Vanquis Banking : Moneybarn Limited Annual Report and Financial Statements for 2023

MONEYBARN LIMITED

(Company Number 02766324)

ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2023

MONEYBARN LIMITED

(Company Number 02766324)

CONTENTS

	Page
Directors' report	1
Strategic report	4
Statement of directors' responsibilities	13
Independent auditor's report to the members of Moneybarn Limited	14
Statement of comprehensive income	17
Balance sheet	18
Statement of changes in shareholders' equity	19
Statement of cash flows	20
Statement of accounting policies	21
Financial and capital risk management	26
Notes to the financial statements	28

MONEYBARN LIMITED

(Company Number 02766324)

DIRECTORS' REPORT

Moneybarn Limited (the 'Company') is part of Vanquis Banking Group plc. Vanquis Banking Group plc is a public limited company, listed on the London Stock Exchange, which, together with its subsidiaries, forms the Vanquis Banking Group (the 'Group'). The immediate parent of the Company is Moneybarn Group Limited.

The following provisions, which the directors are required to report in the Directors' report, have been included in the Strategic report:

• how the directors have engaged with colleagues, how they have had regard to colleague interests and the effect of that regard, including on the principal decision taken by the Company in the financial year (page 7); and,
• how the directors have had regard to the need to foster the Company's business relationship with suppliers, customers and others, and the effect of that regard, including on the principal decision taken by the Company in the financial year (pages 5 to 11).

Principal activities

The principal activity of the Company is to provide customer account management services to other companies in the Group, principally Moneybarn No.1 Limited.

Results

The Statement of comprehensive income for the year is set out on page 17. The loss for the year of £572,000 (2022: profit of £1,500,000) has been deducted from (2022: added to) retained earnings. The Company has net assets of £23,262,000 as at 31 December 2023 (2022: £23,459,000). The key drivers for the results in the current year have been considered in the Business review within the Strategic report.

Dividends

The directors do not propose the payment of a dividend in respect of the year ended 31 December 2023 (2022: £nil).

Directors

The directors of the Company during the year ended 31 December 2023, all of whom were directors for the whole year then ended and to the date of this report, except where stated, were:

M Le May	(resigned 1 August 2023)
D Shrimpton-Davis	(resigned 30	November 2023)
N Kapur	(resigned 7 August 2023)
C Anderson	(resigned 30	November 2023)
I McLaughlin	(appointed 1	August 2023)
D Watts	(appointed 30	November 2023)
G Cronin	(appointed 30	November 2023)
P Estlin	(appointed 23	January 2024)

Financial risk management

The financial and capital risk management reports of the Company are set out on pages 26 to 27.

Employee involvement

The Company systematically provides employees with information on matters of concern to them, consulting with them or their representatives regularly, so that their views may be taken into account when making decisions that are likely to affect their interests. Employee involvement in the Company is encouraged as a common awareness amongst all employees of the financial and economic factors affecting the Company and Group plays a major role in maintaining its competitive position. The Company encourages the involvement of employees by means of live "stay connected" all colleague question and answer sessions, weekly CEO Video blogs, newsletters, performance updates and regular management team briefings. The Company also carries out regular employee engagement surveys and Save As You Earn (SAYE) and Buy As You Earn (BAYE) share schemes are operated by the Group to reinforce staff involvement in the Group and to encourage an interest in its progress. These schemes are open to all permanent employees of the Company with more than six months' service.

1

MONEYBARN LIMITED

(Company Number 02766324)

DIRECTORS' REPORT (CONTINUED)

Equal opportunities

The Company is committed to removing all discrimination and encouraging diversity amongst the workforce. Open, honest and fair interaction is how we treat our people. The Company has worked hard and continue to work hard to create a positive, inclusive atmosphere, based on respect for people's differences. The Company is committed to equality of opportunity and treatment for all those who work for us.

The Company is committed to employment policies which follow best practice based on equal opportunities for all employees irrespective of gender, pregnancy, race, colour, nationality, ethnic or national origin, disability, sexual orientation, age, marital or civil partner status, gender reassignment, religion or belief. The Company gives full and fair consideration to applications for employment from disabled persons, having regard to their particular aptitudes and abilities. Appropriate arrangements are made for the continued employment and training, career development and promotion of disabled persons employed by the Company including making reasonable adjustments where required. If members of staff become disabled, every effort is made by the Company to ensure their continued employment, either in the same or an alternative position, with appropriate retraining being given if necessary.

Social and community matters

The Company's approach to community investment is aligned with the Group's Purpose to deliver caring banking so our customers can make the most of life's opportunities. Community investment activities are delivered through a Group-wide Social Impact Programme. The strategy of this programme is to invest in activities and initiatives which seek to address some of the key factors which, on their own or acting together, can reduce social and/or financial inclusion. This programme delivers community investment activities under the following three workstreams:

• Customer and vulnerability - working with charities and specialist partners to provide support which addresses issues such as customer vulnerability, product accessibility and financial difficulties;
• Education - supporting children, young people and adults to boost their education, skills and aspirations in order to participate in society and secure a brighter financial future; and
• Community - supporting Community Foundations and other partners to address the wide range of social inclusion and social mobility issues that are relevant to our customers and the communities where the Group operates. Colleagues are encouraged to engage with the volunteering programme which encourages participation in company-led volunteering, as well as offering one day per year to volunteer for a voluntary organisation of their choice. Matched funding of up to £500 per annum towards colleagues' own fundraising activities is also available.

Health and safety

Health and safety standards and benchmarks have been established and compliance is monitored by the Board. An annual health & safety report is reviewed and approved by the Board each year. During 2023 management reported to the Board on the key measures that had been implemented to ensure the health and safety of employees.

Climate change

A climate-related financial report is included in the Group's Annual Report and Financial Statements 2023 on pages 19 to 28 which includes:

• scope 1 and 2 greenhouse gas (GHG) emissions in tonnes of carbon dioxide equivalent;
• GHG emissions which related to material scope 3 categories in tonnes of carbon dioxide equivalent;
• compliance with four recommendations and eleven recommended disclosures of the Taskforce on
  Climate related financial disclosures ("TCFD");
• a relevant intensity ratio (i.e. kilograms of carbon dioxide equivalent per customer); and
• information on underlying energy use for 2023.

The disclosures are produced in accordance with the UK Government's Streamlined Energy and Carbon Reporting (SECR) policy that has been implemented through the Companies (Directors' Report) and Limited Liability Partnership (Energy and Carbon Report) Regulations 2018. This disclosure covers the greenhouse gas emissions and energy use for the Group and its operating divisions incorporating the Company.

In addition, by including a climate-related financial report in the Group's Annual Report and Financial Statements 2023 that is fully consistent with the four pillars and eleven recommended disclosures of the TCFD, the Group complies with the FCA's Listing Rule 9.8.6R(8) and meets the requirements of the Climate-related Financial Disclosure (CFD) Regulations 2022 and the UK Companies Act (that is, sections 414CB(2A)(a to h).

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MONEYBARN LIMITED

(Company Number 02766324)

DIRECTORS' REPORT (CONTINUED)

Anti-bribery and corruption

The Group's Anti-Bribery and Corruption Policy and supporting Gifts and Hospitality Policy reflects the requirements of the Bribery Act 2010 and a corporate hospitality register is maintained using a risk-based approach. Although the risks for the Company arising from the Bribery Act 2010 continue to be assessed as low, all employees are, nevertheless, required to undergo appropriate training and instruction to ensure that there is effective awareness of anti-bribery and corruption policies and procedures. Compliance is regularly monitored by the Risk Committee and is subject to periodic review by the Company's internal audit function.

Supply chain responsibility

In accordance with the requirements of the Modern Slavery Act 2015, the Group's most recent statement on modern slavery and human trafficking, dated March 2023, sets out the actions that the Group is taking to ensure instances of modern slavery or human trafficking are not occurring directly in its businesses as well as indirectly in the supply chains the Group uses to procure goods and services. The statement also communicates the measures the Group has taken to improve internal understanding and awareness around modern slavery and human trafficking.

The statement can be found on the Company's website (www.vanquisbankinggroup.com).

Auditor information

In accordance with section 418 of the Companies Act 2006, each person who is a director at the date of this report confirmed that:

1. so far as the director is aware, there is no relevant audit information of which the Company's auditor is unaware; and
2. the directors have taken all reasonable steps that he ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the Company's auditor is aware of that information.

Auditor

Deloitte LLP will continue as auditor to the Company for the next financial year.

Approved by the Board and signed on behalf of the Board by:

1. McLaughlin Director
   23 April 2024

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MONEYBARN LIMITED

(Company Number 02766324)

STRATEGIC REPORT

Business review

The following are considered the Company's Key Performance Indicators:

	2023	2022
Key Performance Indicators (KPIs)	£'000	£'000
(Loss)/profit before taxation	(574)	1,928

During the year, the Company serviced, on behalf of other Group companies, 50,800 new contracts (2022: 42,100), as well as maintaining the servicing of a portfolio of loan contracts which increased from 100,000 to 111,700 in the year.

Revenue grew by 48% to £61,495,000 (2022: £41,640,000), primarily as a result of the receivables growth within Moneybarn No.1 Limited which resulted in an increased intra-group revenue for the Company.

Administrative and operating costs increased by 56% to £61,732,000 (2022: £39,648,000) in line with the increase in revenue. During the current year, the Group underwent a transformation to ensure a unified approach under the new shared corporate services model which included a refresh of the statutory cost recharges model which resulted in an increase to/from other subsidiary undertakings.

Regulation

The Company is regulated and authorised by the Financial Conduct Authority.

Principal risks and uncertainties and financial risk management

The Company operates a 'three lines of defence' model to articulate key accountabilities and responsibilities for managing risk and to support effective embedding of risk management across the business. The 'first line' consists of line management across the Company, who are responsible for identifying, assessing, monitoring and reporting risk within their respective areas whilst ensuring that appropriate internal controls, processes and systems are in place to deliver against business strategy and objectives. The Risk function of the Company act as the 'second line', in which the Risk Management Framework is established. This function provides independent oversight of governance, risk management and controls to ensure risks are identified, measured, managed and reported appropriately. The 'third line' consists of the Internal Audit function, which provides independent and objective assurance on the design adequacy and operational effectiveness of internal controls and overall effectiveness of the Company and Group's risk governance and risk management practices.

Information on the management of specific financial risks including credit, market, liquidity, interest rate, and capital risks is provided on pages 26 to 27.

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MONEYBARN LIMITED

(Company Number 02766324)

STRATEGIC REPORT (CONTINUED)

Statement regarding section 172 of the Companies Act 2006

The directors have acted in a way that they considered, in good faith, would be most likely to promote the success of the Company for the benefit of its members as a whole, having regard to the matters set out in section 172(a) - (f) of the Companies Act 2006.

The Board met during the reporting period and received regular updates from management on engagement activities with the Company's key stakeholders including regulators, customers and colleagues. The Board is composed of three directors, all of whom are directors of the ultimate parent company which provides direct investor engagement and ensures that investors' views are considered during the Board's discussion and decisions.

Our purpose, as part of the Vanquis Banking Group, is predicated on our customers and is underpinned by a number of strategic themes and values. These aim to deliver an appropriate balance between the needs of our customers, our regulators, investors and our employees, in order to ensure that we are successful and sustainable for all of our stakeholders. Our stakeholders are individuals or groups who have an interest in, or are affected by, the activities of our business; our key stakeholders are set out in the table below. We seek to engage with them regularly to ensure that we are aware of their views and concerns with regard to a wide range of issues and we do this in a number of ways, as detailed in the below table. By balancing the interests of our stakeholders, lending responsibly, contributing to wider society and ensuring the appropriate corporate governance arrangements are in place, we can maintain a reputation for high standards of business conduct. You can read about how we have generated and preserved value over the long term in the Strategic report.

Our Stakeholders	How? (How management	What? (What were the key	Key outcomes and actions
and why we engage	and/or directors engaged with	topics of engagement and	(What was the impact of the
with them	and considered our	consideration)	engagement and/or
	stakeholders)			consideration?)
Our Customers	∙ Utilising a wide variety of	∙	Supporting customers	∙	Enhanced forbearance
We engage with our		customer engagement		through the cost of living		measures to support
	methods including, third		crisis, including forbearance		customers through the cost-
customers to		party research, and		measures		of-living crisis and Board-
determine whether
	complaints monitoring	∙	Customer affordability,		level oversight over the
we are delivering our
∙ Customer call listening by		vulnerability and persistent		impact of the crisis on our
business activities in
	the Group's Customer,		debt		customers
accordance with our			∙
	Culture and Ethics	∙	Customer outcomes aligned	Management and Board
purpose and ensuring
	Committee which was fed		with the FCA Consumer		oversight of customer
that we deliver good
	back to the Company		Duty		complaints operations,
outcomes for them
∙	Monitoring performance	∙	Customer satisfaction,		outcomes, strategy and
throughout their
journey with us.		against good customer		service level agreements,	∙	vulnerable customers
		outcomes		care, service and	Board approved an
Our customers'	∙	Considering the customer		complaints		operational outsourcing
interests include		experience, customer	∙ Policy suite including, but		arrangement with
access to affordable		journeys and outcomes		not limited to, Anti Money		Teleperformance to improve
vehicle finance that	∙	Designing and		Laundering ('AML'), Data		the quality of service
meet their needs as		implementing policies that		Protection, Complaints		provided to our customers
well as high quality		protect and support		Handling, Forbearance,	∙ Partnership with Leasoo for
service.
	customers		Collections, Vulnerable		brand new vehicles via
	∙	Management reports to		Customers and Financial		personal contract hire
		the Board on the above	∙	Promotions
		methods of engagement	Continued partnership with
		and the outcomes of such	∙	Stepchange
		engagement	Access to electronic
				vehicles

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MONEYBARN LIMITED

(Company Number 02766324)

STRATEGIC REPORT (CONTINUED)

Our Stakeholders and	How? (How management and/or	What? (What were the key	Key outcomes and actions
why we engage with	directors engaged with and	topics of engagement and	(What was the impact of the
them	considered our stakeholders)	consideration)	engagement and/or
				consideration?)
Our shareholder	∙ Two of the Company Directors	∙	Strategy and long-term	∙	Business model aligned with
The Company is a	are members of the Group		value creation	∙	the Group's purpose
Executive Committee	∙	Culture and The	Board-level oversight over
wholly owned	∙ Financial reporting, strategy		Vanquis Way values		the Group Risk Policy
subsidiary of	and common accounting	∙	Financial and		Taxonomy, Group Risk
Moneybarn Group	principles are utilised across		operational		System and Group
Limited, whose ultimate			Enterprise Risk
the Group to provide		performance
parent is Vanquis			Management function to
alignment	∙	Harmonisation of risk
Banking Group plc, and		ensure a consistent
∙ The Budget and financial plan		management to
as such it is of			approach to risk
are developed as part of the		provide a consistent
paramount importance			management across the
wider Group process		and integrated
that the Group is kept			Group
updated on the	∙ The Group has an aligned		approach to managing	∙	Group Board and Company
Company's progress in	corporate governance	∙	risk across the Group		Board refreshed their
delivering the Group's	framework and structure and	Corporate governance		corporate governance
shared purpose, its	Group wide Delegated		arrangements and		framework to support
budget, its strategy,	Authorities Matrix		alignment		effective decision-making,
governance, and	∙ The Group has a centralised	∙	Corporate		oversight and accountability
culture. Direct and	Corporate Responsibility team		responsibility	∙	Board approved intra-group
regular engagement	and a Group-wide approach to	∙	Interactions with the		funding arrangements to
with our shareholder	Corporate Social		regulators		provide more cost-efficient
ensures that the
Responsibility.	∙	Consideration of credit		funding across the Group
Company has a clear	∙
∙ Participating in the Group's		risk and lending policy	Input into the Group's
understanding of its			Internal Capital Adequacy
capital funding plan and		in the macro-economic
role as part of the
		Assessment Process
contributing to the		environment,
Group.
	∙	Board and Group Board
	strenghtening of the Group's		specifically arising from
			approved budget and
Our ultimate	capital, liquidity and funding		the cost-of-living crisis
		operational plan
shareholders' interests	structure.		during the year
	∙	Board governance manual
include return on		∙	Operational Resilience
		and aligned delegated
investment, long-term		∙	ICAAP and ILAAP
		authorities matrix
growth and good ESG			process input
performance.
	∙	Intragroup funding
			arrangements
		∙	Market and competitor
			landscape

6

MONEYBARN LIMITED

(Company Number 02766324)

STRATEGIC REPORT (CONTINUED)

Our Stakeholders	How? (How management and/or	What? (What were the key	Key outcomes and actions
and why we engage	directors engaged with and	topics of engagement and	(What was the impact of the
with them	considered our stakeholders)	consideration)	engagement and/or
						consideration?)
Our colleagues	∙ A colleague culture survey was	∙	Review of colleague	∙	Colleague survey action
To ensure that they		issued halfway through the year		survey results		plans to address any areas
	and a 'Great Place To Work'	∙	Culture, purpose,		for improvement and
understand the		survey was issued at the year		values and behaviours		celebrate areas of
Group's purpose and		end	∙	Group aligned		achievement
how they can support
∙	Colleague Forums with		Colleague reward and	∙ Collective consultation on the
its delivery, which we
	representatives from the		recognition		Group's restructure via the
believe helps our
	Company and other businesses	∙	Group aligned HR		Colleague Forums with a
customer base. To
	across the Group provided two-		Policies		number of colleague counter-
maintain high levels
	way engagement between the	∙	Training, leadership		proposals being accepted.
of colleague		∙
engagement in order		Group Board and colleagues		development and	Launched an online
to enable us to	∙ Regular Group CEO vlogs and		succession planning		Development Centre for
attract, retain and		e-communications issued to	∙	Employee engagement		colleagues including
develop the talent we		colleagues on important Group	∙	Colleague wellbeing at		information on training,
need.	∙	news and updates.		work		apprenticeships,
Our colleagues'	Designated Group Non-	∙	Inclusion and affinity		management leadership and
	Executive Director Colleague		Group pillars such as		other professional
interests include:		Champion plays the lead role in		gender balance,		development programmes
∙	Career		Group Board engagement with		∙	Launched the Group's
		ethnicity, disability and
	development,		employees, understanding and		LGBTQ+		values under The Vanquis
	remuneration and		representing employee interests	∙	Review of workforce		Way and linked recognition
	benefits
∙		across the Group		engagement		platform, 'Way to Go, to
Company culture,	∙ The Group has an active,			foster a culture where we
	mechanisms
	wellbeing,		Executive sponsored, inclusion				say 'thank you' or 'well done'
	inclusion and		programme				to colleagues who
	diversity, work	∙	A confidential, externally				demonstrate our values.
∙	life balance		facilitated whistleblowing line is
Tools and		available for colleagues to raise
	resources and		concerns
	supporting our
	customers

7

MONEYBARN LIMITED

(Company Number 02766324)

STRATEGIC REPORT (CONTINUED)

Our Stakeholders	How? (How management and/or	What? (What were the	Key outcomes and actions
and why we engage	directors engaged with and	key topics of engagement	(What was the impact of the
with them	considered our stakeholders)	and consideration)	engagement and/or
					consideration?)
Our communities	∙ Participation in the Group	∙	Community	∙ Group volunteering policy to
To make a positive		Social Impact Programme that		contributions and		encourage colleagues to
	delivers community investment		charitable giving		volunteer and make a positive
difference to the	∙ The Company participated in	∙	Volunteering		difference in their
communities we		the Group Customer, Culture	∙	Matched employee		communities
serve in order to
	and Ethics Committee at which		fundraising	∙ Group approach to external
improve the lives of
	Group-wide community matters	∙	Relationships with		engagement regarding the
our customer base.
	are discussed and overseen by		debt charities		Company's purpose and role
Our communities'		the Group Board	∙	Group Social Impact	∙	in society
∙ Oversight by the Group Board		programme	Matched employee charitable
interests include
financial education,		and Customer, Culture and				fundraising
	Ethics Committee of community			∙ The Group Social Impact
addressing the key
barriers to financial		matters and the approach to				Programme is aligned to the
inclusion, social		external engagement regarding				Group's strategy and purpose
mobility and		the Company's purpose and				and has delivered community
improving financial		role in society				investment focused on
awareness.						community, customers and
						education
					∙
Our regulators	∙ Board members and executive	∙	Customer	∙	Group-wide compliance with
To plan for regulatory		management engaged		vulnerability,		the Operational Resilience
	proactively with regulators via	∙	Compliance with		Regulations, with Board
change with greater		regular face to face and		Consumer Duty rules		oversight of the project.
certainty and		telephone meetings throughout		to deliver good	∙ Group-wide participation in the
confidence, to		the year.		customer outcomes		Consumer Duty programme,
maintain our	∙	Regulatory risk reporting,	∙	Affordability		with the Company CRO
reputation as a		including horizon scanning, was		assessments		reporting regularly to the
responsible lender		carried out and reported to the	∙	Our products, our		Board on implementation and
and to maintain our		Company Risk Committee and		potential products		embedding.
sustainable business		Board as well as to the Group		and digitisation	∙ Business model aligned with
model.		Executive Committee and	∙	Complaint levels and		regulatory expectations
Our regulators'		Group Risk Committee where		handling	∙	Continued partnership with
	appropriate	∙	Compliance with the		StepChange
interests include	∙	Regulatory engagement and		Senior Management	∙ Co-operation with the FCA on
conduct, compliance		correspondence was reported to		& Certification		Borrowers in Financial
and fair treatment of		and discussed by the Board via		Regime		Difficulty Project
stakeholders.		the Company Chief Risk Officer	∙	Culture	∙ SMCR ways of working
	∙	(CRO) and Group CEO	∙	Payment holidays		Framework
	Dialogue and engagement		and other
		regarding current products,		forbearance options
		potential products, customer	∙	Regulatory changes
		outcomes and digitisation		and the potential
		primarily through the Company
			impact on our
		CRO
			business model and
	∙ Management reports to the
		processes
		Board on the above methods of
		∙	FCA BiFD Plan
		engagement and the outcomes		including ratification
		of such engagement
			of 2021 BiFD
				Remediation Plan
				approach
			∙

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