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LOANS ISSUED
 6 Months Ended
Sep. 30, 2024
Loans and Leases Receivable Disclosure [Abstract]  
LOANS ISSUED LOANS ISSUED
Loans issued as of September 30, 2024, consisted of the following:
Amount OutstandingDue DatesAverage Interest Rate Fair Value of
Collateral		Loan Currency
 
Mortgage loans$766,949 October 2024 - September 204910.5%$766,949 KZT
Car loans201,429 October 2024 - April 203224.1%198,418 KZT
Uncollateralized bank customer loans231,863 October 2024 - September 204427.6%— KZT
Right of claim for purchased retail loans138,092 October 2024 - February 203015.0%138,092 KZT
Collateralized bank customer loans71,106 October 2024 - July 204316.9%66,603 KZT
Subordinated loan6,163 December 20253.0%— USD
Other1,744 October 2024 - September 2029
18.1%/4.5%
26 KZT/EUR
Allowance for loans issued(48,690)
Total loans issued$1,368,656 
The Group provides mortgage loans to borrowers on behalf of the JSC Kazakhstan Sustainability Fund (the "Program Operator") related to the state mortgage program "7-20-25" and transfers the rights to claim on the mortgage loans to the Program Operator. The proceeds received from these transfers are presented within funds received under state program for financing of mortgage loans in the Condensed Consolidated Statements of Cash Flows. Under this program, borrowers can receive a mortgage at an interest rate of 7% for 20 years, and the interest payments received by the Group are recognized as interest income in the Company’s Consolidated Statements of Operations and Statements of Other Comprehensive Income. In accordance with the program and trust management agreement for the program, the Group services the transferred loans and remits all repayments of principal it receives plus 4% of the 7% interest received to the Program Operator. The interest paid to the Program Operator is recognized as interest expense in the Condensed Consolidated Statements of Operations and Statements of Other Comprehensive Income. The remaining 3% of the 7% interest is retained by Group. Under the program and trust management agreement, the Group is required to repurchase the rights to make claims on the transferred loans when either loan principal repayments or interest payments are overdue 90 days or more. The repurchase of overdue loans is performed at the loans’ nominal value and is presented within repurchase of mortgage loans under the State Program in the Condensed Consolidated Statements of Cash Flows.

Since the Group transfers the rights to make claims on the loans with recourse for loans that are more than 90 days past due, retains part of the interest received on the loans and agrees to service the loans after the sale of the loans to the Program Operator, the Company has determined that the Group retains control over the loans transferred and continues recognizing the loans, which are accounted for as secured borrowings of the Group in accordance with ASC 860, Transfers and Servicing. As the Company continues to recognize the loans as assets, it also recognizes the associated liability equal to the proceeds received from the Program Operator, which is presented separately as liability arising from continuing involvement in the Condensed Consolidated Balance Sheets. This liability accrues 4% interest annually as described above. As of September 30, 2024 and March 31, 2024, the corresponding liability amounted to $506,091 and $521,885, respectively.
As of September 30, 2024 and March 31, 2024, mortgage loans include loans under the state mortgage program "7-20-25" with an aggregate principal amount of $519,763 and $532,389, respectively, were presented within loans issued in the Condensed Consolidated Balance Sheets.

The Group has an agreement with FFIN Credit, a company established and controlled by FRHC's controlling shareholder, chairman and chief executive officer, Timur Turlov, to purchase uncollateralized retail loans from FFIN Credit. FFIN Credit is a non-bank credit institution that issues loans in Kazakhstan under simplified lending procedures. FFIN Credit was created as a pilot project to test and improve the scoring models used for qualifying and issuing loans. The principal operation of FFIN Credit is to provide loans to customers online using biometric identification and its proprietary scoring process. After completion of the pilot project, it is anticipated that FFIN Credit will be sold by Mr. Turlov to the Company. Freedom Bank KZ has legal ownership over the loans purchased from FFIN Credit. However, in accordance with U.S. GAAP requirements, the Group does not recognize those loans, since effective control over the transferred loans are maintained by FFIN Credit. Instead, the Group recognizes the loans receivable from FFIN Credit as right of claim for purchased retail loans on the Consolidated Balance Sheets within loans issued. As of September 30, 2024 and March 31, 2024, right of claims for purchased retail loans amounted to $138,092 and $146,152, respectively.

The total accrued interest for loans issued amounted to $8,789 as of September 30, 2024 and $8,327 as of March 31, 2024.
Loans issued as of March 31, 2024, consisted of the following:
Amount OutstandingDue DatesAverage Interest Rate Fair Value of
Collateral		Loan Currency
 
Mortgage loans$741,312 April, 2024 - March, 204910.3%$740,462 KZT
Car loans262,708 April, 2024 - March, 203123.9%259,755 KZT
Uncollateralized bank customer loans245,188 April, 2024 - March, 204427.4%— KZT
Right of claim for purchased retail loans146,152 April, 2024 - March, 202915.0%146,152 KZT
Collateralized bank customer loans22,299 June, 2024 - July, 204319.1%22,270 KZT
Subordinated loan5,037 December, 20253.0%— USD
Other2,638 April, 2024 - January, 2029
18.6%/15.0%/2.5%
18 
KZT/USD/EUR
Allowance for loans issued(43,619)
Total loans issued$1,381,715 
Credit quality indicators

Freedom Bank KZ uses a loan portfolio quality classification system that indicates signs of a significant increase in credit risk and contractual impairment, depending on the analysis of reasonable and supportable information available at the reporting date. The loan portfolio is classified into “not credit impaired”, “with significant increase in credit risk” and “credit impaired” agreements.
Loans “not credit impaired” under the agreement are serviced as usual, there are no primary signs of an increase in credit risk. Agreements classified as “with significant increase in credit risk” represent loans for which there is an increase in the credit risk expected over the life of the agreement compared to the initial risk at the date of recognition of the loan. In practice, the presence of overdue debt on principal and interest for a period of more than 30 days or the absolute probability of default threshold PD exceeds 20%. Agreements classified as “credit impaired” represent loans for which at the reporting date there are signs of impairment, the borrower has been in default for 90 or more days for individuals and 60 or more days for legal entities, the borrower for the last 6 months for individuals and 12 months for legal entities restructured the contract due to the deterioration of the financial condition, the borrower is recognized as credit impaired, the presence of a sign of default, a sign of bankruptcy, the deterioration of the financial performance of the borrower, the presence of other information indicating the presence of a high credit risk.
The table below presents the Group's loan portfolio by credit quality classification and origination year as of September 30, 2024. Current vintage disclosure is the requirement due to first adoption of ASC 326.
Term Loans by Origination Fiscal Year
20252024202320222021PriorRevolving loansTotal
Mortgage loans$112,527 $211,478 $407,953 $34,991 $— $— $— $766,949 
that are not credit impaired112,527 209,358 404,368 34,418 — — — 760,671 
with significant increase in credit risk— 1,394 2,121 427 — — — 3,942 
that are credit impaired— 726 1,464 146 — — — 2,336 
Car loans1,772 150,666 48,991 — — — — 201,429 
that are not credit impaired1,772 145,830 37,587 — — — — 185,189 
with significant increase in credit risk— 1,574 1,422 — — — — 2,996 
that are credit impaired— 3,262 9,982 — — — — 13,244 
Uncollateralized bank customer loans39,831 164,352 27,673 7 — — — 231,863 
that are not credit impaired39,417 143,278 21,715 — — — — 204,410 
with significant increase in credit risk290 6,168 1,115 — — — — 7,573 
that are credit impaired124 14,906 4,843 7 — — — 19,880 
Right of claim for purchased retail loans73,288 59,489 5,264 51 — — — 138,092 
that are not credit impaired73,288 59,489 5,264 51 138,092 
with significant increase in credit risk— — — — — — — — 
that are credit impaired— — — — — — — — 
Collateralized bank customer loans55,810 15,105 191 — — — — 71,106 
that are not credit impaired55,810 14,978 191 — — — — 70,979 
with significant increase in credit risk— 32 — — — — — 32 
that are credit impaired— 95 — — — — — 95 
Subordinated loan— — 6,163 — — — — 6,163 
that are not credit impaired— — 6,163 — — — — 6,163 
with significant increase in credit risk— — — — — — — — 
that are credit impaired— — — — — — — — 
Other225 1,309 150 60 — — — 1,744 
that are not credit impaired225 1,301 150 60 — — — 1,736 
with significant increase in credit risk— — — — — — — — 
that are credit impaired— 8 — — — — — 8 
Total$283,453 $602,399 $496,385 $35,109 $— $— $— $1,417,346 
The table below presents the Group's loan portfolio by credit quality classification as of March 31, 2024.
Term Loans by Origination Fiscal Year
20242023202220212020PriorRevolving loansTotal
Mortgage loans$241,848 $458,401 $41,063 $— $— $— $— $741,312 
that are not credit impaired240,974 454,933 40,784 — — — — 736,691 
with significant increase in credit risk676 2,415 111 — — — — 3,202 
that are credit impaired198 1,053 168 — — — — 1,419 
Car loans196,305 66,403 — — — — — 262,708 
that are not credit impaired193,302 55,427 — — — — — 248,729 
with significant increase in credit risk1,590 2,232 — — — — — 3,822 
that are credit impaired1,413 8,744 — — — — — 10,157 
Uncollateralized bank customer loans210,612 34,568 8 — — — — 245,188 
that are not credit impaired200,211 30,337 — — — — — 230,548 
with significant increase in credit risk4,715 1,072 — — — — — 5,787 
that are credit impaired5,686 3,159 8 — — — — 8,853 
Right of claim for purchased retail loans130,291 15,694 167 — — — — 146,152 
that are not credit impaired130,291 15,694 167 — — — — 146,152 
with significant increase in credit risk— — — — — — — — 
that are credit impaired— — — — — — — — 
Collateralized bank customer loans21,972 327 — — — — — 22,299 
that are not credit impaired21,796 327 — — — — — 22,123 
with significant increase in credit risk89 — — — — — — 89 
that are credit impaired87 — — — — — — 87 
Subordinated loan— 5,037 — — — — — 5,037 
that are not credit impaired— 5,037 — — — — — 5,037 
with significant increase in credit risk— — — — — — — — 
that are credit impaired— — — — — — — — 
Other2,404 165 69 — — — — 2,638 
that are not credit impaired2,395 165 69 — — — — 2,629 
with significant increase in credit risk— — — — — — — — 
that are credit impaired9 — — — — — — 9 
Total$803,432 $580,595 $41,307 $— $— $— $— $1,425,334 
Aging analysis of past due loans as of September 30, 2024 and March 31, 2024, is as follows:
September 30, 2024
Loans 30-59 Days past due Loans 60-89 days past due Loans 90 days or more past due and still accruingCurrent loansTotal
Mortgage loans$2,602 $1,340 $2,336 $760,671 $766,949 
Car loans2,088 908 13,244 185,189 201,429 
Uncollateralized bank customer loans4,397 3,176 19,880 204,410 231,863 
Right of claim for purchased retail loans— — — 138,092 138,092 
Collateralized bank customer loans— 32 95 70,979 71,106 
Subordinated loan— — — 6,163 6,163 
Other— — 8 1,736 1,744 
Total$9,087 $5,456 $35,563 $1,367,240 $1,417,346 
March 31, 2024
Loans 30-59 Days past due Loans 60-89 days past due Loans 90 days or more past due and still accruingCurrent loansTotal
Mortgage loans$2,133 $1,069 $1,419 $736,691 $741,312 
Car loans2,167 1,655 10,157 248,729 262,708 
Uncollateralized bank customer loans3,576 2,211 8,853 230,548 245,188 
Right of claim for purchased retail loans— — — 146,152 146,152 
Collateralized bank customer loans— 89 87 22,123 22,299 
Subordinated loan— — — 5,037 5,037 
Other— — 9 2,629 2,638 
Total$7,876 $5,024 $20,525 $1,391,909 $1,425,334 

The activity in the allowance for credit losses for the three months ended September 30, 2024 and 2023 is summarized in the following tables.
Allowance for credit losses
Mortgage loanUncollateralized bank customer loansCollateralized bank customer loansCar loansRight of claim for purchased retail loansOtherTotal
March 31, 2024
$(3,033)$(19,636)$(80)$(14,262)$(6,577)$(31)$(43,619)
Charges(1,927)(14,416)(383)(2,699)(4,387)(27)(23,839)
Recoveries775 4,653 28 5,278 4,610 — 15,344 
Write off— 42 4 258 — 30 334 
Forex252 1,635 14 844 345 — 3,090 
September 30, 2024
$(3,933)$(27,722)$(417)$(10,581)$(6,009)$(28)$(48,690)
Allowance for credit losses
Mortgage loanUncollateralized bank customer loansCollateralized bank customer loansCar loansRight of claim for purchased retail loansOtherTotal
March 31, 2023
$(554)$(233)$— $(758)$(1,247)$— $(2,792)
Adjustment to allowance for adoption of ASU 2016-13(2,216)(7,436)(35)(6,462)(9,046)— (25,195)
Charges(665)(13,482)(71)(8,851)(11,073)(3,283)(37,425)
Recoveries1,599 6,384 36 2,558 7,746 — 18,323 
Forex91 739 4 637 657 — 2,128 
September 30, 2023
$(1,745)$(14,028)$(66)$(12,876)$(12,963)$(3,283)$(44,961)