Freedom Holding Corp
For the period ended Dec 31, 2024. Filed Feb 7, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Dec 31, 2024 · Filed Feb 7, 2025
FRHC$178.85+0.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-30; filed 2024-11-08.
0000924805-24-000068
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-12-31; filed 2025-02-07.
0000924805-25-000002
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 304 previous paragraphs and 314 current paragraphs.
168 unchanged; 116 reworded; 26 added; 17 removed; 3 previous and 4 current paragraphs rearranged.
Tables are not compared: 36 previous and 36 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (26)
Current report
We own and operate lifestyle-focused platforms such as the e-commerce solution, the premier online travel booking service and the go-to platform for entertainment and event management. These services, alongside our core financial businesses, provide convenience and value for our clients, making FRHC more than a financial services provider but also a lifestyle enabler.
Current report
From the very beginning, our mission has been to democratize access to international capital markets for retail and institutional clients alike. Today, we are improving the financial industry by creating an integrated digital fintech ecosystem designed to meet the evolving demands of a global customer base. Our strategy centers on providing a seamless, user-friendly experience by combining innovative technologies with a comprehensive suite of services accessible through a single, unified platform. Our ambition is to set the gold standard for digital customer experiences, leveraging advanced technologies to deliver customized solutions that make managing finances and accessing global markets simpler, faster, and more intuitive. By fostering innovation and pushing boundaries, we aim to remain at the forefront of the industry.
Current report
We had net income of $78.1 million for the three months ended December 31, 2024, as compared to $96.1 million for the three months ended December 31, 2023. Our Brokerage, Banking, Insurance, and Other segments contributed net income of $102.3 million, net income of $34.5 million and net loss of $5.2 million and net loss of $53.4 million, respectively, to our total net income for the three months ended December 31, 2024.
Current report
During the three months ended December 31, 2023, we had a realized gain on trading securities of $9.4 million, which is mainly attributable to debt securities of the Kazakhstan Sustainability Fund JSCsold during the three months ended December 31, 2023. We had an unrealized net loss in amount of $14.4 million in the three months ended December 31, 2023 due to securities positions we continued to hold at December 31, 2023. The majority of the unrealized net loss arose from the securities of Kazakhstan Sustainability Fund JSC, primarily as a consequence of price declines.
Current report
Additionally, the interest income on securities available-for-sale increased by $3.5 million, or 47%, compared to the three months ended December 31, 2023. Such increase was due to the increase of volume of available-for-sale securities which is attributable to the purchase of debt securities of the Ministry of Finance of the Republic of Kazakhstan.
Current report
For the three months ended December 31, 2024, we realized a net gain on foreign exchange operations of $3.9 million compared to a net gain of $38.8 million for the three months ended December 31, 2023. The net gain for the three months ended December 31, 2024, is primarily attributable to a $23.2 million gain from foreign currency transactions, partially offset by a $19.2 million translation loss. The decrease compared to the prior-year period was mainly driven by a 9.1% depreciation of the Kazakhstan tenge against the U.S. dollar, which led to increased foreign exchange currency losses for our subsidiaries operating in Kazakhstan.
Current report
During the three months ended December 31, 2024, total interest expense remained relatively flat compared to the same period in 2023. However, its composition changed due to shifts in funding sources and interest rate dynamics.
Current report
There was a decrease in interest expense on securities repurchase agreement obligations, driven by a 15% decline in the average balance, from $2.9 billion during the three months ended December 31, 2023 to $2.4 billion during the three months ended December 31, 2024. Additionally, the average interest rate applied to these obligations decreased from 16% to 15%, further contributing to the reduction in costs. This decline reflects adjustments in our short-term funding strategy and a shift towards more stable, long-term financing sources.
Current report
At the same time, interest expense related to customer liabilities increased as the average balance of customer deposits and brokerage account liabilities grew 43% year-over-year, rising from $1.1 billion to $1.6 billion. This increase was caused by a higher average interest rate, which rose from 6% to 7%, reflecting both market-driven adjustments and an expanded customer deposit base.
Current report
Additionally, interest expense on debt securities issued increased, primarily due to a rise in the average balance, from $131.3 million to $423.6 million. The average interest rate on these instruments also increased, from 5% to 10%, reflecting a shift toward long-term financing at higher prevailing market rates. This increase in debt issuance aligns with our broader funding strategy to support business expansion and strengthen liquidity reserves.
Current report
General and administrative expense for the three months ended December 31, 2024, was $73.4 million, representing an increase of 41.3 million or 129% compared to general and administrative expense of $32.1 million for the three months ended December 31, 2023. The main factors contributing to the increase was in charity and sponsorship. Our charity and sponsorship expense increased by $31.4 million due to several charitable contributions through our subsidiaries during the three months ended December 31, 2024. The most significant contributions were made to the Kazakhstan Chess Federation, Junior Football League of Kazakhstan, Tennis Federation of the Olympic Committee, and organization of a chess tournament in the USA. Taxes, other than income tax, increased by $2.3 million, mainly due to the general growth of the Group, including the addition of new subsidiaries.
Current report
We recognized provision for allowance for credit losses in the amount of $30.6 million for the three months ended December 31, 2024, as compared to recovery of provision for allowance for credit losses of $3.5 million for the three months ended December 31, 2023. The increase between the two periods is mostly attributable to increased provisions for uncollateralized bank customer loans and right of claim for purchased retail loans, driven by a change of estimate for forward-looking information as a result of currency depreciation occurred prior reporting date.
Current report
Comparison of the Nine-month Periods Ended December 31, 2024 and 2023
Current report
For the nine months ended December 31, 2024, we realized a net gain on foreign exchange operations of $18.5 million compared to a net gain of $54.4 million for the nine months ended December 31, 2023. The net gain for the nine months ended December 31, 2024, is primarily attributable to a $52.7 million gain from foreign currency transactions, partially offset by a $34.2 million translation loss. The decrease compared to the prior-year period was mainly driven by an 18% depreciation of the Kazakhstan tenge against the U.S. dollar, which led to increased foreign exchange currency losses for our subsidiaries operating in Kazakhstan.
Current report
During the nine months ended December 31, 2024, total interest expense remained relatively flat compared to the same period in 2023. However, its composition changed due to shifts in funding sources and interest rate dynamics.
Current report
There was a decrease in interest expense on securities repurchase agreement obligations, driven by a 2% decline in the average balance, from $2.6 billion during the nine months ended December 31, 2023 to $2.5 billion during the nine months ended December 31, 2024. Additionally, the average interest rate applied to these obligations decreased from 16% to 14%, further contributing to the reduction in costs. This decline reflects adjustments in our short-term funding strategy and a shift towards more stable, long-term financing sources.
Current report
At the same time, interest expense related to customer liabilities increased as the average balance of customer deposits and brokerage account liabilities grew 9% year-over-year, rising from $1.0 billion to $1.1 billion. This increase was caused by a higher average interest rate, which rose from 7% to 9%, reflecting both market-driven adjustments and an expanded customer deposit base.
Current report
Additionally, interest expense on debt securities issued increased, primarily due to a rise in the average balance, from $86.4 million to $318.5 million. The average interest rate on these instruments also increased, from 5% to 10%, reflecting a shift toward long-term financing at higher prevailing market rates. This increase in debt issuance expense aligns with our broader funding strategy to support business expansion and strengthen liquidity reserves.
Current report
For the nine months ended December 31, 2024, our professional services expense was $26.5 million, representing an increase by $1.7 million, or 7%, compared to $24.8 million for the nine months ended December 31, 2023. The increase was attributable to the overall growth of our company organically and through acquisitions between the two periods.
Current report
In the three months ended December 31, 2024, total expenses, net in our Other segment increased by $64.6 million, driven by anincrease of $34 million in general and administrative expense. The main factors contributing to the increase was an increase in charity and sponsorship. Our charity and sponsorship expense increased by $31.4 million due to several charitable contributions through our subsidiaries during the three months ended December 31, 2024. The most significant contributions were made to the Kazakhstan Chess Federation, Junior Football League of Kazakhstan, Tennis Federation of the Olympic Committee, and to the organization of a chess tournament in the USA. There were also an increase of $14.0 million in payroll and bonuses attributed to the overall growth of the Company, increase of $8.7 million in interest expense from the debt securities issued by Freedom SPC, and an increase of $3.8 million of professional services.
Current report
Comparison of the Nine-month Periods Ended December 31, 2024 and 2023
Current report
In the nine months ended December 31, 2024, total revenue, net in the Insurance segment increased mainly due to a significant increase in insurance underwriting income due to written insurance premiums, and $4.3 million increase in net gain on foreign exchange operations due to an appreciation of the U.S. dollar against the Kazakhstan tenge between the two periods. However, this increase was partially offset by a decrease of other income, net gain on trading securities and interest income due to changes in securities portfolio.
Current report
For the nine months ended December 31, 2024, total expenses, net increased across each of our business segments compared to the nine months ended December 31, 2023.
Current report
Set forth below is a discussion of our short-term and long-term debt.
Current report
As of December 31, 2024, there was$466.6 million of Freedom SPC bonds outstanding. The aggregate accrued interest as of December 31, 2024 was $2.2 million.
Current report
During the nine months ended December 31, 2024, Freedom Bank KZ established three Kazakhstan law bond programs: (i) a program of up to 100 billion Kazakhstani tenge, of which 7-year bonds for 50 billion Kazakhstani tenge which have been listed on the KASE, with a floating interest rate to be determined following the first trades, (ii) a program of up to 200 billion Kazakhstani tenge, of which 2-year bonds for 36 billion Kazakhstani tenge have been listed on the KASE with a fixed interest rate determined following the first trades, and (iii) a program of up to $300 million, of which 2- year bonds for $50 million have been listed on the KASE with a fixed interest rate determined following the first trades. None of the bonds within the Freedom Bank KZ's bond programs have been placed to investors. Going forward, Freedom Bank KZ may decide to place any or all of these the bonds as needed to support its liquidity.
Removed paragraphs (17)
Previous report
Our business was founded in order to provide access to the international capital markets for retail brokerage clients. Our business has grown rapidly in recent years. We are pursuing a strategy to become a leader in the financial services industry, serving individuals and institutions desiring enhanced market access to international capital markets using state of the art technology platforms for their brokerage and banking needs. We are committed to further developing our digital fintech ecosystem by integrating our core financial services businesses with our ancillary business offerings. Our strategic objective is to provide customers with a comprehensive and user-centric digital experience, offering them convenient access to a wide array of products and services through a single platform. By leveraging cutting-edge technology and fostering continuous innovation, we strive to enhance our digital offering and meet the evolving needs of our diverse customer base.
Previous report
The foregoing increases in revenues were offset in part by a decrease in our interest income to $210.3 million for the three months ended September 30, 2024, from $213.1 million for the three months ended September 30, 2023. The decrease was primarily attributable to decrease in interest income on trading securities.
Previous report
We had net income of $114.7 million for the three months ended September 30, 2024, as compared to $115.8 million for the three months ended September 30, 2023. Our Brokerage, Banking, Insurance and Other segments contributed $85.6 million, $45.7 million, $14.8 million of net income and a net loss of $31.6 million, respectively, to our total net income for the three months ended September 30, 2024.
Previous report
During the three months ended September 30,2023, we had a realized gain on trading securities of $41.1 million, which is attributable to Kazakhstan sovereign bonds sold during three months ended September 30, 2023. We had an unrealized net gain in the three months ended September 30, 2023, due to securities positions we continued to hold at September 30, 2023, having appreciated by $9.7 million. The majority of the unrealized net gain comes from the appreciated shares of KazMunayGaz and Kazakhstan sovereign bonds. During the three months ended September 30, 2023, KazMunayGas shares increased in value due to an increase in oil prices during such quarter. The sharp decline in the
Previous report
National Bank of the Republic of Kazakhstan's base interest rate was the key factor causing the appreciation of the Kazakhstan sovereign bonds during the three months ended September 30, 2023.
Previous report
For the three months ended September 30,2024, we realized a net gain on foreign exchange operations of $6.5 million compared to a net loss of $3.7 million for the three months ended September 30,2023. The net gain for the three months ended September 30, 2024 is mainly attributable to a $16.9 million gain on sale and purchases of foreign currency for the three months ended September 30, 2024, which was partially offset by a translation loss of $10.4 million for that quarter. This increase between the two quarters is not only due to there having been more trading gain transactions than loss transactions during the three months ended September 30, 2024 but also due to a 78% increase in Freedom Bank's overall transaction volume with foreign currency between the two quarters.
Previous report
During the three months ended September 30,2024, we had a $14.7 million, or 11%, decrease in interest expense as compared to the three months ended September 30,2023. The decrease in interest expense was primarily attributable to a $30.9 million, or 26%, decrease in interest expense on short-term financing through securities repurchase agreements due to a decrease in the volume of such financing. This was partially offset by 6.0 million increase in interest expense on debt securities issued and $5.8 million increase in interest expense on customer deposits. Compared to the three months ended September 30,2023, we decreased our volume of short-term financing through securities repurchase agreements primarily in order to fund our investment portfolio. The increase in interest on customer deposits was a result of growth of our banking client base due to the expansion of the operations of Freedom Bank KZ between the two periods.
Previous report
General and administrative expense for the three months ended September 30, 2024, was $53.2 million, representing an increase of $23.6 million or 80% compared to general and administrative expense of $29.6 million for the three months ended September 30, 2023. The increase is attributable to the general expansion and development of our business between the two quarters. The main factors contributing to the increase were increases in charity and sponsorship, other operating expenses, rent expenses, lease depreciation and software support. Our charity and sponsorship expense increased by $13.8 million due to several charitable contributions through our subsidiaries during the three months ended September 30, 2024. The most significant contributions were made to the Kazakhstan Chess Federation, Sport Programming Federation and construction work in Konayev city. Other operating expenses increased by $2.8 million mainly due to an increase of other operating expenses at Freedom Bank KZ from banking and other overhead costs. The increase of $1.6 million in rent expense was driven by the addition of new subsidiaries between the two quarters and the overall growth of our operations. Lease depreciation expenses increased by $1.2 million, attributable to our overall growth and the need for more office space. The expansion of our workforce and the establishment of new offices required additional leasing, leading to higher depreciation costs. Software support expenses increased by $0.9 million mainly due to the support of licensed software fee and other software systems.
Previous report
We recognized provision for allowance for credit losses in the amount of $10.4 million for the three months ended September 30, 2024, as compared to provision for allowance for credit losses of $4.7 million for the three months ended September 30, 2023. As of September 30, 2024, the allowance for credit losses was $48.7 million, compared to $43.6 million as of March 31, 2024. The increase between the two periods is attributable to provisions for uncollateralized bank customer loans. The increase in provisions is primarily attributable to the deterioration of the quality of the portfolio for the digital loans for individual entrepreneurs. The effect of the increase in provisions is partially offset by the revision of the approach to calculating reserve rates for collective loans.
Previous report
Comparison of the Six-month Periods Ended September 30, 2024 and 2023
Previous report
For the six months ended September 30, 2024 , we realized a net gain on foreign exchange operations of $14.6 million compared to a net gain of $15.6 million for the six months ended September 30, 2023. The increase in net gain can be attributed to a gain of $29.6 million on purchases and sale of foreign currency that was partially offset by a translation loss of $15.0 million, mainly due to the 95% increase of Freedom Bank's volume of currency transactions compared to the six months ended September 30, 2023.
Previous report
During the six months ended September 30, 2024, we had a $36.0 million, or 15%, increase in interest expense as compared to the six months ended September 30, 2023. The increase in interest expense was primarily attributable to a $24.1 million, or 373%, increase in interest expense on margin lending payable due to an increase in the volume of such financing, and a $13.4 million, or 40%, increase in interest expense on customer deposits. Compared to the six months ended September 30, 2023. The increase in interest on customer deposits was a result of growth of our banking client base due to the expansion of the operations of Freedom Bank KZ between the two periods.
Previous report
For the six months ended September 30, 2024, our professional services expense was $15.5 million, representing a decrease by $3.1 million or 16% compared to $18.6 million for the six months ended September 30, 2023. The decrease was primarily attributable to a decrease in expenses for auditing services rendered by our external auditors due to timing differences in the provision of such services. The decrease was partially offset by increases in certain professional services expenses, including consulting and legal fees, attributable to the overall growth of our company organically and through acquisitions between the two periods.
Previous report
In the three months ended September 30, 2024, total expenses, net in our Other segment increase was driven by increases of $16.2 million in general and administrative expense, mainly due to the charity and sponsorship expense by Freedom Shapagat, a non-profit corporate fund. There was also an increase of $9.1 million in payroll and bonuses, due to the overall growth of the company. There was also an increase of $6.3 million in interest expense from Freedom SPC debt securities issued. We have also seen an increase of $3.7 million in fee and commission expense mainly from Paybox and its payment processing activity. There was also an increase of $2.8 million, mostly from the activity of Freedom Advertising and FRHC. The overall increase was offset by a $4.2 million decrease in professional services.
Previous report
Comparison of the Six-month Periods Ended September 30, 2024 and 2023
Previous report
For the six months ended September 30, 2024, total expenses, net increased across each of our business segments compared to the six months ended September 30, 2023.
Previous report
The aggregate accrued interest as of September 30, 2024 on the Freedom SPC bonds due 2026 and the Freedom SPC bonds due 2028 combined was $2.3 million.
Reworded paragraphs (116)
Previous wording
All statements other than statements of historical fact included herein and in the documents incorporated by reference in this quarterly report on Form 10-Q, if any, including without limitation, statements regarding our future financial position, business strategy, potential acquisitions or divestitures, budgets, projected costs, and plans and objectives of management for future operations, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, forward-looking statements can be identified by terminology such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “forecast,” “future,” “intend,” “likely,” “may,” “might,” “plan,” “potential,” “predict,” “project,” “should,” “strategy,” “will,” “ would,” and other similar expressions and their negatives.
Current wording
All statements other than statements of historical fact included herein, any documents incorporated herein by reference, or any related discussions in this quarterly report on Form 10-Q, if any, including without limitation, statements regarding business strategy, credit rating, impact of new accounting pronouncements, expected capital expenditures and plans to finance such capital expenditure in the telecommunications business, treasury policy, expected outcome of litigation, aims, goals, and plans and objectives, and other than non-historical statements are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, forward-looking statements can be identified by terminology such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “forecast,” “future,” “intend,” “likely,” “may,” “might,” “plan,” “potential,” “predict,” “project,” “should,” “strategy,” “will,” “ would,” and other similar expressions and their negatives.
Previous wording
Forward-looking statements are not guarantees of future performance and involve known and unknown risks and uncertainties, many of which may be beyond our control. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof, and actual results could differ materially as a result of various factors. The following include some but not all of the factors that could cause actual results or events to differ materially from anticipated results or events:
Current wording
Forward-looking statements are not guarantees of future performance and involve known and unknown risks and uncertainties, many of which may be beyond our control, which could cause actual results to differ materially from the those implied by the forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof, and actual results could differ materially as a result of various factors. The following include some but not all of the factors that could cause actual results or events to differ materially from anticipated results or events:
Previous wording
You should not place undue reliance on forward-looking statements. Forward-looking statements are based on the beliefs of management as well as assumptions made by and information currently available to management and apply only as of the date of this quarterly report or the respective dates of the documents from which they incorporate by reference. Neither we nor any other person assumes any responsibility for the accuracy or completeness of forward-looking statements. Further, except to the extent required by law, we undertake no obligations to update or revise any forward-looking statements, whether as a result of new information, future events, a change in events, conditions, circumstances or assumptions underlying such statements, or otherwise. We may also make additional forward-looking statements from time to time. All such subsequent forward-looking statements, whether written or oral, made by us or on our behalf, are also expressly qualified by these cautionary statements.
Current wording
You should not place undue reliance on forward-looking statements. Forward-looking statements are based on the beliefs of management as well as assumptions made by and information currently available to management and apply only as of the date of this quarterly report or the respective dates of the documents from which they incorporate by reference. Neither we nor any other person assumes any responsibility for the accuracy or completeness of forward-looking statements. Further, except to the extent required by law, we undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, a change in events, conditions, circumstances or assumptions underlying such statements, or otherwise. We may also make additional forward-looking statements from time to time. All such subsequent forward-looking statements, whether written or oral, made by us or on our behalf, are also expressly qualified by these cautionary statements.
Previous wording
Freedom Holding Corp. ("FRHC") is organized under the laws of the State of Nevada and acts as a holding company for all of our operating subsidiaries. Our subsidiaries engage in a broad range of activities including securities brokerage, securities dealing for customers and for our own account, market making activities, investment research, investment counseling, investment banking services, retail and commercial banking, insurance products, payment services, and information processing services. We also own several ancillary businesses which complement our core financial services businesses, including telecommunications and media businesses in Kazakhstan that are in a developmental stage.
Current wording
Freedom Holding Corp. ("FRHC"), incorporated under the laws of the State of Nevada, combines cutting-edge financial services with an array of lifestyle solutions. Through our subsidiaries, we provide a diverse range of offerings, including securities brokerage, market making, investment research, financial advisory, investment banking, retail and commercial banking, insurance products, payment solutions, and data processing services. We also own several ancillary businesses intended to complement our core financial services businesses, including telecommunications and media businesses in Kazakhstan that are in a developmental stage.
Previous wording
The main market of our operations is Kazakhstan. Our operating subsidiaries are located in Kazakhstan, Cyprus, the United States, the United Kingdom, Armenia, the United Arab Emirates, Uzbekistan, Kyrgyzstan, Tajikistan, Azerbaijan, and Turkey and we also have a presence in Austria, Belgium, Bulgaria, France, Germany, Greece, Italy, Lithuania, The Netherlands, Poland and Spain. We divested our Russian subsidiaries in February 2023. Our subsidiaries in the United States include an SEC- and FINRA-registered broker dealer. As of September 30, 2024, we had 7,146 employees and 189 offices (of which 42 offered brokerage services, 56 offered insurance services, 26 offered banking services and 65 offered other financial and non-financial services).
Current wording
The main market of our operations is Kazakhstan. Our operating subsidiaries are located in Kazakhstan, Cyprus, the United States, the United Kingdom, Armenia, the United Arab Emirates, Uzbekistan, Kyrgyzstan, Tajikistan, Azerbaijan, and Turkey, and we also have a presence in Austria, Belgium, Bulgaria, France, Germany, Greece, Italy, Lithuania, The Netherlands, Poland and Spain. We divested our Russian subsidiaries in February 2023. Our subsidiaries in the United States include an SEC- and FINRA-registered broker dealer. As of December 31, 2024, we had 7,761 employees and 204 offices (of which 51 offered brokerage services, 56 offered insurance services, 29 offered banking services and 68 offered other financial and non-financial services).
Previous wording
Our Brokerage segment primarily focuses on retail brokerage and investment banking. Our Banking segment encompasses lending, deposit services, payment card services, money transfers, and correspondent accounts, supporting both individual and corporate clients with innovative digital financial solutions. Our Insurance segment offers life and general insurance services. Our Other segment includes payment processing services, online ticket sales, and new business areas including telecommunications and media services. We also engage in proprietary securities trading activities through each of our four segments.
Current wording
Our Brokerage segment primarily focuses on retail brokerage and investment banking. Our Banking segment encompasses lending, deposit services, payment card services, money transfers, and correspondent accounts, supporting both individual and corporate clients with innovative digital financial solutions. Our Insurance segment offers life and general insurance services. Our Other segment includes payment processing services, e-commerce, online ticket sales, and new business areas including telecommunications and media services. We also engage in proprietary securities trading activities through each of our four segments.
Previous wording
As of September 30, 2024, in our Brokerage business segment we had 42 offices that provided brokerage and financial services, investment consulting and education, including offices in Kazakhstan, Cyprus, Armenia, United States, Uzbekistan and Kyrgyzstan and representative offices in a number of other European countries. We provide a comprehensive range of securities brokerage services to individuals, businesses and financial institutions. Depending on the region, our brokerage services may include securities trading and margin lending. Our investment banking business consists of investment banking professionals in Kazakhstan, Uzbekistan and the United States who provide strategic advisory services and capital markets products.
Current wording
As of December 31, 2024, in our Brokerage business segment we had 51 offices that provided brokerage and financial services, investment consulting and education, including offices in Kazakhstan, Cyprus, Armenia, United States, Uzbekistan, and Kyrgyzstan and representative offices in a number of other European countries. In addition, following receipt of a principal approval by the Turkey's financial regulatory and supervisory authority granted on January 9, 2025, we are in the process of obtaining a license to provide brokerage services in Turkey. We provide a comprehensive range of securities brokerage services to individuals, businesses and financial institutions. Depending on the region, our brokerage services may include securities trading and margin lending. Our investment banking business consists of investment banking professionals in Kazakhstan, Uzbekistan, and the United States who provide strategic advisory services and capital markets products.
Previous wording
Freedom EU oversees our European region operations (including Austria, Belgium, Bulgaria, Cyprus, France, Germany, Greece, Italy, Netherlands, Poland, Lithuania, Spain and the United Kingdom). In Cyprus, it is licensed to receive, transmit and execute customer orders, establish custodial accounts, engage in foreign currency exchange services and margin lending, and trade our own investment portfolio. Freedom EU serves as a hub for the Group's brokerage operations, providing transaction processing and intermediary services to our regional customers and to institutional customers that may seek access to the securities markets in the United States and Europe.
Current wording
Freedom EU oversees our European region operations (including Austria, Belgium, Bulgaria, Cyprus, France, Germany, Greece, Italy, the Netherlands, Poland, Lithuania, Spain, and the United Kingdom). In Cyprus, it is licensed to receive, transmit and execute customer orders, establish custodial accounts, engage in foreign currency exchange services and margin lending, and trade our own investment portfolio. Freedom EU serves as a hub for the Group's brokerage operations, providing transaction processing and intermediary services to our regional customers and to institutional customers that may seek access to the securities markets in the United States and Europe.
Previous wording
PrimeEx is a New York corporation that is a registered agency-only execution broker-dealer on the floor of the New York Stock Exchange ("NYSE"). PrimeEx is a member of the NYSE, Nasdaq, FINRA and the Securities Investor Protection Corp ("SIPC"). PrimeEx conducts investment banking and equity capital markets business under the name Freedom Capital Markets ("FCM").
Current wording
PrimeEx is a registered agency-only execution broker-dealer on the floor of the New York Stock Exchange ("NYSE"). PrimeEx is a member of the NYSE, Nasdaq, FINRA and the Securities Investor Protection Corp ("SIPC"). PrimeEx conducts investment banking and equity capital markets business under the name Freedom Capital Markets ("FCM").
Previous wording
As of September 30, 2024, we had 1,658 employees in our Brokerage segment, including 1,378 full-time employees and 280 part-time employees.
Current wording
As of December 31, 2024, we had 1,749 employees in our Brokerage segment, including 1,478 full-time employees and 271 part-time employees.
Previous wording
Our Banking segment consists of the operations of Freedom Bank KZ, which is a pioneer in digital retail and commercial banking services in Kazakhstan, offering a large variety of deposit, debit and credit cards allowing its customers to make purchases around the world in multiple different currencies, pay in installments or on credit, save their funds, manage their investment accounts, or get an increased cashback that is transferred to the International Fund for the Salvation of the Aral Sea. Freedom Bank KZ provides digital mortgages, digital car loans, digital business loans, and payment acquiring services for individual entrepreneurs. On October 15, 2024 we obtained a banking license in Tajikistan.
Current wording
Our Banking segment consists of the operations of Freedom Bank KZ, which is a pioneer in digital retail and commercial banking services in Kazakhstan, offering a large variety of deposit, debit and credit cards allowing its customers to make purchases around the world in multiple different currencies, pay in installments or on credit, save their funds, manage their investment accounts, or get an increased cashback that may be transferred to the International Fund for the Salvation of the Aral Sea. Freedom Bank KZ provides digital mortgages, digital car loans, digital business loans, and payment acquiring services for individual entrepreneurs. On October 15, 2024, we obtained a banking license in Tajikistan.
Previous wording
As of September 30, 2024, Freedom Bank KZ's assets increased by 1%, its loan portfolio decreased by 1%, its deposit portfolio increased by 12% and its trading portfolio decreased by 2%, in each case in comparison with March 31, 2024. During the three months ended September 30, 2024, the banking segment continued to exhibit growth. In particular, interest income increased in comparison to the three months ended September 30, 2023.
Current wording
As of December 31, 2024, Freedom Bank KZ's assets decreased by 2%, its loan portfolio increased by 5%, its deposit portfolio increased by 27%, its trading portfolio decreased by 9%, in each case in comparison with March 31, 2024. The increase in the loan and deposit portfolios reflects continued customer demand and growth in our banking services, while the decline in trading portfolio aligns with our strategic focus on core banking operations. During the three months ended December 31, 2024, the banking segment continued to exhibit growth. In particular, net gain on trading securities increased in comparison to the three months ended December 31, 2023, reflecting favorable market conditions and improved trading strategies.
Previous wording
We have 26 office locations in Kazakhstan that provide banking services to our customers. As of September 30, 2024, we had 2,571 employees in our Banking segment, all of which were full-time employees.
Current wording
We have 29 office locations in Kazakhstan and Tajikistan that provide banking services to our customers. As of December 31, 2024, we had 2,825 employees in our Banking segment, all of which were full-time employees.
Previous wording
Freedom Life provides a range of health and life insurance products to individuals and businesses, including life insurance, health insurance, annuity insurance, accident insurance, obligatory worker emergency insurance, travel insurance and reinsurance. As of September 30, 2024, Freedom Life had 1,072,794 active contracts, as compared to 616,301 active contracts as of March 31, 2024. As of September 30, 2024, Freedom Life had total assets of approximately $407.5 million and total liabilities of approximately $311.5 million, as compared to total assets of approximately $371.5 million and total liabilities of approximately $290.0 million as of March 31, 2024.
Current wording
Freedom Life provides a range of health and life insurance products to individuals and businesses, including life insurance, health insurance, annuity insurance, accident insurance, obligatory worker emergency insurance, travel insurance and reinsurance. As of December 31, 2024, Freedom Life had 973,827 active contracts, as compared to 616,301 active contracts as of March 31, 2024. As of December 31, 2024, Freedom Life had total assets of approximately $510.1 million and total liabilities of approximately $417.4 million, as compared to total assets of approximately $371.5 million and total liabilities of approximately $290.0 million as of March 31, 2024.
Previous wording
Freedom Insurance operates in the "general insurance" industry and is the leader in online insurance in Kazakhstan and offers various general insurance products in property (including automobile), casualty, civil liability, personal insurance and reinsurance. As of September 30, 2024, Freedom Insurance had 408,807 active contracts, as compared to 190,872 active contracts as of March 31, 2024. As of September 30, 2024, Freedom Insurance had total assets of approximately $157.0 million and total liabilities of approximately $93.7 million, as compared to total assets of approximately $158.0 million and total liabilities of approximately $112.8 million as of March 31, 2024.
Current wording
Freedom Insurance operates in the "general insurance" industry and is the leader in online insurance in Kazakhstan and offers various general insurance products in property (including automobile), casualty, civil liability, personal insurance and reinsurance. As of December 31, 2024, Freedom Insurance had 567,931 active contracts, as compared to 190,872 active contracts as of March 31, 2024. As of December 31, 2024, Freedom Insurance had total assets of approximately $154.3 million and total liabilities of approximately $95.3 million, as compared to total assets of approximately $158.0 million and total liabilities of approximately $112.8 million as of March 31, 2024.
Previous wording
As of September 30, 2024, we had 56 offices and 959 employees, including 924 full-time employees and 35 part-time employees, providing consumer life and general insurance services in Kazakhstan.
Current wording
As of December 31, 2024, we had 56 offices and 994 employees, including 955 full-time employees and 39 part-time employees, providing consumer life and general insurance services in Kazakhstan.
Previous wording
As of September 30, 2024, in our Other segment we had 65 offices and 2,396 employees, including 2,273 full-time employees and 123 part-time employees, providing a range of services including payment processing, entertainment ticketing sales, online air and railway ticket purchase aggregation and an online retail trade and e-commerce services. In addition, we have recently established subsidiaries in Kazakhstan to operate a telecommunications business and a media business, respectively, each of which is in the developmental stage. The revenue of this segment is currently mainly derived from provision of payment processing services, retail online ticket sales and online aggregation of purchasing air and railway tickets.
Current wording
As of December 31, 2024, in our Other segment we had 68 offices and 2,679 employees, including 2,503 full-time employees and 134 part-time employees, providing a range of services including payment processing, entertainment ticketing sales, online air and railway ticket purchase aggregation and an online retail trade and e-commerce services. In addition, we have recently established subsidiaries in Kazakhstan to operate a telecommunications business and a media business, each of which is in the developmental stage. The revenue of this segment is currently mainly derived from provision of payment processing services, retail online ticket sales and online aggregation of purchasing air and railway tickets.
Previous wording
Operating under the "Freedom" brand, our comprehensive suite of digital products and services enables our customers to engage in electronic trading and to monitor their accounts. Our flagship online trading platform Tradernet is designed for a wide range of investors featuring a comprehensive and user-friendly interface and secure infrastructure. The platform allows users to trade a diverse array of financial instruments, including stocks, options, and ETFs from major global exchanges such as KASE, AIX, NYSE, Nasdaq, ATHEX, the London Stock Exchange, the Chicago Mercantile Exchange, the Hong Kong Stock Exchange and Deutsche Börse.
Current wording
Operating under the "Freedom" brand, our comprehensive suite of digital products and services enables our customers to engage in electronic trading and to monitor their accounts. Our flagship online trading platform Tradernet is designed for a wide range of investors featuring a comprehensive and user-friendly interface and secure infrastructure. The platform allows users to trade a diverse array of financial instruments, including stocks, options, and ETFs from major global exchanges such as the KASE, AIX, NYSE, Nasdaq, ATHEX, the London Stock Exchange, the Chicago Mercantile Exchange, the Hong Kong Stock Exchange and Deutsche Börse.
Previous wording
In addition to trading capabilities, we have expanded our digital solutions to include mortgages, auto loans, and insurance products. We also operate Ticketon Events LLP ("Ticketon"), the largest online ticket sales company in Kazakhstan and Paybox platform, the digital payment aggregator which enables our customers to accept payments from buyers using a wide range of payment methods, including bank cards, online banking, electronic money, and more.
Current wording
In addition to trading capabilities, we have expanded our digital solutions to include mortgages, auto loans, and insurance products. We also operate Ticketon Events LLP ("Ticketon"), the largest online ticket sales company in
Previous wording
In April 2024, Freedom Bank KZ launched its mobile application, SuperApp, marking a significant milestone in the Kazakhstan financial technology sector. This innovative app consolidates all essential financial services into one platform, offering clients a seamless and convenient way to manage their finances. With SuperApp, clients can easily check their account balances, review transaction histories, make transfers and payments, open and manage deposits, and obtain and repay loans. The app also provides real-time portfolio monitoring, along with access to analytical reports and recommendations, empowering users to make well-informed investment decisions. SuperApp's payment services enable users to pay utility and internet bills, mobile phone charges, and other expenses effortlessly. SuperApp not only enhances the user experience but also aligns with our strategic goals. Customer satisfaction is improved through easy access to all banking and investment services in a single app, coupled with an intuitive interface and personalized recommendations.
Current wording
In April 2024, Freedom Bank KZ launched its mobile application, SuperApp, marking a significant milestone in the Kazakhstan financial technology sector. This innovative app consolidates all essential financial services into one platform, offering clients a seamless and convenient way to manage their finances. With SuperApp, clients can easily check their account balances, review transaction histories, make transfers and payments, open and manage deposits, obtain and repay loans, get access to investment, insurance, lifestyle and other products and services. The app also provides real-time portfolio monitoring, along with access to analytical reports and recommendations, empowering users to make well-informed investment decisions. SuperApp's payment services enable users to pay utility and internet bills, mobile phone charges, and other expenses effortlessly. SuperApp not only enhances the user experience but also aligns with our strategic goals. Customer satisfaction is improved through easy access to all banking and investment services in a single app, coupled with an intuitive interface and personalized recommendations.
Previous wording
In alignment with our digital fintech ecosystem strategy, we are expanding our business by entering the telecommunications market in Kazakhstan and regional media industry in Central Asia. We are seeking to establish a new independent telecommunications operator in Kazakhstan to provide a diverse range of telecommunications and telecommunications-related services to customers which may include, among others, high-quality internet connectivity, mobile virtual network operator (MVNO) services, WiFi access, over-the-top (OTT) streaming, internet protocol television (IPTV), traffic transit for operators and cloud solutions, subject to obtaining applicable licenses, acquisitions of telecom assets or entering into partnerships where required. Our new telecommunications business is operated by Freedom Telecom, a wholly-owned subsidiary of Freedom Holding Corp. incorporated under the laws of the AIFC. Pursuing further development of our telecom business, on September 17, 2024 we completed the acquisition of a 100% interest in SilkNetCom LLP for a purchase price of approximately $23.9 million. SilkNetCom LLP is a company specializing in provider services, IT and construction of telecommunications networks in private and public sectors. See Note 22 Acquisitions of subsidiaries to the condensed consolidated financial statements included in this quarterly report on Form 10-Q. Our strategy and budget for Freedom Telecom are currently being reassessed and are subject to revisions, which may be material. During fiscal 2024, we established Freedom Media LLP ("Freedom Media") as a subsidiary of Freedom Telecom that is intended to become a national media platform in Kazakhstan offering tailored streaming services to the Kazakhstan and broader Central Asia markets. This platform is expected to provide unlimited access to a diverse collection of TV shows, movies, documentaries, and exclusive content across multiple genres.
Current wording
In alignment with our digital fintech ecosystem strategy, we are expanding our business by entering the telecommunications market in Kazakhstan and regional media industry in Central Asia. We are seeking to establish a new independent telecommunications operator in Kazakhstan to provide a diverse range of telecommunications and telecommunications-related services to customers which may include, among others, high-quality internet connectivity, mobile virtual network operator (MVNO) services, WiFi access, over-the-top (OTT) streaming, internet protocol television (IPTV), traffic transit for operators and cloud solutions, subject to obtaining applicable licenses, acquisitions of telecom assets or entering into partnerships where required. Our new telecommunications business is operated by Freedom Telecom, a wholly-owned subsidiary of Freedom Holding Corp. incorporated under the laws of the AIFC. Pursuing further development of our telecom business, on September 17, 2024 we completed the acquisition of a 100% interest in SilkNetCom LLP for a purchase price of approximately$23.9 million and on October 17, 2024 we completed the acquisition of a 100% interest in EliteCom LLP for a purchase price of approximately$3.0 million.SilkNetCom LLP is a company specializing in provider services, IT and construction of telecommunications networks in private and public sectors. EliteCom LLP specializes in telecommunications services, including Internet access, telephone services and cable television for individuals (B2C), provision of Internet access services for legal entities (B2B). See Note 22"Acquisitions of subsidiaries" to the condensed consolidated financial statements included in this quarterly report on Form 10-Q. Our strategy and budget for Freedom Telecom are currently being reassessed and are subject to revisions, which may be material. During fiscal 2024, we established Freedom Media LLP ("Freedom Media") as a subsidiary of Freedom Telecom that is intended to become a national media platform in Kazakhstan offering tailored streaming services to the Kazakhstan and broader Central Asia markets. This platform is expected to provide unlimited access to a diverse collection of TV shows, movies, documentaries, and exclusive content across multiple genres.
Previous wording
On June 28, 2024, S&P Global Ratings affirmed the long-term credit rating of Freedom Holding Corp. at the "B-" level and long-term and short-term credit ratings of Freedom KZ, Freedom EU, Freedom Global and Freedom Bank KZ at the "B/B" level. The ratings of Freedom KZ and Freedom Bank KZ on the national scale were increased from "kzBB+" to "kzBBВ-", and S&P Global Ratings revised the outlook on Freedom Holding Corp. from negative to stable and the outlook on its core subsidiaries from negative to positive. The positive outlooks on the Freedom Holding Corp.'s subsidiaries reflect S&P's view that easing financial system risk in Kazakhstan and a further strengthening of the Group's risk management and capitalization could support its franchise over the next 12 months. The stable outlook on Freedom Holding Corp. reflects S&P's expectation that an upgrade on the holding company is unlikely even if it views the Group's creditworthiness overall as having strengthened.
Current wording
On December 12, 2024, S&P Global Ratings affirmed the long-term credit rating of Freedom Holding Corp. at the "B-" level and upgraded the long-term credit ratings of Freedom KZ, Freedom EU, Freedom Global and Freedom Bank KZ from "B" to "B+" level. The short-term credit ratings of Freedom KZ, Freedom EU, Freedom Global and Freedom Bank KZ have been affirmed at "B" level. The ratings of Freedom KZ and Freedom Bank KZ on the national scale were increased from "kzBBВ-" to "kzBBВ". The stable outlooks on Freedom Holding Corp. and its core operating subsidiaries Freedom KZ, Freedom EU, Freedom Global and Freedom Bank KZ reflect S&P's expectations of stable business and financial profiles over the next 12 months, benefiting from reduced economic and industry risks and enhanced regulatory oversight in Kazakhstan. S&P also factor in the group's ongoing measures to strengthen its risk management and compliance, and planned moderation of growth rates, which should support capitalization.
Previous wording
On July 2, 2024, S&P Global Ratings revised its ratings outlook on Freedom Life to stable from negative. At the same time, S&P Global Ratings affirmed their 'BB' long-term issuer credit and financial strength ratings on Freedom Life. S&P Global Ratings also raised the Kazakhstan national scale rating on Freedom Life to 'kzAA-' from 'kzA+'. S&P Global Ratings consider that Freedom Life remains a strategically important subsidiary of the Group. This is based on Freedom Life's increasing importance to the Group's operations and track record of collaboration with other Group members. S&P Global Ratings continue to view Freedom Life as an insulated entity due to strong regulatory oversight and its operational independence from the parent.
Current wording
On July 2, 2024, S&P Global Ratings revised its ratings outlook on Freedom Life to stable from negative. At the same time, S&P Global Ratings affirmed their 'BB' long-term issuer credit and financial strength ratings on Freedom Life. S&P Global Ratings also raised the Kazakhstan national scale rating on Freedom Life to 'kzAA-' from 'kzA+'. S&P Global Ratings consider that Freedom Life remains a strategically important subsidiary of the Group. This is based on Freedom Life's increasing importance to the Group's operations and track record of collaboration with other Group members. S&P
Previous wording
We had total revenues, net of $580.9 million for the three months ended September 30, 2024, as compared to $435.6 million for the three months ended September 30, 2023. The increase between the two quarters was primarily attributable to the following:
Current wording
We had total revenues, net of $655.2 million for the three months ended December 31, 2024, as compared to $418.6 million for the three months ended December 31, 2023. The increase between the two quarters was primarily attributable to the following:
Previous wording
•Our insurance underwriting income for the three months ended September 30, 2024 was $160.3 million, an increase of $102.4 million or 177%, compared to the three months ended September 30, 2023. The increase was driven by the expansion of our insurance operations such as in the pension annuity and accident insurance between the two quarters.
Current wording
•Our insurance underwriting income for the three months ended December 31, 2024 was $177.5 million, an increase of $98.5 million or 125%, compared to the three months ended December 31, 2023. The increase was driven by the expansion of our insurance operations such as in the pension annuity and accident insurance between the two quarters.
Previous wording
•We had a net gain on trading securities of $68.3 million for the three months ended September 30, 2024, as compared to a net gain on trading securities of $50.8 million for the three months ended September 30, 2023. The majority of the net gain for the three months ended September 30, 2024 was attributable to the increase in the market prices of Kazakhstan sovereign bonds held in our proprietary portfolio during the quarter.
Current wording
•We had a net gain on trading securities of $89.6 million for the three months ended December 31, 2024, as compared to a net loss on trading securities of $5.1 million for the three months ended December 31, 2023. The majority of the net gain for the three months ended December 31, 2024 was attributable to the increase in the market prices of Kazakhstan sovereign bonds held in our proprietary portfolio during the quarter.
Previous wording
•Our fee and commission income for the three months ended September 30, 2024 was $121.1 million, an increase of $9.3 million, or 8%, compared to the three months ended September 30, 2023. The increase was mainly attributable to an increase in fee and commission income from brokerage services, which increase was offset in part by decreases in fee and commission income from bank services, payment processing, underwriting and market-making services and other fee and commission income.
Current wording
•Our fee and commission income for the three months ended December 31, 2024 was $143.4 million, an increase of $23.3 million, or 19%, compared to the three months ended December 31, 2023. The increase was mainly attributable to an increase in fee and commission income from brokerage services and banking services.
Previous wording
•We had a net gain on derivatives for the three months ended September 30, 2024 in the amount of $6.3 million, an increase of $4.9 million, or 358%, compared to the three months ended September 30, 2023. The gain for the three months ended June 30, 2024 was due to revaluation of currency swaps.
Current wording
•We had a net gain on derivatives for the three months ended December 31, 2024 in the amount of $11.9 million, an increase of $54.5 million, or 128%, compared to the three months ended December 31, 2023. The gain for the three months ended June 30, 2024 was due to revaluation of currency swaps.
Previous wording
We had total expense of $452.4 million, for the three months ended September 30,2024, as compared to $300.9 million for the three months ended September 30,2023. The increase was mainly attributable to increases in fee and commission expense, insurance claims incurred (net of reinsurance), payroll and bonuses, general and administrative expense and advertising expense.
Current wording
We had total expense of $556.9 million, for the three months ended December 31, 2024, as compared to $307.0 million for the three months ended December 31, 2023. The increase was mainly attributable to increases in fee and commission expense, insurance claims incurred (net of reinsurance), payroll and bonuses, general and administrative expense, advertising expense and stock based compensation expense.
Previous wording
Our total assets increased to $8.8 billion as of September 30, 2024 from $8.3 billion as of March 31, 2024.
Current wording
Our total assets increased to $9.1 billion as of December 31, 2024 from $8.3 billion as of March 31, 2024.
Previous wording
We had approximately 555,000 total retail brokerage customers as of September 30, 2024 as compared to approximately 530,000 as of March 31, 2024. We had approximately 1,202,000 banking customers at our Freedom Bank KZ subsidiary as of September 30, 2024 as compared to approximately 904,000 as of March 31, 2024.
Current wording
We had approximately 618,000 total retail brokerage customers as of December 31, 2024 as compared to approximately 530,000 as of March 31, 2024. We had approximately 1,407,000 banking customers at our Freedom Bank KZ subsidiary as of December 31, 2024 as compared to approximately 904,000 as of March 31, 2024.
Previous wording
For the three months ended September 30,2024, total fee and commission income was $121.1 million, an increase of $9.3 million, or 8%, as compared to fee and commission income of $111.7 million for the three months ended September 30, 2023.
Current wording
For the three months ended December 31, 2024, total fee and commission income was $143.4 million, an increase of $23.3 million, or 19%, as compared to fee and commission income of $120.2 million for the three months ended December 31, 2023.
Previous wording
Fee and commission income from brokerage services for the three months ended September 30, 2024 was $107.4 million, representing a 27% increase as compared to $84.7 million for the three months ended September 30, 2023. This increase was primarily due to an increase in the number of retail brokerage customers from 434,000 as of September 30, 2023 to 555,000 as of September 30, 2024. The increase in the number of customers was attributable in part to the migration of customers from our affiliate FST Belize to brokerage companies within our Group between the two quarters. The increase was offset in part by a decrease in fee and commission income from brokerage services generated from FST Belize between the two quarters, as our omnibus brokerage account arrangement with FST Belize was wound down and customers of FST Belize closed their accounts at FST Belize and opened accounts with brokerage companies within our Group. During the three months ended September 30, 2024, we earned fee and commission income from a market maker customer at our Freedom Global subsidiary in an amount of $71.4 million, representing 59% of our total fee and commission income for that quarter.
Current wording
Fee and commission income from brokerage services for the three months ended December 31, 2024 was $118.8 million, representing a 19% increase as compared to $99.8 million for the three months ended December 31, 2023. This increase was primarily due to an increase in the number of retail brokerage customers from 458,000 as of December 31, 2023 to 618,000 as of December 31, 2024. The increase in the number of customers was attributable in part to the migration of customers from our affiliate FST Belize to brokerage companies within our Group between the two quarters. The increase was offset in part by a decrease in fee and commission income from brokerage services generated from FST Belize between the two quarters, as our omnibus brokerage account arrangement with FST Belize was wound down and customers of FST Belize closed their accounts at FST Belize and opened accounts with brokerage companies within our Group. During the three months ended December 31, 2024, we earned fee and commission income from a market maker customer at our Freedom Global subsidiary in an amount of $77.4 million, representing 54% of our total fee and commission income for that quarter.
Previous wording
Fee and commission income from payment processing decreased to $6.0 million for the three months ended September 30, 2024 from $10.3 million for the three months ended September 30, 2023. The $4.3 million decrease is attributable to a decrease in transaction volumes between the two quarters, which was in turn due to the cessation of operations of one of our counterparties, which previously contributed a substantial transaction volume.
Current wording
Fee and commission income from payment processing decreased to $7.1 million for the three months ended December 31, 2024 from $9.0 million for the three months ended December 31, 2023. The decrease is attributable to a decrease in transaction volumes between the two quarters, which was in turn due to the cessation of operations of one of our counterparties, which previously contributed a substantial transaction volume.
Previous wording
Fee and commission income from banking services decreased to $1.9 million in the three months ended September 30, 2024 from $9.3 million in the three months ended September 30, 2023, a decrease of $7.4 million or 80%. The decrease in fee and commission income from banking services was primarily due to a $5.4 million decrease in commissions generated on transfer and payment processing, which was a result of a decrease in the volume of transfer and payment processing transactions between the two quarters.
Current wording
Fee and commission income from banking services increased to $8.4 million in the three months ended December 31, 2024 from $1.3 million in the three months ended December 31, 2023. The increase in fee and commission income from banking services between the two quarters was primarily due to increase in commissions generated on transfer and payment processing, which was a result of an increase in the volume of transfer and payment processing transactions and an increase of cash operations income, by attracting new clients.
Previous wording
Fee and commission income from underwriting and market-making activities decreased by 58% to $1.2 million for the three months ended September 30, 2024 from $2.9 million for the three months ended September 30, 2023, driven by a lower volume of underwriting transactions for the three months ended September 30, 2024 as compared to the three months ended September 30, 2023.
Current wording
Fee and commission income from underwriting and market-making activities decreased by 54% to $1.5 million for the three months ended December 31, 2024 from $3.3 million for the three months ended December 30, 2023, driven by a lower volume of underwriting transactions for the three months ended December 31, 2024 as compared to the three months ended December 31, 2023.
Previous wording
We had a net gain on trading securities of $68.3 million for the three months ended September 30, 2024, an increase of $17.5 million as compared to a net gain of $50.8 million or the three months ended September 30, 2023. The following table sets forth information regarding our net gains on trading activities during the three months ended September 30,2024 and 2023:
Current wording
We had a net gain on trading securities of $89.6 million for the three months ended December 31, 2024, an increase of $94.7 million as compared to a net loss of $5.1 million for the three months ended December 31, 2023. The following table sets forth information regarding our net gains on trading activities during the three months ended December 31, 2024 and 2023:
Previous wording
During the three months ended September 30,2024, we had a realized gain on trading securities of $2.4 million, which is attributable to Kazakhstan sovereign bonds sold during the three months ended September 30,2024. Also, we recognized an unrealized net gain of $65.9 million during the same period due to an increase in the value of securities positions we held as of September 30, 2024. The majority of the unrealized net gain is attributable to Kazakhstan sovereign bonds.
Current wording
During the three months ended December 31, 2024, we had a realized gain on trading securities of $15.0 million, which is attributable to Kazakhstan sovereign bonds sold during the three months ended December 31, 2024. Also, we recognized an unrealized net gain of $74.6 million during the same period due to an increase in the value of securities positions we held as of December 31, 2024. The majority of the unrealized net gain is attributable to Kazakhstan sovereign bonds.
Previous wording
For the three months ended September 30, 2024, we had interest income of $210.3 million, representing a decrease of $2.7 million, or 1%, compared to the three months ended September 30, 2023. The decrease in interest income was primarily attributable to decrease in interest income on trading securities. Interest income on trading securities decreased by $9.0 million, or 8%, as a result of a decrease in the total size of our trading portfolio and an decrease in the amount of bonds we held as a percentage of our total trading portfolio between the two periods. Interest income on loans to customers increased by $6.5 million, or 15%, compared to the three months ending September 30, 2023 due to the growth of Freedom Bank KZ's customer loan portfolio between the two quarters. Interest income on margin loans to customers decreased by $1.7 million, or 4%, compared to the three months ended September 30, 2023, due to a decrease in the usage of margin loans for trades by our clients between the two quarters. For the three months ended September 30, 2024, we earned interest income from margin lending from a market maker customer at our Freedom Global subsidiary in an amount of approximately $7.6 million, representing 4% of our total interest income from margin lending for that quarter.
Current wording
For the three months ended December 31, 2024, we had interest income of $224.7 million, representing a decrease of $1.8 million, or 1%, compared to the three months ended December 31, 2023. The increase in interest income was primarily attributable to the increase of the income from margin loans to customers by $9.7 million, or 19% due to an increase in the usage of margin loans for trades by our clients between the two periods, partially offset by the decrease in interest income on trading securities by $17.2 million, or 15%, as a result of a decrease in the total size of our trading portfolio and a decrease in the amount of bonds we held as a percentage of our total trading portfolio between the two periods.
Previous wording
Interest income on margin loans to customers includes income accrued on off-balance sheet arrangements, the monthly average balance of which is not included in the table above. These off-balance sheet arrangements mainly included repurchase agreements of our brokerage clients. As of September 30, 2024 and 2023, the monthly average balance of off-balance sheet arrangements were $507.2 million and $788.2 million, respectively, and the weighted average interest rate was 5.7%, and 11.7%, respectively.
Current wording
Interest income on margin loans to customers includes income accrued on off-balance sheet arrangements, the monthly average balance of which is not included in the table above. These off-balance sheet arrangements mainly included repurchase agreements of our brokerage clients. As of December 31, 2024 and 2023, the monthly average balance of off-balance sheet arrangements were and $788.2 million, respectively, and the weighted average interest rate was 0.0%, and 11.7%, respectively.
Showing the first 40 of 116 pairs. Open the source sections for the rest.
Rearranged current paragraphs (4)
Current report — wording carried from elsewhere
Kazakhstan and Paybox platform, the digital payment aggregator which enables our customers to accept payments from buyers using a wide range of payment methods, including bank cards, online banking, electronic money, and more.
Current report — wording carried from elsewhere
Global Ratings continue to view Freedom Life as an insulated entity due to strong regulatory oversight and its operational independence from the parent.
Current report — wording carried from elsewhere
For the nine months ended December 31, 2024, interest income on loans to customers increased by $29.1 million, or 24%, compared to the nine months ending December 31, 2023 due to the growth of Freedom Bank KZ's customer loan portfolio between the two periods.
Current report — wording carried from elsewhere
Telecom are currently being reassessed and are subject to revisions, which may be material. We currently plan to finance our capital expenditures for this business area with a combination of own funds and borrowings, including vendor financing and utilizing the proceeds of a $200 million U.S. dollar domestic bond placement on the AIX that we completed on December 19, 2023. For further information, see "Indebtedness – Long-term" below.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
Other fee and commission income decreased by 3% to $4.6 million for the three months ended September 30, 2024 from $4.5 million for the three months ended September 30, 2023, due to a decrease in agency fees generated by our online travel ticket aggregator subsidiary.
Previous report — wording carried elsewhere
2024 since most of our companies use the Kazakhstan tenge as their functional currency, as compared to a foreign currency translation loss of $29.9 million for the three months ended September 30, 2023.
Previous report — wording carried elsewhere
In the three months ended September 30, 2024, total revenue, net in the Insurance segment increased mainly due to an increase in insurance underwriting income, reflecting the overall growth of our insurance operations between the two quarters.