Tetragon Financial Gr : up Limited U.S. GAAS Independent Auditor’s Report and Financial Statements 2020

FINANCIAL STATEMENTS

TETRAGON FINANCIAL GROUP LIMITED

FOR THE YEAR ENDED 31 DECEMBER 2020

TETRAGON FINANCIAL GROUP LIMITED

FINANCIAL STATEMENTS

For the year ended 31 December 2020

CONTENTS

	PAGE
DIRECTORS' REPORT	2
INDEPENDENT AUDITOR'S REPORT	4
FINANCIAL STATEMENTS
CONSOLIDATED STATEMENT OF FINANCIAL POSITION	6
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME	7
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY	8
CONSOLIDATED STATEMENT OF CASH FLOWS	9
NOTES TO THE FINANCIAL STATEMENTS	10

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TETRAGON FINANCIAL GROUP LIMITED

DIRECTORS' REPORT

For the year ended 31 December 2020

The Directors present to the shareholders their report together with the audited consolidated financial statements for the year ended 31 December 2020.

The Fund and its Investment Objective

Tetragon Financial Group Limited ("Tetragon" or the "Fund") was registered in Guernsey on 23 June 2005 as a company limited by shares, with registered number 43321. All voting shares of Tetragon are held by Polygon Credit Holdings II Limited (the "Voting Shareholder"). Tetragon continues to be registered and domiciled in Guernsey, Tetragon's non-voting shares are listed on Euronext in Amsterdam, a regulated market of Euronext Amsterdam N.V. (ticker symbol: TFG.NA) and on the Specialist Fund Segment of the London Stock Exchange plc (ticker symbols: TFG.LN and TFGS.LN).

Tetragon's investment objective is to generate distributable income and capital appreciation. It aims to provide returns to investors across various credit, equity, interest rate, inflation, and real estate cycles. Tetragon invests in a broad range of assets, including public and private equities, credit, convertible bonds, real estate, venture capital, infrastructure, bank loans, and TFG Asset Management, a diversified alternative asset management business.

As of 31 December 2020, TFG Asset Management's investments consisted of LCM, BentallGreenOak, Polygon, Equitix, Hawke's Point, Tetragon Credit Partners, Banyan Square Partners and Contingency Capital.

TFG Asset Management LP and Tetragon Financial Management LP (the "Investment Manager"), are both registered as investment advisers under the U.S. Investment Advisers Act of 1940, and two of TFG Asset Management LP's investment management entities, Polygon Global Partners LLP and Equitix Investment Management Limited, are authorised and regulated by the United Kingdom Financial Conduct Authority.

Results, Activities and Future Developments

The results of operations are set out on page 7. A detailed review of activities and future developments is contained in the Annual Report issued with these consolidated financial statements to the shareholders of Tetragon.

Statement of Directors' Responsibilities

The directors of Tetragon Financial Group Limited ('the Directors') have accepted responsibility for the preparation of these consolidated financial statements, to comply with the requirements of the US Investment Advisors act of 1940, for the year ended 31 December 2020 which are intended by them to give a true and fair view of the state of affairs of the Fund and of the profit or loss for that period. They have decided to prepare the consolidated financial statements in accordance with International Financial Reporting Standards ("IFRS") as adopted by the European Union ("EU") and with respect to the information contained in note 20 to the consolidated financial statements, in accordance with US Generally Accepted Accounting Principles ("US GAAP").

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TETRAGON FINANCIAL GROUP LIMITED

DIRECTORS' REPORT (continued)

For the year ended 31 December 2020

Statement of Directors' Responsibilities (continued)

In preparing those Financial Statements, the Directors are required to:

• select suitable accounting policies and apply them consistently;
• make judgments and estimates that are reasonable and prudent;
• state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the Financial Statements;
• assess the Fund's ability to continue as a going concern, disclosing, as applicable, matters related to going concern; and
• use the going concern basis of accounting unless they either intend to liquidate the Fund or to cease operations, or have no realistic alternative but to do so.

The directors are responsible for such internal control as they determine is necessary to enable the preparation of Financial Statements that are free from material misstatement, whether due to fraud or error, and have general responsibility for taking such steps as are reasonably open to them to safeguard the assets of the Fund and to prevent and detect fraud and other irregularities.

Signed on behalf of the Board of Directors by:

David O'Leary	Steven Hart
Director	Director
Date: 29 April 2021

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TETRAGON FINANCIAL GROUP LIMITED

INDEPENDENT AUDITOR'S REPORT

For the year ended 31 December 2020

To the Board of Directors and the Members of

Tetragon Financial Group Limited

Report on the Financial Statements

We have audited the accompanying consolidated financial statements of Tetragon Financial Group Limited (the "Company") and its subsidiary (together the "Group"), which comprise the consolidated statements of financial position, including the condensed schedules of investments, as of December 31, 2020 and 2019, and the related consolidated statements of comprehensive income, changes in equity, and cash flows for the years then ended, and the related notes to the consolidated financial statements.

Management's Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with International Financial Reporting Standards as adopted by the European Union; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

Auditors' Responsibility

Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditors' judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Group as of December 31, 2020 and 2019, and the results of its operations, changes in its equity, and its cash flows for the years then ended in accordance with International Financial Reporting Standards as adopted by the European Union.

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