Company: FRHC
Filing Date: 2025-07-29
Form Type: ARS
Source: 0000924805-25-000027
Chunk: 121

Company: Freedom Holding Corp.
Filing Date: 2025-07-29
Form: ARS
Chunk 121
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 period in 2024. However, its composition changed due to shifts in funding sources and interest rate dynamics. There was a decrease in interest expense on securities repurchase agreement obligations, driven by a 8% decline in the average balance, from $2.6 billion during the fiscal year ended March 31, 2024 to $2.4 billion during the fiscal year ended March 31, 2025. Additionally, the average interest rate applied to these obligations decreased from 16% to 14%, further contributing to the reduction in costs. This decline primarily reflects the Company's decision to reduce exposure to market risk by liquidating a portion of the trading portfolio. Interest expense related to customer liabilities increased as the average balance of customer deposits and brokerage account liabilities grew 8% year-over-year, rising from $1.1 billion to $1.2 billion. This increase was caused by a higher average interest rate, which rose from 7% to 10%, reflecting both market-driven adjustments and an expanded customer deposit base. Additionally, interest expense on debt securities issued increased, primarily due to a rise in the average balance, from $131.0 million to $356.7 million. The average interest rate on these instruments also increased, from 8% to 10%, reflecting a shift toward long-term financing at higher prevailing market rates. This increase in debt securities expense Table of Contents 75

aligns with our broader funding strategy to support business expansion and strengthen liquidity reserves. During fiscal 2025, we issued an additional $200 million of debt securities, which contributed to the increase in average balance and interest expense. The following table provides a summary of the monthly average balances and average interest rates for the major categories of interest-bearing liabilities for the fiscal years ended March 31, 2025, and 2024. Year ended March 31, 2025 2024 Average balance Interest-bearing liabilities Securities repurchase agreement obligations $ 2,370,620 $ 2,590,599 Customer liabilities 1 1,157,574 1,070,098 Margin lending payable 647,966 218,730 Debt securities issued 356,653 131,047 Average rates Securities repurchase agreement obligations 14.38 % 15.54 % Customer liabilities 1 9.64 % 6.61 % Margin lending payable 7.06 % 7.77 % Debt securities issued 10.13 % 7.90 % Interest expense Interest expense on securities repurchase agreement obligations