration

114 Directors’ Report

Financial statements

122 Independent auditor’s report

130 Consolidated income statement

130 Consolidated statement

of comprehensive income

130 (Loss)/earnings per share

131 Dividends per share

131 Balance sheets

132 Statements of changes

in shareholders’ equity

134 Statements of cash flows

135 Statement of accounting policies

144 Financial and capital risk management

149 Notes to the financial statements

197 Alternative performance measures

Shareholder information

200 Information for shareholders

Find out more on our website:

vanquisbankinggroup.com

Our purpose is to deliver

caring banking so our

customers can make the

most of life’s opportunities

Delivering caring

banking

Customers remain at the heart of

everything we do.

5 We care about our

customers’ needs

5 We earn our customers’ trust

5 We empower customers to

make healthy financial choices

5 We support our customers

when it matters most

The Vanquis Way

We created The Vanquis Way to

guide our decisions and remind us

of what’s important when working

with our customers, communities,

and each other.

5 We care about people

5 We pull together as a team

5 We find a better way

5 We get the right things done

Our strategy

Our customer-led strategy

is steeped in a rich, detailed

understanding of the lives and

needs of those we serve.

5 Customer centricity

5 Insightful risk management

5 Efficient organisation

5 Digital, tech, data and analytics

5 A great people proposition

Making the most of life’s opportunities means different things to

different people. It could mean borrowing for a significant purchase

like a car. Or improving their credit score so they have more borrowing

options at better rates. For some, it's simply about managing their

finances more effectively during tighter months.

categories

. This information is summarised below:

5 16% (2023: 18%) of colleagues informed us that they had

a disability or long-term health condition.

5 17% (2023: 18%) of colleagues informed us that they

come from a Black, Asian, other White or minority

ethnic background.

5 5% (2023: 5%) of colleagues informed us that they were

part of the LGBTQ+ community.

5 15% (2023: 11%) of colleagues have caring responsibilities.

1 This data is based on colleagues’ voluntary self-declaration via our

December 2024 Great Place to Work colleague engagement survey which

accounts for 81% of the Vanquis Banking Group workforce.

During 2024, Vanquis Banking Group was awarded the

Silver Standard for LGBTQ+ Diversity, Equality and Inclusion

(DE&I) excellence in financial services in its first assessment

by LGBT Great. In addition, the Group is a member of the

Business Disability Forum and has completed its Disability

Smart Audit to identify areas for prioritisation and focus with

a view to improving disability inclusion across the business.

Engaging our colleagues

We keep our people engaged and informed via regular

Group-wide leadership and colleague communications

and broadcasts. Alongside this, colleagues are encouraged

to develop a sense of community using a variety of tools,

including our ‘Stay Connected’ intranet site. This enables

them to host a range of events, from quizzes to book clubs,

and baking sessions to wellbeing talks.

In December 2024, we, again utilised the Great Place to

Work model in our annual colleague engagement survey.

The key score from this is as follows:

5 60% (2023: 53%) Great Place To Work Trust Index score

While this score shows improvements compared to 2023,

they continue to reflect the levels of uncertainty and

change that colleagues have experienced during 2024.

The Vanquis Banking Group Foundation

Vanquis is committed to improving the lives of children and young people in the communities where our customers live

and work by providing them with access to education, social and financial inclusion, and economic development

opportunities. We deliver on this commitment through the Vanquis Banking Group Foundation which we launched in 2023.

The vision for the Foundation is to build a future where every child and young person in the UK is supported to achieve their

full potential, contributing to a brighter future. During 2024, we did this by focusing on three key strategic pillars:

Education Community Financial inclusion advice

We back programmes that boost literacy

and numeracy rates and offer insights into

the world of work and the skills needed to

secure opportunities.

We support social and financial inclusion

in the communities where we operate.

This work funds a range of money advice,

debt management and financial education

organisations which support our customers

and other consumers to make the most of

their financial options.

In 2024 Vanquis invested £1.4m in the communities we serve via our Foundation.

Strategic report

Vanquis Banking Group plc Annual Report and Accounts 2024

Supporting children and young people to develop

literacy, numeracy and employability skills

We believe that by supporting the education agenda we

can help the children and young people who live and

work in the many communities we serve across the UK

to make the most out of life’s opportunities. Through our

Foundation, we have developed an education programme

to help children and young people to acquire or boost their

skills and aspirations in order to participate in society and

progress in education, the workplace or the communities

they live in.

Throughout 2024, we worked with and supported

organisations such as School-Home Support, National

Numeracy, the Social Mobility Business Partnership, Leading

Children and others to: provide support for programmes to

boost the literacy and numeracy of children, young people

and other groups; and offer children and young people

insights into the world of work and the skills that will help

them secure opportunities, including employment.

National Numeracy Day 2024

On 22 May 2024, we were a Lead Supporter of National

Numeracy Day, which aims to showcase numeracy in

everyday life and help the nation to build confidence when

working with numbers, for the seventh year running. On the

day itself, and throughout May, our colleagues engaged

in a range of activities which highlighted how essential

numeracy skills are for navigating modern life, from

managing personal finances to excelling in the workplace.

This included engaging with schools to deliver numeracy

assemblies and classroom activities to support children to

think and be more confident about using numbers in the

real world, building on our long-standing relationship with

the Professional Darts Corporation to link up with National

Numeracy to deliver a Bullseye Maths Challenge in honour

of the day to schoolchildren at The O2 in London, and

teaming up with National Numeracy Ambassador Bobby

Seagull to create some videos which helped to explain

some common financial terms. We also hosted a ‘Big

Number Natter’ for our colleagues which provided them

with an opportunity to talk about their experience with

maths, and get advice and support on becoming more

confident with numbers.

Ensuring children are able to be in school,

ready to learn

We are incredibly proud of the partnership we have with

School-Home Support (SHS), whose work we have funded

in Bradford and Kent since 2016. Our funding has enabled

SHS practitioners to work with both parents/carers and

children to make an assessment of the key challenges they

are facing, and which are acting as a barrier to children

attending school. The approach that the practitioners take

looks beyond the school gate and works with families to

understand and overcome the root causes of absence

and improve attendance and participation levels. Our

partnership has also sought to support families who

face financial hardships as a result of the ongoing cost-

of-living crisis, coupled with increasingly stretched local

services. Through the School Uniform Fund we established

with SHS in 2022, its practitioners can provide a child with

all the clothing they need to feel comfortable at school.

The work that SHS delivers is transformative and delivers

lasting impacts for children, young people and families.

This is why we were delighted that our partnership was

highly commended under the Banks and Financial Services

category at this year’s Business Charity Awards 2024.

Supporting students with work insight and skills

Through our longstanding partnerships with the Ahead

Partnership and Social Mobility Business Partnership, and

the relationships we have with schools and colleges in the

communities surrounding our offices in Bradford, Chatham,

London and Petersfield, we have delivered a number

of sessions which engage with young people who face

barriers or are underrepresented within our workforce, to

build their aspirations, skills and careers knowledge and

support them to think about what steps they could take

towards realising their future job prospects. During the

year, over 60 colleagues supported almost 200 students by

working with our partners to deliver sessions on the roles

that exist within our sector, goal setting and action planning,

interview preparation and practice and CV writing.

Community investment

We aim to support local community groups to address

a wide range of social and financial inclusion issues that

are relevant to our customers and the communities where

we operate. We do this via the community foundation

partnerships we currently have with Bradford District

Community Foundation, Hampshire and Isle of Wight

Community Foundation, Kent Community Foundation

and London Community Foundation. By working with our

community foundation partners, we have the confidence

that we are directing our funding to the places where it is

needed the most. In 2024, through our four partnerships in

Bradford, Kent, London and Hampshire, we provided grants

of between £2,500 to £10,000 to grass roots community

organisations. The grants will help organisations to

address a wide range of complex issues, such as reducing

inequality, exclusion and disadvantage for children and

young people.

Bradford 2025 City of Culture

Having been based in Bradford since 1880, we are proud to

support the district in its capacity as the UK’s City of Culture

in 2025. We were named as the first official delivery partner

for Bradford 2025 back in 2022, and this will see us support

the development of the cultural programme and ensure

that it leaves a legacy for years to come. The impact that

this designation will have on the Bradford district cannot

be underestimated, in terms of driving inward investment,

boosting local economic growth and delivering a lasting

social and cultural legacy, particularly for young people,

and that’s something we are really proud to be part of.

Governance Financial statementsStrategic report Shareholder information

Vanquis Banking Group plc Annual Report and Accounts 2024

Sustainability continued

The Vanquis Banking Group Foundation

continued

Colleague volunteering

All our colleagues can take two days’ volunteering leave

every year which helps them to engage with our purpose

to deliver caring banking and support the causes they care

most about as well as the community initiatives that are

supported by the Group. Throughout the year, colleagues

volunteered 2,546 hours (2023: 1,696 hours) in support of

a range of community projects and initiatives. This has

enabled our colleagues to give up their time to volunteer

as charity trustees and treasurers and Parent Teacher

Association members or to take part in tree planting

initiatives. It also gives our colleagues the opportunity to

take part in team challenges which are facilitated by the

business. For example, during 2024, 15 colleagues from our

technology and change team volunteered 109 hours to

build a new adventure play area at Clayton Village School

in Bradford and 30 colleagues from our Vehicle Finance

business in Hampshire volunteered around 200 hours to

redecorate Connor’s Toy Library, a resource at St. Mary’s

Hospital, Portsmouth, which provides support for families

with children with Down syndrome.

Our Foundation plans for 2025

Throughout 2024, as our focus has been on progressing the

turnaround of our business and delivering cost savings, we

took the opportunity to make some changes to the Vanquis

Foundation. We will continue to support children and young

people through our existing education partnerships to

develop the literacy, numeracy and employability skills they

need to achieve their potential. However, we will, in 2025,

reduce the number of community foundation partnerships

we support from four to one. This will see us continue to

support the Bradford District Community Foundation to fund

grass roots community organisations across the Bradford

district to address a range of social inclusion issues. We

will also continue to engage in colleague volunteering and

fundraising activities.

Climate-related disclosures

Playing our part in tackling climate change is aligned with

our purpose to deliver caring banking which is why we are

committed to ensuring that we understand the risks and

opportunities that climate change presents to our business

and key stakeholders.

We recognise that the growth and sustainability of our

business depend on the resilience of our operations, our

supply chains, and the communities where our customers

and colleagues live and work. As such, we aim to minimise

our environmental impacts and work with others to take

action on the issue of climate change. Our commitment to

do this is underpinned by our ambition to achieve net zero

carbon dioxide emissions from 2021 levels by 2040. In doing

so, we acknowledge that it is not possible for anyone to get

to net zero alone. Interventions by Government in terms of

policy and to support the development of new technologies

and initiatives are vital to creating a low carbon economy

and enabling everyone to transition to net zero in a fair and

just way. Without good progress on these issues, achieving

our climate ambitions will be challenging. Companies from

all sectors and all their stakeholders must work in concert

in order to make this transition a reality.

Climate-related financial disclosures

compliance summary

Vanquis Banking Group plc confirms that it has made

climate-related financial disclosures for the year ended

31 December 2024 that it believes are consistent with the

four pillars and 11 recommended disclosures of the Task

Force on Climate-related Financial Disclosures (TCFD)

(as defined in the FCA’s Listing Rule 6.6.6(8), the Climate-

related Financial Disclosure (CFD) Regulations 2022 and

the UK Companies Act (that is, sections 414CB(2A)(a to

h)). The text and table below and overleaf outlines how

the 11 recommendations have been addressed within the

Strategic Report.

TCFD pillars TCFD recommended disclosures

Strategic Report section

where disclosures comply

with the Companies Act

Strategic Report section

where further details comply

with the FCA’s Listing Rules

Governance – Disclose

the organisation’s

governance around

climate-related issues

and opportunities.

Describe the Board’s oversight

of climate-related risks and

opportunities.

Climate governance (see pages

23 and 24)

Effective stakeholder communication

(see pages 70 to 74)

Non-financial sustainability information

statement (see pages 46 and 47))

Governance – How the Board

oversees the assessment and

management of climate-

related risks and opportunities

(see page 23)

Describe management’s role in

assessing and managing climate-

related risks and opportunities.

Climate risk management (see pages

31 and 32)

Risk management and principal risks

(see pages 48 to 55)

Governance – Management’s

roles and responsibilities in

assessing and managing

climate-related risks and

opportunities (see page 24)

Our sustainability strategy continued

Strategic report

Vanquis Banking Group plc Annual Report and Accounts 2024

TCFD pillars TCFD recommended disclosures

Strategic Report section

where disclosures comply

with the Companies Act

Strategic Report section

where further details comply

with the FCA’s Listing Rules

Strategy – Disclose the

actual and potential

impacts of climate-

related risks and

opportunities on the

organisation’s business,

strategy and financial

planning where such

information is material.

Describe the climate-related risks

and opportunities the organisation

has identified over the short,

medium, and long term.

Our sustainability strategy (see page 18)

Non-financial Sustainability Information

Statement (see pages 46 and 47)

Our climate strategy, time

horizons, and climate-related

risks and opportunities

explained (see pages 22,

24 and 25)

Describe the impact of climate-

related risks and opportunities

on the organisation’s businesses,

strategy, and financial planning.

Climate-related risks and opportunities

(see pages 24 and 25)

Our climate strategy and

business impacts (see pages 22,

24 and 25)

Describe the resilience of the

organisation’s strategy, taking into

consideration different climate-

related scenarios, including a 2°C

or lower scenario.

Climate-related scenario analysis (see

pages 26 to 30)

Scenario analysis and the

resilience of our strategy

(see pages 26 to 30)

Risk management

– Disclose how the

organisation identifies,

assesses and manages

climate-related risks.

Describe the organisation’s

processes for identifying and

assessing climate-related risks.

Climate risk management (see pages

31 and 32)

Risk management and principal risks

(see pages 48 to 55)

Risk management – Our

processes for identifying and

assessing climate-related risk

(see pages 31 and 32)

Describe the organisation’s

processes for managing climate-

related risks.

Climate risk management (see pages

31 and 32)

Risk management and principal risks

(see pages 48 to 55)

Risk management – Our

processes for monitoring and

managing climate-related risk

(see pages 31 and 32)

Describe how processes for

identifying, assessing, and

managing climate-related

risks are integrated into the

organisation’s overall risk

management.

Climate risk management (see pages

31 and 32)

Risk management and principal risks

(see pages 48 to 55)

Risk management – How we

integrate climate-related risks

into our risks management

policies and processes (see

pages 31 and 32)

Metrics and targets –

Disclose the metrics and

targets used to assess

and manage relevant

climate-related risks and

opportunities where such

information is material.

Disclose the metrics used by the

organisation to assess climate-

related risks and opportunities

in line with its strategy and risk

management process.

Our sustainability performance

at a glance (see page 18)

Climate-related metrics and targets

(see pages 32 and 33)

Non-Financial Sustainability Information

Statement (see pages 46 and 47)

Metrics and targets – Overview

of our metrics (see pages

32 and 33)

Disclose scope 1, scope 2, and, if

appropriate, scope 3 greenhouse

gas emissions (GHG), and the

related risks.

Metrics and targets – Our scope 1,2 and

3 GHG emissions (see page 33)

Metrics and targets – Our

scope 1,2 and 3 GHG emissions

(see page 33)

Describe the targets used by the

organisation to manage climate-

related risks and opportunities and

performance against targets.

Our sustainability performance

at a glance (see page 18)

Climate-related metrics and targets

(see pages 32 and 33)

Metrics and targets – Overview

of our metrics (see pages

32 and 33)

Governance

How the Board oversees the assessment and management of climate-related risks and opportunities

The Vanquis Banking Group plc Board has ultimate accountability for all risks, including climate-related risks and

opportunities. It also has overall accountability for the delivery of the Group’s ESG strategy and regularly reviews performance

in accordance with this strategy. The Board fulfils this accountability by receiving annual updates at its meetings. It is also

supported by the Board’s other committees (see below). The Board has a range of environmental experience, as set out on

page 75 of the Vanquis Banking Group plc Annual Report and Financial Statements 2024, with 90% of the Board classified

as having skills and experience in this area.

Board Audit Committee Remuneration Committee Risk Committee

The Board is responsible for promoting

the long-term success of Vanquis

Banking Group and delivering sustainable

value for our shareholders. This includes

reviewing the Group’s climate change

objectives as part of a broader review of

the Group’s purpose/ESG strategy and

setting the Group’s risk appetite, which

includes risks related to climate change.

Supports the Board in

reviewing the climate-related

disclosures made by the

Group in its Annual Report and

Financial Statements.

Assists the Board in its

oversight of its remuneration

policies and practices in

relation to any ESG-related

metrics, including those

that relate to the climate

change agenda.

Assists the Board by taking

an active role in defining risk

appetite, and monitoring the

risk management and internal

control systems across the

Group. This includes any

climate-related risks.

Governance Financial statementsStrategic report Shareholder information

Vanquis Banking Group plc Annual Report and Accounts 2024

Governance continued

Management’s roles and responsibilities in assessing

and managing climate-related risks and opportunities

The Group’s CEO is accountable for management oversight

in relation to the progress being made by the Group in

managing its strategic ESG objectives, including those

that relate to climate change. In addition, other Executive

Committee members, have responsibilities for delivering

specific activities which support the Group to assess

and manage climate-related risks and opportunities. For

example, the Group’s Chief Risk Officer chairs the cross-

functional Climate Risk Committee (CRC) which provides

guidance and direction, on an annual basis, for the

identification, assessment and management of climate

change-related risks and opportunities that are material to

the Group and its stakeholders. This supports the business

in meeting its reporting obligations.

Internal audit

Our Internal Audit function periodically reviews the controls

that are in place to manage and/or mitigate climate

related risks. This was last done in 2023.

Remuneration

The remuneration of our executive directors continues to be

partly linked to our progress in meeting climate risk-related

reporting requirements and working towards the setting

of longer-term carbon reduction targets, via their annual

bonus plan. There is also an ESG underpin in the Group’s

Restricted Share Plan (RSP), whereby awards are granted

annually to executive directors in the form of conditional

awards or options. For more information, refer to the

Directors’ Remuneration Report on pages 91 to 113.

Our climate strategy

Our strategy is to ensure that climate-related risks are

integrated into our business strategy and decision making

in areas such as operational resilience, customer service,

and supply chain management, and, where appropriate,

capital allocation. In order to deliver on our strategy, our

approach is to identify climate-related risk factors and

opportunities which have potential to impact our business

activities over short-term, medium-term and long-term

time horizons. In doing this, we consider the climate-related

risks and opportunities in the context of the products and

services we provide to our customers, as well as those that

relate to our operation and infrastructure.

Our time horizons explained

We use the following time horizons to classify climate-

related risks and opportunities, aligned to our strategy and

business plans. These time horizons are consistent with

other risks that we manage; however, we acknowledge

that the time horizon over which climate-related risks will

manifest themselves may be a significantly longer time

horizon than we experience with other risk types:

5 Short term: Zero to one year – Accounts for any

climate-related risks and opportunities that are deemed

material to our annual reporting cycle and associated

operational activities.

5 Medium term: One to five years – Accounts for the

financial and operational planning we use, as well as

the goal date for the science-based targets we set in

January 2024.

5 Long term: Five or more years – Takes account of

whether the transition to net zero is progressing or

failing, and whether exposure to any physical risks is

being adequately priced in.

Climate-related risks

We continue to use two major risk categories: physical

risks (which include acute, extreme weather events, and

chronic, long-term climate shifts in the UK), and transition

risks (which relate to regulatory changes, technological

innovations and customer demand changes that may

occur while transitioning to a low-carbon economy).

Risk type Description and business impact Time horizon(s)

Physical (acute)

Specific weather-related events (e.g., heavy rain, high winds or periods of drought)

could result in flooding, storms or wildfires which could have an impact on

infrastructure, causing damage to buildings and other assets, leading to wide-scale

disruption to service delivery. The successful delivery of our strategy is dependent

on the protection of our colleagues, customers, and business infrastructure

and processes.

Short and medium term

Physical (chronic)

Chronic climate-related events, such as rising sea levels, coastal changes and higher

average temperatures and rainfall, could impact regions and infrastructure that

are material to our own facilities/business premises, as well as the operations of the

organisations in our direct and indirect supply chains. Such physical risks could lead to

indirect economic and social impacts through supply chain disruptions, subsequent

impacts from infrastructure damage (e.g. in relation to transport, communication and

manufacturing processes) or market shifts (such as increases in insurance premiums).

Long term

Transition (policy/legal)

New or additional climate-related laws, regulations or contractual commitments (e.g.

those that apply to energy usage, business travel or GHG emissions) may result in

increased compliance costs, taxes on emissions, penalties or restrictions that relate to

our business models and our stakeholders.

Medium and long term

Transition (reputation)

Our customers, colleagues, investors, regulators and other stakeholders expect us to

take appropriate measures to reduce our contribution to climate change. Our brand

is essential to the growth and success of our business. Damage to our reputation as a

result of poor environmental performance, including the failure to meet any climate-

related commitments or regulatory expectations, could result in negative media

attention and may impact customer or investor demand or result in a loss of existing

talent or the inability to attract new talent.

Short, medium

and long term

Sustainability continued

Our sustainability strategy continued

Strategic report

Vanquis Banking Group plc Annual Report and Accounts 2024

Climate-related opportunities

We have also identified two opportunities that are likely to arise as result of the transition to a low-carbon economy which

we anticipate manifesting in the short, medium and long term. These relate to meeting the needs of our customers as

climate-related policies are implemented and continuing to improve the energy and resource efficiency of our operations

and infrastructure.

Opportunity type Description and business impact Time horizon(s)

Products and services

We continue to monitor opportunities to adapt our business models whereby we can

develop and introduce new products and services which meet both the needs of our

customers and the requirements of emerging climate-related policies (e.g. in relation

to the financing of battery electric vehicles (BEVs)). See page 29 for more information.

Medium and long term

Resource efficiency

and resilience

We continue to identify opportunities by which we can improve the energy efficiency

of our operations and infrastructure to ensure that we reduce their carbon intensity

and that they are resilient. During 2024, this has involved complying with Phase 3 of the

Energy Savings Opportunities Scheme (ESOS).

Short, medium

and long term

Scenario analysis

Scenario analysis is a key tool to identify the potential impact of climate-related risks and opportunities on our business,

strategy and financial planning. Our analysis makes use of the Group’s financial forecasts, operational footprint, customer

data, supply chain information and environmental data, to create a representation of Vanquis Banking Group. To support

this, the three climate scenarios developed by the Network for Greening the Financial System (NGFS) set out below have

been used for a second year to support the assessment of the risks we have identified, which categorise climate scenarios

into the following three transition types, which provide a plausible representation of future climate based on potential

trajectories of future levels of greenhouse gas emissions: Orderly, Disorderly, and Hot House World.

NGFS scenarios

NGFS Net Zero 2050 (Orderly) NGFS Fragmented World (Disorderly) NGFS Current Policies (Hot House World)

Global warming is limited to 1.5°C through

the introduction of stringent climate policies

and innovation, reaching net zero CO

emissions globally around 2050. Carbon

Dioxide Removal is used to accelerate the

decarbonisation but kept to the minimum

possible and broadly in line with sustainable

levels of bioenergy production. Physical risks

are relatively low but transition risks are high.

Therefore, we have selected this scenario as

it aligns with the Group’s ambition to achieve

net zero GHG emissions by 2040.

This scenario illustrates the adverse

consequences of delayed and divergent

climate policy ambitions globally which lead

to high physical and transition risks. Countries

without net zero targets follow current

policies, while other countries achieve them

only partially (e.g. 80% of the target). Climate

scenarios in the Disorderly case can limit

warming to <2°C, resulting in low physical

risks, but may demonstrate higher transition

risks compared to the Orderly scenario. This

scenario has been selected as it describes

the mitigations required across the economy

to limit warming to <2°C.

This scenario assumes that only currently

implemented climate policies are

maintained, with no further strengthening.

Global GHG emissions grow until 2080,

leading to about 3°C of warming and

irreversible changes such as higher sea

level rise. It is considered the best suited to

assessing physical risks according to the

NGFS. This scenario is being used because

there is potential for the Group and its key

stakeholders to be impacted by the physical

risks associated with climate change that

could occur as a result of there being

limited or no economy-wide mitigation

measures in place.

In analysing the results of our scenario analysis, we have used a financial impact to represent the estimated loss to the

Group’s revenues over the next five years assuming that no mitigating action is taken. This impact has been rated in the

following way: high (a loss impacting the income statement by more than 20% and/or by more than £20m); medium (a

loss impacting the income statement by between 10% and 20% and/or between £5m and £20m); and low (a loss impacting

the income statement by between 5% and 10% and/or by between £1m and £5m).

Governance Financial statementsStrategic report Shareholder information

Vanquis Banking Group plc Annual Report and Accounts 2024

Our climate strategy continued

The impact of climate-related risks and opportunities on our businesses, strategy and financial planning

Physical risks Acute risks Chronic risks

Scenario Orderly Disorderly Hot House World

NGFS Net Zero 2050 NGFS Fragmented World NGFS Current Policies

Description

In this scenario global warming is

limited to 1.5°C through stringent

climate policies and innovation, with

the goal of reaching net zero CO

emissions around 2050. It assumes

that ambitious climate policies

are introduced immediately. In this

scenario, physical risks, which broadly

encompass the quantification of a

company or country’s exposure to

natural catastrophes that could be

reliably tied to climate change and a

warming environment, are relatively

low. However, transition risks are high.

This scenario assumes a delayed and

divergent climate policy response

among countries globally, leading

to elevated transition risks in some

countries and high physical risks

everywhere else due to the overall

ineffectiveness of the transition to a

net zero economy.

This scenario works on the basis

that only current enacted policies

continue, resulting in increased

physical risks. Emissions will

continue to rise until 2080, leading

to approximately 3°C of warming

and acute and chronic physical risks

encompassing irreversible changes

such as heightened sea levels

and severe drought in a range of

geographical locations.

NGFS risk rating

Low Medium High

Financial impact/

risk to Group

Low Low Medium

Time horizon

Short and medium term Medium and long term Long term

Impact

In this scenario, there is likely to be an

increase in the instances of extreme

weather events such as heavy rain,

high winds and heatwaves. For

Vanquis, the impacts of these events

are likely to be minimal.

While climate-related physical risks

also increase in this scenario, the

impact caused by, for example,

extreme weather patterns, is much

smaller than in the Hot House World

scenario. This is because this scenario

assumes that global climate policies

in some countries and sectors are

partially successful in lowering global

GHG emissions, which mitigates

the most extreme changes in the

climate. This is likely to result in more

vulnerable parts of the world being

exposed to the impacts of the long-

term changes in climate and weather

patterns. In the UK, there would likely

be significant regional variability

in flooding impacts but it should

be noted that, according to the

Flood Re scheme, large areas of the

country are not materially impacted

by flood risk. However, it is likely that

this scenario would result in more

instances of extreme weather events,

such as heatwaves, heavy rainfall and

high winds, which could disrupt work

environments and routines.

The greatest impact in physical risk

is seen in this scenario as the cost

of damage caused by inland and

coastal flooding, high winds and

subsidence is expected to increase

as the global mean temperature

rises. This could pose a threat to the

Group’s properties and infrastructure

which, in turn, could impact our

insurance or reinsurance costs, as

insurance companies could face

higher payouts due to climate-related

damages. This scenario could also

have the greatest consequences in

terms of colleagues’ productivity as

extreme weather events may disrupt

work environments and routines

which could have implications for our

customers.

Sustainability continued

Our sustainability strategy continued

Strategic report

Vanquis Banking Group plc Annual Report and Accounts 2024

Physical risks Acute risks Chronic risks

Scenario Orderly Disorderly Hot House World

NGFS Net Zero 2050 NGFS Fragmented World NGFS Current Policies

Mitigation

measures

Vanquis continues to adopt the following actions in order to mitigate against the physical risks described above:

continuing to maintain and test business continuity plans to ensure the continuity of our operations in a range of

situations, including those where an extreme weather event occurs; implementing measures to improve energy efficiency

across the Group on an ongoing basis; and shifting to more sustainable, low-impact resources and having a series of

targets to achieve this aim (for example, to ensure that we use 100% renewable energy across the Group).

In terms of Vanquis Banking Group’s exposure to physical risks, although it is accepted that extreme weather events will

increase in number and severity compared to the present, they are unlikely to be as severe as those expected under the

‘Current Policies’ scenario. Also, the direct financial impacts associated with these events are considered to be minimal

for the Group because its four main offices are leased, and insurance is in place to help mitigate the impacts of such

physical risks. We will continue to monitor the exposure of our main offices to surface water flooding and river/sea flooding

using resources made available by the Environment Agency. According, to the Agency’s National Flood Risk Assessment

(NaFRA) data (January 2025), which uses bespoke software to integrate detailed local flood risk models – both its own and

those of local authorities – into a national picture, the long-term flood risk relating to our four main properties is as follows:

Surface water flooding River and sea flooding

Property

Yearly chance

of flooding

Yearly chance

of flooding between

2040 and 2060

Yearly chance

of flooding Y% o

Bradford Medium High Very low Very low

Chatham Very low Very low Very low Very low

London Very low Very low Very low Very low

Petersfield Very low Very low Very low Very low

While NaFRA data indicates the long-term risk of surface water flooding in the area where our Bradford-based head office

is located is high, it should be noted that there have been no incidents of flooding since the premises were built in 2010.

Further, in 2025, we will relocate our Bradford office to an area where the risk of surface water flooding is low and the risk of

river flooding is very low. We will continue to monitor the Environment Agency’s NaFRA data to assess the exposure of the

Group’s main premises to long-term flood risk.

Governance Financial statementsStrategic report Shareholder information

Vanquis Banking Group plc Annual Report and Accounts 2024

Sustainability continued

Our sustainability strategy continued

Our climate strategy continued

The impact of climate-related risks and opportunities on our businesses, strategy and financial planning continued

Transition risks Policy and legal risks

Scenario Orderly Disorderly Hot House World

NGFS Net Zero 2050 NGFS Fragmented World NGFS Current Policies

Description

Policy and legal risks that are associated with climate change continue to evolve. The actions that relate to this risk

category seek to achieve two key objectives: limit and, ultimately, stop the activities that contribute to the effects of

climate change and promote actions that support adaptation to a changing climate. This will necessitate the switching

to alternative sources of energy such as solar, wind or nuclear, as well as the deployment of carbon, capture and storage

(CCS). In addition, deployment of Carbon Dioxide Removal (CDR) technologies will compensate for the GHG emissions

by removing carbon from the atmosphere. The above scenarios use three different models to provide estimates of

uncertainty. In the medium term, the amount of CO

emissions under the ‘Current Policies’ scenario differs considerably.

There are also different estimates for when net zero CO

emissions must be reached in order to limit warming to 1.5°C.

A significant shift towards emissions-neutral alternatives in all sectors is needed to replace fossil fuels and carbon-

intensive production and consumption. In order to facilitate this transition, policymakers will increase the implicit cost

of GHG emissions. In the meantime, climate policies may result in higher costs due to the prolonged development and

deployment of alternative technologies. According to the NGFS scenarios, higher carbon emissions imply strict policies,

and a carbon price of around $160 per tonne would be needed by 2030 to encourage a transition to net zero by 2050. In

addition, the Bank of England’s scenario work indicates the price of carbon would need to increase from where it currently

is, at $32 per tonne, to $150 per tonne by 2030, rising to $900 per tonne by 2050. It should also be noted that governments in

other jurisdictions are enforcing strict policies which bring different costs and benefits.

NGFS risk rating

Medium High Low

Financial impact/

risk to Group

Low Low Low

Time horizon

Medium and long term Long term Medium and long term

Impact

This scenario assumes a decline

in total global GHG emissions, with

advanced economies leading the

way, met through a combination

of policy and legal interventions

resulting in the rapid deployment

of clean energy technologies,

energy efficiency and consumer

demand reduction for carbon

intensive products and services. In

this scenario, it is anticipated that

carbon removal costs are predicted

to be volatile which could have

implications for Vanquis in terms

of its ability to achieve its net zero

by 2040 ambition. As such, the

uptake and costs associated with

carbon removal will continue to be

monitored. Further, if the price of

carbon increases as expected in

this scenario, there is scope for the

costs associated with our operations

and travel and transport to increase

which could have implications for the

Group’s revenues. Our current analysis

indicates that the Group’s exposure

to this risk is low as, despite the

anticipated increasing carbon price,

the costs associated with our scope

1 and 2 GHG emissions remain below

the financial impacts (see page 25)

which are used to estimate the loss

to the Group’s revenues over the next

five years assuming no mitigating

action is taken.

This scenario assumes a delayed and

divergent climate policy response

among countries globally. This

sees countries with net zero targets

partially achieving them and the

other countries continuing with

current policy and legal interventions.

In these circumstances, carbon

prices and amounts of investment

are different across geographies, with

some countries’ ambitious efforts

being undermined by limited action

in some others. At the same time,

climate policies differ significantly

across sectors; the transport and

buildings sectors experience carbon

prices three times as high as the rest

of the economy. The combination

of these misaligned efforts across

countries and sectors leads to higher

transition risks which could contribute

to decreasing the Group’s revenues.

In this scenario, we would not see

the impact of transition risks, but we

would expect to see the impact of

physical risk in the long term. However,

as discussed above, we would

expect an adverse overall economic

outcome, but do not consider it

possible to accurately quantify

these impacts.

Mitigation

measures

The actions the Group will adopt in order to mitigate against these transition risks and ensure that our strategy responds

to any potential opportunities include: analysing the impact of the price of carbon on our operations and travel and

transport activities on an annual basis to determine whether there are any revenue implications; continuing to engage

with our customers on the benefits of using our Vehicle Finance products to purchase BEVs/hybrid vehicles, and at the

same time, engaging with our stakeholders to gain further insight into the used BEV market and the current state of the

charging infrastructure in the UK (see page 29); and continuing to monitor customer default rates due to increased costs

(e.g. as a result of energy cost increases).

Strategic report

Vanquis Banking Group plc Annual Report and Accounts 2024

Transition risks Reputational risks

Scenario Orderly Disorderly Hot House World

NGFS Net Zero 2050 NGFS Fragmented World NGFS Current Policies

Description

Climate change has been identified as a potential source of reputational risk tied to changing customer or community

perceptions of an organisation’s contribution to or detraction from the transition to a lower-carbon economy.

NGFS risk rating

Low Low Medium

Financial impact/

risk to Group

Low Low Low

Time horizon

Short, medium and long term Medium and long term Medium and long term

Impact

Failure to act in a proportionate way

to the climate change agenda has

potential to damage the Group’s

reputation which could impact

customer or investor demand or

result in a loss of existing talent or the

inability to attract new talent. This, in

turn, could result in adverse revenue

implications in the short, medium and

long term. To help mitigate this risk,

the Group is committed to reaching

net zero by 2040 by equalising or

lessening the emissions that are

released into the atmosphere and

has also set SBTi-approved carbon

reduction targets. In addition, the

Group remains committed to sharing

information on its environmental

performance generally, and the

climate risk agenda specifically,

with stakeholders through its annual

disclosures and submissions to, for

example, the CDP.

In this scenario, it is anticipated that

the potential reputational damage

described in relation to the ‘Net Zero

2050’ scenario could apply leading to

negative media attention or changes

in consumer, colleague, investor

and other stakeholder preferences

which could contribute to reducing

the Group’s revenue and/or market

share. As such, the Group will continue

to deliver on its net zero by 2040

ambition and SBTi-approved carbon

reduction targets, as well as engage

with its stakeholders.

In this scenario, as mentioned

above, it is expected that global

climate policy ambition would be

severely delayed. This could lead to

negative media attention or changes

in consumer, colleague, investor

and other stakeholder preferences

which could contribute to reducing

the Group’s revenue and/or market

share. However, it is anticipated that

these impacts could take longer to

be realised or could be generated by

specific stakeholders or in specific

locations (e.g. within the Group’s

supply chain).

Mitigation

measures

The actions the Group will adopt in order to mitigate against these transition risks and ensure that our strategy responds

to any potential opportunities include: continuing our net zero target by 2040 journey by continuing to adopt sustainable

energy sources, implement energy efficiency measures and engage with our suppliers to encourage them to reduce their

own carbon emissions; delivering on our SBTi-approved carbon reduction targets; and ensuring that the remuneration of

the executive directors is partly linked to our progress in meeting the Group’s climate-related goals and targets.

Climate-related opportunities

We continue to review opportunities that will enable

us to introduce new products to our customers which

accommodate their needs and meet emerging climate-

related policy and regulatory changes. The most obvious of

these opportunities relates to enabling our Vehicle Finance

customers to use their loans to purchase battery electric

vehicles (BEVs) or hybrid electric vehicles.

However, the affordability of BEVs continues to be the

main barrier to ownership for the Group’s Vehicle Finance

customers. The average loan amount for our Vehicle

Finance customers stood at £8,728 in 2024. This compares

to the average price of a used battery electric vehicle

(BEV) which, in 2024, was £26,139 (source: Auto Trader

Retail Price Index – December 2024). Of the over 107,800

‘live’ customers that are currently served by our Vehicle

Finance business, 606 have purchased a BEV car, and

31 a BEV light commercial vehicle (see tables below for

further information).

Further, the state of BEV charging infrastructure in the UK

continues to influence uptake of BEV vehicles. According to

a National Audit Office (NAO) report published in December

2024, the UK is on track to meet its target of 300,000 charge

points by 2030, but there are still challenges regarding their

location and accessibility. The NAO report underlines the

need for greater focus on ensuring that more charge points

are available in rural areas and regions outside London and

the South East.

New/used Vehicle finance

New 0.66%

Used 99.34%

Total 100.00%

Fuel type Moneybarn

Diesel 58.19%

Petrol 37.47%

Electric 1.09%

Hybrid electric 2.33%

Electric diesel 0.14%

Gas bi-fuel 0.03.%

ND 0.75%

Total 100.00%

Governance Financial statementsStrategic report Shareholder information

Vanquis Banking Group plc Annual Report and Accounts 2024

Sustainability continued

Our sustainability strategy continued

Our climate strategy continued

Climate-related opportunities continued

We are now also able to report on the carbon intensity of

the vehicles that our loans finance (see table below).

classification (kg CO

e per mile) Moneybarn

0 = > x < 50 4.09%

50 > = x < 100 9.77%

100 > = x < 110 13.38%

110 > = x < 120 15.86%

120 > = x < 130 14.87%

130 > = x < 140 12.73%

140 > = x < 150 8.09%

150 > = x < 200 18.07%

> 200 2.89%

ND 0.25%

Total 100.00%

The resilience of our strategy, taking into consideration

different climate-related scenarios, including a 2°C

or lower scenario

Our sustainability strategy focuses on our customers,

colleagues and suppliers, the communities we serve

and the environment, and supports us to deliver strong

Company performance. This means that climate change

and how our business and key stakeholders respond and

adapt to it are important parts of our overall sustainability

strategy. The analyses we have undertaken to date, the

summaries of which are set out above, show that the policy

and legal risks and reputational risks associated with the

transition to a low-carbon economy, as well as the physical

risks associated with climate change, are most material to

our business activities and key stakeholders and, therefore,

have potential to impact the Group in the short, medium

and long term. While our internal processes determined

that these risks are not likely to have a material impact on

our business over our stated time horizons, we nonetheless

maintain robust mitigation strategies to improve our

resilience to the impacts of climate change. The NGFS Net

Zero 2050 scenario would continue to have the biggest

impact on the Group in the short to medium term before

any mitigating actions were considered or taken into

account. This is primarily due to the potential for increases

in the price of carbon to have an impact on the cost of our

energy use, business and other operating costs.

The NGFS Fragmented World scenario reveals higher levels

of disruption as a result of increases in extreme weather

events and other natural disasters compared with the NGFS

Net Zero 2050 scenario. However, the actions and outline

transition plan that are set out above, will enable the Group

to address any of the concerns associated with these

scenarios as they will contribute to reducing our exposure

to both transition and physical risks.

Under the NGFS Current Policies scenario, despite there

being much uncertainty about the impacts of climate

change, we can expect our business and our stakeholders

to be impacted by more extreme physical risks in the longer

term, as well as a lack of policies to support the transition

to a low-carbon economy. In these circumstances, the

Group would have to ensure that adequate measures were

in place to manage and address the physical risks and

their potential to impact our operations, customers and

other stakeholders.

We continue to use climate modelling and scenario

analysis to ensure that our strategy of understanding and

assessing the risks associated with climate change and

the impact on Vanquis Banking Group’s financial results

continues to evolve so that we can further improve our

resilience and respond to any related opportunities.

In preparing the Group’s financial statements (see pages

130 to 199), we have considered the impact of the results

of our scenario analysis and climate-related risks on our

financial performance, and while the effects of climate

change represent a source of uncertainty, there has not

been a material impact on our financial judgements and

estimates due to the physical and transition climate-

related risks in the short to medium term.

Climate transition plan: progress update

We are committed to doing the things that are within our

power to create the right operating conditions that will

enable us to deliver on our net zero by 2040 ambition. We

recognise, however, that we do not have full control over the

delivery of this ambition as it will require collaboration and

cooperation with other key stakeholders (e.g. Government,

regulators, customers, etc.).

An outline of our climate transition plan, was first set out

in our Annual Report and Financial Statements 2022. This

provided information on our climate ambitions and how we

could address climate risks and opportunities. We will use

the UK’s Transition Plan Taskforce framework and guidance

to inform the development and content of our transition

plans further in the future. Our transition plan activities have

continued to focus on the following areas:

5 Reducing our scope 1 and 2 GHG emissions via

the continued implementation of energy efficiency

measures, use of sustainable fuels and behavioural

change measures, and by monitoring the development

of low-carbon solutions.

5 Reducing our scope 3 GHG emissions by engaging with

our suppliers to set their own carbon reduction targets,

reducing the absolute GHG emissions associated

with business travel, colleague commuting, water use

and waste generation, and by continuing to monitor

developments in the BEV market.

To support our net zero by 2040 ambition and the work we

deliver as we develop our transition plan, we engage with

our key stakeholders to get their input and support. Set out

below are examples of stakeholders we have engaged with

during 2024.

Engaging with our customers

As we support the transition to clean energy, we want to

ease the pressure on our customers by providing support

in areas such as the energy efficiency measures they can

implement at home and with regard to battery electric

vehicles. For example, through our Vehicle Finance business

we provide our customers with guidance on the benefits of

owning an electric vehicle and the cheapest way to charge

the vehicle’s battery.

Strategic report

Vanquis Banking Group plc Annual Report and Accounts 2024

Engaging with industry and other stakeholders

The Group takes part in a number of forums and working

groups with the aim of engaging with and influencing UK

Government policy regarding the climate change agenda.

This is principally done through our membership of UK

Finance. For example, Company representatives engage

with UK Finance’s sustainability working group which

enables the business to keep up to date with developments

relating to climate policy and participate in member

responses to the UK Government.

Engaging with colleagues

We engage with colleagues on the work we are delivering

on the climate risk agenda through communication

channels such as our Group-wide intranet. Colleagues

are also required to take a mandatory e-learning module

on climate change every two years. Finally, we offer our

colleagues volunteering opportunities which support

our net zero ambition. For example, in 2024, this involved

supporting colleagues to take part in tree planting with the

Yorkshire Dales Millennium Trust and the Tree Council.

Engaging with investors

The main means by which we inform our investors of our

work in relation to the climate change agenda is through

the publication of our Annual Report and Accounts. We also

inform and listen to investors through the submissions we

make to the main sustainability investment indices and

rating agencies. In 2024, this involved making submissions

to and engaging with CDP, Dow Jones Sustainability Indices,

FTSE4Good and ISS ESG.

Dependence on government policy

In order to deliver on our transition plan and achieve our

net zero by 2040 ambition, we will need clear government

action on policy and regulation to create the conditions

whereby new low-carbon technologies can be developed

and consumers can be supported to adopt them. Without

progress on this, transitioning to a low-carbon economy

will be challenging. While we are able to reduce the carbon

intensity of our own operations and influence those from

whom we procure goods and services, when it comes to

decarbonising the UK economy as a whole, Vanquis is just

one of many organisations that will have a role to play.

How we identify, assess and manage

climate-related risks

Our processes for identifying and assessing

climate-related risk

We have an established risk management and internal

control framework to identify, assess, measure, monitor and

report the climate-related risks and opportunities we face

as a business. We use this framework to identify potential

exposure to climate-related risks via the associated

physical risks (which include acute, extreme weather events,

and chronic, long-term climate shifts), and transition

risks (which relate to regulatory changes, technological

innovations and customer demand changes that may

occur while transitioning to a low-carbon economy). In

doing so, we use the time horizons described above to

classify the climate-related opportunities and risks, aligned

to our strategy and business plans.

As with all the principal risks, and any sub-category risks,

this framework sets out the high-level policy requirements

and control principles that are in place and those

responsible for managing both the overall risk and the

relevant mitigating controls for further information. It

also adopts an enterprise approach, enabling a single

view of all the current and emerging risks and consistent

management of those risks across the Group. To support

the framework to be effective, the following attributes are

applied: risk culture, risk appetite, risk governance and a

three lines of defence approach to management and

control (see pages 48 to 55 for more information).

In the Group’s newly agreed risk classifications, climate

risk is a level 1 risk which sits within Regulatory principal risk

(P2) (see page 51 for more information). This is because

the Group’s long-term success is dependent on the

sustainability of its operations and business models, and

the resilience of its supply chain. By integrating climate risk

within our framework, it is possible to assess how it interacts

with other material principal risks, including those that relate

to credit, capital, operations, legal and governance matters

and conduct and regulations. All risks are monitored and

reviewed throughout the course of the year to identify

changes that could impact the risk profile.

Our processes for monitoring and managing

climate-related risks

To ensure the ongoing monitoring and management of

the transition and physical risks referenced above and

their potential financial impact on our business we use

a number of processes during the year. These include:

monthly risk appetite reporting using metrics which relate

to carbon pricing, customer default rates, operational

impacts associated with extreme weather events and the

progress being made in relation to our net zero target, and

a risk control self-assessment (RCSA) process for climate

risk which enables us to identify, analyse and understand

the related controls that are in place, and to evaluate

these against our risk appetite and the desired risk levels, to

determine whether any improvements need to be made.

Regular updates are also provided to the Board’s Risk

Committee on the progress made in terms of delivering

mitigating activities which relate to the Group’s climate risk.

The Group’s cross-functional CRC also supports the

embedding of the risk management approach for

identifying and assessing climate-related risks and

mitigating controls. Based on the monitoring that has been

undertaken over the course of the past 12 months, the CRC

continues to recommend that a ‘risk cautious’ appetite

for exposure to climate risk is adopted and supports the

implementation of a control framework that prevents

significant customer or stakeholder detriment, regulatory

non-compliance and/or reputational damage as a result of

climate change.

We continue to use scenario analysis to quantify the

climate-related risks that are material to Vanquis Banking

Group to carry out an initial evaluation of their size, scope

and impact and test the resilience of both our business

strategy and our operations. This enables the business,

through the CRC, to better understand and prioritise the

management and mitigation of any risks.

Governance Financial statementsStrategic report Shareholder information

Vanquis Banking Group plc Annual Report and Accounts 2024

Sustainability continued

Our sustainability strategy continued

How we identify, assess and manage

climate-related risks continued

How we integrate climate-related risks into our risk

management policies and processes

The climate-related risks and opportunities we have

identified are integrated within our risk management and

internal control framework and are continually monitored.

This enables us to evaluate the significance of our risks

based on their likelihood and impact and to prioritise their

management on an ongoing basis. Through this framework,

we also monitor the environment for new and emerging

risks, and keep up to date with any evolving regulatory

requirements. For example, through the Climate Risk

Committee meetings that took place during 2024, we have

been able to monitor developments regarding the work of

the UK Transition Plan Taskforce.

The metrics and targets used by the Group to

assess and manage relevant climate-related

risks and opportunities where such

information is material

The metrics we use to assess climate-related risks and

opportunities in line with our strategy and risk

management process

We use the following metrics to measure the potential

financial impact of climate-related risks and opportunities

on our business and to measure our scope 1, scope 2 and

scope 3 GHG emissions, as well as to track overall progress

including against our ambitions and initiatives.

Risk/opportunity

related category Aspect Metric Targets Progress

Policy and legal

GHG emissions Scope 1, 2 and 3 GHG

emissions reporting.

See GHG emissions reporting

for energy and water use, and

waste management.

See our environmental KPI results

and GHG emissions table on page

33 of this report and the ESG data

table on the Group’s website.

Science-based

targets

Carbon reduction. Reduce scopes 1 and 2 GHG

emissions by 39.9% by 2028

from a 2021 base year.

78% of suppliers by spend

covering purchased

goods and services will

have science-based

targets by 2027.

Our scopes 1 and 2 GHG emissions

have reduced by 60% from a 2021

base year.

Currently, 41% of our suppliers

by spend have set science-

based targets.

Energy source

Renewable energy Renewable energy use. Continue to use 100%

renewable electricity across

our business premises by

December 2024.

We continue to use 100%

renewable energy across our

business premises.

Market

opportunities

Customer

engagement

Customer sentiment

and perception

regarding their ability

to transition to a low-

carbon economy as

well as the Group’s ESG

performance.

Monitor the number of

Group customers using our

Vehicle Finance products to

purchase BEVs and hybrid

electric vehicles.

See pages 29 and 30.

Monitor customer attitudes

and perceptions towards

buying BEVs.

See page 31.

Engage with policymakers to

support the uptake of BEVs by

consumers in the mid-cost

and near-prime parts of the

consumer credit market.

See pages 30 and 31.

Reputation

Supplier

due diligence

Monitor supply chain

activities in line with

the Group’s ESG

commitments and

Corporate Environmental

Management Policy.

See SBTi-approved target

above. Also, engage with

100% of materially significant

suppliers to determine their

exposure to climate risks.

All materially significant suppliers

continue to be engaged on the

climate risk agenda via our due

diligence process.

Investor relations Investor sentiment and

perception regarding

the Group’s ESG

performance.

Continue to participate in

CDP, the FTSE4Good Index,

MSCI, and the S&P Global

Corporate Sustainability

Assessment.

During 2024, we continued

to engage with the CDP, the

FTSE4Good Index, MSCI, and

the S&P Global Corporate

Sustainability Assessment.

Policy/liability

Executive

remuneration

The remuneration of

the executive directors

is partly linked to our

progress in meeting the

Group’s climate-related

goals and targets.

Please refer to the Directors’

Remuneration Report on

pages 91 to 113.

Please refer to the Directors’

Remuneration Report on

pages 91 to 113.

Strategic report

Vanquis Banking Group plc Annual Report and Accounts 2024

Risk/opportunity

related category Aspect Metric Targets Progress

Physical risks

Weather patterns Operational impacts

caused by severe

weather events

and changes in

weather patterns.

Monitor increases in

operating costs (e.g.

associated with increased

insurance premiums and

potential for reduced

availability of insurance on

assets in ‘high risk’ locations).

In addition to continuing to monitor

increases in operating costs, we

use the Environment Agency’s

National Flood Risk Assessment

data to monitor the exposure of

our main offices to surface water

flooding and river/sea flooding.

Our scope 1, scope 2 and scope 3 greenhouse

gas (GHG) emissions, and related risks

Operational emissions

We have set out below our GHG emissions on an absolute

e basis in accordance with Streamlined Energy and

Carbon Reporting (SECR) policy requirements.

Streamlined Energy and Carbon Reporting

The Group reports its GHG emissions and energy usage

data in accordance with the UK SECR policy that has been

implemented through the Companies (Directors’ Report)

and Limited Liability Partnership (Energy and Carbon Report)

Regulations 2018. The table below covers the Group’s

performance for 2023 and 2024. The scope 1 and scope 2

GHG emissions, and energy use figures relate to the UK.

2023 2024

Scope 1 GHG emissions (tonnes of CO

Gas use 186 107

Diesel and petrol use 15 5

Scope 2 GHG emissions (tonnes of CO

Electricity use (market-based emissions) 556 371

Electricity use (location-based emissions) 604 389

Scope 3 GHG emissions (tonnes of CO

Scope 3 associated ‘well-to-tank’ emissions 81 275

Scope 3 category 1 – purchased goods

and services

2,3

20,210 23,439

Scope 3 category 3 – fuel and energy-related

activities (not included in scope 1 and 2) 233 147

Scope 3 category 5 – waste generated

in operation 10 4

Scope 3 category 6 – business travel

688 1,080

Scope 3 category 7 – employee commuting

724

1,124

Scope 3 category 13 – downstream leased

assets (market based)

- -

Scope 3 category 15 – investments

303,846 262,417

Total energy consumed (kilowatt hours) 4,389,415 2,462,245

Scope 1 and 2 (and associated scope 3)

emissions intensity ratio (kg of CO

per customer) 0.59 0.69

Emissions calculation methodology and basis of preparation

1 The market-based emission factors from two suppliers are in CO

and

not CO

e (i.e. do not include non-CO

emissions); however, the variance

between CO

and CO

e is considered to not be material. The supplier

emissions factors used in the market-based method covers the period

1 April 2023–31 March 2024 only.

2 When calculating the suppliers’ carbon emissions using the spend-based

method, we used the UK Government Department for Business, Energy &

Industrial Strategy which was published in June 2023 and present data from

2019. However, due to inflation, an inflation rate of £1.02 has been applied

to ensure accuracy and transparency. Specific GHG emission conversion

factors that relate to specific SIC code categories have been applied to 77%

of the Group’s suppliers by spend, with a SIC code average conversion factor

applied to the remaining 23% of suppliers by spend.

3 In the absence of wastewater treatment volume data for some offices, we

have assumed that the wastewater treatment volume figures are the same

as the water supply volume figures; this approach results in an overestimate

of the total water treatment volumes.

4 The significant increase in business travel emissions is due to corresponding

increase in the amount of business travel that colleagues have engaged in

to destinations associated with our outsource partners.

5 Employee Commuting to Work GHG emissions (tCO

e) are based on a 2024

employee survey. The significant increase in employee commuting GHG

emissions is due to a corresponding increase in colleagues travelling to our

main business premises.

6 This figure was reported as 9,766 tonnes of CO

e in 2023 but has been

restated to 724 tonnes of CO

e to correct a reporting error.

7 The office that was leased by the Group during 2023 is no longer being

leased by the Group.

8 The emissions from the vehicles that are financed by the Group are based

on the number of live vehicle financial agreements for the 2024 reporting

period. The vehicle emission factors are in CO

and not CO

e (i.e. do not

include non-CO

emissions); however, the variance between CO

and CO

is not considered to be material.

Data dependencies and limitations

We recognise that there are certain limitations in climate

data which have potential to affect our climate metrics and

targets, and, in turn, their usefulness in terms of informing

our strategic decision making. Due to the limited availability

of publicly available, accurate, consistent and comparable

climate-related data (for example, in relation to our scope

3 emissions), there are a number of assumptions and

judgements that have been made in order to undertake

scenario analyses and model our risk exposures. The most

important are:

Calculating our scope 3 upstream emissions

Our scope 3 upstream emissions for category 1 (purchased

goods and services) are calculated using a spend-based

methodology which involves estimating these emissions

based on the value of the goods and services that we

purchase from our suppliers. This is achieved by calculating

the economic value of the goods and services we procure

and multiplying this figure by emission conversion factors

which, in our case, are set by the UK Government. While this

is an accessible and affordable methodology, it can lead

to some volatility in the scope 3 category 1 emissions data

that is reported because of its reliance on estimates and

average emission factors. Further, our ability to identify,

analyse, and monitor emissions reduction efforts related

to purchased goods and services is restricted when the

spend-based method is employed. This is because the

main way to reduce emissions when a spend-based

method is used is to reduce spending which is not a viable

option and may not align with our wider business goals.

Governance Financial statementsStrategic report Shareholder information

Vanquis Banking Group plc Annual Report and Accounts 2024

Our sustainability strategy continued

Data dependencies and limitations continued

Calculating our scope 3 downstream emissions

Our scope 3 category 15 (investments) GHG emissions

which relate to the vehicles financed by the Group are

based on the number of live Vehicle Finance agreements

during the 2024 calendar year reporting period and are

calculated using average CO

emissions data that is held

by our Vehicle Finance business and an assumption that,

on average, our customers travel 12,000 miles per year.

Limitations of climate scenario analysis

An important aspect of our climate-related financial

disclosure involves undertaking an analysis using

prescribed scenarios. It should be noted that these

scenarios are not forecasts and do not seek to predict

future outcomes. Rather, they are forward-looking

projections of risk outcomes that focus on: identifying

physical and transition risk scenarios; linking the impacts of

the scenarios to financial risks; assessing any sensitivities

to those risks; and extrapolating the impacts of those

sensitivities to calculate an aggregate measure of

exposure and potential losses. They do not and cannot

reflect all potential future pathways. Furthermore, the NGFS

scenarios that are used in our analysis may overestimate

or underestimate systemic climate-related risks.

Cautionary statement

This disclosure is presented for information and reference

purposes only and should not be treated as giving any

form of advice. Its preparation is based on reviews and

analysis of our internal data, which is from management

systems separate from those that form part of our financial

reporting internal controls framework. Whilst statements

made within the disclosure are presented in good faith

and based upon sources expected to be reliable, their

accuracy is not guaranteed. For certain information within

the disclosure, preparation has included various key

judgements, assumptions, and estimates, some of which

are summarised above. Where information is presented

from a public or third-party source, it has not been

assured in accordance with the International Standard

on Assurance Engagement (ISAE) 3000 (Assurance

Engagements other than Audits or Reviews of Historical

Financial Information) and the relevant subject matter

specific ISAE standard for GHG data (ISAE 3410, Assurance

Engagements on Greenhouse Gas Statements). Any third-

party opinion or views disclosed in this report are those of

the third parties themselves, and not of Vanquis Banking

Group. The Group recognises that climate-related reporting

is not yet subject to the same standardised disclosure

framework as traditional financial reporting which has

potential to result in non-comparable information or

measures between companies and between reporting

periods as disclosure frameworks continue to evolve.

Sustainability continued

Strategic report

Vanquis Banking Group plc Annual Report and Accounts 2024

Financial review

ʥʣʥʧˣ˘˥˙ˢ˥ˠ˔ˡ˖˘˥˘Є˘˖˧˦

the operational turnaround

Despite a meaningful adjusted and statutory loss in 2024,

the Group now has a cleaner and lower-risk balance sheet

following the completion of the Vehicle Finance Stage 3

receivables review and the addressing of one-off items

linked to the comprehensive balance sheet review.

We have adopted a measured approach to Credit Cards

growth, testing and learning to ensure growth is sustainably

profitable. We now have a clearer understanding of the cost

of risk in Vehicle Finance, and established a robust post-

charge-off asset policy and debt sales programme.

We have delivered strong growth in Second Charge

Mortgages since the expanded launch in May 2024, with

interest earning balances over £200m, and strong growth

in savings, including an expansion into more flexible retail

notice and easy access products, with the Group now over

92% retail deposit funded (December 2023: 84%).

Costs were well controlled, including the delivery of greater

than £60m of committed transformation cost savings by the

end of 2024, while investing in the technology transformation

of the business via the Gateway programme.

The Group remains highly liquid and capital levels support

planned future growth.

Income statement

2024

£m

2023

(restated)

£m

Change

Interest income 565.4 556.0 2

Interest expense (145.4) (113.4) (28)

Net interest income 420.0 442.6 (5)

Non-interest income 38.5 46.2 (17)

Total income 458.5 488.8 (6)

Impairment charges (191.0) (165.5) (15)

Risk-adjusted income 267.5 323.3 (17)

Operating costs (403.8) (335.3) (20)

Statutory loss before tax (136.3) (12.0)

Tax credit 17.0 0.3

Statutory loss after tax (119.3) (11.7)

Add back:

Tax credit (17.0) (0.3)

Exceptional costs 24.1 21.4 (13)

Amortisation of

acquisition intangibles 6.2 7.9 22

Goodwill write-off 71.2 — (100)

Adjusted (loss)/profit before tax

(34.8) 17.3

Adjusted operating costs (302.3) (306.0) 1

Certain alternative performance measures (APMs) have

been used in this report. See pages 197 to 199 for an

explanation of their relevance as well as their definition.

In line with these changes, the Group has rationalised

its use of APMs, which are summarised on pages 197 to

199 including an explanation of their relevance as well as

their definition.

Income

Total income reduced 6% to £458.5m, driven by 4% lower

gross customer interest earning balances at £2,308m

and higher funding costs, partially offset by the benefit of

repricing initiatives in Credit Cards and Vehicle Finance, and

increased Liquid Asset Buffer income.

Net interest income decreased 5% to £420.0m. Within

this, interest income increased 2% to £565.4m driven by

repricing initiatives in Credit Cards and Vehicle Finance,

and increased Liquid Asset Buffer income. This was partially

offset by lower gross customer interest earning balances

and the mix effect of growing lower-risk and lower-margin

Second Charge Mortgages. Interest expense increased

28% to £145.4m, as maturing fixed-term deposits were

refinanced at higher current market rates.

NIM, calculated as net interest income as a percentage of

average gross interest earning receivables, decreased to

18.4% (2023: 18.6%). Excluding Second Charge Mortgages,

NIM was 18.9% (2023:18.6%), reflecting the benefit of the

repricing initiatives. Non-interest income reduced 17% to

£38.5m reflecting lower fee and commission income.

Governance Financial statementsStrategic report Shareholder information

Vanquis Banking Group plc Annual Report and Accounts 2024

Impairment

Impairment charges increased 15% to £191.0m reflecting the

impact of the Vehicle Finance Stage 3 receivables review

and the non-repeat of impairment releases in 2023. Credit

risk remained broadly stable in the underlying book.

Impairment charges driven by originations were £44.7m

lower year-on-year in line with reduced new business

volumes and credit risk in the underlying book improved

£27.7m driven by positive stage migrations.

2023 benefited from post-model adjustment and other

model redevelopment releases of £74.5m, which did not

repeat in 2024. This included provisions no longer required

in Credit Cards and Vehicle Finance, arising from IFRS 9

model refinements of £57.7m, and the full release of the

cost-of-living post-model adjustment of £10.8m.

The Vehicle Finance Stage 3 receivables review reduced

derecognition of Stage 3 interest by £17.6m and increased

write-offs by £21.9m following the establishment of the

Vehicle Finance post charge-off asset policy, resulting in a

much better performing portfolio.

The macroeconomic environment, the minimal impact

of the cost-of-living crisis and the growth in lower-risk

customer and product segments, such as Second Charge

Mortgages, meant underlying impairment remained benign,

with credit quality and delinquency trends broadly stable.

Cost of risk, calculated as impairment charges as a

percentage of average gross customer interest earning

balances, increased to 8.4% (2023: 7.0%).

Risk-adjusted margin, calculated as risk-adjusted income

as a percentage of average gross customer interest

earning balances, decreased to 11.7% (2023: 13.6%) as a

result of the reduced NIM and higher cost of risk.

Adjusted operating costs

Operating costs increased 20% to £403.8m including goodwill

write-off of £71.2m relating to the Moneybarn business, as the

Group prioritises capital deployment for growth into Second

Charge Mortgages and Credit Cards in the near-term.

Exceptional costs were £24.1m (2023: £21.4m), including

transformation costs of £21.1m (2023: £17.0m), comprising

redundancy and outsourcing costs of £9.7m (2023: £9.4m),

property exit costs of £3.5m (2023: £4.1m) and strategic

consultancy costs of £7.9m (2023: £3.5m).

Amortisation of acquisition intangibles reduced to £6.2m

(2023: £7.9m) following the completion of the Moneybarn

intangibles amortisation in August 2024.

Excluding exceptional costs, amortisation of acquisition

intangibles and goodwill write-off described above, adjusted

operating costs decreased 1% to £302.3m. This delivered an

adjusted cost: income ratio of 65.9% (2023: 62.6%).

Transformation cost savings increased £48.9m year on

year. When coupled with 2023 transformation cost savings

of £15.4m, £64.3m of savings were delivered by the end

of 2024, higher than the committed £60m. These savings

were largely offset by increased complaint costs of £20.9m

driven by higher FOS fees due to an increase in unmerited

claims received from CMCs, one-off items linked to the

comprehensive balance sheet review of £10.2m, and

increased costs linked to growth initiatives and inflation.

The Group has continued investment in the diversification of

customer propositions, and the technology and operations

investment associated with the Gateway technology

transformation programme. Cost management has been

embedded as a core discipline throughout the Group with

the transformation cost saving commitment increased

from £60m by the end of 2024 to £75m by the end of 2025,

reflecting an additional £15m of committed savings in

2025, and £23m-£28m of savings through the Gateway

programme in 2026 and 2027.

Loss before tax

The Group’s statutory loss before tax was £(136.3)m

(2023: £(12.0)m).

The Group’s adjusted loss before tax, excluding adjusting

items of exceptional costs, amortisation of acquisition

intangibles and goodwill write-off, was £(34.8)m

(2023: adjusted profit of £17.3m).

Tax

The tax credit of £17.0m (2023: tax credit of £0.3m) broadly

reflects the mainstream corporation tax rate of 25.0%

(2023: 23.5%) on the loss before tax of £(65.1)m excluding the

goodwill write-off of £(71.2)m, which was non-tax deductible.

The Group’s adjusted loss before tax generated a tax credit

of £10.0m (2023: tax charge of £5.9m), exceptional costs

generated a tax credit of £5.5m (2023: tax credit of £4.3m)

and amortisation of acquisition intangibles generated a tax

credit of £1.6m (2023: tax credit of £1.9m).

Loss after tax

The Group’s statutory loss after tax, including adjusting items

of exceptional costs, amortisation of acquisition intangibles

and goodwill write-off, was £(119.3)m (2023: £(11.7)m).

The Group’s adjusted loss after tax was £(24.8)m

(2023: adjusted profit of £11.5m).

Adjusted ROTE and EPS

The Group’s adjusted ROTE decreased to (7.0)% (2023: 1.9%)

and the adjusted basic EPS decreased to (9.7)p (2023: 4.5p)

per share, reflecting the adjusted loss before tax.

Summarised balance sheet

2024

£m

2023

£m

Change

Assets

Cash and balances at

central banks 1,004 743 35

Amounts receivable

from customers

2,154 2,156 —

Pension asset 28 38 (26)

Goodwill and other intangibles 63 147 (57)

Other assets 126 111 14

3,375 3,195 6

Liabilities

Retail deposits 2,428 1,951 24

Bank and other borrowings

410 583 (30)

Trade and other payables 46 44 5

Other liabilities 50 48 4

2,934 2,626 12

1 Amounts receivable from customers are presented net of £1m (2023: £3m)

fair value adjustment for portfolio hedged risk. Underlying net receivables

were £2,155m (2023: £2,159m).

2 Bank and other borrowings in 2024 are presented net of £3m (2023: £1m)

fair value adjustment for hedged risk. Underlying bank and other borrowings

were £413m (2023: £583m).

Financial review continued

Strategic report

Vanquis Banking Group plc Annual Report and Accounts 2024

Assets increased 6% to £3,375m driven by a 35% increase

in cash and balances at central banks to £1,004m, of which

£947m (December 2023: £682m) represented high quality

liquid assets (HQLA) placed with the Bank of England. This

was partially offset by a 57% reduction in goodwill and

other intangibles to £63m, driven by the goodwill write-off

of £(71.2)m relating to the Moneybarn business, as the

Group prioritises capital deployment for growth into Second

Charge Mortgages and Credit Cards in the near-term.

Amounts receivable from customers were stable at

£2,155m (December 2023: £2,159m), as a 12% reduction in

gross receivables to £2,416m driven by the Vehicle Finance

Stage 3 receivables review was offset by a commensurate

reduction in Expected Credit Losses (ECL) to £262m

(December 2023: £580m). Gross customer interest earning

balances decreased 4% to £2,308m, as reductions in Credit

Cards, Vehicle Finance and Personal Loans balances were

partially offset by growth in Second Charge Mortgages.

Liabilities increased 12% to £2,934m, as retail deposits

increased by 24% to £2,428m driven by growth in more

flexible retail notice and easy access accounts, partially

offset by a reduction in fixed-term products. This was partially

offset by a 30% reduction in bank and other borrowings to

£410m driven by the full repayment of Term Funding for SMEs

(TFSME) early given the strength of the deposit franchise.

Liquidity and funding

HQLA of £947m (December 2023: £682m) was almost

entirely held in the Bank of England reserve account. This

represented significant level of excess liquidity and a

liquidity coverage ratio of 359% (December 2023: 1,263%).

Retail deposit funding increased 25% to £2,399m and was

able to deliver the required funding base at an attractive

cost compared to wholesale alternatives. Within the retail

deposit base, fixed-term products reduced 25% to £1,415m

and were replaced by retail notice accounts of £608m

(December 2023: £42m) and easy access accounts of

£376m (December 2023: £nil). The Group is now significantly

funded by retail deposits, at 92.1% (December 2023: 83.7%)

of total funding.

Ongoing funding diversification is provided by modest

levels of private securitisation and Bank of England funding

collateralised by both Vehicle Finance and Credit Card

assets. The Group has no senior unsecured wholesale

funding, although maintains access to the wholesale

markets via a £2bn Euro Medium Term Note programme.

The Group’s cost of funds rose to 5.1% (December 2023: 4.4%),

as maturing fixed-term products, although reducing, were

refinanced at higher rates.

Capital

The Group maintains a robust capital position with a Tier

1 ratio of 18.8% (December 2023: 19.9%). This represents a

surplus of £99m of Tier 1 capital above the Group’s Tier 1

capital requirement and regulatory combined buffers of

13.4%. The 1.1% reduction in the Tier 1 ratio in 2024 was driven

by the statutory loss after tax for the year after adjusting

for goodwill and intangibles write-off and intangibles

amortisation, which are deducted from capital.

Risk weighted assets (RWAs) decreased to £1,835m

(December 2023: £1,976m), primarily reflecting the stable

net receivables balance being driven by lower risk weight

density Second Charge Mortgages, more than offset by

reductions in RWAs of higher risk weight density Credit

Cards, Vehicle Finance and Personal Loans receivables.

The Group’s leverage ratio of 13.9% (December 2023: 15.9%)

remains comfortably above the minimum requirement.

Pillar 3 disclosures

Pillar 3 disclosure requirements are set out within the

Disclosure (CRR) part of the PRA rulebook. The consolidated

disclosures of the Group, for the 2024 financial year, have

been issued concurrently with the Annual Report and

Accounts and can be found on the Group’s website,

www.vanquisbankinggroup.com.

Summary balance sheet and financial metrics

Balance Sheet

2024

£m

2023

(restated)

£m

Change

Gross customer interest

earning balances 2,308 2,401 (4)

Average gross customer

interest earning balances 2,286 2,376 (4)

Gross receivables 2,416 2,739 (12)

Net receivables 2,155 2,159 —

Closing tangible equity 359 394 (9)

Average tangible equity 377 418 (10)

Selected key metrics

2024

2023

(restated)

Change

Asset yield 22.7% 22.1% 0.6%

Net interest margin (NIM) 18.4% 18.6% (0.2)%

Total income margin (TIM) 20.1% 20.6% (0.5)%

Cost of risk (8.4)% (7.0)% (1.4)%

Risk-adjusted margin (RAM) 11.7% 13.6% (1.9)%

Adjusted cost: income ratio 65.9% 62.6% (3.3)%

Adjusted ROTE (7.0)% 1.9% (8.9)%

Selected per share metrics p p %

Adjusted basic earnings

per share (9.7) 4.5

Dividend per share — 6.0 (100)

Tangible Net Asset Value

(TNAV) per share 140 155 (10)

Capital, liquidity and funding metrics

2024

2023

(restated)

Change

Tier 1 ratio 18.8% 19.9% (1.1)%

Risk weighted assets (RWA) (£m)

1,835 1,976 (7)%

High quality liquid assets

(HQLA) (£m) 947 682 39%

Liquidity coverage ratio (LCR) 359% 1,263%

Dave Watts

Chief Financial Officer

13 March 2025

Governance Financial statementsStrategic report Shareholder information

Vanquis Banking Group plc Annual Report and Accounts 2024

Operating review

Product trading performance

Detailed analysis of the product contribution to the trading results of the Group can be found on page 39 for Credit Cards,

page 40 for Vehicle Finance, page 41 for Second Charge Mortgages, page 42 for Personal Loans, and page 43 for Corporate

Centre including Snoop.

Segment analysis – Adjusted product contribution

2024

£m

Credit

Cards

Vehicle

Finance

Second

Charge

Mortgages

Personal

Loans

Corporate

Centre

incl. Snoop Total

Interest income 406.3 133.1 4.8 15.4 5.8 565.4

Interest expense (79.6) (38.5) (2.9) (3.4) (21.0) (145.4)

Net interest income 326.7 94.6 1.9 12.0 (15.2) 420.0

Non-interest income 35.3 — — — 3.2 38.5

Total income 362.0 94.6 1.9 12.0 (12.0) 458.5

Impairment charges (123.9) (60.4) (0.2) (5.7) (0.8) (191.0)

Risk-adjusted income 238.1 34.2 1.7 6.3 (12.8) 267.5

Adjusted operating costs

(185.3) (42.2) (0.2) (10.5) (64.1) (302.3)

Adjusted PBT/(LBT) 52.8 (8.0) 1.5 (4.2) (76.9) (34.8)

2023 (restated)

£m

Credit

Cards

Vehicle

Finance

Second

Charge

Mortgages

Personal

Loans

Corporate

Centre

incl. Snoop Total

Interest income 371.0 150.3 0.4 25.9 8.4 556.0

Interest expense (51.6) (28.7) (0.2) (4.0) (28.9) (113.4)

Net interest income 319.4 121.6 0.2 21.9 (20.5) 442.6

Non-interest income 43.8 2.0 — — 0.4 46.2

Total income 363.2 123.6 0.2 21.9 (20.1) 488.8

Impairment charges (125.5) (20.4) — (19.6) — (165.5)

Risk-adjusted income 237.7 103.2 0.2 2.3 (20.1) 323.3

Adjusted operating costs

(172.3) (51.9) (0.7) (17.3) (63.8) (306.0)

Adjusted PBT/(LBT) 65.4 51.3 (0.5) (15.0) (83.9) 17.3

1 Adjusted operating costs are stated before exceptional items, amortisation of acquisition intangibles and goodwill write-off.

Credit Cards – Proactive volume management in 2024, positioned for profitable growth

in 2025

The Group’s Credit Cards business is a leading player in the

non-prime Credit Card market. In 2023 and 2024, Vanquis

received the Moneyfacts Consumer Award for Best Credit

Builder Card Provider of the Year.

The business offers credit card products to a broad

spectrum of customers but is focused particularly on

providing access to credit card customers who may

struggle to obtain one from a mainstream provider.

Customers are offered four different credit card products

– the Credit Builder Card, Balance Transfer Card, Purchase

Card or Balance Transfer and Purchase Card.

Vanquis Trustpilot rating:

4.2*

Customers are supported through great service whether

it be in app or via our customer service teams. From a

service rating perspective, Vanquis Credit Cards is rated

Great on Trustpilot, based on over 36k reviews. We aim to

make our customer experience effortless, and these results

demonstrate the progress we have made.

Strategic report

Vanquis Banking Group plc Annual Report and Accounts 2024

12 months ended 31 December

2024

£m

2023

(restated)

£m Change

Total customer numbers (’000) 1,267 1,376 (8)%

Gross customer interest

earning balances 1,278 1,424 (10)%

Average gross interest

earning balances

1,313 1,416 (7)%

Gross receivables 1,310 1,475 (11)%

Net receivables 1,150 1,278 (10)%

Interest income 406.3 371.0 10%

Interest expense (79.6) (51.6) (54)%

Net interest income 326.7 319.4 2%

Non-interest income 35.3 43.8 (19)%

Total income 362.0 363.2 —

Impairment charges (123.9) (125.5) 1%

Risk adjusted income 238.1 237.7 —

Adjusted operating costs

(185.3) (172.3) (8)%

Adjusted PBT contribution

52.8 65.4 (19)%

Asset yield

27.9% 24.7% 3.2%

Net interest margin

24.9% 22.6% 2.3%

Total income margin

27.6% 25.7% 1.9%

Cost of risk

(9.4)% (8.9)% (0.5)%

Risk adjusted margin

18.1% 16.8% 1.3%

Financial performance

Total customer numbers decreased 8% to 1,267k reflecting

a comprehensive review of customer cohorts by risk

profile, vintage and acquisition channel. This review drove

proactive volume management and as a result, growth

actions were moderated to ensure the future sustainable

profitability of the portfolio.

Credit Cards – Proactive volume management in 2024, positioned for profitable growth

in 2025 continued

Great service, good starter card.

Very happy with the app, I’ve never

had any problems, just had a

balance transfer that’s saved

me a good amount of interest!”

Vanquis customer

Period-end gross customer interest earning balances

decreased 10% to £1,278m and period-end net receivables

decreased 10% to £1,150m.

Total income was stable at £362.0m (2023: £363.2m), with

net interest income increasing 2% to £326.7m and non-

interest income decreasing 19% to £35.3m. Net interest

margin increased 2.3% to 24.9% and total income margin

increased 1.9% to 27.6%.

Interest income increased 10% to £406.3m driven by the

improvement in asset yield from repricing initiatives, which

increased 3.2% to 27.9%, and increased Liquid Asset Buffer

income. This was partially offset by the reduction in gross

customer interest earning balances.

Interest expense increased 54% to £79.6m, as market

savings rates remained elevated and customers with

maturing fixed-term products moved onto higher yielding

products, impacting the Group’s funding cost.

Impairment charges reduced marginally to £123.9m (2023:

£125.5m), reflecting lower origination charges in line with

reduced new business volumes. Underlying credit quality

improved year on year. Impairments in 2023 benefited from

a £17.0m release of post-model adjustments following IFRS 9

model enhancements and the full release of the £10m cost-

of-living post-model adjustment. Cost of risk increased to

9.4% (2023: 8.9%).

Risk-adjusted income was stable at £238.1m (2023: £237.7m)

with an increased risk-adjusted margin of 18.1% (2023: 16.8%).

Adjusted operating costs increased 8% to £185.3m, driven

by the significant increase in complaint costs from FOS

fees related to a rise in unmerited claims from CMCs.

Transformation savings were partially offset by inflation and

investment in the business.

Adjusted PBT contribution was £52.8m (2023: £65.4m).

1 Average of gross customer interest earning balances for the 12 months

ended 31 December using a 13-point month end average.

2 Adjusted operating costs are stated before exceptional items

and amortisation of acquisition intangibles.

3 Adjusted PBT contribution is stated as profit before tax before exceptional

items and amortisation of acquisition intangibles.

4 Interest income from customer receivables for the 12 months ended

31 December as a percentage of average gross customer interest

earning receivables.

5 Net interest income for the 12 months ended 31 December as a percentage

of average gross customer interest earning receivables.

6 Total income for the 12 months ended 31 December as a percentage of

average gross customer interest earning receivables.

7 Impairment charges for the 12 months ended 31 December as a percentage

of average gross customer interest earning receivables.

8 Total income less impairment charges for the 12 months ended 31 December

as a percentage of average gross customer interest earning receivables.

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Vanquis Banking Group plc Annual Report and Accounts 2024