Category: Banking

MIL-OSI Economics: Monetary developments in the euro area: March 2025
Source: European Central Bank

29 April 2025

Components of the broad monetary aggregate M3

The annual growth rate of the broad monetary aggregate M3 decreased to 3.6% in March 2025 from 3.9% in February, averaging 3.7% in the three months up to March. The components of M3 showed the following developments. The annual growth rate of the narrower aggregate M1, which comprises currency in circulation and overnight deposits, increased to 3.8% in March from 3.4% in February. The annual growth rate of short-term deposits other than overnight deposits (M2-M1) decreased to 1.5% in March from 2.0% in February. The annual growth rate of marketable instruments (M3-M2) decreased to 11.3% in March from 18.0% in February.

Chart 1

Monetary aggregates

(annual growth rates)

Data for monetary aggregates

Looking at the components’ contributions to the annual growth rate of M3, the narrower aggregate M1 contributed 2.4 percentage points (up from 2.2 percentage points in February), short-term deposits other than overnight deposits (M2-M1) contributed 0.4 percentage points (down from 0.6 percentage points) and marketable instruments (M3-M2) contributed 0.7 percentage points (down from 1.1 percentage points).

Among the holding sectors of deposits in M3, the annual growth rate of deposits placed by households stood at 3.5% in March, compared with 3.4% in February, while the annual growth rate of deposits placed by non-financial corporations decreased to 2.3% in March from 3.0% in February. Finally, the annual growth rate of deposits placed by investment funds other than money market funds increased to 16.2% in March from 8.5% in February.

Counterparts of the broad monetary aggregate M3

The annual growth rate of M3 in March 2025, as a reflection of changes in the items on the monetary financial institution (MFI) consolidated balance sheet other than M3 (counterparts of M3), can be broken down as follows: net external assets contributed 2.7 percentage points (down from 3.1 percentage points in February), claims on the private sector contributed 2.1 percentage points (down from 2.2 percentage points), claims on general government contributed 0.2 percentage points (as in the previous month), longer-term liabilities contributed -1.3 percentage points (up from -1.5 percentage points), and the remaining counterparts of M3 contributed -0.1 percentage points (as in the previous month).

Chart 2

Contribution of the M3 counterparts to the annual growth rate of M3

(percentage points)

Data for contribution of the M3 counterparts to the annual growth rate of M3

Claims on euro area residents

The annual growth rate of total claims on euro area residents stood at 1.7% in March 2025, unchanged from the previous month. The annual growth rate of claims on general government stood at 0.4% in March, unchanged from the previous month, while the annual growth rate of claims on the private sector stood at 2.2% in March, compared with 2.3% in February.

The annual growth rate of adjusted loans to the private sector (i.e. adjusted for loan transfers and notional cash pooling) increased to 2.6% in March from 2.4% in February. Among the borrowing sectors, the annual growth rate of adjusted loans to households increased to 1.7% in March from 1.5% in February, while the annual growth rate of adjusted loans to non-financial corporations increased to 2.3% in March from 2.1% in February.

Chart 3

Adjusted loans to the private sector

(annual growth rates)

Data for adjusted loans to the private sector

Notes:
- Data in this press release are adjusted for seasonal and end-of-month calendar effects, unless stated otherwise.
- “Private sector” refers to euro area non-MFIs excluding general government.
- Hyperlinks lead to data that may change with subsequent releases as a result of revisions. Figures shown in annex tables are a snapshot of the data as at the time of the current release.
MIL OSI Economics –
April 29, 2025
MIL-OSI Economics: Piero Cipollone: Navigating a fractured horizon: risks and policy options in a fragmenting world

Source: European Central Bank

Speech by Piero Cipollone, Member of the Executive Board of the ECB, at the conference on “Policy challenges in a fragmenting world: Global trade, exchange rates, and capital flow” organised by the Bank for International Settlements, the Bank of England, the ECB and the International Monetary Fund

Frankfurt am Main, 29 April 2025

I’m honoured to welcome you to this conference, jointly organised by the Bank for International Settlements (BIS), the Bank of England, the European Central Bank (ECB) and the International Monetary Fund (IMF).^[1]

Today, we come together to discuss the urgent challenges posed by global fragmentation – a growing risk to our interconnected world. Earlier this month, the President of the United States announced tariff hikes, sending shockwaves through the global economy – a stark reminder that the fractures we face are no longer hypothetical, but real.

This announcement is but the latest chapter in a series of four major shocks that have been reshaping our world in recent years.

First, since 2018 the intensifying power struggle between the United States and China has led to tit-for-tat tariffs affecting nearly two-thirds of the trade between these two economic giants. Second, starting in 2020, the pandemic caused unprecedented disruptions to supply chains, which prompted a re-evaluation of the balance between global integration and resilience. Third, in 2022 Russia’s unjustified invasion of Ukraine not only triggered an energy crisis but also deepened a geopolitical divide that continues to have worldwide repercussions. And fourth, we are now facing the rising risk of economic fragmentation within the western bloc itself, as new trade barriers threaten long-standing international partnerships.

The data paint a sobering picture. Geopolitical risk levels have surged to 50% above the post-global financial crisis average, and uncertainty surrounding trade policy has risen to more than eight times its average since 2021.^[2] What we are experiencing is not merely a temporary disruption – it is a profound shift in how nations interact economically, financially and diplomatically. So, it does not come as a surprise that financial markets have experienced considerable volatility in recent weeks. It remains to be seen if, for markets to find a stable equilibrium, it will be enough to step back from the current international economic disorder towards a more stable, predictable and reliable trading system – a development that appears elusive in the short term. Against this backdrop, recent moves in exchange rates, bond yields and equities, suggest that US markets have not been playing their usual role as a safe haven in this particular episode of stress. This potentially has far-reaching longer-term implications for capital flows and the international financial system.

Today I will focus on three key points. First, we are seeing increasing signs of fragmentation becoming visible across the economy and financial system. Second, the implications of this accelerating fragmentation could extend far beyond the immediate disruptions, with consequences for growth, stability and prosperity. Third, in this evolving economic landscape, central banks must adapt their approaches yet retain a steadfast focus on their core mandates, while striving to preserve international cooperation.

The emerging reality of fragmentation

Let me begin by addressing a common belief – still held by many until recently – that, despite rising geopolitical tensions, globalisation appears largely resilient. Headline figures in trade and cross-border investment, for example, do indeed appear to support this belief. In 2024 world trade expanded to a record USD 33 trillion – up 3.7% from 2023. Similarly, the global stock of foreign direct investment reached an unprecedented USD 41 trillion.^[3] However, these surface-level indicators may not reflect the underlying realities, creating a misleading sense of stability when important changes are already underway. In reality, fragmentation is already happening in both the global economy and the financial system.

Fragmentation of the real economy

Fragmentation is most evident in rebalancing trade, driven by escalating geopolitical tensions. Take, for instance, the escalating US-China trade tensions that have been intensifying since 2018. Studies show the impact of geopolitical distance on trade has become notably negative. A doubling of geopolitical distance between countries – akin to moving from the position of Germany to that of India in relation to the United States – decreases bilateral trade flows by approximately 20%.^[4]

The series of shocks to the global economy in recent years have also contributed to this fragmentation. According to gravity model estimates, trade between geopolitically distant blocs has significantly declined. Trade between rivals is about 4% lower than it might have been without the heightened tensions post-2017, while trade between friends is approximately 6% higher.^[5] Global value chains are being reconfigured as companies respond to these new realities. In 2023 surveys already indicated that only about a quarter of leading firms operating in the euro area^[6] that sourced critical inputs from countries considered subject to elevated risk had not developed strategies to reduce their exposure.^[7]

However, these shifting trade patterns have not yet been reflected in overall global trade flows. Non-aligned countries have played a crucial role as intermediaries, or connectors, helping to sustain global trade levels even as direct trade between rival blocs declines.^[8] But this stabilising influence is unlikely to endure as trade fragmentation deepens and geopolitical alliances continue to shift.

The tariffs announced by the US Administration are far-reaching and affect a substantial share of global trade flows. The effects on the real economy are likely to be material. In its World Economic Outlook, published last week, the International Monetary Fund revised down global growth projections for 2025-26 by a cumulative 0.8 percentage points and global trade by a cumulative 2.3 percentage points.^[9] This notably reflects a negative hit from tariffs that ranges between 0.4% to 1% of world GDP by 2027.^[10] In particular, IMF growth projections for the United States have been revised down by a cumulative 1.3 percentage points in 2025-26. The cumulative impact on euro area growth is smaller, at 0.4 percentage points.

Financial fragmentation

The fragmentation we are witnessing in global trade is mirrored in the financial sector, where geopolitical tensions are also reshaping the landscape.

In recent years, global foreign direct investment flows have increasingly aligned with geopolitical divides. Foreign direct investment in new ventures has plunged by nearly two-thirds between countries from different geopolitical blocs. However, strong intra-bloc investments have helped sustain overall foreign direct investment levels globally, masking some of the fragmentation occurring beneath the surface.^[11]

But, as with trade flows, this dynamic is unlikely to persist as geopolitical tensions grow within established economic blocs. For instance, increased geopolitical distance is shown to curtail cross-border lending. A two standard deviation rise in geopolitical distance – akin to moving from the position of France to that of Pakistan in relation to Germany – leads to a reduction of 3 percentage points in cross-border bank lending.^[12]

The impact of fragmentation in global financial infrastructure is perhaps even more revealing. Since 2014 correspondent banking relationships – crucial for facilitating trade flows across countries – have declined by 20%. While other factors – such as a wave of concentration in the banking industry, technological disruptions and profitability considerations – have played a role^[13], the contribution of the geopolitical dimension can hardly be overstated. The repercussions of this decline can be profound. Research shows that when correspondent banking relationships are severed in a specific corridor, a firm’s likelihood of continuing to export between the two countries of that corridor falls by about 5 percentage points in the short term, and by about 20 percentage points after four years.^[14]

Contributing to this trend, countries such as China, Russia and Iran have launched multiple initiatives to develop alternatives to established networks such as SWIFT, raising the possibility of a fragmented global payment system.^[15] Geopolitical alignment now exerts a stronger influence than trade relationships or technical standards in connecting payment systems between countries.^[16] This poses risks of regional networks becoming more unstable, increased trade costs and settlement times, and reduced risk sharing across countries.

Additionally, we are witnessing a noticeable shift away from traditional reserve currencies, with growing interest in holding gold. Central banks purchased more than 1,000 tonnes of gold in 2024, almost double the level of the previous decade, with China being the largest purchaser, at over 225 tonnes. At market valuations, the share of gold in global official reserves has increased, reaching 20% in 2024, while that of the US dollar has decreased. Survey data suggest that two-thirds of central banks invested in gold to diversify, 40% to protect against geopolitical risk and 18% because of the uncertainty over the future of the international monetary system.^[17] There are further signs that geopolitical considerations increasingly influence decisions to invest in gold. The negative correlation of gold prices with real yields has broken down since 2022, a phenomenon we have also observed in recent weeks. This suggests that gold prices have been influenced by more than simply the use of gold to hedge against inflation. Moreover, countries geopolitically close to China and Russia have seen more pronounced increases in the share of gold in official foreign reserves since the last quarter of 2021.

The looming consequences of fragmentation

Accelerating fragmentation is resulting in the immediate disruptions we are now seeing, but this is likely to only be the beginning – potentially profound medium and long-term consequences for growth, stability and prosperity can be expected.

Medium-term impacts

The initial consequences of fragmentation are already evident in the form of increased uncertainty. In particular, trade policy uncertainty has led to a broader rise in global economic policy instability, which is stifling investment and dampening consumption. Our research suggests that the recent increase in trade policy uncertainty could reduce euro area business investment by 1.1% in the first year and real GDP growth by around 0.2 percentage points in 2025-26^[18]. Consumer sentiment is also under strain, with the ECB’s Consumer Expectations Survey revealing that rising geopolitical risks are leading to more pessimistic expectations, higher income uncertainty and ultimately a lower willingness to spend.^[19] Moreover, ECB staff estimates suggest that the observed increase in financial market volatility might imply lower GDP growth of about 0.2 percentage points in 2025.

Over the medium term, tariffs are set to have an unambiguously recessionary effect, both for countries imposing restrictions and those receiving them. The costs are particularly high when exchange rates fail to absorb tariff shocks, and some evidence suggests exchange rates have become less effective in this role.^[20]

The Eurosystem’s analysis of potential fragmentation scenarios suggests that such trade disruptions could turn out to be significant. In the case of a mild decoupling between the western (United States-centric) and the eastern (China-centric) bloc, where trade between East and West reverts to the level observed in the mid-1990s, global output could drop by close to 2%.^[21] In the more extreme case of a severe decoupling – essentially a halt to trade flows – between the two blocs, global output could drop by up to 9%. Trade-dependent nations would bear the brunt of these trade shocks, with China potentially suffering losses of between 5% and 20%, and the EU seeing declines ranging from 2.4% to 9.5% in the mild and severe decoupling scenarios respectively. The analysis also shows that the United States would be more significantly affected if it imposed additional trade restrictions against western and neutral economies – with real GDP losses of almost 11% in the severe decoupling scenario – whereas EU losses would increase only slightly in such a case.^[22]

The inflationary effects of trade fragmentation are more uncertain. They depend mainly on the response of exchange rates, firms’ markups and wages. Moreover, they are not distributed equally. While higher import costs and the ensuing price pressures are likely to drive up inflation in the countries raising tariffs, the impact is more ambiguous in other countries as a result of the tariffs’ global recessionary effects, which push down demand and commodity prices, as well as of the possible dumping of exports from countries with overcapacity. The short to medium-term effects may even prove disinflationary for the euro area, where real rates have increased and the euro has appreciated following US tariff announcements.

In fact, a key feature of most model-based assessments is that higher US tariffs lead to a depreciation of currencies against the US dollar, moderating the inflationary effect for the United States and amplifying it for other countries. But so far we have seen the opposite: the risk-off sentiment in response to US tariff announcements and economic policy uncertainty have led to capital flows away from the United States, depreciating the dollar and putting upward pressure on US bond yields. Conversely, the euro area benefited from safe haven flows, with the euro appreciating and nominal bond yields decreasing.

Long-term structural changes

The long-term consequences of economic fragmentation are inherently difficult to predict, but by drawing on historical examples and recognising emerging trends, it’s clear that we are on the verge of significant structural changes. Two areas stand out.

The first one is structurally lower growth. On this point, international economic literature has reached an overwhelming consensus.^[23] Quantitatively, point estimates might vary. For example, research of 151 countries spanning more than five decades of the 20th century reveals that higher tariffs have typically led to lower economic growth. This is largely due to key production factors – labour and capital – being redirected into less productive sectors.^[24]

However, data from the late 19th and early 20th centuries, a period which tariff supporters often look back to, seem to tell a different story. At that time, trade barriers across countries were high – the US effective tariff rate, for example, reached almost 60%, twice as high as after the 2 April tariffs. And sometimes countries imposing higher trade barriers enjoyed higher growth, which may provide motivation for current policymakers’ trade tariff policies. But these episodes need to be read in historical context. Before 1913, tariffs mostly shielded manufacturing, a high-productivity sector at the time, attracting labour from other, less productive sectors, like agriculture. Therefore, their negative effects were mitigated by the expansion of industries at the frontier of technological innovation. Moreover, the interwar years offer further nuance – the Smoot-Hawley tariffs of the 1930s had relatively limited direct effects on US growth, mainly because trade accounted for just 5% of the economy.

But today’s tariffs are unlikely to replicate the positive effects seen in the 19th century. Instead, they risk creating the same inefficiencies observed in the course of the 20th century, by diverting resources from high-productivity sectors to lower-productivity ones. This contractionary effect could lead to persistently lower global growth rates. In fact, the abolition of trade barriers within the EU and the international efforts towards lower trade barriers in the second half of the 20th century were a direct response to the economic and political impact of protectionism,^[25] which had played a key role in worsening and prolonging the Great Depression^[26] and had contributed to the formation of competing blocs in the run-up to the Second World War.^[27]

The second long-term shift driven by fragmentation might be the gradual transition from a US-dominated, global system to a more multipolar one, where multiple currencies compete for reserve status. For example, if the long-term implications of higher tariffs materialise, notably in the form of higher inflation, slower growth and higher US debt, this could undermine confidence in the US dollar’s dominant role in international trade and finance.^[28] Combined with a further disengagement from global geopolitical affairs and military alliances, this could, over time, undermine the “exorbitant privilege” enjoyed by the United States, resulting in higher interest rates domestically.^[29]

Moreover, as alternative payment systems gain traction, regional currencies may start to emerge as reserves within their respective blocs. This could be accompanied by the rise of competing payment systems, further fragmenting global financial flows and international trade. Such shifts would increase transaction costs and erode the capacity of countries to share risks on a global scale, making the world economy more fragmented and less efficient.

The central bank’s role in a fragmented world

So, as these tectonic shifts reshape the global economic landscape, central banks must adapt their approaches while remaining steadfast in their core mandates. The challenges posed by fragmentation require a delicate balance between confronting new realities and working to preserve the benefits of an integrated global economy. In order to navigate the present age of fragmentation, it is necessary to take action in four key areas.

First, central banks must focus on understanding and monitoring fragmentation. Traditional macroeconomic models often assume seamless global integration and may not fully capture the dynamics of a fragmenting world. Enhanced analytical frameworks that incorporate geopolitical factors and how businesses adjust to these risks will be essential for accurate forecasting and effective policy formulation. The Eurosystem is reflecting on these issues.

Second, monetary policy must adapt to the new nature of supply shocks generated by fragmentation. The effects of the greater frequency, size and more persistent nature of fragmentation-induced shocks and their incidence on prices require a careful calibration of our monetary responses. In this respect, our communication needs to acknowledge the uncertainty and trade-offs we face while giving a clear sense of how we will react depending on the incoming data. This can be done by making use of scenario analysis and providing clarity about our reaction function, as emphasised recently by President Lagarde.^[30]

Third, instead of building walls, we must forge unity. Even as political winds shift, central banks should strengthen international cooperation where possible. Through forums such as those provided by the BIS and the Financial Stability Board, we can keep open channels of cooperation that transcend borders. Our work on cross-border payments stands as proof of this commitment in line with the G20 Roadmap^[31]. The ECB is pioneering a cross-currency settlement service through TARGET Instant Payment Settlement (TIPS) – initially linking the euro, the Swedish krona and the Danish krone. We are exploring connections between TIPS and other fast-payment systems globally, both bilaterally and on the basis of a multilateral network such as the BIS’ Project Nexus.^[32]

And fourth, central banks must enhance their capacity to address financial stability risks arising from fragmentation. The potential for sudden stops in capital flows, payment disruptions and volatility in currency markets requires robust contingency planning and crisis management frameworks. Global financial interlinkages and spillovers highlight the importance of preserving and further reinforcing the global financial safety net so that we can swiftly and effectively address financial stress, which is more likely to emerge in a fragmenting world.^[33]

In fact, the lesson from the 1930s is that international coordination is key to avoiding protectionist snowball effects, where tit-for-tat trade barriers multiply as each country seeks to direct spending to merchandise produced at home rather than abroad.^[34] In order to avoid this, the G20 countries committed to preserving open trade could call an international trade conference to avoid beggar-thy-neighbour policies^[35] and instead agree on other measures, such as macroeconomic policies that can support the global economy in this period of uncertainty and contribute to reduce global imbalances.

Let me finally emphasise that the current situation also has important implications for the euro area. If the EU upholds its status as a reliable partner that defends trade openness, investor protection, the rule of law and central bank independence, the euro has the potential to play the role of a global public good. This requires a deep, trusted market for internationally accepted euro debt securities. That is why policy efforts to integrate and deepen European capital markets must go hand in hand with efforts to issue European safe assets.^[36]

Conclusion

Let me conclude.

As we stand at this crossroads of global fragmentation, we must confront an uncomfortable truth: we are drifting toward a fractured economic and financial landscape where trust is eroded and alliances are strained.

Central banks now face a double challenge: to be an anchor of stability in turbulent economic waters while reimagining their role in a world where multiple economic blocs are forming. The question is not whether we adapt, but how we mitigate the costs of fragmentation without sacrificing the potential of global integration.

Our greatest risk lies not in the shocks we anticipate, but in the alliances we neglect, the innovations we overlook and the common ground we fail to find. The future of global prosperity hinges on our ability to use fragmentation as a catalyst to reinvent the common good.

MIL OSI Economics –

April 29, 2025
MIL-OSI United Nations: Madagascar: Improving Infrastructure Resilience to Reduce Climate-Related Economic Losses
Source: UNISDR Disaster Risk Reduction

Madagascar: Improving Infrastructure Resilience to Reduce Climate-Related Economic Losses

(In collaboration with UNDRR and CDRI)

One of the world’s largest islands, located in the tropical south-west Indian Ocean, Madagascar needs new roads, schools, electricity networks, and more to lift large portions of its 30 million population out of poverty. But even as it builds this new infrastructure, its progress remains fragile. Tropical cyclones and other extreme hazard events can wipe out these development gains, and climate change multiplies that threat.

Four cyclones

in 2022 affected or displaced half a million people and flooded over 200 000 hectares of agricultural lands.

Nation-wide impact:

50,000 homes destroyed
10,000 classrooms wrecked
40 roads blocked

The damage

was equal to almost 5% of Madagascar’s GDP, increasing the poverty rate of affected households by 27%.

The challenge is significant. Madagascar is the world’s fourth largest island, and its relatively small population is spread out, much of it in rural hard-to-access areas. Most villages are isolated and they lack access to decent roads, drinking water or electricity, preventing sustainable development and poverty reduction too. Rapid population growth increases the pressure to build new infrastructure fast, but Madagascar must also find new ways to protect its transport networks, energy supplies, water supplies, and more from the growing threat of climate change.

Building resilience into infrastructure will bring significant benefits. Madagascar’s infrastructure currently suffers damage worth roughly USD 100 million each year. Cyclones account for 85 percent of this damage and are expected to increase with climate change.

With that in mind, Madagascar has become one of four countries – together with Bhutan, Chile, and Tonga – to pioneer the Global Methodology for Infrastructure Resilience Review. Developed by the UN Office for Disaster Risk Reduction (UNDRR) and the Coalition for Disaster Resilient Infrastructure (CDRI), the methodology helps countries to identify and prioritize strategies that will make their infrastructure more resilient through a five-step approach.
1

Stakeholder mapping
Key ministries, regulators and operators in infrastructure development

Cross-sector coordination mechanisms
Review of existing policies and regulations
Policies and regulations shaping infrastructure resilience

Integration of disaster risks in national plans and strategies
Identification of vulnerabilities (Stress Testing)
Data collection on hazards and vulnerabilities

Multi-hazard resilience testing of infrastructure systems
Principles for resilient infrastructure
Infrastructure resilience assessment using the UNDRR Resilience Principles

Identification of resilience-building interventions
Development of an Implementation plan
Results validation and prioritization

Implementation plan with assigned responsibilities
The roadmap for infrastructure resilience in Madagascar is a key strategic document, as it outlines a comprehensive action plan aimed at minimising disaster risks in the country,” he adds.

Advancing Infrastructure Resilience in Madagascar
Developing the plan

Developing the plan

The methodology follows five steps: Map institutional governance and identify key stakeholders; Review existing policies and regulations; Detect vulnerabilities through a stress-testing analysis; Assess current resilience through the Principles of Resilient Infrastructure; then Develop an implementation plan and produce a final report.

As part of that process, Madagascar hosted multiple workshops, that were accompanied by an assessment of institutions and regulations, analysis of sector-specific risks, and an evaluation of current practices too.

Countries need access to forward-looking information and for infrastructure systems, this means assessing the risks of interconnected infrastructure systems. The final “Roadmap for Infrastructure Resilience in Madagascar” identified nearly 50 measures to enhance the country’s infrastructure resilience.

The process integrates and complements work by Madagascar’s Cellule de Prévention et d’appui à la Gestion des Urgences (CPGU) to improve construction standards against cyclones, floods, and other hazards. It also brought in a wider range of stakeholders from the disaster risk, climate change, construction and planning, and investment sectors.

[embedded content]

“With this new way of looking by zooming out, we have more of an overall vision of everything that makes infrastructure vulnerable,” Randrianandrasana Lila Norolalaina, Head of Disaster Risk Reduction at the Ministry of Education, says.

Together, these stakeholders looked at six specific sectors – transport, energy, water, telecommunications, health and education – analyzing them against ten key hazards. Cyclones account for most of Madagascar’s recorded losses, but floods, rising sea levels, variations in rainfall patterns, and heatwaves also have an impact.

Cascading disasters were central to the analysis, since a failure in one infrastructure sector can spread to others. Electricity failure impacts communication, transportation, and water supply systems, for example. And pumping equipment loses power and is unable to keep floodwaters under control around the capital Antananarivo, then an electricity failure would lead to other disasters, for example. Understanding these interdependencies helps to prevent a chain of failures and thus much bigger crises.

The UNDRR stress testing tool simulated various scenarios and assessed the potential impact on different sectors. It helped decision-makers to understand their vulnerabilities and to analyse the possibilities for cascading disasters. Finally, it concluded that telecommunications and energy were the sectors most likely to trigger further failures, while wastewater management was the most vulnerable to disruptions from elsewhere.

Interdependencies of Functions and Cascading Effects

Energy

Energy

Discussed within the context of resilient infrastructure, energy is also vital for Madagascar’s human development. It is, however, in short supply throughout the country and this shortage prevents the country from industrialising its key sectors, especially farming. Some 80 percent of the workforce is involved with subsistence farming, for example, while failure to industrialise prevents the creation of higher paying jobs. The lack of energy also slows the modernisation of Madagascar’s young mining sector, a major contributor to GDP, through exports of nickel, cobalt, chromium, titanium, and heavy metals.

Madagascar aims to connect 70 percent of its population to electricity by 2030, from just 15 percent at present. For those who are connected, however, power cuts and voltage fluctuations are frequent, causing serious disruptions to daily life and economic development alike. The issue is often acute in rural areas, where just 5 percent of the population is connected.

Stress-testing analysis, Energy

Inadequate maintenance is part of the problem, but cyclones, heavy rains, landslides, and strong winds all lead to widespread interruptions and power outages. Two of six power stations are vulnerable to rising water levels, while earthquakes and cyber-attacks can also damage production. Droughts and fires threaten serious impacts to water supplies. They can therefore limit the production of electricity from hydropower, which accounts for 31 percent of Madagascar’s energy.

Resilience is a vital priority. Part of Madagascar’s resilience plan is to move away from imported fossil fuels towards renewables. Oil and coal, for example, account for 49 and 19 percent respectively of the island’s energy production, but they depend heavily on Madagascar’s transport, which is also vulnerable to storms. Madagascar wants renewables to account for 80 percent of its energy production by 2030, up from 33 percent at present.

Even before the review of infrastructure resilience, Madagascar had already begun to improve its energy infrastructure, through its 2015-2030 New Energy Policy (NPE). One key element of NPE is to integrate disaster risk management into the energy sector. In case of emergency, Madagascar has also developed a contingency plan to ensure continuity of essential services. With support from the World Bank, Madagascar is enhancing its energy sector management and improving service quality.

[embedded content]

Despite these initiatives, the infrastructure resilience review highlighted the continued need for Madagascar to strengthen the resilience of its energy infrastructure. While limited finances, insufficient institutional capacity, and lack of maintenance create significant barriers, which all compromise the energy sector’s ability to resist new shocks and crises, the Roadmap includes multiple opportunities to improve its resilience.

These opportunities mainly link to information and data. Stakeholders discussed the need to strengthen and update data for monitoring and evaluation, as well as to request information and disaster risk best practices from private operators in the sector. By mapping the state of energy infrastructure, including an assessment of vulnerability and resilience levels, Madagascar will be better placed to prioritise its interventions.

Following the Global Methodology for Infrastructure Resilience Review, therefore, Madagascar has already begun to work with other partners. The Global Risk Modelling Alliance (GRMA), for example, is working with Madagascar to improve their data through better hazard modelling.

“When we know the state of all our assets, then we will be better able to ensure proper maintenance, keep track of the hotspots, and manage all the gaps.”

Transport

Transport

Made up of four sub-sectors – air, sea, road, and rail – Madagascar’s transport illustrates the country’s challenges effectively too. Even without the natural hazards, Madagascar’s transport networks are limited. To the south, for example, one single trainline connects a region of roughly 100,000 people to the rest of the country. Also in the South, covering 500km by road can take three days.

With limited internal roads and railways, Madagascar uses its air network to connect different parts of the vast country, especially in the rainy season or when humanitarian aid is needed urgently. Its ports are also vital for the country’s economy, exporting vanilla and other agricultural products, together with minerals and seafood products.

Much of this infrastructure is, however, vulnerable to disasters, such as cyclones, cyber-attacks, fire hazards, and even pandemics. Cyclones, landslides, and flooding routinely damage roads and – in the wake of Cyclone Gamane in March 2024 – reconstruction of road infrastructure was set to cost USD 76 million.

International financial institutions, such as the World Bank and European Investment Bank, support Madagascar to recover from cyclone damage and to make their transport infrastructure more resilient. The Japan International Cooperation Agency (JICA) is supporting the USD 640 million expansion of Toamasina port, the gateway for about 75 percent of Madagascar’s international freight, while the African Development Bank (AfDB) is also considering rehabilitation of the port at Manakara.

Policies on rigorous maintenance, disaster planning, and construction or rehabilitation of new infrastructure, such as Ivato International Airport, will also help Madagascar to strengthen its infrastructure resilience.

Stress-testing analysis, Transportation

However, the Infrastructure Resilience Review brought new insights, enabling Madagascar to prioritise its interventions. Data analysis identified:

5 airports

vulnerable to flooding of up to 3.5 metres

9 of 57

ports vulnerable

16,292 km

roads at risk of landslides

Stakeholders discussed the need to improve regulations and institutions alike, including by incorporating resilience principles. More work is needed on climate adaptation, while Madagascar would also benefit from better engagement with financial institutions and the insurance sector too. Better coordination would improve national adaptation plans and coastal area management.

Stakeholders also discussed the need for more data analysis, preventive maintenance, capacity building, and emergency planning, as well as the need to involve the private sector and facilitate more competition.

One key topic was the importance of resilience norms, especially in the transport sector. How does Madagascar develop these and then ensure compliance? These norms – and stakeholder compliance – are essential in reducing the amount of substandard construction, a major boost for resilience.

“Raising awareness about the importance of norms is an important moment,” Ventsolalaina Ramilison, Head of Disaster Risk Reduction Department at CPGU / Madagascar said. “Now there is just the question of creating and strengthening a monitoring authority.”

Lessons for other countries

Lessons for other countries

The Infrastructure Resilience Review represents an important step forward by Madagascar towards infrastructure resilience. Stakeholders hope it will also benefit donors and provide key lessons for other countries.

“Given that donors tend to pay the costs of reconstruction following a disaster in Madagascar, they also benefit when Madagascar reduces the extent and cost of those disasters,” Ventsolalaina Ramilison, Head of Disaster Risk Reduction Department at CPGU / Madagascar says.

“When we can prevent storms from destroying our water supply infrastructure every year, then we can begin to build more sustainably,” she said. “That gives us hope, because we want to escape these endless cycles of recovery.”

Resilient infrastructure is important because it enables and protects sustainable development. All too often, ferocious storms have destroyed donor-financed infrastructure, which means – in other words – that insufficient resilience puts development progress at risk.
Download the full report:
Roadmap for Infrastructure Resilience in Madagascar

MIL OSI United Nations News –
April 29, 2025
MIL-OSI United Nations: Tonga: Building infrastructure resilience in an isolated, hazardous world
Source: UNISDR Disaster Risk Reduction

Tonga: Building infrastructure resilience in an isolated, hazardous world

(In collaboration with UNDRR and CDRI)

When an underwater volcano erupted about 65 kilometres north of Tonga’s main island, Tongatapu, in January 2022, it sent ash high into the atmosphere and triggered a tsunami that struck the archipelago nation with waves as high as 15 metres. While the waves killed four people directly in Tonga, the eruption and consequent tsunami smashed into residential and non-residential buildings alike, damaged other infrastructure such as submarine cables, and contaminated water supplies with ashfall.

Tonga

is one of the most disaster-prone countries in the world.

85,000 people

in Tonga affected by the 2022 volcano eruption.

The event also highlighted how Tonga must quickly build more resilience into its infrastructure and economy if it wants to improve the quality of life for its roughly 100,000 population.

The country is a lower-middle income nation, constrained by its geographic isolation, small market size, and high cost of basic services. A Pacific archipelago of 172 islands, whose nearest neighbours – Fiji and Samoa – are more than 700 kilometres away, Tonga is highly dependent on climate sensitive-sectors such as agriculture, fisheries, and tourism. Its economy is sensitive to external shocks.

Cyclones, tsunamis, and volcanoes cause serious damage every time they hit Tonga, and yet – in recent years – the Pacific nation has experienced more extreme weather events than usual. Cyclone Gita, a category 4 tropical cyclone which hit Tonga in February 2018, was one of the most powerful storms to hit Tonga in decades, killing two, destroying at least 171 homes, and damaging more than 1,100 others.

This immense vulnerability to multiple natural hazards – and the dangers of cascading impacts – led Tonga to become one of four countries – together with Bhutan, Chile, and Madagascar – pioneering the Global Methodology for Infrastructure Resilience Review. Developed by the UN Office for Disaster Risk Reduction (UNDRR) and the Coalition for Disaster Resilient Infrastructure (CDRI), the methodology helps countries to identify and prioritise the strategies that will build their infrastructure resilience through a five-step approach.

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1

Stakeholder mapping
Key ministries, regulators and operators in infrastructure development

Cross-sector coordination mechanisms
Review of existing policies and regulations
Policies and regulations shaping infrastructure resilience

Integration of disaster risks in national plans and strategies
Identification of vulnerabilities (Stress Testing)
Data collection on hazards and vulnerabilities

Multi-hazard resilience testing of infrastructure systems
Principles for resilient infrastructure
Infrastructure resilience assessment using the UNDRR Resilience Principles

Identification of resilience-building interventions
Development of an Implementation plan
Results validation and prioritization

Implementation plan with assigned responsibilities
“The infrastructure resilience review process is already helping us to do that,” he said.

Advancing Infrastructure Resilience in Tonga
The process

The process

In 2021, Tonga enacted the Disaster Risk Management (DRM) 2021 Act, replacing the Emergency Management Act 2007, signaling a new ambition to manage risk instead of reacting to disaster.

After the 2022 volcano eruption, it also connected quickly with international partners. With World Bank support, it upgraded its ports, roads, and an airport, making them more resilient to storm surges, floods, and high winds. The Asian Development Bank has also helped with grants to help the country recover from disasters and health emergencies, including the COVID-19 pandemic.

The infrastructure resilience assessment approach in the Global Methodology, provided Tonga with the opportunity to take a holistic look at their infrastructure and risk, identify the gaps, and then fill them.

Stress-testing of Critical Infrastructure against Identified Hazard, Tonga

In the first phase, a technical working group was set up with representatives from 21 departments and agencies across six ministries. Supported by this working group, the review process began with a kick-off meeting that included key stakeholders for infrastructure development, disaster risk reduction, and sectoral operations. Next, in phase two, it reviewed existing policies and regulations, assessing the extent to which they address disaster risks and support infrastructure resilience.

In the third phase, stakeholders conducted stress tests and gap analysis on ten critical infrastructure functions against a range of hazards, including cyclones, droughts, underground water / seawater intrusion, tsunamis, volcanic eruptions, non-communicable diseases, land degradation and erosion, floods, sea level rises, and cybersecurity breaches. By identifying these vulnerabilities, interdependences, and cascading risks, the participants were able to seriously consider the economic impacts and interdependences of different hazards throughout.

Fourth, Tonga’s current resilient infrastructure practices were assessed against the UNDRR Principles for Resilient Infrastructure. These six principles set out the key conditions for sustainable infrastructure resilience. They support the Sendai Framework for Disaster Risk Reduction and Sustainable Development Goals, as well as the G20 Principles for Investing in Quality Infrastructure.

Finally, stakeholders drafted an implementation plan, consolidating the findings and providing a road map for enhancing infrastructure resilience.

“By prioritising resilience, the country can support sustainable economic growth, adapt to climate change, and protect communities, while minimising economic and human losses.”

Water sector

Water sector

One of the sectors examined was the water sector, including a deep dive analysis. Water is everywhere in a small island development state (SIDS) like Tonga, of course, but securing a stable supply remains difficult. Water in Tonga comes from ground water and rainwater, which are both vulnerable to impacts from climate change.

Rising sea-levels mean that many assets are at risk of flooding, while soil erosion is also a threat. When sea levels rise, salt water can enter some freshwater supplies, reducing the available water for drinking.

Funding the necessary upgrades, however, is a challenge. The Tonga Water Board (TWB) operates without subsidies, making capital investment difficult.

Meanwhile, the lack of a centralised infrastructure database complicates the assessment and management of existing resources. Multiple institutions manage water resources across the archipelago’s 45 or so inhabited islands, doing so with varying levels of expertise. While integrated planning and coordination should be essential for efficiency, the system is fragmented. Integrated planning and management are urgently needed to ensure resilience in the water sector. Equally as importantly, there’s a need for more data and information, and for a better understanding of how to use the already available data, which does not capture all boreholes and rainwater harvesting.

[embedded content]

Challenges are even greater on the outer islands. Most villages lack a formalised tariff system, complicating the collection of revenue for repairs and maintenance. Composed of local residents, Village Water Committees (VWCs) play a crucial role, but they often lack financial and other supporting skills. Without structured regulations and trained personnel, infrastructure upkeep is inconsistent.

“But at the same time, it takes four or five hours by boat to reach some of these communities,” he said. “It is not an easy job.” The support system for water infrastructure needs to be planned, designed, and monitored more effectively to become more resilient to hazards, which is an area of need for VWC.

Finally, the water pumping stations are dependent on electricity. This means that if a cyclone damages the power lines and impacts electricity supply, then water supply would also be affected. The disaster responses are complicated by limited standard operating procedures (SOPs) as cyclones, volcanoes, and tsunamis all affect the water infrastructure in different ways. Take a look at how some of the most recent events have affected Tonga’s water infrastructure:

Hazard-related disruptions in Tonga’s water sector

TROPICAL CYCLONES:

Cyclone Gita (2018) damaged water distribution systems and rainwater tanks, while other cyclones have led to extensive system failures.

VOLCANIC ERUPTIONS AND ASHFALL:

The 2022 eruption of Hunga Tonga-Hunga Ha’apai severely impacted water punps and contaminated rainwater tanks, leading to supply disruptions.

DROUGHTS:

Prolonged droughts in 2023 have affected rainwater collection systems, exacerbating water shortages.

TSUNAMIS:

The 2022 tsunami contamined groundwater sources in southern islands and destroyed coastal water infrastructure.

Several resilience measures do exist. Desalination units provide emergency water, even if their maintenance or repairs sometimes fall on untrained community members, causing delays and potential safety issues. Overall, however, these are uneven and insufficient.

Some development support has been provided, but the projects are also unevenly distributed. They tend to focus mostly on the main island, leaving outer islands underserved.

From the Infrastructure Resilience Review, several recommendations emerged:

Build Village Water Committee capacity by developing management manuals, training, and emergency water plans for climate and disaster events.

Establish standard procedures for Village Water Committees to capture and share water data, linking it into a centralised system. Procure and distribute the necessary hardware, then train the VWCs in its use.

Set up processes to coordinate donor projects across the water sector.

Review the complete water sector for exposure to hazards, including its dependencies on other sectors such as transport, ICT and energy.

Find ways to improve the management of both rainwater and groundwater.

Improve water security on the outer islands by increasing water storage volumes, testing new solutions such as hydro panels and mobile desalination units.

Transport

Transport

The Infrastructure Resilience Review also looked at transport, given the importance and vulnerabilities of Tonga’s ports, airports, and roads.

On the one hand, Tonga’s geographic isolation makes it highly dependent on its ports and airports for imports of food, fuel, and spare parts. In 2000, the last available energy balance showed that 75 percent of the country’s energy depends on imported petroleum products. Over 98 percent of Tonga’s grid-supplied electricity is generated using imported diesel.

On the other hand, those ports and airports are highly vulnerable to disruption of the other critical infrastructure functions, including transport. The ports and airports both depend on Tonga’s roads, for example, to connect them with the rest of the country.

Multi Hazards Disaster Risk Assessment, ARUP 2021

However, while Tonga’s climate is already tropical, climate change is expected to bring heavier and more frequent rainfall, damaging roads in the low-lying areas. Inadequate drainage will compound this damage, disrupting transport and mobility to the ports and airports.

In turn, this could also disrupt Tonga’s electricity, which relies heavily on diesel imports, as well as the delivery of clean water to remote areas or even – in case of emergencies – access to evacuation centres.

The Roadmap for Infrastructure Resilience has multiple recommendations for improving road transport resilience, including the following:

Improve data on infrastructure quality to understand better which rural and urban roads are exposed to flooding.

Produce geohazard maps to enable monitoring of infrastructure resilience and vulnerability.

Develop mitigation measures based on assessments of the road quality.

Integrate climate safety factors into road design.

Additionally, the Roadmap for Infrastructure Resilience in the Kingdom of Tonga makes specific priority recommendations for individual sectors, including the development of a national resilient critical infrastructure strategy, the establishment of a critical infrastructure working group, and the establishment of a central disaster data centre.

“The infrastructure resilience review reminds us that we are not passive actors, but that to a much greater extent we are masters of our own destiny,” said Sione Pulotu ‘Akau’ola, CEO for Ministry of MEIDECC.

“In the long run, building resilience into our infrastructure will save us lives, destruction, and economic damage,” he said.
Download the full report:
Roadmap for Infrastructure Resilience in the Kingdom of Tonga

MIL OSI United Nations News –
April 29, 2025

MIL-OSI Economics: Open Market Operation (OMO) – Purchase of Government of India Securities held on April 29, 2025: Cut-Offs

Source: Reserve Bank of India

Security	7.04% GS 2029	6.10% GS 2031	7.26% GS 2032	6.19% GS 2034	8.33% GS 2036
Total amount notified	Aggregate amount of ₹20,000 crore (no security-wise notified amount)
Total amount (face value) accepted by RBI (₹ in crore)	1,605	9,869	2,656	1,610	4,260
Cut off yield (%)	6.0975	6.2238	6.2570	6.3476	6.5005
Cut off price (₹)	103.36	99.36	105.80	98.89	114.30
Detailed results will be issued shortly.

Ajit Prasad
Deputy General Manager
(Communications)

Press Release: 2025-2026/202

MIL OSI Economics –

April 29, 2025

MIL-OSI Banking: The ASEAN Senior Officials’ Meeting convenes in Kuala Lumpur today

Source: ASEAN

Four months into Malaysia’s ASEAN Chairmanship, the ASEAN Senior Officials’ Meeting convened today in Kuala Lumpur, Malaysia, with the participation of all ASEAN Member States, the ASEAN Secretariat and Timor-Leste as Observer. The meeting discussed preparations for the upcoming 46th ASEAN Summit and Related Summits as well as other matters, including advancing Malaysia’s Chairmanship priorities and deliverables, ASEAN Community-building initiatives, and external relations, aligning with the theme for this year, “Inclusivity and Sustainability”.

The post The ASEAN Senior Officials’ Meeting convenes in Kuala Lumpur today appeared first on ASEAN Main Portal.

MIL OSI Global Banks –

April 29, 2025
MIL-OSI United Kingdom: New appointments to Financial Conduct Authority board announced
Source: United Kingdom – Executive Government & Departments

News story

New appointments to Financial Conduct Authority board announced

Chancellor announces the appointment of four new Non-Executive Directors at the Financial Conduct Authority (FCA).
The Chancellor of the Exchequer Rachel Reeves has today confirmed that Julia Black, Anita Kimber, John Ball and Stéphane Malrait have been appointed as Non–Executive Directors to the Board of the Financial Conduct Authority (FCA). The Chancellor also confirms a one-year extension of Richard Lloyd’s second term as a Non-Executive Director on the FCA Board.

Julia Black and Anita Kimber will commence their terms on 12 May 2025, John Ball on 27 May 2025, whilst Stéphane Malrait will join later in the year on 20 October 2025. They will each serve an initial three-year term. Richard Lloyd’s second term has been extended and will now conclude on 31 March 2026.

Julia Black is a former External Member of the Prudential Regulation Committee. Julia is a highly accomplished academic in the field of law and financial regulation and has advised policy makers, consumer bodies, and regulators on issues of regulatory strategy and design in the UK and internationally.

Anita Kimber is a former Partner at EY who has also led large practices at PwC and IBM. Anita is experienced in leading transformation programmes across technology, data and analytics combined with customer insight and user experience focused teams. Anita’s experience is closely aligned with regulatory compliance for banks and other financial services institutions, including a secondment and a permanent appointment at Nationwide Building Society.

John Ball is a former Global MD, Pensions Practice for Willis Towers Watson where he enjoyed a near 40 year career. He has extensive change management experience and broader board experience across several WTW subsidiary boards and committees. The FCA Board will benefit from John’s deep pensions expertise.

Stéphane Malrait is a former Managing Director and Global Head of market structure and innovation for Financial Markets at ING Bank. Stéphane has operated in large, complex organisations internationally, including in the US, France, and the UK. He will bring experience of governance across different entities including non-executive board experience with industry associations and fintech companies.

Richard Lloyd is a distinguished member of the Financial Conduct Authority (FCA) Board, bringing a wealth of experience from his extensive career in consumer rights and public policy. He previously held significant roles, including serving as the Executive Director of Which?, where he championed consumer interests and advocated for fairer markets. Notably, Richard served effectively as the interim Chair of the FCA Board from June 2022 until February 2023, demonstrating strong leadership and a steadfast commitment to the organisation’s objectives.

Chancellor of the Exchequer, Rachel Reeves, said:

The FCA have been crucial in supporting the government’s efforts to reform regulation in order to better support growth and I am pleased to announce the appointments of Julia Black, Anita Kimber, John Ball and Stéphane Malrait to the FCA Board and the extension of Richard Lloyd for an additional year.

All five individuals bring extensive financial services experience to the Board and will help the FCA go further and faster to deliver on this government’s Plan for Change.

Chair of the FCA Board Ashely Alder, said:

I’m delighted to welcome Julia, Anita, John and Stéphane to the FCA board. Together, they bring a wealth of experience and insight across the financial services sector. I look forward to working with them as we deliver our ambitious new 5-year strategy.

I’d also like to congratulate Richard Lloyd on the extension of his second term, which ensures we continue to benefit from his invaluable counsel in the months ahead.

About the Financial Conduct Authority

The Financial Conduct Authority (FCA) is the conduct regulator for the UK’s financial services firms and markets. It is responsible for the conduct of around 42,000 businesses and sets the specific prudential standards for roughly 17,000 firms.

It has an overarching strategic objective of ensuring the relevant markets function well. To support this, it has three operational objectives: to secure an appropriate degree of protection for consumers; to protect and enhance the integrity of the UK financial system; and to promote effective competition in the interests of consumers. Its secondary objective is to facilitate the international competitiveness of the UK economy, and its growth in the medium to long-term.

About the appointment process

Julia Black, Anita Kimber, John Ball and Stéphane Malrait have been appointed by the Chancellor following a fair and open recruitment process run by HM Treasury. All appointments are subject to vetting and security clearances currently in progress.

The Treasury is committed to appointing a diverse range of people to public appointments, including at the Financial Conduct Authority. The Treasury continues to take active steps to attract the broadest range of suitable applicants for posts.

Appointments to the FCA Board are regulated by the Office of the Commissioner for Public Appointments. Julia Black, Anita Kimber, John Ball and Stéphane Malrait have not engaged in any political activity in the last five years.

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Published 29 April 2025
MIL OSI United Kingdom –
April 29, 2025
MIL-OSI: The recording of Šiaulių Bankas Investor Conference Webinar of introducing the financial results for Q1 2025

Source: GlobeNewswire (MIL-OSI)

During the Investor Conference Webinar by Vytautas Sinius, CEO, Tomas Varenbergas, Head of Investment Management Division, Chief Economist Indrė Genytė–Pikčienė and Tautvydas Mėdžius, Strategy Partner, introduced the Bank’s financial results for Q1 2025 and recent developments and answered the participant questions afterwards.

The recording of it can be found on Nasdaq youtube channel there.

Presentation and the recording of webinar are also posted on the Bank’s website https://sb.lt/en/investors

Šiaulių bankas thanks all participants.

If you would like to receive Šiaulių Bankas news for investors directly to your inbox, subscribe to our newsletter.

Additional information:

Tomas Varenbergas

Head of Investment Management Division

tomas.varenbergas@sb.lt , +370 610 44447

The MIL Network –

April 29, 2025
MIL-OSI Europe: ECB Consumer Expectations Survey results – March 2025
Source: European Central Bank

29 April 2025

Compared with February 2025:
- median consumer perceptions of inflation over the previous 12 months remained unchanged, as did expectations for inflation five years ahead (reported for the first time this month), while median inflation expectations for both the next 12 months and three years ahead increased;
- expectations for nominal income growth over the next 12 months remained unchanged, while expectations for spending growth over the next 12 months decreased;
- expectations for economic growth over the next 12 months were unchanged (remaining somewhat negative), while the expected unemployment rate in 12 months’ time decreased;
- expectations for growth in the price of homes over the next 12 months increased, while expectations for mortgage interest rates 12 months ahead remained unchanged.
Inflation

The median rate of perceived inflation over the previous 12 months remained unchanged at 3.1% in March. This is its lowest level since September 2021. Median expectations for inflation over the next 12 months increased by 0.3 percentage points to 2.9%, the highest level since April 2024, while expectations for three years ahead edged up by 0.1 percentage points to 2.5%, the highest level since March 2024. Expectations for inflation five years ahead, which are being reported for the first time this month, were unchanged for the fourth consecutive month at 2.1%. For more information on this new measure of inflation expectations, please see the box entitled “Consumers’ long-term inflation expectations: an overview” in the Economic Bulletin, Issue 3, ECB, 2025. Inflation expectations at the one-year, three-year and five-year horizons thus remained below the perceived past inflation rate. Uncertainty about inflation expectations over the next 12 months remained unchanged in March at its lowest level since January 2022. While the broad evolution of inflation perceptions and expectations remained relatively closely aligned across income groups, over the previous year and a half inflation perceptions and short-horizon expectations for lower income quintiles were, on average, slightly above those for higher income quintiles. Younger respondents (aged 18-34) continued to report lower inflation perceptions and expectations than older respondents (those aged 35-54 and 55-70), albeit to a lesser degree than in previous years. (Inflation results)

Income and consumption

Consumers’ nominal income growth expectations over the next 12 months remained unchanged at 1.0%. Perceived nominal spending growth over the previous 12 months increased to 5.0%, from 4.9% in February. Expected nominal spending growth over the next 12 months decreased to 3.4% in March, from 3.5% in February and 3.6% in January. This decrease was observed across most income groups. (Income and consumption results)

Economic growth and labour market

Economic growth expectations for the next 12 months were stable in March, standing at -1.2%. Expectations for the unemployment rate 12 months ahead decreased to 10.4%, from 10.5% in February. Consumers continued to expect the future unemployment rate to be only slightly higher than the perceived current unemployment rate (10.0%), implying a broadly stable labour market. Expectations for both economic growth and the unemployment rate remained broadly stable over the previous four months, fluctuating within a narrow range. (Economic growth and labour market results)

Housing and credit access

Consumers expected the price of their home to increase by 3.1% over the next 12 months, which was slightly higher than in February. Households in the lowest income quintile continued to expect higher growth in house prices than those in the highest income quintile (3.3% and 2.8% respectively), although the difference between them narrowed in recent months. Expectations for mortgage interest rates 12 months ahead remained unchanged from February at 4.4%. As in previous months, the lowest income households expected the highest mortgage interest rates 12 months ahead (5.1%), while the highest income households expected the lowest rates (4.0%). The net percentage of households reporting a tightening (relative to those reporting an easing) in access to credit over the previous 12 months increased, while the net percentage of those expecting a tightening over the next 12 months declined. (Housing and credit access results)

The microdata underlying the aggregate results are available on the Consumer Expectations Survey (CES) web page in the Data and methodological information section.

The release of the Consumer Expectations Survey (CES) results for April is scheduled for 28 May 2025.

For media queries, please contact: Benoit Deeg, tel.: +49 172 1683704.

Notes
- Unless otherwise indicated, the statistics presented in this press release refer to the 2% winsorised mean. For further details, see ECB Consumer Expectations Survey – Guide to the computation of aggregate statistics.
- The CES is a monthly online survey of, currently, around 19,000 adult consumers (i.e. aged 18 or over) from 11 euro area countries: Belgium, Germany, Ireland, Greece, Spain, France, Italy, the Netherlands, Austria, Portugal and Finland. The main aggregate results of the CES are published on the ECB’s website every month. The results are used for policy analysis and complement other data sources used by the ECB.
- Further information about the survey and the data collected is available on the CES web page. Detailed information can also be found in the following two publications: Bańkowska, K. et al., “ECB Consumer Expectations Survey: an overview and first evaluation”, Occasional Paper Series, No 287, ECB, Frankfurt am Main, December 2021; and Georgarakos, D. and Kenny, G., “Household spending and fiscal support during the COVID-19 pandemic: Insights from a new consumer survey”, Journal of Monetary Economics, Vol. 129, Supplement, July 2022, pp. S1-S14.
- The survey results do not represent the views of the ECB’s decision-making bodies or staff.
MIL OSI Europe News –
April 29, 2025
MIL-OSI Europe: Monetary developments in the euro area: March 2025
Source: European Central Bank

29 April 2025

Components of the broad monetary aggregate M3

The annual growth rate of the broad monetary aggregate M3 decreased to 3.6% in March 2025 from 3.9% in February, averaging 3.7% in the three months up to March. The components of M3 showed the following developments. The annual growth rate of the narrower aggregate M1, which comprises currency in circulation and overnight deposits, increased to 3.8% in March from 3.4% in February. The annual growth rate of short-term deposits other than overnight deposits (M2-M1) decreased to 1.5% in March from 2.0% in February. The annual growth rate of marketable instruments (M3-M2) decreased to 11.3% in March from 18.0% in February.

Chart 1

Monetary aggregates

(annual growth rates)

Data for monetary aggregates

Looking at the components’ contributions to the annual growth rate of M3, the narrower aggregate M1 contributed 2.4 percentage points (up from 2.2 percentage points in February), short-term deposits other than overnight deposits (M2-M1) contributed 0.4 percentage points (down from 0.6 percentage points) and marketable instruments (M3-M2) contributed 0.7 percentage points (down from 1.1 percentage points).

Among the holding sectors of deposits in M3, the annual growth rate of deposits placed by households stood at 3.5% in March, compared with 3.4% in February, while the annual growth rate of deposits placed by non-financial corporations decreased to 2.3% in March from 3.0% in February. Finally, the annual growth rate of deposits placed by investment funds other than money market funds increased to 16.2% in March from 8.5% in February.

Counterparts of the broad monetary aggregate M3

The annual growth rate of M3 in March 2025, as a reflection of changes in the items on the monetary financial institution (MFI) consolidated balance sheet other than M3 (counterparts of M3), can be broken down as follows: net external assets contributed 2.7 percentage points (down from 3.1 percentage points in February), claims on the private sector contributed 2.1 percentage points (down from 2.2 percentage points), claims on general government contributed 0.2 percentage points (as in the previous month), longer-term liabilities contributed -1.3 percentage points (up from -1.5 percentage points), and the remaining counterparts of M3 contributed -0.1 percentage points (as in the previous month).

Chart 2

Contribution of the M3 counterparts to the annual growth rate of M3

(percentage points)

Data for contribution of the M3 counterparts to the annual growth rate of M3

Claims on euro area residents

The annual growth rate of total claims on euro area residents stood at 1.7% in March 2025, unchanged from the previous month. The annual growth rate of claims on general government stood at 0.4% in March, unchanged from the previous month, while the annual growth rate of claims on the private sector stood at 2.2% in March, compared with 2.3% in February.

The annual growth rate of adjusted loans to the private sector (i.e. adjusted for loan transfers and notional cash pooling) increased to 2.6% in March from 2.4% in February. Among the borrowing sectors, the annual growth rate of adjusted loans to households increased to 1.7% in March from 1.5% in February, while the annual growth rate of adjusted loans to non-financial corporations increased to 2.3% in March from 2.1% in February.

Chart 3

Adjusted loans to the private sector

(annual growth rates)

Data for adjusted loans to the private sector

Notes:
- Data in this press release are adjusted for seasonal and end-of-month calendar effects, unless stated otherwise.
- “Private sector” refers to euro area non-MFIs excluding general government.
- Hyperlinks lead to data that may change with subsequent releases as a result of revisions. Figures shown in annex tables are a snapshot of the data as at the time of the current release.
MIL OSI Europe News –
April 29, 2025
MIL-OSI United Kingdom: Treat for car lovers as Supercar Saturday roars into town

Source: Northern Ireland – City of Derry

Treat for car lovers as Supercar Saturday roars into town

29 April 2025

Car enthusiasts across the city and district are in for a treat as the Mayor’s popular Supercar Saturday roars into Guildhall Square and Harbour Square on Saturday 24^th May from 12-5pm.

Local car enthusiasts Gary and Stephen McCaul will showcase approximately 35 luxury vehicles including Lamborghini, Ferrari, Porsche, McLaren and Maserati for public viewing.

Popular local entertainer Micky Doherty will lead this family-friendly event which offers children and big kids the chance to get up close with one of Ireland’s finest collections of supercars. Adding to the festive atmosphere, DJ Lui and DJ Richie Rich will keep the music flowing throughout the day. A mobile gaming truck will provide additional entertainment for younger attendees, while local food vendors will be on site serving delicious refreshments.

The Mayor of Derry City and Strabane District Council, Cllr Lilian Seenoi Barr, said she was delighted to see this well-supported event return to the city. Supercar Saturday will help to raise funds for The Bud Club, the Mayor’s chosen charity for her year in office.

“I’m really looking forward to hosting Supercar Saturday. This event has become a highlight in our community calendar, and for good reason. The collection of Lamborghinis, Ferraris, and other luxury vehicles that Gary and Stephen have arranged is truly world-class. I’ve had the privilege of previewing some of these fantastic vehicles, and they are simply breathtaking.

“What makes this day so special is that it allows car enthusiasts to explore the spectacular vehicles they have previously only dreamt about. I’m particularly proud that this event will raise funds for The Bud Club, allowing our community’s passion for incredible cars to directly benefit a life-changing organisation for young people with additional needs.”

Supercar Saturday is part of the Mayor’s One Big Weekend, One Big Cause – Revved Up and Ready to Rock for Bud Club’ extravaganza which will take place on the Bank Holiday weekend of May 24th and 25^th and features three incredible events designed to appeal to all ages and interests.

The fun will begin with Supercar Saturday, followed by a night of music and entertainment with ‘Derry Rocks for Bud Club’ in the Guildhall. This event will feature The Mindbenders with the Ultimate Yacht Rock Show, along with funnyman Black Paddy and musician Ritchie Remo. The weekend will be brought to an epic conclusion with ‘Feel the Beat’ a night of high-energy and infectious Afrobeats at St Columb’s Hall. All three events will raise funds for the Mayor’s chosen charity, The Bud Club, a life-changing organisation for young people with additional needs.

For more information and to purchase tickets to the ‘Derry Rocks for Bud Club’ and Afrobeats night go to www.derrystrabane.com/OneWeekend. You can also keep up to date with everything that is happening on What’s On Derry Strabane and Council’s social channels.

MIL OSI United Kingdom –

April 29, 2025
MIL-OSI United Kingdom: LFC Premier League Victory Parade Confirmed

Source: City of Liverpool

Last updated:29 April 2025

The Leader of Liverpool City Council, Councillor Liam Robinson, has invited Liverpool Football Club to parade the city’s streets to officially celebrate securing their 20^th English league title.

After Arne Slot’s team triumphed against Tottenham Hotspur yesterday, the City Council has hit the green light on initiating its complex parade protocol, with plans for the Premier League trophy parade to take place on Bank Holiday Monday, 26 May, from 2.30pm.

The major logistical challenges in arranging a parade of this scale, which is expected to be witnessed by hundreds of thousands of people, means months of planning has already been taking place behind the scenes with stakeholders across the city. Given the magnitude of the event, organisers are keen for the date to be publicised in advance so residents and businesses in the city can prepare.

The victory parade route will start at Allerton Maze and will travel north bound on Queens Drive towards the Fiveways roundabout and Rocket flyover. From there it will journey along:

• Queens Drive

• Mill Bank

• West Derby Road

• Islington

• Leeds Street

• The Strand

• Route finishes at Blundell Street

It is expected the 15km-long parade will last anywhere between 3 to 5 hours, but this is subject to change.

As in 2019 and in 2022, the key advice to supporters to line the entire route, plan travel in advance and supporters are reminded that bringing their own pyrotechnics/flares is prohibited in order to protect the safety of all in attendance.

Those planning to line the route and cheer the team on should expect the city to be extremely busy, not only on the Monday, but also in the days beforehand as Liverpool is hosting the major music event, Radio 1 Big Weekend. Cunard’s Queen Anne will also be sailing into the city on Monday 26 May, which is expected to also attract crowds.

More information and advice will be issued by the City Council and partner agencies (Liverpool Football Club, Merseyside Police and Merseytravel) in the run up to the date.

The full costs of the parade will be met by Liverpool Football Club.

The parade is being organised by Liverpool City Council’s award-winning Culture Liverpool team, which has been praised for its work on the previous victory parades, and is also responsible for bringing other major events to the city, such as Eurovision 2023 and this year’s Radio 1 Big Weekend.

Leader of Liverpool City Council, Councillor Liam Robinson, said:

“We’re delighted to officially invite Liverpool Football Club to parade around the city on the 26 May. A Liverpool victory parade is more than football – it’s a celebration of our city’s pride, passion and community spirit.

“It’s going to be a bumper weekend in Liverpool, with Radio 1 welcoming more than 100,000 people to Sefton Park, the final Premier League match on the Sunday, Cunard’s Queen Anne sailing into the city on Monday, on the same day as the parade – any other city may shy away from back-to-back high-profile events, but as one of the world leader’s when it comes to staging major, successful and safe outdoor activities, Liverpool is set to shine once again under the global spotlight.

“A huge amount of work goes on behind the scenes in preparation for an event of this size and scale, and there has already been months of careful planning taking place as the Team Liverpool approach – which we saw work so well throughout Eurovision – comes to the fore again.

“It’s set to be an unforgettable Bank Holiday Weekend as we give the team the celebration they deserve.”

Chief Inspector Chris Barnes, the Silver Commander for the event, said:

“We have been working with Liverpool City Council, who are organising the event, and will be supporting them with the running and policing of the Victory Parade Monday, 26 May, to ensure the event goes ahead safely and disruption to regular road users and people living and visiting the city is minimal.

“Officers will be providing a reassuring presence along the route to ensure that that day is not only one to remember, but also an enjoyable and safe event for all those attending the parade.

“Rolling road closures will be put in place to accommodate the parade and although we will work with Liverpool City Council to keep disruption to a minimum, some traffic disruption is inevitable and we would ask motorists to be patient, or avoid the area of parade route where possible.

“If you have plans already for Monday (26th May) or are going to be driving in and out of the area, I would ask you to familiarise yourself with the route so you can fully prepare, make alternative travel arrangements in advance, or use available public transport wherever possible.

“We would like to take this opportunity to congratulate Liverpool Football Club on their success. The parade on Monday, 26 May, will be a fantastic event for the players, the club, the city, and all the fans who will turn out to cheer their team on through the streets of Liverpool.”

MIL OSI United Kingdom –

April 29, 2025
MIL-OSI New Zealand: VANUATU: Families find climate-smart ways to grow crops

Source: Save The Children

Tropical Cyclone Lola was one of the most powerful off-season storms to strike the Pacific when it made landfall in October 2023 with wind speeds of up to 215 km/h, destroying homes, schools and plantations, claiming the lives of at least four people [2] and affecting about 91,000 people [1].

Recovery efforts were made significantly more challenging when Vanuatu’s capital Port Vila was then hit by a 7.3 magnitude earthquake in December last year, claiming 14 lives and destroying critical infrastructure.

Madleen, 11, said when the cyclone hit, her family’s crops were destroyed, leaving them short of food.

“It destroyed the food crops. When we came outside, we saw the crops were destroyed. The banana tree was just bearing fruit and it was destroyed. And we didn’t have enough food. We were eating rice, but we were almost running short. We were not eating well, we ate just enough. I felt bad.”

After the cyclone, a shortage of nutritious food put children at risk of hunger as well as diseases like diarrhea, with typically an increase in the number of children hospitalised for diarrhea following cyclones, Save the Children said.

Vanuatu is already one of the most climate disaster-prone countries in the world, and scientists say tropical cyclones will become more extreme as the climate crisis worsens. This will disproportionately impact children due to food shortages, disruption to education and psychosocial trauma associated with experiencing disasters.

Save the Children, alongside Vanuatu’s Ministry of Agriculture, Livestock, Forestry, Fisheries, and Biosecurity (MALFFB) and local partners, is supporting Madleen and her family through the Tropical Cyclone Lola Recovery Programme, which is helping improve food security and resilience in communities impacted by the cyclone.

As a part of the Recovery Programme, over 1,100 households have received climate-resistant [3] seeds from a seedbank. These seeds, for growing watermelon, papaya, Chinese cabbage, tomato, capsicum and cucumber, are proven to perform in Vanuatu’s changing climate, with tolerance to high rainfall, drought, pests and disease. Farmers are encouraged to preserve the seeds from crops and sell them back to the seed bank.

The programme is also training communities in other climate-smart agricultural techniques such as growing smaller fruit trees that are robust enough to withstand strong cyclone winds.

Save the Children has also built a collapsible nursery for plants in Madleen’s community that can be taken down when a cyclone is predicted, so saplings and trees can be stored, protected and replanted after it passes.

Save the Children Vanuatu Country Director, Polly Banks, said:

“In just 18 months, people in Vanuatu have been deeply shaken by a devastating cyclone and a powerful earthquake.

“Children have borne the brunt of this, with food taken off their plates, crops destroyed, homes and schools damaged and diseases on the rise. As the climate crisis accelerates, we must work with communities to strengthen their resilience, so children and their families are better equipped to face whatever comes next.

“We’re working in partnership with the Government of Vanuatu and local partners to help communities build the skills and resources they need to support themselves when future cyclones and disasters strike.”

Save the Children has been working in in Vanuatu for more than 40 years to make sure children are learning, protected from harm, and grow up healthy and strong.

MIL OSI New Zealand News –

April 29, 2025
MIL-OSI Europe: Piero Cipollone: Navigating a fractured horizon: risks and policy options in a fragmenting world

Source: European Central Bank

Speech by Piero Cipollone, Member of the Executive Board of the ECB, at the conference on “Policy challenges in a fragmenting world: Global trade, exchange rates, and capital flow” organised by the Bank for International Settlements, the Bank of England, the ECB and the International Monetary Fund

Frankfurt am Main, 29 April 2025

I’m honoured to welcome you to this conference, jointly organised by the Bank for International Settlements (BIS), the Bank of England, the European Central Bank (ECB) and the International Monetary Fund (IMF).^[1]

Today, we come together to discuss the urgent challenges posed by global fragmentation – a growing risk to our interconnected world. Earlier this month, the President of the United States announced tariff hikes, sending shockwaves through the global economy – a stark reminder that the fractures we face are no longer hypothetical, but real.

This announcement is but the latest chapter in a series of four major shocks that have been reshaping our world in recent years.

First, since 2018 the intensifying power struggle between the United States and China has led to tit-for-tat tariffs affecting nearly two-thirds of the trade between these two economic giants. Second, starting in 2020, the pandemic caused unprecedented disruptions to supply chains, which prompted a re-evaluation of the balance between global integration and resilience. Third, in 2022 Russia’s unjustified invasion of Ukraine not only triggered an energy crisis but also deepened a geopolitical divide that continues to have worldwide repercussions. And fourth, we are now facing the rising risk of economic fragmentation within the western bloc itself, as new trade barriers threaten long-standing international partnerships.

The data paint a sobering picture. Geopolitical risk levels have surged to 50% above the post-global financial crisis average, and uncertainty surrounding trade policy has risen to more than eight times its average since 2021.^[2] What we are experiencing is not merely a temporary disruption – it is a profound shift in how nations interact economically, financially and diplomatically. So, it does not come as a surprise that financial markets have experienced considerable volatility in recent weeks. It remains to be seen if, for markets to find a stable equilibrium, it will be enough to step back from the current international economic disorder towards a more stable, predictable and reliable trading system – a development that appears elusive in the short term. Against this backdrop, recent moves in exchange rates, bond yields and equities, suggest that US markets have not been playing their usual role as a safe haven in this particular episode of stress. This potentially has far-reaching longer-term implications for capital flows and the international financial system.

Today I will focus on three key points. First, we are seeing increasing signs of fragmentation becoming visible across the economy and financial system. Second, the implications of this accelerating fragmentation could extend far beyond the immediate disruptions, with consequences for growth, stability and prosperity. Third, in this evolving economic landscape, central banks must adapt their approaches yet retain a steadfast focus on their core mandates, while striving to preserve international cooperation.

The emerging reality of fragmentation

Let me begin by addressing a common belief – still held by many until recently – that, despite rising geopolitical tensions, globalisation appears largely resilient. Headline figures in trade and cross-border investment, for example, do indeed appear to support this belief. In 2024 world trade expanded to a record USD 33 trillion – up 3.7% from 2023. Similarly, the global stock of foreign direct investment reached an unprecedented USD 41 trillion.^[3] However, these surface-level indicators may not reflect the underlying realities, creating a misleading sense of stability when important changes are already underway. In reality, fragmentation is already happening in both the global economy and the financial system.

Fragmentation of the real economy

Fragmentation is most evident in rebalancing trade, driven by escalating geopolitical tensions. Take, for instance, the escalating US-China trade tensions that have been intensifying since 2018. Studies show the impact of geopolitical distance on trade has become notably negative. A doubling of geopolitical distance between countries – akin to moving from the position of Germany to that of India in relation to the United States – decreases bilateral trade flows by approximately 20%.^[4]

The series of shocks to the global economy in recent years have also contributed to this fragmentation. According to gravity model estimates, trade between geopolitically distant blocs has significantly declined. Trade between rivals is about 4% lower than it might have been without the heightened tensions post-2017, while trade between friends is approximately 6% higher.^[5] Global value chains are being reconfigured as companies respond to these new realities. In 2023 surveys already indicated that only about a quarter of leading firms operating in the euro area^[6] that sourced critical inputs from countries considered subject to elevated risk had not developed strategies to reduce their exposure.^[7]

However, these shifting trade patterns have not yet been reflected in overall global trade flows. Non-aligned countries have played a crucial role as intermediaries, or connectors, helping to sustain global trade levels even as direct trade between rival blocs declines.^[8] But this stabilising influence is unlikely to endure as trade fragmentation deepens and geopolitical alliances continue to shift.

The tariffs announced by the US Administration are far-reaching and affect a substantial share of global trade flows. The effects on the real economy are likely to be material. In its World Economic Outlook, published last week, the International Monetary Fund revised down global growth projections for 2025-26 by a cumulative 0.8 percentage points and global trade by a cumulative 2.3 percentage points.^[9] This notably reflects a negative hit from tariffs that ranges between 0.4% to 1% of world GDP by 2027.^[10] In particular, IMF growth projections for the United States have been revised down by a cumulative 1.3 percentage points in 2025-26. The cumulative impact on euro area growth is smaller, at 0.4 percentage points.

Financial fragmentation

The fragmentation we are witnessing in global trade is mirrored in the financial sector, where geopolitical tensions are also reshaping the landscape.

In recent years, global foreign direct investment flows have increasingly aligned with geopolitical divides. Foreign direct investment in new ventures has plunged by nearly two-thirds between countries from different geopolitical blocs. However, strong intra-bloc investments have helped sustain overall foreign direct investment levels globally, masking some of the fragmentation occurring beneath the surface.^[11]

But, as with trade flows, this dynamic is unlikely to persist as geopolitical tensions grow within established economic blocs. For instance, increased geopolitical distance is shown to curtail cross-border lending. A two standard deviation rise in geopolitical distance – akin to moving from the position of France to that of Pakistan in relation to Germany – leads to a reduction of 3 percentage points in cross-border bank lending.^[12]

The impact of fragmentation in global financial infrastructure is perhaps even more revealing. Since 2014 correspondent banking relationships – crucial for facilitating trade flows across countries – have declined by 20%. While other factors – such as a wave of concentration in the banking industry, technological disruptions and profitability considerations – have played a role^[13], the contribution of the geopolitical dimension can hardly be overstated. The repercussions of this decline can be profound. Research shows that when correspondent banking relationships are severed in a specific corridor, a firm’s likelihood of continuing to export between the two countries of that corridor falls by about 5 percentage points in the short term, and by about 20 percentage points after four years.^[14]

Contributing to this trend, countries such as China, Russia and Iran have launched multiple initiatives to develop alternatives to established networks such as SWIFT, raising the possibility of a fragmented global payment system.^[15] Geopolitical alignment now exerts a stronger influence than trade relationships or technical standards in connecting payment systems between countries.^[16] This poses risks of regional networks becoming more unstable, increased trade costs and settlement times, and reduced risk sharing across countries.

Additionally, we are witnessing a noticeable shift away from traditional reserve currencies, with growing interest in holding gold. Central banks purchased more than 1,000 tonnes of gold in 2024, almost double the level of the previous decade, with China being the largest purchaser, at over 225 tonnes. At market valuations, the share of gold in global official reserves has increased, reaching 20% in 2024, while that of the US dollar has decreased. Survey data suggest that two-thirds of central banks invested in gold to diversify, 40% to protect against geopolitical risk and 18% because of the uncertainty over the future of the international monetary system.^[17] There are further signs that geopolitical considerations increasingly influence decisions to invest in gold. The negative correlation of gold prices with real yields has broken down since 2022, a phenomenon we have also observed in recent weeks. This suggests that gold prices have been influenced by more than simply the use of gold to hedge against inflation. Moreover, countries geopolitically close to China and Russia have seen more pronounced increases in the share of gold in official foreign reserves since the last quarter of 2021.

The looming consequences of fragmentation

Accelerating fragmentation is resulting in the immediate disruptions we are now seeing, but this is likely to only be the beginning – potentially profound medium and long-term consequences for growth, stability and prosperity can be expected.

Medium-term impacts

The initial consequences of fragmentation are already evident in the form of increased uncertainty. In particular, trade policy uncertainty has led to a broader rise in global economic policy instability, which is stifling investment and dampening consumption. Our research suggests that the recent increase in trade policy uncertainty could reduce euro area business investment by 1.1% in the first year and real GDP growth by around 0.2 percentage points in 2025-26^[18]. Consumer sentiment is also under strain, with the ECB’s Consumer Expectations Survey revealing that rising geopolitical risks are leading to more pessimistic expectations, higher income uncertainty and ultimately a lower willingness to spend.^[19] Moreover, ECB staff estimates suggest that the observed increase in financial market volatility might imply lower GDP growth of about 0.2 percentage points in 2025.

Over the medium term, tariffs are set to have an unambiguously recessionary effect, both for countries imposing restrictions and those receiving them. The costs are particularly high when exchange rates fail to absorb tariff shocks, and some evidence suggests exchange rates have become less effective in this role.^[20]

The Eurosystem’s analysis of potential fragmentation scenarios suggests that such trade disruptions could turn out to be significant. In the case of a mild decoupling between the western (United States-centric) and the eastern (China-centric) bloc, where trade between East and West reverts to the level observed in the mid-1990s, global output could drop by close to 2%.^[21] In the more extreme case of a severe decoupling – essentially a halt to trade flows – between the two blocs, global output could drop by up to 9%. Trade-dependent nations would bear the brunt of these trade shocks, with China potentially suffering losses of between 5% and 20%, and the EU seeing declines ranging from 2.4% to 9.5% in the mild and severe decoupling scenarios respectively. The analysis also shows that the United States would be more significantly affected if it imposed additional trade restrictions against western and neutral economies – with real GDP losses of almost 11% in the severe decoupling scenario – whereas EU losses would increase only slightly in such a case.^[22]

The inflationary effects of trade fragmentation are more uncertain. They depend mainly on the response of exchange rates, firms’ markups and wages. Moreover, they are not distributed equally. While higher import costs and the ensuing price pressures are likely to drive up inflation in the countries raising tariffs, the impact is more ambiguous in other countries as a result of the tariffs’ global recessionary effects, which push down demand and commodity prices, as well as of the possible dumping of exports from countries with overcapacity. The short to medium-term effects may even prove disinflationary for the euro area, where real rates have increased and the euro has appreciated following US tariff announcements.

In fact, a key feature of most model-based assessments is that higher US tariffs lead to a depreciation of currencies against the US dollar, moderating the inflationary effect for the United States and amplifying it for other countries. But so far we have seen the opposite: the risk-off sentiment in response to US tariff announcements and economic policy uncertainty have led to capital flows away from the United States, depreciating the dollar and putting upward pressure on US bond yields. Conversely, the euro area benefited from safe haven flows, with the euro appreciating and nominal bond yields decreasing.

Long-term structural changes

The long-term consequences of economic fragmentation are inherently difficult to predict, but by drawing on historical examples and recognising emerging trends, it’s clear that we are on the verge of significant structural changes. Two areas stand out.

The first one is structurally lower growth. On this point, international economic literature has reached an overwhelming consensus.^[23] Quantitatively, point estimates might vary. For example, research of 151 countries spanning more than five decades of the 20th century reveals that higher tariffs have typically led to lower economic growth. This is largely due to key production factors – labour and capital – being redirected into less productive sectors.^[24]

However, data from the late 19th and early 20th centuries, a period which tariff supporters often look back to, seem to tell a different story. At that time, trade barriers across countries were high – the US effective tariff rate, for example, reached almost 60%, twice as high as after the 2 April tariffs. And sometimes countries imposing higher trade barriers enjoyed higher growth, which may provide motivation for current policymakers’ trade tariff policies. But these episodes need to be read in historical context. Before 1913, tariffs mostly shielded manufacturing, a high-productivity sector at the time, attracting labour from other, less productive sectors, like agriculture. Therefore, their negative effects were mitigated by the expansion of industries at the frontier of technological innovation. Moreover, the interwar years offer further nuance – the Smoot-Hawley tariffs of the 1930s had relatively limited direct effects on US growth, mainly because trade accounted for just 5% of the economy.

But today’s tariffs are unlikely to replicate the positive effects seen in the 19th century. Instead, they risk creating the same inefficiencies observed in the course of the 20th century, by diverting resources from high-productivity sectors to lower-productivity ones. This contractionary effect could lead to persistently lower global growth rates. In fact, the abolition of trade barriers within the EU and the international efforts towards lower trade barriers in the second half of the 20th century were a direct response to the economic and political impact of protectionism,^[25] which had played a key role in worsening and prolonging the Great Depression^[26] and had contributed to the formation of competing blocs in the run-up to the Second World War.^[27]

The second long-term shift driven by fragmentation might be the gradual transition from a US-dominated, global system to a more multipolar one, where multiple currencies compete for reserve status. For example, if the long-term implications of higher tariffs materialise, notably in the form of higher inflation, slower growth and higher US debt, this could undermine confidence in the US dollar’s dominant role in international trade and finance.^[28] Combined with a further disengagement from global geopolitical affairs and military alliances, this could, over time, undermine the “exorbitant privilege” enjoyed by the United States, resulting in higher interest rates domestically.^[29]

Moreover, as alternative payment systems gain traction, regional currencies may start to emerge as reserves within their respective blocs. This could be accompanied by the rise of competing payment systems, further fragmenting global financial flows and international trade. Such shifts would increase transaction costs and erode the capacity of countries to share risks on a global scale, making the world economy more fragmented and less efficient.

The central bank’s role in a fragmented world

So, as these tectonic shifts reshape the global economic landscape, central banks must adapt their approaches while remaining steadfast in their core mandates. The challenges posed by fragmentation require a delicate balance between confronting new realities and working to preserve the benefits of an integrated global economy. In order to navigate the present age of fragmentation, it is necessary to take action in four key areas.

First, central banks must focus on understanding and monitoring fragmentation. Traditional macroeconomic models often assume seamless global integration and may not fully capture the dynamics of a fragmenting world. Enhanced analytical frameworks that incorporate geopolitical factors and how businesses adjust to these risks will be essential for accurate forecasting and effective policy formulation. The Eurosystem is reflecting on these issues.

Second, monetary policy must adapt to the new nature of supply shocks generated by fragmentation. The effects of the greater frequency, size and more persistent nature of fragmentation-induced shocks and their incidence on prices require a careful calibration of our monetary responses. In this respect, our communication needs to acknowledge the uncertainty and trade-offs we face while giving a clear sense of how we will react depending on the incoming data. This can be done by making use of scenario analysis and providing clarity about our reaction function, as emphasised recently by President Lagarde.^[30]

Third, instead of building walls, we must forge unity. Even as political winds shift, central banks should strengthen international cooperation where possible. Through forums such as those provided by the BIS and the Financial Stability Board, we can keep open channels of cooperation that transcend borders. Our work on cross-border payments stands as proof of this commitment in line with the G20 Roadmap^[31]. The ECB is pioneering a cross-currency settlement service through TARGET Instant Payment Settlement (TIPS) – initially linking the euro, the Swedish krona and the Danish krone. We are exploring connections between TIPS and other fast-payment systems globally, both bilaterally and on the basis of a multilateral network such as the BIS’ Project Nexus.^[32]

And fourth, central banks must enhance their capacity to address financial stability risks arising from fragmentation. The potential for sudden stops in capital flows, payment disruptions and volatility in currency markets requires robust contingency planning and crisis management frameworks. Global financial interlinkages and spillovers highlight the importance of preserving and further reinforcing the global financial safety net so that we can swiftly and effectively address financial stress, which is more likely to emerge in a fragmenting world.^[33]

In fact, the lesson from the 1930s is that international coordination is key to avoiding protectionist snowball effects, where tit-for-tat trade barriers multiply as each country seeks to direct spending to merchandise produced at home rather than abroad.^[34] In order to avoid this, the G20 countries committed to preserving open trade could call an international trade conference to avoid beggar-thy-neighbour policies^[35] and instead agree on other measures, such as macroeconomic policies that can support the global economy in this period of uncertainty and contribute to reduce global imbalances.

Let me finally emphasise that the current situation also has important implications for the euro area. If the EU upholds its status as a reliable partner that defends trade openness, investor protection, the rule of law and central bank independence, the euro has the potential to play the role of a global public good. This requires a deep, trusted market for internationally accepted euro debt securities. That is why policy efforts to integrate and deepen European capital markets must go hand in hand with efforts to issue European safe assets.^[36]

Conclusion

Let me conclude.

As we stand at this crossroads of global fragmentation, we must confront an uncomfortable truth: we are drifting toward a fractured economic and financial landscape where trust is eroded and alliances are strained.

Central banks now face a double challenge: to be an anchor of stability in turbulent economic waters while reimagining their role in a world where multiple economic blocs are forming. The question is not whether we adapt, but how we mitigate the costs of fragmentation without sacrificing the potential of global integration.

Our greatest risk lies not in the shocks we anticipate, but in the alliances we neglect, the innovations we overlook and the common ground we fail to find. The future of global prosperity hinges on our ability to use fragmentation as a catalyst to reinvent the common good.

MIL OSI Europe News –

April 29, 2025

MIL-OSI: Bank of Åland Plc: Interim Report for the period January – March 2025

Source: GlobeNewswire (MIL-OSI)

Bank of Åland Plc
Interim Report
April 29, 2025 9.00 EET

Interim Report for the period January – March 2025

A strong start to the year in terms of earnings

“We started 2025 with a strong net operating profit of EUR 18.3 million (16.9) and a return on equity of 19.5 (18.3) per cent.

“Our income is increasing, and it is primarily net commission income that is climbing due to large transaction volume in our financial investment business. Expenses rose in a controlled manner, and impairment losses (including recoveries) totalled a recovery of EUR 0.1 million during the first quarter.

“We are currently seeing a great deal of uncertainty in the world’s capital markets, and we expect this uncertainty to persist for some time to come. The Bank of Åland is also well equipped for more turbulent times. As proof of this, in March Moody’s Ratings raised its outlook for the Bank of Åland to positive from stable and affirmed the Bank’s long-term deposit rating at A3.”

Peter Wiklöf, Managing Director and Chief Executive

January−March 2025 compared to January – March 2024

Net operating profit increased by 9 per cent and amounted to EUR 18.3 M (16.9).
Core income in the form of net interest income, net commission income and IT income increased by 2 per cent to EUR 53.8 M (53.0).
Other income improved to EUR 2.2 M (0.8).
Total expenses increased by 4 per cent to EUR 37.7 M (36.4).
Net impairment losses on financial assets (including recoveries) amounted to a recovery of EUR 0.1 M (loss of 0.5), equivalent to a loan loss level of −0.01 per cent (0.05).
Return on equity after taxes (ROE) increased to 19.5 per cent (18.3).
Earnings per share increased by 7 per cent to EUR 0.95 (0.89).
The common equity Tier 1 capital ratio decreased to 12.7 per cent (14.5 on December 31, 2024).
Unchanged future outlook: The Bank of Åland expects its return on equity after taxes (ROE) to continue to exceed its long-term financial target of 15 per cent during 2025.

Financial Summary

Group	Q1 2025	Q4 2024	%	Q1 2024	%
EUR M
Income
Net interest income	23.8	25.2	-6	26.3	-10
Net commission income	21.4	19.9	8	18.3	17
IT income	8.6	9.4	-9	8.4	3
Other income	2.2	-0.4		0.8
Total income	56.0	54.1	3	53.8	4

Staff costs	-23.4	-22.1	6	-21.6	8
Other expenses	-11.3	-12.4	-8	-11.5	-2
Depreciation/amortisation	-3.0	-2.8	6	-3.2	-8
Total expenses	-37.7	-37.3	1	-36.4	4

Profit before impairment losses	18.3	16.8	9	17.4	5

Impairment losses on financial assets, net	0.1	-1.5		-0.5
Net operating profit	18.3	15.3	20	16.9	9

Income taxes	-3.7	-2.9	27	-3.3	14
Profit for the period	14.6	12.4	19	13.6	7

Volume
Lending to the public	3,552	3,576	-1	3,762	-6
Deposits from the public	3,573	3,521	1	3,399	5
Actively managed assets	10,662	10,616	0	10,100	6
Managed mortage loans	3,335	3,080	8	2,584	29
Equity capital	315	336	-6	302	4
Balance sheet total	5,011	4,925	2	5,111	-2
Risk exposure amount	1,803	1,643	10	1,761	2

The Bank of Åland (Ålandsbanken) follows the disclosure procedure stipulated in “Disclosure obligation of the issuer (6/2016)”, published by the Finnish Financial Supervisory Authority and hereby publishes its Interim Report for the period January – March 2025, which is enclosed with this stock exchange release. The Bank`s Interim Report for the period January – March 2025 is attached to this release in PDF format and is also available on the company’s web site at https://www.alandsbanken.fi/uploads/pdf/result/en_resultat_jan-mar_25.pdf

Mariehamn, April 29, 2025

THE BOARD OF DIRECTORS

For more information please contact:

Peter Wiklöf, Managing Director and Chief Executive, Bank of Åland, tel. + 358 (0)40 512 7505

Attachment

alandsbanken_en_resultat_jan-mar_25

The MIL Network –

April 29, 2025

MIL-OSI: Annual report and financial statements for the period ended 31 December 2024

Source: GlobeNewswire (MIL-OSI)

OCTOPUS FUTURE GENERATIONS VCT PLC

Annual report and financial statements for the period ended 31 December 2024

Octopus Future Generations VCT plc (‘Future Generations VCT’ or the ‘Company’) is backing businesses that aim to address some of society’s biggest challenges, providing an opportunity for investors to share in the growth of ambitious, purpose‑driven companies.

The Company is managed by Octopus AIF Management Limited (the ‘Manager’), which has delegated investment management to Octopus Investments Limited (‘Octopus’ or ‘Portfolio Manager’) via its investment team Octopus Ventures.

Chair’s statement

I am pleased to present the financial report and audited accounts for the Company for the 18 months to 31 December 2024.

I would like to welcome all of our new shareholders to the Company. Future Generations VCT invests in exciting early-stage companies which aspire to address current environmental and societal issues. In 2023, the Board reviewed and approved a proposal to move the Company’s year end from 30 June to 31 December. As a result, shareholders are receiving this annual report covering an extended 18-month period and will thereafter receive a half-year report as at June, and annual report and audited financial statements for the years ending December thereafter.

The NAV per share at 31 December 2024 was 88.8p, which represents a net decrease of 5.5p per share from 30 June 2023. In the 18 months to 31 December 2024, we utilised £10.1 million of our cash resources, including £8.2 million which was invested into 16 new and follow‑on opportunities. The cash balance of £20.1 million (excluding cash awaiting allotment) as at 31 December 2024 represents 42% of net assets at that date. The loss made in the period to 31 December 2024 was £2.9 million. This decline is reflective of some company specific performance challenges and the difficult funding conditions in the early-stage space which have led to downward movements in some valuations. Given the Company is still a relatively young VCT, many of its portfolio companies are at the beginning of their journey and will likely require further funding to succeed, so it is to be expected to see under performance or even failures before any growth in value of companies which are ultimately successful. The decline is also accentuated by the running costs of the Company exceeding returns from investments, which is to be anticipated at this stage.

We look forward to deploying further capital into attractive new investment opportunities, and we ultimately intend the profile of the Company to comprise 80% to 90% in VCT qualifying investments and 10% to 20% in permitted non-VCT qualifying investments or cash.

Fundraise
We raised £3.6 million in the fundraise which closed on 31 October 2024. The 2023/2024 VCT fundraise market was highly competitive, ranking as the third highest on record with £882 million raised. In this environment, newer VCTs such as ours faced challenges in raising funds, as we compete with more established funds.

On 3 February 2025, to further support the Company’s growth, the Board launched an initial offer to raise up to £5 million. The offer closed for new applications on 1 April 2025 for the 2024/2025 tax year having successfully raised £5.0 million.

As investors will be aware, the intention is to invest in businesses which meet one of three key themes, which we hope will demonstrate excellent investment prospects as well as having the potential to transform the world we live in for the better.

VCT status
In November 2023, a ten-year extension was announced to the ‘sunset clause’ (a retirement date for the VCT scheme), meaning that VCT tax reliefs will be available until 5 April 2035. This extension passed through Parliament in February 2024 and on 3 September 2024 His Majesty’s Treasury brought the extension into effect through The Finance Act 2024.

Board of Directors
As announced in the half-yearly report to 31 December 2023, Emma Davies announced her retirement from the Board of Directors with effect from 31 March 2024 and Ajay Chowdhury was appointed with effect from 1 March 2024 and was elected by shareholders at the Annual General Meeting (AGM) held in December. We are already benefiting from his extensive experience in the early-stage venture ecosystem.

All the other Directors have indicated their willingness to remain on the Board and will be seeking re-election at the AGM.

Portfolio Manager
In September 2024, Octopus Titan VCT PLC, a fund which the Company has co-invested alongside to date, announced a review of strategy, due to the ongoing performance issues it has faced. This review (which benefits from independent external advice) is ongoing, and when concluded, the results will be shared with the Board of the Company and via any public announcements that the Board of Octopus Titan VCT PLC may make.

During this period, the investment team has prioritised much of its resource towards those portfolio companies which they believe have the potential to drive the greatest returns. This has affected your Company’s investment rate into new opportunities.

In the meantime, there have been a significant number of leavers from the broader Octopus Ventures team which invests capital from both the Company and other funds under management. Simon King, Octopus’ Lead Fund Manager for Future Generations, has unfortunately resigned to pursue a new opportunity after 13 years with Octopus. He will continue to take an active role as Lead Fund Manager of the Company until late summer. I would like to take this opportunity to thank Simon for his contribution and to wish him well for the future. We will provide you with updates in due course regarding his potential successor.

Erin Platts was appointed as new Chief Executive Officer (CEO) of Octopus Ventures in January 2025. Previously, she was CEO of HSBC Innovation Banking UK, formerly Silicon Valley Bank UK and worked at the heart of the UK and European tech ecosystem. Erin will be looking to scale the Octopus Ventures business, including ensuring there is appropriate investment and portfolio management resource to support the ongoing success of the Company.

AGM
The AGM will take place on 4 June 2025 from 10am and will be held at 33 Holborn, London EC1N 2HT. Full details of the business to be conducted at the AGM are given in the Notice of the AGM. We will have a Portfolio Manager’s update at the AGM, supported by a filmed update from the Portfolio Manager which will be available on the website at www.octopusinvestments.com/futuregenvct/.

Shareholders’ views are important, and the Board encourages shareholders to vote on the resolutions within the Notice of the AGM using the proxy form, or electronically at www.investorcentre.co.uk/eproxy. The Board has carefully considered the business to be approved at the AGM and recommends shareholders to vote in favour of all the resolutions being proposed, as the Board will be doing.

Outlook
In the 18-month reporting period, the sharpest decline in NAV was seen in the first half of 2024 with a 7.1% drop. This was reflective of some of the portfolio companies struggling to scale, secure customer wins and successfully fundraise, meaning they were not achieving the milestones set at the time the Company invested. With companies not able to prove their business models, we will unfortunately see some fail. The Board is mindful that such performance is not an unusual outcome for a VCT at this stage of its investment life cycle, with any failures likely preceding valuation growth which is usually expected once the portfolio matures. The portfolio has been operating in a volatile macro environment since the Company launched and global geo-political and economic pressures continue to hamper some of their growth plans. However, we are satisfied to see a stabilisation in the NAV, with the portfolio showing a positive return in the six months from June to December 2024.

The Mergers and Acquisitions (M&A) environment has started to thaw with startups experiencing the highest annual M&A transaction levels since 2019¹. We are delighted to have been able to realise the Company’s first full and partial exits in the reporting period. These exits within just three years of launch we hope provide validation of Future Generations VCT’s investment strategy, demonstrating the ability of Octopus to identify and back high-potential companies while delivering early returns to the VCT and brings confidence that it is well positioned to generate long-term, sustainable value for shareholders.

The long-term target is to pay an annual dividend of 5% of the NAV. However, given the expected holding period of target portfolio companies and restrictions imposed on VCTs, it is very unlikely that the Company will be able to pay dividends before 2026. During this time, any growth in value will increase the net asset value of the Company. Dividends are likely to be generated from successful exits, so the Company is unlikely to pay significant dividends until more portfolio companies have time to mature and realisations are secured.

I would like to conclude by thanking both my Board colleagues and the Octopus team on behalf of all shareholders for their hard work. The Board’s long-term view of early-stage venture capital remains positive, and I am looking forward to seeing what 2025 brings for your Company.

Helen Sinclair
Chair

¹ https://carta.com/uk/en/data/state-of-private-markets-q4-2024/#key-trends

Portfolio Manager’s review

At Octopus, our focus is on managing your investments and providing investors with clear and transparent communication. Our annual and half-yearly updates are designed to keep you informed about the progress of your investment.

Focus on Future Generations VCT’s performance
The NAV per share at 31 December 2024 was 88.8p, which represents a decrease in NAV of 5.5p per share versus a NAV of 94.3p per share as at 30 June 2023. The Company invests in three key areas that we believe demonstrate excellent investment prospects and have potential to transform our world for the better.

Below is a breakdown of the 36 investments held as at 31 December 2024, showing the proportion and value of the portfolio in each investment theme:

Proportion by number of portfolio companies in each theme
Revitalising healthcare: 53%
Empowering people: 28%
Building a sustainable planet: 19%

Value of the portfolio in each theme
Revitalising healthcare: £13.3m
Empowering people: £8.0m
Building a sustainable planet: £5.5m

The decline in valuation over the 18-month period has been in large part driven by the downward valuation movements across 11 companies which saw a collective decrease in valuation of £7.9 million. The businesses which contributed most significantly to this were Tympa Health, Pear Bio and Elo Health. Tympa Health over‑invested in growth and had to make significant cost cuts and changes to senior management whilst running a fundraise process. It has successfully concluded a further investment round, but at a reduced valuation and the Company’s shareholding now sits behind a large preference stack, meaning that other investors get paid back first before the Company would see any returns. Pear Bio also had to significantly reduce its cash burn but has limited runway and needs to further fundraise, so the valuation has been reduced to reflect the risk to its future. Elo Health struggled to find a market fit and execute on the investment thesis, so to extend its cash runway it had to raise an investment round at a reduced valuation. These three valuation movements account for 86% of the total decline in the reporting period. The total investment cost of these three companies was £7 million.

Octopus Ventures believes that some of the companies which have seen decreased valuations in the 18 months have the potential to overcome the issues they face and get their growth plans back on track. We will continue to work with them to help them realise their ambitions. In some cases, if a company is achieving its performance milestones, the support offered could include further funding, to ensure a business has the capital it needs to execute on its strategy. At this early stage of the Company’s life cycle, it is to be anticipated that failures will likely precede valuation growth, which takes longer as the portfolio companies must achieve their agreed milestones and mature.

Conversely, 12 companies saw an increase in unrealised valuation in the period, delivering a collective increase in valuation of £4.4 million. These valuation increases reflect businesses which have successfully concluded further funding rounds, grown revenues or met certain important milestones. Notable strong performers in the portfolio include Apheris and Manual, both of which have shown impressive capital efficient growth. These strong performers demonstrate that there are opportunities available for companies to scale.

The interest on Future Generation’s uninvested cash reserves was £1.4 million in the 18 months to 31 December 2024 (30 June 2023: gain of £0.4 million), driven by returns on money market funds. The Board’s objective for these investments is to generate sufficient returns through the cycle to cover costs, at limited risk to capital.

Disposals
In September 2024, as part of a Series A funding round, Octopus sold a portion of the Company’s shares in Neat. Then in November, Pluxee (a global leader in employee benefits) acquired Cobee. The two exits combined offer the Company a return of 1.5x, including contingent deferred proceeds.

Overview of investments
The Company completed 16 investments in the 18 months to 31 December 2024 (comprising a total of £8.2 million) and 4 further investments after the reporting date totalling £2.4 million. More information on some of these businesses can be found below:

A selection of our completed investments

Revitalising Healthcare

Pencil Biosciences is a gene editing technology platform.

Awell Health automates routine clinical tasks, synchronising data between systems and driving seamless coordination between care teams and patients.

Cellvoyant is an artificial intelligence (AI) first biotechnology company creating novel stem cell-based therapies for chronic diseases.

Manual provides easy access to advice and medical support for diagnosis, custom treatment plans and holistic care to induce long-term behaviour change.

Nanosyrinx has developed a targeted biologic therapeutic delivery platform (a nano-syringe).

Empowering people

Correcto is an AI writing and grammar tool for the Spanish language.

Remofirst is an Employer of Record (EOR) and compliance platform that allows companies to hire and pay employees globally.

Swiipr has developed a digital payments platform specifically for the airline industry.

Building a sustainable planet

Metris Energy has created a platform that allows landlords of multi-unit buildings to monetise modular renewable energy projects through a single billing platform to charge tenants.

Drift is designing sailing vessels and routing algorithms required to capture deep water wind energy and convert it into onboard hydrogen gas for transportation back to shore using a fully integrated desalination, electrolysis and storage system.

Q&A

Q. How do you value a portfolio company?
A. Future Generations VCT’s unquoted portfolio companies are valued in accordance with UK Generally Accepted Accounting Practice (UK GAAP) accounting standards and the International Private Equity and Venture Capital (IPEV) valuation guidelines.

This means we value the portfolio at fair value, with all companies being valued at least twice yearly, for our half-year (June) and annual accounts (December).

Q. What do you mean by ‘fair value’?
A. When we say fair value, we mean the price we expect people would be willing to buy or sell an asset for, assuming they understand the asset and market conditions, are knowledgeable parties, act independently, and that the transaction is carried out under the normal course of business (i.e. is not rushed and proper marketing has taken place).

Q. Who values the portfolio, what is the process and what oversight is there to make sure this is right?
A. The Octopus Investment Managers involved with the portfolio companies, either in the capacity of a Director or observer on the board, or the primary contact, will provide commentary including, but not limited to, recent developments with the portfolio and the wider market in which they operate, progress towards milestones, management team changes, board dynamics and technical progress. This is combined with the latest available financial accounts and budget provided by the portfolio company which will be summarised into Key Performance Indicators (KPIs).

From this information, a member of the separate Valuations team drafts the initial proposal. This will highlight any material changes, key asset level assumptions used and KPIs, and discuss portfolio company performance as well as the rationale underpinning the selected valuation methodology. A peer review exercise then takes place, where the proposals are challenged and reviewed. The peer reviewer is an investment professional from the Fund Manager (typically the Lead Fund Manager) who has not been involved in preparing the valuations.

This will then be reviewed and approved by the Octopus Valuations Committee which comprises individuals with appropriate expertise and experience in valuations. Those individuals are not involved in the investment decisions and as such can independently review and challenge. The Future Generations VCT Board will then meet to discuss them in detail, revise as necessary and ultimately approve them.

There are also more valuation checkpoints throughout the year in advance of allotments and other share-related transactions, which means that the portfolio’s valuation is reviewed to ensure NAV is fairly represented prior to these corporate actions.

As part of our continuous improvement processes, we periodically review the actual realised value of our investments compared to their last holding value and refine our valuation methodologies accordingly. This, combined with the high proportion of valuations that are based on the terms of further funding rounds led by new external investors, firmly underpins the robustness of the valuation process.

Valuations
The table illustrates the split of valuation methodology (shown as a percentage of portfolio value and number of companies). ‘External price’ includes valuations based on funding rounds that typically completed in the last 18 months to the period end or shortly after the period end, and exits of companies where terms have been agreed with an acquirer. ‘Multiples’ is predominantly used for valuations that are based on a multiple of revenues for portfolio companies. Where there is uncertainty around the potential outcomes available to a company, a probability weighted ‘scenario analysis’ is considered.

Valuation methodology	By value	By number of companies
Multiples	18%	3
External price	44%	12
Scenario analysis	14%	7
Milestone analysis	24%	10
Write-off	—	4

Portfolio case studies

CoMind
CoMind is building revolutionary brain sensing technologies.

Their mission is to redefine the way the brain is measured and treated at every stage of care. One of the first applications of CoMind’s core technology is in measuring intracranial brain pressure using an adhesive sensor and advanced signal processing. This will be a step change from the current standard of having to drill through the skull to measure intracranial pressure in patients impacted by traumatic brain injury, stroke, and/or other neurocritical conditions.

While other companies are trying to create noninvasive technology in this sector, we believe CoMind has a distinct competitive advantage. CoMind has developed an advanced optical sensing technique that has opened up new possibilities in monitoring brain health. Unlike existing methods, CoMind’s technology is more similar to the “LiDAR” (Light Detection and Ranging) systems used in self-driving cars. This allows CoMind’s devices to give a unique, detailed view of brain health, helping doctors deliver more personalised and targeted treatments to patients at every stage of care.

>250 subjects were measured in 2024.
Several devices are currently being used in hospitals for clinical trials.

Swiipr
Passengers get quick, easy-to-use compensation, airlines save on processing costs while improving service.

When flights are disrupted, compensating passengers is a hassle for both airlines and travellers. Swiipr’s platform simplifies this by automating payment verification and processing through a system designed specifically for airlines. The company provides passengers with virtual and physical prepaid cards, offering instant, flexible spending compared to outdated paper vouchers or slow payments. Swiipr also supports airlines with solutions for crew, operational, and crisis payments, enabling fast, direct payouts to staff. Passengers get quick, easy-to-use compensation, airlines save on processing costs while improving service, and retailers benefit from instant payment settlement. Swiipr also integrates with airline Customer Relationship Management systems, making it an essential partner for the industry.

Octopus Ventures is excited about Swiipr’s travel-focused digital payments solution and its potential to revolutionise how airlines handle pay-outs. Swiipr’s innovative product aims to transform compensation payments and speed up management processes for airlines and beyond. By enabling digital payments, Swiipr seeks to boost efficiency, enhance customer experiences, and provide automated processes that are transparent and compliant with regulations.

With over 500 million passengers affected by travel disruptions each year, simplifying the path to compensation has the potential to significantly improve customer satisfaction, build trust, and foster loyalty in the industry.

Only 1–2% of disrupted passengers currently receive compensation.
Billions of dollars lost by passengers in outdated, inefficient pay-out processes every year.
Pay360 Payment Award winner: Best B2B Programme and Best Customer Facing Experience at the 2024 awards.

DRIFT
DRIFT aims to drive the clean energy transition worldwide with high-performance sailing vessels that harness deep ocean wind to produce green hydrogen at sea and deliver it globally.

It does this using a unique, AI-enabled vessel routing system that enables the vessels to find and stay in optimum weather conditions. The growing demand for clean hydrogen to accelerate the decarbonisation of sectors such as heavy industry, transportation and manufacturing is sparking innovation in the sector. DRIFT’s solution is mobile, resilient and works outside of existing infrastructure. The company is developing renewable energy partnerships that will benefit coastal and island communities around the world.

DRIFT is leading the way in developing a truly innovative new class of mobile renewable energy, building the world’s first net-positive ships and unlocking a new era of clean fuel generation capable of covering 70% of the globe. The company’s technology uniquely unlocks the planet’s greatest resource, overcoming supply challenges and enabling a fair and equitable clean energy transition.

€10 trillion: Goldman Sachs estimates that the green hydrogen market could reach €10 trillion by 2050.

24%: Bank of America predicts that clean hydrogen could provide 24% of global energy needs by 2050.

COP 28 winner: DRIFT is a COP 28 award-winning DeepTech company and winner of the Monaco Prize for Innovation in Renewable Hydrogen and Transportation 2024.

Top 10 investments
Here, we set out the cost and valuation of the top 10 holdings, which account for over 58% of the value of the portfolio.

Portfolio company	Investment cost	Valuation at 31 December 2024	Investment Theme
1. HelloSelf Limited	£2.6m	£2.6m	Revitalising healthcare
2. Remofirst, Inc	£1.2m	£1.7m	Empowering people
3. Infinitopes Ltd	£1.6m	£1.6m	Revitalising healthcare
4. Neat SAS	£0.6m	£1.5m	Building a sustainable planet
5. TYTN Ltd (t/a TitanML)	£0.5m	£1.5m	Building a sustainable planet
6. Apheris AI GmbH	£1.5m	£1.5m	Empowering people
7. Menwell Limited (t/a Manual)	£0.9m	£1.5m	Revitalising healthcare
8. Mr & Mrs Oliver Ltd (t/a Skin + Me)	£1.0m	£1.4m	Revitalising healthcare
9. Intrinsic Semiconductor Technologies Ltd	£0.9m	£1.2m	Empowering people
10. CoMind Technologies Ltd	£0.8m	£1.0m	Revitalising healthcare

Top 10 investments in detail¹

HelloSelf Limited
A digital, personalised psychological therapy and coaching platform.
www.helloself.com

Initial investment date:	January 2023
Investment cost:	£2.6m
	(2023: £2.6m)
Valuation:	£2.6m
	(2023: £2.6m)
Last submitted accounts:	31 March 2024
Turnover:	Not available² (2023: Not available²)
Profit/(loss) before tax:	Not available²
	(2023: Not available²)
Net assets:	£(15.5)m
	(2023: £(9.8)m)
Valuation methodology:	Calibration

2
Remofirst, Inc.
Global payroll and compliance system for remote teams.
www.remofirst.com

Initial investment date:	February 2024
Investment cost:	£1.2m
	(2023: n/a)
Valuation:	£1.7m
	(2023: n/a)
Last submitted accounts:	Not available²
Turnover:	Not available²
	(2023: Not available²)
Profit/(loss) before tax	Not available²
	(2023: Not available²)
Net assets:	Not available²
	(2023: Not available²)
Valuation methodology:	Last Round

3
Infinitopes Ltd
Has built an antigen discovery platform to develop cancer vaccines that provide better treatment outcomes.
www.infinitopes.com

Initial investment date:	December 2022
Investment cost:	£1.6m
	(2023: £1.6m)
Valuation:	£1.6m
	(2023: £1.6m)
Last submitted accounts:	31 December 2023
Turnover:	Not available²
	(2023: Not available²)
Profit/(loss) before tax	Not available²
	(2023: Not available²)
Net assets:	£9.3m
	(2023: £8.1m)
Valuation methodology:	Last Round

4
Neat SAS
An embedded insurance platform that gives merchants the ability to provide insurance bundles to their customers at a competitive rate.
mobility.neat.eu

Initial investment date:	November 2022
Investment cost:	£0.6m
	(2023: £0.8m)
Valuation:	£1.5m
	(2023: £0.8m)
Last submitted accounts:	Not available²
Turnover:	Not available²
	(2023: Not available²)
Profit/(loss) before tax:	Not available²
	(2023: Not available²)
Net assets:	Not available²
	(2023: Not available²)
Valuation methodology:	Last round

TYTN Ltd (t/a TitanML)
An artificial intelligence company which is developing a one-stop-shop for Natural Language Processing AI Optimisation, allowing enterprises to generate value from their data.
www.titanml.co

Initial investment date:	February 2023
Investment cost:	£0.5m
	(2023: £0.5m)
Valuation:	£1.5m
	(2023: £0.5m)
Last submitted accounts:	30 April 2024
Turnover:	Not available²
	(2023: Not available²)
Profit/(loss) before tax:	Not available²
	(2023: Not available²)
Net assets:	£1.5m
	(2023: £2.0m)
Valuation methodology:	Last Round

Apheris AI GmbH
An end-to-end federated learning platform enabling data scientists to conduct analysis over sensitive data without compromising the privacy or security of the data subjects.
www.apheris.com

Initial investment date:	November 2022
Investment cost:	£1.5m
	(2023: £1.2m)
Valuation:	£1.5m
	(2023: £1.2m)
Last submitted accounts:	Not available²
Turnover:	Not available²
	(2023: Not available²)
Profit/(loss) before tax:	Not available²
	(2023: Not available²)
Net assets:	Not available²
	(2023: Not available²)
Valuation methodology:	Last round

Menwell Limited (t/a Manual)
Making high-quality healthcare more accessible and stigma-free
www.manual.co

Initial investment date:	May 2024
Investment cost:	£0.9m (2023: n/a)
Valuation:	£1.5m
	(2023: n/a)
Last submitted accounts:	31 December 2023
Turnover:	£54.7m (2023: £22.4m)
Profit/(loss) before tax:	£(7.9)m (2023: £(10.6)m)
Net assets:	£11.8m (2023: £8.0m)
Valuation methodology:	Last round

8
Mr & Mrs Oliver Ltd (t/a Skin + Me)
A direct to consumer, personalised skin care company.
www.skinandme.com

Initial investment date:	December 2022
Investment cost:	£1.0m
	(2023: £1.0m)
Valuation:	£1.4m
	(2023: £1.3m)
Last submitted accounts:	31 August 2023
Turnover:	£28.7m
	(2023: £14.3m)
Profit/(loss) before tax:	£1.8m
	(2023: £(3.3)m)
Net assets:	£12.8m
	(2023: £(0.7)m)
Valuation methodology:	Revenue Multiple

9
Intrinsic Semiconductor Technologies Ltd
Solid state memory technology that is simple to integrate and faster than current alternatives like Flash.
www.intrinsicsemi.com

Initial investment date:	December 2023
Investment cost:	£0.9m
	(2023: n/a)
Valuation:	£1.2m
	(2023: n/a)
Last submitted group accounts:	31 December 2023
Turnover:	Not available² (2023: Not available²)
Profit/(loss) before tax:	Not available² (2023: Not available²)
Consolidated net assets:	£4.0m
	(2023: £5.5m)
Valuation methodology:	Scenario Analysis

CoMind Technologies Ltd
Development of non-invasive brain sensing technology for monitoring of medical conditions.
comind.io

Initial investment date:	November 2023
Investment cost:	£0.8m
	(2023: n/a)
Valuation:	£1.0m
	(2023: n/a)
Last submitted group accounts:	31 December 2023
Turnover:	Not available² (2023: Not available²)
Profit/(loss) before tax:	Not available² (2023: Not available²)
Net assets:	£17.1m
	(2023: £4.1m)
Valuation methodology:	Milestone Analysis

1. These are numbers per latest public filings. More recent figures have not yet been disclosed.
2. Information not publicly available.

Portfolio engagement
As part of our strategy, we require portfolio companies to put in place a Diversity and Inclusion policy (D&I) and an Anti-Harassment policy. We also engage with each company to help them understand their greenhouse gas (GHG) emissions and support them to take action to minimise them. You can see how we are progressing with these goals below, as at the date of this report:

D&I policy status
Policy in place: 100%

Engaged in monitoring 2023 greenhouse gas emissions¹
Signed up: 16
Introduced: 19
In progress: 1

¹ As of 31 December 2024, only 2023 carbon emissions data was available.

Outlook
Despite the declining NAV in the reporting period, we are reassured to see an increase in the NAV per share of the fund in the last six months. This, combined with the two profitable realisations in the period, is offering us early proof points of the Company’s investment strategy to deliver sustainable growth as it moves into its third year of deployment. With a more diversified portfolio, in terms of both stage and sector, this also offers a clearer path for the Company to enter a growth phase.

As is to be expected at this stage in the Company’s lifecycle, it has started to make its first follow-on investments into portfolio companies which are achieving their agreed milestones and successfully gaining new external lead funders. The Company made two follow-on investments in the reporting period and three after.

This strategy of reinvesting into existing portfolio companies aims to increase the Company’s stake in portfolio companies that have achieved market fit and are scaling successfully, supporting its overall growth plan. Along with further financial support, Octopus’ resources are directed in the most impactful way, both through Octopus-appointed non-executive Directors or monitors on the boards and our in-house People and Talent team. This team works directly with the portfolio company management teams, offering training and recruitment support to ensure the best talent pool is being explored to help drive success.

We are excited to have the opportunity to continue to scale the Company, support its ambition to make the world a better place for future generations, and hope to deliver attractive returns to shareholders.

Simon King
Partner and Lead Fund Manager for Future Generations VCT

Risks and risk management

The Board assesses the risks faced by Future Generations VCT, reviews the mitigating controls and monitors the effectiveness of these controls.

Emerging and principal risks, and risk management
The Board is mindful of the ongoing risks and will continue to make sure that appropriate safeguards are in place. The Board carries out a regular review of the risk environment in which the Company operates.

Emerging risks

The Board has considered emerging risks. The Board seeks to mitigate risks by setting policy, regularly reviewing performance and monitoring progress and compliance. In the mitigation and management of these risks, the Board applies the principles detailed in the Financial Reporting Council’s Guidance on Risk Management, Internal Control and Related Financial and Business Reporting.

The following are some of the potential emerging risks management and the Board are currently monitoring:

adverse changes in global macroeconomic environment;
challenging market conditions for private company fundraising and exits;
geo‑political instability; and
climate change.

Detailed below are the principal risks of Future Generations VCT, and the mitigating actions in relation to those risks.

Principal risks

*Risk*	*Mitigation*	*Change*
Investment performance:
The focus of Future Generations VCT investments is into early-stage, unquoted, small and medium‑sized VCT qualifying companies which, by their nature, entail a higher level of risk and shorter cash runway than investments in larger quoted companies.	Octopus has significant experience of investing in early-stage unquoted companies, and appropriate due diligence is undertaken on every new investment. A member of the Octopus Ventures team is appointed to the board of a portfolio company using a risk-based approach, considering the size of the company within the Future Generations VCT portfolio and the engagement levels of other investors. This arrangement, in conjunction with its Portfolio Talent team’s active involvement, allows Future Generations VCT to play a prominent role in a portfolio company’s ongoing development and strategy.	Increased exposures reflected in the previous period remain unchanged due to the difficult macro environment and challenging trading conditions for some portfolio companies continuing.
*Risk*	*Mitigation*	*Change*
VCT qualifying status:
Future Generations VCT is required at all times to observe the conditions for the maintenance of approved VCT status. The loss of such approval could lead to Future Generations VCT and its investors losing access to the various tax benefits associated with VCT status and investment.	Octopus tracks Future Generations VCT’s qualifying status throughout the period, and reviews this at key points, including at the point of investment and realisation. This status is reported to the Board at each Board meeting. The Future Generations VCT Board has also engaged external independent advisers to undertake an independent VCT status monitoring role.	VCT status monitoring by independent advisers continues to reduce the risk of an issue causing a loss of VCT status.
*Risk*	*Mitigation*	*Change*
Loss of key people:
The loss of key investment staff by the Portfolio Manager could lead to poor fund management and/or performance due to lack of continuity or understanding of Future Generations VCT.	The Portfolio Manager has a broad team experienced in and focused on early-stage investing. This mitigates the risk of any one individual with the required skill set and knowledge of venture capital investing, and the portfolio specifically, leaving. Key investment staff are also incentivised via the performance incentive fee.	The increase is attributed to the departure of key personnel from the Octopus Ventures team and risk exposure reflects a reduction in performance fees potentially increasing attrition.
*Risk*	*Mitigation*	*Change*
Operational:
The Future Generations VCT Board is reliant on the Portfolio Manager to manage investments effectively, and manage the services of a number of third parties, in particular the registrar, depositary and tax advisers. A failure of the systems or controls at Octopus or third‑party providers could lead to an inability to provide accurate reporting and accounting and to ensure adherence to VCT rules.	The Future Generations VCT Board reviews the system of internal controls, both financial and non-financial, operated by Octopus (to the extent the latter are relevant to Future Generations VCT’s internal controls). These include controls designed to make sure that Future Generations VCT assets are safeguarded and that proper accounting records are maintained.	No overall change in risk exposure on balance.
*Risk*	*Mitigation*	*Change*
Information security:
A loss of key data could result in a data breach and fines. The Future Generations VCT Board is reliant on Octopus and third parties to take appropriate measures to prevent a loss of confidential customer information.	Annual due diligence is conducted on third parties which includes a review of their controls for information security. Octopus has a dedicated Information Security team and a third party is engaged to provide continual protection in this area. A security framework is in place to help prevent malicious events. The appropriateness of mitigants in place are continuously reassessed to adapt to new risk exposures, such as those posed by artificial intelligence.	No overall change on balance, although cyber threat remains a significant risk area faced by all providers.
*Risk*	*Mitigation*	*Change*
Economic:
Events such as an economic recession, movement in interest rates, inflation and rising living costs could adversely affect some smaller companies’ valuations, as they may be more vulnerable to changes in trading conditions of the sectors in which they operate. This could result in a reduction in the value of Future Generations VCT assets.	Future Generations VCT aims to invest in a diverse portfolio of companies, across a range of sectors, which helps to mitigate against the impact on any one sector. Future Generations VCT also maintains adequate liquidity to make sure that it can continue to provide follow‑on investment to those portfolio companies which require it and which are supported by the individual investment case.	Increased exposures reflected in the previous periods remain as economic uncertainty persists through high inflation, high interest rates and other economic factors.
*Risk*	*Mitigation*	*Change*
Legislative:
A change to the VCT regulations could adversely impact Future Generations VCT by restricting the companies Future Generations VCT can invest in under its current strategy. Similarly, changes to VCT tax reliefs for investors could make VCTs less attractive and impact Future Generations VCT’s ability to raise further funds.	The Portfolio Manager engages with HM Treasury and industry bodies to demonstrate the positive benefits of VCTs in terms of growing early-stage companies, creating jobs and increasing tax revenue, and to help shape any change to VCT legislation.	Risk exposure has reduced following the extension of the sunset clause to 2035 being agreed.
*Risk*	*Mitigation*	*Change*
Liquidity:
The risk that Future Generations VCT’s available cash will not be sufficient to meet its financial obligations. Future Generations VCT invests into smaller unquoted companies, which are inherently illiquid as there is no readily available market for these shares. Therefore, these may be difficult to realise for their fair market value at short notice.	Future Generations VCT’s liquidity risk is managed on a continuing basis by Octopus in accordance with policies and procedures agreed by the Board. Future Generations VCT’s overall liquidity risks are monitored on a quarterly basis by the Board, with frequent budgeting and close monitoring of available cash resources. Future Generations VCT maintains sufficient investments in cash and readily realisable securities to meet its financial obligations. At 31 December 2024, these resources were valued at £20,084,000.	Risk exposures continue to increase, reflecting the potential knock-on effects of economic uncertainty, impacting fundraising and increasing the risk of disposal failure.

Viability statement

In accordance with the FRC UK Corporate Governance Code published in 2018 and provision 36 of the AIC Code of Corporate Governance, the Directors have assessed the prospects of Future Generations VCT over a period of five years, consistent with the expected investment holding period of an investor. A fundraise with an initial offer to raise up to £5 million was launched on 3 February 2025. The offer closed for new applications on 1 April 2025 for the 2024/2025 tax year having successfully raised £5 million. Under VCT rules, subscribing investors are required to hold their investment for a five‑year period in order to benefit from the associated tax reliefs. The Board regularly considers strategy, including investor demand for Future Generations VCT’s shares, and a five-year period is considered to be a reasonable time horizon for this.

The Board carried out a robust assessment of the emerging and principal risks facing Future Generations VCT and its current position. This includes risks which may adversely impact its business model, future performance, solvency or liquidity, and focused on the major factors which affect the economic, regulatory and political environment. Particular consideration was given to the Company’s reliance on, and close working relationship with, the Investment Manager. The principal risks faced by the Company and the procedures in place to monitor and mitigate them are set out above.

The Board has carried out robust stress testing of cash flows, which included assessing the resilience of portfolio companies, including the requirement for any future financial support.

The Board has additionally considered the ability of Future Generations VCT to comply with the ongoing conditions to make sure it maintains its VCT qualifying status under its current Investment policy.

Based on this assessment, the Board confirms that it has a reasonable expectation that Future Generations VCT will be able to continue in operation and meet its liabilities as they fall due over the five-year period to 31 December 2029. The Board is mindful of the ongoing risks and will continue to make sure that appropriate safeguards are in place, in addition to monitoring the cash flow forecasts to make sure Future Generations VCT has sufficient liquidity.

Directors’ responsibilities statement

The Directors are responsible for preparing the Strategic Report, the Directors’ Report, the Directors’ Remuneration Report and the Financial Statements in accordance with applicable law and regulations. They are also responsible for ensuring that the annual report and financial statements include information required by the UK Listing Rules of the Financial Conduct Authority.

Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (GAAP), including Financial Reporting Standard 102 – The Financial Reporting Standard Applicable in the United Kingdom and Republic of Ireland (FRS 102), United Kingdom accounting standards and applicable law. Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs and profit or loss of the Company for that period. In preparing these financial statements, the Directors are required to:

select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
state whether applicable UK accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business; and
prepare a Strategic Report, Directors’ Report and Directors’ Remuneration Report which comply with the requirements of the Companies Act 2006.

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company’s transactions and disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

In so far as each of the Directors is aware:

there is no relevant audit information of which the Company’s auditor is unaware; and
the Directors have taken all steps that they ought to have taken to make themselves aware of any relevant audit information and to establish that the auditor is aware of that information.

The Directors are responsible for preparing the annual report and financial statements in accordance with applicable law and regulations. Having taken advice from the Audit Committee, the Directors are of the opinion that this report as a whole provides the necessary information to assess the Company’s performance, business model and strategy and is fair, balanced and understandable.

The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company’s website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

The Directors confirm that, to the best of their knowledge:

the financial statements, prepared in accordance with United Kingdom Generally Accepted Accounting Practice, including FRS 102, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company; and
the annual report and financial statements (including the Strategic Report), give a fair review of the development and performance of the business and the position of the Company, together with a description of the principal risks and uncertainties that it faces.

On behalf of the Board

Helen Sinclair
Chair

Income statement

	18 months to 31 December 2024			Year to 30 June 2023
	Revenue	Capital	Total	Revenue	Capital	Total
	£’000	£’000	£’000	£’000	£’000	£’000
Gain on disposal of fixed asset investments	—	1,382	1,382	—	—	—
Net loss on valuation of fixed asset investments	—	(3,564)	(3,564)	—	(6)	(6)
Investment management fee	(345)	(1,035)	(1,380)	(174)	(522)	(696)
Investment income	1,427	—	1,427	424	—	424
Other expenses	(759)	—	(759)	(500)	—	(500)
Earnings/(loss) before tax	323	(3,217)	(2,894)	(250)	(528)	(778)
Tax	—	—	—	—	—	—
Earnings/(loss) after tax	323	(3,217)	(2,894)	(250)	(528)	(778)
Earnings/(loss) per share – basic and diluted	0.6p	(6.3)p	(5.7)p	(0.6)p	(1.3)p	(1.9)p

The ‘Total’ column of this statement is the profit and loss account of Future Generations VCT; the supplementary revenue return and capital return columns have been prepared under guidance published by the Association of Investment Companies.
All revenue and capital items in the above statement derive from continuing operations.
Future Generations VCT has only one class of business and derives its income from investments made in shares and securities and from bank and money market funds.

Future Generations VCT has no other comprehensive income for the period.

The accompanying notes form an integral part of the financial statements.

Balance sheet

	As at 31 December 2024		As at 30 June 2023
	£’000	£’000	£’000	£’000
Fixed asset investments		26,769		24,895
Current assets:
Debtors	1,166		379
Applications cash¹	100		370
Cash at bank	112		152
Money market funds	19,972		20,140
		21,350		21,041
Creditors: amounts falling due within one year	(196)		(518)
Net current assets		21,154		20,523
Net assets		47,923		45,418
Share capital		54		48
Share premium		51,854		46,461
Capital reserve realised		(328)		(640)
Capital reserve unrealised		(3,526)		3
Revenue reserve		(131)		(454)
Total equity shareholders’ funds		47,923		45,418
NAV per share		88.8p		94.3p

Cash received from investors but not yet allotted.

The accompanying notes form an integral part of the financial statements.

The statements were approved by the Directors and authorised for issue on 28 April 2025 and are signed on their behalf by:

Helen Sinclair
Chair
Company No: 13750143

Statement of changes in equity

	Share capital £’000	Share premium £’000	Capital reserve realised¹ £’000	Capital reserve unrealised £’000	Revenue reserve¹ £’000	Total £’000
As at 1 July 2023	48	46,461	(640)	3	(454)	45,418
Comprehensive income for the period:
Management fees allocated as capital expenditure	—	—	(1,035)	—	—	(1,035)
Current year gain on disposal of fixed asset investments	—	—	1,382	—	—	1,382
Net loss on fair value of fixed asset investments	—	—	—	(3,564)	—	(3,564)
Gain after tax	—	—	—	—	323	323
Total comprehensive loss for the period	—	—	347	(3,564)	323	(2,894)
Contributions by and distributions to owners:
Share issue	6	5,506	—	—	—	5,512
Share issue costs	—	(113)	—	—	—	(113)
Total contributions by and distributions to owners	6	5,393	—	—	—	5,399
Other movements:
Prior year fixed asset loss unrealised	—	—	(35)	35	—	—
Total other movements	—	—	(35)	35	—	—
Balance as at 31 December 2024	54	51,854	(328)	(3,526)	(131)	47,923

	Share capital £’000	Share premium £’000	Capital reserve realised¹ £’000	Capital reserve unrealised £’000	Revenue reserve¹ £’000	Total £’000
As at 1 July 2022	33	31,572	(118)	9	(204)	31,292
Comprehensive income for the period:
Management fees allocated as capital expenditure	—	—	(522)	—	—	(522)
Net loss on fair value of fixed asset investments	—	—	—	(6)	—	(6)
Loss after tax	—	—	—	—	(250)	(250)
Total comprehensive loss for the period	—	—	(522)	(6)	(250)	(778)
Contributions by and distributions to owners:
Shares issued	15	15,164	—	—	—	15,179
Share issue costs	—	(275)	—	—	—	(275)
Total contributions by and distributions to owners	15	14,889	—	—	—	14,904
Balance as at 30 June 2023	48	46,461	(640)	3	(454)	45,418

Reserves are available for distribution, subject to the restrictions.

The accompanying notes form an integral part of the financial statements.

Cash flow statement

	18 months to 31 December	Year to 30 June
	2024	2023
	£’000	£’000
Cash flows from operating activities
Loss before tax¹	(2,894)	(778)
Decrease/(increase) in debtors	173	(325)
Decrease in creditors	(52)	(103)
Gain on disposal of fixed assets	(1,382)	—
Loss on valuation of fixed asset investments	3,564	6
Outflow from operating activities	(591)	(1,200)
Cash flows from investing activities
Purchase of fixed asset investments	(8,162)	(23,238)
Sale of fixed asset investments	3,146	—
Outflow from investing activities	(5,016)	(23,238)
Cash flows from financing activities
Movement in applications account	(270)	(1,544)
Proceeds from share issues	5,512	15,179
Share issue costs	(113)	(275)
Inflow from financing activities	5,129	13,360
Decrease in cash and cash equivalents	(478)	(11,079)
Opening cash and cash equivalents	20,662	31,741
Closing cash and cash equivalents	20,184	20,662
Cash and cash equivalents comprise
Cash at bank	112	152
Money market funds	19,972	20,140
Applications cash	100	370
Closing cash and cash equivalents	20,184	20,662

Loss before tax includes cashflows from dividends of £1.4 million (2023: £0.4 million).

The accompanying notes form an integral part of the financial statements.

Notes to the financial statements

1. Principal accounting policies

Octopus Future Generations VCT plc (‘Future Generations VCT’) is a Public Limited Company (plc) incorporated in England and Wales and its registered office is at 6th Floor, 33 Holborn, London EC1N 2HT.

Future Generations VCT has been approved as a Venture Capital Trust by HMRC under Section 259 of the Income Taxes Act 2007. The shares of Future Generations VCT were first admitted to the Official List of the UK Listing Authority and trading on the London Stock Exchange on 5 April 2022 and can be found under the TIDM code OFG. Future Generations VCT is premium listed.

The principal activity of Future Generations VCT is to invest in a diversified portfolio of UK smaller companies in order to generate capital growth over the long term as well as an attractive tax-free dividend stream.

The financial statements are presented in GBP (£) to the nearest £’000. The functional currency is also GBP (£). Some accounting policies have been disclosed in the respective notes to the financial statements.

Basis of preparation
The financial statements have been prepared on a going concern basis under the historical cost convention, except for the measurement at fair value of certain financial instruments, and in accordance with UK Generally Accepted Accounting Practice (GAAP), including Financial Reporting Standard 102 – ‘The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland’ (FRS 102), the Companies Act 2006 and the Statement of Recommended Practice (SORP) ‘Financial Statements of Investment Trust Companies and Venture Capital Trusts (July 2022)’.

2. Investment income
Accounting policy

Investment income comprises interest earned on money market funds. Dividend income is shown net of any related tax credit. Dividends receivable are brought into account when Future Generation’s right to receive payment is established and there is no reasonable doubt that payment will be received. Fixed returns on debt and money market funds are recognised so as to reflect the effective interest rate, provided there is no reasonable doubt that payment will be received in due course.

Disclosure

	18 months to
	31 December 2024	30 June 2023
	£’000	£’000
Money market funds	1,427	424
Total investment income	1,427	424

3. Investment management fees
Accounting policy

For the purposes of the revenue and capital columns in the Income Statement, the management fee has been allocated 25% to revenue and 75% to capital, in line with the Board’s expected long-term return in the form of income and capital gains respectively from Future Generations VCT’s investment portfolio.

Disclosure

	18 months to 31 December 2024			Year to 30 June 2023
	Revenue	Capital	Total	Revenue	Capital	Total
	£’000	£’000	£’000	£’000	£’000	£’000
Investment
management fee	345	1,035	1,380	174	522	696
Total	345	1,035	1,380	174	522	696

The Portfolio Manager provides investment management services through agreements with Octopus AIF Management Limited and Future Generations VCT. It also provides accounting and administration services to Future Generations VCT under a Non-Investment Services Agreement (NISA). No compensation is payable if the agreement is terminated by either party, if the required notice period is given. The fee payable, should insufficient notice be given, will be equal to the fee that would have been paid should continuous service be provided, or the required notice period was given.

4. Other expenses
Accounting policy

Other expenses are accounted for on an accruals basis and are charged wholly to revenue.

The transaction costs incurred when purchasing or selling assets are written off to the Income Statement in the period that they occur.

	18 months to	Year to
	31 December	30 June
	2024	2023
	£’000	£’000
NISA fees	213	122
Directors’ remuneration¹	157	77
Audit fees²	78	63
Directors and Officers (D&O) insurance	74	15
Depositary fees	62	57
Listing fees	46	58
Registrars fees	28	21
Director recruitment & expenses	27	—
Report and account fees	26	38
Other fees	48	49
Total	759	500

1. Includes employers’ NI.
2. Includes VAT.

Total ongoing charges are capped at 3.0% of net assets. For the period to 31 December 2024, the ongoing charges exceeded this cap and a rebate was paid from the Portfolio Manager for the amount of £39,000. For the 18 months to 31 December 2024 the ongoing charges were 3.0% (2023: 3.0%) of net assets. This is calculated by summing the annualised expenses incurred in the period (excluding non-recurring expenses) divided by the average NAV throughout the period.

5. Tax on ordinary activities
Accounting policy

Corporation tax payable is applied to profits chargeable to corporation tax, if any, at the current rate. The tax effect of different items of income/gain and expenditure/loss is allocated between capital and revenue return on the ‘marginal’ basis as recommended in the SORP.

Deferred tax is recognised in respect of all timing differences at the reporting date. Timing differences are differences between taxable profits and total income as stated in the financial statements that arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements.

Disclosure
The corporation tax charge for the period was £nil.

	18 months to	Year to
	31 December	30 June
	2024	2023
	£’000	£’000
Loss on ordinary activities before tax	(2,894)	(778)
Current tax at 25% (2023: 20.5%)	(724)	(159)
Effects of:
Non-taxable income	(357)	—
Non-taxable capital gains	546	1
Non-deductible expenses	1	—
Excess management expenses on which deferred tax not recognised	534	193
Tax rate differences¹	—	(35)
Total current tax charge	—	—

1. Tax rate difference due to tax charge for the period being calculated at 20.5% and excess management expenses on which deferred tax is not recognised being calculated at 25%.

Unrelieved tax losses of £3,231,000 (2023: £1,094,000) are estimated to be carried forward at 31 December 2024 (subject to completion of Future Generations VCT’s tax return) and are available for offset against future taxable income, subject to agreement with HMRC. Future Generations VCT has not recognised the deferred tax asset of £808,000 (2023: £273,000) in respect of these tax losses because there is insufficient forecast taxable income in excess of deductible expenses to utilise these losses carried forward.

Approved VCTs are exempt from tax on capital gains. As the Directors intend for Future Generations VCT to continue to maintain its approval as a VCT through its affairs, no current deferred tax has been recognised in respect of any capital gains or losses arising on the revaluation or disposal of investment.

6. (Loss)/earnings per share

	18 months to 31 December 2024			Year to 30 June 2023
	Revenue	Capital	Total	Revenue	Capital	Total
	£’000	£’000	£’000	£’000	£’000	£’000
Earnings/(loss) attributable to Ordinary shareholders (£’000)	323	(3,217)	(2,894)	(250)	(528)	(778)
Earnings/(loss) per Ordinary share (p)	0.6	(6.3)	(5.7)	(0.6)	(1.3)	(1.9)

The Earnings/(loss) per share is based on 51,727,417 (2023: 40,987,788) Ordinary shares, being the weighted average number of Ordinary shares in issue during the period.

There are no potentially dilutive capital instruments in issue and so no diluted return per share figures are relevant. The basic and diluted earnings per share are therefore identical.

7. Net asset value per share

	31 December	30 June
	2024	2023
Net assets (£’000)	47,923	45,418
Shares in issue	53,941,104	48,138,337
NAV per share (p)	88.8	94.3

8. Transactions with the Manager and Portfolio Manager

Future Generations VCT is classified as a full-scope Alternative Investment Fund under the Alternative Investment Fund Management Directive (the ‘AIFM Directive’). Future Generations VCT has appointed Octopus AIF Management Limited to provide the services of an AIFM of a full-scope AIF. In accordance with its power to do so under AIFMD, Octopus AIF Management Limited has delegated investment management to Octopus Investments Limited, whilst retaining the obligations of a risk manager.

Future Generations VCT paid Octopus AIF Management Limited £1,380,000 (2023: £696,000) in the period as a management fee, after applying a rebate to maintain the total ongoing charges below the 3% cap. The annual management charge (AMC) is based on 2% of Future Generations VCT’s NAV. The AMC is payable quarterly in advance and calculated using the latest published NAV of Future Generations VCT and the number of shares in issue at each quarter end. Once the quarter has ended, an adjustment will be made if the NAV at the end of the current quarter is calculated and which differs from the NAV as at the end of the previous quarter. The Manager will donate 10% of the management fee to the Octopus Giving Charitable Foundation, which was set up in 2014 to help charities make the world a better place and which, since inception, has donated more than £1 million to such worthy causes.

Octopus also provides Non-Investment Services to Future Generations VCT, payable quarterly in advance. The fee is 0.3% of Future Generations VCT’s NAV, calculated at quarterly intervals. The NISA fee is calculated using the latest published NAV of Future Generations VCT and the number of shares in issue at each quarter end. As with the AMC, an adjustment will be made once the quarter has ended if the NAV at the end of the current quarter is calculated and which differs from the NAV as at the end of the previous quarter. During the period £213,000 (2023: £122,000) was paid to Octopus for Non‑Investment Services. In addition, Octopus is entitled to performance-related incentive fees, subject to Future Generations VCT’s total return at year end exceeding the total return at the previous year end when an incentive fee was paid, or 97p if the first incentive fee has not yet been paid (the ‘Excess’), equal to 20% of the Excess. No performance fee will be paid prior to the financial year ending on 31 December 2025, dividends (paid or declared) being equal to or greater than 10p per Ordinary share and the total return exceeding 120p.

The cap relating to Future Generations VCT’s total expense ratio, that is the regular, recurring costs of Future Generations VCT expressed as a percentage of its NAV, above which Octopus has agreed to pay, is 3.0%, and is calculated in accordance with the AIC Guidelines.

Octopus AIF Management Limited remuneration disclosures (unaudited)
Quantitative remuneration disclosures required to be made in this annual report in accordance with the FCA Handbook FUND 3.3.5 are available on the website: https://www.octopusinvestments.com/remuneration-disclosures/.

9. Related party transactions

Several members of the Octopus investment team hold non-executive directorships as part of their monitoring roles in Future Generations VCT’s portfolio companies, but they have no controlling interests in those companies.

Emma Davies, a Non-Executive Director of Future Generations VCT, previously held the role of co-CEO of Octopus Ventures and she also holds shares in Octopus Capital Ltd. On 24 March 2023, Emma Davies ceased to be employed by Octopus Capital Limited and therefore she is no longer considered a related party. Emma retired as a Non-Executive Director of Future Generations VCT on 31 March 2024. No dividends have been paid to the Directors of Future Generations VCT in the period (2023: £nil).

10. 2024 financial information

The figures and financial information for the period ended 31 December 2024 are extracted from the Company’s annual financial statements for the period and do not constitute statutory accounts. The Company’s annual financial statements for the period to 31 December 2024 have been audited but have not yet been delivered to the Registrar of Companies. The Auditors’ report on the 2024 annual financial statements was unqualified, did not include a reference to any matter to which the auditors drew attention without qualifying the report, and did not contain any statements under Sections 498(2) or 498(3) of the Companies Act 2006.

11. 2023 financial information

The figures and financial information for the year ended 30 June 2023 are compiled from an extract of the published financial statements for the period and do not constitute statutory accounts. Those financial statements have been delivered to the Registrar of Companies and included the Auditors’ report which was unqualified, did not include a reference to any matter to which the auditors drew attention without qualifying the report, and did not contain any statements under Sections 498(2) or 498(3) of the Companies Act 2006.

12. Annual Report and financial statements
The Annual Report and financial statements will be posted to shareholders in early May and will be available on the Company’s website, https://octopusinvestments.com/our-products/venture-capital-trusts/octopus-future-generations-vct/.
The Notice of Annual General Meeting is contained within the Annual Report.

13. General information

Registered in England & Wales. Company No. 13750143
LEI: 213800AL71Z7N2O58N66

14. Directors

Helen Sinclair (Chair), Joanna Santinon and Ajay Chowdhury

15. Secretary and registered office

Octopus Company Secretarial Services Limited
6^th Floor, 33 Holborn, London EC1N 2HT

The MIL Network –

April 29, 2025

MIL-OSI: Annual report and financial statements for the year ended 31 December 2024

Source: GlobeNewswire (MIL-OSI)

OCTOPUS TITAN VCT PLC

Annual report and financial statements for the year ended 31 December 2024

Octopus Titan VCT plc announces the final results for the year to 31 December 2024 as below.

Octopus Titan VCT plc (‘Titan’ or the ‘Company’) is managed by Octopus AIF Management Limited (the ‘Manager’), which has delegated investment management to Octopus Investments Limited (‘Octopus’ or ‘Portfolio Manager’) via its investment team Octopus Ventures.

Key financials

	2024	2023
Net assets (£’000)	£831,358	£993,744
Loss after tax (£’000)	£(147,649)	£(149,499)
NAV per share	50.5p	62.4p
Total value per share¹	155.6p	164.4p
Total return per share²	(8.8)p	(9.5)p
Total return per share %³	(14.1)%	(12.4)%
Dividends paid in the year	3.1p	5.0p
Dividend yield %⁴	5.0%	6.5%
Dividend declared	0.5p	1.9p

Total value per share is an alternative performance measure, calculated as NAV plus cumulative dividends paid since launch, as described in the glossary of terms.
Total return per share is an alternative performance measure, calculated as movement in NAV per share in the period plus dividends paid in the period, as described in the glossary of terms.
Total return % is an alternative performance measure, calculated as total return/opening NAV, as described in the glossary of terms.
Dividend yield is an alternative performance measure, calculated as dividends paid/opening NAV, as described in the glossary of terms.

Chair’s statement
Titan’s total return for the year to 31 December 2024 was -14.1% with net assets at the end of the period totalling £831 million.

The Net Asset Value (NAV) per share at 31 December 2024 was 50.5p which, adjusting for dividends paid in the year, represents a net decrease of 8.8p per share from 31 December 2023 or a total return of –14.1%.

This further decline in value has been driven by several factors, including company-specific performance issues and tougher trading conditions, which have reduced revenue growth across a range of sectors. As a result, many companies in the portfolio have not met performance expectations, leading to lower valuation multiples being applied compared to those at recent points of investment. This situation has been exacerbated by a continued slow private market fundraising environment, leading to more limited capital availability. Consequently, companies have prioritised extending their cash runway, aiming to achieve profitability or delay fundraising until market conditions improve. In the short term, this has led to reduced valuations due to slower growth, but in the long run, the disciplined focus on sustainable growth should be beneficial.

With this further decline in NAV, the 5-year tax-free annual compound return for shareholders is now -3.5%. Since the high watermark as at 31 December 2021, Titan’s total return per share has been –39.8% with which the Board and Manager are, and shareholders will be, deeply disappointed. The scale of shareholder dissatisfaction has been made abundantly clear following the recently conducted survey.

In the 12 months to 31 December 2024, the Company utilised £137 million of its cash resources, comprising £30 million in new and follow-on investments, £44 million in dividends (net of the Dividend Reinvestment Scheme (DRIS)), £38 million in share buybacks and £25 million in annual investment management fees and other running costs. The cash and corporate bond balance of £184 million at 31 December 2024 represented 22% of net assets at that date, compared to 20% at 31 December 2023.

The total value (NAV plus cumulative dividends paid per share since launch) at the end of the period was 155.6p (31 December 2023: 164.4p). Titan’s one-year total return of -8.8p (-14.1%) five-year total return of -15.6p (-16.4%) and ten-year total return of 6.7p (6.6%) evidences the disappointing decline in performance in recent years.

Strategic Review

As shareholders will be aware, in the half-yearly report issued at the end of September 2024, we announced a review of strategy to ensure a thorough retrospective analysis took place and a plan be drawn up for how the Company can be best structured for sustainability and improved performance in the future. A significant amount of work has been undertaken by Octopus and our appointed external advisers, Smith Square Partners LLP, across a number of different workstreams. This includes a detailed analysis of historical investment performance, ongoing sustainability, the forward-looking pipeline for realisations, future investment strategy, investment team resources and, finally, investment manager’s culture and governance. The significant performance challenges and the early-stage nature of much of the portfolio mean that it will take some time for changes to have an impact on performance and a longer-term approach to shaping the future of the Company is needed. We are making reasonably good progress, and more can be read about the steps which have been taken in the Spotlight section. The response to our shareholder survey is included below. From this it is clear that there is widespread and deep dissatisfaction with the past performance of Titan, both in absolute and relative terms and an understandable frustration with the lack of capital growth in recent years. The Board also acknowledges the recent press coverage, particularly in respect of shareholders’ views on the fees that Titan pays. We would like to thank those that participated in the survey, as well as those that have provided their feedback to both the Board and Octopus. The Board wishes to assure shareholders that it is considering the results and feedback alongside the review.

We expect to provide a further update on the review at, or prior to, our Annual General Meeting (AGM) on 19 June 2025. However, we do not anticipate the process to be completed by this point, so any proposals for the future of the Company will likely be put to shareholders at a later date.

Performance incentive fees
As the 2024 total return has been negative, and total value per share has declined since 31 December 2021, no performance fee is payable. To remind you, the performance fee is calculated as 20% on net gains above the high-water mark (the highest total value per share as at previous year ends), which is currently set as 197.7p as at 31 December 2021.

Dividends
Following careful consideration and recognising the value that shareholders’ place on receiving tax-free dividends, I am pleased to confirm that the Board has decided to declare a second interim dividend of 0.5p per share (2023: 1.9p per share). This will be paid on 29 May 2025 to shareholders on the register as at 25 April 2025. This second interim dividend, in addition to the 1.2p per share interim dividend paid in December 2024 brings the total dividends declared to 1.7p per share in respect of 2024. However, this 0.5p per share dividend is lower than that paid in previous years because of the ongoing performance challenges and dividends are typically a distribution of achieved performance. Considering dividends paid during 2024 (totalling 3.1p), the total dividend yield for the year is 5%, therefore meeting the Company’s target.

Dividends, whether paid in cash or reinvested under the DRIS, are always at the discretion of the Board, are never guaranteed, and are subject to regular review reflecting the returns generated by the Company, the timing of investment realisations, cash and distributable reserves and continuing compliance with VCT rules.

The Board will consider any further dividends to be paid in 2025 in the second half of the year at, or around, the release of the interim accounts for the six months ending 30 June 2025, subject to Titan’s performance, both realised and unrealised, improving and, as ever, Titan holding sufficient cash reserves.

As with the dividend paid to shareholders on 19 December 2024, and in light of the ongoing review of Titan’s strategy, the Board continues to suspend the Company’s dividend reinvestment scheme for the dividend to be paid on 29 May 2025, with the dividend being paid to shareholders in cash.

Fundraise and buybacks
We were pleased to raise over £107 million in the fundraise which closed on 5 April 2024. As stated in the half-yearly review, the Board will decide on the approach to future fundraising at the conclusion of the review of strategy.

During the year, Titan repurchased 67 million shares for £38 million (representing 4.2% of the net asset value as at 31 December 2023). Further details can be found in Note 14 of the financial statements. Details of the share buybacks undertaken during the year can be found in the Directors’ Report.

VCT status
In November 2023, a ten-year extension was announced to the ‘sunset clause’ (a retirement date for the VCT scheme), meaning VCT tax reliefs will be available until 5 April 2035. This extension passed through Parliament in February 2024 and on 3 September 2024, His Majesty’s Treasury brought the extension into effect through The Finance Act 2024. The Board is delighted that this has brought clarity to the status of VCTs.

Board of Directors
Rupert Dickinson was appointed to the Board with effect from 1 May 2024 and was elected by shareholders at the AGM held in June 2024. Rupert has over 20 years’ experience in the wealth and investment management industries. We are already benefitting from his extensive experience.

All the other Directors have indicated their willingness to remain on the Board, and Jane O’Riordan and Lord Rockley will be seeking re-election at the AGM.

Portfolio Manager and team
In March 2024, Malcolm Ferguson, Octopus’ lead Fund Manager for Titan, resigned and Jo Oliver was appointed as lead Fund Manager and Adviser to the Board on fund and strategy on an interim basis. In August 2024, Jo stepped down from this interim role. We wish to take this opportunity to thank both Jo and Malcolm for their contributions to the Company and wish them well for the future. We are pleased that, despite Malcolm’s resignation, he continues to support with portfolio management on a contractual basis. The process to appoint a replacement lead Fund Manager will commence once the review of strategy is completed.

Shareholders may be aware that there has been considerable turnover over the past twelve months in the Octopus Ventures team, which is responsible for managing Titan. As part of the on-going strategic review, Octopus is assessing the team structure, size, culture and experience to ensure it is aligned with its future investment strategy proposals. In the interim, the Octopus Ventures team is receiving additional senior support from across the business to ensure adequate resources are available.

AGM and shareholder event
The AGM will take place on 19 June 2025 from 12.00 noon and will be held at the offices of Octopus Investments Limited, 33 Holborn, London, EC1N 2HT. Full details of the business to be conducted at the AGM are given in the Notice of AGM.

Shareholders’ views are important, and the Board encourages shareholders to vote on the resolutions within the Notice of AGM using the proxy form, or electronically at www.investorcentre.co.uk/eproxy. Shareholders are invited to send any questions they may have via email to TitanAGM@octopusinvestments.com. The Board has carefully considered the business to be approved at the AGM and recommends shareholders to vote in favour of all the resolutions being proposed, as the Board will be doing.

Currently, we do not anticipate the strategic review process will have been fully completed by the date of the AGM. As a result, we will issue a further communication to shareholders in due course setting a date for a shareholder event and, if applicable, a General Meeting at which shareholders will be able to vote on any proposals for the future direction of the Company.

Outlook
The further decline in NAV to 31 December 2024 is extremely disappointing, especially when set against the backdrop of the recent recovery of some of the comparable markets and other VCTs. This decline has been primarily driven by specific portfolio performance issues and sectoral downturns, leading to cash constraints exacerbated by a challenging fundraising environment. Some portfolio companies attempted to raise funds but were unsuccessful, resulting in several being placed into administration or accepting acquisition offers on unfavourable terms. More details on these disposals can be found in the Portfolio Manager’s review. Others had to complete funding rounds at lower valuations or in ways that negatively impacted the value of the Company’s shareholding.

The Company returned £29 million in cash proceeds from exits in 2024, in addition to £12.4 million distributed from Zenith Holding Company to Titan. This is a disappointing outcome as it is below the level achieved in 2023, and does not accomplish the Company’s long-term sustainability target. Despite the Manager’s initiatives to increase the number of realisations of portfolio companies and return cash proceeds to Titan, we have not yet seen any profitable realisations in 2025. This sustained focus on achieving regular liquidity is an important step towards ensuring the ongoing sustainability of the Company.

Despite this, the Board retains a degree of optimism about the potential of some of the companies within what is undoubtedly a diversified portfolio, with over 135 companies spanning a wide range of sectors, business models and investment stages. Furthermore, Titan’s portfolio remains well funded with circa 42% of the portfolio NAV being comprised of companies not expecting to need further funding. This figure rises to 67% when including those companies with more than 12 months’ cash runway.

I would like to conclude by thanking both the Board and the Octopus team on behalf of all shareholders for their hard work during this very challenging period.

Tom Leader
Chair

Spotlight on the review of strategy

On 30 September 2024, the Board, in conjunction with the Manager, announced a strategic review. This was catalysed by the ongoing challenges in the early-stage venture market to which the Company is exposed and the resultant performance issues faced. Since this date, the Board and Manager have undertaken numerous actions to identify the areas of focus and potential changes which could be made to drive the best performance for the Company and outcome for shareholders. Below is a summary of the steps taken to date by both the Board and Manager.

Date	Investment Manager’s actions	Titan VCT Board’s actions	Board meetings held
Sep 2024		Announcement of review of strategy.	Four Board meetings
Oct 2024	Establish internal review committee comprised of different areas of the business. Co-ordinating information packs for the external advisers.	External adviser selection process concluded and terms agreed.
Nov 2024	Recruitment process for senior Portfolio Management roles commences. Internal review committee submits scope of work to the Board.	External advisers, Smith Square Partners, appointed. Board reviews Octopus’ scope of work.	Two Board meetings
Dec 2024	Internal review committee submits information pack on sustainability and fund performance workstreams to the Board.	Shareholder and adviser survey launched. Board reviews information pack on sustainability and fund performance. Board reviews external advisers’ analysis of performance and benchmarking.	One Board meeting
Jan 2025	Survey results analysed. External specialists commence review of Consumer Duty. Internal review committee submits information pack on team and culture and risk and governance work streams to the Board.	Board reviews external advisers’ progress report including analysis of the realisations pipeline. Board reviews information pack on team and culture and risk and governance work streams. Survey results analysed.	Two Board meetings
Feb 2025	Internal review committee presents first part of the go-forward investment strategy and further sustainability analysis and metrics.	Board reviews go‑forward strategy and sustainability analysis and metrics.	One Board meeting
Mar 2025	Results of Consumer Duty Review analysed.	Board reviews external advisers’ progress report. Results of Consumer Duty Review analysed. Unaudited NAV released with update on progress of review.	Two Board meetings
Apr 2025	Internal review committee presents follow up detail on the go-forward investment strategy, as well as proposals for future team and resourcing plan. Proposal submitted to Board regarding ongoing fees.	External advisers’ interim report shared with the Board. Annual report published. Board considers proposal on future team and resourcing strategy and fees. Board commences fee negotiations with Octopus.	Two Board meetings

Summary of the Manager’s internal review workstreams:

1. Fund performance
Working to understand the most appropriate investment and divestment strategy looking at past performance metrics, benchmarks and future objectives.

2. Fund strategy
Investigating potential future options for Titan’s strategy which could drive improved performance. Some potential options were included in the shareholder survey to canvas views.

3. Sustainability
Working on past performance and future forecasting to ensure Titan operates sustainably, returning funds through realisations.

4. Team & culture
Reviewing the team structure, size, culture and experience (past and present) and how it maps to the successful management of the Company. Full Octopus Ventures strategy refresh in line with new Chief Executive Officer (CEO) Erin Platts joining.

5. Consumer Duty
External consultants appointed to carry out a review of Consumer Duty. This is to understand shareholders’ expected outcomes and assessing how the Company has delivered against them.

6. Risk & governance
Work led by the compliance team updating Titan’s risk register. Review and enhancement of governance processes and procedures, where relevant.

What’s next
1. Final Smith Square Partners report presented to the Board.
2. Finalise fee proposal, as well as review of the Investment Management Agreement and Non-Investment Services Agreement.

Octopus Ventures’ new CEO

Erin Platts joined Octopus Ventures as CEO in January 2025.

Previously, she held the role of CEO at HSBC Innovation Banking UK, formerly Silicon Valley Bank UK & EMEA. Over two decades in leadership roles with the institution, she established Silicon Valley Bank UK as a standalone, regulated subsidiary before leading the organisation through the transition period following its sale to HSBC in 2023, scaling operations to over 800 people, across six countries and into the market leading position across the sector.

With a career spent in the US, UK and European tech ecosystems, Erin is an active and vocal spokesperson, championing Diversity, Equity and Inclusion through partnerships with organisations including Tech Nation, Founders Forum and the Newton Venture Program.

Portfolio Manager’s review

At Octopus, our focus is on managing your investments and providing open communication. Our annual and half-year updates are designed to keep you informed about the progress of your investment.

Focus on performance
The NAV of 50.5p per share at 31 December 2024 represents a decrease in NAV of 8.8p per share versus a NAV of 62.4p per share as at 31 December 2023, after adding back dividends paid during the year of 3.1p (2023: 5p) per share, a negative total return per share of 14.1% in the year.

The performance over the five years to 31 December 2024 is shown below:

	Year ended	Year ended	Year ended	Year ended	Year ended
	31 December	31 December	31 December	31 December	31 December
	2020	2021	2022	2023	2024
NAV, p	97.0	105.7	76.9	62.4	50.5
Cumulative dividends paid, p	81.0	92.0	97.0	102.0	105.1
Total value, p	178.0	197.7	173.9	164.4	155.6
Total return¹	7.1%	20.3%	(22.5)%	(12.4)%	(14.1)%
Dividend yield²	5.3%	11.3%	4.7%	6.5%	5.0%

1. Total return % is an alternative performance measure, calculated as total return/opening NAV.
2. Dividend yield is an alternative performance measure, calculated as dividends paid/opening NAV.

We are deeply disappointed by the negative total return of 14.1% in 2024 which has been driven by a decline of £193 million across 72 companies. The businesses that contributed most significantly to this decline were Pelago, Many Pets and Big Health. Whilst these companies continue to look to scale, they have underperformed the high expectations set at their last funding round, and so have seen their valuations decline.

These three valuation movements account for around a third of the total decline in NAV over the twelve-month reporting period.

Octopus Ventures believes that many of the companies which have seen decreased valuations in the period have the potential to overcome the issues they face and get their growth plans back on track. Octopus Ventures continues to work with them to help them realise their potential. In some cases, the support offered could include further funding to ensure a business has the capital it needs to execute on its strategy. Our in-house Talent team is being utilised to build high-performing teams and support on key recruitment initiatives. This team, as well as our expert network of consultants, support companies on project work and can also work part-time with the businesses.

More positively, 39 companies saw an increase in valuation in the period, delivering a collective increase in valuation of £56 million. These valuation increases reflect businesses which have successfully concluded further funding rounds at increased valuations, grown revenues or met certain important milestones. Notable strong performers in the portfolio include Legl, Taster and Katkin – all of which have increased their market reach through new product launches. These strong performers demonstrate that there are opportunities available for companies to thrive, and Titan’s diverse portfolio allows different routes for each company to succeed in their market.

The gain on Titan’s uninvested cash reserves was £9.2 million in the year to 31 December 2024, primarily driven by a fair value movement of £4.4 million in the corporate bond portfolio and a return of £4.2 million on the money market funds. The objective for the money market funds is to earn appropriate market rates on highly liquid treasury holdings, with limited risk to capital.

Titan total value growth from inception
The table below highlights the compound annual growth rate across different holding periods.

Despite the reduction in NAV in the year, the total value has seen an increase since the end of Titan’s first year, from 89.9p to 155.6p at 31 December 2024. Since Titan launched, a total of over £557 million has been distributed back to shareholders in the form of tax-free dividends. This includes dividends reinvested as part of the DRIS.

Holding period	Total return	Tax-free compound annual growth rate
Since October 2008	73.1%	3.4%
10 years	6.6%	0.6%
5 years	(16.4)%	(3.5)%
1 year	(14.1)%	(14.1)%

Disposals
Disposals and deferred proceeds have returned £29 million in cash during the period. In addition, £12.4 million was distributed from Zenith Holding Company to the Company.

Exits
In June, Taxfix (a European focused tax return technology platform) acquired TaxScouts, for a combination of cash and equity, which has allowed it to enter the UK market. As a result, Titan now holds shares in Taxfix.

In July, Foodsteps was acquired by Registrar Corp (a provider of regulatory and compliance software for the food, cosmetic and life sciences industry). This transaction was also for a combination of cash and equity and has offered Registrar Corp access to Foodsteps’ global market platform of over 32,000 companies in 190 countries.

In November, Cobee was acquired by Pluxee Group (an employee benefits and engagement platform) as part of its strategic growth plan. Pluxee is a global leader in employee benefits and engagement, operating in 31 countries with over 5,000 employees. Pluxee is uniquely positioned to support Cobee’s continued growth.

In November, nCino (a cloud-based software company that provides a platform for financial institutions to manage their business lines) acquired FullCircl. This will enhance nCino’s data and automation capabilities and allow it to expand its reach across the UK and Europe.

In December, Behavox (a leading provider of AI powered archiving, compliance and security solutions) acquired Mosaic Smart Data.

Partial exits
Two partial exits completed in October with Neat (an embedded insurance platform that enables merchants to offer tailored insurance bundles to their customers at competitive rates) completing a €50 million Series A funding round, and Vitesse (a global domestic settlement and liquidity management system to hold funds and execute cross-border payments) completing a $93 million Series C investment round. As part of both of these rounds, Titan sold a portion of its shares. We are pleased to have realised some value for shareholders in these transactions, but also excited to maintain a holding in the companies and to be able to continue to support their growth journeys.

Deferred proceeds
In the year, Titan also received deferred proceeds from the sale of Calastone (to The Carlyle Group in 2020) which was held via Octopus Zenith Holding Company, iSize (to Sony Interactive Entertainment in 2023), Conversocial (to Verint), Glofox (to ABC Fitness), Comma (to Weavr) and Foodsteps (to Registrar).

Exits at a loss
There have been four disposals made at a loss: Titan sold its remaining shares in Cazoo, which was listed on the New York Stock Exchange, Unmade was acquired by High-Tech Apparel, and Titan’s shares in Appear Here were converted to deferred shares and divested, as there was not seen to be a chance of recovery of any funds. Vinter was acquired by Kaiko (a leading provider of cryptocurrency market data, analytics and indices) for equity. As a result, Titan now holds shares in Kaiko, which are currently valued below Titan’s initial cost of investment, but these will be subject to re-valuation at least twice annually as per our normal process. In aggregate, these losses generated negligible proceeds compared to an investment cost of £19 million.

Companies placed into administration
Unfortunately, Audiotelligence, Stackin (now fully dissolved), Contingent, Phoelex, Excession, Dead Happy, Pulse Platform and Allplants were placed into administration having all been unsuccessful in securing further funding and having explored and exhausted all available options. In aggregate, the investment cost of the companies placed into administration totalled £26 million.

In the year to 31 December 2024, Third Eye and LifeBook were fully dissolved having been placed into administration in previous reporting periods.

The underperformance of a portfolio company is always disappointing for Octopus and shareholders alike, but it is an inherent characteristic of a venture capital portfolio, and we believe the successful disposals will continue to outweigh the losses over the medium to long-term.

	Year ended 31 December 2020	Year ended 31 December 2021	Year ended 31 December 2022	Year ended 31 December 2023	Year ended 31 December 2024	Total
Disposal proceeds¹ (£’000)	23,915	221,504	62,213	45,637	41,432	394,701

1.This table includes cash and retention proceeds received in the period.

New and follow-on investments
Titan completed 8 new investments and made 14 follow-on investments in the reporting period. Together, these totalled £30 million (made up of £19 million into new companies and £11 million invested into the existing portfolio).

Please see a summary of some of the new investments we made in the year.

DRIFT Energy: Designing sailing vessels and routing algorithms required to capture deep water wind energy and convert it into onboard hydrogen gas for transportation back to shore.
ExpressionEdits: Using a proprietary AI algorithm to design DNA sequences and intronization technology to enhance the expression of proteins in mammalian cells.
Forefront: Developing a tuneable Radio Frequency Front-End (RFFE) module for mobile devices which is smaller, cheaper, and more flexible than currently available products sold.
LabGenius: A next-generation platform leveraging machine learning to develop novel therapeutic antibodies.
Manual: Provides innovative treatments for a range of health conditions.
Remofirst is an Employer of Record (EOR) and compliance platform that allows companies to hire and pay employees globally.
SWiiPR: Developed a digital payments platform specifically for the airline industry.

As explained in the half-yearly report, the Octopus Ventures team is focused on improving performance from the existing portfolio and driving improved returns to shareholders. Given Titan’s scale, the greatest returns are expected to be driven by its existing, largest holdings. Over the last nine months, Titan has focused on building value in its existing portfolio, allowing capital and time to be prioritised on existing companies. No term sheets for new investments have been signed since the summer of 2024. The five follow-on investments which completed in the second half of 2024 have all increased in value in the December valuation round, on average seeing an increase of 10%. We believe that this focus will drive positive future NAV performance as these portfolio companies are more established, so have a greater potential to secure further investment, or are closer to an exit.

Shareholder survey results
Octopus regularly seeks feedback from Titan’s investor and adviser base either through local Business Development Managers or after webinars with the Investment Managers. Considering the ongoing review of Titan’s strategy, which is looking at a wide range of areas such as investment strategy, fundraising and dividend policies, Octopus and the Board wanted to give investors and advisers an extra opportunity to share feedback and help shape the future strategic direction of Titan. In conjunction with an external research firm, between December 2024 and January 2025, Octopus surveyed Titan’s investor and adviser base to try to better understand investors’ priorities, areas of concern and opportunities which may be of interest.

We were pleased to see significant engagement, having received over 3,000 responses from investors and advisers. As stated in the Chair’s statement, the results emphasise that the greatest areas of dissatisfaction are around past performance and the capital growth opportunity, as highlighted below. Octopus and the Board share investors’ frustration with the recent poor performance, and have been reviewing Titan’s investment strategy with the aim to improve shareholder returns. The Board intends to communicate to investors any strategic changes once they are agreed in due course.

To understand investors’ priorities when making their investment decision we asked the following:

When you first chose to invest in Titan VCT, how important were the following factors?
The results were as follows in order of importance:

Tax reliefs available on your investment (income tax relief, tax free dividends and tax free capital gains)
5% annual target dividend
Capital growth opportunity
Past performance of fund
Access to early-stage, unlisted tech enabled companies with high growth potential
Ability to sell your shares back to the VCT via the share buyback facility
Size of fund
Fees and charges

Octopus asked investors to rank their level of satisfaction against each of the top eight factors and the results were as follows:

	Satisfied	Dissatisfied	Neutral or not sure
Tax reliefs available on your investment	88%	2%	10%
5% annual target dividend	50%	22%	28%
Capital growth opportunity	18%	60%	22%
Past performance of fund	21%	52%	27%
Access to early-stage, unlisted tech enabled companies with high growth potential	39%	10%	51%
Ability to sell your shares back to the VCT via the share buyback facility	29%	8%	63%
Size of fund	34%	6%	60%
Fees and charges	22%	18%	60%

Survey results based on responses from 1,093 direct investors and 2,195 advised investors, does not include responses from advisers.

Valuations
Titan’s unquoted portfolio companies are valued in accordance with UK GAAP accounting standards and the International Private Equity and Venture Capital (IPEV) valuation guidelines. This means we value the portfolio at Fair Value, which is the price we expect people would be willing to buy or sell an asset for, assuming they had all the information available that we do, are knowledgeable parties with no pre-existing relationship, and that the transaction is carried out under the normal course of business.

The table below illustrates the split of valuation methodology (shown as a percentage of portfolio value and number of companies). ‘External price’ includes valuations based on funding rounds that typically completed by the year end or shortly after the year end, and exits of companies where terms have been issued with an acquirer. ‘External price’ also includes quoted holdings, which are held at their quoted price as at the valuation date. As at 31 December 2024, Titan only held one quoted holding. ‘Multiples’ is predominantly used for valuations that are based on a multiple of revenues for portfolio companies. Where there is uncertainty around the potential outcomes available to a company, a probability-weighted ‘scenario analysis’ is considered.

Valuation methodology	By value	By number of companies
External price	17%	25
Multiples	53%	30
Scenario analysis	16%	33
Milestone analysis	14%	25
Write-off	–	25

Case studies

MANUAL
https://www.manual.co/
Making high-quality care more accessible and stigma-free

MANUAL provides innovative treatments for a range of conditions, from hair loss and low testosterone to weight management and diagnostics.

With over 800,000 patients served across the UK and Brazil, MANUAL continues to expand its impact. The company’s weight loss brand, Voy, has helped over 70,000 people lose weight. In 2024, MANUAL acquired Menopause Care – the UK’s second largest menopause clinic – furthering its mission to support underserved areas of health.

Following the company’s £29 million Series B raise in 2024, the company is accelerating its growth, with a 140% revenue Compound Annual Growth Rate (CAGR) since 2019. With this investment, MANUAL is scaling its reach and pioneering new healthcare solutions, ensuring more people get the treatments they need to improve their quality of life.

Nearly 90% of men do not seek help unless they have a serious problem
Served more than 800,000 patients to date

Legl
https://legl.com/
Revolutionising Legal Services with AI and Data-Driven Insights

Legl delivers a world-class client experience for UK law firms by reducing risk, improving cash flow, and enabling them to bill and collect payments faster. With actionable client intelligence, their customers are empowered to make smarter decisions and drive business growth.

By leveraging cutting-edge technology and data insights, Legl creates seamless onboarding experiences and superior payment processing capabilities. Beyond onboarding, they provide intelligence and audit functionality to help firms manage risk intelligently in a complex and ever-changing environment. Its embedded finance stack, which has been built specifically for law firms, makes collecting payments, reducing debt, and fostering exceptional client relationships effortless. In turn, providing a step-change for internal cash flow and treasury management.

Helped firms manage risk for over one million clients
Processed over $500 million in payments

BondAval
https://www.bondaval.com/
Transforming non-payment risk protection

Founded in 2020, B2B insurtech Bondaval protects companies when their customers buy now, but don’t pay later, and is already serving some of the largest companies in the world. While existing options are opaque, inflexible or limited, Bondaval’s range of insurance products are made more powerful via their proprietary technology platform, which translates policy obligations into clear tasks, helps aggregate and monitor risk signals, and makes limit management effortless for credit managers. With their receivables secured, businesses can grow faster with more peace of mind, achieve more predictable financial performance, and even access new lines of financing.

Offices in London, New York and Dallas
Licensed in 30+ countries

Taster
https://taster.com/
Food innovators redefining quick-service dining

Taster was founded with the goal of revolutionising the quick-service food experience globally. In 2017, the company raised €8 million, and by 2021, they secured an additional €30 million. By the end of 2023, Taster had grown to 400 online restaurants, with its franchise network expanding across France, the UK, Spain, the Netherlands, and Belgium. Taster collaborates closely with co-creators and kitchen partners, from launching new brands to creating special edition menu items. Their strategy focuses on building social media-first brands that engage audiences and cultivate communities around their digital restaurants.

Operating in over 90 cities across Europe

We are disappointed to report a net decrease in the value of the portfolio of £137 million since 31 December 2023, excluding additions and disposals. This represents a decline of 17% on the value of the portfolio at the start of the year. Here, we set out the cost and valuation of the top 20 holdings, which account for 61% of the value of the portfolio and 47% of the total NAV.

	Portfolio:	Investment focus:	Investment cost:	Total valuation including cost:
1	Skin+Me	Health	£11.5m	£44.9m
2	Amplience	B2B Software	£13.6m	£35.0m
3	Permutive	B2B Software	£19.0m	£31.0m
4	Elliptic	Fintech	£9.9m	£26.2m
5	Vitesse	Fintech	£8.8m	£25.8m
6	ManyPets	Fintech	£10.0m	£24.6m
7	Pelago¹	Health	£17.9m	£23.2m
8	Legl	B2B Software	£7.3m	£18.6m
9	Orbex	Deep tech	£12.0m	£17.8m
10	Token	Fintech	£12.6m	£16.5m
11	Taster	Consumer	£8.1m	£15.4m
12	vHive	Deep tech	£8.0m	£14.9m
13	Ometria	B2B Software	£11.5m	£14.0m
14	SeatFrog	Consumer	£9.6m	£13.5m
15	KatKin	Consumer	£8.2m	£13.2m
16	Automata	Health	£12.3m	£12.4m
17	XYZ	Consumer	£15.3m	£10.7m
18	BondAval	Fintech	£7.1m	£10.6m
19	Iovox	B2B Software	£7.2m	£10.4m
20	Ibex	Health	£11.8m	£9.5m

Digital Therapeutics, Inc., formerly Quit Genius, has rebranded as Pelago.

Top 10 investments in detail¹
1
Skin+Me

Skin+Me offers direct-to-consumer, personalised skincare.
www.skinandme.com

Initial investment date:	September 2019
Investment cost:	£11.5m
	(2023: £11.5m)
Valuation:	£44.9m
	(2023: £48.5m)
Last submitted accounts:	31 August 2023
Turnover:	£28.7m (2023: £14.3m)
Profit/(loss) before tax:	£1.8m
	(2023: £(3.3)m)
Net assets:	£12.8m
	(2023: £(0.7m)
Valuation methodology:	Multiple 2023: Multiple

2
Amplience
Amplience is a leading headless content management system, which powers retailers’ digital channels.
www.amplience.com

Initial investment date:	December 2010
Investment cost:	£13.6m
	(2023: £13.6m)
Valuation:	£35.0m
	(2023: £41.8m)
Last submitted accounts:	30 June 2024
Turnover:	£16.0m
	(2023: £14.9m)
Loss before tax:	£(5.5)m
	(2023: £(8.1)m)
Net assets:	£(22.8)m
	(2023: (£17.4m)
Valuation methodology:	Multiple 2023: Multiple

3
Permutive
Permutive’s publisher data platform gives its customers an in-the-moment view of everyone on their site.
www.permutive.com

Initial investment date:	May 2015
Investment cost:	£19.0m
	(2023: £19.0m)
Valuation:	£31.0m
	(2023: £41.2m)
Last submitted accounts:	31 January 2023
Turnover:	Not available²
	(2023: £9.8m)
Loss before tax:	Not available²
	(2023: £(19.3)m)
Net assets:	Not available²
	(2023: £(40.2)m)
Valuation methodology:	Multiple
	2023: Multiple

4
Elliptic
Crypto compliance and forensic investigation solutions used by financial institutions, crypto businesses, law enforcement, and regulators to detect and prevent financial crime.
www.elliptic.co

Initial investment date:	July 2014
Investment cost:	£9.9m
	(2023: £9.9m)
Valuation:	£26.2m
	(2023: £19.0m)
Last submitted accounts:	31 March 2024
Turnover:	£13.7m
	(2023: £9.6m)
Loss before tax:	£(16.4)m
	(2023: £(27.1)m)
Net assets:	£(3.8)m
	(2023: £10.6m)
Valuation methodology:	Multiple 2023: Multiple

5
Vitesse

A settlement and liquidity management platform to hold funds and deliver international payments globally, using domestic, in-country processing.
www.vitesse.io/

Initial investment date:	June 2020
Investment cost:	£8.8m
	(2023: £10.1m)
Valuation:	£25.8m
	(2023: £26.6m)
Last submitted accounts:	31 March 2024
Consolidated turnover:	£24.8m
	(2023: £11.2m)
Consolidated profit/(loss) before tax:	£0.6m
	(2023: £(5.7)m)
Net assets:	£17.3m
	(2023: £16.2m)
Valuation methodology:	Multiple 2023: Last Round

6
ManyPets

An award-winning insurtech company with a specific focus on providing better pet insurance for everyone.
www.manypets.com

Initial investment date:	October 2016
Investment cost:	£10.0m
	(2023: £10.0m)
Valuation:	£24.6m
	(2023: £47.1m)
Last submitted accounts:	31 March 2024
Turnover:	£29.6m
	(2023: £35.9m)
Loss before tax:	£(34.1)m
	(2023: £(67.5)m)
Net assets:	£79.9m
	(2023: £110.6m)
Valuation methodology:	Multiple 2023: Multiple

7
Pelago

A digital health solution for managing substance use disorders.
www.pelagohealth.com

Initial investment date:	January 2020
Investment cost:	£17.9m (2023: £17.9m)
Valuation:	£23.2m
	(2023: £38.6m)
Last submitted accounts:	Not available²
Turnover:	Not available² 2023: Not available²:
Loss before tax:	Not available² 2023: Not available²
Net assets:	Not available² 2023: Not available²
Valuation methodology:	Multiple 2023: Last round

8
Legl
Cloud based legal workflow automation platform.
www.legl.com

Initial investment date:	January 2021
Investment cost:	£7.3m
	(2023: £7.3m)
Valuation:	£18.6m
	(2023: £13.8m)
Last submitted accounts:	31 December 2023
Turnover:	Not available²
	2023: Not available²
Profit/(loss) before tax:	$1.5m
	(2023: $(0.1)m)
Net assets:	$30.4m
	(2023: $28.8m)
Valuation methodology:	Multiple 2023: Multiple

9
Orbex

Focused on providing low-cost orbital launch services for small satellites.
www.orbex.space

Initial investment date:	December 2020
Investment cost:	£12.0m
	(2023: £10.3m)
Valuation:	£17.8m
	(2023: £15.3m)
Last submitted group accounts:	31 December 2023
Turnover:	Not available² 2023: Not available²
Consolidated loss before tax:	£(17.2)m (2023:(8.8)m)
Consolidated net assets:	£16.3m
	(2023: £31.8m)
Valuation methodology:	Scenario Analysis 2023: Scenario Analysis

10
Token

A leading open banking solution, focused on payments.
www.token.io

Initial investment date:	March 2017
Investment cost:	£12.6m
	(2023: £12.6m)
Valuation:	£16.5m
	(2023: £17.1m)
Last submitted group accounts:	31 December 2023
Turnover:	Not available² 2023: Not available²
Loss before tax:	Not available² 2023: Not available²
Net assets:	£0.9m
	(2023: £0.7m)
Valuation methodology:	Multiple 2023: Multiple

1. These are numbers per latest public filings. More recent figures have not yet been disclosed.
2. Information not publicly available.

Outlook
Our portfolio companies have been navigating a turbulent few years and global geo‑political and economic conditions remain uncertain. Due to the early‑stage nature of the portfolio companies, any improvement in conditions will not be felt immediately.

The fundraising environment remains challenging for portfolio companies, with 2024 seeing both a decline in the number of investments completed at the seed and Series A stages and many rounds completing at decreased valuations. This is largely a function of a reset in venture-backed valuations which began in 2022, with many companies having no option but to accept a reduced valuation to bring in new capital to survive or scale. We have also seen in the year that the venture landscape has been reshaped by AI, which captured a 37% share in all funding in 2024 and 17% of all deals.¹ However, when AI investments are excluded, global deal activity dropped to its lowest levels since 2016.

With some of our portfolio companies struggling to secure new investors and requiring significant investment to develop, many have had to focus on cash preservation and limit their growth. As such, the valuation multiples being applied have declined in line with this. We have also seen some companies being unable to achieve the milestones Octopus set out when the initial investment was completed and so we have seen more declines in value.

Looking to the future, the Octopus Ventures team has been focusing on driving both improved performance and distributions to Titan. In the year, we have been able to realise £29 million in cash proceeds to the Company from exits. This includes deferred amounts received in cash relating to disposals from previous periods. In addition, £12.4 million was distributed from Zenith Holding Company to the Company. The team is actively involved in its portfolio companies and during the year developed specific workstreams to support the portfolio with value-adding activities, as summarised below:

Capital allocation: aims to optimise financial planning by fostering stronger alignment between each company’s strategic objectives and their financial plans, reducing the risk of unexpected cash issues and value-eroding insolvencies or emergency down-rounds. Improving financial planning will ensure efficient resource allocation, minimise risks and enhance profitability, ultimately leading to sustainable growth and long-term success.
Return: looking to drive exits or other liquidity events as part of a clear aim of regularly recycling capital back into the Company.
Raise: to improve fundraising outcomes for portfolio companies, through initiatives such as supporting the creation of fundraising material, network introductions for potential investors or timeframe planning. Raising additional funding is crucial to provide the necessary capital to expand operations, invest in new technologies and seize available growth opportunities, ensuring a company’s long-term viability and competitive edge.
Talent and board: to drive performance in companies by supporting and influencing the build of high performing leadership teams and effective boards. This workstream is driven by Octopus Ventures in-house People and Talent team. Building talented teams drives innovation, enhances productivity and contributes to a positive work culture, all of which lead to a company’s overall success.

Titan’s capital and resources have been prioritised on those portfolio companies which have the potential to drive the greatest returns. This portfolio focus has been leveraging the advantages Titan has of being a very large and mature VCT holding a highly diversified portfolio. Having made over 80 investments in the preceding few years, there remains the opportunity for long-term returns to the Company. The ongoing focus for the team will be optimising growth plans for the portfolio and taking advantage of exit opportunities.

1. https://www.cbinsights.com/research/report/venture-trends-2024/

Risks and risk management

The Board assesses the risks faced by Titan and, as a board, reviews the mitigating controls and actions, and monitors the effectiveness of these controls and actions.

Emerging and principal risks, and risk management

Emerging risks

The Board has considered emerging risks. The Board seeks to mitigate emerging risks and those noted below by setting policy, regular review of performance and monitoring progress and compliance. In the mitigation and management of these risks, the Board applies the principles detailed in the Financial Reporting Council’s Guidance on Risk Management, Internal Control and Related Financial and Business Reporting.

The following are some of the potential emerging risks that management and the Board are currently monitoring:

adverse changes in global macroeconomic environment;
challenging market conditions for private company fundraising and exits;
geo-political instability; and
climate change.

Principal risks

*Risk*	*Mitigation*	*Change*
Investment performance:
The focus of Titan’s investments is into unquoted, small and medium‑sized VCT qualifying companies which, by their nature, entail a higher level of risk and shorter cash runway than investments in larger quoted companies.	Octopus has significant experience of investing in early-stage unquoted companies, and appropriate due diligence is undertaken on every new investment. A member of the Octopus Ventures team is appointed to the board of a portfolio company using a risk-based approach, considering the size of the company within the Titan portfolio and the engagement levels of other investors. Regular board reports are prepared by the portfolio company’s management and examined by the Manager. This arrangement, in conjunction with its Portfolio Talent team’s active involvement, allows Titan to play a prominent role when necessary in a portfolio company’s ongoing development and strategy. The overall risk in the portfolio is mitigated by maintaining a wide spread of holdings in terms of financing stage, age, industry sector and business model. The Board reviews the investment portfolio with the Portfolio Manager on a regular basis. The Portfolio Manager is incentivised via a performance incentive fee for exceeding certain performance hurdles. The Board and Octopus are reviewing the fee structure.	Risk exposures continue to increase due to the difficult macro environment and challenging trading conditions for some portfolio companies continuing.
*Risk*	*Mitigation*	*Change*
VCT qualifying status:
Titan is required at all times to observe the conditions for the maintenance of approved VCT status. The loss of such approval could lead to Titan and its investors losing access to the various tax benefits associated with VCT status and investment.	Octopus tracks Titan’s qualifying status regularly throughout the year, and reviews this at key points including investment realisation. This status is reported to the Board at each Board meeting. The Board has also engaged external independent advisers to undertake an independent VCT status monitoring role.	Decreased exposures reflected in the previous period remain. VCT status monitoring by independent advisers continues to reduce the risk of an issue causing a loss of VCT status.
*Risk*	*Mitigation*	*Change*
Loss of key people:
The loss of key investment staff by the Portfolio Manager could lead to poor fund management and/or performance due to lack of continuity or understanding of Titan.	The Portfolio Manager has a broad team, experienced in and focused on early-stage investing and portfolio company management. Various mitigants exist to assist in managing key person risk. These include frameworks that review succession, remuneration and career progression. Workforce planning is continuous and reviews skillsets and team structures. To reduce the exposure further, the core team is also supplemented by part-time venture partners with sector or functional specialism.	The increased exposures reflected in the previous period remain due to the loss of the lead fund manager and other leadership positions at the Portfolio Manager. The absence of a performance fee and lack of new investments or deal-making opportunities compared to previous periods are also factors.
*Risk*	*Mitigation*	*Change*
Operational:
The Board is reliant on the Portfolio Manager to manage investments effectively, and manage the services of a number of third parties, in particular the registrar, depositary and tax advisers. A failure of the systems or controls at Octopus or third-party providers could lead to an inability to provide accurate reporting and accounting and to ensure adherence to VCT rules.	The Board reviews the system of internal controls, both financial and non-financial, operated by Octopus (to the extent the latter are relevant to Titan’s internal controls). These include controls designed to make sure that Titan’s assets are safeguarded and that proper accounting records are maintained.	No overall change in risk exposure on balance.
*Risk*	*Mitigation*	*Change*
Information security:
A loss of key data could result in a data breach and fines. The Board is reliant on Octopus and third parties to take appropriate measures to prevent a loss of confidential customer information.	Annual due diligence is conducted on third parties which includes a review of their controls for information security. Octopus has a dedicated information security team and a third party is engaged to provide continual protection in this area. A security framework is in place to help prevent malicious events.	No overall change on balance, although cyber threat remains a significant risk area faced by all service providers. The appropriateness of mitigants in place are continuously reassessed to adapt to new risk exposures, such as those posed by artificial intelligence.
*Risk*	*Mitigation*	*Change*
Economic:
Events such as an economic recession and movement in interest rates could adversely affect some smaller companies’ valuations, as they may be more vulnerable to changes in trading conditions or the sectors in which they operate. This could result in a reduction in the value of Titan’s assets.	Titan invests in a diverse portfolio of companies, across a range of sectors, which helps to mitigate against the impact on any one sector. Titan also maintains adequate liquidity to make sure it can continue to provide follow‑on investment to those portfolio companies which require it and which is supported by the individual investment case.	Increased exposures reflected in the previous periods remain and have heightened further as economic uncertainty persists through high inflation, high interest rates and other economic factors.
*Risk*	*Mitigation*	*Change*
Legislative:
A change to the VCT regulations could adversely impact Titan by restricting the companies Titan can invest in under its current strategy. Similarly, changes to VCT tax reliefs for investors could make VCTs less attractive and impact Titan’s ability to raise further funds.	The Portfolio Manager engages with HM Treasury and industry bodies to demonstrate the positive benefits of VCTs in terms of growing early-stage companies, creating jobs and increasing tax revenue, and to help shape any change to VCT legislation.	Risk exposure has continued to reduce since the previous period following the extension of the sunset clause to 2035 being agreed.
*Risk*	*Mitigation*	*Change*
Liquidity:
The risk that Titan’s available cash will not be sufficient to meet its financial obligations. Titan invests in smaller unquoted companies, which are inherently illiquid as there is no readily available market for these shares. Therefore, these may be difficult to realise for their fair market value at short notice.	Titan’s liquidity risk is managed on a continuing basis by Octopus in accordance with policies and procedures agreed by the Board. Titan’s overall liquidity risks are monitored on a quarterly basis by the Board, with frequent budgeting and close monitoring of available cash resources. Titan maintains sufficient investments in cash and readily realisable securities to meet its financial obligations. At 31 December 2024, these investments were valued at £183,770,000 (2023: £199,841,000), which represents 22% (2023: 20%) of the net assets of Titan. The Board also reviews the cash runway in the portfolio.	Risk exposure has continued to increase, reflecting economic uncertainty, the impact on fundraising and the risk of failing to exit portfolio companies.
*Risk*	*Mitigation*	*Change*
Valuation:
The portfolio investments are valued in accordance with International Private Equity and Venture Capital (IPEV) valuation guidelines. This means companies are valued at fair value. As the portfolio comprises smaller unquoted companies, establishing fair value can be difficult due to the lack of a readily available market for the shares of such companies and the potentially limited number of external reference points.	Valuations of portfolio companies are performed by appropriately experienced staff, with detailed knowledge of both the portfolio company and the market it operates in. These valuations are then subject to review and approval by Octopus’ Valuation Committee, comprised of staff who are independent of Octopus Ventures with relevant knowledge of unquoted company valuations, as well as Titan’s Board of Directors.	Risk exposure remains unchanged from the previous period due to economic uncertainty within valuation modelling.
*Risk*	*Mitigation*	*Change*
Foreign currency exposure:
Investments held and revenues generated in other currencies may not generate the expected level of returns due to changes in foreign exchange rates.	Octopus and the Board regularly review the exposure to foreign currency movement to make sure the level of risk is appropriately managed. Investments are primarily made in GBP, EUR and USD so exposure is limited to a small number of currencies. On realisation of investments held in foreign currencies, cash is converted to GBP shortly after receiving the proceeds to limit the amount of time exposed to foreign currency fluctuations.	Risk exposure has not changed since the previous period.

Viability statement

In accordance with the FRC UK Corporate Governance Code published in 2018 and provision 36 of the AIC Code of Corporate Governance, the Directors have assessed the prospects of Titan over a period of five years, consistent with the expected investment hold period of a VCT investor. Under VCT rules, subscribing investors are required to hold their investment for a five-year period in order to benefit from the associated tax reliefs. The Board regularly considers strategy, including investor demand for Titan’s shares, and a five-year period is considered to be a reasonable time horizon for this.

The Board carried out a robust assessment of the emerging and principal risks facing Titan and its current position, including risks which may adversely impact its business model, future performance, solvency or liquidity, and focused on the major factors which affect the economic, regulatory and political environment. Particular consideration was given to Titan’s reliance on, and close working relationship with, the Portfolio Manager.

The Board has carried out robust stress testing of cash flows which included assessing the resilience of portfolio companies, including the requirement for any future financial support and the ability to pay dividends, and buybacks.

The Board has additionally considered the ability of Titan to comply with the ongoing conditions to make sure it maintains its VCT qualifying status under its current Investment policy.

Based on this assessment the Board confirms that it has a reasonable expectation that Titan will be able to continue in operation and meet its liabilities as they fall due over the five-year period to 31 December 2029. The Board is mindful of the ongoing risks and will continue to make sure that appropriate safeguards are in place, in addition to monitoring the cash flow forecasts to ensure Titan has sufficient liquidity.

Directors’ responsibilities statement

The Directors are responsible for preparing the Strategic Report, the Directors’ Report, the Directors’ Remuneration Report and the financial statements in accordance with applicable law and regulations. They are also responsible for ensuring that the annual report and financial statements include information required by the Listing Rules of the Financial Conduct Authority.

Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (GAAP), including Financial Reporting Standard 102 – ‘The Financial Reporting Standard Applicable in the United Kingdom and Republic of Ireland’ (FRS 102), (United Kingdom accounting standards and applicable law). Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs and profit or loss of the Company for that period. In preparing these financial statements, the Directors are required to:

select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business; and
prepare a Strategic Report, Directors’ Report and Directors’ Remuneration Report which comply with the requirements of the Companies Act 2006.

Insofar as each of the Directors is aware:

there is no relevant audit information of which the Company’s auditor is unaware; and
the Directors have taken all steps that they ought to have taken to make themselves aware of any relevant audit information and to establish that the auditor is aware of that information.

The Directors confirm that, to the best of their knowledge:

the financial statements, prepared in accordance with United Kingdom Generally Accepted Accounting Practice, including FRS 102, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company; and
the annual report and financial statements (including the Strategic Report), give a fair review of the development and performance of the business and the position of the Company, together with a description of the principal risks and uncertainties that it faces.

On behalf of the Board

Tom Leader
Chair

Income statement

	Year to 31 December 2024			Year to 31 December 2023
	Revenue	Capital	Total	Revenue	Capital	Total
	£’000	£’000	£’000	£’000	£’000	£’000
Gain/(loss)/gain on disposal of fixed asset investments	—	5,184	5,184	—	(1,870)	(1,870)
Gain on disposal of current asset investments	—	563	563	—	355	355
Loss on valuation of fixed asset investments	—	(136,894)	(136,894)	—	(131,655)	(131,655)
Gain on valuation of current asset investments	—	4,439	4,439	—	8,098	8,098
Investment income	4,215	—	4,215	4,467	—	4,467
Investment management fee	(954)	(18,125)	(19,079)	(1,054)	(20,028)	(21,082)
Other expenses	(6,072)	—	(6,072)	(6,264)	—	(6,264)
Foreign exchange translation	—	(5)	(5)	—	(1,548)	(1,548)
Loss before tax	(2,811)	(144,838)	(147,649)	(2,851)	(146,648)	(149,499)
Tax	—	—	—	—	—	—
Loss after tax	(2,811)	(144,838)	(147,649)	(2,851)	(146,648)	(149,499)
Loss per share – basic and diluted	(0.2)p	(8.8)p	(9.0)p	(0.2)p	(9.7)p	(9.9)p

The ‘Total’ column of this statement is the profit and loss account of Titan. The supplementary revenue return and capital return columns have been prepared under guidance published by the Association of Investment Companies.
All revenue and capital items in the above statement derive from continuing operations.
Titan has only one class of business and derives its income from investments made in shares and securities, and from bank and money market funds.

Titan has no other comprehensive income for the period.

The accompanying notes form an integral part of the financial statements.

Balance sheet

	As at 31 December 2024		As at 31 December 2023
	£’000	£’000	£’000	£’000
Fixed asset investments		640,797		791,403
Current assets:
Money market funds	93,523		91,172
Corporate bonds	90,247		108,669
Applications cash¹	22		17,842
Cash at bank	213		2,970
Debtors	8,412		1,218
		192,417		221,871
Creditors: amounts falling due within one year	(1,856)		(19,530)
Net current assets		190,561		202,341

Net assets		831,358		993,744

Share capital		1,647		1,594
Share premium		—		45,780
Capital redemption reserve		141		74
Special distributable reserve		1,056,537		1,025,614
Capital reserve realised		(125,444)		(89,570)
Capital reserve unrealised		(57,285)		51,674
Revenue reserve		(44,238)		(41,422)

Total equity shareholders’ funds		831,358		993,744

NAV per share		50.5p		62.4p

Funds raised from investors since Titan opened for new investment which have not been allotted as at year end.

The accompanying notes form an integral part of the financial statements.

The statements were approved by the Directors and authorised for issue on 28 April 2025 and are signed on their behalf by:

Tom Leader, Chair
Company Number 06397765

Statement of changes in equity

			Capital	Special	Capital	Capital
	Share	Share	redemption	distributable	reserve	reserve	Revenue
	capital	premium	reserve	reserve¹	realised¹	unrealised	reserve¹	Total
	£’000	£’000	£’000	£’000	£’000	£’000	£’000	£’000
As at 1 January 2024	1,594	45,780	74	1,025,614	(89,570)	51,674	(41,422)	993,744
Comprehensive income for the year:
Management fees allocated as capital expenditure	—	—	—	—	(18,125)	—	—	(18,125)
Current year gain on disposal of fixed asset investments	—	—	—	—	5,184	—	—	5,184
Current year gain on disposal of current asset investments	—	—	—	—	563	—	—	563
Loss on fair value of fixed asset investments	—	—	—	—	—	(136,894)	—	(136,894)
Gain on fair value of current asset investments	—	—	—	—	—	4,439	—	4,439
Loss after tax	—	—	—	—	—	—	(2,811)	(2,811)
Foreign exchange translation	—	—	—	—	—	—	(5)	(5)
Total comprehensive income for the year	—	—	—	—	(12,378)	(132,455)	(2,816)	(147,649)
Contributions by and distributions to owners:
Share issue (includes DRIS)	120	76,664	—	—	—	—	—	76,784
Share issue costs	—	(1,893)	—	—	—	—	—	(1,893)
Repurchase of own shares	(67)	—	67	(37,986)	—	—	—	(37,986)
Dividends paid (includes DRIS)	—	—	—	(51,642)	—	—	—	(51,642)
Total contributions by and distributions to owners	53	74,771	67	(89,628)	—	—	—	(14,737)
Other movements:
Share premium cancellation	—	(120,551)	—	120,551	—	—	—	—
Prior year fixed asset gains now realised	—	—	—	—	7,473	(7,473)	—	—
Prior year current asset losses now realised	—	—	—	—	(74)	74	—	—
Transfer between reserves	—	—	—	—	(30,895)	30,895	—	—
Total other movements	—	(120,551)	—	120,551	(23,496)	23,496	—	—
Balance as at 31 December 2024	1,647	—	141	1,056,537	(125,444)	(57,285)	(44,238)	831,358

Reserves are available for distribution, subject to the restrictions.

The accompanying notes form an integral part of the financial statements.

			Capital	Special	Capital	Capital
	Share	Share	redemption	distributable	reserve	reserve	Revenue
	capital	premium	reserve	reserve¹	realised¹	unrealised	reserve¹	Total
	£’000	£’000	£’000	£’000	£’000	£’000	£’000	£’000
As at 1 January 2023	1,368	92,896	27	887,288	(53,430)	160,634	(37,023)	1,051,760
Comprehensive income for the year:
Management fees allocated as capital expenditure	—	—	—	—	(20,028)	—	—	(20,028)
Current year loss on disposal of fixed asset investments	—	—	—	—	(1,870)	—	—	(1,870)
Current year gain on disposal of current asset investments	—	—	—	—	355	—	—	355
Loss on fair value of fixed asset investments	—	—	—	—	—	(131,655)	—	(131,655)
Gain on fair value of current asset investments	—	—	—	—	—	8,098	—	8,098
Loss after tax	—	—	—	—	—	—	(2,851)	(2,851)
Foreign exchange translation	—	—	—	—	—	—	(1,548)	(1,548)
Total comprehensive income for the year	—	—	—	—	(21,543)	(123,557)	(4,399)	(149,499)
Contributions by and distributions to owners:
Share issue (includes DRIS)	273	207,132	—	—	—	—	—	207,405
Share issue costs	—	(5,737)	—	—	—	—	—	(5,737)
Repurchase of own shares	(47)	—	47	(32,422)	—	—	—	(32,422)
Dividends paid (includes DRIS)	—	—	—	(77,763)	—	—	—	(77,763)
Total contributions by and distributions to owners	226	201,395	47	(110,185)	—	—	—	91,483
Other movements:
Share premium cancellation	—	(248,511)	—	248,511	—	—	—	—
Prior year current asset losses now realised	—	—	—	—	(355)	355	—	—
Transfer between reserves	—	—	—	—	(14,242)	14,242	—	—
Total other movements	—	(248,511)	—	248,511	(14,597)	14,597	—	—
Balance as at 31 December 2023	1,594	45,780	74	1,025,614	(89,570)	51,674	(41,422)	993,744

Reserves are available for distribution, subject to the restrictions.

The accompanying notes form an integral part of the financial statements.

Cash flow statement

	Year to 31 December	Year to 31 December
	2024	2023
	£’000	£’000
Reconciliation of profit to cash flows from operating activities
Loss before tax¹	(147,649)	(149,499)
Decrease in debtors²	279	3,671
Decrease/(increase) in creditors	146	(440)
Gain on disposal of current asset investments	(563)	(355)
Gain on valuation of current asset investments	(4,439)	(8,098)
Gain on disposal of fixed asset investments	(5,184)	(1,111)
Loss on valuation of fixed asset investments	136,894	131,655
Outflow from operating activities	(20,516)	(24,177)
Cash flows from investing activities
Sale of current asset investments	23,424	4,028
Purchase of fixed asset investments	(30,011)	(97,650)
Proceeds from sale of fixed asset investments³	41,432	45,637
Inflow/(outflow) from investing activities	34,845	(47,985)
Cash flows from financing activities
Movement in applications account	(17,820)	(5,457)
Dividends paid (net of DRIS)	(43,881)	(58,210)
Purchase of own shares	(37,986)	(32,422)
Share issues (net of DRIS)	69,025	187,852
Share issue costs	(1,893)	(5,737)
(Outflow)/inflow from financing activities	(32,555)	86,026
Increase/(decrease) in cash and cash equivalents	(18,226)	13,864
Opening cash and cash equivalents	111,984	98,120
Closing cash and cash equivalents	93,758	111,984
Cash and cash equivalents comprise
Cash at bank	213	2,970
Applications cash	22	17,842
Money market funds	93,523	91,172
Closing cash and cash equivalents	93,758	111,984

Loss before tax includes cashflows from dividends of £4.2 million (2023: £4.2 million).
Movement in debtors, net of disposal proceeds received in the year £41.4 million, with £40.9 million relating to current year disposals and £0.5 million relating to prior year disposals.
Of these proceeds, £12.4 million was distributed from Zenith Holding Company, a wholly owned subsidiary of Titan, to Titan during the year.

The accompanying notes form an integral part of the financial statements.

Notes to the financial statements

1. Principal accounting policies

Titan is a Public Limited Company (plc) incorporated in England and Wales and its registered office is at 6th Floor, 33 Holborn, London EC1N 2HT.

Titan has been approved as a Venture Capital Trust by HMRC under Section 259 of the Income Taxes Act 2007. The shares of Titan were first admitted to the Official List of the UK Listing Authority and trading on the London Stock Exchange on 28 December 2007 and can be found under the TIDM code OTV2. Titan is premium listed.

The principal activity of Titan is to invest in a diversified portfolio of UK smaller companies in order to generate capital growth over the long term as well as an attractive tax-free dividend stream.

Basis of preparation

The financial statements have been prepared on a going concern basis under the historical cost convention, except for the measurement at fair value of certain financial instruments, and in accordance with UK Generally Accepted Accounting Practice (GAAP), including Financial Reporting Standard 102 – ‘The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland’ (FRS 102), and with the Companies Act 2006 and the Statement of Recommended Practice (SORP) ‘Financial Statements of Investment Trust Companies and Venture Capital Trusts (July 2022)’.

2. Investment income
Accounting policy
Investment income includes interest earned on money market funds. Dividend income is shown net of any related tax credit.

Dividends receivable are brought into account when Titan’s right to receive payment is established and there is no reasonable doubt that payment will be received. Fixed returns on debt and money market funds are recognised so as to reflect the effective interest rate, provided there is no reasonable doubt that payment will be received in due course.

Disclosure

	Year to	Year to
	31 December	31 December
	2024	2023
	£’000	£’000
Money market funds	4,215	4,154
Loan note interest receivable	—	313
Total investment income	4,215	4,467

In the current year, accrued loan note interest income is treated to be included in the fair value of investments. The opening balance of accrued loan interest has been reclassified to be included in the fair value of investments. This reclassification amends the balance previously reported as of 31 December 2023.

3. Investment management fees
Accounting policy

For the purposes of the revenue and capital columns in the Income Statement, the management fee has been allocated 5% to revenue and 95% to capital, in line with the Board’s expected long-term return in the form of income and capital gains respectively from Titan’s investment portfolio.

Disclosure

	Year to 31 December 2024			Year to 31 December 2023
	Revenue	Capital	Total	Revenue	Capital	Total
	£’000	£’000	£’000	£’000	£’000	£’000
Investment
management fee	954	18,125	19,079	1,054	20,028	21,082

The Portfolio Manager provides investment management services through agreements with Octopus AIF Management Limited and Titan. It also provides non-investment services to Titan under a non-investment services agreement. No compensation is payable if the agreement is terminated by either party, if the required notice period is given. The fee payable, should insufficient notice be given, will be equal to the fee that would have been paid should continuous service be provided, or the required notice period was given. The basis upon which the management fee is calculated is disclosed within the Annual Report and financial statements.

4. Other expenses
Accounting policy

Other expenses are accounted for on an accruals basis and are charged wholly to revenue.

The transaction costs incurred when purchasing or selling assets are written off to the Income Statement in the period that they occur.

	Year to	Year to
	31 December	31 December
	2024	2023
	£’000	£’000
Ongoing adviser and non-advised charges	2,111	2,370
Non-investment services fee¹	2,078	2,020
Other fees	780	480
Directors’ remuneration²	263	192
Audit fees	204	191
Registrar’s fees	196	200
Depositary fees	187	270
Listing fees	136	401
Directors and Officers (D&O) insurance	117	123
Impairment of accrued loan note interest receivable	—	17
Total	6,072	6,264

For further information please see note 9.
Includes employers’ NI.

Total ongoing charges are capped at 2.5% of net assets. For the year to 31 December 2024, the ongoing charges were 2.5% of net assets (2023: 2.4%). This is calculated by summing the expenses incurred in the period (excluding ongoing IFA charges and non‑recurring expenses) divided by the average NAV throughout the period.

5. Tax on ordinary activities
Accounting policy

Disclosure
The corporation tax charge for the period was £nil (2023: £nil).

	Year to	Year to
	31 December	31 December
	2024	2023
	£’000	£’000
Loss on ordinary activities before tax	(147,649)	(149,499)
Current tax at 25% (2023: 23.5%)	(36,912)	(35,163)
Effects of:
Non‑taxable income	(1,054)	(977)
Non‑taxable capital loss	31,677	29,418
Non‑deductible expenses	55	71
Zenith distribution¹	3,100	—
Excess management expenses on which deferred tax not recognised	3,134	7,070
Tax rate differences²	—	(419)
Total current tax charge	—	—

1. £12.4 million was distributed from Zenith Holding Company to Titan in the year which is taxable income for Titan.
2. Tax rate difference in the year to 31 December 2023 due to tax charge for the year being calculated at 19% and excess management expenses on which deferred tax is not recognised being calculated at 25%.

Unrelieved tax losses of £227,486,000 (2023: £214,949,000) are estimated to be carried forward at 31 December 2024 (subject to completion of Titan’s tax return) and are available for offset against future taxable income, subject to agreement with HMRC. Titan has not recognised the deferred tax asset of £56,871,000 (2023: £53,737,000) in respect of these tax losses because there is insufficient forecast taxable income in excess of deductible expenses to utilise these losses carried forward. There is no expiry period on these deductible expenses under the UK HMRC legislation.

Approved VCTs are exempt from tax on capital gains. As the Directors intend for Titan to continue to maintain its approval as a VCT through its affairs, no current deferred tax has been recognised in respect of any capital gains or losses arising on the revaluation or disposal of investment.

6. Dividends
Accounting policy

Dividends payable are recognised as distributions in the financial statements when Titan’s liability to make the payment has been established. This liability is established on the record date, the date on which those shareholders on the share register are entitled to the dividend.

Disclosure

	Year to	Year to
	31 December	31 December
	2024	2023
	£’000	£’000
Dividends paid in the year
Previous year’s second interim dividend – 1.9p (2023: 3.0p)	31,876	46,127
Current year’s interim dividend – 1.2p (2023: 2.0p)	19,767	31,636
Total	51,643	77,763

Dividends in respect of the year
Interim dividend – 1.2p (2023: 2.0p)	19,767	31,636
Second interim dividend – 0.5p (2023: 1.9p)	8,236	31,876
Total	28,003	63,512

The figures above include dividends elected to be reinvested through the DRIS.

The second interim dividend of 0.5p for the period ending 31 December 2024 will be paid on 29 May 2025 to shareholders on the register on 25 April 2025, this equates to 1% of the Company’s opening NAV per share.

7. Earnings per share

	Year to 31 December 2024			Year to 31 December 2023
	Revenue	Capital	Total	Revenue	Capital	Total
Loss attributable to Ordinary shareholders (£’000)	(2,811)	(144,838)	(147,649)	(2,851)	(146,648)	(149,499)
Loss per Ordinary share (p)	(0.2)p	(8.8)p	(9.0)p	(0.2)p	(9.7)p	(9.9)p

The total loss per share is based on 1,644,900,726 (2023: 1,506,111,802) Ordinary shares, being the weighted average number of Ordinary shares in issue during the year.

There are no potentially dilutive capital instruments in issue and so no diluted return per share figures are relevant. The basic and diluted earnings per share are therefore identical.

8. Net asset value per share

	31 December	31 December
	2024	2023
Net assets (£)	831,358,000	993,744,000
Ordinary shares in issue	1,647,212,355	1,593,601,092
NAV per share (p)	50.5	62.4

9. Transactions with the Manager and Portfolio Manager

Since 1 September 2017, Titan has been classified as a full-scope Alternative Investment Fund under the Alternative Investment Fund Management Directive (the ‘AIFM Directive’). As a result, since 1 September 2017, Titan’s investment management agreement was assigned by way of the deed of novation from Octopus Investments Limited to Octopus AIF Management Limited to act as Manager (an authorised alternative investment fund manager responsible for ensuring compliance with the AIFM Directive). Octopus AIF Management Limited has in turn appointed Octopus Investments Limited to act as Portfolio Manager to Titan (responsible for portfolio management and the day-to-day running of Titan).

Titan paid Octopus AIF Management Limited £19,079,000 (2023: £21,082,000) in the period as a management fee. The annual management charge (AMC) is based on 2% of Titan’s NAV in respect of existing funds but in respect of funds raised by Titan under the 2018 Offer and thereafter (and subject to Titan having a cash reserve of 10% of its NAV), the AMC on uninvested cash is the lower of either (i) the actual return that Titan receives on its cash and funds that are the equivalent of cash (which currently consist of corporate bonds and money market funds) subject to a 0% floor and (ii) 2% of Titan’s NAV. The AMC is payable quarterly in advance and calculated using the latest published NAV of Titan and the number of shares in issue at each quarter end.

Octopus provides non-investment services to the Company and receives a fee for these services which is capped at the lower of (i) 0.3% per annum of the Company’s NAV or (ii) the administration and accounting costs of the Company for the year ended 31 December 2020 with inflation increases in line with the Consumer Price Index. During the period, the Company paid £2,078,000 (2023: £2,020,000) to Octopus for the non‑investment services.

In addition, Octopus is entitled to performance-related incentive fees. The incentive fees were designed to ensure that there were significant tax-free dividend payments made to shareholders as well as strong performance in terms of capital and income growth, before any performance-related fee payment was made.

Due to performance in the year, the total value has decreased to 155.6p, representing a total loss of 8.8p. Therefore, the high water mark for the 2025 financial year remains at 197.7p.

If, on a subsequent financial year end, the performance value of Titan falls short of the high water mark on the previous financial year end, no performance fee will arise. If, on a subsequent financial year end, the performance exceeds the previous best high water mark of Titan, the Manager will be entitled to 20% of such excess in aggregate.

Octopus received £39,000 in the period to 31 December 2024 (2023: £36,000) in regard to arrangement and monitoring fees in relation to investments made on behalf of Titan. Since 31 October 2018, Octopus no longer receives such fees in respect of new investments or any such new fees in respect of further investments into portfolio companies in which Titan invested on or before 31 October 2018, with any such fees received after that time being passed to Titan.

The cap relating to Titan’s total ongoing charges ratio, that is the regular, recurring costs of Titan expressed as a percentage of its NAV, above which Octopus has agreed to pay, is 2.5%, and is calculated in accordance with the AIC Guidelines.

10. Related party transactions

Titan owns Zenith Holding Company Limited, which owns a share in Zenith LP, a fund managed by Octopus.

In the year, Octopus Investments Nominees Limited (OINL) has purchased Titan shares from shareholders to correct administrative issues, on the understanding that shares will be sold back to Titan in subsequent share buybacks. As at 31 December 2024, no Titan shares were held by OINL (2023: no shares) as beneficial owner. Throughout the period to 31 December 2024, OINL purchased 65,000 shares (2023: 1,883,000 shares) at a cost of £36,000 (2023: £1,563,000) and sold 65,000 shares (2023: 1,883,000 shares) for proceeds of £34,000 (2023: £1,353,000). This is classed as a related party transaction as Octopus, the Portfolio Manager, and OINL are part of the same group of companies. Any such future transactions, where OINL takes over the legal and beneficial ownership of Company shares, will be announced to the market and disclosed in annual and half‑yearly reports.

Several members of the Octopus investment team hold non-executive directorships as part of their monitoring roles in Titan’s portfolio companies, but they have no controlling interests in those companies.

Details of the Directors and their remuneration can be found in the Directors’ Remuneration Report.

The Directors received the following dividends from Titan:

	Year to	Year to
	31 December	31 December
	2024	2023
	£	£
Jane O’Riordan	4,766	6,901
Tom Leader	1,464	1,889
Lord Rockley	2,406	2,776
Julie Nahid Rahman	138	89
Gaenor Bagley Rupert Dickinson	738 —	901 —

11. 2024 financial information

The figures and financial information for the year ended 31 December 2024 are extracted from the Company’s annual financial statements for the period and do not constitute statutory accounts. The Company’s annual financial statements for the year to 31 December 2024 have been audited but have not yet been delivered to the Registrar of Companies. The Auditors’ report on the 2024 annual financial statements was unqualified, did not include a reference to any matter to which the auditors drew attention without qualifying the report, and did not contain any statements under Sections 498(2) or 498(3) of the Companies Act 2006.

12. 2023 financial information

The figures and financial information for the period ended 31 December 2023 are compiled from an extract of the published financial statements for the period and do not constitute statutory accounts. Those financial statements have been delivered to the Registrar of Companies and included the Auditors’ report which was unqualified, did not include a reference to any matter to which the auditors drew attention without qualifying the report, and did not contain any statements under Sections 498(2) or 498(3) of the Companies Act 2006.

13. Annual Report and financial statements

The Annual Report and financial statements will be posted to shareholders in early May and will be available on the Company’s website, octopustitanvct.com. The Notice of Annual General Meeting is contained within the Annual Report.

14. General information

Registered in England & Wales. Company No. 06397765
LEI: 213800A67IKGG6PVYW75

15. Directors

Tom Leader (Chair), Jane O’Riordan, Lord Rockley, Gaenor Bagley, Julie Nahid Rahman and Rupert Dickinson.

16. Secretary and registered office

Octopus Company Secretarial Services Limited
6^th Floor, 33 Holborn, London EC1N 2HT

The MIL Network –

April 29, 2025

MIL-Evening Report: Tarakinikini appointed as Fiji’s ambassador-designate to Israel

By Anish Chand in Suva

Filipo Tarakinikini has been appointed as Fiji’s Ambassador-designate to Israel.

This has been stated on two official X, formerly Twitter, handle posts overnight.

“#Fiji is determined to deepen its relations with #Israel as Fiji’s Ambassador-designate to Israel, HE Ambassador @AFTarakinikini prepares to present his credentials on 28 April, 2025,” stated the Fiji at UN twitter account.

Tarakinikini is also Fiji’s current Ambassador to the United Nations.

In a separate post, Deputy Director-General Eynat Shlein of Israel’s international development cooperation agency said she was “honoured” to meet Tarakinikini.

“We discussed the vast cooperation opportunities, promoting & enhancing sustainable development, emphasizing investment in capacity building & human capital,” she said on X.

Fiji is only the seventh country in the world to open an embassy in Israel.

Republished from The Fiji Times with permission.

Centre of controversy
Pacific Media Watch reports that Lieutenant-Colonel Tarakinikini was at the centre of controversy in Fiji in 2005 when he was declared a “deserter” by the Fiji military.

However, from 1979 to 2002, he served in the Fiji Military Forces, including eight years in United Nations peacekeeping missions, among them, south Lebanon and the Multinational Force in Sinai, Egypt.

Great honor to have have this timely briefing @EynatShlein, Ambassador Roi @IsraelMFA #Fiji is determined to deepen its relations with #Israel as Fiji’s Ambassador-designate to Israel, HE Ambassador @AFTarakinikini prepares to present his credentials on 28 April, 2025 🇮🇱 🤝 🇫🇯… https://t.co/mGPKjYM5Qc

— Fiji at the UN🇫🇯 (@FijiMissionUN) April 27, 2025

Beginning in 2003, he was the UN Department for Security and Safety’s (UNDSS) Chief Security Adviser in Jerusalem, as well as in Kathmandu, Nepal, from 2006 to 2008.

From 2008 to 2018, he served in numerous United Nations integrated assessment missions, programme working groups, restructuring and redeployments and technical assessment missions.

‘Weapons of war’
Yesterday, the International Court of Justice (ICJ) began week-long hearings at The Hague into global accusations of Israel using starvation and humanitarian aid as “weapons of war” and failing to meet its obligations to the Palestinian people in Gaza as the occupying power in its genocidal war on the besieged enclave.

Forty countries are expected to give evidence.

The ICJ has been tasked by the UN with providing an advisory opinion “on a priority basis and with the utmost urgency”.

Although the ICJ judges’ opinion is not binding, it provides clarity on legal questions.

In January 2024, the ICJ ruled that Israel must take “all measures” to prevent a genocide in Gaza.

Then in June, it said in an advisory opinion that Israel’s occupation of the West Bank, East Jerusalem and Gaza was illegal.

Both Israeli Prime Minister Benjamin Netanyahu and former Defence Minister Yoav Gallant are wanted on arrest warrants by the International Criminal Court (ICC) to face charges of war crimes and crimes against humanity.

MIL OSI Analysis – EveningReport.nz –

April 29, 2025
MIL-OSI Video: Why monetary policy should crack down harder during high inflation

Source: European Central Bank (video statements)

ECB Research Bulletin by Peter Karadi, Anton Nakov, Galo Nuño, Ernesto Pasten and Dominik Thaler.

Read more: https://www.ecb.europa.eu/press/research-publications/resbull/2025/html/ecb.rb250429~6f9636652d.en.html
The Research Bulletin features a selection of recent work on policy-relevant topics by ECB economists. Published on a monthly basis, the articles in the Research Bulletin are intended for a general audience.

The views expressed in each article are those of the authors and do not necessarily represent the views of the European Central Bank and the Eurosystem.

https://www.youtube.com/watch?v=lRr-Ys8TTxc

MIL OSI Video –

April 29, 2025

MIL-OSI Economics: Result of the Daily Variable Rate Repo (VRR) auction held on April 29, 2025

Source: Reserve Bank of India

Tenor	1-day
Notified Amount (in ₹ crore)	75,000
Total amount of bids received (in ₹ crore)	5,901
Amount allotted (in ₹ crore)	5,901
Cut off Rate (%)	6.01
Weighted Average Rate (%)	6.01
Partial Allotment Percentage of bids received at cut off rate (%)	NA

Ajit Prasad
Deputy General Manager
(Communications)

Press Release: 2025-2026/200

MIL OSI Economics –

April 29, 2025

MIL-OSI: BAWAG Group publishes Q1 2025 results: Net profit € 201 million and RoTCE 25.8%

Source: GlobeNewswire (MIL-OSI)

Today, BAWAG Group released its results for the first quarter 2025, reporting a net profit of € 201 million, earnings per share of € 2.54, and a RoTCE of 25.8%. Pre-provision profits were at € 336 million and the cost-income ratio at 37%. The first quarter 2025 represents the starting point as a larger group. After the closing of our most recent acquisition, Barclays Consumer Bank Europe, on February 1, 2025, the first quarter results include a full quarter of Knab and two months of Barclays Consumer Bank Europe.

The CET1 ratio was at 13.8%, in line with the pro-forma capital ratio at year-end 2024. This already considers the deduction of € 111 million dividend accrual for Q1 2025 as well as the self-funded acquisition of Barclays Consumer Bank Europe. On April 4, 2025, the Annual General Meeting approved the dividend for the financial year 2024 of € 5.50 per share, which was paid out on April 11, 2025. The NPL ratio was at 0.7% at the end of the first quarter, reflecting our consistently strong asset quality.

BAWAG Group also reconfirms the outlook for the financial year 2025 as well as its mid-term targets as presented on the investor day on March 4, 2025.

Anas Abuzaakouk, CEO, commented: “We delivered net profit of € 201 million, EPS of € 2.54, and a return on tangible common equity of 26% during the first quarter. The recent market volatility from the short-term impacts of changing tariffs and more long-term impacts on global trade will take some time to be fully understood. However, we have a solid foundation, a fortress balance sheet, and a leadership team that has worked together for over a decade navigating changing currents as we aim to be a source of strength for our customers and the communities we serve.”

The earnings presentation is available on https://www.bawaggroup.com.

Delivering strong results in the first quarter 2025 as a larger group

in € million	Q1 ’25	Q1 ‘24	Change vs prior year (in %)	Q4 ’24	Change vs prior quarter (in %)
Core revenues	534.8	392.8	36	449.6	19
Net interest income	445.8	317.1	41	368.4	21
Net commission income	89.0	75.7	18	81.2	10
Operating income	533.8	383.8	39	461.7	16
Operating expenses	(197.6)	(126.2)	57	(164.8)	20
Pre-provision profit	336.2	257.6	31	296.9	13
Regulatory charges	(9.6)	(5.2)	85	(4.3)	>100
Risk costs	(59.2)	(29.9)	98	1.4	—
Profit before tax	268.0	222.8	20	296.1	(9)
Net profit	201.0	166.9	20	240.0	(16)

RoTCE	25.8%	23.7%	2.1pts	31.6%	(5.8)pts
CIR	37%	32.9%	4.1pts	35.7%	1.3pts
Earnings per share (€)	2.54	2.11	20	3.03	(16)
Liquidity Coverage Ratio (LCR)	213%	217%	(4)pts	249%	(36)pts

Earnings presentation
BAWAG Group will host the earnings call with our CEO Anas Abuzaakouk and CFO Enver Sirucic at 10 a.m. CEST on 29 April 2025. The webcast details are available on our website under Financial Results | BAWAG Group.

About BAWAG Group
BAWAG Group AG is a publicly listed holding company headquartered in Vienna, Austria, serving our over 4 million retail, small business, corporate, real estate and public sector customers across Austria, Germany, Switzerland, Netherlands, Ireland, the United Kingdom, and the United States. The Group operates under various brands and across multiple channels offering comprehensive savings, payment, lending, leasing, investment, building society, factoring and insurance products and services. Our goal is to deliver simple, transparent, and affordable financial products and services that our customers need.

BAWAG Group’s Investor Relations website https://www.bawaggroup.com/ir contains further information, including financial and other information for investors.

Forward-looking statement
This release contains “forward-looking statements” regarding the financial condition, results of operations, business plans and future performance of BAWAG Group. Words such as “anticipates,” “believes,” “estimates,” “expects,” “forecasts,” “intends,” “plans,” “projects,” “may,” “will,” “should,” “would,” “could” and other similar expressions are intended to identify these forward-looking statements. These forward-looking statements reflect management’s expectations as of the date hereof and are subject to risks and uncertainties that may cause actual results to differ materially from those projected. These risks and uncertainties include, but are not limited to, economic conditions, the regulatory environment, loan concentrations, vendors, employees, technology, competition, and interest rates. Readers are cautioned not to place undue reliance on the forward-looking statements as actual results may differ materially from the results predicted. Neither BAWAG Group nor any of its affiliates, advisors or representatives shall have any liability whatsoever (in negligence or otherwise) for any loss howsoever arising from any use of this report or its content or otherwise arising in connection with this document. This report does not constitute an offer or invitation to purchase or subscribe for any securities and neither it nor any part of it shall form the basis of or be relied upon in connection with any contract or commitment whatsoever. This statement is included for the express purpose of invoking “safe harbor provisions”.

Financial Community:
Jutta Wimmer (Head of Investor Relations)
Tel: +43 (0) 5 99 05-22474

IR Hotline: +43 (0) 5 99 05-34444
E-mail: investor.relations@bawaggroup.com

Media:
Manfred Rapolter (Head of Corporate Communications & Social Engagement)
Tel: +43 (0) 5 99 05-31210
E-mail: communications@bawaggroup.com

This text can also be downloaded from our website: https://www.bawaggroup.com

The MIL Network –

April 29, 2025

MIL-OSI China: Announcement on Open Market Operations No.82 [2025]

Source: Peoples Bank of China

Announcement on Open Market Operations No.82 [2025]

(Open Market Operations Office, April 29, 2025)

The People’s Bank of China conducted reverse repo operations in the amount of RMB340.5 billion through quantity bidding at a fixed interest rate on April 29, 2025.

Details of the Reverse Repo Operations

Maturity

Rate

Bidding Volume

Winning Bid Volume

7 days

1.50%

RMB340.5 billion

RMB340.5 billion

Date of last update Nov. 29 2018

2025年04月29日

MIL OSI China News –

April 29, 2025
MIL-OSI Submissions: Amnesty International warns of global human rights crisis as ‘Trump effect’ accelerates destructive trends
Source: Amnesty International

Annual report highlights the creep of authoritarian practices and vicious clampdowns on dissent around the world

President Trump’s first 100 days intensify 2024’s global regressions and deep-rooted trends

Global failures in addressing inequalities, climate collapse, and tech transformations imperil future generations

The rise of authoritarian practices and annihilation of international law are not inevitable: people do and will resist attacks on human rights; governments can deliver international justice and must continue to do so.

The Trump administration’s anti-rights campaign is turbocharging harmful trends already present, gutting international human rights protections and endangering billions across the planet, Amnesty International warned today upon launching its annual report, The State of the World’s Human Rights.

This “Trump effect” has compounded the damage done by other world leaders throughout 2024, eating away at decades of painstaking work to build up and advance universal human rights for all and accelerating humanity’s plunge into a brutal new era characterized by intermingling authoritarian practices and corporate greed, Amnesty International said in its assessment of the situation in 150 countries.

“Year after year, we have warned of the dangers of human rights backsliding. But events of the past 12 months – not least Israel’s livestreamed but unheeded genocide of Palestinians in Gaza – have laid bare just how hellish the world can be for so many when the most powerful states jettison international law and disregard multilateral institutions. At this historical juncture, when authoritarian laws and practices are multiplying the world over in the interests of very few, governments and civil society must work with urgency to lead humanity back to safer ground,” said Agnès Callamard, Amnesty International’s Secretary General.

The State of the World’s Human Rights documents vicious, widespread clampdowns on dissent, catastrophic escalations of armed conflict, inadequate efforts to address climate collapse, and a growing backlash globally against the rights of migrants, refugees, women, girls and LGBTI people. Each of these faces further deterioration in a turbulent 2025 unless a global about-turn is achieved.

“One hundred days into his second term, President Trump has shown only utter contempt for universal human rights. His government has swiftly and deliberately targeted vital US and international institutions and initiatives that were designed to make ours a safer and fairer world. His all-out assault on the very concepts of multilateralism, asylum, racial and gender justice, global health and life-saving climate action is exacerbating the significant damage those principles and institutions have already sustained and is further emboldening other anti-rights leaders and movements to join his onslaught,” Agnès Callamard added.

“But let us be clear: this sickness runs much deeper than the actions of President Trump. For years now, we’ve witnessed a creeping spread of authoritarian practices among states the world over, fostered by aspiring and elected leaders willingly acting as engines of destruction. As they drag us into a new age of turmoil and cruelty, all who believe in freedom and equality must steel ourselves to counter increasingly extreme attacks on international law and universal human rights.”

The proliferation of authoritarian laws, policies and practices targeting freedom of expression, association and peaceful assembly that Amnesty International documented in 2024 was central to the global backlash against human rights. Governments across the world sought to evade accountability, entrench their power and instil fear by banning media outlets, by disbanding or suspending NGOs and political parties, by imprisoning critics on baseless charges of “terrorism” or “extremism”, and by criminalizing human rights defenders, climate activists, Gaza solidarity protesters and other dissenters.

Security forces in several countries used mass arbitrary arrests, enforced disappearances and often excessive – sometimes lethal – force to suppress civil disobedience. Bangladeshi authorities issued “shoot-on-sight” orders against student protests, resulting in almost 1,000 deaths, while security forces in Mozambique unleashed the worst crackdown on protests in years following disputed elections, leaving at least 277 people dead.

Türkiye imposed blanket bans on protests and continues to use unlawful and indiscriminate force against peaceful demonstrators, but people power prevailed in South Korea when president Yoon Suk Yeol suspended certain human rights and declared martial law, only to be removed from office and see those measures overturned after massive public protests.

Armed conflicts highlight repeated failures

As conflicts multiplied or escalated, state forces and armed groups acted brazenly, committing war crimes and other serious violations of international humanitarian law that devastated the lives of millions.

Amnesty International documented Israel’s genocide against Palestinians in Gaza in a landmark reportand its system of apartheid and unlawful occupation in the West Bank turned increasingly violent. Meanwhile, Russia killed more Ukrainian civilians in 2024 than it did the year before, continuing to target civilian infrastructure and subjecting detainees to torture and enforced disappearance.

Sudan’s Rapid Support Forces inflicted widespread sexual violence on women and girls, in what amounts to war crimes and possible crimes against humanity, while the number of people internally displaced by Sudan’s two-year civil war rose to 11 million – more than anywhere else on earth. Yet that conflict elicited near-total global indifference – aside from cynical actors exploiting opportunities to breach the Darfur arms embargo.

The Rohingya continued to face racist attacks in Myanmar, causing many to flee their homes in Rakhine state. The Trump administration’s massive foreign aid cuts have since aggravated the situation, causing the closure of hospitals in refugee camps in neighbouring Thailand, exposing fleeing human rights defenders to risk of deportation and imperilling programmes helping people survive the conflict.

The initial suspension of US foreign aid also impacted health services and support for children forcibly separated from their families at detention camps in Syria, and the abrupt cuts have shut down lifesaving programmes in Yemen, including malnutrition treatment for children, pregnant and breastfeeding mothers, safe shelters for survivors of gender-based violence, and healthcare for children suffering from cholera and other illnesses.

“Amnesty International has long warned of double standards undermining the rules-based order. The impact of that to-date unfettered backsliding plumbed new depths in 2024, from Gaza to the Democratic Republic of Congo. Having paved the way for this mess by failing to universally uphold the rule of law, the international community must now shoulder the responsibility,” said Agnès Callamard.

“The cost of these failures is gargantuan, namely the loss of vital protections built to safeguard humanity after the horrors of the Holocaust and World War Two. Despite its many imperfections, obliteration of the multilateral system is no answer. It must be strengthened and reimagined. Yet, having seen it sustain further damage in 2024, today the Trump administration appears intent on taking a chainsaw to the remnants of multilateral cooperation in order to reshape our world through a transactional doctrine steeped in greed, callous self-interest and dominance of the few.”

Governments are abandoning future generations

The State of the World’s Human Rights presents stark evidence that the world is condemning future generations to an ever-harsher existence thanks to collective failures to tackle the climate crisis, reverse ever-deepening inequalities and restrain corporate power.

COP29 was a catastrophe, with a record number of fossil fuel lobbyists inhibiting progress on a fair phase-out, while the wealthiest countries bullied lower-income nations into accepting derisory climate financing agreements. President Trump’s reckless decision to abandon the Paris Agreement and his “drill, baby drill” refrain have only compounded these failings and could encourage others to follow suit.

“2024 was the hottest year on record and the first to exceed 1.5°C above pre-industrial levels. The floods that devastated South Asia and Europe, the droughts that ravaged Southern Africa, the fires that razed swathes of Amazon rainforest and the hurricanes that wreaked havoc in the USA laid bare the immense human cost of global heating, even at its current levels. With a 3°C rise projected this century, richer nations know they’re not immune from increasingly extreme unnatural disasters – as the recent California wildfires drove home – but will they act?” said Agnès Callamard.

In 2024, extreme poverty and inequality within and between states continued to deepen due to widespread inflation, poor corporate regulation, pervasive tax abuse and rising national debts. Yet many governments and political movements used racist and xenophobic rhetoric to scapegoat migrants and refugees for crime and economic stagnation. Meanwhile, the number and wealth of billionaires grew, even as the World Bank warned of “a lost decade” in global poverty reduction.

The future looks far bleaker for many women, girls and LGBTI people, amid intensifying attacks on gender equality and identity. The Taliban imposed even-more-draconian restrictions on women’s public existence in Afghanistan, while Iranian authorities intensified their brutal crackdown on women and girls who defy compulsory veiling. Groups of women searching for missing loved ones in Mexico and Colombia faced all manner of threats and attacks.

Malawi, Mali and Uganda took steps to criminalize or uphold bans on same-sex relations between consenting adults, while Georgia and Bulgaria followed Russia’s lead in clamping down on supposed “LGBTI propaganda”. The Trump administration is bolstering the global backlash against gender justice by dismantling efforts to tackle discrimination, relentlessly attacking transgender rights, and ending funding for health, education and other programmes that supported women and girls all over the world.

Governments are further harming present and future generations by failing to adequately regulate new technologies, abusing surveillance tools and entrenching discrimination and inequalities through increased use of artificial intelligence.

Tech firms have long facilitated discriminatory and authoritarian practices, but President Trump has exacerbated this trend, encouraging social media companies to roll back protections – including Meta’s removal of third-party fact-checking – and double down on a business model that enables the spread of hateful and violent content. The alignment between the Trump administration and tech billionaires also risks opening the door to an era of rampant corruption, disinformation, impunity and corporate capture of state power.

“From seating tech billionaires in prime position at his inauguration to granting the world’s richest man unprecedented access to the US government apparatus, it appears that President Trump will let his self-serving and corporate allies run amok, without the slightest regard for human rights or even the rule of law,” said Agnès Callamard.

Vital efforts to uphold international justice

Despite mounting opposition from powerful states – compounded this year by the Trump administration’s shameless sanctions against the ICC prosecutor – international justice and multilateral bodies have continued to push for accountability at the highest levels, with governments from the Global South leading several significant initiatives.

The ICC issued arrest warrants against senior state officials and leaders of armed groups in Israel, Gaza, Libya, Myanmar and Russia. The UN took an important step towards negotiating a much-needed treaty on crimes against humanity and the Philippines followed suit by arresting former president Rodrigo Duterte last month under an ICC warrant for the crime against humanity of murder.

The International Court of Justice (ICJ) issued three sets of provisional measure orders in the case South Africa brought against Israel under the Genocide Convention and issued an advisory opinion declaring that Israel’s occupation of Palestinian territory, including East Jerusalem, is unlawful. The UN General Assembly also passed a resolution calling on Israel to end its occupation, and in January 2025 eight states from the Global South formed the Hague Group, a collective committed to preventing arms transfers to Israel and holding it accountable for violations of international law.

“We applaud the efforts of nations like South Africa and international justice bodies to push back against powerful states hellbent on undermining international law. In so challenging impunity, those nations and bodies set examples for the whole world to follow. The mounting attacks we’ve witnessed on the ICC in recent months suggest this is emerging as a major battlefield of 2025. All governments must do everything in their power to support international justice, hold perpetrators accountable, and protect the ICC and its staff from sanctions,” said Agnès Callamard.

“Despite daunting challenges, the destruction of human rights is far from inevitable. History abounds with examples of brave people overcoming authoritarian practices. In 2024 the people of several nations rejected anti-rights leaders at the ballot box while millions around the world raised their voices against injustice. So it’s clear: no matter who stands in our way, we must – and we will – continue to resist the reckless regimes of power and profit that seek to strip people of their human rights. Our vast, unshakeable movement will be forever united in our common belief in the inherent dignity and human rights of everyone on this planet.”
MIL OSI – Submitted News –
April 29, 2025

MIL-OSI Economics: Money Market Operations as on April 28, 2025

Source: Reserve Bank of India


(Amount in ₹ crore, Rate in Per cent)

	Volume (One Leg)	Weighted Average Rate	Range
A. Overnight Segment (I+II+III+IV)	6,09,110.25	5.77	0.01-6.30
I. Call Money	15,719.99	5.87	4.95-5.95
II. Triparty Repo	4,01,754.30	5.75	5.70-5.85
III. Market Repo	1,89,873.96	5.82	0.01-6.30
IV. Repo in Corporate Bond	1,762.00	5.99	5.95-6.00
B. Term Segment
I. Notice Money**	788.85	5.93	5.25-6.05
II. Term Money^@@	1,120.00	–	6.15-6.50
III. Triparty Repo	9,188.00	5.90	5.80-6.00
IV. Market Repo	195.04	6.25	6.25-6.25
V. Repo in Corporate Bond	0.00	–	–

	Auction Date	Tenor (Days)	Maturity Date	Amount	Current Rate / Cut off Rate
C. Liquidity Adjustment Facility (LAF), Marginal Standing Facility (MSF) & Standing Deposit Facility (SDF)
I. Today’s Operations
1. Fixed Rate
2. Variable Rate^&
(I) Main Operation
(a) Repo
(b) Reverse Repo
(II) Fine Tuning Operations
(a) Repo	Mon, 28/04/2025	1	Tue, 29/04/2025	4,998.00	6.01
(b) Reverse Repo
(III) Long Term Operations^{^}
(a) Repo
(b) Reverse Repo
3. MSF^#	Mon, 28/04/2025	1	Tue, 29/04/2025	3,190.00	6.25
4. SDF^Δ#	Mon, 28/04/2025	1	Tue, 29/04/2025	1,32,959.00	5.75
5. Net liquidity injected from today’s operations [injection (+)/absorption (-)]*				-1,24,771.00
II. Outstanding Operations
1. Fixed Rate
2. Variable Rate^&
(I) Main Operation
(a) Repo
(b) Reverse Repo
(II) Fine Tuning Operations
(a) Repo
(b) Reverse Repo
(III) Long Term Operations^{^}
(a) Repo	Thu, 17/04/2025	43	Fri, 30/05/2025	25,731.00	6.01
(b) Reverse Repo
3. MSF^#
4. SDF^Δ#
D. Standing Liquidity Facility (SLF) Availed from RBI^$				8,701.02
E. Net liquidity injected from outstanding operations [injection (+)/absorption (-)]*				34,432.02
F. Net liquidity injected (outstanding including today’s operations) [injection (+)/absorption (-)]*				-90,338.98
G. Cash Reserves Position of Scheduled Commercial Banks
(i) Cash balances with RBI as on		April 28, 2025		9,36,260.05
(ii) Average daily cash reserve requirement for the fortnight ending		May 02, 2025		9,51,938.00
H. Government of India Surplus Cash Balance Reckoned for Auction as on^¥		April 28, 2025		4,998.00
I. Net durable liquidity [surplus (+)/deficit (-)] as on		April 04, 2025		2,36,088.00
^@ Based on Reserve Bank of India (RBI) / Clearing Corporation of India Limited (CCIL).
– Not Applicable / No Transaction.
** Relates to uncollateralized transactions of 2 to 14 days tenor.
^@@ Relates to uncollateralized transactions of 15 days to one year tenor.
^$ Includes refinance facilities extended by RBI.
^& As per the Press Release No. 2019-2020/1900 dated February 06, 2020.
^Δ As per the Press Release No. 2022-2023/41 dated April 08, 2022.
* Net liquidity is calculated as Repo+MSF+SLF-Reverse Repo-SDF.
^¥ As per the Press Release No. 2014-2015/1971 dated March 19, 2015.
^# As per the Press Release No. 2023-2024/1548 dated December 27, 2023.
^{^} As per the Press Release No. 2025-2026/91 dated April 11, 2025.
Ajit Prasad Deputy General Manager (Communications)
Press Release: 2025-2026/199

MIL OSI Economics –

April 29, 2025

MIL-Evening Report: ER Report: A Roundup of Significant Articles on EveningReport.nz for April 29, 2025

ER Report: Here is a summary of significant articles published on EveningReport.nz on April 29, 2025.

Why are political parties allowed to send spam texts? And how can we make them stop?
Source: The Conversation (Au and NZ) – By Tegan Cohen, Postdoctoral Research Fellow, Digital Media Research Centre, Queensland University of Technology Ti Wi / Unsplash Another election, another wave of unsolicited political texts. Over this campaign, our digital mailboxes have been stuffed with a slew of political appeals and promises, many from the new party

The Oscars have rolled out the red carpet for generative AI. And surprisingly, viewers don’t seem to mind
Source: The Conversation (Au and NZ) – By Paul Crosby, Senior Lecturer, Department of Economics, Macquarie University The Oscars have entered the age of artificial intelligence (AI). Last week the Academy of Motion Picture Arts and Sciences explicitly said, for the first time, films using generative AI tools will not be disqualified from the awards.

Echidna ancestors lived watery lifestyles like platypuses 100 million years ago – new study
Source: The Conversation (Au and NZ) – By Sue Hand, Professor Emeritus, Palaeontology, UNSW Sydney Mary_May/Shutterstock As the world’s only surviving egg-laying mammals, Australasia’s platypus and four echidna species are among the most extraordinary animals on Earth. They are also very different from each other. The platypus is well adapted for a semi-aquatic lifestyle, spending

‘Do something about it before it gets worse’: young people want government action on gambling reform
Source: The Conversation (Au and NZ) – By Hannah Pitt, Senior Research Fellow – Institute for Health Transformation, Deakin University David P. Smith/Shutterstock Do something about it before it gets worse. This was a response from a 16-year-old boy in one of our recent studies when asked what he would say to the prime minister

‘I’m always afraid for the future of my family’: why it’s too hard for some refugees to reunite with loved ones
Source: The Conversation (Au and NZ) – By Mary Anne Kenny, Associate Professor, School of Law, Murdoch University When refugees flee their home country due to war, violence, conflict or persecution, they are often forced to leave behind their families. For more than 30,000 people who have sought asylum in Australia since arriving more than

Major survey finds most people use AI regularly at work – but almost half admit to doing so inappropriately
Source: The Conversation (Au and NZ) – By Nicole Gillespie, Professor of Management; Chair in Trust, Melbourne Business School Matheus Bertelli/Pexels Have you ever used ChatGPT to draft a work email? Perhaps to summarise a report, research a topic or analyse data in a spreadsheet? If so, you certainly aren’t alone. Artificial intelligence (AI) tools

1 billion years ago, a meteorite struck Scotland and influenced life on Earth
Source: The Conversation (Au and NZ) – By Chris Kirkland, Professor of Geochronology, Curtin University Stoer Head lighthouse, Scotland. William Gale/Shutterstock We’ve discovered that a meteorite struck northwest Scotland 1 billion years ago, 200 million years later than previously thought. Our results are published today in the journal Geology. This impact now aligns with some

Arsenic is everywhere – but new detection methods could help save lives
Source: The Conversation (Au and NZ) – By Magdalena Wajrak, Senior Lecturer in Chemistry, Edith Cowan University Arsenic is a nasty poison that once reigned as the ultimate weapon of deception. In the 18th century, it was the poison of choice for those wanting to kill their enemies and spouses, favoured for its undetectable nature

Forming new habits can take longer than you think. Here are 8 tips to help you stick with them
Source: The Conversation (Au and NZ) – By Ben Singh, Research Fellow, Allied Health & Human Performance, University of South Australia SarahMcEwan/Shutterstock If you’ve ever tried to build a new habit – whether that’s exercising more, eating healthier, or going to bed earlier – you may have heard the popular claim that it only takes

‘Complaining is career suicide’: the hidden mental health crisis turning our screen industry upside down
Source: The Conversation (Au and NZ) – By Peter Hegedus, Associate Professor, Griffith Film School, Griffith University Shutterstock The Australian screen industry is often associated with fun, creativity and perhaps even glamour. But our new Pressure Point Report reveals a more troubling reality: a pervasive mental health crisis, which could see the screen industry lose

New survey shows business outlook is weakening and uncertainty rising as the trade war bites
Source: The Conversation (Au and NZ) – By John Simon, Adjunct Fellow in Economics, Macquarie University Vivid Brands/Shutterstock Uncertainty is everywhere these days. There is even uncertainty about the uncertainty. The Reserve Bank of Australia, for example, noted in the minutes from its April 1 meeting: The most significant development in the period leading up

How ICE is becoming a secret police force under the Trump administration
Source: The Conversation (Au and NZ) – By Lee Morgenbesser, Associate Professor, School of Government and International Relations, Griffith University Secret police are a quintessential feature of authoritarian regimes. From Azerbaijan’s State Security Service to Zimbabwe’s Central Intelligence Organisation, these agencies typically target political opponents and dissidents through covert surveillance, imprisonment and physical violence. In

Democracy on display or a public eyesore? The case for cracking down on election corflutes
Source: The Conversation (Au and NZ) – By Andrew Hughes, Lecturer in Marketing, Research School of Management, Australian National University In my time researching political advertising, one common communication method that often generates complaints is the proliferation of campaign corflutes. Politicians love them. Not so, many members of the general public. People are so fed

Here’s how to make your backyard safer and cooler next summer
Source: The Conversation (Au and NZ) – By Pui Kwan Cheung, Research Fellow in Urban Microclimates, The University of Melbourne Varavin88, Shutterstock Our backyards should be safe and inviting spaces all year round, including during the summer months. But the choices we make about garden design and maintenance, such as whether to have artificial turf

Five ways to make cities more resilient to climate change
Source: The Conversation (Au and NZ) – By Paul O’Hare, Lecturer in Human Geography and Urban Development, Manchester Metropolitan University John_T/Shutterstock Climate breakdown poses immense threats to global economies, societies and ecosystems. Adapting to these impacts is urgent. But many cities and countries remain chronically unprepared in what the UN calls an “adaptation gap”. Building

Politics with Michelle Grattan: pollster Kos Samaras on how voters are leaving the major parties behind
Source: The Conversation (Au and NZ) – By Michelle Grattan, Professorial Fellow, University of Canberra As we enter the final days of campaigning, Labor leads with its nose in front on most polls, but the devil is in the detail of particular seats. To help get a read on what the voters are feeling at

Vanuatu communities growing climate resilience in wake of Cyclone Lola
Communities in Vanuatu are learning to grow climate resilient crops, 18 months after Cyclone Lola devastated the country. The category 5 storm struck in October 2023, generating wind speeds of up to 215 kmph, which destroyed homes, schools, plantations, and left at least four people dead. It was all the worse for following twin cyclones

Election Diary: Labor to slash more consultant costs and increase visa charges to pay for fresh election commitments
Source: The Conversation (Au and NZ) – By Michelle Grattan, Professorial Fellow, University of Canberra The government has dug out last-minute savings of more than A$7 billion, to ensure its election commitments are more than offset in every year of the forward estimates. Its costings, released Monday, include savings of $6.4 billion from further reducing

Big and small spending included in Labor costings, but off-budget items yet to be revealed
Source: The Conversation (Au and NZ) – By Stephen Bartos, Professor of Economics, University of Canberra The federal budget will be stronger than suggested in last month’s budget, according to Treasurer Jim Chalmers who released Labor’s costings on Monday. Many of the policies included in the costings were already detailed in either the 2025 Budget

How much do election promises cost? And why have we had to wait so long to see the costings?
Source: The Conversation (Au and NZ) – By Stephen Bartos, Professor of Economics, University of Canberra With the May 3 federal election less than a week away, voters have only just received Labor’s costings and are yet to hear from the Coalition. At the 2022 election, the costings were not released for nearly two months

MIL OSI Analysis – EveningReport.nz –

April 29, 2025
MIL-OSI: GBank Financial Holdings Inc. Announces Uplisting to Nasdaq Capital Market

Source: GlobeNewswire (MIL-OSI)

LAS VEGAS, April 28, 2025 (GLOBE NEWSWIRE) — GBank Financial Holdings Inc. (the “Company”) (OTCQX: GBFH), the parent company of GBank (the “Bank”), announced today that its shares of common stock have been approved for listing on the Nasdaq Capital Market and are expected to commence trading on April 30, 2025, under the ticker symbol “GBFH.” The Company’s shares will continue to trade on the OTCQX until trading on Nasdaq commences. Shareholders are not required to take any action as a result of the uplisting, and the Company’s ticker symbol “GBFH” will remain unchanged.

Edward M. Nigro, Executive Chairman, added, “Trading on the NASDAQ Capital Market culminates our efforts to provide shareholders with liquidity and consequential share value—thank you for believing in us and supporting us these many years—we look forward to many more.”

T. Ryan Sullivan, President and CEO of GBank Financial Holdings Inc., stated, “Our Nasdaq uplisting is more than a milestone—this moment affirms the strength of our strategy, the determination of our team, and the trust our shareholders have placed in us.”

Click here to learn more about GBank Financial Holdings Inc.

Notice Regarding Disclosures and Forward-Looking Statements

This press release contains forward-looking statements within the meaning of applicable securities laws, including, but not limited to, any statements related to the listing, uplisting or trading of the Company’s common stock on the Nasdaq Capital Market. Forward-looking statements may generally be identified by the use of words such as “anticipates,” “expects,” “intends,” “plans,” “should,” “could,” “would,” “may,” “will,” “believes,” “estimates,” “potential,” “target,” or “continue,” and variations or similar expressions. These statements are based upon the current expectations and beliefs of management and are subject to certain risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. These risks and uncertainties include but are not limited to: changes in general economic conditions; potential recessionary impacts; market fluctuations; increased competition for deposits; regulatory changes affecting the banking industry; interest rate fluctuations; inflationary pressures; political instability; cybersecurity threats; severe weather or natural disasters; and the development and adoption of emerging technologies.

Although the Company believes that the assumptions underlying these forward-looking statements are reasonable, no assurance can be given that the results contemplated will be achieved. Due to these and other risks and uncertainties, readers are cautioned not to place undue reliance on these forward-looking statements. All forward-looking statements are made as of the date of this press release, and the Company does not undertake any obligation to update them to reflect new information or future events, except as required by law. All forward-looking statements included in the press release are qualified in their entirety by this cautionary statement.

Source: GBank Financial Holdings Inc.

The MIL Network –

April 29, 2025
MIL-OSI Submissions: African Development Bank signs $3.2 billion Exposure Exchange with Inter-American Development Bank

Source: African Development Bank Group (AfDB)

Since 2015, the African Development Bank has used these agreements to diversify lending within its sovereign portfolio and deploy capital effectively while preserving a resilient financial base.

WASHINGTON D.C., United States of America, April 28, 2025/ — The African Development Bank Group (www.AfDB.org) has signed a $3.2 billion Exposure Exchange Agreement with the Inter-American Development Bank (IADB), renewing a prior agreement originally executed between the two institutions in 2015. The agreement was signed in Washington DC, on the sidelines of the World Bank Group and International Monetary Fund Spring meetings.

This is the fourth exposure exchange undertaken by the African Development Bank with other Multilateral Development Banks, in the continuous pursuit of innovative ways of strengthening the capital adequacy and efficiency of Multilateral Development Banks, as well as boost their development lending capacity.

Since 2015, the African Development Bank has used these agreements to diversify lending within its sovereign portfolio and deploy capital effectively while preserving a resilient financial base. The tool ensures the African Development Bank remains agile, well-capitalized, and committed to innovation in support of development in Africa.

Today’s transaction follows previous successful agreements between the African Development Bank and other Multilateral Development Banks, including the International Bank for Reconstruction and Development and Asian Development Bank.

The African Development Bank President Dr Akinwumi Adesina said, “This transaction underpins the African Development Bank’s forward-looking approach to capital and risk management.”

“We are pleased to continue our positive longstanding collaboration with Inter-American Development Bank in structuring and executing innovative financial solutions to align with the G20’s call for Multilateral Development Banks to work together as a system in expanding development impact to our member countries,” said Adesina.

Inter-American Development Bank President Ilan Goldfajn pointed to the success of the first agreement signed with the African Development Bank ten years ago. He said, “This new agreement marks yet another milestone in our strong and fruitful collaboration with the African Development Bank. Thanks to this operation we’re strengthening the financial resilience, creditworthiness, and financing capacity of both of our institutions. A win-win for all, that will benefit the people of Latin America and the Caribbean and Africa”.

Adesina added that Multilateral Development Banks should do more of such transactions because of their proven success and impact.

MIL OSI – Submitted News –

April 29, 2025

MIL-OSI: Five Star Bancorp Announces First Quarter 2025 Results

Source: GlobeNewswire (MIL-OSI)

RANCHO CORDOVA, Calif., April 28, 2025 (GLOBE NEWSWIRE) — Five Star Bancorp (Nasdaq: FSBC) (“Five Star” or the “Company”), a holding company that operates through its wholly owned banking subsidiary, Five Star Bank (the “Bank”), today reported net income of $13.1 million for the three months ended March 31, 2025, as compared to $13.3 million for the three months ended December 31, 2024 and $10.6 million for the three months ended March 31, 2024.

First Quarter Highlights

Performance and operating highlights for the Company for the periods noted below included the following:

	Three months ended
(in thousands, except per share and share data)	March 31, 2025			December 31, 2024			March 31, 2024
Return on average assets (“ROAA”)		1.30	%		1.31	%		1.22	%
Return on average equity (“ROAE”)		13.28	%		13.48	%		14.84	%
Pre-tax income	$	18,391		$	19,367		$	14,961
Pre-tax, pre-provision income⁽¹⁾	$	20,291		$	20,667		$	15,861
Net income	$	13,111		$	13,317		$	10,631
Basic earnings per common share	$	0.62		$	0.63		$	0.62
Diluted earnings per common share	$	0.62		$	0.63		$	0.62
Weighted average basic common shares outstanding		21,209,881			21,182,143			17,190,867
Weighted average diluted common shares outstanding		21,253,588			21,235,318			17,272,994
Shares outstanding at end of period		21,329,235			21,319,083			17,353,251

⁽¹⁾ See the section entitled “Non-GAAP Reconciliation (Unaudited)” for a reconciliation of this non-GAAP financial measure.

James E. Beckwith, President and Chief Executive Officer, commented:

“The strength of Five Star Bank’s first quarter 2025 financial results is emblematic of a reputation built on an unwavering commitment to customers and community partners who rely on our speed to serve and certainty of execution for their own successes. This differentiated customer experience has created great demand for our services and seized market opportunities in San Francisco. As we continue to grow our presence, we now have 31 San Francisco Bay Area employees. As of March 31, 2025 our San Francisco Bay Area operations had $379.8 million in total deposits.

At the Company level, total loans held for investment increased by $89.1 million, or 2.52% (10.09% when annualized). Total deposits increased by $178.4 million, or 5.01% (20.05% when annualized), with wholesale deposits increasing by $130.0 million, or 23.21%, and non-wholesale deposits increasing by $48.4 million, or 1.61%. Short-term borrowings remained at zero as of March 31, 2025 and December 31, 2024. Net interest margin increased by nine basis points to 3.45% and our efficiency ratio increased to 42.58%, as compared to 41.21% for the fourth quarter of 2024, while cost of funds decreased nine basis points to 2.56%.

In the first quarter of 2025, we were pleased to declare another cash dividend of $0.20 per share. We were also pleased to have been ranked third among best-performing banks in the nation by S&P Global Market Intelligence (among banks with assets between $3 billion and $10 billion).

As we execute on the expansion of industry verticals and our presence in new geographies to meet customer demand, we expect the ongoing acceleration of our growth to benefit our customers, employees, and shareholders. We also expect our demonstrated ability to adapt to changing economic conditions to serve us well into the future as we remain vigilant and focused on disciplined business practices. We thank our employees for their outstanding commitment to ensuring Five Star Bank remains a safe, trusted, and steadfast banking partner.”

Financial highlights during the quarter included the following:

The San Francisco Bay Area team increased from 27 to 31 employees who generated deposit balances totaling $379.8 million at March 31, 2025, an increase of $87.4 million from December 31, 2024.
Cash and cash equivalents were $452.6 million, representing 12.11% of total deposits at March 31, 2025, as compared to 9.90% at December 31, 2024.
Total deposits increased by $178.4 million, or 5.01%, during the three months ended March 31, 2025, due to increases in both non-wholesale and wholesale deposits, which the Company defines as brokered deposits and California Time Deposit Program deposits. During the three months ended March 31, 2025, non-wholesale deposits increased by $48.4 million, or 1.61%, and wholesale deposits increased by $130.0 million, or 23.21%.
The Company had no short-term borrowings at March 31, 2025 or December 31, 2024.
Consistent, disciplined management of expenses contributed to our efficiency ratio of 42.58% for the three months ended March 31, 2025, as compared to 41.21% for the three months ended December 31, 2024.
For the three months ended March 31, 2025, net interest margin was 3.45%, as compared to 3.36% for the three months ended December 31, 2024 and 3.14% for the three months ended March 31, 2024. The effective Federal Funds rate was 4.33% as of March 31, 2025, remaining constant from December 31, 2024 and decreasing from 5.33% at March 31, 2024.
Other comprehensive income was $0.7 million during the three months ended March 31, 2025. Unrealized losses, net of tax effect, on available-for-sale securities were $11.6 million as of March 31, 2025. Total carrying value of held-to-maturity and available-for-sale securities represented 0.06% and 2.35% of total interest-earning assets, respectively, as of March 31, 2025.
The Company’s common equity Tier 1 capital ratio was 11.00% and 11.02% as of March 31, 2025 and December 31, 2024, respectively. The Bank continues to meet all requirements to be considered “well-capitalized” under applicable regulatory guidelines.
Loan and deposit growth in the three and twelve months ended March 31, 2025 was as follows:

(in thousands)	March 31, 2025		December 31, 2024		$ Change		% Change
Loans held for investment	$	3,621,819	$	3,532,686	$	89,133	2.52	%
Non-interest-bearing deposits		933,652		922,629		11,023	1.19	%
Interest-bearing deposits		2,802,702		2,635,365		167,337	6.35	%

(in thousands)	March 31, 2025		March 31, 2024		$ Change		% Change
Loans held for investment	$	3,621,819	$	3,104,130	$	517,689	16.68	%
Non-interest-bearing deposits		933,652		817,388		116,264	14.22	%
Interest-bearing deposits		2,802,702		2,138,384		664,318	31.07	%

The ratio of nonperforming loans to loans held for investment at period end remained at 0.05% from December 31, 2024 to March 31, 2025.
The Company’s Board of Directors declared on January 16, 2025, and the Company subsequently paid, a cash dividend of $0.20 per share during the three months ended March 31, 2025. The Company’s Board of Directors subsequently declared another cash dividend of $0.20 per share on April 17, 2025, which the Company expects to pay on May 12, 2025 to shareholders of record as of May 5, 2025.

Summary Results

Three months ended March 31, 2025, as compared to three months ended December 31, 2024

The Company’s net income was $13.1 million for the three months ended March 31, 2025, as compared to $13.3 million for the three months ended December 31, 2024. Net interest income increased by $0.5 million, primarily due to a decrease in interest expense due to lower average rates on deposits, partially offset by a decrease in interest income driven by lower balances and yields on interest-earning deposits in banks, as compared to the three months ended December 31, 2024. The provision for credit losses increased by $0.6 million, reflecting adjustments to expectations for credit losses based on economic trends and forecasts in the three months ended March 31, 2025 compared to the three months ended December 31, 2024. Non-interest income decreased by $0.3 million, primarily due to a reduction in income received on equity investments in venture-backed funds during the three months ended March 31, 2025, as compared to the three months ended December 31, 2024. Non-interest expense increased by $0.6 million, primarily related to an increase in salaries and employee benefits, partially offset by decreases in advertising, promotional, and other operating expenses during the three months ended March 31, 2025, as compared to the three months ended December 31, 2024.

Three months ended March 31, 2025, as compared to three months ended March 31, 2024

The Company’s net income was $13.1 million for the three months ended March 31, 2025, as compared to $10.6 million for the three months ended March 31, 2024. Net interest income increased by $7.2 million, primarily due to an increase in interest income driven by a higher balance of loans with higher yields, partially offset by an increase in interest expense due to larger average deposit balances, as compared to the three months ended March 31, 2024. The provision for credit losses increased by $1.0 million, relating to loan growth and adjustments to expectations for credit losses based on economic trends and forecasts during the three months ended March 31, 2025, as compared to the three months ended March 31, 2024. Non-interest income decreased by $0.5 million, primarily due to a reduction in income received on equity investments in venture-backed funds during the three months ended March 31, 2025, as compared to the three months ended March 31, 2024. Non-interest expense increased by $2.3 million during the three months ended March 31, 2025, as compared to the three months ended March 31, 2024, with an increase in salaries and employee benefits related to increased headcount as the leading driver.

The following is a summary of the components of the Company’s operating results and performance ratios for the periods indicated:

	Three months ended
(in thousands, except per share data)	March 31, 2025			December 31, 2024			$ Change			% Change
Selected operating data:
Net interest income	$	33,977		$	33,489		$	488		1.46	%
Provision for credit losses		1,900			1,300			600		46.15	%
Non-interest income		1,359			1,666			(307	)	(18.43	)%
Non-interest expense		15,045			14,488			557		3.84	%
Pre-tax income		18,391			19,367			(976	)	(5.04	)%
Provision for income taxes		5,280			6,050			(770	)	(12.73	)%
Net income	$	13,111		$	13,317		$	(206	)	(1.55	)%
Earnings per common share:
Basic	$	0.62		$	0.63		$	(0.01	)	(1.59	)%
Diluted	$	0.62		$	0.63		$	(0.01	)	(1.59	)%
Performance and other financial ratios:
ROAA		1.30	%		1.31	%
ROAE		13.28	%		13.48	%
Net interest margin		3.45	%		3.36	%
Cost of funds		2.56	%		2.65	%
Efficiency ratio		42.58	%		41.21	%

	Three months ended
(in thousands, except per share data)	March 31, 2025			March 31, 2024			$ Change			% Change
Selected operating data:
Net interest income	$	33,977		$	26,744		$	7,233		27.05	%
Provision for credit losses		1,900			900			1,000		111.11	%
Non-interest income		1,359			1,833			(474	)	(25.86	)%
Non-interest expense		15,045			12,716			2,329		18.32	%
Pre-tax income		18,391			14,961			3,430		22.93	%
Provision for income taxes		5,280			4,330			950		21.94	%
Net income	$	13,111		$	10,631		$	2,480		23.33	%
Earnings per common share:
Basic	$	0.62		$	0.62		$	—		—	%
Diluted	$	0.62		$	0.62		$	—		—	%
Performance and other financial ratios:
ROAA		1.30	%		1.22	%
ROAE		13.28	%		14.84	%
Net interest margin		3.45	%		3.14	%
Cost of funds		2.56	%		2.62	%
Efficiency ratio		42.58	%		44.50	%

Balance Sheet Summary

(in thousands)	March 31, 2025		December 31, 2024		$ Change			% Change
Selected financial condition data:
Total assets	$	4,245,057	$	4,053,278	$	191,779		4.73	%
Cash and cash equivalents		452,571		352,343		100,228		28.45	%
Total loans held for investment		3,621,819		3,532,686		89,133		2.52	%
Total investments		99,696		100,914		(1,218	)	(1.21	)%
Total liabilities		3,838,606		3,656,654		181,952		4.98	%
Total deposits		3,736,354		3,557,994		178,360		5.01	%
Subordinated notes, net		73,932		73,895		37		0.05	%
Total shareholders’ equity		406,451		396,624		9,827		2.48	%

Insured and collateralized deposits were approximately $2.5 billion, representing 67.55% of total deposits as of March 31, 2025, as compared to 66.92% as of December 31, 2024. Net uninsured and uncollateralized deposits were approximately $1.2 billion as of March 31, 2025, remaining constant from December 31, 2024.
Non-wholesale deposit accounts constituted 81.53% of total deposits as of March 31, 2025, as compared to 84.26% at December 31, 2024. Deposit relationships of greater than $5 million represented 60.87% of total deposits, as compared to 61.13% as of December 31, 2024, and had an average age of approximately 8.80 years as of March 31, 2025, as compared to 9.28 years as of December 31, 2024.
Cash and cash equivalents as of March 31, 2025 were $452.6 million, representing 12.11% of total deposits at March 31, 2025, as compared to 9.90% as of December 31, 2024.
Total liquidity (consisting of cash and cash equivalents and unused and immediately available borrowing capacity as set forth below) was approximately $2.0 billion as of March 31, 2025, as compared to $1.9 billion at December 31, 2024.

	March 31, 2025
(in thousands)	Line of Credit		Letters of Credit Issued		Borrowings		Available
Federal Home Loan Bank of San Francisco (“FHLB”) advances	$	1,276,072	$	731,500	$	—	$	544,572
Federal Reserve Discount Window		856,366		—		—		856,366
Correspondent bank lines of credit		175,000		—		—		175,000
Cash and cash equivalents		—		—		—		452,571
Total	$	2,307,438	$	731,500	$	—	$	2,028,509

The increase in total assets from December 31, 2024 to March 31, 2025 was primarily due to a $100.2 million increase in cash and cash equivalents and an $89.1 million increase in total loans held for investment. The $100.2 million increase in cash and cash equivalents primarily resulted from net cash inflows related to financing and operating activities of $174.1 million and $15.5 million, respectively, partially offset by net cash outflows related to investing activities of $89.3 million. The $89.1 million increase in total loans held for investment between December 31, 2024 and March 31, 2025 was a result of $259.3 million in loan originations and advances, partially offset by $65.6 million and $104.6 million in loan payoffs and paydowns, respectively. The $89.1 million increase in total loans held for investment included $19.8 million in purchases of loans within the consumer concentration of the loan portfolio.

The increase in total liabilities from December 31, 2024 to March 31, 2025 was primarily due to an increase in interest-bearing deposits of $167.3 million. The increase in interest-bearing deposits was largely due to increases in time and money market deposits of $131.2 million and $52.2 million, respectively.

The increase in total shareholders’ equity from December 31, 2024 to March 31, 2025 was primarily a result of net income recognized of $13.1 million and a $0.7 million increase in accumulated other comprehensive income, partially offset by $4.3 million in cash dividends paid during the period.

Net Interest Income and Net Interest Margin

The following is a summary of the components of net interest income for the periods indicated:

	Three months ended
(in thousands)	March 31, 2025			December 31, 2024			$ Change			% Change
Interest and fee income	$	57,087		$	57,745		$	(658	)	(1.14	)%
Interest expense		23,110			24,256			(1,146	)	(4.72	)%
Net interest income	$	33,977		$	33,489		$	488		1.46	%
Net interest margin		3.45	%		3.36	%

	Three months ended
(in thousands)	March 31, 2025			March 31, 2024			$ Change			% Change
Interest and fee income	$	57,087		$	47,541		$	9,546		20.08	%
Interest expense		23,110			20,797			2,313		11.12	%
Net interest income	$	33,977		$	26,744		$	7,233		27.05	%
Net interest margin		3.45	%		3.14	%

The following table shows the components of net interest income and net interest margin for the quarterly periods indicated:

	Three months ended
	March 31, 2025						December 31, 2024						March 31, 2024
(in thousands)	Average Balance		Interest Income/ Expense		Yield/ Rate		Average Balance		Interest Income/ Expense		Yield/ Rate		Average Balance		Interest Income/ Expense		Yield/ Rate
Assets
Interest-earning deposits in banks	$	328,571	$	3,575	4.41	%	$	363,828	$	4,335	4.74	%	$	233,002	$	3,102	5.35	%
Investment securities		100,474		581	2.34	%		103,930		607	2.33	%		109,177		653	2.41	%
Loans held for investment and sale		3,567,992		52,931	6.02	%		3,498,109		52,803	6.01	%		3,082,290		43,786	5.71	%
Total interest-earning assets		3,997,037		57,087	5.79	%		3,965,867		57,745	5.79	%		3,424,469		47,541	5.58	%
Interest receivable and other assets, net		93,543						91,736						93,983
Total assets	$	4,090,580					$	4,057,603					$	3,518,452

Liabilities and shareholders’ equity
Interest-bearing transaction accounts	$	303,822	$	1,112	1.48	%	$	298,518	$	1,249	1.66	%	$	300,325	$	1,126	1.51	%
Savings accounts		123,599		772	2.53	%		127,298		887	2.77	%		124,561		861	2.78	%
Money market accounts		1,540,879		12,435	3.27	%		1,596,116		13,520	3.37	%		1,410,264		12,155	3.47	%
Time accounts		706,528		7,629	4.38	%		617,596		7,438	4.79	%		429,586		5,369	5.03	%
Subordinated notes and other borrowings		73,908		1,162	6.37	%		73,872		1,162	6.25	%		82,775		1,286	6.25	%
Total interest-bearing liabilities		2,748,736		23,110	3.41	%		2,713,400		24,256	3.56	%		2,347,511		20,797	3.56	%
Demand accounts		910,954						921,881						842,105
Interest payable and other liabilities		30,389						29,234						40,730
Shareholders’ equity		400,501						393,088						288,106
Total liabilities & shareholders’ equity	$	4,090,580					$	4,057,603					$	3,518,452

Net interest spread					2.38	%					2.23	%					2.02	%
Net interest income/margin			$	33,977	3.45	%			$	33,489	3.36	%			$	26,744	3.14	%

Net interest income during the three months ended March 31, 2025 increased $0.5 million, or 1.46%, to $34.0 million compared to $33.5 million during the three months ended December 31, 2024. Net interest margin totaled 3.45% for the three months ended March 31, 2025, an increase of nine basis points compared to the prior quarter. The increase in net interest income is primarily attributable to a $1.1 million decrease in interest expense, driven by a 15 basis point decrease in the average rate on interest-bearing deposits compared to the prior quarter. The decrease in interest expense was partially offset by a $0.7 million decrease in interest income, primarily due to a $35.3 million, or 9.69%, decrease in the average balance of interest-earning deposits in banks, combined with a 33 basis point decrease in the average yield on interest-earning deposits in banks.

As compared to the three months ended March 31, 2024, net interest income increased $7.2 million, or 27.05%, to $34.0 million from $26.7 million. Net interest margin totaled 3.45% for the three months ended March 31, 2025, an increase of 31 basis points compared to the same quarter of the prior year. The increase in net interest income is primarily attributable to an additional $9.1 million in loan interest income due to a $485.7 million, or 15.76%, increase in the average balance of loans and a 31 basis point improvement in the average yield on loans during the three months ended March 31, 2025 compared to the same quarter of the prior year. The increase in interest income was partially offset by a $2.4 million increase in deposit interest expense compared to the same quarter of the prior year. The increase in deposit interest expense is primarily attributable to a $478.9 million, or 15.42%, increase in the average balance of deposits and a five basis point increase in the average cost of deposits during the three months ended March 31, 2025 compared to the same quarter of the prior year.

Loans by Type

The following table provides loan balances, excluding deferred loan fees, by type as of March 31, 2025:

(in thousands)
Real estate:
Commercial	$	2,941,201
Commercial land and development		3,556
Commercial construction		113,002
Residential construction		5,747
Residential		34,053
Farmland		43,643
Commercial:
Secured		170,525
Unsecured		34,970
Consumer and other		277,093
Net deferred loan fees		(1,971	)
Total loans held for investment	$	3,621,819

Interest-bearing Deposits

The following table provides interest-bearing deposit balances by type as of March 31, 2025:

(in thousands)
Interest-bearing transaction accounts	$	295,633
Money market accounts		1,577,473
Savings accounts		128,210
Time accounts		801,386
Total interest-bearing deposits	$	2,802,702

Asset Quality

Allowance for Credit Losses

At March 31, 2025, the Company’s allowance for credit losses was $39.2 million, as compared to $37.8 million at December 31, 2024. The $1.4 million increase in the allowance is due to a $2.2 million provision for credit losses recorded during the three months ended March 31, 2025, partially offset by net charge-offs mainly attributable to commercial and industrial loans of $0.7 million, during the same period.

The Company’s ratio of nonperforming loans to loans held for investment remained at 0.05% from December 31, 2024 to March 31, 2025. Loans designated as watch decreased from $123.4 million to $112.0 million between December 31, 2024 and March 31, 2025. Loans designated as substandard increased from $2.6 million to $3.7 million between December 31, 2024 and March 31, 2025. There were no loans with doubtful risk grades at March 31, 2025 or December 31, 2024.

A summary of the allowance for credit losses by loan class is as follows:

	March 31, 2025				December 31, 2024
(in thousands)	Amount		% of Total		Amount		% of Total
Real estate:
Commercial	$	27,027	68.91	%	$	25,864	68.44	%
Commercial land and development		70	0.18	%		78	0.21	%
Commercial construction		2,227	5.68	%		2,268	6.00	%
Residential construction		78	0.20	%		64	0.17	%
Residential		279	0.71	%		270	0.71	%
Farmland		598	1.52	%		607	1.61	%
		30,279	77.20	%		29,151	77.14	%
Commercial:
Secured		5,905	15.05	%		5,866	15.52	%
Unsecured		403	1.03	%		278	0.74	%
		6,308	16.08	%		6,144	16.26	%
Consumer and other		2,637	6.72	%		2,496	6.60	%
Total allowance for credit losses	$	39,224	100.00	%	$	37,791	100.00	%

The ratio of allowance for credit losses to loans held for investment was 1.08% at March 31, 2025, as compared to 1.07% at December 31, 2024.

Non-interest Income

The following table presents the key components of non-interest income for the periods indicated:

	Three months ended
(in thousands)	March 31, 2025		December 31, 2024		$ Change			% Change
Service charges on deposit accounts	$	215	$	179	$	36		20.11	%
Gain on sale of loans		125		150		(25	)	(16.67	)%
Loan-related fees		448		400		48		12.00	%
FHLB stock dividends		331		332		(1	)	(0.30	)%
Earnings on bank-owned life insurance		161		182		(21	)	(11.54	)%
Other income		79		423		(344	)	(81.32	)%
Total non-interest income	$	1,359	$	1,666	$	(307	)	(18.43	)%

Service charges on deposit accounts. The increase resulted primarily from individually immaterial increases in fees earned for services and products to support deposit accounts including, but not limited to, service charges, check order fees, and debit card income.

Gain on sale of loans. The decrease resulted from a decline in the volume and effective yield of loans sold. During the three months ended March 31, 2025, approximately $1.7 million of loans were sold with an effective yield of 7.24%, as compared to approximately $2.0 million of loans sold with an effective yield of 7.60% during the three months ended December 31, 2024.

Other income. The decrease resulted primarily from $0.3 million of income received on equity investments in venture-backed funds during the three months ended December 31, 2024 which did not reoccur during the three months ended March 31, 2025.

The following table presents the key components of non-interest income for the periods indicated:

	Three months ended
(in thousands)	March 31, 2025		March 31, 2024		$ Change			% Change
Service charges on deposit accounts	$	215	$	188	$	27		14.36	%
Gain on sale of loans		125		369		(244	)	(66.12	)%
Loan-related fees		448		429		19		4.43	%
FHLB stock dividends		331		332		(1	)	(0.30	)%
Earnings on bank-owned life insurance		161		142		19		13.38	%
Other income		79		373		(294	)	(78.82	)%
Total non-interest income	$	1,359	$	1,833	$	(474	)	(25.86	)%

Gain on sale of loans. The decrease related primarily to an overall decline in the volume of loans sold, partially offset by an improvement in the effective yield of loans sold. During the three months ended March 31, 2025, approximately $1.7 million of loans were sold with an effective yield of 7.24%, as compared to approximately $5.2 million of loans sold with an effective yield of 7.08% during the three months ended March 31, 2024.

Other income. The decrease related primarily to $0.3 million of income received on equity investments in venture-backed funds during the three months ended March 31, 2024, which did not reoccur during the three months ended March 31, 2025.

Non-interest Expense

The following table presents the key components of non-interest expense for the periods indicated:

	Three months ended
(in thousands)	March 31, 2025		December 31, 2024		$ Change			% Change
Salaries and employee benefits	$	9,134	$	8,360	$	774		9.26	%
Occupancy and equipment		637		649		(12	)	(1.85	)%
Data processing and software		1,457		1,369		88		6.43	%
Federal Deposit Insurance Corporation (“FDIC”) insurance		455		440		15		3.41	%
Professional services		913		774		139		17.96	%
Advertising and promotional		522		752		(230	)	(30.59	)%
Loan-related expenses		319		321		(2	)	(0.62	)%
Other operating expenses		1,608		1,823		(215	)	(11.79	)%
Total non-interest expense	$	15,045	$	14,488	$	557		3.84	%

Salaries and employee benefits. The increase related primarily to: (i) a $0.9 million increase in salaries, benefits, and bonus expense; and (ii) a $0.3 million decrease in loan origination costs due to fewer loan originations, net of purchased consumer loans. The increase was partially offset by a $0.5 million decrease in commissions expense due to fewer loan originations, net of purchased consumer loans, period-over-period.

Professional services. The increase was primarily due to $0.1 million in fees paid for compensation consulting services, which did not occur in the three months ended December 31, 2024.

Advertising and promotional. The decrease related primarily to a $0.1 million decrease in expenses related to sponsored events and partnerships and $0.1 million decrease related to business development expenses.

Other operating expenses. The decrease was primarily due to a $0.1 million decrease in director expenses, such as conferences and meetings, combined with individually immaterial decreases in expenses related to operations, including administrative and operational expenses.

The following table presents the key components of non-interest expense for the periods indicated:

	Three months ended
(in thousands)	March 31, 2025		March 31, 2024		$ Change		% Change
Salaries and employee benefits	$	9,134	$	7,577	$	1,557	20.55	%
Occupancy and equipment		637		626		11	1.76	%
Data processing and software		1,457		1,157		300	25.93	%
FDIC insurance		455		400		55	13.75	%
Professional services		913		707		206	29.14	%
Advertising and promotional		522		460		62	13.48	%
Loan-related expenses		319		297		22	7.41	%
Other operating expenses		1,608		1,492		116	7.77	%
Total non-interest expense	$	15,045	$	12,716	$	2,329	18.32	%

Salaries and employee benefits. The increase related primarily to: (i) a $1.6 million increase in salaries, benefits, and bonus expense, mainly related to a 13.19% increase in headcount between March 31, 2024 and March 31, 2025; and (ii) a $0.1 million increase in commissions paid. This increase was partially offset by a $0.2 million increase in loan origination costs due to a greater number of loan originations, net of purchased consumer loans, period-over-period.

Data processing and software. The increase was primarily due to: (i) increased usage of our digital banking platform; (ii) higher transaction volumes related to the increased number of loan and deposit accounts; and (iii) an increased number of licenses required for new users on our loan origination and documentation system.

Professional services. The increase was primarily due to $0.1 million in fees paid for compensation consulting services and $0.1 million in consulting services relating to operations in San Francisco, neither of which occurred in the three months ended March 31, 2024.

Other operating expenses. The increase was primarily due to individually immaterial increases in expenses related to operations, including administrative and operational expenses such as travel, subscriptions, and professional association memberships.

Provision for Income Taxes

Three months ended March 31, 2025, as compared to three months ended December 31, 2024

Provision for income taxes decreased to $5.3 million for the three months ended March 31, 2025 from $6.1 million for the three months ended December 31, 2024, which was primarily due to: (i) a slight decline in taxable income recognized during the three months ended March 31, 2025; and (ii) a $0.6 million provision to return true-up recorded during the three months ended December 31, 2024 related primarily to the timing of recognition of low income housing tax credits, which did not reoccur during the three months ended March 31, 2025. The effective tax rates were 28.71% and 31.24% for the three months ended March 31, 2025 and December 31, 2024, respectively.

Three months ended March 31, 2025, as compared to three months ended March 31, 2024

Provision for income taxes increased by $1.0 million, or 21.94%, for the three months ended March 31, 2025 compared to the three months ended March 31, 2024. This increase was primarily driven by an increase in taxable income. The effective tax rates were 28.71% and 28.94% for the three months ended March 31, 2025 and March 31, 2024, respectively.

Webcast Details

Five Star Bancorp will host a live webcast for analysts and investors on Tuesday, April 29, 2025 at 1:00 PM ET (10:00 AM PT) to discuss its first quarter financial results. To view the live webcast, visit the “News & Events” section of the Company’s website under “Events” at https://investors.fivestarbank.com/news-events/events. The webcast will be archived on the Company’s website for a period of 90 days.

About Five Star Bancorp

Five Star is a bank holding company headquartered in Rancho Cordova, California. Five Star operates through its wholly owned banking subsidiary, Five Star Bank. The Bank has eight branches in Northern California.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements represent plans, estimates, objectives, goals, guidelines, expectations, intentions, projections, and statements of the Company’s beliefs concerning future events, business plans, objectives, expected operating results, and the assumptions upon which those statements are based. Forward-looking statements include without limitation, any statement that may predict, forecast, indicate, or imply future results, performance, or achievements, and are typically identified with words such as “may,” “could,” “should,” “will,” “would,” “believe,” “anticipate,” “estimate,” “expect,” “aim,” “intend,” “plan,” or words or phases of similar meaning. The Company cautions that the forward-looking statements are based largely on the Company’s expectations and are subject to a number of known and unknown risks and uncertainties that are subject to change based on factors which are, in many instances, beyond the Company’s control. Such forward-looking statements are based on various assumptions (some of which may be beyond the Company’s control) and are subject to risks and uncertainties, which change over time, and other factors, which could cause actual results to differ materially from those currently anticipated. New risks and uncertainties may emerge from time to time, and it is not possible for the Company to predict their occurrence or how they will affect the Company. If one or more of the factors affecting the Company’s forward-looking information and statements proves incorrect, then the Company’s actual results, performance, or achievements could differ materially from those expressed in, or implied by, forward-looking information and statements contained in this press release. Therefore, the Company cautions you not to place undue reliance on the Company’s forward-looking information and statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements are set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 under the section entitled “Risk Factors,” and other documents filed by the Company with the Securities and Exchange Commission from time to time.

The Company disclaims any duty to revise or update the forward-looking statements, whether written or oral, to reflect actual results or changes in the factors affecting the forward-looking statements, except as specifically required by law.

Condensed Financial Data (Unaudited)

	Three months ended
(in thousands, except per share and share data)	March 31, 2025			December 31, 2024			March 31, 2024
Revenue and Expense Data
Interest and fee income	$	57,087		$	57,745		$	47,541
Interest expense		23,110			24,256			20,797
Net interest income		33,977			33,489			26,744
Provision for credit losses		1,900			1,300			900
Net interest income after provision		32,077			32,189			25,844
Non-interest income:
Service charges on deposit accounts		215			179			188
Gain on sale of loans		125			150			369
Loan-related fees		448			400			429
FHLB stock dividends		331			332			332
Earnings on bank-owned life insurance		161			182			142
Other income		79			423			373
Total non-interest income		1,359			1,666			1,833
Non-interest expense:
Salaries and employee benefits		9,134			8,360			7,577
Occupancy and equipment		637			649			626
Data processing and software		1,457			1,369			1,157
FDIC insurance		455			440			400
Professional services		913			774			707
Advertising and promotional		522			752			460
Loan-related expenses		319			321			297
Other operating expenses		1,608			1,823			1,492
Total non-interest expense		15,045			14,488			12,716
Income before provision for income taxes		18,391			19,367			14,961
Provision for income taxes		5,280			6,050			4,330
Net income	$	13,111		$	13,317		$	10,631

Comprehensive Income
Net income	$	13,111		$	13,317		$	10,631
Net unrealized holding gain (loss) on securities available-for-sale during the period		1,030			(3,747	)		(955	)
Less: Income tax expense (benefit) related to other comprehensive income (loss)		305			(1,108	)		(282	)
Other comprehensive income (loss)		725			(2,639	)		(673	)
Total comprehensive income	$	13,836		$	10,678		$	9,958

Share and Per Share Data
Earnings per common share:
Basic	$	0.62		$	0.63		$	0.62
Diluted		0.62			0.63			0.62
Book value per share		19.06			18.60			16.86
Tangible book value per share⁽¹⁾		19.06			18.60			16.86
Weighted average basic common shares outstanding		21,209,881			21,182,143			17,190,867
Weighted average diluted common shares outstanding		21,253,588			21,235,318			17,272,994
Shares outstanding at end of period		21,329,235			21,319,083			17,353,251

Selected Financial Ratios
ROAA		1.30	%		1.31	%		1.22	%
ROAE		13.28	%		13.48	%		14.84	%
Net interest margin		3.45	%		3.36	%		3.14	%
Loan to deposit⁽²⁾		97.01	%		99.38	%		105.37	%

_{⁽¹⁾ See the section entitled “Non-GAAP Reconciliation (Unaudited)” for a reconciliation of this non-GAAP financial measure.
⁽²⁾ Loan balance in loan to deposit ratio is total loans held for investment and sale at period end. Deposit balance in loan to deposit ratio is total deposits at period end.}

(in thousands)	March 31, 2025			December 31, 2024			March 31, 2024
Balance Sheet Data
Cash and due from financial institutions	$	42,473		$	33,882		$	29,750
Interest-bearing deposits in banks		410,098			318,461			155,575
Time deposits in banks		4,024			4,121			5,878
Securities – available-for-sale, at fair value		97,111			98,194			105,006
Securities – held-to-maturity, at amortized cost		2,585			2,720			3,000
Loans held for sale		2,669			3,247			10,243
Loans held for investment		3,621,819			3,532,686			3,104,130
Allowance for credit losses		(39,224	)		(37,791	)		(34,653	)
Loans held for investment, net of allowance for credit losses		3,582,595			3,494,895			3,069,477
FHLB stock		15,000			15,000			15,000
Operating leases, right-of-use asset		5,944			6,245			6,932
Premises and equipment, net		1,524			1,584			1,569
Bank-owned life insurance		23,246			19,375			18,872
Interest receivable and other assets		57,788			55,554			55,058
Total assets	$	4,245,057		$	4,053,278		$	3,476,360

Non-interest-bearing deposits	$	933,652		$	922,629		$	817,388
Interest-bearing deposits		2,802,702			2,635,365			2,138,384
Total deposits		3,736,354			3,557,994			2,955,772
Subordinated notes, net		73,932			73,895			73,786
Other borrowings		—			—			120,000
Operating lease liability		6,591			6,857			7,320
Interest payable and other liabilities		21,729			17,908			26,902
Total liabilities		3,838,606			3,656,654			3,183,780

Common stock		302,788			302,531			220,804
Retained earnings		115,309			106,464			84,216
Accumulated other comprehensive loss, net of taxes		(11,646	)		(12,371	)		(12,440	)
Total shareholders’ equity		406,451			396,624			292,580
Total liabilities and shareholders’ equity	$	4,245,057		$	4,053,278		$	3,476,360

Quarterly Average Balance Data
Average loans held for investment and sale	$	3,567,992		$	3,498,109		$	3,082,290
Average interest-earning assets		3,997,037			3,965,867			3,424,469
Average total assets		4,090,580			4,057,603			3,518,452
Average deposits		3,585,782			3,561,409			3,106,841
Average total equity		400,501			393,088			288,106

Credit Quality
Allowance for credit losses to nonperforming loans		2,222.32	%		2,101.78	%		1,806.73	%
Nonperforming loans to loans held for investment		0.05	%		0.05	%		0.06	%
Nonperforming assets to total assets		0.04	%		0.05	%		0.06	%
Nonperforming loans plus performing loan modifications to loans held for investment		0.05	%		0.05	%		0.06	%

Capital Ratios
Total shareholders’ equity to total assets		9.57	%		9.79	%		8.42	%
Tangible shareholders’ equity to tangible assets⁽¹⁾		9.57	%		9.79	%		8.42	%
Total capital (to risk-weighted assets)		13.97	%		13.99	%		12.34	%
Tier 1 capital (to risk-weighted assets)		11.00	%		11.02	%		9.13	%
Common equity Tier 1 capital (to risk-weighted assets)		11.00	%		11.02	%		9.13	%
Tier 1 leverage ratio		10.17	%		10.05	%		8.63	%

_{⁽¹⁾ See the section entitled “Non-GAAP Reconciliation (Unaudited)” for a reconciliation of this non-GAAP financial measure.}

Non-GAAP Reconciliation (Unaudited)

The Company uses financial information in its analysis of the Company’s performance that is not in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The Company believes that these non-GAAP financial measures provide useful information to management and investors that is supplementary to the Company’s financial condition, results of operations, and cash flows computed in accordance with GAAP. However, the Company acknowledges that its non-GAAP financial measures have a number of limitations. As such, investors should not view these disclosures as a substitute for results determined in accordance with GAAP. Additionally, these non-GAAP measures are not necessarily comparable to non-GAAP financial measures that other banking companies use. Other banking companies may use names similar to those the Company uses for the non-GAAP financial measures the Company discloses, but may calculate them differently. Investors should understand how the Company and other companies each calculate their non-GAAP financial measures when making comparisons.

Tangible shareholders’ equity to tangible assets is defined as total equity less goodwill and other intangible assets, divided by total assets less goodwill and other intangible assets. The most directly comparable GAAP financial measure is total shareholders’ equity to total assets. Management believes that tangible shareholders’ equity to tangible assets is a useful financial measure because it enables management, investors, and others to assess the Company’s financial health based on tangible capital. We had no goodwill or other intangible assets at the end of any period indicated. As a result, tangible shareholders’ equity to tangible assets is the same as total shareholders’ equity to total assets at the end of each of the periods indicated.

Tangible book value per share is defined as total shareholders’ equity less goodwill and other intangible assets, divided by the outstanding number of common shares at the end of the period. The most directly comparable GAAP financial measure is book value per share. Management believes that tangible book value per share is a useful financial measure because it enables management, investors, and others to assess the Company’s value and use of equity. We had no goodwill or other intangible assets at the end of any period indicated. As a result, tangible book value per share is the same as book value per share at the end of each of the periods indicated.

Pre-tax, pre-provision income is defined as pre-tax income plus provision for credit losses. The most directly comparable GAAP financial measure is pre-tax income. Management believes that pre-tax, pre-provision income is a useful financial measure because it enables management, investors, and others to assess the Company’s ability to generate operating profit and capital.

The following reconciliation table provides a more detailed analysis of this non-GAAP financial measure:

	Three months ended
(in thousands)	March 31, 2025		December 31, 2024		March 31, 2024
Pre-tax, pre-provision income
Pre-tax income	$	18,391	$	19,367	$	14,961
Add: provision for credit losses		1,900		1,300		900
Pre-tax, pre-provision income	$	20,291	$	20,667	$	15,861

Investor Contact:
Heather C. Luck, Chief Financial Officer
Five Star Bancorp
(916) 626-5008
hluck@fivestarbank.com

Media Contact:
Shelley R. Wetton, Chief Marketing Officer
Five Star Bancorp
(916) 284-7827
swetton@fivestarbank.com

The MIL Network –

April 29, 2025

MIL-OSI: Skyline Bankshares, Inc. Announces First Quarter 2025 Results

Source: GlobeNewswire (MIL-OSI)

FLOYD, Va. and INDEPENDENCE, Va., April 28, 2025 (GLOBE NEWSWIRE) — Skyline Bankshares, Inc. (the “Company”) (OTC QX: SLBK) – the holding company for Skyline National Bank (the “Bank”) – announced its results of operations for the first quarter of 2025.

As previously announced, the Company acquired Johnson County Bank (“JCB”) on September 1, 2024, with the Company as the surviving corporation. For accounting purposes, the Company is considered the acquiror and JCB is considered the acquiree in the transaction. As such, all information contained herein as of and for periods prior to September 1, 2024 reflects the operations of the Company prior to the merger.

The Company recorded net income of $3.6 million, or $0.64 per share, for the quarter ended March 31, 2025, compared to net income of $2.1 million, or $0.37 per share, for the same period in 2024. First quarter 2025 earnings represented an annualized return on average assets (“ROAA”) of 1.17% and an annualized return on average equity (“ROAE”) of 15.85%, compared to 0.79% and 9.94%, respectively, for the same period last year. Net interest margin (“NIM”) was 4.15% for the first quarter of 2025, compared to 3.64% for the first quarter of 2024.

President and CEO Blake Edwards stated, “We are very pleased with our results for the first quarter of 2025. Our entire Skyline team has worked tirelessly in recent years to deliver on our long-term strategy of growing the Skyline franchise and creating shareholder value through branching activity, organic growth in our legacy markets, and through acquisitions such as last year’s partnership with Johnson County Bank. Our strong first quarter earnings, as noted above, reflect the success of these ongoing efforts. I’m extremely proud of this team and know they will continue to deliver on our brand promise of being “Always our Best” for years to come.”

Highlights

In connection with the acquisition of JCB, effective September 1, 2024, the Company acquired $154.1 million in assets at fair value, including $87.2 million in loans. The Company also assumed $133.8 million of liabilities at fair value, including $125.3 million of total deposits with a core deposit intangible asset recorded of $3.4 million, and goodwill of $4.6 million.
Net income was $3.6 million, or $0.64 per share, for the first quarter of 2025, compared to $2.1 million, or $0.37 per share, for the first quarter of 2024.
Net interest margin (“NIM”) was 4.15% for the first quarter of 2025, compared to 4.10% in the fourth quarter of 2024, and 3.64% in the first quarter of 2024.
Total assets increased in the first quarter of 2025 by $33.9 million, or 2.78%, and increased by $201.4 million, or 19.18%, when compared to $1.05 billion at March 31, 2024.
Net loans were $992.2 million at March 31, 2025, an increase of $15.8 million, or 1.61%, when compared to $976.4 million at December 31, 2024, and increased $172.3 million when compared to $819.9 million at March 31, 2024.
Total deposits were $1.11 billion at March 31, 2025, an increase of $22.2 million, or 2.03%, from $1.09 billion at December 31, 2024, and an increase of $183.9 million from $930.4 million at March 31, 2024.

First Quarter 2025 Income Statement Review

Net interest income after provision for credit losses in the first quarter of 2025 was $11.5 million, compared to $8.8 million in the first quarter of 2024, reflecting an increase in the provision for credit losses of $85 thousand in the quarterly comparison. Total interest income was $15.5 million in the first quarter of 2025, representing an increase of $3.5 million in comparison to the $12.0 million in the first quarter of 2024. Interest income on loans increased in the quarterly comparison by $3.6 million, primarily due to organic loan growth, and the addition of loan balances from the JCB acquisition. Management anticipates that this loan growth will continue to have a positive impact on both earning assets and loan yields.   Interest expense on deposits increased by $653 thousand in the quarterly comparison, as a result of rate increases on deposit offerings, and the additional interest-bearing deposits from the JCB acquisition. Management anticipates that interest expense on deposits could increase in the near term as competitive pressures for deposits may result in continued increases in rates on deposit offerings, especially on time deposits. Interest on borrowings decreased by $11 thousand.

First quarter 2025 noninterest income was $1.8 million compared with $1.7 million in the first quarter of 2024. Included in noninterest income for the first quarter of 2025 was $60 thousand from life insurance contracts.   Included in noninterest income for the first quarter of 2024 was $218 thousand from life insurance contracts and a net realized security loss of $141 thousand. The net security loss resulted from the recognition of unamortized premiums on a called bond.   Excluding these items, noninterest income increased by $104 thousand in the quarter over quarter comparison, primarily as a result of an increase in service charges of $100 thousand.

Noninterest expense in the first quarter of 2025 was $8.9 million compared with $8.0 million in the first quarter of 2024, an increase of $887 thousand, or 11.12%. Salary and benefits increased by $179 thousand in the quarterly comparison due to personnel additions and routine salary adjustments, as well as increased benefit costs. Occupancy and equipment expenses increased by $68 thousand, and data processing increased by $199 thousand in the quarterly comparisons primarily due the JCB acquisition. FDIC assessments increased by $102 thousand due to increased deposit levels from the JCB acquisition and organic deposit growth. Core deposit intangible amortization increased by $132 thousand in the quarterly comparison as a result of the JCB acquisition.

Income tax expense increased by $449 thousand in the quarter-to-quarter comparison, primarily due to an increase in net income before taxes of $2.0 million in the quarterly comparison.

Balance Sheet Review

Total assets increased in the first quarter of 2025 by $33.9 million, or 2.78%, to $1.25 billion at March 31, 2025, from $1.22 billion at December 31, 2024, and increased by $201.4 million, or 19.18%, from $1.05 billion at March 31, 2024. The increase in total assets during the quarter can be primarily attributed to the loan growth of $15.9 million and deposit growth of $22.2 million during the quarter.

Total loans increased during the first quarter by $15.9 million, or 1.61%, to $1.0 billion at March 31, 2025 from $984.5 million at December 31, 2024, and increased by $173.6 million, or 21.01%, compared to $826.7 million at March 31, 2024. Core loan growth during the first quarter was at an annualized rate of 6.60%.

Asset quality has remained strong, with a ratio of nonperforming loans to total loans of 0.22% at March 31, 2025 compared to 0.26% at December 31, 2024. The allowance for credit losses remained comparable at approximately 0.82% of total loans as of March 31, 2025 and December 31, 2024, respectively.

Investment securities increased by $196 thousand during the first quarter to $118.5 million at March 31, 2025 from $118.3 million at December 31, 2024, and decreased by $3.9 million from $122.4 million at March 31, 2024. The increase in the first quarter of 2025 was the result of a $2.6 million decrease in unrealized losses on investment securities and paydowns $2.4 million.

Total deposits increased in the first quarter of 2025 by $22.2 million, or 2.03%, to $1.11 billion at March 31, 2025 from $1.09 billion at December 31, 2024, and increased $183.9 million, or 19.77%, compared to $930.4 million at March 31, 2024. Noninterest-bearing deposits increased by $12.5 million and interest-bearing deposits increased by $9.7 million during the quarter. Lower cost interest-bearing deposits increased by $8.3 million during the quarter, and time deposits increased by $1.4 million.

Stockholders’ equity increased by $4.2 million, or 4.80%, to $92.9 million at March 31, 2025, from $88.7 million at December 31, 2024, and increased $10.0 million, or 12.12%, from $82.9 million at March 31, 2024. The change during the quarter was due to earnings of $3.6 million, less dividends paid of $1.4 million, and $2.0 million in other comprehensive income. Book value increased from $15.69 per share at December 31, 2024 to $16.44 per share at March 31, 2025.

Forward-looking statements

This release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Act of 1934 as amended. These include statements as to expectations regarding future financial performance and any other statements regarding future results or expectations. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and are including this statement for purposes of these safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe future plans, strategies, and expectations of the Company, are generally identified by the use of words such as “believe,” “expect,” “intend,” “anticipate,” “estimate,” or “project” or similar expressions. Our ability to predict results, or the actual effect of future plans or strategies, is inherently uncertain. Factors which could have a material adverse effect on the operations and future prospects of the Company and its subsidiaries include, but are not limited to: changes in interest rates; general economic and financial market conditions; the effect of changes in banking, tax and other laws and regulations and interpretations or guidance thereunder; monetary and fiscal policies of the U.S. government, including policies of the U.S. Treasury and the Federal Reserve Board; the economic impact of duties, tariffs or other barriers or restrictions on trade, and any retaliatory counter measures, and the volatility and uncertainty arising therefrom; the quality and composition of the loan and securities portfolios; demand for loan products; deposit flows; competition; demand for financial services in the Company’s market area; the implementation of new technologies; the ability to develop and maintain secure and reliable electronic systems; accounting principles, policies, and guidelines; disruptions to customer and employee relationships and business operations caused by the Johnson County Bank acquisition; the ability to achieve the cost savings and synergies contemplated by the acquisition within the expected timeframe, or at all; and other factors identified in Item 1A, “Risk Factors,” in the Company’s Annual Report on 10-K for the year ended December 31, 2024. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. We undertake no obligation to update or clarify these forward‐looking statements, whether as a result of new information, future events or otherwise.

(See Attached Financial Statements for quarter ending March 31, 2025)

Skyline Bankshares, Inc. Condensed Consolidated Balance Sheets March 31, 2025; December 31, 2024; March 31, 2024

	March 31,			December 31,			March 31,
(dollars in thousands except share amounts)		2025			2024			2024
	(Unaudited)			(Audited)			(Unaudited)
*Assets*
Cash and due from banks	$	21,298		$	17,889		$	13,115
Interest-bearing deposits with banks		16,130			1,562			8,233
Federal funds sold		456			–			384
Investment securities available for sale		118,483			118,287			122,368
Restricted equity securities		4,993			4,034			3,609
Loans		1,000,332			984,459			826,684
Allowance for credit losses		(8,160	)		(8,027	)		(6,765	)
Net loans		992,172			976,432			819,919
Cash value of life insurance		26,649			26,743			23,055
Other real estate owned		140			140			–
Properties and equipment, net		35,342			34,663			31,394
Accrued interest receivable		4,009			4,013			3,450
Core deposit intangible		3,603			3,815			837
Goodwill		7,900			7,900			3,257
Deferred tax assets, net		5,060			5,593			5,252
Other assets		15,263			16,528			15,207
Total assets	$	1,251,498		$	1,217,599		$	1,050,080

*Liabilities*
Deposits
Noninterest-bearing	$	350,451		$	337,918		$	293,912
Interest-bearing		763,936			754,285			636,529
Total deposits		1,114,387			1,092,203			930,441

Borrowings		37,026			29,254			30,000
Accrued interest payable		699			950			683
Other liabilities		6,465			6,524			6,081
Total liabilities		1,158,577			1,128,931			967,205

*Stockholders’ Equity*
Common stock and surplus		33,556			33,507			33,145
Retained earnings		75,874			73,714			69,638
Accumulated other comprehensive loss		(16,509	)		(18,553	)		(19,908	)
Total stockholders’ equity		92,921			88,668			82,875
Total liabilities and stockholders’ equity	$	1,251,498		$	1,217,599		$	1,050,080
Book value per share	$	16.44		$	15.69		$	14.72
Tangible book value per share	$	14.41		$	13.62		$	14.00


*Asset Quality Indicators*
Nonperforming assets to total assets		0.19	%		0.22	%		0.17	%
Nonperforming loans to total loans		0.22	%		0.26	%		0.22	%
Allowance for credit losses to total loans		0.82	%		0.82	%		0.82	%
Allowance for credit losses to nonperforming loans		367.90	%		313.19	%		378.14	%

Skyline Bankshares, Inc.
Condensed Consolidated Statement of Operations

	Three Months Ended
	March 31,
(dollars in thousands except share amounts)	2025		2024
	(Unaudited)		(Unaudited)
*Interest income*
Loans and fees on loans	$	14,721	$	11,147
Interest-bearing deposits in banks		47		64
Federal funds sold		2		4
Interest on securities		682		734
Dividends		32		37
		15,484		11,986
*Interest expense*
Deposits		3,335		2,682
Interest on borrowings		426		437
		3,761		3,119
Net interest income		11,723		8,867

*Provision for credit losses*		178		93
Net interest income after
provision for credit losses		11,545		8,774

*Noninterest income*
Service charges on deposit accounts		584		551
Other service charges and fees		916		849
Net realized losses on securities		–		(141	)
Mortgage origination fees		35		55
Increase in cash value of life insurance		174		146
Life insurance income		60		218
Other income		17		21
		1,786		1,699
*Noninterest expenses*
Salaries and employee benefits		4,500		4,321
Occupancy and equipment		1,479		1,411
Data processing expense		848		649
FDIC Assessments		246		144
Advertising		244		217
Bank franchise tax		132		99
Director fees		93		58
Professional fees		302		221
Telephone expense		124		107
Core deposit intangible amortization		212		80
Other expense		683		669
		8,863		7,976
Net income before income taxes		4,468		2,497


*Income tax expense*		895		446
Net income	$	3,573	$	2,051

*Net income per share*	$	0.64	$	0.37
*Weighted average shares outstanding*		5,584,704		5,564,568
*Dividends declared per share*	$	0.25	$	0.23

Skyline Bankshares, Inc.
Reconciliation of Non-GAAP Financial Measures

In addition to financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), the Company uses certain non-GAAP financial measures that provide useful information for financial and operational decision making, evaluating trends, and understanding the Company’s financial condition, capital position and financial results. Non-GAAP financial measures are supplemental and not a substitute for, or more important than, financial measures prepared in accordance with GAAP and may not be comparable to those reported by other financial institutions. The non-GAAP financial measure presented in this document includes tangible book value per share. The following tables present calculations underlying non-GAAP financial measures.

	March 31,			December 31,			March 31,
(dollars in thousands except share amounts)		2025			2024			2024
	(Unaudited)			(Unaudited)			(Unaudited)
*Tangible Common Equity*
Total stockholders’ equity (GAAP)	$	92,921		$	88,668		$	82,875
Less: Goodwill		(7,900	)		(7,900	)		(3,257	)
Less: Core deposit intangible		(3,603	)		(3,815	)		(837	)
Tangible common equity (non-GAAP)	$	81,418		$	76,953		$	78,781
Common stock shares outstanding		5,651,704			5,651,704			5,629,204
Tangible book value per share	$	14.41		$	13.62		$	14.00

For more information contact:
Blake Edwards, President & CEO – 276-773-2811
Lori Vaught, EVP & CFO – 276-773-2811

The MIL Network –

April 29, 2025

MIL-OSI USA: Nadler, Smith, Himes Introduce West Bank Violence Prevention Act in Response to Ben-Gvir Visit

Source: United States House of Representatives – Congressman Jerrold Nadler (10th District of New York)

WASHINGTON, DC – Today, U.S. Rep. Jerrold Nadler (NY-12), Rep. Adam Smith (WA-09), and Rep. Jim Himes (CT-04), introduced the West Bank Violence Prevention Act in response to Leader of the Jewish Power Party and Israeli Minister of National Security Itamar Ben-Gvir’s visit to the United States.

The West Bank Violence Prevention Act codifies and enshrines into law the Biden Administration’s Executive Order 14115, which sought to prevent acts of violence in the West Bank and to punish those who commit such acts. The legislation, like the Executive Order, applies to those committing acts of violence in the West Bank, regardless of their nationality. During the Biden Administration, determinations under the Executive Order were made regarding both Palestinian and Israeli organizations and individuals.

President Trump repealed EO 14115 on his first day of his term, January 20, 2025. As a result, violent extremist organizations like the Palestinian group Lions’ Den and the Israeli settler group Hilltop Youth are no longer designated under the Specially Designated Nationals and Blocked Persons List (SDN List). With their assets no longer frozen, these groups continue wreaking terror in the West Bank unencumbered.

According to the Washington Institute for Near East Policy, settler violence increased by an estimated 30 percent over the first few months of 2025 compared to the same period in 2024. Such violence has reached a fever pitch, causing the West Bank to become “a tinderbox,” one match away from igniting into catastrophe.

The members joined together to introduce this legislation as Itamar Ben-Gvir completes his visit to the United States. Ben-Gvir has referred to the Hilltop Youth as “sweet kids,” has reportedly also used his authority as Minister of Internal Security to direct Israel’s police to shield perpetrators of settler violence, including giving them “a secret sense of backing” from the Israeli police. The Act serves to send a message: Ben-Gvir’s incitement is not welcome in our communities and in the United States.

“Itamar Ben-Gvir serves as inciter-in-chief of settler violence in the West Bank,” said Rep. Nadler. “In August of 2024, violent settlers chanting ‘we are Ben-Gvir’s gang’ burned down the home of a Palestinian family in the West Bank town of Jit. Ben-Gvir also downplayed concern expressed by Israeli security officials at a cabinet meeting regarding a wave of deadly settler violence in 2023, including the death of a 19-year-old Palestinian in Huwara, calling the attacks simply ‘graffiti.’ The head of Israel’s internal security service wrote to Prime Minister Netanyahu in August of 2024 that Ben-Gvir’s actions are doing ‘indescribable damage,’ and are ‘a massive stain on Judaism and us all.’ Let’s be crystal clear about who Itamar Ben-Gvir is: a racist, terrorist, Jewish supremacist. This past week Ben-Gvir brought his unique brand of hate across the ocean to American campuses, meetings with American Jews, and with at least one Republican Member of Congress. I am proud to be leading my colleagues in meetings Ben-Gvir’s arrival with the West Bank Violence Prevention Act, which will build on the progress made by the Biden Administration, and make clear that the United States Congress will not stand for Ben-Gvir’s incitement, and the settler violence in the West Bank that he champions. This bill would also prevent violence by all perpetrators, settler and Palestinian alike. I hope my colleagues will join us in using the tools at our disposal to enshrine President Biden’s landmark Executive Order on violence in the West Bank into law.”

“Violence in the West Bank threatens peace and stability in the region, and any entity committing this violence, from extremist Israeli settlers to the Palestinian terrorist group Lions’ Den, must be sanctioned,” said Rep. Smith. “Israel’s encouragement of settler organizations in the West Bank has exacerbated tensions in the region, as Prime Minister Netanyahu, Finance Minister Smotrich, and National Security Minister Ben-Gvir have promoted Israeli settler expansion and tacitly enabled settler violence. Further violence from any Israeli or Palestinian hostile actors must be discouraged to prevent further threats to the peace, security, and stability of the West Bank, Gaza, Israel, and the broader Middle East.”

“The ongoing violence in the West Bank, from both Israeli settlers and Palestinian terrorist groups, is devastating for residents in the short-term and detrimental to long-term stability in the territory,” said Rep. Himes. “The Biden Administration’s Executive Order took an important step towards deterring extremism in the region, and the West Bank Violence Prevention Act would codify that language to ensure that instigators of such violence are held accountable for their actions.”

The text of the West Bank Violence Prevention Act can be viewed here.

Rep. Nadler’s remarks at the “Say No to Ben-Gvir” rally in New York City can be watched here and read here.

###

MIL OSI USA News –

April 29, 2025

Maturity	Rate	Bidding Volume	Winning Bid Volume
7 days	1.50%	RMB340.5 billion	RMB340.5 billion

Category: Banking

Components of the broad monetary aggregate M3

Chart 1

Counterparts of the broad monetary aggregate M3

Chart 2

Claims on euro area residents

Chart 3

Notes:

The emerging reality of fragmentation

Fragmentation of the real economy

Financial fragmentation

The looming consequences of fragmentation

Medium-term impacts

Long-term structural changes

The central bank’s role in a fragmented world

Conclusion

Four cyclones

Nation-wide impact:

The damage

1

Stakeholder mapping

Review of existing policies and regulations

Identification of vulnerabilities (Stress Testing)

Principles for resilient infrastructure

Development of an Implementation plan

The roadmap for infrastructure resilience in Madagascar is a key strategic document, as it outlines a comprehensive action plan aimed at minimising disaster risks in the country,” he adds.

Advancing Infrastructure Resilience in Madagascar

Developing the plan

“With this new way of looking by zooming out, we have more of an overall vision of everything that makes infrastructure vulnerable,” Randrianandrasana Lila Norolalaina, Head of Disaster Risk Reduction at the Ministry of Education, says.

Interdependencies of Functions and Cascading Effects

Energy

Stress-testing analysis, Energy

“When we know the state of all our assets, then we will be better able to ensure proper maintenance, keep track of the hotspots, and manage all the gaps.”

Transport

Stress-testing analysis, Transportation

5 airports

9 of 57

16,292 km

“Raising awareness about the importance of norms is an important moment,” Ventsolalaina Ramilison, Head of Disaster Risk Reduction Department at CPGU / Madagascar said. “Now there is just the question of creating and strengthening a monitoring authority.”

Lessons for other countries

“Given that donors tend to pay the costs of reconstruction following a disaster in Madagascar, they also benefit when Madagascar reduces the extent and cost of those disasters,” Ventsolalaina Ramilison, Head of Disaster Risk Reduction Department at CPGU / Madagascar says.

“When we can prevent storms from destroying our water supply infrastructure every year, then we can begin to build more sustainably,” she said. “That gives us hope, because we want to escape these endless cycles of recovery.”

Tonga

85,000 people

1

Stakeholder mapping

Review of existing policies and regulations

Identification of vulnerabilities (Stress Testing)

Principles for resilient infrastructure

Development of an Implementation plan

“The infrastructure resilience review process is already helping us to do that,” he said.

Advancing Infrastructure Resilience in Tonga

The process

Stress-testing of Critical Infrastructure against Identified Hazard, Tonga

“By prioritising resilience, the country can support sustainable economic growth, adapt to climate change, and protect communities, while minimising economic and human losses.”

Water sector

Hazard-related disruptions in Tonga’s water sector

TROPICAL CYCLONES:

VOLCANIC ERUPTIONS AND ASHFALL:

DROUGHTS:

TSUNAMIS:

Transport

“The infrastructure resilience review reminds us that we are not passive actors, but that to a much greater extent we are masters of our own destiny,” said Sione Pulotu ‘Akau’ola, CEO for Ministry of MEIDECC.

“In the long run, building resilience into our infrastructure will save us lives, destruction, and economic damage,” he said.

New appointments to Financial Conduct Authority board announced

About the Financial Conduct Authority

About the appointment process

Share this page

Updates to this page

Inflation

Income and consumption

Economic growth and labour market

Housing and credit access

Notes

Components of the broad monetary aggregate M3

Chart 1

Counterparts of the broad monetary aggregate M3

Chart 2

Claims on euro area residents

Chart 3