PART I [Business](index=6&type=section&id=Item%201.%20Business) Freedom Holding Corp. offers brokerage, banking, and insurance services, primarily in Kazakhstan and Europe, leveraging a digital fintech ecosystem and strategic acquisitions - The company has realigned its business into four new reportable segments starting in calendar 2024: Brokerage, Banking, Insurance, and Other[22](index=22&type=chunk) Company Snapshot (as of March 31, 2024) | Metric | Value | | :--- | :--- | | Employees | 6,197 | | Total Offices | 161 | | - Brokerage Offices | 46 | | - Insurance Offices | 52 | | - Banking Offices | 20 | | Retail Brokerage Customer Accounts | 530,000 | - FRHC's business strategy focuses on opportunistic acquisitions, creating an integrated digital fintech ecosystem, continued organic growth into new countries, adhering to conservative risk management, and aspiring to excellence in governance and compliance[31](index=31&type=chunk)[32](index=32&type=chunk)[36](index=36&type=chunk) - The company is expanding its digital fintech ecosystem by entering the telecommunications market in Kazakhstan through its subsidiary, Freedom Telecom, and the media market through Freedom Media[61](index=61&type=chunk)[62](index=62&type=chunk)[63](index=63&type=chunk) [Products and Services](index=8&type=section&id=Item%201.%20Business-Products%20and%20Services) The company operates through Brokerage, Banking, Insurance, and Other segments, offering diverse financial and ancillary digital services Brokerage Customer Account Growth | Date | Total Accounts | Active Accounts | | :--- | :--- | :--- | | March 31, 2024 | 530,000 | 96,000 | | March 31, 2023 | 370,000 | 52,000 | | March 31, 2022 | 250,000 | 53,000 | Freedom Bank KZ Key Metrics (YoY Change as of March 31, 2024) | Metric | YoY Growth | | :--- | :--- | | Assets | +52% | | Loan Portfolio | +68% | | Deposit Portfolio | +47% | | Trading Portfolio | +69% | - Freedom Bank KZ is a leader in digital banking in Kazakhstan, offering innovative products like digital mortgages (**7,747 issued in FY2024**) and digital car loans (**14,202 issued in FY2024**)[47](index=47&type=chunk)[50](index=50&type=chunk) - The Insurance segment, consisting of Freedom Life and Freedom Insurance, was acquired in May 2022 from the company's CEO, Timur Turlov. In FY2024, Freedom Life's gross premiums grew **121%** and Freedom Insurance's written premiums grew **84%**[52](index=52&type=chunk)[54](index=54&type=chunk) [Regulation](index=19&type=section&id=Item%201.%20Business-Regulation) The company operates under extensive financial regulations across multiple jurisdictions, maintaining significant excess regulatory capital and robust AML/KYC compliance Regulatory Capital (as of March 31, 2024) | Metric | Amount (USD) | | :--- | :--- | | Aggregate Net Capital Requirements | ~$245.9 million | | Aggregate Excess Regulatory Capital | $573.3 million | - The company holds brokerage, banking, and insurance licenses in various jurisdictions, including Kazakhstan (ARDFM, AFSA), Cyprus (CySEC), and the U.S. (FINRA)[103](index=103&type=chunk) - As of March 31, 2024, customer liabilities related to sanctioned individuals and entities represented approximately **3.4%** of total customer liabilities, primarily consisting of cash in blocked accounts[134](index=134&type=chunk) - The company has implemented the Sum and Substance KYC/AML compliance suite across key subsidiaries to enhance customer verification and screening processes[135](index=135&type=chunk) [Risk Factors](index=26&type=section&id=Item%201A.%20Risk%20Factors) The company faces diverse material risks including operational, credit, related party, geopolitical, regulatory, and cybersecurity vulnerabilities - A significant portion of fee and commission income has historically been derived from transactions with FST Belize, an affiliate controlled by the CEO. In fiscal years 2024, 2023, and 2022, approximately **14%**, **60%**, and **82%** of fee and commission income, respectively, came from this relationship, which was terminated as of March 31, 2024[161](index=161&type=chunk) - The company faces revenue concentration risk, with a significant portion of trading income derived from Kazakhstan government or quasi-government debt securities (**93% in FY2024**) and fee income from specific institutional market maker customers[181](index=181&type=chunk) - The ongoing Russia-Ukraine conflict poses significant risks, including potential secondary sanctions, impacts on relationships with counterparties, and sanctions imposed by Ukraine on the CEO, Timur Turlov[220](index=220&type=chunk)[221](index=221&type=chunk)[222](index=222&type=chunk) - The company's new telecommunications (Freedom Telecom) and media businesses are expected to incur losses in their initial years, which will adversely affect consolidated net income[166](index=166&type=chunk) - In the past, material weaknesses in internal control over financial reporting were identified, related to a lack of sufficient qualified accounting personnel and control design. These were reported as remediated as of March 31, 2024[306](index=306&type=chunk)[308](index=308&type=chunk)[309](index=309&type=chunk) [Unresolved Staff Comments](index=53&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments - None[321](index=321&type=chunk) [Cybersecurity](index=53&type=section&id=Item%201C.%20Cybersecurity) Cybersecurity risk management, led by the CTO, employs a three-lines-of-defense model, with no material adverse incidents reported - The cybersecurity risk governance model consists of three lines of defense: 1) CTO and IT/cybersecurity teams, 2) Chief Risk Officer and Risk Committee, and 3) Controlling Department and Audit Committee[326](index=326&type=chunk) - The company maintains an IT and cybersecurity incident management process for responding to threats and reporting material incidents to senior management and the board[325](index=325&type=chunk) - The company does not maintain insurance policies to mitigate cybersecurity risks, as it may not be available or may be more expensive than the perceived benefit[332](index=332&type=chunk) [Properties](index=54&type=section&id=Item%202.%20Properties) The company operates from 265 leased facilities and 20 owned buildings across its business segments, including its principal executive offices Property Overview | Type | Count/Area | | :--- | :--- | | Leased Facilities | 265 offices (~562,380 sq ft) | | Owned Buildings | 20 buildings (~287,913 sq ft) | [Legal Proceedings](index=54&type=section&id=Item%203.%20Legal%20Proceedings) The company faces routine legal proceedings, including an ongoing case with the Estate of Toleush Tolmakov for which $8.4 million has been deposited - The company is in litigation with the Estate of Toleush Tolmakov regarding assets from the company's predecessor, BMB Munai, Inc. An amount of **$8.4 million** has been deposited with the court in relation to this matter[342](index=342&type=chunk) [Mine Safety Disclosures](index=55&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[343](index=343&type=chunk) PART II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=56&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on Nasdaq and KASE, with no dividends paid or anticipated, and no equity repurchases in fiscal 2024 - The company's common stock (FRHC) trades on both the Nasdaq Capital Market and the Kazakhstan Stock Exchange (KASE)[346](index=346&type=chunk) - No cash dividends have been declared or paid for the past two fiscal years, and the company does not anticipate paying dividends in the foreseeable future[348](index=348&type=chunk) - The company did not sell any unregistered equity securities or repurchase any of its equity securities during fiscal 2024[354](index=354&type=chunk)[355](index=355&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=57&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Fiscal 2024 saw significant financial growth, with total net revenues reaching **$1.635 billion** and net income **$375.0 million**, driven by strong interest, fee, and insurance income Fiscal 2024 Financial Highlights vs. Fiscal 2023 | Metric | FY 2024 | FY 2023 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Total Revenues, Net | $1,635.1M | $795.7M | +$839.4M | +105% | | Interest Income | $828.2M | $294.7M | +$533.5M | +181% | | Fee and Commission Income | $440.3M | $327.2M | +$113.1M | +35% | | Insurance Underwriting Income | $264.2M | $115.4M | +$148.8M | +129% | | Net Income | $375.0M | $205.6M | +$169.4M | +82% | | Total Assets | $8.3B | $5.1B | +$3.2B | +63% | - The company adopted the new CECL accounting standard (ASC 326) for credit losses on April 1, 2023, which changes the methodology from an incurred loss model to a lifetime expected credit loss model[364](index=364&type=chunk)[533](index=533&type=chunk) - Key factors affecting results include market conditions, significant growth in retail brokerage customers (from **370,000 to 530,000 YoY**), the divestiture of Russian subsidiaries, strategic acquisitions, and expansion into new business areas like telecommunications[367](index=367&type=chunk)[371](index=371&type=chunk) - The omnibus brokerage relationship with related party FST Belize was terminated as of March 31, 2024. This relationship contributed **14%** of fee and commission income in FY2024, down from **60%** in FY2023 and **82%** in FY2022[387](index=387&type=chunk)[389](index=389&type=chunk) [Results of Operations](index=66&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations-Results%20of%20Operations) Fiscal 2024 total revenue doubled to **$1.635 billion**, driven by significant growth in interest, fee, and insurance income, alongside a proportional increase in expenses Revenue Breakdown (FY2024 vs FY2023) | Revenue Source | FY 2024 ($M) | FY 2023 ($M) | % Change | | :--- | :--- | :--- | :--- | | Fee and commission income | 440.3 | 327.2 | +35% | | Net gain on trading securities | 133.9 | 71.1 | +88% | | Interest income | 828.2 | 294.7 | +181% | | Insurance underwriting income | 264.2 | 115.4 | +129% | | **Total Revenue, Net** | **1,635.1** | **795.7** | **+105%** | Expense Breakdown (FY2024 vs FY2023) | Expense Category | FY 2024 ($M) | FY 2023 ($M) | % Change | | :--- | :--- | :--- | :--- | | Fee and commission expense | 154.4 | 65.7 | +135% | | Interest expense | 501.1 | 208.9 | +140% | | Insurance claims incurred, net | 139.6 | 77.3 | +80% | | Payroll and bonuses | 181.0 | 81.8 | +121% | | **Total Expense** | **1,199.7** | **559.8** | **+114%** | - The increase in fee and commission income was driven by a **16%** rise in brokerage services income and a **552%** increase in payment processing commissions, the latter due to the acquisition of Paybox[425](index=425&type=chunk)[426](index=426&type=chunk) - The **140%** surge in interest expense was primarily due to a **$244.1 million** increase in interest on securities repurchase agreements used to finance the investment portfolio[457](index=457&type=chunk) [Liquidity and Capital Resources](index=82&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations-Liquidity%20and%20Capital%20Resources) Liquidity is driven by operations and debt, with total assets at **$8.3 billion** and significant capital expenditures for new business ventures Key Balance Sheet and Liquidity Metrics (as of March 31) | Metric | 2024 | 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | $545.1M | $581.4M | | Trading securities | $3,688.6M | $2,412.6M | | Total assets | $8,301.9M | $5,084.6M | | Total liabilities | $7,135.0M | $4,313.8M | | Net cash used in operating activities | ($1,064.4M) | ($951.7M) | - Short-term financing is primarily obtained through securities repurchase agreements. As of March 31, 2024, **$2.8 billion (75%)** of the trading securities portfolio was subject to repurchase obligations[522](index=522&type=chunk) - The company issued **$200 million** in bonds due 2028 in December 2023 to help finance the development of its Freedom Telecom business[524](index=524&type=chunk) - As of March 31, 2024, all regulated subsidiaries exceeded their minimum net capital and capital adequacy requirements, with aggregate excess regulatory capital of **$573.3 million**[527](index=527&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=88&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces market risks including interest rate, foreign currency, equity price, and significant credit risk from its proprietary portfolio and margin lending - A hypothetical **100 basis point** increase in interest rates would decrease the fair market value of the investment portfolio by an estimated **$128.9 million** as of March 31, 2024[549](index=549&type=chunk) - A **10%** adverse change in the U.S. dollar's value against all other currencies would result in an estimated increase in income before tax of **$121.5 million** as of March 31, 2024[553](index=553&type=chunk) Proprietary Portfolio Credit Quality (March 31, 2024) | Rating | Value (in thousands USD) | | :--- | :--- | | >BB | $3,519,719 | | <BB | $109,740 | | Not rated | $59,161 | | **Total** | **$3,688,620** | - Margin lending receivables increased to **$1.635 billion** as of March 31, 2024. This credit risk is mitigated by real-time margin compliance monitoring and collateralization[558](index=558&type=chunk) [Financial Statements and Supplementary Data](index=92&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents audited financial statements with an unqualified opinion from Deloitte LLP, highlighting critical audit matters including related party transactions and credit loss allowance - The independent auditor, Deloitte LLP, issued an unqualified opinion on the financial statements for fiscal years 2024 and 2023, and on the effectiveness of internal control over financial reporting as of March 31, 2024[577](index=577&type=chunk)[579](index=579&type=chunk) - Critical Audit Matters identified by the auditor include: 1) Revenue from related party FST Belize due to the use of omnibus accounts and the magnitude of revenues; 2) Revenue recognition for payment processing IT infrastructure due to high automation and complexity; 3) The allowance for credit losses due to the significant management judgments required after adopting the new CECL standard (ASC 326)[585](index=585&type=chunk)[588](index=588&type=chunk)[593](index=593&type=chunk) Consolidated Balance Sheet Summary (in thousands USD) | Account | March 31, 2024 | March 31, 2023 | | :--- | :--- | :--- | | **Total Assets** | **$8,301,930** | **$5,084,558** | | Cash and cash equivalents | $545,084 | $581,417 | | Trading securities | $3,688,620 | $2,412,556 | | Loans issued | $1,381,715 | $826,258 | | **Total Liabilities** | **$7,134,972** | **$4,313,822** | | Securities repurchase agreement obligations | $2,756,596 | $1,517,416 | | Customer liabilities | $2,273,830 | $1,925,247 | | **Total Shareholders' Equity** | **$1,166,958** | **$770,736** | Consolidated Statement of Operations Summary (in thousands USD) | Account | Year Ended March 31, 2024 | Year Ended March 31, 2023 | | :--- | :--- | :--- | | **Total Revenue, Net** | **$1,635,080** | **$795,693** | | **Total Expense** | **$1,199,709** | **$559,755** | | Income from Continuing Operations | $374,952 | $193,162 | | **Net Income** | **$374,952** | **$205,586** | | **Net Income Attributable to Controlling Interest** | **$375,540** | **$205,140** | [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=178&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes in or disagreements with accountants on accounting and financial disclosure - None[934](index=934&type=chunk) [Controls and Procedures](index=178&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that disclosure controls and internal control over financial reporting were effective as of March 31, 2024, with prior material weaknesses remediated - Management concluded that disclosure controls and procedures were effective as of March 31, 2024[935](index=935&type=chunk) - Previously reported material weaknesses in internal control over financial reporting, related to a lack of sufficient qualified technical accounting personnel and control design, have been remediated as of March 31, 2024[936](index=936&type=chunk)[938](index=938&type=chunk) - Management concluded that internal control over financial reporting was effective as of March 31, 2024, based on the COSO framework[942](index=942&type=chunk) [Other Information](index=179&type=section&id=Item%209B.%20Other%20Information) No Rule 10b5-1 or non-Rule 10b5-1 trading arrangements were adopted or terminated by directors or executive officers during the reporting period - No Rule 10b5-1 or non-Rule 10b5-1 trading arrangements were adopted or terminated by directors or executive officers during the reporting period[945](index=945&type=chunk) PART III [Directors, Executive Officers and Corporate Governance](index=180&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information on directors, executive officers, and corporate governance, including insider trading policies, is incorporated by reference from the 2024 proxy statement - The company's Board of Directors has adopted insider trading policies and procedures to promote compliance with insider trading laws[951](index=951&type=chunk) [Executive Compensation](index=180&type=section&id=Item%2011.%20Executive%20Compensation) Executive compensation information is incorporated by reference from the company's definitive 2024 proxy statement [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=180&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Security ownership information for beneficial owners and management is incorporated by reference from the 2024 proxy statement [Certain Relationships and Related Transactions, and Director Independence](index=180&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Information on certain relationships, related transactions, and director independence is incorporated by reference from the 2024 proxy statement [Principal Accounting Fees and Services](index=180&type=section&id=Item%2014.%20Principal%20Accounting%20Fees%20and%20Services) Principal accounting fees and services information is incorporated by reference from the company's definitive 2024 proxy statement PART IV [Exhibits, Financial Statement Schedules](index=181&type=section&id=Item%2015.%20Exhibits%2C%20Financial%20Statement%20Schedules) This section lists financial statements and exhibits, including corporate governance documents and material contracts, filed as part of the annual report [Form 10-K Summary](index=183&type=section&id=Item%2016.%20Form%2010-K%20Summary) No Form 10-K summary is provided - None[963](index=963&type=chunk)

Group 1: Financial Freedom and Investment Opportunities - The concept of financial freedom, particularly the FIRE (Financial Independence, Retire Early) movement, is gaining traction as a response to workplace stress [1][11] - Companies that provide stable and predictable business models are highlighted as potential long-term investments [2] Group 2: Ceva (CEVA) - Ceva specializes in silicon and software intellectual property solutions for semiconductor and OEM companies, focusing on IoT connectivity and AI protocols [4] - In the trailing 12 months, Ceva reported a net loss of $21.19 million with revenue of $93.23 million; analysts expect a significant improvement in fiscal 2024 with an anticipated EPS of 27 cents, a 170% increase, and sales reaching $103.35 million, up 6.1% [5] - Analysts unanimously rate Ceva as a strong buy, with a price target of $2.50, indicating a potential upside of approximately 144% [7] Group 3: CRISPR Therapeutics (CRSP) - CRISPR is a gene-editing company focused on developing medicines for serious diseases, utilizing its CRISPR-associated protein 9 (Cas9) platform [30] - In the trailing 12 months, CRISPR incurred a net loss of $217.14 million with revenue of $271.71 million; while a down year is expected in fiscal 2024, sales could reach $3.31 billion in fiscal 2025 according to optimistic analysts [8] Group 4: PayPal (PYPL) - PayPal is positioned as a key player in the gig economy, with a net income of $4.34 billion and revenue of $30.43 billion in the trailing 12 months [9][10] - Analysts project an EPS of $4.21 and sales of just under $32 billion for the end of the year, translating to a top-line growth of 15% [33] Group 5: Pixelworks (PXLW) - Pixelworks develops semiconductor and software solutions, particularly in image-processing integrated circuits, and serves various markets including mobile and cinema [28] - The company reported revenue of $65.77 million in the trailing 12 months, with a year-over-year growth rate of 61.1%; however, fiscal 2024 may be a down year, with sales projected to rise to $75.73 million in fiscal 2025 [29] Group 6: PepsiCo (PEP) - PepsiCo is expected to remain relevant despite concerns over the obesity crisis, as it specializes in caffeinated beverages and energy drinks, which are projected to grow [21][35] - The company offers a forward yield of 4.16%, making it an attractive option for investors seeking stable returns [24] Group 7: Chevron (CVX) - Chevron is a major player in the integrated oil and gas sector, covering the entire hydrocarbon value chain; its profitability potential remains robust despite the push for renewable energy [37] Group 8: LTC Properties (LTC) - LTC Properties operates as a REIT focused on senior housing and healthcare properties, which is a perpetually relevant sector due to the aging population [39] - The company offers a forward yield of 6.78% and pays out monthly, making it appealing for income-focused investors [26]

Core Insights - Freedom Holdings, Inc. has engaged Olayinka Oyebola & CO Chartered Accountants for auditing financial statements as required by PCAOB [1] - The Securities Exchange Commission has taken administrative action against BF Borger CPA PC, necessitating Freedom Holdings to retain a new audit firm and reauditing the fiscal year 2023 [2] - The company is working towards gaining QB status on the OTC Markets board and is actively pursuing its business plan focused on growth in the cannabis industry [4][5] Audit and Compliance - The company has filed an 8K to reflect the change in audit firms due to the SEC's action against BF Borger CPA PC [2] - FINRA processed a Form 211 for Freedom Holdings, allowing for the initiation of priced quotations, although this does not imply approval of the security or issuer [3] Business Strategy - Freedom Holdings is negotiating potential mergers with several companies in the cannabis industry to enhance shareholder value through organic and acquisitional growth [4] - The CEO expressed gratitude to Glendale Securities for their support during the 15c211 application process, indicating a commitment to aggressively pursue the company's business plan, including cannabis product extraction and manufacturing [5]

About this content About Angela Harmantas Angela Harmantas is an Editor at Proactive. She has over 15 years of experience covering the equity markets in North America, with a particular focus on junior resource stocks. Angela has reported from numerous countries around the world, including Canada, the US, Australia, Brazil, Ghana, and South Africa for leading trade publications. Previously, she worked in investor relations and led the foreign direct investment program in Canada for the Swedish government ...

PART I — FINANCIAL INFORMATION [Item 1. Unaudited Condensed Consolidated Financial Statements](index=3&type=section&id=Item%201.%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) This section presents Freedom Holding Corp.'s unaudited condensed consolidated financial statements and detailed notes for the periods ended December 31, 2023, and March 31, 2023 [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20as%20of%20December%2031%2C%202023%2C%20and%20March%2031%2C%202023) This section provides a snapshot of the company's financial position, detailing assets, liabilities, and shareholders' equity Condensed Consolidated Balance Sheets (Amounts in thousands of USD) | Metric | Dec 31, 2023 | Mar 31, 2023 | |:---|:---|:---| | **ASSETS** ||| | Cash and cash equivalents | $561,883 | $581,417 | | Restricted cash | $384,553 | $445,528 | | Trading securities | $3,680,453 | $2,412,556 | | Available-for-sale securities | $202,497 | $239,053 | | Margin lending, brokerage and other receivables, net | $961,392 | $376,329 | | Loans issued | $1,346,005 | $826,258 | | Fixed assets, net | $78,099 | $54,017 | | Intangible assets, net | $46,771 | $17,615 | | Goodwill | $52,238 | $14,192 | | Right-of-use asset | $34,180 | $30,345 | | Insurance contract assets | $12,728 | $13,785 | | Other assets, net | $88,244 | $73,463 | | **TOTAL ASSETS** | **$7,449,043** | **$5,084,558** | | **LIABILITIES AND SHAREHOLDERS' EQUITY** ||| | Securities repurchase agreement obligations | $2,889,173 | $1,517,416 | | Customer liabilities | $2,248,042 | $1,925,247 | | Margin lending and trade payables | $145,804 | $122,900 | | Liabilities from insurance activity | $242,179 | $182,502 | | Current income tax liability | $27,711 | $4,547 | | Debt securities issued | $266,310 | $60,025 | | Lease liability | $34,614 | $30,320 | | Liability arising from continuing involvement | $494,513 | $440,805 | | Other liabilities | $61,447 | $30,060 | | **TOTAL LIABILITIES** | **$6,409,793** | **$4,313,822** | | **TOTAL SHAREHOLDERS' EQUITY** | **$1,039,250** | **$770,736** | | **TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY** | **$7,449,043** | **$5,084,558** | - Total assets increased by approximately **$2.36 billion (46.39%)** from March 31, 2023, to December 31, 2023, primarily driven by increases in trading securities, margin lending, brokerage and other receivables, and loans issued[9](index=9&type=chunk) - Total liabilities increased by approximately **$2.10 billion (48.60%)** over the same period, mainly due to a significant rise in securities repurchase agreement obligations and customer liabilities[9](index=9&type=chunk) - Total shareholders' equity increased by approximately **$268.5 million (34.84%)** from March 31, 2023, to December 31, 2023[9](index=9&type=chunk) [Condensed Consolidated Statements of Operations and Statements of Other Comprehensive Income](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Statements%20of%20Other%20Comprehensive%20Income%20for%20the%20Three%20and%20Nine%20Months%20Ended%20December%2031%2C%202023%20and%202022) This section presents the company's financial performance, including revenues, expenses, net income, and other comprehensive income Condensed Consolidated Statements of Operations (Amounts in thousands of USD) | Metric | 3 Months Ended Dec 31, 2023 | 3 Months Ended Dec 31, 2022 | 9 Months Ended Dec 31, 2023 | 9 Months Ended Dec 31, 2022 | |:---|:---|:---|:---|:---|\n| **Revenue:** ||||| | Fee and commission income | $120,159 | $80,883 | $330,565 | $253,486 | | Net (loss)/gain on trading securities | $(5,089) | $25,456 | $77,498 | $38,894 | | Interest income | $226,445 | $80,255 | $588,857 | $187,817 | | Insurance underwriting income | $79,017 | $28,557 | $181,882 | $78,998 | | Net gain on foreign exchange operations | $38,825 | $20,866 | $54,430 | $30,014 | | Net loss on derivative | $(42,568) | $(21,469) | $(71,795) | $(22,523) | | Other income/(expense) | $1,845 | $(570) | $8,988 | $(79) | | **TOTAL REVENUE, NET** | **$418,634** | **$213,978** | **$1,170,425** | **$566,607** | | **Expense:** ||||| | Fee and commission expense | $42,818 | $18,314 | $103,116 | $60,068 | | Interest expense | $131,223 | $52,037 | $365,650 | $132,971 | | Insurance claims incurred, net of reinsurance | $40,989 | $17,419 | $96,491 | $51,586 | | Payroll and bonuses | $45,083 | $21,610 | $116,711 | $55,252 | | Professional services | $6,217 | $5,901 | $24,793 | $14,174 | | Stock compensation expense | $1,039 | $2,939 | $3,303 | $6,519 | | Advertising expense | $11,066 | $3,730 | $27,805 | $9,479 | | General and administrative expense | $32,106 | $16,428 | $86,211 | $40,943 | | (Recovery)/Allowance for expected credit losses | $(3,526) | $24,140 | $15,462 | $30,294 | | **TOTAL EXPENSE** | **$307,015** | **$162,518** | **$839,542** | **$401,286** | | **INCOME BEFORE INCOME TAX** | **$111,619** | **$51,460** | **$330,883** | **$165,321** | | Income tax expense | $(15,544) | $(5,069) | $(51,408) | $(26,567) | | **NET INCOME** | **$96,075** | **$62,400** | **$279,475** | **$148,683** | | **NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS** | **$96,368** | **$62,864** | **$280,317** | **$150,191** | Earnings Per Common Share (USD) | Metric | 3 Months Ended Dec 31, 2023 | 3 Months Ended Dec 31, 2022 | 9 Months Ended Dec 31, 2023 | 9 Months Ended Dec 31, 2022 | |:---|:---|:---|:---|:---|\n| Earnings from continuing operations per common share - basic | $1.65 | $0.79 | $4.79 | $2.37 | | Earnings from continuing operations per common share - diluted | $1.63 | $0.78 | $4.73 | $2.33 | | Earnings per common share - basic (Restated) | $1.65 | $1.06 | $4.79 | $2.54 | | Earnings per common share - diluted (Restated) | $1.63 | $1.05 | $4.73 | $2.50 | - Total revenue, net, for the three months ended December 31, 2023, increased by **96% to $418.6 million**, primarily driven by a **182% increase in interest income** and a **177% increase in insurance underwriting income**[10](index=10&type=chunk)[385](index=385&type=chunk) - Net income for the three months ended December 31, 2023, rose by **54% to $96.1 million**, while diluted EPS from continuing operations increased from **$0.78 to $1.63**[11](index=11&type=chunk)[416](index=416&type=chunk) - For the nine months ended December 31, 2023, total revenue, net, increased by **107% to $1.17 billion**, with interest income growing by **214%** and insurance underwriting income by **130%**[10](index=10&type=chunk)[423](index=423&type=chunk) - Net income for the nine months ended December 31, 2023, increased by **88% to $279.5 million**, and diluted EPS from continuing operations grew from **$2.33 to $4.73**[11](index=11&type=chunk)[454](index=454&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20for%20the%20Nine%20Months%20Ended%20December%2031%2C%202023%20and%202022) This section details the company's cash inflows and outflows from operating, investing, and financing activities Condensed Consolidated Statements of Cash Flows (Amounts in thousands of USD) | Metric | 9 Months Ended Dec 31, 2023 | 9 Months Ended Dec 31, 2022 | |:---|:---|:---|\n| Net cash flows used in operating activities | $(1,373,355) | $(465,791) | | Net cash flows used in investing activities | $(593,033) | $(641,321) | | Net cash flows from financing activities | $1,892,328 | $1,506,188 | | Effect of changes in foreign exchange rates on cash and cash equivalents | $(6,449) | $85,064 | | **NET CHANGE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH** | **$(80,509)** | **$484,140** | | Cash, cash equivalents and restricted cash, beginning of period | $1,026,945 | $1,230,300 | | Cash, cash equivalents and restricted cash, end of period | $946,436 | $1,714,440 | - Net cash used in operating activities significantly increased to **$1.37 billion** for the nine months ended December 31, 2023, from **$465.8 million** in the prior year, primarily due to increased purchases of trading securities and margin lending receivables[15](index=15&type=chunk)[476](index=476&type=chunk)[477](index=477&type=chunk) - Net cash used in investing activities decreased to **$593.0 million**, from **$641.3 million**, mainly due to proceeds from the sale of available-for-sale securities partially offsetting cash used for loan issuance and acquisitions[15](index=15&type=chunk)[478](index=478&type=chunk) - Net cash from financing activities increased to **$1.89 billion**, from **$1.51 billion**, driven by proceeds from securities repurchase agreements and debt securities issued[15](index=15&type=chunk)[479](index=479&type=chunk) [Condensed Consolidated Statements of Shareholders' Equity](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Shareholders%27%20Equity%20for%20the%20Three%20and%20Nine%20Months%20Ended%20December%2031%2C%202023%20and%202022) This section outlines changes in the company's equity, including net income, stock compensation, and foreign currency adjustments Condensed Consolidated Statements of Shareholders' Equity (Amounts in thousands of USD) | Metric | At Sep 30, 2023 | Stock based compensation | Foreign currency translation adjustments, net of tax effect | Other comprehensive loss | Net income/(loss) | At Dec 31, 2023 | |:---|:---|:---|:---|:---|:---|:---|\n| Common Stock | $59 | — | — | — | — | $59 | | Additional paid in capital | $166,426 | $1,039 | — | — | — | $167,465 | | Retained earnings | $807,149 | — | — | — | $96,368 | $903,517 | | Accumulated other comprehensive loss | $(62,550) | — | $28,100 | $(395) | — | $(34,845) | | Total equity attributable to shareholders' | $911,084 | $1,039 | $28,100 | $(395) | $96,368 | $1,036,196 | | Non-controlling interest | $3,347 | — | — | — | $(293) | $3,054 | | **Total** | **$914,431** | **$1,039** | **$28,100** | **$(395)** | **$96,075** | **$1,039,250** | - Total shareholders' equity increased from **$914.4 million** at September 30, 2023, to **$1.04 billion** at December 31, 2023, primarily due to net income of **$96.1 million** and foreign currency translation adjustments of **$28.1 million**[18](index=18&type=chunk) - The company recognized **$1.04 million** in stock-based compensation during the three months ended December 31, 2023[18](index=18&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=14&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations and disclosures supporting the condensed consolidated financial statements [NOTE 1 – DESCRIPTION OF BUSINESS](index=12&type=section&id=NOTE%201%20%E2%80%93%20DESCRIPTION%20OF%20BUSINESS) This note describes Freedom Holding Corp.'s business, financial services, and global operational footprint - Freedom Holding Corp. (FRHC) is a US-organized corporation providing financial services including retail securities brokerage, investment banking, commercial banking, and insurance products through its subsidiaries, operating across multiple countries[20](index=20&type=chunk) - As of December 31, 2023, FRHC owned various subsidiaries across these jurisdictions, covering diverse business areas from securities broker-dealer to online ticket sales and telecommunications[22](index=22&type=chunk) - The Company holds a **9% interest** in Freedom Finance Ukraine LLC (Freedom UA) but does not maintain effective control as of December 31, 2023, due to its inclusion on a Ukrainian sanctions list and asset freeze[23](index=23&type=chunk)[24](index=24&type=chunk) [NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES](index=14&type=section&id=NOTE%202%20%E2%80%93%20SUMMARY%20OF%20SIGNIFICANT%20ACCOUNTING%20POLICIES) This note outlines the key accounting principles and policies applied in preparing the financial statements [Accounting Principles and Consolidation](index=14&type=section&id=Accounting%20principles) This section details the accounting principles and consolidation policies, including the treatment of subsidiaries and equity interests - The Company's financial statements conform to U.S. GAAP and present the consolidated accounts of FRHC and its subsidiaries, with all inter-company balances and transactions eliminated[26](index=26&type=chunk)[27](index=27&type=chunk) - Effective April 1, 2023, the Company removed its equity interest in Freedom UA from its consolidated financial statements due to a loss of effective control following its inclusion on a Ukrainian sanctions list[31](index=31&type=chunk) - Freedom Securities Trading Inc. (FST Belize), solely owned by Timur Turlov, is not consolidated as it is not a Variable Interest Entity (VIE) and Mr. Turlov maintains controlling interest under the Voting Interest Entity (VOE) model[32](index=32&type=chunk)[33](index=33&type=chunk) [Revenue and Expense Recognition](index=16&type=section&id=Revenue%20and%20expense%20recognition) This section explains the company's policies for recognizing various types of revenue and expenses - Revenue from contracts with customers is recognized when performance obligations are satisfied, primarily at a point in time for brokerage, banking, payment processing, and investment banking services[36](index=36&type=chunk)[219](index=219&type=chunk)[220](index=220&type=chunk) - Interest income from margin loans, trading securities, and other financial instruments is recognized based on contractual provisions, with loan premiums and discounts amortized into interest income using the effective interest method[39](index=39&type=chunk)[40](index=40&type=chunk)[41](index=41&type=chunk) - The Group distinguishes between principal and agent roles for revenue recognition, reporting gross revenue when acting as a principal and net fees/commissions when acting as an agent[37](index=37&type=chunk)[38](index=38&type=chunk) [Loans and Credit Loss Allowance](index=17&type=section&id=Loans) This section describes the company's loan portfolio and the methodology for calculating the allowance for credit losses - The loan portfolio includes mortgages, uncollateralized and collateralized bank customer loans, car loans, loans to policyholders, and purchased retail loans, with loans written off when recovery efforts cease[42](index=42&type=chunk)[43](index=43&type=chunk) - Effective April 1, 2023, the Group adopted the CECL methodology, requiring an allowance for lifetime expected credit losses for loans, based on past events, current conditions, and reasonable forecasts[47](index=47&type=chunk)[48](index=48&type=chunk) - The Allowance for Credit Losses (ACL) has collective and individual components, with collective assessments using PD/LGD methodology based on delinquency trends and macroeconomic indicators, and individual assessments for loans lacking common risk characteristics[49](index=49&type=chunk)[51](index=51&type=chunk)[58](index=58&type=chunk) [Derivative Financial Instruments](index=20&type=section&id=Derivative%20financial%20instruments) This section outlines the accounting treatment for derivative financial instruments, including fair value measurement - Derivatives are initially recognized at fair value and subsequently re-measured at fair value at each reporting date, with gains or losses recognized in the Consolidated Statements of Operations and Statements of Other Comprehensive Income[68](index=68&type=chunk) [Functional and Reporting Currency](index=20&type=section&id=Functional%20currency) This section specifies the functional currencies of the company's operations and its U.S. dollar reporting currency - The Company's functional currencies include Kazakhstan tenge, euro, U.S. dollar, Uzbekistani som, Kyrgyzstani som, Azerbaijani manat, British pound sterling, Armenian dram, UAE dirham, and Turkish lira, with the U.S. dollar as the reporting currency[69](index=69&type=chunk) - Monetary assets and liabilities in foreign currencies are translated at balance sheet date exchange rates, while non-monetary items are translated at transaction date rates, with translation adjustments recorded in 'Accumulated other comprehensive loss'[69](index=69&type=chunk) [Cash and Cash Equivalents](index=20&type=section&id=Cash%20and%20cash%20equivalents) This section defines cash and cash equivalents and their components, including highly liquid investments - Cash and cash equivalents include highly liquid investments with original maturities of three months or less, such as reverse repurchase agreements with low counterparty credit risk, recorded at acquisition cost plus accrued interest[70](index=70&type=chunk) [Securities Reverse Repurchase and Repurchase Agreements](index=20&type=section&id=Securities%20reverse%20repurchase%20and%20repurchase%20agreements) This section explains the accounting for securities reverse repurchase and repurchase agreements as collateralized financing - Reverse repurchase agreements are treated as collateralized financing transactions, with purchased financial instruments recorded as cash placed on deposit collateralized by securities[71](index=71&type=chunk) - Repurchase agreements are also collateralized financing transactions, where the Group retains the sold financial instruments (classified as trading securities) and the consideration received is recorded as securities repurchase agreement obligations[72](index=72&type=chunk)[73](index=73&type=chunk) [Restricted Cash](index=21&type=section&id=Restricted%20cash) This section details the nature and purpose of restricted cash, including segregated customer funds - Restricted cash comprises funds held for specific reasons, such as segregated customer cash and guaranty deposits, which are not available for immediate use and are restricted for more than three months[75](index=75&type=chunk) [Available-for-Sale Securities](index=21&type=section&id=Available-for-sale%20securities) This section describes the classification and accounting for available-for-sale securities - Available-for-sale (AFS) securities are non-derivatives not classified as loans, held-to-maturity, or trading securities, with gains and losses from fair value changes recognized in other comprehensive income, except for specific items[76](index=76&type=chunk)[77](index=77&type=chunk) [Trading Securities](index=21&type=section&id=Trading%20securities) This section outlines the accounting for trading securities, held for near-term sale at fair value - Trading securities are financial assets acquired primarily for near-term sale, stated at fair value, with gains or losses recognized in revenue[78](index=78&type=chunk)[79](index=79&type=chunk) - Investments in nonconsolidated managed funds are accounted for at fair value based on net asset value, with gains or losses included in net gain/(loss) on trading securities[80](index=80&type=chunk) [Debt Securities Issued](index=21&type=section&id=Debt%20securities%20issued) This section explains the recognition and measurement of debt securities issued by the company - Debt securities issued are initially recognized at fair value less transaction costs, then stated at amortized cost, with any difference between net proceeds and redemption value recognized over the borrowing period using the effective interest method[81](index=81&type=chunk) [Margin Lending, Brokerage and Other Receivables](index=22&type=section&id=Margin%20lending%2C%20brokerage%20and%20other%20receivables) This section details the accounting for margin lending, brokerage, and other receivables, net of credit losses - Margin lending, brokerage, and other receivables are initially recognized at fair value and subsequently carried at cost, net of any allowance for credit losses[83](index=83&type=chunk) - These receivables arise from securities financing transactions with clients, where the Group is permitted to sell or repledge securities received as collateral[82](index=82&type=chunk) [Derecognition of Financial Assets](index=22&type=section&id=Derecognition%20of%20financial%20assets) This section describes the criteria for derecognizing financial assets from the balance sheet - Financial assets are derecognized when they are isolated from the Group, the transferee has rights to pledge or exchange them, and the Group does not maintain effective control over the transferred assets[86](index=86&type=chunk) [Impairment of Long-Lived Assets](index=22&type=section&id=Impairment%20of%20long-lived%20assets) This section outlines the company's policy for evaluating and recognizing impairment of long-lived assets - The Group periodically evaluates long-lived assets for impairment when events or circumstances warrant, recognizing a loss if the fair value is less than the carrying value[87](index=87&type=chunk) [Impairment of Goodwill](index=23&type=section&id=Impairment%20of%20goodwill) This section details the allocation and annual impairment testing of goodwill across reporting units - Goodwill is allocated to reporting units (Central Asia and Eastern Europe, Europe Excluding Eastern Europe, US, Middle East/Caucasus) and tested for impairment annually or when indicators arise[88](index=88&type=chunk)[89](index=89&type=chunk)[90](index=90&type=chunk)[91](index=91&type=chunk)[92](index=92&type=chunk)[94](index=94&type=chunk) - As of December 31, 2023, goodwill totaled **$52.2 million**, an increase from **$14.2 million** at March 31, 2023, primarily due to acquisitions and foreign exchange translation[96](index=96&type=chunk)[97](index=97&type=chunk) Goodwill Carrying Amount by Reporting Unit (Amounts in thousands of USD) | Metric | Central Asia and Eastern Europe | Europe excluding Eastern Europe | US | Middle East/Caucasus | Total | |:---|:---|:---|:---|:---|:---|\n| Balance as of March 31, 2023 | $7,624 | $0 | $7,400 | $0 | $15,024 | | Write-off due to deconsolidation of Freedom UA | $(832) | $0 | $0 | $0 | $(832) | | Foreign currency translation difference | $89 | $0 | $0 | $0 | $89 | | Acquired | $37,957 | $0 | $0 | $0 | $37,957 | | **Balance as of December 31, 2023** | **$44,838** | **$0** | **$7,400** | **$0** | **$52,238** | [Business Combinations and Acquisitions](index=24&type=section&id=Business%20combinations%20and%20acquisitions) This section explains the accounting methods for business combinations, including acquisition and pooling of interests - Acquisitions of businesses not under common control are accounted for using the acquisition method, measuring consideration transferred and assets/liabilities acquired at fair value[99](index=99&type=chunk) - Business combinations under common control are accounted for using the pooling of interests method, combining financial statements as if entities were combined from the beginning of common control[100](index=100&type=chunk)[101](index=101&type=chunk) [Income Taxes](index=25&type=section&id=Income%20taxes) This section describes the accounting for income taxes, including deferred taxes and uncertain tax positions - Deferred tax liabilities and assets are recognized based on temporary differences between financial statements and tax bases, using enacted tax rates[102](index=102&type=chunk)[103](index=103&type=chunk) - Uncertain tax positions are recorded based on a two-step process: determining if positions will be sustained and recognizing the largest likely benefit[104](index=104&type=chunk) - The Group had no accrued interest or fines related to uncertain tax positions as of December 31, 2023, and March 31, 2023[105](index=105&type=chunk) [Fair Value Measurement](index=25&type=section&id=Fair%20Value) This section defines fair value and the three-level hierarchy used for fair value measurements - Fair value is the price to sell an asset or transfer a liability in an orderly transaction between market participants, based on the principal or most advantageous market[107](index=107&type=chunk) - Fair value measurements are classified into a three-level hierarchy based on the transparency of inputs: Level 1 (quoted prices in active markets), Level 2 (observable inputs), and Level 3 (unobservable inputs)[171](index=171&type=chunk) [Leases](index=25&type=section&id=Leases) This section outlines the company's accounting for leases, including recognition of ROU assets and lease liabilities - The Group applies ASU No. 2016-02, 'Leases (Topic 842)', electing not to recognize leases with terms of one year or less on the balance sheet[108](index=108&type=chunk) - Operating lease liabilities and Right-of-Use (ROU) assets are recognized at lease commencement based on the present value of future minimum lease payments, discounted at the Company's collateralized borrowing rate[259](index=259&type=chunk) [Fixed Assets](index=26&type=section&id=Fixed%20assets) This section details the accounting for fixed assets, including cost, depreciation, and useful lives - Fixed assets are carried at cost, net of accumulated depreciation, which is computed using the straight-line method over estimated useful lives ranging from three to sixty-five years[109](index=109&type=chunk) [Insurance Contract Assets and Liabilities](index=26&type=section&id=Insurance%20contract%20assets%20and%20liabilities) This section describes the accounting for insurance contract assets and liabilities, including reserves and deferred acquisition costs - Insurance and reinsurance receivables are recognized at fair value upon earning income, then measured at cost net of impairment losses[110](index=110&type=chunk) - Deferred acquisition costs (DAC) are capitalized and amortized over the estimated premium-paying period for life/long-duration health insurance or the effective period for property/casualty/short-duration health insurance[111](index=111&type=chunk) - Payables on insurance business include advances received, amounts payable to insured (claims and premium refunds), and amounts payable to agents and brokers, accounted for at amortized cost[112](index=112&type=chunk)[113](index=113&type=chunk) - Unearned premium reserve is determined proportionally for each contract, and claims are expensed as incurred, with insurance loss reserves including claims reported but not settled (RBNS) and incurred but not reported (IBNR), estimated using actuarial methods[114](index=114&type=chunk)[115](index=115&type=chunk)[117](index=117&type=chunk)[120](index=120&type=chunk) [Segment Information](index=28&type=section&id=Segment%20information) This section provides details on the company's reportable segments and the criteria for their determination - The Company identifies four reportable segments: Central Asia and Eastern Europe, Europe Excluding Eastern Europe, United States, and Middle East/Caucasus, based on management's evaluation of operations and internal financial reporting[125](index=125&type=chunk)[126](index=126&type=chunk)[127](index=127&type=chunk)[132](index=132&type=chunk) - Segments are determined by quantitative thresholds (10% of combined revenue or profit/loss) and qualitative factors, such as distinct products, services, geographical locations, economic factors, and regular review by the Chief Operating Decision Maker (CODM)[126](index=126&type=chunk)[128](index=128&type=chunk)[129](index=129&type=chunk)[130](index=130&type=chunk)[131](index=131&type=chunk) [Recent Accounting Pronouncements](index=28&type=section&id=Recent%20accounting%20pronouncements) This section discusses the adoption and evaluation of recent accounting standards updates - The Company adopted ASC 326, 'Financial Instruments-Credit Losses (CECL)', effective April 1, 2023, using a modified retrospective approach, which significantly changed the estimation and recognition of credit losses[133](index=133&type=chunk) Impact of ASC 326 Adoption on Allowance for Credit Losses and Retained Earnings (Amounts in thousands of USD) | Metric | March 31, 2023 | ASC 326 Adoption Impact | April 1, 2023 | |:---|:---|:---|:---|\n| Allowance for credit losses for loans | $2,792 | $25,444 | $28,236 | | Decrease to retained earnings, net of tax effect | | $22,772 | | - The Company is currently evaluating the impact of several other ASUs, including ASU 2023-05 (Joint Venture Formations), ASU 2023-06 (Disclosure Improvements), ASU 2023-08 (Crypto Assets), and ASU 2023-09 (Income Taxes), which are effective in future fiscal years[150](index=150&type=chunk)[154](index=154&type=chunk)[157](index=157&type=chunk)[158](index=158&type=chunk) [Restatement](index=34&type=section&id=Restatement) This section explains the restatement of prior period financial results due to identified errors - A restatement was necessary for the three and nine months ended December 31, 2022, due to a mathematical error in the calculation of earnings per common share for both continuing and discontinued operations[159](index=159&type=chunk)[160](index=160&type=chunk) Impact of Restatement on Earnings Per Common Share (USD) | Metric | As previously reported | Correction of error | As restated | |:---|:---|:---|:---|\n| **Three months ended December 31, 2022** |||| | Earnings from discontinued operations per common share - basic | $0.59 | $(0.32) | $0.27 | | Earnings from discontinued operations per common share - diluted | $0.58 | $(0.31) | $0.27 | | Earnings per common share - basic | $1.38 | $(0.32) | $1.06 | | Earnings per common share - diluted | $1.36 | $(0.31) | $1.05 | | **Nine months ended December 31, 2022** |||| | Earnings from discontinued operations per common share - basic | $0.49 | $(0.32) | $0.17 | | Earnings from discontinued operations per common share - diluted | $0.48 | $(0.31) | $0.17 | | Earnings per common share - basic | $2.86 | $(0.32) | $2.54 | | Earnings per common share - diluted | $2.81 | $(0.31) | $2.50 | [NOTE 3 – CASH AND CASH EQUIVALENTS](index=35&type=section&id=NOTE%203%20%E2%80%93%20CASH%20AND%20CASH%20EQUIVALENTS) This note provides a detailed breakdown of the company's cash and cash equivalents components Cash and Cash Equivalents (Amounts in thousands of USD) | Component | Dec 31, 2023 | Mar 31, 2023 | |:---|:---|:---|\n| Short term deposits in National Bank (Kazakhstan) | $237,145 | $357,454 | | Short term deposits in commercial banks | $129,915 | $83,755 | | Securities purchased under reverse repurchase agreements | $107,262 | $29,812 | | Petty cash in bank vault and on hand | $49,717 | $35,998 | | Short term deposits in stock exchanges | $34,696 | $31,691 | | Short term deposits on brokerage accounts | $2,793 | $37,417 | | Overnight deposits | $429 | $1,926 | | Cash in transit | $219 | $3,364 | | Short term deposits in the Central Depository (Kazakhstan) | $54 | $0 | | Allowance for Cash and cash equivalents | $(347) | $0 | | **Total cash and cash equivalents** | **$561,883** | **$581,417** | - Cash and cash equivalents decreased slightly from **$581.4 million to $561.9 million** between March 31, 2023, and December 31, 2023[163](index=163&type=chunk) - Securities purchased under reverse repurchase agreements significantly increased from **$29.8 million to $107.3 million**, with an average interest rate of **9.77%** for non-US sovereign debt and **16.32%** for corporate equity as of December 31, 2023[163](index=163&type=chunk)[164](index=164&type=chunk) [NOTE 4 – RESTRICTED CASH](index=36&type=section&id=NOTE%204%20%E2%80%93%20RESTRICTED%20CASH) This note details the components and purpose of restricted cash, including segregated customer funds Restricted Cash (Amounts in thousands of USD) | Component | Dec 31, 2023 | Mar 31, 2023 | |:---|:---|:---|\n| Brokerage customers' cash | $280,404 | $328,435 | | Guaranty deposits | $104,838 | $116,628 | | Restricted bank accounts | $8,013 | $10,436 | | Deferred distribution payments | $23 | $23 | | Allowance for restricted cash | $(8,725) | $(9,994) | | **Total restricted cash** | **$384,553** | **$445,528** | - Total restricted cash decreased from **$445.5 million** at March 31, 2023, to **$384.6 million** at December 31, 2023, primarily due to a decrease in brokerage customers' cash[166](index=166&type=chunk) - A portion of restricted cash is segregated in special custody accounts for the exclusive benefit of brokerage customers, as mandated by regulations[166](index=166&type=chunk) [NOTE 5 – TRADING AND AVAILABLE-FOR-SALE SECURITIES AT FAIR VALUE](index=37&type=section&id=NOTE%205%20%E2%80%93%20TRADING%20AND%20AVAILABLE-FOR-SALE%20SECURITIES%20AT%20FAIR%20VALUE) This note provides a breakdown of trading and available-for-sale securities measured at fair value Trading and Available-for-Sale Securities at Fair Value (Amounts in thousands of USD) | Security Type | Dec 31, 2023 | Mar 31, 2023 | |:---|:---|:---|\n| **Trading Securities** ||| | Non-U.S. sovereign debt | $2,370,508 | $1,029,857 | | Corporate debt | $1,165,732 | $1,269,879 | | Corporate equity | $99,589 | $65,741 | | U.S. sovereign debt | $43,231 | $45,022 | | Exchange traded notes | $1,393 | $2,057 | | **Total trading securities** | **$3,680,453** | **$2,412,556** | | **Available-for-Sale Securities** ||| | Corporate debt | $127,402 | $191,082 | | Non-U.S. sovereign debt | $62,987 | $40,162 | | U.S. sovereign debt | $12,108 | $7,809 | | **Total available-for-sale securities, at fair value** | **$202,497** | **$239,053** | - Total trading securities increased significantly by **52.56% to $3.68 billion** at December 31, 2023, primarily driven by a substantial increase in non-U.S. sovereign debt holdings[167](index=167&type=chunk) - Available-for-sale securities decreased by **15.25% to $202.5 million**, mainly due to a reduction in corporate debt holdings[167](index=167&type=chunk) Fair Value Measurements as of December 31, 2023 (Amounts in thousands of USD) | Security Type | Total | Level 1 | Level 2 | Level 3 | |:---|:---|:---|:---|:---|\n| **Trading Securities** ||||| | Non-U.S. sovereign debt | $2,370,508 | $1,443,144 | $927,330 | $34 | | Corporate debt | $1,165,732 | $397,767 | $751,490 | $16,475 | | Corporate equity | $99,589 | $77,577 | $1,603 | $20,409 | | U.S. sovereign debt | $43,231 | $43,231 | $0 | $0 | | Exchange traded notes | $1,393 | $908 | $485 | $0 | | **Total trading securities** | **$3,680,453** | **$1,962,627** | **$1,680,908** | **$36,918** | | **Available-for-Sale Securities** ||||| | Corporate debt | $127,402 | $40,645 | $86,757 | $0 | | Non-US sovereign debt | $62,987 | $50,557 | $12,430 | $0 | | US sovereign debt | $12,108 | $12,108 | $0 | $0 | | **Total available-for-sale securities, at fair value** | **$202,497** | **$103,310** | **$99,187** | **$0** | - The Group held significant concentrations in debt securities from the Ministry of Finance of the Republic of Kazakhstan (**$2.36 billion**) and Kazakhstan Sustainability Fund JSC (**$721.1 million**) as of December 31, 2023, both exceeding **10% of total trading securities**[167](index=167&type=chunk)[168](index=168&type=chunk) [NOTE 6 – MARGIN LENDING, BROKERAGE AND OTHER RECEIVABLES, NET](index=42&type=section&id=NOTE%206%20%E2%80%93%20MARGIN%20LENDING%2C%20BROKERAGE%20AND%20OTHER%20RECEIVABLES%2C%20NET) This note details the components of margin lending, brokerage, and other receivables, net of allowances Margin Lending, Brokerage and Other Receivables, Net (Amounts in thousands of USD) | Component | Dec 31, 2023 | Mar 31, 2023 | |:---|:---|:---|\n| Margin lending receivables | $941,456 | $361,684 | | Bank commissions receivable | $8,385 | $6,035 | | Receivables from payment processing services | $7,291 | $1,158 | | Receivables from brokerage clients | $2,946 | $7,302 | | Receivable for underwriting and market-making services | $539 | $2,317 | | Other receivables | $12,701 | $10,340 | | Allowance for receivables | $(11,926) | $(12,507) | | **Total margin lending, brokerage and other receivables, net** | **$961,392** | **$376,329** | - Total margin lending, brokerage and other receivables, net, increased significantly by **155.47% to $961.4 million** at December 31, 2023, primarily driven by a substantial increase in margin lending receivables[180](index=180&type=chunk) - The fair value of collateral received under margin loans increased from **$1.42 billion to $6.68 billion**, with **$2.8 billion (42%)** from a single counterparty[181](index=181&type=chunk) - Receivables from FST Belize, a related party, decreased from **$290.2 million (78% of total) to $27.2 million (3% of total)**, reflecting efforts to reduce related-party transactions[182](index=182&type=chunk) [NOTE 7 – LOANS ISSUED](index=43&type=section&id=NOTE%207%20%E2%80%93%20LOANS%20ISSUED) This note provides a breakdown of the company's loan portfolio and the associated allowance for credit losses Loans Issued as of December 31, 2023 (Amounts in thousands of USD) | Loan Type | Amount Outstanding | Weighted Average Interest Rate | Fair Value of Collateral | |:---|:---|:---|:---|\n| Mortgage loans | $693,167 | 10.30% | $692,016 | | Car loans | $274,980 | 23.70% | $264,953 | | Uncollateralized bank customer loans | $243,029 | 27.10% | — | | Right of claim for purchased retail loans | $142,970 | 15.00% | $142,970 | | Collateralized bank customer loans | $21,104 | 20.97% | $20,748 | | Subordinated loan | $5,038 | 3.00% | — | | Other | $12,391 | 9.10%/3%/16%/2.4% | $24 | | Allowance for loans issued | $(46,674) | | | | **Total loans issued** | **$1,346,005** | | | - Total loans issued increased from **$826.3 million** at March 31, 2023, to **$1.35 billion** at December 31, 2023, with mortgage loans being the largest component[186](index=186&type=chunk)[191](index=191&type=chunk) - The Group continues to recognize mortgage loans transferred under the state program '7-20-25' due to retaining recourse for uncollectible amounts and servicing agreements, with an associated liability of **$494.5 million**[187](index=187&type=chunk) - The allowance for credit losses for loans increased significantly from **$(2.79) million** at March 31, 2023, to **$(46.67) million** at December 31, 2023, reflecting the adoption of ASU 2016-13 (CECL) and charges during the period[201](index=201&type=chunk) [NOTE 8 – PROVISION FOR INCOME TAXES](index=50&type=section&id=NOTE%208%20%E2%80%93%20PROVISION%20FOR%20INCOME%20TAXES) This note details the company's income tax provision, effective tax rates, and deferred tax balances - The Group is subject to taxation in multiple jurisdictions, with deferred tax rates ranging from **9% (UAE) to 31% (Germany)**[203](index=203&type=chunk)[204](index=204&type=chunk) - The effective tax rate for the nine months ended December 31, 2023, was **15.5%**, a slight decrease from **16.1%** in the prior year, influenced by changes in revenue composition and U.S. GILTI tax[205](index=205&type=chunk)[453](index=453&type=chunk) [NOTE 9 – SECURITIES REPURCHASE AGREEMENT OBLIGATIONS](index=50&type=section&id=NOTE%209%20%E2%80%93%20SECURITIES%20REPURCHASE%20AGREEMENT%20OBLIGATIONS) This note outlines the company's obligations under securities repurchase agreements and related collateral Securities Repurchase Agreement Obligations (Amounts in thousands of USD) | Security Type | Dec 31, 2023 | Mar 31, 2023 | |:---|:---|:---|\n| Non-US sovereign debt | $1,924,268 | $881,461 | | Corporate debt | $945,050 | $602,934 | | US sovereign debt | $19,838 | $17,637 | | Corporate equity | $17 | $15,384 | | **Total securities sold under repurchase agreements** | **$2,889,173** | **$1,517,416** | - Securities repurchase agreement obligations increased by **90.4% to $2.89 billion** at December 31, 2023, from **$1.52 billion** at March 31, 2023, primarily driven by non-US sovereign debt[206](index=206&type=chunk) - The fair value of collateral pledged under these agreements increased from **$1.52 billion to $2.90 billion**[206](index=206&type=chunk) - All transactions were executed through the Kazakhstan Stock Exchange, with a weighted average maturity of **11 days** as of December 31, 2023[207](index=207&type=chunk) [NOTE 10 – CUSTOMER LIABILITIES](index=51&type=section&id=NOTE%2010%20%E2%80%93%20CUSTOMER%20LIABILITIES) This note details the components of customer liabilities, including term deposits and brokerage accounts Customer Liabilities (Amounts in thousands of USD) | Type | Dec 31, 2023 Amount | Dec 31, 2023 Interest Rate | Mar 31, 2023 Amount | Mar 31, 2023 Interest Rate | |:---|:---|:---|:---|:---|\n| Term deposits | $1,182,839 | 0.05% - 16.9% | $832,751 | 0.1% - 16.9% | | Brokerage customers (non-interest-bearing) | $693,174 | | $633,542 | | | Current customer accounts (non-interest-bearing) | $372,029 | | $458,954 | | | **Total customer liabilities** | **$2,248,042** | | **$1,925,247** | | - Total customer liabilities increased by **16.77% to $2.25 billion** at December 31, 2023, from **$1.93 billion** at March 31, 2023, primarily due to a rise in interest-bearing term deposits[208](index=208&type=chunk) - Amounts in excess of insured bank time deposits by KDIF totaled **$626.5 million** at December 31, 2023[208](index=208&type=chunk) [NOTE 11 – MARGIN LENDING AND TRADE PAYABLES](index=51&type=section&id=NOTE%2011%20%E2%80%93%20MARGIN%20LENDING%20AND%20TRADE%20PAYABLES) This note provides a breakdown of margin lending and trade payables, including collateral information Margin Lending and Trade Payables (Amounts in thousands of USD) | Component | Dec 31, 2023 | Mar 31, 2023 | |:---|:---|:---|\n| Margin lending payable | $120,034 | $117,144 | | Payables to merchants | $16,152 | $382 | | Payables to suppliers of goods and services | $6,683 | $2,965 | | Trade payable for securities purchased | $479 | $482 | | Other | $2,456 | $1,927 | | **Total margin lending and trade payables** | **$145,804** | **$122,900** | - Total margin lending and trade payables increased by **18.64% to $145.8 million** at December 31, 2023, from **$122.9 million** at March 31, 2023, largely due to a significant increase in payables to merchants[209](index=209&type=chunk) - The fair value of collateral by the Group under margin loans was **$777.6 million** at December 31, 2023, up from **$164.9 million** at March 31, 2023[210](index=210&type=chunk) [NOTE 12 – DEBT SECURITIES ISSUED](index=52&type=section&id=NOTE%2012%20%E2%80%93%20DEBT%20SECURITIES%20ISSUED) This note details the company's debt securities issued, including terms, interest rates, and maturity dates Debt Securities Issued (Amounts in thousands of USD) | Security | Dec 31, 2023 | Mar 31, 2023 | Interest Rate | Maturity Date | |:---|:---|:---|:---|:---|\n| Freedom SPC bonds due 2028 | $200,407 | — | 12% (first 2 years), EFFR + 6.5% (subsequent) | December, 2028 | | Freedom SPC bonds due 2026 | $64,482 | $58,582 | 5.5% | October, 2026 | | Accrued interest | $1,421 | $1,443 | | | | **Total debt securities issued** | **$266,310** | **$60,025** | | | - Total debt securities issued increased significantly to **$266.3 million** at December 31, 2023, from **$60.0 million** at March 31, 2023, primarily due to the issuance of **$200.4 million** in Freedom SPC bonds due 2028[211](index=211&type=chunk)[212](index=212&type=chunk) - The Freedom SPC bonds are denominated in U.S. dollars, listed on the AIX, and guaranteed by FRHC[212](index=212&type=chunk) [NOTE 13 – INSURANCE CONTRACTS ASSETS AND LIABILITIES FROM INSURANCE ACTIVITIES](index=53&type=section&id=NOTE%2013%20%E2%80%93%20INSURANCE%20CONTRACTS%20ASSETS%20AND%20LIABILITIES%20FROM%20INSURANCE%20ACTIVITIES) This note details the company's insurance contract assets and liabilities, including reserves and payables Insurance Contract Assets (Amounts in thousands of USD) | Component | Dec 31, 2023 | Mar 31, 2023 | |:---|:---|:---|\n| Amounts due from policyholders | $7,301 | $9,699 | | Claims receivable from reinsurance | $1,316 | $1,087 | | Amounts due from reinsured | $478 | $555 | | Advances received from agent | $121 | — | | Allowance for estimated uncollectible reinsurance | $(778) | $(1,325) | | Unearned premium reserve, reinsurers' share | $2,282 | $2,379 | | Reserves for claims and claims' adjustment expenses, reinsurers' share | $2,008 | $1,390 | | **Total insurance contract assets** | **$12,728** | **$13,785** | Liabilities from Insurance Activities (Amounts in thousands of USD) | Component | Dec 31, 2023 | Mar 31, 2023 | |:---|:---|:---|\n| Amounts payable to agents and brokers | $3,599 | $2,466 | | Amounts payable to reinsurers | $2,410 | $2,002 | | Amounts payable to insured | $2,114 | $1,807 | | Unearned premium reserve | $46,000 | $43,082 | | Reserves for claims and claims' adjustment expenses | $188,056 | $133,145 | | **Total liabilities from insurance activity** | **$242,179** | **$182,502** | - Total liabilities from insurance activities increased by **32.7% to $242.2 million** at December 31, 2023, from **$182.5 million** at March 31, 2023, primarily due to a significant increase in reserves for claims and claims' adjustment expenses[218](index=218&type=chunk) [NOTE 14 – FEE AND COMMISSION INCOME](index=54&type=section&id=NOTE%2014%20%E2%80%93%20FEE%20AND%20COMMISSION%20INCOME) This note provides a breakdown of fee and commission income by service type and period Fee and Commission Income by Type (Amounts in thousands of USD) | Income Type | 3 Months Ended Dec 31, 2023 | 3 Months Ended Dec 31, 2022 | 9 Months Ended Dec 31, 2023 | 9 Months Ended Dec 31, 2022 | |:---|:---|:---|:---|:---|\n| Brokerage services | $99,813 | $68,532 | $239,608 | $227,476 | | Commission income from payment processing | $8,977 | — | $37,318 | — | | Underwriting and market-making services | $3,344 | $4,778 | $15,085 | $8,008 | | Bank services | $1,331 | $5,507 | $23,480 | $15,100 | | Other fee and commission income | $6,694 | $2,066 | $15,074 | $2,902 | | **Total fee and commission income** | **$120,159** | **$80,883** | **$330,565** | **$253,486** | - Fee and commission income increased by **49% to $120.2 million** for the three months ended December 31, 2023, driven by a **46% increase in brokerage services** and the addition of **$9.0 million** from payment processing[387](index=387&type=chunk)[388](index=388&type=chunk)[389](index=389&type=chunk) - For the nine months ended December 31, 2023, total fee and commission income grew by **30% to $330.6 million**, with significant contributions from new payment processing services (**$37.3 million**) and increased bank services income[425](index=425&type=chunk)[427](index=427&type=chunk) - Brokerage services accounted for **83%** of total fee and commission income for the three months ended December 31, 2023, and **72%** for the nine months ended December 31, 2023[388](index=388&type=chunk)[426](index=426&type=chunk) [NOTE 15 – NET (LOSS)/GAIN ON TRADING SECURITIES](index=58&type=section&id=NOTE%2015%20%E2%80%93%20NET%20(LOSS)%2FGAIN%20ON%20TRADING%20SECURITIES) This note details the net gains and losses from trading securities, distinguishing between realized and unrealized Net (Loss)/Gain on Trading Securities (Amounts in thousands of USD) | Metric | 3 Months Ended Dec 31, 2023 | 3 Months Ended Dec 31, 2022 | 9 Months Ended Dec 31, 2023 | 9 Months Ended Dec 31, 2022 | |:---|:---|:---|:---|:---|\n| Net realized gain/(loss) | $9,353 | $(47,801) | $61,276 | $(26,790) | | Net unrealized (loss)/gain | $(14,442) | $73,257 | $16,222 | $65,684 | | **Net (loss)/gain on trading securities** | **$(5,089)** | **$25,456** | **$77,498** | **$38,894** | - The Company reported a net loss on trading securities of **$5.1 million** for the three months ended December 31, 2023, a significant decrease from a **$25.5 million gain** in the prior year, primarily due to a **$14.4 million unrealized loss** from price declines in Kazakhstan Sustainability Fund JSC debt securities[234](index=234&type=chunk)[390](index=390&type=chunk)[391](index=391&type=chunk) - For the nine months ended December 31, 2023, net gain on trading securities increased by **99% to $77.5 million**, driven by a **$61.3 million realized gain** from Ministry of Finance of Kazakhstan debt securities and a **$16.2 million unrealized gain** due to a decline in the National Bank's base interest rate[234](index=234&type=chunk)[428](index=428&type=chunk)[429](index=429&type=chunk) [NOTE 16 - NET INTEREST INCOME/EXPENSE](index=59&type=section&id=NOTE%2016%20-%20NET%20INTEREST%20INCOME%2FEXPENSE) This note provides a detailed breakdown of interest income and expense components Net Interest Income/Expense (Amounts in thousands of USD) | Metric | 3 Months Ended Dec 31, 2023 | 3 Months Ended Dec 31, 2022 | 9 Months Ended Dec 31, 2023 | 9 Months Ended Dec 31, 2022 | |:---|:---|:---|:---|:---|\n| **Interest Income:** ||||| | Trading securities | $112,860 | $44,760 | $313,739 | $116,922 | | Margin loans to customers | $51,553 | $12,379 | $111,306 | $27,259 | | Loans to customers | $49,529 | $12,327 | $123,730 | $24,158 | | Securities available-for-sale | $7,478 | $6,727 | $25,476 | $13,280 | | Reverse repurchase agreements and amounts due from banks | $5,025 | $4,062 | $12,012 | $6,198 | | Other interest income | — | — | $2,594 | — | | **Total interest income** | **$226,445** | **$80,255** | **$588,857** | **$187,817** | | **Interest Expense:** ||||| | Securities repurchase agreement obligations | $110,778 | $39,958 | $303,242 | $105,466 | | Customer accounts and deposits | $15,653 | $11,149 | $49,120 | $24,780 | | Margin lending payable | $3,211 | — | $9,671 | — | | Debt securities issued | $1,491 | $842 | $3,387 | $2,457 | | Loans received | $36 | $88 | $89 | $268 | | Other interest expense | $54 | — | $141 | — | | **Total interest expense** | **$131,223** | **$52,037** | **$365,650** | **$132,971** | | **Net interest income** | **$95,222** | **$28,218** | **$223,207** | **$54,846** | - Net interest income for the three months ended December 31, 2023, increased by **237.5% to $95.2 million**, driven by a **182% increase in total interest income**, primarily from trading securities, margin loans, and customer loans[236](index=236&type=chunk)[394](index=394&type=chunk) - Total interest expense for the three months increased by **152% to $131.2 million**, mainly due to higher interest on securities repurchase agreements and customer deposits[236](index=236&type=chunk)[406](index=406&type=chunk) - For the nine months ended December 31, 2023, net interest income surged by **306.9% to $223.2 million**, with total interest income increasing by **214%** and total interest expense by **175%**[238](index=238&type=chunk)[432](index=432&type=chunk)[444](index=444&type=chunk) [NOTE 17 - NET LOSS ON DERIVATIVES](index=62&type=section&id=NOTE%2017%20-%20NET%20LOSS%20ON%20DERIVATIVES) This note details the net losses on derivative financial instruments, including realized and unrealized components Net Loss on Derivatives (Amounts in thousands of USD) | Metric | 3 Months Ended Dec 31, 2023 | 3 Months Ended Dec 31, 2022 | 9 Months Ended Dec 31, 2023 | 9 Months Ended Dec 31, 2022 | |:---|:---|:---|:---|:---|\n| Net realized loss on derivatives | $(43,019) | $(21,469) | $(72,681) | $(22,523) | | Net unrealized gain on derivatives | $451 | — | $886 | — | | **Total net loss on derivatives** | **$(42,568)** | **$(21,469)** | **$(71,795)** | **$(22,523)** | - Net loss on derivatives increased by **98% to $42.6 million** for the three months ended December 31, 2023, primarily due to a **$41.8 million realized loss** from negative revaluation of currency swaps by Freedom Bank KZ[239](index=239&type=chunk)[397](index=397&type=chunk) - For the nine months ended December 31, 2023, net loss on derivatives increased by **219% to $71.8 million**, mainly from Freedom Bank KZ's currency swaps to diversify funding sources[239](index=239&type=chunk)[435](index=435&type=chunk) [NOTE 18 – RELATED PARTY TRANSACTIONS](index=63&type=section&id=NOTE%2018%20%E2%80%93%20RELATED%20PARTY%20TRANSACTIONS) This note discloses balances and transactions with related parties, highlighting efforts to reduce such dealings Related Party Balances (Amounts in thousands of USD) | Account Type | Related Party Balances (Dec 31, 2023) | Total Category (Dec 31, 2023) | Related Party Balances (Mar 31, 2023) | Total Category (Mar 31, 2023) | |:---|:---|:---|:---|:---|\n| Cash and cash equivalents | $0 | $561,883 | $35,549 | $581,417 | | Restricted cash | $67,215 | $384,553 | $114,885 | $445,528 | | Trading securities | $16,220 | $3,680,453 | $556 | $2,412,556 | | Margin lending, brokerage and other receivables, net | $43,241 | $961,392 | $295,611 | $376,329 | | Loans issued | $144,289 | $1,346,005 | $121,316 | $826,258 | | Other assets, net | $533 | $88,244 | $16,102 | $73,463 | | Customer liabilities | $112,701 | $2,248,042 | $130,210 | $1,925,247 | | Margin lending and trade payables | $474 | $145,804 | $3,721 | $122,900 | | Other liabilities | $11,783 | $61,447 | $46 | $30,060 | Related Party Transactions (Amounts in thousands of USD) | Transaction Type | Related Party Transactions (3 Months Ended Dec 31, 2023) | Total Category (3 Months Ended Dec 31, 2023) | Related Party Transactions (3 Months Ended Dec 31, 2022) | Total Category (3 Months Ended Dec 31, 2022) | |:---|:---|:---|:---|:---|\n| Fee and commission income | $30,112 | $120,159 | $44,590 | $80,883 | | Interest income | $7,566 | $226,445 | $10,796 | $80,255 | | Net gain on foreign exchange operations | $593 | $38,825 | $0 | $20,866 | | Fee and commission expense | $55 | $42,818 | $2,304 | $18,314 | | Interest expense | $230 | $131,223 | $82 | $52,037 | | General and administrative expenses | $1,502 | $32,106 | $600 | $16,428 | - Related party transactions, primarily with FST Belize (owned by the CEO), decreased significantly as a percentage of total income, with fee and commission income from FST Belize dropping from **54% to 24%** of total fee and commission income for the three months ended December 31, 2023, and from **67% to 19%** for the nine months ended December 31, 2023[246](index=246&type=chunk)[357](index=357&type=chunk) - Margin lending receivables from FST Belize decreased from **$290.2 million to $27.2 million**, reflecting ongoing efforts to reduce the omnibus brokerage arrangement with FST Belize[248](index=248&type=chunk)[359](index=359&type=chunk) [NOTE 19 – STOCKHOLDERS' EQUITY](index=66&type=section&id=NOTE%2019%20%E2%80%93%20STOCKHOLDERS%27%20EQUITY) This note provides details on changes in stockholders' equity, including stock options and grants - No outstanding non-qualified stock options were exercised during the three months ended December 31, 2023 and 2022[251](index=251&type=chunk) - Stock grants were awarded to key employees and a consultant in March and October 2022, with various vesting schedules[252](index=252&type=chunk)[253](index=253&type=chunk)[254](index=254&type=chunk) [NOTE 20 – STOCK BASED COMPENSATION](index=66&type=section&id=NOTE%2020%20%E2%80%93%20STOCK%20BASED%20COMPENSATION) This note details the company's stock-based compensation expense and unrecognized compensation costs - Stock compensation expense decreased by **65% to $1.04 million** for the three months ended December 31, 2023, compared to **$2.94 million** in the prior year, mainly due to the divestiture of Russian subsidiaries and a reduction in upper management employees receiving stock-based compensation[256](index=256&type=chunk)[411](index=411&type=chunk) - As of December 31, 2023, total unrecognized compensation cost related to non-vested shares was **$4.62 million**, expected to be recognized over a weighted average period of **2.38 years**[256](index=256&type=chunk) Restricted Stock Activity (9 Months Ended Dec 31, 2023) | Metric | Shares | Weighted Average Fair Value (thousands of USD) | |:---|:---|:---|\n| Outstanding, at March 31, 2023 | 467,058 | $18,035 | | Granted | — | — | | Vested | (140,558) | $(5,448) | | Forfeited/cancelled/expired | (4,500) | $(235) | | **Outstanding, at December 31, 2023** | **322,000** | **$12,352** | [NOTE 21 – LEASES](index=67&type=section&id=NOTE%2021%20%E2%80%93%20LEASES) This note provides information on the company's lease assets, liabilities, and related lease terms Lease Related Assets and Liabilities (Amounts in thousands of USD) | Classification on Balance Sheet | Dec 31, 2023 | |:---|:---|\n| Operating lease assets (Right-of-use assets) | $34,180 | | Operating lease liability (Lease liability) | $34,614 | Annual Maturities of Lease Liabilities (Amounts in thousands of USD) | Fiscal Year | Amount | |:---|:---|\n| 2024 | $4,108 | | 2025 | $11,228 | | 2026 | $10,566 | | 2027 | $8,517 | | 2028 | $5,770 | | Thereafter | $4,387 | | **Total payments** | **$44,576** | | Less: amounts representing interest | $(9,962) | | **Lease liability, net** | **$34,614** | | Weighted average remaining lease term (in months) | 31 | | Weighted average discount rate | 15% | - The Group's operating lease assets and liabilities were **$34.18 million** and **$34.61 million**, respectively, as of December 31, 2023, with a weighted average remaining lease term of **31 months** and a discount rate of **15%**[262](index=262&type=chunk) [NOTE 22 – ACQUISITIONS OF SUBSIDIARIES](index=68&type=section&id=NOTE%2022%20%E2%80%93%20ACQUISITIONS%20OF%20SUBSIDIARIES) This note details recent acquisitions of subsidiaries and their impact on goodwill and business expansion - In April 2023, the Company acquired **100% of Aviata and Internet-Tourism** for **$31.3 million** and **$2.0 million**, respectively, to expand its digital services ecosystem in Kazakhstan[264](index=264&type=chunk)[265](index=265&type=chunk)[267](index=267&type=chunk) - The acquisition of Aviata resulted in **$21.8 million in goodwill**, while Internet-Tourism generated **$0.64 million in goodwill**[266](index=266&type=chunk)[268](index=268&type=chunk) - The Company increased its equity interest in Arbuz to **94.73%** by December 31, 2023, gaining effective control in May 2023, with the acquisition resulting in **$14.96 million in goodwill**[269](index=269&type=chunk)[270](index=270&type=chunk)[271](index=271&type=chunk) - In July 2023, the Company acquired **90% of ReKassa** for **$3.1 million** to accelerate growth in the digital sector, resulting in **$0.56 million in goodwill**[272](index=272&type=chunk)[273](index=273&type=chunk) [NOTE 23 – COMMITMENTS AND CONTINGENCIES](index=72&type=section&id=NOTE%2023%20%E2%80%93%20COMMITMENTS%20AND%20CONTINGENCIES) This note discloses the company's off-balance sheet commitments and potential contingencies - Freedom Bank KZ is exposed to credit and market risk from off-balance sheet financial instruments, including guarantees and unfunded commitments under lines of credit[274](index=274&type=chunk) Total Lending Related Commitments Outstanding (Amounts in thousands of USD) | Commitment Type | Dec 31, 2023 | Mar 31, 2023 | |:---|:---|:---|\n| Unfunded commitments under lines of credits and guarantees | $126,823 | $20,617 | | Bank guarantees | $7,342 | $7,001 | | **Total** | **$134,165** | **$27,618** | - Total lending-related commitments outstanding significantly increased to **$134.2 million** at December 31, 2023, from **$27.6 million** at March 31, 2023[278](index=278&type=chunk) [NOTE 24 – SEGMENT REPORTING](index=74&type=section&id=NOTE%2024%20%E2%80%93%20SEGMENT%20REPORTING) This note presents financial information by the company's operating segments, including revenue and assets - The Company organizes its operations into four regional segments: Central Asia and Eastern Europe, Europe Excluding Eastern Europe, United States, and Middle East/Caucasus, based on how the CODM allocates resources and assesses performance[279](index=279&type=chunk) Total Revenue, Net by Geographic Segment (Amounts in thousands of USD) | Segment | 3 Months Ended Dec 31, 2023 | 3 Months Ended Dec 31, 2022 | 9 Months Ended Dec 31, 2023 | 9 Months Ended Dec 31, 2022 | |:---|:---|:---|:---|:---|\n| Central Asia and Eastern Europe | $361,334 | $152,495 | $1,031,310 | $365,141 | | Europe Excluding Eastern Europe | $39,504 | $61,109 | $102,400 | $194,090 | | United States | $5,586 | $358 | $15,047 | $7,294 | | Middle East/Caucasus | $12,210 | $16 | $21,668 | $82 | | **Total revenue, net** | **$418,634** | **$213,978** | **$1,170,425** | **$566,607** | - Central Asia and Eastern Europe segment revenue increased by **137%** for the three months and **182%** for the nine months ended December 31, 2023, driven by interest income, brokerage, banking, and insurance activities[280](index=280&type=chunk)[282](index=282&type=chunk)[283](index=283&type=chunk)[284](index=284&type=chunk)[460](index=460&type=chunk)[464](index=464&type=chunk) - Europe Excluding Eastern Europe segment revenue decreased by **35%** for the three months and **47%** for the nine months ended December 31, 2023, mainly due to reduced brokerage activity from FST Belize[280](index=280&type=chunk)[282](index=282&type=chunk)[283](index=283&type=chunk)[284](index=284&type=chunk)[460](index=460&type=chunk)[464](index=464&type=chunk) Total Assets and Liabilities by Geographic Segment (Amounts in thousands of USD) | Segment | Total Assets (Dec 31, 2023) | Total Liabilities (Dec 31, 2023) | Total Assets (Mar 31, 2023) | Total Liabilities (Mar 31, 2023) | |:---|:---|:---|:---|:---|\n| Central Asia and Eastern Europe | $6,419,659 | $5,795,495 | $4,303,126 | $3,868,326 | | Europe Excluding Eastern Europe | $422,348 | $561,395 | $677,425 | $384,921 | | United States | $87,842 | $30,223 | $101,365 | $60,198 | | Middle East/Caucasus | $519,194 | $22,680 | $2,642 | $377 | | **Total** | **$7,449,043** | **$6,409,793** | **$5,084,558** | **$4,313,822** | [NOTE 25 – SUBSEQUENT EVENTS](index=80&type=section&id=NOTE%2025%20%E2%80%93%20SUBSEQUENT%20EVENTS) This note discloses any material events occurring after the balance sheet date but before the report filing - The Company has evaluated subsequent events through the filing date of this quarterly report and found no additional material recognizable events beyond those disclosed[296](index=296&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=81&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides a detailed discussion and analysis of Freedom Holding Corp.'s financial condition and results of operations, highlighting key factors affecting the business [Overview of Business and Operations](index=82&type=section&id=Overview) This section provides an overview of Freedom Holding Corp.'s diverse financial services and strategic digital fintech ecosystem - Freedom Holding Corp. (FRHC) is a holding company for subsidiaries engaged in diverse financial services, including retail securities brokerage, investment banking, commercial banking, and insurance, with a strategic focus on building a digital fintech ecosystem[305](index=305&type=chunk)[306](index=306&type=chunk) - The business operates across four regional geographic segments: Central Asia and Eastern Europe, Europe Excluding Eastern Europe, the United States, and Middle East/Caucasus[307](index=307&type=chunk) - FRHC is expanding into telecommunications and media in Kazakhstan through Freedom Telecom and Freedom Media, aiming for a comprehensive user-centric digital experience[319](index=319&type=chunk)[320](index=320&type=chunk)[321](index=321&type=chunk) - S&P Global Ratings affirmed FRHC's long-term credit rating at **'B-' with a negative outlook**, citing risks from third-party allegations, while core subsidiaries maintained **'B/B' ratings**[322](index=322&type=chunk)[323](index=323&type=chunk) [Key Factors Affecting Results of Operations](index=85&type=section&id=Key%20Factors%20Affecting%20Our%20Results%20of%20Operations) This section discusses significant factors influencing the company's financial performance, including geopolitical events and acquisitions - The Russia-Ukraine conflict continues to impact the Company, leading to the divestiture of Russian subsidiaries in February 2023 and heightened risks from evolving sanctions and countersanctions[326](index=326&type=chunk)[328](index=328&type=chunk)[331](index=331&type=chunk) - Customer liabilities related to sanctioned individuals and entities increased significantly to **$96.6 million (4.3% of total)** as of December 31, 2023, from **$17.8 million (0.92%)** at March 31, 2023, due to an omnibus customer's parent being sanctioned[330](index=330&type=chunk) - The Company's total customer accounts grew from approximately **250,000** at March 31, 2022, to **458,312** at December 31, 2023, with Kazakhstan and Russian persons being key customer bases[344](index=344&type=chunk) - Recent acquisitions include Internet-Touris

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2023 OR o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ________ to _________ Commission File Number 001-33034 FREEDOM HOLDING CORP. (Exact name of registrant as specified in its charter) (State or other jurisdiction of i ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-K x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended March 31, 2023 OR o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ________ to _________ Commission File Number 001-33034 FREEDOM HOLDING CORP. (Exact name of registrant as specified in its charter) | Nevada 30-0233726 | | | | - ...

[PART I — FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%20%E2%80%94%20FINANCIAL%20INFORMATION) This section covers unaudited financial statements, management's analysis, market risk, and internal controls [Item 1. Unaudited Condensed Consolidated Financial Statements](index=4&type=section&id=Item%201.%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) This chapter presents unaudited condensed consolidated financial statements, including recast prior periods and restatements, with Russian operations classified as discontinued [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of December 31, 2022, total assets increased to $5.37 billion from $3.23 billion at March 31, 2022, driven by growth in trading securities, loans, and customer liabilities Condensed Consolidated Balance Sheet Highlights (in thousands of USD) | Account | Dec 31, 2022 | Mar 31, 2022 (Recasted) | | :--- | :--- | :--- | | **Total Assets** | **$5,368,134** | **$3,227,750** | | Cash and cash equivalents | $664,095 | $225,464 | | Trading securities | $1,929,840 | $1,158,377 | | Loans issued | $639,377 | $92,446 | | Assets held for sale | $961,566 | $825,419 | | **Total Liabilities** | **$4,685,803** | **$2,681,142** | | Securities repurchase agreement obligations | $1,233,928 | $840,224 | | Customer liabilities | $1,786,452 | $765,628 | | Liabilities held for sale | $931,484 | $812,478 | | **Total Shareholders' Equity** | **$682,331** | **$546,608** | [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Net income for the three months ended December 31, 2022, increased to $62.4 million, while the nine-month net income decreased to $148.7 million due to reduced trading gains, with Russian operations reported as discontinued Key Operating Results (in thousands of USD, except per share data) | Metric | Three Months Ended Dec 31, 2022 | Three Months Ended Dec 31, 2021 (Restated) | Nine Months Ended Dec 31, 2022 | Nine Months Ended Dec 31, 2021 (Restated) | | :--- | :--- | :--- | :--- | :--- | | **Total Revenue, Net** | **$214,548** | **$155,169** | **$566,686** | **$597,549** | | Fee and commission income | $80,883 | $91,408 | $253,486 | $262,549 | | Net gain on trading securities | $25,456 | $7,663 | $38,894 | $197,947 | | Interest income | $80,255 | $33,657 | $187,817 | $82,514 | | **Income from Continuing Operations** | **$46,391** | **$58,178** | **$138,754** | **$319,840** | | **Income/(loss) from Discontinued Operations** | **$16,009** | **($4,105)** | **$9,929** | **($3,656)** | | **Net Income** | **$62,400** | **$54,073** | **$148,683** | **$316,184** | | **EPS - Diluted** | **$1.36** | **$0.91** | **$2.81** | **$5.34** | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the nine months ended December 31, 2022, net cash used in operating and investing activities totaled $465.8 million and $641.3 million respectively, offset by a $1.51 billion inflow from financing activities, resulting in a **$484.1 million net increase in cash** Cash Flow Summary (Nine Months Ended Dec 31, in thousands of USD) | Cash Flow Activity | 2022 | 2021 (Restated) | | :--- | :--- | :--- | | Net cash flows used in operating activities | ($465,791) | ($611,853) | | Net cash flows used in investing activities | ($641,321) | ($93,095) | | Net cash flows from financing activities | $1,506,188 | $441,794 | | **Net Change in Cash, Cash Equivalents and Restricted Cash** | **$484,140** | **($256,780)** | [Notes to Condensed Consolidated Financial Statements](index=13&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) This section details business operations, accounting policies, and key financial events, including Russian divestiture, recast financials, related-party transactions, and segment reporting - The company has entered into an agreement to sell its Russian subsidiaries, Freedom RU and Freedom Bank RU, which are now classified as assets and liabilities held for sale and reported as discontinued operations[28](index=28&type=chunk)[224](index=224&type=chunk) - Financial statements for prior periods were recast to reflect the acquisition of Freedom Life and Freedom Insurance, deemed under common control, and restated to correct classification errors in the Statement of Cash Flows and Statement of Operations[111](index=111&type=chunk)[113](index=113&type=chunk)[122](index=122&type=chunk) - The company restructured its operations into five geographical segments: Central Asia, Europe, the U.S., Russia (discontinued), and Middle East/Caucasus[98](index=98&type=chunk)[241](index=241&type=chunk) - A significant portion of fee and commission income is generated from FFIN Brokerage, a company owned by FRHC's CEO, Timur Turlov, accounting for approximately **93% of total related party fee and commission income** ($181.4 million) for the nine months ended Dec 31, 2022[193](index=193&type=chunk)[194](index=194&type=chunk) - An impairment charge of **$43,973 thousand** was recorded for the nine months ended December 31, 2022, related to the planned divestiture of the Russian subsidiaries[228](index=228&type=chunk)[234](index=234&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=76&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance, key factors like the Russian divestiture, and liquidity, highlighting revenue and net income trends for the quarter and nine-month period [Overview and Key Factors](index=77&type=section&id=Overview%20and%20Key%20Factors) This section outlines the company's five geographic segments, key factors like the Russian subsidiary sale, customer account growth, and significant related-party transactions - The company entered into an agreement to sell its Russian subsidiaries, with the sale approved by the Central Bank of the Russian Federation on February 10, 2023, and expected to close before the end of February 2023[265](index=265&type=chunk)[282](index=282&type=chunk) - Total customer accounts grew from approximately **250,000** as of March 31, 2022, to approximately **350,000** as of December 31, 2022[291](index=291&type=chunk) - Fee and commission income from FFIN Brokerage (a related party) accounted for approximately **54% and 67% of total fee and commission income** for the three and nine months ended December 31, 2022, respectively[297](index=297&type=chunk) [Results of Operations](index=83&type=section&id=Results%20of%20Operations) For the three months ended Dec 31, 2022, total revenue increased 38% to $214.5 million, while for the nine-month period, total revenue decreased 5% to $566.7 million, primarily due to lower trading gains Revenue Comparison - Three Months Ended Dec 31 (in thousands of USD) | Revenue Source | 2022 | 2021 (Restated) | Change % | | :--- | :--- | :--- | :--- | | Fee and commission income | $80,883 | $91,408 | (12)% | | Net gain on trading securities | $25,456 | $7,663 | 232% | | Interest income | $80,255 | $33,657 | 138% | | **Total revenue, net** | **$214,548** | **$155,169** | **38%** | Expense Comparison - Three Months Ended Dec 31 (in thousands of USD) | Expense Category | 2022 | 2021 (Recasted) | Change % | | :--- | :--- | :--- | :--- | | Interest expense | $52,037 | $21,890 | 138% | | Operating expense | $50,608 | $31,581 | 60% | | Provision for impairment losses | $24,140 | ($333) | (7349)% | | **Total expense** | **$163,088** | **$95,185** | **71%** | - For the nine months ended Dec 31, 2022, net gain on trading securities fell by **80% to $38.9 million** from $197.9 million in the prior-year period[352](index=352&type=chunk) [Liquidity and Capital Resources](index=100&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity strengthened with cash and cash equivalents rising to $664.1 million, driven by a $1.51 billion inflow from financing activities, and all subsidiaries met minimum net capital requirements Cash Flow Summary - Nine Months Ended Dec 31 (in thousands of USD) | Flow | 2022 | 2021 (Restated) | | :--- | :--- | :--- | | Net cash used in operating activities | ($465,791) | ($611,853) | | Net cash used in investing activities | ($641,321) | ($93,095) | | Net cash from financing activities | $1,506,188 | $441,794 | | **Net Change in Cash** | **$484,140** | **($256,780)** | - As of December 31, 2022, the aggregate minimum net capital and capital adequacy requirement for the company's subsidiaries was approximately **$56.7 million**, and all subsidiaries were in compliance[414](index=414&type=chunk) [Item 3. Qualitative and Quantitative Disclosures About Market Risk](index=104&type=section&id=Item%203.%20Qualitative%20and%20Quantitative%20Disclosures%20About%20Market%20Risk) The company faces market, credit, and operational risks, with a hypothetical 100 basis point interest rate increase impacting its investment portfolio by $65.4 million and significant credit concentration in related-party margin lending - A sensitivity analysis shows that a hypothetical **100 basis point increase in interest rates** would result in a **$65.4 million decline** in the fair market value of the investment portfolio as of December 31, 2022[434](index=434&type=chunk) - As of December 31, 2022, **97% of the company's margin lending receivables balance** was due from FFIN Brokerage, an affiliate owned by the company's CEO[439](index=439&type=chunk) - A **10% adverse change in the value of the U.S. dollar** against all other functional currencies would have resulted in a decrease of income before income tax by approximately **$5.5 million** as of December 31, 2022[435](index=435&type=chunk) [Item 4. Controls and Procedures](index=109&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were ineffective as of December 31, 2022, due to material weaknesses in internal control over financial reporting, necessitating a remediation plan - Management concluded that disclosure controls and procedures were **not effective** as of December 31, 2022, due to material weaknesses in internal control over financial reporting[463](index=463&type=chunk) - The material weaknesses relate to the incorrect classification of certain loans and deposits in the Statement of Cash Flows and interest income from margin loans in the Statement of Operations, leading to a restatement of prior financial periods[465](index=465&type=chunk) - Management has initiated a remediation plan to enhance the design of its control activities to address these weaknesses[467](index=467&type=chunk) [PART II — OTHER INFORMATION](index=110&type=section&id=PART%20II%20%E2%80%94%20OTHER%20INFORMATION) This section covers legal proceedings, updated risk factors, and a list of exhibits filed with the report [Item 1. Legal Proceedings](index=110&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in routine legal proceedings, including a specific litigation where $8,378 was deposited with the court, with management not expecting a material adverse effect on financial condition - In the Estate of Toleush Tolmakov litigation, the company deposited **$8,378** with the court registry on October 21, 2022, in accordance with a court order[471](index=471&type=chunk) [Item 1A. Risk Factors](index=110&type=section&id=Item%201A.%20Risk%20Factors) New and updated risk factors include uncertainties regarding the Russian subsidiary sale, potential inaccuracies in insurance business modeling, and material weaknesses in internal control over financial reporting impacting financial accuracy and investor confidence - There is a risk that the sale of the Russian subsidiaries may not be completed as expected or achieve its intended effects, such as reducing geopolitical exposure and accelerating growth in other markets[473](index=473&type=chunk)[474](index=474&type=chunk) - The company's insurance businesses face risks from modeling and assumptions that may differ from actual results, potentially leading to mispricing of products[475](index=475&type=chunk) - The company has identified material weaknesses in its internal control over financial reporting, which could adversely affect its ability to report financial results accurately and on time, potentially damaging investor confidence and the stock price[480](index=480&type=chunk)[486](index=486&type=chunk) [Item 6. Exhibits](index=112&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including CEO and CFO certifications and financial information formatted in inline XBRL - The filing includes required CEO and CFO certifications (Exhibits 31.01, 31.02, 32.01) and financial data in inline XBRL format (Exhibit 101)[487](index=487&type=chunk)

FORM 10-Q x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2022 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Address of principal executive offices) (Zip Code) +7 727 311 10 64 (Registrant's telephone number, including area code) Securities registered under Section 12(b) of the Act: OR o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition p ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2022 OR o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ________ to _________ Commission File Number 001-33034 FREEDOM HOLDING CORP. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorp ...