REG - CAB Payments Hldgs - CAB Payments Full Year 2025 Results
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RNS Number : 4111V CAB Payments Holdings PLC 05 March 2026
5 March 2026
CAB Payments Holdings plc and its subsidiaries
("CAB", "CAB Payments", the "Group" or the "Company")
Full Year Results 2025
Returning to profitable growth: Business transformed, strategy delivering
CAB Payments, the specialist bank connecting fast growing and dynamic markets
to the global financial system, today announces its audited results for the 12
months ended 31 December 2025. It returns to profitable growth with Total
Income up 12% year on year to £119m and Adjusted EBITDA up 14% to £35m.
Commenting on the results, Neeraj Kapur, Group CEO, said today:
"These results mark a turning point. We have exceeded market expectations and
delivered strong growth in revenue, volumes, client numbers and underlying
profitability. We are seeing the benefits of the strategic realignment of the
business that took place in the second half of 2024 and the first half of
2025. Our relationship-led approach is winning and growing clients.
Our purpose is to deliver prosperity in the markets we serve. These are some
of the world's fastest-growing, hardest-to-reach economies, and they are
playing an ever more important role in global commerce with greater demand for
access to the international financial framework. We are investing in our
network, our people, our products and our platform to ensure we deliver on
that purpose. The Group enters 2026 with strong momentum and we are confident
of delivering sustained, profitable growth. We expect to grow our top line
significantly. This will improve operating leverage, drive compounding
profits and meaningful capital generation."
Highlights:
• Total Income +12% YoY to £119m and +30% HoH, driven by
broad-based growth in client acquisition and deepening of relationships across
new products and markets
• Adjusted EBITDA +14% YoY to £35m; with adjusted EBITDA margin
rising to 30% (2024: 29%) demonstrating increasing operating leverage, notably
in H2
• Adjusted EPS +9% YoY to 6.8p
• Reported EPS down 0.2p per share to 5.4p per share after one-off
restructuring costs
• Active clients increased to 592 (2024: 546 ); client onboarding
times reduced by 40%
• Wholesale FX & Payment FX volumes +13% to £41.9bn (2024:
£37.2bn); payments processed +19% to 1.2m transactions
• New York office opened in December 2025; Abu Dhabi office
commenced in January 2026; further selective licenses progressing in Africa
and LATAM
• Additional US dollar and euro clearing banking partner
appointed, strengthening operational resilience and adding capacity to better
serve our clients and markets
• Strong pro-forma CET1 ratio of 22.1% (2024: 19.2%), balance sheet
remains highly liquid and short-dated
• Entered 2026 with robust performance in January and February
• Targeting high-teens to low 20s percentage CAGR growth in Total
Income (ex Net Interest Income) over the next 3 years and higher operating
leverage leading to strong capital generation
A business transformed, returned to growth - a compelling shareholder
proposition
• An attractive shareholder story
◦ Quality revenue growth - diversified, sustainable and profitable
growth
◦ Operational leverage delivery - cost-base reshaped, productivity
focus leading to profit accretion
◦ Growth through infrastructure investment - technology, people,
network, relationships, driving scalability
• A differentiated investment thesis:
◦ Structural growth drivers - Aligned to fast-growing and dynamic
markets
◦ Specialised emerging markets network - differentiated and trusted
access to complex markets
◦ Deep relationships - relationships built over decades with central
banks and other clients, driving sustainable growth
◦ Flexible payments platform - with direct multi‑rail access and
built‑in flexibility to evolve
◦ Scalable business model - with long-term operating leverage
◦ Regulated infrastructure platform - licences driving preferential
market access to liquidity, relationship longevity and trust
New medium-term framework:
2026 trading has started well and the Group expects its strategy to continue
to deliver.
Revenue
• Well positioned to deliver Total Income excluding Net Interest
Income growing at a high teens to low 20s percentage CAGR over the next three
years
• Lower US interest rates are expected to create near-term headwinds
for Net Interest Income
Operating leverage
• Expect to deliver continued positive operating leverage and a
structural reduction in Cost: Income ratio over time
Investment
• The Group expects Capital Expenditure to increase in 2026 while it
builds out its future-ready operating platform for the next stage of growth
Capital
• Capital-lite cash generative business model growing surplus
capital for deployment into growth and shareholder returns
• Formal capital return framework to be laid out at the FY26 results
Significant improvement in strategic KPIs
• Active clients: 592, up from 546 in 2024 (+8%); strong sales
performance and relationship‑led model continued to drive growth
• Total FX volumes +13% to £41.9bn (2024: £37.2bn)
- G10 FX volumes +20% to £28.4bn (+9% HoH), driven by increased demand
from local and central banks
- Emerging FX volumes broadly flat at £13.5bn (+16% HoH), with
lower IDO volumes offset by higher Fintech activity
- Take‑rates increased to 15bps (2024: 14bps 2023: 25bps)
reflecting specialised access to liquidity and structured solutions activity
notably in H2
• Payments processed +19% to 1.2m transactions, supported by
expanded payment rails including new Automated Clearing House (ACH) and
payment to mobile capability
• Revenue is more diverse, with top 5 corridor concentration at 32%
well below the 49% peak in H1-2023
• Trade Finance income +52%, as we supported more clients and built
our capabilities further, including starting secondary distribution
• Average deposits +4% to £1.5bn, underpinned by call deposit
growth
• Interest‑rate hedging strategy successfully deployed to manage
potential income volatility arising from rate changes
Strategic progress alongside client growth underpins confidence for delivery
in 2026
• Two new offices licensed and operational: New York (Q4 2025) and
Abu Dhabi (Q1 2026).
• FX Derivatives capability built, ACH rails expanded to 54
currencies and A+ rated Guaranteed Deposits product launched
• Network expanded with 39 new nostro accounts and 11 new liquidity
providers; total partners now 440 (2024: 390)
• Additional US dollar and euro clearing banking partner appointed
• Trade Finance syndication capability progressed
Investor presentations
CAB Payments will host two webcasts for the investment community:
5 March, 09:30 UKT - Analyst & Institutional Investor Webcast
• Presentation with Neeraj Kapur, Group CEO, and James Hopkinson,
Group CFO.
• Presentation available at: https://www.cabpayments.com/investors
(https://www.cabpayments.com/investors)
• Register: https://secure.emincote.com/client/cab/2025annualresults
(https://secure.emincote.com/client/cab/2025annualresults)
• Please submit any Q&A to ir@cabpayments.com, answers will be
published on the Group's website
6 March, 09:30 UKT - Retail Investor Webcast
• Presentation with Neeraj Kapur, Group CEO, and James Hopkinson,
Group CFO.
• Presentation available at:
https://www.equitydevelopment.co.uk/news-and-events/cab-payments-investor-presentation-fy-results-6th-march-2026
(https://www.equitydevelopment.co.uk/news-and-events/cab-payments-investor-presentation-fy-results-6th-march-2026)
• Written questions can be submitted throughout the live session and
responses will be published on the Group's website
About CAB Payments:
CAB Payments, via its operating subsidiary Crown Agents Bank Limited, exists
to deliver prosperity in the markets we serve. With a network built over more
than 180 years, we connect the world's hardest-to-reach financial markets to
the global economy, moving money across 124 currencies and 800+ currency pairs
via API, digital platforms or bespoke solutions. Crown Agents Bank Limited is
one of the first banks to achieve B Corporation™ status and holds the
Platinum Sustainability Rating from EcoVadis, ranking within the top 1% of
companies assessed globally.
For further information, please contact:
CAB Payments Holdings plc
Gaurav Patel, Head of Investor Relations
ir@cabpayments.com
Mat Loup, Head of Media Relations
Media.enquiries@crownagentsbank.com
www.cabpayments.com
FTI Consulting (Public Relations Adviser to CAB Payments)
Edward Bridges +44 (0) 7768 216 607
Katherine Bell +44 (0) 7976 870 961
cabpayments@fticonsulting.com
Overview of financial performance
Total income
• Total Income +12% YoY to £119.0m (2024: £106.4m), with strong
acceleration into H2 (+30% HoH) despite emerging NII headwinds from reduced
global interest rates
• Total Income excluding NII +17% YoY to £87.5m (2024: £74.6m),
+48% HoH
• Wholesale FX Income +25% (+75% HoH), driven by volume growth from
banking, fintech and corporate clients and improved margins
• Payments Income flat YoY (+15% HoH) reflecting a non-recurrence of
margin dislocation in early 2024 that affected revenue growth. Payment volumes
increased 27% HoH as growth resumed
• Banking Income +8% YoY (flat HoH), reflecting 1% reduction YoY
(down 9% HoH) in Net Interest Income despite 4% growth in average deposits, as
interest rates fell towards the end of the year. This was offset by Trade
Finance income which increased 52% YoY (+38% HoH)
Operating expenses
• Operating costs (excluding Depreciation and Armotisation) +10% to
£83.9m (2024: £76.2m) reflecting inflation, as well as investment in our
client facing teams, product and building our network of offices
internationally
• Staff costs (ex‑variable comp): broadly flat, as guided,
reflecting execution of restructuring plan in Q1 allowing selected investment
in front office teams and network expansion
• Variable compensation increased, aligned to performance and
strategic delivery improvements
• Cost of sales +16%, reflecting higher activity-based transaction
costs
• Other operating expenses +8%, reflecting inflation and
professional fees as we built out product and risk management capability
Profitability
• Adjusted EBITDA +14% to £35.2m with Adjusted EBITDA margin at 30%
(2024: 29%), demonstrating improving operating leverage
• Adjusted Cost:income ratio at 79% (2024: 80%) with significant
improvement in H2 vs H1 (74% vs 85%)
• Depreciation & amortisation +25% YoY to £10.6m (2024: £8.5m)
due to higher 2024 capex beginning to amortise in 2025
• Adjusted PAT +9%; Adjusted EPS +9% YoY
• Reported PAT down 4% to £13.6m (2024: £14.2m) due to
restructuring costs and higher tax
Investment
• As guided, investment is £8.7m (down 42% YoY, as guided) was
largely focused on product enhancements
Capital & liquidity
• Proforma CET1 ratio strengthened to 22.1%(2024: 19.2%) as we
remain a well-capitalised bank with a very low level of lending relative to
our deposits
• The group is highly liquid with NSFR and LCR ratios strong at 148%
and 123% respectively. Adjusted ROE was 11% (2024: 11%)
Note:
(a) All growth rates are year-on-year unless specified
(b) 2024 Total Income has been re-presented to add back IFRS 16 interest
expense on lease liabilities reflecting updated presentation of the Group's
financial statements. The IFRS 16 interest expense on lease liabilities is
reflected separately in the Profit and Loss statement under other finance
costs.
(c) In Q1 2025, a review of the primary nature of client payment activity
was completed and a portion of client income was reclassified from Wholesale
FX income to Payment FX income. To ensure comparability, prior period
financial information related to these products has been reclassified,
amounting to £2.2m of FY24 income from Wholesale FX to Payment FX
Selected Financial Information and KPIs for Continued Operations:
Adjusted Income statement (£m)
Twelve Months Ended 31 December 2025 2024 YoY growth % H2 vs H1 growth %
Wholesale FX 48.7 39.0 25 % 75 %
Payments 29.5 29.5 - % 15 %
Banking 40.8 37.9 8 % - %
Total Income 119.0 106.4 12 % 30 %
Staff costs (50.4) (45.7) 10 % 22 %
Other operating expenses (33.5) (30.5) 10 % 9 %
Reversal of impairment provisions 0.1 0.6 (83) % (100) %
Adjusted EBITDA 35.2 30.8 14 % 69 %
IFRS 16 Interest expense on lease liabilities (1.4) (0.9) 56 % (14) %
Depreciation & Amortisation (10.6) (8.5) 25 % 4 %
Adjusted Profit Before Tax 23.2 21.3 9 % 122 %
Adjusted taxation (5.8) (5.3) 9 % 122 %
Adjusted Profit after Tax 17.4 16.0 9 % 122 %
Adjusted EPS (pence) 6.8 6.3 9 % 119 %
Selected Financial Information (£m) - Reported
2025 2024 YoY growth % H2 vs H1 growth %
Profit before tax 18.5 17.6 5 % 397 %
Profit after tax 13.6 14.2 (4) % 387 %
Earnings per share (pence) 5.4 5.6 (4) % 389 %
Wholesale FX and Payments FX Information
Volume (£bn) Take Rate (%) Income (£m)
2025 2024 2025 2024 2025 2024
G10 28.4 23.7 0.07 % 0.06 % 20.5 15.3
Emerging Markets 13.5 13.5 0.31 % 0.29 % 42.2 38.5
Total 41.9 37.2 0.15 % 0.14 % 62.7 53.8
Other Management Information
2025 2024 YoY growth % H2 vs H1 growth %
Capital & Investment
Core Capex (£m) 8.6 12.5 (31) % 49 %
Capital intensity (% of Total Income) 7 % 14 % (50) % 14 %
Operating Free Cash Flow (£m) 27.2 15.5 75 % 86 %
Operating Free Cash Flow Conversion (%) 77 % 50 % 54 % 11 %
Total CET1 Capital (£m) 129.3 116.0 11 % 12 %
CET1 Ratio (%) 22.1 % 19.2 % 15 % 13 %
Margin
Adjusted EBITDA Margin (%) 30 % 29 % 3 % 32 %
Adjusted Cost:Income Ratio (%) 79 % 80 % (1) % (12) %
Income
Total Income (excl. Net Interest Income) (£m) 87.5 74.6 17 % 48 %
Wholesale & Payments FX (£m) 78.2 68.5 14 % 49 %
Wholesale and Payment FX Volume (£bn) 41.9 37.2 13 % 11 %
Income by client type
Banks (£m) 71.9 62.4 15 % 16 %
Fintechs & Corporates (£m) 33.2 28.8 15 % 66 %
IDOs (£m) 13.9 15.2 (9) % 36 %
Chief Executive Officer's Review
'Delivering prosperity in the markets we serve has never been more relevant.
The Group plays a vital role in a world of shifting trade dynamics and
development in fast-growing and complex economies. The macro-economic
conditions throughout the world are complex and turbulent. Our consistent
presence, and enduring purpose helps us stay the course as we connect
communities, institutions and businesses to the global financial system,
enabling capital to flow where it is needed most
We have fundamentally reshaped how we do business. Where previously we offered
specific products to particular clients, we now seek to build deep, lasting
relationships across our client base - from central banks and international
development organisations to commercial banks and corporates - offering them
the power of our entire platform to solve their challenges. This shift to a
broader relationship-driven model and a solutions focus is the foundation of
our sustainable growth.
In 2025, our purpose and model translated into meaningful results. Total
Income grew 12% year-on-year to £119.0m, and 30% half-on-half to £67.2m,
ahead of market expectations. This is a significant step forward and evidence
that our relationship-led model is working.
With our transformation complete, we are focused on capturing the significant
opportunity ahead. Our cost base is now reshaped for growth, and we see the
operational leverage inherent in our model - income growth outpacing cost
growth. Reported EPS, however, fell 4% to 5.4p, reflective of the one-time
investment we made to complete this transformation.
In the markets we serve, business is built on trust, face-to-face. Our
expansion into New York, Abu Dhabi and deeper into Africa puts us closer to
clients, facilitating the relationship-led approach that sets us apart. We are
now where our clients need us most. Global macro-headwinds are ever present,
including a changing political landscape, trade tariffs and availability of
finance. This adds a level of volatility and uncertainty which our clients are
navigating. This is also where we can stand up and excel as an institution.
Our reputation as a reliable partner is driven by our expertise in providing
fast, secure and effective FX and cross-border payment solutions in complex
environments. We deliver a strong value proposition for clients, guiding them
through market complexity while continuing to invest for global growth.
The Group is now a stronger and more focused organisation, well placed to
deliver sustainable growth and value. I am proud of what we have achieved
together.
Significant market opportunity
The markets we serve are vast and growing. Africa's cross border payments
exceed $300 billion annually while Latin American and Caribbean remittance
flows surpassed $170 billion in 2025.
As larger institutions eye these opportunities, our longstanding presence,
local expertise, and strong relationships set us apart. While some
institutions are only now seeking to return or expand their footprint, we have
consistently supported clients in these regions, often stepping in when others
have withdrawn. This consistency of service is an important differentiator and
has built deep trust over time.
The global digital payments revolution is gathering pace. There are
approximately 1.1 billion mobile wallets in Sub-Saharan Africa((1)) and 37% of
adults in Latin America and the Caribbean have a mobile-money account((2)). We
embrace these trends through investments in solutions such as Automated
Clearing House (ACH) rails, delivering faster, lower-cost payments to multiple
endpoints including mobile wallets.
We are also exploring how we can help deliver blockchain-based payments,
including central bank-backed stablecoins. Stablecoin networks are expanding
rapidly and are growing in significance in the markets which we serve. We want
to be on the front foot as regulation develops in this space to ensure we are
providing clients with the serve they need. As regulatory reforms like the
Pan-African Payments and Settlement System promote greater interoperability,
we are investing in modern infrastructure to enhance liquidity and
connectivity.
1 Finance in Africa. July 2025
2 World Bank. July 2025
Strategic Progress
Our four-pillar strategy focusing on clients, network, platform and innovation
is driving momentum and robust financial results. In 2025, we achieved
significant milestones. Critically, we have shifted from simply providing
individual products to delivering comprehensive and integrated solutions - a
change that reflects our broader pivot to relationship-driven banking.
Our long-standing relationships with central banks, recognised by our Global
Markets Awards at the 2025 Central Banking Awards, provide the foundation for
stable, recurring income. These partnerships, built over decades,
differentiate us from competitors and underpin the sustainability of our
growth.
Increasing our client base
We are increasingly the partner of choice for clients. In 2025, our net active
client base grew to 592, up from 546 in 2024. We have strengthened our
position across key client segments with our banking clients, recognising our
collaborative and transparent approach. We have repositioned our sales teams
to serve clients through multiple lenses: geographies, client type and
products. We also significantly improved our client onboarding times, bringing
them down by 40%, delivering a better client journey and quicker times to
monetisation. In 2025, we grew our average revenue per client from £193.3k in
2024 to £201k in 2025, reflecting our push to gain a higher share of wallet
from our existing client base.
Developing our network
Our network of liquidity and nostro providers expanded to 440 as of
31 December 2025, up from 390 in the same period last year.
We continually review our relationships to ensure we can deliver
market-leading pricing and quality for clients. Our banking licence is a
critical differentiator and fundamental to our relationship-driven model and
building our network. Local banks engage with us as a regulated peer, not just
a service provider.
Our network is strengthened further by mutually beneficial partnerships, such
as providing international transactional banking in return for improved
liquidity and pricing. We are delighted to have been onboarded by another
major global bank in early 2026, who will provide us with USD clearing
services. This specific relationship enables us to expand transaction volumes
and improve ease of business, as well as diversify our essential USD clearing
capabilities.
Enhancing our platform
In 2025, we ramped up our structured solutions proposition, delivering more
stable fee income and unlocking liquidity for central banks and corporates,
underpinning resilient revenue flows.
Our expanded product suite now enables us to, for example, offer FX
derivatives and A+ rated deposits, which increase our ability to meet client
need and post-launch, they will help improve the quality and breadth of our
client conversations. While we have launched these products we have not yet
monetised these and intend to do so in 2026. We also enhanced our payment
capabilities through ACH rails allowing us to win more large-scale payment
mandates. Our ACH rails now cover 54 currencies and have the ability to
deliver to billions of endpoints including mobile wallets, while significantly
lower our cost to serve. Clients also benefit from unmatched FX versatility.
We can price virtually any currency we offer against any other, from G10
majors to frontier markets, giving them access to corridors others cannot
reach.
Our trade finance capabilities continue to attract new clients and achieve
robust growth, especially in Sub-Saharan Africa where we help bridge the trade
finance gap that constrains the growth of some of the region's most dynamic
economies. The size of the opportunity is significantly more than our balance
sheet capacity, and we are developing our syndication and primary distribution
capabilities to originate more of this important offering, connecting those
with the capital to the demand from markets.
Investing in innovation
As a regulated bank, we are disciplined in capital allocation. We invest where
we see returns and every investment is tied to revenue growth or operational
efficiency.
For example, we are developing a stablecoin proposition for faster, lower-cost
payments. This will align both with our clients needs and regulatory
requirements as they crystallise. We want to be at the forefront as this
technology develops. It has enormous potential to enhance flows in our key
markets, but we need to ensure we are working with central banks and
governmental policy aims.
In the near-term, we will invest in our core banking platform to enhance
client experience and improve processes. This will improve processes such as
client management, trading desk management, payment system integration and
onboarding times. This will enhance operational leverage which remains an
important strategic driver in our business.
Financial Performance
I am very pleased to report that our hard work has delivered improved
financial performance. The year-on-year and half-on-half income growth is the
result of the commitment of our people, in delivering our purpose and serving
our growing client population.
As mentioned earlier, Total Income grew 12% year-on-year, ahead of market
expectations. Growth was broad-based across service lines reflecting strategic
progress as we built stronger relationships with our existing clients and
onboarding new ones. Net interest income was marginally down year-on-year as
interest rate cuts in the latter half of the year took effect. This is a trend
we expect to continue into 2026.
Operating costs, excluding depreciation and amortisation, increased by 10%.
Following the completion of our strategic restructuring in early 2025, we have
successfully reshaped our cost base to support growth, reducing the number of
roles in our organisation by 20% in Q1 and pivoted investment more into client
facing activity. This demonstrated the true resilience of our business, with
colleagues exhibiting strong determination during periods of uncertainty,
delivering the overall robust result for 2025.
We have increased client-facing headcount in New York and Abu Dhabi as well as
London and Amsterdam. While this will lead to higher operating costs going
forward, our cost base is structured to deliver sustainable growth and
positive operating leverage over time.
We generated Adjusted EBITDA of £35.2m for the year-ended 31 December 2025
(2024: £30.8m). Adjusted EBITDA margin grew to 30% (2024: 29%). With our cost
base now re-baselined and our investment focus targeted on revenue growth, we
have a strong opportunity to generate further operational leverage.
Finally, we generated double-digit growth in profitability with Adjusted EPS
growing 9% to 6.8 pence per share. However, reported EPS fell 4% to 5.4p per
share, reflecting the one-off costs we needed to incur to complete our
transformation. Overall, a very pleasing set of results evidencing the value
of our purpose and the effectiveness of the strategy that supports it. As the
global landscape continues to shift, we enter 2026 with confidence and
commitment to our growth plans.
Outlook
Looking ahead to 2026, we are well-placed to build on our progress. The strong
run-rate of sustainable revenues, a robust pipeline of new clients, and
ongoing market expansion provides confidence for further growth.
While the global environment remains unpredictable, CAB Payments is more
essential than ever to an increasing part of the global community.
We are expecting to face interest rate headwinds going into next year, as
global interest rates fall, particularly in the US and UK. Overall, we are
aiming for high-teens to low-20s percentage CAGR in Total Income (excluding
Net Interest Income) over the next three years. This is together with
delivering improving operational leverage.
Our business model is also highly cash generative and we expect to generate a
significant capital surplus balancing investing for further growth as well as
a shareholder return programme for which we will lay out a framework next
year.
I wish to thank our colleagues for their unwavering commitment and support
during this pivotal and transformative year. Their talent, expertise, and
shared ambition have made this progress possible. We are well-positioned to
deliver further growth, serve our clients and deliver lasting prosperity where
it is needed most.
Neeraj Kapur
Group Chief Executive Officer
4 March 2026
Financial Review
Overall
The business has delivered revenue growth, demonstrated cost discipline
following the restructuring in the first quarter, attracted more clients, and
made broad-based strategic progress. These advances have translated into
tangible financial growth with income and profitability building throughout
the year.
While macro-economic challenges and volatility persist, we have worked to
reduce their impact through broadening the sources of income, reducing
concentrations in our business, improving our risk management tools and, most
importantly, remaining focused on supporting our clients.
Business volumes continued to increase through the year, with Wholesale and
Payment FX volumes increasing 13% year-on-year and the number of payments
processed rising 19%. Growth was broad based across existing client vintages
along with a +46 increase in transacting clients.
Income growth was driven by our Banks and Fintechs & Corporates sectors
(representing ~88% of total income) as we continue to be their partner of
choice and as we increased our reach and capability.
We also remained a key partner for IDOs, (representing ~12% of total income)
through a challenging year, which saw the impact of reducing funding levels
change how they deliver on their priorities.
Note: All amounts in the financial review section are presented in millions
(£m) as whole numbers unless otherwise stated. Percentages and totals are
calculated using underlying actual figures to one decimal place and may not
recalculate exactly from the presented amounts due to rounding.
Summary Financial Information and KPIs
Twelve Months Ended 31 December 2025 2024 YoY growth % H2 vs H1 growth %
Total Income¹ (£m) 119.0 106.4 12% 30%
Profit After Tax (£m) 13.6 14.2 (4%) 387%
Total Income (ex Net Interest Income) (£m) 87.5 74.6 17% 48%
Adjusted EBITDA¹ (£m) 35.2 30.8 14% 69%
Adjusted EBITDA margin¹ (%) 30% 29% 3% 32%
Adjusted Return on Equity (%) 11% 11% -% 111%
Earnings Per Share (pence)¹ 5.4 5.6 (4%) 389%
Adjusted Earnings Per Share (pence)¹ 6.8 6.3 9% 119%
Average total deposits (£bn) 1.5 1.4 4% (2%)
Shareholders funds (£m) 160.7 146.6 10% 7%
Number of Active Clients 592 546 8% 3%
Wholesale and Payment FX Volume (£bn) 41.9 37.2 13% 11%
Capital Expenditure (£m) 8.7 15.0 (42%) 49%
With the opening of new offices in the US and Abu Dhabi, together with
existing offices in the UK and Europe, and plans to deepen the on-the-ground
presence in Africa and elsewhere, we are well placed to continue to grow our
core FX and Payments proposition, underpinned by our banking licence.
We delivered costs to plan which included executing a restructuring in Q1. We
have delivered income growth whilst keeping staff costs broadly flat year on
year, excluding variable pay, as guided.
While non‑staff costs increased due to market‑wide inflation and higher
transactional volumes, strong income performance and an improved cost profile
delivered higher Adjusted EBITDA and margins, with a half‑on‑half marginal
gain of +58%. We acknowledge that there is scope for significant improvement
in Adjusted EBITDA margin and our Cost-Income ratio and this will be of strong
focus going forward.
Total Income by product
£m 2025 2024 YoY growth % H1 2025 H2 2025 H2 vs H1 growth %
Wholesale FX 48.7 39.0 25 % 17.7 31.0 75 %
Payments 29.5 29.5 - % 13.7 15.8 15 %
of which
Payments FX 14.0 14.8 (5) % 6.2 7.8 26 %
Other Payments 15.5 14.7 5 % 7.5 8.0 7 %
Total Transactional income 78.2 68.5 14 % 31.4 46.8 49 %
Banking 40.8 37.9 8 % 20.4 20.4 - %
of which
Net Interest Income 31.5 31.8 (1) % 16.5 15.0 (9) %
Trade finance and other income 9.3 6.1 52 % 3.9 5.4 38 %
Total Income 119.0 106.4 12 % 51.8 67.2 30 %
¹ See alternative performance measures for definition / Page 82.
Wholesale FX and Payment FX volumes and Take Rates
Combined Wholesale and Payment FX 2025 2024 YoY growth % H1 2025 H2 2025 H2 vs H1 growth %
Emerging Market Currencies
Volumes £bn 13.5 13.5 - % 6.3 7.3 16%
Take Rates 0.31% 0.29% 7% 0.24% 0.38% 58%
G10 Currencies
Volumes £bn 28.4 23.7 20% 13.6 14.8 9%
Take Rates 0.07% 0.06% 17% 0.06% 0.07% 17%
Wholesale FX Income increased to £49m (+25% year-on-year) driven by a
combination of volume growth and take rate growth, particularly in the second
half of the year. Income benefitted from growth across every vintage of
clients: newly onboarded, the scaling of 2024 onboarded clients and mature
clients.
Our strategy of supporting prosperity in the markets we serve continued to
deliver tangible value in 2025, underpinned by increasingly close working
relationships with Central Banks.
Momentum accelerated through the year, with half‑on‑half income rising
£13m (+75%), driven by increases in both volumes and take rates. Performance
was further supported by some episodic dislocation causing take rate
volatility in a small number of our periphery markets (<£2m) partly
offsetting the short lived market dislocation observed in Q1-24.
Payment FX Income was 5% down year-on-year, with a 29% increase in Payment FX
volumes more than offset with a fall in take rate.
The second half of the year delivered income of £8m, up 26% half-on-half,
reflecting an increase in Payment FX volumes partially offset with marginally
lower take rates.
Other payments revenue, which includes correspondent banking and income from
pension payments, was up 5% year-on-year and 7% half-on-half. In the period we
processed over 1.2m payments through our platform driven by increased activity
and the onboarding of new correspondent banking clients. Since the year end we
have also added a new global bank to our USD and EUR clearing partners, adding
to our ability to serve more clients and markets.
Banking income of £41m increased 8% year-on-year driven by the controlled
growth of Trade Finance offset by the impact of interest rate reductions on
net interest income towards the end of the year.
Net Interest Income from cash management was £32m, down 1% year-on-year,
reflecting lower global interest rates, partly offset by a favourable shift
towards call deposits. Income declined 9% half-on-half driven by falling base
rates and the cost of the interest rate risk management programme executed
in H2 2025. Average deposits for the 12 months to 31 December 2025 stood at
£1,451m, up 4% versus prior year (2024: £1,400m), reflecting a steady
underlying growth as clients expand their use of our integrated transactional
banking services.
Trade Finance and Other Income grew by 52% year-on-year to £9m, driven
primarily by the growth in trade finance balances and a c.£0.7m gain on the
sale of a portion of our bond portfolio. During the year we also successfully
sold or risk participated Trade Finance exposures of c.£92m for a small net
gain. The exposures in the portfolio are all under one year and the portfolio
has an average duration of four months as at the year end. We are not looking
to actively grow this book much further, however our strategy is to start
syndicating transactions. This will magnify the impact we can have on the
economies we serve without requiring material additional capital from our
balance sheet.
Total Income by Client Segment (£m)
Client Type 2025 2024 YoY growth % H1 2025 H2 2025 H2 vs H1 growth %
(£m) (£m) (£m) (£m)
Banks¹ 71.9 62.4 15 % 33.3 38.6 16 %
Fintechs & Corporates¹ 33.2 28.8 15 % 12.5 20.7 66 %
IDOs 13.9 15.2 (9) % 5.9 8.0 36 %
Total 119.0 106.4 12 % 51.7 67.3 30 %
¹ During the period we consolidated previous segments of EMFIs and Major
Market Banks (MMBs) into a single 'Banks' segment and changed "NBFI and
Fintechs" to "Fintechs and Corporates" which better reflects how we manage the
business and our go-to-market strategy.
Banks represent 60% of total income and remains our largest segment generating
£71.9m of income in 2025. This is up 15% year-on-year benefitting from
£2.4bn higher Wholesale and Payment FX volumes, a marginal increase in take
rates and a higher average Trade Finance balance.
Fintechs & Corporates accounted for 28% of total income, generating £33m,
up 15% year-on-year. Growth was driven by a £0.7m uplift from higher
utilisation of working capital facilities which supported a £2.8bn (up 52%)
increase in Wholesale and Payment FX volumes. This more than offset a
year-on-year reduction in take rates resulting from the short-lived market
dislocation in Q1-24 which was partially mitigated by episodic dislocations in
a small number of our periphery markets in H2 2025.
IDOs accounted for 12% of income, with earnings declining 9% year-on-year to
£14m, in line with expectations following the reduction in global aid flows.
However, performance strengthened significantly in H2, with income up 36%, as
we remained closely engaged with our clients, reflecting margin expansion from
recent lows and some volume growth.
Total Income by Region (£m)
Geography 2025 2024 YoY growth H1 2025 H2 2025 H2 vs H1 growth %
(by client domicile) (£m) (£m) % (£m) (£m)
Americas 41.3 37.6 10 % 20.5 20.8 1 %
UK 29.4 28.7 2 % 11.2 18.2 63 %
Europe 6.1 5.9 3 % 2.4 3.7 54 %
Africa 36.0 27.6 30 % 14.6 21.4 47 %
Middle-East 1.1 1.4 (21) % 0.5 0.6 20 %
Asia 5.1 5.2 (2) % 2.6 2.5 (4) %
Total 119.0 106.4 12 % 51.8 67.2 30 %
The above table shows the breakdown of Total income by client domicile. Our
specialised business has attracted clients from all over the world as they
seek to access hard to reach markets and to connect to the global financial
system. While over 60% of transactional revenue has an African nexus, the
clients we engage with can be located in the continent of Africa or elsewhere
in the world.
The Americas (North America, LATAM and the Caribbean) represents c.35% of our
income currently and with Banks representing the largest segment within the
region. We have invested in building further momentum in this region following
the opening of our New York office in H2 2025. Year-on-year income grew 10%
benefitting from growth in central bank activity and an increase in mix
towards call deposits. Half-on-half growth was moderated because of net
interest income headwinds.
Africa is our second largest region, with c.30% of income, mostly from Banks.
growing at 30% YoY. This reflects our continued focus to serve Africa and
build out a leading liquidity network across the continent. We are looking to
invest further in our footprint in Africa with more, on the ground presence in
2026.
UK represents c.25% of our income growing 63% half-on-half largely driven by a
15% increase in FX volumes and a 5bps increase in FX margins mostly from our
Fintechs and Corporates segment which represents over 80% of income in this
region.
Europe and MENA are newer investments with the Amsterdam office, after a
slower than expected start, now transacting with clients and the Abu Dhabi
office scaling up following the licence approval in January 2026. We
acknowledge that our European Office (CAB Europe) has taken longer than we
would have liked towards monetisation and scale, but we are now seeing
momentum building.
Expenses (rounded to the nearest £m)
Category 2025 2024 YoY growth % H2 vs H1 growth
(£m) (£m) %
Staff expenses (excluding variable compensation) 41.7 41.2 1 % 5 %
Variable compensation 8.7 4.5 93 % 163 %
Total Staff Costs 50.4 45.7 10 % 22 %
Cost of Sales 6.6 5.7 16 % 20 %
Other operating expenses 26.9 24.8 8 % 7 %
Total operating expenses (excl. D&A) 83.9 76.2 10 % 17 %
Depreciation and amortisation 10.6 8.5 25 % 4 %
Total operating expenses before non-underlying items 94.5 84.7 12 % 15 %
Non-underlying items 4.7 3.7 27 % (88) %
Total operating expenses after non-underlying items 99.2 88.4 12 % 6 %
FTE (spot) 366 421 (13) % 7 %
Transactions ('000) 1,163 976 19 % 9%
STP Rate 94% 93% 1 %
Total reported operating expenses (excluding depreciation and amortisation)
increased by 10% year-on-year to £84m (17% half-on-half). This reflected the
normalisation of variable compensation, growth in cost of sales and increases
in other operating costs largely supporting the expansion of the Bank's global
footprint.
We demonstrated good cost control including executing the restructuring action
in Q1, driving operational efficiency and working to absorb inflationary
pressures. Underlying operating costs (excluding depreciation and
amortisation) increased by 3% year-on-year when removing the variable pay
uplift, variable cost of sales and the one off £0.6m VAT refund recognised in
H1 2024.
FTE at the end of 2025 was 366, down 13% on 2024 reflecting the execution of
the strategic restructuring exercise and controlled investment, focused on
building our product capability and expanding the depth and reach of our
client facing capability.
Total Staff costs excluding variable compensation costs were maintained
broadly flat year on year, in line with previous guidance. Total staff costs
were up 10% year-on-year, driven mostly by the normalisation of variable
compensation in the period reflecting the improved performance and execution
of the turnaround strategy.
Cost of sales increased 16% year-on-year largely reflecting the growth in the
number of transactions processed, up 19%, along with the credit guarantee
insurance costs for the Trade Finance risk participation.
Other operating expenses increased to £27m, up 8% year-on-year, largely
reflecting the combination of inflationary costs, investment in product
enhancements such as Trade Finance credit risk participation, formation of the
Bank's balance sheet hedging capabilities and the legal and travel spend
required to set up new licences in new regions. Furthermore, in 2024, we
received a VAT refund of £0.6m which did not reoccur in 2025.
Depreciation and amortisation increased 25% year on year to £10.6m,
reflecting the higher capital expenditure from 2024 which started to amortise
in 2025.
Non-underlying items (formerly referred to as adjusting items) largely
reflects restructuring costs associated with the redundancy programme
conducted in the first quarter of the year which were in line with previous
guidance, along with the cost of setting up new international entities.
Profitability
As a result of a 12% growth in revenue, whilst controlling cost growth, the
business generated an Adjusted EBITDA of £35.2m (2024: £30.8m) growing 14%
year on year. The Group also generated Adjusted PAT of £17.4m up 9% versus
2024 (2024: £16.0m) with depreciation and amortisation increasing reflecting
higher capex in the prior year.
Statutory PAT was down 4% reflecting exceptional costs (£4.7m) associated
with the restructuring programme we conducted in the first quarter and higher
tax YoY reflecting prior year adjustments in 2024 and 2025.
Taxation
The effective tax rate for the year was 27% (2024: 19%). The Group incurred a
total tax charge of £5.0m compared to £3.4m in 2024, reflecting a
combination of the improvement in profitability and an adjustment in respect
of prior year. Underlying effective tax rate in 2025, excluding prior year
adjustments, remains in line with 2024 at just under 25%.
Balance sheet
The Group Balance Sheet remains well capitalised, highly liquid and short
dated with total shareholders' funds increasing 10% year-on-year.
Total Deposits at the balance sheet date decreased by 9% to £1.4bn (2024:
£1.6bn).
The spot decrease in balances is largely related to movements around the 2024
balance sheet date. Within deposits there has been a trend of increasing call
account balances, up 18% year-on-year and reducing term deposits. During the
year we have developed a new A+ rated deposit product as we look to build
options for clients to meet their deposits needs.
Average deposits across the year are up 4% year-on-year. Average deposits were
up largely due to the growth in deposits from Banks, as we continue to expand
our correspondent banking capabilities, and from Fintechs and Corporates as we
provided Safeguarded deposit services.
Average Deposits (£m) 2025 2024 YoY growth % H2 vs H1 growth
(£m) (£m) %
Call Deposits 773 611 27 % - %
Fixed Term Deposits 678 789 (14) % (5) %
Total Deposits 1,451 1,400 4 % (2) %
The Group has repositioned its asset strategy through the year with the aim to
reduce risk and P&L volatility, and to broadly match the currency of
assets and liabilities.
Treasury assets composition has changed through the year, however we have
reformed the Bank's low‑risk approach to balance sheet management. With most
deposits received in USD, the Bank has reduced its cross-currency exposure by
reducing both cash held at the Bank of England and Money Market Funds and
reallocated funds to debt securities (up 175%).
Debt securities increased to £678m (2024: £246m), with holdings largely in
government and other high-grade investment securities. This reflects our
strategy to allocate liquidity to high quality (all AA rated or better), HQLA
(short duration) eligible, short tenure assets in the currency matching the
underlying deposits.
The Bank significantly reduced the Group's exposure to interest rate movements
by deploying an interest rate risk management policy. This resulted in some
assets, previously held to hedge rate movements, being sold resulting in a one
off gain on sale of c.£0.7m. At the year‑end, the Group assessed its
interest rate sensitivity at just under £2m for a 1% parallel shock to
interest rates, down from under £5m in the prior year.
Trade Finance lending is up 50% year-on-year to £270m as we grew lending to
around our appetite levels. An enhanced 'originate to distribute' model was
launched in the year and c.£92m of trade assets were successfully sold or
risk participated for a small net gain. The next stage of this business will
be to increase the distribution volumes through continued bi-lateral sales and
syndicating transactions.
Balance Sheet
2025 2024 YoY growth %
(£m) (£m)
Cash at Central Banks 257.9 584.7 (56) %
Money Market Fund 218.2 488.2 (55) %
Loans and advances to banks 129.9 185.6 (30) %
Debt Securities 677.5 246.0 175 %
Non-HQLA Assets 5.1 0.2 2450 %
Treasury Assets 1,288.6 1,504.7 (14) %
Trade Finance 269.8 179.7 50 %
Working Capital 21.5 32.6 (34) %
Right of use assets 15.7 17.8 (12) %
Intangible Assets 31.2 30.6 2 %
Fixed and Other Assets 32.9 39.4 (16) %
Total Assets 1,659.7 1,804.8 (8) %
Customer Deposits - Current 915.6 775.8 18 %
Customer Deposits - Term 520.9 809.2 (36) %
Customer Deposits 1,436.5 1,585.0 (9) %
Other Liabilities 62.5 73.2 (15) %
Shareholders Funds 160.7 146.6 10 %
Total Liabilities + Equity 1,659.7 1,804.8 (8) %
Capital Expenditure
Capex for the year stood at £8.7m, broadly in line with guidance, with over
70% of investment allocated towards revenue-generating capabilities. Key
projects include the continued investment in our new payment channels such as
mobile wallet build and ACH build-out. We are also investing into our product
capability as well as international expansion as we enhance our presence in
key regions.
Capital, Liquidity and Investment
The Group continues to be well capitalised, highly liquid, short dated and
focused on transactional activity with >65% of revenues driven by
transactional FX and Payments activities with the remainder driven by Banking
products.
As at 31 December 2025, only 22% of deposits were allocated towards short term
trade and working capital lending with the remainder placed in High Quality
Liquid Assets with Central Banks (HQLA). To put that into context, a typical
bank in the UK would lend out at least three times this proportion of
deposits¹.
Proforma CET1 ratio² increased to 22.1% (2024: 19.2%) reflecting the
accumulated profits offset by a controlled increase in the trade finance
portfolio Total proforma CET1 Capital stood at £129.3m (2024: £116.0m) an
increase of 12% retaining a £41.1m surplus above the Overall Capital
Requirement.
Liquidity metrics remain strong with both LCR and NSFR well above regulatory
minimums at 123% and 148% respectively.
1 Defined as a basket of comparable transaction banks: Barclays, Lloyds,
NatWest, Standard Chartered, Standard Bank, Commerzbank and HSBC as at 31
December 2024.
2 Proforma CET1 ratio includes 2025 audited profits and pillar 1
operational risk uplift. Regulatory CET1 ratio as at 31 December 2025 is
19.9% (2024: £19.7%)
Dividend
No dividends have been declared in 2025 (2024: nil). The Group does not
currently have a dividend policy.
Outlook
Following a strong performance in 2025, the Group has started trading
positively in 2026 and expects its strategy to continue delivering more
diversified and sustainable revenue growth. CAB operates in markets that
typically grow faster than global averages and are becoming increasingly
central to world-wide flows. Expanding client coverage, market penetration and
product depth was key to 2025 performance and will continue to be our focus
over the medium-term.
The Group therefore believes it is well placed to deliver Total Income
excluding Net Interest Income growing at a high-teens to low-20s percentage
CAGR in Total Income over the next three years. In the near term, lower US
interest rates are expected to create headwinds for Net Interest Income.
The business is expected to deliver continued positive operating leverage
supporting a structural improvement in cost-income ratio over time. We expect
additional investment in client-facing teams and network to be partially
offset by efficiency gains from automation and process improvements.
The Group expects Capital Expenditure to increase in 2026 while it builds a
future-ready operating platform as it enters the next phase of growth.
Our business model is structurally highly cash generative. With the Group now
operating near the upper end of its on‑balance‑sheet lending appetite, we
believe that the Group will generate significant surplus capital over the next
3 years leading to capacity for investment in growth as well as a potential
shareholder return programme, a framework for which will be laid out at the
time of the 2026 results.
James Hopkinson
Chief Financial Officer
Principal Risks and Uncertainties
Effective risk management is critical to realising our strategy. We have an
established risk management framework to manage and mitigate the various risks
that we face.
As at 31 December 2025 our principal risks consisted of:
Current Context Mitigants and other considerations
1. Business risk
Risk Description • The Group's business model and operations rely on the continued • The Board and Management periodically:
relationships with a diversified network of counterparties, liquidity
The risks to the Group arising from: providers and partner banks for clearing USD, GBP and EUR. - Review and update the strategic plan, budgets, targets, emerging
opportunities, and threats.
• the broader risk of the Group's business model or strategy proving • The Group provides access to emerging markets, with a level of
inadequate due to macroeconomics, geopolitical, industry, regulatory, concentration to Sub-Saharan Africa. Significant changes to our partner - Track and manage, through governance, a range of metrics and early warning
competitive environment or other factors; or network or key markets (e.g. the risk of market dislocations, general access, indicators to highlight emerging risks to performance; these continue to be
regulatory, economic, or geopolitical conditions) would have a corresponding developed and enhanced.
• adverse events and media coverage that could negatively impact the impact on the Group's business, operations, financial performance and
Group's name and reputation thereby impacting its ability to achieve its reputation. • The Group has a dedicated Network and Partnerships Function, who
strategic objectives.
develop and manage our key local relationships; actions continue to be taken
• The Group's business model and operations rely on the continued to ensure these are adequately diversified including key currencies such as
relationships with a diversified network of counterparties and partners USD and GBP. This function also tracks and reports regulatory changes and
including liquidity providers. geo-political issues in these markets.
Potential events may include: • The Group has a strategic risk register which tracks the top risks and
the corresponding actions planned and underway to mitigate these. This is
• Adjustments in the nature of our partner networks impacting access to reported periodically to the Risk Committee and Executive Risk Committee.
local liquidity or clearing services. Structural changes to markets that
result in the removal or narrowing of margins and/or access to preferential • The Group has a medium-term strategy in place to continue diversifying
local market currency rates. revenues across geographies, clients and products whilst investing in its
sales team.
• Changes to local economies including market structure (e.g.
regulatory/central bank monetary actions):
- Economic or political events (e.g. changes in government).
- Translation risk associated with significant strengthening in GBP
relative to USD.
2. Financial crime risk
Risk Descriptions • Foreign Exchange (FX) remains the dominant product, utilised by over • To effectively mitigate risks, the Group enforces rigorous onboarding
90% of clients. However, correspondent banking and payment services are core standards and comprehensive due diligence for correspondent banking, supported
The risk associated with criminal activity in the form of money laundering, offerings. AML and sanctions risks remain most pronounced, within this area, by strong governance structures and dedicated client risk approval committees.
terrorist financing, bribery and corruption, sanctions, tax evasion and fraud. and Trade Finance, accounting for the majority of Suspicious Activity Reports
submitted to the NCA. • A robust country risk framework mitigates the Group's exposure to
high-risk countries. This framework includes complete prohibitions of some
• The Group delivers services to clients across global jurisdictions, countries and detailed restrictions on others.
including Africa, the Americas and Caribbean, the Middle East, the USA,
Canada, and Europe. Historically, client concentration was weighted toward • Screening and monitoring controls enforce the framework, and the
higher-risk countries; however, continued trends show increased payment flows Group's employees have a strong awareness and understanding of the legal and
from low-risk to higher-risk jurisdictions. Despite this, new clients in regulatory environment in which they operate, including the relevant financial
higher risk regions continued to be onboarded in 2025, while strategic crime prevention provisions.
expansion into the Americas and the UAE is underway to reduce reliance on
African markets. • The Group continues its investment programme in anti-financial crime
technology, focusing on advanced analytics and rule-set optimisation.
• In 2025 there was no significant change in the distribution of Client Following the successful implementation of a new transaction monitoring system
types within CAB's portfolio and Financial Institutions remain the largest and screening upgrades in 2024, Phase 2 enhancements were delivered in 2025,
segment of CAB's Client portfolio. introducing machine learning capabilities and improved alert handling.
Additional upgrades to sanctions screening and real-time monitoring are
• CAB specialises in segments including Fintechs, Money Service underway to further strengthen detection and response.
Businesses (MSB), and charities, but also includes segments such as financial
institutions, Central Banks and supranational organisations. • Regular training is delivered to ensure standards are continuously
maintained.
• The Group's organisational structure and control environment continue
to be assessed as low due to no legacy financial crime issues, and no major • A dedicated Risk and Compliance Function provides oversight and
control failures. The introduction of the UAE subsidiary may impact this undertakes thematic assurance activity to identify potential gaps and issues.
operating risk, although the Group's licensed subsidiaries operate in a
simple, non-complex structure and are physically located in jurisdictions with
well established regulatory standards.
• Regulatory oversight and scrutiny are generally lower for many
Fintechs and MSBs. Continued observed regulatory penalties in 2025, related to
control deficiencies within MSBs, highlight persistent challenges in
mitigating financial crime risk in this sector, supporting their
classification as higher risk. Similarly, financial institutions operating in
high-risk jurisdictions are assessed as higher risk due to the inherent
country-level exposure, which may present additional challenge to the Group.
3. Operational risk
Risk Description • The Group relies extensively on the use of technology, including the • The Group is Cyber Essentials and ISO 27001 accredited. Additionally,
inter-relationship between multiple third-party services, which is central to the Group continues to enhance its operational resilience efforts with a key
The risk of loss or other non-financial impact, resulting from inadequate or the processing and its operating environment. System resiliency coupled with focus on critical third-party resilience testing.
failed internal processes, people and systems, or from external events. the growing sophistication of cyber-attacks is consistently under review.
• The Group deploys several attraction and retention strategies
• Resource capacity and capability impact all risk types, these are throughout the employee lifecycle, including hybrid-working and competitive
monitored frequently to ensure staffing levels reflect the size and complexity employee benefits.
of the Group.
• Process and control automation is proactively considered across the
• The Group relies on a combination of manual and automated processes. Group, acknowledging that not all processes can be automated but regular
Specific clients have bespoke processes that are more prone to human errors. process review cycles support in ensuring processes and procedures are
The Group is acutely aware that a technology incident could result in manual consistently updated and maintained.
intervention as part of its recovery efforts.
4. Credit risk
Risk Description • Credit risk arises inherently from the Group's core banking, • Credit risk remains a key area of focus for the Group, given its
financing, and treasury activities. It represents the potential for financial central role in the Group's banking, financing, and treasury activities.
The risk of financial loss arising from a borrower's or counterparty's failure loss should counterparties fail to meet their contractual obligations in full
or inability to meet their financial obligations in accordance with and on time. • The Group's risk appetite thresholds are designed in alignment with
contractual terms.
regulatory requirements and are informed by the outcomes of the Internal
• The Group's exposure to credit risk primarily stems from its lending Capital Adequacy Assessment Process (ICAAP) and internal risk assessments.
and trade finance operations, including working capital overdrafts, letters of
credit, guarantees, and other customer financing products. These exposures are • A well-established Credit Risk Policy defines portfolio-level exposure
managed through robust credit approval processes, ongoing monitoring, and limits and a maximum individual counterparty exposure framework, ensuring
clearly defined risk appetite parameters. appropriate diversification and concentration control.
• Counterparty credit risk also emerges from the Group's foreign • The Credit & Lifecycle Risk Committee provides oversight at both
exchange, payment, and derivative transactions, where counterparties may be the individual counterparty and portfolio levels, ensuring that exposures
unable or unwilling to fulfil their financial or collateral obligations as remain within approved risk appetite and policy parameters.
they fall due. Such exposures are mitigated through the use of collateral
management frameworks, netting agreements, and credit support annexes (CSAs) • Comprehensive credit assessment, approval, and ongoing monitoring
where appropriate. frameworks are in place to manage and mitigate exposures in line with the
Group's credit management objectives and enterprise risk framework.
• In addition, treasury and liquidity management activities contribute
to credit risk through the placement of surplus funds with financial • Counterparty credit risk arising from foreign exchange and derivative
institutions and investments in high-quality liquid assets (HQLA) and money transactions is mitigated through the use of ISDA Master Agreements and CSAs,
market instruments. These exposures are controlled by adhering to internal where appropriate, to ensure effective collateralisation and reduce potential
counterparty limits, minimum credit rating thresholds, and concentration risk counterparty exposure.
metrics.
• Overall, the Group maintains a balanced credit risk profile, supported
by sound governance, regular stress testing, and alignment with the Group's
overarching risk appetite and capital management framework.
5. Market risk
Risk Description • The Group's market risk exposure occurs primarily through FX • An assessment of market risk drivers is conducted as part of the
volatility and IRRBB. ICAAP, and to assess BAU and stressed market risk.
The risk of losses occurring from adverse value movements of the Group's
assets and liabilities; principally relating to FX and interest rate • The economic and financial market uncertainties remain elevated. • Market Risk exposure limits are staggered, to constrain typical market
fluctuations. Disruptive adjustment to interest rate levels, deteriorating trade or risk exposure. The Group primarily trades in the FX spot market and risk
geopolitical tensions could have implications for FX rates and the value of appetite limits are set and monitored at both an aggregate and
the Group's Nostro balances. Alternatively, a decline in interest rates may currency level.
compress net interest margin across the business.
• Defensive positions are typically taken to the extent that markets
• Adverse changes in FX rates can impact capital ratios given elements exhibit increased market risk events, such as during national elections.
of the risk-weighted assets exposures are denominated in foreign currencies.
• Interest rate risk in the banking book (IRRBB) is primarily driven by
• Failure to account for foreign currency movements could result in an mismatches between the profile of client deposits, capital, investments for
adverse impact on the Group's regulatory capital and leverage ratios. cash management purposes, and lending. The Group manages IRRBB through
strategies employed to mitigate risks to net interest income and economic
value.
6. Regulatory and compliance risk
Risk Description • As the Group continues to grow in terms of increasing size and • Regulatory Horizon Scanning: Ongoing monitoring of upcoming UK and
complexity it brings with it an increasingly diverse legislative and international regulatory developments to anticipate and prepare for changes.
The risk arising from non-compliance with laws and regulations governing regulatory landscape and potentially increasing the risks of legal or
financial services institutions in the markets in which we operate. regulatory sanctions, material financial loss and/or reputational damage in • Regulatory Impact Assessments: Conducting impact analysis for new
the markets in which we operate. regulations to identify operational, financial, and compliance implications.
• Timely Regulatory Engagement: Prompt and comprehensive responses to
all regulatory requests and inquiries.
• Market Entry Compliance: Verification that the Group holds all
necessary licenses and permissions before operating in any jurisdiction.
• Partnership Due Diligence: Collaboration with local providers that are
regulated entities or hold appropriate local licenses to ensure compliance and
reduce risk.
• Legal Assurance for Expansion: Engagement of third-party legal counsel
for new territorial expansions to confirm adherence to local laws and
regulatory requirements.
• Regulatory Updates Communication: Issuing regular compliance bulletins
to staff on new or changing regulations.
• Regular Compliance Audits: Performing periodic thematic reviews to
ensure adherence to regulatory requirements.
• Executive Reporting: Including regulatory risk metrics and compliance
status in ExCo-level reporting.
7. Capital adequacy risk
Risk Description • The Group's capital ratios can be affected by various business • The Group has robustly defined capital adequacy thresholds,
activities and the failure to meet prudential capital requirements, internal constructed in reference to regulatory requirements and maintains capital
The risk of the Group having insufficient quality or quantity of capital, to targets and/or to support the Group's strategic plans. ratios in excess of these.
meet its regulatory capital requirements and internal thresholds to cover risk
exposures and withstand a severe stress as identified as part of the ICAAP. • The key risk drivers with capital implications are credit risk, market • The Group produces an ICAAP at least once each calendar year.
risk and operational risk, each of which is addressed within its relevant Challenge and oversight of the ICAAP occurs at the Asset & Liability Risk
section. Committee and the Risk Committee before approval by the Board.
• Day-to-day capital risk exposure is managed by the Treasury function
with oversight from the Asset & Liability Risk Committee and the Group
Treasury Committee, who monitor and manage capital risk in line with the
Group's capital management objectives, capital plan and risk frameworks.
• If the Group were to encounter a significant stress on capital
resources, a Recovery Plan is maintained which includes options to ensure it
can remain sufficiently capitalised to remain viable. Recovery Plan metrics
are regularly monitored and reported against. The Group's Pillar 3 disclosures
contain a comprehensive assessment of its capital requirements and resources
and are published separately on the Group's website.
8. Liquidity and funding risk
Risk Description • The Group's liquidity ratios (i.e. LCR and Net Stable Funding Ratio • Funding and liquidity risks are managed within a comprehensive risk
(NSFR)) can be affected by various business activities, either idiosyncratic framework in reference to regulatory requirements and internal thresholds to
The risk the Group cannot meet its contractual or contingent obligations in a or market-wide, that could impact prudential liquidity requirements and ensure there is no significant risk that liabilities cannot be met as they
timely manner as they fall due. Funding risk is the risk that the Group cannot corresponding business activities, and investor or depositor confidence. fall due.
maintain access to a sufficient stable funding base to maintain its liquidity.
• The key liquidity risk drivers are depositor outflows, and intraday • The Group produces an ILAAP at least once per calendar year. Challenge
liquidity requirements. and oversight of the ILAAP occurs at the Asset & Liability Risk Committee
and the Risk Committee before approval by the Board.
• The primary metrics used to monitor and assess the adequacy of
liquidity are the Overall Liquidity Adequacy Rule (OLAR), the LCR and NSFR.
• Day-to-day liquidity risk exposure is managed by the Treasury function
with oversight from the Asset & Liability Risk Committee.
• Treasury conducts regular and comprehensive liquidity stress testing,
including reverse stress testing, to ensure that the liquidity position
remains within the Board's appetite.
9. Conduct risk
Risk Description • As the Group continues to operate in complex markets and deliver • Integration of Conduct Risk in Product Governance: All new products
services to a diverse client base, there is an ongoing risk that actions, undergo a formal approval process that includes an assessment of conduct risk
The risk that the conduct of the Group and its staff, towards clients (or in processes, or products originating within the Group could lead to client to ensure suitability and fair client outcomes.
the markets in which it operates), leads to unfair or inappropriate client detriment. Conduct risk may arise through several channels, including:
outcomes and results in reputational damage and/or financial loss.
• Robust Complaints Management Framework: Complaints are systematically
• Product design that fails to meet client needs or expectations; logged, thoroughly investigated, and resolved with documented responses to
maintain transparency and accountability.
• Inappropriate sales practices that do not align with regulatory or
market standards; • Gifts and Hospitality Controls: A formal Gifts and Hospitality Policy
is in place, requiring prior approval and mandatory logging of all instances
• Poor complaint handling, particularly where the Group has acted to prevent conflicts of interest.
improperly towards clients;
• Mandatory Conduct and Ethics Training: All employees complete annual
• Behaviour or practices that fall short of market integrity or training focused on conduct, ethics, and cultural standards to reinforce
regulatory requirements; and expected behaviours and regulatory compliance.
• Such failures could result in unfair or inappropriate client outcomes, • Executive-level reporting: Including conduct risk metrics and thematic
leading to reputational damage, regulatory scrutiny, and potential financial reviews in regular ExCo-level updates.
loss.
• Conduct Risk MI (Management Information): Tracking indicators such as
complaints trends, client detriment cases, and breaches.
• Whistleblowing Framework: Strengthening anonymous reporting channels
and ensure staff confidence in escalation processes.
• Communication monitoring: surveillance of electronic communications
(emails, chats, voice recordings) to ensure compliance with conduct standards.
Financial Statements
Consolidated Statement of Profit or Loss
2025 2024
Note £'000 £'000
Interest income 3 55,788 58,857
Interest expense 3 (29,779) (38,403)
Net interest income 26,009 20,454
Gain on money market funds 14,688 16,070
Net loss on financial assets and financial liabilities mandatorily held at 4 (1,616) (247)
fair value through profit or loss
Fees and commission income 5 16,488 15,745
Net foreign exchange gain 6 62,685 53,803
Other operating income 735 616
Total income 118,989 106,441
Operating expenses before non-underlying items 7 (94,523) (84,659)
Non-underlying items 7a (4,674) (3,741)
Operating expenses after non-underlying items (99,197) (88,400)
Other finance costs 3 (1,384) (897)
Impairment reversal on financial assets at amortised cost 113 450
Profit before tax 18,521 17,594
Tax expense 8 (4,965) (3,382)
Profit for the year 13,556 14,212
Profit for the financial year arises from continuing operations and is
attributable to the owners of the parent.
Earnings per share 2025 2024
pence pence
Basic earnings per share 28 5.4 5.6
Diluted earnings per share 5.2 5.3
Earnings per share relate entirely to continuing operations.
Consolidated Statement of Other Comprehensive Income
2025 2024
£'000 £'000
Profit for the year 13,556 14,212
Other comprehensive income for the year:
Items that may be reclassified subsequently to profit or loss:
Foreign exchange (losses)/gains on translation of foreign operations (53) 4
Cash flow hedge reserve 12 (244) -
Movement in investment in debt securities at fair value through other 14 73 -
comprehensive income
Items that will not be reclassified subsequently to profit or loss:
Movement in investment revaluation reserve for equity instruments at fair 98 20
value through other comprehensive income
Income tax relating to these items 19 (24) (5)
Other comprehensive (loss)/income net of tax (150) 19
Total comprehensive income 13,406 14,231
Consolidated Statement of Financial Position
As at As at
31 December 2025 31 December 2024
Note £'000 £'000
Assets
Cash and balances at central banks 9 257,867 584,679
Money market funds 10 218,157 488,197
Loans and advances on demand to banks 11 129,946 185,559
Investment in debt securities at amortised cost 13 234,790 246,021
Investment in debt securities at fair value through OCI 14 442,751 -
Other loans and advances to banks 11 274,956 180,084
Other loans and advances to non-banks 11 21,521 32,596
Unsettled transactions 8,900 10,866
Derivative financial assets 12 489 4,884
Investment in equity securities 679 553
Other assets¹ 15 9,614 9,944
Current tax asset¹ 8,839 9,397
Accrued income 2,033 925
Property, plant and equipment 16 2,299 2,781
Right of use assets 17 15,713 17,754
Intangible assets 18 31,170 30,605
Total assets 1,659,724 1,804,845
Liabilities
Customer accounts 20 1,436,533 1,585,000
Derivative financial liabilities 12 1,384 539
Unsettled transactions 20,772 35,173
Other liabilities 4,843 5,967
Accruals 13,451 10,380
Lease liabilities 17 19,037 18,069
Deferred tax liability 19 928 1,217
Provisions 21 2,054 1,949
Total liabilities 1,499,002 1,658,294
Equity
Called up share capital 22 85 85
Treasury shares reserve (264) (244)
Retained earnings 161,065 146,724
Investment revaluation reserve 200 126
Cash flow hedge reserve 12 (244) -
Debt securities revaluation reserve 14 73 -
Foreign currency translation reserve (193) (140)
Shareholders' funds 160,722 146,551
Total liabilities and equity 1,659,724 1,804,845
(¹) Additional disclosure has been made in respect of current income tax to
present it separately to Other assets. Refer to Note 15 for further
information.
Company registration number - 09659405. The Board of Directors approved and
authorised for issue the consolidated financial statements on 4 March 2026.
Signed on behalf of the Board by:
N Kapur J Hopkinson
Group Chief Executive Officer Group Chief Finance Officer
Consolidated Statement of Changes in Equity
Share capital Treasury shares reserve Retained earnings Investment revaluation reserve Debt securities revaluation reserve Cash flow hedge reserve Foreign currency translation reserve Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance at 1 January 2025 85 (244) 146,724 126 - - (140) 146,551
Profit for the year - - 13,556 - - - - 13,556
Other comprehensive income:
Foreign exchange gain on translation of foreign operations - - - - - - (53) (53)
Movement in investment revaluation reserve for equity instruments at fair - - - 98 - - - 98
value through other comprehensive income
Cash flow hedge reserve (Note 12) - - - - - (244) - (244)
Movement in investment in debt securities at fair value through other - - - - 73 - - 73
comprehensive income (Note 14)
Income tax relating to these items (Note 19) - - - (24) - - - (24)
Other comprehensive income net of tax - - - 74 73 (244) (53) (150)
Total comprehensive income - - 13,556 74 73 (244) (53) 13,406
Transactions with owners in their capacity as owners:
Share-based payment expense - - 615 - - - - 615
Deferred tax on share based payment expense - - 170 - - - - 170
Acquisition of treasury shares by EBT - (20) - - - - - (20)
Total - (20) 785 - - - - 765
Balance at 31 December 2025 85 (264) 161,065 200 73 (244) (193) 160,722
Balance at 1 January 2024 85 - 131,478 111 - - (144) 131,530
Profit for the year - - 14,212 - - - - 14,212
Other comprehensive income:
Foreign exchange losses on translation of foreign operations - - - - - - 4 4
Movement in investment revaluation reserve for equity instruments at fair - - - 20 - - - 20
value through other comprehensive income
Income tax relating to these items (Note 19) - - - (5) - - - (5)
Other comprehensive (loss)/income net of tax - - - 15 - - 4 19
Total comprehensive income - - 14,212 15 - - 4 14,231
Transactions with owners in their capacity as owners:
Share-based payment expense - - 996 - - - - 996
Change in ownership interest in subsidiary - - 38 - - - - 38
Share capital reduction - (244) - - - - - (244)
Total - (244) 1,034 - - - - 790
Balance at 31 December 2024 85 (244) 146,724 126 - - (140) 146,551
Consolidated Statement of Cash Flows
2025 2024
Note £'000 £'000
Cash (outflow)/inflow from operating activities 23 (613,426) 96,774
Tax paid (4,687) (11,766)
Payments for interest on lease liabilities (45) (33)
Net cash (used in)/generated from operating activities (618,158) 84,975
Cash flow used in investing activities
Purchase of property, plant and equipment 16 (134) (2,428)
Purchase of intangible assets 18 (7,639) (12,524)
Refund of investments in subsidiary undertakings - 39
Purchase of equity investments - (53)
Net cash used in investing activities (7,773) (14,966)
Cash flow used in financing activities
Repayment of principal portion of the lease liability (193) (295)
Purchase of treasury shares (20) (244)
Net cash used in financing activities (213) (539)
Net (decrease)/ increase in cash and cash equivalents (626,144) 69,470
Cash and cash equivalents at the beginning of the year 1,258,435 1,183,777
Effect of exchange rate changes on cash and cash equivalents (26,321) 5,188
Cash and cash equivalents at the end of the year 605,970 1,258,435
Analysed as follows:
Cash and balances at central banks 9 257,867 584,679
Money market funds 10 218,157 488,197
Loans and advances on demand to banks 11 129,946 185,559
Notes to the Financial Statements
1. Statement of Accounting Policies
The following accounting policies relate to the financial statements of CAB
Payments Holdings plc (the 'Company') and its subsidiaries (collectively
referred to as the 'Group').
a) General information
The Company is incorporated and domiciled in England. On 4 July 2023 the
Company was re-registered as a public limited company, CAB Payments Holdings
plc, in order to align with its strategic objectives. The address of its
registered office as at 31 December 2025 is 3 London Bridge St, London, SE1
9SG, England.
The Company's shares trade under the ticker code of CABP.L.
The Group is a market leader in business-to-business cross-border payments and
foreign exchange, specialising in hard-to-reach markets.
b) Basis of preparation
The financial information included in this preliminary announcement have been
prepared in accordance with the Disclosure and Transparency Rules of the UK
Financial Conduct Authority, and the principles of UK-adopted international
accounting standards, but do not comply with the full disclosure requirements
of these standards.
The financial information contained in this announcement does not constitute
the statutory financial statements of the Group as at and for the year ended
31 December 2025, but is derived from those financial statements, which have
been prepared in accordance with the UK adopted International Accounting
Standards (UK-adopted International Financial Reporting Standards (IFRSs)) in
conformity with the applicable legal requirements of the Companies Act 2006.
The statutory financial statements themselves have been approved by the Board
of Directors and reported on by the auditor and will be delivered to the
Registrar of Companies following the Group's Annual General Meeting. The
auditor reported on those financial statements: their report was unqualified,
did not draw attention to any matters by way of emphasis and did not contain a
statement under s498(2) or (3) of the Companies Act 2006.
The preliminary is presented in British Pound Sterling (£). All values are
rounded to the nearest thousand (£'000), except when otherwise indicated.
c) Basis of consolidation
The consolidated financial statements include the financial statements of the
Company and all of the entities controlled by the Company made up to 31
December each year. Control is achieved when the Company:
• has the power over the investee;
• is exposed, or has rights, to variable return from its involvement
with the investee; and
• has the ability to use its power to affect its returns.
The Company reassesses whether or not it controls an investee if facts and
circumstances indicate that there are changes to one or more of the three
elements of control listed above.
A subsidiary is an entity controlled directly or indirectly by the Company.
The Company controls a subsidiary when it is exposed, or has rights, to
variable returns from its involvement with the subsidiary and has the ability
to affect those returns through its power over the investee.
Consolidation of a subsidiary begins when the Company obtains control over the
subsidiary and ceases when the Company loses control of the subsidiary.
Specifically, the results of subsidiaries acquired or disposed of during the
year are included in the consolidated profit or loss account from the date the
Company gains control until the date when the Company ceases to control the
subsidiary.
Where necessary, adjustments are made to the financial statements of
subsidiaries to bring the accounting policies used into line with the Group's
accounting policies.
All intragroup assets and liabilities, equity, income, expenses, and cash
flows relating to transactions between the members of the Group are eliminated
on consolidation, with the exception of foreign currency gains and losses on
intragroup monetary items denominated in a foreign currency of at least one of
the parties.
Changes in the Group's interests in subsidiaries that do not result in a loss
of control are accounted for as equity transactions. The carrying amount of
the Group's interests and the non-controlling interests are adjusted to
reflect the changes in their relative interests in the subsidiaries. Any
difference between the amount by which the non-controlling interests are
adjusted and the fair value of the consideration paid or received is
recognised directly in equity and attributed to the owners of the Company.
The Group has established employee benefit trusts (EBTs) to hold shares to
meet the Group's obligation to provide shares awarded to employees under the
share incentive plan. Shares held by the EBTs are deducted from equity and
presented as Treasury Shares until such time that the shares settle. The EBT
is controlled and recognised by the Company using the look-through approach,
i.e. as if the EBT is included within the accounts of the Company.
d) Going concern
The Directors have assessed the ability of the Company and of the Group to
continue as a going concern based on the net current asset position,
regulatory capital requirements and estimated future cash flows. The Directors
have formed the view that the Company and the Group have adequate resources to
continue in existence for a period of at least 12 months from when these
financial statements are authorised for issuance. Accordingly, the financial
statements of the Company and the Group have been prepared on a going concern
basis.
Critical to reaching this view were:
• The output of internal stress assessments which
were conducted at a Company and a Group level and modelled the impact of
severe yet plausible stresses which underpinned the Going concern assessment.
• The output of the reverse stress testing
assessment which modelled the scenarios that would have to occur in order for
the Group to fall below its Total Capital Requirement (being the aggregate of
Pillar 1 and Pillar 2A capital requirements).
In reaching their conclusions, the Directors also considered the results of
the 2025 Going concern assessment and the three year Budget and Corporate
Plan.
i. Internal stress assessments
In total, three stresses were considered:
• That income from all new products and new markets, which are
either in their infancy and/or are unproven, do not succeed. For prudence, all
costs were assumed to be retained as per the base case plan;
• Market Stress which modelled the impacts of a severe global
recession which leads to increased credit defaults and a low interest rate
environment detrimentally impacting Net Interest Income and GBP sharply
depreciating against USD;
• Idiosyncratic Stress which modelled the impact of a material
reduction in revenue driven by idiosyncratic events.
The Group's most recent ICAAP was approved by the Board in June 2024. As part
of this Going Concern assessment, severe, but plausible Idiosyncratic, and
Combined stresses similar to those applied in that ICAAP are applied to the
three year Budget and Group Corporate Plan which was Board approved during
December 2025.
In all the stresses noted above the Group maintained sizeable surpluses to the
Total Capital Requirement and liquidity requirements.
ii. Reverse stress tests
The reverse stress tests are used to assess vulnerabilities of the Group and
determine what extreme adverse events would cause the business to fail. Where
any of these events are deemed to be plausible, the Group will adopt measures
to mitigate the impact of such events where plausible.
The Group did not identify reasonably possible scenarios which could result in
failure to continue in operational existence for a period of at least 12
months from when these financial statements are authorised for issuance.
iii. Conclusion
The Directors are of the view that:
• There are no material uncertainties relating to events or
conditions that cast significant doubt on the Company's and the Group's
ability to continue as a going concern; andThe significant judgements and
estimates made by management in determining whether or not the adoption of the
going concern is appropriate are disclosed in Note 18. The forecasts and
assumptions used for impairment assessments were the same used for the going
concern assessment.
Accordingly, the financial statements have been prepared on a going concern
basis.
e) Interest income and interest expense
i) Net interest income
Interest income and interest expense for all interest-bearing financial
instruments, including interest accruals on related FX contracts, are
recognised within Net interest income in the consolidated statement of profit
or loss and other comprehensive income. The interest expense on financial
liabilities and interest income on assets that are held for collection of
contractual cash flows, where those cash flows represent solely payments of
principal and interest, is recognised using the effective interest method.
The effective interest method is a method of calculating the amortised cost of
a financial asset or financial liability and of allocating the interest income
or expense over the relevant period. The effective interest rate is the rate
that exactly discounts estimated future cash payments or receipts (including
all fees and points paid or received that form an integral part of the
effective interest rate, transaction costs and other premiums or discounts)
through the life of the financial instrument or, when appropriate, a shorter
period, to the net carrying amount of the financial asset or financial
liability.
ii) Net loss on financial instruments measured at fair value through profit or
loss
This balance comprises the interest income or interest expense on FX
derivatives. It is measured at the contractual interest rate. The balance also
comprise:
• Fair value gains or losses on the hedged instruments;
• Fair value gains and losses on the hedged items measured at
amortised cost;
• The effective portion adjustments of the fair value hedges; and
• Effective gains/losses reclassified to income statement from cash
flow hedge reserve when a hedged item affected net profit.
f) Fees and commission income
Fees and commission receivable which are not an integral part of the effective
interest rate are recognised as income as the Group fulfils its performance
obligations. Fees and commission income includes the following key revenue
streams:
• Account management and payment services: the Group's performance
obligation in relation to account management services is to provide management
or maintenance services to its current account holders. The revenue for these
services is recognised over the life of the contract on a monthly basis as
fees are received. Crown Agents Bank Ltd (CAB) provides the service. Payment
services fees relate to services offered by the Group to its clients by
executing payment transactions. Revenue from providing services is recognised
at a point in time when the services are rendered i.e. when the payments are
executed.
• Pension payment fees: pension payment fees are charged to pension
companies for making payment to pension beneficiaries on their behalf. The
Group acts as a principal in rendering these services to its clients. Revenue
from providing services is recognised at a point in time when the services are
rendered i.e., when the payments are executed.
• Trade finance - Financial guarantee income: includes fixed fees
earned for issuing financial guarantee contracts. The performance obligation
of the Group is to provide financial assurance to the recipient of the
guarantee in case of payment default. Revenue is recognised over the period of
the contract term. The fees for providing financial guarantee services are
charged and collected upfront.
• Trade Finance - Income from letters of credit: the Group also
receives fees in respect of the issue of letters of credit where the
performance obligations are typically fulfilled towards the end of the client
contract. Where it is unlikely that the letter of credit will be drawn down,
it is recognised in fee and commission income over the life of the facility,
rather than as an adjustment to the effective interest rate for loans expected
to be drawn as they are short-term facilities. The fees for acceptance of
letters of credits include fees and are charged and collected upfront. Other
charges include advising fees, confirming bank fees, and bank charges, all of
which are collected on the completion of the term of the letter of credit.
• Electronic platform fees: fees for the services provided by the
Group using its electronic platform to facilitate bulk payments to its
clients. Revenue is recognised at a point in time when the services are
rendered i.e., when the payments are executed.
g) Net foreign exchange gain
Net FX gain comprises wholesale FX and FX gain on payment transactions as
follows:
• Wholesale FX - Profit on settlement of FX contracts: these profits
arise on FX Settlements involving the instruction of client payments to
specific recipients. Under the Group's FX and payment services, clients agree
to terms and conditions for all transactions at the time of signing a contract
with the Group. On trade date the Group measures these cash flows at fair
value, with further changes in fair value being recognised in profit or loss
until the settlement of the contract. This balance includes both realised and
unrealised FX income at year-end.
• Wholesale FX - Remeasurement of non-sterling balances: Foreign
currency transactions are translated into the functional currency using the
spot exchange rates at the dates of the transactions. At each period end
foreign currency monetary items are translated to the functional currency
using the closing rate. Non-monetary items measured at historical cost are
translated using the exchange rate at the date of the transaction and
non-monetary items measured at fair value are measured using the exchange rate
when fair value was determined. FX gains and losses resulting from the
settlement of transactions and from the translation at period-end exchange
rates of monetary assets and liabilities denominated in foreign currencies are
recognised in the consolidated statement of profit or loss except for FX gains
and losses in relation to instruments measured at fair value through other
comprehensive income (FVTOCI) which are recognised in other comprehensive
income (OCI).
• Wholesale FX - Fair value gains or losses on
derivatives:this comprises the profits and losses on remeasurement of forward
FX derivatives carried at fair value through profit and loss (FVTPL).
• FX gain on payment transaction revenue: a FX
gain or loss on payment transactions is the difference between the spot
exchange rate between the functional currency and the foreign currency at the
date of the payment transaction.
h) Foreign currency transactions and balances policy
(i) Functional and presentational currency
The Company's and the Group's functional and presentational currency is
British Pound Sterling (£).
(ii) Transactions and balances
Foreign currency transactions are translated into the functional currency
using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated to the
functional currency using the closing rate. Non‑monetary items measured at
historical cost are translated using the exchange rate at the date of the
transaction and non-monetary items measured at fair value are measured using
the exchange rate when fair value was determined.
FX gains and losses resulting from the settlement of transactions and from the
translation at period-end exchange rates of monetary assets and liabilities
denominated in foreign currencies are recognised in the consolidated statement
of profit or loss except for FX gains and losses in relation to instruments
measured at fair value through other comprehensive income (FVTOCI) which are
recognised in other comprehensive income (OCI).
(iii) Group companies
For the purpose of presenting consolidated financial statements, the assets
and liabilities of the Group's foreign operations are translated to the
Group's presentational currency at exchange rates prevailing at the close of
business on the balance sheet date. Income and expense items are translated at
the exchange rates on the day of the transaction.
FX differences arising on the translation of a foreign operation are
recognised in other comprehensive income and accumulated in the Foreign
Currency Translation Reserve (FCTR).
(iv) Lack of exchangeability on currencies
If a currency becomes unexchangeable either for purposes of translating
foreign currency transactions during the year or foreign operations and FX
balance sheet balances to GBP at reporting date, management estimates the spot
exchange rates for such currencies in line with IAS 21 requirements by using
either:
• an observable exchange rate without adjustment (e.g.
exchange rates from the market sources or independent providers like Reuters);
or
• an estimation technique e.g. first subsequent
available exchange rate from official independent sources.
The impact of this amendment, effective 1 January 2025, has been assessed as
not material to the Group.
i) Taxation
The tax expense for the period comprises current and deferred tax recognised
in the reporting period. Current and deferred tax are recognised in profit or
loss, except when they relate to items that are recognised in other
comprehensive income or directly in equity, in which case, the current and
deferred tax are also recognised in other comprehensive income or directly in
equity respectively. If current tax or deferred tax arises from the initial
accounting for a business combination, the tax effect is included in the
accounting for the business combination.
Current or deferred tax assets or liabilities are not discounted.
Current tax
Current tax is the tax expected to be payable on the taxable profit for the
year and on any adjustment to tax payable in respect of previous years.
Taxable profit differs from net profit as reported in profit or loss because
it excludes items of income or expense that are taxable or deductible in other
years and it further excludes items that are never taxable or deductible. The
Group's liability for current tax is calculated using tax rates that have been
enacted or substantively enacted by the end of the reporting period.
A provision is recognised for those matters for which the tax determination is
uncertain but it is considered probable that there will be a future outflow of
funds to a tax authority. The provisions are measured at the best estimate of
the amount expected to become payable.
If a company within the Group incurs losses within the period, that company
may surrender trading losses and other amounts eligible for relief from
corporation tax to another Group company (the 'claimant company') for the
claimant company to set off against its own profits for corporation tax
purposes as permitted by HMRC.
Deferred tax
Deferred tax is the tax expected to be payable or recoverable on differences
between the carrying amounts of assets and liabilities in the financial
statements and the corresponding tax bases used in the computation of taxable
profit, and is accounted for using the liability method. Deferred tax
liabilities are generally recognised for all taxable temporary differences and
deferred tax assets are recognised to the extent that it is probable that
taxable profits will be available against which deductible temporary
differences can be utilised. Such assets and liabilities are not recognised if
the temporary difference arises from the initial recognition (other than in a
business combination) of other assets and liabilities in a transaction that
affects neither the taxable profit nor the accounting profit. In addition, a
deferred tax liability is not recognised if the temporary difference arises
from the initial recognition of goodwill.
j) Intangible assets (excluding Goodwill)
Intangible assets (except for Goodwill) are stated at cost less accumulated
amortisation and accumulated impairment losses. The residual value of such
intangible assets is amortised, using the straight-line method, over their
estimated useful lives, as follows:
• Core accounting software - 12.5 years;
• Other software - 5 years (subject to regular management assessment
of the economic benefit of the asset); and
• Brand/name - 50 years (acquired).
Costs associated with maintaining computer software are recognised as an
expense as incurred. Development costs that are directly attributable to the
design and testing of identifiable and unique software products controlled by
the Group are recognised as intangible assets when the following criteria are
met:
• it is technically feasible to complete the software so that it
will be available for use;
• management intends to complete the software and use or sell it;
• there is an ability to use or sell the software;
• it can be demonstrated how the software will generate probable
future economic benefits;
• adequate technical, financial and other resources to complete the
development and to use or sell the software are available; and
• the expenditure attributable to the software during its
development can be reliably measured.
Other development expenditure that does not meet these criteria is recognised
as an expense as incurred. Development costs previously recognised as an
expense are not recognised as an asset in a subsequent period. Long-term
software-as-a-service (SaaS) type contracts that do not meet the definition of
an asset (rental of software) are expensed to profit and loss over the period
of the contract in line with the benefits received.
k) Property, plant and equipment, and depreciation
Property, plant and equipment are stated in the statement of financial
position at historic cost less accumulated depreciation. Cost includes the
original purchase price of the asset and the costs attributable to bring the
asset to its working condition for its intended use. Depreciation commences
when an asset becomes available for use and is calculated to write down assets
to their residual value in equal instalments, on a straight-line basis over
their estimated useful lives, as follows:
Leasehold improvements Life of lease
Computer equipment 5 years
Fixtures and fittings 5 years
Artwork 20 years
l) Impairment of non-financial assets
At each statement of financial position date, non-financial assets not carried
at fair value are assessed to determine whether there is an indication that
the asset may be impaired, such as a decline in operational performance,
geopolitical uncertainty, economic uncertainty i.e. rising interest rates and
inflation, or changes in the outlook of future profitability among other
potential indicators. If there is such an indication the recoverable amount of
the asset is compared to the carrying amount of the asset.
Individual assets are grouped for impairment assessment purposes at the lowest
level at which there are identifiable cash inflows that are largely
independent of the cash flows of other groups of assets. This should be at a
level not higher than an operating segment. The recoverable amount of the
asset is the higher of the fair value less costs to sell and value in use.
Value in use is defined as the present value of the future cash flows before
interest and tax obtainable as a result of the asset's continued use. These
cash flows are discounted using a pre-tax discount rate that represents the
current market risk-free rate and the risks inherent in the asset. In
determining fair value less costs to sell, recent market transactions are
taken into account. If no such transactions can be identified, an appropriate
valuation model is used. If the recoverable amount of the asset is estimated
to be lower than the carrying amount, the carrying amount is reduced to its
recoverable amount. An impairment loss is recognised in the statement of
profit or loss unless the asset has been revalued then the amount is
recognised in other comprehensive income to the extent of any previously
recognised revaluation. An impairment loss recognised on goodwill is not
reversed in a subsequent period.
If an impairment loss is subsequently reversed, the carrying amount of the
asset is increased to the revised estimate of its recoverable amount, but only
to the extent that the revised carrying amount does not exceed the carrying
amount that would have been determined (net of depreciation or amortisation)
had no impairment loss been recognised in prior periods. A reversal of an
impairment loss is recognised in the statement of profit or loss and other
comprehensive income.
Goodwill is allocated on acquisition to the cash-generating unit expected to
benefit from the synergies of the combination. Goodwill is included in the
carrying value of cash-generating units for impairment testing.
Disposal groups held for sale are measured at the lower of their carrying
amount and fair value less costs to sell. At initial classification of the
disposal group as held for sale, the carrying amounts of all the individual
assets and liabilities in the disposal group are measured in accordance with
the Group's accounting policies. If fair value less costs to sell for the
disposal group is below the aggregate carrying amount of all of the assets and
liabilities included in the disposal group, the disposal group is written
down. The impairment loss is recognised in profit or loss for the period.
m) Cash and cash equivalents
Cash and cash equivalents include cash in hand and deposits held at call with
commercial or central banks and exposures to money market funds (transacted
via open-ended investment companies). Cash equivalents are short-term highly
liquid investments that are readily convertible to a known amount of cash and
which are subject to an insignificant risk of changes in value. Cash
equivalents are held for the purpose of meeting short-term cash commitments
rather than for investment or other purposes.
n) Goodwill
Goodwill arises on the acquisition of subsidiaries and represents the excess
of the consideration transferred over the Group's interest in the net fair
value of the net identifiable assets, liabilities and contingent liabilities
of the acquiree and the fair value of any non-controlling interest in the
acquiree.
Goodwill is tested for impairment at the end of each accounting period.
On disposal of a cash-generating unit, the attributable amount of goodwill is
included in the determination of the profit or loss on disposal. Goodwill is
accounted for at cost less accumulated impairment losses.
o) Financial instruments
Financial assets and financial liabilities are recognised in the Company and
Group statements of financial position when the Company or Group becomes a
party to the contractual provisions of the instrument.
Financial assets and financial liabilities are initially measured at fair
value. Transaction costs that are directly attributable to the acquisition or
issue of financial assets and financial liabilities (other than financial
assets and financial liabilities at fair value through profit or loss) are
added to or deducted from the fair value of the financial assets or financial
liabilities, as appropriate, on initial recognition. Transaction costs
directly attributable to the acquisition of financial assets or financial
liabilities at fair value through profit or loss are recognised immediately in
profit or loss.
(i) Financial assets
All regular way purchases or sales of financial assets are recognised and
derecognised using trade date accounting. The trade date is the date of the
commitment to buy or sell the financial asset.
All recognised financial assets are measured subsequently in their entirety at
either amortised cost or fair value, depending on the classification of the
financial assets.
Classification of financial assets
Financial assets that meet the following conditions are measured subsequently
at amortised cost:
• the financial asset is held within a business model whose
objective is to hold financial assets in order to collect contractual cash
flows; and
• the contractual terms of the financial asset give rise on
specified dates to cash flows that are solely payments of principal and
interest on the principal amount outstanding.
•
• Financial assets that meet the following conditions are measured
subsequently at FVTOCI:
• the financial asset is held within a business model whose
objective is achieved by both collecting contractual cash flows and selling
the financial assets; and
• the contractual terms of the financial asset give rise on
specified dates to cash flows that are solely payments of principal and
interest on the principal amount outstanding.
Despite the foregoing, the Group and the Company may irrevocably elect to
present subsequent changes in fair value of an equity investment in other
comprehensive income if equity instruments are held as a strategic investment
and not held with the intention to realise a profit.
By default, all other financial assets are measured subsequently at fair value
through profit or loss.
The Group's financial assets measured at amortised cost consist of:
• Cash and balances at central banks;
• Loans and advances on demand to banks;
• Other loans and advances to banks;
• Other loans and advances to non-banks;
• Investment in debt securities at amortised cost;
• Other assets;
• Accrued income; and
• Unsettled transactions.
The nature of all financial items included in a given balance sheet line item
is as shown in the respective note breakdown.
The Group's financial assets measured at FVTPL consist of money market funds
and derivative financial instruments.
Financial assets at FVTPL are measured at fair value at the end of each
reporting period, with any fair value gains or losses recognised in profit or
loss.
The Group's financial assets designated at FVTOCI comprise primarily its
investments in debt securities at FVTOCI, also not held for trading (Note 14)
and investment in equity securities, which are not held for trading.
The equity instruments are held as a strategic investment and not held with
the intention to realise a profit.
Investments in equity instruments at FVTOCI are initially measured at fair
value plus transaction costs. Subsequently, they are measured at fair value
with gains and losses arising from changes in fair value recognised in other
comprehensive income and accumulated in the Investment revaluation reserve.
The cumulative gain or loss is not reclassified to profit or loss on disposal
of the equity investments, instead, it is transferred to retained earnings.
Dividends on these investments in equity instruments are recognised in profit
or loss in accordance with IFRS 9 unless the dividends clearly represent a
recovery of part of the cost of the investment. Dividends are included in the
'Other operating income' line item in the statement of profit or loss and
other comprehensive income.
Investments in debt securities at FVTOCI's business model is to hold to
collect and sell. They are initially measured at fair value plus transaction
costs. Subsequently, they are measured at fair value with gains and losses
arising from changes in fair value recognised in other comprehensive income
and accumulated in the debt securities revaluation reserve. The cumulative
gain or loss is reclassified to profit or loss on disposal of the investments.
Interest income is recognised using the effective interest method for debt
instruments measured subsequently at amortised cost (Note 1 (e)) above.
Interest income is recognised in the statement of profit or loss and other
comprehensive income in the 'Net interest income' line item (Note 3).
Derecognition of financial assets
The Group derecognises a financial asset only when the contractual rights to
the cash flows from the asset expire, or when it transfers the financial asset
and substantially all the risks and rewards of ownership of the asset to
another entity.
On derecognition of a financial asset the difference between the asset's
carrying amount and the sum of the consideration received and receivable is
recognised in profit or loss.
(ii) Financial liabilities
Debt and equity instruments are classified as either financial liabilities or
as equity in accordance with the contractual substance of the contractual
arrangements and the definitions of a financial liability and an equity
instrument.
Classification of financial liabilities
All financial liabilities are measured subsequently at amortised cost using
the effective interest method or at fair value through profit and loss.
Financial liabilities at fair value through profit and loss
The Group's financial liabilities at fair value through profit and loss
consist of derivative liabilities (see below for policy on derivative
financial instruments).
Financial liabilities at fair value through profit and loss are measured at
fair value, with any gains or losses arising on changes in fair value
recognised in profit or loss.
Financial liabilities at amortised cost
The Group's financial liabilities at amortised cost consist of customer
accounts, unsettled transactions and other liabilities such as trade
creditors, funds received in advance, transactions credited by third-party
nostro providers and other creditors.
Financial liabilities at amortised cost are measured subsequently at amortised
cost using the effective interest method .
Derecognition of financial liabilities
Financial liabilities are derecognised when, and only when, the Group's
obligations are discharged, cancelled or have expired. The difference between
the carrying amount of the financial liability derecognised and the
consideration paid and payable is recognised in profit or loss.
(iii) Derivative financial instruments
The Group's derivatives policy only permits dealing in forward FX contracts
and interest rate swaps to hedge, to provide services to clients or to
facilitate cash management.
Derivative financial instruments are initially recognised at fair value on the
date a derivative contract is entered into and are subsequently remeasured at
their fair value at the reporting date.
Derivatives are financial instruments that derive their value from the price
of underlying items such as equities, interest rates or other indices.
Derivatives are recognised initially and are subsequently measured at fair
value through profit or loss. Derivatives are classified as assets when their
fair value is positive or as liabilities when their fair value is negative.
Hedge accounting
Under certain conditions, the Group may designate a recognised asset or
liability, a firm commitment or highly probable forecast transaction into a
formal hedge accounting relationship with a derivative that has been entered
to manage interest rate and risks present in the hedged item. The Group has a
policy to apply hedge accounting in accordance with IAS 39.
There are two categories of hedge relationships:
• Macro Fair value hedge: to manage the fair value of interest rate
risks of recognised assets or liabilities or firm commitments.
• Macro Cash flow hedge: to manage interest rate risks of highly
probable future cash flows attributable to a recognised asset or liability, or
a forecasted transaction.
In the case of the hedge of a forecast transaction, the transaction must have
a high probability of occurring and must present an exposure to variations in
cash flows that are expected to affect reported profit or loss.
Hedges are considered to be highly effective if all the following criteria are
met:
• At inception of the hedge and throughout its life, the hedge is
prospectively expected to be highly effective in achieving offsetting changes
in fair value or cash flows attributable to the hedged risk.
• The Group establishes the hedging ratio by matching the notional
amount of the derivatives with the principal of that portion of the portfolio
being hedged and manages this on a monthly basis by entering into interest
rate swaps. This is tested using regression analysis.
• Prospective and retrospective effectiveness of the hedge should be
within a range of 80-125%.
• This is tested using regression analysis where the slope of the
regression line must be between -0.80 and -1.25 and the data pairs between the
hedged item and the hedging instrument are regressed to a 95% confidence
interval. The regression co-efficient (R squared), which measures the
correlation between the variables in the regression, is at least 96%.
In the case of the hedge of a forecast transaction, the transaction must have
a high probability of occurring and must present an exposure to variations in
cash flows that are expected to affect reported profit or loss.
Macro Fair value hedge
Changes in the fair value of derivatives that are designated and qualify as
fair value hedging instruments are recorded in 'Net loss on financial assets
and financial liabilities mandatorily held at fair value through profit or
loss', together with any changes in the fair value of the hedged asset or
liability that are attributable to the hedged risk. If the hedge no longer
meets the criteria for hedge accounting, the adjustment to the carrying amount
of a hedged item for which the effective interest method is used is amortised
to the income statement over the remaining term to maturity of the hedged
item. If the hedged item is sold or repaid, the unamortised fair value
adjustment is recognised immediately in the income statement. .
Macro Cash flow hedge
The effective portion of changes in the fair value of derivatives that are
designated and qualify as cash flow hedging instruments are initially
recognised in other comprehensive income, accumulating in the cash flow hedge
reserve within equity. These amounts are subsequently recycled to the income
statement in the periods when the hedged item affects profit or loss. Both the
derivative fair value movement and any recycled amount are recorded in the
'Cashflow hedge reserve' line item in other comprehensive income.
The Group assesses hedge effectiveness using the hypothetical derivative
method, which creates a derivative instrument to serve as a proxy for the
hedged transaction. The terms of the hypothetical derivative match the
critical terms of the hedged item and it has a fair value of zero at
inception. The hypothetical derivative and the actual derivative are regressed
to establish the statistical significance of the hedge relationship.
Any ineffective portion of the gain or loss on the hedging instrument is
recognised in the profit or loss immediately.
If a cash flow hedge is discontinued, the amount accumulated in the cash flow
hedge reserve is released to the income statement as and when the hedged item
affects the income statement.
Should the Group consider the hedged future cash flows are no longer expected
to occur due to reasons, the cumulative gain or loss will be immediately
reclassified to profit or loss.
(iv) Offsetting
Financial assets and liabilities are offset and the net amounts presented in
the financial statements only when there is a legally enforceable right to set
off the recognised amounts and there is an intention to settle on a net basis
or to realise the asset and settle the liability simultaneously.
(v) Equity
An equity instrument is any contract that evidences a residual interest in the
assets of an entity after deducting all of its liabilities.
Repurchase of the Company's own equity instruments is recognised and deducted
directly from equity. No gain or loss is recognised in profit or loss on the
purchase, sale, issue or cancellation of the Company's own equity instruments.
(vi) Financial guarantee contracts and letter of credit confirmations/bill
acceptances - provisions
Financial guarantee contracts
A financial guarantee contract is a contract that requires the issuer to make
specified payments to reimburse the holder for a loss it incurs because a
specified debtor fails to make payments when due, in accordance with the terms
of a debt instrument.
Letters of credit confirmations/bill acceptances
A letter of credit confirmation/acceptance is a letter from an issuing bank
guaranteeing that a buyer's payment to a seller will be received on time and
for the correct amount. The Group confirms/accepts the letters of credit
issued by an issuing bank and charges fixed fees which are received either in
advance or at a later date.
Fees relating to financial guarantee contracts and letter of credit
confirmations/bill acceptances issued by the Group can be received upfront and
these fees are amortised on a straight-line basis to income over the year. The
receivable increases over the life of the contract as service is performed
with the corresponding recognition of income in the statement of profit or
loss. All financial guarantee contracts issued by the Group are subsequently
measured at the higher of:
• the amount of the loss allowance determined in accordance with
IFRS 9; and
• the amount initially recognised less, where appropriate, the
cumulative amount of income recognised in accordance with the Group's revenue
recognition policies.
Such amounts are presented as provisions on the statement of financial
position and the remeasurement is included within the reversal of
impairment/(impairment loss) on financial assets at amortised cost.
(vii) Impairment of financial assets
The Group recognises loss allowances for Expected Credit Loss (ECL) in
accordance with IFRS 9 on financial assets.
Equity investments are not subject to impairment, consistent with IFRS 9.
ECLs are required to be measured through a loss allowance at an amount equal
to:
• 12-month ECL (referred to as Stage 1); or
• full lifetime ECL (referred to as Stage 2 and
Stage 3).
For Stages 1 and 2, interest revenue is calculated on the gross carrying
amount. Under Stage 3, interest revenue is calculated based on the net
carrying amount (gross amount less ECL).
The amount of ECL is updated at each reporting date to reflect changes in
credit risk since initial recognition of the respective financial instrument.
For these financial assets, the Group recognises lifetime ECL when there has
been a significant increase in credit risk since initial recognition. However,
if the credit risk on the financial instrument has not increased significantly
since initial recognition, the Group measures the loss allowance for that
financial instrument at an amount equal to 12-month ECL.
Lifetime ECL represents the expected credit losses that will result from all
possible default events over the expected life of a financial instrument. In
contrast, 12-month ECL represents the portion of lifetime ECL that is expected
to result from default events on a financial instrument that are possible
within 12 months after the reporting date.
Significant increase in credit risk
The Group monitors all financial assets, financial guarantee contracts and
letter of credit confirmations/bill acceptances that are subject to the
impairment requirements to assess whether there has been a significant
increase in credit risk since initial recognition. If there has been a
significant increase in credit risk the Group will measure the loss allowance
based on lifetime rather than 12-month ECL.
Definition of default
The Group considers the following as constituting an event of default for
internal credit risk management purposes as historical experience indicates
that financial assets that meet the earlier of either of the following
criteria are generally not recoverable:
• when there is a breach of financial covenants by
the debtor; or
• information developed internally or obtained
from external sources indicates that the debtor is unlikely to pay its
creditors, including the Group, in full.
Irrespective of the above analysis, the Group considers that default has
occurred when a financial asset is more than 90 days past due unless the Group
has reasonable and supportable information to demonstrate that a more lagging
default criterion is more appropriate.
Write-off policy
The Group writes off a financial asset when there is information indicating
that the debtor is in severe financial difficulty and there is no realistic
prospect of recovery, e.g. when the debtor has been placed under liquidation
or has entered into bankruptcy proceedings. Financial assets written off may
still be subject to enforcement activities under the Group's recovery
procedures, taking into account legal advice where appropriate. Any recoveries
made are recognised in profit or loss.
Measurement and recognition of ECLs
ECLs are a probability-weighted estimate of the present value of credit
losses. These are measured as the present value of the difference between the
cash flows due to the Group under the contract and the cash flows that the
Group expects to receive arising from the weighting of multiple future
economic scenarios, discounted at the asset's Effective Interest Rate (EIR).
The measurement of expected credit losses is a function of the
• probability of default
• loss given default (i.e. the magnitude of the loss if there is a
default); and
• exposure at default.
The assessment of the probability of default and loss given default is based
on historical data adjusted by forward-looking information.
As for the exposure at default, for financial assets, this is represented by
the assets' gross carrying amount at the reporting date.
For financial guarantee contracts and letter of credit confirmations/bill
acceptances, the exposure includes the amount of guaranteed debt that has been
drawn down as at the reporting date, together with any additional guaranteed
amounts expected to be drawn down by the borrower in the future by default
date determined based on historical trend, the Group's understanding of the
specific future financing needs of the debtors, and other relevant
forward-looking information.
For a financial guarantee contract and letter of credit confirmations/bill
acceptances, as the Group is required to make payments only in the event of a
default by the debtor in accordance with the terms of the instrument that is
guaranteed, the expected loss allowance is the expected payments to reimburse
the holder for a credit loss that it incurs less any amounts that the Group
expects to receive from the holder, the debtor, or any other party.
If the Group has measured the loss allowance for a financial instrument at an
amount equal to lifetime ECL in the previous reporting period but determines
at the current reporting date that the conditions for lifetime ECL are no
longer met, the Group measures the loss allowance at an amount equal to
12-month ECL at the current reporting date.
The Group measures ECL on an individual basis, or on a collective basis for
portfolios of loans that share similar economic risk characteristics. The
measurement of the loss allowance is based on the present value of the asset's
expected cash flows using the asset's original EIR, regardless of whether it
is measured on an individual basis or a collective basis.
Presentation of ECL
Loss allowances for ECL are presented in the statement of financial position
as follows:
• for financial assets measured at amortised cost: as a deduction
from the gross carrying amount of the assets; and
• financial guarantee contracts: as a provision.
The Group recognises an increase or decrease in impairment in profit or loss
for all financial instruments with a corresponding adjustment to their
carrying amount through a loss allowance account.
p) Employee benefits
The Group provides a range of benefits to employees, including annual bonus
arrangements, paid holiday arrangements, medical insurance and defined
contribution pension plans. The Group has implemented a one-off Free Share
Scheme following the 2023 listing and a Matching/Partnership Share Scheme,
both schemes for all employees. The Group also provides share incentive
schemes to Executive Directors and certain other key employees or senior
management as follows:
• Long-Term Incentive Plans (LTIP);
• a Matching/Partnership Share Incentive Plan (all employees)
• a Free Shares Plan* (all employees);
*Applicable to 2024 only.
Short-term benefits
Short-term benefits, including holiday pay and other similar non-monetary
benefits, are recognised as an expense in the period in which the service is
received.
Pension contributions
All pension contributions are accounted for as defined contributions and paid
over on a monthly basis. No liability for pension entitlement accrues to the
Group.
Share-based payment arrangements
The Group provides share-based payment arrangements to certain employees (as
noted above).The awards are equity-settled arrangements and are measured at
fair value of the equity instruments at the grant date. The fair value is
expensed on a straight-line basis over the vesting period. The fair value of
the employee services received in exchange for the grant of the awards is
recognised in employee benefit expenses together with a corresponding increase
in equity (retained earnings), over the period in which the service and the
performance conditions are fulfilled (the vesting period). The grant date fair
value is not adjusted for subsequent changes in the fair value of the equity
instruments.
Long-term incentive plan awards are subject to performance conditions. LTIP
awards granted in 2023 and 2024 are subject to both market performance
conditions (relating to Total Shareholder Returns) and non-market performance
conditions (relating to Earnings Per Share) The 2025 LTIP awards are subject
non-market performance conditions only (relating to Earnings Per Share,
Cost-Income Ratio and Adjusted EBITDA per average full-time equivalent
employee for 2025 LTIP and Adjusted Profit After Tax for 2025 LTIP
Acceleration Award).
Service conditions are not taken into account when determining the grant date
and for fair value of awards, but the likelihood of the conditions being met
is assessed as part of the Group's best estimate of the number of equity
instruments that will ultimately vest. Any other conditions attached to an
award, but without an associated service requirement, are non-vesting
conditions. Non-vesting conditions are reflected in the fair value of an
award. Share awards vest when service conditions are met.
Where the equity-settled arrangements are modified before the vesting date,
and are of benefit to the employee, the incremental fair value is recognised
over the period from the date of modification to the date of vesting. If
modified after vesting, it is recognised immediately. Where a modification is
not beneficial to the employee there is no change to the charge for the
share-based payment. Settlement and cancellations are treated as an
acceleration of vesting and the unvested amount is recognised immediately in
the statements of profit or loss and other comprehensive income.
The Group has no cash-settled arrangements.
q) Investments in subsidiaries
Investments in subsidiaries are non-monetary assets measured at cost less
impairment.
r) Provisions and contingent liabilities
Provisions are recognised in respect of present obligations arising from past
events where it is probable that outflows of resources will be required to
settle the obligations and they can be reliably estimated. Provisions
comprises dilapidation provision on the leased office space.
Contingent liabilities are possible obligations whose existence depends on the
outcome of uncertain future events or those present obligations where the
outflows of resources are uncertain or cannot be measured reliably. Contingent
liabilities are not recognised in the consolidated and Company financial
statements but are disclosed unless they are remote.
s) Share capital
On issue of ordinary shares, any consideration received is included in equity
net of any directly attributable transaction costs.
t) Earnings per share
i. Basic earnings per share
Basic earnings per share is calculated on the Group's profit or loss after
taxation attributable to the owners of the parent and based on the weighted
average of ordinary shares at the end of the year.
ii. Diluted earnings per share
Diluted earnings per share is calculated on the Group's profit or loss after
taxation attributable to owners of the parent and based on the weighted
average of ordinary shares at the end of the year and the weighted average
number of ordinary shares that would be issued on conversion of all the
dilutive potential ordinary shares into ordinary shares. Performance-based
employee share options are treated as contingently issuable shares because
their issue is contingent upon satisfying specified conditions in addition to
the passage of time.
u) Dividends
Dividends are recognised in the financial statements in the period they are
paid.
v) Leases (Group as lessee)
The Group assesses whether a contract is, or contains, a lease, at inception
of the contract. The Group recognises a right-of-use asset and corresponding
lease liabilities with respect to all lease arrangements in which it is the
lessee, except for short-term leases (defined as leases with a lease term of
12 months or less) and leases of low-value assets (such as small items of
fixtures and equipment and value of less than £10,000). For these leases, the
Group recognises the lease payments as an Operating Expense on a straight-line
basis over the term of the lease unless another systematic basis is more
representative of the time pattern in which economic benefits from the leased
assets are consumed.
The lease liabilities are initially measured at the present value of the lease
payments that are not paid at the commencement date, discounted by using the
rate implicit in the lease. If this rate cannot be readily determined, the
Group uses its incremental borrowing rate.
Lease payments included in the measurement of the Group's lease liabilities
are fixed lease payments less any lease incentives receivable.
The lease liabilities are presented as a separate line in the consolidated
statement of financial position.
The lease liabilities are subsequently measured by increasing the carrying
amount to reflect interest on the lease liabilities (using the effective
interest method) and by reducing the carrying amount to reflect the lease
payments made.
The right-of-use assets comprise the initial measurement of the corresponding
lease liabilities, lease payments made at or before the commencement day, less
any lease incentives received and any initial direct costs and estimations of
any dilapidation obligations. They are subsequently measured at cost less
accumulated depreciation and impairment losses.
Right-of-use assets are depreciated over the shorter period of lease term and
useful life of the right-of-use asset. The depreciation starts at the
commencement date of the lease. The right-of-use assets are presented as a
separate line in the consolidated statement of financial position.
The Group applies IAS 36 to determine whether a right-of-use asset is impaired
and accounts for any identified impairment loss as described in the
'impairment of non-financial assets' policy.
In line with IFRS 9, a liability is derecognised when the obligation in the
contract is extinguished or cancelled, which in the context of the lease
liabilities, they are derecognised when the Group and its subsidiaries have
been legally released from the obligations by the creditors.
The dilapidation provision is recognised in accordance with IAS 37 when a
present obligation exists due to a lease agreement requiring restoration of
premises. It is initially measured at the best estimate of the expected costs
to settle the obligation, discounted to present value if the time value of
money is material. Subsequently, the provision is reviewed at each reporting
date and adjusted for changes in estimates, such as cost revisions or discount
rate changes. If initially discounted, the unwinding of the discount is
recognised as an interest expense in profit or loss.
w) Non-underlying items
The Group separately identifies results before non-underlying items. These
measures are not measures of performance under IFRS and should be considered
in addition to, and not as a substitute for, IFRS measures of financial
performance and liquidity. The Group uses its judgement to classify items as
non-underlying. Income or expenses are recognised and classified as
non-underlying when the following criteria are met:
• The item does not arise in the normal course of
business; and
• The items are material by amount or nature.
Non-underlying items include other income or expenses not considered to drive
the operating results of the Group including transaction, transformational, as
well as restructuring costs. When items meet the criteria, they are recognised
and classified as non-underlying and this is applied consistently from year to
year,
w) New and revised IFRS accounting standards in issue but not yet effective
At the date of authorisation of these consolidated financial statements, the
Group has not applied the following new and revised IFRS Accounting Standards
that have been issued but are not yet effective.
Accounting standard* Details of amendment
Amendments to the Classification and Measurement of Financial Instruments - The amendments provide guidance related to:
Amendments to IFRS 9 Financial Instruments and IFRS 7 Financial Instruments:
Disclosures effective 1 January 2026 • Financial assets with ESG-linked features;
• Settlement of financial liabilities by electronic payments.
New sustainability standards issued by the International Sustainability The ISSB issued its first two sustainability reporting standards on 26 June
Standards Board (ISSB) effective 1 January 2026 in the UK 2023. This included:
• General Requirements for Disclosure of Sustainability-related
Financial Information (IFRS S1), the core framework for the disclosure of
material information about sustainability-related risks and opportunities
across an entity's value chain.
• Climate-related Disclosures (IFRS S2), the first thematic
standard issued that sets out requirements for entities to disclose
information about climate-related risks and opportunities.
IFRS 18 Presentation and Disclosure in Financial Statements effective 1 IFRS 18 affects all companies, bringing significant changes to how companies
January 2027 present their income and what information companies need to disclose, and
making certain 'non-GAAP' measures part of audited financial statements for
the first time. There will be three new categories of income and expenses, two
defined income statement subtotals and one single note on management-defined
performance measures.
IFRS 19 Reduced Disclosures for Subsidiaries To simplify and reduce the cost of financial reporting by subsidiaries while
maintaining the usefulness of their financial statements. This standard is not
applicable to the Group consolidated financial statements.
Anything not mentioned in the above table is not
relevant.
The Group does not expect that the adoption of the Standards listed above will
have a material impact on the consolidated and Company Financial Statements of
the Group and the Company in future periods, with the exception of IFRS 18
where the impact has yet to be determined.
2. Segment Reporting
Operating segments are determined by the Group's internal reporting to the
Chief Operating Decision Maker (CODM). The CODM has been determined to be the
Group's Executive Committee. The information regularly reported to the
Executive Committee for the purposes of resource allocation and the assessment
of performance, is based wholly on the overall activities of the Group. Based
on the Group's business model, the Group has determined that it has only one
reportable segment of continuing operations.
The CODM assesses the profitability of the segment based on a measure of
EBITDA and Adjusted EBITDA and is defined as follows:
• EBITDA - Calculated as Profit before Tax and IFRS 16 lease
liability interest, depreciation and amortisation. Although it is typical to
calculate EBITDA before interest, our net interest income is generated from
operational client deposits and subsequent re-investment to generate returns
for the shareholder and therefore remains included within EBITDA.
• Adjusted EBITDA - EBITDA before Non-underlying items
(Non-underlying items were referred to as Adjusting items in the prior year).
All revenue from external clients is generated through its operations located
in the UK and on that basis is wholly attributable to the UK and all
non-current assets, other than financial instruments and deferred tax assets,
are located in the UK.
a) Income
The Group derives its income as follows:
2025 2024
Income by business line from continuing operations £'000 £'000
FX ¹ 48,679 38,997
Payments ¹ 29,517 29,510
Banking services and other income ² 40,793 37,934
Total income - net of interest expense 118,989 106,441
Prior period reclassifications
(1) At the beginning of the financial year ended 31 December 2025, the Group
reassessed its client transaction classifications within the FX and Payments
segments and concluded that certain transaction more appropriately meet the
definition of Payment transactions. To improve the clarity and comparability
of the reported financial information in line with IFRS 8, income related to
these clients amounting to £2.2m has been reclassified from the FX line to
the Payments line for the 2024 comparative period.
This reclassification is presentational in nature and does not impact
previously reported profit before tax, profit for the year, earnings per
share, equity, or the statement of financial position.
(2) Refer to Note 3a for details on the reclassification of interest expense
on lease liabilities disclosed within related to Banking Services and Other
Income.
FX: Revenue categorised as FX is from clients with a need to exchange a bulk
amount from one currency for another without onward payment to another party.
The Group's FX revenue is derived from profit on settlement of FX contracts,
remeasurement of sterling balances, fair value losses on derivatives and FX
gain on payment transaction revenue. The accounting policy for the Group's Net
FX gain revenue and its components is disclosed in Note 1 (g).
Payments: The Group's payments revenue include payments FX, same currency
payments (corresponding activity income, and account management fees), pension
payments and platform revenue. Payments FX comprises of the margin derived
from bid-ask spreads on foreign currency conversion and fees paid by clients
to transfer money from or to a third party, cross borders.
Same currency relates to payment services provided for payments transacted
without an exchange of foreign currency largely relating to major market
currency clearing and includes fees for account management activities and
payments execution. Pension payments fees relate to amounts earned on
processing of pension scheme foreign currency payments. Platform revenue
relates to recurring fixed fees rather than fees earned on transaction
volumes.
Banking services and other income: The Group also generates income from trade
finance (including trade finance and letters of credit), working capital
services, interest earned from other placements with banks, interest earned
from advances to non-banks outside the Working Capital facility, interest from
staff loans, and net gains from financial assets/liabilities measured at fair
value. The Group takes client funds earmarked for other needs as client
deposits and makes short-term investment in the money market to generate gain
on money market funds.
b) Profitability
The Group measures profitability for the reporting segment on an EBITDA and
Adjusted EBITDA basis. EBITDA is useful as a measure of comparative operating
performance between both previous periods and other companies as it removes
the effect of taxation, depreciation and amortisation as well as items
relating to capital structure, while adjusted EBITDA also removes the effect
of non-underlying items.
Reconciliation of profit before tax from continuing operations to EBITDA and 2025 2024
Adjusted EBITDA
£'000 £'000
Profit before taxation 18,521 17,594
Adjusted for:
Interest expenses on lease liabilities (Note 17) 1,384 897
Amortisation (Note 18) 7,930 6,213
Depreciation (Note 16)¹ 2,690 2,320
EBITDA 30,525 27,024
Non-underlying items 4,674 3,741
Adjusted EBITDA 35,199 30,765
1 Balance includes depreciation on property, plant and equipment, and
depreciation on right of use of asset.
3. Net Interest Income
Consolidated
2025 2024
Interest income: £'000 £'000
Interest on cash and balances at central banks 22,039 29,894
Interest on loans and advances 15,170 12,993
Interest on letters of credit 1,525 1,347
Interest on interest rate swaps 130 -
Interest on investment in debt securities 16,625 14,428
Other interest income and similar income¹ 299 194
Interest income 55,788 58,857
Interest expense:
Interest on financial liabilities at amortised cost (29,179) (38,232)
Other interest expense¹ (156) (171)
Interest on interest rate swaps (444) -
Interest expense (Note 3a) (29,779) (38,403)
Total net interest income (Note 3a) 26,009 20,454
1 Other interest income and similar income and other interest expense are
interest received, interest accrued, or interest paid on the collateral
balances paid to or received from our FX Swap Counterparties.
a) Other finance costs
Consolidated
2025 2024
£'000 £'000
Interest expense on lease liabilities (Note 17) (1,384) (897)
Prior period reclassification
During the year, the Group revised its presentation of interest expense on
lease liabilities. This interest expense, previously included within the
overall 'Interest Expense' line, is now presented separately on the face of
the Statement of Profit or Loss under the heading 'Other Finance Costs' to
enhance understandability of transactions of a similar nature.
As a result, the comparative figures for the year ended 31 December 2024 have
been reclassified to conform to the current year's presentation. The
reclassification is presentational only and has no impact on previously
reported profit before tax, profit for the year, earnings per share, equity or
the condensed consolidated statement of financial position. The impact of the
reclassification on the comparative statement of profit or loss is as follows:
As previously reported Adjustment Reclassified
For the year ended 31 December 2024 £'000 £'000 £'000
Interest expense (39,300) 897 (38,403)
Net interest income 19,557 897 20,454
Total Income, net of interest expense 104,928 897 105,825
Total income 105,544 897 106,441
Other finance costs - 897 (897)
4. Net Loss On Financial Instruments Mandatorily Measured At Fair Value
Through Profit Or Loss
Consolidated
2025 2024
£'000 £'000
FX derivatives
Interest expense on FX derivative contracts (1) 1,576 247
Fair value hedge movements
Change in fair value of hedging instruments 337 -
Change in fair value of hedged risks attributable to hedged items (321) -
Cash flow hedge movements
Ineffective portion of hedge recognised immediately 24 -
Total 1,616 247
1 Hedge accounting has not been designated for the FX derivatives;
therefore, interest expense is recognised separately from interest on
financial assets measured at amortised cost. Fair value adjustments on these
contracts are recognised within Net FX gains, offsetting the economically
hedged foreign exchange movements.
5. Fees and Commissions Income
Consolidated
2025 2024
£'000 £'000
Fees and commissions income:
Account management and payments 13,685 12,868
Pension payment fees 1,666 1,556
Trade finance 977 972
Electronic platform fees - 164
FX Payment Fees 160 185
Total fees and commission income 16,488 15,745
6. Net Foreign Exchange Gain
Consolidated
2025 2024
£'000 £'000
Wholesale FX¹ 48,680 41,215
FX gain on payment transaction revenue 14,005 12,588
Total 62,685 53,803
¹ Wholesale FX income include movements arising from open foreign currency
positions amounting to a loss of £334k in 2025 (2024: gain of £472k).
7. Operating Expenses
Consolidated
2025 2024
£'000 £'000
Staff costs and Directors' emoluments
Salaries and bonuses 41,648 37,155
Share-based payments 615 996
Social security costs 5,401 4,753
Pension costs 2,683 2,701
Fees payable to the auditor
Audit
- the Company 605 711
- Group companies 1,035 731
Audit related services 236 319
Depreciation and amortisation
Amortisation of intangible assets (Note 18) 7,930 6,213
Depreciation of property, plant, and equipment (Note 16) 649 767
Depreciation of right-of-use assets (Note 17) 2,041 1,553
Other expenses
Low-value lease expenses 88 59
Clearing costs 2,640 2,441
Other bank charges 3,834 3,103
Software support/licences 8,350 7,599
Process automation costs 2,484 2,115
Professional fees 2,352 2,529
Irrecoverable VAT 1,658 1,344
Legal Fees 861 891
Recruitment 820 1,455
Travel 1,571 1,127
External Information Providers 536 495
Corporate Promotional Events and Corporate Membership 947 559
Other operating expenses 5,539 5,043
Operating expenses before non-underlying items 94,523 84,659
Non-underlying items (Note 7a) 4,674 3,741
Total operating expenses after non-underlying items 99,197 88,400
a) Non-underlying items can be analysed as follows:
The Group separately identifies results before non-underlying items. These
measures are not measures of performance under IFRS and should be considered
in addition to, and not as a substitute for, IFRS measures of financial
performance and liquidity. The Group uses its judgement to classify items as
non-underlying. Income or expenses are recognised and classified as
non-underlying when the following criteria are met:
• The item does not arise in the normal course of business; and
• The items are material by amount or nature.
Non-underlying items include other income or expenses not considered to drive
the operating results of the Group including transaction, transformational, as
well as restructuring costs. When items meet the criteria, they are recognised
and classified as non-underlying and this is applied consistently from year to
year. The balance is broken down as follows:
Consolidated
2025 2024
£'000 £'000
Transformational costs(1) 529 1,687
Transition costs ² 1,492 1,852
Redundancy costs 2,653 202
Total non-underlying items 4,674 3,741
1 Transformational costs comprise payments to consultants involved in
strategic initiatives and strategic restructuring costs (2025: £343k and
2024: £1,687k) and business setup costs (2025: £186k and 2024: £nil);
2 Transition costs relate to dual running, recruitment and settlement
agreements.
b) Number of employees
The monthly average number of full-time equivalent staff employed within the
Group, including Executive Directors, was 362 (2024: 378) and the number of
employees at year end was 366 (2024: 421).
Average number of persons employed during the year by legal entity 2025 2024
Crown Agents Bank Limited 347 364
CAB US Inc (formerly Segovia Technology Company) 3 6
CAB Europe BV 10 8
Crown Agents Global Markets 2 -
Total 362 378
8. Tax Expense
a) Analysis of tax expense for the year
i. Tax expense
Consolidated
2025 2024
£'000 £'000
Continuing operations
Current tax
Corporation tax based on the taxable profit for the year 4,859 3,726
Adjustment in respect of prior years 463 (861)
5,322 2,865
Deferred tax
Origination and reversal of temporary differences (357) 517
(357) 517
Total tax expense for the year 4,965 3,382
Effective tax rate 27% 19%
ii. Amounts recognised directly in other comprehensive income
Consolidated
2025 2024
£'000 £'000
Aggregate deferred tax arising in the year and not recognised in net profit or
loss and recognised in other comprehensive income:
Current year 24 5
Adjustment in respect of prior years - -
Deferred tax charge (Note 19) 24 5
b) Factors affecting tax expense for the year
The tax assessed for the year is higher (2024: lower) than the standard rate
of Corporation Tax in the UK.
Consolidated
2025 2024
£'000 £'000
Profit before taxation 18,521 17,594
Standard rate corporation tax of 25% on profit before taxation 4,630 4,399
Effect of:
Expenses not deductible for tax 25 124
Fixed asset differences (212) (342)
Impact of overseas tax rates 59 62
Permanent difference due to banking surcharge levy - -
Prior year adjustments 463 (861)
Total tax expense for continuing operations for the year 4,965 3,382
The Company's tax loss of £492k (2024: £1,071k) was surrendered to other
Group companies (corporation tax group relief) as permitted by HMRC. No tax
has been paid by the Company in the current year (2024: nil).
9. Cash and Balances at Central Banks
Consolidated
2025 2024
£'000 £'000
Cash and balances at central banks¹ 257,867 584,679
¹ All cash and balances at central banks are allocated as such on the
Consolidated Statement of Cash Flows and the ECL balance is nil (2024: nil).
Cash and balances at central banks include no encumbered assets (2024: £nil).
Cash and balances at central banks includes accrued interest of £522k (2024:
£1,060k).
There are no restricted amounts within cash and balances at central banks. The
cash and bank balances at central banks are measured at amortised cost as they
meet the Solely Payment of Principal and Interest (SPPI) criteria and are held
to collect contractual cash flows.
The carrying amount of these assets is equal to their fair value.
10. Money Market Funds
Consolidated
2025 2024
£'000 £'000
Open Ended Investment Companies
Morgan Stanley Euro Liquidity Fund - 25,748
Goldman Sachs USD Treasury Liquid Reserves Fund 177,635 402,594
Black Rock ICS USD Liquidity Fund - 11,971
JP Morgan USD Liquidity LVNAV Fund 18,647 7,981
BlackRock ICS US Treasury Fund Class Premier Distributing USD - 39,903
JP Morgan - EUR Liquidity LVNAV Capital Dist 21,875 -
218,157 488,197
Component of Money Market Funds included in consolidated statement of cash
flows under:
Cash and cash equivalent balances 218,157 488,197
Money Market Funds are mandatorily held at fair value through profit or loss
as they do not satisfy the SPPI criteria set out in IFRS 9. The funds are all
rated AAA (in 2025 and 2024) based on a basket of credit ratings agencies, all
approved by the Financial Conduct Authority.
11. Loans and Advances
Loans and advances are measured at amortised cost as they meet the SPPI
criteria and are held to collect (''HTC'') contractual cash flows.
Consolidated
2025 2024
£'000 £'000
Loans and advances (gross)
Loans and advances on demand to banks 129,966 185,563
Other loans and advances to banks 274,994 180,148
Other loans and advances to non-banks 21,704 32,835
Total 426,664 398,546
Less: Impairment loss allowance
Loans and advances on demand to banks (20) (4)
Other loans and advances to banks (38) (64)
Other loans and advances to non-banks (183) (239)
Total (241) (307)
Net Loans and advances on demand to banks 129,946 185,559
Net Other loans and advances to banks 274,956 180,084
Net Other loans and advances to non-banks 21,521 32,596
Net loans and advances 426,423 398,239
Component of loans and advances on demand to banks included in the
consolidated statement of cash flows under:
Cash and cash equivalents 129,946 185,559
Total 129,946 185,559
A. Collateral management
The Group's other loans and advances to banks include £5,201k of encumbered
assets (2024: £411k) in relation to derivative contracts with other financial
institutions and other balances which are all not overdue. These are not
restricted and are available for use by the counterparty.
B. Sale of trade finance loans within Other loans and advances to banks
During the year, the Group disposed of nine trade finance loan positions
within its Other loans and advances to banks (HTC) portfolio. Management
assessed the impact of the sale on the HTC model and have concluded that they
remain as HTC as sales are infrequent and insignificant and the business
model/strategy remains to be HTC.
The gain from sale amounting to £16k (2024: £nil) was recognised in the
statement of profit or loss under Other operating income. The amount is
immaterial and has therefore not been presented separately on the face of the
statement of profit or loss.
12. Derivative Financial Instruments
The tables below analyse the notional principal amounts and the positive and
negative fair values of derivative financial instruments at 31 December for
the Group. The Company does not have derivatives (2024:nil). Notional
principal amounts are the amounts of principal underlying the contract at the
reporting date.
2025 2024
Consolidated Notional principal Assets (Carrying amounts) Liabilities (Carrying amounts) Notional principal Assets (Carrying amounts) Liabilities (Carrying amounts
Foreign exchange derivatives: £'000 £'000 £'000 £'000 £'000 £'000
Total derivative assets/(liabilities) held for risk management 261,201 355 (618) 652,297 4,877 (539)
Total derivative assets/(liabilities) held for trading - - - 733 7 -
Interest rate derivative contracts:
Total derivative assets/(liabilities) 387,444 134 (766) - - -
Total derivative assets/(liabilities) 648,645 489 (1,384) 653,030 4,884 (539)
Offsetting derivative assets and derivative liabilities
Consolidated
2025 Gross amounts Net amounts presented in the balance sheet Amounts subjected on master netting arrangements¹ Cash Collateral Net amount
£'000 £'000 £'000 £'000 £'000
Financial assets
Derivative assets 489 489 (12) - 477
Financial liabilities
Derivative liabilities (1,384) (1,384) 386 4,830 3,832
Consolidated
2024 Gross amounts Net amounts presented in the balance sheet Amounts subjected on master netting arrangements¹ Cash Collateral Net amount
£'000 £'000 £'000 £'000 £'000
Financial assets
Derivative assets 4,884 4,884 (4,690) - 194
Financial liabilities -
Derivative liabilities (539) (539) 408 410 279
¹ Collateral management
The Group limits exposure to credit losses in the event of default by entering
into master netting agreements with certain market counterparties. Collateral
is exchanged under standard credit support annexes and is repayable on
termination of the related derivative positions. As required by IAS 32,
exposures are only presented net in these accounts where they are subject to
legal right of offset and intended to be settled net in the ordinary course of
business. As the Group does not presently have a legally enforceable right of
set-off, these amounts have not been offset in the balance sheet, but have
been presented separately in the table above. All derivative positions are
fully collateralised in cash, therefore the carrying amount approximates fair
value.
As at year-end, the Group had posted cash collateral of £4,830k (included in
Other Loans and Advances to banks) and held cash collateral of £nil
(included in Customer Deposits).
Foreign exchange derivatives held for economic hedging
The Group may enter into economic hedges that do not qualify for IAS 39 hedge
accounting treatment, including derivatives such as forward foreign exchange
contracts to manage currency risks of the Group as those noted in the table
above. The forward FX contracts have been transacted to economically hedge
assets and liabilities in foreign currencies and trading on behalf of clients.
The unrealised fair value movement at the statement of financial position date
is £1,873k (2024: fair value movement £5,423k). These derivative financial
instruments and the underlying transactions will mature during 2026 (2024:
mature during 2025). These derivatives are measured at fair value, with fair
value movements recognised within 'Net FX gain', consistent with the
presentation of the related foreign exchange impacts.
Interest rate derivatives held for hedging
The Group enters into derivative contracts for the purpose of hedging interest
rates. The table below summarises the notional principal amounts and carrying
values of derivatives designated in hedge accounting relationships at the
reporting date. Included in the table above are derivatives held for hedging
purposes as follows:
2025 2024
Consolidated Notional principal Assets Liabilities Notional principal Assets Liabilities
£'000 £'000 £'000 £'000 £'000 £'000
Derivatives designated as fair value hedges:
Interest rate swaps 259,644 92 (480) - - -
Derivatives designated as cash flow hedges:
Interest rate swaps 127,800 42 (286) - - -
Total derivative held for hedging 387,444 134 (766) - - -
Fair value hedges
The Group accepts customer accounts that are measured at amortised cost,
including some denominated in foreign currency. These customer accounts held
are exposed to changes in fair value due to movements in market interest
rates. To manage the interest rate risk associated with these customer
accounts, the entity enters into interest rate swaps since October 2025. The
objective is to hedge the interest rate sensitivity of these customer accounts
to changes in interest rates. In this swap, the Group would typically:
• Receive a fixed interest rate from the swap counterparty.
• Pay a floating interest rate
Possible sources of ineffectiveness include differences in the benchmark rates
of interest used to value the hedged item and the hedging instrument, such as
when cash collateralised interest rate swaps are discounted using SONIA and
SOFR but this is not the benchmark rate of interest for the hedged item.
At 31 December 2025 the Group held the following interest rate swaps as
hedging instruments in fair value hedges of interest rate risk.
Hedging instruments and ineffectiveness
2025 Changes in fair value use to calculate hedge ineffectiveness² Ineffectiveness portion recognised in profit or loss 2024 Changes in fair value use to calculate hedge ineffectiveness² Ineffectiveness recognised in profit or loss
Consolidated Notional principal Assets Liabilities Notional principal Assets Liabilities
2025 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Interest rate hedging¹
Interest rate swaps - customer accounts 259,644 92 (480) (16) (16) - - - - -
Total at year end 259,644 92 (480) (16) (16) - - - - -
1 Interest rate swaps are designated in hedges of the fair value of interest
rate risk attributable to the hedged item.
2 This represents a (loss)/gains change in fair value used for calculating
hedge ineffectiveness.
Income statement impact of fair value hedges
Consolidated
2025 2024
Net Interest income (Note 3) £'000 £'000
Interest income from the interest rate swaps 77 -
Interest expense from interest rate swaps (340) -
Ineffective portion loss (16) -
Net loss on financial assets and financial liabilities mandatorily held at
fair value through profit or loss
Change in fair value of hedging instruments 337 -
Change in fair value of hedged risks attributable to hedged items (321) -
Macro Cash flow hedges
The Group has exposure to market movements in future interest cash flows on
Cash and balances at central banks. The amounts and timing of future cash
flows, representing both principal and interest flows, are projected on the
basis of contractual terms.
The hedging strategy of the Group involves using interest rate swaps to manage
the variability in future cash flows by receiving a fixed GBP interest rate
from the swap counterparty and paying a floating GBP interest rate. This is
done on a portfolio/macro basis whereby each hedging instrument is designated
against a group of hedged items.
Possible sources of ineffectiveness are as follows:
• Differences in the benchmark rates of interest used to value the
hedged item and the hedging instrument, such as when cash collateralised
interest rate swaps are discounted using SONIA but this is not the benchmark
rate of interest for the hedged item.
• Differences in timing of cash flows between the derivative and the
hedged item.
The hedged risk is determined as the variability of future cash flows arising
from changes in the designated benchmark interest rates.
Maturity of hedging instruments
2025 2024
Consolidated Less than one month More than one month and less than one year One to five years More than five years Less than one month More than one month and less than one year One to five years More than five years
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Fair value hedges
Interest rate swap
Notional (£) 5,409 59,502 194,733
Average fixed interest rate (%) 3.88 % 3.65 % 3.38 %
Weighted average maturity days 31 days 212 days 928 days
Hedge effectiveness ratio 97.38 %
Cash flow hedges
Interest rate swap
Notional 2,663 29,287 95,850
Average fixed interest rate (%) 3.91 % 3.75 % 3.57 %
Weighted average maturity days 31 days 212 days 928 days
Hedge effectiveness ratio 99.87 %
13. Investment in Debt Securities at Amortised Cost
The Group's investment in debt securities at amortised cost consist of fixed
rate bonds issued (or guaranteed) by central and private banks and floating
rate notes. These are measured at amortised cost as they meet the SPPI
criterion and are held to collect the contractual cash flows.
Consolidated
2025 2024
£'000 £'000
Investment in debt securities at amortised cost
Balance at the beginning of the year 246,021 353,028
Purchases 708,220 211,209
Disposals - -
Redemptions (716,962) (321,926)
Exchange losses (4,571) (314)
Movement in premium/(discount) and accrued interest receivable 2,084 4,031
234,792 246,028
Less: Impairment loss allowance (2) (7)
Balance at the end of the year 234,790 246,021
The amortised cost carrying amount approximates its fair value based on market
prices.
A. Sale of GBP Capital sub-portfolio
The Group changed its interest rate risk management strategy to manage
interest rate risk using interest rate swaps instead of a natural hedge of the
debt securities. As a result, the Group sold debt securities from one distinct
portfolio which was previously used to hedge against interest rate risk on GBP
reserves. The sale, did not impact the strategy/business model of the
remaining sub-portfolios which remain hold to collect.
The gain or loss from sale amounting to £660k (2024: £nil) was recognised in
the statement of profit or loss under Other operating income. The amount is
immaterial and has therefore not been presented separately on the face of the
statement of profit or loss.
14. Investment in Debt Securities at Fair Value Through Other
Comprehensive Income
The Group holds a portfolio of floating-rate notes and fixed rate bonds issued
by investment-grade financial institutions. These instruments are managed
under a business model whose objective is both to collect contractual cash
flows and to sell financial assets to manage liquidity needs and optimise
returns. The contractual terms of the notes give rise on specified dates to
cash flows that are solely payments of principal and interest on the principal
amount outstanding.
Accordingly, the floating-rate notes are classified as debt instruments
initially and subsequently measured at fair value through other comprehensive
income (FVTOCI) in accordance with IFRS 9.
Consolidated
2025 2024
£'000 £'000
Investment in debt securities at FVTOCI
Balance at the beginning of the year - -
Purchases 447,294 -
Exchange losses (3,877) -
Movement in premium/(discount) and accrued interest receivable (739) -
Fair value adjustments 73 -
Less: Impairment loss allowance - -
Balance at the end of the year 442,751 -
15. Other Assets and Unsettled Transactions
A. Other assets
Consolidated
2025 2024
£'000 £'000
Financial assets:
Balances with mobile network operators¹ 823 1,468
Other loans 378 349
Funds paid in advance 1,819 706
Other assets 474 885
Less: impairment loss (5) (18)
Total 3,489 3,390
Non-financial assets:
VAT refund 1,532 2,592
Prepayments 4,082 3,741
Deferred tax 511 221
Total 6,125 6,554
Total other assets* 9,614 9,944
( ) 1 Balances with mobile network operators (MNOs) are due to the Group
in respect of mobile money transfers. The Group charges fees for services it
provides to aid transfer of funds by its clients to beneficiaries via mobile
money using MNOs. These balances are funds with the MNO which have yet to be
transferred to beneficiaries.
2 These balances represent amounts that are debited in advance by the
third party nostro providers at year-end and funds paid by the Group twice in
error.
Financial assets are measured at amortised cost as they meet the SPPI criteria
and are held to collect the contractual cash flows.
B. Unsettled transactions
Consolidated
2025 2024
£'000 £'000
Unsettled transactions 8,902 10,870
Less: impairment loss (2) (4)
Unsettled transactions³ 8,900 10,866
3 Unsettled foreign currency transactions that are delayed due to time
differences, public holidays in other countries (where the counterparties are
located) or similar operational reasons. The arising balances are short-term
in nature (typically less than four days) and were settled early in the
following period.
*Prior period reclassification in other assets
During the year, the Group revised the presentation of Corporate tax
receivable which was previously included within Other Assets is now presented
separately on the face of the Consolidated Statement of Financial Position
under the heading 'Current tax asset'. This change was made to enhance the
clarity and understandability of the consolidated financial statements.
Accordingly, the comparative figures for the year ended 31 December 2024 have
been reclassified to conform with the current year's presentation. The
reclassification is presentational only and has no impact on previously
reported profit before tax, profit for the year, earnings per share, equity,
or the Consolidated Statement of Financial Position.
The impact of the reclassification on the comparative Consolidated Statement
of Financial Position is as follows:
As previously reported Adjustment Reclassified
For the year ended 31 December 2024 £'000 £'000 £'000
Total non-financial assets: 15,951 (9,397) 6,554
Total other assets 19,341 (9,397) 9,944
Other assets 19,341 (9,397) 9,944
Current tax asset - 9,397 9,397
16. Property, Plant and Equipment
Consolidated
Leasehold improvements¹ Computer equipment Fixtures & fittings² Total
2025 £'000 £'000 £'000 £'000
Cost
At 1 January 2025 2,717 4,067 540 7,324
Additions 21 135 11 167
Fully depreciated asset write off (1,506) (1,322) (411) (3,239)
At 31 December 2025 1,232 2,880 140 4,252
Accumulated depreciation and impairment
At 1 January 2025 1,778 2,317 448 4,543
Charge to profit or loss 107 523 19 649
Fully depreciated asset write off (1,506) (1,322) (411) (3,239)
At 31 December 2025 379 1,518 56 1,953
Net book value
At 1 January 2025 939 1,750 92 2,781
At 31 December 2025 853 1,362 84 2,299
Consolidated
Leasehold improvements¹ Computer equipment Fixtures & fittings² Total
2024 £'000 £'000 £'000 £'000
Cost
At 1 January 2024 122 2,789 2,275 5,186
Additions 970 1,424 34 2,428
Disposals (131) (146) (13) (290)
Reclassification¹ 1,756 - (1,756) -
At 31 December 2024 2,717 4,067 540 7,324
Accumulated depreciation
At 1 January 2024 111 1,907 1,977 3,995
Charge to profit or loss 248 499 20 767
Disposals (125) (89) (5) (219)
Reclassification¹ 1,544 - (1,544) -
At 31 December 2024 1,778 2,317 448 4,543
Net book value
At 1 January 2024 11 882 298 1,191
At 31 December 2024 939 1,750 92 2,781
1 Reclassification of leasehold improvements (office fit out costs)
incorrectly classified as fixtures and fittings in FY24 by the same amount.
There is no impact to consolidated statement of profit or loss, consolidated
statement of financial position and equity.
2 Includes artwork.
No impairment charge was taken in the period (2024: £nil).
17. Leases (Group as a Lessee)
The Group has recognised right-of-use (ROU) assets and lease liabilities for
its property leases which have been accounted for as individual assets and
liabilities. The discount rates used are the incremental borrowing rates in
the range of 5.33% -7.06% (2024: 5.33% -7.06%).
The Group makes monthly/quarterly fixed payments in advance, to the lessors
for the use of the properties, and there are no variable payments. The
property leases have lease incentives, with the lease incentive receivable
being deducted from the future lease payments.
The services provided by the lessors, such as cleaning, security, maintenance,
and utilities, as part of the contract, are components which are not included
in the ROU calculation and have been expensed in the 'Other operating
expenses' line item in Note 7. These expenses amount to £929k (2024: £861k).
Dilapidation provision as at 31 December 2025 amounted to £2,017k (2024:
£1,884k) with £133k interest recognised in the statement of profit or loss
and other comprehensive income. The expected outflow of economic benefits will
be in 2034 at the end of the London Bridge lease term.
The Group's leases of low-value fixtures and equipment are expensed in the
'Other operating expenses' line item in Note 7 on a straight-line basis (see
accounting policy in Note 1 for leases). These amounted to £88k (2024:
£59k).
There were no short-term leases during the year (2024: none).
The lease terms covers only the non-cancellable lease term. There are no
purchase, extension, or termination options and residual guarantees in the
leases.
There are also no restrictions or covenants imposed by the leases.
The lease interest charged as an expense for the year totalled £1,384k (2024:
£897k).
The Company does not have any leases and had no lease payments under
non-cancellable operating leases during 2025 (2024: ).
a) Right-of-use assets
All the Group's right-of-use assets are non-current assets. A reconciliation
of the Group's right-of-use assets as at 31 December 2025 and 31 December
2024 are shown below:
Consolidated
Leasehold property¹
£'000
Cost
At 1 January 2025 19,061
Additions -
At 31 December 2025 19,061
Accumulated depreciation
At 1 January 2025 1,307
Charge to profit or loss¹ 2,041
At 31 December 2025 3,348
Net book value
At 31 December 2025 15,713
Cost
At 1 January 2024 1,760
Additions 19,061
Lease assignment (695)
At 31 December 2024 20,126
Accumulated depreciation
At 1 January 2024 1,071
Charge to profit or loss¹ 1,553
Lease assignment (252)
At 31 December 2024 2,372
Net book value
At 31 December 2024 17,754
1 There is only one class of right-of-use assets which are the property
leases.
The Directors consider ROU assets for indicators of impairment at least
annually, or when there is an indicator of impairment. There are no physically
visible impairment indicators on the leased properties at year-end.
Refer to Note 18 for further details on impairment.
No impairment charge was taken during the year (2024: nil).
b) Lease liabilities
A reconciliation of the Group's remaining operating lease payments as at
31 December 2025 and 31 December 2024 are shown below:
Consolidated
Leasehold property
£'000
Lease liabilities as at 1 January 2025 18,069
Payments during the year¹ (238)
Foreign exchange revaluation (45)
Add: interest on lease liabilities 1,251
At 31 December 2025 19,037
Lease liabilities as at 1 January 2024 884
Additions during the year 17,264
Payments during the year¹ (328)
Lease assignment (628)
Foreign exchange revaluation 63
Add: interest on lease liabilities 814
At 31 December 2024 18,069
1 Payments during the year include payments for interest on lease
liabilities and the repayment of the principal portion of the lease liability.
There were no variable lease payments expenses in the reporting period (2024:
£nil).
The Group's lease liabilities as at 31 December 2025 and 31 December 2024
are split into current and non-current portions as follows:
Consolidated
2025 2024
£'000 £'000
Non-current 17,035 16,681
Current 2,002 1,388
Lease liabilities 19,037 18,069
c) Impact on the profit and loss
The following are the amounts recognised in profit or loss:
Consolidated
2025 2024
£'000 £'000
Depreciation expense of right-of-use assets (Note 7) 2,041 1,553
Interest expense on lease liabilities (Note 3) 1,384 897
Impact of lease assignment - (21)
Expense relating to leases of low-value assets (Note 7) 88 59
Total amount recognised in profit or loss 3,513 2,488
The Group had total cash outflows for all leases of £266k (2024: £328k).
18. Intangible Assets
Consolidated
Goodwill Core accounting Other software Brand/name Total
software
£'000 £'000 £'000 £'000 £'000
Cost
At 1 January 2025 5,919 5,922 44,150 1,483 57,474
Additions - 198 8,318 55 8,571
Impairments - (76) - - (76)
Fully amortised asset write off - - (1,964) - (1,964)
At 31 December 2025 5,919 6,044 50,504 1,538 64,005
Accumulated amortisation and impairment
At 1 January 2025 - 4,557 22,093 219 26,869
Charged for the year - 696 7,183 51 7,930
Fully Amortised Asset Write Off - - (1,964) - (1,964)
Exchange rate loss - - - - -
At 31 December 2025 - 5,253 27,312 270 32,835
Net book value
At 1 January 2025 5,919 1,365 22,057 1,264 30,605
At 31 December 2025 5,919 791 23,192 1,268 31,170
Consolidated
Goodwill Core accounting Other software Brand/name Total
software
£'000 £'000 £'000 £'000 £'000
Cost
At 1 January 2024 5,919 5,872 31,653 1,483 44,927
Additions - 855 11,669 - 12,524
Reclassification of software from core to non-core - (805) 805 - -
Exchange rate loss - - 23 - 23
At 31 December 2024 5,919 5,922 44,150 1,483 57,474
Accumulated amortisation
At 1 January 2024 - 4,428 16,038 167 20,633
Charged for the year - 437 5,724 52 6,213
Reclassification of software from core to non-core - (308) 308 - -
Exchange rate loss - - 23 - 23
At 31 December 2024 - 4,557 22,093 219 26,869
Net book value
At 1 January 2024 5,919 1,444 15,615 1,316 24,294
At 31 December 2024 5,919 1,365 22,057 1,264 30,605
Software that does not result in an intangible asset (right to receive access
to the supplier's application software in the future is a service contract) of
the Group are expensed. Software expensed in the period amounts to £5,139k
(2024: 3,790k).
Internally generated assets include payment-related software that is created
and utilised in the Group's operation.
Internally generated intangible assets are disclosed within Other software
and amounts to £15,666k (2024: £10,508k).
There are no other individual purchased intangible assets that are considered
material to each class of intangible assets (2024: none).
Individually material intangible assets internally generated:
2025 2024
Carrying amount Remaining Carrying amount Remaining
£'000 Useful life £'000 Useful life
FX derivatives platform 3,120 48 months 2,361 60 months
New Transaction Monitoring System 1,595 41 months 1,688 53 months
All intangible assets (except Goodwill) have finite lives - see Note 1 for
accounting policies on the amortisation method and useful lives.
Other software held by the Group includes software relating to the payments,
process/platform, compliance, and banking.
Goodwill
The goodwill relates to the acquisitions:
• by the Company, on 31 March 2016, of the entire share capital of
both CAB, a regulated bank
• by the Group, on 1 July 2019, of the entire share capital of CAB
US Inc, a US- based fintech company
• CGU: goodwill relating to the acquisitions of both CAB and CAB US
Inc. is allocated to CAB being the Group's only cash-generating unit. The
carrying amount of goodwill has been allocated to the one operating segment
for all periods. The CGUs are determined at Company level because specific
revenue streams can not be attributed to individual assets.
The goodwill is tested for impairment at the CGU level. Impairment reviews
were performed on the carrying values of all goodwill and intangible assets as
follows:
• Goodwill and other intangible assets: reviewed against a value in
use calculation of CAB, the cash-generating unit.
The Group tests goodwill and intangible assets annually for impairment, or
more frequently if there are indications that the assets might be impaired.
The decrease in the market capitalisation below the net asset value of the
Company as at 31 December 2025 was identified as a potential impairment
indicator and as required by IAS 36, an impairment assessment was performed.
The value in use that has been used for the impairment assessment of Goodwill
and Intangible Assets also applies to PPE (Note 16), ROU Assets (Note 17), and
the parent's Investments in Subsidiary Undertakings.
Value in use
The recoverable amounts of the cash-generating units are based on value in use
calculations which use cash flow projections based on financial budgets
approved by the Board of Directors covering a three-year period ending 31
December 2028, with the terminal growth rate applied from the start of 2028.
i. Discount rate
The Group uses a post-tax discount rate based on the WACC on 10.5% (2024: 9%)
in line with requirements of IAS 36.
ii. Cash flows
The future cash flows of the CGUs are the cash flows projected for a
three-year period for which detailed forecasts are available and utilise
assumptions regarding the long-term pattern of sustainable cash flows
thereafter. Forecasts are compared with actual performance and verifiable
economic data, but they reflect management's view of future business prospects
at the time of the assessment.
iii. Terminal growth rate
The terminal growth rate remains unchanged at 2% being an industry realistic
benchmark based on the UK long-term inflation rate target..
iv. Sensitivity analysis of key assumptions in calculating value in use
The Group has conducted an analysis of the sensitivity of the impairment test
to changes in the key assumptions (i.e cash flows, growth rate and the
discount rate) used to determine the recoverable amount for the CGU to which
goodwill and intangible assets, PPE, ROU and investment in subsidiaries are
allocated. The Group believes that any reasonably possible change in the key
assumptions on which the recoverable amount of the CGU is based would not
cause the aggregate carrying amount of the assets to exceed the aggregate
recoverable amount of the related CGUs.
19. Deferred Tax
a) Deferred tax liability
The deferred tax liability recognised in the consolidated financial statements
is as follows:
Consolidated
Property, plant and equipment Investment in equity Intangible assets Total
Deferred tax liability 2025 £'000 £'000 £'000 £'000
At 1 January 2025 118 41 1,058 1,217
(Credit) to profit and loss 2025 (202) - (111) (313)
Charge to other comprehensive income 2025 - 24 - 24
At 31 December 2025 (84) 65 947 928
Deferred tax liability 2024
At 1 January 2024 115 36 544 695
Charge/(Credit) to profit and loss 2024 3 - 514 517
Charge to other comprehensive income 2024 - 5 - 5
At 31 December 2024 118 41 1,058 1,217
The deferred tax liability can be further analysed as follows:
Consolidated
2025 2024
£'000 £'000
Liability reversing at 25% 928 1,217
At 31 December 2025 928 1,217
b) Deferred tax recognised in the year
Consolidated
2025 2024
£'000 £'000
Accelerated tax depreciation on property, plant and equipment (202) 3
Intangible assets (111) 514
Expected credit loss provision - -
Total tax expense to profit or loss¹ (313) 517
Charged to other comprehensive income:
Deferred tax expense on investment on equity securities 24 5
Total deferred tax expense in other comprehensive income 24 5
Total deferred tax charge for the year (289) 522
1 Includes a deferred tax asset credit of £nil (2024: £nil).
20. Customer Accounts
Consolidated
2025 2024
£'000 £'000
Repayable on demand 684,342 676,720
Other customers' accounts with agreed maturity dates or periods of notice by
residual maturity repayable:
3 months or less 710,873 845,081
1 year or less but over 3 months 41,318 63,199
2 years or less but over 1 year - -
1,436,533 1,585,000
Customer accounts are accounts that customers hold with the Group. A
substantial proportion of customer accounts are easy access accounts that,
although repayable on demand, have historically formed a stable deposit base.
Customer accounts also include cash collateral from customers amounting to
£7,400k (2024: £17,806k) held by the Group in respect of the assets'
underlying financial guarantees and letters of credit. These are not
restricted cash and are available for use by the Group.
21. Provisions
Consolidated
2025 2024
£'000 £'000
Expected credit loss for off balance sheet balances:
Financial guarantee liability - 1
Liability for letter of credit confirmations/bill acceptances 1 2
Working capital facilities - undrawn commitments 36 62
ECL for off balance sheet balances 37 65
Dilapidation provision for the London Bridge Lease (Note 17)¹ 2,017 1,884
Provisions 2,054 1,949
1 The dilapidation provision includes accrued interest of £133k (2024:
£84k) which was recognised in the statement of profit or loss and other
comprehensive income. The expected timing of any resulting outflows of
economic benefits on the dilapidation provision is 2034 which is the end of
the lease term for the London Bridge lease.
i. Financial guarantee contracts
A financial guarantee contract is a contract that requires the issuer to make
specified payments to reimburse the holder for a loss it incurs because a
specified debtor fails to make payments when due in accordance with the terms
of a debt instrument. The Group provides financial guarantees to multiple
counterparties. The Group received premiums of £58k (2024: £5k).
ii. Letter of credit confirmations/bill acceptances
A letter of credit confirmation/bill acceptance is a letter from an issuing
bank guaranteeing that a buyer's payment to a seller will be received on time
and for the correct amount. The Group confirmed the letters of credit issued
by an issuing bank and charged fixed fees which are received either in advance
or at a later date. The Group provides these acceptances to multiple
counterparties. The Group received premiums of £826k (2024: £967k).
The uncertainties relating to the amount or timing of any outflow are those
inherent within the products concerned, notably that the relevant counterparty
will not carry out its obligations. Cash collateral of £7,400k (2024:
£17,806k) was held by the Group in respect of the assets' underlying
financial guarantees and letters of credit noted above. This cash is not
restricted and is available for use by the Group.
iii. Working Capital facilities - undrawn commitments
Working Capital is a credit facility offered by the Group to its clients. The
Group charges a facility fee for provision of each facility when drawn down.
The Group provides this facility to multiple counterparties. The Group
received facility fees of £nil (2024: £40k).
22. Called Up Share Capital
2025 2024
Number of ordinary shares '000 '000
Authorised, allotted, issued, and fully paid (Ordinary Shares) 254,143 254,143
2025 2024
Ordinary share balance £'000 £'000
As at beginning of the year 85 85
Total share capital - at year-end 85 85
There are no restrictions on the distribution of dividends and the repayment
of capital.The nominal value per share is 0.033pence.
There were no changes to the ordinary share capital and the number of shares
in issue during the year ended 31 December 2024.
A. Merger relief reserve
The Company's merger relief reserve was created on acquisition of additional
interest in its subsidiary, CTH, in 2023. Following the liquidation of CTH
during the year, the reserve was transferred to Retained earnings (2024:
£100,442k).
23. Notes to the Statement of Cash Flows
i. Reconciliation of profit before taxation to net cash outflow from operating
activities
Consolidated
2025 2024
£'000 £'000
Profit before taxation
Continuing operations 18,521 17,594
Adjusted for non-cash items:
Amortisation 7,930 6,213
Depreciation
- Right of use of assets 2,041 1,553
- Property, plant and equipment 649 767
Share-based payment charge 615 996
Effective interest rates - (89)
(Profit)/loss on write-off of:
- Property, plant and equipment - 71
- Right of use assets - (184)
Interest accrued on lease liabilities 1,251 814
Impairment of intangible assets 76 -
Intangible assets accrued (932) -
Property, plant and equipment accrued (33) -
Effect of currency exchange rate change¹ (431) (1,219)
Net movement in FX derivatives (23,865) -
Effect of other non-monetary transactions (195) (20)
5,627 26,496
Changes in working capital:
Net increase in loans and advances to banks other than on demand (100,754) (44,349)
Net (decrease)/increase in customer accounts (71,626) 27,634
Net (increase)/decrease in investment in debt securities (441,578) 107,553
Net decrease/(increase) in other loans and advances to non-banks 5,983 (24,031)
Net (increase)/decrease in unsettled transactions (12,435) 12,643
Net decrease in other assets 888 243
Net decrease in other liabilities (1,494) (1,718)
Net (increase)/decrease in accrued income (1,108) 290
Net decrease/(increase) in accruals 3,071 (7,987)
Net cash (outflow)/generated from operating activities² (613,426) 96,774
1 Effects of currency exchange rate change include the fair value
(loss)/gain on derivatives which is disclosed in Note 6.
2 Cash flows from operating activities include interest received of
£53,877k (2024: £59,582k) and interest paid of £31,683k (2024: £47,167k).
i. Non-cash transactions - Consolidated
Non-cash transactions from investing activities for the Group during the year
include acquisition of right-of-use assets amounting to £nil (2024:
£19,061).
ii. Changes in liabilities arising from financing activities
The Group's changes in lease liabilities are detailed in Note 17. There are no
other changes in liabilities from financing activities.
24. Related Parties
The immediate parent undertaking of the Company which had control2024 up to 6
July 2023 was Merlin Midco Limited. As at the year end Merlin Midco Limited's
ownership was 45.1% (2024: 45.1%), which is held by a nominee company Diagonal
Nominees Limited and has the highest shareholding. As such no company is
required to consolidate these financial statements this year (2024: no company
consolidated the entity).
The related party transactions (which were all at arm's length and were
transacted at market prices) are as follows:
a) Remuneration of key management personnel (including Executive Directors)
The remuneration of the Group's key management personnel is set out below in
aggregate for each of the categories specified in IAS 24 Related Party
Disclosures.
Consolidated
2025 2024
£'000 £'000
Short-term employee benefits (including bonuses and Employer's NICs) 8,344 4,393
Post-employment benefits 65 141
Share-based payments 365 457
Total remuneration 8,774 4,991
In 2025, no contributions were made by the Group on behalf of Directors to a
defined contribution pension scheme. In 2024, £45k such contributions were
made by the Group on behalf of two Directors and this was included in the
table above . In 2025, no retirement benefits accrued for any Director (2024:
£nil) under a defined benefit pension scheme.
The aggregate emoluments (including pension contributions and exit
compensation) of the Group's key management (excluding Directors) were
£4,957k (2024: £2,908k).
The aggregate emoluments (including share-based payment charge) and accrued
pension contributions of the highest paid Director in the Group were £964k
(2024: £578k) and £nil (2024: £nil) per annum respectively.
b) Company related party balances
In addition to the above related party transactions and balances of the Group,
the Company had outstanding balances with the following intercompany entities
within the Group as at 31 December 2025:
1. £14,174k (2024: £18,262k) payable to CAB. The amount relates to the
payments made by CAB on behalf of, or recharged to the Company.
2. The Company holds a bank account with CAB with a year-end balance of
£249k (2024: £108k).
25. Contingent Liabilities and Commitments
a) Contingent liabilities
The Group and the Company do not have contingent liabilities at the balance
sheet date.
b) Commitments
In 2025, the Group entered into a one-year contract to assist with the ongoing
automation of manual processes. The following payments are due under the
contract:
2025 2024
Payment Due £'000 £'000
Not later than one year 973 1,883
Later than one year and not later than five years - -
973 1,883
The total of the amounts due under the contract are expensed to the
consolidated statement of profit or loss over the life of the contract in line
with the benefits received.
Further commitments are discussed in Note 17 and Note 21.
26. Liquidity Risk
Information relating to the liquidity risk policy is provided in the Strategic
Report. The undiscounted liquidity cash flow profile of the Group's financial
liabilities (including interest receivable/payable on maturity) is as follows:
Consolidated
Less than 3 months 3 months 1 year More than
or on demand - 1 year - 5 years 5 years Total
Liabilities 2025 £'000 £'000 £'000 £'000 £'000
Non-derivative liabilities
Customer accounts 1,395,212 41,321 - - 1,436,533
Unsettled transactions 20,772 - - - 20,772
Other liabilities 3,098 - - - 3,098
Accruals 13,451 - - - 13,451
Lease liabilities 838 2,485 16,028 5,579 24,930
Total 1,433,371 43,806 16,028 5,579 1,498,784
Derivative liabilities
Derivative financial instruments 1,384 - - - 1,384
Consolidated
Less than 3 months 3 months 1 year More than
or on demand - 1 year - 5 years 5 years Total
Liabilities 2024 £'000 £'000 £'000 £'000 £'000
Non-derivative liabilities
Customer accounts 1,523,028 64,138 - - 1,587,166
Unsettled transactions 35,115 - - - 35,115
Other liabilities¹ 3,299 - - - 3,299
Accruals 10,380 - - - 10,380
Lease liabilities 108 289 13,375 11,656 25,428
Total 1,571,930 64,427 13,375 11,656 1,661,388
Derivative liabilities
Derivative financial instruments 539 - - - 539
1 Excludes non-financial liabilities such as HM Revenue & Customs.
27. Interest Rate Risk
Interest Rate Risk in the Banking Book (IRRBB) is assessed and measured on a
behavioural basis by applying behavioural assumptions including those for the
behaviour of non-maturity deposits and the investment of capital. This
assessment is performed across a range of regulatory prescribed and internal
interest rate shock scenarios IRRBB is measured through a combination of
economic value and earnings-based measures:
• Economic value sensitivity - a range of interest rate
scenarios is applied to assess a change in market value of assets, liabilities
and off-balance sheet items repricing at different times for an unexpected
change in interest rates.
• Net interest income sensitivity - impact on earnings
over a defined period of an unexpected change in interest rates.
These measures are monitored at least monthly and were as follows at 31
December:
2025 2024
Economic Value (consolidated) £'000 £'000
+ 200bp parallel shift in yield curve¹ (1,570) 8,165
- 200bp parallel shift in yield curve¹ 1,579 (8,826)
Net interest income sensitivity (12-month period)
+100bp parallel shift in yield curve 1,706 8,795
- 100bp parallel shift in yield curve (1,706) (8,795)
(1 ) 2024 economic value sensitivity has been restated to reflect the
behaviouralisation of non-maturity deposits (previously included on a
contractual repricing basis). The decrease in sensitivity for both the
economic value and net interest income metrics is as a result of the
structural hedge of non-maturity deposits implemented in 2025 protecting the
Group against unexpected downward shocks in interest rates.
( )
28. Earnings Per Share
The calculation of the basic and diluted earnings per share at the reporting
date is based on the following data:
Consolidated
2025 2024
Earnings attributable to owners of the Group: £'000 £'000
Continuing operations 13,556 14,212
13,556 14,212
2025 2024
Weighted average number of ordinary shares £'000 £'000
Weighted average number of ordinary shares for basic earnings per share 254,143 253,863
Effect of dilutive share awards¹ 6,595 280
Weighted average number of ordinary shares for diluted earnings per share 260,738 254,143
1 This comprises the 2025 LTIP awards expected to vest as the targets have
been assessed as achievable. The awards for the 2023 and 2024 LTIP schemes
are not expected to vest and therefore, do not have a dilutive effect.
The basic and diluted earnings per share are as follows:
2025 2024
pence pence
Basic and diluted earnings per share
Basic EPS 5.4 5.6
Diluted EPS 5.2 5.3
29. Events after the Reporting Period
On the 2 March 2026 the Helios Consortium announced its firm intention to
make an offer for the entire issued and to be issued share capital of CAB
Payments (excluding the shares already owned or controlled by Helios Fund III)
at the price of USD 1.15 per CAB Payments share in cash, together with an
unlisted, illiquid, non-voting share alternative. The independent Board has
had direct dialogue with Helios and has continued to engage extensively with a
significant number of the Company's larger shareholders. Following this
engagement, the Independent Board believes that the offer is highly
opportunistic and fundamentally undervalues CAB Payments and its future
prospects.
There were no other events after the reporting period requiring disclosure or
further adjustments to the financial information.
Directors responsibility statement
Each of the Directors Ann Cairns, Neeraj Kapur, James Hopkinson, Noel
Harwerth, Dr Caroline Brown, Susanne Chishti, Jennifer Johnson-Calari, Karen
Jordan, Peter Klein, Henry Obi, Kushagra Saxena, Nitin Kaul confirm that, to
the best of their knowledge:
a) the group and company financial statements, which have been prepared in
accordance with UK-adopted international accounting standards, give a true and
fair view of the assets, liabilities and financial position of the group and
company, and of the profit of the group; and
b) the 'Overview' and 'Strategic Report' includes a fair review of the
development and performance of the business and the position of the group and
company, together with a description of the principal risks and uncertainties
that it faces.
Alternative Performance Measures
CAB Payments uses alternative performance measures (APM) when presenting its
financial results. Management believe these provide stakeholders with
additional useful information to interpret the underlying performance of the
business. They are used by the Directors and management to monitor
performance.
APMs used within this annual report are supplemental to, but not a substitute
for, IFRS measures presented within the Financial Statements. They may not be
comparable with the APMs of other companies. The APMs are calculated on the
same basis as the prior year.
EBITDA
The key measure of profitability used internally at Executive Committees and
Board, and externally with investors.
It is calculated as Profit before Tax and IFRS 16 lease liability interest
expense, depreciation and amortisation. Although it is typical to calculate
EBITDA before interest, our net interest income is generated from client
deposits and subsequent reinvestment to generate returns for shareholders and
therefore remains included within EBITDA.
The calculation for EBITDA can be seen in Note 2 Segment reporting.
Adjusted EBITDA and Adjusted EBITDA Margin
The Group believes that Adjusted EBITDA is a useful measure for investors
because it is closely tracked by management to evaluate the Group's
performance for making financial, strategic and operating decisions, as well
as aiding investors to understand and evaluate the underlying trends in the
Group's performance period on period, in a comparable manner.
Adjusted EBITDA margin is another measure of profitability, by understanding
how much of the income is converted to profit, by calculating Adjusted EBITDA
as a percentage of total income.
Adjusted EBITDA Reference 2025 2024
£'000 £'000
Note 2 A 30,525 27,024
Add back: Non-underlying items Note 7a) B 4,674 3,741
Adjusted EBITDA A+B 35,199 30,765
2025 2024
Adjusted EBITDA margin Reference £'000 £'000
Adjusted EBITDA Table above A 35,199 30,765
Gross income (defined as total income, net of interest expense) Consolidated Statement of Profit or Loss B 118,989 106,441
Adjusted EBITDA margin A / B 30% 29%
Adjusted Profit, Earnings Per Share and Adjusted Earnings per Share
A measure of profitability based on adjusting the statutory profit after tax
by removing identified items that do not form part of the ongoing running
costs of the business.
2025 2024
Adjusted Profit After Tax Reference £'000 £'000
Profit Before Tax Consolidated Statement of Profit or Loss A 18,521 17,594
Add back: Non-underlying items Consolidated Statement of Profit or Loss B 4,674 3,741
Adjusted Profit Before Tax C = A+B 23,195 21,335
Adjusted Tax (at standard rates: 2024: 25%) D (5,799) (5,334)
Adjusted Profit After Tax E = C-D 17,396 16,001
Number of Shares Note 22 F 254,143,218 254,143,218
Adjusted basic Earnings Per Share (£) E / F 0.068 0.063
Operating Free Cash Flow and Free Cash Flow conversion
A measure of cash flow generated by the business. It is a non-statutory
measure used by the Board and the senior management team to measure the
ability of the Group to support future business expansion, distributions, or
financing. It is calculated as Adjusted EBITDA before the cost of purchasing
property, plant and equipment, the cost of intangible asset additions, and the
cost of lease payments. The Group also measures free cash flow conversion,
being operating free cash flow as a percentage of Adjusted EBITDA.
2025 2024
Operating free cash flow: Reference £'000 £'000
Adjusted EBITDA Note 2b) A 35,199 30,765
Less: additions of tangible fixed assets Consolidated Statement of Cash Flows (134) (2,428)
Less: additions of intangible fixed assets Consolidated Statement of Cash Flows (7,639) (12,524)
Less: cash payments made on property leases Note 17b) (238) (328)
Operating free cash flow B 27,188 15,485
Operating free cash flow conversion B / A 77% 50%
Alternative Interest Income
The Group measures and monitors net interest income by its underlying
commercial driver, which enables evaluation of performance in consideration of
return on capital deployed and product profitability. This is done by
capturing interest income by source and spreading the interest expense through
an internal transfer pricing mechanism.
Twelve Months Ended 31 December:
2025 2024
Alternative Interest Income: Reference £'000 £'000
Net interest income Consolidated Statement of Profit or Loss 26,009 20,454
Gains on money market funds Consolidated Statement of Profit or Loss 14,688 16,070
Net loss on financial assets and financial liabilities mandatorily held at Consolidated Statement of Profit or Loss (1,616) (247)
fair value through profit or loss
Total 39,081 36,277
Net interest income from cash management 32,192 31,772
Trade finance net interest income 5,105 3,640
Working capital facilities net interest income 1,784 865
Total 39,081 36,277
Adjusted cost - income ratio
The Cost-Income ratio measures operating efficiency and is calculated as
operating expenses before non-recurring expenses divided by total operating
income, expressed as a percentage. It indicates how much operating cost is
incurred to generate one unit of operating income; a lower ratio reflects
greater efficiency.
Twelve Months Ended 31 December:
2025 2024
Cost - Income Ratio Reference £'000 £'000
Operating expenses excluding Non-underlying items Consolidated Statement of Profit or Loss 94,523 84,659
Operating Income Consolidated Statement of Profit or Loss 118,989 106,441
Cost-income ratio 79 % 80 %
Key performance indicator definitions
In 2025, the Group reviewed its key performance indicators (KPIs) to ensure
they remain aligned with the Group's strategic priorities and provide
stakeholders with more meaningful insights into performance. As a result of
this review, the Group replaced the Capital and Capital Surplus, Operating
free cash flow and conversion, number of currencies and Income per client KPIs
with the Cost-Income ratio, Earnings per share (EPS) and Adjusted EPS, Average
deposits and Adjusted EBITDA per full-time equivalent employee to align with
the newly formed performance measures. These measures reflect how management
monitor and track performance of the business throughout the year. The rest of
the KPIs remained the same and are defined as follows:
Wholesale FX and Payment FX volumes (2024 KPI)
The FX business is reported across a number of products: Wholesale FX, Payment
FX, and Pension FX. This income is measured collectively by the Group as the
underlying economic drivers are broadly the same. The income, volume, and
margins are all measured and monitored, along with the underlying currencies,
to help the Group understand broader income performance.
The reported figures represent the accumulated income from all trades
undertaken during the year, where the income of a single transaction has been
generated from the bid/ask spread and any associated fees if the converted
funds are then paid to a third-party beneficiary.
Wholesale FX and Payment FX income is the same as the Net Foreign Exchange
gain reflected in the Consolidated Statement of Profit or Loss.
Number of Unique Active Clients (2024 KPI)
The Group measures the number of unique clients and their associated value to
the organisation, in order to understand the impact through the organisational
operations. A key element of success for the Group is to continue to bring on
board new clients to help grow the top line Total Income. The number of unique
clients is derived at a Group entity level, that contributed revenue in the
preceding 12 months across any of the CAB Payments product offering. The Group
is focused on a higher quality of earnings from its client base, ensuring that
it maximises share of wallet and ensuring a cost-effective client
relationship, with a particular focus on ensuring all clients generate more
than £100k per annum.
Number of banking partners (2024 KPI)
The Group counts and measures its number of Banking Partners to understand the
fortification of our global payment capability and the support there is for
the FX specialism. The strategic aim is to continue to grow Banking Partners,
either in the markets we currently serve, to provide competitive pricing, or
to bring online new markets.
Development Aid Flows (2024 KPI)
This is the subsection of the Wholesale and Payment FX volumes from
International Developed Organisations into Emerging Markets.
Gender Diversity in Management (2024 KPI)
The Board and Senior Management are committed to driving diversity and
equality in the workforce, and do this through measurement of gender diversity
at management level, which is defined as: number of female Vice President
(VP), Senior Vice President (SVP), Directors (D), Managing Directors (MD), and
Executive Vice President (EVP) (excludes Board) as a percentage of the overall
FTE within those same corporate grades.
KPIs introduced in 2025
Adjusted EPS and Adjusted Cost: Income ratio are New KPIs and have been
defined above under APMs
Reported profit and EPS are statutory measures
Adjusted EBITDA per Average FTE (New KPI)
Adjusted EBITDA per Average FTE measures productivity and is calculated as
Adjusted EBITDA divided by the average number of full-time equivalent
employees (FTEs) during the period. It indicates the level of earnings
generated per employee, adjusted to exclude items not considered part of
underlying operating performance.
Average deposits (New KPI)
Average deposits comprise the month on month average deposits throughout the
year.
Glossary
In the annual report and accounts, the 'Group' or 'CAB Payments' refers to CAB
Payments Holdings plc and its subsidiaries, the 'Company' or 'CPH' refers to
CAB Payments Holdings plc, 'CAB' refers to Crown Agents Bank Limited, and
'CTH' refers to CAB Tech HoldCo Limited, a 100% subsidiary of the Company.
The following definitions apply throughout this document unless the context
requires otherwise:
Active Client A client that has generated income within the last 12 months
Addressable Market The market addressable by the Group, comprising primarily developed to
emerging markets flows, excluding non-LCU flows and non-focus geographies
Admission The ordinary shares of the Company were admitted to the premium listing
segment of the Official List of the FCA and to trading on the Main Market of
the London Stock Exchange on 11 July 2023
ALCO Assets and Liabilities Committee
AML/CTF laws Laws and regulations relating to corrupt and illegal payments,
counter-terrorism financing, anti-bribery and corruption and adherence to
anti-money laundering obligations, as well as laws, sanctions and economic
trade restrictions relating to doing business with certain individuals, groups
and countries
APAC Asia Pacific Region
API The Group's EMpower FX application programming interface
APM Alternative Performance Measures as defined on pages to
B2B Business to Business
Banking Services One of the Group's three business lines
BEIS Department for Business, Energy & Industrial Strategy
BN Billion, i.e. 1,000 million
BRICS BRICS is an intergovernmental organisation comprising Brazil, Russia, India,
China, South Africa, Egypt, Ethiopia, Iran, and the United Arab Emirates.
CAB Crown Agents Bank Limited, a regulated subsidiary of the Group
CABE CAB Europe BV, a regulated Group subsidiary based in the Netherlands
CAGR Compound Annual Growth Rate
CAIM Crown Agents Investment Management Limited, a wholly owned subsidiary of the
Company until it was sold on 31 March 2023
CAPEX Expenditures made for goods or services that are recorded on a company's
balance sheet
CBS Core Banking System, the Group's banking software
CCY Currency
CD Certificate of deposits
CEO Chief Executive Officer
CET1 Common Equity Tier 1
CFO Chief Financial Officer
CGU Cash generating unit
CHIPS Clearing House Interbank Payments System
CRD IV Capital Requirements Directive IV
CRR the Capital Requirements Regulation (Regulation (EU) 575/2013)
CRWA Credit risk weighted assets
CSA Credit support annex
CSR Corporate Social Responsibility
CTO Chief Technology Officer
CTM Collateralised mark to market
Currency corridor Specific combinations of sending currency and receiving currency pairs, or, in
some cases, country combinations
D Corporate title: Director
DEFRA Department for Environment, Food & Rural Affairs
EAD Exposure at default
EBT Employee benefit trust
ECL Expected Credit Loss
EIR Effective interest rate
Emerging FX Markets other than developed markets
EMFI Emerging Market Financial Institutions
ERMF Enterprise Risk Management Framework
ESG Environmental, Social and Governance
EU European Union
EVP Corporate title: Executive Vice President
FCA Financial Conduct Authority
FDI Foreign Direct Investment
FinTech Financial Technology
FIT Forward-in-time
FTEs Full Time Employees, including temporary contractors and consultants filling
in for permanent roles
FVTOCI Fair value through other comprehensive income
FVTPL Fair value through profit and loss
FX Foreign Exchange. When referring to the Group's services, it refers to one of
the Group's business lines, including the Group's spot foreign exchange
trading services
G10 Belgium, Canada, France, Italy, Japan, the Netherlands, the United Kingdom,
the United States, Switzerland and the central banks of Germany and Sweden
GDP Gross Domestic Product
GHG Greenhouse Gas
GUI the Group's EMpower FX graphical user interface
Helios Helios Investment Partners
HQLA High Quality Liquid Assets
HTC portfolio Held-to-Collect Portfolio
IAS International Accounting Standard
ICAAP Internal Capital Adequacy Assessment Process
IDO International Developmental Organisation
IFRS UK-adopted international accounting standards
ILAAP Internal Liquidity Adequacy Assessment Process
IMTO International Money Transfer Operator, a licence provided by the Central Bank
Of Nigeria
Indirect Nostro A bank account held by CAB with another bank who then relies on a domestic
bank denominated in a foreign currency
IPO Initial Public Offering
IRRBB Interest rate risk in the banking book
JCF JCF Nominees Limited, a wholly owned subsidiary of the Company until it was
sold on 31 March 2023
KPI Key Performance Indicator
KYC Know Your Customer
LATAM Latin America region
LCR Liquidity Coverage Ratio
LGD Loss given default
Local Bank Account Network Demand accounts in the Group's name held with various local banks across the
globe which provide the Group with direct access to local currency where it
has such deposits
LTIP Long term incentive plan
LSE London Stock Exchange
MENA Middle East and North Africa
MMB Major Market Banks
M Million
MD Corporate title: Managing Director
MNO Mobile network operator
MTM Mark to market
NBFI Non-Bank Financial Institution
NCI Non-controlling interest
Netting The practice of using funds received from one customer to fulfil an order in
that same currency from another customer in order to capture both bid and ask
spreads on the transaction
NGO Non-Governmental Organisation
Non-LCU Non-local currency, cross-border payments that take place with no FX
transaction
Nostro A bank account held by CAB in another country, denominated in a foreign
currency
NRR Net revenue retention
NSFR Net Stable Funding Ratio
NXX Nigerian Naira (NGN), Central African Franc (XAF) and West African Franc (XOF)
OCI Other comprehensive income
OECD countries The 38 member countries of the Organisation for Economic Co-operation and
Development
OLAR Overall Liquidity Adequacy rule
Payments One of the Group's three business lines
PD Probability of default
PLC Public Limited Company
PPE Property, plant and equipment
PRA Prudential Regulation Authority
RAS Risk Appetite Statement
Registrar Equiniti Limited
Reorganisation Certain steps taken by the Group prior to Admission as part of a
reorganisation of its corporate structure, which resulted in all non-Group
shareholders of CTH exchanging shares in CTH for ordinary shares in CAB
Payments.
Revenue When referring to the Group's financial results means 'total income, net of
interest expense'
ROU Right-of-use asset
SBTi Science Based Targets initiative
SDG Sustainable Development Goals
SEC US Securities and Exchange Commission
SECR Streamlined Energy and Carbon Reporting
SPPI Solely Payment of Principal and Interest principle under IFRS 9
Supranational An international organisation with powers or influence that transcend national
boundaries or governments
Senior Management Employees with corporate titles of Vice President, Senior Vice President,
Director or Managing Director
SVP Corporate Title: Senior Vice President
SWIFT Society for Worldwide Interbank Financial Telecommunication
Take rate A combination of the dealing profit (i.e. the spread between any buy/sell of
two FX trades undertaken), the margin added to the transaction (i.e. the fee
element agreed with the customer for the transaction), and any additional fees
charged; and the take rate is calculated as FX and cross-currency payments
income divided by FX and cross currency payments volumes
TAM Target Addressable Market
Target Market The Group's core market today, which excludes large transactions (over $50m
transaction size) as well as China, India and the above-mentioned free format
flows (including sanctioned markets)
Target Market Assessment The approval process, which has determined that the ordinary shares are: (i)
compatible with an end target market of retail investors and investors who
meet the criteria of professional clients and eligible counterparties, each as
defined in Chapter 3 of the FCA Handbook Conduct of Business Sourcebook; and
(ii) eligible for distribution through all permitted distribution channels
TCFD Task Force on Climate-related Financial Disclosures
TL Tolerance Limits
Total income When referring to the Group's financial results means 'total income, net of
interest expense'
TN Trillion
TPP Third Party Currency Provider
TSR Total Shareholder Return
UKLA United Kingdom Listing Authority
WACC Weighted average cost of capital
Working Capital A working capital facility provided by the Group previously known as Liquidity
as a Service.
VP Corporate Title: Vice President
WTT Well to tank factors reported under Scope 3 emissions representing those that
are produced indirectly by the Group
Currency abbreviations
BDT Bangladeshi Taka
DKK Danish Krone
EUR Euro
GBP British Pound Sterling
GHS Ghanaian cedi
KES Kenyan Shilling
MWK Malawian Kwacha
NGN Nigerian Naira
SDG Sudanese Pound
UGX Ugandan Shilling
XAF Central African Franc: Currency of six independent states in Central Africa:
Cameroon, Central African Republic, Chad, Republic of the Congo, Equatorial
Guinea, and Gabon
XOF West African Franc: Currency used by eight independent states in West Africa:
Benin, Burkino Faso, Cote d'Ivoire, Guinea-Bissau, Mali, Niger, Senegal, and
Togo
Disclaimer:
This announcement is not intended to, and does not, constitute or form part of
any offer or invitation to purchase, otherwise acquire, subscribe for, sell or
otherwise dispose of, any securities or the solicitation of any vote or
approval in any jurisdiction.
1. This announcement does not constitute a prospectus or a prospectus
exempted document.
2. The release, publication or distribution of this announcement in
jurisdictions other than the United Kingdom may be restricted by law and
therefore any persons who are not resident in the United Kingdom or who are
subject to the laws of any jurisdiction other than the United Kingdom should
inform themselves about, and observe, any applicable legal or regulatory
requirements. Any failure to comply with applicable legal or regulatory
requirements of any jurisdiction may constitute a violation of securities laws
in that jurisdiction.
3. This announcement may contain statements which are, or may be
deemed to be, "forward-looking statements". All statements, other than
statements of historical fact are, or may be deemed to be, forward-looking
statements. Forward-looking statements are prospective in nature and are not
based on historical facts, but rather on assumptions, expectations,
valuations, targets, estimates, forecasts and projections of CAB Payments
about future events, and are therefore subject to risks and uncertainties
which could cause actual results, performance or events to differ materially
from those expressed or implied by the forward-looking statements. Often, but
not always, forward-looking statements can be identified by the use of
forward-looking words such as "plans", "expects", "budget", "targets", "aims",
"scheduled", "estimates", "forecast", "intends", "anticipates", "seeks",
"prospects", "potential", "possible", "assume" or "believes", or variations of
such words and phrases or statements that certain actions, events or results
"may", "could", "should", "would", "might" or "will" be taken, occur or be
achieved. CAB Payments gives no assurance that such expectations will prove to
be correct. By their nature, forward-looking statements involve risks (known
and unknown) and uncertainties (and other factors that are in many cases
beyond the control of CAB Payments) because they relate to events and depend
on circumstances that may or may not occur in the future.
4. There are a number of factors that could affect the future
operations of the CAB Payments group and that could cause actual results and
developments to differ materially from those expressed or implied by such
forward-looking statements. These include factors, such as: domestic and
global business and economic conditions; the impact of pandemics, asset
prices; market-related risks such as fluctuations in interest rates and
exchange rates, industry trends, competition, changes in government and
regulation, changes in the policies and actions of governments and/or
regulatory authorities (including changes related to capital and tax), changes
in political and economic stability (including exposures to terrorist
activities, the United Kingdom's exit from the European Union, Eurozone
instability, disruption in business operations due to reorganisation
activities, interest rate, inflation, deflation and currency fluctuations),
the timing impact and other uncertainties of future or planned acquisitions or
disposals or offers. Other unknown or unpredictable factors could affect
future operations and/or cause actual results to differ materially from those
in the forward-looking statements. Such forward-looking statements should
therefore be construed in the light of such factors.
5. Each forward-looking statement speaks only as of the date of this
announcement. Neither the CAB Payments group nor any of their respective
associates or directors, officers or advisers provides any representation,
warranty, assurance or guarantee that the occurrence of the events expressed
or implied in any forward-looking statements in this announcement will
actually occur. Forward-looking statements involve inherent risks and
uncertainties. All forward-looking statements contained in this announcement
are expressly qualified in their entirety by the cautionary statements
contained or referred to in this section. Readers are cautioned not to place
undue reliance on these forward-looking statements. Other than in accordance
with their legal or regulatory obligations, CAB Payments group is neither
under nor undertakes any obligation, and expressly disclaims any intention or
obligation, to update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise.
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