Vanquis Banking Group plc

Annual Report and Accounts

for the year ended 31 December 2025

Delivering caring

banking so our

customers can make

themost of life’s

opportunities

Our purpose is to

deliver caring banking

so our customers can

make the most of

life’s opportunities

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

different people. It might be borrowing for a car when it matters most,

improving a credit score to unlock better options, or simply feeling

more in control during tighter months. Our role is to support customers

with care and clarity at every stage of their journey.

Strategic report

1 Headlines

2 Who we are

4 Chairman’s statement

7 Chief Executive Officer’s

review

10 Market overview

14 Strategy

16 Business model

18 Key Performance Indicators

21 Sustainability

44 Financial review

47 Operating review

52 Section 172(1) statement

53 Non-financial and

sustainability information

statement

54 Risk management and

principal risks

57 Principal risks and

uncertainties

62 Viability statement

Governance

64 Chairman’s introduction

togovernance

66 Board of Directors

68 Division of responsibilities

70 Setting our strategy

71 Promoting long-term

sustainable success: Board

focus areas during 2025

73 The Board: our culture

74 Stakeholder engagement

and decision making

79 Composition, succession

and evaluation

80 Director induction and

training

81 Board Performance Review

84 Nomination and Governance

Committee Report

86 Audit Committee Report

91 Risk Committee Report

95 Directors’ Remuneration

Report

95 Annual Statement

by the Chair of

the Remuneration

Committee

98 Remuneration at

aglance

100 Vanquis Banking

Group plc Directors’

Remuneration Policy

2026 to 2029

109 Annual Report on

Remuneration

118 Additional remuneration

disclosures

123 Directors’ Report

Financial statements

129 Independent auditor’s

report

137 Consolidated income

statement

137 Consolidated statement of

comprehensive income

137 Earnings per share

137 Dividends per share

138 Balance sheets

139 Statements of changes

inequity

141 Statements of cash flows

142 Material accounting policy

information

152 Financial and capital risk

management

156 Notes to the financial

statements

196 Alternative performance

measures

Shareholder information

199 Information for

shareholders

Our purpose

Delivering

caringbanking

Customers are at the

heart of everything

we do. Caring

banking means that:

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

Our ambition

Helping customers

on the path to

financial resilience

Striving to become

theUK’s most trusted

and inclusive specialist

bank will enable

Vanquis to unlock

financial opportunity

for underserved

customers and help

them thrive.

Our values

Our values in action

Our values and ACT

Culture (Ambitious,

Caring, Together),

guides our decision

making and how we

work with 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

Serve More,

ServeResponsibly,

Scale Profitably.

Our strategy guides

how we deliver on our

purpose and ambition,

balancing wider access

to credit with strong

customer outcomes,

disciplined risk

management and

sustainable returns.

Read more on page 14 Read more on page 14 Read more on page 73 Read more on page 14

Find out more on our website:

vanquis.com/investors

1 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Headlines

Customer proposition

Credit, savings and money management products

Credit Savings Money management

Credit

Cards

Vehicle

Finance

Second Charge

Mortgages

Savings Snoop

Number of customers

1,339k

FY24: 1,267k

103k

FY24: 110k

9.9k

FY24: 3.7k

81k

FY24: 57k

328k

FY24: 293k

Gross customer interest earning balances Retail deposits

£1,518m

FY24: £1,278m

£706m

FY24: £765m

£599m

FY24: £217m

£2,984m

FY24: £2,399m

In 2025, Vanquis Banking Group returned to

profitability, strengthened its balance sheet

andadvanced its strategic priorities.

Backed by strong credit quality, disciplined

costcontrol, and continued transformation,

theGroup delivered accelerated growth

ininterest-earning balances, strengthening

itsplatform for long-term value creation.

With a clear strategy, focused execution

andanexperienced leadership team,

Vanquisiscreating enduring value for

customers, colleagues and shareholders.

Cost: income

58.4%

FY24: 89.4%

Statutory ROTE

2.3%

FY24: (32.1)%

Net interest margin

16.8%

FY24: 18.5%

Common Equity Tier 1 ratio

16.5%

FY24: 18.8%

Gross customer interest-earning

balances (£m)

Retail deposits (£m)

Gross customer interest-earning balances composition (£m)

Credit Cards 54%

Vehicle Finance 25%

Second Charge Mortgages 21%

Cards 55%

Vehicle Finance 33%

Second Charge Mortgages 9%

Loans 3%

FY25

£2,824m

Secured: 46%

Unsecured: 54%

Secured: 43%

Unsecured: 57%

FY24

£2,308m

FY24

2,308

24%

22%

2,399

FY25

2,824

2,984

FY24 FY25

2025: Building

thefoundations

forsustainable,

profitablegrowth

2 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Who we are

Our business model and core propositions

We combine deep customer insight, disciplined risk management, efficient funding and modern digital capabilities

to serve customers responsibly and deliver sustainable returns.

Credit Savings Money management

How we create value:

We put our customers at the heart

of everything we do.

We create differentiated solutions

that meet customer needs.

We meet customers where

theyareon their financial journey.

We serve customers

efficientlyandconsistently.

We create sustainable value for all

our stakeholders.

Our ESG priorities

Vanquis Banking Group is a specialist bank with a strong social purpose, focused

onwidening access to credit for customers underserved by mainstream lenders

Customers Colleagues

Communities The environment

Our customers’ core needs

Help me borrow healthily Help me build a financial safety net Help me feel in control of my everyday spending

Our purpose

To deliver caring banking so our customers

can make themost of life’s opportunities.

Read more on page 16

Our ambition

To be the UK’s most trusted and inclusive

specialist bank by unlocking financial

opportunity for underserved customers and

helping them thrive.

Our strategy

Serve More,

Serve Responsibly,

ScaleProfitably.

3 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Who we are continued

Vanquis

The bank that’s got your back.

Find out more on our website:

vanquis.com

Our customer proposition

Credit Cards

We provide Credit Cards tailored to

customerneeds, offering a range of APRs

andcredit limits.

Vehicle Finance

We finance used vehicles through Conditional

Sale Agreements with fixed APRs.

Second Charge Mortgages

Through partnerships we enable homeowners

to borrow against their property.

Savings

We offer a range of competitive, easy-to-

manage savings accounts.

Snoop

Snoop leverages AI and Open Banking to help

customers save on household bills, targeting

upto £1,500 in annual savings.

The Vanquis Card helped me get

my credit score back to normal.”

Vanquis customer

An absolute game changer

for managing my finances

all in one place!”

Snoop customer

The greatest experience ever.

Theprocess was smooth and

straightforward – completely

hassle-free. You apply today

anddrive in a couple of days.

I’drecommend Moneybarn

toeveryone!”

Moneybarn customer

Brilliant app to use – great

forbudgeting. I would highly

recommend it.”

Snoop customer

I got financial support

when I most needed it.”

Vanquis customer

Excellent upgrade! The new

app isclean and modern and

makes navigating my account

details effortless.”

Vanquis customer

4 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Chairman’s statement

Building a

leading bank for

customers who

need us most

Sir Peter Estlin

Chairman

Overview

Over the past two and a half years as

Chairman, I have worked closely with the

Boardand executive team to guide the business

through a period of significant change and

transformation, ensuring the Group remained

focused on its strategic priorities and stayed

true to our purpose: to deliver caring banking

soour customers can make the most of

life’sopportunities.

I am pleased to report that in 2025 the Group

returned to statutory profitability, strengthened

its balance sheet and delivered accelerated,

disciplined growth. Vanquis now serves 1.77

million customers and is building a purpose-led,

technology-enabled bank with increasing

resilience and scale. With approximately half

ofUK adults with an active credit profile

underserved, the need for fair and accessible

financial services has never been greater. This

structural market dynamic presents a compelling

long-term opportunity for Vanquis, guided by

responsible lending, prudent capital deployment

and a clear focus on improving financial

resilience across the UK.

Strategic transformation

Having built strong foundations in 2024, 2025

marked a decisive shift from stabilisation to

delivery as we embedded our customer-led,

needs-driven strategy across the Group. We

committed to reducing costs, strengthening risk

management and driving resilient returns; and

we delivered.

The Group simplified products, enhanced

affordability assessments and expanded support

for customers seeking to regain control of their

finances, helping them borrow responsibly and

manage their money with greater confidence.

Atthe same time, we progressed the Gateway

technology programme, which is already

delivering benefits and will underpin future

scale, efficiency and stronger operational

control. Collectively, these developments were

instrumental in supporting the Group’s return

tostatutory profitability.

In UK retail banking, Vanquis stands apart by

focusing on customers often excluded by high

street lenders. Unlike many mainstream banks

that compete primarily for the strongest credit

profiles, Vanquis serves customers on a journey,

helping them access credit responsibly and build

financial resilience over time. This perspective

underpins our refreshed brand, new technology

platform and mobile app, and remains central

to our ambition to be a purpose-led specialist

bank for underserved customers.

With a more efficient, resilient and customer-

focused operating model, the Group enters 2026

with growing momentum and a clear path to

long-term value creation for shareholders.

Strategic priorities

Our strategy is to build a resilient, efficient and

scalable business that delivers strong returns

while widening access to credit for the UK’s

large and structurally underserved population.

In 2025, we embedded the strategic articulation

‘Serve More, Serve Responsibly, Scale Profitably’,

providing a clear framework for disciplined

execution and capital allocation.

5 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Chairman’s statement continued

Strategic priorities continued

We will continue to optimise our product mix,

maintain credit quality and harness advanced

data, Open Banking and our Gateway platform

to enhance decisioning, control and affordability

outcomes. Backed by a growing digital ecosystem,

a digital-first ambition and disciplined capital

deployment, the Group is well positioned to

grow in attractive markets where our share

remains modest.

This strategy is designed to deliver income

growth, minimal cost inflation, rising capital

generation and returns on tangible equity

consistently above our cost of capital. As the

portfolio matures and operating leverage builds,

returns will strengthen, giving the Group

flexibility to accelerate growth or increase

shareholder distributions over time.

Under Ian McLaughlin’s leadership, Vanquis

moves into the next phase of its evolution from

aposition of strength, underpinned by robust

risk management, improving returns and a clear

purpose focused on serving the UK’s underserved

population. While approximately half of UK

adults with an active credit profile face barriers

to mainstream credit, Vanquis currently serves

only a small proportion of this sizeable and

persistent market, presenting a significant

long-term opportunity.

Our priorities centre on broadening access to

credit across channels, optimising capital

deployment and gradually shifting towards

lower-risk segments such as Second Charge

Mortgages. While this will naturally moderate

net interest margin over time, the Board believes

it will deliver stronger risk-adjusted returns,

improved credit quality and a more resilient

business model.

Gateway and Snoop are transforming how we

manage risk, deepen customer relationships and

deliver better outcomes. As Gateway completes

in 2026, these capabilities will increase efficiency,

strengthen controls and support higher capital

generation, reinforcing the Group’s ability to

generate durable, long-term value.

For more information see Strategy and Market

Overview on pages 10 to 15

Commitment to customers

Our customers rely on us because they are often

not well served by high street lenders, and we

take that responsibility seriously. Their needs are

evolving and meeting them with fairness and

clarity remains central to our purpose.

That commitment is reflected in our customer

satisfaction score of 83.7, ahead of the industry

average of 81.1. This level of advocacy

strengthens the foundations on which we are

building a more scalable and resilient bank, and

we will continue to invest in enhancing customer

experience as we grow.

Industry developments

The Supreme Court’s ruling on motor finance

commission disclosures provided welcome clarity

for the industry. The FCA’s subsequent consultation

on motor finance redress (CP25/27) prompted

the Group to recognise a £3.0m provision based

on probability-weighted scenarios.

Vanquis did not operate discretionary or tied

commission arrangements, and our approach

has always been grounded in transparent

customer disclosures and responsible lending.

We engaged constructively with the FCA

throughout the consultation, emphasising the

need for a fair and proportionate approach

that differentiates between business models.

Financial inclusion

The Government’s Financial Inclusion Strategy,

published in November, reinforced what we have

long believed: that access to fair, transparent

and well-designed financial products is

fundamental to opportunity. As a bank with

purpose at its core, Vanquis is well placed to

contribute positively to this agenda, helping

people build financial confidence, access fair

credit and participate fully in the economy.

Capital management and

shareholder distributions

In 2025, we allocated capital to support profitable

growth in customer interest-earning balances. The

successful £60m issuance of Additional Tier 1 (AT1)

Notes in October further optimised our capital

structure to support growth.

With this priority, the Board has decided not to

declare a dividend for FY25 (2024: no dividend).

The Board expects to continue deploying

capitalfor growth in the near term and intends

to reset the capital allocation framework and

distribution policy following full delivery of the

strategy in 2026.

Building a strong culture

Our cultural transformation has been as

important as our technological and financial

transformation. In 2025, we introduced our ACT

Culture (Ambitious, Caring and Together) to

reinforce the Values needed for a modern,

customer-led bank. Our ACT Culture and

Valuesare now becoming firmly embedded

across the organisation, strengthening

accountability, collaboration and customer

focus. Culture is increasingly a clear enabler

ofour strategy and a critical foundation

forthenext phase of growth.

We continued to invest in our communities,

signing the Armed Forces Covenant, supporting

Bradford’s City of Culture programme and

advancing social mobility through the Vanquis

Foundation. We remain committed to a workplace

where colleagues can grow, celebrate success

and contribute to delivering caring banking.

Our remuneration framework continues to

reinforce alignment between performance,

riskand sustainable shareholder returns.

For more information see pages 95 to 122

Governance and directors

Following the Board refresh in 2024, Paul Hewitt

and Angela Knight retired from the Board in

January 2025. The composition of the Board has

remained unchanged since their departure. The

current Board brings extensive expertise across

banking, financial services, governance and risk

management, ensuring strong oversight and

constructive challenge as the Group delivers on

its strategic objectives. I would like to thank my

fellow Board members for their engagement,

challenge and insight throughout the year.

6 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Chairman’s statement continued

Independent Board evaluation

An independent external evaluation

conductedin 2025 by Independent Audit

concluded that financial oversight, risk

management and stakeholder consideration

were notable Board strengths, facilitated by

astrong committee structure and approach

tocontinuous development.

There was an overarching theme of a

much-improved position, combined with an

acknowledgement that key development areas

remained, in particular for the Board to step back

from operational detail and increase its strategic

focus, within the context of the Group’s return to

profitability after a challenging period. The Board

has agreed an action plan and will monitor

progress during 2026.

For more information see pages 82 and 83

Summary

We are encouraged by the Group’s progress

in2025. Returning to profitability,strengthening

the balancesheetand deliveringstrong but

controlledgrowthreflect significant effort across

the organisation. As we move into 2026, the

Board’s confidence is grounded inclear

evidenceof progress and delivery, supported

bya modern, scalable technology platform

andeffective credit risk management.

On behalf of the Board, I thank our colleagues

for their dedication and our shareholders for

their continued confidence. Vanquis has a clear

and disciplined strategy and is well positioned

to deliver enduring growth and long-term value,

while continuing to support customers who need

us most.

Sir Peter Estlin

Chairman

25 February 2026

Capital management

Management and the Board endeavour to optimise the allocation of capital in the long-term

best interests of the Group. This near-term focus of the Board is on the following two areas:

Ensuring the Group maintains a robust capital position

above its regulatory minimum requirements*

The Group has updated its capital guidance to a Common Equity

Tier 1 (CET1) ratio following capital optimisation executed in 2025.

This included the issuance of £60m of AT1 capital in 4Q25, meaning

the Group is no longer bound by Tier 1 capital requirements.

Capital guidance has been reducing in recent years, reflecting

acleaner and more stable financial position and lower-risk mix

ofbusiness. The Group’s capital requirements were also reviewed

by the PRA in 2H25 as part of the triennial CSREP review.

This has given management and the Board confidence to

reduce the Group CET1 ratio guidance to >14.5%.

This guidance remains subject to changes in regulatory

requirements.

December 2025 CET1 ratio:

16.5%

CET1 ratio guidance:

>14.5%

Driving long-term sustainable profitable growth

Vanquis continues to build scale in the near term todeliver

itsROTE guidance of low double digits in 2026 and mid-teens

in2027, at which point the Group becomes meaningfully

capitalaccretive.

As such, following capital deployment for growth in 2025

resulting in a 22% increase in gross customer interest-earning

balances to £2,824m, the Group is guiding to >£3.3bn of

balances in 2026 and >£3.7bn of balances in 2027.

* This includes confidential and management buffers, as appropriate.

December 2025 gross

customer interest-

earningbalances:

£2,824m

2026 guidance:

>£3.3bn

2027 guidance:

>£3.7bn

The Board intends to reset the capital allocation framework and distribution policy following

full delivery of the strategy in 2026.

7 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Chief Executive Officer’s review

Introduction

2025 marked a significant milestone for Vanquis.

The Group returned to statutory profitability

andwe demonstrated that our transformation

isdelivering results, with strong but disciplined

growth in interest-earning balances, strong and

resilient credit quality, continued progress on

Gateway and tight cost control. Most importantly

we continued improving our customer experience.

This performance reflects the disciplined

execution of our strategy to build a scalable,

digital-first and customer-led bank. With strong

foundations now in place, we are focused on

sustained, profitable growth that creates

long-term value for customers, colleagues

andshareholders.

Customer proposition

In 2025, we strengthened and diversified our

customer proposition, reflecting our commitment

to help customers borrow responsibly, manage

money confidently and build financial resilience.

This sits at the heart of our ‘Serve Responsibly’

pillar, ensuring access to credit is balanced with

strong affordability, good customer outcomes

and long-term portfolio quality, while enabling

us to ‘Serve More’ customers who are

underserved elsewhere.

We continued to help customers build a

healthier relationship with credit. Credit Card

balances grew 19% to £1,518m, supported by

new product launches, higher utilisation from

existing customers and strong retention. This

growth was achieved within risk appetite,

underpinned by enhanced affordability

assessments, resilient margins and consistently

strong credit performance. Vanquis was

recognised at the 2025 Moneyfacts Consumer

Awards as Credit Builder Card Provider of the

Year and Credit Card App of the Year, reflecting

the trust customers place in our propositions

and brand.

In Vehicle Finance we reduced balances in line

with our plan ahead of the launch of our new

onboarding and servicing platform as part of the

Gateway transformation in 2026. This deliberate

moderation reflects a disciplined approach to

growth as we prepare to scale on a modernised

platform. Many of our Vehicle Finance customers

come to us for access to a reliable vehicle when

it matters most, and we continue to enhance our

credit decisioning capabilities to improve the

speed, accuracy and consistency of lending

decisions while lending responsibly.

Our Second Charge Mortgages proposition,

which our customers mainly use for debt

consolidation, continued to perform strongly.

Balances increased to £599m (December 2024:

£217m), supported by long-term origination

partnerships that deliver high-quality,

predictable growth and attractive returns.

Retail deposits remain the cornerstone of our

funding strategy. During the year we broadened

our Savings product suite with the addition of ISAs

and the Snoop-branded Easy Access account,

further strengthening our stable and cost-efficient

funding base. Vanquis was recognised at the 2025

Moneyfacts Awards as Best Notice Savings

Account Provider and received Highly Commended

in the Best Monthly Savings Account and Best

Bank Savings Provider categories, underlining

the strength of our proposition.

Snoop continues to play a vital role in our customer

ecosystem, with active users rising 12% to 328k,

including 43k Vanquis customers. The platform

deepens engagement, supports financial wellbeing

and serves as an efficient acquisition channel.

During the year, Snoop introduced Variable

Recurring Payments to make saving simpler and

more flexible and was named in the FinTech 50 as

one of the UK’s most innovative financial technology

creators for 2025. The business also received

recognition for Best Innovation in Product at

TheFinancial Services Forum Awards and was

aFinalist for Best Use of Technology in Personal

Finance at the Moneyfacts Awards.

For more information see the Operating Review

onpages 47 to 51

Ian McLaughlin

Chief Executive Officer

The foundations

for sustainable,

profitable growth

8 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Chief Executive Officer’s review continued

Financial inclusion

At Vanquis, financial inclusion and opportunity go

hand in hand. Our partnership with Fair Finance,

part of our ‘not yet’ approach to credit, helps

customers who are not currently eligible for our

products access affordable loans and unclaimed

benefits. Together, we have supported 20k

people to identify £34m in entitlements and

access £307k in loans.

Ahead of the Government’s Financial Inclusion

Strategy announced in November, we launched

the Vanquis Benefits Checker, a digital tool that

helps customers find unclaimed benefits and

social tariffs. By helping customers maximise

income before borrowing, these initiatives

strengthen financial resilience and reduce

reliance on credit, reinforcing our commitment

toresponsible inclusion.

Customer feedback

Customer feedback is the clearest reflection

ofour purpose: “delivering caring banking”.

Across Vanquis, Moneybarn and Snoop,

thousands of customer reviews highlight how

wehelp people rebuild credit and access fair,

affordable finance when it matters most. In

2025, we introduced a new customer satisfaction

measure, giving us a consistent, data-driven

view of customer experience and enabling us to

track progress as we evolve our products and

services. Our satisfaction score, measured in

partnership with the Institute of Customer

Service, stands at 83.7, ahead of the industry

average of 81.1. We will continue to build on this

validation and strive to deliver even better

outcomes for our customers.

Financial performance

Gross customer interest-earning balances

increased 22% to £2,824m, ahead of our

guidance, reflecting disciplined lending with

strong credit quality. Risk-adjusted income rose

5% to £273.8m, supported by a lower cost of

riskof 7.3% (2024: 8.4%). The cost-to-income

ratio improved to 58.4% (2024: 89.4%) through

transformation savings, efficiency gains, reduced

complaint costs and the non-repeat of prior

year notable items. As a result, the Group

delivered a statutory profit before tax from

continuing operations of £8.3m (2024: loss of

£138.0m) and achieved a statutory return on

tangible equity of 2.3% (2024: (32.1)%).

For more information see the Financial Review

onpages 44 to 46

Technology, operational efficiency

and risk management

Technology and data remain central to our

strategy. During 2025, we made significant

progress on the Gateway transformation,

selecting Fiserv’s Vision Next platform to support

a scalable, cloud-based infrastructure. Our

partnership with Zoot was recognised with the

Best Technology Partnership Award, reflecting

the impact of advanced decisioning on speed,

accuracy and customer outcomes.

Building on the risk management enhancements

made in 2024, we further strengthened data

and analytics capabilities, enhancing portfolio

monitoring, credit risk decisioning and affordability

assessments. These improvements are supporting

better decision making, tighter risk control and

responsible growth at scale. Gateway is a core

enabler of this, providing the modern operating

platform required to deliver productivity,

efficiency and capital accretion over time.

During the year, over 30 billion rows of customer,

product and decisioning data were migrated

toa new IT platform as part of Gateway,

enabling improved analytics, automation and

personalisation across customer journeys.

Across operations, digital and AI-led

improvements in fraud prevention, debt sales

and complaints handling delivered measurable

efficiency gains and better outcomes for

customers. Combined with a leaner property

footprint, these initiatives contributed to £28.8m

in transformation savings during the year.

Vanquis: The bank that’s got your back

In June, we launched our refreshed brand

identity, Vanquis: The bank that’s got your back.

Developed in house and successfully tested with

customers, it brings our purpose to life and

reflects our commitment to caring banking and

the financially underserved. Together with our

technology transformation, it positions Vanquis

as a modern, customer-led specialist bank

serving the heart of working Britain.

Complaints and regulatory update

We welcomed the Financial Ombudsman

Service’s introduction of a case-fee structure

forclaims management companies (CMCs).

Thereform has had a clear and positive impact,

reducing the volume of unmerited complaints,

indicating that the reform is working as intended.

We engaged constructively with the FCA’s

consultation on motor finance redress (CP25/27),

helping to shape a fair and proportionate

approach that reflects the low risk of detriment

in our portfolio. While the final scope of the

scheme remains subject to change, we remain

comfortable with our £3.0m provision in relation

to this matter.

Our people and culture

As Peter notes, we have made good progress

with culture, and our achievements in 2025 were

made possible by the professionalism and

efforts of colleagues across the Group. Our ACT

Culture (Ambitious, Caring and Together) and

Values are now shaping how we work and

reinforcing the execution discipline required to

deliver a modern, customer-led bank.

Our progress is underscored by us achieving

Great Place to Work

certification in 2025,

reflecting the commitment we made last year to

strengthen culture across the Group. We were

also recognised by the Financial Times as one of

the UK’s Best Employers, demonstrating deeper

engagement and alignment with our purpose.

As we move into the next phase of our strategy,

we will continue to embed our values deeply,

ensuring they guide decisions and drive

sustainable growth.

Advancing our strategic priorities

In 2026, we will complete the Gateway

transformation and re-platform the business

onto a modern, cloud-based architecture.

Thiswill enable a digital-first operating model,

accelerate innovation and deliver a structurally

lower cost base.

We will broaden our offering across lending,

money management and savings, creating a

more integrated digital customer experience.

This will include new flexible credit solutions,

tailored propositions for different customer

segments and deeper personalisation.

We will further enhance credit decisioning

through improved data, analytics and

automation, strengthening our ability to lend

responsibly while improving outcomes for

customers. Gateway will provide real-time

insights and more accurate affordability

assessments across all products, including

atransformed Vehicle Finance proposition

launching in 2026. In addition, we are

introducing Agentic AI capabilities to deliver

faster, more efficient support, enhancing

servicewhile reducing cost-to-serve.

Together, these initiatives will support growth,

improve retention and drive stronger returns

across the business.

9 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Chief Executive Officer’s review continued

Summary and outlook

Disciplined delivery of our strategy in 2025

enabled us to deploy available capital to deliver

accelerated balance growth while returning to

statutory profitability. We strengthened the

balance sheet, improved credit quality and

made significant progress in our transformation,

laying the foundations for long-term scalability

and efficiency.

We enter 2026 with greater momentum, a more

predictable performance profile and a clear

pathway to higher returns as recent balance

growth seasons and translates into improved

profitability. Our focus remains on completing

the Gateway transformation, maintaining strong

credit discipline, deploying capital effectively

and improving operational efficiency.

We remain on track to deliver a double-digit

return on tangible equity in 2026, and mid-teens

return in 2027. While encouraged by our

progress, we recognise there is still more to do.

We will continue to invest in our capabilities,

drive continuous improvement and remain

mindful of the responsibility we hold to

customers, colleagues and shareholders.

I would like to thank our shareholders for their

trust and our colleagues across the Group for

their care, skill and commitment. Together, we

are building a stronger, more resilient Vanquis

with a clear purpose and a compelling future.

Ian McLaughlin

Chief Executive Officer

25 February 2026

Investment case

Our strategy is guided by a clear understanding of what sets us apart and how we will harness these strengths to deliver growth and sustainable profitability.

What sets us apart

Serving customers in a large, underserved part of the UK consumer lending market

Over half of UK adults face barriers to mainstream credit. Vanquis has a significant

opportunity to grow market share of these consumers in our core products and is digitally

evolving and expanding our product propositions to attract and retain customers.

Read more on pages 14 to 20

2027 gross customer interest

earning balance guidance

>£3.7bn

2027 ROTE guidance

‘mid-teens’

10 – Vanquis Banking Group plc Annual Report and Accounts 2025

Strategic report Shareholder informationFinancial statementsGovernance

UK economy

Market overview

Operating context

Vanquis operates exclusively within the

UnitedKingdom (UK), generating all revenue

from UK customers. As a result, the Group’s

performance is closely tied to the health of

theUK economy. The Group operates within

aregulatory framework overseen by the

Financial Conduct Authority (FCA) and the

Prudential Regulation Authority (PRA), which

continues to evolve in response to economic

and policy developments.

Economic review

In 2025, UK economic growth remained

subdued, with real GDP rising by just 0.1% in

the three months to December, following small

declines in the previous two rolling quarters.

Monetary policy continued to shape financial

conditions, with the Bank of England reducing

the Bank Rate from 4.75% to 3.75% over the

course of the year through a sequence of cuts

in February, May, August and December.

Inflation continued to moderate from its

October 2022 peak of 11.1%, with the Consumer

Prices Index (CPI) easing from 3.7% in January

2025 to 3.4% in December. Labour market

conditions also softened, with unemployment

rising to 5.2% in the three months to December,

its highest level in five years. Real household

disposable income growth was uneven, with

middle income households continuing to face

pressure from rising essential costs.

Looking ahead to 2026, the economic outlook

is expected to improve gradually. Forecasters

anticipate GDP growth of around 1.4%,

supported by easing financial conditions and

stabilising consumer sentiment. Inflation is

projected to fall further, with CPI expected to

average 3.4%, helping real incomes recover

modestly. Labour market conditions are likely

to remain cooler than in recent years, with

unemployment forecast to stabilise at around

5.1%, consistent with an economy still adjusting

to slower underlying demand. Overall, the

near-term environment signals a shift towards

lower inflation, steady but modest growth,

and a labour market that is normalising after

several years of volatility.

The Vanquis Financial Wellbeing Index (VFWI)

provided further insight into consumer resilience.

Among UK workers earning up to £40,000, the

average financial buffer was 11% of monthly

income in 3Q25, down slightly from 12% in

2Q25 but up from 9% a year earlier. However,

persistently low savings rates continue to

constrain long-term financial security. These

trends underscore the importance of inclusive

banking models and financial education

initiatives that build financial confidence and

improve long-term financial capability.

Regulatory and policy environment

The UK financial services sector enters 2026

amid active regulatory and policy reform aimed

at promoting growth and competitiveness.

TheGovernment’s Financial Services Growth

and Competitiveness Strategy sets out a

10-year roadmap to modernise the sector,

including proposals to streamline regulation,

return the Financial Ombudsman Service (FOS)

to its intended role as a focused dispute

resolution service, review ring-fencing rules,

and integrate the Payment Systems Regulator

into the FCA. The quarterly Industrial Strategy

update reinforces financial services as a

priority growth sector, introducing measures

toattract investment, deepen international

collaboration, and ease regulatory burden.

The FCA’s motor finance redress consultation

highlighted the complexity of designing fair

redress frameworks that reflect diverse

customer journeys and business models.

Regulatory focus also remained strong on

operational resilience, data protection, and

Consumer Duty compliance. Consultations on

cross-cutting reforms, changes to the Senior

Managers and Certification Regime, and the

expected Fraud Strategy suggest that the

regulatory agenda will remain active through

2026 and beyond.

Vanquis response

We welcomed the revised FOS case fee structure,

which has reduced unmerited complaints

andimproved redress efficiency. We remain

committed to operational resilience and

delivering fair value under the Consumer Duty.

Vanquis supports reforms that distinguish

between business models, improve regulatory

clarity, and enable responsible growth.

Theseprinciples reinforce our belief that

streamlined regulation can unlock innovation

while maintaining high standards of

consumerprotection.

Looking ahead, we will continue to engage

constructively with policymakers and regulators

to ensure that reforms deliver benefits for

customers and the wider financial ecosystem.

11 – Vanquis Banking Group plc Annual Report and Accounts 2025

Strategic report Shareholder informationFinancial statementsGovernance

Market overview continued

Digital transformation

Digital transformation continues to redefine

consumer finance. Advances in Open Banking,

Artificial Intelligence, and real-time data

analytics are enabling more personalised

customer experiences and more accurate

lending decisions. Nearly half of UK consumers

now rely on mobile platforms to manage their

finances, with growing demand for tools

thatsupport budgeting, saving and wider

financial wellbeing.

Vanquis response

We are investing in digital solutions that turn

insight into action. Through Snoop and our

expanding suite of capabilities, we help

customers make informed money choices.

Real-time insights support financial planning

and build confidence. Innovation remains

central to our strategy, and we continue to

invest in technology that enhances engagement

and improves customer outcomes.

Financial inclusion

The UK’s Financial Inclusion Strategy,

published in November 2025, outlines a

cross-sector plan to improve access to

banking, savings, affordable credit, and

financial literacy. It recognises that fair and

affordable credit is essential to financial

resilience, particularly for households

managing essential costs or unexpected

expenses, and that financial education is

critical to long-term wellbeing. The

Government’s decision to make financial

education compulsory in all primary and

secondary schools from 2028 marks a

significant step forward in building a more

financially capable society.

Vanquis response

We are delivering practical solutions that help

people unlock entitlements, access credit, and

build financial confidence. Our partnership

with Fair Finance has helped 20,000 people

identify £34m in unclaimed benefits and

access £307,000 in affordable loans. In 2025,

we launched the Vanquis Benefits Checker, a

digital tool that helps customers identify

unclaimed benefits and social tariffs. These

initiatives align with the Government’s income

maximisation agenda and reflect our belief

that financial inclusion requires both access to

credit and the confidence to use it effectively.

We strongly support the integration of

financial education into the national

curriculum and contributed to the Department

for Education’s 2023 call for evidence. We

believe that equipping young people with

financial skills from an early age improves

resilience and decision making in adulthood.

Unlocking credit access through

Open Banking

Open Banking is transforming how lenders

assess affordability and creditworthiness.

Byenabling customers to share real-time

transaction data securely, it improves the

accuracy of lending decisions and expands

access to credit for those with thin or

impaired credit files.

Vanquis response

We are harnessing Open Banking to extend

responsible, personalised credit solutions to

more customers. We are leveraging richer

data to strengthen affordability assessments,

reduce reliance on traditional credit scoring,

and support individuals who might otherwise

be excluded from mainstream credit.

As adoption accelerates, we will ensure

OpenBanking plays a central role in

delivering fairer outcomes and widening

access to credit, helping customers build

financial confidence and resilience.

I’ve been with them for over five

years now, and I can honestly

say they’re an amazing company.

Their customer service is top-

notch – super friendly and

always ready to help.”

Vanquis customer

12 – Vanquis Banking Group plc Annual Report and Accounts 2025

Strategic report Shareholder informationFinancial statementsGovernance

Market overview continued

Market snapshot

Market trends Challenges Opportunities Vanquis response

Macro conditions remain subdued:

modest GDP growth in 2025; interest

rates easing; inflation moderating.

Cost-of-living pressures are increasing the

need for flexible, responsible credit solutions.

Gradual improvement in financial conditions

expected from 2026, supporting higher

demand for responsible credit.

Strengthened underwriting using Open

Banking and real-time analytics to assess

affordability more precisely.

Digital adoption accelerating,

withhalf of UK consumers managing

finances primarily via mobile.

Consumers expect integrated money

management tools, frictionless onboarding

and proactive support.

Wider reach through digital channels and

ability to engage customers more frequently

and personally.

Launch of a new integrated Vanquis app –

adigital-first, mobile-led platform that will

bring Snoop’s capabilities into a single

experience, advancing self-service at scale

andunderpinning our shift to a lower-cost,

moreefficient operating model.

Regulatory reform intensifying

across Consumer Duty, motor

finance redress, and broader

competitiveness agenda.

Operating requirements becoming more

complex; continued scrutiny on fair value,

resilience, and redress.

Streamlining of regulation and improved

clarity expected to increase innovation and

reduce operational burden.

Active engagement with FCA and

governmentconsultations; strengthened

Consumer Duty governance; operational

resilience enhancements.

Financial inclusion prioritised by

government through Financial

Inclusion Strategy and compulsory

financial education from 2028.

Millions lack access to affordable credit,

savings buffers or financial capability.

Significant market need for responsible

lending, financial tools, and income-

maximising support.

Expansion of benefits-checking tools; decline

referral partnerships; inclusive product design

to improve access and resilience.

Open Banking gaining scale

asamainstream affordability-

assessment mechanism.

Thin-file and low-score consumers remain

underserved by traditional credit scoring.

Ability to widen credit access and better

servecustomers with non-traditional

financialfootprints.

Use of real-time transaction data to

expandaccess, personalise credit limits,

andimprove outcomes.

Vanquis serves the UK’s financially underserved

population. These are consumers who face barriers to

mainstream credit because of limited credit histories,

lower incomes or lower levels of financial resilience.”

13 – Vanquis Banking Group plc Annual Report and Accounts 2025

Strategic report Shareholder informationFinancial statementsGovernance

Addressable market and

customeropportunity

We serve the UK’s financially underserved

population. These are consumers who face

barriers to mainstream credit because of

limited credit histories, lower incomes or lower

levels of financial resilience. This group

represents one of the largest and most

persistent structural markets in UK consumer

finance, offering significant potential for

responsible and sustainable growth.

A significant and growing

underserved population

The scale of the UK’s underserved market

highlights the depth of unmet need:

5 c.48.2 million UK adults have an active

credit profile.

5 c.24.2 million, or over one in two, are

underserved by mainstream lenders.

5 Within this group, our prudent risk

appetite extends across a large

proportion of consumers seeking

unsecured credit or Vehicle Finance.

We currently serves c.1.3 million Credit Card

customers and, via the Moneybarn brand,

serves approximately 103,000 Vehicle

Financecustomers.

This sizeable pool of potential additional

customers reinforces the structural importance

of specialist lenders that can responsibly

bridge the gap between consumer demand

and mainstream availability.

Market opportunity supports our

growth plans

Despite our established presence in the

underserved market, our penetration remains

low relative to the scale of the opportunity.

Our overall share is modest and offers room

for meaningful growth. Even modest gains in

share translate into material and sustainable

growth, particularly as some mainstream

providers continue to reduce exposure to

higher-friction customer segments. This creates

a long-term growth runway in a market where

consumers actively seek fair access, digital

simplicity and personalised support, and

where our strengths are well aligned to

evolving customer expectations.

Structural trends supporting

market growth

Demand from underserved consumers

continues to be shaped by long-term trends

that are embedded in the UK economy:

5 Financial resilience remains low and

uneven, with many households maintaining

only limited savings buffers.

5 Non-standard and flexible employment

continues to expand, creating income

profiles that traditional credit models

often struggle to assess.

5 An estimated £22.7bn in unclaimed benefits

each year highlights persistent income

vulnerability across a broad population.

5 Digital adoption is accelerating, with

around half of UK consumers now

managing their finances primarily

throughmobile channels.

These structural forces are creating a sustained

and growing need for inclusive, technology-

enabled and affordability-focused credit

solutions. They also reinforce the long-term

relevance of specialist lenders who can

navigate complexity and provide responsible

access for customers underserved elsewhere.

Positioned to capture

long-termvalue

We are well placed to meet this demand

responsibly and profitably. Our strengths

include:

5 advanced data capabilities, including

Open Banking insights, to enable

moreinclusive, precise and real-time

affordability assessments;

5 a developing digital ecosystem,

withthenew mobile app and Snoop’s

personalised financial tools to enhance

engagement and strengthen customers’

financial resilience;

5 an evolving digital Credit Card proposition,

designed to attract underserved

consumers and retain customers as

theybuild financial resilience;

5 income-maximisation and support tools,

such as the Benefits Checker and our ‘not

yet’ partnership with Fair Finance, helping

customers access entitlements and

improve financial wellbeing;

5 deep customer insight, gained from

extensive research and data analysis,

ensuring every decision, from product

development to in-life management,

delivers clear customer benefit; and

5 proven expertise in serving consumers

outside mainstream lender criteria,

underpinned by long-standing experience

and responsible lending practices.

We continue to enhance our digital platform,

combining credit, savings and personalised

money-management tools in a single unified

ecosystem. This deepens engagement, extends

our reach and supports customers as they

improve their financial confidence and resilience.

With a clear purpose and a scalable digital

platform, we are well positioned to grow our

presence in a structurally robust and societally

important market, helping more people build

financial confidence while delivering

sustainable returns for shareholders.

Market overview continued

14 – Vanquis Banking Group plc Annual Report and Accounts 2025

Strategic report Shareholder informationFinancial statementsGovernance

Serve More, Serve Responsibly, Scale Profitably

Serve More, Serve Responsibly, and

Scale Profitably captures the three

core pillars of our strategy:

Customer-

led

Insightful risk

management

Efficient

organisation

A great people

proposition

Digital, tech, data

and analytics

Strategy

Serve More

Widen access to healthy,

affordable credit for customers

underserved elsewhere and

deepen long-term customer

relationships.

Serve Responsibly

Ensure strong affordability,

disciplined risk management

and consistently good

customer outcomes across

credit cycles.

Scale Profitably

Build a modern, efficient

andscalable digital bank

thatconverts growth into

sustainable returns.

Together, these pillars provide a

clearstrategic framework for

decision making, capital allocation

and execution across the Group. They

sit at the heart of our customer-led

strategy, guiding how we translate

our purpose into both commercial

and societal value.

Customer-led

Our strategy is grounded in a deep and

continually evolving understanding of the lives

and needs of the customers we serve.

We help customers:

5 borrow healthily;

5 feel in control of everyday spending; and

5 build a financial safety net.

These insights underpin every element of our

strategy and reflect our purpose: to deliver

caring banking so that customers can make the

most of life’s opportunities. They inform product

design, risk management, customer journeys

and how we support customers throughout their

relationshipwith us.

Our strategic ambition

Our strategic ambition is to be the UK’s most

trusted and inclusive specialist bank by unlocking

financial opportunity for underserved customers

and helping them thrive.

This means building a resilient, efficient and

scalable business that delivers strong long-term

returns while serving one of the UK’s largest and

most persistent underserved markets.

Underpinned by a strong capital position,

modern technology and advanced data

capabilities, we are positioned to grow in a

disciplined manner while delivering improved

customer outcomes over time.

A lifesaver! Really helpful to see

everything in one place. It gives

access to my credit report, tips

onhow to improve my score, and

well-written articles explaining how

inflation and interest rates affect

us– plus advice on saving and

making money.”

Snoop customer

For more information on the strategic themes

underpinning our strategy, see page 15

15 – Vanquis Banking Group plc Annual Report and Accounts 2025

Strategic report Shareholder informationFinancial statementsGovernance

Strategy continued

Our five strategic themes and objectives

Strategic themes 2025 highlights Focus for 2026

Customer-led

5 Launched new credit products and expanded savings

(ISAs, Snoop Easy Access), improving financial wellbeing

and customer choice.

5 Achieved a customer satisfaction score of 83.7, above

the industry benchmark of 81.1.

5 Recognised by Moneyfacts as Credit Builder Card

Provider of the Year and Credit Card App of the Year.

5 Strengthened affordability checks and simplified

products to support responsible lending.

5 Broaden our integrated lending, money management

and savings offering, including new flexible credit

solutions tailored to underserved segments.

5 Deliver deeper personalisation using enhanced data

and Snoop ecosystem capabilities.

5 Improve end-to-end customer experience and retention

as Gateway capabilities mature.

Insightful risk

management

5 Enhanced data, analytics and modelling to improve

portfolio insight, strengthen affordability assessments

and optimise credit decisions.

5 Delivered consistently strong credit performance

acrossproducts.

5 Migrated over 30 billion rows of customer, product and

decisioning data onto a new IT platform, enabling

improved analytics, real-time risk management,

automation and personalisation.

5 Use Gateway and advanced analytics for real-time

affordability insights and sharper credit decisioning

across all products.

5 Maintain strong risk-adjusted returns while responsibly

increasing access to credit.

5 Differentiate through superior risk insight, across Credit

Cards, Vehicle Finance and Second Charge Mortgages.

Efficient

organisation

5 Delivered £28.8m of transformation savings in 2025,

exceeding the committed target of £15m.

5 Digital and AI improvements (fraud prevention, debt

sales, complaints handling) contributed to cost savings

and better customer outcomes.

5 Reduced physical footprint, modernising the operating

model and lowering structural costs.

5 Deploy Agentic AI to accelerate service delivery, reduce

cost-to-serve and improve customer experience.

5 Continue operational excellence focus on collections,

fraud and service performance.

5 Ensure costs remain well controlled relative to rising

revenues as Gateway completes.

Digital, tech,

data and

analytics

5 Advanced Gateway transformation with selection

ofFiserv’s Vision Next platform for scalable,

cloud-based infrastructure.

5 Enabled stronger analytics, automation and

personalisation through 30 billion data point migration.

5 Award-winning technology partnerships (e.g. Zoot)

which will improve accuracy and speed of decisioning.

5 Complete re-platforming onto modern cloud

architecture, enabling a digital-first operating model

and structurally lower cost base.

5 Launch our new Vehicle Finance proposition.

5 Integrate Snoop capabilities to accelerate data-driven

insight and customer engagement.

5 Drive continuous automation and innovation to support

scalable growth.

A great people

proposition

5 Achieved Great Place to Work

certification, reflecting

astronger culture and engagement.

5 Introduced our ACT Culture (Ambitious, Caring and

Together), and continued to reinforce our Values,

embedding behaviours needed for a modern,

customer-led bank.

5 Recognised by the Financial Times as one of the UK’s

Best Employers.

5 Deepen ACT Culture and Values across all teams,

strengthening accountability and collaboration as

strategic enablers of growth.

5 Enhance capability development to support digital,

analytical and customer-led transformation.

5 Continue building an inclusive culture aligned to our

purpose: caring banking.

Our 2025 strategic themes remain

thefoundations of our operating

model. From 2026, these are

broughttogether under a single,

clear strategic framework: Serve

More, Serve Responsibly, and

ScaleProfitably.

Collectively, these themes guide how we Serve

More with empathy, Serve Responsibly with

clarity and fairness, and Scale Profitably through

simplicity, efficiency and disciplined execution.

Strategic outcomes

Our strategy directly informs our business model.

By understanding customer needs deeply,

lending responsibly and scaling efficiently

through technology, we turn our strategic

priorities into a resilient model that generates

long-term value for all stakeholders.

Disciplined execution of our strategy will deliver:

5 sustainable income growth;

5 a structurally lower cost base as

Gatewaycompletes;

5 robust credit quality and

affordabilityoutcomes;

5 return on tangible equity consistently

aboveour cost of capital, driving

meaningful capital generation; and

5 flexibility to accelerate growth or

increaseshareholder distributions.

How our strategy creates value

Our strategy creates value by combining

customer insight, disciplined risk management,

operational efficiency and modern technology

to deliver responsible customer outcomes,

resilient shareholder returns, meaningful work

and opportunities for colleagues, and greater

financial inclusion across the UK.

16 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Business model

Our purpose, to deliver caring banking so customers can

makethe most of life’s opportunities, shapes every part of our

proposition. We aim to earn customers’ trust, support financial

confidence and provide solutions that are fair, accessible and

easy to use.

Customer journey

Each stage of the journey is designed to ensure we reach more

customers, support them responsibly and create a scalable,

efficient model for long-term growth.

Awareness

Reaching customers whose needs are not met by

mainstreamlenders.

Consideration

Offering a differentiated, needs-led value proposition

ratherthan a product-led approach.

Conversion and onboarding

Providing a streamlined, digital-first onboarding experience

enabled by our evolving technology capabilities.

Meeting core needs

Helping customers borrow healthily, feel in control of

everydayspending and build a financial safety net.

Support when needed

Offering empathetic, tailored support for customers

experiencing financial difficulty.

Creating value through a customer-focused business model

Our business model puts our strategy

into practice and is underpinned by

the key inputs that drive value

creation: deep customer insight,

disciplined risk management, efficient

and diversified funding, modern

digital capabilities and the experience

and commitment of our people.

Together, these inputs widen access

tocredit, support prudent growth and

enable strong, sustainable outcomes

for all stakeholders.

Everything we do begins with a clear understanding

of our customers’ needs, preferences and financial

behaviours. Through extensive research, data

analysis and insight from our digital ecosystem,

we have identified three core needs that guide

our proposition design and in-life management.

Understanding our customers

Help me borrow healthily

Customers value clear, jargon-free communication and predictable

products that help them manage borrowing over time. We support

this through transparent propositions, enhanced affordability

assessments and early engagement when circumstances change.

Help me feel in control of everyday spending

Many customers manage tight budgets or complex financial

situations. Tools such as Snoop provide personalised insights and

budgeting support, helping customers make informed day-to-day

decisions and build confidence in managing their money.

Help me build a financial safety net

A large proportion of customers have limited savings. We help them

build resilience through accessible savings products, personalised

nudges and guidance that highlights opportunities to save and

prepare for unexpected expenses.

This needs-led approach enables us to build tailored propositions,

deepen customer relationships and position Vanquis as a trusted

long-term partner for customers traditionally underserved by

mainstream lenders.

These insights shape our strategic priorities, inform product design

and enhance risk management across the Group.

Our customer proposition

These values ensure we deliver on our purpose and create positive outcomes for all stakeholders.

Our values:

We care about people We pull together as a team We find a better way We get the right things done

17 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Business model continued

Our customer proposition Our competitive strengths

Deepening relationships

Presenting relevant solutions that build long-term engagement.

Advocacy

Delivering outcomes that encourage customers to

recommendVanquis.

Our target market spans a wide income range but shares

common characteristics: lower financial resilience, limited savings

buffers and a focus on short-term financial stability. These

customers typically seek stability, predictability and peace of

mind, needs our proposition is specifically designed to meet.

Our products and ecosystem

We serve customers through a broad range of

complementaryproducts:

5 Credit Cards – under the Vanquis brand;

5 Vehicle Finance – under the Moneybarn brand;

5 Second Charge Mortgages – through

forward-flowpartnerships;

5 Savings – including fixed-term products, notice accounts,

cash ISAs and Easy Access Accounts; and

5 budgeting and money management – via Snoop,

ourfinancial wellbeing platform.

We are also expanding our marketplace capabilities by

partnering with organisations such as Fair Finance to support

customers not yet eligible for credit, andthrough white-label

partnerships where Vanquis acts as introducer rather than lender.

Together, this ecosystem enables deeper engagement,

cross-purchase opportunities and more predictable

riskoutcomes.

Our competitive strengths give us a durable advantage and

support sustainable, risk-adjusted returns.

Efficient funding

A strong retail deposit base provides lower and more stable

funding costs than many competitors, improving price

competitiveness and supporting long-term financial resilience.

Financial efficiency

We can align lower-cost deposits with lending volumes, helping

us manage the balance sheet efficiently and maintain attractive

unit economics.

Risk-based pricing and deep credit experience

We have extensive expertise serving customers with

non-mainstream credit profiles. This underpins our risk-based

pricing approach and supports disciplined, responsible lending

across credit cycles.

Broad, complementary product suite

Our diversified portfolio allows us to meet a wide range of

customer needs and creates opportunities for cross-purchase

and deeper engagement.

Snoop: a differentiated digital capability

Snoop provides personalised insights that help customers

manage money, reduce outgoings and improve financial

resilience. It also acts as an efficient engagement and

acquisition channel across the Group.

Continuous enhancement of our model

We continue to strengthen our business model through

investment in technology, data, analytics and customer

experience. The Gateway transformation will provide a modern,

scalable and cloud-based platform, enabling a digital-first

operating model, enhanced decisioning, increased automation

and structural cost efficiencies.

By combining customer insight, responsible lending,

efficientfunding and modern technology, we are building

adifferentiated and resilient business that delivers value for

customers and sustainable, long-term returns for shareholders.

These strengths enable us to Serve More customers with

confidence, Serve Responsibly across credit cycles, and Scale

Profitably as Gateway and our broader ecosystemmature.

How our business model creates value

Our business model creates value by bringing together the key

inputs that power our organisation – our people, data, digital

platforms, risk expertise and diversified funding – and

transforming them through a disciplined set of activities.

These include understanding customer needs, designing tailored

credit propositions, assessing affordability and risk, delivering

digital customer journeys and managing lending throughout

thelifecycle. Through this integrated model, we convert our

resources into access to credit for underserved customers,

stable and sustainable returns for shareholders, rewarding

careers for colleagues, and positive outcomes for wider society.

For details of how we measure the value created through our

business model, see our Key Performance Indicators on pages

18 to 20.

Underpinned by our culture:

Our ACT culture (Ambitious, Caring, Together) anchors the behaviours needed for a modern, customer-led bank.

18 – Vanquis Banking Group plc Annual Report and Accounts 2025

Strategic report Shareholder informationFinancial statementsGovernance

Key Performance Indicators

Strategic Pillar 1: Serve More

Widen access to credit and grow our customer base with consistently good customer outcomes.

Number of customers

(m)

1.77m

Definition

Total customers across Credit Cards,

Vehicle Finance, Second Charge

Mortgages, Savings andSnoop.

Strategic focus

Drive sustainable growth by

expanding reach in underserved

markets, deepening engagement,

and building long-term customer

relationships that support

profitability and resilience.

Principal risk

Customer risk and business

performance risk – Failure to

attract and retain customers in

target segments undermines

growth, erodes trust, and limits

strategic diversification.

FY23 FY24

FY25

Customer satisfaction

index (CSI)

83.7

Gross customer interest-

earning balances (£bn)

£2.8bn

Definition

Weighted average customer

satisfaction score across Credit

Cards, Vehicle Finance and Savings.

Strategic focus

Strengthen advocacy and

retentionthrough consistently

positive experiences.

Principal risk

Customer risk – Poorexperiences

harm retention and outcomes.

Definition

Interest-earning amounts receivable

from customers.

Strategic focus

Grow high-quality lending in target

segments to deepen financial

engagement and deliver asset

growth within prudent risk appetite.

Guidance

2026: >£3.3bn

2027: >£3.7bn

Principal risk

Market risk and credit risk

– Changes in demand, economic

conditions or underwriting quality

may reduce portfolio growth or asset

quality, impacting income and returns.

FY23 FY23FY24 FY24FY25 FY25

1.75

1.69

1.77

2.4

2.3

2.8

Key

Certain alternative performance measures (APMs) have been

used in this report.

See pages 196 to 198 for an explanation of their relevance,

definition and method of calculation. In the current year,

theupdated management team has revised its focus to

theAPMs presented below; there have been no changes

tothese APMs in the year.

Trend arrows indicate the direction of movement year on year,

not whether this is favourable or unfavourable.

FY23 and FY24 KPIs for cost of risk, net interest margin, risk-

adjusted margin and cost: income ratio have not been updated

to reflect the impact of the sale of the Personal Loans portfolio as

a discontinued operation.

FY23 and FY24 cost: income ratio and ROTE have also not been

adjusted for the move to statutory reporting in FY25 and exclude

previous adjusting items (transformation costs, exceptional costs

and amortisation of acquisition intangibles).

Customer satisfaction index

In 2025, we introduced a new customer satisfaction measure to provide a consistent, data-driven

view of customer experience across our products and services. Our priority is to use this insight to

continually raise standards and deliver improved outcomes for customers. With a current weighted

average Customer Satisfaction Index (CSI) score of 83.7 ahead of the industry average of 81.1,

wearebuilding on a strong foundation for future progress.

—

83.7

—

The Key Performance Indicators (KPIs)

represent the principal metrics reported

toGroup management on a monthly basis

tosupport the strategic decision making.

KeyPerformance Indicators have been

updatedto better align with areas of guidance.

19 – Vanquis Banking Group plc Annual Report and Accounts 2025

Strategic report Shareholder informationFinancial statementsGovernance

Key Performance Indicators continued

Strategic Pillar 2: Serve Responsibly

Maintain strong affordability, disciplined risk management and consistently good customer outcomes, supported by an engaged workforce and positive community impact.

Net receivables

(£bn)

£2.7bn

Definition

Gross receivables less impairment,

reflecting the net value of

customerlending.

Strategic focus

Grow and maintain high-quality

receivables to support long-term

profitability, while staying within

risk appetite.

Principal risk

Credit risk – Failure to manage

asset quality and customer

affordability increases

impairments, erodes earnings, and

limits capacity for future growth.

FY23 FY24

FY25

Colleague

engagement (%)

73%

Senior management

gender diversity (%)

33%

Community investment

(£m)

£0.9m

Definition

A metric used to gauge colleagues’

engagement, motivation and

commitment towards their work.

Strategic focus

Foster a high-performance,

values-led culture where colleagues

are motivated, supported and

empowered, driving the delivery

ofour strategy.

Principal risk

People risk – Low engagement

undermines culture, reduces

productivity, and increases attrition,

limiting our ability to deliver

strategic objectives.

Definition

The percentage of the Group’s senior

management who identify as female.

Strategic focus

Committed to the Women in Finance

Charter by achieving a 40% target

by 2026 through delivering signatory

actions to create a more equal,

inclusive and gender diverse

workplace.

Principal risk

People risk – Gender balance

improves culture and diversity of

thought, enhancing our ability to

deliver strategic objectives.

Definition

The cash cost of contributions

provided to community projects

orcharities.

Strategic focus

Investments through our Foundation

partners to address the wide range

of social and financial inclusion

issues that are relevant to our

customers and the communities

where we operate.

Principal risk

Customer risk – By investing in the

communities we serve we help to

improve our customers’ lives.

Cost of risk

(%)

7.3%

Definition

Impairment as a % of average gross

customer interest-earning balances.

Strategic focus

Maintain disciplined underwriting and

affordability standards to protect

asset quality and preserve earnings

as we grow.

Principal risk

Credit risk – Rising impairments from

poor affordability or economic stress

erode profitability, weaken capital

resilience, and constrains future

lending capacity.

2.2 2.2

2.7

7.0

8.4

7.3

1.4 1.4

0.9

FY23 FY24 FY25 FY23 FY23 FY23FY24 FY24 FY24FY25 FY25 FY25

Moneybarn made financing my car quick and easy. I was back on the road in no time!”

Moneybarn customer

20 – Vanquis Banking Group plc Annual Report and Accounts 2025

Strategic report Shareholder informationFinancial statementsGovernance

Key Performance Indicators continued

Net interest margin

(%)

16.8%

Definition

Interest income less interest expense

as a % of average gross customer

interest-earning balances.

Strategic focus

Drive income growth through

disciplined pricing while

balancingrisk and delivering

faircustomer outcomes.

Guidance

2026: c.15.5%

2027: c.14.5%

Principal risk

Business performance risk – Failure

to grow income sustainably limits

profitability, constrains investment

capacity, and undermines long-term

strategic objectives.

Risk-adjusted margin

(%)

11.0%

Definition

Income after impairment as a %

ofaverage gross customer

interest-earning balances.

Strategic focus

Protect earnings quality by

maintaining disciplined pricing,

managing impairments and adapting

to market conditions.

Guidance

2026: >9.5%

2027: >9.0%

Principal risk

Market risk and credit risk – Rising

impairments or margin compression

erode returns, weaken resilience,

andrestrict future growth.

Strategic Pillar 3: Scale Profitably

Drive efficiency, capital discipline and sustainable returns.

FY23 FY24 FY25

Cost: income ratio

(%)

58.4%

Definition

Operating costs as a % of

totalincome.

Strategic focus

Enhance operational efficiency to

safeguard profitability, enable

reinvestment, and maintain

competitiveness.

Guidance

2026: High 40s

2027: Mid 40s

Principal risk

Operational risk – Failure to manage

costs effectively reduces profitability,

limits investment capacity and

undermines long-term

competitiveness.

Common Equity Tier 1 (CET1)

ratio (%)

16.5%

Definition

CET1 capital as a % of risk-weighted

assets measured in accordance

withthe Capital Requirements

Regulation (CRR).

Strategic focus

Maintain strong capital resources

tosupport growth and meet

regulatory requirements.

Guidance

>14.5%

Principal risk

Capital risk – Insufficient capital

limitsgrowth capacity and

strategicflexibility.

ROTE

(%)

2.3%

Definition

Profit attributable to shareholders as

a % of average tangible equity.

Strategic focus

Deliver returns on tangible equity to

support long-term value creation,

resilience and investor confidence.

Guidance

2026: Low double digits

2027: Mid-teens

Principal risk

Business performance risk – Failure

to deliver sustainable profitability

undermines strategic investment,

resilience and long-term

valuecreation.

Liquidity coverage

ratio (%)

306%

Definition

A regulatory measure that assesses

net 30-day cash outflows as a

proportion of high quality liquid

assets (HQLA).

Strategic focus

Ensure robust liquidity to meet

obligations and enable strategic

growth within risk appetite.

Principal risk

Funding and liquidity risk

– Insufficient liquidity threatens

resilience and operational continuity.

18.6

18.4

16.8

13.6

11.7

11.0

62.6

65.9

58.4

19.9

18.8

16.5

306

359

1,263

(7.0)

FY23 FY24 FY25

FY23 FY24 FY25 FY23 FY24 FY25

FY23 FY24 FY25

When I needed to build my credit score after some money problems, Vanquis was there to help. I’ve been with them

10+ years without a problem. Their customer service is excellent – always keen to listen and help. Thank you, Vanquis.”

Vanquis customer

FY23 FY24 FY25

2.3

1.9

21 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Sustainability

Stakeholder engagement

How we listen and respond

toourstakeholders

Effective engagement with stakeholders is

fundamental to how Vanquis operates and

howwe make decisions across the business.

Itinforms not only the products and services

weprovide to customers, but also how we

respond to stakeholder expectations around

sustainability performance and ESG matters.

We define stakeholders as individuals or groups

who have an interest in, or are affected by, our

business activities. We have identified six key

stakeholders groups that we prioritise for

engagement. These are: customers, colleagues,

suppliers, investors, government and regulators,

and our communities and wider society,

including the environment.

Customers

Our customer strategy is built on a deep

understanding of our customers’ lives and

needs. This insight informs how we design

and deliver our products and services, how

we use technology, and how we meet our

strategic priorities and commitments.

Customers choose Vanquis for inclusive,

reliable products and services that help

them build confidence and make the most

of life’s opportunities.

Colleagues

Our colleagues are central to the success

ofVanquis. We focus on attracting and

retaining talented and engaged people

who can innovate and help deliver our

strategic priorities and technology-led

transformation. Inreturn, we aim to provide

meaningful career development, fair reward

and recognition, and a diverse, inclusive

and healthy working environment that

offers flexibility and choice.

Suppliers

Our suppliers play an important role in

delivering our strategy and supporting the

long-term success of our business. A strong

and resilient supply chain enables us to

provide responsible and sustainable

products and services for our customers.

Inreturn, suppliers expect fair contractual

and payment terms, robust supply chain

standards and a commitment to positive

social, environmental and ethical impacts.

Investors

Our existing and future investors provide

the capital that enables us to deliver

ourstrategy and grow sustainably.

Inreturn, they expect disciplined financial

performance, efficient operations, strong

governance and risk management,

andclear, timely and high-quality

corporate information.

Government and regulators

Government and regulators are key

stakeholders for Vanquis. Through open

and proactive dialogue, we work to ensure

policymakers understand the customers we

serve and the important role responsible,

regulated credit plays in supporting

financial inclusion.

Communities and wider society

Our work in communities and wider society

helps bring our purpose to life. By investing

and generating positive social impacts

inlong-term partnerships, supporting

colleague volunteering and considering

ourenvironmental impact we aim to create

positive and lasting social outcomes.

A range of engagement mechanisms, as set

outin the table below, are utilised by us for

eachof our key stakeholder groups and

includeopportunities for effective dialogue and

feedback from stakeholders. Further information

on how the Board monitors the effectiveness of

stakeholder engagement and ensures that it,

where appropriate, influences its decision

making is set out on page 52 of thisreport.

22 – Vanquis Banking Group plc Annual Report and Accounts 2025

Strategic report Shareholder informationFinancial statementsGovernance

Sustainability continued

Stakeholder Engagement approach Results of engagement

Customers

5 Customer surveys, focus groups and market research on

arange of topics.

5 Regular use of communication channels such as applications

and websites.

5 Use of review platforms (e.g. Trustpilot) and

complaintsprocesses.

5 Engagement with, and feedback from, debt and money

advice sector organisations.

5 Inclusive design sessions to inform product and

servicedevelopment.

5 New brand was launched in June.

5 Customer stories published demonstrating how Vanquis products have helped customers manage their

personal financial situations.

5 We received customer input in the design of its new app and customers were involved in the beta and

roll-out phases to capture further improvements and report any issues.

5 In conjunction with inbest.ai, we launched a benefits checker to help customers identify if they are

missing out on financial support they are entitled to. Customer research completed ensured the

calculator met real needs.

5 A roundtable session held in March brought experts, charities and customers together to share

experiences of financial inclusion and access to credit. Four key recommendations were shared with

theFinancial Inclusion Committee, which focused on financial education and numeracy, access to

benefits, early indication of financial distress, and effective decline referrals.

Colleagues

5 There are a range of colleague-led groups in place that

enable our teams to connect and network, and support the

creation of an inclusive workplace culture, including

ourColleague Forum and five diversity and inclusion

affinitygroups.

5 We use several communication channels, with regular

updates on the Company and colleague-related news

delivered via Viva Engage, digital newsletters, in-person

events and regular livestream sessions, which enable

colleagues to engage in two-way dialogue.

5 The Company was accredited as a ‘Great Place to Work

’ in November following completion of the

Colleague Survey.

5 21 colleagues celebrated as ‘culture makers’ from 143 nominations across the business.

5 ExCo Open Doors launched in August providing colleagues the opportunity to have one-to-one sessions

with ExCo members.

5 Seven live-streamed Stay Connected events were held during 2025 sharing business updates and

successes, and answering colleague questions.

5 Save As You Earn scheme offered to eligible colleagues in September 2025.

5 New colleague benefits announced in July, including workation and buy and sell holiday.

5 In February, the Financial Times UK’s Best Employer survey ranked Vanquis at seventh in the banking

and finance services sectors and within the top 50 employers nationwide.

5 Colleagues provided 302 continuous improvement ideas, 56 of which have been put into action.

5 Across the year, webinars were held on a range of different topics (from building resilience to avoiding

burnout) via the inclusion and diversity wellbeing webinars.

Investors

5 Regular trading updates are provided to investors

viaourrefreshed Company website.

5 Investor roadshows, meetings and attendance

andparticipation at investor conferences.

5 There were regular discussions and briefings for investors

and analysts.

5 FY24 and 1H25 results presentations were held online

andincluded a Q&A session.

5 New investors joined the register during the year.

5 Increased industry press coverage.

5 Familiarity with the Group’s strategy and greater understanding of the Group’s business case.

5 Increased likelihood to attract overseas investment.

23 – Vanquis Banking Group plc Annual Report and Accounts 2025

Strategic report Shareholder informationFinancial statementsGovernance

Sustainability continued

Stakeholder Engagement approach Results of engagement

Communities and

wider society

5 Regular meetings and calls with charity and

communitypartners.

5 Participation in seminars and conferences that relate

tokeyissues (e.g. financial inclusion).

5 Internal communication channels used to inform colleagues

and provide ways that they can get involved in the

communities we serve.

5 We signed the Armed Forces Covenant to help veterans transition into meaningful careers after their

militaryservice.

5 A roundtable session held in March brought experts, charities and customers together to share

experiences of financial inclusion and access to credit. Four key recommendations were shared with the

Financial Inclusion Committee.

5 Colleagues were involved in numerous events to support local charities including the donation of

Christmas presents, supporting reading skills online, painting community centres, championing improved

numeracy skills and volunteering at foodbanks – the target of >2,400 hours volunteeringachieved.

Suppliers

5 Supplier onboarding process for new suppliers.

5 Ongoing due diligence process for new and existing suppliers.

5 Regular operational supplier meetings to review KPIs, as

well as raise and resolve any issues.

5 Gold standard award under the Fair Payment Code.

5 Enhanced operational resilience framework.

5 Board-approved operational resilience self-assessment.

5 The Third-Party Risk Management Policy was updated in September 2025 approved

bytheRiskCommittee.

5 Updated Modern Slavery Statement approved in March 2025.

5 Material contracts signed.

Government and

regulators

5 Regular meetings and calls with both the FCA and PRA

andother policymakers.

5 Engagement with regulators takes place via membership

oftrade associations (e.g. UK Finance) and advisors.

5 Participation in consultation exercises that relate to

proposed regulatory changes.

5 Contributed to Consumer Credit Act consultation.

5 CEO met FCA in June to provide input in the vehicle finance commission redress scheme and the Group’s

response to the consultation submitted in December.

5 CEO participated in an FCA panel discussion on ‘Regulating for Growth’.

5 CEO is on the Board of UK Finance.

5 CSREP completed during the year.

5 The Group participated in PRA’s thematic review of UK retail unsecured credit in July.

5 Chairman attended mid/small cap bank roundtable in October.

Our purpose to deliver caring

banking so that our customers can

make the most of life’s opportunities

is supported by our sustainability

strategy, which is organised under

thefollowing five key priorities

andunderpinned by our commitment

to ensure that we will conduct our

business activities by acting with

integrity and in a responsible and

ethical manner.

24 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Sustainability continued

Delivering caring banking

Helping our customers to be financially

included through the provision of

responsible and sustainable products

andservices.

Engaging with the communities we serve

bysupporting financial and social

inclusionand improving numeracy and

employability skills.

Maintaining an inclusive workplace culture

that is safe and engaging, and provides

opportunities for growth and development.

Ensuring we pay our suppliers promptly,

and supporting and respecting human

rights in our supply chains.

Minimising our impact on the environment

and working with others to act on the issue

of climate change.

Customers Colleagues

Communities and

wider society

Suppliers

The environment

Sustainability governance

Our sustainability strategy is aligned with our

purpose to deliver caring banking and ensures

that we conduct our business responsibly and

manage our ESG priorities (see page 25). Our

Board has oversight of the Vanquis Sustainability

programme and reviews it once a year. It also

delegates responsibility for aspects of sustainability

performance monitoring (e.g., in relation to climate

change-related risk reporting) to the Audit

Committee. Our Remuneration Committee also

ensures that a range of sustainability metrics

are included in the Annual Bonus Plan for the

Group’s executives. Additional information on

our governance can be found on pages 64

to128.

Our Executive Committee plays an important

role in supporting the delivery of the Group’s

sustainability strategy and routinely discusses

sustainability activities and ESG issues that are

material to the business and its key stakeholders.

In doing so, it is supported by our Climate Risk

Committee (see page 33) and Inclusion Community

(see page 28). It also reviews and approves the

Group’s programme of activities and its budget.

The day-to-day delivery of the programme

andour response to the ESG agenda are

carried out by our in-house sustainability team,

which is supported by colleagues from across

the business. This includes the colleagues who sit

on the various working groups we have in place

and oversee the management of environmental

and community investment matters.

A clear and strong purpose is fundamental tothelong-term success of our

business. It guides ourdecision-making processes and ensures we deliver

simple, affordable and flexible products that meet customers’ needs and

support financial inclusion. It also shapes how we work with partners

inthecommunities we serve, how we create an inclusive workplace,

andhowwe seek to minimise our impact ontheenvironment.”

Ian McLaughlin

Chief Executive Officer

25 – Vanquis Banking Group plc Annual Report and Accounts 2025

Strategic report Shareholder informationFinancial statementsGovernance

Stakeholder Measure Performance in 2025 Status Focus for 2026

Customers

Level of customer

satisfaction

Customer satisfaction across all products: 83.7 5 Improve customer satisfaction levels across our products

andservices.

5 Use customer insight to continually raise standards and deliver

improved outcomes for customers.

Total number of

customer complaints

Total number of complaints: 52,919 (2024: 87,561)

5 Continue to reduce the volume of customer complaints by

improving customer outcomes.

5 Continue to reduce complaint handling costs.

Colleagues

Workplace culture and

colleague engagement

Great Place to Work

Colleague Survey participation rate: 87%

(2024: 81%)

Great Place to Work

Trust Index score: 73% (2024: 60%)

5 Maintain Great Place to Work

certification.

5 Continue to identify opportunities to improve colleague

engagement and workplace culture in line with our

commitment to create a workplace where people feel valued.

Communities

Amount invested to

support our

communities

£929,125 invested to support our Foundation (2024: £1.4m) 5 Continue to invest in the communities we serve by supporting

financial and social inclusion and improving numeracy and

employability skills.

5 Continue to engage with colleagues to support their local

communities with their skills and talents through volunteering.

Suppliers

Prompt payment

ofsuppliers

98% of suppliers paid within 30 days (2024: 97%) 5 Continue to ensure that all suppliers are paid within 30 days.

5 Review and update our supplier due diligence process to

embed new diversity and inclusion questions within the

questionnaires we use.

The environment

Absolute scope 1 and 2

GHG emissions 2025

Total scope 1 and 2 GHG emissions: 469 tCO

e (2024: 500 tCO

e),

areduction of 6%.

Total scope 1 and 2 (and associated scope 3) GHG emissions:

584tCO

e (2024: 647 tCO

e), a reduction of 10%

5 Continue to identify opportunities to improve the energy

efficiency of the Group’s operations.

5 Conduct an internal review of our ability to meet the new

expectations set by PRA supervisory statement 5/25 –

Enhancing banks’ and insurers’ approaches to managing

climate-related risks.

Sustainability continued

Key

Achieved Partially achieved Not achieved

Our 2025 sustainability performance at a glance

26 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Sustainability continued

Snoop money management app

We continue to actively promote the Snoop app

to our customer base. Snoop uses Open Banking

to analyse the spending of customers and

suggest ways to save money across a number

of areas of personal finance. This helps our

customers to improve their creditworthiness and

their borrowing and debt management. It also

tracks customers’ regular bills and flags up when

they are higher than usual, sometimes offering

up cheaper providers they can switch to.

Benefits Checker

In 2025, in recognition that over £24bn of

income-related benefits and social tariffs in

Great Britain go unclaimed every year, we

launched the Vanquis Benefits Checker. This new

digital tool is designed to help customers quickly

and easily identify benefits and social tariffs they

may be entitled to, ensuring fewer households

miss out on vital financial support. The launch of

the Vanquis Benefits Checker follows a successful

partnership with Fair Finance, which has helped

20,000 people identify and claim over £34m in

entitlements since December 2024. The tool,

which ispowered by an Artificial Intelligence

platform, makes use of a simple, guided

questionnaire to identify potential benefit

entitlements, including Universal Credit, Pension

Credit, Disability and Carer’s Allowances, and

more. This enables users to answer straightforward

questions about their household, income, and

living situation, and they are then directed to

official pages where they can apply for

relevantbenefits.

Customers

Customer satisfaction

83.7

Customer numbers by product

5 Credit Cards: 1,339k (2024: 1,267k)

5 Vehicle Finance: 103k (2024: 110k)

5 Second Charge Mortgage: 9.9k

(2024:3.7k)

5 Savings: 81k (2024: 57k)

5 Snoop: 328k (2024: 293k)

Supporting the financial

inclusion of its customers

is at the heart of what

Vanquis does.

We do this by offering a range of credit

cards that are designed to suit different

needs and saving products through our

Vanquis brand, specialist Vehicle Finance

through Moneybarn, Second Charge

Mortgages via origination partners and

freeand easy-to-use money management

support via our Snoop app. We also know

that this commitment to support the

financial inclusion of our customers extends

to being there for them should health issues,

financial instability and other life events

impact their ability to manage their finances.

Measures in this pillar

5 Level of customer satisfaction

5 Total number of customer complaints

Supporting our vulnerable customers

We have a duty to support customers if they

experience financial difficulties, and our

colleagues play a vital role in providing this

support in the first instance. As such, all our

frontline colleagues are trained to recognise

characteristics of vulnerability and respond

appropriately to customer needs. This enables

our colleagues to respond appropriately when

acustomer shares a need or shows clear signs

of vulnerability, exercise judgement to adapt

tocustomer needs and take prompt action to

prevent harm and refer customers to in-house

orthird-party specialists when necessary.

This is why a key pillar of the Vanquis Foundation

focuses on working with specialist partners to

address issues such as customer vulnerability

and financial difficulties. By supporting these

organisations, our customers can access

independent and personal financial advice and

support if they encounter financial challenges.

27 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

The Money Charity

Vanquis has partnered with The Money

Charity, a charity that provides information,

advice and guidance to people of all ages

so that they can manage their money well

and increase their financial wellbeing,

since2013.

Throughout the year, our support for The Money Charity

enabled it to deliver 200 workshop hours to over 4,300

young people. The aim of these workshops is to provide

young people with building blocks to sound money

management, helping them to develop the skills,

knowledge, attitudes and behaviours they will need so

they can make the most of their money throughout their

lives. In addition, during 2025 we provided funding to

enable The Money Charity to continue publishing The

Money Statistics Report, which is widely used by financial

services companies, third sector organisations and the

media. This report, which is published monthly, is a

round-up of financial facts and figures that relate to

consumer confidence and whether challenges, such as

cost-of-living and energy crises, high interest rates and

the economic policies of the new US administration,

have affected the lives and finances of many people

across the UK.

Sustainability continued

Customers continued

Working with StepChange and

Christians Against Poverty

While we work to collect outstanding debt,

customers sometimes enter debt agreement

plans with leading free debt and support

charities such as StepChange and Christians

Against Poverty (CAP). We continue to accept

the offers of payment when customers have

sought advice from these charities, and a

financial assessment has been made of

theircircumstances. Through the ‘fair share’

agreements we have with these charities,

wecontribute almost 12% of any payment

wereceive from a customer who has entered

adebt agreement plan with the charities.

These contributions mean our business pays

for the debt advice received by the customer.

They provide the charities with financial

support so that they can continue to provide

free, independent advice. During 2025, we paid

£198,335 (2024: £254,777) to StepChange and

CAP in ‘fair share’ contributions.

IncomeMax support

We continue to support customers who are

experiencing financial difficulties by making

referrals to IncomeMax, a community interest

company that helps people to maximise their

household income by providing them with

independent advice and support to navigate

the complex welfare system. The income

maximisation process carried out by IncomeMax

involves the organisation completing an

assessment with customers who have been

referred to it, either by our frontline colleagues

or through the IncomeMax chatbot, and using

that information to assess whether the customer

is entitled to any additional benefits, grants,

orschemes, and how these can be claimed.

IncomeMax has also developed a toolkit which

provides our customers with access to valuable,

comprehensive signposting and self-serve

support where a formal referral is necessary.

Plain Numbers

Through our work with Plain Numbers, we are

working to improve the way we communicate

and explain important financial information

toour customers, so that they can fully

understand their financial situation and are

able to make better financial decisions and

deal with the challenges that life may throw

atthem. Since we started working with

PlainNumbers in 2023, we have used our

partnership to support our customer

communications and to improve content for

educational videos to explain some of the

terms that crop up in financial communications

and are often misunderstood by consumers.

Throughout 2025, we have used our partnership

to inform the development of the new mobile

app that we are launched in January 2026.

Case study

At Vanquis, we’re proud

of our partnership with

The Money Charity,

which helps to support

people from across

theUK to build the

skills and confidence

they need to manage

their money and

improve their

financialwellbeing.”

Ian McLaughlin

Vanquis CEO

28 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Sustainability continued

Shaping our culture

We recognise that the culture at Vanquis

shouldbe positive, supportive and dynamic,

where innovation thrives, personal growth is

supported, and colleagues feel valued, safe and

motivated. By having a culture that is informed

by our purpose and values, we can ensure that

it shapes our leadership, our ways of working

and the experiences we create for all our

colleagues. Ultimately, it builds an innovative,

high-performing and inclusive community where

colleagues feel motivated, valued and elect

tostay and develop their careers.

Throughout the year, colleagues from across

ourbusiness took part in a series of workshops

to help define the culture we want to build and

how it can be embedded across Vanquis. We’ve

created a simple, memorable culture statement

to guide the future of Vanquis - summed up in

the acronym ACT (see below).

Ambitious

Be ambitious and bold in our goals and

decisions, moving with pace and curiosity,

andembracing innovation.

Caring

Care for each other and our customers, creating

an inclusive, supportive and enjoyable place to

work where people can thrive.

Together

Together as one team, built on trust,

transparency and collaboration – challenging

each other to succeed together.

Inclusion and diversity

The ambition of our Inclusion and Diversity

Policy is to build and sustain an inclusive

cultureand diverse workforce, which will help

usto respond to our diverse customer base.

Itunderlines our commitment to treating

allcolleagues with respect and dignity and

prohibiting discrimination. It reflects our

commitment to recruit, train, develop, promote

and provide conditions of employment without

regard to race, colour, creed, religion, national

origin, gender, gender identity or expression,

sexual orientation, marital status, age, disability,

or any other characteristic.

The activities that are delivered in support

ofour Inclusion and Diversity Policy continue

tobe driven by our affinity groups, which are

colleague-led and sit at the heart of Vanquis’

Inclusion Community. The affinity group’s focus

on the following themes: disability, LGBTQ+,

gender balance, ethnicity and social mobility.

Our Inclusion Community and affinity groups

celebrated their five-year anniversary in 2025.

During this time, approximately 180 colleagues

who are actively involved in these groups helped

shape a range of policies and processes,

supported mentoring and peer circles, and

enabled colleagues from across the business to

celebrate and raise awareness of specific events

and milestones. During 2025, our affinity groups

influenced the creation of new policies on carer’s

leave and neonatal care leave, helped introduce

flexible bank holidays, continued to enhance

ourReasonable Adjustments Policy, helping us

better support colleagues’ individual needs.

They also ensured that we achieved the Silver

Standard inLGBT Great’s Inclusion Index

Benchmarking Tool for three years running and

supported colleagues, through their volunteering,

to take part in initiatives that facilitate social

mobility inthe communities we serve.

Colleagues

Great Place to Work

score

73%

FY24: 60%

Key Great Place to Work

results

5 Response rate: 87% (2024: 81%)

5 Colleagues agree that Vanquis is a

GreatPlace to Work

: 77% (2024: 51%)

5 Average score across all Great Place

toWork

statements: 75% (2024: 62%)

We are committed to

being an employer of

choice and creating

a workplace where

people feel valued,

empowered and inspired

to growtogether.

We know that by creating an inclusive

workplace culture, we will be well placed

toattract and retain the best people and

create a sustainable pipeline of engaged

and diverse colleagues, capable of

innovating and developing the products

andservices for the customers we have

now,as well as address any future

challenges and opportunities.

Measures in this pillar

5 Workplace culture and

colleagueengagement

29 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Sustainability continued

Colleagues continued

Inclusion and diversity continued

We made a commitment to improve gender diversity across the Group via the HM Treasury Women

inFinance Charter in March 2019. As part of this, we set a target to have 40% female representation

in the Group’s senior management population by December 2026. As of 31 December 2025, we had

the following gender balance:

Total

No. of

women

% of

women

No. of

men

% of

men

Vanquis Banking Group plc Board 8 3 38 5 62

Executive Committee 9 3 33 6 67

Senior leadership population 89 30 34 59 66

All Vanquis colleagues 1,293 627 49 666 51

We also engage with our colleagues on an

annual basis to collect information on other

diversity and inclusion categories.

This

information is summarised below:

5 13% (2024: 16%) of colleagues informed us

that they had a disability or long-term

health condition.

5 18% (2024: 17%) of colleagues informed us

that they come from a Black, Asian, other

White or minority ethnic background.

5 7% (2024: 9%) of colleagues informed us that

they were part of the LGBTQ+ community.

5 14% (2024: 15%) of colleagues have

caringresponsibilities.

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

via our October 2025 Great Place to Work

Colleague

Engagement Survey, which accounts for 87% of the Vanquis

Banking Group workforce.

Further diversity and inclusion information

thatrelates to the FCA’s Listing Rules 6.6.6(9)

and6.6.6(10) is set out in the Nomination and

Governance Committee Report on pages 84

and85.

Employee engagement

We continue to measure engagement to show

how well we are doing at retaining the best

talent and to build our culture through our

annual Colleague Engagement Surveys. In 2023,

we changed the way we conducted Colleague

Engagement Surveys and started using the

Great Place to Work

model. We also set an

ambition to become certified as a Great Place to

Work

, which required us to achieve a response

rate to its core statements of 65% or more.

In2025, 87% of our colleagues responded to

ourannual Great Place to Work

survey, with

73% (2024: 60%) of colleagues rating the core

GreatPlace to Work

statements as “almost

always true” or “often true”. This means that we

have earned Great Place to Work

certification

for the first time, an achievement that reflects

our commitment to invest in leadership,

engagement and collaboration, and create a

working environment where all colleagues can

thrive and make a difference for our customers.

Great Place to Work

certification

isthe result of the effort, passion

and collaboration of colleagues

across the business, building

aculture we can be proudof.”

Elli Michaelides, Chief People Officer

Training and development

We care about our colleagues’ career journeys

and ensure that they are supported to take

ownership of their development and provided

with resources, guidance and opportunities to

develop new skills and grow. Since 2024, we

have provided all colleagues with free access

toLinkedIn Learning, a development platform

thatoffers video-based courses on a variety

oftopics including business, technology, and

people management. By having access to these

resources, our colleagues can develop new skills,

enhance their existing skills, or simply stay up

todate on the latest trends.

To support our HM Treasury Women in Finance

Charter target mentioned above, we have a

Women in Leadership programme that supports

women from across Vanquis to develop their

leadership and people management skills, and

work towards an associated Level 3 or Level 5

apprenticeship qualification. Since we launched

this programme in 2025, 21 women have

participated in this programme.

For the emerging leaders in our business,

wehave our Aspiring Leader development

programme, which enables colleagues who are

new to leadership and people management

towork towards a Level 3 Team Leader

apprenticeship qualification, and build the

skills,knowledge and confidence they need

when applying for new roles within Vanquis.

Colleague wellbeing

At Vanquis, we know that wellbeing is a key

partof our culture and supports our ambition

toattract, retain and empower the best people.

This is why we are committed to supporting our

colleagues by being flexible and empathetic,

and offering a wide range of tools and

resources tohelp them feel their best.

The wellbeing support package we have in

place includes access to digital support, which

enables colleagues to arrange convenient online

health consultations, our Employee Assistance

Programme phone line and a range of health

and wellbeing support services through the

Bank Workers Charity. We also have a network

of Mental Health First Aiders who have the skills

to spot the signs of a person experiencing poor

mental health, and the confidence to start a

conversation about how their wellbeing can be

supported. We also engage and consult with

our colleagues to create family friendly policies

that reflect our values and promote flexible

working options. In 2025, this saw us develop

and launch new policies and guidance on

neo-natal care, paid carers leave and flexible

bank holidays.

30 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Sustainability continued

Our Foundation supports initiatives and

activities across three key areas:

5 financial inclusion advice – partnering

withorganisations that provide money

advice and debt support;

5 education – backing programmes that

improve literacy, numeracy and career skills;

and

5 community – supporting social and financial

inclusion in the areas where we’rebased.

In 2025, we invested £929,125 in the communities

we serve via the Vanquis Foundation.

Supporting the numeracy agenda

At Vanquis we know how important numeracy

skills are in supporting financial wellbeing and

enabling people of all ages to use everyday

maths to help with budgeting, saving, shopping

smart, and planning for the future. This is why

we were delighted to be a lead supporter of

National Numeracy Day 2025, which focused on

the theme of money. During National Numeracy

Day on 21 May 2025, our colleagues volunteered

to support the delivery of a ‘My Maths Story

Assembly’ in several schools local to our offices,

and inspired pupils by sharing personal stories

about how numeracy has shaped their careers

and everyday lives, helping children see the

real-life value of maths. They also supported the

delivery of ‘Maths in the Real World’ classroom

sessions, which brought numeracy to life by

showing pupils how maths is used in a variety

ofjobs and day-to-day situations.

In partnership with National Numeracy, we

published our Financial Wellbeing Index, which

revealed that workers earning up to £40,000

are saving just 1% of their income, highlighting

widespread number confidence issues, low

financial resilience, and the urgent need for

improved financial capability across the UK.

Wealso partnered with the Professional Darts

Corporation’s Bullseye Maths initiative to

delivera special National Numeracy Day event.

Featuring darts player Nathan Aspinall and his

daughter Milly, the session engaged children

through fun, accessible numeracy activities that

promoted positive attitudes towards maths

andeveryday number use.

Supporting children and

youngpeople to develop

employability skills

In 2025, we have continued to work with the

Ahead Partnership, School-Home Support 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, to

deliver sessions that 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.

Communities

Cash £1,171,597

Management costs £114,549

Value of colleague time £77,271

Total £1,363,417

2024

community

investment

figures

Cash £784,125

Management costs £54,792

Value of colleague time £90,208

Total £929,125

2025

community

investment

figures

We believe that Vanquis

has a role to play in

having a positive impact

in the communities we

serve, which is why we

established the Vanquis

Foundation almost three

years ago.

Through our Foundation, we aim to improve

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.

Measures in this pillar

5 Amount invested to support

ourcommunities

31 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Sustainability continued

Communities continued

Supporting children and

youngpeople to develop

employability skills continued

During the year, over 59 colleagues supported

almost 150 schoolchildren and 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. This included working

with the Ahead Partnership to host a ‘Step into

Tech’ workshop at our Bradford head office on

4November 2025. During the day, 46 students

from the Co-op Academy Grange, Carlton

Keighley, and Dixons McMillan Academy took

part in workshop activities that were supported

by our colleagues and were designed to inspire

young women to explore exciting careers in

technology and digital.

Investing in Bradford’s communities

We continue to support local community groups

in Bradford to address a wide range of social

and financial inclusion issues. We do this via

theManjit Wolstenholme Fund, named after our

former Chair of the Board, which is managed on

our behalf by the Bradford District Community

Foundation. Through this fund, we provide

grants to grass roots community organisations

that work with children and young people to

increase their aspirations and empowerment,

develop confidence, resilience and life skills,

andaddress low education attainment and

inequity of opportunity. In 2025, we provided

£50,000 of grant funding to five community

organisations including:

5 Mary Magdalene – Using our grant

funding,the organisation will support

24disadvantaged young people in Bradford

to access the Duke of Edinburgh’s Award,

enabling them to develop essential skills,

confidence and resilience. The grant will fund

a dedicated Duke of Edinburgh Coordinator

and cover essential costs including camp

fees, venues, transport, equipment, training,

and resources. This project will ensure that

young people who are often excluded from

mainstream provision are given the chance

to thrive, grow, and be recognised for

theirachievements.

5 UpCycle – Through our grant funding,

UpCycle will deliver a five-day, hands-on

employability placement for 10 trainees.

Each trainee will complete 25 hours of paid

work experience in UpCycle’s Community

Bike Shop and carry out repairs, serve

customers and manage stock, while staff

willhelp them log technical and transferable

skills (such as teamwork, customer service

and mechanic skills). Trainees will be paid

the Real Living Wage for every placement

hour, recognising their contribution and

removing financial barriers to participation.

Supporting the Bradford 2025

Cityof Culture

We were proud to be a major supporter of the

Bradford district in its capacity as the UK’s City

of Culture during 2025. Through our support,

theRoyal Ballet and Opera, Opera North, and

Northern Ballet, delivered the Sing, Dance, Leap!

project. The aim of this mass participation

project was to help children to express how they

feel about themselves, and their city, through

ballet, opera, and the arts. It culminated with

more than 2,400 Bradford schoolchildren

performing a ballet and opera with professional

dancers, singers, and musicians at the newly

refurbished Bradford Live in June 2025.

Colleague volunteering

We are committed to harnessing the heart and

spirit of our colleagues to support their local

communities with their skills and talent, through

impactful and meaningful volunteering. This is

why all our colleagues can take two days off

work, fully paid, every year to volunteer for their

charity and local community causes. They can

also take time off to support Company-led

initiatives with one of our partners. As at

31December 2025, our colleagues volunteered

3,061 hours (2024: 2,586 hours) to support a

range of good causes, an 18% increase when

compared withFY24.

Throughout the year, our colleagues have

usedtheir two days, volunteering to be charity

trustees and school governors, and provide

technical support to local community initiatives.

The Company-led volunteering initiatives we

delivered during 2025 included team challenges

at community organisations near our offices, tree

planting, and other hands-on activities, as well

as online reading support for disadvantaged

children, sharing career advice with students

entering the workforce, and delivering maths-

themed assemblies to local primary schools.

Supporting children’s literacy

withonlinereading

Throughout the 2024/25 academic year, our

dedicated team of 35 volunteers has provided more

than 200 hours of one-to-one online reading

support to help children from disadvantaged

backgrounds develop a lifelong love of reading

and break the cycle of lowliteracy.

Fundraising

During the year, our colleagues went above

andbeyond to support charities and causes

close to their hearts, from running marathons

and climbing the Yorkshire three peaks, to

having cake bake sales and running a charity

golf day. At Vanquis, we are committed to

enabling them to make a difference in their

communities through their fundraising activities.

This is why we match their fundraising up to a

maximum of£500 per year, per organisation.

In2025, weprovided matched funding donations

thatamounted to £10,199 to charities such as

Alzheimer’s Research UK, the Thames Hospice,

RNLI, the Dogs Trust and many more.

It is an easy way to make

apositive impact on a

child’s life by giving up just

30 minutes per week during

term time and listening to

aninfant school pupil read

online. It is great to be able

to give something back,

especially when you see

thepositive effect you are

having when a shy child

comes out of their shell

andis happy to read

andchat to you.”

Product Development Manager

32 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Sustainability continued

At Vanquis, we are committed to acting with

integrity and conducting our business activities

and relationships in a responsible and ethical

manner. Our aim is to create and maintain a

culture of transparency and trust, where

colleagues feel valued, safe and motivated

(seepages 28 and 29 of this report), and

whichtakes account of issues that matter to

stakeholders such as customers and suppliers,

and our impact on the environment (see pages

21 to 23 and 74 to 78 of this report).

Our Corporate Policy Statement

Our Corporate Policy Statement sets out our

commitments to operating responsibly, ethically,

legally and compliantly. It reflects our purpose

and values and encapsulates the minimum

standards of conduct and policy requirements

for all our colleagues.

For further information on this statement

andthe other policies referred to on this page

go to our website: vanquis.com.

Anti-bribery and anti-corruption

Our policy on anti-bribery and anti-corruption

sets out the Group’s zero-tolerance approach

tobribery and corruption and our commitment

to acting professionally, fairly and with integrity

in all its business dealings and relationships,

wherever it operates, and implementing and

enforcing effective systems and controls to

counter bribery and corruption. The policy

applies to all colleagues, contractors and

directors in relation to the business activities

undertaken by, or on behalf of, Vanquis.

Whistleblowing

Our Whistleblowing Policy and accompanying

programme includes an external third-party

helpline facility which enables colleagues and

third parties to confidentially report concerns.

The Vanquis Board oversees the integrity of the

Group’s arrangements on whistleblowing,

including policies and procedures.

Protecting human rights

Vanquis is committed to supporting and

respecting human rights and, as such, is

opposed to slavery and human trafficking in

both its direct operations and in the indirect

operations of its supply chains. As such, the

Company will not knowingly support or do

business with any organisation involved in

slavery or human trafficking. Our statement

onthe Modern Slavery Act 2015, along with

ourHuman Rights and Modern Slavery Policy

and Supplier Code of Conduct, can be found

onour website.

Technology, information security

anddata

Technology, information security and data

isaprincipal risk for Vanquis (see page 60)

andwe are committed to protecting our

infrastructure and assets, as well as handling

personal information responsibly, securely

andtransparently.

Our tax strategy

We are committed to ensuring that we pay

thetax we are legally required to pay in all

theterritories in which we operate, we comply

with all tax rules and regulations in those

territories and we safeguard our reputation

asaresponsible taxpayer. Our tax strategy,

which was last updated and approved by our

Board in December 2025, can be accessed on

our website.

Conduct

I’ve been with Vanquis for a

few years now and have found

them to be very good. Their

mobile app is easy to use

andmakes it simple to keep

track of your spending.”

Vanquis customer

33 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Sustainability continued

Compliance statement

The climate-related financial disclosure, which relates to the year ended 31 December 2025, set out

inthe following section of our Annual Report complies with UK Listing Rule 6.6.6(8). It is therefore

consistent with the four pillars and 11 recommended disclosures of the Task Force on Climate-related

Financial Disclosures (TCFD). The disclosures made by Vanquis Banking Group plc also comply with

the Climate-related Financial Disclosure (CFD) Regulations 2022 and the UK Companies Act (that is,

sections 414CB(2A) (a to h)). The text and tables below and overleaf outline how these

recommendations and recommended disclosures have been addressed.

Governance

The Vanquis Banking Group plc Board has ultimate responsibility for identifying, managing and

reporting climate-related risks and opportunities and does this through an annual ESG update. 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 delegates elements of its responsibilities to

its committees (see below) to review and approve our climate-related disclosures and to review the

effectiveness of climate-related risks andopportunities in line with our risk management and internal

control framework (see pages 54 to 56).

Audit Committee Remuneration Committee Risk Committee

The Audit Committee supports

theBoard in reviewing the

climate-related disclosures made by

the Group annually in its Annual

Report and Financial Statements.

The Remuneration Committee 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.

The Risk Committee 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.

Executive Committee

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.

He is supported by the ExCo which is responsible for the day-to-day management of the business

and supports the operation of the business and informs decision making on matters not reserved for

the Board or its committees. The Executive Committee ensures climate-related matters are considered

and factored, where appropriate, into strategic decisions across the Group, which includes ensuring

the delivery of our ESG framework.

Climate Risk Committee

The Climate Risk Committee (CRC) is co-chaired by our Group Treasurer and Head of Strategic

Planning & Analysis who, along with colleagues from a range of different functions, provide guidance

and executive oversight of Vanquis’ climate risk management and reporting activities.

Internal audit

The Vanquis Internal Audit function will review the controls that are in place to manage and/or

mitigate climate-related risks as necessary. This was last done in 2023. It is anticipated that an

internal audit of our climate risk-related controls will take place over the next 12 to 18 months.

Strategy

Our strategy continues to relate to ensuring 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.

Climate-related risks are identified, assessed, managed and monitored in line with our risk

management and internal control framework, described on pages 54 to 56. When assessing

climate-related risks and opportunities, we use the time horizons set out below, which we updated

last year to better align with our budgeting and planning cycles. This enables us to continue to

consider the material climate-related risks and opportunities that relate to the current and future

products and services weprovide to our customers, as well as those that are relevant to our

operations and infrastructure (including our supply chain).

2025 climate-related financial disclosure

34 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Sustainability continued

2025 climate-related financial disclosure continued

Strategy continued

Climate-related risks and opportunities assessment periods and time horizons

Short term Medium term Long term

0–1 year 1–5 years 5 years or more

This aligns with our annual reporting cycle and associated operationalactivities. This aligns with the financial and operational planning we use and provides

in-sight into developing risks and opportunities.

This enables us to consider the impact of changing climate-related transition and

physical risks on our business over the long term.

The climate-related physical and transition risks and opportunities we have factored into our strategy are set out in the table below. These have been identified through our impact assessment and scenario

analysis (refer to page 35 for further information on the scenarios and financial impact analysis ranges used). The risks are categorised as physical (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), and the opportunities relate to meeting the needs of our

customers as climate-related policies are implemented and continuing to improve the energy efficiency of our operations and infrastructure.

Risk/opportunity type Risk/opportunity description Business impact Time horizon(s)

Physical risk (acute) There is a risk of increased severity of extreme weather events such as heatwaves,

hurricanes and flooding that disrupts our own operations and supply chains, and those of

our customers, colleagues and communities.

These events could have an impact on infrastructure, causing damage to buildings and

other assets, leading to wide-scale disruption to service delivery. They could also impact

the secured properties of our Second Charge Mortgage customers, which could have credit

risk implications.

Short and medium term

Physical risk (chronic) There is a risk that events, such as rising sea levels, coastal changes and higher average

temperatures and rainfall, 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). They could also have credit risk implications for the

Group’s Second Charge Mortgage customers.

Long term

Transition risk (policy/legal) There is a risk that new or additional climate-related laws, regulations or contractual

commitments (e.g. in relation to energy usage or the manufacture of internal combustion

energy (ICE) vehicles) may result in increased compliance costs, taxes on emissions,

penalties or restrictions that relate to our business models and our stakeholders.

Such transition risks could impact both our operating costs and ability to meet the

demands of our current and future customers. The introduction of taxes designed to

improve energy efficiency could also have cost-of-living implications for our customers,

which has potential to expose the business to credit risks. These could have implications

forour revenue growth opportunities.

Medium and long term

Transition risk (reputation) By failing to deliver on our public net zero commitments there is a risk that we could be

exposed to reputational damage (e.g. that arises from greenwashing allegations) and

increased scrutiny from our customers, regulators, investors and colleagues.

Damage to our reputation because 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. This could lead to financial impacts

on revenues and/or financial penalties, legal challenges or fraud investigations.

Short, medium and

longterm

Opportunity – products

and services

There is an opportunity to develop and introduce new products and services that 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)).

This could lead to increases in our competitiveness and the offerings we deliver to

customers, resulting in increased revenue growth opportunities.

Medium and long term

Opportunity – resource

efficiency and resilience

There is an opportunity to integrate low-carbon solutions into our operations and

infrastructure to further improve energy efficiency and reduce our carbon intensity.

Such opportunities could positively impact both our operating costs and ability to meet the

demands of our current and future customers. This could have implications for our revenue

growth opportunities.

Short, medium and

longterm

35 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Sustainability continued

2025 climate-related financial disclosure continued

The scenarios used to test our business strategy and financial planning

We continue to undertake an annual scenario analysis to test whether our business strategy is sensitive to financial impacts associated with climate-related risks and opportunities. The approach we take to

undertaking our scenario analysis is reviewed annually. We have noted no material changes during FY25 and have made no updates to the scenarios used or the analysis carried out in the current year.

By undertaking an annual scenario analysis, we are able to identify the actual and potential impacts of climate-related risks and opportunities on our business, strategy and financial planning. In doing so,

we use the Group’s financial forecasts, operational footprint, customer data, supply chain information and environmental data, to create a representation of Vanquis. We also continue to use the following

three climate scenarios developed by the Network for Greening the Financial System (NGFS): Orderly, Disorderly, and Hot House World (further details on these scenarios are set out below). These scenarios

have been used because they provide a plausible representation of future climate based on potential trajectories of future levels of greenhouse gas emissions. The NGFS scenarios also couple climate risk

assessment models with macroeconomic and financial models to enable us to determine what climate change impacts and policies mean for the real economy and the financial system.

NGFS scenarios

Orderly Disorderly Hot House World

NGFS Net Zero 2050 NGFS Fragmented World NGFS Current Policies

Description:

5 Climate policies are introduced early and become increasingly

morestringent.

5 Global temperature is limited to 1.5°C.

Description:

5 Climate policies introduced are delayed and divergent leading to high

physical and transition risks.

5 Warming can be limited to <2°C resulting in lower physical risks, but may

result in higher transition risks.

Description:

5 Some climate policies are introduced but accompanying global efforts are

not sufficient.

5 Global warming predicted to increase within a range of 3°C to 5°C.

Key scenario factors:

5 Carbon/energy taxes/levies continue to be used and increase in use during

the next five years.

5 Investment in energy efficiency measures, renewable energy and carbon,

capture and storage are significant.

5 Physical risks are relatively low, but transition risks are high.

Key scenario factors:

5 Countries without net zero targets follow current policies, while other

countries achieve them only partially (e.g. 80% of the target).

5 Investment in energy efficiency measures, renewable energy and carbon,

capture and storage is patchy.

5 Some countries may experience low physical risks.

5 Higher transition risks compared to the Orderly scenario.

Key scenario factors:

5 Climate policies currently in place not maintained.

5 Higher dependence on fossil fuel extraction and use.

5 Transition risks are initially relatively low as limited action is taken.

5 Physical risks are severe, leading to irreversible changes.

In analysing the results of our scenario analysis, we continue to use a financial impact analysis to represent the estimated loss to the Group’s revenues over the next five years assuming that no mitigating

action is taken. The methodology used, which is based on our internal risk management processes, is 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).

36 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Sustainability continued

2025 climate-related financial disclosure continued

The impact of climate-related risks and opportunities on our business, 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

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 more instances of extreme weather

events, such as heavy rain, high wind 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. Under this scenario, it is

likely that more vulnerable parts of the world will be exposed to the

impacts of long-term changes in climate and weather patterns. In the

UK, there is likely to be significant regional variability in flooding impacts,

with large areas of the country not materially impacted by flood risk.

However, it is anticipated that there will be more instances of extreme

weather events, such as heatwaves, heavy rainfall and high winds, which

could disrupt our 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.

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’ exposure to physical risks, although it is accepted that extreme weather events may increase in number and severity compared to the present, they are unlikely to be as severe as those expected under the

Hot House World scenario. Further, the direct financial impacts associated with these events are considered to be minimal for Vanquis because our four main offices in Bradford, Chatham, London and Petersfield 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 (updated August 2025), which uses bespoke software to integrate detailed local flood risk models 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

Yearly chance

of flooding between

2036 and 2069

Bradford Very low Very low 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

We will continue to monitor the Environment Agency’s NaFRA data to assess the exposure of the Group’s main premises to long-term surface water, and river and sea flood risk.

37 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Sustainability continued

2025 climate-related financial disclosure continued

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

Physical risks Acute risks Chronic risks

Scenario Orderly Disorderly Hot House World

NGFS Net Zero 2050 NGFS Fragmented World NGFS Current Policies

Mitigation measures

continued

We have also used the NaFRA data, along with available data from the Scottish Environmental Protection Agency and Natural Resources Wales, to assess the exposure of the Group’s Second Charge Mortgage customers to

flood hazards and risks. This assessment used publicly available data to determine the flood risk of the land around the houses of our customers, not the houses themselves. It enables us to assess the susceptibility of the

secured properties of our Second Charge Mortgage customers to incidents of both surface water and river/sea flooding, which could have credit risk implications for these customers. This analysis is set out below:

Surface water flooding River and sea flooding

% of Second Charge Mortgage customers

Yearly chance

of flooding

Yearly chance

of flooding between

2040 and 2060

Yearly chance

of flooding

Yearly chance

of flooding between

2036 and 2069

High 4% 5% 1% 1%

Medium 4% 5% 1% 1%

Low 8% 9% 3% 1%

Very low 84% 81% 95% 93%

Data not available 0% 0% 0% 2%

The scores set out above are weighted by risk level and type and take account of the efficacy of any flood defences that are in place. A significant proportion of the properties of our Second Charge Mortgage customers are in

areas where there is either a very low or low risk of surface water and/or river and sea flooding. Current contractual terms at origination require properties in areas with high chance of flooding tohave specific flood insurance.

Flood risk impacts on our Second Charge Mortgage portfolio will continue to be monitored, with exploration as to how they can be reflected in the origination partnership agreements with Interbridge Mortgages andSelina Finance.

38 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Sustainability continued

2025 climate-related financial disclosure continued

The impact of climate-related risks and opportunities on our business, 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

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 our ability to

achieve our 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 (see page 39) 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 well

below theloss impacting the profit and low statement threshold

describedabove.

This scenario assumes 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.

However, our analysis indicates that the Group’s exposure to this risk

islow.

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 at this stage.

Mitigation

measures

The measures we will adopt in order to mitigate against these transition risks and ensure that our strategy responds to any potential opportunities include: continuing to analyse the impact of the price of carbon on our

operations and travel and transport activities annually 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

battery electric vehicles (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; and

continuing to monitor customer default rates due to increased costs (e.g. as a result of cost-of-living increases).

39 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Sustainability continued

2025 climate-related financial disclosure continued

Carbon price analysis

By applying carbon prices from the Department for Energy Security and Net Zero’s ‘traded carbon values used for modelling purposes’ research and analysis (December 2024) in the range of £78 per tonne

of carbon (the anticipated price of carbon in 2030 in a Net Zero Strategy Aligned scenario) to £154 per tonne of carbon (the anticipated price of carbon in 2050 in a Hot House World scenario) to our 2025

scope 1, scope 2 and associated scope 3 GHG emissions of 584 tonnes of CO

e, our analysis indicates a carbon price risk of between circa £45k and £90k. This falls well below the minimum financial impact

threshold of £5m described on page 35.

Transition risks Reputational risks

Scenario Orderly Disorderly Hot House World

NGFS Net Zero 2050 NGFS Fragmented World NGFS Current Policies

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 emitted 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 this transition risk 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 ESG-related goals and targets.

40 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Sustainability continued

2025 climate-related

financial disclosure

continued

Analysis of climate-related

opportunities

We continue to review opportunities that will

enable us to introduce new products to our

customers that accommodate their needs and

meet emerging climate-related policy and

regulatory changes. This includes opportunities

that 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 £8,924 in 2025. This compares to the average

price of a used BEV which, in August 2025, was

£22,162 (source: Marketcheck – UK Automotive

Sales Data).

Of the 103,036 ‘live’ customers that are currently

served by our Vehicle Finance business, 3.4% of

these have used their loan to purchase a BEV

car or light commercial vehicle (see tables below

for further information).

Further, the lack of access to private charging at

home continues to be a barrier and contributes

to a two-tier society when it comes to the cost of

EV charging. According to Zapmap, the average

price of the slower public charging options in

January 2026 was 17p per mile compared to the

7p per mile average for at-home charging.

New/used vehicle

% of Vehicle

Finance customers

New vehicle 0.59% (2024: 0.66%)

Used vehicle 99.41% (2024: 99.34%)

Total 100%

Fuel type

% of Vehicle

Finance customers

Diesel 55.76% (2024: 58.19%)

Petrol 37.88% (2024: 37.47%)

BEV 3.40% (2024: 1.09%)

Hybrid electric 0.67% (2024: 2.33%)

Electric diesel 2.07% (2024: 0.14%)

Gas bi-fuel 0.19% (2024: 0.03%)

ND 0.03% (2024: 0.75%)

Total 100%

We are now also continuing to report on the

carbon intensity of the vehicles that we finance

through our finance products (see table below).

classification of vehicles

(kg of CO

per mile)

% of Vehicle

Finance customers

0 = > x < 50 5.62% (2024: 4.09%)

50 > = x < 100 8.20% (2024: 9.77%)

100 > = x < 110 12.35% (2024: 13.38%)

110 > = x < 120 15.36% (2024: 15.86%)

120 > = x < 130 14.53% (2024: 14.87%)

130 > = x < 140 12.79% (2024: 12.73%)

140 > = x < 150 8.33% (2024: 8.09%)

150 > = x < 200 19.28% (2024: 18.07%)

> 200 3.35% (2024: 2.89%)

ND 0.20% (2024: 0.25%)

Total 100%

The resilience of our strategy,

takinginto consideration different

climate-related scenarios, including

a 2°C or lower scenario

Through our scenario analysis we consider our

business to be resilient to the risks we have

identified. This assessment is supported by the

mitigating actions described on pages 36 to 39.

In preparing the Group’s financial statements

(see pages 137 to 198), 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.

Risk management

The process for identifying, assessing and

managing climate-related risks is performed at

a Group level and follows our risk management

and internal control framework described on

pages 54 to 56.

Identifying and assessing

climate-related risks

Our risk management and internal control

framework allows for the ongoing identification,

assessment and reporting of the climate-related

risks and opportunities we face as a business.

Wecontinue to use this framework to identify

potential exposure to climate-related risks

viatheassociated physical risks and transition

risks. 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 Level 1

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. The effectiveness of the

framework is underpinned by four key attributes:

a strong risk culture, clearly defined risk appetite,

robust risk governance, anda three lines of

defence approach to risk management

(seepage 56 for more information).

Climate risk isa Level 1 risk within the Group’s

risk taxonomy and is included within the

regulatory principal risk (P2) (see page 57 for

further detail). All risks are subject to ongoing

monitoring and annual review to identify

changes that may affect the Group’s risk profile.

Monitoring and managing

climate-related risks

To ensure the climate-related risks referenced

above and their potential financial impact on

our business are monitored and managed on

anongoing basis throughout the year we use

several processes. These include: monthly risk

appetite reporting using metrics that 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 and

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 that

relate to the Group’s climate risk.

The CRC 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 during 2025, 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.

41 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Sustainability continued

2025 climate-related

financial disclosure

continued

Integrating climate-related risks

into our risk management policies

and processes

The climate-related risks and opportunities we

have integrated within our risk management

and internal control framework 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 CRC meetings that took place

during 2025, we have been able to monitor and

discuss developments regarding the draft UK

Sustainability Reporting Standards (UK SRS) that

were published for comment by the UK

Government’s Department for Business and

Trade in June 2025.

Metrics and targets

The following section summarises the metrics we use to manage climate-related risks and to realise the climate-related opportunities described above,

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.

These metrics are associated with a specific risk and opportunity category and ensure that any progress made towards mitigating a risk or realising an

opportunity is recorded and reported.

Risk/opportunity

category Aspect Metric Target Progress/explanation

Physical risk Extreme weather Disruptions due to extreme weather

events: Number of insurance claims

Keep insurance claims at 0. 0 (2024: 0).

Transition risk –

policy/legal

Net zero challenge Reduce scope 1, 2 and 3 GHG

emissionsreporting

Net zero by 2040 (relating to the Scope 1,

2 and 3 emissions that arise from

ouroperations).

See GHG emissions table on page 42

and the ESG data table on the Group’s

website.

Science-based targets Carbon reduction Reduce scope 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 scope 1 and scope 2 GHG emissions

have reduced by 62% from a 2021

baseyear.

Currently, c. 45% of our suppliers by

spend have set science-based targets.

Energy usage Renewable energy use Continue to use 100% renewable

electricity across our business premises.

We continue to use 100% renewable

electricity across the business premises

where we have full control of utility

usage.

Transition risk –

reputation

Supplier engagement Monitor suppliers in line with the Group’s

ESG commitments

See SBTi-approved target above. 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 the CDP,

FTSE4Good Index andS&P Global

Corporate Sustainability Assessment.

During the year, we engaged with the

CDP, FTSE4Good Index and S&P Global

Corporate Sustainability Assessment.

Transition opportunity

– 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

Number of Group customers using our

Vehicle Finance products to purchase

BEVs andhybrid electric vehicles.

3.4% of the 103,036 ‘live’ customers

currently served by our Vehicle Finance

business have used their loan to

purchase a BEV car or LCV.

Customer attitudes and perceptions

towards buyingBEVs.

See page 40.

Engagement with policymakers to

support the uptake of BEVs by consumers

in the mid-cost and near-prime parts of

the consumer credit market.

We have continued to monitor

developments in the BEV market

regarding their affordability and access

to at-home charging points.

42 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Sustainability continued

2025 climate-related financial disclosure continued

GHG emissions inventory (SECRreporting)

We report our 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

2024 and 2025. The scope 1 and scope 2 GHG emissions, and energy use figures relate to the UK.

Year FY2025 FY2024

Scope 1 GHG emissions (tonnes of CO

e) 196 111

Gas use 53 107

Diesel and petrol use 0.5 4

Fugitive emissions from air conditioning systems

142 —

Scope 2 GHG emissions (tonnes of CO

Electricity use (market-based emissions)

59 371

Electricity use (location-based emissions) 273 388

Scope 3 GHG emissions (tonnes of CO

Scope 3 associated category 3 ‘well-to-tank’ emissions 115 275

Scope 3 category 1 – purchased goods and services

3, 4

31,333 23,440

Scope 3 category 3 – fuel and energy-related activities

(notincludedinscope 1 and 2) 325 147

Scope 3 category 5 – waste generated in operations 2 2

Scope 3 category 6 – business travel 1,050 1,080

Scope 3 category 7 – employee commuting

952 1,124

Scope 3 category 15 – investments

114,272 262,417

Total energy consumed (kilowatt hours) 1,544,320 1,877,843

Scope 1 and 2 (and associated scope 3 GHG emissions intensity ratio

(kgof CO

e per customer) 0.33 0.43

1 The fugitive GHG emissions that arise from the use and maintenance of the air conditioning systems and units in our offices are

reported for the first time in FY25. This is why there is no comparable data for FY24.

2 The market-based emission factor from one of our two electricity suppliers, which provides electricity to our London office, are in CO

and not CO

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

emissions). The emission factor used in the market-based method for this supplier covers

the period 1st April 2024–31st March 2025 only. The electricity provided to our other offices in Bradford, Chatham and Petersfield is

100% renewable and therefore has a market-based emission factor of 0.

3 When calculating the suppliers’ carbon emissions using the spend-based method, we have used the US Environmental Protection

Agency Economically Extended Input-Output methodology which uses the North American Industry Classification System (NAICS)

emission factors. These emission factors were published in 2023 and provide kg of carbon dioxide equivalents per 2022 USdollar

(USD). As such, our supplier spend figures have been converted into USDusing an exchange rate of GBP1 to USD1.34. In addition,

an inflation rate of £1.15 has been implemented to ensure accuracy and transparency. Specific GHG emission factors that relate to

specific NAICS code categories have been applied to 80% of the Group’s suppliers by spend, with a NAICS code average emission

factor applied to the remaining 20% of suppliers by spend.

4 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.

5 Employee commuting to work GHG emissions are calculated using feedback from our 2025 colleague travel survey.

6 The GHG emissions from the vehicles that are financed by the Group are based on the number of live vehicle finance agreements

forthe 2025 reporting period. The methodology used to calculate these emissions aligns with the PCAF Standard which relates to

measuring and reporting scope 3 category 15 emissions. In calculating these emissions, we have assumed an average mileage of

7,100 miles per annum (2024: 12,000 per annum) based on the UK Government’s Department for Transport National Travel Survey

(August 2025) and used real-world category average emission factors published by Department for Energy Security and Net Zero.

Year on year changes in GHG emissions

The increase in the scope 1 GHG emissions we have reported is due to our reporting of fugitive

emissions from the air conditioning systems and units in our business premises for the first time in

2025. The reduction in our scope 2 emissions is due to the energy efficiency measure we continued

tointroduce in our offices during 2025. Finally, our use of the more accurate US Environmental

Protection Agency Economically Extended Input-Output methodology and Partnership for

CarbonAccounting Financials (PCAF) standard has resulted in our reported scope 3 category 1 and

scope 3 category 15 GHG emission increasing and reducing respectively.

Energy efficiency measures

Initiatives undertaken during 2025 to improve energy efficiency include the relocation of the

Bradfordhead office into smaller premises in September 2025, which has reduced energy consumption

and resource use; amending the heating and cooling parameters in all other offices in line with

accommodation rates; and reducing the business travel to our outsource partners in South Africa.

Data dependencies and limitations

Calculating our scope 3 upstream GHG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 has been done this year by

calculating the economic value of the goods and services we procure and multiplying this figure by

the Economically Extended Input-Output (EEIO) emission factors that have been published by the US

Environmental Protection Agency (EPA). The most up-to-date US EPA EEIO emission factors were

published in 2023. As a result, an inflation rate has been added to our economic value figure. While

these factors are more granular and regularly updated than the ones previously used, they can lead

to some volatility in the scope 3 category 1 GHG emissions data that is reported because of its

reliance on estimates and average emission factors. Also, our ability to identify, analyse, and monitor

GHG 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 GHG 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.

Calculating our scope 3 downstreamemissions

Our scope 3 category 15 GHG emissions, which relate to the vehicles financed by the Group are

calculated using a methodology that is aligned with the GHG Protocol and PCAF standard. This

methodology: considers only vehicles with outstanding loans that appear on the year-end balance

sheet; calculates an attribution factor (%) for each vehicle based on outstanding loan amount at

year end divided by the value of the vehicle at origination and is applied to the estimated annual

emissions of that vehicle to calculate the emissions that should be reported by the Group; anduses

an average mileage per year assumption of 7,100 miles which is based on the most recent National

Travel Survey carried out by the UK Government’s Department for Transport.

43 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Sustainability continued

2025 climate-related financial disclosure continued

Data dependencies and limitations

continued

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

these 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.

44 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Financial review

Dave Watts

Chief Financial Officer

Disciplined strategic execution in 2025 meant

theGroup was able to deploy capital to deliver

accelerated balance growth, while returning

toprofitability. This resulted in gross customer

interest-earning balances increasing 22%

to£2,824m.

The Group delivered a profit before tax from

continuing operations of £8.3m (2024: loss of

£138.0m) and a ROTE of 2.3% (2024: (32.1)%).

The Group optimised its capital structure

through a successful Additional Tier 1 (AT1)

issuance, which enabled the accelerated growth

in interest-earning balances.

Net interest margin reduced 1.7% to 16.8% as

planned, driven by the mix effect of growing

lower-margin, lower-risk Second Charge Mortgages.

Performance was supported by strong

creditquality, with customers demonstrating

financial resilience.

Management has continued to demonstrate

strong cost discipline, delivering £28.8m of

transformation cost savings in 2025.

The transformation of Vanquis continues to be

delivered and the Group has a credible pathway

to deliver low double-digit ROTE in 2026 and

mid-teens ROTE in2027.

Income statement

2025

£m

2024

(re-presented)

£m

Change

Interest income 567.2 549.9 3

Interest expense (148.8) (142.0) 5

Net interest

income 418.4 407.9 3

Non-interest

income 36.5 38.5 (5)

Total income 454.9 446.4 2

Impairment

charges (181.1) (185.3) (2)

Risk-adjusted

income 273.8 261.1 5

Operating costs (265.5) (399.1) (33)

Profit/(loss)

before tax

fromcontinuing

operations 8.3 (138.0)

Tax (charge)/

credit (0.3) 17.4

Profit/(loss)

after tax from

continuing

operations 8.0 (120.6)

Profit after tax

from discontinued

operations 0.7 1.3 (46)

Statutory profit/

(loss) after tax 8.7 (119.3)

AT1 distributions

(gross of tax) (0.5) — 100

Statutory profit/

(loss) attributable

to shareholders 8.2 (119.3)

Disciplined execution

driving balance

growth and a return

to profitability

1 The presentation of the income statement and selected key metrics in this report is consistent with that in the Annual Report and

Accounts for 31 December 2024, with the exception of the impact of the sale of the Personal Loans portfolio, which is now recognised as

a discontinued operation and the re-segmentation of interest income, interest expense and operating costs by product. Further details

are included in the 2024 re-presentation document at the following link: Vanquis-Banking-Group-2024-Re-presentation-Document.pdf.

45 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Financial review continued

Income statement continued

Certain alternative performance measures

(APMs) have been used in this report. See pages

196 to 198 for an explanation of their relevance

as well as their definition.

The Group has rationalised its use of APMs,

which are summarised on pages 196 to 198,

including an explanation of their relevance as

well as their definition.

Income

Total income increased 2% to £454.9m and net

interest income increased 3% to £418.4m,

reflecting balance growth and a disciplined

approach to pricing.

Interest income rose 3% to £567.2m, driven

bya13% increase in average gross customer

interest-earning balances to £2,495m. This was

partly offset by the mix effect of higher growth

in lower-risk, lower-margin Second Charge

Mortgages.

Asset yield decreased 1.8% to 21.0%, reflecting

the lower yield on Second Charge Mortgages.

Credit Cards yield reduced marginally due to

growth in 0% balance transfer and promotional

products, while Vehicle Finance yield improved.

Interest expense increased 5% to £148.8m,

reflecting increased funding requirements for

balance growth, partially offset by the lower

Bankof England (BoE) base rate, reduced rate

outlook and maturing fixed-term deposits being

refinanced with lower interest rate savings

products. Net interest margin reduced to 16.8%

(2024: 18.5%). Excluding Second Charge

Mortgages, NIM increased 0.5% to 19.4%,

evidencing continued pricing discipline.

Non-interest income decreased 5% to £36.5m,

reflecting lower late-fee income on Credit Cards.

Impairment

Impairment charges decreased 2% to £181.1m,

driven by the non-repeat of the prior year £15.1m

Vehicle Finance receivables review, partially

offset by increased impairment due to the 22%

increase in gross customer interest-earning

balances. Credit quality remained strong, with

gross charge-offs reducing 5% to £253.2m.

Net charge-offs post recoveries decreased 5%

to £203.2m.

Net risk movements resulted in a net impairment

increase of £171.4m, compared with £200.0m in

FY24. The improvement reflected continued

enhancements in underwriting and model

performance, movements in the macroeconomic

outlook and the changing portfolio mix.

Releases from write-offs and debt sales reduced

impairment by £183.5m (2024: £224.2m).

Cost of risk reduced 1.1% to 7.3%.

Risk-adjusted income increased 5% to £273.8m,

with risk-adjusted margin reducing 0.8% to 11.0%.

Operating costs

Operating costs decreased 33% to £265.5m.

The reduction reflected the non-repeat of

£111.7m of prior year notable items, including a

£71.2m goodwill write-off, £24.1m of

transformation and other exceptional costs, and

£10.2m relating largely to the legacy mobile app

write-off. The only notable item in 2025 was the

£3.0m provision for motor finance compensation.

Operating costs excluding notable items reduced

9% to £262.5m, driven by transformation savings

of £28.8m and £20.8m lower complaint costs.

These efficiencies more than offset growth and

inflation-related cost increases and higher

discretionary staff costs, having not paid

bonuses to staff in 2023 or 2024.

The cost-to-income ratio improved to 58.4%

(2024: 89.4%).

Profits

Profit before tax from continuing operations was

£8.3m (2024: loss of £138.0m).

Tax charge was £(0.3)m (2024: credit of £17.4m).

Profit after tax from continuing operations was

£8.0m (2024: loss of £120.6m).

Profit after tax from discontinued operations was

£0.7m (2024: £1.3m), reflecting the performance

of the Personal Loans portfolio in 1Q25 and a

small gain on sale. The sale completed at the

end of 1Q25.

Statutory profit after tax was £8.7m (2024: loss

of £119.3m).

Statutory profit after tax attributable to

shareholders was £8.2m (2024: loss of £119.3m),

after £0.5m of AT1 distributions (2024: £nil), resulting

in a statutory ROTE of 2.3% (2024:(32.1)%).

Summarised balance sheet

2025

£m

2024

£m

Change

Assets

Cash and cash

equivalents 805 1,004 (20)

Investment

securities 255 — 100

Amounts receivable

from customers

2,692 2,154 25

Pension asset 6 28 (79)

Goodwill and other

intangibles 66 63 5

Other assets 118 126 (6)

3,942 3,375 17

Liabilities

Retail deposits 3,020 2,428 24

Bank and other

borrowings

348 410 (15)

Trade and other

payables 52 46 13

Other liabilities 34 50 (32)

3,454 2,934 18

2 Amounts receivable from customers are presented net of

£0.2m (2024: £(0.9)m) fair value adjustment for portfolio

hedged risk. Underlying net receivables were £2,691.3m

(2024:£2,154.6m).

3 Bank and other borrowings in 2024 are presented net of

£0.2m (2024: £2.5m) fair value adjustment for hedged risk.

Underlying bank and other borrowings were £347.7m

(2024:£412.5m).

Total assets increased 17% to £3,942m, reflecting

the 25% increase in net receivables.

Cash and cash equivalents decreased 20% to

£805m, reflecting the reduction in BoE deposits

and replacement with purchases of UK

Government securities within the Liquid Asset

Buffer, as part of the strategy to diversify High

Quality Liquid Assets (HQLA). This drove the

increase in investment securities to £255m

(2024:£nil).

Net receivables increased 25% to £2,692m,

driven by growth in gross customer interest-

earning balances and a 7% reduction in

expected credit losses (ECL) to £244m.

Gross customer interest-earning balances

increased 22% to £2,824m, comprising:

5 Credit Cards: Balances increased 19% to

£1,518m, reflecting credit line increases for

existing customers and new customer

growth supported by the launch of new

product variants.

5 Vehicle Finance: Balances declined 8% to

£706m, reflecting the proactive management

of new business growth ahead of the 2026

launch of the new onboarding and servicing

platform under the Gateway transformation.

5 Second Charge Mortgages: Balances grew

to £599m (December 2024: £217m), driven

byforward-flow origination agreements

withpartners.

5 Personal Loans: Balances reduced to £nil

(December 2024: £49m) following the sale of

the portfolio at the end of 1Q25.

46 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Summarised balance sheet continued

The pension asset reduced to £6m (December 2024:

£28m), reflecting the results of the latest scheme

valuation and updated market assumptions.

Liabilities increased 18% to £3,454m, driven by

a24% increase in retail deposits (inclusive of

accrued interest) to £3,020m, supported by

continued optimisation of the retail funding mix,

broader product range including Individual

Savings Accounts (ISAs), and increased

distribution through the Snoop brand.

Bank and other borrowings decreased 15% to

£348m, due to the redemption of £58.5m of Tier 2

capital securities.

Capital

The CET1 capital ratio decreased 2.3% to 16.5%,

reflecting capital deployed to support accelerated

balance growth following the optimisation of the

Group’s capital structure through the successful

issuance of £60m of AT1 securities. Capital

accretion from statutory profit attributable to

shareholders, together with a 40bps benefit

from the sale of the Personal Loans portfolio,

was more than offset by a 13% increase in

RWAsto £2,073m.

The Tier 1 capital ratio increased 0.5% to 19.3%,

reflecting the £60m AT1 issuance, partially offset

by the movement in the CET1 ratio.

The total capital ratio decreased 3.6% to 26.1%,

mainly due to the reduction in the CET1 ratio, as

the AT1 issuance was largely offset by the

redemption of £58.5m of Tier 2 capital.

The Group’s leverage ratio was 12.1% (December

2024: 13.9%), remaining comfortably above the

minimum requirement.

Liquidity

The liquidity buffer totalled £998m (December 2024:

£947m), including approximately £250m invested

in UK gilts, with the remainder held in the BoE

reserve account. This resulted in excess liquidity

of £653m above the 100% liquidity coverage

ratio (LCR) minimum (December 2024: £667m)

and an LCR of 306% (December 2024: 359%).

Funding

Retail deposits increased 24% to £2,984m,

providing a stable source of funding at an

attractive cost relative to wholesale alternatives,

supported by a broader product range

designed to optimise the cost of funds.

The Group remains primarily funded by retail

deposits, representing 89.7% of total funding

including Tier 2 capital (December 2024: 85.6%).

Funding diversification continues to be

supported by Tier 2 capital, modest levels of

private securitisation secured by Vehicle Finance

assets, and access to central bank facilities

collateralised by Credit Card receivables.

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 2025 financial year,have been issued

concurrently with the Annual Report and

Accounts and can be found on the Group’s

website, www.vanquis.com.

Summary balance sheet and

financial metrics

Balance sheet

2025

£m

2024

£m

Change

Gross customer

interest-earning

balances 2,824 2,308 22

Average gross

customer

interest-earning

balances

(excluding

Personal Loans) 2,495 2,207 13

Gross receivables 2,935 2,416 21

Net receivables 2,691 2,155 25

Closing tangible

equity 358 358

Average tangible

equity 360 372 (3)

Selected key metrics

2025

2024

(re-presented)

Change

Asset yield 21.0% 22.8% (1.8)

Net interest

margin (NIM) 16.8% 18.5% (1.7)

Total income

margin (TIM) 18.2% 20.2% (2.0)

Cost of risk (7.3)% (8.4)% (1.1)

Risk-adjusted

margin (RAM) 11.0% 11.8% (0.8)

Cost: income

ratio 58.4% 89.4% (31.0)

Statutory ROTE 2.3% (32.1)% 34.4

Selected per

sharemetrics Pence Pence %

Basic earnings

pershare (EPS) 3.2 (46.7)

Dividend per

share (DPS) — — —

Tangible Net

Asset Value

(TNAV) per share 143 140 2

Capital, liquidity

andfunding metrics

2025

2024

Change

Common Equity

Tier 1 (CET1)

capital ratio 16.5 18.8 (2.3)

Risk-weighted

assets (RWAs) (£m) 2,073 1,835 13

High-quality liquid

assets (HQLA)

(£m) 998 947 5

Liquidity coverage

ratio (LCR) 306 359 (53)

Dave Watts

Chief Financial Officer

25 February 2026

Financial review continued

47 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Operating review

Segment analysis – Product contribution

2025

£m

Credit

Cards

Vehicle

Finance

Second

Charge

Mortgages

Corporate

Centre Total

Interest income 370.8 123.9 28.4 44.1 567.2

Interest expense (51.6) (28.2) (17.8) (51.2) (148.8)

Net interest income 319.2 95.7 10.6 (7.1) 418.4

Non-interest income 33.3 — 1.0 2.2 36.5

Total income 352.5 95.7 11.6 (4.9) 454.9

Impairment charges (139.6) (41.5) (0.7) 0.7 (181.1)

Risk-adjusted income 212.9 54.2 10.9 (4.2) 273.8

Operating costs (174.7) (66.9) (5.5) (18.4) (265.5)

Profit/(loss) before tax from

continuing operations 38.2 (12.7) 5.4 (22.6) 8.3

2024 (re-presented

)

£m

Credit

Cards

Vehicle

Finance

Second

Charge

Mortgages

Corporate

Centre Total

Interest income 365.7 133.1 4.8 46.3 549.9

Interest expense (53.2) (31.4) (3.4) (54.0) (142.0)

Net interest income 312.5 101.7 1.4 (7.7) 407.9

Non-interest income 35.0 — — 3.5 38.5

Total income 347.5 101.7 1.4 (4.2) 446.4

Impairment charges (123.9) (60.4) (0.2) (0.8) (185.3)

Risk-adjusted income 223.6 41.3 1.2 (5.0) 261.1

Operating costs (193.5) (80.1) (0.6) (124.9) (399.1)

Profit/(loss) before tax from

continuing operations 30.1 (38.8) 0.6 (129.9) (138.0)

1 The presentation of the income statement and selected key metrics in this report is consistent with that in the Annual Report and Accounts for 31 December 2024, with the exception of the impact of the

sale of the Personal Loans portfolio, which is now recognised as a discontinued operation and the re-segmentation of interest income, interest expense and operating costs by product. Further details

areincluded in the 2024 re-presentation document at the following link: Vanquis-Banking-Group-2024-Re-presentation-Document.pdf.

Product trading

performance

Detailed analysis of the product contribution to

the trading results of the Group can be found

onpage 48 for Credit Cards, page 49 for Vehicle

Finance, page 50 for Second Charge Mortgages,

and page 51 for Corporate Centre.

48 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Operating review continued

Credit Cards – Balances

returned to above 2023

levels, having improved the

quality of the portfolio

The Group’s Credit Cards business is a leading

player in the non-prime Credit Card market.

Ineach of the last three years, Vanquis has

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. While previously the business

offered a single credit card product, customers

are now offered a range of product choices.

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 excellent on Trustpilot,

based on over 40k reviews. We aim to make our

customer experience effortless, and these results

demonstrate the progress we have made.

Vanquis Trustpilot rating:

4.3 Excellent

12 months ended 31 December

2025

£m

2024

(re-presented)

£m

Change

Total customer numbers (’000) 1,339 1,267 6

Gross customer interest-earning balances 1,518 1,278 19

Average gross interest-earning balances

1,367 1,313 4

Gross receivables 1,554 1,310 19

Net receivables 1,384 1,150 20

Interest income 370.8 365.7 1

Interest expense (51.6) (53.2) (3)

Net interest income 319.2 312.5 2

Non-interest income 33.3 35.0 (5)

Total income 352.5 347.5 1

Impairment charges (139.6) (123.9) 13

Risk-adjusted income 212.9 223.6 (5)

Operating costs (174.7) (193.5) (10)

Profit before tax contribution 38.2 30.1 27

Asset yield

27.1% 27.9% (0.8)

Net interest margin

23.3% 23.8% (0.5)

Total income margin

25.8% 26.5% (0.7)

Cost of risk

(10.2)% (9.4)% (0.8)

Risk-adjusted margin

15.6% 17.0% (1.4)

Cost: income ratio

49.6% 55.7% (6.1)

2 Average of gross customer interest-earning balances for the 12 months ended 31 December using a 13-point month-end average.

3 Interest income from customer receivables for the 12 months ended 31 December as a percentage ofaverage gross customer

interest-earning balances.

4 Net interest income for the 12 months ended 31 December as a percentage of average gross customer interest-earning balances.

5 Total income for the 12 months ended 31 December as a percentage of average gross customer interest-earning balances.

6 Impairment charges for the 12 months ended 31 December as a percentage of average gross customer interest-earning balances.

7 Total income less impairment charges for the 12 months ended 31 December as a percentage of average gross customer

interest-earning balances.

8 Operating costs as a percentage of total income for the 12 months ended 31 December.

Financial performance

Total customer numbers increased 6% to 1,339k,

reflecting a return to growth from 2Q25

following a comprehensive review of customer

cohorts by risk profile, vintage and acquisition

channel to ensure the future sustainable

profitability of the portfolio.

Gross customer interest-earning balances

increased 19% to £1,518m, reflecting both credit

line increases of existing customers and new

customer growth following the release of new

product variants.

Net receivables increased 20% to £1,384m,

reflecting the growth in gross customer

interest-earning balances and a smaller 6%

increase in ECL to £170m, driven by a better

quality portfolio, with increased balances in

Stage 1 and 2 and a reduction in Stage 3 balances.

Total income increased 1% to £352.5m. Net interest

income rose 2% to £319.2m, with non-interest

income decreasing 5% to £33.3m. Net interest

margin decreased 0.5% to 23.3% and total

income margin decreased 0.7% to 25.8%.

Interest income increased 1% to £370.8m,

relativeto a 4% rise in average gross customer

interest-earning balances to £1,367m. Asset yield

reduced 0.8% to 27.1%, driven by growth in 0%

balance transfers (BTs) and promotional products,

partially offset by risk-based repricing initiatives.

Interest expense decreased 3% to £51.6m, driven

by lower cost of funds as the reduced rate outlook

and maturing fixed-term deposits were refinanced

with lower interest rate savings products.

Non-interest income decreased 5% to £33.3m,

reflecting lower late-fee income.

Impairment charges increased 13% to £139.6m,

driven by the 19% growth in gross customer

interest-earning balances. Gross charge-offs

reduced 19% to £174.2m and net charge-offs

post recoveries reduced 20% to £132.3m,

reflecting the better quality of the portfolio.

Costof risk increased 0.8% to 10.2%.

Risk-adjusted income decreased 5% to £212.9m

and risk-adjusted margin reduced 1.4% to 15.6%.

Operating costs decreased 10% to £174.7m,

driven by transformation cost savings and lower

complaint costs, more than offsetting growth

and inflation-driven cost increases and an

accrual for discretionary staff costs.

Profit before tax contribution increased 27%

to£38.2m.

The Vanquis Card helped me

to rebuild my credit rating,

which went from fairto

excellent over threeyears.

The app is verygood and

user friendly.No hesitation

in recommending Vanquis.”

Vanquis customer

Find out more on our website:

vanquis.com

49 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Operating review continued

Vehicle Finance – Proactively

managed new business

growth in 2025 while we

build the new onboarding

and serving platform

12 months ended

31December

2025

£m

2024

(re-presented)

£m

Change

Total customer

numbers (’000) 103 110 (6)

Gross customer

interest-earning

balances 706 765 (8)

Average gross

customer

interest-earning

balances 737 825 (11)

Gross receivables 762 832 (8)

Net receivables 689 735 (6)

Interest income 123.9 133.1 (7)

Interest expense (28.2) (31.4) (10)

Net interest

income 95.7 101.7 (6)

Non-interest

income — — —

Total income 95.7 101.7 (6)

Impairment

charges (41.5) (60.4) (31)

Risk-adjusted

income 54.2 41.3 31

Operating costs (66.9) (80.1) (17)

Loss before tax

contribution (12.7) (38.8) (67)

Asset yield 16.8% 16.1% 0.7

Net interest margin 13.0% 12.3% 0.7

Total income

margin 13.0% 12.3% 0.7

Cost of risk (5.6)% (7.3)% 1.7

Risk-adjusted

margin 7.4% 5.0% 2.4

Cost: income ratio 69.9% 78.8% (8.9)

The Group’s Vehicle Finance business,

Moneybarn, is a significant player in the

non-prime UK vehicle finance market.

The business consists of experts in helping

customers to access finance when they might

have struggled to get approval from mainstream

lenders. Vehicle Finance customers represent one

in five UK adults who have a poor credit history

but need a reliable car, motorbike or van to suit

their lifestyle and financial situation. Our core

product is a Conditional Sale Agreement, which

is a type of vehicle finance that helps spread the

cost of a used vehicle over time, instead of

paying for it all upfront. This is different to the

other types of vehicle finance, like Hire Purchase

(HP) or Personal Contract Purchase (PCP), as a

Conditional Sale Agreement has no additional

fee to own the vehicle; once the customer has

made the final repayment, they legally own the

vehicle. A Conditional Sale Agreement uses a

fixed APR, so monthly payments are predictable

and remain the same for the duration of the

agreement, which is typically between 36

and60months.

Good customer outcomes are important to us,

and once a customer is with us, we’re focused

onhelping them to achieve the best outcomes

possible, whether that’s simply paying their

finance each month until they own their used

vehicle, or by supporting them if they’re able to

settle their agreement early. We also understand

that customers may experience difficulties during

their agreement, and we’re focused on supporting

them should that happen. We have arange of

options that allow us to help customers get back

on track, or to otherwise exit the agreement in

the ‘best way possible’. From a service rating

perspective, Moneybarn israted excellent on

Trustpilot, based on nearly16k reviews.

Financial performance

Total customer numbers decreased 6% to 103k,

reflecting proactively managed new business

growth in the near term in advance of the new

onboarding and servicing platform being delivered

in 2026 as part of the Gateway technology

transformation programme. A new lending

decision engine was introduced in 2025, enabling

a more granular level of portfolio segmentation

and delivering a stronger platform to optimise

higher-margin customer segments.

Gross customer interest-earning balances

decreased 8% to £706m, driven by the proactive

management of new business growth.

Net receivables decreased 6% to £689m,

reflecting the reduction in interest-earning

balances and a 25% reduction in ECL to £73m.

ECL reduced across stages given the reduction

in balances.

Total income decreased 6% to £95.7m, which

represented all net interest income. Net interest

margin and total income margin both increased

0.7% to 13.0%.

Find out more on our website:

vanquis.com

Contacted Moneybarn

about finance. Got a

decision in minutes.

Afterfourdays I had

mycarsitting in my drive.

Excellent service10/10.”

Moneybarn customer

Interest income decreased 7% to £123.9m,

consistent with an 11% reduction in average

gross customer interest-earning balances to

£737m. The asset yield increased 0.7% to 16.8%,

driven by repricing initiatives.

Interest expense reduced 10% to £28.2m, driven

by the lower funding need and lower cost of

funds, as the reduced rate outlook and maturing

fixed-term deposits were refinanced with lower

interest rate savings products.

Impairment charges decreased 31% to £41.5m,

reflecting the non-repeat of the £15.1m prior

year impact of the Vehicle Finance receivables

review and reduced impairment from the 8%

reduction in gross customer interest-earning

balances. Cost of risk reduced 1.7% to 5.6%.

Risk-adjusted income increased 31% to £54.2m

and risk-adjusted margin improved 2.4% to 7.4%.

Operating costs decreased 17% to £66.9m,

driven by transformation cost savings, more

than offsetting growth and inflation-driven cost

increases and an accrual for discretionary

staffcosts.

Loss before tax contribution was £12.7m

(2024:£38.8m).

Moneybarn Trustpilot rating:

4.4 Excellent

50 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Operating review continued

Second Charge Mortgages

– Continued strong growth

in a growing market in 2025

12 months ended

31December

2025

£m

2024

(re-presented)

£m

Change

Total customer

numbers (’000) 9.9 3.7

Gross customer

interest-earning

balances 599 217

Average gross

customer

interest-earning

balances 391 69

Gross receivables 619 226

Net receivables 619 225

Interest income 28.4 4.8

Interest expense (17.8) (3.4)

Net interest

income 10.6 1.4

Non-interest

income 1.0 —

Total income 11.6 1.4

Impairment

charges (0.7) (0.2)

Risk-adjusted

income 10.9 1.2

Operating costs (5.5) (0.6)

Profit before tax

contribution 5.4 0.6

Asset yield 7.3% 7.0% 0.3

Net interest margin 2.7% 2.0% 0.7

Total income

margin 3.0% 2.0% 1.0

Cost of risk (0.2)% (0.3)% 0.1

Risk-adjusted

margin 2.8% 1.7% 1.1

Cost: income ratio 47.4% 42.9% 4.5

The Group’s Second Charge Mortgages business

offers this product to customers via origination

partnership agreements with Interbridge

Mortgages and Selina Finance. The launch of

these partnership arrangements occurred in

May 2024.

A second charge mortgage, sometimes referred

to as a homeowner loan, is a way for customers

to borrow additional money when they already

have a mortgage. They can then use the

additional loan to make home improvements,

consolidate debts or help complete a project.

Financial performance

Total customer numbers increased to 9.9k

(December 2024: 3.7k) following the successful

growth of the forward-flow agreement with

Interbridge Mortgages and expanded

partnership with Selina Finance.

I cannot praise highly

enough the service that

Ireceived from the

Interbridge team. From the

initial introduction to final

completion the process has

been nothing but positive.

The communication was

clear, and the options

clearly explained.

Highlyrecommended.”

Interbridge Mortgages customer

Gross customer interest-earning balances

increased to £599m (December 2024: £217m)

and net receivables increased to £619m

(December 2024: £225m), which includes

deferred acquisition costs.

Total income increased to £11.6m (2024: £1.4m).

Net interest margin was 2.7% and total income

margin was 3.0%.

Interest income increased to £28.4m (2024: £4.8m)

with an asset yield of 7.3%. Interest expense

was£17.8m (2024: £3.4m).

Risk-adjusted income increased to £10.9m

(2024:£1.2m), including impairment charges of

£0.7m (2024: £0.2m). Cost of risk was 0.2%

andrisk-adjusted margin was 2.8%.

Operating costs were £5.5m (2024: £0.6m),

reflecting the limited fixed costs associated with

the business given the origination partnership

arrangements in place.

Profit before tax contribution was £5.4m

(2024:£0.6m).

Interbridge Mortgages Trustpilot rating:

4.9 Excellent

Selina Finance Trustpilot rating:

4.7 Excellent

Find out more on our website:

vanquis.com

Fantastic service. Super

easy and helpfully guided

application process. Kept

informed of progress at

every step. All queries

promptly, cheerfully and

knowledgeably responded

to. I couldn’t have asked

fora more positive and

pleasant experience.”

Selina Finance customer

51 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Operating review continued

Corporate Centre

12 months ended

31December

2025

£m

2024

(re-presented)

£m

Change

Interest income 44.1 46.3 (5)

Interest expense (51.2) (54.0) (5)

Net interest

income (7.1) (7.7) (8)

Non-interest

income 2.2 3.5 (37)

Total income (4.9) (4.2) (17)

Impairment

charges 0.7 (0.8) (188)

Risk-adjusted

income (4.2) (5.0) (16)

Operating costs (18.4) (124.9) (85)

Loss before tax

contribution (22.6) (129.9) (83)

Corporate Centre includes the retail savings business,

including related costs, unallocated Treasury result

after product allocations, Snoop income and costs

and other immaterial or central items.

Financial performance

Total income was a net expense of £(4.9)m (2024:

£(4.2)m), with net interest income being a net

expense of £(7.1)m (2024: £(7.7)m) and non-interest

income decreasing to £2.2m (2024: £3.5m).

Interest income of £44.1m (2024: £46.3m)

represented returns from the liquid asset buffer

(LAB), including UK gilts and interest on cash

reserves in the BoE reserve account.

Interest expense of £51.2m (2024: £54.0m)

represented residual funding costs not allocated

to the respective businesses, including

unallocated Tier 2 capital.

Operating costs reduced to £18.4m (2024: £124.9m),

reflecting the non-repeat of £111.7m of prior year

notable items. The only notable item in 2025 was the

£3.0m provision for motor finance compensation.

Loss before tax contribution was £(22.6)m

(2024:£(129.9)m).

Snoop – helping customers track

spend, budget and save money

Snoop is an award-winning fintech that uses

Open Banking and Expand AI to help users

savemoney and manage their finances more

effectively. The app helps customers build their

financial capability and targets annual savings

of up to £1,500. Snoop demonstrably improves

financial wellbeing with over 13k four and

five-star reviews. As such, it is an important

partof the Group’s customer proposition.

Leveraging Snoop’s innovative technology and

data capabilities is also unlocking valuable

opportunities for the Group. This included the

launch of an Easy Access Savings proposition

embedded within the Snoop app at the end of

2024. The Group also continues to actively

promote Snoop to the Vanquis customer base.

This helps position the Group as a relevant

presence in their daily lives, drive improved

creditworthiness and support improved

borrowing and debt management.

Snoop’s impact extends beyond individual users,

offering businesses valuable insights into evolving

consumer spending behaviours. Further scaling

the business will enrich Snoop’s data insight

proposition and enhance the Group’s overall

data capabilities.

Vanquis is also significantly leveraging the

capabilities and skills of the acquired Snoop

team to lead various aspects of the Group’s

transformationprogramme.

Snoop App Store rating:

4.6

Snoop Google Play rating:

4.5

Find out more on our website:

vanquis.com

My wife and I recently

opened cash ISAs with

Vanquis, which involved

transfers from another

provider. The whole

processwas simple and

straightforward with good

communication throughout.

Interest rates offered

werevery competitive.

Highly recommended.”

Savings customer

I’m so glad I switched to

Snoop! This app offers

muchbetter features, more

powerful spend tracking

and analysis, excellent

weekly and monthly insight

reports and I love the bill

protector feature. If you

want spend tracking and

insights, this is without

adoubt the best app

I’veused!”

Snoop customer

52 – Vanquis Banking Group plc Annual Report and Accounts 2025

Strategic report Shareholder informationFinancial statementsGovernance

Section 172(1) statement

The Board of Directors confirms that in

performing its duties during 2025 it has acted in

good faith, in a manner which would be most

likely to promote the success of the Company for

the benefit of its members, and with regard to

the matters set out in section 172(a)–(f) of the

Companies Act 2006 (s.172).

Board decision making

Reports being presented to the Board for a

decision are required to consider and document

the impact on the Group’s stakeholders. Building

this requirement into the Board reporting helps

ensure that Board directors assess proposals in

line with their duties under s.172 consistently, as

well as supporting management to ensure that

it has considered all stakeholder implications

with each proposal being put forward, recognising

that stakeholder interests are not always aligned.

Principal decisions taken by the Board are

detailed on pages 70, 75 and 77; these showcase

the decision-making process and the Board’s

considerations when reaching its conclusion.

The Board adopted different approaches to

perform its duties including: establishing the

long-term strategic direction and affirming the

Group’s purpose; receiving reports from

corporate advisors and brokers; considering

strategic reports and macroeconomic updates;

and considering the colleague value proposition

to attract and retain talent.

Our stakeholders, how we’ve engaged with

them during 2025 and the outcomes of this

engagement can be found on pages 21 to 23.

Further examples of how the directors have

discharged their responsibilities under s.172 are

integrated throughout the Strategic Report and

Governance Report; please see the table

opposite for references.

Section 172 provision Relevant disclosure Pages

(a) The likely

consequences

ofanydecision

inthelong term

Chairman’s Statement 4–6

Strategy 14–15

Non-financial and sustainability

information statement 53

Risk management and principal risks 54–61

Viability statement 62

Board focus areas during 2025 71–72

(b) The interests

of the Company’s

employees

CEO’s Review 7–9

Sustainability 21–31

Board focus areas during 2025 71–72

The Board: our culture 73

Stakeholder engagement

anddecisionmaking 74

the Company’s

business relationships

withsuppliers,

customers

and others

Who we are 2–3

Strategy 14–15

Sustainability 21–32

Stakeholder engagement

and decision making 74–77

Engagement with shareholders 78

(d) The impact of

theCompany’s

operations on the

community and

theenvironment

Strategy 14–15

Sustainability 21–43

Non-financial and sustainability

information statement 53

Risk management and principal risks 54–61

(e) The desirability

oftheCompany

maintaining a

reputation for

highstandards of

business conduct

Chairman’s Statement 4–6

Market overview 10–13

Sustainability 21–43

Risk management and principal risks 54–61

Audit Committee Report 86–90

Risk Committee Report 91–94

(f) The need to act

fairlyas between

members of the

Company

Setting our strategy 70

Stakeholder engagement

and decision making 74–77

Board focus areas during 2025 71–72

Directors’ Remuneration Report 95–122

53 – Vanquis Banking Group plc Annual Report and Accounts 2025

Strategic report Shareholder informationFinancial statementsGovernance

Non-financial and sustainability information statement

Reporting requirement Description Relevant Vanquis policies and further information Page references

Business model The Group’s purpose is to deliver caring

banking so our customers can make the most

of life’s opportunities.

Not applicable. Our business model: pages 16 and 17

Principal risks and

impact of business

activity

Our risk management and internal control

framework sets out how we manage risk

consistently across the Group, including

thegovernance structures and roles and

responsibilities that support effective oversight.

The risk management and internal control framework, Credit Risk Policy, Customer

Risk Policy, Environmental and Climate Change Risk Policy, Funding and Liquidity

Risk Policy, Wholesale Counterpart Credit Risk Policy, and Third-Party Risk

Management Policy.

Risk management and principal risks:

pages 54 to 61

Audit Committee Report: pages 86 to 90

Risk Committee Report: pages 91 to 94

Non-financial KPIs A range of non-financial KPIs are reported

toGroup management on a monthly basis

tosupport strategic decision making.

Not applicable. Strategy: pages 14 and 15

Key Performance Indicators: pages 18 to 20

Sustainability: pages 21 to 43

Our colleagues We are committed to building and sustaining

an inclusive workplace culture, where all our

colleagues can be themselves and thrive.

Thisensures that we are best placed to

deliver for the diverse customer base

weserve.

People Policy, Inclusion and Diversity Policy, Family Friendly Policy, Mental Health

and Wellbeing Policy, Health and Safety Policy, Modern Slavery and Human Rights

Policy, and Whistleblowing Policy.

Sustainability: pages 21 to 43

Stakeholder engagement and decision

making: pages 74 to 78

Nomination and Governance Committee

Report: pages 84 and 85

Directors’ Remuneration Report: pages 95

to 122

Respect for human

rights

The Group is committed to supporting and

respecting human rights and, as such, is

opposed to slavery and human trafficking in

both its direct operations and in the indirect

operations of its supply chains.

Modern Slavery and Human Rights Policy, Supplier Code of Conduct, Third-Party

Risk Management Policy and Modern Slavery Act Statement (pursuant to section

54(1) of the UK Modern Slavery Act 2015, Vanquis produces a Modern Slavery

Statement, see www.vanquis.com).

Sustainability: pages 21 to 43

Directors’ Report: pages 123 to 128

Social matters Through the Vanquis Foundation, we are

committed to improving the lives of children

and young people by providing educational

and social development opportunities which

support financial and social inclusion.

People Policy, Community Involvement Policy and Volunteering and Matched

Funding Policy.

Sustainability: pages 21 to 43

Anti-bribery and

anti-corruption

The Group has a zero-tolerance approach to

acts of bribery and corruption. We also always

seek to protect our customers, colleagues and

other key stakeholders from financial crime.

Anti-Bribery and Corruption Policy, Corporate Hospitality Policy,

WhistleblowingPolicy.

Directors’ Report: pages 123 to 128

Environmental

matters, including

climate-related

disclosures

We seek to minimise our environmental impacts

and work with others to take action on the

globally important issue of climate change.

Environmental and Climate Change Risk Policy and Supplier Code of Conduct. Sustainability: pages 21 to 43

Directors’ Report: pages 123 to 128

The following table summarises where you can find further information on each of the key areas of disclosure required by sections 414CA and 414CB of

the Companies Act 2006.

54 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Risk strategy

Risk culture

Risk management and internal control framework

The risk management and internal control

framework (RM&ICF) sets out how we manage

risk consistently and compliantly across the

Group, including the governance structures,

roles and responsibilities that support effective

oversight. Its components operate together

toprovide the architecture through which we

monitor our risk exposures and gain assurance

over the strength of our control environment.

The RM&ICF supports timely escalation of

material risks and aggregated reporting to the

Group’s Board, Risk Committee and executive

management, ensuring that the most significant

implications for the Group’s strategy and

operations are clearly understood and to

informdecision making.

The new Provision 29 requirements introduced by

the UK Corporate Governance Code 2024 have

emphasised the need for the Board to establish

and maintain the effectiveness of the RM&ICF,

including the Group’s material controls (see the

Risk Committee Report on pages 91 to 94).

Material controls form a key part of the RM&ICF,

supporting the Group’s ability to manage risk

and ensuring the integrity of both financial

andnon-financial reporting.

Annually, the Risk function assesses the

effectiveness of the RM&ICF and seeks to

enhance it to enable proactive risk management

and embed a risk-aware culture. The

fundamental components are illustrated:

Risk management and principal risks

Vanquis strategy

External and regulatory environment

A robust risk

management framework

and culture

We have continued to embed a strong risk-aware culture and a

well-established control environment across Vanquis. As we move into

thenext phase of growth, our focus is on converting our transformation

progress into sustainable long-term value for shareholders.”

Joe Sweeney

Chief Risk Officer

Risk management and internal control framework

Assurance and oversight

Risk reporting and monitoring

Risk governance

Risk taxonomy

Risk appetite

Risk measurement criteria

Risk and control self-assessment

Emerging risks Risk events

Risk

acceptances

55 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Risk management and principal risks continued

Risk appetite

The Group defines its risk appetite as the

amountand type of risk it is prepared to seek,

accept or tolerate as we pursue our goals

without threatening our safety. Setting this clearly

helps us make decisions aligned with our strategic

vision and within prescribed boundaries, such

asour regulatory and legal landscape.

We have refreshed our Board-approved Risk

Appetite Framework (RAF) for 2026 to

strengthen alignment between strategic

oversight, resilience and operational execution.

Board-level metrics define the overarching risk

boundaries, while management-level metrics

and supporting early warning indicators

translate them into actionable controls and

support accountability and consistent risk

taking. If these are breached, we are prompted

to review and potentially adjust our approach.

Together, these mechanisms create a structured

escalation framework, promote early

intervention, support consistent decision making

and help maintain stakeholder confidence.

Risk taxonomy

Our risk taxonomy captures our principal risks

and their corresponding level 1 risks across our

four risk pillars, which support the delivery of our

strategic risk objectives. Each risk is allocated

anexecutive owner, in line with the process risk

ownership and reinforcing operational and

regulatory responsibilities. Our risk taxonomy is

reviewed on an annual basis to ensure that the

risks remain up to date, comprehensive and

reflective of our high-level exposures.

During the year, we have simplified our risk

universe to remove duplication and improve

efficiency. We introduced a clearer, owner-led

framework that strengthens accountability and

supports more forward-looking risk discussions.

This gives the Executive better oversight of level 1

risks, with the Executive Risk Committee focused

on changes in risk profile, emerging pressures

and future priorities. The approach directs

attention to the most material risks, guided by

data-driven assessment and a proactive view

ofthe evolving risk landscape.

Emerging risks

We recognise the changing landscape we

operate in so capture our emerging risks in a

radar to anticipate adverse scenarios from

potential threats and proactively prepare,

recover and adapt. We consider external

factors, such as political, economic, social and

technological, which complement existing

regulatory and prudential horizon scanning

processes. Each emerging risk is assessed for its

proximity and velocity and the radar presented

through the risk governance structure.

Risk culture

Our risk culture is imperative in driving the

rightoutcomes as a business for all our key

stakeholders. The RM&ICF places significant

emphasis not just on what we deliver, but how

itis delivered in the level of risk we are willing

totake.

The following components assist in promoting

astrong risk culture within our Group:

Culture driver Description

The Group’s

business model

Alignment between the

Group’s profit incentives

andgood customer and

stakeholder outcomes.

The Vanquis Way The Vanquis Way reflects the

unique culture and working

environment we want to create

for the Group. It guides our

decisions and reminds us

ofwhat is important when

wework with customers,

communities and colleagues.

Individual

accountability

and

performance

management

Colleagues are aware of their

accountabilities in managing

risk and these are embedded

in role descriptions and

performance objectives

(financial and non-financial).

Remuneration Senior leaders are incentivised

consistently with the Board’s

stated risk culture to drive

faircustomer and other risk

outcomes. A risk adjustment

process is in place, reinforced

through the Senior Managers

and Certification Regime

(SMCR).

Skills and

capabilities

There are sufficient skilled and

trained resources to deliver

against business expectations.

1 – Maintaining a secure and efficient

capital and funding structure.

2 – Delivering sustainable growth and

returns to our shareholders.

3 – Optimising our reputation and

becoming the most trusted and inclusive

bank for our target customers.

4 – Establishing a strong risk and

customer-led culture.

5 – Managing execution risk associated

with strategic and operational

changeactivity.

6 – Maintaining operational resilience

andbusiness capabilities.

Risk strategy

Managing risk is critical to enable us to optimise

our shareholder return whilst maximising our

business opportunities, achieving our strategic

objectives and delivering positive outcomes

forall our key stakeholders, which include

shareholders, customers, colleagues and

regulators. It is underpinned by six strategic

riskobjectives:

In 2025, we provided robust oversight and strategic guidance to our

transformation programmes, building onthe stabilisation and efficiency

gains achieved in 2024. Our efforts have supported the delivery of

improved operational performance, sustainable customer growth,

enhancedcustomer experience and disciplined capitalallocation.”

Joe Sweeney

Chief Risk Officer

56 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Risk management and principal risks continued

Risk and control assessment,

monitoringandreporting

We apply a standardised and consistent

approach to identify, assess, measure and

regularly review the risks and supporting control

environment, driven by the Risk and Control

Self-Assessment (RCSA), risk event and risk

acceptance processes.

Ongoing monitoring allows us to track shifts in

risk levels and see how effective our controls

are. Reporting these findings at all levels

supports transparency, enabling quick, informed

decision making. This approach supports

prioritisation of risks requiring enhanced

management attention.

Risk governance

The Group maintains a governance committee

structure that underpins effective risk

management and oversight. Our refreshed risk

governance framework strengthens our ability

to identify, assess, manage and report risks,

while enabling a proactive response to evolving

internal, external and regulatory environments.

The Executive Risk Committee plays a central

role in supporting the Risk Committee by

overseeing the management of current and

emerging risks. The Board retains overall

responsibility for effective risk management.

Supporting these, specialist committees are in

place to monitor principal risks and uncertainties,

ensure the strength of the control environment

and escalate matters appropriately through the

risk governance structure.

Integrated assurance

andaccountability

The Group applies a three lines of defence

model to support effective risk management

and internal control. This clarifies accountability

and supports a consistent approach to

identifying, managing and assuring risks.

The first line of defence is responsible for owning

and managing risks on a day-to-day basis,

including the design and operation of controls

within agreed risk appetite. The second line

establishes the RM&ICF and provides

independent oversight and challenge, while the

third line delivers independent and objective

assurance to the Board and management.

Together, the three lines provide a structured

basis for accountability and oversight,

supporting the Board’s understanding of the

effectiveness of the Group’s control environment

and alignment with good governance practice.

An Integrated Assurance Framework (IAF)

operates across the Group to coordinate

assurance activity, aligning the planning,

execution and issue management activities of

assurance providers across the three lines of

defence. This approach is designed to reduce

duplication, focus assurance on the most

material risks and controls and improve the

clarity of assurance reporting to management

and the Risk Committee.

Material controls form a key input to the IAF.

They provide a foundation for proportionate,

risk-based assurance activities, supporting the

Board in forming a view on control effectiveness.

The IAF is supported by an integrated risk

management system, which facilitates visibility

ofrisks, controls, issues and assurance activity.

This approach supports informed decision

making, early identification of control weaknesses

and timely remediation where required.

57 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Principal risks and uncertainties

Our top current and emerging risks and how we are managing these are summarised over the next few pages.

Risk Pillar 1: Customer and conduct

We deliver fair customer outcomes and meet the expectations of our regulators.

Principal risk

Customer

The risk that failing to understand or

address customer needs could lead to

dissatisfaction, poor customer outcomes,

reduced loyalty, and reputational

damage, impacting revenue and

long-term business sustainability.

Links to strategic themes

Links to KPIs

Key considerations

The 2025 annual Consumer Duty Board Report demonstrates continued progress in embedding Consumer Duty across the Group. We are committed to continuously monitoring and improving customer outcomes,

better understanding our target market and serving the needs of our customers, intrinsic to its strategy and culture. This focus is emphasised by the retention of Consumer Duty Champion to maintain strong Board-level

oversight and engagement on this topic.

Complaints related to responsible lending have declined since the implementation of the FOS fee-charging structure with a negligible amount of Vanquis-related claims management company complaints referred

toFOS. Following the FCA’s consultation on motor finance redress, the business still faces potential customer complaints.

Mitigating actions

5 Customer outcomes monitoring continues to be enhanced through clearer, segmented data insights across all products.

5 Customer support strategies and arrears and forbearance approaches have been revised to comply with revised FCA regulation to ensure customers with additional needs or financial difficulty receive timely,

appropriate support.

5 Fair value assessments are conducted at least annually, or when triggered by specific events, as a core element of product reviews to ensure pricing and value remain appropriate, transparent and aligned to

customer interests.

5 A strengthened complaints framework has improved first point resolution and deepened root cause analysis, driving more effective long-term customer solutions.

Regulatory

The risk that non-compliance with

allregulatory and legal requirements

and expectations could lead to financial

penalties, legal action, operational

disruptions and long-term damage

toreputation.

Links to strategic themes

Key considerations

The FCA published a consultation on a Scheme of Arrangement to redress customers affected by potentially unfair motor finance commission practices. Moneybarn has never participated in discretionary commission

arrangements or operated tied arrangements. A provision of £3.0m has been recognised (see the provisions note regarding motor finance redress on page 180), which has been reviewed by the Audit Committee

(seepages 86 to 90).

Our request for a judicial review, along with other credit providers, on the FOS interpretation of out of jurisdiction complaints has been accepted and we await hearing dates.

We have responded to the consultations underway to simplify and modernise aspects of the regulatory handbook and amend the Consumer Credit Act. While these reforms are designed to be beneficial, they may

nevertheless require significant implementation effort over the next 12 to 24 months.

Mitigating actions

5 We are actively involved in the Scheme of Arrangement consultation, lobbying for significant improvements to reduce our exposure and the operational costs in delivering the Scheme.

5 We maintain strong and proactive regulatory relationships with regular lines of communication established with both the FCA and PRA. The regulators have been kept informed of our strategic initiatives, key risk

management activities and responses to evolving regulatory developments.

5 The SMCR framework has been updated to align Vanquis and Moneybarn entities, creating a consistent approach to the allocation of Senior Management Functions (SMFs) and responsibilities. This alignment

strengthens process risk ownership within the RM&ICF, supported by the Group Delegated Authorities Manual. SMFs have formally attested to these responsibilities.

5 The new legislation arising from the Data (Use and Access) Bill, due to come into effect over the next 12 months, is under review to assess material changes and potential opportunities.

5 The Group continues to use scenario analysis to assess the potential impact of climate change on our business. Findings indicate that our strategy remains resilient to climate-related risks and opportunities. Further detail on

the governance, management of the climate-related risks and opportunities and our Task Force on Climate-related Financial Disclosures (TCFD) summary can be found from page 33.

Strategic themes

Customer-led Insightful risk

management

Efficient

organisation

Digital, tech, data

andanalytics

A great people

proposition

KPIs

Find our KPIs on pages 18 to 20

58 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Principal risks and uncertainties continued

Risk Pillar 1: Customer and conduct continued

We deliver fair customer outcomes and meet the expectations of our regulators.

Principal risk

Financial crime

The risk that failure to detect and

prevent financial crime and fraud could

result in customer detriment, regulatory

fines, reputational damage and

financial loss.

Links to strategic themes

Key considerations

The financial services industry continues to suffer from high levels of fraud. We have dedicated fraud and financial crime strategic and operational teams, which monitor, investigate and report suspicious activity to meet

regulatory obligations and protect us and our customers.

Focus during 2025 has been on progressing delivery of the new financial crime risk management system, as part of Gateway, to strengthen surveillance, enhance customer screening and improve the financial crime

control environment.

Mitigating actions

5 Application fraud detection systems have been upgraded with Machine Learning (ML) models and targeted behavioural rules. This has already increased our capability to identify fraudulent applications and

reduced fraud rates. Implementation for Vehicle Finance is underway, building on the success achieved in Cards.

5 The mobile app has been enhanced with functionality to detect suspicious activity providing customers with stronger protection.

5 Know Your Customer and onboarding controls have been strengthened through greater use of electronic and biometric checks, ensuring strengthened verification of new customers.

5 We are fully compliant with the new failure to prevent fraud offence, effective from 1September, ensuring accountability where internal fraud could benefit large organisations.

Risk Pillar 2: Financial

We manage our credit risk exposures, supported by financial strength and liquidity in normal and stressed conditions.

Principal risk

Capital

The risk that inadequate capital

resources or poor capital planning could

result in an inability to meet financial

obligations, regulatory breaches and

financial instability, potentially

threatening the long-term viability

oftheGroup.

Links to strategic themes

Links to KPIs

Key considerations

The Group and Bank maintain sufficient capital resources, both in terms of amount and quality, to support the business strategy and meet the stressed scenarios identified in the Internal Capital Adequacy Assessment

Process (ICAAP). Throughout the year, the Group and Bank have maintained capital ratios in excess of regulatory requirements (see the capital risk section on pages 154 and 155 for the Group’s capital position). The

Group has strengthened and optimised its capital position during 2025 through the £60m Additional Tier 1 Notes issuance and early repurchase of £58.5m of Tier 2 Notes, supported by a regulatory review of our capital

requirements. The Group will continue to monitor its capital allocation in 2026 to support its future growth.

As a Small Domestic Deposit Taker (SDDT), the Group is eligible for the simplified capital regime under the PRA’s strong and simple framework (Policy Statement 20/25).

Mitigating actions

5 The capital framework is reviewed by the Board as part of the annual ICAAP. The Assets and Liabilities Committee (ALCO) is responsible for managing the balance sheet structure, including the capital plan

anditsrisks.

5 Capital risk appetite metrics are reported monthly at ALCO meetings and quarterly to the Risk Committee and Board.

5 The Group and Bank maintain capital resources to meet Pillar 1 and Pillar 2 capital requirements as identified through the ICAAP, the most significant elements being credit andoperational risks.

5 We have constructive engagement with the PRA regarding our approach to capitalmanagement.

Strategic themes

Customer-led Insightful risk

management

Efficient

organisation

Digital, tech, data

andanalytics

A great people

proposition

KPIs

Find our KPIs on pages 18 to 20

59 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Principal risks and uncertainties continued

Risk Pillar 2: Financial continued

We manage our credit risk exposures, supported by financial strength and liquidity in normal and stressed conditions.

Principal risk

Funding and liquidity

The risk that the Group has insufficient

financial resources to meet its

obligations (cash or collateral

requirements) as they fall due, resulting

in the failure to meet regulatory liquidity

requirements, or is only able to secure

such resources at excessive cost.

Links to strategic themes

Links to KPIs

Key considerations

The Group and the Bank maintain sufficient liquid assets, both in terms of amount and quality, to meet daily cash flow needs and stressed scenarios driven by the Group’s own risk assessment and regulatory

requirements. Throughout the year, the Group and Bank have maintained funding and liquidity ratios in excess of regulatory requirements. Liquid assets have been diversified to comprise reserves held with the Bank of

England and UK Government bonds (gilts) (see the counterparty risk on page 152 and funding and liquidity risk section on pages 152 and 153).

The Group has in place a Core UK Group (CUG) waiver, which enables the Group to lend retail deposit funding raised in Vanquis Bank Ltd to Moneybarn.

As an SDDT, the changes to the regulatory framework under the strong and simple framework have not had a material impact on the Group’s liquidity requirements.

Mitigating actions

5 The funding and liquidity framework is reviewed by the Board as part of the annual Internal Liquidity Adequacy Assessment Process (ILAAP). The ALCO is responsible for managing the balance sheet structure,

including the funding plan and its risks.

5 Funding and liquidity metrics are monitored through daily liquidity reporting and reported monthly at ALCO meetings and quarterly to the Risk Committee and Board.

5 The Group and Bank maintain liquid assets in excess of the anticipated outflows and management buffers as assessed under internal stress test scenarios (90-day stress) and the regulatory prescribed liquidity

coverage ratio (30-day stress).

5 Funding diversification has been strengthened through the launch of new retail deposit products, while retained OBAN notes continue to provide a source of contingent liquidity following repayment of TFSME

drawings. The financial performance of Moneybarn is monitored to ensure that the conditions of the CUG waiver continue to be met.

Market

The risk that fluctuations in market

prices, such as interest rates, could

negatively impact the Group’s financial

performance, resulting in losses

ordisruptions.

Links to strategic themes

Links to KPIs

Key considerations

The Group and Bank are primarily exposed to Interest Rate Risk in the Banking Book (IRRBB) and do not take significant unmatched positions or operate trading books. The Group and Bank have remained within risk

appetite throughout the year (see the market risk section on page 154).

Mitigating actions

5 The market risk framework is reviewed by the Board as part of the annual market risk assessment process. The ALCO is responsible for managing the balance sheet structure, including the methodology for

assessing and managing market risks.

5 Market risk appetite metrics are reported monthly at ALCO meetings and quarterly to the Risk Committee and Board. Metrics are set for earnings at risk, market value sensitivity, economic value of equity and basis

risk. This includes the risk under different interest rate risk scenarios as prescribed by regulation.

5 The Group continues to enhance its approach to market risk management, including commencing a project to implement a new assets and liabilities management system. As the Group navigates the changing and

competitive interest rate environment, pricing actions and behavioural profiles will be reviewed in the IRRBB assessment.

Credit

The risk that customers may default on

their obligations, leading to financial

losses, impaired asset quality and

reputational damage.

Links to strategic themes

Links to KPIs

Key considerations

Credit risk is fundamental to achieving our strategic objectives, with exposure arising at all stages of the customer lifecycle and varying in response to customer behaviour and macroeconomic factors (see the credit risk

section on page 152).

Following a change in leadership, a comprehensive credit risk programme was established in 4Q24 to optimise lending and support responsible growth across the portfolio. The programme is designed to be resilient,

compliant and aligned to Gateway transformation. The Risk Committee has been kept fully informed of progress, ensuring strong oversight and alignment with the Group’s risk appetite.

Mitigating actions

5 Specialist credit risk expertise has been recruited in the first and second lines of defence, strengthening capability and oversight. A dedicated programme manager has been appointed to support effective credit risk

programme delivery.

5 Portfolio credit risk is governed through the Credit Risk Committee, supported by regular monitoring against risk appetite and timely escalation where required.

5 The credit risk programme has been expanded to capture opportunities for improving collections and recoveries strategies. Enhancement include strengthening forbearance capabilities, optimising delinquency

collections and maximising post-charge-off recoveries.

5 Credit and affordability strategies continue to be enhanced to keep pace with changing market and economic conditions. These origination and existing customer management decisions are underpinned by data

with an increased use of internal behavioural scores to ensure ongoing fit for purpose credit offerings for the Vanquis customer.

60 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Principal risks and uncertainties continued

Risk Pillar 3: Operational

We ensure operational risk is minimised through effective people, processes and systems aligned to our strategic goals.

Principal risk

People

The risk that poor recruitment practices,

insufficient employee training or low

engagement levels, caused by poor

culture and compliance, could lead to

operational inefficiencies and

reputational damage.

Links to strategic themes

Links to KPIs

Key considerations

We have continued to deliver on our Great Place to Work

action plan to strengthen colleague engagement, recognising its importance in achieving our strategic objectives. This commitment was reflected

in our certification as a Great Place to Work

following the independent Colleague Survey conducted in October 2025. Our overall engagement score rose to 73%, up from 60% at the end of 2024,

demonstrating significant progress and highlighting our focus on flexibility, development and creating a workplace where colleagues feel valued, particularly during a year of substantial change activity,

underscoring the resilience of our culture and the effectiveness of our engagement initiatives. Further details can be found on page 28.

Mitigating actions

5 We launched ‘Your Vanquis’, our colleague offering that brings together our culture, values and purpose. It demonstrates how we support, recognise and invest in our teams, ensuring colleagues feel connected and valued.

5 Quarterly talent reviews are held with each ExCo member to address key retention risks and identify succession planning opportunities. These reviews are supported by management responsibilities maps and

succession plans for executive management and senior colleagues, ensuring clarity of accountability, resilience in leadership and continuity across the Group.

5 The LEAD Forum, comprising our most senior leaders across the business, is now embedded to champion and drive strategy implementation, foster our culture and help us provide agility in shaping and adjusting

our direction.

5 The Development Centre is established to enhance colleagues’ skills, performance and career progression through a suite of online learning and development tools.

Technology, information

security anddata

The risk that inadequate technological,

security and data infrastructure, and

failure to upgrade systems, could lead

tooperational inefficiencies, data

breaches, service disruptions, a lack

ofscalability and reputational damage.

Links to strategic themes

Key considerations

We have been making positive progress to deliver Gateway to implement a single, strategic technology platform, which addresses the risks associated with operating across three segregated and ageing technology

stacks. Delivery of the platform will provide a basis for technological growth and support wider strategic delivery, whilst securing the environment andreducing our technical debt. As our reliance on legacy technology

reduces, the number of incidents causing significant operational disruption has moderated and they predominantly impact legacy systems.

As we continue to explore the use of AI, ML and large language models, weneed to utilise them responsibly, balancing capability with ethical practices, data security and process integrity to enhance customer and

colleague experiences. Failing to adopt these technologies risks competitive disadvantage and increased vulnerability to AI-driven cyber threats due to insufficient knowledge or protection.

As part of our annual risk taxonomy review, we have expanded this principal risk title to encompass data. Given our increasing reliance on digital platforms, AI-enabled processes and data-driven decision making, the

underlying drivers of these exposures are fundamentally technological, making technology and information security the appropriate principal risk category for effective oversight and control.

Mitigating actions

5 A gap analysis against the Cyber Governance Code of Practice published by the Department for Science, Innovation and Technology (DSIT) is underway to enhance Board focus on cyber risk

governance, including resilience testing and supply chain oversight.

5 Cyber security controls continue to be strengthened through enhancements to endpoint protection, ransomware defences, additional tooling, monitoring and incident response capabilities.

5 The AI policy and framework continue to develop as we explore and integrate AI and ML technology into our processes to manage our risk exposure, including against data, security, regulatory and compliance standards.

5 The data transformation programme is progressing to simplify and consolidate all data across the business, resulting in a centralised and consistent dataset, improving the customer journey and operational efficiency.

P10

Operational

The risk that failures in processes,

systems or human error could result in

business disruptions, financial loss,

regulatory action, poor customer

outcomes and reputational damage.

Links to strategic themes

Links to KPIs

Key considerations

Operational risk is inherent to our activities and remains a key area of focus as we execute our strategy. We balance internal expertise with trusted, strategically selected outsourcing partners and

third-party suppliers to ensure resilient service delivery, while progressing transformation programmes that will establish a fit for purpose technology platform to support our operations. These initiatives

strengthen operational resilience andenhance customer outcomes.

Mitigating actions

5 Assurance activities encompass the delivery of key strategic programmes and their interdependencies, which are consistently managed through adherence to the change delivery framework.

5 Our operational resilience tool continues to embed, prioritising the supporting processes and infrastructure that underpin our Important Business Services (IBS) while advancing enterprise-wide response and recovery planning.

5 Scenario testing is ongoing to identify vulnerabilities, with findings informing the 2026 operational resilience self-assessment and remediation plans as continuous improvement.

5 Oversight of material outsourcers and critical third parties and suppliers, who directly impact IBS, remains a priority. These relationships are subject to ongoing monitoring and performance programmes in line with

the third-party risk management framework.

5 Speech analytics have been enhanced to analyse calls at scale, driving operational efficiencies and increasing oversight across high-risk customer processes.

61 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Principal risks and uncertainties continued

Risk Pillar 4: Strategic

We seek new business opportunities, which are aligned to our customer, regulatory and commercial objectives.

Principal risk

P11

Model

The risk that incorrect assumptions, poor

design or outdated data within models

used for decision making could lead to

unintended outcomes, financial loss or

operational inefficiencies.

Links to strategic themes

Key considerations

Models are widely used across the Group and play an important role in helping achieve key business decisions, risk management and strategic objectives. The use of models carries inherent risk to the Group due to

their underlying assumptions, methodologies and complexities. Effective model governance, oversight and validation are key in mitigating model risk across the Group.

Mitigating actions

5 Specialist model risk expertise has been recruited in the second line of defence to strengthen validation and assurance, with a particular focus on Tier 1 models, including IFRS9, credit and pricing models.

5 Each model is assigned a tier based on its quantitative and qualitative impact to inform governance and independent validation, with Tier 1 models prioritised for validation given their significant business impact.

5 The Model Risk Committee meets monthly, with representation across all three lines of defence, to oversee model risk and ensure effective approval and governance processes are in place for all models and

covered tools.

5 Sub-working groups have been established to monitor the development, implementation, use and performance of all live models in the model inventory. Escalation routes are in place to the Model Risk Committee.

5 The Model Risk Policy has been refreshed to set out the key guiding principles for appropriate and effective model risk management across the lifecycle and strengthens alignment with PRA’s model risk

management principles in Supervisory Statement (SS) 1/23.

P12

Business performance

The risk that poor performance of key

business processes, such as financial

planning, operations or customer service,

could lead to financial losses, reduced

market share, threat to the Group’s

long-term viability and reputational

damage.

Links to strategic themes

Links to KPIs

Key considerations

In 2025, Vanquis returned to profitability and achieved growth in gross customer interest-earning balances. The business also benefited from the revised FOS fee structure (see customer risk) and greater clarity on its

exposure to motor finance redress following the FCA consultation on a Scheme of Arrangement (see regulatory risk).

Uncertainties in the macroeconomic, regulatory (including as an SDDT) and competitive environment remain key drivers of business performance risk. To mitigate these risks, we continue to focus on improving technology

and business efficiency and maintaining attractive customer propositions, which support the needs of our customers.

Mitigating actions

5 The Group monitors strategic risk by conducting regular forecasts, stress testing and scenario analysis, including those undertaken in the ICAAP and ILAAP.

5 Performance is monitored monthly against internal forecasts and key indicators. The Executive Risk Committee considers emerging risks and takes appropriate action to ensure risks are managed and strategic goals

are met.

5 The product leads monitor demand for products to ensure that the Group continues to deliver against its strategy and customer needs.

5 The pricing framework in place supports disciplined pricing decisions, balancing growth, margin, affordability and customer outcomes.

5 Ongoing assessment of market positioning and competitive dynamics informs product design, pricing and distribution decisions.

5 The Group’s Future Bank Strategy provides a clear roadmap for sustainable growth, cost efficiency and capability enhancement, with delivery overseen through established governance committees.

Strategic themes

Customer-led Insightful risk

management

Efficient

organisation

Digital, tech, data

andanalytics

A great people

proposition

KPIs

Find our KPIs on pages 18 to 20

62 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

In accordance with the 2024 UK Corporate

Governance Code, the directors confirm that

they have a reasonable expectation that the

Group will be able to continue to operate and

meet its liabilities as they fall due over the next

three years to 31 December 2028 (the Viability

Period). The Viability Period represents the

period over which the Board has a reasonable

degree of confidence over anticipated events,

including prospects for the macroeconomy,

andalso provides an appropriate outlook

overthe medium tolong term.

In making the Group viability statement, the

directors have made an assessment of the

Group’s current financial position and prospects,

as outlined within the Strategic Report, together

with the principal risks and other factors likely

toaffect the Group’s future performance

anddevelopment. This assessment is made

followingconsideration of a wide range

ofinformation, including:

5 the Group’s corporate plan, updated in 4Q25

to capture latest outer year projections,

which sets out financial, capital, liquidity

andfunding projections, together with an

overview of relevant risks;

5 the principal and emerging risks which could

impact theperformance of the Group;

5 a severe but plausible stress testing

scenario, which is designed to assess the

potential impact of certain underlying risks

on the Group’s capital and funding

resources, together with the availability

andeffectiveness of mitigating actions; and

5 reverse stress testing analysis, which is

designed toassess the point at which the

Group is no longer aviable concern.

The Group’s corporate plan was approved by

the Board in January 2026. In doing so, the

Board has reviewed detailed forecasts for the

three-year period to December 2028 and

considered less detailed forecasts for 2029 and

2030. These higher-level, outer year forecasts do

not contain any information which would cause

different conclusions to be reached over the

longer-term viability ofthe Group.

The Group’s annual planning process takes into

account the Group’s strategic objectives and

business model. The business model focuses on

relatively short-term lending to consumers and

operates conservative underwriting. The plan

makes certain assumptions about the regulatory

environment, future economic conditions and

anticipated changes within the markets in which

the Group operates and also makes an

assessment of the Group’s ability to fund new

business growth. The Board obtains independent

assurance from Group Risk over the alignment

of the corporate plan with the Group’s strategy

and the Board’s risk appetite. Specific focus is

placed on capital risk as well as liquidity and

funding risk. The assessment also considers the

key risks which may impact delivery of the

Group’s operating plan. The Group’s principal

risks are included onpages 57 to 61.

The corporate plan is based on a

macroeconomic scenario which was in line with

market consensus estimates, and which assumes

that the UK economy remains constant, with

expectations of moderate levels of GDP through

2026 with expected reductions in the Bank Rate

in 2026. Inflation is expected to fall through 2026

c.2.6% and continue to reduce thereafter

towards the 2% BoE target. The plan assumes

that the UK unemployment rate remain broadly

stable in 2026 and decreases from 2027.

The Board conducts a number of specific reviews

of the corporate plan provided by Group and

functional management, alongside other regular

briefings on and discussion of new strategies,

business developments and current financial

performance. These reviews consider a range

ofmarket opportunities and developments,

together with associated risks from within

theBoard’s riskappetiteframework.

The Group manages its liquidity to meet the

Overall Liquidity Adequacy Rule (OLAR) and to

ensure that it can meet its liabilities as they fall

due. The level of liquidity required by the OLAR

is determined by the Internal Liquidity Adequacy

Process Assessment (ILAAP) and is based on

ananalysis of the Group’s business as usual

forecast cash requirements but also considers

their predicted behaviour in stressed conditions.

In recognition of the waiver renewed in October

2025, which allows Vanquis Bank Limited to

fundthe vehicle finance business, the ILAAP

alsoincludes an assessment of the liquidity

needs of the wider Non-Bank Group. The Group

has sufficient access to liquidity resources,

including retail deposits, secured funding on

itsassets and access to wholesale markets.

Furthermore, the Group has plausible options

available to it, should the need arise, to either

reduce the liquidity requirements or increase

theamount of liquidity it has (or can raise).

The corporate plan has been stress tested using a

severe macroeconomic scenario which is broadly

consistent with the “rates-up” scenario, with the

UK unemployment rate rising to approximately

7.8%. The stress test scenario takes into account

the availability and effectiveness of mitigating

actions which could be taken by management to

avoid or reduce the impact of the macroeconomic

stress. These management actions could include

but are not restricted to restricting variable pay,

reducing lending growth, and/or changing the

dividend payout. The corporate plan has also

been reverse stress tested to the point of

non-viability after reflecting available mitigating

actions. The viability assessment concluded that

the Group’s viability only comes into question

under an unprecedented macroeconomic scenario.

The Group has an established operational

resilience and business continuity policy and

framework which define the approach to continuity

and resilience to meet regulatory expectations

involving scenario exercising and vulnerability

remediation. Third Party Risk Management is a

key consideration when evaluating the overall

resilience of the Group with contingency and exit

planning a core focus enabling us to mitigate

the impact of material third-party failure.

The directors also considered it appropriate to

prepare the financial statements on the going

concern basis, as set out on page142.

Dave Watts

Chief Financial Officer

25 February 2026

Viability statement

63 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

64 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Chairman’s introduction to governance

Robust governance

to underpin the

delivery of our

strategy

Dear Shareholder,

On behalf of the Board, I am pleased

tointroduce the 2025 Corporate

GovernanceReport.

Board activity and oversight

ofstrategy

Board activity during the year (pages 71 to 72)

was heavily focused on the Group’s ongoing

transformation and the achievement of key

objectives that resulted in a return to profitability.

The Board received two substantive updates on

the strategic plan for growth to 2027, including at

an offsite meeting with the Executive Committee

in June and during a visit to our Chatham site in

September, which also provided opportunities

for wider colleague engagement.

The Group’s strategy centres on product

expansion and diversification to meet our

customers needs, the development of

partnership opportunities, and a digital-first

approach supported by continuous efficiency

improvements. Our technology transformation

programme remains pivotal to delivery of these,

and I am pleased to report that progress

remained substantively on track during 2025.

The Board also continued to oversee

enhancements to our risk management and

internal control framework in preparation for the

Sir Peter Estlin

Chairman

Our governance framework and

Board composition are designed

toensure rigorous oversight of

strategy, risk and culture, enabling

the Group to create sustainable

long-term value.”

Sir Peter Estlin

Chairman

requirements of the refreshed UK Corporate

Governance Code. In September, we approved

the issuance of Additional Tier 1 capital and the

buyback of Tier 2 capital (page 70), strengthening

the Group’s capital position and ensuring our

continued ability to deploy capital effectively.

Culture

The Board recognises the importance of

embedding a Group culture that reflects our

purpose and values (page 73). A highlight this

year was achieving Great Place to Work

accreditation, which reflects meaningful progress

in colleague engagement. Through site visits and

colleague events, the Board gained valuable

insight into colleague sentiment and heard

directly from teams across the Group (page 74).

Board composition and governance

Following the Board reorganisation during 2024

and January 2025, composition remained stable

throughout the year. The Board continued to draw

on its broad expertise to provide constructive

challenge and support to the Executive. As part

of our three-year cycle, an external evaluation

was undertaken by Independent Audit (pages

82 and 83), which commended the Board’s

diversity, commitment and positive dynamic.

The Board remains committed to the highest

standards of governance to underpin the

delivery of our strategy. Further detail on the

work of our committees is set out on pages 84

to97, including our preparations for the new

requirements under the UK Corporate

Governance Code 2024 (page 94).

I am pleased to confirm that our 2026 AGM will

take place in our new Bradford head office on

6th May 2026 at 10am. I hope you will be able to

join us.

Sir Peter Estlin

Chairman

25 February 2026

65 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Chairman’s introduction to governance continued

Governance highlights

5 Continued development and embedding of the Group’s strategic priorities (71)

5 Continued simplification of the Group’s corporate structure to achieve further efficiencies (77)

5 Optimisation of our capital structure (70)

5 GPTW accreditation demonstrating the continued embedding of our culture (73)

The Board confirms that, for the year ended 2025, the Group has complied with the provisions

and consistently applied the principles of the UK Corporate Governance Code 2024.

Page

Code

principles

Chairman’s introduction to governance 64

Our Board 66 A

Division of responsibilities 68 F, G, H, I

Setting our strategy 70 C

Promoting long-term sustainable success: Board focus areas during 2025 71 A

The Board: our culture 73 B

Stakeholder engagement and decision making 74 D, E

Effective engagement with shareholders and stakeholders: Investor Relations 78 D

Composition, succession and evaluation 79

Board composition 79 J, K

Director induction and training 80

Assessing Board performance – annual Board evaluation 82 L

Nomination and Governance Committee Report 84 J, K

Audit, risk and internal control 86

Audit Committee Report 86 M, N

Risk Committee Report 91 O

Directors’ Remuneration Report 95

Directors’ Report 123 P, Q, R

You can read about our progress against the new Provision 29 requirements introduced by the

UK Corporate Governance Code 2024 in our Risk Committee Report (94).

During 2025, the 2024 updates to the UK Corporate Governance Code were embedded and compliedwith.

Key changes (non-exhaustive) Our response

Principle C: embedding an outcomes focus in

governance reporting in the context of the

Group’s strategy and objectives

Our Annual Report continues to link all

keydecisions and activities to the Group’s

strategic objectives.

Provision 2: reporting on how the Group’s

culture has been embedded

Our culture reporting (page 73) outlines the ways

in which the Board oversaw the embedding of the

Group’s desired culture.

Principle J: the requirement for a formal and

transparent Board appointment process and

updates to the articulation of diversity

characteristics

You can read about our approach to Board

appointments on page 84.

Our Inclusion and Diversity Policy was updated

tomirror the language used in the Code.

Principle O: makes the Board responsible for

maintaining the effectiveness of the risk

management and internal control framework

You can read about our progress on developing

our risk management and internal control

framework in our Risk Committee Report (page 93).

Provision 25: extends the requirement to adhere

to the Audit Committee Minimum Standards to

all premium listed companies

The Audit Committee updated its terms of

reference and forward agenda planner to ensure

compliance with the Minimum Standard. The most

significant area of change relates to the audit

tender process. You can read about our approach

to this on page 87. When the Company launches

the next tender process, the Minimum Standard

requirements will be adhered to.

Provision 28: requires an explanation of the

procedures in place to manage and identify

emerging risks

You can read about our approach to emerging

risks on page 93.

Provision 29: in addition to Principle O, the

Board must identify and attest to the

effectiveness of its material controls (for Financial

Years commencing after 1 January 2026)

You can read about the Group’s work on material

controls in our Risk Committee report on page 94.

66 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Board of Directors

Our Board

Sir Peter Estlin

Chairman

Appointed as Chairman: 15 September 2023

Joined the Board: 19 April 2023

Tenure: 2 years

Career and experience:

Peter is a senior finance professional with a 35-year career

in banking and finance with PwC, Citigroup and Barclays.

Peter was knighted in 2020 for his services to international

business, skills and inclusion. He also served as the 691st

Lord Mayor of the City of London from 2018 to 2019 and has

been an Alderman for the City since 2013. Having qualified

as a Chartered Accountant with Coopers & Lybrand in 1993,

where he later became a Partner, he held the role of CFO

for the Asia Pacific and, latterly, the Global Corporate and

Investment Bank businesses at, Citigroup. From 2008 Peter

held senior roles at Barclays plc, including Group Financial

Controller, CFO of the Retail and Business banking division

and acting Group CFO.

Peter’s contribution to the Board, key strengths,

skillsand reasons for re-election:

Peter is a commercially and strategically astute CFO and

non-executive director who brings both breadth and depth

of banking experience, including retail banking, and is an

experienced chairman.

5 A strong leader with significant finance and accounting

experience gained in professional services and banking,

further complemented by expertise across systems

management, financial reporting and accounting,

investor relations, treasury management, and mergers

and acquisitions.

5 Extensive governance experience, across the private,

public and charitable sectors.

5 Wealth of knowledge of the financial markets

andexperience of implementing strategy and

deliveringsignificant corporate transactions,

andtransformation projects.

Current external appointments:

5 Non-Executive Director of NM Rothschild Ltd,

Supervisory Board member at Rothschild WAM Co

andRothschild & Co and of the Institute for

Apprenticeships and Technical Education (IfATE).

5 Chair of FutureDotNow and Association of Apprentices.

5 Trustee at Ironmongers Trust Company.

5 Director at Revolut Newco UK Ltd.

Ian McLaughlin

Chief Executive Officer

Appointed: 1 August 2023

Tenure: 2 years

Career and experience:

Ian has extensive banking experience across mortgages,

wealth management, savings, insurance and motor finance.

From 2019, Ian was the CEO of Bank of Ireland (UK) Plc.

Hehas served as a non-executive director on bank and

technology company boards, and from 2012, held senior

retail banking roles at Royal Bank of Scotland (now

NatWest Group), including developing specialist consumer

and commercial financial services propositions.

Ian’s contribution to the Board, key strengths,

skillsand reasons for re-election:

Ian is a highly experienced chief executive officer and

board director. He has a strong track record of delivering

growth through improving customer service and enhancing

distribution volumes and channels, through the recruitment

and development of high-performing teams.

5 A deep knowledge of the financial services industry

andregulatory environment.

5 Experience in managing complex transformation

programmes, providing clarity on strategy, purpose

andculture, whilst overseeing successful operational

delivery.

5 Delivering market-leading customer propositions that

provide excellent customer outcomes.

5 Leading brand, product and proposition development.

5 Non-executive director experience.

Current external appointments:

5 Non-Executive Director of UK Finance Limited.

Michele Greene

Senior Independent

Non-Executive Director

Appointed: 9 March 2023

Tenure: 2 years

Career and experience:

Michele is a highly experienced finance professional at

executive and board level. She has held senior roles at

Virgin Money and MBNA Europe Bank and, prior to that,

she worked across various finance functions at Goldman

Sachs, Credit Lyonnais and KPMG Dublin. At Virgin Money,

Michele was Director of Strategic Development, where she

was responsible for establishing a credit card business on

anewly built IT platform, and was subsequently appointed

as the Managing Director of the Virgin Money Digital Bank.

In 2018 Michele co founded Mololo Limited, a boutique

advisory company specialising in helping companies in the

payments and unsecured lending space.

Michele’s contribution to the Board, key strengths,

skillsand reasons for re-election:

Michele has over 25 years’ experience of financial services

and retail banking, particularly in the areas of payments

and digital innovation. Michele has built significant

experience in the development and growth of successful

banking businesses.

5 Chartered Accountant and experienced business

executive and finance professional with a strong track

record as a CFO and MD.

5 Deep knowledge within the consumer credit, card

payments and digital banking sector.

5 Proven ability to build effective working relationships

with key stakeholders, including regulators, investors

and analysts.

5 Non-executive director and chair experience.

Current external appointments:

5 Executive Director and co-founder of Mololo Limited.

5 Non-Executive Director of Bank of Ireland Group plc,

J&E Davy Unlimited and, East End Fair Finance Limited.

5 Trustee of Bank of Ireland Staff Pension Fund.

Dave Watts

Chief Financial Officer

Appointed: 1 November 2023

Tenure: 2 years

Career and experience:

Dave is a highly experienced banking CFO who worked for

HSBC for nearly 30 years in a variety of roles at the global,

regional and business levels. He notably was part of the

team that established the UK ring fence bank of HSBC and

was subsequently the CFO and an Executive Director of

HSBC UK Bank plc from 2017-2021. Most recently, Dave served

as CFO and Executive Director of HSBC Bank plc, which

managed HSBC’s business in Europe (ex. UK). Between 2015

and 2018, he was the CFO of HSBC Bank plc. Dave’s prior

roles were outside of personal banking and wealth, including

global CFO roles for commercial banking, global banking,

operations and technology. Dave qualified as a Chartered

Accountant with KPMG and is a qualified treasurer.

Dave’s contribution to the Board, key strengths,

skillsand reasons for re-election:

With over 35 years of financial services experience,

Davehas a proven track record of executing strategy

anddelivering on significant challenging multi-year

transformations and projects.

5 A highly experienced finance leader with extensive

banking experience.

5 A strong treasury background with experience in

challenging liquidity, funding and capital matters,

inentities with differing regulatory requirements.

5 A proven track record of enhancing engagement and

relationships with various external stakeholders,

including regulators.

5 A strong cost management capability having led

numerous cost management and reporting initiatives.

5 Non-executive director experience.

Current external appointments:

5 Non-Executive Director of CAF Bank.

Committee key:

Audit Committee

Disclosure Committee

Nomination and Governance Committee

Remuneration Committee

Risk Committee Committee Chair

67 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Board of Directors continued

Our Board continued

Karen Briggs

Independent

Non-Executive Director

Appointed: 27 March 2024

Tenure: 1 year

Career and experience:

Karen is a qualified accountant with over 30 years’

experience, having held many senior leadership roles at

KPMG UK, including as Head of Risk Consulting and Head

of Tax, Pensions and Legal Services. Throughout her career

she has had a focus on financial services, AI, big data and

technology. She was a Board member for K Capital, KPMG’s

global technology investment fund, where she led the

development and management of AI, cyber, data and other

solutions. In 2020 she led the Forensic & Litigation Consulting

and Technology practices of FTI in EMEA and focused on

strategic leadership to drive transformational growth.

Karen’s contribution to the Board, key strengths,

skillsand reasons for re-election:

In addition to her financial services expertise, Karen has

also been a senior banking regulator and worked on the

highest profile banking investigations globally. Karen is a

highly experienced leader focused on leading complex

global regulatory, forensic and financial crime assignments

for financial institutions, other regulated entities

andregulators.

5 Extensive experience of working with audit committees,

and familiarity with accounting and assurance.

5 Brings extensive experience of designing, implementing

and overseeing large-scale remediation programmes

across a variety of sectors covering risk, assurance,

compliance, conduct, regulation, and data/technology.

5 Non-executive director experience.

Current external appointments:

5 Chair of Audit & Risk Committee and Independent

Council Member of Imperial College London.

5 Non-Executive Director and Trustee of Invictus Games

Foundation Board and IGF Trading Ltd.

5 Advisory Council Member for Elevate City, a women’s

leadership network.

5 Chair of Audit Committee and Non-Executive Director

ofSMBC Bank International plc.

5 Chair of Audit & Risk Committee and Non-Executive

Director of Chubb Underwriting Agencies Limited and

Happold LLP.

5 Non-Executive Director of Chubb European Group SE.

Graham Lindsay

Independent

Non-Executive Director

Appointed: 1 April 2019

Tenure: 6 years

Career and experience:

Graham held a number of senior executive roles at Lloyds

Banking Group over a 40-year period, including responsibility

for the Lloyds branch network, HR Director of the Retail

Bank and as Group Responsible Business Director. Graham

joined the Wonga UK board in 2016 as part of the new

leadership team engaged to improve the business and

deliver change following regulatory approval.

Graham has been a Board member of the Institute of

Banking & Financial Services and sat on the Professional

Standards Board. He is Senior Independent Director at

OneFamily, a Trustee of Break Charity and an Emeritus

Trustee of The Brain Tumour Charity.

Graham’s contribution to the Board, key strengths,

skills and reasons for re-election:

Graham brings to the Board extensive experience in

commercial, private and retail banking and a deep

understanding across all distribution channels. Graham has

had demonstrable success in focusing organisations on

their customers, ensuring they are at the heart of decision

making and product design. Graham also has a strong

appreciation of the Group’s regulatory environment.

5 Extensive customer knowledge, strong customer

focusand a track record of enabling and overseeing

businesses to ensure that they put the customer at the

heart of what they do.

5 Significant stakeholder engagement experience.

Current external appointments:

5 Senior Independent Director at OneFamily and

Chairofthe Pension Trustee Board.

5 Trustee of Break Charity.

5 Emeritus Trustee of The Brain Tumour Charity.

5 Director at Family Assurance Staff Pension Scheme

Trustees Ltd.

5 Vice Chair of Skipton Group.

Jackie Noakes

Independent

Non-Executive Director

Appointed: 27 March 2024

Tenure: 1 year

Career and experience:

Jackie is a senior leader with extensive experience in

large-scale business and technology transformation

acrossbanking and insurance. She has significant executive

experience at board level having performed roles as CEO,

COO and CIO. Jackie has non-executive experience in mutual

and listed plc businesses. In September 2018 she joined the

Bank of Ireland as Group Chief Operating Officer and

played a key role in delivering bank-wide transformation.

This included enhancements to the group’s information

security management and cyber risk protection measures.

Jackie held several roles at Legal & General including

leading the company’s £105bn savings business.

Jackie’s contribution to the Board, key strengths,

skillsand reasons for re-election:

Jackie works at executive level to lead, shape and deliver

strategic business change, undertaking the management

ofacquisitions and divestments as well as designing

andimplementing enterprise-wide transformation and

regulatory compliance.

5 A strong customer focus, leveraging data and insights

to drive continuously improved experiences and

customer journeys.

5 Has specific skills and experience across payments,

technology, operations, information security, and

strategic data transformation.

5 Extensive experience in financial services and a strong

track record in delivering on business transformation.

5 Non-executive director experience.

Current external appointments:

5 Director at SLFC Services Company (UK) Limited.

5 Director at The Scottish Mutual Assurance Society.

5 Director at Pearl Group Services Limited.

5 Director at PGMS (Glasgow) Limited and PGS 2 Limited.

5 Director at Reassure UK Services Limited.

5 Group Chief Operating Officer of the Phoenix Group.

Oliver Laird

Independent

Non-Executive Director

Appointed: 27 March 2024

Tenure: 1 year

Career and experience:

Oliver is a highly experienced board level chief finance

officer and non-executive director with extensive finance

and regulatory experience in financial services,

manufacturing and consultancy having been CFO at

Lookers plc (£4bn revenue car retailer, 6,500 employees),

CFO at First Direct, Director of Central Finance at Lloyds

Banking Group and Finance Director of Co-op Insurance.

Hehas held non-executive director and audit committee

chair roles across a range of sectors.

Oliver’s contribution to the Board, key strengths,

skillsand reasons for re-election:

Oliver is financially literate and will be able to confirm

theintegrity of internal controls and financial reporting

anddetermine how risk will be evaluated, calibrated,

andmanaged. He displays an engaging leadership style

with effective communication skills and is objective and

independently minded, prepared both to challenge and

support management yet still be a team player.

5 A highly experienced finance leader with extensive

banking experience.

5 A strong CFO background with experience in financial

analysis and planning, statutory regulatory reporting,

investment and capital structure decisions, and group

tax and treasury management.

5 A commercially focused executive with a proven track

record of building business and delivering strategic

change and improvements that drive uplifts in profits,

increase shareholder value and improve the control

environment.

5 Non-executive director experience.

Current external appointments:

5 Chair of Audit Committee and Board member

ofBeverley Building Society.

5 Non-Executive Director and Audit Committee Chair

ofthe Shepherds Friendly Society.

5 Non-Executive Director and Audit Committee Chair

ofthe UK Board of Paysafe Limited.

68 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Division of responsibilities

The Group’s governance framework

supports the appropriate allocation

of accountability and compliance

with best practice. It facilitates the

Board’s role in setting the strategy,

challenging management on the

execution of strategy and overseeing

effective risk management and

internal controls.

The structure detailed opposite is underpinned

by committee terms of reference, matters

reserved for the Board (www.vanquis.com/

investors/board-corporate-governance) and the

Group’s Delegated Authorities Manual. Whilst

maintaining best practice, the governance

framework allows for agile decision making

andresponsiveness.

Executive directors

The Group’s executive directors – the CEO and CFO – are responsible for all matters pertaining to the Group’s performance

andday-to-day management. The executive directors are assisted by the Executive Committee, which supports the operation

ofthebusiness and informed decision making onmatters not reserved for the Board or Board committees.

The Executive Committee is supported by two senior executive management committees, the Executive Risk Committee and

theGroup and Bank ALCO.

The Board

The Board is primarily responsible for setting the Group’s strategy for delivering long-term value to our shareholders and other

stakeholders, providing effective challenge to management concerning the execution of the strategy and ensuring the Group

maintains an effective risk management and internal control system.

Our strategy

see page 70

Managing risks

see page 91

Board composition

see page 79

Section 172(1)

Statement

see page 52

Board activities

see pages 71 and 72

The Board delegates certain matters to its committees

See page 86 for the

Committee’s role

and responsibilities

See page 91 forthe

Committee’s role

and responsibilities

See page 95 forthe

Committee’s role

and responsibilities

See page 84 forthe

Committee’s role

and responsibilities

Audit

Committee

Risk

Committee

Remuneration

Committee

Nomination and

Governance

Committee

Disclosure

Committee

Shareholders and other stakeholders

Governance framework

69 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Shareholder informationFinancial statementsStrategic report

Independence of the Board

Division of responsibilities continued

Independence of the NEDs

and conflicts ofinterest

The Board and Nomination and Governance

Committee review the independence and time

commitment of NEDs onappointment and

thereafter annually, taking into account the

requirements of the Code. Time commitment

isalso reviewed where an additional external

appointment for a director is proposed. During

2025, the Board approved the appointments of:

5 Oliver Laird as NED and Audit Committee

Chair of Paysafe Limited;

5 Karen Briggs as Director of Invictus Games

Foundation Trading Limited (IGF Trading);

and

5 Graham Lindsay as Vice Chair of

SkiptonGroup.

Clearly defined roles and responsibilities

We define the separate roles and responsibilities of our Chairman, CEO and Senior Independent

Non-Executive Director in writing and they are available on our website, www.vanquis.com.

Chairman, Sir Peter Estlin

5 Builds and leads an effective and

appropriately skilled Board, which

challenges management onthe

execution of strategy.

5 Promotes best practice Board

behaviours through effective chairing

and the encouragement of constructive

challenge and openness.

5 Ensures that the Board promotes high

standards of corporate governance

and models Company culture.

5 Engages with stakeholders to inform

decision making.

Chief Executive Officer, Ian McLaughlin

5 Manages the day-to-day operations

ofthe Group to execute the Board

agreed strategy and deliver the

Group’s purpose.

5 Leads executive management in the

implementation of Board decisions

andpromoting Company culture.

5 Manages the Group’s risk profile in

accordance withBoard direction.

5 Demonstrates ethical leadership

andmodels accountability

andtransparency.

Senior Independent Non-Executive

Director, MicheleGreene

5 Acts as a sounding board for the

Chairman and anintermediary for

other NEDs, as required.

5 Leads the performance review

oftheChairman.

5 Is available to shareholders outside

ofthe normal communication channels.

General Counsel and Company

Secretary, MichaelMustard

5 Advises on legal, governance, and

Board procedural matters.

5 Ensures the Board has high-quality

information, andthe resources required

to function effectively.

5 Facilitates discussion between the

Board and executive management.

5 Leads on delivery of corporate

governance requirements and the

Board effectiveness evaluation.

Non-executive directors

5 Provide independent and

constructivechallenge.

5 Scrutinise the performance

ofmanagement.

5 Develop strategy using their experience

and expertise from other sectors.

5 Chair the Remuneration,

Nominationand Governance, Risk

andAudit Committees.

Chief Financial Officer, Dave Watts

5 Leads the Group Finance function

inthedelivery ofGroup strategy.

5 Is responsible for capital management,

financialreporting and effective.

financial processes and controls.

5 Liaises with investors alongside

theCEO.

Executive Leadership Team

5 Supports the CEO in the development

and implementation of strategy, and

the embedding of culture.

5 The Executive Committee is comprised

of the ChiefExecutive Officer, Chief

Financial Officer, Chief Risk Officer, Chief

People Officer, Director of Customer

and Products, Chief Operating Officer,

Internal Audit Director, ChiefDigital and

Analytics Officer, and Group General

Counsel and Company Secretary.

Designated Non-Executive Colleague

Champion, Graham Lindsay

5 Seeks to understand the views

ofcolleagues.

5 Attends Colleague Forums and other

colleague engagement events.

5 Articulates the views of colleagues

atBoard meetings.

All Directors are required to disclose to the

Board any interests that may pose a conflict

inrelation to their duty to promote the best

interests of the Group.

The Board concluded that all directors continue

to be independent and have sufficient time to

discharge their duties to the Company. As a

result, all are recommended for re-election at

the 2026 AGM.

Independent 71%

Executive 29%

71%

of our Board

(excluding the Chairman)

are independent

non-executive

directors

70 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Setting our strategy

Principal Decision: Issuance of Inaugural Additional

Tier 1 (AT1) Notes and Tender of Tier 2 Notes

On 1st October, the Group announced that it had successfully issued

£60m in Additional Tier 1 Notes at a coupon of 10.875% and tendered

£58.5m of its Fixed Rate Reset Subordinated Tier Notes (the “transaction”).

This aligned with the Group’s strategic aim to optimise its capital

structure to enhance its lending ability for the benefit of customers

and to maximise capital efficiency for long-term value creation.

Decision-making process

The Board considered the proposal in July 2025,

receiving a detailed overview of the proposed

transaction from the CFO, supported by documentation

produced by the Group Treasury team. The Board

noted the key benefits of the proposal: enhanced and

efficient capital structure, facilitation of receivables

growth, and improved clarity of capital position for

investors. The Board was asked to approve the

transaction within clear parameters and delegate

authority for execution to the CEO andCFO.

Considerations and challenges

In response to Board challenge, the Executive

confirmed that the transaction would not be executed

until the outcome of the Vehicle Finance Commissions

Supreme Court judgment, which represented a

significant external variable for the Group; any change

resulting from the judgment would have necessitated a

return to the Board for amended authority to execute.

The Board also sought and received confirmation that

the regulator agreed with the proposal and additional

clarity on the terms of the instrument. The Board noted

the second line of defence risk assessment, which

supported theproposal.

Stakeholder impact analysis

The Board noted the impact of the transaction

onallstakeholder groups, noting in particular the

regulator’s support for a strengthened capital

structure, the direct benefit to existing investors

seeking to exit the Tier 2 instrument, the long-term

benefit to investors from capital optimisation and

resulting receivables growth, and the benefit to

customers from enhanced lending capability and

operational efficiency. The Board concluded that

thetransaction was in the best interests of the

Group’sstakeholders.

Links to stakeholders

Links to strategic themes

Links to risks

Links to s.172

Key

Links to stakeholders

Customers

Colleagues

Government and Regulators

Shareholders

Communities

Suppliers

Links to strategic themes

Customer-led

Insightful risk management

Efficient organisation

Digital, tech, data andanalytics

A great people proposition

Links to risks

Find our key risks on pages 57 to 61

Links to s.172

The likely consequences of any decision in the long term

The interests of the Company’s employees

The need to foster the Company’s business relationships

with suppliers, customers and others

The impact of the Company’s operations on the

community andthe environment

The desirability of the Company maintaining a reputation

for high standards of business conduct

The need to act fairly as between members

oftheCompany

The Board’s oversight of strategy and

the alignment of major decisions with

strategic direction is underpinned by

the Group’s strategic themes and the

generation of long-term value

forallstakeholders.

During the year, the Board oversaw the

execution of strategy through the monitoring

ofKPIs and updates from the Executive. In June,

the Board and Executive met for a strategy

focused day of meetings, the output of which

was refined further throughout the second half

of the year, culminating in an agreed strategy

for growth to 2027. Vanquis remains committed

to serving the underserved though a diverse

product offering based primarily on Cards and

Vehicle Finance, complemented by partnerships

to serve other lending needs. A strong capital

position is imperative for sustainable growth; this

was enhanced by the issuance of £60m in

Additional Tier 1 Notes and a tender of Tier2

Notes in October. You can read about the

Board’s role in this strategic decision below.

Customer-led

Insightful risk

management

Efficient

organisation

A great people

proposition

Digital, tech, data

and analytics

71 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Promoting long-term sustainable success:

Board focus areas during 2025

Board meeting agendas are informed by annual requirements, the Group’s Delegated Authorities Matrix, and responsiveness to both business need and

macroeconomic and external factors. The Chairman and the General Counsel and Company Secretary seek to ensure the focus of the meetings is appropriately

balanced between performance review, assurance, strategic direction and cultural issues.

Strategy Links to s.172 Links to stakeholders

Received and challenged regular updates on strategy throughout the year, with substantive strategy sessions being held in June and September.

Reviewed peer and competitor analysis in November.

Approved the issuance of AT1 capital and repurchase of Tier 2 (page 70) to optimise the Group’s capital position to facilitate the execution

of strategy in July.

Approved the continued rationalisation of the Group’s legal entity structure page 77.

Approved the Group’s long and near-term property strategy in November.

Approved several key contracts aligned with the execution of strategy.

Continued its scrutiny of the Group’s ‘turnaround priorities’, receiving updates at each meeting. a

Budget, financing and performance Links to s.172 Links to stakeholders

Scrutinised and challenged the 2026 Budget.

Reviewed and approved the half and full-year results, and quarterly market updates.

Reviewed and approved the CUG Waiver renewal application in April.

Received performance updates from the CEO and CFO at each meeting and scrutinised product performance and the continued cost

efficiencyprogramme.

IT, cyber and resilience Links to s.172 Links to stakeholders

Received a substantive update from the Group’s Chief Information Security Officer, challenging and requesting more information as required.

Oversaw the continued development of the Gateway IT infrastructure, challenging on reporting format and granularity throughout the year

and noting key risks as implementation drew nearer.

Reviewed and approved the Group’s ICAAP and ILAAP in May and June.

Received a demonstration of the new mobile app and update on the roll-out.

Received training on the market-wide impact of Artificial Intelligence and an update on Group use cases in November.

Approved the 2025 Operational Resilience Self-Assessment in March.

72 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Governance and risk Links to s.172 Links to stakeholders

Received regular updates from the CRO and the Risk Committee Chair.

Approved revised financial and treasury risk appetite measures, on the recommendation of the Risk Committee in December. a

Received and challenged regular updates from the ‘External Threats’ workstream, primarily relating to complaints and the FCA’s Vehicle

Finance Commission Scheme consultation.

Received an Investor Relations update, including analysis of the share register, investor perception and market comparison in November.

Approved the SMCR allocation and responsibilities in November.

Approved the Group Financial Lines and cyber insurance renewal in March.

People and culture Links to s.172 Links to stakeholders

Reviewed the results, themes emerging and action plan arising from the annual Great Place to Work

survey in November.

Received and challenged updates on culture and inclusion and diversity in November and December.

Received annual updates on whistleblowing and health and safety.

Received regular updates from the Designated Non-Executive Colleague Champion on key issues relating to people and culture.

Participated in colleague engagement events throughout the year, structured around Board meetings across our office locations.

Customer and regulatory Links to s.172 Links to stakeholders

Received and challenged updates on the embedding of the FCA’s Consumer Duty.

Listened to customer calls to gain further customer insight and suggest improvements to the customer experience.

The impact of the Supreme Court judgment on Vehicle Finance commissions, and subsequent FCA Scheme consultation, was regularly

debated throughout the year.

During 2025, the Board discussed ensuring more granularity of insight into the Group’s customer base and the merits of different metrics to

track complaints and customer satisfaction.

Areas of focus in 2026 include:

5 the delivery of the Gateway transformation programme;

5 continued profitability and maximisation of efficiency;

5 the long-term future strategy; and

5 the further embedding of the aspired culture.

Promoting long-term sustainable success:

Board focus areas during 2025 continued

73 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Our values

The Board: our culture

We care about people

We get the right things done

We find a better way

Our culture is derived from our purpose to deliver caring banking and ambition to unlock financial opportunities for underserved customers. The Board

assesses, monitors and embeds the Group’s desired culture. The achievement of the GPTW accreditation during 2025 demonstrated that cultural transformation

has aligned with the Group’s strategic progress from a colleague perspective. The Board takes action if it has any cultural concerns; no action was taken during

2025. Our culture extends to all of our stakeholders; you can read more about how we engage with our stakeholders on pages 74 to 78.

Monitoring culture and values:

5 The Board monitored culture, through

updates received in January, July and

November, overseeing progress during

theyear. Key feedback mechanisms

wereColleague Surveys, gender pay

gapdisclosures, and the escalation

ofwhistleblowing cases asrequired.

5 The Board supported the executive’s

development of a new Group colleague

culture statement: ACT: Ambitious,

Caringand Together.

5 The Group’s Colleague Forum,acts as

aworkforce panel. Graham Lindsay,

Chairofthe Remuneration Committee

andDesignated Non-Executive Colleague

Champion, regularly attended sessions

during 2025 enabling dialogue with

colleagues, which was reported back to

theBoard. Sir Peter Estlin and KarenBriggs

also attended during the year.

5 Board site visits provide an opportunity for

colleagues to ask questions or raise issues

with the Board. In 2025, these included

whole Board visits to the Bradford and

Chatham sites, which included informal

colleague drinks, a Board ‘speed dating’

session, the Chairman’s visit to the new

Bradford head office, and NED visits to

ourPetersfield site.

5 Remuneration is subject to risk-based

assessment and adjustment where

necessary. The Remuneration Committee

scrutinises management proposals, from

acultural lens, and challenges matters

thatmay indicate a cultural issue.

Embedding culture and values:

5 During the year we embedded a culture

ofbelonging through diversity-focused

programmes. Our I&D agenda, supported

by our Inclusion Community and Affinity

Groups, strives to foster an environment

where everyone, irrespective of their

backgrounds, abilities, or identities, feels

valued, respected, and empowered to

participate fully. The Board received an

I&Dupdate in December 2025.

5 ‘Culture Makers’ from the senior leadership

team conducted eight culture workshops

across all four sites, the results of which

informed the ‘ACT’ culture statement.

5 Our regular ‘Stay Connected’ all-colleague

virtual events and intranet articles seek

toembed the Group culture and clearly

indicate the ‘tone from the top’.

5 Linked to the work to identify and

assesstheGroup’s material controls, a full

review and refresh of the Group’s policy

governance framework was completed

during the year. The policy hierarchy and

directory were enhanced to ensure the

Group had established and communicated

aclear, consistent approach towards, policy

implementation and management. The work

has helped promote a positive risk culture of

clarity and accountability across the Group.

Culture metrics

Metric 2025 2024

Employee engagement 87% 81%

Diversity representation:

Male

Female

51%

49%

54%

46%

Colleague turnover (% of

colleagues who left

voluntarily) 7.5% 47%

Absenteeism (average

number of absence days

percolleague) 5 6

Colleague volunteering

hours 3,061 2,546

Trust Index 73% 60%

Payment practices (% of

invoices paid within 30 days) 98% 97%

Employee wellbeing

At Vanquis, we care about the health and

wellbeing of our colleagues, inside and outside

of work. We aim to support our colleagues by

being flexible and empathetic and offering a

range of health and wellbeing resources.

All colleagues have access to the following

wellbeing services, resources, and support

through our external partnerships and internal

support networks:

5 an Employee Assistance Programme (EAP)

provided by Legal and General;

5 support services available through the Bank

Workers Charity;

5 Mental Health First Aiders working right

across the Group, trained and ready to

listen and support;

5 the Denplan scheme, offering dental

insurance; and

5 Bupa Well+, which offers expert, confidential

medical advice when needed – 24 hours

aday, 7 days a week.

We pull together as a team

74 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Stakeholder engagement and decision making

Effective stakeholder communication

The Board recognises the importance of effective stakeholder engagement to the long-term success

ofthe Group. Our key stakeholder groups remained consistent during 2025, and the Board focused on

understanding its key stakeholders in a more granular and data-driven way. Their areas of interest, our

mechanisms in place to engage with them and outcomes of the engagement are set out on pages 21 to

23 in the Strategic Report. Below are some specific examples of the Board’s engagement and

consideration of each stakeholder group, demonstrating how the Board integrated stakeholder

concerns into the decisions it made.

Customers

Customer feedback, gathered through the

engagement approaches set out on page 22, is

reported to the Board through reports regarding

products, product performance, customer service and

customer experience, including customer call listening.

The Board champions continual improvement across

Group operations and seeks ways to improve

customer outcomes. All Board decisions include a

consideration of stakeholder impact (pages 70, 75 and

77– principal decisions). In both June and September,

theBoard’s strategy discussions centred on gaining a

deeper understanding of the Group’s customer base

and how to best serve our customers through product

design. Vanquis measures customer satisfaction (CSI)

in partnership with the Institute ofCustomer Service.

The survey, the results of which are reported to the

Board, enables the Group to benchmark its customer

satisfaction performance against a UK banks and

building societies average. In 2025 Vanquis undertook

three surveys, and achieved a weighted average CSI

score of 83.7, which is above the last industry

benchmark of 81.1 (published in July 2025).

During 2025, the Board oversaw, via reports from

theChief Operations Officer, the introduction of new

technology to enhance quality assurance checking in

the form of a speech analytics scorecard. The platform

significantly enhanced the Group’s monitoring

capability, improving the ability to identify customer

interactions with potential indicators of financial

difficulty, aligned with both regulatory expectation

and the customer-led strategy. All customer

interactions within high-risk segments have been

monitored since April 2025, and the Board has

scrutinised the output of this via complaints reporting.

The Operations function continues to build on progress

and introduce refinements and enhanced colleague

training through the introduction of an Outcomes

Optimisation programme.

Jackie Noakes leads the Board’s engagement on

Consumer Duty and recognised the improvements

delivered in customer understanding and expanded

customer characteristics for referral to the Operational

Specialist Support Team. The Board approved the

Group’s Consumer Duty annual attestation.

Links to strategic themes

Links to s.172

Colleagues

The Board regularly seeks direct feedback from

colleagues in various ways. This includes attendance

at the Colleague Forum and informal networking

events. In addition to regular attendance by the Non-

Executive Director Colleague Champion, the Chairman,

and Karen Briggs, Non-Executive Director, attended

Colleague Forum sessions to strengthen Board

engagement. The Chairman attended a colleague

stand-up. A colleague networking event took place at

our Chatham site where colleagues spoke to all

members of our Board. The executive directors

participate in the ‘Open Door’ initiative, allowing

colleagues to book a one-to-one meeting with any

ExCo member to discuss their own agenda. The Board

formally receives colleague feedback through the

Great Place To Work

survey, in which colleague

verbatim comments are shared and themes analysed.

The Board supported the introduction of the Group’s

colleague culture statement ‘Ambitious, Caring and

Together’ (ACT) as part of the cultural transformation

work, which received strong support from the

Colleague Forum. The Chief People Officer reported to

the Board on workforce engagement, detailing the

work of the Colleague Forum in its capacity as

advisory panel to the Board.

The Board, through its Remuneration Committee,

approved a grant under the Group’s Save As You Earn

(SAYE) Savings Related Share Option Scheme. An SAYE

grant, not possible in 2024, was welcomed by the

Board as an opportunity for colleagues to share in the

long-term success of the Company. Almost one-third of

colleagues joined the scheme.

Designated Non-Executive Director

Colleague Champion

The Board has appointed a Designated Non-Executive

Colleague Champion. Graham Lindsay continued in

this role and regularly attended Colleague Forum

meetings during the year. The Directors’ Remuneration

Report and executive and colleague remuneration

were tabled for discussion at the Forum. The Board

benefits from Graham’s engagement with colleagues,

providing unique insight into colleague perspective.

Investing and rewarding our workforce

‘Your Vanquis’, our colleague benefit framework, was

launched in 2025, bringing together the colleague

benefits under four pillars: Your Voice, Your Wellbeing,

Your Career, Your Reward. Your Vanquis builds upon the

Group’s values. The majority of colleagues were

migrated to a new HR and payroll management system

during the year, improving and standardising the

colleague experience. Performance management has

also been migrated to the HR system to help colleagues

track their objectives and performance management

discussions. To support colleague wellbeing, flexibility

and choice, the ability to buy and sell holiday was

introduced alongside ‘workations’, carer’s leave,

birthday leave and flexible bank holidays. The Board

was pleased to note the achievement of the ‘Great

Place to Work

accreditation, indicating a significant

development in the Group’s workforce engagement.

Links to strategic themes

Links to s.172

75 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Stakeholder engagement and decision making continued

Government and

regulators

We are committed to communicating proactively,

openly and honestly with our regulators. Our strategy,

purpose and values support delivery of a positive

andeffective risk culture that is focused on good

conduct and outcomes. Please see pages 54 and 55

for moreinformation.

The Board communicated directly with its regulators

across areas of common interest. During the reporting

period, the FRC reviewed the Group’s FY24 Annual

Report and Accounts as part of its regular review and

assessment of the quality of reporting in the UK. All

correspondence was approved by the Audit Committee

(see page 87). Selected Board members participated in

the Capital Supervisory Review and Evaluation Review

Process, meeting with the PRA to discuss the Group’s

capital arrangements, governance and regulatory

documents. You can read more about the outcome of

this engagement and the Group’s capital on page 6.

The Group received its Periodic Summary Meeting

letter and the Board considered the response, ensuring

that it addressed the PRA’s designated areas of

supervisory focus. Ian McLaughlin met with the FCA to

discuss a range of topics including claims management

companies, the market and the Group’s issuance of

Additional Tier 1 Notes and tender of Tier 2 Notes.

More information in our principal decision on page 70.

The Board oversaw the active contribution by the

Group to regulatory consultations including the

Consumer Credit Act reform, complaints reporting and

the FOS’s consultation regarding compensation

interest rates. The Board considered in detail the

Group’s response to the FCA’s consultation on its

proposed Vehicle Finance redress scheme, providing

detailed feedback on the FCA’s proposals. The Group’s

Chief Executive Officer remained a member of the

Board of UK Finance and contributes regularly to

industry discussions.

Links to strategic themes

Links to s.172

Principal Decision: Closure of Cheque Exchange

The Board approved the closure of Cheque Exchange Limited,

effective 31 March 2026.

Strategy and business model

Cheque Exchange Limited (CEL) is a subsidiary of the

Group, its primary purpose being the provision of

cheque cashing services to customers since 1994.

Classified as a business-to-business service provider,

CEL offered cheque cashing through high street agents

and scrap metal dealers. Demand for the service, the

agent network, and consequently the revenue have

reduced over time and this, coupled with the Group’s

reset of strategic direction in March 2024 to focus on

its core products, resulted in a review of the business.

Effective Board challenge

The Board explored different options for CEL including

its continued operation, sale or closure. The Board

assessed the stakeholder impact and outcomes of

each option, recognising that the best interests of all

stakeholders would not necessarily be aligned and

that it was therefore important to achieve a balanced

view. The Board agreed that a sale was not feasible

due to the legacy corporate structure and intra-group

legal arrangements.The Board noted that continuing

to operate CEL benefited CEL’s customers, but that

there was little prospect of future growth in the

market, which would enable CEL to contribute to the

overall long-term success of the Group, and declining

demand reduced CEL’s ability to serve existing

customers effectively or competitively. The Board

acknowledged that cheque cashing did not form part

of the chosen target business model and was not a

primary area of customer need and agreed that

resources would be better directed in pursuing the

Group’s priority areas of focus.

Agents, colleagues and customers

The Board discussed the proposed arrangements for

the closure from a stakeholder perspective. The Board

agreed that any agent and supplier contract

termination periods would be extended, allowing third

parties to make alternative arrangements. The Board

noted that for end user customers an alternative

cheque cashing service was available on the high

street and that alternative payment methods were

available for the agents to continue to offer the

service. CEL colleagues were considered similarly,

withthe lengthy closure period facilitating optionality

forcolleagues to explore internal and external

opportunities, with skills development opportunities

offered to those affected.

The Board approved the closure of CEL, acknowledging

that it would benefit the long-term success of the

Group in support of executing the Group’s strategy

and the negative stakeholder impact could be

minimised. The Board oversaw orderly arrangements

for the closure of CEL noting that a working group with

key personnel from Legal, Tax, and Risk had been

enlisted to execute the project. The Board noted that

regulatory engagement had been built into the plan

and the extended run-off period served to mitigate

reputational risks arising from the closure.

Links to stakeholders

Links to strategic themes

Links to risks

P10

Links to s.172

Effective stakeholder communication continued

76 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Stakeholder engagement and decision making continued

Communities

We recognise the importance of supporting our

communities through colleague volunteering,

community investment and long-term charitable

andcommunity organisation partnerships.

The Board oversees the Group’s sustainability

programme and supported the Group’s continued

focus on financial education, social mobility and

inclusion and addressing the root causes of social or

financial exclusion through the Vanquis Foundation.

Colleagues receive two days per year paid volunteering

time and any colleague fundraising is matched pound

for pound up to £500 per year. A total of 3,061

volunteering hours were recorded by colleagues in

2025 and £0.9m has been invested in our community

support programmes.

The Chairman was present when the Group signed the

Armed Forces Covenant alongside the Lady Mayoress

of London. The commitment pledges support for

service members and veterans regarding fair

treatment, career support, internal resource and

community engagement initiatives.

The Group partners with programmes and projects

that focus on financial literacy and inclusion.

Duringthe reporting period the Group has

sponsoredBullseye Maths, an initiative that enhances

numeracy skills through darts. The Group has continued

to work with theAhead Partnership, School-Home

Support, PlainNumbers and National Numeracy to

promote financialinclusion and build career aspirations.

You can read more about our community engagement

on page 23. In November, CEO Ian McLaughlin

contributed to the Step into Tech workshop held in

November which seeks to inspire young women to

explore careers in technology and digital. CFO Dave

Watts used his volunteering time to undertake his role

as Independent Non-Executive Director of the Charities

Aid Foundation Bank.

During 2025, Bradford was the UK City of Culture. As a

major supporter, the Group contributed to the Sing,

Dance, Leap! project for Bradford schoolchildren.

Links to strategic themes

Links to s.172

Suppliers

We have an established procurement and supplier

governance framework that supports us to form

positive relationships with our suppliers. We are a

reliable partner and appreciate that our suppliers

enable us to deliver good quality services and

products to our customers and other stakeholders.

The Board recognises that risk management,

sustainable business and contract performance are

key areas of interest to suppliers and consequently

oversaw enhancements to the operational resilience

and business continuity and third-party risk

management (TPRM) frameworks during the year. The

TPRM framework was refreshed and the TPRM policy

approved by the Risk Committee in November. The

Board approved the Group’s annual Operational

Resilience Self-Assessment and the Board Risk

Committee received a progress update in September,

noting that the delivery plan for meeting the

regulatory requirement was on track. A supplier

conference was held in November to strengthen

material third-party relationships. Activities were also

completed to educate and raise colleague awareness

of the framework expectations and responsibilities.

The Board welcomed the achievement of gold

standard by the Group under the Fair Payment Code,

which is the highest achievement awarded and is

recognised accreditation for the prompt payment and

fair treatment of our third-party suppliers. The Group’s

payment terms are aligned to the Fair Payment Code

(30 days).

The Board Risk Committee considered suppliers in it’s

oversight of cyber risk and operational risk. The Risk

Committee commissioned a review of the National

Security Strategy 2025: Security for the British People in

a Dangerous World, published by the UK Government in

June 2025, which confirmed the Group was positioned

to withstand the threats identified. You can read more

about this in the Risk Committee Report on pages 92

and 93.

The Board considered material contracts and received

performance updates regarding the Group’s material

suppliers, including those providing services linked to

the Gateway IT programme.

Links to strategic themes

Links to s.172

Effective stakeholder communication continued

77 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Stakeholder engagement and decision making continued

Principal Decision: One Vanquis legal entity project

Background: The Board noted that the current legal entity structure

was not reflective of the current operating model and was inefficient,

resulting in additional cost and administrative burden.

Decision-making process

In late November 2024, the Board received a detailed

proposal from the CFO to rationalise and simplify the

legal entity structure of the Group to better reflect the

current operating model, reduce costs, reduce the

complexities of intra-group funding arrangements and

mirror other Group simplification projects already in

progress. Phase 1 of the project completed on

31December 2024. In July 2025, the Board approved

Phase 2 of the project, to align Group servicing

activities, including the transfer of related assets,

liabilities, supplier contracts and colleagues. In

November 2025, Phase 3, which involved the

elimination of the Group’s dormant legal entities, was

approved. After careful consideration at each stage,

the Board concluded the proposal was in line with the

Group’s strategic objectives and conveyed clear

long-term benefit to the Group as a whole.

Considerations and challenges

Considerable due diligence was undertaken by a

working group, under delegated authority from the

Board, tasked with identifying all issues, risks and

mitigations resulting in the intra-group novation of 221

supply contracts and 388 employee contracts to

facilitate the rationalisation process. The colleague

impact and messaging of the required Transfer of

Undertakings (Protection of Employment) regulation

(TUPE) arrangements was a key Board consideration.

Adetailed step-plan was formulated and scrutinised

by the Board to ensure the transfer of assets and

liabilities within the Group was completed accurately,

avoiding any unintended exposure to risk from a

regulatory, tax and legal perspective.

Stakeholder impact analysis

It was recognised colleagues would be impacted

bythe TUPE consultation process to move their

employment contracts to the Bank and similarly

suppliers, some critical to the business, would be

consulted as part of the novation process. The Board

concluded that the cost savings and efficiency benefits

resulting from the project would be in the best interest

of all Group stakeholders.

Links to stakeholders

Links to strategic themes

Links to risks

P12

Links to s.172

Everything we do is focused

on delivering better outcomes

for customers and learning

from insight to improve

ourservices.”

Ian McLaughlin

Environment

The Group remains committed to minimising its

environmental impacts. Our climate-related financial

disclosure is consistent with the four pillars and 11

recommended disclosures of the Task Force on

Climate-related Financial Disclosures (TCFD), the

requirements ofthe Climate-related Financial

Disclosure (CFD) Regulations 2022 and the UK

Companies Act (that is, sections 414CB(2A) (a to h)).

See pages 33 to 43 of our Sustainability Report for

more information.

The Board oversees the Group’s ESG strategy and

received a performance report during the reporting

period. The Board noted the Group’s focus on UK

regulatory compliance and that the Group had moved

away from carbon offsetting in favour of improving

energy efficiency across the Company’s estate.

The Board and Audit Committee approved the Group’s

TCFD content in the FY24 Annual Report and Accounts.

The risk management and internal control framework

is overseen by the Audit and Risk Committee and

reports received by the committees have supported

the Board to ensure that climate-related risks have

been identified, categorised and assessed and are

well managed.

The Board recognised the opportunity to engage with

policymakers in support of ensuring electric and hybrid

vehicles were available to consumers in the mid-cost

and near-prime consumer credit market.

Links to strategic themes

Links to s.172

Effective stakeholder communication continued

78 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Stakeholder engagement and decision making continued

Effective engagement

withshareholders:

InvestorRelations

There has been consistent active dialogue

withshareholders during 2025 in line with

theGroup’s Investor Relations engagement

strategy. Various meetings throughout the year,

attended by the Chief Executive Officer, Chief

Financial Officer and Chairman, served to build

positive relationships with new and existing

shareholders. The Chairman hosted a governance

roadshow in May 2025, meeting institutional

shareholders. The Annual General Meeting took

place in May, with all shareholders encouraged

to attend the meeting and participate through

voting on the resolutions.

The Group’s share price increased by 169% in

2025, following a return to profitability and

sustained balance growth. The uncertainty

around complaint costs and the motor finance

Court of Appeal judgment depressed the share

price during the first part of the year, but the

trajectory was largely positive following the

announcement of the 1Q25 trading update in

May 2025 and subsequent updates during the

year. This reflected the market recognition of

management delivery against the strategy and

financial guidance and the risk associated with

external factors receding.

Key communication touchpoints with investors are:

The Group’s website

The corporate and customer-facing websites

were combined during the year, enhancing user

experience. Investors can find information about

our Board and governance framework and

explore the products offered to our customers in

one place. A full history of the Group’s market

announcements and presentations is available

on the website.

The Annual Report and Accounts

This document provides shareholders with a

detailed description of the Group’s purpose,

strategy, products, performance and initiatives

taken throughout the year to deliver long-term

sustainable success.

The Annual General Meeting

Shareholders are invited to attend the AGM

each year to meet directly with the Board.

Participation and shareholder questions are

welcome at the AGM, and there is an opportunity

for informal conversation after the meeting.

In2026 the AGM will be held in Bradford at

theGroup’s newly refurbished head office.

Shareholders

The Board spent time during the year deepening its

understanding of the Group’s shareholders. The Board

considered the composition of the share register and

discussed opportunities for investor engagement and

diversification. Regular direct engagement took place

between the Board and our shareholders throughout

the year, including following the announcement of our

quarterly results, at investor conferences and other

events and at our Annual General Meeting. As a result

of the Group’s efforts to connect and communicate

clearly with investors, the Group attracted new

investment. The Board would like to develop wider

stakeholder relationships, through the refresh of the

Group’s communications strategy, designed to

communicate our customer-first and inclusive

approach to banking.

The Chair of our Remuneration Committee, Graham

Lindsay, wrote to major investors regarding proposed

changes to the Group’s Directors’ Remuneration Policy,

which will be voted on by shareholders in May at the

AGM. The communication received engagement and

consideration was given by the Remuneration

Committee to the feedback received.

The Group’s commercial and corporate websites were

combined and refreshed under the new brand,

bringing investors and customers closer together.

Please see page 9 for our investment case.

Links to strategic themes

Links to s.172

79 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Shareholder informationFinancial statementsStrategic report

Composition, succession and evaluation

Board composition (as at 31 December 2025)

Board

tenure

Executive

Committee

and direct

reports

Board gender

diversity

Board ethnic

diversity

Member attendance at Board and committee meetings in 2025

The table below sets out the Board and committee attendance during the year. Attendance is shown as the number of meetings attended out of the total

number of meetings possible for each individual director. Attendance was very strong during the year at both scheduled and additional meetings. The Board

continues to be satisfied that each director is able to allocate sufficient time to the Company. The Chair of each committee reports regularly to the Board on

how that committee has discharged its responsibilities. The absences shown below were a result of an urgent personal matter or a pre-arranged commitment.

All non-executive directors have an open invite to attend all the committees, numbers that have a * next to them represent their attendance at a committee they

are not a member of.

Board member Board Ad hoc

Audit

Committee Ad hoc

Nomination and

Governance

Committee Ad hoc

Remuneration

Committee Ad hoc

Risk

Committee Ad hoc

Total number

ofmeetings 8 3 6 — 3 — 3 1 5 2

Sir Peter Estlin 8/8 3/3 6* — 3/3 — 3* 1* 5* 2*

Ian McLaughlin 8/8 3/3 6* — 3* — 3* 1* 5* 2*

Michele Greene 8/8 3/3 2* — 3/3 — 1* — 5/5 2/2

Dave Watts 8/8 3/3 6* — — — 3* 1* 5* 2*

Graham Lindsay 8/8 3/3 6/6 — 3/3 — 3/3 1/1 2* 2*

Karen Briggs 8/8 3/3 5/6 — 3/3 — 1/1 2* 1* 3/4 2/2

Oliver Laird 8/8 3/3 6/6 — 3/3 — 3/3 1/1 1* 2*

Jackie Noakes 8/8 3/3 1* — 3/3 — 2/2 1* 1/1 5/5 2/2

Board Skills Matrix

This Board Skills Matrix represents the number of directors with core or

supplemental capability in areas that are relevant to the Group’s business

model and strategy. A core capability is one of the strongest areas of a

director’s skill and expertise, where they bring significant value to Board

discussions. A supplemental capability is an area where the director has

enough knowledge and experience to carry out their role. This Board Skills

Matrix, together with the biographies on pages 66 and 67, shows the combined

strength of our Board in areas central to delivering the Group’s strategy.

1. Leadership

2. Strategy, oversight and

implementation.

3. Audit and financial reporting

4. Customers and Consumer Duty/

customer vulnerability

5. Product development

6. Banking

7. UK banking regulation

8. Shareholder engagement

9. Change management

10. Secured loans

11. Cards (near to sub-prime)

12. HR, talent and employee

engagement

13. IT strategy and digital initiatives

14. Capital management and

treasury

15. Risk management

16. M&A transactions

17. Regulatory landscape and

engagement

18. Cyber crime, cyber security and

risk

19. Environmental impact

Category

7 1

6 2

3 5

5 2

6 2

3 5

7 1

6 2

5 2

7 1

6 2

5 2

Core capability Supplemental capability

Male 5

Female 3

White 90%

Ethnically diverse 10%

0-2 years 7

2-5 years 0

5-9 years 1

Male 64%

Female 36%

80 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Director induction and training

Director induction process

Our induction programme is designed to give

directors an in-depth understanding of the

business and its purpose, culture, and values.

The induction, designed and arranged by the

Chief People Officer in consultation with the

Chair and General Counsel and Company

Secretary, includes meetings with existing

directors, members of theGroup Executive

Committee and other key stakeholders, which

may include the Group external auditor, external

advisors, our brokers, and representatives from

the FCA and PRA. All new directors are provided

with access to our secure Board meeting

software, which provides induction materials

including Group policies, structure charts, terms

of reference, the Delegated Authorities Manual,

and past Board and committee meeting papers

and minutes. Nonew directors joined the

business in 2025.

Ongoing director training

It is important that our directors are made

aware of any upcoming developments and

receive training tailored to their roles at the

Company, given the ever-changing economic

and regulatory environment.

Directors undertake training both as a whole

Board and based on individual requirements

toassist them in carrying out their duties and

responsibilities. At least annually, the Chairman

discusses with each director his or her contribution

to the work of the Board and personal

development needs, with each member being

required to retain a record of their continuous

professional development. The Group Secretariat

maintains a record of all training undertaken

bydirectors during the year.

During 2025, the directors were provided with

deep dives, teach-ins, briefings and

presentations on a range of key subjects,

including the following:

5 cyber and ransomware;

5 bid defence and takeover code;

5 UK MAR and directors duties;

5 take over simulation; and

5 Artificial Intelligence – landscape and issues

for banks.

Director training schedule 2026

Examples of the training expected to form part

of the 2026 training programme include:

5 cyber security and operational resilience;

5 Artificial Intelligence;

5 Basel 3.1;

5 ESG; and

5 brand and marketing.

The director training is overseen by the General

Counsel and Company Secretary and can be

internally or externally facilitated, with sessions

typically originating from technical Board

discussions or an identified training opportunity.

Directors are requested to refresh their

understanding of current obligations and recent

developments in areas pertinent to their role.

They are also given access to an external online

academy tool, which provides a wide array of

briefings, education and bespoke training. The

General Counsel and Company Secretary is

reactive to any emerging training needs in

response to the wider business environment.

Each year management carries out a fit and

proper assessment for all senior managers and

certified colleagues under the SMCR process.

This process involves requesting annual learning

and development plans that are forward

looking for our executive team members. The

Talent Team is also engaged in the process to

ensure all annual mandatory training has also

been completed.

81 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Board Performance Review

During 2025, the Board implemented the actions identified during the 2024 Board evaluation and reported last year:

Maintain the ongoing review of Board skills and composition. The Board skills and composition remained under review throughout 2025. You can read about this

in the Nomination and Governance Committee Report on page 84. The Committee concluded that,

following Board changes in January 2025, the Board composition remains optimal and a diverse

pipeline remains the focus of succession planning. The Board training plan (page 80) reflects the

development needs identified by the Board skills assessment.

Consider reducing the size of the Board, relative to the reduced size of the business. The size of the Board reduced during the year, following the departure of Paul Hewitt and Angela

Knight in January 2025. The Board agreed that its size is now commensurate with that of the business

and further reduction may result in increased skills gaps in key areas and isn’t recommended.

Consider whether the governance structure could be streamlined and optimised to avoid

unnecessary duplication.

During the year, invites to all Board committees were open to all non-executive directors, which

minimised unnecessary duplication.

Consider extending the remit of the Nomination and Governance Committee to include

governance, freeing space on the Board agenda for more strategic matters.

During 2025, the Nomination Committee extended its remit to include governance, and focus was

given to agreeing which items were best tabled at the Committee meeting or required whole Board

discussion (see page 84), given the largely parallel membership.

Encourage more informal engagement between the Board members and the wider workforce. Throughout 2025, informal engagement with colleagues was a Board focus (see pages 22 and 74

for full details and outcomes of this engagement).

The Board remains committed to

continuous improvement and strives

toensure effective leadership for the

sustainable success of the Company.”

Sir Peter Estlin

Chairman

82 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Board Performance Review continued

In line with the three-year cycle reported last

year, the 2025 Board Performance Review was

externally facilitated by Independent Audit Limited

(Independent Audit). Independent Audit was

selected following its facilitation of a hybrid review

in 2024. Aside from in its capacity as independent

facilitators of the Board Performance Review,

there is no other contractual connection between

the Company and its directors and Independent

Audit and its employees. The contents of this

section of the Annual Report have been reviewed

and approved for publication by Independent

Audit. Independent Audit uses its effectiveness

model, which looks at what the Board does

andhow it does it, ‘RAG’ rating each area,

toreach a conclusion on effectiveness and

development areas.

2025 Board Performance Review process

Process

Independent Audit

was approved as

external facilitators

of the Performance

Review.

Independent Audit

had an initial meeting

with the Chairman

followed by a more

extensive scoping

meeting with the

General Counsel

andCompany

Secretary and

Deputy Company

Secretary.

A combination

formatwas agreed,

comprising an

anonymous

questionnaire

followed by a

one-on-one interview

with Independent

Audit, the output

ofwhich remained

anonymous and

would be reported

tothe Board

thematically. Each

Board committee

anda meeting of the

Board would be

attended, observed

and assessed by

Independent Audit.

The General Counsel

and Company

Secretary reviewed

the proposed format

of the questionnaire

and agreed that it be

extended to senior

management and

regular Board

attendees.

Observations of each

Board committee

(except Disclosure)

and the Board took

place between June

and September 2025.

The final report was

discussed with the

Chairman ahead

offinal presentation

to the Board in

December.

Independent Audit

attended the

December meeting

for an in-depth

discussion with the

Board, following

which an action plan

was developed.

Independent Audit

offered all directors

the opportunity for

aprivate discussion

on the output of

thereview.

Group Company

Secretariat

developed an

actionplan, based

onthe report, Board

discussion thereof,

and individual

director input

(seepage 83).

2022

External

2023

Internal

2024

Hybrid

2025

External

83 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Board Performance Review continued

Conclusions

The Board Performance Review concluded that financial oversight, risk management and

stakeholder consideration were notable Board strengths, facilitated by a strong committee

structure and approach to continuous development. The diversity, engagement and supportive

approach of the Board members were commended, particularly in the challenging

transformational environment. The range of Board skills and experience was also noted, despite

the smaller size of the Board. The strengthened Executive Committee and improved quality and

flow of Board information were cited as key positives. There was an overarching theme of a

much-improved position, combined with an acknowledgement that key development areas

remained, in particular for the Board to step back from operational detail and increase its

strategic focus, within the context of the Group’s return to profitability after a challenging

period. These development areas are reflected in the agreed ‘action plan’, see right.

Committees

The review concluded that the Audit Committee was managed well, facilitating good challenge

from all NEDs within a positive atmosphere, under the leadership of an accessible Chair.

Suggestions were made to improve clarity of action articulation and review the cadence and

number of meetings. The Remuneration Committee was described as equally well run, inclusive

and effectively led by the personable Chair. Similarly, the Risk Committee was described as

being thorough, constructively challenging and led by an insightful Chair, with a deep

knowledge of the business. Suggestions were made to ensure more systematic committee

reporting to the Board and to prioritise the input of committee members over other attendees.

Chairman

The Review noted the Chairman’s drive, determination and clarity of vision, complemented by

an accessible approach and openness to feedback. The Review suggested that thought be

given to a private NED session ahead of each meeting to enhance the flow of the meeting and

facilitate equality of contribution across all members.

An action plan for implementation during 2026 was developed based on the thematic

feedback and areas for development identified in the Review. Although not exhaustive,

thebelow table shows the key actions agreed.

Theme Action agreed

Strategic focus and horizon scanning

Improve Board reporting to allow the Board to step

back from the operational detail and therefore

increase focus on the long-term strategic plan.

Ensure that product deep dives and Board

training have a future-focused element.

Administrative/meeting management Develop the Board paper template to ensure it

is focused on the ‘ask’ from the Board and

grounded in the execution of strategy.

Develop the agenda format to facilitate

private NED sessions and sufficient time for

strategic discussion.

Standardise committee reporting to the Board.

Board dynamic, culture, and interaction

withmanagement

Expand opportunities for Board engagement

with senior management.

Facilitate post-meeting reflection sessions.

84 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Shareholder informationFinancial statementsStrategic report

Nomination and Governance Committee Report

Role of the Committee

The Nomination and Governance

Committee is responsible foroverseeing:

5 the evaluation of the Board and its

committees which includes overseeing

the Board’s composition, size and

structure, including the Board

committees, so that it remains

appropriate and effective in order

todeliver the Company’s strategy;

5 the Board appointment and

succession planning processes;

5 the Group’s talent management

framework and senior management

succession planning to ensure the

Group’s leadership needs are met

now and in the future;

5 the diversity of the Board and the

Group’s talent pipeline to meet the

Group’s diversity objectives; and

5 the Group’s governance framework.

Ensuring effective leadership

forsustainable success

Dear shareholder

I am pleased to present an overview of the work

of the Nomination and Governance Committee

during 2025. All non-executive directors continue

to be members of the Committee (biographies

on pages 66 and 67, and meeting attendance

on page 79) and the Committee’s operation was

deemed effective by the recent Board

Performance Review.

As reported last year, Paul Hewitt and Angela

Knight stepped down from the Board on 29th

January 2025, representing the final stage of the

transition to a smaller Board, aligned with the

Group’s size and greater need for agility. Since

January, the Board has remained unchanged

and the Committee views the current size and

composition of the Board as optimal. The Board

Performance Review confirmed a strong and

collaborative Board dynamic. It is therefore

recommended that all directors be reappointed

at the forthcoming AGM.

In line with its expanded remit, reported last

year, in December 2025 the Committee reviewed

the Group’s compliance with the UK Corporate

Governance Code (page 65) and the wider

Group governance framework covering senior

management functions, which was found to be

operating effectively.

Board appointments, succession

planning and diverse pipeline

Following significant change to Board

composition during 2024, the Board has remained

stable during 2025, facilitating the Group’s

transformation agenda to return to profitability.

Board composition remains under constant

assessment, informed by the Board Skills Matrix

(page 79), Board Performance Review (pages 82

and 83) and succession needs. Whilst there was

no need to conduct a formal recruitment process

during 2025, the Committee considered Board

succession planning in September 2025 and

agreed to continue its approach of maintaining

a continuous pipeline of candidates, identified

by our in-house executive search team. The

search team, in conjunction with the Chair, seeks

to identify suitable candidates, intentionally

looking beyond ‘the usual suspects’ to consider

candidates with varied transferable skills to

achieve Board diversity objectives and optimal

skills mix. This agile approach to succession

planning and recruitment allows quick response

to any evolution of the Group’s strategy or

external landscape and consequent leadership

needs. The majority of the Board being relatively

newly appointed, the Committee agreed that

succession planning for Graham Lindsay,

currently serving his third term, was the

immediate priority and would include the

transition of the Remuneration Committee

Chairrole.

In June 2025, the Committee discussed senior

management talent and succession planning,

recognising the role of a strong executive team

for both the long-term success of the Company

and to facilitate the Board’s effective oversight

of strategy. The focus of Committee discussion

was the need to ensure both a healthy internal

pipeline for pivotal roles, but also to ensure an

ability to react to external factors, which may

influence future skill set requirements.

The Committee seeks to

ensure effective leadership

and an optimal skills balance

on the Board through

continuous assessment and

identification of development

needs, alongside succession

planning to position the

Group for long-term success.”

Sir Peter Estlin

Nomination and Governance Committee Chair

The Committee’s Terms of Reference are

available at: www.vanquis.com/investors

Diversity 11%

Succession and talent 44%

Board composition

andappointments

12%

Governance 33%

Allocation

of time

85 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Nomination and Governance Committee Report continued

Evaluation of Board effectiveness,

skills, and composition

The outcome of the Board Performance Review

was considered by the Board, rather than the

Committee, in December 2025, given alignment with

the membership of the Committee and to ensure

sufficient agenda time was available. You can read

about the conclusions and see the resulting action

plan on page 83. The Committee was pleased to

note the Performance Review’s recognition of the

Board’s diversity, engagement and insight.

In December 2025, the Committee reviewed Board

committee membership, concluding that committee

composition continued to be effective and compliant

with the UK Corporate Governance Code. The

outcome of the 2025 Board skills assessment was

debated, the matrix having been refreshed during

the year. The Committee concluded that whilst the

Board maintained a positive mix of skills and there

was evidence that targeted training during the year

had increased scores in some key areas, technology

and, specifically, Artificial Intelligence, remained the

lowest scoring areas. These findings will inform the

Board training plan for 2026 (page 80) and pipeline

succession planning. The Committee has

acknowledged the need for technology expertise to

be a key factor in succession planning across the

organisation, especially given the planned Gateway

delivery during 2026 and embedding of our

digital-first approach.

The Committee also considered the effectiveness

and performance of the executive directors, the

Executive Committee and the Chairman during

the year, utilising private sessions as required. The

SID communicates the outcome of the Chairman’s

performance review to the Chairman and agrees

a development plan as required. The Committee

provided input to the CEO on Executive

Committee performance.

Inclusion and diversity

You can read about our approach to inclusion

anddiversity (I&D) on pages 28 and 29 and in

December the Committee agreed that the annual

I&D Policy review should be tabled at the Board

meeting to allow sufficient time for discussion.

TheBoard recognises the need for diversity across

the organisation, facilitating a mix of ideas and

perspectives to better execute our inclusive strategy

(pages 14 and 15) and serve the needs of our diverse

customer base. The Board equally continues to

support the creation and embedding of an inclusive

culture, allowing all colleagues the opportunity to

contribute to the delivery of strategy.

In reviewing the Group’s progress against its diversity

objectives, the Board noted continued compliance

with the Parker Review target for at least one

director to be from an ethnic minority background

and approximate compliance with the FCA Listing

Rule requirement for the Board to be 40% female,

this now being 37.5% due to the reduction in the size

of the Board during the year (see below). The Group

is a signatory to the Women in Finance Charter and

continues to work towards the target of 40% female

representation in senior leadership (December 2025:

33%). As detailed previously, inclusion and diversity

is embedded into our recruitment and succession

planning processes to facilitate continued

achievement against our objectives.

Key I&D highlights

5 Ian McLaughlin recognised in Involve’s

Outstanding Advocates Role Model

List2025.

5 Read and Write software introduced

tosupport neurodiverse colleagues.

5 Expansion of the Women’s Network,

withclear action plans articulated.

5 Awarded, for the third year running, the

Silver Standard for LGBTQ+ excellence

infinancial services by LBGTGreat.

5 Continued partnership with

NationalNumeracy.

5 Regular ‘wellbeing’ webinars for

colleagues hosted throughout theyear.

Explanation against UKLR 6.6.6(9) and data under UKLR 6.6.6 (10)

As at the Company’s chosen reference date, 31December 2025, and at the time of publishing this report, and

in line with FCA UK Listing Rule 6.6.6(9), the Group confirms it has 37.5% female representation on the Board

(three out of eight directors) which approximately meets the target for at least 40% female representation

onthe Board. The Group also confirms that it meets the target that one of the senior positions of Chair, SID,

Chief Executive or Finance Director is held by a woman, with Michele Greene appointed as SID on 29January

2025, replacing Angela Knight. As explained in last year’s Annual Report, the Group previously met the 40%

target and the percentage has reduced to 37.5% due to the reduction in the size of the overall Board. The

Board believes that eight directors is an appropriate-sized board for the Group and, accordingly, has no

plans to appoint further directors to the Board at present. However, in accordance with its Board Diversity

Policy, the Group will take diversity factors into account in future Board succession planning. The Company

also confirms that it has met the target for one director to be of an ethnic minority background.

Our approach to the accurate collection of gender and ethnic diversity data is robust; the data collection

process involved issuing a survey via a secure platform designed in collaboration with our data protection

team, which was preceded by a briefing to all participants.

Gender representation as at 31 December 2025

Board Executive Committee

Number

of Board

members

Percentage

of the

Board

Number of

senior positions on

the Board (CEO,

CFO, SID and Chair)

Number in

executive

management

Percentage of

executive

management

Men 5 62.5% 3 6 67%

Women 3 37.5% 1 3 33%

Prefer not to say/other/unspecified — — — — —

Ethnic representation as at 31 December 2025

Board Executive Committee

Number

of Board

members

Percentage

of the

Board

Number of

senior positions on

the Board (CEO,

CFO, SID and Chair)

Number in

executive

management

Percentage of

executive

management

White British or other White

(including minority-White groups) 7 87.5% 3 8 88.9%

Mixed/multiple ethnic groups — — — — —

Asian/Asian British — — — 1 11.1%

Black/African/Caribbean/Black British

1 12.5% — — —

Other ethnic group — — — — —

Not specified/prefer not to say — — — — —

Sir Peter Estlin

Nomination and Governance Committee Chair

25 February 2026

86 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Shareholder informationFinancial statementsStrategic report

Audit Committee Report

Role of the Committee

The Committee is responsible for overseeing the Group’s risk management and internal control

framework, in conjunction with the Risk Committee, and has key duties in respect of financial

reporting, external audit and internal audit.

Financial reporting

5 The Committee monitors the integrity

ofall published financial information,

including significant judgements. The

Committee advises the Board regarding

the Group’s ongoing viability and going

concern status, alongside confirming that

the Annual Report and Accounts is fair,

balanced and understandable.

External audit

5 The Committee assesses the performance

and effectiveness of the external auditor,

including its independence and objectivity.

The Committee is responsible for

overseeing the Group’s policy on

non-audit services.

Internal Audit

5 The Committee approves the Internal

Audit Plan and oversees the effectiveness

of the Internal Audit function.

The role and responsibilities of the Committee

are set out in full in the terms of reference,

which were last reviewed and updated

inOctober 2025 and are available on our

website. The Committee completed aself-

assessment of compliance with its terms of

reference and has fully complied with its

duties and responsibilities in 2025.

Audit, assurance and

internalcontrol

Dear shareholder

I am pleased to present a report on the

activities of the Audit Committee during 2025.

Following the resignation of Paul Hewitt and

Angela Knight on 29 January 2025, Committee

membership has remained consistent throughout

2025. I chair the Committee and Graham Lindsay

and Karen Briggs are members (biographies on

pages 66 and 67). TheCommittee has recent

and relevant financial experience and expertise

that meet the criteria set out in the UK Corporate

Governance Code and FCA Disclosure and

Transparency Rules (DTRs).

The Chairman of the Board, Chief Financial

Officer, Chief Executive Officer, Internal Audit

Director, Chief Risk Officer and the external

auditor are standing attendees. The Committee

met six times during 2025, and member

attendance is on page 79. The Committee has

held private sessions with both the internal and

external auditors without management present

during the year.

The Board Performance Review was facilitated

externally as per the Group’s three-year cycle,

and concluded that the Audit Committee had

operated effectively with good challenge from

members. The report regarding the full Board

evaluation is on pages 82 to 83.

Robust conversations and

constructive challenge

during meetings helps

safeguard our control

environment.”

Oliver Laird

Audit Committee Chair

The Committee’s Terms of Reference are

available at: www.vanquis.com/investors

Governance 11%

Internal audit 24%

External audit and

financial reporting

53%

Management reporting 12%

Allocation

of time

87 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Audit Committee Report continued

Key Committee activities

Some key focus areas for the Committee during

2025 were:

Accounting policies

The Committee oversaw the enhancements made

to the Effective Interest Rate (EIR) accounting

during the year following growth of balance

transfers in the Cards business. The Committee

approved the Group Accounting Policy, noting the

inclusion of EIR accounting and that the Group’s

policy was in compliance with applicable

International Financial Reporting Standards (IFRS).

The Committee noted management’s preparations,

implementation approach and timeline for the

adoption of IFRS 18 which will be progressed

during 2026 and in advance of the reporting

requirement from January 2027. A gap analysis of

current reporting practices will be completed and

new reporting templates designed, built and

tested. Adopting a proactive and structured

approach will help ensure the Group is well

positioned to meet the standard effectively.

Vehicle Finance commissions

accountingjudgement

The Committee scrutinised the accounting

judgement made relating to the UK Supreme Court

ruling regarding motor finance commissions. The

ruling was handed down in August 2025 following

which the FCA announced its consultation on an

industry-wide motor finance compensation

scheme. The Committee considered in detail the

Group’s basis for its accounting judgement both

before and after the Supreme Court ruling, taking

into consideration legal and other independent

views, including that of the external auditor. The

Committee reviewed the Vehicle Finance

Compensation Scheme accounting judgement,

including the application of the IAS 37 assessment

and resulting provision calculation. The Committee

has encouraged active engagement with the FCA

on the key proposals within the consultation and

regarding scheme administration and the

approach to customer communication.

Financial Reporting Council review

The FRC completed a review of the Group’s

Annual Report and Accounts FY24 as part of its

regular review and assessment of the quality of

corporate reporting in the UK. The Committee

received the correspondence and oversaw

provision of the Group’s responses, ensuring any

enquiries raised were addressed. The FRC has

confirmed that its enquiries have been closed.

More information about the review, including the

output, can be found in note 35 on page 192.

Other Committee activities in FY25 have included:

5 review and approval of the Internal Audit

Plan, including approval of any changes to

the plan;

5 consideration of regular reports from the

Internal Audit Director, including updates

regarding Internal Audit resource, audit

reports and findings;

5 receipt of Internal Audit’s year-end opinion,

statement of independence and objectivity

and approval of the Internal Audit Charter;

5 discussions regarding IFRS 9 model

implementation, embedding and

performance including as part of the key

accounting judgements;

5 consideration of the impact of climate-

change on the financial statements and the

Group’s climate-related disclosures;

5 review and recommendation to the Board

the half-year and year-end financial

statements, including the going concern

assumption and viability statement at the

year end;

5 considering feedback from External Audit

regarding management responses to the IT

and non-IT control observations raised by

the external auditor;

5 assessed the effectiveness of the external

auditor and quality of the audit and

scrutinised feedback from the FY24 audit;

and

5 considered a review of the Finance function,

noting the structure, operating effectiveness,

future priorities and opportunities.

At the end of 2024, the Committee’s terms of

reference were updated to ensure compliance

with the updated UK Corporate Governance

Code Provisions 25 and 26. The most significant

area of update related to the tender process for

the appointment of a new auditor. Whilst this

was not an area of focus for the Audit Committee

during 2025, given the incumbent auditor’s

tenure, the new requirements will be factored

into the next tender process, with the Finance

function aware of the need to start the transition

process early to facilitate the transition of any

non-audit services currently provided by any

potential tendering firm.

Committee priorities in 2026 are:

5 to oversee delivery of the assets and

liabilities management system;

5 implementation of IFRS 18; and

5 continued focus on internal controls,

ensuring compliance with the UK

Corporate Governance Code including

tracking improvements in IT controls

asthe IT platform modernisation

progresses to delivery.

88 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Audit Committee Report continued

Fair, balanced and understandable

Having regard to Provision 25 of the Code,

andthe Board’s responsibilities therein, the

Committee considered whether the 2025 Annual

Report and financial statements, when taken as

a whole, was fair, balanced and understandable.

The Committee adopted a robust process as in

prior years to justify the statement. This included:

5 reviews to provide input, and feedback

incorporated into subsequent drafts;

5 oversight of the process, evaluation and

verification by Group senior management;

5 external evaluations of the Remuneration

and Governance Reports respectively; and

5 private sessions with the external auditor.

As part of the year-end processes, the Committee

considered management’s areas of significant

judgements, estimation, and uncertainty and

emerging issues as set out in the financial

statements on pages 148 to 151, and with the

external auditor, scrutinised and challenged

thegoing-concernassumptions.

In assessing compliance with the Code, the

Committee considered the following criteria:

Is the report fair?

5 Is it a full reflection of events throughout

theyear and consistent with messages

communicated throughout the year?

Is the report balanced?

5 Is the narrative reporting consistent with

thefinancial reporting?

Is the report understandable?

5 Is it presented in a logical order and using

clear language?

5 Are important messages clearly highlighted

as such?

5 Is information shown in tabular or graphic

form where this would assist the reader?

Conclusion: The Committee concluded that, in its

opinion, the 2025 Annual Report and financial

statements, when taken as a whole, was fair,

balanced, and understandable, and

recommended this assessment to the Board.

Financial reporting process, internal

control and risk management

systems

The Committee receives regular reports regarding

the effectiveness of risk management systems

and internal controls. Overseen by the Committee,

Internal Audit has carried out a Transformation

Assurance programme throughout the year which

comprises three ongoing audits focused on

business controls, IT controls and change delivery.

Reports from the Transformation Assurance

programme are reviewed by the Committee

regularly, enabling close monitoring of the

progress of the IT control modernisation and

resolution of control issues on legacy IT systems.

In addition, Internal Audit has completed

bespoke audits on material controls and key

financial controls which have been reported to

the Committee. The Committee noted that the

material controls audit concluded that the

second line assurance team had established

areliable and repeatable approach to testing

the material controls.

The Committee has worked in conjunction with

the Risk Committee, noting that members

regularly attend both committees, to oversee

execution of the integrated assurance plan.

Work continues to mature the Group’s capability

for Risk and Control Self-Assessment, with

actions underway being reported to and

tracked by the Risk Committee. You can read

more about this on page 93.

2026 Internal Audit year-end opinion

The Committee received the Internal Audit

year-end opinion in January 2026, which confirmed

that the overall control environment has remained

broadly stable. Internal Audit considered six key

questions on the effectiveness of governance,

riskand control and concluded that:

5 the Group control environment had

remained stable throughout the sustained

period of transformation, with consistent

audit outcomes;

5 senior leadership had set a positive tone on

risk and control;

5 change delivery had matured during the

year;

5 activity to evolve the risk management and

internal control framework had been

undertaken; and

5 the Risk, Compliance and Finance functions

had strengthened capability.

Internal Audit

The Internal Audit function, led by the Internal

Audit Director, provides independent, risk-based

and objective assurance to the Board, reported

through the Audit Committee. This expert advice

and insight supports the Board to protect and

sustain value over the long term. The Internal

Audit Director reports to the Committee at each

meeting and is a standing attendee. Internal

Audit has full access to all functions, data,

records, information, physical property, and

personnel required to carry out its

responsibilities. Internal Audit is supported by

specialist third parties, where required, under the

terms of the Group’s Non-Audit Services Policy.

The Committee approves an annual Internal Audit

plan, which has been designed in conjunction with

business activity, emerging risks and second line

assurance activity. The Committee tracks delivery

of the audit plan and approves any amendments

to the plan where necessary.

The Committee is satisfied that Internal Audit is

both independent and effective and has the

appropriate skills, experience and resources,

either in house or through specialist third parties,

to fulfil its mandate.

Independence

As required under the Institute of Internal

Auditors Code of Practice, the Internal Audit

Director has no responsibilities outside of

oversight of the Internal Audit function, and

reports directly to the Chair of the Committee,

with an administrative reporting line to the

Group Chief Executive. The Committee holds

regular private sessions with the Internal Audit

Director, who also meets privately with the Chair

quarterly or upon request. Independence of the

Internal Audit function is confirmed by

theInternal Audit Director through an

annualattestation.

Effectiveness

The Internal Audit Charter is approved annually,

and the Committee regularly monitors progress

against the plan. Confirmation is also provided

that the function remains appropriately

resourced and has sufficient expertise to carry

out its mandate. The Internal Audit Director is

actively encouraged to raise any concerns

during each private session with the Committee.

89 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Audit Committee Report continued

External Audit

Appointment and tenure

Deloitte LLP was appointed as external auditor

in 2022 following a formal tender process in

2020, for a maximum period of 10 years. The

Committee is authorised to instigate a formal

tender process at any time. The Committee

Terms of Reference have been enhanced to

incorporate the end-to-end participation of all

Committee members in the Group’s next tender

process, as required by the Audit Committees

and the External Audit: Minimum Standard.

Transitional arrangements would be made

before the end of the incumbent auditor’s tenure

and monitoring of the provision of significant

non-audit services commences at least three

years in advance of any invitation to tender

being issued.

Having assessed the performance and

independence of the external auditor, the

Committee resolved that Deloitte LLP continued

to be independent and effective and will be

recommended to shareholders for reappointment

at the AGM on 6 May 2026.

Effectiveness

The Committee assessed the performance of

theexternal auditor in May 2025 against the

following criteria: quality of service, timely and

insightful communication, technical expertise,

team engagement, governance and regulation.

Overall performance ratings decreased

marginally for the FY24 audit compared to

FY23.The Committee noted that the outcome

ofthe review had been shared with the external

auditor, and an action plan had been agreed.

Improvements to timely, insightful communication

and early engagement on additional requirements

were delivered in the year.

The Committee holds private sessions with the

external auditor without management present

during which Deloitte is invited by the Committee

to raise any concerns and comment on any

ongoing matters. The Committee has noted

theexternal auditor acting objectively and

challenging management such as regarding

theVehicle Finance commission judgement and

inthe audit of the IFRS 9 models.

Independence and objectivity

The Committee is responsible for maintaining

adequate safeguards to ensure the independence

and objectivity of external audit. These include:

5 a policy that restricts the recruitment of

individuals employed by the external

auditorinto positions that provide financial

reporting oversight or exercise influence

overfinancial and regulatory statements;

5 non-audit work is subject to the policy

detailed below and the non-audit team

does not prepare anything that would be

relied upon in the Group audit;

5 work performed is subject to an independent

professional standards review and

engagement quality control review process;

5 the Committee considers the reappointment

of the external auditor, including the rotation

of the audit partner, annually. The review

considers both independence and effectiveness,

primarily using a scorecard system. The lead

audit partner, Kieren Cooper, has been in

place since May 2022; and

5 the external auditor attests its

independence and objectivity to the

Committee on an annual basis.

Non-audit work

The Committee approved an updated Non-Audit

Fee Policy in December 2025. The policy, which

complies with the FRC’s Guidance on Audit

Committees (2023), the EU Audit Directive and

Regulations 2025 and the FRC’s Revised Ethical

Standard (2024), states that the external audit

firm may only be engaged for permitted

non-audit services where it is the most

appropriate provider and provided there is no

threat to independence or objectivity. Total

non-audit fees are capped in the policy and

must not exceed 70% of the average statutory

audit fees over the most recent three-year

period. The award of non-audit work to the

external auditor is monitored by the Committee,

and the Chair of the Audit Committee must

approve, in advance, any single award, or

programme of non-audit work in excess of

£50,000 per annum. Approval by quorum of

theAudit Committee is required to approve

non-audit work in excess of £250,000. Deloitte

LLP’s fees for non-audit work during the year

were £0.4m (2024: £0.4m). The ratio of audit

tonon-audit fees was 7.6:1.

90 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Audit Committee Report continued

Significant issues and areas ofjudgement

The Committee considers the critical accounting assumptions and key sources of estimation and

uncertainty regarding the Annual Report and financial statements 2025, which are on pages 148 to

151. The Committee discussed the issues set out in the table below with the external auditor

throughout the year, in addition to the Going Concern Statement.

Issue Judgement Actions

IFRS 9 and model developments including post-charge-off

asset (PCOA) valuation

Judgement is applied to the impairment allowance required. This

includes whether past performance provides a reasonable

estimate of future losses implicit within the PD, LGD and EAD.

A number of PMAs were recognised reflecting model refinements

and calibrations in the IFRS 9 models.

The macroeconomic model has been redeveloped in the year. The

models predict industry level write-off rates using a combination

of interest rates, unemployment rate, debt to income ratios and

earnings forecasts.

The Committee continued its work to oversee implementation,

embedding and operation of the IFRS 9 models during the year.

The Committee has considered the work performed by Deloitte to

independently recode and robustly examine model outputs to

validate management assumptions.

Provision for Vehicle Finance commissions

An assessment against IAS 37 to determine if a provision should

be recognised was performed.

Following the announcement of the FCA Scheme Consultation,

aprovision was recognised. Prior to that a contingent liability

was disclosed.

The Committee reviewed and challenged the key assumptions

used in the calculations and scrutinised legal and other

independent advice at both the half year and year end to

ascertain with as much precision as possible the judgement

beingmade.

Compliance Statement

The Group has fully complied with the Statutory Audit Services for Large Companies Market

Investigation (Mandatory Use of Competitive Tender Processes and Audit Committee Responsibilities)

Order 2014 throughout the 2025 financial year.

Oliver Laird

Audit Committee Chair

25 February 2026

91 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Shareholder informationFinancial statementsStrategic report

Risk Committee Report

Role of the Committee

The Committee is responsible for overseeing risk on behalf of the Board and is accountable

forensuring the effective management of risk, regulatory reporting and compliance across

theGroup.

5 Risk management and internal control:

The Committee oversees the design and

ongoingoperation of the Group’s risk

management and internal control

framework and, in conjunction with the

Audit Committee, assesses its effectiveness.

The Committee ensures that the principal

and emerging risks have been identified

and considered in the context of the Group’s

strategy, business model and culture. The

Committee considers risk appetite and

holds management to account for

performance against agreed metrics.

5 Regulatory reporting: The Committee

critically reviews and challenges the

Group’s ICAAP, ILAAP, Solvent Exit Plan

and Recovery Plan and provides informed

recommendations to the Board for

theirapproval.

5 Compliance: The Committee oversees

theGroup’s compliance arrangements,

including theGroup’s SMCR responsibilities

map, regulatory conduct and engagement.

The Committee ensures that effective

arrangements are in place for data

protection, anti-money laundering

arrangements and operational resilience.

The Committee’s role and responsibilities are

set out in full in its terms of reference, last

reviewed and updated in September 2025

and available on the Group’s website.

During the year, the Committee conducted

aformal self-assessment against its terms

ofreference and confirms that it has fully

discharged its duties and responsibilities.

Sustainable growth underpinned

by insightful risk management

The Committee used its

oversight of the risk

management and internal

control framework to

improve risk identification

and management,

strengthening resilience

asthe Group evolves.”

Michele Greene

Risk Committee Chair

The Committee’s Terms of Reference are

available at: www.vanquis.com/investors

Risk management

andinternal control

25%

Principal and

emergingrisks

23%

Risk appetite, framework

and policy

19%

Compliance and conduct 13%

Governance 6%

Regulatory and

prudential risk reporting

14%

Allocation

of time

Dear shareholder

I am pleased to report on the work of the

RiskCommittee during 2025.

Following the resignations of Paul Hewitt

andAngela Knight on 29 January 2025, the

membership of the Committee remained

unchanged for the remainder of the year. I chair

the Committee, alongside Committee members

Jackie Noakes and Karen Briggs. Karen Briggs

isalso a member of the Audit Committee,

supporting effective alignment across the Board’s

governance and assurance responsibilities.

The Chairman of the Board, Chief Risk Officer

(CRO), Internal Audit Director, Chief Executive

Officer, Chief Financial Officer and General

Counsel are standing attendees, enabling open

dialogue, effective challenge and timely

escalation of matters where appropriate.

The Committee met seven times during 2025.

Members’ meeting attendance is on page 79.

Two meetings were specifically focused on the

Group’s ICAAP and ILAAP.

The performance of the Risk Committee was

assessed as part of the Board evaluation, which

concluded that the Committee had operated

effectively with thorough and active participation

from members. A full report on the Board

evaluation is on pages 82 and 83.

At each regular meeting the Committee reviewed

the Group’s risk profile including principal and

emerging risks. Standing agenda items include

the CRO’s Report, minutes and actions.

92 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Risk Committee Report continued

Duringthe year the Committee also received

regular updates on complaints trends and the

delivery of the credit risk programme supporting

the Committee’s oversight of conduct, customer

outcomes and risk management capability.

Key Committee activities

During the year, the Committee oversaw

enhancements to the risk management and

internal control framework, strengthening the

Group’s alignment with Provision 29 of the UK

Corporate Governance Code 2024. Further

information on the Group’s risk management

arrangements, including its principal and

emerging risks, is provided on pages 54 to 61

and in the material controls section on page 94

of this report.

Credit Risk Enhancement programme

The Committee oversaw significant activity to

optimise credit risk management, aligned with

the delivery of enhanced technology through the

IT transformation programme (Gateway). This

included developments across lending, customer

targeting and collections. The Committee

reviewed management’s plans and closely

monitored the pace and quality of delivery,

applying its expertise and top-down perspective

to identify interdependencies and areas of risk.

The programme will continue into 2026 and will

remain a key area of focus for the Committee.

Solvent Exit Analysis

The Committee oversaw the development and

approval of the Group’s first Solvent Exit Analysis

(“SEA”) in response to the PRA requirement

effective from 1 October 2025 under Capital

Requirements Regulation SS2/24. The Committee

scrutinised the design, governance and execution

of the SEA, ensuring it was developed with

appropriate subject-matter expertise,

incorporated all mandatory components and

reflected proportionate rigour and balanced

professional judgement. The Committee ensured

that independent second- and third-line

assurance was obtained and that an external

benchmarking exercise was undertaken to assess

alignment with market practice. Committee

members and key executives also attended an

externally facilitated training workshop covering

the regulatory context, core requirements and

practical considerations of the SEA.

On this basis, the Committee concluded that

theSEA met regulatory expectations and was

comparable with peers in terms of quality,

depthand length.

Risk fundamentals including

policygovernance

The Committee monitored the effectiveness

ofthe Group’s risk management capability.

Thepolicy governance framework was reviewed

andupdated to strengthen consistency in the

development, implementation and management

of Group policies, including the introduction

ofastandard policy template and refreshed

policy hierarchy.

Risk culture and maturity remain areas of

ongoing focus. First-line Risk and Control

Self-Assessments (“RCSAs”) continued to mature,

and a third-line audit completed during the year

identified opportunities for further improvement.

Risk appetite refresh

The Committee oversaw the refresh of the

Group’s risk appetite framework. The Committee

scrutinised the design and structure of the

framework, including the clear articulation of

Board-owned risk appetite statements and the

supporting management-level metrics used to

monitor adherence. The work enhanced early

warning capability and bolstered the

Committee’s oversight of principal risks.

The Committee focused on ensuring the

refreshed framework was aligned with the

Group’s strategic priorities and regulatory

expectations, ahead of its implementation

andongoing monitoring from January 2026.

Principal risk activities

The Committee ensures there is full coverage

across and sufficient time spent overseeing the

Group’s principal and emerging risks facilitated

by the regular reporting from the CRO.

Committee activities within principal risk areas

have included:

Financial crime risk

The Committee provided oversight and

challenge on financial crime risk management

during the year, considering twice-yearly reports

from the MLRO covering fraud and financial

crime risks and the effectiveness of controls

across all products. The Committee approved

key financial crime policies and oversaw the

implementation of enhanced financial crime

systems including an automated transaction

monitoring system delivered through the

Gateway IT transformation programme.

Capital risk

The Committee oversaw and scrutinised the

Group’s Internal Capital Adequacy Assessment

Process (ICAAP) and recommended it to the Board

for approval. The Committee challenged

management on the methodology, assumptions

and outputs to ensure the ICAAP was prepared on

a sound, well-evidenced basis and appropriately

reflected the Group’s evolving business model, risk

profile and operating environment.

The Committee received independent assurance

from second- and third-line functions and noted

improvements in the clarity, precision and

regulatory compliance of the ICAAP. Following

submission, the Capital Supervisory Review and

Evaluation Process was completed during the

year, and I met with the Prudential Regulation

Authority (PRA) to discuss the Committee’s

oversight, challenge and contribution to the

ICAAP. The Committee will oversee and monitor

the impact of Basel 3.1 for the Group ahead of

the framework taking effect on 1 January 2027.

Funding and liquidity risk

The Committee oversaw and scrutinised the

Group’s Internal Liquidity Adequacy Assessment

Process (ILAAP) and recommended it to the

Board for approval. The Committee challenged

management on the methodology, assumptions

and outputs of the ILAAP, and reviewed

associated updates to the treasury risk appetite

to ensure alignment with the Group’s funding

strategy, risk profile and regulatory expectations.

Technology and information security risk

The Committee monitored progress of the

Gateway IT transformation programme and

itsimpact on the Group’s technology and

information security risk profile, supported by

regular reporting from the CRO and updates

from the IT Director. The Committee noted that

legacy technology and associated technical

debt were being actively managed and had

reduced during the year, and that Gateway

willremain a key area of focus throughout 2026.

In response to cyber attacks at several major

retailers, the Committee commissioned an

assessment of the Group’s information security

arrangements from the Group Chief Information

Security Officer and supported actions to

increase colleague awareness and vigilance.

Operational risk

The Committee oversaw a stable and improving

risk profile reflecting enhancements to the Group’s

operational risk arrangements. This included

arefreshed third-party risk management

framework and strengthened operational

resilience governance and policy arrangements.

Aspart of its horizon scanning activities, the

Committee commissioned and considered

areviewof the National Security Strategy 2025:

93 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Principal risk activities continued

Operational risk continued

Security for the British People in a Dangerous

World published by the UK Government in June

2025. TheCommittee recognised that the Group

was positioned to withstand the threats identified

and noted the actions already taking place across

operational resilience, third-party risk management

and cyber security resilience. The Committee

encouraged a continual improvement mindset and

will continue to oversee that the Group’s approach

remains proactive in strengthening resilience, in line

with regulatory expectations and for the benefit

ofallstakeholders.

Model risk

The Committee received regular updates on

theGroup’s model risk management position

andoversaw continued improvements to the

effectiveness of the model risk framework. This

included enhancements to model monitoring

andvalidation, clearer first-line accountability

formodel risk ownership, and the recruitment of

specialist expertise to strengthen independent

oversight. The Committee noted improvements in

model risk governance following the introduction

of a formal working group structure, supporting

clearer escalation, issue management and

regulatory alignment. As a result, the overall RAG

status of model risk improved during the year.

Business performance risk

The Committee scrutinised performance against

internal forecasts, key financial metrics and stress

testing outputs, including those informing the

ICAAP and ILAAP, and noted that business

performance risk remained stable with no

material adverse trends identified.

Market risk

The Committee reviewed market risk exposures

against approved limits and risk appetite through

established governance forums and concluded that

market risk remained stable and appropriately

managed throughout the reporting period.

People risk

The Committee provided oversight and challenge

on people risk, with particular focus on the cultural

and colleague wellbeing impacts of the Group’s

turnaround and transformation activities. The

Committee considered risks relating to colleague

engagement, attrition and burnout and the

potential implications for delivery, resilience

andcontrol effectiveness.

Customer risk

The Chief Operating Officer is a standing

attendee at each regular Committee meeting,

supporting effective oversight of customer risk.

During the year, the Committee scrutinised

quarterly complaints reporting, with particular

focus on historically elevated volumes of

responsible lending complaints originating from

claims management companies. The Committee

noted a reduction in this risk following the

introduction of Financial Ombudsman Service

referral fees.

The Committee challenged the quality and

sufficiency of complaints management

information to ensure it enabled effective

oversight of customer outcomes in line with

Consumer Duty expectations. Other areas of

focus included the potential implications of the

Supreme Court judgment on Vehicle Finance

commissions and the adequacy of complaints

handling arrangements operated by offshore

service partners.

Regulatory risk

The Committee received an update from the

Compliance Director and Data Protection Officer.

The Committee oversaw the Group’s regulatory

engagement, liaison and consultation activity,

including into the FCA’s proposed Vehicle Finance

commission disclosures compensation scheme.

TheCommittee recommended the SMCR Map

tothe Board for approval, supporting clear

accountability and regulatory compliance.

Risk Committee Report continued

Material control definition: An internal control that is critical for managing risks to our

business model, future performance, future solvency, liquidity or reputation.

The Group has defined nine material controlcategories:

Model

governance and

oversight

Financial

stability and

planning

Market risk and

asset liability

management

Operational

resilience and

outsourcing

Technology and

cyber risk

management

Financial crime

and AML

governance and

oversight

Credit risk

management

Regulatory

compliance and

reporting

Customer

andconduct

governance and

oversight

Risk management and internal

controlframework

The Committee supports the Board to assess

theGroup’s overall risk profile and considers

risks that may impact the Group’s strategy and

operations. The risk management and internal

control framework (RM&ICF) defines how risk

ismanaged across the Group and facilitates

consistent management of risk. The Committee

has overseen the annual review of the Group’s

RM&ICF which assessed its effectiveness. The

Committee has also received an assessment of

the Group’s maturity against the fundamental

components of an effective risk function to

enable pro-active risk management and

informed decision making. Based on the work

undertaken during the year, the Committee is

satisfied that the Group’s RM&ICF is robust,

proportionate, and operating effectively.

The Committee supports the Board to ensure

principal and emerging risks are identified and

adequately assessed. The Committee received

regular principal risk assessments during the

period which included a current assessment of

each risk, trajectory, and its projected outlook.

The CRO provides an opinion of the overall

riskprofile at each regular meeting, and the

Committee has considered any areas of

heightened risk. The Committee oversaw the

introduction of an emerging risks radar which has

helped assess the Group’s risk exposure, including

proximity and velocity of emerging risks. The

Committee is satisfied that the RM&ICF provides

assurance that principal and emerging risks are

being identified, assessed and managed.

94 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Material controls

The Committee directed and monitored the

programme of work to identify and assess the

effectiveness of the Group’s material controls in

response to Provision 29 of the UK Corporate

Governance Code 2024. The Committee received

and challenged updates on material controls at

each regular meeting; a timeline of the Committee’s

work is set out below. The Committee oversaw

thematerial control identification exercise, which

commenced in November 2024, and scrutinised

theassessment criteria to ensure that material

controls were comprehensively and appropriately

identified and mapped to the Group’s principal

risks and Level 1 risks.

In conjunction with the Audit Committee, the

Committee commissioned a third-line review of the

material control work. The review concluded that

the work to identify material controls had been

completed in a reliable and consistent manner,

providing assurance over the robustness of the

approach taken. The Committee will continue to

oversee the ongoing testing, monitoring and

enhancement of material controls to ensure their

effectiveness as the Group’s risk profile and

operating environment evolves.

Effectiveness of material controls

The Committee has prepared for the Board

attestation regarding the effectiveness of

material controls, required under Provision 29 of

the UK Corporate Governance Code 2024, from

FY26. The effectiveness of all material controls

and their supporting key controls was assessed

by the second-line assurance function, with

consideration given to both design and

operating effectiveness. The results of these

assessments were reported to the Committee,

together with any actions arising and associated

delivery dates. The work has positioned the

Group well in advance of reporting next year.

Committee priorities for 2026

Looking ahead, the Committee will continue to

support the Board in overseeing the effective

management of principal and emerging risks

asthe Group progresses through its next phase

of delivery and transformation.

Particular focus will remain on the continued

embedding of the risk management and internal

control framework, the ongoing effectiveness of

material controls, the completion of the Gateway

programme, and maintaining resilience in a

dynamic regulatory, technological and economic

environment, while also strengthening oversight

of emerging and cross-cutting risks, including the

responsible adoption of Artificial Intelligence.

Through continued emphasis on strong risk

culture, clear accountability, proactive horizon

scanning and a continuous improvement

mindset, the Committee will ensure that the

Group’s risk and control arrangements continue

to evolve in line with its strategy and operating

environment, supporting sustainable outcomes

for customers, colleagues and shareholders.

Michele Greene

Risk Committee Chair

25 February 2026

Risk Committee Report continued

Committee material control assessment timeline

Date November 2024 January 2025 May 2025 July 2025 September 2025 November 2025

Committee

activity

Considered the definition of

a material control, material

control assessment criteria

and mapping of controls to

principal risks.

Reviewed and approved

first-line assessment of

material controls,

commissioning second-

andthird-line reviews.

Ensured integration of

material controls into the risk

adjustment framework to

support cultural alignment.

Oversaw the addition of one

more material control and

received a progress update

regarding the second- and

third-line material control

assurance work. Noted the

use of the Group’s risk

management system to track

material and key control

assessments and actions.

Scrutinised the output from

the second-line assurance

work, noting actions arising

and associated delivery dates.

Approved the integrated

assurance plan for 2H25

ensuring it had been

appropriately mapped to the

Group’s risk taxonomy.

Received a further progress

update on the second-line

assurance work and the

status of material control

assessments. The Committee

confirmed that both the

design and execution of

controls were being assessed.

Received a deep-dive report

into a specific material control

area to oversee the process

undertaken by first-line

following on from the

second-line material control

assessment. Critiqued a draft

of the Board’s material

controls attestation.

Committee priorities in 2026 are:

5 oversight of the Credit Risk

Enhancement programme;

5 Gateway programme delivery and

legacy IT risk reduction;

5 collections and recoveries strategy;

5 embedding of the Group’s risk culture;

5 oversight of the effectiveness of the

Group’s material controls; and

5 emerging risks including AI.

95 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Shareholder informationFinancial statementsStrategic report

Directors’ Remuneration Report

Committee members (attendance)

Graham Lindsay (Chair) (3/3 plus 1/1 ad hoc)

Oliver Laird (3/3 plus 1/1 ad hoc)

Jackie Noakes

(joined February 2025)

(2/2 plus 1/1 ad hoc)

Karen Briggs

(stepped down January 2025)

(1/1)

Role of the Committee

The Chairman, the Group Chief Executive

Officer (CEO), Chief Finance Officer (CFO),

the Chief People Officer, the Head of Reward

and the Committee’s independent advisor

(PwC) attend Committee meetings by

invitation. No person is in attendance when

their own remuneration is being discussed.

The report complies with the provisions of the

Companies Act, the Large and Medium-sized

Companies and Groups (Accounts and

Reports) Regulations 2008 and the Listing

Rules of the FCA. The Company also follows

the requirements of the UK Corporate

Governance Code (the Code) updated in

January 2024.

Annual Statement by the Chair of

the Remuneration Committee

Dear shareholder

On behalf of the Remuneration Committee

(theCommittee), I am delighted to present the

Directors’ Remuneration Report for the year

ended 31 December 2025. I would like to extend

my thanks to Karen Briggs, who stepped down

from the Committee on 29 January 2025. I was

delighted to welcome Jackie Noakes as a new

Committee member from 1 February 2025. The

report sets out how the Committee carried out

its responsibilities during the year and our

approach to remuneration in 2025 and explains

the rationale for our decision making.

2025 Group performance

2025 was a defining year for Vanquis – a year

of strategic clarity, transformation and

continuing progress in repositioning the business

for sustainable, profitable growth.

Our financial performance at the end of the

year in key metrics was as follows:

5 Profit before tax (PBT) incl discontinued

operations of £9.2m (2024: Loss before

tax£136.3m);

5 Return on Tangible Equity (ROTE)of 2.3%

(2024: (32.1%)); and

5 cost-income ratio (C:I) of 58.4%

(2024:89.4%).

For full financial details please refer to pages 44 to 51

Wider workforce pay during 2025

Whilst remaining cognisant of the challenges

that the Group continued to face through the

year and on the back of a difficult year in

2024,the Committee has been mindful of the

need to retain and motivate our wider staff

population for the future stability of the business.

Our pay review in early 2025 focused on our

lower paid colleagues and a number of

initiatives were implemented:

5 an overall pay budget of 3% for salary

increases effective 1 January 2025;

5 average increases of over 4.2% for

colleagues who were in roles at the lower

levels and relatively lower paid; and

5 no increase for the executive directors

orthenon-executive directors.

In 2026, we intend to continue our focus on our

colleagues who are employed at the lower

levels, and from April 2026, the minimum full-time

salary will be £28,000. We have updated our

minimum salary (above the Living Wage for all)

by level (and location) and actively distribute a

larger percentage of our salary review pool to

those colleagues.

In 2025, the Committee

remained focused on

aligning executive

remuneration with Company

performance as the

business repositioned

forsustainable,

profitablegrowth.”

Graham Lindsay

Remuneration Committee Chair

The Committee’s terms of reference

detailing the responsibilities are available

at: https://www.vanquis.com/investors

Remuneration governance 27%

Annual bonus 27%

Share plans 26%

Risk 20%

Allocation

of time

96 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Directors’ Remuneration Report continued

2025 Group bonus pool

The financial elements of the annual bonus

scheme comprised statutory PBT, statutory ROTE

and cost-income ratio and the non-financial

elements comprised of Strategy, Customer and

People measures. The threshold on the financial

elements was achieved, permitting a payout.

Both the risk overlay and Tier 1 capital ratio

were assessed as satisfactory. On this basis, the

formulaic outcome of the annual bonus was

78.3% of maximum (2024: 24.1% of maximum,

reduced to nil following application

ofdiscretion).

In determining the final bonus outcome, the

Committee acknowledged that 2025 marked

animportant milestone in laying the foundations

for sustainable, profitable growth, but that the

transformation of the business and delivery of

the Group’s longer term strategic and returns

targets remain in progress. The Committee was

minded to reflect this in bonus outcomes for

2025 and therefore exercised its discretion to

apply a downward adjustment to the formulaic

bonus payouts for the executive directors. The

adjustment reduced the payout to 25% of the

maximum opportunity, consistent with the

approach applied for all colleagues. We have

set out in more detail the annual bonus results

for 2025 on pages 111 and 112.

Executive director remuneration

in2025

Given the 2025 financial results of the Group, the

focus of the Committee was to ensure that this

was appropriately reflected in the remuneration

decisions made, and outcomes were aligned to

the wider stakeholder experience.

RSP 2025 award grant

As reported in last year’s report, in light of the

performance delivered in 2024 and the Group’s

financial position, the Committee decided not

make any RSP awards in April 2025 but reserved

the right to reconsider this decision following the

announcements of the 2025 half-year results,

taking into consideration the Group’s financial

performance in the first half of 2025 as well as

the shareholder experience.

At the half year, the Committee conducted a

detailed assessment of the Group’s performance

and noted the improvement in financial

performance of the business in the first half of

2025, as the Group returned to profit, with growth

in customer balances and return to robust

interest margins. There was also strong growth

inthe company share price, which more than

doubled in the first six months of the year.

Against this backdrop, the Committee determined

that it would be appropriate to award the full

RSP grant in September 2025 in line with the

Policy. No adjustment was determined to be

necessary for any potential windfall gains at the

time of grant. As per our internal Policy, a further

assessment on windfall gains will be carried out

at vest as per the RSP underpin requirements.

Further details are shared on page 112 and 113.

RSP 2022 award vesting

Prior to vesting in April 2025, the Committee

reviewed the interim assessment disclosed in last

year’s report and remained of the view that the

proposed level of downwards adjustment of

12.8% was appropriate. Further details are

shared on page 113.

RSP 2023 award vesting

The RSP 2023 awards granted to the previous

CEO and CFO (Malcolm Le May and Neeraj

Kapur) are scheduled to vest on 11 April 2026

and the RSP award granted to our CEO on

appointment on 8 September 2023 will vest

on8September 2026. As for the 2022 RSP, the

Committee reviewed performance against the

underpin over each of the three years of the

performance period. With respect to performance

year 2023 and 2025, the Committee was satisfied

that the underpin was met. With respect to

performance year 2024, as disclosed last year,

the Committee concluded that a total downwards

adjustment of 30% should be applied equally

across the three RSP awards (RSP 2022, RSP

2023 and RSP 2024) and hence a 10%

downwards adjustment will be applied

totheRSP 2023 award.

In addition, the Committee carried out an

assessment of dividend equivalents applied to

this award vesting in April 2026 and determined

that an additional downwards reduction of 9.1%

should be made to the vesting outcomes to

reflect the actual dividends paid over the vesting

period as compared to those anticipated when

granted. The initial dividend equivalent adjustment

for the award vesting in September 2026 is 26.2%.

Any final change to this adjustment will be

disclosed in the 2026 Directors’ Remuneration

Report. Further details are shared on page 113

and 114.

Deferred Bonus Plan (DBP) 2023

The Committee carried out an assessment of

dividend equivalents applied to the DBP 2023

award (which is due to vest on 11 April 2026) and

determined that a downwards reduction of 9.1%

should be made to the vesting outcomes of the

previous CEO and CFO. Further details are

shared on page 114.

Single Figure of Remuneration

In 2025, the CEO’s total single figure of

remuneration was £1,875k (2024: £910k)

reflecting the outcome of the 2025 annual bonus

and the 2023 RSP. The CFO’s was £789k (2024:

£616k) reflecting the outcome of the 2025 annual

bonus.

Annual Statement by the Chair of the Remuneration Committee continued

97 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Directors’ Remuneration Report continued

Directors’ Remuneration Policy

(thePolicy) in 2026

The current Directors’ Remuneration Policy

(“Policy”) was renewed at the May 2023 AGM,

with minor amendments to align to market and

regulatory expectations, whilst retaining the

broader structure and no proposed changes

toquantum. The Policy received strong support

from shareholders with 94.8% votes in favour

and operated as intended with continued

support from shareholders reflected in the

voting outcomes (over 97% votes in favour) for

the Directors’ Remuneration Report in each of

the last two years.

During 2025, as a part of the three year renewal

cycle, the Committee carried out a detailed

review of the Policy to ensure that it continues

tosupport the Group’s strategy as well as the

attraction, retention, and motivation of key

executive talent, while remaining responsive

toevolving regulatory requirements and best

practices across the financial services sector.

The Committee concluded that the current Policy,

which includes a market standard bonus and

aRestricted Share Plan (RSP), remains fit for

purpose. It is therefore proposed to retain the

overall structure under the Policy with two minor

amends to align with emerging practice and

provide clarity over the implementation of the

Policy going forward.

5 Removal of the Role Based Allowance (RBA):

The RBA was introduced in 2020 in line with

the approach taken by UK banks at that

time to remain competitive in response to

the 2:1 bonus cap. The only recipient of the

RBA under the Policy was the previous CEO,

who left the business in January 2024. The

current CEO and CFO have not received an

RBA in any year since their appointments.

Given that the RBA is not in use, the

Committee proposes to remove it from the

Policy in order to simplify the structure. This

approach also aligns with emerging practice

in the wider sector, as a number of banks

who were previously subject to the 2:1 cap

are removing the RBA element, as a part of

rebalancing their fixed and variable pay

following the removal of the bonus cap by

the UK regulators.

5 Clarification of target payout under

AnnualBonus Plan: As disclosed in our

Remuneration Reports, over this Policy cycle

the annual bonus has been calibrated such

that achievement of ‘on target’ performance

results in a payout of 60% of maximum. For

clarity, the Policy wording will be updated to

reflect the fact that the Committee intends

to continue with this approach over the next

three-year cycle.

In carrying out this review, we wrote to our

major shareholders and main shareholder

representative bodies on the specifics of our

proposals, to understand their perspectives

andto factor those into our proposed Policy

changes. The time shareholders took to review

our proposals and share their views was greatly

appreciated. The feedback was positive and

therefore no changes were made to the original

proposals. I hope that shareholders will

therefore be supportive of these minor changes

to the Policy at the AGM to ensure that it

operates effectively.

Implementation of the Policy in 2026

2026 salary increases

For the 2025 financial year, the Committee has

agreed to apply 1.5% salary increases to the

CEO and CFO. These increases are effective 1st

April and are below the average increase of

2.5% awarded to the wider workforce and are

the first increases awarded since they joined

Vanquis in 2023.

2026 annual bonus

There are no changes to the annual bonus

opportunity which is 150% of base salary

and125% of salary for the CEO and CFO

respectively, in line with our Policy.

5 statutory PBT (25%), statutory ROTE (25%),

and cost-income ratio (10%); and

5 non-financial metrics (40%).

The metrics within the non-financial scorecard

will continue to align with our strategic priorities.

RSP 2026 grant

After considering 2025 performance, RSP awards

of 100% and 75% of base salary will be granted

to the CEO and CFO respectively – in line with

our Policy. Subject to underpin criteria, as set

outin our Policy, awards will vest in three years

with an additional retention period of two years

after vesting.

2026 non-executive director (NED) fees

As reported last year, the NEDs took a

significant reduction in their fees from 2024 and

NED base fees remained flat in 2025. During the

year, fees for the Senior Independent Director

were reviewed and increased from £15,000 to

£25,000, effective from 29 January 2025. A

further review of all fees was undertaken and

the Committee (for the Chairman) and the Board

(for the NEDs) determined that there would be

no other changes to the fees for 2026

Conclusion

We recognise that it’s been another challenging

year for the business. The Committee believes

that the decisions made appropriately reflect

the shareholder experience over the course of

the year. In the rest of this report, we present

thedisclosures required by regulations, as

wellas additional information to explain how

our executive remuneration aligns with our

strategy, our shareholder interests and with

ourwider workforce.

I sincerely thank our colleagues for their hard

work throughout the year and our shareholders

for their continued support. I will be available

atthe Company’s 2026 AGM to answer any

questions in relation to this Remuneration Report.

Graham Lindsay

Remuneration Committee Chair

25 February 2026

Annual Statement by the Chair of the Remuneration Committee continued

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Directors’ Remuneration Report continued

Remuneration at a glance

The following section sets out:

5 an illustration of the operation of the Policy for 2026;

5 a summary of the executive directors’ single total

remuneration figures, and outcomes under the 2025

Annual Bonus Plan and the RSP 2023 award; and

5 an overview of executive directors’ shareholdings.

Full details of the Policy can be found under the Shareholder Hub

section of our website.

Illustration of the Policy in 2026

Restricted Share Plan

CEO – 100% of salary

CFO – 75% of salary

Restricted

Salary,

pension,

benefits

paid

vest after

3 years

Vested

released

after

2 years

+1 +2 +3 +4 +5 +6

Minimum shareholding of 200% of salary

Vesting period

subject to continued

employment and underpin

2-year holding

period

(EDs only)

1/3 vest

Deferred

bonus

At least

40%

Cash

bonus

60%

Part of the bonus is

deferred into sharesvesting

pro-rata over3 years

(no performance conditions)

Annual bonus

CEO – 150% of salary

CFO – 125% of salary

Fixed remuneration

Year 0

(performance

year)

Salary: 1st April Salary increase of 1.5%.

5 CEO: Ian McLaughlin: £736,000 (2025: £725,000).

5 CFO: Dave Watts: £558,000 (2025: £550,000).

Pension: No change from 2025.

5 All EDs: cash payment of 10% of salary (in line with the wider workforce).

Benefits: Removal of temporary travel allowance, no other change from 2025.

5 All EDs: Car allowance £10,000 (2025: £10,000). Eligible for life assurance, private medical insurance and permanent health insurance (no change).

5 Transitionary temporary travel allowance on joining, for Ian McLaughlin only of £100,000 per annum will no longer be operated (and expired

on 26 July 2025).

Annual bonus:

5 Maximum opportunity:

5 CEO: 150% of salary.

5 CFO: 125% of salary.

5 Performance measures:

5 60% financial:

5 statutory PBT 25% (2025: 25%);

5 statutory ROTE 25% (2025: 25%); and

5 cost-income ratio 10% (2025: 10%).

5 40% non-financial will align to the 2026 strategy (Customer & Colleague) and will be disclosed in the 2026 Directors’ Remuneration Report.

5 Risk overlay and Tier 1 capital ratio underpin.

5 Deferral: At least 40% deferred, vesting pro-rata over three years in company shares.

RSP:

5 Award level:

5 CEO: Maximum 100% of base salary.

5 CFO: Maximum 75% of base salary.

5 As a part of grant process, the Committee will consider individuals’ personal and business performance for the prior year and determine

whether the proposed level ofgrant remains appropriate.

5 Underpins: The Committee will consider the following factors (amongst others) when determining whether to exercise its discretion to adjust

thenumber of shares vesting:

5 whether threshold performance levels have been achieved for the performance conditions for the Annual Bonus Plan for each of the three

years covered by the vesting period;

5 the underlying financial performance progression over the vesting period;

5 whether there have been any sanctions or fines issued by a Regulatory Body (participant responsibility may be allocated collectively

orindividually);

5 whether there has been material damage to the reputation of the Company (participant responsibility may be allocated collectively

orindividually);

5 the potential for windfall gains;

5 the level of colleague and customer engagement over the vesting period; and

5 the level of achievement of our approach to ESG as set out by the Board.

5 Vesting: Three years with a two-year holding period post-vesting.

Shareholding requirement:

5 CEO/CFO: 200% of salary.

5 Full requirement to be held for two years post-cessation.

Further details on the implementation of the Policy, have been set out later in this report under the ‘Directors’ Remuneration Policy in

2026’ section on pages 100 and 108.

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Remuneration at a glance continued

Executive director 2025 remuneration outcomes

The charts below show an estimate of the remuneration that could be received by executive

directors under the Policy and how our performance has flowed through to the remuneration

provided to our executive directors. The full explanatory notes for each element of

remuneration are detailed on pages 100 to 107 in the Annual Report on Remuneration.

Remuneration (£’000)

Ian McLaughlin, CEO

Minimum

810

653

725

On target

2,188

363

810

1,088

725

Maximum

2,986

867

Single figure

2025

2,3

1,875

910

Single figure

2024

910

Dave Watts, CFO

Minimum

617

413

On target

1,443

206

617

688

413

Maximum

1,924

617

Single figure

2025

2,3

789

616

Single figure

2024

616

Fixed

Annual bonus

RSP

Share price

1 Single figure for 2024 pro-rated to time served as

executive director.

2 No bonus has been paid for 2024, see pages 111 to 112

for details of the 2025 bonus.

3 CEO and CFO joined in 2023, therefore no RSP

hasvested.

Directors’ Remuneration Report continued

Assumptions

5 Minimum pay is fixed pay only, i.e.

salary+benefits + pension (excluding

travel allowance).

5 On-target pay includes fixed pay (excluding

travel allowance), 60% of the maximum

bonus (with maximum equal to 150% of

salary for the CEO and 125% for the CFO)

and 100% vesting of the RSP awards (with

grant levels of 100% of salary for the CEO

and 75% for CFO).

5 Maximum pay includes fixed pay (excluding

travel allowance) and assumes 100%

vesting of both the annual bonus and the

RSP awards.

5 The illustration of ‘maximum’ assumes a

50% share price increase on the RSP award

over the vesting period and is shown as

‘share price’.

5 All amounts have been rounded to the

nearest £1,000.

2025 annual bonus outcome

The table below summarises performance against the targets set for the 2025 bonus and the

outcome, before and after Committee discretion.

Outcome

Threshold Target Maximum CEO CFO

75% 100% 125% Actual Weighting (IM) (DW)

Financial targets 60% 47.8% 47.8%

Statutory PBT £6.6m £8.8m £11.0m £9.2m 25% 16.8% 16.8%

Statutory ROTE 1.3% 1.7% 2.1% 2.3% 25% 25% 25%

Cost-income ratio 61.9% 58.4% 54.9% 58.4% 10% 6% 6%

Non-financial metrics 40% 30.5% 30.5%

Risk overlay Met Met

Tier 1 ratio The Group achieved a Tier 1 capital ratio of 19.3%

Scorecard outcome (as a % of maximum bonus) 78.3% 78.3%

Final outcome (as a % of maximum bonus) after Committee discretion 25% 25%

Link between remuneration and equity of the executive directors

We believe that equity has an important part to play in the remuneration of the executive directors.

There is a need for the executive directors to understand from first-hand experience the position of

the shareholders and our RSP (and deferred bonus schemes) are structured to support that

understanding. We monitor regularly that the directors are on track to meet their obligations under

the Share Ownership Policy, and we confirm, although they are early in tenure, that the current CFO

and CEO are both currently on track. To ensure that our executive directors are incentivised to take a

long-term, sustainable view of the performance of the Company, when we look at the remuneration

paid in the year, we also look at the total equity they hold, and its value based on the performance

of the Company.

The table below sets out the number of shares beneficially owned and unvested share options

subject to performance awarded to the executive directors at the beginning and end of the financial

year, and the impact on the value of these shares taking the opening and closing price for the year.

Value of Value of

2025 Shares Shares shares at shares at

single held at held at the start of the end of

figure the start the end the year

the year

Difference

£’000

of the year of the year

£’000 £’000 £’000

CEO (Ian McLaughlin) 1,875 1,895,865 2,541,802 843.7 3,040.0 2,196.3

CFO (Dave Watts) 789 704,893 1,115,298 313.7 1,333.9 1,020.2

1 Based on amount shown in the single figure of remuneration table.

2 Based on a closing share price on 29 December 2024 of £0.445.

3 Based on a closing share price on 31 December 2025 of £1.196.

4 Shares held at the end of the year include both shares owned outright and unvested share options subject to performance

(numberof shares at grant) see page 114.

272

172

736

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Directors’ Remuneration Report continued

The section sets out the proposed Vanquis Banking Group Directors’ Remuneration Policy, (the ‘Policy’), which will apply for a period of threeyears beginning the date of the 6 May 2026 AGM, subject to

shareholder approval. A copy of this policy can be reviewed in the Vanquis Banking Group plc Annual Report and financial statements 2025 (pages 100 to 108) as found on ourwebsite.

Changes made to the Policy since the 2023 shareholder vote

The current Directors’ Remuneration Policy for executive directors, the Chairman and independent non-executive directors was approved at the AGM held on 25 May 2023 and received the support of 94.8%

ofshareholders.

The Committee conducted a review of the Policy in 2025 considering the views of stakeholders, the strategic objectives of the Group, the remuneration framework applicable to all colleagues, as well as

market practice, regulatory and corporate governance developments.

Following careful consideration, the Committee decided to retain a broadly unchanged Policy, with some minor changes in order to align with market practice and reinforce sustained long-term focus on our

strategic goals. The proposed changes include removal of the Role Based Allowance (RBA) and amendment of the target payout under the annual bonus from 50% to 60% of maximum. Further details of the

rationale for changes, including consideration of shareholder views, can be found on page 97 of this report. The Committee believes that the proposed Policy will continue to support the delivery of the

Group’s business strategy and alignment to the interests of our shareholders.

Remuneration Policy – executive directors

Element and link to strategy Operation Maximum

Performance conditions

andrecovery provisions

Salary

Provides a base level of

remuneration to support

recruitment and retention of

executive directors with the

necessary experience and

expertise todeliver the

Group’sstrategy.

An executive director’s salary is set on appointment and reviewed annually

or when there is a change in position or responsibility.

When determining an appropriate level of salary, the Committee considers

a broad assessment of individual and business performance including:

5 pay increases for other colleagues;

5 remuneration practices within the Group;

5 any change in scope, role and responsibilities;

5 the general performance of the Group and each individual;

5 the experience of the relevant director; and

5 the economic environment.

Individuals who are recruited or promoted to the Board may, on occasion,

have their salaries set below the targeted Policy level until they become

established in their role. In such cases, subsequent increases in salary may

be higher than the general rises for colleagues until the target positioning

isachieved.

There is no set maximum increase; however, any increases will normally be

nohigher than the increase awarded to the overall colleague population.

A greater salary increase may be appropriate in certain circumstances, such

asa new appointment made on a salary below a market-competitive level,

where phased increases are planned, or where there has been an increase in

theresponsibilities of an individual. Where increases are awarded in excess

ofthe wider colleague population, the Committee will provide an explanation

inthe relevant Annual Report on Remuneration.

The Committee ensures that maximum salary levels are positioned in line with

companies of a similar size to Vanquis Banking Group and validated against an

appropriate comparator group, so that they are competitive against the market.

The Committee intends to review the comparators each year and will add or

remove companies from the groups as it considers appropriate. In general, salary

increases for executive directors will be in line with the increase for colleagues.

However, larger increases may be offered if there is a material change in the

sizeand responsibilities of the role (which covers significant changes in Group

size and/or complexity). The Company will set out, in the section headed

Implementation of Directors’ Remuneration Policy, in the following financial year,

the salaries for that year for each of the executive directors.

No recovery provisions apply.

Pension

Provides a fair level of pension

provision for all colleagues.

The Company provides a pension contribution allowance that is fair,

competitive and in line with corporate governance best practice.

Pension contributions will be a non-consolidated allowance and will not

impact any incentive calculations.

The maximum value of the pension contribution allowance for executive directors

will be aligned to that of the wider workforce (currently 10% of salary per annum).

Where there is any change to this rate then the executive directors will be

entitled to receive the same contribution, or cash equivalent payment, which,

forthe avoidance of doubt, could be more than 10% of salary.

The Company will set out in the section headed Implementation of Remuneration

Policy, in the following financial year, the pension contributions for that year for

each of the executive directors.

No performance or recovery

provisions applicable.

Vanquis Banking Group plc Directors’ Remuneration Policy 2026 to 2029

101 – Vanquis Banking Group plc Annual Report and Accounts 2025

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Directors’ Remuneration Report continued

Remuneration Policy – executive directors continued

Element and link to strategy Operation Maximum Performance conditions andrecovery provisions

Benefits

Provides a market standard

levelof benefits.

Benefits include market standard benefits.

The Committee recognises the need to maintain suitable

flexibility in the benefits provided to ensure it is able to

support the objective of attracting and retaining

personnel in order to deliver the Group strategy.

Additional benefits that are available to other

colleagues on broadly similar terms may therefore be

offered such as relocation allowances on recruitment.

The maximum is the cost of providing the relevant

benefits which includes pension allowance, car

allowance, life assurance, permanent health insurance

and medical insurance.

No performance or recovery provisions applicable.

Annual Bonus Plan

The Annual Bonus Plan provides

a significant incentive to the

executive directors linked to

achievement in delivering goals

that are closely aligned with

theCompany’s strategy

andthecreation of value

forshareholders.

In particular, the Annual Bonus

Plan supports the Company’s

objectives allowing the setting

ofannual targets based on the

business strategic objectives at

that time, meaning that a wider

range of performance metrics

can be used that are relevant

and achievable.

Annual bonuses are discretionary and the Committee

willdetermine the maximum annual participation in the

Annual Bonus Plan for each year based on a mix of

financial and other strategic measures.

Details of the performance measures, targets and their

level of satisfaction for the year being reported on will

be set out in the Annual Report on Remuneration.

The Committee can determine that part of the bonus

earned under the Annual Bonus Plan is provided as an

award of shares under the Deferred Share Bonus Plan

(DBP) element.

The minimum level of deferral is 40% of the bonus;

however, the Committee may determine that a greater

portion or in some cases the entire bonus be paid in

deferred shares.

The main terms of these awards are:

5 minimum deferral period of three years;

5 deferred bonus will vest in equal amounts over the

three-year period; and

5 the participant’s continued employment at the end

of the deferral period unless he/she is a good leaver.

Where regulations prevent the payment of dividend

equivalents over the vesting period, the number of

shares awarded will be calculated by reference to a

discounted share price reflecting the lack of entitlement

to dividends or dividend equivalents. In such

circumstances, the Committee has discretion to reduce

(not increase) the number of shares that vest if actual

dividends paid over the period are materially lower than

the original dividend assumption.

The maximum Annual Bonus opportunity for each

year will not exceed 150% of salary.

Percentages of bonus maximum typically earned for

different levels of performance are:

5 minimum: 0%;

5 threshold: up to 25%;

5 target: 60%; and

5 maximum: 100%.

The Annual Bonus Plan is based on a mix of financial and strategic/operational

conditions and is measured over a period of one financial year. The financial

measures will account for no less than 50% of the bonus opportunity.

The Company will set out in the section headed ‘implementation of the Directors’

Remuneration Policy’, in the following financial year, the nature of the targets

andtheir weighting for each year.

The Committee retains discretion in exceptional circumstances to change

performance measures and targets and the weightings attached to performance

measures part-way through a performance year if there is a significant and

material event that causes the Committee to believe the original measures,

weightings and targets are no longer appropriate.

Discretion may also be exercised in cases where the Committee believes that

thebonus outcome is not a fair and accurate reflection of business, individual

andwider Company performance. The exercise of this discretion may result in a

downward or upward movement in the amount of bonus earned resulting from

theapplication of the performance measures.

Any adjustments or discretion applied by the Committee will be fully disclosed

inthe following year’s Remuneration Report.

The Committee is of the opinion that given the commercial sensitivity arising in

relation to the detailed financial targets used for the annual bonus, disclosing

precise targets for the Annual Bonus Plan in advance would not be in shareholder

interests. Actual targets, performance achieved and awards made will be published

at the end of the performance periods so shareholders can fully assess the basis

for any pay-outs under the annual bonus.

Both the Annual Bonus Plan and the DBP contain malus provisions. In addition,

theAnnual Bonus Plan contains clawback provisions. Further detail is set out in the

Malus and clawback table on page 103.

Vanquis Banking Group plc Directors’ Remuneration Policy 2026 to 2029 continued

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Directors’ Remuneration Report continued

Remuneration Policy – executive directors continued

Element and link to strategy Operation Maximum Performance conditions andrecovery provisions

Restricted Share Plan (RSP)

Awards are designed to

incentivise the executive directors

over the longer term to

successfully implement the

Company’s strategy.

Awards are granted annually to executive directors in

the form of conditional awards or options.

Awards vest at the end of a three-year period subject to:

5 the executive director’s continued employment

atthedate of vesting; and

5 the satisfaction of an underpin as determined

bytheCommittee whereby the Committee can

adjustvesting for business, individual and wider

Companyperformance.

A two-year holding period will apply following the

three-year vesting period for all awards granted to the

executive directors.

Upon vesting, sufficient shares may be sold to pay tax

on the shares.

Where regulations prevent the payment of dividend

equivalents over the vesting period, the number of shares

awarded will be calculated by reference to a discounted

share price reflecting the lack of entitlement to dividends or

dividend equivalents. In such circumstances, the Committee

has discretion to reduce (not increase) the number of shares

that vest if actual dividends paid over the period are

materially lower than the original dividend assumption.

Authority is given for the Committee to make minor

amendments to the Restricted Share Plan to ensure

compliance with any regulatory changes the Company

may become subject to over the life of the Policy.

The maximum value of RSP awards is 100% of salary

per annum based on the market value at the date of

grant set in accordance with the rules of the RSP.

There are no performance conditions on grant;

however, the Remuneration Committee will consider

prior year business and personal performance

todetermine whether the level of grant

remainsappropriate.

No specific performance conditions are required for the vesting of restricted shares,

but there will be an underpin as the Committee will have the discretion to adjust

vesting, taking into account business, individual and wider Company performance.

The Committee will take into account the following factors (amongst others)

whendetermining whether to exercise its discretion to adjust the number of

sharesvesting:

5 whether threshold performance levels have been achieved for the

performance conditions for the Annual Bonus Plan for each of the three years

covered by the vesting period for the restricted shares;

5 whether there have been any sanctions or fines issued by a regulatory body,

participant responsibility may be allocated collectively or individually;

5 whether there has been material damage to the reputation of the Company,

participant responsibility may be allocated collectively or individually;

5 the potential for windfall gains;

5 the level of colleague and customer engagement over the period; and

5 the level of achievement of our approach to ESG as set out by the Board.

The Committee retains discretion to change the factors being considered.

Awards are subject to clawback and malus provisions. Further detail is set out in

the Malus and clawback table below.

The Committee will operate the Bonus Plan and the RSP within the Policy detailed above and in accordance with their respective rules. In relation to the discretions included within the Plan rules, these include,

but are not limited to: (i) who participates in the Plans; (ii) testing of the relevant performance targets; (iii) undertaking an annual review of performance targets and weightings; (iv) the determination of the

treatment of leavers in line with the Plan rules; (v) adjustments to existing performance targets and/or share awards under the Plans if certain relevant events take place (e.g. a capital restructuring, a

material acquisition/divestment, etc.) with any such adjustments to result in the revised targets being no more or less challenging to achieve; and (vi) dealing with a change of control.

In addition to the operational discretions that the Committee can exercise in the performance of its duties (including those set out in the Plan rules), the Committee reserves the right to make either minor or

administrative amendments to the Policy to benefit its operation or to make more material amendments in order to comply with new laws, regulations and/or regulatory guidance. The Committee would only

exercise this right if it believed it was in the best interests of the Company to do so and where it is not possible, practicable or proportionate to seek or await shareholder approval in a General Meeting.

Legacy remuneration arrangements

This Policy permits honouring any commitments with current or former directors entered into prior to the approval and implementation of the Policy (such as the grandfathering of past deferred remuneration

awards), provided that such commitments complied with any applicable Remuneration Policy in effect at the time they were entered into. Authority is also given to honour arrangements agreed with an

employee prior to appointment as an executive director that may have different terms or performance conditions.

Vanquis Banking Group plc Directors’ Remuneration Policy 2026 to 2029 continued

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Directors’ Remuneration Report continued

Shareholding requirement

The Committee already has in place strong shareholding requirements (as a percentage of salary) that encourages executive directors to build up their holdings over a five-year period from the date of their

appointment as executive director with a requirement of 200% of salary.

Adherence to these guidelines is a condition of continued participation in the equity incentive arrangements. This policy ensures that the interests of executive directors and those of shareholders are closely aligned.

In addition, executive directors will be required to retain 50% of the post-tax amount of vested shares from the Company incentive plans until the minimum shareholding requirement is met and maintained.

Upon stepping down, executive directors are required to hold shares of a value equal to the lower of their shareholding requirement immediately prior to departure and the actual shareholding on departure,

for a period of two years.

Malus and clawback

Malus is the adjustment of the Bonus Plan payments or unvested long-term incentive awards (including RSP awards) or the imposition of additional conditions because of the occurrence of one or more

circumstances listed below. The adjustment may result in the value being reduced to nil.

Clawback is the recovery of payments made under the Bonus Plan or vested long-term incentive awards (including RSP awards) as a result of the occurrence of one or more circumstances listed below.

Clawback may apply to all or part of a participant’s payment under the Bonus Plan or RSP award and may be affected, among other means, by requiring the transfer of shares, payment of cash or reduction

of awards or bonuses. The circumstances in which malus and clawback could apply are as follows:

5 discovery of a material misstatement resulting in an adjustment in the audited accounts of the Group or any Group company;

5 the assessment of any vesting condition or condition in respect of an award under the Plan was based on error, or inaccurate or misleading information;

5 the discovery that any information used to determine the award was based on error, or inaccurate or misleading information;

5 action or conduct of a participant that amounts to fraud or gross misconduct;

5 events or the behaviour of a participant have led to the censure of a Group company by a regulatory authority or have had a significant detrimental impact on the reputation of any Group company

provided that the Committee is satisfied that the relevant participant was responsible for the censure or reputational damage and that the censure or reputational damage is attributable to the participant;

5 failure of risk management including but not limited to a material breach of risk appetite and regulatory standards;

5 material downturn in business performance as determined by the Committee; or

5 corporate failure.

Annual bonus (cash) Annual bonus (deferred shares) Restricted shares

Malus

Up to the date of the cash payment. To the end of the three-year vesting period. To the fifth anniversary of the award date.

Clawback

Two years post the date of any cash payment.

The total malus and clawback period may be extended

totenyears where there is an ongoing internal or

regulatoryinvestigation.

Clawback applies in line with the regulations, current for

aperiod of seven years, extendable up to one year.

The total malus and clawback period may be extended

totenyears where there is an ongoing internal or

regulatoryinvestigation.

Two years following the fifth anniversary of the award date.

The total malus and clawback period may be extended to ten

years where there is an ongoing internal or regulatory investigation.

The Committee believes that the rules of the plans provide sufficient powers to enforce malus and clawback where required.

Vanquis Banking Group plc Directors’ Remuneration Policy 2026 to 2029 continued

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Directors’ Remuneration Report continued

Loss of Office Policy

When considering compensation for loss of office, the Committee will always seek to minimise the cost to the Company whilst applying the following philosophy.

Remuneration element Treatment on cessation of employment

General

The Committee will honour executive directors’ contractual entitlements. Service contracts do not contain liquidated damages clauses. If a contract is to be terminated, the Committee

willdetermine such mitigation as it considers fair and reasonable in each case. There are no contractual arrangements that would guarantee a pension with limited or no abatement

onseverance or early retirement. There is no agreement between the Company and its directors or colleagues, providing for compensation for loss of office or employment that occurs

because of a takeover bid. The Committee reserves the right to make additional payments where such payments are made in good faith in discharge of an existing legal obligation

(orbyway of damages for breach of such an obligation), or by way of settlement or compromise of any claim arising in connection with the termination of an executive director’s office

oremployment.

Salary, benefits

andpension

These will be paid over the notice period. The Company has discretion to make a lump sum payment in lieu.

Bonus cash Good leaver reason

Performance conditions will be

measured at the bonus

measurement date. Bonus will

normally be pro-rated for the

period worked during the

financial year.

Other reason

No bonus payable for the year

ofcessation.

Discretion

The Committee has discretion to determine:

5 that an executive director is a good leaver. It is the Committee’s intention to only use this discretion in

circumstances where there is an appropriate business case, which will be explained in full to shareholders; and

5 whether to pro-rate the bonus to time. The Committee’s normal policy is that it will pro-rate bonus for time.

Itis the Committee’s intention to use discretion to not pro-rate in circumstances where there is an appropriate

business case, which will be explained in full to shareholders.

Bonus deferred

shareawards

Good leaver reason

All subsisting deferred share

awards will vest.

Other reason

Lapse of any unvested deferred

shareawards.

Discretion

The Committee has discretion to:

5 determine that an executive director is a good leaver. It is the Committee’s intention to only use this discretion

in circumstances where there is an appropriate business case, which will be explained in full to shareholders;

5 vest deferred shares at the end of the original deferral period or at the date of cessation. The Committee will

make this determination depending on the type of good leaver reason resulting in the cessation; and

5 determine whether to pro-rate the maximum number of shares to the time from the date of grant to the date

of cessation. The Committee’s normal policy is that it will not pro-rate awards for time. The Committee will

determine whether or not to pro-rate based on the circumstances of the executive director’s departure.

Vanquis Banking Group plc Directors’ Remuneration Policy 2026 to 2029 continued

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Directors’ Remuneration Report continued

Remuneration element Treatment on cessation of employment

Restricted Share Plan

For the year

ofcessation

Good leaver reason

The award will normally be

pro-rated for the period worked

during the financial year.

Other reason

No award for year of cessation.

Discretion

The Committee has discretion to determine:

5 that an executive director is a good leaver. It is the Committee’s intention to only use this discretion in

circumstances where there is an appropriate business case, which will be explained in full to shareholders;

5 whether to pro-rate the Company award to time. The Committee’s normal policy is that it will pro-rate for

time. It is the Committee’s intention to use discretion to not pro-rate in circumstances where there is an

appropriate business case, which will be explained in full to shareholders; and

5 whether the awards vest on the date of cessation or the original vesting date. The Committee will make its

determination based, amongst other factors, on the reason for the cessation of employment.

Restricted Share Plan

Subsisting awards

Good leaver reason

Awards will be pro-rated to time

and will vest on their original

vesting dates and remain subject

to the holding period.

Other reason

Unvested awards will be

forfeited on cessation

ofemployment.

Vested awards will remain

subject to the holding period.

Discretion

The Committee has discretion to determine:

5 that an executive director is a good leaver. It is the Committee’s intention to only use this discretion in

circumstances where there is an appropriate business case, which will be explained in full to shareholders;

5 whether to pro-rate the award to the date of cessation. The Committee’s normal policy is that it will pro-rate.

The Committee will determine whether to pro-rate based on the circumstances of the executive director’s

departure;

5 whether the awards vest on the date of cessation or the original vesting date. The Committee will make its

determination based, amongst other factors, on the reason for the cessation of employment; and

5 whether the holding period for awards applies in part or in full. The Committee will make its determination

based, amongst other factors, on the reason for the cessation of employment.

Other contractual

obligations

There are no other contractual provisions other than those set out above agreed prior to 27 June 2012.

The following definition of leavers will apply to all the above incentive plans. A good leaver reason is defined as cessation in the following circumstances:

5 death;

5 ill health;

5 injury or disability;

5 retirement with agreement of the employing Group company;

Cessation of employment in circumstances other than those set out is cessation for otherreasons.

5 employing company ceasing to be a Group company;

5 transfer of employment to a company that is not a Group company; and

5 at the discretion of the Committee (as described above).

Loss of Office Policy continued

Vanquis Banking Group plc Directors’ Remuneration Policy 2026 to 2029 continued

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Directors’ Remuneration Report continued

Change of Control Policy

Name of incentive plan Change of control Discretion

Cash awards

Pro-rated to time and

performance to the date

of the change of control.

The Committee has discretion regarding

whether to pro-rate the bonus to time. The

Committee’s normal policy is that it will

pro-rate the bonus for time. It is the

Committee’s intention to use its discretion

to not pro-rate in circumstances only

where there is an appropriate business

case.

Deferred share awards

The number of shares

subject to subsisting

deferred share awards

will vest on a change of

control pro-rated for time

and performance against

any underpins.

The Committee has discretion regarding

whether to pro-rate the RSP awards for

time. The Committee’s normal policy is that

it will pro-rate the restricted share awards

for time. It is the Committee’s intention to

use its discretion to not pro-rate in

circumstances only where there is an

appropriate business case. The Committee

also has discretion to consider attainment

of any underpins.

Restricted shares

The number of shares

subject to subsisting RSP

awards will vest on a

change of control

prorated for time and

performance against any

underpins.

The Committee has discretion regarding

whether to pro-rate the RSP awards for

time. The Committee’s normal policy is that

it will pro-rate the restricted share awards

for time. It is the Committee’s intention to

use its discretion to not pro-rate in

circumstances only where there is an

appropriate business case. The Committee

also has discretion to consider attainment

of any underpins.

Recruitment and Promotion Policy

The Company’s principle is that the remuneration of any new recruit will be assessed in line with the

same principles as for the executive directors, as set out in the Directors’ Remuneration Policy table.

The Committee is mindful that it wishes to avoid paying more than it considers necessary to secure a

preferred candidate with the appropriate calibre and experience needed for the role. In setting the

remuneration for new recruits, the Committee will have regard to guidelines and shareholder

sentiment regarding one-off or enhanced short-term or long-term incentive payments as well as

giving consideration for the appropriateness of any performance measures associated with an

award. The Company’s policy when setting remuneration for the appointment of new directors is

summarised in the table below:

Remuneration element Recruitment Policy

Salary, benefits,

andpension

Salary, benefits, and pension can be set up to and in line with the Policy

for existing executive directors. Maximum pension contribution will be

aligned to that of the majority of colleagues.

Annual bonus

Maximum annual participation will be set in line with the Company’s

policy for existing executive directors and will not exceed 150% of salary.

Restricted shares

Maximum annual participation will be set in line with the Company’s

policy for existing executive directors and will not exceed 100% of salary

for restricted shares.

Maximum variable

remuneration

The maximum variable remuneration which may be granted is the sum

of the annual bonus and restricted shares award (excluding the value of

any buyouts). For the proposed Policy under the Restricted Share Plan,

the maximum variable remuneration will be 250% of salary.

Vanquis Banking Group plc Directors’ Remuneration Policy 2026 to 2029 continued

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Directors’ Remuneration Report continued

Remuneration element Recruitment Policy

‘Buyout’ of incentives

forfeited on cessation

of employment

Where the Committee determines that the individual circumstances of

recruitment justifies the provision of a buyout, the equivalent value of

any incentives that will be forfeited on cessation of an executive

director’s previous employment will be calculated taking into account

the following:

5 the proportion of the performance period completed on the date of

the executive director’s cessation of employment;

5 the performance conditions attached to the vesting of these

incentives and the likelihood of them being satisfied; and

5 any other terms and conditions having a material effect on their

value (‘lapsed value’).

The Committee may then grant up to the same value as the lapsed

value, where possible, under the Company’s incentive plans. To the

extent that it was not possible or practical to provide the buyout within

the terms of the Company’s existing incentive plans, a bespoke

arrangement would be used.

Relocation policies

In instances where the new executive director is required to relocate or

spend significant time away from their normal residence, the Company

may provide one-off compensation to reflect the cost of relocation for

the executive director. The level of the relocation package will be

assessed on a case-by-case basis, but will take into consideration any

cost of living differences/housing allowance and schooling and will not

exceed a period of two years from recruitment.

Where an existing colleague is promoted to the Board, the Policy set out above would apply from

thedate of promotion, but there would be no retrospective application of the Policy in relation to

subsisting incentive awards or remuneration arrangements. Accordingly, prevailing elements of the

remuneration package for an existing colleague would be honoured and form part of the ongoing

remuneration of the person concerned. These would be disclosed to shareholders in the Directors’

Remuneration Report for the relevant financial year.

The Company’s policy when setting fees for the appointment of a new Chairman or non-executive

directors is to apply the policy that applies to current Chair or non-executive directors.

Recruitment and Promotion Policy continued Service contracts and letters of appointments

The Committee’s policy for setting notice periods is that normally they will be a maximum of 12 months.

The Committee may in exceptional circumstances arising on recruitment, allow a longer period, which

would in any event reduce to 12 months following the first year of employment. The non-executive directors

of the Company do not have service contracts. The non-executive directors are appointed by letters

of appointment. Each independent non-executive director’s term of office runs for a three-year period.

The Company follows the UK Corporate Governance Code’s recommendation that all directors be

subject to annual reappointment by shareholders.

Illustrative scenarios for executive directors’ remuneration under the new Policy

The charts below show the potential value in respect of the operation of the Directors’ Remuneration

Policy in 2026, showing potential split between different elements of remuneration under different

performance scenarios, as outlined below:

5 ‘Minimum’ (fixed pay i.e. salary, pension and benefits);

5 ‘On target’ (i.e. fixed pay and 60% of the maximum bonus that may be awarded);

5 ‘Maximum’ (fixed pay and the maximum variable pay that may be awarded); and

5 ‘Maximum with illustrative share price increase applied to RSP. (‘Maximum’ scenario, assuming

share price appreciation of 50% on the RSP).

These charts assume a constant share price, except for the illustrative share price appreciation

scenario applied to the RSP value only in the latter scenario.

Ian McLaughlin, CEO

Minimum

822

662

736

On target

2,220

368

822

1,104

736

Maximum

3,030

Dave Watts, CFO

Minimum

626

419

On target

1,464

209

626

698

419

Maximum

1,952

Fixed Annual bonus RSP Share price

Assumptions

5 Minimum pay is fixed pay only, i.e. salary + benefits + pension.

5 On-target pay includes fixed pay, 60% of the maximum bonus (with maximum equal to 150% of salary for the CEO and 125%

fortheCFO) and 100% vesting of the RSP awards (with grant levels of 100% of salary for the CEO and 75% for CFO)).

5 Maximum pay includes fixed pay and assumes 100% vesting of both the annual bonus and the RSP awards.

5 The illustration of ‘maximum’ assumes a 50% share price increase on the RSP award over the vesting period and is shown as‘share price’.

5 All amounts have been rounded to the nearest £1,000.

5 The value of taxable benefits is the cost of providing those benefits in the year ended 31 December 2025.

Vanquis Banking Group plc Directors’ Remuneration Policy 2026 to 2029 continued

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Directors’ Remuneration Report continued

Policy on other appointments

5 Executive directors are permitted to hold non-executive directorships but may only hold one non-executive directorship in a listed company – and may

retain the fees from their appointment, provided that the Board considers that this will not adversely affect their executive responsibilities.

Remuneration Policy – non-executive directors

Element and link to strategy Operation Maximum

Performance conditions

andrecovery provisions

Fees

Provides a competitive level of fees

to support recruitment and retention

of a Chairman (and NEDs) with the

necessary experience to advise,

andassist, the executives with

establishing and monitoring the

Group’s strategic objectives.

The Board is responsible for

settingthe remuneration of the

non-executive directors. The

Committee is responsible for setting

the Chairman’s fees. Non-executive

directors are paid an annual fee

and additional fees for chairing

ofcommittees.

The Company retains the flexibility

to pay fees for the membership of

committees. The Chairman does not

receive any additional fees for

membership of committees.

Fees are reviewed annually based

on equivalent roles in the

comparator group used to review

salaries paid to the executive

directors. Non-executive directors

and the Chairman do not participate

in any variable remuneration or

benefits arrangement.

The fees for non-executive directors

and the Chair are broadly set at a

competitive level against the

comparator group. In general, the

level of fee increase for the

non-executive directors and the

Chairman will be set taking account

of any change in responsibility and

will take into account the general

rise in salaries across the UK

workforce.

The Company shall pay to the

directors (but not alternate directors)

for their services as directors such

aggregate amount of fees as the

Board decides (not exceeding

£1,400,000 per annum or such larger

amount as the Company may by

ordinary resolution decide).

The Company will pay reasonable

expenses incurred by the non-

executive directors and Chairman

and may settle any tax incurred

inrelation to these.

No performance or recovery

provisions applicable.

Consideration of employment

conditions elsewhere in the Group

Each year, prior to reviewing the remuneration of

the executive directors and the members of the

executive team, the Committee considers a report

prepared by the Head of Reward detailing base

pay, benefits and share scheme practice across

the Company. The report provides an overview

of how colleague pay compares to the market

and any material changes during the year and

includes detailed analysis of basic pay and

variable pay changes within the UK.

While the Company does not directly consult with

colleagues as part of the process of reviewing

executive pay and formulating the Remuneration

Policy, the Company does receive an update and

feedback from the broader colleague population

on an annual basis using an engagement survey,

which includes a section relating to remuneration.

In addition, the Company receives feedback

from the Colleague Forum.

The Group aims to provide a remuneration

package for all colleagues that is market

competitive and operates the same core

structure as for the executive directors. The

Group operates colleague share and variable

pay plans, with pension provisions provided

forall executive directors and colleagues. In

addition, any salary increases for executive

directors are expected to be generally in line

with those for UK-based colleagues. The

Committee annually publishes a section on

fairness, diversity and wider workforce

considerations as part of the Directors’

Remuneration Report.

Vanquis Banking Group plc Directors’ Remuneration Policy 2026 to 2029 continued

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Directors’ Remuneration Report continued

Remuneration principles and cascade of pay

We strongly believe in fair and transparent reward throughout the organisation and when making decisions on executive remuneration the Committee considers the context of wider workforce remuneration.

This section shows our remuneration principles and how, in 2025, they are cascaded throughout the organisation. The Executive Directors’ Remuneration Policy is cascaded down the organisation ensuring that

there are common goals. The elements of the Executive Directors’ policy are aligned for the wider workforce and the Executive Directors. Differences in policy implementation between seniority levels reflect

our remuneration philosophy. For instance, the balance between fixed and variable pay is shifted toward fixed pay for our colleagues in more-junior roles and towards variable pay for those in more-senior

roles. A large proportion of variable pay for senior employees, and the majority of variable pay for the Executive Directors, is delivered in shares over multiple years – aligning their interests more closely with

those of shareholders.

Our strategy (2025)

During the year we made significant strides in transforming Vanquis into a more customer-focused, efficient, and resilient business. We are shifting from a product-led approach to a needs-driven,

integrated model that better serves customers and supports sustainable growth.

Our remuneration principles

5 Support delivery of the Group’s

business strategy, realise our vision

and be customer champion within

our sector.

5 Have flexibility in delivering

totalremuneration outcomes

inchanging market, economic,

commercial and regulatory

circumstances.

5 Maintain a competitive reward and recognition offering in the markets in which we compete, thereby supporting our

talent attraction, engagement and retention aims.

5 Ensure remuneration outcomes are fair and consistent, reflect pay for performance and are clear and transparent for

all our colleagues.

5 Support and mitigate any conflicts of interests.

5 Manage remuneration opportunities and outcomes for regulated colleagues under the SMCR and material risk takers

under the Remuneration Code.

5 Support the effectiveness of the risk management and internal control framework and incentivise the delivery of the

business strategy within risk appetite via a controls-based framework and positive risk conduct culture.

5 Drive the Group’s ESG strategy,

including diversity, equality

andinclusion agenda.

5 Align the interests of our

colleagues with those of

ourcustomers, regulators

andshareholders.

Remuneration governance

The Committee held three scheduled meetings in 2025 plus one ad hoc meetings. The following schematic sets out the key considerations for the Remuneration Committee during 2025:

Governance Annual bonus Share plans All

colleague

matters Shareholders General DRR Design Review Grant Review Risk

January

March

July (ad hoc)

December

The CEO, CFO, CPO and Head of Reward also attend meetings by invitation, to provide advice and respond to specific questions. The CRO attends several meetings throughout the year to provide updates,

where necessary. The General Counsel and Company Secretary acts as secretary to the Committee. In no case is any individual present when their own remuneration is discussed.

Advisors to the Committee

To ensure that the Company’s remuneration practices are in line with best practice, the Remuneration Committee has appointed independent external remuneration advisors, PricewaterhouseCoopers LLP

(PwC). This appointment in 2020 followed a competitive tender process. PwC attends meetings of the Committee. The Committee reviewed the performance of PwC during 2025 and determined that it was

strong, and that the appointment should continue into 2026.

Fees, on a time-spent basis, for the advice provided by PwC to the Committee during 2025 were £106,565 excluding VAT (2024: £98,751). Other than in relation to advice on remuneration, PwC provides

subjectmatter expertise support to management on specific projects when requested. In 2025, this has included support in relation to regulatory consulting and accounting advice. The Committee is

satisfiedthat PwC engagement partners and teams that provided remuneration advice to the Committee do not have connections with the Group or the executive directors that may impair their objectivity

and independence.

Annual Report on Remuneration

110 – Vanquis Banking Group plc Annual Report and Accounts 2025

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Directors’ Remuneration Report continued

Single total figure of remuneration (audited)

The table below sets out a single total figure of remuneration for each director for the year ended 31 December 2025 and the prior year:

Salary/fees

£’000

Role Based

Allowance

(RBA)

£’000

Taxable

benefits

£’000

Annual

bonus

£’000

RSP

£’000

Pension

£’000

Total

£’000

Total

fixed

remuneration

£’000

Total

variable

remuneration

£’000

Executive directors

Ian McLaughlin 2025 725 n/a 69 272 736 73 1,875 867 1,008

2024 725 n/a 112 — — 73 910 910 —

Dave Watts, 2025 550 n/a 12 172 — 55 789 617 172

2024 550 n/a 11 — — 55 616 616 —

Non-executive directors

Sir Peter Estlin 2025 275 n/a 1 n/a n/a n/a 276 276 n/a

2024 275 n/a 1 n/a n/a n/a 276 276 n/a

Michele Greene 2025 112 n/a 2 n/a n/a n/a 114 114 n/a

2024 75 n/a — n/a n/a n/a 75 75 n/a

Graham Lindsay 2025 95 n/a 3 n/a n/a n/a 98 98 n/a

2024 90 n/a 5 n/a n/a n/a 95 95 n/a

Oliver Laird

2025 95 n/a 2 n/a n/a n/a 97 97 n/a

2024 61 n/a — n/a n/a n/a 61 61 n/a

Karen Briggs

2025 80 n/a 1 n/a n/a n/a 81 81 n/a

2024 61 n/a — n/a n/a n/a 61 61 n/a

Jackie Noakes

2025 80 n/a — n/a n/a n/a 80 80 n/a

2024 57 n/a — n/a n/a n/a 57 57 n/a

Angela Knight

2025 9 n/a — n/a n/a n/a 9 9 n/a

2024 109 n/a 1 n/a n/a n/a 110 110 n/a

Paul Hewitt

2025 8 n/a 4 n/a n/a n/a 12 12 n/a

2024 95 n/a 5 n/a n/a n/a 100 100 n/a

1 Executive directors receive standard market comparable benefits such as medical insurance. For the current CEO, the temporary travel allowance of £100,000 per annum that ended 26 July 2025 is

included here. NEDs have travel expenses reimbursed and, to the extent that those are taxable, grossed up for tax and NIC.

2 40% of any annual bonus earned is deferred into shares for an additional three years (subject to continued service, in normal circumstances).

3 2023 RSP that will vest in September 2026 has been adjusted by 36.2% to account for an estimate of dividends not paid over the period, Based on a closing share price on 31 December 2025 of £1.196.

4 Pension participation is via a defined contribution plan (or cash alternative) with no executive director having a prospective entitlement under a defined benefit plan.

5 Appointed 27 March 2024.

6 Left 29 January 2025.

Payments made to past directors

Previous CEO (Malcolm Le May)

Following the announcement of Malcolm’s

retirement on 24 January 2023, he was considered

a good leaver. His RSP 2022 award, which was

adjusted downwards by 12.8% (see page 113),

vested on 7 April 2025 with a value of £90,529. His

unvested RSP 2023 will vest on its normal vesting

dates in line with the relevant rules and the Policy.

RSP awards will be time pro-rated to his last day

of employment and subject to the performance

underpin any dividend equivalent adjustments.

The shareholding requirement will continue to

apply for a period of two years from his date of

cessation of employment in line with the Policy.

Previous CFO (Neeraj Kapur)

As previously reported, on 7 August 2023

Neerajinformed the Board that he would

bestepping down from his role and as an

executive director with immediate effect for

personal reasons and Neeraj left employment

on23 February 2024. HisRSP 2022 award, which

was adjusted downwards by 12.8% (see page 113),

vested on7April 2025 with a value of £66,565. His

unvested RSP 2023 will vest on its normal vesting

dates in line with the relevant rules and the Policy.

RSP awards will be time pro-rated to his last day

of employment and subject to the performance

underpin any dividend equivalent adjustments.

The shareholding requirement will continue to

apply for a period of two years from his date of

cessation of employment in line with the Policy.

No payments for loss of office were made

in2025.

Annual Report on Remuneration continued

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Directors’ Remuneration Report continued

Annual Report on Remuneration continued

2025 bonus outcome calculation (audited)

The bonus is based 60% on financial performance measures and 40% on non-financial performance

measures. The tables below set out performance against the targets set for the 2025 bonus and

theoutcome.

Details of the financial assessment

Performance range

Threshold Target Maximum Outcome Weighted

Financial targets 75% 100% 125% Actual Weighting as % of max outcome

Statutory (L)/PBT £6.6m £8.8m £11.0m 9.2m 25% 67% 16.8%

Statutory ROTE 1.3% 1.7% 2.1% 2.3% 25% 100% 25%

Cost-income ratio 61.9% 58.4% 54.9% 58.4% 10% 60% 6%

Details of the non-financial assessment

The non-financial element was assessed at 76.2% of maximum (30.5% Weighted) achievement with

this broken down, in 2025, asfollows:

Strategic pillars Metric Assessment of non-financial metrics Rating

Strategy

Cards Priority

OperatingGroup

We are growing the Cards book in a measured way,

prioritising long-term profitability. In 2025 we have

broadened distribution across more channels, introduced

product variants to reach a wider mix of customers, and

expanded tailored campaigns for our existing base to

support appropriate usage and deliver value to customers

and the bank. We built momentum throughout 2025 and

continue to balance sustainable new acquisition with

deepening relationships across the portfolio, with a clear

focus on lifetime value and disciplined risk.

On target

(plus)

75%

Deliver a Future Bank

Strategy

Our strategy is built on three pillars: Serve More, Serve

Responsibly and Scale Profitably.

Over the course of 2025, we developed the Future Bank

Strategy with input from the Board, the Audit Committee,

the executive team and other key stakeholders. On 26

February 2026, we set out our ambition to become the UK’s

most trusted and inclusive specialist bank by unlocking

financial opportunity for underserved customers and

helping them thrive.

We will deliver this ambition by:

5 Serving More – reaching more customers and

deepening relationships across the underserved UK

adult population.

5 Serving Responsibly – ensuring our lending is affordable

for customers, enabling them to build financial resilience,

whilst supporting financial inclusion; and

5 Scaling Profitably – growing efficiently, optimising

capital deployment and enhancing long-term returns.

On target

(mid)

60%

Strategic pillars Metric Assessment of non-financial metrics Rating

Strategy

continued

Delivery of five key tech

transformation

programmes progressing

to plan

Gateway – is substantively delivered and will complete

in2026. Gateway is already improving decisioning, speed

and consistency, and will be a key enabler of scale,

efficiency and enhanced customer experience in the years

ahead including the adoption of Agentic AI, which is

already underway. It is on track to deliver £23–£28m of

future cost savings across Operations and Technology.

Digital transformation – we entered customer beta

testing for our new mobile app at the end of 2025,

launching on general release in app stores in early

January, with a phased move of customers from old to

new app during Q1 2026 and ongoing new feature

development through the year.

Data transformation – continued good progress building

out our new data and analytics platforms, including the

successful implementation of the first production use-cases

covering FCA Product Sales Data reporting and customer

credit limit increase data processes. Development of

priority features aligned to our Gateway transformation

roadmap will continue throughout 2026.

One Vanquis (modern workplace) – we continued to

enhance the single IT platform for colleagues, which was

introduced in 2024, by providing all staff with new laptops

and Windows 11. Plans to roll out Microsoft Co-pilot to all

staff are in place.

HR transformation – a new HR system was launched

withall staff now in a single system for all HR processes

and payroll.

Above target

(mid)

90%

Customer

Customer satisfaction

(CSAT)

The measurement of customer satisfaction (CSI) is

undertaken in partnership with the Institute of Customer

Service. The survey enables Vanquis to benchmark its

customer satisfaction performance against the UK banks

and building societies average. Vanquis finished the year

on a CSI score of 81.3 (Average across year 83.7%), above

the industry benchmark of 81.1 (July 2025).

Above target

(minus)

80%

Complaints

Complaints handling

time(excluding

responsiblelending)

Our operations teams delivered a strong performance

throughout 2025 resolving 99.41% of applicable complaints

within the 56 day requirement.

Above target

(plus)

100%

Operational resilience

New metrics to support the embedding of operational

resilience was approved for inclusion in the business

scorecard by RemCo in July. It aims to measure how our

frameworks and processes have been adopted and are

being applied across our broader business. The measures

are culture indicators for operational resilience and track

three key areas: People (e.g. completion of mandatory

training); Risk Management (e.g. effective controls); and

Incident & Change Management (e.g. faster responses to

incidents). A good level of adherence has been seen since

the introduction.

On target

(mid)

60%

112 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Directors’ Remuneration Report continued

Strategic pillars Metric Assessment of non-financial metrics Rating

Colleague and

community

Colleague engagement

Great Place To Work

TrustIndex

Our Great Place To Work

Trust Index increased 13 points to

73% in October 2025 from 60% in December 2024. Vanquis

was officially certified as a Great Place To Work

for the first

time and was significantly above the 65% threshold required

for certification. Our strong performance was supported by

a range of initiatives that were delivered in 2025 including:

5 Leadership and development: an enhanced

performance management approach, delivery of a

leadership programme, and stand-ups and open-door

sessions with the executive team.

5 Policies and benefits: a range of new initiatives including

birthday leave, paid carer’s leave, flexible bank

holidays, buy/sell holiday, signing of the Armed Forces

Covenant, discounted health assessments, working

abroad, and enhanced neonatal leave.

5 Systems and tools: a new HR system and new laptops

for colleagues.

5 Culture and inclusion: a range of inclusion and

diversityinitiatives as we celebrated five years of

ourinclusion community.

5 Communication: launched a new, digital platform for

colleagues to interact and share achievements and

regular, all colleague townhalls.

Above target

(plus)

100%

Diversity in leadership

Meeting the Women in

Finance Charter’s gender

diversity targets in senior

management by making

progress towards having

40% female representation

inour senior management

population by the end

of2027

The proportion of female representation in our senior

leadership population decreased marginally in2025,

mainly due to the mix of leavers and starters. In2025,

wedelivered a range of initiatives to supportour Women

in Finance Charter commitment of achieving 40% female

representation in our senior leadership population by 2026.

These initiatives included:

5 Launching leadership apprenticeships to help high

potential, senior women to progress their careers.

5 Establishing a mentoring programme to support

thewider female talent pipeline.

5 Expansion of our Women’s Network with more regular

sessions and guest speakers.

5 Introducing a monthly gender data pack to provide

the executive team with greater oversight

andaccountability.

5 Enhanced talent attraction via partnerships

withfemale-focused job boards.

Below

threshold

Colleague volunteering

Volunteering hours delivered

to support the communities

we serve

Throughout 2025, colleagues contributed 3,061 volunteering

hours to a range of charitable and community causes.

Thisis above our stated target for the year. This figure

comprised 2,369 hours that were volunteered to support

Company-led initiatives (e.g. team challenges, employability

skills workshops for local schools and colleges, assisted

reading from primary school pupils and numeracy skills

sessions) and 691 hours to support the specific causes

thatwere of interest to individual colleagues.

Above target

(plus)

100%

Risk overlay

A risk overlay approach was used for potential risk adjustment with a range of factual criteria for

assessment agreed with the Committee. This forms the basis of our Group variable risk adjustment

framework and allows for a more flexible and holistic approach to be adopted, which considers not

only the business outcomes (quantitative), but also how these have been achieved (qualitative).

After discussion with the Group CRO, and the Chair of the Group Risk Committee, the Committee

concluded that, overall, the risk position has remained stable in 2025.

Remuneration Committee discretion – final outcome for 2025

In determining the final bonus outcome, The Committee exercised its discretion to apply a downward

adjustment to the formulaic bonus payouts for the executive directors. The adjustment reduced the

payout to 25% of the maximum opportunity, consistent with the approach applied for all colleagues

Scheme interests awarded in the year (audited)

Deferred Bonus Plan (DBP)

There were no DBP awards made during 2025 as a result of there being no bonus for performance

year 2024 (as reported last year).

RSP 2025 award grant

The RSP awards made during 2025 are set out below. As reported in last year’s report, in light of the

performance delivered in 2024 and the Group’s financial position, the Committee determined that it

would not be appropriate to make any RSP awards in April 2025. The Committee had reserved the

right to reconsider this following the announcements of the 2025 half-year results and taking into

account the Group’s financial performance in the first half of 2025, as well as the shareholder and

employee experience. The Committee noted the improvement in financial performance of the business

in the first half of 2025, as the Group returned to profit, with growth in customer balances and return

to robust interest margins, and the strong growth in share price, which more than doubled in the first

six months of the year. Against this backdrop, the Committee determined that it would be appropriate

to award the full RSP grant in September 2025 in line with the Policy. No adjustment was determined

to be necessary for any potential for windfall gains as per our internal policy, a further assessment

on windfall gains will be carried out at the time of vesting as per the RSP underpin requirements. The

face value is based on the Company’s share price on 9 September 2025 of £1.1224. The grant price is

calculated using the average price of a Vanquis Banking Group share for the five dealing days prior

to grant and discounted from that price at grant to reflect the absence of dividend equivalents

during the vesting period.

Executive director Date of award

RSP award

(share options)

Face value

of award Date of vesting

End of

holding period

Ian McLaughlin 9 Sept 2025 645,937 £725,000 9 Sept 2028 9 Sept 2030

Dave Watts 9 Sept 2025 367,516 £412,500 9 Sept 2028 9 Sept 2030

Annual Report on Remuneration continued

2025 bonus outcome calculation (audited) continued

Details of the non-financial assessment continued

113 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Directors’ Remuneration Report continued

Annual Report on Remuneration continued

Scheme interests awarded in the year (audited) continued

RSP 2025 award grant continued

These awards are conditional share awards without any performance targets. However, they are

subject to underpins that will apply over the initial three-year vesting period. The Committee will take

into account the following factors (amongst others) when determining whether to exercise its

discretion to adjust the number of shares vesting:

5 whether threshold performance levels have been achieved for the performance conditions for the

bonus for each of the three years in the vesting period;

5 the underlying financial performance progression of the Group over the vesting period;

5 whether there have been any sanctions or fines issued by a regulatory body, participant

responsibility may be allocated collectively or individually;

5 whether there has been material damage to the reputation of the Company, participant

responsibility may be allocated collectively or individually;

5 the potential for windfall gains;

5 the level of colleague and customer engagement over the vesting period; and

5 the level of achievement of our approach to ESG as set out by the Board.

In all cases, vesting is subject to the Committee’s holistic assessment based on business performance,

individual performance or wider Group considerations. The RSP awards on vesting must be held

(subject to sales to meet PAYE and NIC liabilities) for a period of two years following vesting.

RSP 2022 award vesting (audited)

As noted in last year’s report, the Committee’s interim assessment as at 31 December 2025 suggested

that a downwards adjustment of 12.8% would be required for the RSP 2022 awards. The Committee

reassessed the potential for windfall gains and decided that no further adjustment was required.

RSP 2023 award vesting (audited)

The vesting of the RSP 2023 award is subject to an underpin, which provides discretion for the

Committee to consider whether any adjustment to vesting should be made. The underlying desire was

(and remains) to ensure that participants have been positive custodians of: (i) the underlying financial

health of the business; (ii) maintaining our reputation; (iii) making progress on our strategic imperative

of ‘being a leading specialist bank focused on underserved markets’; (iv) ensuring that we meet our

ESG commitments (and, in particular, our social commitments); and (v) appropriately focused on our

agreed risk appetite. The Committee reviewed performance against the underpin attached to the RSP

2023 awards (and the underlying desire as set out above) as at 31 December 2025 (the end of the

last full performance year prior to vesting), and took into account a number of factors, including:

5 formulaic threshold performance levels were exceeded overall for the performance conditions for

the Bonus Plan for one of the three years in the vesting period, i.e. 2025. The threshold was not

met for the financial year 2023 or 2024;

5 the financial performance progression of the Group over the vesting period was not in line

withexpectation;

5 the regulatory position of the Company remains positive and there have been no sanctions

orfines issued by a regulatory body;

5 the potential for windfall gains (see below);

5 there has been material damage to the reputation of the Group (as viewed by our investors)

following the announcement of the interim results for the six months ended 30 June 2023.

TheCommittee noted that this was considered and fully reflected in the RSP 2020 award

vestingas previously disclosed; and

5 the level of colleague and customer engagement over the vesting period remains satisfactory.

The Committee also took into account the decisions made in relation to the previous annual bonuses

(2023 and 2024), RSP 2021 and RSP 2022 award vestings:

5 the poor financial performance of 2023 and 2024 meant that there was no bonus payout for the

2023 and 2024 performance years respectively for the RSP 2023 award recipients;

5 the significant reduction in share price over the vesting period; and

5 the adjustment for the previous RSP 2020, RSP 2021 and RSP 2022 awards to reflect the damage

to the reputation of the Group (as viewed by our investors), and the significant fall in share price

in 2023 (underpinned by poor financial performance of 2023).

With respect to performance in 2024, the Committee needed to determine how best to apportion the

issues that created the loss, given that they spanned the RSP’s three-year period, these being the

Vehicle Finance receivables review, other one-off items and the in-year 2024 trading loss. After careful

consideration, the Committee concluded that a total downwards adjustment of 30% should be

applied, which is in line with decisions taken on previous RSP’s but that it would be unreasonable to

adjust fully in any one year. As a result, the decision was taken to apply equally across the three

years and hence a 10% downwards adjustment will be made to the RSP’s issued in 2022, 2023

and2024.

This results in a 10% downwards adjustment to the RSP 2023 for the CEO, previous CEO and the

previous CFO, as well as to all other RSP 2023 award recipients.

The RSP 2023 award is subject to a dividend equivalent review at vest because the RSP 2023 award

price was adjusted downwards at grant to take into account forecast consensus dividends during

thevesting period. The Committee has reviewed the actual dividends paid during the vesting period

(which were lower) and has exercised discretion and made an additional downwards adjustment of

9.1% to the RSP 2023 award for the previous CEO, the previous CFO and all other RSP 2023 award

recipients. The RSP awarded to the CEO in September 2023 is subject to a provisional downwards

adjustment of 26.2% to reflect dividend equivalents not paid over the vesting period. Any change

inthe final adjustment will be disclosed in the 2026 Directors’ Remuneration Report.

114 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Directors’ Remuneration Report continued

Deferred Bonus Plan (DBP) 2023 award vesting (audited)

The DBP 2023 award is subject to a dividend equivalent review at vest because the DBP 2023

awardprice was adjusted downwards at grant to take into account forecast consensus dividends

during the vesting period. The Committee has reviewed the actual dividends paid during the vesting

period (which were lower) and have exercised discretion and made an additional downwards

adjustment of 9.1% to the RSP 2023 award for the previous CEO (Malcolm Le May) and the previous

CFO (Neeraj Kapur).

Statement of directors’ shareholding and share interests (audited)

The table below shows the interests of the directors and connected persons in shares (owned outright

or unvested) as at 31 December 2025. There has been a change to Dave Watts’ shares of 310 owned

outright due to Buy as you Earn, and no further changes in any other of the directors’ interests in the

period between 31 December 2025 and 28 February 2026.

owned

outright

Unvested

shares not

subject to

performance

Unvested

share options

subject to

performance

Vested but

unexercised

options

Total

scheme

interests

Shareholding

guideline

% of salary

Current

shareholding

% of salary

Guideline

met?

Executive

directors

Ian McLaughlin

29,327 — 1,866,538 — 1,866,538 200% 2% No

Dave Watts 104,776 — 1,010,522 — 1,010,522 200% 11% No

Non-executive

directors

Sir Peter Estlin

300,000 — — — — n/a n/a n/a

Michele

Greene — — — — — n/a n/a n/a

Graham

Lindsay

65,405 — — — — n/a n/a n/a

Oliver Laird 13,900 — — — — n/a n/a n/a

Karen Briggs — — — — — n/a n/a n/a

Jackie Noakes — — — — n/a n/a n/a

Angela Knight — — — — — n/a n/a n/a

Paul Hewitt 106,502 — — — — n/a n/a n/a

1 Rounded to the nearest whole per cent. Shares owned outright and unvested shares not subject to performance are included when

assessing current compliance to shareholding guideline. Based on a closing share price on 31 December 2025 of £0.455.

2 Includes 50,000 shares held by a person closely associated with Sir Peter Estlin.

3 In addition to ordinary shares acquired during the financial year and those shares disclosed in previously Annual Reports, Graham

Lindsay’s shareholding includes an additional 3,617 ordinary shares, which he acquired under a Dividend Reinvestment Plan

between Sept 2019 and May 2025 and Ian McLaughlin’s shareholding includes an additional 876 ordinary shares, which he acquired

under a Dividend Reinvestment Plan between Sept 2024 and May 2025.

The shareholding guidelines for the current executive directors have not yet been met, but the Policy

provides for sufficient time to be compliant (within five years of joining). A breakdown of the journey

to compliance can be seen below.

Fees from other directorships

Ian McLaughlin has been on the Board of UK Finance since May 2024. Dave Watts has been a non-

executive director for CAF Bank since 23 August 2021. No fees are received from these appointments.

Statement of directors’ compliance with the Share Ownership Policy

The following sets out the expected level of share ownership that the executive directors will

acquireover the period 2025 to 2027. The current executive director holding requirement is 200%

ofbase salary.

Forecast executive director shareholding position

200%

150%

100%

50%

Own shares (purchased or

vested buyout/DBP/RSP)

Unvested shares not subject

toperformance (DBP)

Unvested shares subject

toperformance (RSP)

Current CEO

(Ian McLaughlin)

97%

Current CFO

(Dave Watts)

70%

Assumptions

1 Only share awards held on 31 December 2025 are included. Future RSP and DBP awards yet to be granted are not included.

2 A 63.8% vesting outcome for RSP 2023 has been applied. A 100% vesting outcome for RSPs 2024 and 2025 (interim assessment of

10% reduction for RSP 2024 is not yet reflected).

3 Figures are ‘net of tax’ and a personal tax rate of 47% over the period of vest.

4 Rounded to the nearest whole per cent. Share price remains static, based on a closing share price on 31 December 2025 of £1.196.

Annual Report on Remuneration continued

115 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Directors’ Remuneration Report continued

Annual Report on Remuneration continued

Relative importance of spend on pay

The table below shows how the Company’s performance metrics compare to total colleague pay

expenditure for the financial years ended 31 December 2024 and 31 December 2025.

Relative importance of spend on pay 2025 2024

Year-on-year

change

Shareholder distributions

£- m £2.5m (100)%

Net income £454.9m £446.4m 2%

Statutory (L)/PBT £8.3m £(138.0)m

Statutory EPS 3.2p (46.7)p

All remuneration costs

£101.7m £99.1m 3%

1 The Group sold its loan portfolio in 1H25 and this business segment is now presented as discontinued operations. Certain FY24

metrics in the table above are represented accordingly.

2 Distributions to ordinary shareholders.

3 Remuneration costs include aggregate gross wages and salaries paid to the Group’s employees and share-based payment charges

as referred to in the employment cost table (Note 11b) on page 161.

Service contracts

The executive directors are employed under contracts of employment with the Company.

Theprincipal terms of the executive directors’ service contracts are as follows:

Notice period

Executive director Position Date of contract From Company From director

Ian McLaughlin Chief Executive Officer 26 July 2023 12 months 12 months

Dave Watts Chief Financial Officer 1 November 2023 12 months 12 months

The Chairman and non-executive directors have letters of appointment. Dates of the directors’ letters

of appointment are set out below:

Name Date of original appointment Date and actual date of expiry

Sir Peter Estlin

19 April 2023 5 May 2026

Michele Greene 9 March 2023 5 May 2026

Graham Lindsay 1 April 2019 30 June 2028

Oliver Laird 27 March 2024 30 June 2027

Karen Briggs 27 March 2024 30 June 2027

Jackie Noakes 27 March 2024 30 June 2027

Angela Knight 31 July 2018 29 January 2025

Paul Hewitt 31 July 2018 29 January 2025

1 Sir Peter Estlin was appointed as director on 19 April 2023 and as Chairman on 15 September 2023.

Implementation of the Directors’ Remuneration Policy in 2026

The Policy was approved at the AGM on 15 May 2023 and with some minor amends will be presented

to the 2026 AGM. The table at the beginning of the document on page 98. Remuneration at a glance

summarises the key features of the Policy and how we plan to implement it in 2026. Full details can be

found on pages 100 to 108.

Element of remuneration Key features of Policy Implementation in 2026

Salary

An executive director’s base salary is set on appointment

and reviewed annually or when there isa change in

position or responsibility.

When determining an appropriate level of base salary,

the Committee considers:

5 pay increases for other colleagues;

5 remuneration practices within the Group;

5 any change in scope, role and responsibilities;

5 the general performance of the Group and

eachindividual;

5 the experience of the relevant director; and

5 the economic environment.

1st April salary increase of 1.5%

Ian McLaughlin

2026: £736,000

2025: £725,000

Dave Watts

2026: £558,000

2025: £550,000

Benefits

Benefits include market standard benefits

(includingmedical and health insurances).

No change from 2025.

Pension

The Company provides a pension contribution allowance

that is fair, competitive and in line with corporate

governance best practice.

No change from 2025.

CEO and CFO: cash allowance, 10%

of salary. 10% is the norm for the

Group’s Pension Plan.

116 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Directors’ Remuneration Report continued

Element of remuneration Key features of Policy Implementation in 2026

Annual bonus

The Committee will determine the maximum annual

participation in the Annual Bonus Plan for each year,

which will not exceed 150% of base salary.

The Annual Bonus Plan is based on a mix of financial

and strategic/operational conditions and is measured

over a period of one financial year.

The financial measures will account for no less than 50%

of the bonus opportunity.

There is no change from 2025.

Maximum opportunity:

5 CEO: 150% of base salary.

5 CFO: 125% of base salary.

Financial performance measures:

5 statutory reported PBT (25%);

5 statutory reported ROTE (25%);

and

5 cost-income ratio (10%).

40% non-financial will align to the

2026 business plan.

In addition, there is a risk overlay

and Tier 1 capital ratio gateway.

Deferral:

At least 40% of the bonus is

deferred, vesting pro-rata over

three years, in company shares.

Restricted Share

Plan (RSP)

Awards are granted annually to executive directors in

the form of conditional awards or options. Awards vest

at the end of a three-year period subject to:

5 the executive director’s continued employment

atthedate of vesting; and

5 the satisfaction of an underpin as determined by

theCommittee whereby the Committee can adjust

vesting for business, individual and wider

Companyperformance.

A two-year holding period will apply following the

three-year vesting period for all awards granted

totheexecutive directors.

Upon vesting, sufficient shares may be sold to pay

taxon the shares.

No change from 2025.

Maximum opportunity:

5 CEO: 100% of base salary.

5 CFO: 75% of base salary.

Subject to satisfaction of

anunderpin.

Further details are set out on

page97.

Element of remuneration Key features of Policy Implementation in 2026

Shareholding

requirements

Normal shareholding requirement of 200% of salary.

Additional requirement to hold 200% of salary for two

years following cessation of employment.

Executive directors have agreed to be bound by the

terms of the requirements and Company Secretariat will

monitor compliance.

No change from 2025.

CEO and CFO: 200% of salary.

The previous executive directors

(Malcolm Le May and Neeraj Kapur)

will remain subject to the

post-employment shareholding

requirements in line with the Policy.

Malus and clawback

Standard market practice (and regulatory requirements)

and malus and clawback provisions as at the time the

Policy was adopted. (see below).

No change from 2025.

Chairman and NED

fees

Provides a competitive level of fees to support

recruitment and retention of a Chairman (and NEDs)

withthe necessary experience to advise, and assist,

theexecutives with establishing and monitoring the

Group’s strategic objectives.

No change from 2025 for NEDs or

Chairman fees.

Annual Report on Remuneration continued

Implementation of the Directors’ Remuneration Policy in 2026 continued

117 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Directors’ Remuneration Report continued

Implementation of the Directors’ Remuneration Policy in 2026 continued

Malus and clawback

The Policy contains malus and clawback provisions, which are aligned to the requirements set out in

the FCA and PRA regulations for a Tier 3 bank. Malus is the adjustment of the Bonus Plan payments

or unvested long-term incentive awards (including RSP awards) or the imposition of additional

conditions because of the occurrence of one or more circumstances.

Clawback is the recovery of payments made under the Bonus Plan or vested long-term incentive

awards (including RSP awards) as a result of the occurrence of one or more circumstances. Clawback

may apply to all or part of a participant’s payment under the Bonus Plan or RSP award and may be

effected, among other means, by requiring the transfer of shares, payment of cash or reduction of

awards or bonuses.

The circumstances in which malus and clawback could apply are as follows:

5 discovery of a material misstatement resulting in an adjustment in the audited accounts of the

Group or any Group company;

5 the assessment of any vesting condition or condition in respect of an award under the Plan was

based on error, or inaccurate or misleading information;

5 the discovery that any information used to determine the award was based on error, or

inaccurate or misleading information;

5 action or conduct of a participant that amounts to fraud or gross misconduct;

5 events or the behaviour of a participant have led to the censure of a Group company by a

regulatory authority or have had a significant detrimental impact on the reputation of any Group

company provided that the Committee is satisfied that the relevant participant was responsible

or is attributable for the censure or reputational damage;

5 failure of risk management including but not limited to a material breach of risk appetite and

regulatory standards;

5 material downturn in business performance as determined by the Committee; or

5 corporate failure.

The table below sets out the periods for malus and clawback that align to the FCA and PRA

regulations. The Committee believes that the rules of the plans and the Group’s Malus and Clawback

Policy provide sufficient powers to enforce malus and clawback where required. In 2025 the provisions

set out under the Malus and Clawback Policy were not exercised.

Annual bonus (cash) Annual bonus (deferred shares) Restricted shares

Malus Up to the date of the

cashpayment.

To the end of the three-year

vesting period.

To the fifth anniversary of

the award date.

Clawback Clawback applies for a

period of seven years,

extendable up to one year.

The total malus and

clawback period may be

extended to ten years where

there is an ongoing internal

or regulatory investigation.

Clawback applies for a

period of seven years,

extendable up to one year.

The total malus and

clawback period may be

extended to ten years where

there is an ongoing internal

or regulatory investigation.

Two years following the

fifthanniversary of the

award date.

The total malus and

clawback period may be

extended to ten years where

there is an ongoing internal

or regulatory investigation.

NED fees for 2026

Both NED fees and the Chairman fees were reviewed with no change by the Board in December 2025

and the Committee in January 2026.

2026 2025

Chairman of the Board £275,000 £275,000

Board fee

£70,000 £70,000

Senior independent director

£25,000 £25,000

Committee Chair £20,000 £20,000

Committee members £5,000 £5,000

1 Board fee covers all duties, including service on the Company’s and Vanquis Bank Limited Nomination Committees (NomCo) or

Company subsidiaries.

2 During the year, fees for the Senior Independent Director were reviewed and increased from £15,000 to £25,000, back dated to the

start date of 29 January 2025.

Annual Report on Remuneration continued

118 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Directors’ Remuneration Report continued

Our approach to fairness and wider workforce considerations

This section of the report brings visibility of remuneration across the entire workforce together in one

place. In this section, we provide context to our director pay by explaining our colleague policies and

our approach to fairness, including the following:

5 the report received by the Committee on wider workforce pay policies and whether the approach

to executive remuneration is consistent and the alignment of the incentives operated by the

Company with its culture and strategy;

5 general pay and conditions in the Group;

5 gender diversity and pay gap; and

5 comparison metrics on executive and colleague remuneration.

In order for the Committee to carry out its oversight review of wider workforce pay, policies and

incentives, the Committee receives a report annually from the Group setting out key details of

remuneration throughout the Group.

Details of the information reviewed by the Committee and findings are set out below.

Overview of workforce remuneration and the Committee’s review

The table illustrates how the Remuneration Policy for executive directors in 2025 cascaded throughout

the colleague population.

% of

workforce

Average

increase

in base

salaries

Variable pay

plans

Pension

Benefits

Commission

schemes

Annual

bonus

Executive directors 0.2% 0.0% No All Yes Yes Yes

Senior management 3.3% 5.6% No All Yes Yes Yes

Management 29.7% 5.2% No All Yes Yes Yes

All other colleagues 66.8% 5.4% No All Yes Yes Yes

1 Base salaries:

5 Base salaries are market competitive and determined with reference to role type, location, responsibility (level), experience and

market practice.

5 Annual salary increases are applied on an equitable and objective basis dependent on role type.

5 Includes 2025 pay review and compares 31 December 2024 with 31 December 2025 data.

2 Variable pay:

5 In line with our approach to executive director remuneration, a proportion of the remuneration for the wider workforce is in the

form of variable pay, linked to the achievement of stretching targets that align with the Company’s strategic goals.

5 All colleagues are eligible for variable pay provided they have joined before 1 October of the previous performance year, are

performing satisfactorily, and are not under notice of termination. Variable pay is linked to the Group’s performance in the form

of annual bonuses. Variable pay is determined with reference to financial performance and/or the achievement of non-financial

objectives which are aligned to the Group’s strategic priorities.

3 Share plans:

5 Only some management, and all senior management and executive directors participate in the RSP.

5 Historically, participation in the long-term incentive schemes has been limited since the Group’s variable pay arrangements

provide the strong linkage between workforce remuneration and the Group’s financial performance and/or strategic priorities.

5 All colleagues have access to share ownership schemes (SAYE (an all-employee plan enabling colleagues to save monthly and

receive an option to purchase Group shares at a discount following a minimum of three years) and SIP (an all-employee plan

enabling the colleagues to purchase Group shares on a monthly basis out of deductions from salaries, also receiving some

Matching Awards from the Group).

4 Pension:

5 Maximum employer contributions are consistent across the Group (maximum 10% employer contribution for the Group Defined

Contribution arrangements), with minor deviations appropriate for role type or for historical reasons, which were actively

addressed in 2025. There also exists a NEST pension arrangement.

5 Benefits:

5 Consistent approach applied and determined with reference to role type, market practice and seniority.

The levels of remuneration and the types offered will vary across the Company depending on a

colleague’s location, level of seniority and role. The Committee is not looking for a homogeneous

approach; when conducting its review, it is paying particular attention to:

5 whether the element of remuneration is consistent with the Company’s remuneration principles;

5 if there are differences, whether they are appropriate; and

5 whether the approach is fair and equitable in the context of other colleagues.

The key findings of the Committee’s holistic review for 2025 have been set out in the following table.

Element Findings

Salary Average salary increases for colleagues across the Company are being applied on an

equitable and objective basis. All colleagues, whatever their age, are paid above the

National Living Wage (on a full-time basis).

Pensions All colleagues are eligible for enrolment in a defined contribution pension arrangement

and all colleagues are now eligible to join our main pension provider with the same terms

and conditions across the Group.

Benefits Benefits are offered according to the level of seniority of the role in line with market

practice and policy. Our bespoke benefits offering is broadly in line with similar companies.

Incentives All of our colleagues have the ability to share in the success of the Company through

incentive compensation in the form of variable pay linked to performance.

The Committee is satisfied that the approach to remuneration across the Company is broadly

consistent with the Company’s principles of remuneration and pay. Further, in the Committee’s opinion

the approach to executive remuneration aligns with the wider Group Remuneration Policy and there

are no anomalies specific to the executive directors that are outside of Policy.

Additional remuneration disclosures

119 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Directors’ Remuneration Report continued

Additional remuneration disclosures continued

Communication and engagement with colleagues

The Board is committed to ensuring there is an open dialogue with our colleagues and the

Committeehas the authority to ask for additional information from the Company in order to

carryout its responsibilities.

The Colleague forum is an established arrangement to facilitate effective engagement between the

Board and the workforce and to encourage workforce participation in shaping strategic initiatives

and seek views on key decisions. It supports the Group in satisfying Provision 5 of the UK Corporate

Governance Code 2024, as well as capturing meaningful input and feedback from colleagues.

Our Colleague Forum has colleague representatives from across all areas and all levels of the

business and meets quarterly. The Designated non-executive Colleague Champion (who is also the

Chair of the Remuneration Committee) works closely with the Colleague Forum in his capacity as

engagement sponsor on behalf of the Board to agree a rhythm of dialogue and meeting attendance

to further cement the link between the Colleague Forum and the Board.

Alongside the Colleague Forum, we commission an annual Colleague Engagement Survey, which

isindependently administered by Great Place To Work

, as a channel for colleague voice and

feedback. The output from each Colleague Engagement Survey is reviewed by the Board and

appropriate actions are taken in response to any findings.

This is the fourth year that a consistent performance management framework was used fully across

the Group to assess colleagues’ performance and determine bonus allocations in line with the

Group’s values. Work has continued on harmonising pay and benefits opportunities for equivalent

roles across all areas of the business through the reward framework and the alignment of pension

schemes across the Group was completed in 2025. We have also published the minimum pay levels

bylevel and location in our move to greater pay transparency.

Living Wage, equal opportunities and diversity initiatives

A summary of the Company’s general policies in relation to Living Wage, equal opportunities and

diversity initiatives as follows:

Policy Description

Living Wage

employer

The National Living Wage is the amount of money all colleagues aged over 25 are legally

entitled to. Our policy is to ensure that all colleagues, whatever their age, are paid above

the National Living Wage.

Equal

opportunities

and diversity

initiatives

We foster an environment of equal opportunity across all employment practices – from

hiring and training to performance evaluations and career advancement. By embracing

inclusion and diversity, we harness the unique perspectives, experiences, and insights of

our team members to better serve both our customers and communities.

We demonstrate our commitment to inclusion & diversity through several key initiatives:

our participation in the Women in Finance Charter, our journey towards Disability

Confident certification, and our achievement of Silver Status from LGBT Great for LGBTQ+

DE&I excellence within Financial Services.

We encourage continuous development and training by offering a variety of learning

opportunities that cater to the diverse learning styles of our colleagues. In 2025, we

continued to focus on developing a data-driven approach to improve the quality of our

diversity data and analysis. This has allowed us to set gender diversity targets at a more

granular level.

Furthermore, we continue to nurture our established partnerships with membership

organisations to stay up to date with industry standards and align our policies and

processes with best practices. Through collaboration, we can continuously improve our

approach to inclusion, diversity and wellbeing, to create an inclusive and supportive

workplace for all.

Gender pay gap

We feel strongly about the importance of having a workforce that represents the customers we

serveand the communities we live and work in. We hire from diverse backgrounds, employing (as at

31 December 2025) 51.5% men and 48.5% women across our business, and our recruitment policies,

salary and bonus structures are designed to be gender neutral.

Whilst the gender pay gap has improved in 2025 at a Group level, there is still further improvement

needed. The Group recognises that the key driver behind both our hourly rate and bonus gap is a

higher proportion of male colleagues in senior roles, and so we continue to remain focused on

initiatives to increase female representation at senior management and leadership level. This is

evidenced further by our commitment to the Women in Finance Charter.

The Group Gender Pay Gap Reports, which are communicated internally to our colleagues, can also

be found on our website.

120 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Directors’ Remuneration Report continued

CEO pay ratio

For the purposes of calculating the CEO pay ratio, we have used Option A, which takes into

consideration the full-time equivalent basis of all UK employees and provides representative results

of the employee pay conditions across the Company. The table shows that the CEO pay ratio has

been improving (i.e. decreasing) since 2021. The main reasons for this are: (1) no salary increase for

theCEO since 2022, (2) salary reviews since 2024 focused on the lower paid population, and (3)

structural changes made to the business.

The volatility in this ratio is caused by the fact that the CEO pay is made up of a higher proportion

ofincentive pay than that of our colleagues, in line with the expectations of our shareholders.

Thisintroduces a higher degree of variability in his pay each year which affects the ratio.

In order to normalise the impact year-on-year changes to short and long-term incentive payments,

the information also shows the normalised CEO pay Ratio when ‘on-target’ bonus payouts are used

inthe calculation. In assessing our pay ratio versus likely ratios from industry peers with a similar

headcount, we believe that we are comparable but note that annual and long-term incentive

payments have varied considerably amongst this group. We also recognise that ratios will be

influenced by levels of colleague pay and, in the sector, colleague pay will be lower than in many

other sectors of the economy.

Year

25th

percentile

pay ratio

Median

pay ratio

75th

percentile

pay ratio

2026 (actual) Option A 50:7:1 31.8:1 21.1:1

2025 (actual) Option A

26.7:1 17.4:1 11.1:1

2024 (actual) Option A

34.7:1 23.8:1 13.1:1

2023 (actual) Option A 55.1:1 36.7:1 20.3:1

2022 (actual)

Option B 79.6:1 66.3:1 44.1:1

2026 (incl. target bonus) Option A 40.0:1 24.9:1 16.2:1

2025 (incl. target bonus) Option A

43.3:1 27.1:1 17.1:1

2024 (incl. target bonus) Option A

56:1 37.3:1 20.7:1

2023 (incl. target bonus)1 Option A 60.1:1 44.2:1 24.2:1

2022 (incl. target bonus) Option B 64.5:1 53.8:1 36.8:1

1 Restated (downwards) for 2022 due to the single figure of remuneration for 2022 being reduced as a result of the downwards

adjustment to the CEO’s RSP 2020 which vested on 9 November 2024.

2 For 2025 only the current CEO (Ian McLaughlin) has been used.

3 The CEO pay used in these calculations was the pro-rated blend of remuneration of the current CEO (Ian McLaughlin) and previous

CEO (Malcolm Le May).

Additional remuneration disclosures continued

Base salary and total pay and benefits for CEO and colleague percentiles

2025

Base salary (£’000) 725

Total pay and benefits (£’000) 1,875

Colleague headcount at 31 December 2025 1,294

Base salary (£’000)

Colleague at the 25th percentile 34

Colleague at the 50th percentile 52

Colleague at the 75th percentile 74

Total pay and benefits (£’000)

Colleague at the 25th percentile 37

Colleague at the 50th percentile 59

Colleague at the 75th percentile 89

1 Includes all benefits including those that are not taxable benefits (Life Assurance/PHI).

2 Excludes 10 NEDs. Colleagues included in the CEO pay ratio are 1,430.

Total remuneration for each colleague was calculated on a full-time equivalent basis and the lower

quartile, median and upper quartile colleagues were identified as at 31 December 2025. Colleague

total remuneration includes: basic salary, pension, maternity/paternity pay, annual cash bonus and

benefits. The total remuneration for the relevant colleagues was compared to that of the CEO.

The Company believes that the median pay ratio for 2025 is consistent with the pay, reward and

progression policies for the Company’s colleagues. We also considered the pay composition of the

colleagues who represent the median, lower and upper quartiles and were comfortable that it fairly

represents pay in the Company.

121 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Directors’ Remuneration Report continued

Additional remuneration disclosures continued

Percentage change in directors’ and colleagues’ remuneration

The Committee monitors the changes year on year between our directors’ pay and average colleague pay. As per our Policy, salary increases applied to executive directors will typically be in line with

thoseof the wider workforce. In accordance with the Companies (Directors’ Remuneration Policy and Directors’ Remuneration Report) Regulations 2019, the table below shows the percentage change fromthis

financial year to previous financial year in executive director and NED total remuneration compared to the change for the average of the percentage change for colleagues within the Company.

Thecomparator group is based on all colleagues.

Salary/fees Taxable benefits Short-term variable pay

2025

2024 2023 2022 2021 2025

2024 2023 2022 2021

Executive directors

Ian McLaughlin

0% 0% n/a n/a n/a -38% 0% n/a n/a n/a n/a n/a n/a n/a n/a

Dave Watts

0% 0% n/a n/a n/a 9% 0% n/a n/a n/a n/a n/a n/a n/a n/a

Non-executive directors

Sir Peter Estlin

0% 67% n/a n/a n/a 0% n/a n/a n/a n/a n/a n/a n/a n/a n/a

Michele Greene 49% -14% n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a

Graham Lindsay 6% -20% 0% 9% 8% -40% 150% -60% 150% -50% n/a n/a n/a n/a n/a

Oliver Laird 17% n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a

Karen Briggs -2% n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a

Jackie Noakes 5% n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a

Paul Hewitt 0% -3% 0% 9% 5% -100% 0% 67% 0% 50% n/a n/a n/a n/a n/a

Angela Knight 0% -15% 0% 9% 2% -20% n/a 0% n/a n/a n/a n/a n/a n/a

Average colleague 5.4% 8% 10% 8% 3% 35.9%

24%

14% 59% 0% —

n/a -100% -5% —

1 No bonus was paid in 2020 or 2024 and therefore there is no meaningful comparison with 2021 or 2025.

2 Reflects pro-ration for time as executive director in 2024.

3 2024 data is annualised for IM/DW/PE.2024. 2025 data is annualised for KB/OL/JN/PH/AK

4 Extension of the medical insurance benefits to all colleagues during 2024, ad increase of participate in PMI was also seen in 2025.

5 Sir Peter Estlin was appointed as director on 19 April 2023 and as Chairman on 15 September 2023.

122 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Directors’ Remuneration Report continued

CEO pay against total shareholder return (TSR)

The chart below shows the single figure of remuneration for our CEO over time rebased to 2015. Wehave also included our TSR performance over this

period against the FTSE 250, based on £100 invested. The FTSE 250 was chosen as, in the opinion of the Committee, the size and complexity of the

Company make this an appropriate basis for comparison.

Pay performance: TSR chart

2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

CEO

PC PC MLM MLM MLM MLM MLM MLM

MLM IM IM IM

CEO single figure of remuneration

(£’000) 6,315 962 71 1,387 1,507 818 1,972 2,056

551

910 393 1,875

Annual bonus/earning (% of maximum) 100 — — 69 53 — 96 78 — — — 25

LTIS/RSP vesting (% of maximum) 100 — — — — — — 65 75 n/a n/a 63.8

1 Peter Crook (PC), Malcolm Le May (MLM) and Ian McLaughlin (IM).

2 The single figure of remuneration for 2022 has been restated (see 3 below).

3 The RSP 2020 award (which formed part of the CEO single figure of remuneration for 2022) is restated to reflect the 35% downwards adjustment applied in November 2024.

4 The RSP 2021 award (which forms part of the CEO single figure of remuneration for 2023) reflects a 25% downwards adjustment as determined as part of the assessment of the RSP 2021 award

performance underpin.

5 The RSP 2023 September award (which forms part of the CEO single figure of remuneration for 2025) reflects a 36.2% downwards adjustment as determined as part of the interim assessment of the RSP

2023 award performance underpin and adjustment for payment of dividends over the vesting period. Final vesting and any changes to the above assessment will be disclosed in the 2026 Directors’

Remuneration Report.

The greater volatility of our CEO pay is due to the higher proportion of incentive pay in his package compared with that of our colleagues, whichintroduces a higher degree of variability in his pay each

year versus colleagues.

All data rounded to the nearest whole per cent.

Statement of shareholder voting

The table below shows shareholder voting

results in respect of our 2024 Remuneration

Report approved at the AGM held on 14 May

2025, and Directors’ Remuneration Policy

approved at the AGM held on 25 May 2023.

Vote on 2024 Annual Remuneration Report

atthe 2025 AGM.

Number of shares Percentage

For 197,478,136 99.9%

Against 190,612 0.1%

Withheld 17,491 n/a

Vote on Directors’ Remuneration Policy at the

2023 AGM.

Number of shares Percentage

For 203,831,473 95%

Against 11,098,605 5%

Withheld 4,604 n/a

Graham Lindsay

Remuneration Committee Chair

25 February 2026

Additional remuneration disclosures continued

Value (£) (rebased)

Vanquis Banking Group plc FTSE 250 (excl. investment trusts) CEO pay

Dec 21Dec 20Dec 15 Dec 16 Dec 17 Dec 18 Dec 19 Dec 22

100

150

200

Dec 23 Dec 24 Dec 25

123 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Directors’ Report

Our responsibilities as a listed business

In accordance with section 414C(11) of the Companies Act 2006, the directors present their report

forthe year ended 31 December 2025. Information relevant to the Directors’ Report that has been

covered in the Strategic Report has been listed below alongside its location. Both the Strategic

Report and the Directors’ Report have been prepared and presented in accordance with, and in

reliance upon, applicable company law. The liabilities of the directors in connection with both the

Directors’ Report and the Strategic Report shall be subject to the limitations and restrictions provided

by company law.

Other statutory information (including that required by Listing Rule 6.6.1(13))

Agreements with controlling shareholders Not applicable

Contracts of significance 190

Details of long-term incentive schemes 112 to 114

Directors’ indemnities 123

Dividends 125

Engagement with employees 74

How we had regard to suppliers, customers and others in a business relationship with

the Group 74 to 78

Events post-balance sheet 194

Risk management including principal risks 54 to 61

Future business developments 4 to 15

Going concern and viability statement 62 and 142

Greenhouse gas emissions, energy consumption and efficiency 42

Interest capitalised Not applicable

Non-pre-emptive issues of equity for cash in relation to major subsidiary undertakings Not applicable

Non-pre-emptive issues of equity for cash Not applicable

No political donations 127

Parent participation in a placing by a listed subsidiary Not applicable

Provision of services by a controlling shareholder Not applicable

Publication of unaudited financial information Not applicable

Purchase of own shares Not applicable

Research and development 127 and 171

Share capital – structure, voting and other rights 124

Share capital – employee share plan voting rights 125

Shareholder waivers of dividends 125

Shareholder waivers of future dividends 125

Waiver of emoluments by a director 112 to 113

Waiver of future emoluments by a director 112 to 113

Articles of association

The directors’ powers are conferred on them by

UK legislation and by the articles of association.

Changes to the articles of association must be

approved by shareholders passing a special

resolution and must comply with the provisions

of the Companies Act and the FCA’s Disclosure

Guidance and Transparency Rules.

Corporate governance statement

The Board considers that the Company was

compliant with all the provisions of the 2024 UK

Corporate Governance Code (the Code)

throughout 2025.

The Group’s Corporate Governance Report is set

out on pages 64 to 128.

Directors

The membership of the Board and biographical

details of the directors at the year end are given

on pages 66 and 67 and are incorporated into

this report by reference. Commentary about the

Board’s composition and Board tenure can be

found onpage 79.

All directors were present throughout 2025

andup to the date of signing the Annual Report

and financial statements 2025.

Angela Knight and Paul Hewitt stepped down

after the Board meeting on 29 January 2025.

Appointment and replacement

ofdirectors

Rules about the appointment and replacement

ofdirectors are set out in the Company’s

articlesof association. In accordance with the

recommendations of the Code, all directors

willoffer themselves for appointment or

reappointment, as appropriate, at the 2026 AGM.

Directors’ indemnities

The articles of association permit the Company

to indemnify directors of the Company (or of any

associated company) in accordance with section

234 of the Companies Act.

The Company may fund expenditure incurred

bydirectors in defending proceedings against

them. If such funding is by means of a loan, the

director must repay the loan to the Company,

ifthey are convicted in any criminal proceedings

or judgment is given against them in any civil

proceedings. The Company may indemnify any

director of the Company or of any associated

company against any liability.

However, the Company may not provide an

indemnity against:

1. any liability incurred by the director to the

Company or to any associated company;

2. any liability incurred by the director to pay

acriminal or regulatory penalty;

3. any liability incurred by the director in

defending criminal proceedings in which they

are convicted;

4. any liability incurred by the director in

defending any civil proceedings brought by

the Company (or an associated company)

inwhich judgment is given against them; or

5. in connection with certain court applications

under the Companies Act, no indemnity

wasprovided and no payments pursuant

tothese provisions were made in 2025 or

atany time up to the date of this report.

There were no other qualifying indemnities in

place during this period. The Company maintains

both a deed of indemnity in favour of the

directors and directors’ and officers’ liability

insurance, which gives appropriate cover for

anylegal action brought against its directors.

124 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Directors’ powers

Subject to the articles of association, UK

legislation and any directions given by special

resolution, the business of the Company is

managed by the Board. The directors currently

have powers in relation to the issuing and buying

back of the Company’s shares, which were

granted by shareholders at the 2025 AGM along

with the right to disapply pre-emption rights in

certain circumstances. The Board is seeking

renewal of these powers at the 2026 AGM.

Conflicts of interest

The Companies Act and the articles of

association require the Board to consider any

potential conflicts of interest of its members. The

Board has a formal policy and operates formal

procedures regarding conflicts of interest in

order to identify and manage conflicts and to

maintain independent judgement. All members

of the Board have completed conflict of interest

forms, which are reviewed annually. All directors

have an ongoing duty to notify the Company of

any changes and to ensure that appropriate

authorisation is sought where required and are

required to renew and confirm their external

interests annually. The Board (excluding the

director concerned) considers and, if appropriate,

authorises each director’s reported actual

andpotential conflict of interest, taking into

consideration what is in the best interests of

theCompany and whether the director’s ability

to act in accordance with his or her duties is

affected. The Board will refer to the Conflict

ofInterest Policy for the most appropriate

mitigating control. Records and Board minutes

of all authorisations granted by the Board

andthe scope of any approvals given are held

and maintained by the General Counsel and

Company Secretary.

Share capital

The Company’s issued ordinary share capital

comprises a single class of ordinary shares.

Therights attached to the ordinary shares

areset out in the articles of association. Each

share carries the right to one vote at general

meetings of the Company. No new shares

wereissued to satisfy awards made under

theLong Term Incentive Scheme 2015 (LTIS),

theRestricted Share Plan (RSP) or the Deferred

Bonus Plan (DBP).

Rights of ordinary shares

All of the Company’s issued ordinary shares are

fully paid up and rank equally in all respects

and there are no special rights with regard to

control of the Company. The rights attached to

them, in addition to those conferred on their

holders by law, are set out in the articles of

association. There are no restrictions on the

transfer of ordinary shares or on the exercise

ofvoting rights attached to them, except:

1. where the Company has exercised its right

to suspend its voting rights or to prohibit

their transfer following the omission by their

holder or any person interested in them to

provide the Company with information

requested by it in accordance with Part 22

of the Companies Act; or

2. where their holder is precluded from

exercising voting rights by the FCA’s Listing

Rules or the City Code on Takeovers

andMergers.

Directors’ interests in shares

The below interests include those held by

connected persons and interests in shares

through the Company’s share schemes.

Number of shares

31 December

2025

31 December

2024

Ian McLaughlin 2,541,802 1,895,865

Dave Watts 1 ,134,712 704,893

Sir Peter Estlin

300,000 300,000

Paul Hewitt

106,502 106,502

Jackie Noakes — —

Karen Briggs — —

Oliver Laird 13,900 26,900

Angela Knight

— —

Graham Lindsay 65,405 65,405

Michele Greene — —

1 Shareholding includes 50,000 shares held by a

connectedperson.

2 Paul Hewitt and Angela Knight stepped down from the Board

on 29 January 2025.

Between 31 December 2025 and 17 February

2026, being the latest practicable date prior

topublication, there has been a change to

DaveWatts’ shares of 310 owned outright due

to Buy as you Earn. There have been no further

changes in any other of the directors’ interests

inthe period.

Dividend waiver

Information on dividend waivers currently

inplace can be found overleaf.

Substantial shareholdings

In accordance with the Disclosure Guidance and Transparency Rules (DTR 5), the Company has

beennotified that the following persons hold directly or indirectly 3% or more of the voting rights

ofthe Company:

Interests as at 31 December 2025

Holders (descending %)

Interests as at 18/02/2026 (being the latest practicable

date before publication of the report)

Holders (descending %)

Redwood Capital Management LLC 13.45% Redwood Capital Management 13.45%

Schroders Investment Management 13.17% Schroders Investment Management 12.83%

Artemis Investment Management 9.44% Artemis Investment Management 9.46%

Janus Henderson Investors 5.79% Janus Henderson Investors 5.79%

Norges Bank Investment Management 4.50% Stichting Value Partners 4.36%

Harwood Capital LLP 3.90% Harwood Capital LLP 3.90%

Stichting Value Partners 3.82% Norges Bank Investment Management 3.78%

All interests disclosed to the Company in accordance with DTR 5 that have occurred since 18/02/26

can be found on the Group’s website: www.vanquis.com.

Directors’ Report continued

125 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Profit and dividends

The Group delivered a profit before tax from

continuing operations of £8.3m (2024: loss of

£138m). As at the date of this report, the

directors have declared dividends as follows:

Ordinary shares (p per share)

Interim dividend

2025 £nil

2024 £nil

Proposed final dividend

2025 £nil

2024 £nil

Total ordinary dividend

2025 £nil

2024 £nil

All-employee share schemes

The current schemes for employees resident in

the UK are the Vanquis Banking Group Savings-

Related Share Option Scheme 2022 (SAYE) and

the Vanquis Banking Group Share Incentive Plan

2022 (SIP). Share schemes are a long-established

and successful part of the total reward package

offered by the Company, encouraging and

supporting employee share ownership. The

Company’s schemes aim to encourage

employees’ involvement and interest in the

financial performance and success of the Group

through share ownership. The Company’s SIP

offers employees the opportunity to further

invest in the Company and to benefit from the

Company’s offer to match that investment on

the basis of one matching share for every four

partnership shares purchased.

Scheme title

Total

participants

as at

31 December

2025

Total

participants

as at

31 December

2024

SAYE 453 284

SIP 141 133

Executive share incentive schemes

Awards are also outstanding under the RSP, LTIS

and DBP. DBP awards were not granted during

the year as no bonus was paid for 2024. RSP

options were granted under the RSP on 9th

September 2025. Further information is set out

on pages 112 and 113.

Vanquis Banking Group 2007

Employee Benefit Trust (EBT)

The EBT, a discretionary trust for the benefit

ofexecutive directors and employees, was

established in 2007. The trustee, JTC Trust

Company (CI) Limited, is not a subsidiary ofthe

Company. The EBT operates in conjunction with

the LTIS, RSP, and DBP and either purchases

shares in the market or subscribes forthe issue

of new shares. The EBT is funded byloans from

the Company which are then used to acquire,

either via market purchase or subscription,

ordinary shares to satisfy awards granted

underthe LTIS, RSP and DBP.

For the purpose of the financial statements,

theEBT is consolidated into the Company and

Group. As a consequence, the loans are

eliminated and the cost of the shares acquired

isdeducted from equity as set out in note 31 on

page 187 of the financial statements. In 2025,

the EBT agreed to satisfy awards granted during

the year under the RSP in relation to options

over 2,920,840 shares in the Company.

As at 31 December 2025, the EBT held the

non-beneficial interest in 6,161,954 shares in the

Company (2024: 1,020,669). The EBT may exercise

or refrain from exercising any voting rights in its

absolute discretion and is not obliged to exercise

such voting rights in a manner requested by

thebeneficiaries. The EBT waives its right to

dividends in relation to shares held in the trust.

Provident Financial Employee

Benefit Trust (the PF Trust)

The PF Trust, a discretionary trust for the benefit

of executive directors and employees, was

established in 2003 and operated in conjunction

with the PSP. The trustee, Provident Financial

Trustees (Performance Share Plan) Limited, is a

subsidiary of the Company. The PF Trust has not

been operated with the Performance Share Plan

(PSP) since 2012, when the previous PSP expired.

The PF Trust was wound up in 2024, and the

trustee, Provident Financial Trustees

(Performance Share Plan) Limited, was

dissolvedon 9th April 2025.

Vanquis Banking Group BAYE Trust

(theBAYETrust)

The BAYE Trust is a discretionary trust that was

established in 2013 to operate in conjunction

with the SIP. Equiniti Share Plan Trustee is trustee

of the BAYE Trust. It is not a subsidiary of the

Company. The BAYE Trust is funded by loans from

the Company which are then used to acquire

ordinary shares via market purchase tosatisfy

the Matching Awards for participants of the SIP.

For the purposes of the financial statements,

theBAYE Trust is consolidated into the Company

and Group. Participants in the SIP can direct

thetrustee on how to exercise its voting rights

inrespect of the shares it holds on behalf of the

participant. As at 31 December 2025, the BAYE

Trust held the non-beneficial interest in 454,226

shares (2024: 384,809 shares).

Colleague engagement and

investing inourworkforce

We invest in our colleagues through recognition,

reward, development, wellbeing, the working

environment and culture. Colleagues are

recognised through our ‘Way to Go’ recognition

platform and our ‘Perks at Work’ scheme, where

you can recognise colleagues for outstanding

work, providing support and generally exhibiting

behaviours that show they are demonstrating

the Vanquis Way, the Group’s values. The site

can be used to learn new hobbies and skills

through the Perks Community Online Academy

and save money on a wide range of expenses.

During 2025 the Company introduced further

perks including workations, which allows

colleagues to combine travel abroad for leisure

purposes with working, paid birthday leave, paid

carer’s leave and dental insurance. TheCompany

launched the ‘Culture Makers’ campaign to

recognise colleagues who embody the Vanquis

values and shape the culture; 21 colleagues were

recognised as culture makers from a total pool

of143 colleagues.

We have a learning and development hub, which

provides colleagues with an online portal to

enhance their skills, performance and career.

Colleagues are also provided access to LinkedIn

Learning, which helps to support the building of

softer and technical skills.

We have a Group reward framework that enables

clear career progression and movement around

the Group. We have established mechanisms

forcolleague engagement, which includes a

Designated Non-Executive Colleague Champion,

a Colleague Forum, ‘Stay Connected’ and the

GPTW survey (see pages 28, 29, 73 and 74).

Directors’ Report continued

126 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Directors’ Report continued

Colleague engagement and

investing inourworkforce continued

Information relevant to how we invest in our

colleagues and where it can be found:

Information Location

Reward and recognition 95 and 118

Learning and development –

management programmes,

apprenticeships, mandatory

e-learning and mentoring

19 and 74

Culture – equal opportunities, gender

diversity, other diversity and inclusion

and Colleague Survey results

5, 8, 28 to

29, 64, 73,

74 and 85

Health and wellbeing – support

andinitiatives

73 and 85

Engagement – internal

communication, Colleague Survey,

workforce panels and Designated

Non-Executive Colleague Champion

19, 21, 22,

24, 25, 28,

29, 73

and74

Equal opportunities and diversity

The Group is committed to employment policies

that follow best practice, based on equal

opportunities for all colleagues irrespective of

gender, pregnancy, race, colour, nationality,

ethnic or national origin, disability, sexual

orientation, age, marital or civil partner status,

gender reassignment, religion or belief. The

Group gives full and fair consideration to

applications for employment from disabled

persons, having regard to their aptitudes and

abilities. To read about our approach to

diversity and inclusion see pages 28 to 29.

Vanquis Banking Group plc is a member of the

Government’s Disability Confident Scheme for

employers. Appropriate arrangements are made

for the continued employment and training,

career development and promotion of disabled

persons employed by the Group, including

making reasonable adjustments where required.

If a member of staff becomes disabled, every

effort is made by the Group to ensure their

continued employment, either in the same or an

alternative position, with appropriate retraining

being given if necessary.

Pensions

The Group operates two pension schemes in the

UK. Employee involvement in the Group defined

benefit pension scheme is achieved by the

appointment of member-nominated trustees

and by regular newsletters and communications

from the trustees to members. In addition, there

is a website dedicated to pension matters. The

trustees manage the assets of the defined

benefit pension scheme, which are held under

trust separately from the assets of the Group.

Each trustee is encouraged to undertake

training, and regular training sessions on current

issues are carried out at meetings of the trustees

by the trustees’ advisors. The trustees have a

business plan and, at the start of each year,

review performance against the plan and

objectives from the previous year. In addition,

they agree objectives and a budget for the

current year. The trustees have a risk register

and an associated action plan and a Conflicts

of Interest Policy, both of which are reviewed at

least annually. The trustees have implemented

ade-risking investment strategy, which has been

agreed with the Company and is kept under

close review. The objective of the strategy is

toreduce the risk that the assets would be

insufficient in the future to meet the liabilities

ofthe scheme. The Company has put Pension

Trustee Indemnity Insurance in place to cover all

the Group’s pension schemes where individuals

act as trustees. The trustees are also protected

by an indemnity within each scheme’s rules and

this insurance effectively protects the Group

against the cost of potential claims impacting

on the solvency of the pension schemes. The

Group operates a Group Personal Pension Plan

for employees who joined the Group from

1January 2003. Employees in both these

planshave access to websites that provide

information about their funds and general

information about the plan.

Compliance

The Risk and Audit Committees oversee

compliance and work together to review

thesystems and controls for the prevention

ofbribery.

Health and safety (H&S)

The Group remains dedicated to upholding

rigorous health and safety standards across

allworking environments for our colleagues,

contractors, suppliers, and visitors. The Group

continues to place the highest priority on health,

safety, and wellbeing by clearly defining roles,

responsibilities, and delegated authority to

ensure effective management. During 2025, high

levels of assurance in our health and safety

performance have been achieved with ongoing

improvement remaining an essential component

of our health and safety strategy. The Group

has maintained strong focus on health and

safety training, achieving excellent compliance

and empowering colleagues to proactively

identify and address risks. This commitment

wasfurther demonstrated through robust risk

management throughout the year. Continued

tailored health and safety support has

continued for our hybrid working approach.

Significant activity was undertaken in support

ofour Bradford office move, and numerous

initiatives were launched to foster a more

inclusive, safe, and supportive workplace for all.

In the last quarter, the roll-out of DSE (Display

Screen Equipment) training and risk assessments

have commenced, as a fundamental part of

protecting colleagues’ health and wellbeing.

Anti-bribery and corruption

The Group has a policy on anti-bribery and

corruption, which reflects the requirements of the

Bribery Act 2010.

The policy sets out the Group’s zero-tolerance

approach to bribery and corruption and its

commitment to acting professionally, fairly and

with integrity in all its business dealings and

relationships, wherever it operates, and

implementing and enforcing effective systems

and controls to counter bribery and corruption.

The policy applies to all employees, contractors

and directors in relation to the business activities

undertaken by, or on behalf of, the Group. It also

applies to any third party that is undertaking

business for, or on behalf of the Group, which

must comply with the policy or maintain

equivalent standards and safeguards to prevent

bribery and corruption. Under the policy, all

employees, contractors, directors and relevant

third parties of the Group and its divisions must

comply with the following minimum requirements:

5 they must not directly or indirectly engage

inbribery or corruption in any form; and

5 they also must not accept, solicit, agree

toreceive, promise, offer or give a bribe,

orfacilitate payment, kickback or other

improper payment.

The policy also states that if an employee,

contractor, director or relevant third party of the

Group or its divisions becomes aware of a breach

of the above minimum requirements, they must

immediately comply with applicable reporting

protocols and procedures. The Group MLRO is the

responsible person within the Group for receiving

reports. The Group provides anti-bribery and

corruption training to all colleagues on an

annualbasis.

127 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Directors’ Report continued

Related policies

Gifts and Corporate Hospitality Policy

The Group has a Gifts and Corporate Hospitality

Policy, which sets out the requirements for the

review, approval and documentation of any

gifts or corporate hospitality that are accepted,

offered or provided. The Risk Committee

oversees the Gifts and Corporate

HospitalityPolicy.

Whistleblowing Policy

The Group has a Whistleblowing Policy,

whichisoverseen by the Board. The Group is

committed to fostering a culture of openness,

honesty and accountability and requires the

highest possible standards of professional and

ethical conduct. Should any Group colleagues

have any reportable concerns, these can be

raised anonymously either internally or through

the Group’s external third-party helpline facility

asdetailed in the Group Whistleblowing Policy.

The Group has appointed a Whistleblowing

Champion, being a non-executive director

withresponsibility for ensuring and overseeing

the integrity of the Group’s arrangements on

whistleblowing, including policies and procedures.

A Group Whistleblowing Forum is in place,

whichreviews management information on

whistleblowing disclosures and grievances and

agrees on escalations to the Board. It also

considers any concerns regarding persistent

trends and shares best practice. The Group

provides whistleblowing training to all

colleagues, including executive directors.

Overseas branches

The Group has no overseas branches.

Political donations

The Group neither made any political donations

nor incurred any political expenditure during

theyear.

Research and development

The Group’s research and development activities

have predominantly related to the Gateway

technology transformation and the launch of

new product variants as set out in note 20 on

page 171 of the financial statements.

Environment and greenhouse

gasemissions

The Group’s greenhouse gas (GHG) and energy

use reporting is undertaken in accordance with

our obligations under both the Companies Act

2006 (Strategic Report and Directors’ Report)

Regulations 2013 and the UK Government’s

Streamlined Energy and Carbon Reporting

(SECR) Policy that has been implemented

through the Companies (Directors’ Report) and

Limited Liability Partnership (Energy and Carbon

Report) Regulations 2018. These emissions are

reported in accordance with WRI/WBCSD

GHGProtocol. For more information, please

referto pages 33 to 43.

The Group’s total GHG emissions, in tonnes of

equivalent (CO

e), along with details of our

energy use and an intensity ratio, are reported

in the table on page 42. SLR Consulting Limited

has provided limited level ISAE 3000 (Revised)

assurance in respect of this data. Its full,

independent assurance statement is available

online at: www.vanquis.com/sustainability.

Where challenges have occurred in obtaining

data, estimates have been used and assured

bySLR Consulting.

The Group’s Climate Risk Committee, which is

co-chaired by the Group Treasurer and Head of

Strategic Planning and Analysis, and includes

senior representatives from functions such as

Finance, Risk, Operations and Sustainability,

continues to support the business to assess,

manage and report material climate-related

risks and opportunities, and ensure that we

continue to meet the recommendations of the

Task Force on Climate-related Financial

Disclosures (TCFD). This is done through the

production of a climate-related financial

disclosure that is structured in such a way that

that it is fully consistent with the four pillars and

11 recommended disclosures of the TCFD, and

therefore meets the requirements of the

Climate-related Financial Disclosure (CFD)

Regulations 2022 and the UK Companies Act

(that is, sections 414CB(2A)(a to h)). The Group’s

2025 climate-related financial disclosure is set

out on pages 33 to 43.

To help us to manage and reduce our wider

impacts on the environment, the Group

continues to have in place an Environmental

Management System (EMS). Our EMS helps us to

identify, assess and reduce key environmental

risks and impacts; set and deliver against

environmental targets; and ensure our legal

compliance. This EMS is independently audited

each year against the requirements of the

international management standard ISO

14001:2015. Following the environmental audits

carried out in 2025, all the Group’s business

premises in Bradford, London, Chatham in Kent

and Petersfield in Hampshire were re-certified to

comply with the international standard

ISO14001:2015.

Important events since the

endofthe financial year

(31December 2025)

See note 37 on page 194.

Financial instruments

Details of the financial risk management

objectives and policies of the Group and the

exposure of the Group to credit risk, liquidity risk

and market risk are included on pages 152 to

154 of the financial statements.

Significant agreements

There are no agreements between any Group

company and any of its employees or any

director of any Group company that provide for

compensation to be paid to an employee or a

director on termination of employment or for

loss of office as a consequence of a takeover

ofthe Company.

Directors’ responsibilities

The directors are responsible for preparing the

Annual Report and the financial statements in

accordance with applicable law and regulations.

The directors have chosen to prepare both the

Group and parent company financial statements

under UK adopted International Accounting

Standards. Under company law, the directors

must not approve the financial statements

unless they are satisfied that they give a true

and fair view of the state of affairs of the

Company and of the profit or loss of the

Company for that period.

In preparing these financial statements,

International Accounting Standard 1 requires

that directors:

5 properly select and apply accounting policies;

5 present information, including accounting

policies, in a manner that provides relevant,

reliable, comparable and understandable

information;

5 provide additional disclosures when

compliance with the specific requirements

ofthe financial reporting framework is

insufficient to enable users to understand

the impact of particular transactions, other

events and conditions on the entity’s financial

position and financial performance; and

5 make an assessment of the Company’s

ability to continue as a going concern.

128 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Directors’ Report continued

Directors’ responsibilities continued

The directors are responsible for keeping

adequate accounting records that are sufficient

to show and explain the Company’s transactions

and disclose with reasonable accuracy at any

time the financial position of the Company and

enable them to ensure that the financial

statements comply with the Companies Act

2006. They are also responsible for safeguarding

the assets of the Company and hence for taking

reasonable steps for the prevention and

detection of fraud and other irregularities.

The directors are responsible for the maintenance

and integrity of the corporate and financial

information included on the Company’s website.

Legislation in the UK governing the preparation

and dissemination of financial statements may

differ from legislation in other jurisdictions.

Directors’ responsibility statement

We confirm that to the best of our knowledge:

5 the financial statements, prepared in

accordance with the relevant financial

reporting framework, give a true and fair

view of the assets, liabilities, financial

position and profit or loss of the Company

and the undertakings included in the

consolidation taken as a whole;

5 the Strategic Report includes a fair review

ofthe development and performance of the

business and the position of the Company

and the undertakings included in the

consolidation taken as a whole, together

with a description of the principal risks

anduncertainties that they face; and

5 the Annual Report and financial statements,

taken as a whole, is fair, balanced and

understandable and provides the information

necessary for shareholders to assess the

Company’s position, performance, business

model and strategy.

The directors are also required by the FCA’s

Disclosure Guidance and Transparency Rules

(DTR) to include a management report containing

a fair review of the business of the Group and

the Company and a description of the principal

risks, emerging risks and uncertainties facing

theGroup and Company.

The Directors’ Report and the Strategic Report

constitute the management report for the

purposes of DTR 4.1.5R and DTR 4.1.8R. The

directors are responsible for keeping proper

accounting records that are sufficient to:

5 show and explain the Company’s

transactions;

5 disclose with reasonable accuracy at any

time the financial position of the Company

and Group; and

5 enable them to ensure that the financial

statements and the Directors’ Remuneration

Report comply with the Act and, as regards

the Group financial statements, Article 4 of

the IAS Regulation. They are also

responsible for safeguarding the assets of

the Company and the Group and taking

reasonable steps for the prevention and

detection of fraud and other irregularities.

The Annual Report and financial statements

2025 will be published on the Group’s website

inaddition to the paper version.

The directors are responsible for the maintenance

and integrity of the Group’s website. Legislation

in the UK governing the preparation and

dissemination of financial statements may differ

from legislation in other jurisdictions.

Responsibility statement

Company law requires the directors to prepare

financial statements for each financial year.

Under that law the directors are required to

prepare the Group financial statements in

accordance with relevant IFRS and IFRIC

interpretations and the Companies Act 2006.

The directors who held office during the financial

year and to the date of this report were

asfollows:

Sir Peter Estlin Chairman

Ian McLaughlin Chief Executive Officer

Dave Watts Chief Financial Officer

Michele Greene Senior Independent

Non-Executive Director

Graham Lindsay Independent

Non-Executive Director

Karen Briggs Independent

Non-Executive Director

Oliver Laird Independent

Non-Executive Director

Jackie Noakes Independent

Non-Executive Director

Paul Hewitt Stepped down

29January 2025

Angela Knight Stepped down

29January 2025

Disclosure of information to auditor

In accordance with section 418 of the Act, each

person who is a director as at the date of this

report confirms that:

5 so far as they are aware, there is no relevant

audit information of which the Company’s

external auditor is unaware; and

5 they have taken all steps that ought to have

been taken as a director in order to make

themselves aware of any relevant audit

information and to establish that the

Company’s external auditor is aware

of that information.

Auditor

Deloitte LLP, the external auditor for the

Company, was first appointed in 2012 and,

following a tender process in 2020, a resolution

proposing its reappointment was passed at the

2025 AGM. The reappointment of Deloitte LLP

asthe Company’s external auditor is proposed

at the 2026 AGM.

2026 AGM

The 2026 AGM will be held at Vanquis head

office, Fairburn House, 5 Godwin Street,

Bradford BD1 2AH, on Wednesday 6th May

at10.00 am. The Notice of AGM, together with

anexplanation of the items of business, will be

contained in the circular to shareholders dated

25 February 2026, and will be available on

ourwebsite, www.vanquis.com.

Approved by the Board on 25 February 2026

and signed by order of the Board.

Michael Mustard

General Counsel and Company Secretary

25 February 2026

129 – Vanquis Banking Group plc Annual Report and Accounts 2025

Financial statements Shareholder informationGovernanceStrategic report

1. Opinion

In our opinion:

5 the financial statements of Vanquis Banking Group plc (the ‘parent company’) and its subsidiaries

(the ‘Group’) give a true and fair view of the state of the group’s and of the parent company’s

affairs as at 31 December 2025 and of the Group’s profit for the year then ended;

5 the Group financial statements have been properly prepared in accordance with United Kingdom

adopted international accounting standards;

5 the parent company financial statements have been properly prepared in accordance with

United Kingdom adopted international accounting standards and as applied in accordance with

the provisions of the Companies Act 2006; and

5 the financial statements have been prepared in accordance with the requirements of the

Companies Act 2006.

We have audited the financial statements which comprise:

5 the consolidated income statement;

5 the consolidated statement of comprehensive income;

5 the consolidated and parent company balance sheets;

5 the consolidated and parent company statements of changes in equity;

5 the consolidated and parent company cash flow statements;

5 the material accounting policy information; and

5 the related notes 1 to 38.

The financial reporting framework that has been applied in their preparation is applicable law and

United Kingdom adopted international accounting standards and, as regards the parent company

financial statements, as applied in accordance with the provisions of the Companies Act 2006.

2. Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and

applicable law. Our responsibilities under those standards are further described in the auditor’s

responsibilities for the audit of the financial statements section of our report.

We are independent of the Group and the parent company in accordance with the ethical requirements

that are relevant to our audit of the financial statements in the UK, including the Financial Reporting

Council’s (the ‘FRC’s’) Ethical Standard as applied to listed public interest entities, and we have fulfilled

our other ethical responsibilities in accordance with these requirements. The non-audit services provided

to the Group and parent company for the year are disclosed in note 6 to the financial statements. We

confirm that we have not provided any non-audit services prohibited by the FRC’s Ethical Standard to

the Group or the parent company.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis

for our opinion.

3. Summary of our audit approach

Key audit matters

The key audit matter that we identified in

thecurrent year was the estimation of

expectedcredit losses in Credit Cards

andVehicle Finance.

Within this report, key audit matters

areidentified as follows:

Newly identified

Increased level of risk

Similar level of risk

Decreased level of risk

Materiality

The materiality that we used for the Group and parent company financial statements was

£4.34m and £4.12m respectively which was determined on the basis of approximately 1% of

net assets, with the parent company materiality being capped at 95% of Group materiality.

Scoping

The Group has four operating segments, being Credit Cards, Second Charge Mortgages,

Vehicle Finance and Corporate Centre. In addition, the Personal Loans operating segment

was discontinued in the year following the sale of the loan portfolio and is recognised as

adiscontinued operation in the current year.

Our Group audit scope focused on Credit Cards, Second Charge Mortgages and Vehicle

Finance, which, together with the parent and corporate centre entities, account for 100%

ofthe Group’s net assets.

Significant changes

in our approach

In the prior year, the appropriateness of the contingent liability for Vehicle Finance

Commissions was identified as a key audit matter. This was due to the high degree of

estimation uncertainty and judgement involved, resulting from the Court of Appeal ruling,

over whether a provision or contingent liability should be recognised.

In the current year, following the Financial Conduct Authority’s (FCA) consultation on the

motor finance commission redress scheme issued in October 2025, management has

recognised a provision of £3m as disclosed in note 26. As a result, Vehicle Finance

Commissions is not considered to be a key audit matter.

Independent auditor’s report to the members of Vanquis Banking Group plc

Report on the audit of the financial statements

130 – Vanquis Banking Group plc Annual Report and Accounts 2025

Financial statements Shareholder informationGovernanceStrategic report

4. Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors’ use of the going concern

basis of accounting in the preparation of the financial statements is appropriate.

Our evaluation of the directors’ assessment of the Group’s and parent company’s ability to continue

to adopt the going concern basis of accounting included:

5 obtaining an understanding of relevant controls around management’s going concern assessment;

5 assessing the reasonableness of key assumptions, such as cash flows, capital, and liquidity

usedin the forecasts used to inform management’s going concern assessment, including the

effect of current and forecast macro-economic conditions, and any implications of the

transformation strategy;

5 reviewing regulatory correspondence and key committee and board meeting minutes to identify

events or conditions that may affect the Group’s ability to continue as a going concern;

5 assessing the information supporting the liquidity and capital forecasts, with support from our

prudential regulation specialists, including the stress testing and reverse stress testing performed

by management;

5 assessing the historical accuracy of forecasts prepared by management by comparing these to

actual results; and

5 assessing the appropriateness of the disclosures in respect of going concern.

Based on the work we have performed, we have not identified any material uncertainties relating to

events or conditions that, individually or collectively, may cast significant doubt on the Group’s and

parent company’s ability to continue as a going concern for a period of at least twelve months from

when the financial statements are authorised for issue.

In relation to the reporting on how the Group has applied the UK Corporate Governance Code,

wehave nothing material to add or draw attention to in relation to the directors’ statement in the

financial statements about whether the directors considered it appropriate to adopt the going

concern basis of accounting.

Our responsibilities and the responsibilities of the directors with respect to going concern are

described in the relevant sections of this report.

5. Key audit matters

Key audit matters are those matters that, in our professional judgement, were of most significance in

our audit of the financial statements of the current period and include the most significant assessed

risks of material misstatement (whether or not due to fraud) that we identified. These matters included

those which had the greatest effect on: the overall audit strategy; the allocation of resources in the

audit; and directing the efforts of the engagement team.

These matters were addressed in the context of our audit of the financial statements as a whole,

andin forming our opinion thereon, and we do not provide a separate opinion on these matters.

5.1. Estimation of expected credit losses in Credit Cards and Vehicle Finance

Key audit matter

description

IFRS 9 Financial Instruments, requires that an impairment assessment should be the best

estimate of expected credit losses, and that reasonable forward-looking information should

be incorporated into the calculation as at the balance sheet date. The expected credit loss

provision estimate is driven by account-specific estimation of probability of default (‘PD’),

loss given default (‘LGD’) and exposure at default (‘EAD’) which represent the key areas

ofjudgement.

The Group holds portfolios of receivables from credit card, second charge mortgages and

vehicle financing arrangements, totalling £2,691.5m (2024: £2,154.6m), net of the expected

credit loss provision. The Group’s provision for impairment against amounts receivable from

customers is £244.7m (2024: £261.8m). We have pinpointed our key audit matter to two

specific areas that require significant judgement in Credit Cards and Vehicle Finance:

5 Macroeconomic scenarios: The uncertainties in the macroeconomic environment mean

there exists a wide range of scenarios with different loss outcomes. There is significant

judgement in determining the probability weighting of the scenarios adopted by

management and the macroeconomic forecast and

5 Economic Response Model: Management has redeveloped the economic response model

in the current year which is used to generate an appropriate response to the change in

the macroeconomic scenarios. This involves significant judgements in relation to the

redeveloped methodology and underlying assumptions.

Given the material impact of the significant judgements involved, we also consider there is a

risk of potential fraud due to the potential ability of management to introduce inappropriate

bias to judgements made in the estimation process.

Further detail in respect of these is set out in the material accounting policy information,

including the critical accounting judgements and key sources of estimation uncertainty on

page 148 to 150, the amounts receivables from customers in note 14 of the financial

statements and also within the Audit Committee report in page 90.

Independent auditor’s report to the members of Vanquis Banking Group plc continued

Report on the audit of the financial statements continued

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6. Our application of materiality

6.1. Materiality

We define materiality as the magnitude of misstatement in the financial statements that makes

itprobable that the economic decisions of a reasonably knowledgeable person would be changed

or influenced. We use materiality both in planning the scope of our audit work and in evaluating the

results of our work.

Based on our professional judgement, we determined materiality for the financial statements as a

whole as follows:

Group financial statements Parent company financial statements

Materiality

£4.34m (2024: £4.41m) £4.12m (2024: £4.19m)

Basis for

determining

materiality

Approximately 1% of net assets (2024: 1% of

net assets)

Approximately 1% of net assets capped at

95% of Group materiality (2024: 1% of net

assets capped at 95% of Group materiality)

Rationale for the

benchmark applied

Our benchmark upon which materiality is determined is consistent with the prior period.

Wedetermined that net assets continue to be a more stable and relevant measure used

byinvestors, regulators and stakeholders when assessing the performance and longer-term

prospects of the Group and parent company as well as the importance of net assets to the

Group’s regulatory capital position.

5. Key audit matters continued

5.1. Estimation of expected credit losses in Credit Cards and Vehicle Finance continued

How the scope

ofour audit

responded to the

key audit matter

We performed the following procedures over the key audit matter:

5 Obtained an understanding of the relevant controls over model governance, including

development, recalibration, and monitoring activities and review and challenge of the

year-end macro-economic scenarios;

5 With support from our credit risk modelling specialists, assessed whether the Economic

Response Model development was based on appropriate data, considering the build

period, data sampling, and exclusions applied;

5 Performed an independent recode of the Economic Response Model to test its accuracy;

5 With support from our economics specialists, challenged and evaluated economic

forecasts and their respective weightings through comparison to independent economic

outlooks, other external and market data; and

5 Conducted an overall stand back assessment, which in conjunction with our direct

procedures on this key audit matter, specifically involved benchmarking management’s

macroeconomic scenario forecasts against market data, to consider whether sufficient

appropriate audit evidence had been obtained.

Key observations

We considered the redevelopment of the Economic Response Model and the associated

forward looking macroeconomic assumptions to be appropriate.

Independent auditor’s report to the members of Vanquis Banking Group plc continued

Group materiality

£4.34m

Net assets

£487.30m

Component performance

materiality range

£1.11m to £2.68m

Audit Committee

reporting threshold

£0.22m

Net assets Group materiality

Report on the audit of the financial statements continued

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7. An overview of the scope of our audit

7.1. Identification and scoping of components

The Group has four operating segments in the current year being: Credit Cards, Second Charge

Mortgages, Vehicle Finance and Corporate Centre. The Corporate Centre includes Snoop, Operations,

Technology & Change, and support Functions which collectively serve the needs of the wider Group.

Our Group audit was scoped by obtaining an understanding of the Group and its environment,

including Group-wide controls, and assessing the risks of material misstatement at the Group level.

Our Group audit scope focused on all the operating segments which account for 100% of the Group’s

net assets and are all led by the Group audit engagement partner.

7.2. Our consideration of the control environment

We identified the financial reporting, lending, and deposit business cycles as the most relevant to the

audit, including the identification, valuation and recording of expected credit losses. Due to continuing

control deficiencies including those relating to the legacy IT systems, we only planned and successfully

executed a controls reliance approach for a segment of retail deposits. The known control issues

within the legacy IT systems are expected to be fixed strategically through the IT platform

modernisation This has been discussed within the Audit Committee Report set out on page 88.

7.3. Our consideration of climate-related risks

In planning our audit, we have considered the potential impact of climate change on the Group’s

business and its financial statements.

The Group continues to develop its assessment of the potential impacts of climate change which is

currently being considered over the short term (zero to one year), medium term (one to five years)

andlong term (five or more years) time horizons within the strategic report on page 34.

As part of our audit, we have obtained management’s climate-related risk assessment and held

enquiries with the Head of Sustainability, the Chief Risk Officer and Finance team to understand the

process of identifying climate-related risks, the determination of mitigating actions and the impact on

the Group’s financial statements. Management has identified there to be no material impact arising

from climate change on the judgements and estimates made in the financial statements as explained

in the material accounting policy information disclosure on page 148.

We performed our own qualitative risk assessment of the potential impact of climate change

materialmisstatement. Our procedures included reading disclosures included in the Strategic Report

with the involvement of our climate change and sustainability specialists and audit team consideration

as to whether they are materially consistent with the financial statements and our knowledge

obtained in the audit. We also evaluated whether appropriate disclosures have been made

inthefinancial statements.

6. Our application of materiality continued

6.2. Performance materiality

We set performance materiality at a level lower than materiality to reduce the probability that,

inaggregate, uncorrected and undetected misstatements exceed the materiality for the financial

statements as a whole.

Group financial statements Parent company financial statements

Performance

materiality

65% (2024: 65%) of Group materiality 65% (2024: 65%) of parent company materiality

Basis and rationale

for determining

performance

materiality

In determining performance materiality, we considered a number of factors, including: our

understanding of the control environment and controls reliance obtained, our understanding

of the business, and the number of uncorrected misstatements identified in the prior year.

We have assessed the performance materiality threshold to 65% of materiality in the current

year to incorporate the broader control environment and the continuing controls issues

identified by our IT specialists which prevented us from taking a controls reliance approach

(see section 7.2 of our report).

6.3. Error reporting threshold

We agreed with the Audit Committee that we would report to the Committee all audit differences in

excess of £0.22m (2024: £0.22m), as well as differences below that threshold that, in our view,

warranted reporting on qualitative grounds. We also report to the Audit Committee on disclosure

matters that we identified when assessing the overall presentation of the financial statements.

Independent auditor’s report to the members of Vanquis Banking Group plc continued

Report on the audit of the financial statements continued

133 – Vanquis Banking Group plc Annual Report and Accounts 2025

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10. Auditor’s responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole

are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report

that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee

that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement

when it exists. Misstatements can arise from fraud or error and are considered material if, individually

or in the aggregate, they could reasonably be expected to influence the economic decisions of users

taken on the basis of these financial statements.

A further description of our responsibilities for the audit of the financial statements is located on

theFRC’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our

auditor’s report.

11. Extent to which the audit was considered capable of detecting

irregularities, including fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design

procedures in line with our responsibilities, outlined above, to detect material misstatements in respect

of irregularities, including fraud. The extent to which our procedures are capable of detecting

irregularities, including fraud is detailed below.

11.1. Identifying and assessing potential risks related to irregularities

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud

and non-compliance with laws and regulations, we considered the following:

5 the nature of the industry and sector, control environment and business performance including

the design of the Group’s remuneration policies, key drivers for directors’ remuneration, bonus

levels and performance targets;

5 the Group’s own assessment of the risks that irregularities may occur either as a result of fraud

or error that was approved by the board;

5 results of our enquiries of management, internal audit, the directors and the audit committee

about their own identification and assessment of the risks of irregularities, including those that

are specific to the Group’s sector;

5 any matters we identified having obtained and reviewed the Group’s documentation of their

policies and procedures relating to:

5 identifying, evaluating and complying with laws and regulations and whether they were

aware of any instances of non-compliance;

5 detecting and responding to the risks of fraud and whether they have knowledge of any

actual, suspected or alleged fraud;

5 the internal controls established to mitigate risks of fraud or non-compliance with laws

andregulations;

8. Other information

The other information comprises the information included in the annual report, other than the

financial statements and our auditor’s report thereon. The directors are responsible for the other

information contained within the annual report.

Our opinion on the financial statements does not cover the other information and, except to the extent

otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

Our responsibility is to read the other information and, in doing so, consider whether the other

information is materially inconsistent with the financial statements or our knowledge obtained in the

course of the audit, or otherwise appears to be materially misstated.

If we identify such material inconsistencies or apparent material misstatements, we are required to

determine whether this gives rise to a material misstatement in the financial statements themselves.

If,based on the work we have performed, we conclude that there is a material misstatement of this

other information, we are required to report that fact.

We have nothing to report in this regard.

9. Responsibilities of directors

As explained more fully in the directors’ responsibilities statement, the directors are responsible for

the preparation of the financial statements and for being satisfied that they give a true and fair view,

and for such internal control as the directors determine is necessary to enable the preparation of

financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the Group’s and the

parent company’s ability to continue as a going concern, disclosing as applicable, matters related to

going concern and using the going concern basis of accounting unless the directors either intend to

liquidate the Group or the parent company or to cease operations, or have no realistic alternative

but to do so.

Independent auditor’s report to the members of Vanquis Banking Group plc continued

Report on the audit of the financial statements continued

134 – Vanquis Banking Group plc Annual Report and Accounts 2025

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11.2. Audit response to risks identified

As a result of performing the above, we identified the estimation of expected credit losses in Credit

Cards and Vehicle Finance as a key audit matter related to the potential risk of fraud. The key audit

matters section of our report explains the matters in more detail and also describes the specific

procedures we performed in response to that key audit matter.

In addition to the above, our procedures to respond to risks identified included the following:

5 reviewing the financial statement disclosures and testing to supporting documentation to assess

compliance with provisions of relevant laws and regulations described as having a direct effect

on the financial statements;

5 enquiring of management, the Audit Committee and in-house legal counsel concerning actual

and potential litigation and claims;

5 performing analytical procedures to identify any unusual or unexpected relationships that may

indicate risks of material misstatement due to fraud;

5 reading minutes of meetings of those charged with governance, reviewing internal audit reports

and reviewing correspondence with Prudential Regulation Authority, the Financial Conduct

Authority and HMRC;

5 in addressing the risk of fraud through management override of controls, testing the

appropriateness of journal entries and other adjustments; assessing whether the judgements

made in making accounting estimates are indicative of a potential bias; and evaluating the

business rationale of any significant transactions that are unusual or outside the normal course

of business.

We also communicated relevant identified laws and regulations and potential fraud risks to all

engagement team members including internal specialists, and remained alert to any indications of

fraud or non-compliance with laws and regulations throughout the audit.

11. Extent to which the audit was considered capable of detecting

irregularities, including fraud continued

11.1. Identifying and assessing potential risks related to irregularities continued

5 the matters discussed among the audit engagement team and relevant internal specialists,

including tax, valuations, pensions, financial instruments, share-based payments, data analytics,

information technology, prudential regulatory, conduct risk and regulatory, climate change and

sustainability, macroeconomic and credit risk modelling specialists, regarding how and where

fraud might occur in the financial statements and any potential indicators of fraud.

As a result of these procedures, we considered the opportunities and incentives that may exist within

the organisation for fraud and identified the greatest potential for fraud in the estimation of expected

credit losses in Credit Cards and Vehicle Finance. In common with all audits under ISAs (UK), we are

also required to perform specific procedures to respond to the risk of management override.

We also obtained an understanding of the legal and regulatory frameworks that the Group operates

in, focusing on provisions of those laws and regulations that had a direct effect on the determination

of material amounts and disclosures in the financial statements. The key laws and regulations we

considered in this context included the UK Companies Act, Listing Rules, pensions legislation,

taxlegislation.

In addition, we considered provisions of other laws and regulations that do not have a direct effect

on the financial statements but compliance with which may be fundamental to the Group’s ability to

operate or to avoid a material penalty. These included the regulation set by the Financial Conduct

Authority and the Prudential Regulation Authority relating to the Group’s regulatory capital and

liquidity requirements.

Independent auditor’s report to the members of Vanquis Banking Group plc continued

Report on the audit of the financial statements continued

135 – Vanquis Banking Group plc Annual Report and Accounts 2025

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14. Opinion on other matter prescribed by the Capital Requirements

(Country-by-Country Reporting) Regulations 2013

In our opinion the information given in note 36 to the financial statements for the financial year

ended 31 December 2025 has been properly prepared, in all material respects, in accordance with the

Capital Requirements (Country-by Country Reporting) Regulations 2013.

15. Matters on which we are required to report by exception

15.1. Adequacy of explanations received and accounting records

Under the Companies Act 2006 we are required to report to you if, in our opinion:

5 we have not received all the information and explanations we require for our audit; or

5 adequate accounting records have not been kept by the parent company, or returns adequate

for our audit have not been received from branches not visited by us; or

5 the parent company financial statements are not in agreement with the accounting records

andreturns.

We have nothing to report in respect of these matters.

15.2. Directors’ remuneration

Under the Companies Act 2006 we are also required to report if in our opinion certain disclosures

ofdirectors’ remuneration have not been made or the part of the directors’ remuneration report

tobe audited is not in agreement with the accounting records and returns.

We have nothing to report in respect of these matters.

12. Opinions on other matters prescribed by the Companies Act 2006

In our opinion the part of the directors’ remuneration report to be audited has been properly

prepared in accordance with the Companies Act 2006.

In our opinion, based on the work undertaken in the course of the audit:

5 the information given in the strategic report and the directors’ report for the financial year for

which the financial statements are prepared is consistent with the financial statements; and

5 the strategic report and the directors’ report have been prepared in accordance with applicable

legal requirements.

In the light of the knowledge and understanding of the Group and the parent company and their

environment obtained in the course of the audit, we have not identified any material misstatements

inthe strategic report or the directors’ report.

13. Corporate Governance Statement

The Listing Rules require us to review the directors’ statement in relation to going concern, longer-term

viability and that part of the Corporate Governance Statement relating to the Group’s compliance

with the provisions of the UK Corporate Governance Code specified for our review.

Based on the work undertaken as part of our audit, we have concluded that each of the following

elements of the Corporate Governance Statement is materially consistent with the financial

statements and our knowledge obtained during the audit:

5 the directors’ statement with regards to the appropriateness of adopting the going concern basis

of accounting and any material uncertainties identified set out on page 142;

5 the directors’ explanation as to its assessment of the Group’s prospects, the period this

assessment covers and why the period is appropriate set out on page 62;

5 the directors’ statement on fair, balanced and understandable set out on page 86;

5 the board’s confirmation that it has carried out a robust assessment of the emerging and

principal risks set out on pages 92 and 93;

5 the section of the annual report that describes the review of effectiveness of risk management

and internal control systems set out on page 93; and

5 the section describing the work of the audit committee set out on pages 86 to 90.

Independent auditor’s report to the members of Vanquis Banking Group plc continued

Report on other legal and regulatory requirements

136 – Vanquis Banking Group plc Annual Report and Accounts 2025

Financial statements Shareholder informationGovernanceStrategic report

16. Other matters which we are required to address

16.1. Auditor tenure

Following the recommendation of the audit committee, we were appointed by the Directors on

30June 2021 to audit the financial statements for the year ended 31 December 2022 and subsequent

financial periods. The period of total uninterrupted engagement including previous renewals and

reappointments of the firm is 14 years, covering the years ending 31 December 2012 to 31 December 2025.

16.2. Consistency of the audit report with the additional report to the audit committee

Our audit opinion is consistent with the additional report to the audit committee we are required to

provide in accordance with ISAs (UK).

17. Use of our report

This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of

Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to

the company’s members those matters we are required to state to them in an auditor’s report and

for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility

to anyone other than the company and the company’s members as a body, for our audit work, for

this report, or for the opinions we have formed.

As required by the Financial Conduct Authority (FCA) Disclosure Guidance and Transparency Rule

(DTR) 4.1.15R – DTR 4.1.18R, these financial statements form part of the Electronic Format Annual

Financial Report filed on the National Storage Mechanism of the FCA in accordance with DTR 4.1.15R

– DTR 4.1.18R. This auditor’s report provides no assurance over whether the Electronic Format Annual

Financial Report has been prepared in compliance with DTR 4.1.15R – DTR 4.1.18R.

Kieren Cooper (Senior statutory auditor)

For and on behalf of Deloitte LLP

Statutory Auditor

Birmingham, United Kingdom

25 February 2026

Independent auditor’s report to the members of Vanquis Banking Group plc continued

Report on other legal and regulatory requirements continued

137 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

		Group
		2025	2024 1
	Note	£m	£m
Interest income	3	56 7.2	549.9
Interest expense	4	(148.8)	(142.0)
Net interest income		4 18.4	40 7.9
Fee and commission income	5	38.3	38.3
Fee and commission expense	5	(2.5)	(1.9)
Net fee and commission income	5	35.8	36.4
Other income		0.7	2.1
Total income		454.9	446.4
Impairment charges	14	(18 1.1)	(185.3)
Risk-adjusted income		27 3.8	26 1.1
Operating costs		(2 6 5.5)	(399.1)
Statutory profit/(loss) before taxation from continuing operations	1, 6	8.3	(138.0)
Tax (charge)/credit from continuing operations	7	(0.3)	17.4
Statutory profit/(loss) after taxation from continuing operations		8.0	(12 0.6)
Profit after taxation from discontinued operations	2	0.7	1.3
Statutory profit/(loss)		8.7	(119.3)
Statutory profit/(loss) attributable to ordinary shareholders		8.2	(119.3)
Statutory profit attributable to other equity holders		0.5	—

1 Refer to material accounting policy information for detail of the representation.

Consolidated income statement

For the year ended 31 December

Consolidated statement of comprehensive income

For the year ended 31 December

		Group
		2025	2024
	Note	£m	£m
Profit/(loss) for the year attributable to equity shareholders		8.2	(119.3)
Items that will not be reclassified subsequently to the income statement:
– actuarial movements on retirement benefit asset	22	(22.1)	(11.6)
– tax on items taken directly to other comprehensive income	7	5.5	2.9
Other comprehensive expense for the year		(16.6)	(8.7)
Total comprehensive expense for the year		(8.4)	(12 8.0)

Earnings per share

For the year ended 31 December

		Group
		2025	2024
	Note	pence	pence
Basic	8	3.2	(46.7)
Diluted	8	3.1	(46.7)

Dividends per share

For the year ended 31 December

		Group
		2025	2024
	Note	pence	pence
Interim dividend	9	—	—
Final dividend	9	—	—

The total cost of dividends paid in the year was £nil (2024: £2.5m).

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		Group		Company
		At	At	At	At
		31 December	31 December	31 December	31 December
		2025	2024	2025	2024
	Note	£m	£m	£m	£m
Assets
Cash and cash equivalents	12	804.5	1,003.9	4.3	10.5
Investment securities	13	254.6	—	—	—
Amounts receivable from customers	14	2,69 1.5	2,153.7	—	—
Trade and other receivables	15	6 1.2	72.5	769.8	768.4
Investments held at fair value through profit and loss	16	2.4	2.3	—	—
Current tax asset		0.9	3.9	—	—
Property, plant and equipment	17	8.0	7.1	—	0.5
Right of use assets	18	12.1	16.4	—	7.4
Goodwill	19	1.2	1.2	—	—
Other intangible assets	20	65.0	61.5	—	1.4
Investment in subsidiaries	21	—	—	301.0	247.9
Retirement benefit asset	22	6.4	27.8	6.4	27.8
Derivative financial instruments	23	3.9	—	3.7	0.6
Deferred tax assets	24	30.0	25.0	—	—
Total assets	1	3,9 4 1.7	3,3 7 5.3	1,085.2	1,064.5
Liabilities and equity
Liabilities
Trade and other payables	25	5 1.8	46.1	13.2	20.9
Current tax liabilities		—	—	13.9	8.2
Provisions	26	7.9	15.5	1.1	5.6
Lease liabilities	27	21.2	32.5	—	11.3
Retail deposits	28	3,019.9	2,42 8.2	—	—
Bank and other borrowings	28	34 7.5	410.0	146.6	204.7
Derivative financial instruments	23	6.1	1.8	0.4	1.7
Deferred tax liabilities	24	—	—	1.0	5.6
Total liabilities	1	3,45 4.4	2,93 4.1	176.2	258.0
Equity
Share capital	30	53.2	53.2	53.2	53.2
Share premium		27 6.3	2 7 6.3	276.3	276.3
Merger reserve		27 8.2	278 . 2	280.5	280.5
Other reserves		9.2	10.8	8.4	10.0
Retained earnings		(188.2)	(177.3)	232.0	186.5
Other equity instruments	32	5 8.6	—	58.6	—
Total equity	1	48 7.3	441.2	909.0	806.5
Total liabilities and equity		3,9 41.7	3,37 5.3	1,085.2	1,064.5

Balance sheets

In accordance with the exemption allowed by

section 408 of the Companies Act 2006, the

Company has not presented its own income

statement or statement of other comprehensive

income. The retained profit for the financial year

reported in the financial statements of the

Company was £6 5.8m (2024: £6 2.3m).

The financial statements on pages 137 to 198

were approved and authorised for issue by the

Board of Directors on 25 February 2026 and

signed on its behalf by:

Ian McLaughlin Dave Watts

Chief Executive Officer Chief Financial Officer

Company Number – 668987

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Governance Financial statementsStrategic report Shareholder information

						Attributable to ordinary shareholders
						Other reserves
							Share-
					Profit	Capital	based
		Share	Share	Merger	retained by	redemption	payment	Retained		Other equity
		capital	premium	reserve 1	subsidiary	reserve 2	reserve 3	earnings	Total	instruments	Total
Group	Note	£m	£m	£m	£m	£m	£m	£m	£m	£m	£m
At 1 January 2024		53.2	2 76.3	278 . 2	0.8	3.6	7.7	(50.7)	56 9.1	—	56 9.1
Loss for the year		—	—	—	—	—	—	(119.3)	(119.3)	—	(119.3)
Other comprehensive (expense)/income:
– actuarial movements on retirement benefit asset	22	—	—	—	—	—	—	(11.6)	(11.6)	—	(11.6)
– tax on items taken directly to other comprehensive income	7	—	—	—	—	—	—	2.9	2.9	—	2.9
Other comprehensive expense for the year		—	—	—	—	—	—	(8.7)	(8.7)	—	(8.7)
Total comprehensive expense for the year		—	—	—	—	—	—	(12 8.0)	(12 8.0)	—	(12 8.0)
Dividends	9	—	—	—	—	—	—	(2.5)	(2.5)	—	(2.5)
Share-based payment charge	31	—	—	—	—	—	2.7	—	2.7	—	2.7
Transfer of share-based payment reserve on vesting of share awards		—	—	—	—	—	(4.0)	4.0	—	—	—
Purchase of shares for share awards		—	—	—	—	—	—	(0.1)	(0.1)	—	(0.1)
At 31 December 2024		53.2	2 76.3	278 . 2	0.8	3.6	6.4	(177.3)	441.2	—	44 1.2
At 1 January 2025		53.2	2 7 6.3	2 7 8.2	0.8	3.6	6.4	(177.3)	44 1.2	—	441.2
Profit for the year		—	—	—	—	—	—	8.2	8.2	0.5	8.7
Other comprehensive (expense)/income:
– actuarial movements on retirement benefit asset	22	—	—	—	—	—	—	(22.1)	(22.1)	—	(22.1)
– tax on items taken directly to other comprehensive income	7	—	—	—	—	—	—	5.5	5.5	—	5.5
Other comprehensive expense for the year		—	—	—	—	—	—	(16.6)	(16.6)	—	(16.6)
Total comprehensive (expense)/income for the year		—	—	—	—	—	—	(8.4)	(8.4)	0.5	(7.9)
Share-based payment charge	31	—	—	—	—	—	2.2	—	2.2	—	2.2
Transfer of share-based payment reserve on vesting of share awards		—	—	—	—	—	(3.8)	3.8	—	—	—
Purchase of shares for share awards		—	—	—	—	—	—	(6.3)	(6.3)	—	(6.3)
Issuance of other equity instruments	32	—	—	—	—	—	—	—	—	58.6	58.6
Distributions on other equity instruments	32	—	—	—	—	—	—	—	—	(0.5)	(0.5)
At 31 December 2025		53.2	27 6.3	27 8.2	0.8	3.6	4.8	(188.2)	4 28.7	58.6	48 7.3

1 The full merger reserve is considered distributable.

2 The capital redemption reserve represents profits on the redemption of preference shares arising in prior years, together with the capitalisation of the nominal value of shares purchased and cancelled, net of the utilisation of this reserve to capitalise the nominal value of

shares issued to satisfy scrip dividend elections.

The share-based payment reserve reflects the corresponding credit entry to the cumulative share-based payment charges made through the income statement as there is no cash cost or reduction in assets from the charges. When options and awards vest, the element of

the share-based payment reserve relating to those awards and options is transferred to retained earnings.

Statements of changes in equity

140 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Attributable to ordinary shareholders

Other reserves

Company Note

capital

£m

premium

£m

Merger

reserve

£m

Capital

redemption

reserve

£m

Share-

based

payment

reserve

£m

Retained

earnings

£m

Total

£m

Other equity

instruments

£m

Total

£m

At 1 January 2024 53.2 276.3 280.5 3.6 7.7 133.8 755.1 — 755.1

Profit for the year — — — — — 62.3 62.3 — 62.3

Other comprehensive (expense)/income:

– actuarial movements on retirement benefit asset 22 — — — — — (11.6) (11.6) — (11.6)

– tax on items taken directly to other comprehensive income 7 — — — — — 2.9 2.9 — 2.9

Other comprehensive expense for the year — — — — — (8.7) (8.7) — (8.7)

Total comprehensive income for the year — — — — — 53.6 53.6 — 53.6

Dividends 9 — — — — — (2.5) (2.5) — (2.5)

Share-based payment charge 31 — — — — 1.5 — 1.5 — 1.5

Transfer of share-based payment reserve on vesting of share awards — — — — (1.7) 1.7 — — —

Share-based payment movement in investment in subsidiaries — — — — (1.1) — (1.1) — (1.1)

Purchase of shares for share awards — — — — — (0.1) (0.1) — (0.1)

At 31 December 2024 53.2 276.3 280.5 3.6 6.4 186.5 806.5 — 806.5

At 1 January 2025 53.2 276.3 280.5 3.6 6.4 186.5 806.5 — 806.5

Profit for the year — — — — — 65.3 65.3 0.5 65.8

Other comprehensive (expense)/income:

– actuarial movements on retirement benefit asset 22 — — — — — (22.1) (22.1) — (22.1)

– tax on items taken directly to other comprehensive income 7 — — — — — 5.5 5.5 — 5.5

Other comprehensive expense for the year — — — — — (16.6) (16.6) — (16.6)

Total comprehensive income for the year — — — — — 48.7 48.7 0.5 49.2

Share-based payment charge 31 — — — — 1.2 — 1.2 — 1.2

Transfer of share-based payment reserve on vesting of share awards — — — — (3.1) 3.1 — — —

Share-based payment movement in investment in subsidiaries — — — — 0.3 — 0.3 — 0.3

Purchase of shares for share awards — — — — — (6.3) (6.3) — (6.3)

Issuance of other equity instruments 32 — — — — — — — 58.6 58.6

Distributions on other equity instruments 32 — — — — — — — (0.5) (0.5)

At 31 December 2025 53.2 276.3 280.5 3.6 4.8 232.0 850.4 58.6 909.0

1 The full merger reserve is considered distributable.

shares issued to satisfy scrip dividend elections.

3 The share-based payment reserve reflects the corresponding credit entry to the cumulative share-based payment charges made through the income statement as there is no cash cost or reduction in assets from the charges. When options and awards vest, the element of

the share-based payment reserve relating to those awards and options is transferred to retained earnings.

Statements of changes in equity continued

141 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

		Group		Company
			2024		2024
		2025	(restated) 1	2025	(restated) 1
	Note	£m	£m	£m	£m
Cash flows from operating activities
Cash generated from/(used in) operations	35	8 9.0	444.5	(14.3)	(38.6)
Tax received		4.0	8.2	—	—
Net cash generated from/(used in) operating activities		93.0	4 52.7	(14.3)	(38.6)
Cash flows from investing activities
Purchase of intangible assets	20	(15.2)	(12.5)	—	—
Purchase of property, plant and equipment	17	(3.3)	(2.2)	(1.9)	—
Proceeds from sale of available for sale investment		—	4.3	—	—
Purchase of investment securities		(291.8)	—	—	—
Proceeds from maturity of investment securities		4 0.0	—	—	—
Dividends received from subsidiaries	33	—	—	20.0	40.0
Net cash (used in)/generated from investing activities		(2 70.3)	(10.4)	18.1	40.0
Cash flows from financing activities
Proceeds from bank and other borrowings		—	5.0	—	—
Repayment of bank and other borrowings		(63.7)	(174.0)	(58.5)	—
Payment of lease liabilities		(10.0)	(9.7)	(3.3)	(3.0)
Dividends paid to Company shareholders		—	(2.5)	—	(2.5)
Distributions on other equity instruments	32	(0.5)	—	(0.5)	—
Proceeds from issue of other equity instruments	32	58.6	—	58.6	—
Purchase of own shares for share awards		(6.3)	(0.1)	(6.3)	(0.1)
Net cash used in financing activities		(21.9)	(18 1.3)	(10.0)	(5.6)
Net (decrease)/increase in cash, cash equivalents and overdrafts		(199.2)	2 61.0	(6.2)	(4.2)
Cash, cash equivalents and overdrafts at beginning of year		1,002.8	7 4 1.8	10.5	14.7
Cash, cash equivalents and overdrafts at end of year		80 3.6	1,00 2.8	4.3	10.5
Cash, cash equivalents and overdrafts at end of year comprise:
Cash at bank and in hand	12	80 4.5	1,003.9	4.3	10.5
Overdrafts (held in bank and other borrowings)	28	(0.9)	(1.1)	—	—
Total cash, cash equivalents and overdrafts		80 3.6	1,00 2.8	4.3	10.5

1 Refer to note 35 for details on restatement.

In the Group, interest received was £619.2m (2024: £6 37.8m) and interest paid was £94.6m (2024: £10 3.0m). This is all included within cash generated from/(used in) operations.

In the Company, interest received was £9.1m (2024: £8.5m) and interest paid was £27.0m (2024: £21.7m). This is all included within cash generated from/(used in) operations.

Cash at bank and in hand includes £7 46.8m (2024: £9 48.7m) in respect of the liquid asset buffer, including other liquidity resources, held by Vanquis Bank Limited in accordance with the PRA’s liquidity regime.

Statements of cash flows

For the year ended 31 December

142 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

General information

The Company is a public limited company incorporated and domiciled in the UK. The address of its

registered office is Fairburn House, 5 Godwin Street, Bradford, England BD1 2AH. The Company is

listed on the London Stock Exchange.

Basis of preparation

The financial statements of the Group and Company are prepared in accordance with International

Accounting Standards and International Financial Reporting Standards (IFRS) as issued by the

International Accounting Standards Board and adopted by the UK; and the Companies Act 2006.

The financial statements have been prepared on a going concern basis under the historical cost

convention, as modified by the revaluation of derivative financial instruments and investments held

at fair value through profit and loss.

In assessing whether the Group is a going concern, the directors’ review has been made on the basis

that the Group continues to operate for the 12 months from the date of the approval of the financial

statements. The directors considered the appropriateness of the going concern basis, the period of

assessment, any reporting requirements, and solvency and liquidity risks, and included a variety of

factors – forecasts and budgets, timing of cash flows and funding, the Group’s primary market and

any contingent liabilities. When considering the appropriateness of going concern, the directors have

also considered the Group’s ability to meet its regulatory requirements (both capital and liquidity)

at all times and not just a positive net asset measure.

The assessment of going concern for the Group for the purposes of the Annual Report and financial

statements considered the following factors:

5 The Group’s corporate plan as approved in January 2026, which sets out financial, capital,

liquidity and funding projections, together with an overview of relevant risks.

5 The principal and emerging risks, which could impact the performance of the Group, with a focus

on capital and liquidity.

5 The severe but plausible downside scenario, which is designed to assess the potential impact

of certain underlying risks on the Group’s capital and funding resources, together with the

availability and effectiveness of mitigating actions.

5 Reverse stress testing analysis, which is designed to assess the point at which the Group

is no longer a going concern.

Having considered the Group’s forecasts, the regulatory capital and liquidity of the Group and

the regulatory outlook, the directors have a reasonable expectation that the Group will continue

as a going concern for a period of at least 12 months from the date of approving these financial

statements. Accordingly, the financial statements of the Group have been prepared on the going

concern basis.

Change in accounting policies

Group principal accounting policies under IFRS have been consistently applied to all the years

presented, except where set out below.

Exceptional items

The Group has transitioned to reporting solely on a statutory basis, removing adjustments for

goodwill write-offs, transformation and other exceptional costs, and amortisation of acquisition

intangibles. This follows actions taken in 2024 that resulted in a cleaner, lower-risk balance sheet and

improved transparency at both Group and product levels. Adjusted performance is now expected to

closely align with statutory results. The accounting policy for exceptional items is therefore no longer

in place. As this is a change in accounting policy, the comparatives have been represented; however,

there is no impact on recognition, measurement or total profit and loss in any period presented in this

report. The change reflects a change in presentation of the income statement and associated metrics.

Representation of items

Discontinued operations

The Group sold its loan portfolio in 1H25. In accordance with IFRS 5 Non-current Assets Held for Sale

and Discontinued Operations, this business segment is now presented as discontinued operations.

See note 2.

Segmental reporting

Following the sale of the Personal Loans business, the Group now comprises four segments: the three

core lending products – Credit Cards, Vehicle Finance, and Second Charge Mortgages – and the

Corporate Centre. The Corporate Centre includes the residual performance of the Retail Savings

business, Treasury results after product allocations, Snoop, and other immaterial or central items.

As a result, all previous periods have been represented onto a consistent basis. These changes do not

constitute a change in accounting policy and there is no impact on recognition, measurement or profit

and loss in any period presented in this report. See note 1.

Cash flow statement

The Group and Company cash flow statements have been restated. Refer to note 35 for details.

The impact of new standards not yet effective and not adopted by the

Group from 1 January 2026

IFRS 18 Presentation and Disclosures in Financial Statements

IFRS 18 replaces IAS 1, carrying forward many of the requirements in IAS 1 unchanged and

complementing them with new requirements. In addition, some IAS 1 paragraphs have been moved to

IAS 8 and IFRS 7. Furthermore, the IASB has made minor amendments to IAS 7 and IAS 33 Earnings

per Share.

Material accounting policy information

143 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

The impact of new standards not yet effective and not adopted by the

Group from 1 January 2026 continued

IFRS 18 Presentation and Disclosures in Financial Statements continued

IFRS 18 introduces new requirements to:

5 present specified categories and defined subtotals in the statement of profit or loss;

5 provide disclosures on Management-Defined Performance Measures (MPMs) in the notes to the

financial statements; and

5 improve aggregation and disaggregation.

An entity is required to apply IFRS 18 for annual reporting periods beginning on or after 1 January

2027, with earlier application permitted. The amendments to IAS 7 and IAS 33, as well as the revised

IAS 8 and IFRS 7, become effective when an entity applies IFRS 18. IFRS 18 requires retrospective

application with specific transition provisions.

The Group’s assessment is ongoing and anticipates that the application of these amendments may

have an impact on the presentation of its consolidated financial statements in future periods.

There are no other new standards not yet effective and not adopted by the Group from 1 January

2026 that are expected to have a material impact on the Group.

Basis of consolidation

The consolidated income statement, consolidated statement of comprehensive income, consolidated

statement of financial position, statement of changes in shareholders’ equity, statement of cash flows and

notes to the financial statements include the financial statements of the Company and all of its subsidiary

undertakings drawn up from the date control passes to the Group until the date control ceases.

Control is achieved when the Group:

5 has power over the investee;

5 is exposed, or has rights, to variable returns from its involvement with the investee; and

5 has the ability to use its power to affect returns.

All intra-group transactions and balances and unrealised gains on transactions between Group

companies are eliminated on consolidation.

The accounting policies of subsidiaries are consistent with the accounting policies of the Group.

A full list of the Group’s subsidiaries is set out in note 37, together with further information on the

basis on which they are considered to be controlled by the Company.

Interest income

Interest income is earned from Credit Cards, Vehicle Finance and Second Charge Mortgages

products. It also includes interest received from Vanquis Bank Limited’s liquid asset buffer, interest on

gilts, interest on balances held in the Bank of England central reserve account, net fair value gains

recognised in relation to the Group’s derivative financial instruments, and other minor interest income.

Interest is calculated on Credit Card advances to customers and Second Charge Mortgages

balances using the effective interest rate on the daily balance outstanding.

Within Vehicle Finance, interest income is recognised in line with IFRS 16. Refer to Leases accounting

policy for details value.

Interest income is recognised on the gross receivable when accounts are in IFRS 9 Stages 1 and 2 and

on the net receivable for accounts in Stage 3.

Directly attributable acquisition costs are capitalised as part of receivables and amortised over the

life of the loan as a deduction to interest income.

Group interest income excludes intra-group transactions.

Company interest income includes intra-group transactions.

Interest expense

Interest expense principally comprises the interest on retail deposits, senior and public bonds,

securitisations and lease liability interest. For the Company, it also includes intra-group loan

arrangements, and is recognised on an effective interest rate basis.

Fee and commission income

Fee and commission income is earned from Credit Cards and is recognised at the time the charges

are made to customers on the basis that the performance obligation is complete.

Group fee income excludes intra-group transactions.

Dividend income

Dividend income is recognised in the income statement when the Company’s right to receive payment

is established.

Goodwill

All acquisitions are accounted for using the purchase method of accounting.

Goodwill is an intangible asset and is measured as the excess of the fair value of the consideration

over the fair value of the acquired identifiable assets, liabilities and contingent liabilities at the date

of acquisition. Gains and losses on the disposal of a subsidiary include the carrying amount of

goodwill relating to the subsidiary sold.

Goodwill is allocated to cash-generating units for the purposes of impairment testing. The allocation

is made to those cash-generating units or groups of cash-generating units that are expected to

benefit from the business combination in which the goodwill arose.

Goodwill is tested annually for impairment and is carried at cost less accumulated impairment losses.

Impairment is tested by comparing the carrying value of the asset to the discounted expected future

cash flows from the relevant cash-generating unit. Expected future cash flows are derived from the

Company’s latest budget projections and the discount rate is based on the Company’s risk-adjusted

cost of equity at the balance sheet date.

Any goodwill impairment or write-off is charged to the income statement as part of operating costs .

Material accounting policy information continued

144 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Investments in subsidiaries

The Company’s investments in subsidiaries are stated at cost less provisions for impairment where

required. Impairment provisions reflect the shortfall between the carrying value of the investment with

the higher of: (i) fair value less costs to sell; and (ii) value in use of the subsidiary.

Employee benefit trust

The employee benefit trust (EBT) has been set up to hold shares in the Company in conjunction with

the Group’s employee share ownership arrangements, the assets, liabilities and transactions of the

trust are accounted for within the accounts of the Company. Shares in Vanquis Banking Group plc

held by the trustee of the Group’s EBT are shown on the balance sheet as a deduction in arriving at

total equity. Own shares are stated at cost .

Leases

The Group and Company as a lessee

The Group and Company assess whether a contract contains a lease at inception of a contract. A

right of use asset and a corresponding liability are recognised with respect to all lease arrangements

where it is a lessee, except for short-term leases (leases with a lease term of 12 months or less) and

leases of low-value assets (less than £5,000). For these leases, the lease payment is recognised within

operating expenses on a straight-line basis over the lease term.

The lease liability is initially measured at the present value of the lease payments at the

commencement date, discounted using the rate implicit in the lease. This rate could not be readily

determined; therefore, the incremental borrowing rate has been used. This is defined as the rate of

interest that the lessee would have to pay to borrow, over a similar term and with similar security, the

funds necessary to obtain an asset of a similar value to the right of use asset in a similar economic

environment. For Vanquis Bank Limited, this would represent an average retail deposit rate; for all

other companies this would be based on the assessment of their funding rate at the time.

The lease payments included in the measurement of the lease liability comprise:

5 fixed lease payments;

5 variable lease payments; and

5 payment of penalties for terminating the lease, if the lease term reflects the exercise of an option

to terminate the lease.

The lease liability is subsequently measured by increasing the carrying amount to reflect interest on

the lease, using the effective interest rate method, and reducing the carrying amount to reflect the

lease payments made.

The lease liability is remeasured whenever:

5 the lease term has changed, in which case the lease liability is remeasured by discounting the

revised lease payments using a revised discount rate;

5 the lease payments change due to changes in an index or rate, in which case the lease liability is

remeasured by discounting the revised lease payments using the initial discount rate; and

5 the lease contract is modified and the modification is not accounted for as a separate lease, in

which case the lease liability is remeasured by discounting the revised lease payments using a

revised discount rate.

The right of use asset comprises the initial measurement of the corresponding lease liability and is

subsequently measured at cost less accumulated depreciation and impairment losses.

Right of use assets are depreciated over the shorter period of lease term and useful life of the

underlying asset.

The lease liability and right of use asset are presented as separate line items on the balance sheet.

The interest on the lease and depreciation are charged to the income statement and presented within

interest expense and operating costs respectively.

The Group and Company as a lessor

Vehicle Finance is considered a lessor for its Conditional Sale Agreements to customers. Finance lease

income is presented within interest income. It is allocated to accounting periods so as to reflect a

constant periodic rate of return on the Group’s net investment outstanding in respect of the leases.

Finance lease income is calculated with reference to the gross carrying amount of the lease

receivables, except for credit-impaired financial assets for which interest income is calculated with

reference to their amortised cost (i.e. after a deduction of the loss allowance).

Refer to the accounting policy for the amounts receivable from customers for further detail.

The Group sub-leases a portion of its office space and accounts for it as a finance lease.

Other intangible assets

Other intangible assets include acquisition intangibles in respect of the technology and brand of

Snoop, standalone computer software and development costs of intangible assets across the Group.

The fair value of Snoop’s technology was estimated using multi-period excess earnings methodology.

The fair value of Snoop’s brand valuation was estimated using an income approach based on the

Relief from Royalties Methodology. The estimated useful life of the technology was deemed to be nine

years and of the brand was deemed to be five years. The assets are being amortised on a straight-

line basis over their useful life.

Computer software and computer software development assets represent the costs incurred to

acquire or develop software and bring it into use. Directly attributable costs incurred in the

development of software are capitalised as an intangible asset if the software will generate future

economic benefits. Directly attributable costs include the cost of software development employees

and an appropriate portion of relevant directly attributable overheads.

Computer software and computer software development costs are amortised on a straight-line basis

over their estimated useful economic life, which is generally estimated to be between three and 10

years. The residual values and economic lives of intangible assets are reviewed by management at

each balance sheet date .

Material accounting policy information continued

145 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Other intangible assets continued

Other intangible assets are valued at cost less subsequent amortisation and impairment.

Amortisation and impairment are charged to the income statement as part of operating costs. An

impairment loss is recognised for the amount by which the asset’s carrying value exceeds the higher

of the asset’s value in use and its fair value less costs to sell.

Amounts receivable from customers

Customer receivables under IFRS 9 are initially recognised at fair value, which represents the amount

advanced to the customer plus directly attributable issue costs less an impairment provision for

expected losses. The receivables are originated under a business model that intends to collect the

contractual cash flows and includes only elements of principal and interest, so are subsequently

measured at amortised cost less impairment provisions. The impairment provision recognised is based

on the Probability of Default (PD), the Loss Given Default (LGD) and the Exposure at Default (EAD).

IFRS 9 requires a three-stage ECL approach for measuring impairment:

5 Stage 1 – a 12-month ECL allowance is recognised where there is no significant increase in credit

risk (SICR) since initial recognition.

5 Stage 2 – a lifetime ECL allowance is recognised for receivables where a SICR is identified since

initial recognition.

5 Stage 3 – requires objective evidence that the receivable is credit impaired, at which point a

lifetime ECL allowance is recognised.

On initial recognition, all accounts are recognised in IFRS 9 Stage 1.

The account moves to Stage 2 when a SICR becomes evident, such as a missed payment or a

significant increase in PD but has not defaulted. In the absence of other factors indicating SICR, this

will occur at 30 days past due.

An account moves to Stage 3 and is deemed to have defaulted at 90 days past due, or when a

payment arrangement is initiated, or when other unlikeliness to pay factors arise (like customer

bankruptcy proceedings).

Accounts are charged off when they meet certain criteria set out in the Group’s charge-off policy and

are generally expected to be sold to debt collection agencies. This is largely linked to the number of

customer missed payments. A post-charge-off asset (PCOA) is recognised based on expected future

cash flows. When an account is charged off both the reduction in gross receivable and the release of

the impairment provision is recognised in the income statement, within impairment. In line with IFRS 9

5.5.4 this reflects a partial write off of the gross receivable, with a corresponding release in the

associated impairment provision. Any additional charge as a result of the partial write off is also

recognised within impairment in the income statement. The accounts remain held at amortised cost as

the business model is unchanged.

A customer’s debt is written off when it is sold to debt collection agencies or when there is no further

expectation of collections. Any subsequent recoveries are recognised as a credit to impairment when

received .

Credit Cards

On inception an expected loss impairment provision is recognised using PD/LGD/EAD models, which

forecast customer behaviour to calculate losses.

For Credit Cards, the PD is determined by utilising a customer’s behavioural score used for

underwriting the Credit Card. The LGD discounts the EAD, which adjusts the current card balance

for future expected spend and interest. It does not include any future credit line increases.

Vehicle Finance

Vehicle Finance amounts receivable from customers includes finance leases. Finance leases are

initially measured at an amount equal to the net investment in the lease, using the interest rate

implicit in the finance lease.

Direct costs are included in the initial measurement of the net investment in the lease and reduce the

amount of income recognised over the lease term. Interest income is recognised over the lease term,

based on a pattern reflecting a constant periodic rate of return on the net investment in the lease.

Subsequent to initial recognition, the Group applies the impairment requirements of IFRS 9,

recognising an allowance for expected credit losses on the finance lease receivables.

Losses are recognised on inception of a loan based on the probability of a customer defaulting within

12 months. This is determined with reference to historical customer data and outcomes.

An account moves from Stage 1 to Stage 2 when there has been a SICR. Lifetime losses are

recognised for all accounts in Stages 2 and 3.

A customer is deemed to have defaulted when they become three monthly payments in arrears or

enter into a forbearance arrangement. Customer agreements that have been terminated, either

voluntarily by the customer settling their agreement early and where a balance remains, or through

the agreement being default terminated, are also included within Stage 3.

Second Charge Mortgages

For Second Charge Mortgages, the PD is determined on a portfolio basis and applied at account

level. The PD will increase if an account misses a payment and enters Stage 2 and will default at the

point three payments are missed. The LGD uses the whole LTV capturing the first and second charge

outstanding balances. The EAD reflects the estimated balance when three payments are missed.

Customers under forbearance

Customers are moved to IFRS 9 Stage 3 and lifetime losses are recognised in all products where

forbearance is provided to the customer or alternative payment arrangements are established.

Customers under temporary payment arrangements are separately identified according to the type

of arrangement. The carrying value of receivables under each type of payment arrangement is

calculated using historical cash flows under that payment arrangement, discounted at the original

effective interest rate.

Macroeconomic scenarios

Macroeconomic provisions are part of the core model and are recognised to reflect the expected

impact of future economic events on a customer’s ability to make payments on their agreements

and the losses that are expected to be incurred.

Material accounting policy information continued

146 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Amounts receivable from customers continued

Macroeconomic scenarios continued

The provisions consider the relationship between hazard rate, the number of people who were

employed last month but who are unemployed the following month (derived from unemployment).

In 2024, debt to income ratio, default and write off rates were also considered.

Property, plant and equipment

Property, plant and equipment is shown at cost less accumulated depreciation and impairment,

except for land, which is shown at cost less impairment.

Cost represents invoiced cost plus any other costs that are directly attributable to the acquisition of

the items. Repairs and maintenance costs are expensed as incurred.

Depreciation is calculated to write down assets to their estimated realisable values over their useful

economic lives.

The following principal bases are used:

	%	Method
Land	Nil	—
Leasehold improvements	Over the lease period	Straight line
Equipment (including computer hardware)	10 to 33 1/3	Straight line
Motor vehicles	25	Reducing balance

The residual values and useful economic lives of all assets are reviewed, and adjusted if appropriate,

at each balance sheet date. All items of property, plant and equipment, other than land, are tested

for impairment whenever events or changes in circumstances indicate that the carrying value may not

be recoverable. Land is subject to an annual impairment test. An impairment loss is recognised for the

amount by which the asset’s carrying value exceeds the higher of the asset’s value in use and its fair

value less costs to sell. Gains and losses on disposal of property, plant and equipment are

determined by comparing any proceeds with the carrying value of the asset and are recognised

within operating costs in the income statement.

Depreciation is charged to the income statement as part of operating costs.

Investments

Investment securities

The Group’s investments in securities are held as part of its liquidity buffer, with the intention to collect

the contractual cash flows. These securities are carried at amortised cost, with income recognised on

an effective interest rate (EIR) basis.

Investments held at fair value through profit and loss

Visa Inc shares are measured at fair value in the balance sheet as a reliable estimate of the fair

value can be determined. Valuation adjustments arising as a result of routine mark-to-market

revaluation are recognised in the income statement.

Fair value changes including any impairment losses and foreign exchange gains or losses are

recognised within other income in the income statement. The fair value of monetary assets denominated

in foreign currency is determined through translation at the spot rate at the balance sheet date.

Dividends on equity instruments are recognised in the income statement when the Group’s right to

receive the dividends is established.

Derivative financial instruments and hedge accounting

As permitted by IFRS 9, the Group continues to apply the requirements of IAS 39 to its

hedging relationships.

Derivatives are recognised at fair value with changes recognised in the income statement. Hedge

accounting allows the derivative to be designated as a hedge of another financial instrument. At the

inception of the hedge relationship, formal documentation is drawn up specifying the hedging strategy,

the hedged item, the hedging instrument and the methodology that will be used to measure the

effectiveness of the hedge relationship in offsetting changes in the fair value or cash flow of the

hedged risk. The effectiveness of the hedging relationship is tested both at inception and throughout

its life, and if at any point it is concluded that it is no longer highly effective in achieving its

documented objective, hedge accounting is discontinued.

Cash and cash equivalents

Cash and cash equivalents comprise cash at bank and in hand, which includes amounts invested in

the Bank of England reserve account held in accordance with the Prudential Regulation Authority’s

(PRA’s) liquidity regime. Cash held as part of securitisations is not immediately available due to the

terms of the arrangements. Bank overdrafts are presented in borrowings to the extent that there

is no right of offset with cash balances.

Amounts owed by or to group companies

In the accounts of the Company, balances owed by other group companies are carried at amortised

cost less impairment provisions. Expected credit losses on intercompany balances are assessed at each

balance sheet date. In assessing SICR, both quantitative and qualitative indicators are considered

including payment behaviour and the financial position of the borrower. This include any non-payments

of capital or interest due and negative equity. In the absence of any other factors, SICR will be

considered after a payment is 30 days past due. The PDs and LGDs are determined for each loan

based on the subsidiary’s available funding and cash flow forecasts.

Balances owed to other group companies are carried at amortised cost.

Borrowings

Borrowings are recognised initially at fair value, being issue proceeds less any transaction costs

incurred. Borrowings are subsequently stated at amortised cost; any difference between proceeds

less transaction costs and the redemption value is recognised in the income statement over the

expected life of the borrowings using the effective interest rate.

Retail deposits are recognised initially at fair value, being the cash received from the customer.

Interest payable to the customer is recognised in the income statement over the deposit term on an

effective interest rate basis.

Material accounting policy information continued

147 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Dividends paid

Dividend distributions to the Company’s shareholders are recognised in the Group and the

Company’s financial statements as follows:

5 final dividend: when approved by the Company’s shareholders at the AGM; and

5 interim dividend: when paid by the Company.

Retirement benefits

Defined benefit pension schemes

The charge in the income statement in respect of defined benefit pension schemes comprises the

actuarially assessed current service cost of working employees up to when the scheme was closed,

together with the interest on pension liabilities offset by the interest on pension scheme assets. All

charges are recognised within operating costs in the income statement.

The retirement benefit asset recognised in the balance sheet in respect of defined benefit pension

schemes is the fair value of the schemes’ assets less the present value of the defined benefit

obligation at the balance sheet date. A retirement benefit asset is recognised to the extent that the

Group and Company have an unconditional right to a refund of the asset or if it will be recovered in

future years as a result of reduced contributions to the pension scheme.

The defined benefit obligation is calculated annually by independent actuaries using the projected

unit credit method. The present value of the defined benefit obligation is determined by discounting

the estimated future cash outflows using interest rates of high-quality corporate bonds that have

terms to maturity approximating to the terms of the related pension liability.

Actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions

are recognised immediately in the statement of comprehensive income.

Past service costs are recognised immediately in the income statement.

Defined contribution pension schemes

Contributions to defined contribution pension schemes are charged to the income statement on an

accruals basis.

Share capital

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new

shares are shown in equity as a deduction, net of tax, from the proceeds.

Merger reserve

The merger reserve was created following a rights issue and is considered distributable.

Other equity instruments

Other equity instruments is made up of the principal issuance amount net of issue costs of Additional

Tier 1 capital issued by the Company in October 2025 .

Share-based payments

Equity-settled schemes

The Company grants options under employee savings-related share option schemes (typically

referred to as Save As You Earn schemes (SAYE)) and makes awards under the Deferred Bonus Plan

(DBP), the Long Term Incentive Scheme (LTIS), the Restricted Share Plan (RSP) and the Company Share

Option Plan (CSOP). All of these schemes are equity settled.

The cost of providing options and awards to Group and Company employees is charged to the

income statement of the entity over the vesting period of the related options and awards. The

corresponding credit is made to a share-based payment reserve within equity. The grant by the

Company of options and awards over its equity instruments to the employees of subsidiary

undertakings is treated as an investment in the Company’s financial statements. The fair value of

employee services received, measured by reference to the fair value at the date of grant, is

recognised over the vesting period as an increase in investments in subsidiary undertakings, with a

corresponding adjustment to the share-based payment reserve within equity.

For LTIS schemes, performance conditions are based on share price, a risk underpin assessment

(which may include items such as relationships with key regulatory stakeholders, and the

demonstration of improved operational risk effectiveness and controls) and the overall assessment of

the Group’s performance by the Remunerations Committee. The fair value of awards is determined

using a Market-Based FV Adjustment method. The value of the charge is adjusted at each balance

sheet date to reflect lapses and expected or actual levels of vesting.

The cost of options and awards is based on their fair value. A binomial model is used for calculating

the fair value of SAYE options, which have no performance conditions attached, and the RSP for which

vesting is based on the discretion of the Remuneration Committee. No charge has been recognised for

the CSOP as it is linked to the RSP awards granted at the same time. Any gains made by an employee

in relation to the CSOP reduce the number of shares exercisable under the RSP award.

The value of the charge is adjusted at each balance sheet date to reflect lapses and expected or

actual levels of vesting, with a corresponding adjustment to the share-based payment reserve.

Cancellations by employees of contributions to the Group’s SAYE plans are treated as non-vesting

conditions and the Group recognises, in the year of cancellation, the amount of the expense that

would have otherwise been recognised over the remainder of the vesting period.

Modifications are assessed at the date of modification and any incremental charges are recognised

in the income statement.

A transfer is made from the share-based payment reserve to retained earnings when options and

awards vest, lapse or are cancelled. In respect of the SAYE options, the proceeds received, net of any

directly attributable transaction costs, are credited to share capital and share premium when the

options are exercised.

Taxation

The tax charge represents the sum of current and deferred tax.

Material accounting policy information continued

148 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Taxation continued

Current tax

Current tax is calculated based on taxable profit for the year using tax rates that have been enacted

or substantively enacted by the balance sheet date. Taxable profit differs from profit before taxation

as reported in the income statement because it excludes items of income or expense that are taxable

or deductible in other years and it further excludes items that are never taxable or deductible.

Deferred tax

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying

amounts of assets and liabilities in the financial statements and the corresponding tax bases used

in the computation of taxable profit, and is accounted for using the balance sheet liability method.

Deferred tax is determined using tax rates (and laws) that have been enacted or substantively

enacted by the balance sheet date and are expected to apply when the related deferred tax asset is

realised or the deferred tax liability is settled. Deferred tax is also provided on temporary differences

arising on investments in subsidiaries, except where the timing of the reversal of the temporary

difference is controlled by the Company and it is probable that the temporary difference will not

reverse in the future.

Deferred tax assets are recognised to the extent that it is probable that future taxable profits will be

available against which the related temporary differences or carried forward tax losses can be utilised.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current

tax assets against current tax liabilities and when the deferred tax assets and liabilities relate to

income taxes levied by the same taxation authority on either the taxable entity or different taxable

entities where there is an intention to settle the balances on a net basis.

Provisions for liabilities

Provisions are recognised when the Group has a present obligation (legal or constructive) as a result

of a past event, it is probable that the Group will be required to settle that obligation and a reliable

estimate can be made of the amount of the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle

the present obligation at the balance sheet date, taking into account the risks and uncertainties

surrounding the obligation. Where a provision is measured using the cash flows estimated to settle

the present obligation, its carrying amount is the present value of those cash flows (when the effect

of the time value of money is material).

Contingent liabilities

Contingent liabilities are possible obligations arising from past events whose existence will be

confirmed only by uncertain future events, or present obligations arising from past events that are

not recognised because either an outflow of economic benefits is not probable or the amount of the

obligation cannot be reliably measured. Contingent liabilities are not recognised in the balance sheet,

but information about them is disclosed unless the possibility of any economic outflow in relation to

settlement is remote.

Securitisations

The Group has two securitisations in issue. The Group holds an exposure to the performance of these

vehicles in the form of retained notes and has a contractual right to the variable returns of the vehicles.

The transfers of the beneficial interest of amounts receivable from customers to the securitisations are

not treated as sales by the Group and the assets not derecognised. The Group continues to recognise

these assets within its own balance sheet after as it retains substantially all the risks and rewards

through the receipt of interest income and deferred consideration from the securitisations for the

transfer of the beneficial interest.

The securitisations are fully consolidated into the Group accounts in accordance with IFRS 10.

Critical accounting judgements and key sources of estimation uncertainty

In applying the accounting policies set out above, the Group and Company make judgements (other

than those involving estimates) that have a significant impact on the amounts recognised and make

estimates and assumptions that affect the reported amounts of assets and liabilities.

The estimates and judgements are based on historical experience; actual results may differ from

these estimates.

In preparing the Group’s financial statements, the Group has 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.

Due to the impact of any estimates in relation to Goodwill no longer being considered material, it is

no longer included as a critical source of estimation uncertainty. Investment in subsidiaries is also no

longer considered to be a critical source of estimation uncertainty for the Company.

Amounts receivable from customers (note 14)

Group: £2,691.5m (2024: £2,153.7m)

Critical accounting judgements

The Group reviews amounts receivable from customers for impairment at each balance sheet date.

For the purposes of assessing the impairment, customers are categorised into IFRS 9 stages and

cohorts which are considered to be the most reliable indication of future payment performance.

The determination of expected credit losses involves complex modelling techniques and requires

management to apply significant judgements to calculate expected credit losses. The most critical

judgements are outlined below.

The determination of the Significant Increase in Credit Risk (SICR) thresholds to be used in the models

requires management judgement to optimise the performance and therefore effectiveness of the

staging methodology. Assessments are made to determine whether there is objective evidence of a

SICR, which indicates whether there has been an adverse effect on Probability of Default (PD). A SICR

for customers is when there has been a significant increase in behavioural score, other qualitaitve

triggers, or when one contractual monthly payment has been missed.

For the purpose of IFRS 9, default is assumed when three contractual repayments have been missed.

Material accounting policy information continued

149 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Critical accounting judgements and key sources of estimation uncertainty

continued

Amounts receivable from customers (note 14) continued

Group: £2,691.5m (2024: £2,153.7m) continued

Critical accounting judgements continued

The Group’s impairment models are subject to periodic monitoring, independent validation and back

testing performed on model components (where appropriate), including PD, EAD and LGD to ensure

management judgements remain appropriate.

Limitations in the Group’s impairment models or data inputs may be identified through the ongoing

assessment and validation of the output of the models. In these circumstances, management makes

appropriate adjustments to the Group’s allowance for impairment losses to ensure that the overall

provision adequately reflects all material credit risks. These adjustments are determined by considering

the particular attributes of exposures that have not been adequately captured by the impairment

models, and range from changes to model inputs and parameters, at account level, through to more

qualitative post-model overlays. Those changes applied to model inputs and parameters are deemed

to be in-model overlays; more qualitative changes that have a higher degree of management

judgement are deemed to be post-model overlays. All adjustments are reviewed quarterly and are

subject to internal review and challenge to ensure that amounts are appropriately calculated.

A breakdown of the in-model and post-model overlays is included within note 14.

Credit performance across the Group remains stable and internal analysis shows no obvious signs of

credit quality deterioration.

Macroeconomic impairment provision adjustments are recognised in the core model to reflect an

increased PD, based on future macroeconomic scenarios.

The macroeconomic models have been redeveloped in 2025. The models use the following variables:

hazard rate, debt to income ratio, real earnings and for Cards only real base rate.

Management judgement was required to determine the appropriate macroeconomic indicators to be used

in the model by assessing their correlation with credit losses incurred by the business. Unemployment, linked

to hazard rate and debt to income ratio are judged to be a key macroeconomic indicator as analysis has

clearly evidenced a correlation between these metrics and credit losses incurred by the business.

In 2024, a model overlay of £5.4m was recognised that looked at Credit Card write-off rates, utilising

data from a third party, Oxford Economics (OE). The OE model predicted industry level write-off rates

using a combination of interest rates on Credit Cards, unemployment rate, debt to income ratio

and a measure of macroeconomic volatility. The outputs from the OE model was calibrated to the

Company’s entry to default rate, which was in turn used to derive the scalars applied to the lifetime

Probability of Default model.

Key sources of estimation uncertainty

The level of impairment recognised is calculated using models that utilise historical payment

performance to generate the estimated amount and timing of future cash flows from each cohort of

customers in each arrears stage. The models are regularly monitored to ensure they retain sufficient

accuracy. Sensitivity analysis has been performed in note 14, which shows the impact of a 1%

movement of gross exposure into Stage 2 from Stage 1 on the allowance accounts.

Vehicle Finance Stage 3 review in 2024

During 2024, a review was undertaken of the Vehicle Finance Stage 3 assets. Vehicle Finance had

been exhibiting an ever-growing Stage 3 gross receivable balance, with a corresponding large and

increasing ECL provision being held. As part of that review, receivables eligible for a potential debt

sale were fully charged off, resulting in a post-charge-off asset (PCOA) being recognised. The

charge-off process led to a partial write-off, with a reduction in gross receivables of c.£261m and a

release of impairment provision of £237m. This resulted in a net charge of £24m, which was

recognised in the income statement within impairment charges.

Macroeconomic assumptions

The macroeconomic forecasts and scenarios used are provided by Oxford Economics. The base case,

upside, downside and severe scenarios are utilised in the model calculate a Multiple Economic

Scenario weighted ECL provision.

The table below shows the scenario five-year peak and average unemployment assumptions

adopted and the weightings applied to each.

Scenario for year ended 2025	Base	Upside	Downside	Severe
Weighting	60%	20%	15%	5%
2026	5.0	4.6	5.8	6.0
2027	4.8	3.9	6.5	7.0
2028	4.5	3.6	6.9	7.4
2029	4.4	3.6	6.7	7.2
2030	4.2	3.6	6.4	6.9
Five-year peak	5.1	4.8	6.9	7.4

Scenario for year ended 2024	Base	Upside	Downside	Severe
Weighting	60%	15%	20%	5%
2025	4.4	4.0	5.0	5.5
2026	4.5	4.1	6.3	7.6
2027	4.5	4.2	5.9	7.9
2028	4.5	4.2	5.3	6.8
2029	4.5	4.2	5.1	6.4
Five-year peak	4.5	4.3	6.5	8.3

The debt to income variables, across all scenarios, ranged from 12.5% at the start of 2026 to 13.7% at

the end of 2030 .

Material accounting policy information continued

150 – Vanquis Banking Group plc Annual Report and Accounts 2025

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Critical accounting judgements and key sources of estimation uncertainty

continued

Amounts receivable from customers (note 14) continued

Group: £2,691.5m (2024: £2,153.7m) continued

Macroeconomic assumptions continued

The following table shows the scenario five-year peak and average expected entry to default rate

from the Oxford Economics model, used as an overlay in 2024.

Scenario for year ended 2024	Base	Upside	Downside	Severe
Weighting	60%	15%	20%	5%
2025	1.14%	1.08%	1.19%	1.20%
2026	1.15%	0.96%	1.32%	1.37%
2027	1.15%	0.90%	1.41%	1.48%
2028	1.13%	0.88%	1.44%	1.50%
2029	1.12%	0.88%	1.42%	1.48%
Five-year peak	1.16%	1.13%	1.45%	1.51%

Weightings applied to the macroeconomic assumptions were approved at the December 2025

Assumptions Committee meeting. Following review of the inputs into the newly implemented

macroeconomic model, the weightings were updated to increase the upside from 15% to 20%

with a corresponding reduction in the downside.

Sensitivity analysis has been performed on the weightings, which shows that applying a 100%

weighting to the severe scenario would increase the ECL provision by £18.5m.

Provision: Vehicle finance compensation (note 26): £3.0m (2024: £nil)

The FCA is consulting on an industry-wide scheme to compensate motor finance customers who were

treated unfairly between 2007 and 2024. The scheme would cover regulated motor finance agreements

taken out between 6 April 2007 and 1 November 2024 where commission was payable by the lender

to the broker.

The FCA has defined these as cases involving an undisclosed contractual tie and commission equal

to, or greater than, 50% of the total cost of credit and 22.5% of the loan.

For all other cases, the FCA proposes consumers are compensated the average of what the FCA

estimates the consumer has overpaid, or lost, and the commission paid, plus interest.

The FCA’s consultation outlines a presumption of unfairness for motor finance agreements between

6 April 2007 and 1 November 2024 where:

5 discretionary commission arrangements (DCAs) were used;

5 high commission (where the commission is equal to or greater than 35% of the total cost of credit

and 10% of the loan) was paid; and

5 there was an exclusive or tied broker-lender relationship.

The Group did not participate in DCAs, nor did it enter into any exclusive or tied broker-lender

relationships (from initial review). The Group would therefore not be in scope for these elements of the

proposed FCA motor finance compensation scheme.

Key sources of estimation uncertainty

Significant challenge is expected to the consultation; therefore, a number of scenarios have been

included in the provision calculation and these have been probability weighted to determine an

appropriate provision to recognised.

The estimated provision represents management’s best estimate of the potential redress based on

current information available and using a range of potential scenarios. The final calculation may vary

due to the need to perform a detailed calculation once the final outcome of the scheme is known.

If the scheme proposals and assumptions included in the consultation are to be fully implemented,

an additional liability of £4.0m may arise, primarily due to increased operating costs associated with

customer outreach.

The provision assessment also excludes any potential costs in relation to FOS referrals. At this stage it

is not possible to reliably determine the number of customers that would go to FOS or the approach

FOS will take in applying their fees.

Other accounting judgements

EIR on loans and advances to customers – interest free or promotional periods

In accordance with IFRS 9, interest income is recognised in the income statement using the EIR

method for loans and advances to customers, including throughout interest-free promotional periods

when these are offered to customers.

The EIR is determined on inception as management’s best estimate of future cash flows based on

historical information, where available, and considers the repayment activity and the retention of the

customer interest-free balance after the end of the promotional period. As such, the EIR method

introduces estimation uncertainty, which, if the actual cash flows differ from that estimate, could

result in an adjustment to the carrying value of the asset that reflects the value of interest recorded.

The Group’s best estimate of the future cash flows is a profile running off over a period of seven

years. The interest-free promotional period is the most sensitive element of the total EIR methodology.

As at 31 December 2025, the Group reported an EIR adjustment in relation to Credit Cards loans and

advances to customers in respect of interest-free periods and upfront fees of £10.0m (2024: £2.1m).

Material accounting policy information continued

151 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Other accounting judgements continued

Intangibles (note 20)

Group: £65.0m (2024: £61.5m)

All intangible assets have been reviewed for impairment under IAS 36.

Following the sale of the Personal Loans business in 1H25, the assets associated with that product

were reviewed for impairment and subsequently written off. A charge of £1.2m has therefore been

recognised within discontinued operations.

In 2024, the Credit Cards mobile app was written off in full following a decision to rebuild this

functionality using a more efficient design and build approach leading to an overall better customer

experience. This resulted in a cost of £8.5m being recognised in 1H24 results.

In addition, assets expected to be replaced by the Gateway platform in 2026 were reviewed – a

small number of these assets were written off, and the useful economic lives of other assets were

reassessed in light of their expected retirement by the Gateway platform. The impact of these in FY24

results was not material.

No impairment was recognised in continuing operations in FY25.

Provisions: Customer remediation complaints (note 26)

Over the past two years, the Group has experienced elevated levels of customer compensation claims

submitted by claims management companies (CMCs). The majority of these claims were speculative

in nature, largely driven by unmerited CMC activity, and related to a wide range of different matters

primarily related to aspects of the lending process, with no common theme or systemic issue identified.

While lending related complaints represented most cases through 2024 and into early 2025, changes

in CMC behaviour following the introduction of the new FOS charging structure led to a shift in the

overall mix. By the end of the year a greater proportion of complaints fell within BAU/service

categories in 2025. During 2024, the increase in costs and provision resulted from higher than

expected FOS fees for cases not upheld by us, which were or were expected to subsequently be

submitted to FOS for adjudication.

Since the change in the FOS fee charging structure from 1 April 2025, the Group has seen negligible

CMC referrals to the FOS. This element of the provision has therefore been reduced in the year.

The total cost to the Group of customer remediation costs, including resource and FOS fees, which

relate to a wide range of different matters, amounts to £26.6m in 2025 (2024: £47.4m), with FOS fees

reducing £24.8m to £6.4m.

A provision of £1.8m (2024: £7.4m) is held at the balance sheet date for: (i) customer compensation

claims received where compensation may be paid but that have not yet been assessed, upheld or

compensation amounts agreed (£1.1m) (2024: £5.1m); and (ii) expected FOS fees for future claims that

may be referred (£0.7m) (2024: £2.3m).

The provision is determined based on the complaints volume pipeline at the period end, estimated

uphold complaint rates, and average compensation amounts for each complaint type based on

historical data.

Material accounting policy information continued

152 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Financial and capital risk management

Financial risk management

The Group’s activities expose it to a variety of financial risks, which can be categorised as credit risk,

funding and liquidity risk, market risk and capital risk. The objective of the Group’s risk management

and internal control framework is to identify and assess the risks facing the Group and to minimise

the potential adverse effects of these risks on the Group’s financial performance. Financial risk

management is overseen by the Risk Committee with day-to-day management delegated to the

Credit Risk Committee (CRC) and Assets and Liabilities Committee (ALCO) both of which met 10 times

during 2025.

Further details of the risk management and internal control framework are described on pages 54

to 61.

(a) Credit risk

Credit risk is the risk that the Group will suffer loss in the event that a customer or counterparty fails

to meet their contractual financial obligations.

(i) Amounts receivable from customers

The Group’s maximum exposure to credit risk on amounts receivable from customers as at

31 December 2025 was £2,691.5m (2024: £2,153.7m).

The Risk Committee has delegated responsibility to the Credit Risk Committee (CRC) for day-to-day

credit risk management. The CRC is responsible for setting the Credit Risk Policy and ensuring that the

approach to lending is within sound risk and financial parameters and key metrics are reviewed to

ensure compliance with policy.

A customer’s risk profile and credit lines are evaluated at the point of application and, for revolving

limits, at various times during the agreement. Internally generated scorecards based on historical

payment patterns and other behavioural characteristics of customers are used to assess the

applicant’s potential default risk and their ability to manage a specific credit line. For new customers,

the scorecards incorporate data from the applicant and sourced from external credit bureaux.

Certain policy rules, including customer profile, proposed loan size and vehicle type (where applicable),

are also assessed in the decisioning process, as well as affordability checks to ensure that, at the time

of application, the loan repayments are affordable. For existing customer lending, the scorecards

also incorporate data on actual payment performance and product utilisation, together with data

sourced from an external credit bureaux each month to refresh a customer’s payment performance

position with other lenders. Credit lines can go up as well as down according to risk assessment.

Arrears management is conducted by way of a combination of letters, inbound and outbound

telephony, SMS, email and outsourced debt collection agency activities. Contact is made with the

customer to discuss the reasons for non-payment and specific strategies are employed to support

the customer in returning to a good standing and retaining use of the vehicle (where applicable).

These include appropriate forbearance arrangements, or where the contract has become

unsustainable for the customer, an appropriate exit strategy is implemented.

(ii) Counterparty risk

Counterparty credit risk arises as a result of cash deposits and collateral placed with banks, reserves

held with the Bank of England (BoE) and exposures to UK Government bonds (gilts).

The Group’s maximum exposure to credit risk on bank and Government counterparties as at

31 December 2025 was £1,078.6m (2024: £1,017.7m).

Counterparty credit risk is managed by the ALCO and is governed by a Wholesale Counterparty

Credit Risk Policy, which ensures that the Group’s exposures are to high-quality counterparties with

the level of permitted exposure to a counterparty firmly linked to the strength of its credit rating. In

addition, there is a maximum exposure limit for all institutions, regardless of credit rating. This is linked

to the Group’s regulatory capital base, in line with the Group’s regulatory reporting requirements on

large exposures to the PRA.

(b) Funding and liquidity risk

Funding and liquidity risk is the risk that the Group will have insufficient financial resources available

to fulfil its operational plans and/or to meet its financial obligations as they fall due.

The Funding Plan, Internal Liquidity Adequacy Assessment Process (ILAAP), Recovery Plan and

Solvent Exit Analysis are approved by the Board with day-to-day management delegated to the

Treasury function, who discharges and informs the decision-making through the ALCO. The ALCO is

responsible for approving the Funding and Liquidity Risk Policy and monitoring funding and liquidity

risk metrics against limits set by the Board, including the Group’s ability to meeting regulatory

requirements, to ensure that the Group is able to continue to fund the growth of the business and

meet retail deposit and wholesale funding outflows.

The Group and Vanquis Bank are PRA-regulated institutions. They are required to maintain a liquid

asset portfolio of high-quality liquid assets (HQLA), a Liquid Asset Buffer (LAB) and other liquid

resources, determined by daily stress tests detailed in the Group and Bank ILAAP. The ILAAP

determines the liquid resources that must be maintained by the Group to meet the Overall Liquidity

Adequacy Rule (OLAR) and to ensure that it can meet its liabilities as they fall due.

Both the Group and Vanquis Bank are required to meet the liquidity coverage ratio (LCR). The LCR

requires institutions to hold a buffer of HQLA to meet net liquidity outflows during a 30-day period.

The Group and Vanquis Bank have developed systems and controls to monitor the LCR and report to

the PRA. As at 31 December 2025, the Group, on a consolidated basis, and Vanquis Bank, on an

individual basis, had an LCR of 306% (2024: 359%) and 271% (2024: 338%) respectively.

153 – Vanquis Banking Group plc Annual Report and Accounts 2025

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Financial risk management continued

(b) Funding and liquidity risk continued

As at 31 December 2025, the liquid asset portfolio, comprised of cash at the Bank of England and

investment securities (gilts), amounted to £1,001.2m (2024: £948.7m). HQLA have been in significant

surplus to the minimum regulatory requirements throughout 2025.

Whilst the Group has diversified its liquid assets to comprise reserves held with the Bank of England

and gilts, it continues to be significantly funded by its retail deposits, at 89.7% (December 2024: 92%)

of total funding, of which its offering has been diversified further to include Easy Access accounts as

well fixed-term.

Balances with central banks are immediately available, while investment securities can be readily

monetised, including by use of Bank of England liquidity facilities.

A maturity analysis of the undiscounted contractual cash flows of the Group’s financial liabilities is

shown below:

Financial liabilities

	Repayable				Over 5
	on demand	<1 year	1–2 years	2–5 years	years	Total
2025 – Group	£m	£m	£m	£m	£m	£m
Retail deposits	530.7	1,929.6	494.3	132.0	—	3,086.6
Bank and other borrowings:
– bank facilities	0.9	—	—	—	—	0.9
– securitisation	—	82.8	129.9	—	—	212.7
– Tier 2 capital	—	12.6	12.6	37.7	157.3	220.2
Total bank and other borrowings	0.9	95.4	142.5	37.7	157.3	433.8
Trade and other payables	—	45.1	—	—	—	45.1
Lease liabilities	—	5.0	6.3	8.7	3.2	23.2
Derivative financial
instruments	—	0.5	1.5	0.7	(0.1)	2.6
Total	531.6	2,075.6	644.6	179.1	160.4	3,591.3

	Repayable				Over 5
	on demand	<1 year	1–2 years	2–5 years	years	Total
2024 – Group	£m	£m	£m	£m	£m	£m
Retail deposits	780.9	1,165.2	414.6	144.2	—	2,504.9
Bank and other borrowings:
– bank facilities	1.1	—	—	—	—	1.1
– securitisation	—	11.2	78.6	127.2	—	217.0
– Tier 2 capital	—	17.8	17.8	53.3	244.4	333.3
– central bank facilities	—	5.1	—	—	—	5.1
Total bank and other borrowings	1.1	34.1	96.4	180.5	244.4	556.5
Trade and other payables	—	41.0	—	—	—	41.0
Lease liabilities	—	12.5	4.5	9.2	9.0	35.2
Derivative financial
instruments	—	5.8	(0.7)	0.1	—	5.2
Total	782.0	1,258.6	514.8	334.0	253.4	3,142.8

The unutilised Credit Card commitments are included in note 14.

	Repayable				Over 5
	on demand	<1 year	1–2 years	2–5 years	years	Total
2025 – Company	£m	£m	£m	£m	£m	£m
Bank and other borrowings:
– Tier 2 capital	—	12.6	12.6	37.7	157.3	220.2
Trade and other payables	—	13.0	—	—	—	13.0
Derivative financial
instruments	—	(2.2)	(0.6)	—	—	(2.8)
Total	—	23.4	12.0	37.7	157.3	230.4

	Repayable				Over 5
	on demand	<1 year	1–2 years	2–5 years	years	Total
2024 – Company	£m	£m	£m	£m	£m	£m
Bank and other borrowings:
– Tier 2 capital	—	17.8	17.8	53.3	244.4	333.3
Trade and other payables	—	18.0	—	—	—	18.0
Lease liabilities	—	4.7	0.8	2.4	4.8	12.7
Derivative financial
instruments	—	5.8	(0.5)	0.1	—	5.4
Total	—	46.3	18.1	55.8	249.2	369.4

Financial and capital risk management continued

154 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Financial risk management continued

Market risk is the risk of financial loss associated with adverse changes in the value of assets and

liabilities held by the Group due to movements in market factors such as foreign exchange risk,

interest rates (duration risk), customer behaviour (optionality risk) and the movement in rate spreads

across types of assets or liabilities (basis risk and credit spread risk).

The Group does not have a trading book and therefore is only exposed to non-traded market risk.

Market risk principally arises through Interest Rate Risk in the Banking Book (IRRBB) and the

management of assets to support liquidity requirements, including Credit Spread Risk in the Banking

Book (CSRBB). It comprises the sensitivity of the current and future net interest income and economic

value to movements in market interest rates. The major contributors to interest rate risk are:

5 the mismatch, or duration, between repricing dates of interest-bearing assets and liabilities;

5 basis risk or assets and liabilities repricing to different reference rates, for example, customer

asset and liability products repricing against BoE base rate and Sterling Overnight Index Average

(SONIA); and

5 customer optionality, for example the right to repay borrowing in advance of contractual

maturity dates.

Interest rate risk

Interest rate risk is the risk of potential loss through unhedged or mismatched asset and liability

positions that are sensitive to changes in interest rates. Primarily, the Group is at risk of a change in

external interest rates, which leads to an increase in the Group’s cost of borrowing without an

offsetting increase in revenue. The Group’s exposure to foreign exchange risk is de minimis.

Day-to-day management of market risk is delegated to the Treasury function, who discharges and

informs the decision-making through the ALCO. The ALCO is responsible for approving the Market Risk

Policy and monitoring the interest rate risk position, including the risk appetite metrics set for both

earnings at risk (EaR), market value sensitivity (MVS), economic value of equity and basis risk.

Treasury seeks to limit its net exposure to changes in interest rates. This is achieved through a

combination of diversified funding sources, including issuing fixed-rate debt and using derivative

financial instruments, such as interest rate swaps, to manage its exposures within approved limits.

Derivative financial instruments are not used for speculative purposes. The Group elects to apply fair

value hedge accounting for the majority of its risk management activity that uses derivatives.

The Group’s risk management and internal control framework for IRRBB continues to evolve in line

with updates in regulatory guidance on methods expected to be used by banks to measure, manage,

monitor and control such risks.

The Group measures market risks through a combination of economic value and earnings-based measures:

5 economic value (EV) – a range of parallel and non-parallel interest rate stresses are applied to

assess the change in market value from assets, liabilities and off-balance sheet items repricing at

different times; and

5 net interest income (NII) – impact on earnings from a range of interest rate stresses.

The Group monitors these measures on at least a monthly basis, which were as follows at 31 December:

	2025	2024
	£m	£m
Economic value sensitivity
+200bps parallel shift in yield curve	(2.1)	0.7
-200bps parallel shift in yield curve	10.7	8.2
Net interest income sensitivity (over 12-month period)
+100bps parallel shift in yield curve	(1.2)	1.1
-100bps parallel shift in yield curve	3.8	1.6

Exposures to structured entities

At 31 December 2025, the Group has in issue two securitisations to diversify its sources of funding.

As at the end of 2025, the Group has securitised a total £796.7m of receivables (2024: £839.1m), in

exchange for receiving £200.0m (2024: £200.0m) of funding from external sources, including £480.2m

of receivables in a wholly retained securitisation which is pledged as collateral with the BoE to

provide access to the Sterling Monetary Framework.

The Group holds an exposure to the performance of these vehicles in the form of retained notes and

has a contractual right to the variable returns of the vehicles. This risk is limited to the performance of

the underlying assets, which have not been derecognised in the financial statements. The Group has

no exposure to other contractual risks associated with the vehicles; no additional credit

enhancements have been provided beyond the exposure created by the retained notes.

	2025		2024
	Receivables	Notes in	Receivables	Notes in
	secured	issue	secured	issue
Vehicle	£m	£m	£m	£m
Oban Cards 2021-1 Holdings Limited	480.2	453.1	518.2	453.1
Moneybarn Financing Limited	316.5	316.5	320.9	320.9

(d) Capital risk

To support the delivery of the Group’s purpose, the Group operates a financial model that is founded

on investing in customer-led businesses offering attractive returns, which aligns an appropriate

capital structure focused on optimising shareholder value, in a safe and sustainable manner. The

Group’s objective in respect of capital risk management is to maintain an efficient and secure capital

structure and adequate buffer over the regulatory capital requirements set by the PRA .

Financial and capital risk management continued

155 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

The following table reconciles the Group’s equity to the regulatory capital resources for the Group.

	2025	2024
Regulatory capital (unaudited)	£m	£m
Total equity	487.3	441.2
Retirement benefit asset	(6.4)	(27.8)
Deferred tax on retirement benefit asset	1.6	7.0
Goodwill	(1.2)	(1.2)
Intangible assets	(65.0)	(61.5)
Deferred tax on intangible asset	4.5	4.9
Deferred tax assets not arising from temporary differences	(20.1)	(18.3)
Other financial instruments	(58.6)	—
Foreseeable distributions on other financial instruments	(0.8)	—
Common Equity Tier 1 capital	341.3	344.3
Additional Tier 1 capital	58.6	—
Tier 1 capital	399.9	344.3
Tier 2 capital	141.5	200.0
Total regulatory capital	541.4	544.3
Risk-weighted exposures	2,073.5	1,834.8
CET1 ratio	16.5%	18.8%
Total capital ratio	26.1%	29.7%

As part of the supervision by the PRA, the Group, consistent with other regulated financial institutions,

is required to make annual Pillar 3 disclosures, which complement Basel’s Pillar 1 and Pillar 2

frameworks. These disclosures set out information on the Group’s regulatory capital, risk exposures

and risk management processes. Pillar 3 disclosures for the Group, for the year ended 31 December

2025, are published as a separate document and are available on the Group’s website.

Financial risk management continued

(d) Capital risk continued

The Group’s Capital Risk Policy helps to ensure capital resources are sufficient to support planned

levels of growth. It also sets out the framework in which the Group aims to maintain a secure funding

and capital structure and establishes defined capital risk appetite. Adherence to the policy ensures

that the Group maintains minimum capital levels and the capital held at business levels is adequate

to support underlying requirements and growth in that business. Internal capital is allocated to

business lines and risk categories, calibrated to maximise return on equity while remaining within the

risk appetite. The distribution of dividends is aligned with the Group’s growth targets, whilst continuing

to meet the required capital levels in line with regulatory requirements and internal risk appetite.

The Group is subject to supervision by the PRA on a consolidated basis, as a group containing an

authorised bank. For regulatory purposes, the Company is designated as a CRR consolidation entity,

as defined by the PRA rulebook. As part of this supervision, the regulator will issue a total capital

requirement (TCR) setting the amount of regulatory capital which the Group is required to hold at all

times, in order to safeguard depositors from loss in the event of severe losses being incurred by the

Group. The minimum regulatory capital requirement imposed by the PRA on firms is the sum of the

TCR, the combined Capital Requirements Directive (CRD) buffer requirements as applicable and the

PRA buffer requirements as applicable. This requirement is set in accordance with the international

Basel 3 rules, issued by the Basel Committee on Banking Supervision (BCBS), which, following the

implementation of the Financial Services Act 2021 on 1 January 2022, are implemented through the

PRA rulebook.

Regulatory capital is monitored by the Board, the Risk Committee and ALCO. The Group regularly

forecasts regulatory capital requirements as part of its budgeting and strategic planning process

and the Company and the Group are required to report quarterly to the PRA on their level of

regulatory capital.

The minimum amount of regulatory capital held by the Group and Vanquis Bank Limited represents

the higher of the imposed requirement and their respective internal assessments of minimum capital

requirements based upon an assessment of risks facing the Group. As required by the PRA, under the

Basel III regulatory framework, the Company undertakes an Internal Capital Adequacy Assessment

Process (ICAAP). This considers all risks facing the business, including credit, operational, counterparty,

conduct, pension and market risks, and assesses the capital requirement for such risks in the event

of downside stresses should such requirement exceed that set out under the Pillar 1 framework.

The ICAAP is approved by the Risk Committee and the Board.

The Group complied with its externally imposed capital requirements during the current and prior year.

Financial and capital risk management continued

156 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

The impact of the 2024 Vehicle Finance receivables review, affecting both income and impairment,

has remained within the Vehicle Finance segment.

			2025
			Second
	Credit	Vehicle	Charge	Corporate
	Cards	Finance	Mortgages	Centre	Total
	£m	£m	£m	£m	£m
Interest income	370.8	123.9	28.4	44.1	567.2
Interest expense	(51.6)	(28.2)	(17.8)	(51.2)	(148.8)
Net interest income	319.2	95.7	10.6	(7.1)	418.4
Fee and commission income	35.6	—	1.0	1.7	38.3
Fee and commission expense	(2.3)	—	—	(0.2)	(2.5)
Net fee and commission income	33.3	—	1.0	1.5	35.8
Other income	—	—	—	0.7	0.7
Total income	352.5	95.7	11.6	(4.9)	454.9
Impairment charges	(139.6)	(41.5)	(0.7)	0.7	(181.1)
Risk-adjusted income	212.9	54.2	10.9	(4.2)	273.8
Operating costs	(174.7)	(66.9)	(5.5)	(18.4)	(265.5)
Statutory profit/(loss) before taxation
from continuing operations	38.2	(12.7)	5.4	(22.6)	8.3
Taxation					(0.3)
Statutory profit after taxation from continuing operations					8.0
Statutory profit after taxation from discontinued operations					0.7
Statutory profit after taxation					8.7

1 Segment reporting

IFRS 8 requires segment reporting to be based on the internal financial information reported to the

chief operating decision maker. The Group’s chief operating decision maker is deemed to be the

Group ExCo, whose primary responsibility is to support the CEO in managing the Group’s day-to-day

operations and analyse trading performance. The Group’s segments are set out below, which are the

segments reported in the Group’s management accounts used by the Group ExCo as the primary

means for analysing trading performance. The Group ExCo assesses profit performance using profit

before tax measured on a basis consistent with the disclosure in the Group financial statements.

During 1H25 the Group reviewed and reallocated interest income, interest expense and costs to

different product segments as reported under IFRS 8. As a result, all previous periods have been

represented onto a consistent basis. These changes do not constitute a change in accounting policy

and there is no impact on recognition, measurement or profit and loss in any period presented in this

report. This representation is a further step in Vanquis’ ongoing commitment to enhance disclosures

and to provide a more transparent reporting of the Group’s continuing operations by product.

Following the sale of the Personal Loans business, the Group now comprises four segments: the three

core lending products – Credit Cards, Vehicle Finance, and Second Charge Mortgages – and the

Corporate Centre. The Corporate Centre includes the residual performance of the Retail Savings

business, Treasury results after product allocations, Snoop, and other immaterial or central items.

To more accurately reflect the interest income and funding costs of each lending product, the Group

updated the following:

5 Interest income from non-product Treasury items has been moved from Credit Cards to the

Corporate Centre.

5 Interest expense to better represent the cost of funding across products using funds transfer

pricing, allowing for duration matching of assets and natural hedging across exposures. Interest

expense related to Tier 2 capital, previously reported entirely within the Corporate Centre, has

been partially reallocated to individual products and the cost of the Vehicle Finance

securitisation, previously allocated solely to Vehicle Finance, has been spread across all products,

reflecting shared benefit from the funding structure.

5 Operating costs that were not directly attributable to a product and previously held in the

Corporate Centre have been reallocated, based on either business size using a blended average

of credit risk-weighted assets (RWAs), to reflect capital consumption, or total income, to reflect

revenue contribution or service usage.

The Group has transitioned to reporting solely on a statutory basis. This follows actions taken in 2024

that resulted in a cleaner, lower-risk balance sheet and improved transparency at both Group and

product levels. Adjusted performance is now expected to closely align with statutory results.

Accordingly, the 2024 income statement and key metrics have been represented on a statutory basis,

removing adjustments for goodwill write-offs, transformation and other exceptional costs, and

amortisation of acquisition intangibles. The 2024 adjusting items, comprising the goodwill write-off,

transformation and other exceptional costs, and amortisation of acquisition intangibles, in addition to

other one-off cost items, have remained within the Corporate Centre.

Notes to the financial statements

157 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

1 Segment reporting continued

			2024 1
			Second
	Credit	Vehicle	Charge	Corporate
	Cards	Finance	Mortgages	Centre	Total
	£m	£m	£m	£m	£m
Interest income	365.7	133.1	4.8	46.3	549.9
Interest expense	(53.2)	(31.4)	(3.4)	(54.0)	(142.0)
Net interest income	312.5	101.7	1.4	(7.7)	407.9
Fee and commission income	36.7	—	—	1.6	38.3
Fee and commission expense	(1.7)	—	—	(0.2)	(1.9)
Net fee and commission income	35.0	—	—	1.4	36.4
Other income	—	—	—	2.1	2.1
Total income	347.5	101.7	1.4	(4.2)	446.4
Impairment charges	(123.9)	(60.4)	(0.2)	(0.8)	(185.3)
Risk-adjusted income	223.6	41.3	1.2	(5.0)	261.1
Operating costs	(193.5)	(80.1)	(0.6)	(124.9)	(399.1)
Statutory profit/(loss) before taxation
from continuing operations	30.1	(38.8)	0.6	(129.9)	(138.0)
Taxation					17.4
Statutory loss after taxation from continuing operations					(120.6)
Statutory profit after taxation from discontinued operations					1.3
Statutory loss after taxation					(119.3)

1 Refer to material accounting policy information for detail of the representation.

Revenue between business segments is not material.

		Segment assets		Segment liabilities		Net assets/(liabilities)
	2025	2024	2025	2024	2025	2024
Group	£m	£m	£m	£m	£m	£m
Credit Cards, Personal Loans and Second Charge Mortgages	3,165.4	2,514.8	(2,727.4)	(2,161.8)	438.0	353.0
Vehicle Finance	728.8	775.5	(615.4)	(646.4)	113.4	129.1
Corporate Centre	(41.2)	(2.6)	(22.9)	(38.3)	(64.1)	(40.9)
Total before intra-group elimination	3,853.0	3,287.7	(3,365.7)	(2,846.5)	487.3	441.2
Intra-group elimination	88.7	87.6	(88.7)	(87.6)	—	—
Total Group	3,941.7	3,375.3	(3,454.4)	(2,934.1)	487.3	441.2

The presentation of segment net assets reflects the statutory assets, liabilities and net assets of each

of the Group’s divisions. This results in an intra-group elimination reflecting the difference between the

central intercompany funding provided to the divisions and the external funding raised centrally.

Credit Cards, Personal Loans and Second Charge Mortgages are recognised within Vanquis Bank

Limited and are therefore combined for balance sheet reporting purposes.

The Group’s businesses operate principally in the UK.

		Capital expenditure	Depreciation		Amortisation
	2025	2024	2025	2024	2025	2024
Group	£m	£m	£m	£m	£m	£m
Credit Cards, Personal Loans and Second Charge Mortgages	16.0	12.7	1.7	1.4	8.7	8.2
Vehicle Finance	—	0.8	0.2	0.9	—	0.1
Corporate Centre	2.5	1.2	0.2	0.6	1.8	8.6
Total Group	18.5	14.7	2.1	2.9	10.5	16.9

Capital expenditure comprises expenditure on intangible assets of £15.2m (2024: £12.5m) and

property, plant and equipment of £3.3m (2024: £2.2m).

2 Discontinued operations

The Group sold its Personal Loans portfolio in March 2025 and in accordance with IFRS 5 Non-current

Assets Held for Sale and Discontinued Operations, this business segment is presented as discontinued

operations. The results from discontinued operations, which are included in the Group income

statement, are set out below.

	Group
	2025	2024
	£m	£m
Interest income	1.4	15.5
Interest expense	(0.3)	(3.4)
Net interest income	1.1	12.1
Fee and commission income	—	—
Fee and commission expense	—	—
Net fee and commission income	—	—
Other income	—	—
Total income	1.1	12.1
Impairment credit/(charges)	3.1	(5.7)
Risk-adjusted income	4.2	6.4
Operating costs	(3.3)	(4.7)
Statutory profit before taxation	0.9	1.7
Tax charge	(0.2)	(0.4)
Statutory profit after taxation	0.7	1.3

158 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

2 Discontinued operations continued

Following the Group’s strategy update in March 2024, management announced that the Personal

Loans business was under review and the loan portfolio was placed into run off. The Group

completed the sale of the Personal Loans portfolio in March 2025. On completion, the net receivables

disposed of totalled £34.8m, and the Company received net consideration of £37.8m.

A gain on disposal of £0.5m has been recognised, reflecting the difference between the consideration

received, the carrying amount of the net assets derecognised and disposal costs of £2.5m, including

a write down of associated intangible assets of £1.2m. The gain is presented within impairment

credits, partly offset by operating costs in the income statement for discontinued operations.

Cash generated from operations includes £9.1m (2024: £60.4m) from discontinued operations,

reflecting net cash generated from customer receivables and associated costs, and £37.8m of

consideration received on completion of the sale of the Personal Loans portfolio in March 2025.

There were no investing or financing cash flows relating to discontinued operations.

3 Interest income

	Group
	2025	2024 1
Interest receivable from:	£m	£m
Customer receivables (note 14)	523.0	502.8
Cash balances held on deposit and other (note 12)	37.9	44.8
Investment securities (note 13)	5.8	—
Net fair value gains on derivative financial instruments (note 23)	0.5	2.3
Total income from continuing operations	567.2	549.9
Total income from discontinued operations	1.4	15.5
Total interest income	568.6	565.4

1 Refer to material accounting policy information for detail of the representation.

Interest income from; (i) Credit Cards and Second Charge Mortgage customer receivables; (ii) cash

balances held on deposit and other; (iii) investment securities income; and (iv) income from

discontinued operations is calculated using the EIR method.

Interest income from Credit Cards and Second Charge Mortgage customer receivables is recognised

by applying the effective interest rate (EIR) to the carrying value of a loan. The EIR is calculated at

inception and represents the rate that exactly discounts the future contractual cash receipts from a

loan to the amount of cash advanced under that loan, plus directly attributable issue costs (e.g.

aggregator/broker fees).

Vehicle Finance interest income from customer receivables of £123.9m (2024: £133.1m) is recognised in

line with IFRS 16.

4 Interest expense

	Group
	2025	2024
Interest payable on:	£m	£m
Retail deposits	115.6	97.5
Tier 2	19.1	21.0
Securitisation	12.5	14.3
Bank of England facility	0.9	6.2
Lease liabilities finance costs	0.7	3.0
Total interest expense from continuing operations	148.8	142.0
Total interest expense from discontinued operations	0.3	3.4
Total interest expense	149.1	145.4

5 Net fee and commission income

Fee income is recognised at the time the charges are made to the customer on the basis the

performance obligation is complete.

	Group
	2025	2024
	£m	£m
Fee and commission income	38.3	38.3
Fee and commission expense	(2.5)	(1.9)
Net fee and commission income	35.8	36.4

Fee income predominantly relates to Credit Cards and reflects default and overlimit fees as well as

other ancillary income streams and interchange income.

159 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

6 Profit before taxation

	Group
	2025	2024 1
Profit before taxation is stated after charging/(crediting):	£m	£m
Amortisation of other intangible assets:
– computer software (note 20)	9.1	9.3
– acquisition intangibles (note 20)	1.3	6.2
Depreciation of property, plant and equipment (note 17)	2.1	2.9
Loss on disposal of property, plant and equipment (note 17)	0.3	0.3
Loss on disposal of intangibles (note 20)	—	—
Depreciation of right of use assets (note 18)	4.3	4.6
Impairment of right of use assets (note 18)	—	3.5
Lease liability finance costs (note 4)	0.7	3.0
Impairment of amounts receivable from customers (note 14)	181.8	184.1
Employment costs (note 11 (b))	119.7	121.7

1 Refer to material accounting policy information for detail of the representation.

All of the above activities relate to continuing activities.

	Group
	2025	2024
Auditor’s remuneration	£m	£m
Fees payable to the Company’s auditor for the audit of Company and consolidated financial statements	0.4	0.5
Fees payable to the Company’s auditor and its associates for other services:
– audit of Company’s subsidiaries pursuant to legislation	2.0	1.8
– other non-audit services	0.4	0.4
Total auditor’s remuneration	2.8	2.7

7 Tax

	2025	2024
Tax (charge)/credit in the income statement	£m	£m
Continuing operations:
Current tax – UK	0.2	3.7
Deferred tax (note 24) – UK	(0.5)	13.7
Total tax (charge)/credit in relation to continuing operations	(0.3)	17.4
Discontinued operations:
Current tax – UK	(0.2)	(0.4)
Deferred tax (note 24) – UK	—	—
Total tax charge in relation to discontinued operations	(0.2)	(0.4)
Total tax (charge)/credit	(0.5)	17.0

1 Refer to material accounting policy information for detail of the representation.

		2025			2024
	Continuing	Discontinued		Continuing	Discontinued
	operations	operations	Total	operations	operations	Total
	£m	£m	£m	£m	£m	£m
Profit/(loss) on ordinary
activities before tax	8.3	0.9	9.2	(138.0)	1.7	(136.3)
Profit/(loss) before tax
multiplied by standard rate
of corporation tax in the UK
of 25%	(2.1)	(0.2)	(2.3)	34.5	(0.4)	34.1
Effect of:
– impairment of deferred
tax assets (note (a))	0.8	—	0.8	(0.3)	—	(0.3)
– adjustments in respect
of prior years (note (b))	0.3	—	0.3	1.3	—	1.3
– amounts recognised in equity (note (c))	0.5	—	0.5	—	—	—
– non-taxable income
(note (d))	0.5	—	0.5	—	—	—
– non-deductible general
expenses (note (e))	(0.3)	—	(0.3)	(18.4)	—	(18.4)
– benefit of capital losses
(note (f))	—	—	—	1.1	—	1.1
– non-deductible asset
write-off (note (g))	—	—	—	(0.8)	—	(0.8)
Total tax (charge)/credit	(0.3)	(0.2)	(0.5)	17.4	(0.4)	17.0

1 Refer to material accounting policy information for detail of the representation.

(a) Impairment of deferred tax assets

In 2024, the tax charge in respect of the impairment of deferred tax assets of £0.3m related to share

scheme awards where future deductions were expected to be lower than previously anticipated and

other deferred tax assets that were not recognised. In 2025, the tax credit of £0.8m relates to the

reversal of previous impairments of deferred tax assets in respect of share scheme awards where

future deductions are now expected to be greater than previously anticipated.

(b) Adjustment in respect of prior years

In 2025, the tax credit of £0.3m (2024: tax credit of £1.3m) in respect of prior years comprises (a) a tax

charge of £0.8m due to a lower share price on vesting of share awards than originally anticipated,

net of (b) a tax credit of £1.1m relating to non-taxable releases of unpresented cheque accruals in

respect of the Repayment Option Plan remediation programme for which tax deductions were

previously not available due to the application of the bank compensation provisions.

160 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

8 Earnings/(loss) per share

Basic earnings/(loss) per share EPS/(LPS) is calculated by dividing the profit/(loss) for the year

attributable to equity shareholders by the weighted average number of ordinary shares outstanding

during the year less the number of shares held by the Employee Benefit Trust, which are used to

satisfy the Group’s share awards. Diluted EPS/(LPS) calculates the effect on EPS/(LPS) assuming

conversion of all dilutive potential ordinary shares. Dilutive potential ordinary shares are calculated

as follows:

(i) For share awards outstanding under performance-related share incentive schemes such as the

Deferred Bonus Plan (DBP), the Long Term Incentive Scheme (LTIS), the Restricted Share Plan (RSP)

and the Company Share Option Plan (CSOP), the number of dilutive potential ordinary shares is

calculated based on the number of shares that would be issuable if: (i) the end of the reporting

period is assumed to be the end of the schemes’ performance period; and (ii) the performance

targets have been met as at that date.

(ii) For share options outstanding under non-performance-related schemes such as the Save As You

Earn scheme (SAYE), a calculation is performed to determine the number of shares that could

have been acquired at fair value (determined as the average annual market share price of the

Company’s shares) based on the monetary value of the subscription rights attached to outstanding

share options. The number of shares calculated is compared with the number of share options

outstanding, with the difference being the dilutive potential ordinary shares.

Potential ordinary shares are treated as dilutive when, and only when, their conversion to ordinary

shares would decrease earnings per share or increase loss per share.

7 Tax continued

(b) Adjustment in respect of prior years continued

In 2024, the tax credit of £1.3m in respect of prior years comprises: (a) a £0.9m reinstatement of

deferred tax assets in respect of tax losses of discontinued operations previously written off that

have now been used to shelter prior year tax liabilities; (b) a £0.8m tax credit from claiming capital

allowances super deductions in prior years; (c) a tax charge of £0.8m due to lower tax deductions

in respect of share scheme awards as a result of a lower than anticipated share price on vesting;

and (d) a tax credit of £0.4m related to the finalisation of tax liabilities for prior periods.

The tax credit of £0.5m (2024: £nil) in respect of amounts recognised in equity represents the tax

benefit of interest on the AT1 notes and associated issue costs that have been recognised in equity

but that are deductible for tax purposes.

(d) Non-taxable income

The tax credit of £0.5m (2024: £nil) relates to non-taxable releases of unpresented cheque accruals

in respect of the Repayment Option Plan remediation programme for which tax deductions were

previously not available due to the application of the bank compensation provisions.

(e) Non-deductible general expenses

In 2025, these relate primarily to depreciation of assets that do not qualify for capital allowances

and other non-deductible costs. In 2024, they primarily relate to the write-off of goodwill on

consolidation and the adjustment to the consideration in respect of the acquisition of Snoop,

neither of which are deductible for tax purposes.

(f) Benefit of capital losses

The conversion and subsequent sale in 2024 of a further tranche of the preferred stock in Visa Inc

gave rise to capital gains, which were significantly offset by brought-forward capital losses in respect

of which a deferred tax asset was not previously recognised. This gave rise to a beneficial impact

on the tax charge in 2024 of £1.1m.

(g) Non-deductible asset write-offs

In 2024, a tax charge of £0.8m arose in respect of some of the write-offs of various assets and

legacy balance sheet items which are non-deductible for tax purposes.

The tax credit on items taken directly to other comprehensive income is as follows:

	Group
	2025	2024
	£m	£m
Deferred tax credit on actuarial movements on retirement benefit asset	5.5	2.9
Total tax credit on items taken directly to other comprehensive income	5.5	2.9

161 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

10 Directors’ remuneration

The remuneration of the directors, who are the key management personnel of the Group, is set out

below in aggregate for each of the categories specified in IAS 24 Related Party Disclosures.

		Group and Company
	2025	2024
	£m	£m
Salary and other benefits	2.7	2.4
Share-based payment charge	1.2	1.0
Total directors’ remuneration	3.9	3.4

Salary and other benefits comprise salary/fees, bonus, benefits earned in the year and pension

salary supplements for executive directors.

The share-based payment charge reflects the expected vesting of the Group’s share-based incentives.

11 Employee information

(a) Average monthly number of employees in the Group

	Group		Company
	2025	2024	2025	2024
Full time	1,151	1,248	107	162
Part time	128	127	11	11
Total	1,279	1,375	118	173

(b) Employment costs

	Group		Company
	2025	2024 1	2025	2024 1
	£m	£m	£m	£m
Aggregate gross wages and salaries paid to the Group’s employees	99.5	96.4	14.2	16.1
Employer’s National Insurance contributions	11.8	10.0	1.3	2.1
Pension charge	5.8	6.4	2.7	1.6
Share-based payment charge (note 31)	2.2	2.7	1.2	1.5
Redundancy costs	0.4	6.2	—	3.0
Total employment costs from continuing operations	119.7	121.7	19.4	24.3
Total employment costs from discontinued operations	—	1.1	—	—
Total employment costs	119.7	122.8	19.4	24.3

1 Refer to material accounting policy information for detail of the representation.

The pension charge comprises the retirement benefit charge for defined benefit schemes and

contributions to the stakeholder pension plan.

The share-based payment charge relates entirely to equity-settled schemes.

8 Earnings/(loss) per share continued

Reconciliations of basic and diluted EPS/(LPS) for the continuing operations and the Group are set

out below:

		2025			2024
		Weighted			Weighted
		average			average
		number of	Per share		number of	Per share
	Earnings	shares	amount	Loss	shares	amount
Continuing operations	£m	m	pence	£m	m	pence
Basic earnings/(loss)
per share	7.5	254.0	3.0	(120.6)	255.5	(47.2)
Dilutive effect of share
options and awards		12.4			—
Diluted earnings/(loss)
per share	7.5	266.4	2.8	(120.6)	255.5	(47.2)

		2025			2024
		Weighted			Weighted
		average			average
		number of	Per share		number of	Per share
	Earnings	shares	amount	Loss	shares	amount
Group	£m	m	pence	£m	m	pence
Basic earnings/(loss)
per share	8.2	254.0	3.2	(119.3)	255.5	(46.7)
Dilutive effect of share
options and awards		12.4			—
Diluted earnings/(loss)
per share	8.2	266.4	3.1	(119.3)	255.5	(46.7)
The EPS for discontinued operations in 2025 was 0.3p (2024: 0.5p) and diluted EPS was 0.3p
(2024: 0.5p).

9 Dividends

	Group
	2025	2024
	£m	£m
2023 – final 1.0p per share	—	2.5
Dividends paid	—	2.5

The directors are not recommending a final dividend in respect of the financial year ended

31 December 2025.

162 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

12 Cash and cash equivalents

Cash and cash equivalents includes cash at bank and held in short-term deposits and Vanquis Bank

Limited’s liquid asset buffer, including other liquid resources.

	Group		Company
	2025	2024	2025	2024
	£m	£m	£m	£m
Central bank reserves	746.8	948.7	—	—
Cash at bank	57.7	55.2	4.3	10.5
Total cash and cash equivalents	804.5	1,003.9	4.3	10.5

In addition to cash and cash equivalents, the Group had £0.9m of bank overdrafts at 31 December 2025

(2024: £1.0m) and the Company had £nil bank overdrafts (2024: £nil), both of which are disclosed within

bank and other borrowings (see note 28).

All cash and cash equivalents are held with investment grade rated banks and are held in Pound sterling.

Vanquis Bank Limited’s total liquid asset buffer is held in the Bank of England central reserve account

and amounted to £746.8m at 31 December 2025 (2024: £948.7m).

Cash and cash equivalents of £51.1m (2024: £45.1m), held as part of securitisations, is not immediately

available due to the terms of the arrangements.

Cash and cash equivalents are non-interest bearing other than in respect of the cash held on deposit

and the amounts held by Vanquis Bank Limited as a liquid asset buffer and other liquid resources

that bear interest at rates linked to the Bank of England base rate.

13 Investment securities

The Group’s investment securities comprise UK Government securities (gilts) which are held as part of

Vanquis Bank’s liquidity buffer.

	Principal amount		Carrying value
	2025	2024	2025	2024
	£m	£m	£m	£m
UK Government securities	250.0	—	253.3	—
Fair value adjustment for portfolio hedged risk (note23)	—	—	1.3	—
	250.0	—	254.6	—

All the gilts bear credit risk and are classified as Stage 1 exposures for IFRS 9 impairment purposes.

As the securities are UK sovereign exposures, the Probability of Default has been assessed to be so

low that no significant impairment provision is required.

The gilts bear interest at a fixed rate, the average maturity of the gilts is 2.9 years (2024: n/a), and

the average fixed rate coupon is 4.15% (2024: n/a). Hedging arrangements in respect of these

securities are described in note 23 .

14 Amounts receivable from customers

		2025			2024
	Due	Due in		Due	Due in
	within	more than		within	more than
	one year	one year	Total	one year	one year	Total
	£m	£m	£m	£m	£m	£m
Credit Cards	1,384.3	—	1,384.3	1,149.9	—	1,149.9
Vehicle Finance	213.4	475.1	688.5	227.5	507.9	735.4
Second Charge Mortgages	—	618.5	618.5	—	225.3	225.3
Total	1,597.7	1,093.6	2,691.3	1,377.4	733.2	2,110.6
Discontinued operations	—	—	—	9.7	34.3	44.0
Fair value adjustment for portfolio
hedged risk (note 23)	(0.2)	0.4	0.2	(0.8)	(0.1)	(0.9)
Total reported amounts receivable
from customers	1,597.5	1,094.0	2,691.5	1,386.3	767.4	2,153.7

The fair value adjustment for the portfolio hedged risk relates to the Second Charge Mortgages

receivable and the unamortised hedged accounting adjustment in relation to the balance

guaranteed swap, where hedge accounting has been discontinued (see note 23).

The gross amounts receivable from customers and allowance account which form the net amounts

receivable from customers are as follows:

			2025
			Second
	Credit	Vehicle	Charge	Total	Discontinued
	Cards	Finance	Mortgages	continuing operations		Group
Group	£m	£m	£m	£m	£m	£m
Gross amounts receivable
from customers	1,553.8	761.6	619.4	2,934.8	—	2,934.8
Allowance account	(169.5)	(73.1)	(0.9)	(243.5)	—	(243.5)
Reported amounts receivable
from customers	1,384.3	688.5	618.5	2,691.3	—	2,691.3
			2024
			Second
	Credit	Vehicle	Charge	Total	Discontinued
	Cards	Finance	Mortgages	continuing operations		Group
Group	£m	£m	£m	£m	£m	£m
Gross amounts receivable
from customers	1,309.9	831.9	225.5	2,367.3	49.1	2,416.4
Allowance account	(160.0)	(96.5)	(0.2)	(256.7)	(5.1)	(261.8)
Reported amounts receivable
from customers	1,149.9	735.4	225.3	2,110.6	44.0	2,154.6

The Group has pledged £796.7m (2024: £839.1m) of receivables as collateral under the securitisation

funding arrangements described in note 28.

163 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

14 Amounts receivable from customers continued

Credit Cards

Amounts receivable from customers for Credit Cards can be reconciled as follows:

		2025				2024 (represented) 1
	Stage 1	Stage 2	Stage 3	Total	Stage 1	Stage 2	Stage 3	Total
Credit Cards	£m	£m	£m	£m	£m	£m	£m	£m
Gross carrying amount
At 1 January	1,136.6	99.8	73.5	1,309.9	1,199.5	161.2	114.1	1,474.8
Originations	116.9	—	—	116.9	21.9	—	—	21.9
Drawdowns	2,131.0	64.7	5.1	2,200.8	2,000.2	76.5	8.5	2,085.2
Net transfers and changes in credit risk:
– from Stage 1 to Stage 2	(333.8)	333.8	—	—	(376.7)	376.7	—	—
– from Stage 1 to Stage 3	(41.2)	—	41.2	—	(44.9)	—	44.9	—
– from Stage 2 to Stage 1	187.3	(187.3)	—	—	290.1	(290.1)	—	—
– from Stage 2 to Stage 3	—	(122.9)	122.9	—	—	(158.6)	158.6	—
– from Stage 3 to Stage 1	10.7	—	(10.7)	—	16.7	—	(16.7)	—
– from Stage 3 to Stage 2	—	3.5	(3.5)	—	—	5.9	(5.9)	—
Write-offs	(14.6)	(12.4)	(19.2)	(46.2)	(11.7)	(9.6)	(36.4)	(57.7)
Write-offs (debt sale)	—	—	(127.2)	(127.2)	—	—	(157.7)	(157.7)
Repayments	(2,212.9)	(82.4)	(24.9)	(2,320.2)	(2,320.5)	(107.1)	(31.1)	(2,458.7)
Interest and fee income	360.7	44.2	1.5	406.4	352.9	46.6	2.9	402.4
Other movements	10.8	(1.9)	4.5	13.4	9.1	(1.7)	(7.7)	(0.3)
At 31 December	1,351.5	139.1	63.2	1,553.8	1,136.6	99.8	73.5	1,309.9
Allowance account
At 1 January	(73.3)	(44.7)	(42.0)	(160.0)	(84.7)	(57.5)	(54.9)	(197.1)
Movements through income statement:
Originations	(21.1)	—	—	(21.1)	(4.8)	—	—	(4.8)
Drawdowns and net
transfers and changes
in credit risk:
– from Stage 1 to Stage 2	57.7	(57.7)	—	—	66.2	(66.2)	—	—
– from Stage 1 to Stage 3	6.0	—	(6.0)	—	7.0	—	(7.0)	—
– from Stage 2 to Stage 1	(66.0)	66.0	—	—	(94.3)	94.3	—	—
– from Stage 2 to Stage 3	—	76.3	(76.3)	—	—	108.5	(108.5)	—
– from Stage 3 to Stage 1	(3.8)	—	3.8	—	(5.1)	—	5.1	—
– from Stage 3 to Stage 2	—	(1.2)	1.2	—	—	(2.5)	2.5	—
– remeasurements
within existing stage	8.6	(102.3)	(28.4)	(122.1)	21.7	(107.5)	(35.7)	(121.5)
– post-model overlays	2.6	9.8	3.2	15.6	19.0	(20.1)	(2.5)	(3.6)
– write-offs	(13.3)	(5.8)	(5.7)	(24.8)	(9.9)	(3.3)	(6.6)	(19.8)
– debt sales	—	—	4.7	4.7	—	—	16.1	16.1

– derecognition of

Stage 3 interest — — 2.2 2.2 — — 3.3 3.3

2025 2024 (represented)

Credit Cards

Stage 1

£m

Stage 2

£m

Stage 3

£m

Total

£m

Stage 1

£m

Stage 2

£m

Stage 3

£m

Total

£m

– recoveries — — 3.7 3.7 — — 3.1 3.1

– revaluations — — 2.6 2.6 — — 3.2 3.2

– other movements — — (0.4) (0.4) — — 0.1 0.1

Total movements

through income

statement (29.3) (14.9) (95.4) (139.6) (0.2) 3.2 (126.9) (123.9)

Movements through

allowance account:

– write-offs (regular) 14.9 12.4 19.2 46.5 12.0 9.7 36.4 58.1

– write-offs (debt sale) — — 130.1 130.1 — — 173.2 173.2

– debt sale proceeds — — (38.4) (38.4) — — (60.6) (60.6)

– derecognition of

Stage 3 interest — — (2.2) (2.2) — — (3.3) (3.3)

– other — — (5.9) (5.9) (0.4) (0.1) (5.9) (6.4)

Allowance account

at 31 December (87.7) (47.2) (34.6) (169.5) (73.3) (44.7) (42.0) (160.0)

Reported amounts

receivable from

customers at

31 December 1,263.8 91.9 28.6 1,384.3 1,063.3 55.1 31.5 1,149.9

Reported amounts

receivable from

customers at 1 January 1,063.3 55.1 31.5 1,149.9 1,114.8 103.7 59.2 1,277.7

1 Drawdowns, net transfers and changes in credit risk in the allowance account reconciliation have been represented to show direct

ECL transfers between stages at point of transfer, with remeasurements within existing stage reflecting subsequent allowance

changes and balance movements.

In the amounts receivable from customers reconciliation above:

5 originations relate to the closing gross carrying and allowance amounts in the first month of

being a new customer;

5 other movements to gross carrying amount primarily relate to recognition of deferred acquisition

costs; and

5 remeasurements within existing stage capture both allowance changes arising from stage

transfers and those driven by balance movements.

Total Credit Cards interest and fee income from customers of £406.4m (2024: £402.4m) comprises

£370.8m (2024: £365.7m) interest income and £35.6m (2024: £36.7m) of fee and commission income.

As at 31 December 2025 unutilised Credit Card commitments were £1,871.5m (2024: £1,476.3m).

An increase of 1% of the gross exposure into Stage 2 from Stage 1 would result in an increase in the

allowance account of £3.7m (2024: £4.3m) based on applying the difference between the coverage

ratios from Stage 1 to Stage 2 to the movement in gross exposure.

164 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

14 Amounts receivable from customers continued

Credit Cards continued

A breakdown of the in-model and post-model overlays for Credit Cards is shown below:

	2025	2024
Credit Cards	£m	£m
Core model	173.2	155.6
Post-model overlays	(3.7)	4.4
Total allowance account	169.5	160.0

	2025	2024
	£m	£m
Post-model overlays:
Persistent debt (note (a))	(2.8)	—
Balance transfer new originations (note (b))	(2.3)	—
Loss Given Default calibration (note (c))	1.4	—
Macroeconomic model redevelopment (note (d))	—	4.0
Other	—	0.4
Total post-model overlays	(3.7)	4.4

(a) Persistent debt

As part of ongoing model enhancements, a review of persistent debt accounts at 36 months was

undertaken. The Exposure at Default (EAD) framework was recalibrated to better reflect expected

balance and utilisation at default for these accounts.

(b) Balance transfer (BT) new originations

A calibration was required for newer lower-risk BT accounts as the observed default rates were lower

than the model was predicting. The overlay adjusts the 12-month Probability of Default for these

accounts in Stage 1.

A LGD refresh was performed to calibrate expected cash recoveries to latest available data.

(d) Macroeconomic model redevelopment

The macroeconomic model has been redeveloped and the model overlay released.

A breakdown of the gross receivable by internal credit risk rating is shown below:

		2025				2024 (represented) 1
	Stage 1	Stage 2	Stage 3	Total	Stage 1	Stage 2	Stage 3	Total
Credit Cards	£m	£m	£m	£m	£m	£m	£m	£m
Good	1,170.5	104.4	—	1,274.9	995.9	70.0	—	1,065.9
Satisfactory	181.0	34.7	—	215.7	140.7	29.8	—	170.5
Lower quality	—	—	63.2	63.2	—	—	73.5	73.5
Total	1,351.5	139.1	63.2	1,553.8	1,136.6	99.8	73.5	1,309.9

1 2024 represented to align with internal credit risk ratings adopted in 2025 .

Internal credit risk rating is based on probability of default metrics, aligned to internal

management reporting.

Vehicle Finance

Amounts receivable from customers for Vehicle Finance can be reconciled as follows:

		2025				2024 (represented) 1
	Stage 1	Stage 2	Stage 3	Total	Stage 1	Stage 2	Stage 3	Total
Vehicle Finance	£m	£m	£m	£m	£m	£m	£m	£m
Gross carrying amount
At 1 January	606.3	120.1	105.5	831.9	391.7	224.8	527.7	1,144.2
Originations	295.2	—	—	295.2	311.1	—	—	311.1
Transfers due to changes in credit risk:
– from Stage 1 to Stage 2	(303.1)	303.1	—	—	(63.6)	63.6	—	—
– from Stage 1 to Stage 3	(16.2)	—	16.2	—	(22.0)	—	22.0
– from Stage 2 to Stage 1	173.4	(173.4)	—	—	125.8	(125.8)	—	—
– from Stage 2 to Stage 3	—	(95.7)	95.7	—	—	(15.9)	15.9	—
– from Stage 3 to Stage 1	1.7	—	(1.7)	—	38.3	—	(38.3)	—
– from Stage 3 to Stage 2	—	11.4	(11.4)	—	—	41.7	(41.7)	—
Write-offs	(7.9)	(3.1)	(74.5)	(85.5)	—	—	(374.9)	(374.9)
Repayments	(308.8)	(63.7)	(57.3)	(429.8)	(279.8)	(97.8)	(74.7)	(452.3)
Interest and fee income	88.9	30.4	4.6	123.9	72.2	30.3	30.6	133.1
Other movements	26.9	0.3	(1.3)	25.9	32.6	(0.8)	38.9	70.7
At 31 December	556.4	129.4	75.8	761.6	606.3	120.1	105.5	831.9
Allowance account
At 1 January	(18.2)	(21.5)	(56.8)	(96.5)	(18.2)	(27.0)	(322.9)	(368.1)
Movements through income statement:
– originations	(25.9)	—	—	(25.9)	(40.0)	—	—	(40.0)
Drawdowns and net
transfers and changes
in credit risk:
– from Stage 1 to Stage 2	16.4	(16.4)	—	—	15.9	(15.9)	—	—
– from Stage 1 to Stage 3	0.6	—	(0.6)	—	1.9	—	(1.9)	—
– from Stage 2 to Stage 1	(24.1)	24.1	—	—	(38.8)	38.8	—	—
– from Stage 2 to Stage 3		23.6	(23.6)	—	—	27.3	(27.3)	—
– from Stage 3 to Stage 1	(0.1)	—	0.1	—	(11.1)	—	11.1	—
– from Stage 3 to Stage 2	—	(1.0)	1.0	—	—	(20.1)	20.1	—
– remeasurements
within existing stage	37.5	(31.7)	(17.6)	(11.8)	72.7	(23.6)	(73.5)	(24.4)
– post-model overlays	0.2	3.2	0.1	3.5	(0.6)	(1.0)	(3.9)	(5.5)

– write-offs — — (14.0) (14.0) — — (30.4) (30.4)

– debt sales — — (0.3) (0.3) — — 0.1 0.1

165 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

2025 2024 (represented)

Vehicle Finance

Stage 1

£m

Stage 2

£m

Stage 3

£m

Total

£m

Stage 1

£m

Stage 2

£m

Stage 3

£m

Total

£m

– derecognition of

Stage 3 interest — — 6.0 6.0 — — 18.5 18.5

– recoveries — — (2.7) (2.7) — — (0.2) (0.2)

– revaluations — — 3.7 3.7 — — 21.7 21.7

– other movements — — — — — — 0.2 0.2

Total amount recorded

in impairment charges 4.6 1.8 (47.9) (41.5) — 5.5 (65.5) (60.0)

Movements through

allowance account:

– write-offs — — 71.7 71.7 — — 374.9 374.9

– debt sale proceeds — — (11.9) (11.9) — — (6.7) (6.7)

– derecognition of

Stage 3 interest — — (6.0) (6.0) — — (18.5) (18.5)

– other changes — — 11.1 11.1 — — (18.1) (18.1)

Allowance account

at 31 December (13.6) (19.7) (39.8) (73.1) (18.2) (21.5) (56.8) (96.5)

Reported amounts

receivable from

customers at

31 December 542.8 109.7 36.0 688.5 588.1 98.6 48.7 735.4

Reported amounts

receivable from

customers at 1 January 588.1 98.6 48.7 735.4 373.5 197.8 204.8 776.1

1 Drawdowns, net transfers and changes in credit risk in the allowance account reconciliation have been represented to show direct

ECL transfers between stages at point of transfer, with remeasurements within existing stage reflecting subsequent allowance

changes and balance movements.

In the amounts receivable from customers reconciliation above:

5 other movements to gross carrying amount primarily relate to recognition of broker costs; and

5 remeasurements within existing stage capture both allowance changes arising from stage

transfers and those driven by balance movements.

Total Vehicle Finance interest and fee income from customers of £123.9m (2024: £133.1m) comprises

£123.9m (2024: £133.1m) interest income and £nil (2024: £nil) of other income.

An increase of 1% of the gross exposure into Stage 2 from Stage 1 would result in an increase in the

allowance account of £0.7m (2024: £0.9m) based on applying the difference between the coverage

ratios from Stage 1 to Stage 2 to the movement in gross exposure.

A breakdown of the in-model and post-model overlays for Vehicle Finance is shown below:

	2025	2024
Vehicle Finance	£m	£m
Core model	73.3	93.3
Post-model overlays	(0.2)	3.2
Total allowance account	73.1	96.5

	2025	2024
	£m	£m
Post-model overlays:
LGD recalibration (note (a))	2.3	(0.6)
Forced sale discount model calibration (note (b))	(1.1)	—
Stage 2 SICR recalibration (note (c))	(1.0)	—
12-month PD recalibration (note (d))	—	2.8
Macroeconomic LGD implementation (note (e))	—	(0.9)
Macroeconomic model redevelopment (note (f))	—	1.4
Other	(0.4)	0.5
Total post-model overlays	(0.2)	3.2

(a) LGD recalibration

Following the introduction of the charge-off process and the revised definition of default during 2024,

calibrations were required to components of the LGD model. A PMA has been recognised until the

model can be updated.

(b) Forced sale discount (FSD) model calibration

The external car valuations used in the FSD model were revised at the end of 2025. The input data

used in the model therefore needs to be calibrated to the revised valuations. A PMA has been

recognised until the model can be updated.

A new acquisition scorecard was implemented during the year, the SICR threshold therefore need to

be calibrated to appropriately move accounts into Stage 2 when they breach the SICR thresholds.

A PMA has been recognised until the model can be updated.

(d) 12-month PD recalibration

Monitoring of the 12-month PD model indicated a recalibration was required for the ‘up-to-date’

segment. The PMA was removed as the changes were reflected into the models.

14 Amounts receivable from customers continued

Vehicle Finance continued

166 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

Second Charge Mortgages

Amounts receivable from customers for Second Charge Mortgages can be reconciled as follows:

		2025
	Stage 1	Stage 2	Stage 3	Total
	£m	£m	£m	£m
Gross carrying amount
At 1 January	224.2	1.2	0.1	225.5
Originations	440.7	—	—	440.7
Net transfers and changes in credit risk:
– from Stage 1 to 2	(5.4)	5.4	—	—
– from Stage 1 to 3	(1.4)	—	1.4	—
Repayments	(91.5)	(0.6)	(0.2)	(92.3)
Interest income	28.1	0.3	—	28.4
Other movements	16.9	0.2	—	17.1
At 31 December	611.6	6.5	1.3	619.4
Allowance account
At 1 January	(0.1)	(0.1)	—	(0.2)
Movements through income statement:
Originations	(0.2)	—	—	(0.2)
Net transfers and changes in credit risk:
– remeasurements within stages	—	(0.4)	(0.1)	(0.5)
Total movement through income statement	(0.2)	(0.4)	(0.1)	(0.7)
Allowance account at 31 December	(0.3)	(0.5)	(0.1)	(0.9)
Reported amounts receivable from customers at 31 December	611.3	6.0	1.2	618.5
Reported amounts receivable from customers at 1 January	224.1	1.1	0.1	225.3

14 Amounts receivable from customers continued

(e) Macroeconomic LGD implementation

Refinements were made to the macroeconomic LGD model implementation to: (i) reflect an upside

scenario; (ii) refine the shape of the scenarios; and (iii) enhance how the scenarios were being applied.

The PMA was released as the changes were reflected into the models.

(f) Macroeconomic model redevelopment

The macroeconomic model has been redeveloped and the model overlay released.

A breakdown of the gross receivable by internal credit risk rating is shown below:

		2025				2024
	Stage 1	Stage 2	Stage 3	Total	Stage 1	Stage 2	Stage 3	Total
Vehicle Finance	£m	£m	£m	£m	£m	£m	£m	£m
Good quality	486.2	25.1	—	511.3	516.9	11.1	—	528.0
Satisfactory quality	69.6	36.9	—	106.5	78.9	35.8	—	114.7
Lower quality	0.6	35.5	—	36.1	10.4	39.7	—	50.1
Below standard	—	31.9	75.8	107.7	0.1	33.5	105.5	139.1
Gross carrying amount	556.4	129.4	75.8	761.6	606.3	120.1	105.5	831.9

Internal credit risk rating is based on the internal credit score of a customer at the balance sheet date.

Vehicle Finance accounts for its lease receivables under IFRS 16. As a result a maturity analysis of the

amounts receivable under the finance leases is required and is shown below:

	2025	2024
	£m	£m
Due within one year	370.7	397.7
Due within one to two years	300.9	316.1
Due within two to three years	222.8	255.6
Due within three to four years	137.6	146.2
Due between four to five years	45.1	45.8
Total	1,077.1	1,161.4
Unearned finance cost	(315.5)	(329.5)
Total lease receivable	761.6	831.9

No finance agreements entered into have a term greater than five years (2024: none over five years).

167 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

A breakdown of the gross Second Charge Mortgages receivable by internal credit risk rating is

shown below:

		2025
	Stage 1	Stage 2	Stage 3	Total
	£m	£m	£m	£m
Good	611.6	—	—	611.6
Satisfactory	—	6.5	—	6.5
Lower quality	—	—	1.3	1.3
Total	611.6	6.5	1.3	619.4

		2024
	Stage 1	Stage 2	Stage 3	Total
	£m	£m	£m	£m
Good	224.2	—	—	224.2
Satisfactory	—	1.2	—	1.2
Lower quality	—	—	0.1	0.1
Total	224.2	1.2	0.1	225.5

Low-quality receivables relate to defaulted accounts and are therefore assigned as Stage 3;

satisfactory receivables consist of non-defaulted accounts in arrears; high-quality receivables consist

of accounts not in arrears.

The movement in directly attributable acquisition costs included within amounts receivable from

customers can be analysed as follows:

		2025				2024
			Second				Second
	Credit	Vehicle	Charge	Total	Credit	Vehicle	Charge	Total
	Cards	Finance	Mortgages	Continuing	Cards	Finance	Mortgages	Continuing
Group	£m	£m	£m	£m	£m	£m	£m	£m
Brought forward	25.5	49.7	8.4	83.6	32.3	56.0	0.1	88.4
Capitalised	11.6	28.1	16.2	55.9	5.8	31.6	9.2	46.6
Amortised	(8.6)	(28.5)	(4.6)	(41.7)	(12.6)	(31.4)	(0.9)	(44.9)
Written off	—	(3.8)	—	(3.8)	—	(6.5)	—	(6.5)
Carried forward	28.5	45.5	20.0	94.0	25.5	49.7	8.4	83.6
DAC asset
(discontinued
operations)				—				0.4
Total DAC asset				94.0				84.0

14 Amounts receivable from customers continued

Second Charge Mortgages continued

		2024
	Stage 1	Stage 2	Stage 3	Total
	£m	£m	£m	£m
Gross carrying amount
At 1 January	2.8	—	—	2.8
Originations	217.7	—	—	217.7
Net transfers and changes in credit risk:	—	—	—	—
– from Stage 1 to 2	(1.2)	1.2	—	—
– from Stage 1 to 3	(0.1)	—	0.1	—
Repayments	(8.9)	—	—	(8.9)
Interest income	4.8	—	—	4.8
Other movements	9.1	—	—	9.1
At 31 December	224.2	1.2	0.1	225.5
Allowance account
At 1 January	—	—	—	—
Movements through income statement:
Originations	(0.1)	—	—	(0.1)
Net transfers and changes in credit risk:	—	—	—	—
– from Stage 1 to 2	—	(0.1)	—	(0.1)
Total movement through income statement	(0.1)	(0.1)	—	(0.2)
Allowance account at 31 December	(0.1)	(0.1)	—	(0.2)
Reported amounts receivable from customers at 31 December	224.1	1.1	0.1	225.3
Reported amounts receivable from customers at 1 January	2.8	—	—	2.8

Other movements in gross receivables predominantly relate to the capitalisation of deferred

acquisition costs.

Total Second Charge Mortgages interest and fee income from customers of £29.4m (2024: £4.8m)

comprises solely of interest income.

An increase of 1% of the gross exposure into Stage 2 from Stage 1 would result in an increase in the

allowance account of £0.5m (2024: £nil) based on applying the difference between the coverage

ratios from Stage 1 to Stage 2 to the movement in gross exposure.

There are no post-model overlays for Second Charge Mortgages in the current or prior year.

168 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

15 Trade and other receivables

	Group		Company
	2025	2024	2025	2024
	£m	£m	£m	£m
Trade and other receivables	2.6	—	—	—
Collateral	23.2	15.9	3.0	9.4
External counterparty loans	—	18.3	—	—
Stock	2.1	2.0	—	—
Finance lease receivable (note (a))	5.2	6.2	—	—
Amounts placed on deposit by Group undertaking	—	—	39.0	23.0
Amounts owed by Group undertakings	—	—	726.3	731.2
Prepayments	26.9	28.9	1.5	4.8
Accrued income	1.2	1.2	—	—
Total trade and other receivables	61.2	72.5	769.8	768.4

Amounts placed on deposit by Group undertaking represents funds placed on deposit via Vanquis

Bank with the Bank of England. On a Group basis these amounts are presented within cash and

cash equivalents.

Collateral represents cash collateral the Group has provided to its banking counterparties as security

against the mark-to-market exposure on its derivative financial instruments of £11.8m (2024: £9.4m)

and collateral required by Visa to support settlement activity of £11.4m (2024: £6.5m).

External counterparty loans represents the loan made to one of the Group’s Second Charge

Mortgage originators that was repaid during the year.

Stock represents vehicles held by Moneybarn where customer agreements have been terminated and

Credit Card plastics held by Vanquis Bank.

There are £nil amounts past due in respect of trade and other receivables (2024: £nil). An impairment

provision of £nil (2024: £1.2m) is held against external counterparty loans.

Amounts owed by Group undertakings are unsecured and repayable on demand or within one year,

and generally accrue interest at rates linked to SONIA. The Company has assessed the estimated

credit losses for these intercompany loans and an impairment provision of £nil (2024: £nil) has been

recognised. Amounts owed by Group undertakings consist of £726.3m (2024: £731.2m) categorised as

Stage 1 against which no provision is recognised. No amounts have been categorised as Stage 2 or

Stage 3. No provision has been recognised as the loan entities have sufficient expected cash flow to

service their obligations and/or sufficient realisable net assets to sell in the event of a default. There

has also been no quantitative or qualitative indicators of SICR.

14 Amounts receivable from customers continued

The impairment charge in respect of amounts receivable from customers can be analysed as follows:

	Group
	2025	2024
Impairment charge on amounts receivable from customers	£m	£m
Credit Cards	139.6	123.9
Vehicle Finance	41.5	60.0
Second Charge Mortgages	0.7	0.2
Total impairment charge from continuing operations	181.8	184.1
Total impairment (credit)/charge from discontinued operations	(3.1)	5.7
Total impairment charge	178.7	189.8

The impairment in the income statement of £181.1m (2024: £185.3m) includes £0.7m credit (2024: £0.8m

charge) in relation to loans held within trade and other receivables (note 15).

The average effective interest rate for the year ended 31 December 2025 was 26.6% for Credit Cards

(2024: 28.3%), 23% for Vehicle Finance (2024: 24%) and 8.1% for Second Charge Mortgages (2024: 8.9%).

The average period to maturity of the amounts receivable from customers within Vehicle Finance is 33

months (2024: 34 months) and within Second Charge Mortgages is 18.5 years (2024: 18.4 years). Within

Credit Cards, for the majority of customers, there is no fixed term for repayment other than a general

requirement for customers to make a monthly minimum repayment towards their outstanding balance.

This is currently the greater of 1% of the amount owed plus any fees and interest charges in the

month and £10.

169 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

16 Investments

	Group
	2025	2024
	£m	£m
Visa shares	2.4	2.3
Total investments	2.4	2.3

Visa shares

The Visa Inc shares represent preferred stock in Visa Inc held by Vanquis Bank Limited. The valuation

of the preferred stock has been determined using the common stock’s value as an approximation

as both classes of stock have similar dividend rights. However, adjustments have been made for:

(i) illiquidity, as the preferred stock is not tradeable on an open market and can only be transferred

to other Visa members; and (ii) future litigation costs that could affect the valuation of the stock prior

to conversion.

17 Property, plant and equipment

	Leasehold	Equipment
	land and	and
	buildings	vehicles	Total
Group	£m	£m	£m
Cost
At 1 January 2025	8.1	21.8	29.9
Additions	2.1	1.2	3.3
Disposals	(0.2)	(12.0)	(12.2)
At 31 December 2025	10.0	11.0	21.0
Accumulated depreciation and impairment
At 1 January 2025	2.6	20.2	22.8
Charged to the income statement – depreciation	0.8	1.3	2.1
Reclassification between asset classes	2.5	(2.5)	—
Disposals	(0.2)	(11.7)	(11.9)
At 31 December 2025	5.7	7.3	13.0
Net book value at 31 December 2025	4.3	3.7	8.0
Net book value at 1 January 2025	5.5	1.6	7.1

The loss on disposal of property, plant and equipment in 2025 amounted to £0.3m (2024: £0.3m).

The loss comprised proceeds received of £nil (2024: £nil) less the net book value of disposals of £0.3m

(2024: £0.3m).

15 Trade and other receivables continued

(a) Finance lease receivable

In 2022, the Group entered into a finance lease arrangement to sub-lease 50% of the existing floor

space of its London office. As a result, the Group recognises a lease receivable, representing the

amount of the Group’s net investment outstanding in respect of the finance lease; 50% of the

corresponding right of use asset was also derecognised (see note 18).

A maturity analysis of the amounts receivable under the finance lease is shown below:

	Group
	2025	2024
	£m	£m
Due within one year	1.0	1.0
Due within one to two years	1.0	1.0
Due within two to three years	1.0	1.0
Due within three to four years	1.0	1.0
Due within four to five years	1.0	1.0
After five years	0.4	1.5
	5.4	6.5
Unearned finance costs	(0.2)	(0.3)
Total lease receivable	5.2	6.2

Undiscounted lease payments analysed as:

	2025	2024
	£m	£m
Recoverable after 12 months	4.4	5.5
Recoverable within 12 months	1.0	1.0
Total	5.4	6.5

Net investment in the lease analysed as:

	2025	2024
	£m	£m
Recoverable after 12 months	4.3	5.3
Recoverable within 12 months	0.9	0.9
Total	5.2	6.2

The finance lease arrangement does not include variable payments. The average effective interest

rate contracted approximates to 1.1% per annum.

No impairment provision has been recognised against the lease receivable.

170 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

The profit on disposal of property, plant and equipment in 2025 amounted to £nil (2024: £nil) and

represented proceeds received of £nil (2024: £nil) less the net book value of disposals of £nil (2024: £nil).

A review of the Company’s fixed asset register as part of a transfer of assets within the Group

identified a number of assets that were fully depreciated and had been disposed of.

	Leasehold	Equipment
	land and	and
	buildings	vehicles	Total
Company	£m	£m	£m
Cost
At 1 January 2024	0.2	12.2	12.4
Additions	—	—	—
Disposals	—	—	—
At 31 December 2024	0.2	12.2	12.4
Accumulated depreciation
At 1 January 2024	0.1	11.6	11.7
Charged to the income statement	—	0.2	0.2
Disposals	—	—	—
At 31 December 2024	0.1	11.8	11.9
Net book value at 31 December 2024	0.1	0.4	0.5
Net book value at 1 January 2024	0.1	0.6	0.7

18 Right of use assets

	Group		Company
	2025	2024	2025	2024
Group	£m	£m	£m	£m
Cost
At 1 January	74.1	72.8	24.5	23.8
Additions and revaluations	—	1.3	—	0.7
Transfers to Group companies	—	—	(9.7)	—
Disposals	(14.8)	—	(14.8)	—
At 31 December	59.3	74.1	—	24.5
Accumulated depreciation and impairment
At 1 January	57.7	49.6	17.1	12.9
Disposals	(14.8)	—	(14.8)	—
Transfers to Group companies	—	—	(3.6)	—
Charged to the income statement – continuing operations	4.3	4.6	1.3	1.3
Charged to the income statement – impairment	—	3.5	—	2.9
At 31 December	47.2	57.7	—	17.1
Net book value at 31 December	12.1	16.4	—	7.4
Net book value at 1 January	16.4	23.2	7.4	10.9

Lease liabilities are disclosed in note 27.

17 Property, plant and equipment continued

Additions in 2025 and 2024 principally comprise expenditure in respect of the routine replacement

of IT equipment.

A review of accumulated depreciation categorisation as part of a transfer of assets within the

Group led to reclassifications between asset classes to ensure accumulated depreciation and cost

categorisations were aligned. These changes did not affect total PPE balance presented on the

balance sheet in either 2025 and 2024.

	Leasehold	Equipment
	land and	and
	buildings	vehicles	Total
Group	£m	£m	£m
Cost
At 1 January 2024	8.3	21.9	30.2
Additions	—	2.2	2.2
Disposals	(0.2)	(2.3)	(2.5)
At 31 December 2024	8.1	21.8	29.9
Accumulated depreciation and impairment
At 1 January 2024	2.0	20.1	22.1
Charged to the income statement – depreciation	0.8	2.1	2.9
Disposals	(0.2)	(2.0)	(2.2)
At 31 December 2024	2.6	20.2	22.8
Net book value at 31 December 2024	5.5	1.6	7.1
Net book value at 1 January 2024	6.3	1.8	8.1

	Leasehold	Equipment
	land and	and
	buildings	vehicles	Total
Company	£m	£m	£m
Cost
At 1 January 2025	0.2	12.2	12.4
Additions	1.9	—	1.9
Transfers to Group companies	(1.9)	(0.9)	(2.8)
Disposals	(0.2)	(11.3)	(11.5)
At 31 December 2025	—	—	—
Accumulated depreciation
At 1 January 2025	0.1	11.8	11.9
Charged to the income statement – depreciation	0.1	0.1	0.2
Transfers to Group companies	—	(0.6)	(0.6)
Disposals	(0.2)	(11.3)	(11.5)
At 31 December 2025	—	—	—
Net book value at 31 December 2025	—	—	—
Net book value at 1 January 2025	0.1	0.4	0.5

171 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

20 Other intangible assets

		2025			2024
	Acquisition	Computer		Acquisition	Computer
	intangibles	software	Total	intangibles	software	Total
Group	£m	£m	£m	£m	£m	£m
Cost
At 1 January	86.1	82.1	168.2	86.1	85.1	171.2
Additions	—	15.2	15.2	—	12.5	12.5
Adjustment	—	(0.6)	(0.6)	—	—	—
Disposals	—	(5.7)	(5.7)	—	(15.5)	(15.5)
At 31 December	86.1	91.0	177.1	86.1	82.1	168.2
Accumulated amortisation
and impairment
At 1 January	76.6	30.1	106.7	70.4	26.4	96.8
Charged to the income
statement – amortisation	1.3	9.2	10.5	6.2	10.7	16.9
Charged to the income
statement – impairment	—	—	—	—	8.5	8.5
Adjustment	—	(0.6)	(0.6)	—	—	—
Disposals	—	(4.5)	(4.5)	—	(15.5)	(15.5)
At 31 December	77.9	34.2	112.1	76.6	30.1	106.7
Net book value at 31 December	8.2	56.8	65.0	9.5	52.0	61.5
Net book value at 1 January	9.5	52.0	61.5	15.7	58.7	74.4

Acquisition intangibles represent the fair value of the broker relationships arising on the acquisition of

Moneybarn in 2014 and internally generated Platform and technology in relation to Snoop in 2023.

The Moneybarn acquisition intangible asset was being amortised over an estimated useful life of 10

years; the asset was fully amortised in 2024.

The Snoop intangible asset comprised £10.1m of internally generated core platform and technology,

and £1.0m in relation to the ‘Snoop’ brand name arising on the acquisition of Snoop in 2023. These

are being amortised over nine and five years respectively.

Research and development expenditure recognised within operating costs during 2025 was £0.7m

(2024: £0.7m).

Additions to computer software in the year of £15.2m (2024: £12.5m) comprise £15.2m (2024: £12.5m)

of internally generated assets and £nil (2024: £nil) of externally purchased software.

Computer software amortisation charges of £9.2m (2024: £10.7m) include £0.2m (2024: £1.4m) which

relate to the discontinued Personal Loans portfolio.

The computer software loss on disposal of £1.2m (2024: £nil) related entirely to the discontinued

Personal Loans portfolio where the assets were written off in full and disposed. The loss comprised

proceeds received of £nil (2024: £nil) less the net book value of disposals of £1.2m (2024: £nil).

18 Right of use assets continued

Disposals in both the Group and the Company amounted to £14.8m (2024: £nil) and relate to the

cessation of a property lease for the Bradford Head Office which has been relocated.

The additions and revaluations in 2024 related to a revaluation of a property leases.

19 Goodwill

	Group
	2025	2024
	£m	£m
Cost
At 1 January	3.3	74.5
Additions	—	—
Write-off	(2.1)	(71.2)
At 31 December	1.2	3.3
Accumulated impairment
At 1 January	2.1	2.1
Write-off	(2.1)	—
At 31 December	—	2.1
Net book value at 31 December	1.2	1.2
Net book value at 1 January	1.2	72.4

Goodwill with a net book value of £1.2m in 2025 relates to the acquisition of Usnoop Limited in 2023.

Goodwill is tested annually for impairment, or more frequently if there are any indications that goodwill

might be impaired. The recoverable amount is determined from a value in use calculation. The key

assumptions used in the value in use calculation relate to the cash flows of the cash-generating unit,

discount rates and growth rates adopted.

Management adopts pre-tax discount rates that reflect the time value of money and the risks specific

to the business.

The cash flow forecasts are based on the most recent financial budgets approved by the Group

Board for the next five years and extrapolate cash flows for the following five years using a terminal

growth rate of 1.5% (2024: 2%). The rate used to discount the forecast cash flows is 13.1% (2024:

13.5%); this represents the Company’s risk-adjusted cost of capital. The pre-tax equivalent rate is

17.5% (2024: 18%).

Moneybarn goodwill was impaired in full in 2024 due to lower cash flows in the latest budget as the

Group prioritises capital deployment for growth into Second Charge Mortgages and Credit Cards in

the near term.

During 2025 the £2.1m of cost and accumulated impairment in relation to Cheque Exchange Limited

was written off following the decision to close the business.

172 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

Due to indicators of impairment, an investment valuation review was performed at the balance sheet

date for the investment held in Provident Financial Holdings Limited utilising the higher of the discounted

future cash flow forecasts of the underlying business or fair value. Whilst no impairment is required,

sensitivity analysis has been performed based on the assumptions used in the cash flow valuations.

A 100 bps movement in the discount rate would move the valuations by £84m. Sufficient headroom

would remain to not require impairment.

Impairment of £17.2m was recognised in relation to non-trading companies as part of the Group

reorganisation.

The cost, accumulated impairment losses and carrying value of investments at 31 December 2025 are

shown below:

		Accumulated
		impairment	Carrying
	Cost	losses	value
Company	£m	£m	£m
Provident Financial Holdings Limited	298.6	—	298.6
Provident Financial Group Limited	29.9	(29.9)	—
Provfin Limited	10.1	(10.1)	—
Other	3.0	(0.6)	2.4
Net book value at 31 December	341.6	(40.6)	301.0

The following are the subsidiary undertakings, which, in the opinion of the directors, principally affect

the profit or assets of the Group or are a guaranteeing subsidiary of the Group’s certain borrowings.

A full list of subsidiary undertakings in included in note 38. All subsidiaries are consolidated and

held directly by the Company except for those noted below, which are held by wholly owned

intermediate companies.

		Country of	Class	%
Company	Activity	incorporation	of capital	Holding
Vanquis Bank Limited	Financial services	England	Ordinary	100 1
Moneybarn No. 1 Limited	Financial services	England	Ordinary	100 1
Provident Financial Holdings Limited	Intermediate holding company	England	Ordinary	100

1 Shares held by wholly owned intermediate companies.

The above companies operate principally in their country of incorporation.

20 Other intangible assets continued

The £15.2m (2024: £12.5m) of internally generated assets predominantly relates to the development of the

Gateway platform. The net book value of this asset is £50.7m as at 31 December 2025 and it is being

amortised over an estimated useful life of 10 years from the date each component is available for use.

A review of costs and accumulated amortisation as part of a transfer of assets within the Group led to

an adjustment of £0.6m between costs and accumulated amortisation. These changes did not affect the

total other intangible assets balance presented on the balance sheet in either 2025 and 2024.

21 Investment in subsidiaries

	Company
	2025	2024
	£m	£m
Cost
At 1 January	349.7	265.3
Additions	70.3	85.9
Disposals	(78.4)	(1.5)
At 31 December	341.6	349.7
Accumulated impairment losses
At 1 January	101.8	23.7
Charge to the income statement	17.2	78.5
Disposals	(78.4)	(0.4)
At 31 December	40.6	101.8
Net book value at 31 December	301.0	247.9
Net book value at 1 January	247.9	241.6

The additions in 2025 relate to: (i) a £60m subscription for Additional Tier 1 (AT1) capital issued by

Vanquis Bank Limited following the Group’s external issuance of AT1 in October 2025 which has been

accounted for as a £60m contribution made by the Company in Provident Financial Holdings Limited;

(ii) £10m due the transfer of the investment in Provfin Limited from another Group company as part

of a Group reorganisation, in advance of those companies being placed into members’ voluntary

liquidation; and (ii) £0.3m additions (2024: disposal £1.1m) in relation to the movement in share

options/awards provided to the subsidiary employees. Under IFRS 2, the fair value of the share

options/awards issued is required to be treated as a capital contribution and an investment in the

relevant subsidiary, net of any share options/awards that have vested.

The movements in 2024 reflect steps taken to make two non-trading companies solvent in advance

of them entering members’ voluntary liquidation. This included the subscription of £3.2m of shares

in Yes Car Credit Limited and £75.2m of shares in Provident Yes Car Credit Limited, both of which

were subsequently impaired based on the value of the underlying assets of the companies.

Additions in 2024 also included steps taken to increase the investment value of Provident Financial

Holdings Limited by £7.5m as part of the transfer of trade and assets of its subsidiary, PFG Corporate

Services Limited, to Vanquis Bank Limited .

173 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

The net retirement benefit asset recognised in the balance sheet of the Group and the Company is

as follows:

			Group and Company
	2025		2024
	£m	%	£m	%
Equities	45.0	10	63.7	14
Corporate bonds	152.1	34	46.6	10
Government bonds	241.8	54	316.8	70
Cash and money market funds	7.1	2	26.6	6
Total fair value of scheme assets	446.0	100	453.7	100
Present value of funded defined benefit obligation	(439.6)		(425.9)
Net retirement benefit asset recognised in the balance sheet	6.4		27.8

The Company and the pension trustees have agreed a low-risk investment strategy that involves

hedging the inflation and interest rate risks associated with the liabilities of the pension scheme,

whilst also holding a modest allocation to growth funds, such as equities. This position is reviewed

periodically by the trustees, which consult the Company as part of this process.

The valuation of the retirement benefit asset has decreased from £27.8m at 31 December 2024 to

£6.4m at 31 December 2025. A high-level reconciliation of the movement is as follows:

		Group and Company
	2025	2024
	£m	£m
Pension asset as at 1 January	27.8	38.2
Cash contributions made by the Group	0.8	0.8
Return on assets being held to meet pension obligations in excess of discount rate	(5.5)	(54.6)
Change in demographic assumptions	(9.2)	(0.9)
(Decrease)/increase in discount rate used to discount future liabilities	(1.7)	48.2
Change in inflation rate used to forecast pensions	5.8	(4.5)
Actuarial/membership experience	(11.5)	0.2
Other	(0.1)	0.4
Pension asset as at 31 December	6.4	27.8

22 Retirement benefit asset

(a) Pension schemes – defined benefit

The retirement benefit asset reflects the difference between the present value of the Group’s

obligation to current and past employees to provide a defined benefit pension and the fair value of

assets held to meet that obligation. As at 31 December 2025, the fair value of the assets exceeded

the obligation and hence a net pension asset has been recorded.

The Group operates a defined benefit scheme, the Provident Financial Staff Pension Scheme.

The scheme is of the funded, defined benefit type. It is now also closed to future accrual.

The scheme provides pension benefits that were accrued on a final salary and, more recently, on a

cash balance basis. It was fully closed to future accrual in 2021 and benefits are no longer linked to

final salary, although accrued benefits are subject to statutory inflationary increases.

The scheme is a UK registered pension scheme under UK legislation. The scheme is governed by a

Trust Deed and Rules, with trustees responsible for the operation and governance of the scheme.

The trustees work closely with the Group on funding and investment strategy decisions. The most

recent actuarial valuation of the scheme was carried out as at 1 June 2024 by a qualified independent

actuary. The valuation used for the purposes of IAS 19 Employee Benefits has been based on the

results of the 2024 valuation to take account of the requirements of IAS 19 in order to assess the

liabilities of the scheme at the balance sheet date. Scheme assets are stated at fair value as at the

balance sheet date.

The Group is entitled to a refund of any surplus, subject to tax, if the scheme winds up after all

benefits have been paid. As a result, the Group recognises surplus assets under IAS 19.

The Group is exposed to a number of risks, the most significant of which are as follows:

5 Investment risk – the liabilities for IAS 19 purposes are calculated using a discount rate set

with reference to corporate bond yields. If the assets underperform this yield a deficit will arise.

The scheme has a long-term objective to reduce the level of investment risk by investing in assets

that better match liabilities.

5 Change in bond yields – a decrease in corporate bond yields will increase the liabilities, although

this will be partly offset by an increase in matching assets.

5 Inflation risk – some of the liabilities are linked to inflation. If inflation increases then liabilities

will increase, although this will be partly offset by an increase in assets. As part of a long-term

de-risking strategy, the scheme has increased its portfolio in inflation matched assets.

5 Life expectancies – the scheme’s final salary benefits provide pensions for the rest of members’

lives (and for their spouses’ lives). If members live longer than assumed, then the liabilities in

respect of final salary benefits increase.

174 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

The principal actuarial assumptions used at the balance sheet date were as follows:

		Group and Company
	2025	2024
	%	%
Price inflation – RPI	2.85	3.20
Price inflation – CPI	2.30	2.75
Rate of increase to pensions in payment	2.80	3.00
Inflationary increases to pensions in deferment	2.20	2.75
Discount rate	5.50	5.55

The pension increase assumption shown above applies to pensions increasing in payment each year

in line with RPI up to 5%. Pensions accrued prior to 2000 are substantially subject to fixed 5%

increases each year. In deferment, increases prior to retirement are linked to CPI.

The mortality assumptions are based on the Self-Administered Pension Scheme (SAPS) series 4 tables

(2024: SAPS series 3 tables):

5 female non-pensioners: 110% of the ‘Middle’ table (2024: 105% of the ‘Middle’ table);

5 male non-pensioners: 113% of the ‘Middle’ table (2024: 105% of the ‘Middle’ table);

5 female pensioners: 110% of the ‘Middle’ table (2024: 102% of the ‘Middle’ table); and

5 male pensioners: 99% of the ‘All’ table (2024: 99% of the ‘All’ table).

The above multipliers and table types were chosen following a study of the scheme’s membership.

Where the multiplier is greater than 100%, this reflects a shorter life expectancy within the scheme

compared to average pension schemes, with the opposite being true where the multiplier is less than

100%. Also, the use of the ‘Middle’ table typically leads to slightly lower life expectancy compared to

using the corresponding ‘All’ table.

Future improvements in mortality are based on the Continuous Mortality Investigation (CMI) 2024

model with a long-term trend of 1.00% p.a., the core parameters for the initial addition and smoothing

parameter. All other available parameters for the mortality improvements model were adopted at

the default (core) level.

Under these mortality assumptions, the life expectancies of members are as follows:

	Male		Female
	2025	2024	2025	2024
Group and Company	years	years	years	years
Current pensioner aged 65	21.5	21.2	23.0	23.0
Current member aged 45 from age 65	21.5	21.2	24.2	24.0

22 Retirement benefit asset continued

(a) Pension schemes – defined benefit continued

The amounts recognised in the income statement were as follows:

		Group and Company
	2025	2024
	£m	£m
Administration costs and taxes	(1.6)	(1.3)
Interest on scheme liabilities	(23.0)	(21.7)
Interest on scheme assets	24.5	23.4
(Charge)/credit recognised in the income statement	(0.1)	0.4

The (charge)/credit recognised in the income statement of the Group and the Company has been

included within operating costs.

Movements in the fair value of scheme assets were as follows:

		Group and Company
	2025	2024
	£m	£m
Fair value of scheme assets at 1 January	453.7	512.9
Interest on scheme assets	24.5	23.4
Actuarial movement on scheme assets	(5.5)	(54.6)
Contributions by the Group/Company	0.8	0.8
Net benefits paid out	(27.5)	(28.8)
Fair value of scheme assets at 31 December	446.0	453.7

The Group contributions over 2026 are expected to be £1.3m.

Movements in the present value of the defined benefit obligation were as follows:

		Group and Company
	2025	2024
	£m	£m
Present value of the defined benefit obligation at 1 January	(425.9)	(474.7)
Administration costs and taxes	(1.6)	(1.3)
Interest on scheme liabilities	(23.0)	(21.7)
Actuarial movement – experience	(11.5)	0.2
Actuarial movement – demographic assumptions	(9.2)	(0.9)
Actuarial movement – financial assumptions	4.1	43.7
Net benefits paid out	27.5	28.8
Present value of the defined benefit obligation at 31 December	(439.6)	(425.9)

The liabilities of the scheme are based on the current value of expected benefit payments over the

next 80 years. The weighted average duration of the scheme liabilities is approximately 11 years

(2024: 12 years).

175 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

The experience adjustments for the net retirement benefit asset is as follows:

		Group and Company
	2025	2024
	£m	£m
Fair value of scheme assets	446.0	453.7
Present value of funded defined benefit obligation	(439.6)	(425.9)
Retirement benefit asset recognised in the balance sheet	6.4	27.8
Experience (losses)/gains on scheme assets:
– amount (£m)	(5.5)	(54.6)
– percentage of scheme assets (%)	(1.2)	(12.0)
Experience losses/(gains) on scheme liabilities:
– amount (£m)	11.5	(0.2)
– percentage of scheme liabilities (%)	2.6	—

In June 2023, the UK High Court issued a ruling in the case of Virgin Media Limited v NTL Pension

Trustees II Limited and others relating to the validity of certain historical pension changes. This was

subject to appeal in 2024 and the original ruling was upheld. The Group has determined there to be

no impact on the pension scheme as a result of the ruling.

(b) Pension schemes – defined contribution

The Group operates a Group Personal Pension Plan into which Group companies contribute a

proportion of pensionable earnings of the member (typically ranging between 5.1% and 10.6%)

dependent on the proportion of pensionable earnings contributed by the member through a salary

sacrifice arrangement (typically ranging between 3% and 8%). The assets of the scheme are held

separately from those of the Group and Company.

The Group also operates a separate pension scheme for auto-enrolment into which the Company

and subsidiaries contribute a proportion of qualifying earnings of the member of 4%. The assets of

the scheme are held separately from those of the Group or the Company. The pension charge in the

consolidated income statement represents contributions paid by the Group in respect of these plans

and amounted to £5.7m for the year ended 31 December 2025 (2024: £6.9m). Contributions made by

the Company amounted to £0.9m (2024: £2.0m). £0.8m of contributions were payable to the fund at

the year end (2024: £nil).

The Group contributed £nil in 2025 into individual personal pension plans in the year (2024: £nil).

22 Retirement benefit asset continued

(a) Pension schemes – defined benefit continued

The table below shows the sensitivity on the defined benefit obligation (not including any impact on

assets) of changes in the key assumptions. Depending on the scenario, there would also be

compensating asset movements.

		Group and Company
	2025	2024
	£m	£m
Discount rate decreased by 0.5%	24.3	24.4
Inflation increased by 0.1%	2.1	2.2
Life expectancy increased by one year	18.4	16.4

The actual return on scheme assets compared to the expected return is as follows:

		Group and Company
	2025	2024
	£m	£m
Interest on scheme assets	24.5	23.4
Actuarial movement on scheme assets	(5.5)	(54.6)
Actual return on scheme assets	19.0	(31.2)

Actuarial gains and losses are recognised through other comprehensive income in the period in which

they occur.

An analysis of the amounts recognised in the statement of other comprehensive income is as follows:

		Group and Company
	2025	2024
	£m	£m
Actuarial movement on scheme assets	(5.5)	(54.6)
Actuarial movement on scheme liabilities	(16.6)	43.0
Total movement recognised in other comprehensive income in the year	(22.1)	(11.6)
Cumulative movement recognised in other comprehensive income	(182.0)	(159.9)

176 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

Group Company

		2025		2024		2025		2024
	Assets	Liabilities	Assets	Liabilities	Assets	Liabilities	Assets	Liabilities
Fair value of derivatives	£m	£m	£m	£m	£m	£m	£m	£m
Derivatives in hedge
accounting relationships
Fair value portfolio hedges
Interest rate swaps
Fixed to floating	—	(0.5)	—	—	—	—	—	—
Floating to fixed	0.2	—	—	—	—	—	—	—
Total derivatives in portfolio fair value hedging
relationships	0.2	(0.5)	—	—	—	—	—	—
Individual fair value hedges
Fixed to floating	0.1	(3.0)	—	—	—	(0.4)	—	—
Floating to fixed	1.5	—	—	(1.3)	1.5	—	—	(1.3)
Total derivatives in hedge
accounting relationships	1.8	(3.5)	—	(1.3)	1.5	(0.4)	—	(1.3)
Other derivatives
Interest rate swaps	2.1	(2.6)	—	(0.5)	2.2	—	0.6	(0.4)
Total recognised
derivative assets/
(liabilities)	3.9	(6.1)	—	(1.8)	3.7	(0.4)	0.6	(1.7)

23 Derivative financial instruments

The Group enters into derivative financial instruments, primarily interest rate swaps, exclusively for

risk management purposes. These instruments are used to mitigate specifically identified interest rate

risks arising from recognised assets and liabilities. The Group does not engage in derivative trading.

The Group is counterparty to 24 (2024: 10) derivative financial instruments.

All derivatives are recognised on the balance sheet at fair value using valuation techniques based

on observable market data. The Group applies standard discounted cash flow methodologies, using

externally sourced SONIA yield curves and OIS discount factors. Where the criteria under IAS 39

are met, hedge accounting is applied. Where derivatives form part of an economic hedging strategy

but do not qualify for hedge accounting, they are measured at fair value through profit or loss.

The Group designates:

5 Portfolio fair value hedges of interest rate risk

5 Fair value hedges of specific financial assets or liabilities

In 2025, the Group entered into three new categories of interest rate swaps, all of which are

designated in hedge accounting relationships:

1) To diversify excess liquidity investments, the Group began purchasing UK Government Bonds (Gilts).

Interest rate risk arising from these holdings was managed through par-to-par interest rate swaps

with terms aligned to the underlying gilts. As at 31 December 2025, 12 such swaps were in place.

2) Following growth in the Second Charge Mortgage portfolio, the Group entered into six interest

rate swaps to manage the associated interest rate risk.

3) The Group also transacted two external deposit swaps to manage interest rate risk arising

from retail customer deposit balances.

As result of AT1 issuance in October 2025, £58.5m of Tier 2 capital was repaid and the notional of the

Tier 2 swap was reduced by the same amount.

During the year, all internal retail deposit swaps were fully settled. All externally facing derivatives

held by Vanquis Banking Group plc were novated to Vanquis Bank Limited in December 2025 at the

prevailing market value on the date of transfer, resulting in no impact to the income statement.

The analysis below distinguishes between derivatives accounted for as fair value hedges and those

measured at fair value through profit or loss .

177 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

		Group					Company
		2025		2024	2025			2024
	Assets	Liabilities	Assets	Liabilities	Assets	Liabilities	Assets	Liabilities
Hedged items	£m	£m	£m	£m	£m	£m	£m	£m
Monetary amount of risk relating to Fair value portfolio hedges
Second Charge Mortgages	59.0	—	—	—	—	—	—	—
Retail deposits	—	(150.0)	—	—	—	—	—	—
Total hedged items in portfolio hedges	59.0	(150.0)	—	—	—	—	—	—
Individual fair value hedges
Gilts	250.0	—	—	—	—	—	—	—
Tier 2	—	(141.5)	—	(200.0)	—	(141.5)	—	(200.0)
Total derivatives in hedge
accounting relationships	250.0	(141.5)	—	(200.0)	—	(141.5)	—	(200.0)

Macro fair value hedges

The Group applies macro fair value hedge accounting to portfolios of fixed-rate Second Charge

Mortgages and fixed-rate retail deposits.

The hedged items represent designated portions of these portfolios allocated to defined repricing

time buckets. The hedged risk is exposure to changes in fair value attributable to movements in the

designated benchmark interest rate (SONIA).

Interest rate swaps are used as hedging instruments.

The hedge ratio is determined by reference to the interest rate risk position within each repricing time

bucket. The amount designated as hedged reflects the proportion of the interest rate risk exposure

that the Group chooses to hedge in line with its asset and liability management strategy.

An economic relationship exists because changes in the fair value of the designated portion of the

portfolios attributable to movements in the benchmark rate are expected to be offset by changes in

the fair value of the swaps.

Sources of hedge ineffectiveness may include:

5 behavioural assumptions, including mortgage prepayment risk and early withdrawal of deposits;

5 differences between expected and actual repricing profiles;

5 basis differences between contractual product rates and the designated benchmark rate;

5 yield curve shape changes;

5 differences in yield curve construction or interpolation methodologies used in the valuation of

hedged items and hedging instruments.

23 Derivative financial instrument continued

		Group					Company
		2025		2024		2025		2024
	Assets	Liabilities	Assets	Liabilities	Assets	Liabilities	Assets	Liabilities
Notional value of derivatives	£m	£m	£m	£m	£m	£m	£m	£m
Derivatives in hedge
accounting relationships
Fair value portfolio hedges
Interest rate swaps
Fixed to floating	—	59.0	—	—	—	—	—	—
Floating to fixed	150.0	—	—	—	—	—	—	—
Total derivatives in portfolio fair value
hedging relationships	150.0	59.0	—	—	—	—	—	—
Individual fair value hedges
Fixed to floating	35.0	273.5	—	—	—	58.5	—	—
Floating to fixed	200.0	—	—	200.0	200.0	—	—	200.0
Total derivatives in hedge
accounting relationships	385.0	332.5	—	200.0	200.0	58.5	—	200.0
Other derivatives
Interest rate swaps	289.2	297.7	—	296.4	400.0	58.5	70.0	356.4
Total derivative notional	674.2	630.2	—	496.4	600.0	117.0	70.0	556.4

The associated fair value adjustment for hedged risk and the balance sheet balance this is included

against is outlined below:

	Group		Company
	2025	2024	2025	2024
Fair value adjustment for hedged risk	£m	£m	£m	£m
On amounts receivable from customers (note 14)	0.2	(0.9)	—	—
On bank and other borrowings (note 28)	0.2	2.5	0.2	2.5
On investment securities (note 13)	1.3	—	—	—
On retail deposits (note 28)	(0.2)	—	—	—

The tables below set out the carrying amounts of hedged items in fair value hedge relationships at

year end. The amounts represent the monetary exposure to interest rate risk designated as the

hedged item for each relationship.

178 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

23 Derivative financial instrument continued

Micro fair value hedges

The Group designates individual fixed-rate instruments in micro fair value hedge relationships. These

include Tier 2 borrowings and UK Government bonds (Gilts).

The hedged risk is exposure to changes in fair value attributable to movements in the designated

benchmark interest rate (SONIA).

Interest rate swaps are used as hedging instruments.

The hedge ratio is determined by aligning the nominal amount of the swap with the principal amount

of the hedged instrument. The Group generally applies a 1:1 hedge ratio, consistent with its risk

management strategy.

An economic relationship exists because changes in the fair value of the hedged instrument

attributable to the benchmark rate are expected to be offset by changes in the fair value of the

swap. This relationship is assessed using discounted cash flow modelling based on observable

market yield curves.

Sources of hedge ineffectiveness may include:

5 differences between the contractual coupon and the designated benchmark rate;

5 timing differences in cash flows or reset dates;

5 differences in yield curve construction or interpolation methodologies.

The total Group hedge ineffectiveness in 2025 was £nil (2024: £nil).

Had hedge accounting not been applied, the Group would have recognised a total charge of £0.5m

(2024: £1.3m) in the income statement reflecting the movement in the derivative.

Swaps not designated in hedge accounting relationships

The Group also holds certain interest rate swaps that are not currently designated in hedge

accounting relationships.

The securitisation Balance Guarantee Swap (front BGS) was originally entered into to hedge interest

rate risk within the securitisation special purpose vehicle (SPV). It resized in line with changes in the

size and expected maturity profile of the underlying loan portfolio.

The front BGS was previously designated in a portfolio fair value hedge relationship under IAS 39. Hedge

accounting was discontinued in September 2022. Since discontinuation, the swap has not been designated

in a hedge relationship and changes in fair value are recognised directly in the income statement.

The cumulative fair value hedge adjustment recognised up to the date of discontinuation is being

amortised over the remaining life of the underlying receivables. The unamortised balance of £0.2m

(2024: £0.9m) is included within amounts receivable from customers (note 14).

The Group entered into a corresponding Balance Guarantee Swap (back BGS) specifically to offset

the front BGS on consolidation. The front BGS addressed a risk present in the SPV financial

statements that does not exist at consolidated Group level. Accordingly, no hedge accounting is

applied to either instrument in the consolidated financial statements .

24 Deferred tax

Deferred tax is a future tax liability or asset resulting from temporary differences between the

accounting value of assets and liabilities and their value for tax purposes or from tax losses carried

forward at the reporting date. No expiry date applies to these losses.

Deferred tax arises primarily in respect of: (a) property, plant and equipment that is depreciated on a

different basis for tax purposes; (b) the Group’s retirement benefit asset; (c) Vanquis Bank’s investment

in the preference shares in Visa Inc, which are recognised at fair value for accounting purposes but

which are taxed only on disposal; (d) the opening balance sheet adjustments to restate the IAS 39

balance sheet to an IFRS 9 basis for which tax deductions are typically available over 10 years; and

(e) other temporary differences including: (i) deductions for employee share awards that are recognised

differently for tax purposes; (ii) certain cost provisions for which tax deductions are only available

when the costs are paid; (iii) the opening balance sheet adjustment in respect of the change of

accounting treatment of directly attributable acquisition costs in Vanquis Bank, which is taxable over

10 years; (iv) the opening balance sheet adjustment in respect of the adoption of IFRS 16 (Leases)

which is deductible over the average period of the relevant leases; (v) the balance guaranteed swap

entered into as part of the Vehicle Finance securitisation; and (vi) certain intangible fixed asset

additions where tax deductions have been accelerated.

179 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

24 Deferred tax continued

In addition, a deferred tax liability is recognised in respect of the acquisition of Snoop relating to the

intangible asset in respect of software development costs, which are amortised in future periods but

for which tax deductions are not available. The deferred tax liability recognised at 31 December 2023

relating primarily to the broker relationships intangible asset acquired as part of the Vehicle Finance

purchase unwound during 2024.

Deferred tax balances have been measured at the mainstream corporation tax rate of 25% except to

the extent the temporary differences of the Cards business on which deferred tax has been calculated

are expected to reverse when profits from Cards are forecast to be above the bank corporation tax

surcharge threshold of £100m, in which case deferred tax will be measured at the combined

mainstream corporation tax rate (25%) and bank corporation tax surcharge rate (3%) of 28%.

The movement in the deferred tax balance during the year can be analysed as follows:

Group

Company

Asset/(liability)

2025

£m

2024

£m

2025

£m

2024

£m

At 1 January 25.0 8.4 (5.6) (7.8)

(Charge)/credit to the income statement (0.5) 13.7 (0.6) (0.7)

Transfer to other Group companies — — (0.3) —

Credit to other comprehensive income 5.5 2.9 5.5 2.9

At 31 December 30.0 25.0 (1.0) (5.6)

				2025
	Accelerated				Retirement	Other
	capital	Visa	Tax		benefit	temporary
	allowances	shares	losses	IFRS 9	obligations	differences	Total
Group – asset/(liability)	£m	£m	£m	£m	£m	£m	£m
At 1 January	2.7	(0.5)	19.5	14.6	(7.0)	(4.3)	25.0
Credit/(charge) to the income statement	0.5	(0.1)	1.6	(4.9)	(0.1)	2.5	(0.5)
Credit to other comprehensive income	—	—	—	—	5.5	—	5.5
At 31 December	3.2	(0.6)	21.1	9.7	(1.6)	(1.8)	30.0

				2024
	Accelerated				Retirement	Other
	capital	Visa	Tax		benefit	temporary
	allowances	shares	losses	IFRS 9	obligations	differences	Total
Group – asset/(liability)	£m	£m	£m	£m	£m	£m	£m
At 1 January	1.4	(1.4)	1.9	19.6	(9.6)	(3.5)	8.4
Credit/(charge) to the income statement	1.3	0.9	17.6	(5.0)	(0.3)	(0.8)	13.7
Credit to other comprehensive income	—	—	—	—	2.9	—	2.9
At 31 December	2.7	(0.5)	19.5	14.6	(7.0)	(4.3)	25.0

There was no impact on the deferred tax asset in 2025 or 2024 due to changes in UK tax rates.

Deferred tax assets on losses and other temporary differences

Deferred tax assets comprise deferred tax assets on carried forward losses of £21.1m (2024: £19.5m)

and deferred tax assets on temporary differences of £8.9m (2024: £5.5m). These have been recognised

on the basis that the Group’s detailed forecasts for the three years to 31 December 2028 and the less

detailed forecasts for 2029 and 2030 in the corporate plan approved by the Board in January 2026

show that there are expected to be sufficient taxable profits available in future periods against which

the carry forward of losses can be utilised after taking into account the reversal of the temporary

differences and the Group loss restriction rules, which restrict the extent to which carried forward

losses can be offset against Group taxable profits in any particular accounting period. No expiry

date applies to these losses.

At 31 December 2025, there were £31.7m (2024: £31.7m) of pre-acquisition carried forward UK tax

losses in Snoop for which a deferred tax asset has not been recognised as there are restrictions that

apply to the utilisation of pre-acquisition tax losses and therefore the offset against future profits is

not sufficiently certain at this stage.

No deferred tax asset has been recognised in respect of the Group’s capital losses carried forward

of £378.0m (2024: £123.0m) as it is not probable that future chargeable gains will be realised against

which these losses can be utilised. No expiry date applies to these losses.

180 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

24 Deferred tax continued

Deferred tax assets on losses and other temporary differences continued

An analysis of the deferred tax liability for the Company is set out below:

		2025
	Accelerated	Other	Retirement
	capital	temporary	benefit
	allowances	differences	obligations	Total
Company – asset/(liability)	£m	£m	£m	£m
At 1 January	0.4	1.0	(7.0)	(5.6)
(Charge)/credit to the income statement	—	(0.5)	(0.1)	(0.6)
Transfer to other Group companies	(0.4)	0.1	—	(0.3)
Credit to other comprehensive income	—	—	5.5	5.5
At 31 December	—	0.6	(1.6)	(1.0)
		2024
	Accelerated	Other	Retirement
	capital	temporary	benefit
	allowances	differences	obligations	Total
Company – asset/(liability)	£m	£m	£m	£m
At 1 January	0.3	1.5	(9.6)	(7.8)
(Charge)/credit to the income statement	0.1	(0.5)	(0.3)	(0.7)
Transfer to other Group companies	—	—	—	—
Credit to other comprehensive income	—	—	2.9	2.9
At 31 December	0.4	1.0	(7.0)	(5.6)

There was no impact on the deferred tax liability in 2025 or 2024 due to the changes in UK tax rates.

25 Trade and other payables

	Group		Company
	2025	2024	2025	2024
	£m	£m	£m	£m
Trade payables	17.3	6.1	1.5	0.5
Amounts owed to Group undertakings	—	—	9.7	14.5
Other payables including taxation and social security	6.7	5.1	0.2	2.9
Accruals	27.8	34.9	1.8	3.0
Total trade and other payables	51.8	46.1	13.2	20.9

The amounts owed to Group undertakings are unsecured and accrue interest at rates linked to SONIA.

Included within accruals are £1.8m (2024: £8.1m) of Finance Ombudsman Service (FOS) case fees for

amounts payable on cases.

26 Provisions

Group – 2025

Provisions

Vehicle

Finance

redress

£m

Customer

compliance

£m

			Dilapidations	Redundancy	Others	Total
			£m	£m	£m	£m
At 1 January	—	7.4	6.4	1.3	0.4	15.5
Created in the year	3.0	12.7	0.2	—	—	15.9
Reclassified in the year	—	0.4	—	—	(0.4)	—
Utilised in the year	—	(15.8)	(1.0)	(1.0)	—	(17.8)
Released in the year	—	(2.9)	(2.6)	(0.2)	—	(5.7)
At 31 December	3.0	1.8	3.0	0.1	—	7.9

				Group – 2024
	Customer				Legal
	compliance	Dilapidations	Redundancy	Scheme	settlement	Others	Total
Provisions	£m	£m	£m	£m	£m	£m	£m
At 1 January	3.5	0.2	—	1.0	—	1.1	5.8
Created in the year	16.0	6.2	6.2	—	1.5	0.1	30.0
Reclassified in the year	—	—	—	—	(1.4)	—	(1.4)
Utilised in the year	(12.1)	—	(4.9)	—	—	(0.6)	(17.6)
Released in the year	—	—	—	(1.0)	(0.1)	(0.2)	(1.3)
At 31 December	7.4	6.4	1.3	—	—	0.4	15.5

				Company
		2025			2024
	Redundancy	Dilapidations	Total	Redundancy	Dilapidations	Total
Provisions	£m	£m	£m	£m	£m	£m
At 1 January	0.3	5.3	5.6	—	—	—
Created in the year	—	0.2	0.2	2.5	5.3	7.8
Transferred in the year	(0.2)	(0.7)	(0.9)
Utilised in the year	—	(1.1)	(1.1)	(2.2)	—	(2.2)
Released in the year	(0.1)	(2.6)	(2.7)	—	—	—
At 31 December	—	1.1	1.1	0.3	5.3	5.6

181 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

26 Provisions continued

Vehicle Finance redress: £3.0m (2024: £nil)

The Group Vehicle Finance redress provision relates to the FCA consultation on a motor finance

compensation scheme announced in October 2025. This provision is the result of several probability

weighted scenarios and includes the operational cost of outreach, implementation and execution of

the scheme. Assuming the proposed base case redress calculation within the consultation, including

an estimate of 85% of eligible consumers taking part in the scheme and simple interest applied at 1%

above the base rate, the estimated costs would be £7.0m. Refer to material accounting policy

information on page 150 for further details.

Customer compliance: £1.8m (2024: £7.4m)

The customer remediation provision reflects expected costs associated with general customer

compliance matters, encompassing both customer redress obligations and related FOS fees. The

provision increased temporarily during 2024 due to a rise in unmerited claims submitted by CMCs

however, the implementation of the revised FOS charging structure in 2025 has resulted in a material

reduction in such claims and associated costs.

Dilapidations: £3.0m (2024: £6.4m); Company: £1.1m (2024: £5.3m)

Dilapidations provisions being held for all properties. The £2.6m (2024: £nil) release relates to the

cessation of the No1 Godwin Street lease where lower expected costs were incurred when the

property was vacated.

Redundancy: £0.1m (2024: £1.3m); Company: £nil (2024: £0.3m)

Costs expected to be paid out as part of redundancy programmes during the year.

Other: £nil (2024: £0.4m)

This predominantly relates to smaller provisions held.

Legal settlement: £nil (2024: £nil)

Amounts were recognised in 2024 for an expected settlement with a third party. The amount was

agreed and the provision transferred to accruals in advance of being settled in early 2025.

The Scheme of Arrangement (the Scheme): Group: £nil (2024: £nil); Company: £nil (2024: £nil)

Customer settlements in relation to the Scheme of Arrangement commenced in 2022. All remaining

provision was released in 2024 and the Scheme closed.

27 Lease liabilities

A maturity analysis of the lease liabilities is shown below:

	Group		Company
	2025	2024	2025	2024
	£m	£m	£m	£m
Due within one year	5.0	12.5	—	4.7
Due between one and five years	15.0	13.7	—	3.2
Due in more than five years	3.2	9.0	—	4.8
Total	23.2	35.2	—	12.7
Unearned finance cost	(2.0)	(2.7)	—	(1.4)
Total lease liabilities	21.2	32.5	—	11.3

Right of use assets are disclosed in note 18.

Lease payments for the Group of £10.7m (2024: £12.7m) include: (i) capital repayments of £10.0m

(2024: £9.7m); (ii) interest of £0.7m (2024: £3.0m); and (iii) short-term lease cash outflows of £nil

(2024: £nil). At 31 December 2025, the Group is also committed to £nil (2024: £nil) for short-term leases.

Total cash outflows for the Company amounted to £3.5m (2024: £5.2m) and include: (i) capital

repayments of £3.3m (2024: £3.0m); and (ii) interest of £0.2m (2024: £2.2m).

182 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

A reconciliation of the movement in retail deposits is set out below:

	2025	2024
Group	£m	£m
At 1 January	2,428.2	1,950.5
Funds received	1,627.2	1,107.5
Capitalised and accrued interest	64.8	51.9
Withdrawals	(1,100.5)	(681.7)
At 31 December	3,019.7	2,428.2

				The maturity of retail deposits and borrowings, together with the maturity of facilities, is as follows:
		2025		2024
	Borrowing		Borrowing
	facilities		facilities
	available	Borrowings	available	Borrowings
Group	£m	£m	£m	£m
Repayable:
On demand (uncommitted)	531.4	531.4	377.1	377.1
In less than one year	1,860.0	1,860.0	1,462.9	1,462.9
Between one and two years	672.4	672.4	621.4	621.4
Between two and five years	123.2	123.2	143.6	143.6
In more than five years	141.5	141.5	200.0	200.0
Accrued interest	—	39.5	—	37.8
Arrangement fees	—	(0.6)	—	(2.1)

Total Group 3,328.5 3,367.4 2,805.0 2,840.7

Retail deposits and borrowings are stated after deducting £0.6m (2024: £2.1m) of unamortised

arrangement fees and the addition of accrued interest of £39.5m (2024: £37.8m).

		2025	2024
	Borrowing		Borrowing
	facilities		facilities
	available	Borrowings	available	Borrowings
Company	£m	£m	£m	£m
Repayable:
On demand (uncommitted)	—	—	—	—
In less than one year	—	—	—	—
Between one and two years	—	—	—	—
Between two and five years	—	—	—	—
In more than five years	141.5	141.5	200.0	200.0
Accrued interest	—	5.9	—	8.2
Arrangement fees	—	(0.6)	—	(1.0)
Total Company	141.5	146.8	200.0	207.2

28 Borrowings

Group

Company

2025

£m

2024

£m

2025

£m

2024

£m

Retail deposits 3,019.7 2,428.2 — —

Fair value adjustment for hedged risk (note 23) 0.2 — — —

Total retail deposits 3,019.9 2,428.2 — —

Bank and other borrowings 347.7 412.5 146.8 207.2

Fair value adjustment for hedged risk (note 23) (0.2) (2.5) (0.2) (2.5)

Total 347.5 410.0 146.6 204.7

Total reported retail deposits and borrowings 3,367.4 2,838.2 146.6 204.7

(a) Facilities and borrowings

A breakdown of retail deposits and borrowings is shown below:

Group

2025

£m

2024

£m

Retail deposits: 2,985.9 2,398.9

– accrued interest 33.6 29.3

Total retail deposits (note (b)) 3,019.7 2,428.2

Bank and other borrowings:

– Vehicle Finance securitisation (note (e)) 200.0 200.0

– Tier 2 (note (f)) 141.5 200.0

– central bank facilities (note (g)) — 5.0

– bank overdrafts 0.9 1.1

– accrued interest 5.9 8.5

– arrangement fees (0.6) (2.1)

Total bank and other borrowings 347.7 412.5

Total retail deposits and borrowings 3,367.4 2,840.7

(b) Retail deposits

Vanquis Bank Limited is a PRA-regulated bank and is majority funded through retail deposits. As at

31 December 2025, £3,019.7m (2024: £2,428.2m) of term, ISA, notice and Easy Access account deposits

had been taken. The deposits in issue at 31 December 2025 have been issued at rates of between

0.4% and 6.2% .

183 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

The Group makes drawings under the Indexed Long-Term Repo (ILTR) programme from time to time

for liquidity purposes. Drawings under the ILTR have a maturity of six months on drawdown and a

rate of interest set in an auction process. At 31 December 2025 the Group had no (2024: £5.0m)

ILTR drawings.

(h) Undrawn committed borrowing facilities

The Group and Company had no undrawn committed borrowing facilities at the end of 2025 or 2024.

(i) Weighted average interest rates and periods to maturity

The weighted average interest rate and the weighted average period to maturity of the Group and

Company’s fixed-rate retail deposits and borrowings are as follows:

		Group					Company
	2025		2024		2025		2024
	Weighted	Weighted	Weighted	Weighted	Weighted	Weighted	Weighted	Weighted
	average	average	average	average	average	average	average	average
	interest	period to	interest	period to	interest	period to	interest	period to
	rate	maturity	rate	maturity	rate	maturity	rate	maturity
	%	years	%	years	%	years	%	years
Sterling	4.8	1.4	5.0	1.2	8.9	6.0	8.9	7.0

(j) Fair values

The fair values of the Group and Company’s retail deposits and borrowings are compared to their

book values as follows:

		Group 2025		Company 2025
	Book value	Fair value	Book value	Fair value
	£m	£m	£m	£m
Retail deposits	3,019.9	2,986.3	—	—
Bank loans and overdrafts	0.9	0.9	—	—
Securitisation	200.0	202.7	—	—
Tier 2	146.6	150.0	146.6	150.0
Central bank facilities	—	—	—	—
Total	3,367.4	3,339.9	146.6	150.0

		Group 2024		Company 2024
	Book value	Fair value	Book value	Fair value
	£m	£m	£m	£m
Retail deposits	2,428.2	2,400.4	—	—
Bank loans and overdrafts	1.1	1.1	—	—
Securitisation	200.0	199.1	—	—
Tier 2	204.7	168.8	204.7	168.8
Central bank facilities	4.2	4.2	—	—
Total	2,838.2	2,773.6	204.7	168.8

All the above numbers include interest, fees and fair value adjustment for hedged risk .

28 Borrowings continued

As at 31 December 2025, the weighted average period to maturity of the Group’s committed facilities,

including retail deposits, was 0.9 years (2024: 1.3 years) and for the Company’s committed facilities

was 6.0 years (2024: 7.0 years). Excluding retail deposits, the weighted average period to maturity of

the Group’s committed facilities was 3.4 years (2024: 4.7 years).

(d) Interest rate and currency profile

The interest rate exposure on retail deposits and borrowings is as follows:

	Group		Company
	2025	2024	2025	2024
	£m	£m	£m	£m
Fixed	1,669.6	1,644.7	146.8	207.2
Floating	1,697.8	1,196.0	—	—
Total	3,367.4	2,840.7	146.8	207.2

All retail deposits and borrowings are in sterling; therefore, there is no foreign exchange exposure in

the current or prior year.

(e) Vehicle Finance securitisation

The Group renegotiated the bilateral securitisation facility in December 2024; the facility has a

12-month amortisation period (if not refinanced) commencing in June 2026 and an ultimate maturity

date in June 2027.

(f) Tier 2

On 7 October 2021, the Group issued Tier 2 subordinated bonds for a total amount of £200m. The

bonds have a 10.25-year maturity that is callable at the Group’s discretion between five and 5.25

years, and that pays a coupon of 8.875%. The issuance was written from the Group’s £2bn EMTN

programme. On 2 October 2025 following a tender offer, £58.5m of the Tier 2 subordinated bonds

were purchased by the Company for cash and subsequently cancelled leaving a total remaining in

aggregate principal amount of £141.5m outstanding.

(g) Central bank facilities

In January 2021, Vanquis Bank Limited, via a special purpose entity, issued a series of asset backed

floating rate notes as part of the securitisation of Credit Card receivables. The senior notes issued in

the transaction have been rated AAAsf/Aaa(sf)/AAAsf by Fitch Ratings, Kroll Bond Rating Agency

and Standard & Poor’s, respectively, and the bonds are listed on the London Stock Exchange.

During the year, the Group has utilised facilities provided by the Bank of England through its Sterling

Monetary Framework. These facilities enable either funding on or off-balance sheet liquidity to be

provided to Vanquis Bank Limited on the security of eligible collateral, currently in the form of

designated pools of the Bank’s notes described above, with the amount available based on the

value of the security given, subject, where appropriate, to a haircut .

184 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

			2024
	Items held	Amortised	Non-financial
	at FVTPL	cost	assets/liabilities	Total
Group	£m	£m	£m	£m
Assets
Cash and cash equivalents	—	1,003.9	—	1,003.9
Investment securities	—	—	—	—
Amounts receivable from customers	—	2,153.7	—	2,153.7
Trade and other receivables	—	41.6	30.9	72.5
Investments	2.3	—	—	2.3
Current tax asset	—	—	3.9	3.9
Property, plant and equipment	—	—	7.1	7.1
Right of use assets	—	—	16.4	16.4
Goodwill	—	—	1.2	1.2
Other intangible assets	—	—	61.5	61.5
Retirement benefit asset	—	—	27.8	27.8
Deferred tax assets	—	—	25.0	25.0
Total assets	2.3	3,199.2	173.8	3,375.3
Liabilities
Trade and other payables	—	41.0	5.1	46.1
Provisions	—	—	15.5	15.5
Lease liabilities	—	32.5	—	32.5
Retail deposits	—	2,428.2	—	2,428.2
Bank and other borrowings	—	410.0	—	410.0
Derivative financial instruments	1.8	—	—	1.8
Total liabilities	1.8	2,911.7	20.6	2,934.1

29 Financial instruments

(a) Classification and measurement

The following table sets out the carrying value of the Group’s financial assets and liabilities in

accordance with the categories of financial instruments set out in IFRS 9. Assets and liabilities outside

the scope of IFRS 9 are shown within non-financial assets/liabilities:

			2025
	Items held	Amortised	Non-financial
	at FVTPL	cost	assets/liabilities	Total
Group	£m	£m	£m	£m
Assets
Cash and balances at central banks	—	804.5	—	804.5
Investment securities	—	254.6	—	254.6
Amounts receivable from customers	—	2,691.5	—	2,691.5
Trade and other receivables	—	32.2	29.0	61.2
Investments	2.4	—	—	2.4
Current tax asset	—	—	0.9	0.9
Property, plant and equipment	—	—	8.0	8.0
Right of use assets	—	—	12.1	12.1
Goodwill	—	—	1.2	1.2
Other intangible assets	—	—	65.0	65.0
Derivative financial instruments	3.9	—	—	3.9
Retirement benefit asset	—	—	6.4	6.4
Deferred tax assets	—	—	30.0	30.0
Total assets	6.3	3,782.8	152.6	3,941.7
Liabilities
Trade and other payables	—	45.1	6.7	51.8
Provisions	—	—	7.9	7.9
Lease liabilities	—	21.2	—	21.2
Retail deposits	—	3,019.9	—	3,019.9
Bank and other borrowings	—	347.5	—	347.5
Derivative financial instruments	6.1	—	—	6.1
Total liabilities	6.1	3,433.7	14.6	3,454.4

The carrying value for all financial assets represents the maximum exposure to credit risk.

The Group has pledged £796.7m (2024 £839.1m) of receivables as collateral under the securitisation

funding arrangements described in note 28. Trade receivables includes cash placed with banking

counterparties as security against the mark to market exposure on its derivative financial instruments

of £11.8m (2024: £9.4m) and collateral required by Visa to support settlement activity of £11.4m

(2024: £6.5m).

No other assets were pledged as collateral at 31 December 2025 or 31 December 2024 .

185 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

		2024
			Non-
	Items		financial
	held at	Amortised	assets/
	FVTPL	cost	liabilities	Total
Company	£m	£m	£m	£m
Assets
Cash and cash equivalents	—	10.5	—	10.5
Trade and other receivables	—	763.6	4.8	768.4
Property, plant and equipment	—	—	0.5	0.5
Right of use assets	—	—	7.4	7.4
Other intangible assets	—	—	1.4	1.4
Investment in subsidiaries	—	—	247.9	247.9
Retirement benefit asset	—	—	27.8	27.8
Derivative financial instruments	0.6	—	—	0.6
Total assets	0.6	774.1	289.8	1,064.5
Liabilities
Trade and other payables	—	18.0	2.9	20.9
Provisions	—	—	5.6	5.6
Lease liabilities	—	11.3	—	11.3
Bank and other borrowings	—	204.7	—	204.7
Derivative financial instruments	1.7	—	—	1.7
Current tax liabilities	—	—	8.2	8.2
Deferred tax liabilities	—	—	5.6	5.6
Total liabilities	1.7	234.0	22.3	258.0

29 Financial instruments continued

(a) Classification and measurement continued

Assets and liabilities outside the scope of IFRS 9 are shown within non-financial assets/liabilities:

		2025
			Non-
	Items		financial
	held at	Amortised	assets/
	FVTPL	cost	liabilities	Total
Company	£m	£m	£m	£m
Assets
Cash and cash equivalents	—	4.3	—	4.3
Trade and other receivables	—	768.3	1.5	769.8
Property, plant and equipment	—	—	—	—
Right of use assets	—	—	—	—
Other intangible assets	—	—	—	—
Investment in subsidiaries	—	—	301.0	301.0
Retirement benefit asset	—	—	6.4	6.4
Derivative financial instruments	3.7	—	—	3.7
Total assets	3.7	772.6	308.9	1,085.2
Liabilities
Trade and other payables	—	13.0	0.2	13.2
Provisions	—	—	1.1	1.1
Lease liabilities	—	—	—	—
Bank and other borrowings	—	146.6	—	146.6
Derivative financial instruments	0.4	—	—	0.4
Current tax liabilities	—	—	13.9	13.9
Deferred tax liabilities	—	—	1.0	1.0
Total liabilities	0.4	159.6	16.2	176.2

186 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

Transfers between the different levels of the fair value hierarchy would be made when the inputs used

to measure the fair value no longer satisfy the conditions required to be classified in a certain level

within the hierarchy.

Balance guarantee swaps

The securitisation and Group balance guarantee swaps are classed as Level 3 instruments as, whilst

the swaps are linked to SONIA, they have a non-standard repayment curve that is tailored to match

the expected repayment profile of the Vehicle Finance receivables. This is a combination of the

remaining contractual term and an assumption about prepayment rates. Both of these are deemed

to be unobservable inputs with the prepayment rate being the significant input.

A 5% movement on the prepayment rate would not have a material impact on the Group’s and

Company’s profit before tax.

Visa Inc shares

The valuation has been determined using a combination of observable and non-observable inputs.

As the common stock share price of Visa Inc is readily available, this input is deemed to be observable.

However, certain assumptions have been made in respect of the illiquidity adjustment to the share

price and the likelihood of future litigation costs. These inputs are therefore deemed to be significant

unobservable inputs.

The following table sets out their movement during the year:

		Group
	2025	2024
	£m	£m
At 1 January	2.3	5.4
Gain recognised in income statement	0.1	1.2
Disposal of investment	—	(4.3)
At 31 December	2.4	2.3

The illiquidity adjustment for the shares still held has been estimated at around 6% and the expected

future litigation costs have been estimated at around 15% of the Visa Inc share price. These assumptions

are consistent with 2024.

The higher the illiquidity and future litigation costs the lower the fair value. A sensitivity to the

unobservable inputs, in isolation, would not have a material impact on the Group’s profit before tax .

29 Financial instruments continued

(b) Fair values of financial assets and liabilities held at fair value

The Group and Company hold certain financial assets and liabilities at fair value, grouped into Levels

1 to 3 of the fair value hierarchy on the degree to which the fair value is observable.

The following financial assets and liabilities are held at fair value:

			Group
		2025			2024
	Level 1	Level 2	Level 3	Level 1	Level 2	Level 3
	£m	£m	£m	£m	£m	£m
Investments held at fair value through P&L:
– Visa Inc shares	—	—	2.4	—	—	2.3
Derivatives held at fair value through P&L:
– Securitisation balance guarantee swap	—	—	(2.7)	—	—	(0.3)
– Group balance guarantee swap	—	—	2.1	—	—	(0.2)
– Tier 2 swap	—	1.1	—	—	(1.3)	—
– Investment securities swaps	—	(2.5)	—	—	—	—
– Second Charge Mortgage swaps	—	(0.5)	—	—	—	—
– Deposit swaps	—	0.2	—	—	—	—
Total	—	(1.7)	1.8	—	(1.3)	1.8

				Company
		2025			2024
	Level 1	Level 2	Level 3	Level 1	Level 2	Level 3
	£m	£m	£m	£m	£m	£m
Derivatives held at fair value through P&L:
– Group balance guarantee swap	—	—	2.1	—	—	(0.2)
– Tier 2 swap	—	1.1	—	—	(1.3)	—
– Internal deposit swaps	—	—	—	—	0.4	—
Total	—	1.1	2.1	—	(0.9)	(0.2)

Level 1 fair value measurements are those derived from quoted market prices in active markets for

identical assets and liabilities.

Level 2 fair value measurements are those derived from inputs other than quoted market prices

included in Level 1 that are observable for the asset or liability either directly or indirectly. The Tier 2,

Investment securities, Second Charge Mortgage and external deposit swaps, which are over-the-

counter vanilla swaps that are not publicly traded, are classified as Level 2 instruments as their

valuation can be easily reproduced with publicly available information.

Level 3 fair value measurements are those derived from valuation techniques that include inputs for

the asset or liability that are not based on observable market data (unobservable inputs). Visa Inc

shares and the balance guarantee swaps are classified as Level 3 instruments.

187 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

The table below shows the fair value of financial assets and liabilities not presented at fair value in

the balance sheet:

		2025	2024
	Fair value	Book value	Fair value	Book value
Group	£m	£m	£m	£m
Assets
Cash and cash equivalents	804.5	804.5	1,003.9	1,003.9
Investment securities	254.3	254.6	—	—
Amounts receivable from customers	2,808.0	2,691.5	2,488.5	2,153.7
Trade and other receivables	32.2	32.2	41.6	41.6
Total assets	3,899.0	3,782.8	3,534.0	3,199.2
Liabilities
Retail deposits	2,986.3	3,019.9	2,400.4	2,428.2
Bank and other borrowings	353.6	347.5	373.2	410.0
Trade and other payables	45.1	45.1	41.0	41.0
Lease liabilities	21.2	21.2	32.5	32.5
Total liabilities	3,406.2	3,433.7	2,847.1	2,911.7

		2025	2024
	Fair value	Book value	Fair value	Book value
Company	£m	£m	£m	£m
Assets
Cash and cash equivalents	4.3	4.3	10.5	10.5
Trade and other receivables	768.3	768.3	763.6	763.6
Total assets	772.6	772.6	774.1	774.1
Liabilities
Bank and other borrowings	150.0	146.6	168.8	204.7
Trade and other payables	13.0	13.0	18.0	18.0
Lease liabilities	—	—	11.3	11.3
Total liabilities	163.0	159.6	198.1	234.0

Key considerations in the calculation of fair values of those financial assets and liabilities not presented

at fair value in the balance sheet are set out below. Where there is no significant difference between

carrying value and fair value no additional information has been presented.

The fair value of investment securities is classed as Level 1 as it has been derived using quoted

market prices

29 Financial instruments continued

(b) Fair values of financial assets and liabilities held at fair value continued

Interest rate swaps

The Group is counterparty to 24 external swaps. These swaps are detailed below:

5 Tier 2 swap: transacted to hedge the interest rate risk on the Tier 2 capital;

5 Securitisation balance guarantee swap: transacted to manage the interest rate risk on the

Vehicle Finance securitisation; and

5 Group balance guarantee swap: transacted to reverse the interest rate risk position in the Group

accounts created by the securitisation balance guarantee swap.

5 Investment securities swaps: transacted to hedge interest rate risk of UK government bonds (Gilts);

5 Second Charge Mortgage swaps: transacted to hedge interest rate risk of second-charge

mortgages portfolio;

5 Deposit swaps: transacted to hedge interest rate risk of retail deposits.

The Group balance guarantee swap was transacted at historical rates and, in compensation, the

Group received cash consideration for taking on a liability.

The following table sets out the movement during the year:

	Group		Company
	2025	2024	2025	2024
	£m	£m	£m	£m
At 1 January	(1.8)	(0.5)	(1.1)	(2.0)
Fair value (loss)/gain recognised in income statement	(0.4)	(1.3)	4.4	0.9
At 31 December	(2.2)	(1.8)	3.3	(1.1)

The fair value loss recognised in the Group’s income statement of £0.4m (2024: loss of £1.3m) is before

the application of hedge accounting. The effect of applying hedge accounting resulted in a loss of

£0.5m (2024: gain of £0.2m). The fair value gain recognised in the Company’s income statement of

£4.4m (2024: loss of £0.9m) is before the application of hedge accounting. The effect of applying

hedge accounting resulted in a loss of £2.3m (2024: gain of £2.4m).

The Company accounts do not include the securitisation balance guarantee swap, and therefore do

not benefit from the natural hedging that is achieved on consolidation .

188 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

29 Financial instruments continued

The fair value of amounts receivable from customers has been derived by discounting expected

future cash flows (net of collection costs) at the credit risk-adjusted discount rate at the balance

sheet date. They are categorised within Level 3 as the expected future cash flows and discount rate

are deemed to be significant unobservable inputs.

The fair value of retail deposits has been calculated by discounting the expected future cash flows

at the relevant market interest rate yield curves prevailing at the balance sheet date and they are

categorised within Level 3 of the fair value hierarchy as the expected future cash flows are deemed

to be significant unobservable inputs.

Within bank and other borrowings, the Tier 2 capital is classed as Level 1 as it is valued with quoted

market prices. Central bank facilities are floating rate instruments with a fair value equivalent to book

value. The fair value of the securitisation notes was calculated using a discounted cash flow and is

classed as Level 3. Whilst it uses publicly available information for the discount rate, the cash flow

forecast is not publicly available .

30 Share capital

		2025	2024
		Issued and	Issued and
Group and Company		fully paid	fully paid
Ordinary shares of 20 8⁄11p each	– £m	53.2	53.2
	– number (m)	256.5	256.5

The movement in the number of shares in issue during the year was as follows:

	2025	2024
Group and Company	m	m
At 1 January	256.5	256.5
Shares issued pursuant to the exercise/vesting of options and awards	—	—
At 31 December	256.5	256.5

There were 10,870 shares issued under the 2023 SAYE scheme in 2025. There were no shares issued in 2024.

Vanquis Banking Group plc sponsors the Vanquis Banking Group plc 2007 Employee Benefit Trust

(EBT), which is a discretionary trust established for the benefit of the employees of the Group. The

Company has appointed JTC Trust Company (CI) Limited to act as trustee of the EBT. The trustee has

waived the right to receive dividends on the shares it holds. As at 31 December 2025, the EBT held

6,161,954 (2024: 1,020,669) shares in the Company with a nominal value of £1.3m (2024: £0.2m) and a

market value of £7.4m (2024: £0.5m). The shares have been acquired by the EBT to meet obligations

under the Vanquis Banking Group Deferred Bonus Plan and the Vanquis Banking Group Restricted

Share Plan .

31 Share-based payments

The Group issues share options and awards to employees as part of its employee remuneration

packages. The Group operates four equity-settled share schemes: the Long Term Incentive Scheme

(LTIS); the Restricted Share Plan (RSP) and Company Share Option Plan (CSOP); employees’ savings-

related share option schemes typically referred to as Save As You Earn schemes (SAYE); and the

Deferred Bonus Plan (DBP).

When an equity-settled share option or award is granted, a fair value is calculated based on the

share price at grant date, the probability of the option/award vesting, the Group’s recent share price

volatility, and the risk associated with the option/award. A fair value is calculated based on the

value of awards granted and adjusted at each balance sheet date for the probability of vesting

against performance conditions.

The fair value of all options/awards is charged to the income statement on a straight-line basis over

the vesting period of the underlying option/award.

During 2025, awards/options have been granted under the RSP scheme and the SAYE (2024: awards/

options have been granted under the RSP scheme).

Equity-settled schemes

The charge to the income statement in 2025 for equity-settled schemes was £2.3m for the Group

(2024: £2.7m) and £1.0m for the Company (2024: £1.5m).

The fair value per award/option granted and the assumptions used in the calculation of the

equity-settled share-based payment charges for the Group and the Company are as follows:

	2025		2024
Group	SAYE	RSP	RSP
Grant date	9 Oct 2025	9 Sep 2025	7 May 2024
Share price at grant date (£)	1.25	1.09	0.50
Exercise price (£)	0.94	—	—
Vesting period (years)	3 & 5	3	3
Expected volatility	58.5%–63.2%	—	—
Award/option life (years)	3 or 5	3	3
Expected life (years)	3 or 5	3	3
Risk-free rate	3.7%–3.8%	—	—
Expected dividends expressed as a dividend yield	4.8%–5.9%	—	—
Fair value per award/option (£)	0.29–0.30	1.12	0.48

The expected volatility is based on historical volatility over the last three or five years depending on the

length of the option/award. The expected life is the average expected period to exercise. The risk-free

rate of return is the yield on zero coupon UK Government bonds of a similar duration to the life of the

share option.

189 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

31 Share-based payments continued

Equity-settled schemes continued

A reconciliation of award/share option movements during the year is shown below:

	RSP/CSOP 1	DBP/PSP 1	LTIS 1	SAYE
					Weighted
					average
					exercise
					price
Group	Number	Number	Number	Number	£
Outstanding at 1 January 2025	9,155,405	664,572	2,821,336	3,331,381	0.93
Awarded/granted	2,920,840	—	—	2,522,601	0.94
Lapsed	(1,881,296)	—	—	(801,004)	1.05
Vested	—	(348,911)	—	—	—
Exercised	(1,077,049)	—	—	(10,870)	0.87
Outstanding at 31 December 2025	9,117,900	315,661	2,821,336	5,042,108	0.91
Exercisable at 31 December 2025	82,938	—	—	—	—

1 The RSP/CSOP, DBP/PSP and LTIS schemes all carry a £nil value exercise price.

	RSP/CSOP 1	DBP/PSP 1	LTIS 1	SAYE
					Weighted
					average
					exercise
					price
Group	Number	Number	Number	Number	£
Outstanding at 1 January 2024	6,479,601	664,572	2,821,336	5,795,672	1.04
Awarded/granted	5,093,207	—	—	—	—
Lapsed	(1,660,998)	—	—	(2,464,291)	1.19
Vested	—	—	—	—	—
Exercised	(756,405)	—	—	—	—
Outstanding at 31 December 2024	9,155,405	664,572	2,821,336	3,331,381	0.93
Exercisable at 31 December 2024	166,038	—	—	86,387	1.01

1 The RSP/CSOP, DBP/PSP and LTIS scheme awards have a £nil value exercise price.

The amounts included in the RSP/CSOP table reflect the total amount of shares awarded under

both schemes.

Share awards outstanding under the LTIS at 31 December 2025 had an exercise price of £nil (2024:

£nil) and a weighted average remaining contractual life of 1.7 years (2024: 2.7 years). Share options

outstanding under the SAYE schemes at 31 December 2025 had exercise prices ranging from 87p to

284p (2024: 87p to 284p) and a weighted average remaining contractual life of 2.4 years (2024: 0.9

years). Share awards outstanding under the DBP schemes at 31 December 2025 had an exercise price

of £nil (2024: £nil) and a weighted average remaining contractual life of 0.3 years (2024: 0.7 years).

Share awards outstanding under the RSP at 31 December 2025 have an exercise price of £nil (2024:

£nil) and a weighted average remaining contractual life of 1.5 years (2024: 1.6 years). Share awards

outstanding under the CSOP schemes at 31 December 2025 had exercise prices of 259p (2024: 48p to

296p) and a weighted average remaining contractual life of 0.3 years (2024: 1.6 years).

	RSP/CSOP 1	DBP/PSP 1	SAYE
				Weighted
				average
				exercise
				price
Company	Number	Number	Number	£
Outstanding at 1 January 2025	6,140,869	571,865	733,350	0.93
Awarded/granted	2,098,150	—	247,004	0.94
Lapsed	(1,159,963)	—	(402,017)	0.99
Vested	—	(256,204)	—	—
Exercised	(778,873)	—	—	—
Transferred	(2,246,002)	—	(578,337)	0.92
Outstanding at 31 December 2025	4,054,181	315,661	—	—
Exercisable at 31 December 2025	18,215	—	—	—

1 The RSP/CSOP and DBP/PSP scheme awards have a £nil value exercise price.

190 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

The AT1 securities carry discretionary, non-cumulative coupons, which are payable semi-annually at a fixed

rate of 10.875% per annum. The Group may elect, at its sole discretion, to cancel any coupon payment

without constituting an event of default. The instruments do not have a fixed maturity date; however,

the Group has an option to redeem them after 1 November 2030, subject to regulatory approval.

The AT1 instruments include a loss absorption feature whereby, upon the occurrence of a trigger

event (being the Group’s Common Equity Tier 1 ratio falling below 7%), the securities will be either

written down or converted into ordinary shares, as specified in the terms and conditions.

The carrying amount of the AT1 instruments at 31 December 2025 was £58.6m (2024: £nil), which

represents the £60m issuance less directly attributable issue costs of £1.4m. There were no other

equity instruments outstanding in the prior year.

33 Related party transactions

The Company recharges the pension scheme referred to in note 22 with a proportion of the costs of

administration and professional fees incurred by the Company. The total amount recharged during

the year was £0.3m (2024: £0.3m) and the Company amount payable to the pension scheme at

31 December 2025 was £nil (2024: £nil).

Details of the transactions between the Company and its subsidiary undertakings, which comprise

management recharges and interest charges on intra-group balances, along with any balances

outstanding at 31 December, are set out below:

		2025			2024
	Management	Interest	Outstanding	Management	Interest	Outstanding
	recharge	credit	balance	recharge	credit	balance
Company	£m	£m	£m	£m	£m	£m
Vanquis Bank	9.5	(1.0)	33.8	37.5	(1.9)	23.2
Moneybarn	15.0	—	—	18.1	—	—
Provident Financial
Holdings	—	(79.9)	726.3	—	(63.7)	729.2
Other central companies	—	0.2	(4.5)	(14.1)	0.3	(12.7)
Total related party
transactions	24.5	(80.7)	755.6	41.5	(65.3)	739.7

The outstanding balance represents the gross intercompany balance receivable to/(payable by) the

Company. The amounts receivable from Vanquis Bank include £39.0m (2024: £23.0m) in relation to

amounts placed on deposit via Vanquis Bank, with the Bank of England and the year-end

management recharges.

A facility of £100m is provided from the Company via Provident Financial Holdings (PFH), the

intermediate holding company, to its subsidiary Moneybarn No. 1 Limited and £50m and £114m of

facilities were provided directly to PFH from the Company. During 2024 and up to December 2025 a

facility of £85m facility was provided via PFH to PFG Corporate Services Limited until it was placed in

members’ voluntary liquidation. The intercompany loans accrue interest at the Company’s monthly

weighted average cost of funds plus a margin.

31 Share-based payments continued

Equity-settled schemes continued

	RSP/CSOP 1	DBP/PSP 1	SAYE
				Weighted
				average
				exercise
				price
Company	Number	Number	Number	£
Outstanding at 1 January 2024	4,286,055	571,865	1,019,026	1.10
Awarded/granted	3,513,681	—	—	—
Lapsed	(1,190,461)	—	(285,676)	1.15
Vested	—	—	—	—
Exercised	(468,406)	—	—	—
Outstanding at 31 December 2024	6,140,869	571,865	733,350	0.93
Exercisable at 31 December 2024	107,486	—	12,587	1.43

1 The RSP/CSOP and DBP/PSP scheme awards have a £nil value exercise price.

There were no share options outstanding under the SAYE schemes at 31 December 2025. The awards

had an exercise price of £nil (2024: 87p to 284p) and a weighted average remaining contractual life

of nil years (2024: 0.9 years). Share awards outstanding under the DBP/PSP schemes at 31 December

2025 had an exercise price of £nil (2024: £nil) and a weighted average remaining contractual life of

0.3 years (2024: 0.8 years). Share awards outstanding under the RSP schemes at 31 December 2025

had an exercise price of £nil (2024: £nil) and a weighted average remaining contractual life of 1.3 years

(2024: 1.6 years). Share awards outstanding under the CSOP schemes at 31 December 2025 had exercise

price of 259p (2024: 48p to 296p) and a weighted average remaining contractual life of 0.3 years

(2024: 1.6 years).

32 Other equity instruments

	Group
	2025	2024
	£m	£m
At 1 January	—	—
Issued in the year	58.6	—
Profit attributable to other equity holders	0.5	—
Distributions on other equity instruments	(0.5)	—
At 31 December	58.6	—

On 1 October 2025, the Group issued Additional Tier 1 (AT1) capital securities with a nominal value

of £60m. These instruments are perpetual, subordinated and classified as equity in accordance with

IAS 32 as they do not contain any contractual obligation to deliver cash or another financial asset.

191 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

33 Related party transactions continued

The net charge to the income statement for both intercompany and investment provisions in 2025 is

£17.2m (2024: £0.2m).

Dividends were received totalling £18.4m (2024: £1.7m) in relation to non-trading and dormant

companies as part of the pre-liquidation steps before the companies were placed into members’

voluntary liquidation. Additionally, PFH approved and paid dividends to the Company totalling

£20.0m (2024: £40.0m) and PFH received equivalent dividends from Vanquis Bank.

There are no transactions with directors other than those disclosed in the Directors’ Remuneration Report.

34 Contingent liabilities

During the ordinary course of business the Group is subject to other complaints and threatened or

actual legal proceedings (including class or group action claims) brought by or on behalf of current

or former employees, customers, investors or third parties. This extends to legal and regulatory reviews,

challenges, investigations and enforcement actions combined with tax authorities taking a view that

is different to the view the Group has taken on the tax treatment in its tax returns. It also extends to

tax authorities taking the view that VAT-exempt supplies received by the Group from UK-based

suppliers should be subject to VAT.

All such material matters are periodically assessed, with the assistance of external professional

advisors, where appropriate, to determine the likelihood of the Group incurring a liability.

In those instances where it is concluded that it is more likely than not that a payment will be made,

a provision is established for management’s best estimate of the amount required at the relevant

balance sheet date.

In some cases it may not be possible to form a view, for example because the facts are unclear or

because further time is needed to properly assess the merits of the case, and no provisions are held

in relation to such matters. However, the Group does not currently expect the final outcome of any

such case to have a material adverse effect on its financial position, operations or cash flows.

35 Reconciliation of profit/(loss) after taxation to cash generated from/

(used in) operations

		Group 1		Company 1
		2025	2024	2025	2024
	Note	£m	£m	£m	£m
Profit/(loss) after taxation		8.7	(119.3)	65.8	62.3
Adjusted for:
– tax charge/(credit)	7	0.5	(17.0)	14.5	10.0
– dividends received	33	—	—	(38.3)	(41.7)
– share-based payment charge	31	2.2	2.7	1.2	1.5
– retirement benefit charge/(credit)	22	0.1	(0.4)	0.1	(0.4)
– amortisation of intangible assets	20	10.5	16.9	0.2	0.3
– impairment of intangible assets	20	—	8.5	—	—
– provisions created in the year	26	15.9	30.0	0.1	7.8
– provisions released in the year	26	(5.7)	(1.3)	(2.7)	—
– provisions utilised in the year	26	(17.8)	(17.6)	(1.1)	(2.2)
– depreciation of property, plant and equipment and right of use assets	17, 18	6.4	7.5	1.5	1.5
– impairment of right of use assets	18	—	3.5	—	2.9
– loss on disposal of property, plant
and equipment	17	0.3	0.3	—	—
– loss on disposal of intangible assets	20	1.2	—	—	—
– provision for investment impairment	21	—	—	17.2	78.5
– provision for intercompany impairment	15	—	—	—	(78.3)
– non-cash interest expense		(4.0)	(1.8)	(2.9)	0.5
– derivatives and hedging movements	23	0.4	(2.5)	(2.1)	(2.4)
– fair value movements on Visa shares	16	(0.1)	(1.2)	—	—
– contributions into the retirement benefit scheme	22	(0.8)	(0.8)	(0.8)	(0.8)
– goodwill write-off	19	—	71.2	—	—
Changes in operating assets and liabilities:
– amounts receivable from customers	14	(536.6)	4.4	—	—
– trade and other receivables	15	10.6	(16.9)	(61.0)	136.4
– trade and other payables	25	5.7	0.6	(6.0)	(214.5)
– movement in retail deposits	28	591.5	477.7	—	—
Cash generated from/(used in) operations		89.0	444.5	(14.3)	(38.6)

1 Detail on restatement set out below.

192 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

35 Reconciliation of profit/(loss) after taxation to cash generated from/

(used in) operations continued

The following changes have been made to the line items presented in the statement of cash flows,

with corresponding restatement of the cash flows for the comparative period:

5 Finance income and finance costs are no longer separately disclosed within operating cash flows.

The total amount of interest received (2024: Group: £637.8m; Company: £9.1m) and interest paid

(2024: Group: £103.0m; Company: £8.5m) in the year is now disclosed as a memo item underneath

the statement of cash flows. The Group’s 2024 disclosed total interest received has increased

significantly as it now includes £588.9m of interest received on amounts receivable from customers;

£2.3m has also been removed from this disclosure as it related to non-cash items.

5 As part of this representation, any non-cash interest is now presented as a separate reconciling

item between loss after tax and cash generated from operations. In addition, capitalised

interest on retail deposits is now included as part of the movement in retail deposits line within

this reconciliation.

5 The derivatives and hedging movements line within the reconciliation between loss after tax and

cash generated from operations now solely represents the non-cash movement in the year on

derivatives and hedge accounting adjustments.

5 Group cash outflows in relation to internally generated intangibles have been represented from

operating cash flows to investing cash flows, in line with the nature of the expenditure.

The affected financial statement line items are as follows:

		Group			Company
	As			As
	previously			previously
	presented	Adjustment	Restated	presented	Adjustment	Restated
	£m	£m	£m	£m	£m	£m
Reconciliation of profit/(loss)
after tax
Finance costs	145.4	(145.4)	—	28.0	(28.0)	—
Finance income	(47.2)	47.2	—	(69.1)	69.1	—
Internally generated
intangible additions	(12.5)	12.5	—	—	—	—
Non-cash interest expense	—	(1.8)	(1.8)	—	0.5	0.5
Derivatives and hedging movement	1.2	(3.7)	(2.5)	(4.7)	2.3	(2.4)
Trade and other payables	—	—	—	195.4	(59.0)	136.4
Movement in retail deposits	425.8	51.9	477.7	—	—	—
Statement of cash flows
Cash flow from operating activities:
Cash generated from/(used in)
operations	483.8	(39.3)	444.5	(23.5)	(15.1)	(38.6)
Finance costs paid	(103.0)	103.0	—	(31.0)	31.0	—
Finance income received	51.2	(51.2)	—	15.9	(15.9)	—
Cash flows from investing activities:
Purchase of intangible assets	—	(12.5)	(12.5)	—	—	—

There is no impact on the income statement, statement of comprehensive income, earnings per share

or balance sheet as a result of these changes.

The above changes were identified following an enquiry from the Corporate Reporting Review Team

of the FRC, as part of its regular review and assessment of the quality of corporate reporting in the

UK. The FRC has confirmed that its enquiries have now been closed.

193 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

35 Reconciliation of profit/(loss) after taxation to cash generated from/

(used in) operations continued

When reviewing the 2024 Annual Report and Accounts, the FRC has made clear the limitations of its

review as follows:

5 its review is based on the 2024 Annual Report and Accounts and does not benefit from detailed

knowledge of the Group’s business or an understanding of the underlying transactions entered into;

5 communications from the FRC provide no assurance that the Group’s 2024 Annual Report and

Accounts are correct in all material respects and are written on the basis that the FRC (including

its officers, employees and agents) accepts no liability for reliance on them by the Group or any

third party, including but not limited to investors and shareholders; and

5 the FRC’s role is not to verify the information provided to it but to consider compliance with

reporting requirements.

The increase in amounts receivable from customers of £536.6m (2024: £4.4m decrease) includes the

non-cash movement in the impairment provision as set out below.

	2025	2024
Group	£m	£m
Cash movement in amounts receivable from customers	(518.4)	322.9
Non-cash provision movement – allowance account	(18.2)	(318.5)
Net movement in amounts receivable from customers	(536.6)	4.4

The table below details changes in the Group and Company’s liabilities arising from financing

activities, including both cash and non-cash changes. Liabilities arising from financing activities are

those for which cash flows were, or future cash flows will be, classified in the cash flow statement as

cash flows from financing activities.

	Bank
	and other	Lease
	borrowings	liabilities
	(note 28)	(note 27)	Total
Group	£m	£m	£m
1 January 2025	(410.0)	(32.5)	(442.5)
Cash changes
Financing cash flows	63.5	—	63.5
Lease payments	—	10.0	10.0
Non-cash changes
Amortised fees	(1.5)	—	(1.5)
Interest paid	2.6	0.7	3.3
Included within overdrafts	0.2	—	0.2
Derivatives	(2.3)	—	(2.3)
Lease additions and disposals	—	0.6	0.6
31 December 2025	(347.5)	(21.2)	(368.7)

	Bank
	and other	Lease
	borrowings	liabilities
	(note 28)	(note 27)	Total
Group	£m	£m	£m
1 January 2024	(582.5)	(40.9)	(623.4)
Cash changes
Financing cash flows	169.0	—	169.0
Lease payments	—	12.7	12.7
Non-cash changes
Amortised fees	(0.7)	—	(0.7)
Interest paid	2.3	(3.0)	(0.7)
Included within overdrafts	0.4	—	0.4
Derivatives	1.5	—	1.5
Lease additions and disposals	—	(1.3)	(1.3)
31 December 2024	(410.0)	(32.5)	(442.5)

194 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

35 Reconciliation of profit/(loss) after taxation to cash generated from/

(used in) operations continued

	Bank
	and other	Lease
	borrowings	liabilities
	(note 28)	(note 27)	Total
Company	£m	£m	£m
1 January 2025	(204.7)	(11.3)	(216.0)
Cash changes
Financing cash flows	58.5	—	58.5
Lease payments	—	3.3	3.3
Non-cash changes
Amortised fees	(0.4)	—	(0.4)
Interest paid	2.3	0.2	2.5
Included within overdrafts	—	—	—
Derivatives	(2.3)	—	(2.3)
Lease additions and disposals	—	7.8	7.8
31 December 2025	(146.6)	—	(146.6)

	Bank
	and other	Lease
	borrowings	liabilities
	(note 28)	(note 27)	Total
Company	£m	£m	£m
1 January 2024	(205.7)	(13.6)	(219.3)
Cash changes
Financing cash flows	—	—	—
Lease payments	—	3.4	3.4
Non-cash changes
Amortised fees	(0.5)	—	(0.5)
Interest paid	—	(0.4)	(0.4)
Included within overdrafts	—	—	—
Derivatives	1.5	—	1.5
Lease additions and disposals	—	(0.7)	(0.7)
31 December 2024	(204.7)	(11.3)	(216.0)

36 Country-by-Country Reporting

The Capital Requirements (Country-by-Country Reporting) Regulations 2013 came into effect on

1 January 2014 and place certain reporting obligations on financial institutions as defined by EU

Regulation No. 575/2013 (the capital requirements regulation). The objective of the country-by-country

reporting requirements is to provide increased transparency regarding the source of the financial

institution’s income and the locations of its operations.

Vanquis Banking Group plc is a UK registered entity. Details of its subsidiaries are given in note 38

and the activities of the Group are described in the Strategic Report on pages 1 to 17.

The activities of the Group, described as required by the Regulations for the year ended 31 December

2025 were:

	United Kingdom
	2025	2024
Interest payable on:	£m	£m
Total operating income (including discontinued operations)	456.0	458.6
Profit/(loss) before tax (including discontinued operations)	9.2	(136.3)
Corporation tax received	4.0	8.2
Public subsidies received	—	—
Average number of employees	1,279	1,375

37 Post-balance sheet events

There have been no significant events since the balance sheet date that require disclosure in these

financial statements.

195 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Notes to the financial statements continued

38 Details of subsidiary undertakings

The subsidiary undertakings of the Group at 31 December 2025 are shown below. The Company is the

parent or ultimate parent of all subsidiaries and they are all 100% owned by the Group.

	Company
Company name	number
Registered at No. 5 Godwin Street, Bradford BD1 2AH:
Provident Financial Holdings Limited	13061852
Provident SPV Limited 1,2	12988335
Vanquis Bank Limited 1	2558509
N&N Simple Financial Solution Limited 1	3803565
Cheque Exchange Limited 1	2927947
PFG Corporate Services Limited 1,2	13423666
Provfin Limited 2	1879771
Provident Financial Group Limited 2	194214
Aquis Cards Limited	7036307
Registered at Athena House, Bedford Road, Petersfield, Hampshire GU32 3LJ:
Moneybarn No. 1 Limited 1	4496573
Duncton Group Limited 1	6308608
Moneybarn Group Limited 1,2	4525773
Moneybarn Limited 1,2	2766324
Registered at 10 Norwich Street, London EC4A 1BD:
Usnoop Limited 1	11797870
Registered at C/O DWF LLP, 2 Semple Street, Edinburgh EH3 8BL:
Lawson Fisher Limited	SC004758

1 Companies whose immediate parent is not Vanquis Banking Group plc.

2 As part of the continued rationalisation of the Group these companies have been placed into members’ voluntary liquidation.

The following companies act as a vehicle to allow the securitisation of the Moneybarn customer

receivables and Vanquis Bank Limited’s drawings under central bank facilities. These companies are

not owned by Vanquis Banking Group plc but form part of the consolidated Group due to meeting

the requirements of IFRS 10 Consolidated Financial Statements.

	Company
Company name	number
Registered at 8th Floor, 100 Bishopsgate, London, England EC2N 4AG:
Moneybarn Financing Limited	12323134

	Company
Company name	number
Registered at 10th Floor, 5 Churchill Place, London, England E14 5HU:
Oban Cards 2021-1 Holdings Limited	12754762
Oban Cards 2021-1 PLC	12757121
Oban Cards Receivables Trustee Limited	12756504

The following subsidiaries are taking an audit exemption and are therefore exempt from the

requirement to the audit of accounts under section 479A of the Companies Act 2006.

	Company
Company name	number
N&N Simple Financial Solution Limited	3803565
Usnoop Limited	11797870
Duncton Group Limited	6308608
Cheque Exchange Limited	2927947
Lawson Fisher Limited	SC004758

196 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

APM Method of calculation Relevance

Total income

margin

Total income for the 12 months ended 31 December as a

percentage of average gross receivables.

2025

£m

2024

£m

Total income 454.9 446.4

Average gross receivables 2,495.3 2,207.0

Total income margin (%) 18.2% 20.2%

This measure shows the

returnsfrom customers

beforeimpairment charges

Risk-adjusted

margin

Total income less impairment charges for the 12 months

ended 31 December as a percentage of average gross

receivables.

2025

£m

2024

£m

Total income 454.9 446.4

Impairment (181.1) (185.3)

Risk-adjusted income 273.8 261.1

Average gross receivables 2,495.3 2,207.0

Risk-adjusted margin (%) 11.0% 11.8%

This measure shows the

returnsfrom customers

afterimpairment charges.

Asset yield Interest income received from customers for the 12 months

ended 31 December as a percentage of average

grossreceivables.

2025

£m

2024

£m

Interest income 567.2 549.9

Less: non-customer

interestincome (44.1) (47.2)

Customer interest income 523.1 502.7

Average gross receivables 2,495.3 2,207.0

Asset yield (%) 21.0% 22.8%

This measure shows the

returnsgenerated from

customer receivables to allow

comparison to other banks

andbanking groups.

In addition to statutory results and KPIs reported under International Financial Reporting Standards

(IFRS), the Group provides certain alternative performance measures (APMs). These APMs are used

internally by management and are also deemed helpful in understanding the Group’s performance.

These non-statutory measures should not be considered as replacements for IFRS measures.

Definitions, numerical reconciliations and relevance of APMs presented within this report are set out

below. The definition of these non-statutory measures may not be comparable to similarly titled

measures reported by other companies. All the below APMs are on a continuing operations basis.

2024 KPIs have been represented where required. Refer to material accounting policy information

fordetails.

APM Method of calculation Relevance

Net interest

margin (NIM)

Interest income less interest expense for the 12 months

ended 31 December as a percentage of average

grossreceivables.

2025

£m

2024

£m

Interest income 567.2 549.9

Interest expense (148.8) (142.0)

Net interest income 418.4 407.9

Average gross receivables 2,495.3 2,207.0

NIM (%) 16.8% 18.5%

This measure shows the returns

generated from customers to

allow comparison to other

banks and banking groups.

Net interest

margin

excluding

Second Charge

Mortgages

(2CM)

Interest income less interest expense for the 12 months

ended 31 December (excluding 2CM) as a percentage of

average gross receivables (excluding 2CM).

2025

£m

2024

£m

Net interest income 418.4 407.9

Less: 2CM net interest income (10.6) (1.4)

Net interest income

(excluding2CM) 407.8 406.5

Average gross receivables 2,495.3 2,207.0

Less: 2CM average

grossreceivables (390.6) (69.0)

Average gross receivables 2,104.7 2,138.0

NIM (excluding 2CM) (%) 19.4% 19.0%

This measure shows the returns

generated from customers

(excluding 2CM customers) to

allow comparison to other

banks and banking groups.

Alternative performance measures

197 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

APM Method of calculation Relevance

Return on

tangible

equity(ROTE)

Statutory profit/(loss) attributable to ordinary

shareholders for the 12 months ended 31 December

asa percentage of average tangible equity for the

13months ended 31 December. Average tangible

equity is stated as equity after deducting the Group’s

pension asset, net of deferred tax, intangible assets,

goodwill and AT1 notes net of issue costs.

2025

£m

2024

£m

Profit/(loss) attributable to

ordinary shareholders 8.2 (119.3)

Average tangible equity

Average equity as per balance

sheet 451.2 529.5

Average pension asset (18.0) (33.7)

Average deferred tax on

pension asset 4.5 8.4

Average adjusted equity 437.7 504.2

Average intangible assets (62.5) (65.7)

Average goodwill (1.2) (66.9)

Average AT1 notes (13.5) —

Average tangible equity 360.5 371.6

ROTE 2.3% (32.1)%

This demonstrates how well

theGroup’s returns are

generated from its tangible

equity, removing the impact

ofwhether development has

occurred through organic

orinorganic growth.

APM Method of calculation Relevance

Cost of risk Impairment charges for the 12 months ended 31 December

as a percentage of average gross receivables.

2025

£m

2024

£m

Impairment charges 181.1 185.3

Average gross receivables 2,495.3 2,207.0

Cost of risk (%) 7.3% 8.4%

This measure shows the cost

ofimpairment charges on

customer receivables to allow

comparison to other banks

andbanking groups.

Average gross

receivables

Average of gross customer interest-earning balances for

the 13 months ended 31 December.

2025

£m

2024

£m

Credit Cards 1,367.4 1,312.5

Vehicle Finance 737.3 825.4

Second Charge Mortgages 390.6 69.0

Total average gross receivables 2,495.3 2,207.0

This is used to align the

receivables movement to

thesame period in which the

income statement measures

aregenerated in calculating

performance KPIs.

Cost: income

ratio

Operating costs as a percentage of total income for the

12 months ended 31 December.

2025

£m

2024

£m

Operating costs 265.5 399.1

Total income 454.9 446.4

Cost: income ratio 58.4% 89.4%

This ratio is a measure of

theefficiency of the Group’s

cost base.

Alternative performance measures continued

198 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

APM Method of calculation Relevance

Funding

headroom

Committed bank and debt facilities less borrowings

onthose facilities and amounts committed to further

syndicated bank facility reduction, plus available cash

and liquid resources (see note 28 for more details).

This represents the difference

between the total amount of

committed contractual debt

facilities provided by banks,

bond holders and other lenders

and the amount of funds drawn

on those facilities plus cash held

on deposit.

Liquidity

coverage

ratio (LCR)

A regulatory measure that assesses net 30-day cash

outflows as a proportion of high-quality liquid assets

(HQLA).

This demonstrates the

Group’sability to meet its

short-term liabilities.

Customer

satisfaction

The rate at which surveyed customers were satisfied

(ormore than satisfied) with the service they have

beenprovided.

Tier 1 ratio The ratio of the Group’s Tier 1 capital to the Group’s

risk-weighted assets measured in accordance with the

Capital Requirements Regulation (CRR).

The CET1 ratio is a key measure

of whether a firm has adequate

CET1 to cover the risks

associated with its assets.

Total capital

ratio (TCR)

The ratio of the Group’s total regulatory capital (own

funds) to the Group’s risk-weighted assets measured in

accordance with the CRR.

The Tier 1 ratio is a key measure

of whether a firm has adequate

capital resources to cover the

risks associated with its assets.

Regulatory

capital

Common Equity Tier 1 (CET1) capital is the sum of the

Group’s equity as calculated in accordance with IFRS,

anaccrued foreseeable dividend and regulatory

adjustments. Tier 2 is the sum of capital instruments

meeting the criteria for Tier 2 as set out in the Capital

Requirements Regulation (CRR). Total available

regulatory capital is the sum of these two elements for

the Group (as the Group does not hold any Additional

Tier 1 instruments). The calculation is set out under

capital risk management on page 155.

Alternative performance measures continued

199 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Information for shareholders

Share price

The Company’s shares are listed on the London Stock Exchange under share code ‘VANQ’. The share

price is quoted daily in a number of national newspapers and is available on the Group’s website at

www.vanquis.com/investors.

Tax on dividends

Please refer to HMRC guidance regarding the taxation of dividends paid by the Company.

Registrar

The Company’s registrar is:

MUFG Pension & Market Services

Central Square

29 Wellington Street

Leeds

LS1 4DL

Shareholder helpline

For information relating to your shares call: +44 (0)371 664 0300

Calls to 0371 are charged at the standard geographic rate and will vary by provider.

Calls outside the United Kingdom are charged at the applicable international rate.

The office is open between 09:00 -17:30, Monday to Friday excluding public holidays in England

andWales.

Investor Centre

The Investor Centre is tailored to meet the specific needs of shareholders and investors. Through

theInvestor Centre shareholders can easily access and manage their holdings overseen by MUFG

Corporate Markets. The Investor Centre is available both as a web portal and a mobile app, allowing

users to manage their holdings form any device at any time. For further information please visit

https://uk.investorcentre.mpms.mufg.com/Login/Login

Dividend ReinvestmentPlan (DRIP)

MUFG Corporate Markets Trustees (UK) Limited offers a Dividend Reinvestment Plan (DRIP)

whereshareholders can acquire shares in the Company by using cash dividends to purchase

additional shares.

For further information write to:

Dividend Reinvestment Plans

MUFG Corporate Markets

Central Square

29 Wellington Street

Leeds LS1 4DL

Or Telephone: 0371 664 0381

Calls are charged at the standard geographic rate and will vary by provider. Calls outside the UK

willbe charged at the applicable international rate. Lines are open between 9.00am and 5.30pm,

Monday to Friday excluding public holidays in England and Wales.

Or email: DRIP.Enquiries@cm.mpms.mufg.com

Or visit the website uk.investorcentre.mpms.mufg.com

Special requirements

A PDF version of the full Annual Report and Financial Statements is available on our website.

200 – Vanquis Banking Group plc Annual Report and Accounts 2025

Governance Financial statementsStrategic report Shareholder information

Advisors

Independent auditor

Deloitte LLP

4 Brindley Place

Birmingham

B1 2HZ

Company advisors and stockbrokers

Berenberg

60 Threadneedle Street

London

EC2R 8HP

Panmure Liberum

Ropemaker Place

25 Ropemaker Street

London

EC2Y 9LY

Fenchurch Advisory Partners LLP

110 Bishopsgate

London

EC2N 4AY

Solicitors

Clifford Chance LLP

10 Upper Bank Street

London

E14 5JJ

Company details

Registered office and contact details:

Vanquis Banking Group plc

Fairburn House

5 Godwin Street

Bradford

West Yorkshire

England

BD1 2AH

Telephone: +44 (0)1274 351 351

Fax: +44 (0)1274 730 606

Website: www.vanquis.com

Company number

668987

Information for shareholders continued

Vanquis Banking Group plc’s commitment to environmental issues is

reflected in this Annual Report, which has been printed on Magno Satin, an

FSC

certified material. This document was printed by Park Communications

using its environmental print technology, which minimises the impact of

printing on the environment, with 99% of dry waste diverted from landfill.

Both the printer and the paper mill are registered to ISO 14001.

Vanquis Banking Group plc Annual Report and Accounts 2025

Vanquis Banking Group

Fairburn House

5 Godwin Street

Bradford

BD1 2AH

United Kingdom

+44 (0)1274 351 351

www.vanquis.com

Company number 668987

View and download the online version here: