On November 30, 2020, S&P Global Ratings revised the outlook on IC Freedom Finance LLC and Freedom Finance JSC to positive from stable. At the same time, the rating agency affirmed the 'B-/B' long- and short-term ratings on both entities. S&P also raised its Kazakh national scale ratings on Freedom Finance JSC to 'kzBB' from 'kzBB-', the rating agency informed.
The outlook revision is largely based on the significant improvement of Freedom Holding's earnings capacity in 2020, thanks to higher business volumes. Stronger retail interest in financial markets, in particular in Russia, and closer interaction with FFIN Brokerage Services Ltd., a party under common control, have resulted in a material increase in commissions or the group. As result, in the first half of fiscal 2021 (ending March 31, 2021), the group achieved a return on equity exceeding 60%. Consequently, group's core earnings may exceed 200 basis points of S&P Global Ratings' risk-weighted assets on a three-year average basis, a level S&P would consider strong.
Freedom Finance LLC is operating as part of international holding company Freedom Holding Corp. providing financial services in the Russian Federation.
