Company: FRHC
Filing Date: 2025-08-08
Form Type: 10-Q
Source: 0000924805-25-000031
Chunk: 252

Company: Freedom Holding Corp.
Filing Date: 2025-08-08
Form: 10-Q
Item: Part I, Item 8
Chunk 252
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•In the three months ended June 30, 2025, the total expenses, net, in our Brokerage segment decreased by $9.2 million. The decrease was primarily driven by an $18.5 million decrease in interest expense, mainly related to lower interest paid on securities repurchase agreements. Advertising and sponsorship expenses in this segment also decreased by $3.7 million, as marketing activities were scaled back during the period. Additionally, allowance for expected credit losses decreased by $2.0 million. These decrease were partially offset by an increase in fee and commission expenses of $5.1 million, due to higher customer activity, and an $8.9 million rise in payroll and bonus expenses, reflecting our continued investment in attracting and retaining top talent.

Banking Segment

•In the three months ended June 30, 2025, total expenses, net in our Banking segment increased primarily due to $13.1 million increase in payroll and bonuses expense due to increase in headcount, increase for $6.7 million in provision for credit losses which is primarily attributable to increased provisions for right of claim for purchased loans, mortgage loans, collateralized bank customer loans and car loans which were partially offset by the recovery of uncollateralized bank customer loans. The increase in total expenses, net was also supported by a $3.1 million increase in fee and commission expense, in particular for the banking services, a $1.1 million increase in stock compensation expense primarily due to the vesting of stock grants awarded in prior periods. The increase was partially offset by the decrease for $20.7 million in interest expense on customer accounts, deposits and customer liabilities portfolio growth, a $0.1 million decrease in advertising and sponsorship expense and a $0.1 million decrease in general and administrative expense, in particular for the communication services and contributions to the Kazakhstan Deposit Guarantee Fund.

Insurance Segment

•In the three months ended June 30, 2025, total expenses, net in our insurance segment increased mainly due to a $33.0 million increase in insurance claims incurred, net of reinsurance due to claims paid in the class of  compulsory motor third-party liability (MTPL), redemption under pension annuity contracts, and termination of contracts under accident insurance. The segment also experienced a $9.6 million increase in stock compensation expense due to new stock grants, the majority of which vested on the date of issuance, a $1.3 million increase in 

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payroll and bonuses expense due to the increase