Interim Board of Directors' Report H1 2024	4
Key business highlights	6
Consumer Banking - Ferratum	8
SME Banking - CapitalBox	10
Wholesale Banking – Multitude Bank	12
Key figures and ratios	14
Key developments and progress in H1 2024	16
Statement pursuant to Capital Markets Rule 5.75.3 issued by
the Malta Financial Services Authority	23
Unaudited condensed interim consolidated financial statements H1 2024	24
Condensed consolidated statement of profit or loss	24
Condensed consolidated statement of comprehensive income	25
Condensed consolidated statement of financial position	26
Condensed consolidated statement of cash flows	27
Condensed consolidated statement of changes in equity	28
Notes to condensed interim consolidated financial statements	29

Multitude Group H1 2024 – Board of Directors' Report 3

Interim Board of Directors' Report H1 2024

Multitude SE in Brief

In 2023, our business units comprised Ferratum (consumer lending), CapitalBox (SME lending), and SweepBank (banking app). In 2024, Multitude ceased reporting SweepBank as an independent business unit. Instead, its technology and products now serve as a foundational component supporting an expanded range of services at Ferratum (transitioning from Consumer Lending to Consumer Banking) and CapitalBox (expanding from SME Lending to SME Banking) to better meet our customers' needs. This integration enables Ferratum and CapitalBox to provide comprehensive digital banking services, including credit cards, to their customers.

Multitude SE, the Group's ultimate parent company, was established in 2005 and, as of 30 June 2024, was headquartered at Ratamestarinkatu 11 A, FI-00520 Helsinki. Since 1 July 2024, the parent company is headquartered at ST Business Centre 120, The Strand, Gzira, GZR 1027, Malta. As a Group, we employ over 700 people and actively provide services to customers in 16 countries. In 2023, we achieved a combined interest income of EUR 230 million. The Group owns Multitude Bank p.l.c., licensed by the Malta Financial Services Authority (MFSA), which is a significant part of the Group that allows it to provide financial services and products to European Economic Area (EEA) member states. Multitude SE is listed on the Prime Standard segment of the Frankfurt Stock Exchange. Since its relocation to Malta, the ticker symbol is "E4I", previously being "FRU".

OUR CURRENT BUSINESS UNITS

Key business highlights

H1 in Brief

KEY HIGHLIGHTS:

Solid performance of the group continues with strong cash position
Group revenue increased by 17.0% to EUR 128.8m y-o-y
All 3 business units are delivering double digit revenue growth
Group EBIT increased by 34.5% to EUR 28.3m y-o-y
We are on track to achieve our EUR 67.5m EBIT guidance for 2024

Company structure and business model

Multitude Group is an international provider of digital financial services. Nordic-born and focused on the European market, the Group actively provides services to customers in 16 countries. Backed by over 19 years of solid track record in building and scaling financial technology, its ambition is to become the most valuable financial platform for overlooked customers. Overlooked customers include individuals and businesses that traditional financial players may neglect due to unconventional financial profiles or underserved communities with limited access to financial services.

Multitude growth platform

The core of Multitude's strategy lies in its growth platform with services designed to be accessible to anyone, anywhere and anytime. We have built the business on these principles from the first day of operations. This platform enables scalable Banking-as-a-Service (BaaS), emphasising accessibility, scalability, and customer value. By leveraging its expertise in credit risk scoring and digital-first approach, Multitude aims to serve overlooked customers effectively.

As a vital enabler of scalability, our centralised and standardised operations to offer BaaS are built on six elements and generate value for internal business units and external customers through:

Compliance framework
Banking licence
Technology stack
Big data and AI
Product library
Customer management systems and processes

Our platform serves over 400,000 customers through our three internal business units: Consumer Banking (Ferratum brand), SME Banking (CapitalBox brand), and Wholesale Banking (Multitude Bank brand). These customers have or have had an active loan balance with at least one of the business units within Multitude within the past 12 months or are active users of the SweepBank app. The SweepBank app will be used by each of the business units to offer additional digital banking services to its customers.

Business Unit: Consumer Banking - Ferratum

Ferratum offers five products—Micro Loan, Plus Loan, Prime Loan, Credit Limit, and Credit Card designed to address diverse and immediate financial needs. These products are tailored to help individuals manage unplanned, short-term expenses arising from unexpected life events. Applying for any of Ferratum's loans is simple, requiring only minimal data entry from the customer. The rest is managed by Ferratum's in-house developed, AI-powered scoring algorithms. This fully digital, automated process ensures that applications are completed and scored within minutes, with approved loan amounts typically deposited into the customer's bank account in less than 15 minutes.

In H1 2024, Ferratum operated in 13 markets: Bulgaria, Croatia, Czechia, Denmark, Estonia, Finland, Germany, Latvia, the Netherlands, Norway, Romania, Slovenia, and Sweden with two product categories, instalment loans and revolving loans.

Instalment loans

Micro Loan

Micro Loans, so-called bullet loans, are for instant, short-term financing with quick repayment. They range from EUR 25 to EUR 1,000, which customers pay back in one instalment within 7-60 days.

Plus Loan

A Plus Loan caters to a customer's higher need for instant finance. Loan amounts range from EUR 300 to EUR 4,000, the maturity periods are between 2 and 18 months, and the loan is repaid in equal instalments over the loan term.

Prime Loan

Prime Loans are longer-term instalment loans for consumers that enable higher purchases, like home renovations, cars and other more significant purchases. The loans can amount to up to EUR 15,000 with loan maturities ranging between 1 and 7 years.

Revolving loans

Credit Limit

The Credit Limit, the most popular product under Ferratum, is a pre-approved credit line, also called revolving credit, which enables financial flexibility on a more continuous basis. Eligible customers are pre-approved for up to EUR 5,000 and can withdraw money and repay without fixed amounts or timelines.

Credit Card

The Credit Card, a Mastercard® without annual or monthly fees, allows financing purchases of up to EUR 8,000. The card offers free liability coverage for purchases with it and up to 60 days interest-free period. Customers can also use the card as a flexible credit facility by withdrawing money from it directly into their bank account, a feature that is growing in popularity among customers.

H1 2024 highlights

Consumer Banking remains focused on sustaining its momentum through consistently executing its established strategies and robust portfolio.

In the first half of 2024, Ferratum's financial results have shown steady progress. Interest income showed positive 10.9% growth (EUR 10.5 million) from EUR 97.1 million in H1 2023 to EUR 107.6 million in H1 2024. The amount of loans to customers remained stable at the end of H1 2024 compared to end of 2023. The organic growth of portfolio over the year contributed to a 10.6% increase in impairment loss on loans to customers from EUR 39.7 million in H1 2023 to EUR 43.9 million in H1 2024.

In Latvia, the business unit has successfully launched the SweepBank Debit Card and Current Account (CA) for existing customers. Customers with an existing Ferratum Credit Limit (CLP) can now view and manage their CLP through the SweepBank app. They can make near-instantaneous withdrawals from their CLP to their SweepBank CA. These funds can then be conveniently used via the debit card or for paying invoices, enhancing overall convenience and financial management. This development is a prime example of the synergies and added value of integrating SweepBank into all business units as an underlying service provider.

Outlook

Ferratum continues to drive innovation by enhancing user data analysis and refining digital marketing tactics to sustain growth within its markets. The business unit is focused on shifting lending operations towards higher-profit countries and broadening its product portfolio to capitalise on emerging opportunities. The team is working on launching the SweepBank credit card in H2 2024 for its existing customers in Germany.

Additionally, Ferratum is benefiting from its scalable operating model, and will continue to focus on improving operational efficiency whilst maintaining the growth momentum.

Business Unit: SME Banking - CapitalBox

Small and medium-sized enterprises (SMEs) make up an impressive 99.8% of European businesses. Nonetheless, they frequently encounter inadequate support or outright neglect from traditional banking systems. The outdated methods and services offered by traditional banks no longer sync with the dynamic and evolving needs of today's SMEs within the contemporary business landscape.

The SME Banking business unit provides essential financial solutions to SMEs through its credit lines and instalment loans under the CapitalBox brand. Through a streamlined, fully digitalised process, funds can be made available to SMEs in a matter of minutes after the application approval. This speed and efficiency position CapitalBox as the perfect ally for meeting short-term business financing requirements. Powered by advanced technology, experience, and Multitude's growth platform resources, CapitalBox delivers a swift and dependable offering.

In H1 2024, CapitalBox operated in five markets: Finland, Sweden, Denmark, Lithuania, and the Netherlands, offering five distinct products.

Instalment Loans

One of CapitalBox's key offerings is its Instalment Loan, which extends up to EUR 350,000. These loans come with flexible repayment periods spanning 6 to 48 months. They are tailored to assist SMEs in funding operations such as expansion, inventory management, marketing efforts, hiring new personnel, and acquiring or leasing equipment. On average, businesses borrow around EUR 21,300 with a typical loan duration of 22 months.

Invoice Purchasing

CapitalBox acquired the assets of Omniveta in H1 2024. Omniveta's invoice purchasing product is the basis for CapitalBox's Invoice Purchasing offering for SMEs in Denmark. Currently, CapitalBox purchases invoices with a due period ranging from 8 days (with credit insurance guarantee) to 90 days and discount rate ranging from 1.4% to 6.5%. CapitalBox intends to expand this product line to other countries where it operates.

Credit Line

The Credit Line is a dynamic form of financing that grants SMEs access to a credit limit ranging from EUR 2,000 to EUR 150,000. Additionally, CapitalBox collaborates with retail partners to offer financing solutions to their business customers, enabling them to make financed purchases right at the point of sale. The Credit Line is available in all markets in which CapitalBox operates.

Secured Loan

The Secured Loan was launched initially in Finland and Lithuania and is planned to be rolled out in other markets. The Secured Loan is designed to support larger investments to drive growth for SMEs, addressing a gap in the industry where smaller FinTech firms might lack capacity, and traditional banks might choose not to provide secured loans. The loan amount is up to EUR 3 million.

Purchase Finance (BNPL)

CapitalBox introduced a tailored Purchase Financing or Buy Now, Pay Later (BNPL) product explicitly designed for SMEs. This financial solution provides businesses flexible access to up to EUR 20,000 in funding without collateral. The product, currently available in Finland, is strategically designed to help SMEs manage cash flow effectively, allowing them to invest in growth opportunities and finance purchases without relying on their daily capital or experiencing immediate financial strain.

H1 2024 highlights

Multitude's growth strategy is centred around three key pillars: organic growth, strategic partnerships, and mergers and acquisitions (M&A). CapitalBox has made significant progress in each of these areas. Loan sales are growing steadily at an average rate of 9.4% month-overmonth, which is a testament to CapitalBox's ability to meet the evolving needs of SME customers. Furthermore, CapitalBox continues to forge strategic partnerships that enhance service offerings and market reach, integral to their growth strategy and helping to deliver more value to customers. Additionally, CapitalBox successfully completed an acquisition in Denmark (Omniveta), which is already contributing approximately 4% of its revenue. This acquisition strengthens market position and opens new avenues for contributing to growth and expansion.

CapitalBox leverages cutting-edge technology from SweepBank to enhance its operational efficiency and customer experience. The technology integration allows the business unit to offer innovative financial solutions tailored to the unique needs of SMEs.

In the first half of 2024, CapitalBox's loan portfolio expanded by 25.1%, growing from EUR 104.0 million at the end of 2023 to EUR 130.2 million at the end of H1 2024. Interest income increased by 43.7% (EUR 4.8 million), from EUR 11.2 million in H1 2023 to EUR 16.0 million in H1 2024, as a result of investment in the new loan portfolio. Impairment losses on loans to customers increased significantly when comparing H1 2023 (EUR 2.5 million) to H1 2024 (EUR 7.9 million) due to the unfavourable economic performance of customers in the construction, transportation, and car sales sectors. The business unit took actions to limit the risk through more rigid underwriting, resulting in improved credit loss dynamics by the end of H1 2024.

Outlook

Looking ahead, CapitalBox is preparing to launch a comprehensive daily banking offering for SMEs across all its markets. Starting in Sweden, it will introduce current accounts, payment services, and business cards, with plans to expand these offerings throughout the next year. This strategic initiative will significantly enhance the business unit's value proposition and solidify its position as a leading financial partner for SMEs.

Business Unit: Wholesale Banking – Multitude Bank

Multitude's latest business unit, Wholesale Banking, launched under the Multitude Bank brand, was officially introduced as a distinct entity in January 2024. This business unit focuses on two key offerings: Secured Debt and Payment Solutions.

Wholesale Banking represents the newest addition to the Multitude growth platform, strategically positioned to serve a new customer segment. This segment includes payment and electronic money institutions seeking comprehensive solutions for transaction processing and payment handling.

With nearly two decades of robust experience, a digital-first approach, advanced risk management tools, and strategic data utilisation, Multitude enables an exceptionally swift underwriting process, often completed in just six weeks.

Target customers

Wholesale Banking customers encompass diverse entities, including traditional banks seeking specialised financial services, payment institutions requiring tailored solutions for transaction processing, and electronic money institutions seeking efficient mechanisms for handling payments and currencies. These customers may vary in size, scope, and specific needs, however, they share a common interest in accessing comprehensive financial solutions to support their operations and serve their own clientele effectively.

Secured Debt

Secured Debt, utilising scalable deposit funding, the Group's collection expertise, and the power of data and artificial intelligence, is an ideal means to finance loan portfolios and other assets efficiently. Wholesale Banking provides secured funding against lending portfolios or other assets pledged as collateral, while loan-to-value ratios protect against credit losses. This collateral mitigates credit losses and is subject to in-depth monitoring throughout the funding lifecycle. With nearly 20 years in the business, Multitude understand the dynamics and the risks in the lending industry.

Payment Solutions

Wholesale Banking offers the essential components for seamless end-to-end payment operations to banks, payment institutions, and electronic money institutions. It supports core processes and serves as a reliable business backbone or fallback option, ensuring efficient management of payment rails for receiving and making payments.

H1 2024 highlights

In the first half of 2024, Wholesale Banking's financial results have shown further growth of the portfolio. The debt investments expanded by 66.3%, growing from EUR 62.1 million at the end of 2023 to EUR 103.3 million at the end of H1 2024. As a result, interest income showed positive 182.3% growth (EUR 3.3 million) from EUR 1.8 million in H1 2023 to EUR 5.1 million in H1 2024. On the other hand, the increase in assets led to impairment loss of EUR 0.1 million in H1 2024.

Outlook

The team is currently dedicated to portfolio development and will be actively engaging in marketing and public relations efforts to promote the products and generate high-quality leads.

Key figures and ratios

EUR '000	Q2 2024	H1 2024	Restated Q2 2023	Restated H1 2023
Net interest income	54,562	110,157	50,931	101,254
Profit before income tax	5,405	8,401	6,621	9,653
Net cash flows (used in) / from operating activities	(50,326)	(103,303)	(20,432)	58,143
Net cash flows (used in) investing activities	(3,732)	(7,180)	(3,237)	(5,879)
Net cash flows from / (used in) financing activities	47,925	45,861	(6,485)	(8,413)
Net (decrease) / increase in cash and cash equivalents	(6,043)	(64,622)	(30,155)	43,850

EUR '000	30 June 2024	31 December 2023
Loans to customers	593,701	575,948
Impaired loan coverage ratio, in %	17.2	16.6
Debt investments	103,282	62,114
Deposits from customers	678,311	732,350
Cash and cash equivalents	218,996	283,712
Total assets	986,838	990,878
Non-current liabilities	387,480	299,798
Current liabilities	415,200	507,434
Total liabilities	802,679	807,232
Total equity	184,158	183,647
Equity ratio, in %	18.7	18.5
Net equity ratio, in %	24.0	26.0
Net debt to equity ratio	3.17	2.85

Calculation of key financial ratios
Impaired loan coverage ratio (%) =		Credit loss allowance
	100x	Gross loans to customers
Equity ratio (%) = 100x		Total equity
		Total assets
		Total liabilities – cash and cash equivalents
Net debt to equity ratio =		Total equity
Net equity ratio (%) =	100x	Total equity
		Total assets – cash and cash equivalents

Key developments and progress in H1 2024

Financial overview

Statement of profit or loss:

The Group showed solid financial performance in H1 2024, demonstrating continuous improvement compared to H1 2023. Key financial metrics, such as net interest income and EBIT displayed positive trends, showing persistent organic growth and effective long-term planning. Interest income increased by 17.0% (EUR 18.7 million) from EUR 110.1 million in H1 2023 to EUR 128.8 million in H1 2024, driven by a 12.7% growth (EUR 13.7 million) in interest income on loans to customers and a substantial increase (EUR 3.2 million) in interest income on debt investments from EUR 1.7 million in H1 2023 to EUR 4.9 million in H1 2024. The main difference to comparative period is result of significant investment into Wholesale Banking business unit portfolio. In general, the interest income growth followed the increase in portfolio base.

On the other hand, due to growth in the loan portfolio, the impairment loss on loans to customers increased by 23.4% (EUR 9.9 million, from EUR 42.2 million in H1 2023 to EUR 52.1 million in H1 2024). Interest expense grew by 111.4% (EUR 9.9 million) from EUR 8.8 million EUR in H1 2023 to EUR 18.7 million in H1 2024 as result of overall interest rate growth on the market.

Personnel expenses increased by 12.4% (EUR 2.1 million) from EUR 16.8 million in H1 2023 to EUR 18.9 million in H1 2024 mainly driven by a 13.7% growth (1.9 million) in wages and salaries (from EUR 13.6 million in H1 2023 to EUR 15.5 million in H1 2024). The main driver for the increase is growing employee count.

During the H1 there has been an increase in general and administrative expense by 6.8% (EUR 1.0 million) from EUR 15.5 million in H1 2023 to EUR 16.5 million in H1 2024, primarily driven by a rise in professional fees by 41.4% (EUR 2.2 million) from EUR 5.4 million in H1 2023 to EUR 7.6 million in H1 2024.

The decrease in depreciation and amortisation by 14.7% (EUR 1.1 million), from EUR 7.6 million in H1 2023 to EUR 6.5 million in H1 2024 was mainly attributed to a decrease in the amortisation of intangible assets (17.7%, EUR 1.1 million). The depreciation of right-of-use assets and properties, plants and equipment are at a similar level in H1 2024 as in H1 2023.

The decrease in selling and marketing expenses by 6.4% (EUR 0.5 million) (from EUR 7.2 million in H1 2023 to EUR 6.7 million in H1 2024) was mainly due to decrease in offline media expenses (decrease by 67.0%, EUR 0.8 million from EUR 1.2 million in H1 2023 to EUR 0.4 million in H1 2024).

Statement of financial position:

Assets

Total assets decreased by 0.4% (EUR 4.1 million) from EUR 990.9 million at the end of 2023 to EUR 986.8 million at the end of H1 2024. This decrease was driven by an outflow of cash and cash equivalents via the repayment of deposits from customers. The decrease in cash and cash equivalents was also driven by growth of income-generating loans to customers and debt investments. The combined growth of both line items is 9.2% when comparing the end of 2023 and the end of H1 2024.

The Group continues to see long-term benefit from debt investments in H1 2024, and as a result Multitude substantially grew its portfolio compared to the previous year (increase EUR 41.2 million, 66.3%, from EUR 62.1 million at the end of 2023 to EUR 103.3 million at the end of H1 2024).

Additionally, the decrease in right of use asset line item (by 18.9%) from EUR 4.8 million at the end of 2023 to EUR 3.9 million the end of H1 2024 is explained by an ongoing amortisation of already recognised leases with no substantial change in the scope of lease.

Liabilities

Total liabilities decreased by 0.6% (EUR 4.6 million) from EUR 807.2 million at the end of 2023 to EUR 802.7 million at the end of H1 2024. The main changes in total liabilities occurred due to changes in deposits from customers and debt securities. Deposits from customers decreased by 7.4% (EUR 54.0 million) from EUR 732.4 million at the end of 2023 to EUR 678.3 million at the end of H1 2024. Debt securities increased by 107.5% (EUR 51.4 million) from EUR 47.8 million at the end of 2023 to EUR 99.2 million at the end of H1 2024.

The substantial increase in provisions, accruals and other liabilities by 30.2% from EUR 13.4 million at the end of 2023 to EUR 17.4 million at the end of H1 2024 is driven by increase in accrued personnel expenses by EUR 0.8 million. The second most significant factor is EUR 0.5 million increase in balance of

other liabilities created by the received deposits related to Invoice Purchasing business of CapitalBox. The rest of difference is explained by accrued expenses for the consumed services by various Group companies.

Equity

Total equity increased by 0.3% (EUR 0.5 million) from EUR 183.7 million at the end of 2023 to EUR 184.2 million at the end of H1 2024. Profit for H1 2024 equals EUR 7.3 million which is a 4.5% decrease as compared to EUR 7.6 million in H1 2023. The total amount of dividends for 2023 paid in H1 2024 equals EUR 4.1 million.

Key performance changes in the reporting period

The impaired loan coverage ratio increased by 0.6% from 16.6% at the end of 2023 to 17.2% at the end of H1 2024, due to the higher growth in loss allowances as compared to gross loans to customers. The growth in loss allowance is mainly explained by deterioration of credit risk in SME loans in CapitalBox at the start of the year. The net equity ratio decreased by 2.0% from 26.0% at the end of 2023 to 24.0% at the end of H1 2024. Net debt to equity ratio increased from 2.85 at the end of 2023 to 3.17 at the end of H1 2024. Basic earnings per share decreased EUR 0.04 per share from EUR 0.24 per share in H1 2023 to EUR 0.20 per share in H1 2024.

Change in accounting policy and correction of errors

At the end of 2023, the Group made changes in its accounting policies regarding the presentation of financial statements. This involved reclassifying certain line items in the financial statements, correcting errors in accounting treatments and transitioning to a liquidity-based approach for the statement of financial position. As part of this endeavour, we included collection costs in determining expected credit losses, providing a more accurate portrayal of credit risks. Additionally, the treatment of reminder fees shifted from IFRS 15 to IFRS 9. We also revised practices regarding scoring costs, capitalising them as incremental costs directly linked to loan issuance, impacting the effective interest rate calculation and interest income.

These revisions result in changes to the overall presentation of the Group's financial results and positions, reflecting the best practices in the lending industry for the comparative period (Note 16). The consolidated statement of financial position includes a comparative date of 1 January 2023, with other statements and disclosures for 2023 labelled as "restated".

Treasury update

By the end of H1 2024, Multitude's cash position stood at EUR 219.0 million. Out of this amount a significant portion is invested in short-term deposits with reputable banks, hereby generating additional interest income.

Notably, Multitude Bank has a highly diversified depositor base, with 99% of its deposits originating from customers covered by the Depositor Compensation Scheme. Significant rise in general interest rates throughout 2023 and in early 2024 led to doubling of the Group's interest expense when comparing H1 2023 to H1 2024 (from EUR 8.8 million to EUR 18.7 million.)

On 15 February 2024, Fitch Ratings revised Multitude SE's and its fully owned Multitude Bank p.l.c.'s outlook from Stable to Positive, while affirming their Long-Term Issuer Default Ratings (IDRs) at 'B+'.

On 12 June 2024, Multitude Capital Oyj, an issuance vehicle wholly owned by Multitude SE, successfully launched a 4-year senior unsecured bond issue amounting to EUR 80 million. This transaction was conducted under a EUR 150 million issuance program, allowing for additional volume increases at a later stage. The proceeds from this bond were used for the redemption of the EUR 50 million bond of Multitude SE issued in December 2022, including settlement of the call option premium. As of 30 June 2024, a nominal amount of EUR 24.2 million was redeemed.

Personnel update

The average number of employees in H1 2024 is equal to 749 HC (H1 2023 – 671 HC) with related personnel expense amounting to EUR 18.9 million (H1 2023 – EUR 16.8 million).

1. Alain Nydegger appointed as Tribe CEO of Wholesale Banking

Effective 15 April 2024, Alain Nydegger has been appointed as the Tribe CEO for Wholesale Banking and has joined the Group Leadership Team. Alain has previously held the CEO position at Pala Assets, where he has enhanced their global high-yield credit portfolio and has led the successful restructuring efforts across various sectors.

In addition to his finance background, Alain co-founded 21Celsius Ventures and Fashion Vestis, driving growth in tech and e-commerce platforms. He holds an Executive MBA from IMD and a

bachelor's degree in Banking and Finance from HWZ University of Applied Sciences in Business Administration Zurich.

Alain's extensive experience and strategic leadership will be invaluable to Wholesale Banking at Multitude.

2. Julie Chatterjee resigns as Chief Commercial Officer

Julie Chatterjee has resigned from her role as Chief Commercial Officer of Multitude Bank and stepped down from the Group Leadership Team and Bank Executive Committee, effective 10 May 2024. Julie was instrumental in building Sweep Bank and in positioning it for integration into the Consumer Banking and SME Banking business units.

The Leadership Team members express their gratitude for Julie's valuable contribution and professionalism during her tenure and wish her every success in her future endeavours.

Alternative performance measures

Pursuant to Article 16 of Regulation 1095/2010/EU, the European Securities and Markets Authority (ESMA) has issued specific guidelines on the presentation criteria for Alternative Performance Measures (APMs) included by European issuers in regulated information, where such measures are not defined or provided for in the rules on financial reporting.

According to the definition provided in the ESMA Guidelines, an APM is a financial measure of historical or future financial performance, financial position, or cash flows, other than a financial measure defined or specified in the applicable financial reporting framework. APMs are typically based on financial statement line items prepared in accordance with applicable financial reporting rules. What sets them apart is that APMs are not defined in the financial reporting framework, yet their use is still widespread, with the role of conveying a view of the Group's performance that is closer to the Leadership Team's perspective than would be possible using only the defined measures.

To facilitate the understanding of the consolidated statement of profit or loss after a change in presentation of consolidated financial statements in 2023, Multitude introduced profit before interest expense and taxes (EBIT) as APM as compared to prior years where it was directly reported in the consolidated statement of profit or loss. The reason for the application of APM is matching the profit

guidance given by the Board to the public on the development of Group's profitability in the future.

It is calculated by adding back income tax, interest expense, and fair value and foreign exchange gains and losses to profit for the period in the consolidated statement of profit or loss:

EBIT = Profit for the period + Income tax + Interest expense + Fair value and foreign exchange gains and losses

EUR '000	Q2 2024	H1 2024	Restated Q2 2023	Restated H1 2023
Profit for the period	4,673	7,251	5,315	7,596
Interest expense	10,090	18,670	4,920	8,832
Income tax expense	732	1,150	1,305	2,057
Fair value and foreign exchange gains and losses	1,193	1,229	645	2,563
Profit before interest expense and taxes (EBIT)	16,688	28,299	12,186	21,048

EBIT for the consolidated Group in H1 2024 and H1 2023:

It should be noted in this regard that the APM presented is complementary to the measures defined within the IFRS Accounting Standards. The figures and inputs, used in the derivation of the said APM, are based on presentation and / or disclosure requirements emanating from the IFRS Conceptual Framework and include reconciliation items from such presentation / disclosures of financial statements.

Risk factors and risk management

Multitude takes moderate and calculated risks in conducting its business. The prudent management of risks minimises the probability of unexpected losses and threats to our reputation. Therefore, we can enhance profitability and shareholder value.

The Leadership Team and business unit CEOs monitor operations regularly and are responsible for adequate risk management and ensuring that the Group is able to control and monitor its risks. Each Leadership Team member bears responsibility for identifying and controlling the risks related to their functions in line with instructions from the Board. The Board is ultimately charged with, inter alia, the overall responsibility to oversee the risk management of the Group via its Risk Committee.

We proactively follow all legal regulations, monitor changes that might occur in the countries we operate in and, where necessary, adjust operations accordingly.

The Group's risk exposures can be divided into three main categories:

Credit risks (mainly receivables from customers and debt investments)

1.1 Consumer Banking and SME Banking

Exposure to credit risks arises principally from the Group's lending activities. The credit risk is managed by experienced risk teams from the Risk Management function, which manage the Group's scoring system and credit policies. The Risk Management function is also responsible for the measurement of the payment behaviour of the credit portfolio on a daily, weekly, and monthly basis. This is done through proprietary risk management tools, which assist Group companies in evaluating the customer's payment behaviour. These tools, which are continuously updated and refined, ensure that only customers with a satisfactory credit profile are accepted.

1.2 Wholesale Banking

The Group is also exposed to credit risk arising from its exposure to debt investments. The debt investments mainly reflect the Group's acquisition of secured bonds. Such bonds are mainly secured either by loan portfolios or real estate, which are pledged in favour of Multitude Bank, and are subject to a number of covenants including predetermined ratios of ageing portfolios and advance rates and Loan to Values. Such covenants are monitored regularly by our Leadership Team and the relevant Committees.

Market risks (including foreign exchange risks, interest rate risks and other price risks) Multitude uses foreign currency forward contracts to hedge foreign transaction risk exposures. Market risks arise from open positions in the interest rate and products in foreign currency. They are managed by the Group's Treasury function, in close cooperation with FP&A, which is also responsible for the Group's cash flow planning and to ensure the necessary liquidity level for all Group companies.
Operational risks (such as IT risks, legal and regulatory risks and other operational risks) IT, legal and regulatory risks are highly relevant to us. The Group's Legal function manages regulatory and legal risks in close cooperation with the authorities in the respective countries and relevant stakeholders. Potential or foreseeable changes in applicable laws are analysed on an ongoing basis and any necessary modifications to the Group's operations are implemented proactively.

Statement pursuant to Capital Markets Rule 5.75.3 issued by the Malta Financial Services Authority

We hereby confirm that to the best of our knowledge:

The unaudited condensed interim financial statements set out herein give a true and fair view of the assets, liabilities and financial position of the Group as at 30 June 2024, and of its financial performance and cash flows for the period then ended, in accordance with International Financial Reporting Standards as adopted by the EU applicable to Interim Financial Reporting (IAS 34); and

The Interim Board of Directors' Report includes a fair review of the information required in terms of Capital Markets Rules 5.81 to 5.84.

Gzira, 22 August 2024

Ari Tiukkanen	Chairman of the Board
Lea Liigus	Member of the Board
Jorma Jokela CEO	Member of the Board
Marion Khüny	Member of the Board
Kristiina Leppänen	Member of the Board
Goutam Challagalla	Member of the Board

Unaudited condensed interim consolidated financial statements H1 2024

Condensed consolidated statement of profit or loss

EUR '000	Notes	Q2 2024	H1 2024	Restated Q2 2023	Restated H1 2023
Interest income	5	64,653	128,826	55,850	110,085
Interest expense	5	(10,090)	(18,670)	(4,920)	(8,832)
Net interest income		54,562	110,157	50,931	101,254
Fee and commission income		11	21	6	8
Fair value and foreign exchange losses	6	(1,193)	(1,229)	(645)	(2,563)
Other income	7	261	275	165	184
(Loss) / profit for the period from investment in associates		(117)	(152)	12	12
Net operating income		53,525	109,072	50,469	98,895
Operating expenses:
Impairment loss on loans to customers	8, 12	(23,829)	(52,105)	(21,331)	(42,210)
Personnel expense	8	(9,491)	(18,874)	(8,390)	(16,792)
General and administrative expense	8	(8,308)	(16,510)	(6,416)	(15,457)
Depreciation and amortisation	8	(3,091)	(6,476)	(3,909)	(7,590)
Selling and marketing expense	8	(3,401)	(6,706)	(3,794)	(7,164)
Other expense	7	-	-	(8)	(29)
Profit before income taxes		5,405	8,401	6,621	9,653
Income tax expense	9	(732)	(1,150)	(1,305)	(2,057)
Profit for the period		4,673	7,251	5,315	7,596
Earnings per share:
Basic earnings per share, EUR	10	0.13	0.20	0.19	0.24
Diluted earnings per share, EUR	10	0.13	0.20	0.18	0.23

Condensed consolidated statement of comprehensive income

EUR '000	Q2 2024	H1 2024	Restated Q2 2023	Restated H1 2023
Profit for the period	4,673	7,251	5,315	7,596
Other comprehensive expense:
Items that may be reclassified to profit or loss
Currency translation difference	128	(170)	(1,416)	(1,101)
Total other comprehensive loss	128	(170)	(1,416)	(1,101)
Total comprehensive income for the period	4,801	7,081	3,899	6,495

Condensed consolidated statement of financial position

EUR '000	Notes	30 June 2024	31 December 2023	Restated 1 January 2023
ASSETS
Cash and cash equivalents	13	218,996	283,712	153,325
Derivative financial assets	13	58	299	3,180
Loans to customers	12, 13	593,701	575,948	507,075
Debt investments	13	103,282	62,114	21,107
Other financial assets	13	20,478	19,435	19,413
Current tax assets		2,377	1,832	2,230
Prepaid expenses and other assets		3,147	2,841	237
Intangible assets		31,479	29,468	31,400
Right-of-use assets		3,909	4,819	4,613
Property, plant and equipment		2,618	2,896	3,081
Investments accounted for using the equity method		870	1,022	-
Deferred tax assets		5,932	6,492	7,574
Total assets		986,845	990,878	753,235
EQUITY AND LIABILITIES
Liabilities:
Derivative financial liabilities	13	1,876	5,323	446
Deposits from customers	13	678,311	732,350	503,378
Current tax liabilities		553	2,268	921
Provisions, accruals and other liabilities		17,414	13,372	15,576
Debt securities	13	99,196	47,805	47,416
Lease liabilities		4,104	4,963	4,566
Deferred tax liabilities		1,224	1,151	966
Total liabilities		802,679	807,232	573,269
Equity:
Share capital		40,190	40,134	40,134
Treasury shares		(148)	(103)	(142)
Retained earnings		87,991	87,258	75,685
Unrestricted equity reserve		14,652	14,708	14,708
Perpetual bonds		45,000	45,000	50,000
Translation differences		(3,552)	(3,382)	(3,050)
Other reserves		31	31	2,631
Total equity		184,166	183,646	179,966
Total equity and liabilities		986,845	990,878	753,235

Condensed consolidated statement of cash flows

EUR '000	Q2 2024	H1 2024	Restated Q2 2023	Restated H1 2023
CASH FLOWS FROM OPERATING ACTIVITIES
Profit for the period	4,673	7,251	5,315	7,596
Adjustments for:
Impairment loss on loans to customers	23,829	52,105	21,331	42,210
Depreciation and amortisation	3,092	6,476	3,909	7,590
Net interest income	(54,563)	(110,157)	(50,931)	(101,254)
Fair value and foreign exchange gains and losses	1,193	1,229	645	2,563
Income tax expense Other adjustments	732 368	1,150 628	1,305 164	2,057 286
Changes in operating assets:
Increase (-) in gross loans to customers	(28,292)	(69,858)	(30,140)	(51,291)

Increase (-) in debt investments	(34,839)	(41,168)	(13,817)	(17,277)
Decrease (+) / increase (-) in derivative financial instruments (net)	383	(3,688)	(764)	230
Decrease (+) / increase (-) in other assets	785	(1,348)	5,834	(198)
Changes in operating liabilities:
Decrease (-) / increase (+) in deposits from customers	(25,073)	(54,039)	(11,097)	69,750
Increase (+) / decrease (-) in other liabilities	2,564	3,185	(52)	1,377
Interest paid	(12,644)	(19,169)	(2,749)	(4,675)
Interest received	68,899	125,751	51,261	99,666
Income taxes paid	(1,342)	(1,650)	(645)	(486)
Net cash flows (used in) / from operating activities	(50,237)	(103,303)	(20,432)	58,143
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of tangible assets	(163)	(253)	-	-
Disposal of tangible assets Purchase of intangible assets	- (3,042)	- (6,400)	388 (2,609)	146 (5,009)
Purchase of investments accounted for using the
equity method	-	-	(1,016)	(1,016)
Purchase of business combinations	(527)	(527)	-	-
Net cash flows (used in) investing activities	(3,732)	(7,180)	(3,237)	(5,879)
CASH FLOWS FROM FINANCING ACTIVITIES
Payment of perpetual bonds interest	(1,402)	(2,754)	(1,480)	(2,845)
Repayment of perpetual bonds	-	-	(1,875)	(1,875)
Dividends paid	(4,116)	(4,116)	(2,589)	(2,589)
Proceeds from debt securities	74,181	74,181	-	-
Repayment of debt securities	(20,192)	(20,192)	-	-
Repayment of lease liabilities	(457)	(1,169)	(542)	(1,104)
Purchase of treasury shares	(89)	(89)	-	-
Net cash flows from / (used in) financing activities	47,925	45,861	(6,485)	(8,413)
Cash and cash equivalents, as at 1 January	225,033	283,712	227,171	153,326
Exchange gains / (losses) on cash and cash equivalents	6	(94)	(309)	(469)
Net (decrease) / increase in cash and cash equivalents	(6,043)	(64,622)	(30,155)	43,850
Cash and cash equivalents, as at 30 June	218,996	218,996	196,707	196,707

Condensed consolidated statement of changes in equity

EUR '000	Share capital	Treasury shares	Retained earnings	Perpetual bonds	Unrestricted equity reserve	Translation differences	Other reserves	Total equity
At 1 January 2023	40,134	(142)	75,685	50,000	14,708	(3,050)	2,631	179,966
Comprehensive income
Profit or loss for the period	-	-	7,596	-	-	-	-	7,596
Currency translation difference	-	-	-	-	-	(1,101)	-	(1,101)
Total comprehensive income	-	-	7,596	-	-	(1,101)	-	6,495
Transactions with owners
Repayment of perpetual bonds	-	-	-	(2,000)	-	-	-	(2,000)
Perpetual bonds interests payments	-	-	(2,506)	-	-	-	-	(2,506)
Share-based payments	-	46	211	-	-	-	-	257
Dividend distribution	-	-	(2,589)	-	-	-	-	(2,589)
Total transactions with owners	-	46	(4,883)	(2,000)	-	-	-	(6,838)

Restated at 30 June 2023	40,134	(97)	78,399	48,000	14,708	(2,100)	2,631	179,623
At 1 January 2023	40,134	(142)	75,685	50,000	14,708	(3,050)	2,631	179,966
Comprehensive income
Profit or loss for the period	-	-	16,438	-	-	-	-	16,438
Currency translation difference	-	-	-	-	-	(333)	-	(333)
Total comprehensive income	-	-	16,438	-	-	(333)	-	16,105
Transactions with owners
Repayment of perpetual bonds	-	-	445	(5,000)	-	-	-	(4,555)
Perpetual bonds interests payments	-	-	(5,831)	-	-	-	-	(5,831)
Share-based payments	-	39	511	-	-	-	-	550
Dividend distribution	-	-	(2,591)	-	-	-	-	(2,591)
Release of reserves	-	-	2,600	-	-	-	(2,600)	-
Total transactions with owners	-	39	(4,866)	(5,000)	-	-	(2,600)	(12,427)
At 31 December 2023	40,134	(103)	87,258	45,000	14,708	(3,382)	31	183,646
At 1 January 2024	40,134	(103)	87,258	45,000	14,708	(3,382)	31	183,646
Comprehensive income
Profit or loss for the period	-	-	7,251	-	-	-	-	7,251
Currency translation difference	-	-	-	-	-	(170)	-	(170)
Total comprehensive income	-	-	7,251	-	-	(170)	-	7,081
Transactions with owners
Perpetual bonds interests payments	-	-	(2,902)	-	-	-	-	(2,902)
Share-based payments	-	44	500	-	-	-	-	544
Dividend distribution	-	-	(4,116)	-	-	-	-	(4,116)
Purchase of treasury shares	-	(89)	-	-	-	-	-	(89)
Increase in share capital	56	-	-	-	(56)	-	-	-
Total transactions with owners	56	(45)	(6,518)	-	(56)	-	-	(6,563)
At 30 June 2024	40,190	(148)	87,991	45,000	14,652	(3,552)	31	184,166

Notes to condensed interim consolidated financial statements

1. General information

In this report, "Multitude," "the Group," and "we" are used interchangeably. Multitude is a listed European FinTech company offering digital lending and online banking services to consumers, small and medium-sized enterprises (SMEs), and other FinTechs overlooked by traditional banks. We provide services through three independent business units, supported by our internal Banking-as-a-Service (BaaS) growth platform. The parent company Multitude SE (business identity code 1950969-1) was established in 2005 and as of 30 June 2024 was headquartered at Ratamestarinkatu 11 A, FI-00520 Helsinki. Since 1 July 2024, the parent company is headquartered at ST Business Centre 120, The Strand, Gzira, GZR 1027, Malta.

Multitude SE is listed on the Prime Standard of Frankfurt Stock Exchange under the symbol "E4I" (formerly under "FRU"). The Group owns Multitude Bank p.l.c., licensed by the Malta Financial Services Authority (MFSA), which is a significant part of the Group, and allows it to provide financial services and products to European Economic Area (EEA).

1.1 Significant changes in the current reporting period

Relocation

Multitude SE announced on 5 January 2024 its plan to relocate from Finland to Switzerland while maintaining its legal personality and without dissolution. On 17 January 2024, Multitude SE announced that as a first phase of the plan to relocate to Switzerland.

The transfer of the registered office from Finland to Malta would be followed by a conversion of Multitude SE into a public limited liability company, governed by the laws of Malta and then an application to have the parent company registered in Switzerland, pursuant to applicable Maltese and Swiss laws, by the end of the year 2024. On 21 March 2024, Multitude's shareholders held an Extraordinary General Meeting and approved the proposal of transferring the registered office of Multitude SE from Finland to Malta in accordance with the Council Regulation (EC) No 2157/2001 of 8 October 2001 on the Statute for a European Company (SE).

In anticipation and in pursuance of the transfer of the registered office, the Extraordinary General Meeting resolved to amend the parent company's current Articles of Association to introduce a nominal value for Multitude's shares by adding a new Article 10 in the Articles of Association which reads as follows: The nominal value of the shares is EUR 1.85. The Extraordinary General Meeting resolved to increase the parent company's share capital by EUR 55,766 from EUR 40,133,560 to EUR 40,189,326. The increase has been carried out by transferring the necessary amount from the invested unrestricted equity reserve to the share capital.

The Extraordinary General Meeting also resolved to appoint Ganado Services Limited (Registration Number: C10785) having its registered office at 171, Old Bakery Street, Valletta VLT1455, Malta as the company secretary of the parent company, with effect from the date of registration of the parent company with the Malta Business Registry.

Upon the registration of the parent company with the Malta Business Registry, Pricewaterhouse Coopers (Registration Number: AB/26/84/38), domiciled at 78, Mill Street, Qormi, Malta was appointed as the auditors of parent company until the close of the Annual General Meeting to be held in year 2024. The Group's Audit Committee will be authorised to fix their remuneration and sign any engagement letter as may be required for the purposes of finalising the engagement of the auditors.

Acquisition of Omniveta

CapitalBox acquired the business of Copenhagen-based Omniveta Finance in an asset-transaction on 1 March 2024. The transaction has been classified as a business combination, since the transaction included the transfer of customer lists, software, processes and systems necessary to run the aggregate as a business.

The acquired business contributed revenues of EUR 332 thousand to the Group for the period from 1 March to 30 June 2024. If the acquisition had occurred on 1 January 2024, consolidated pro-forma revenue for H1 2024 would have been EUR 129 thousand. These amounts have been calculated considering only the revenues generated by the acquired assets and does not include any cross-selling revenues. The effects of the acquisition in the net results of the Group cannot be determined, since the newly acquired business has been immediately deeply integrated with the existing SME Banking business unit.

Details of the purchase consideration, the net assets acquired, and goodwill are as follows.

Purchase consideration at the acquisition date:

	EUR '000
Purchase consideration:
Cash paid at the acquisition date	425
Contingent consideration	370
Total purchase consideration	795

If certain predetermined KPIs would have been achieved, a consideration of EUR 425 thousand would have been paid out (contingent consideration). The fair value of the contingent was estimated based on the expected future outflows.

At the acquisition date, the Group recognised the identifiable assets acquired and the liabilities assumed in the business combination:

	EUR '000
Software	513
Customer list	321
Other assets	24
Employee related liabilities	(83)
Total	775

A goodwill of EUR 20 thousand has been recognised as a result of the business combination. The goodwill is attributable to the synergies expected by combining the business of the acquiree with the existing CapitalBox product portfolio. The goodwill will not be deductible for tax purposes.

The above disclosed amounts differ from the amounts disclosed in the Q1 2024 interim report, as at the date of finalisation of the named report, the fair values included were still provisional. Subsequent to publication of the Q1 2024 report, the contingent consideration has been paid out, and the calculation of the fair values of the acquired assets and liabilities has been finalised, therefore the business combination can be considered complete.

Purchase consideration – cash outflow:

	EUR '000
Outflow of cash to acquire the business:
Cash paid at the acquisition date	425
Final contingent consideration paid in cash	102
Net cash outflow – investing activities	527

The difference between the fair value of the contingent consideration and the amount finally paid (EUR 259 thousand) has been recognised as a gain and presented in other income line item in the statement of profit and loss.

Acquisition-related costs of EUR 103 thousand are included in the general and administrative expense line item in the statement of profit or loss.

Other costs of EUR 70 thousand have been included in the personnel expense line item in the statement of profit or loss. These costs are related to services provided before the business combination, therefore have not been included in the calculation of the consideration transferred.

New business unit

In January 2024, Multitude implemented its previously announced plans to optimise its business units. As a result, the Wholesale Banking business unit has been established. This unit incorporates parts of SweepBank, which has since ceased to exist as a separate business unit. The Wholesale Banking business unit, operating under the Multitude Bank brand, is led by Alain Nydegger, who was appointed as its CEO in 2024. Wholesale Banking offers Secured Debt and Payment Solutions. The Secured Debt product was previously reported under the SweepBank business unit, with the underlying financial assets presented as debt investments in the consolidated statement of financial position.

Placing of EUR 80 million guaranteed unsecured bond

On 13 June 2024, Multitude SE announced the successful placement of EUR 80 million senior unsecured bonds (NO0013259747) with maturity in July 2028 (the "Bonds"). The Bonds have been issued by Multitude Capital Oyj, a wholly owned Finnish subsidiary of Multitude SE. Multitude SE has acted as guarantor of the new Bonds.

The net proceeds from the Bonds have been used towards refinancing Multitude SE's outstanding senior bonds maturing in December 2025 (NO0012702549), for which a call option has been exercised simultaneously, and general corporate purposes of the Group.

The Bond issuance saw strong demand from both existing and new investors and will carry a floating rate coupon of 3-month Euribor plus 6.75% and was priced at 97.6% of the nominal amount. On 28 June 2024, the bonds have been listed on the Frankfurt Stock Exchange Open Market. A secondary listing on a regulated market is expected to follow withing six months of the initial listing.

Fitch Ratings has previously assigned Multitude SE with a Long-Term Issuer Default Rating (IDR) at 'B+' with a Positive Outlook and the long-term rating of the outstanding senior unsecured bonds issued by Multitude SE at 'B+'. The new Bonds received 'B+' rating by Fitch Ratings on 14 June 2024 following receipt of the final issue documents.

2. Summary of material accounting policies

2.1 Basis of preparation

This condensed consolidated interim financial report for the six-month reporting period ended 30 June 2024 has been prepared in accordance with IAS 34 Interim Financial Reporting. The interim report does not include all the notes of the type normally included in an annual financial report. Accordingly, this report is to be read in conjunction with the annual report for the year ended 31 December 2023 and any public announcements made by Multitude during the interim reporting period.

The consolidated financial statements have been prepared on a historical cost basis, except for derivative financial instruments which are measured at fair value through profit or loss (FVPL). The consolidated financial statements are presented in thousand Euros ("EUR 000"). Multitude has applied similar accounting judgements, estimates, and assumptions for this interim report as those included in the annual report for the year ended 31 December 2023. The Group has prepared its consolidated financial statements on the basis that it will continue to operate as a going concern.

2.2 Statement of compliance

The condensed consolidated financial statements of the Group have been prepared in accordance with IFRS accounting standards as issued by the International Accounting Standards Board (IASB) and adopted by the European Union.

In terms of Capital Markets Rule 5.75.5, this condensed consolidated interim financial report has not been audited by the Group's independent auditors.

2.3 Presentation of financial statements

The Group presents its statement of financial position in order of liquidity based on Multitude's intention and perceived ability to recover / settle the majority of assets / liabilities of the corresponding financial statement line item. An analysis regarding recovery or settlement within 12 months after the reporting date (current) and more than 12 months after the reporting date (non– current) is presented in Note 11.

2.4 New standards and amendments

This chapter provides a summary of (a) new standards and amendments that are effective for the first time for periods commencing on or after 1 January 2024 (i.e. year ending 31 December 2024) and (b) IFRS Interpretations Committee agenda decisions issued in the last six months, that the Group has applied for the first time in this condensed interim report.

(a) New standards and amendments – applicable 1 January 2024

The following standards and interpretations apply for the first time to financial reporting periods commencing on or after 1 January 2024:

Title	Key requirements if relevant
Classification of Liabilities as Current or Non-current– Amendments to IAS 1 Non-Current Liabilities with Covenants – Amendments to IAS 1	Not relevant. The Group does not apply classification of current and non current items in the consolidated statement of financial position.
Supplier finance arrange ments – Amendments to IAS 7 and IFRS 7	Not relevant. The Group does not enter into supplier finance arrangements, therefore the amendments are not expected to have a material impact on the Group's financial statements.
Amendments to IFRS 16 Leases: Lease Liability in a Sale and Leaseback	Not relevant. The Group does not enter into sale and leaseback transactions. Therefore, these amendments are not expected to have a material impact on the Group's financial statements.

The amendments described in the table above did not have any material impact on the Group's accounting records.

(b) IFRS Interpretations Committee agenda decisions issued in the last six months, the following agenda decisions were issued that might be relevant for the preparation of annual and interim reports in 2024. The date issued refers to the date of approval by the IASB as per the IASB's website.

Date issued	Topic
30 January 2024	Merger between a Parent and Its Subsidiary in Separate Financial Statements (IAS 27).
5 March 2024	Climate-related Commitments (IAS 37 Provisions, Contingent Liabilities and Contingent Assets), Payments Contingent on Continued Employment during Handover Periods (IFRS 3 Business Combinations).
30 May 2024	Amendments to IFRS 9 and IFRS 7 - Amendments to the Classification and Mea surement of Financial Instruments.

The Group does not expect any new accounting standards or interpretations to have material impact.

3. Changes in Group companies

During H1 2024, the following entities have been established:

Multitude GmbH, domiciled in Zug, Switzerland, established with the sole purpose of protecting the Multitude brand during the relocation process and until the complete relocation of Multitude SE,
Multitude Capital Oyj, domiciled in Helsinki, Finland, established for the purpose of the bond placement mentioned in note 1.1. above.

There were no new entities created as a result of the business combination with Omniveta, as the transaction has been structured as an asset purchase. The assets acquired have been integrated into CapitalBox AB.

4. Segment information

Multitude has three business units, Consumer Banking (under Ferratum brand), SME Banking (under CapitalBox brand) and Wholesale Banking (under Multitude Bank brand), which are considered operating and reportable segments within the definition described in IFRS 8. Multitude Bank is a regulatory service provider for each business unit within the Group. The Chief Operating Decision Maker (CODM) is defined as Group CEO, who is supported by business unit CEOs. The measurement principles and allocation between business units follow the information provided to the CODM as required by IFRS 8.

The CODM monitors the operating results of its business units separately for the purpose of making decisions about resource allocation and performance assessment. Business unit performance is evaluated via multiple key indicators and is reconciled consistently to profit before income tax in the consolidated financial statements.

The presentation of segments was changed and comparative period for this Note was restated without change in the consolidated results. In November 2023, Multitude announced plans to improve its organisational structure and introduce a new business unit, Wholesale Banking. This was done by reorganising part of the SweepBank business. Operational since 1 January 2024, the new business unit is active under the Multitude Bank brand and offers two products: Secured Debt and Payment Solutions.

Simultaneously, in its financial reports, the Group renamed the Ferratum business unit to the Consumer Banking business unit while keeping the brand Ferratum. CapitalBox's business unit was renamed SME Banking, keeping CapitalBox as the brand name. The reorganisation led to the reallocation of interest income, expenses and receivables of Prime Loans to Ferratum, Sales Finance to CapitalBox and the redistribution of overhead costs among the three business units. These changes have been incorporated into the segment reporting, and the financial results of business units for the comparative periods have been restated to ensure comparability. The reconciliation between the previous presentation and the new one was published in the separate stock exchange release on 15 May 2024.

Consumer Banking - Ferratum

Ferratum offers digital loans for the individuals' daily needs, such as unplanned, short-term financing needs resulting from unexpected life events. By the end of H1 2024, Ferratum offered two distinct product categories: Instalment loans (including Plus Loans, Micro Loans, and Prime Loans) and revolving loans (Credit Limit and Credit Cards). The business unit's operations spanned across 13 markets: Bulgaria, Croatia, Czechia, Denmark, Estonia, Finland, Germany, Latvia, the Netherlands, Norway, Romania, Slovenia and Sweden.

Credit Limit, the most popular service under Ferratum, is a pre-approved credit line, also called revolving credit, which enables financial flexibility on a more continuous basis. Eligible customers are pre-approved for up to EUR 5 thousand and can withdraw money and repay without fixed amounts or timelines.

A Plus Loan caters to a customer's higher need for instant finance. Loan amounts range from EUR 300 to EUR 4,000, maturity periods between 2 and 18 months, and the loan is paid back in equal instalments over the loan period.

Micro Loans, so-called bullet loans, are for instant, short-term financing with quick repayment. They range from EUR 25 to EUR 1,000, which customers pay back in one instalment within 7-60 days.

Prime Loans are longer-term instalment loans for consumers that enable higher purchases, like home renovations, cars and more significant purchases. The loans can amount to up to EUR 15 thousand with loan maturities ranging between 1 and 7 years. In 2024, Prime Loans were moved from being issued by SweepBank to being issued by Ferratum.

The Credit Card, a Mastercard® without annual or monthly fees, allows financing smaller purchases of up to EUR 8 thousand. The card offers free liability coverage for purchases with it and up to 60 days interest-free period. Customers can also use the card as a flexible credit facility by withdrawing money from it directly into their bank account, a feature that is growing in popularity among customers.

SME Banking - CapitalBox

CapitalBox provides financing solutions to small and medium-sized enterprises (SMEs). By the end of H1 2024, CapitalBox had established five distinct products: Secured Loans, Instalment Loans, Credit Lines, Purchase Financing (BNPL) and Invoice Purchasing. CapitalBox operated in five markets: Finland, Sweden, Denmark, Lithuania, and the Netherlands.

One of the key offerings from CapitalBox is its unsecured Instalment Loans, which extend up to EUR 350 thousand. These loans come with flexible repayment periods spanning 6 to 48 months. They are specifically tailored to assist SMEs in funding various aspects of their operations such as expansion, inventory management, marketing efforts, hiring new personnel, and acquiring or leasing equipment. On average, businesses borrow around EUR 21,300 with a typical loan duration of 22 months.

Another financing option provided by CapitalBox is the Credit Line. This dynamic form of financing grants SMEs access to a credit limit ranging from EUR 2 thousand to EUR 150 thousand. Additionally, CapitalBox collaborates with retail partners to offer financing solutions to business customers, enabling them to make purchases right at the point of sale.

In the year 2023, CapitalBox introduced a new product known as the Secured Loan. This product was launched initially in Finland and Lithuania and is planned to be rolled out in other markets as well. The Secured Loan is designed to support larger investments to drive growth for SMEs. The loan amount can go as high as EUR 3 million.

With the acquisition of Omniveta, CapitalBox expanded its product offering to SMEs with a new product, Invoice Purchasing. Now CapitalBox customers can sell as many – or as few – invoices as they need. This may be, for example, in periods when the need for liquidity is greater than in others. Unlike traditional factoring, CapitalBox does not impose any requirements on which invoices can be sold, the amount of revenue required, or the length of time customer needs to commit its revenue to CapitalBox.

Wholesale Banking – Multitude Bank

Wholesale Banking is Multitude's newest business unit and offered under the Multitude Bank brand. The Wholesale Banking business unit provides Secured Debt funding against lending portfolios or other assets pledged as collateral, while loan-to-value ratios protect against credit losses. The robust experience of nearly two decades, digital approach, efficient risk management tools, and internal and external data utilisation allow for an exceptionally swift underwriting process - typically concluding in just around six weeks.

Wholesale Banking offers all the necessary elements for successful end-to-end payment operations for other banks, payment institutions and electronic money institutions. This Payment Solutions product supports core payment processes and serves as a reliable daily business support or a fallback option for managing payment rails, facilitating receiving and making payments, and managing accounts efficiently.

The results of operations from the Group's operating and reportable segments for the current period H1 2024 and comparable period H1 2023 are shown in the tables below.

EUR '000	Consumer Banking	SME Banking	Wholesale Banking	Total
Interest income	53,506	8,320	2,827	64,653
Interest expense	(6,616)	(2,022)	(1,452)	(10,090)
Net interest income	46,890	6,298	1,375	54,563
Fee and commission income	11	-	-	11
Fair value and foreign exchange losses	(933)	(260)	-	(1,193)
Other income	2	259	1	261
Loss for the period from investment in associates	-	-	(117)	(117)
Net operating income	45,969	6,297	1,260	53,525
Operating expenses:
Impairment loss on loans to customers	(19,741)	(4,008)	(81)	(23,829)
Personnel expense	(6,429)	(2,472)	(591)	(9,491)
General and administrative expense	(6,153)	(1,611)	(544)	(8,308)
Depreciation and amortisation	(2,621)	(375)	(95)	(3,091)
Selling and marketing expense	(2,186)	(1,174)	(41)	(3,401)
Profit (loss) before income tax	8,839	(3,343)	(92)	5,405
Loans to customers	462,810	130,154	737	593,701
Debt investments	-	-	103,282	103,282

Operating and reportable segments for Q2 2024

Operating and reportable segments for H1 2024

EUR '000	Consumer Banking	SME Banking	Wholesale Banking	Total
Interest income	107,637	16,043	5,146	128,826
Interest expense	(12,568)	(3,656)	(2,446)	(18,670)
Net interest income	95,069	12,387	2,700	110,157
Fee and commission income	21	-	-	21
Fair value and foreign exchange losses	(962)	(267)	-	(1,229)
Other income	13	261	1	275
Loss for the period from investment in associates	-	-	(152)	(152)
Net operating income	94,141	12,381	2,549	109,072
Operating expenses:
Impairment loss on loans to customers	(43,973)	(7,985)	(148)	(52,105)
Personnel expense	(13,035)	(4,645)	(1,194)	(18,874)
General and administrative expense	(12,293)	(3,204)	(1,013)	(16,510)
Depreciation and amortisation	(5,600)	(697)	(178)	(6,476)
Selling and marketing expense	(4,343)	(2,297)	(66)	(6,706)
Profit (loss) before income tax	14,897	(6,447)	(50)	8,401
Loans to customers	462,810	130,154	737	593,701
Debt investments	-	-	103,282	103,282

Operating and reportable segments for restated Q2 2023

EUR '000	Consumer Banking	SME Banking	Wholesale Banking	Total
Interest income	49,184	5,645	1,022	55,850
Interest expense	(3,688)	(1,009)	(222)	(4,920)
Net interest income	45,496	4,636	800	50,931
Fee and commission income	6	-	-	6
Fair value and foreign exchange losses	(525)	(120)	-	(645)
Other income	143	7	16	165
Profit for the period from investment in associates	-	-	12	12
Net operating income	45,120	4,523	828	50,469
Operating expenses:
Impairment loss on loans to customers	(19,682)	(1,646)	(2)	(21,331)
Personnel expense	(6,299)	(1,739)	(351)	(8,390)
General and administrative expense	(5,064)	(1,035)	(319)	(6,416)
Depreciation and amortisation	(3,602)	(280)	(27)	(3,909)
Selling and marketing expense	(2,973)	(806)	(15)	(3,794)
Other expense	19	(27)	-	(8)
Profit (loss) before income tax	7,519	(1,010)	114	6,621
Loans to customers	427,402	90,995	148	518,544
Debt investments	-	-	38,385	38,385

Operating and reportable segments for restated H1 2023

EUR '000	Consumer Banking	SME Banking	Wholesale Banking	Total
Interest income	97,097	11,166	1,823	110,085
Interest expense	(6,615)	(1,862)	(355)	(8,832)
Net interest income	90,482	9,304	1,468	101,254
Fee and commission income	8	-	-	8
Fair value and foreign exchange losses	(2,104)	(459)	-	(2,563)
Other income	172	1	11	184
Profit for the period from investment in associates	-	-	12	12
Net operating income	88,558	8,846	1,491	98,895
Operating expenses:
Impairment loss on loans to customers	(39,742)	(2,462)	(5)	(42,210)
Personnel expense	(12,704)	(3,404)	(683)	(16,792)
General and administrative expense	(12,417)	(2,310)	(731)	(15,457)
Depreciation and amortisation	(7,020)	(520)	(50)	(7,590)
Selling and marketing expense	(5,707)	(1,416)	(41)	(7,164)
Other expense	-	(29)	-	(29)
Profit (loss) before income tax	10,968	(1,295)	(19)	9,653
Loans to customers	427,402	90,995	148	518,544
Debt investments	-	-	38,385	38,385

5. Interest income and expense

Interest income is the main income from the Group's operations, and hence it is disaggregated into categories for analysis purposes based on the source asset types.

Interest income

EUR '000	Q2 2024	H1 2024	Restated Q2 2023	Restated H1 2023
Interest income on loans to customers	61,035	121,330	54,180	107,659
Interest income on debt investments	2,713	4,903	1,098	1,698
Interest income on bank deposits	905	2,593	573	728
Total interest income	64,653	128,826	55,850	110,085

The Group analyses interest income by type and the geographic market that represents how economic factors impact the nature, amount, timing, uncertainty, and cash flows of the above income streams. Interest income is recognised per geographic area, showing the included countries, for the current and comparative periods, as follows:

Interest income by geographic market

EUR '000		Q2 2024	H1 2024	Restated Q2 2023	Restated H1 2023
Country of domicile*	Finland	6,701	13,315	6,354	12,587
Northern Europe	Sweden, Denmark, Norway	21,329	42,395	17,741	35,329
Western Europe	Germany, Netherlands, Spain	12,671	25,356	10,543	20,478
Eastern Europe**	Bulgaria, Croatia, Czechia, Estonia, Latvia, Lithuania, Poland, Romania	23,418	46,666	20,818	40,891
Other	Australia, Brazil, Mexico	535	1,095	394	800
Total interest income		64,653	128,826	55,850	110,085

* The country of domicile was changed to Malta since the 1 of July 2024.

** There are no active business or portfolios in Belarus, Ukraine, or Russian Federation.

A breakdown of interest expense by type for the current reporting period and comparative period is presented in the table below.

Interest expense

EUR '000	Q2 2024	H1 2024	Restated Q2 2023	Restated H1 2023
Interest expense on debt securities	(2,877)	(4,223)	(1,359)	(2,746)
Interest expense on deposits from customers	(7,120)	(14,265)	(3,419)	(5,872)
Interest expense on lease liabilities	(93)	(182)	(141)	(213)
Total interest expense	(10,090)	(18,670)	(4,920)	(8,832)

6. Fair value and foreign exchange gains and losses

EUR '000	Q2 2024	H1 2024	Restated Q2 2023	Restated H1 2023
Realised foreign exchange gain (loss)	1,214	859	(355)	(511)
Unrealised foreign exchange (loss) gain	(1,971)	(1,263)	289	(639)
Realised gain (loss) on derivative financial assets and liabilities	1,117	(1,129)	1,319	2,118
Unrealised (loss) gain on derivative financial assets and liabilities	(1,553)	304	(1,899)	(3,532)
Total fair value and foreign exchange losses	(1,193)	(1,229)	(645)	(2,563)

Most of the foreign exchange impact on the profit and loss statement is generated by Swedish Krona monetary items on the balance sheets of Group companies. The impact is mitigated by the utilisation of foreign exchange forward contracts.

7. Other income and expenses

EUR '000	Q2 2024	H1 2024	Restated Q2 2023	Restated H1 2023
OTHER INCOME:
Gain from disposal of property, plant and equipment	-	1	-	-
Gain from disposal of right-of-use assets	-	1	-	-
Other income*	261	273	165	184
Total other income	261	275	165	184
OTHER EXPENSES:
Loss from disposal of non-current assets	-	-	(8)	(29)
Total other expenses	-	-	(8)	(29)

* Out of which 259 thousand relates to gain on revaluation of contingent consideration for the purchase of Omniveta business

8. Operating expenses

The Group manages expenses mostly by their nature. The disclosure of the expenses by their nature for the current financial period and the comparative period is presented in the table below:

EUR '000	Q2 2024	H1 2024	Restated Q2 2023	Restated H1 2023
Impairment loss on loans to customers	(23,829)	(52,105)	(21,331)	(42,210)
Personnel expense	(9,491)	(18,874)	(8,390)	(16,792)
General and administrative expense	(8,308)	(16,510)	(6,416)	(15,457)
Depreciation and amortisation	(3,092)	(6,476)	(3,909)	(7,590)
Selling and marketing expense	(3,401)	(6,706)	(3,794)	(7,164)
Total operating expenses	(48,121)	(100,671)	(43,840)	(89,212)

Impairment loss on loans to customers includes EUR 2.2 million of invoicing and collection costs in H1 2024 (H1 2023: EUR 2.0 million). The year-over-year increase in impairment loss is primarily due to SME loans to customers in Q1 2024, with an improvement in the trend observed in Q2 2024.

Personnel expense increased year-over-year due to the additional hires and increase in sharebased payment expense related to matching share plans. Share-based payment expense increased from EUR 257 thousand in H1 2023 to EUR 418 thousand in H1 2024. The rest of the increase is driven by salaries and wages.

General and administrative expense includes depositor compensation scheme contributions for the total amount of EUR 0.1 million in H1 2024 (H1 2023: EUR 1.0 million). The increase in general and administrative expense in H1 2024 is primarily attributed to professional fees, which rose from EUR 5.4 million in H1 2023 to EUR 7.6 million in H1 2024, driven by a number or strategic projects.

9. Income tax expenses

EUR '000	Q2 2024	H1 2024	Restated Q2 2023	Restated H1 2023
Current income tax expense	(236)	(505)	(891)	(1,138)
Deferred tax expense	(496)	(645)	(415)	(919)
Total income tax expense	(732)	(1,150)	(1,305)	(2,057)

Income tax expense is recognised based on estimate of the weighted average effective annual income tax rate expected for the full financial year. The estimated average annual tax rate used for the year to 30 June 2024 is 13.7%.

10. Earnings per share

Calculation of earnings per share attributable to shareholders of the Group includes an adjustment for interests paid due to perpetual bonds minus tax benefit on the interest expense arising from a classification of the perpetual bonds as liability (and deductibility of associated interest expense) according to Finnish tax regulations. Calculation of basic earnings per share is shown in the table below.

	Q2 2024	H1 2024	Restated Q2 2023	Restated H1 2023
Profit for the period (EUR '000)	4,673	7,251	5,315	7,596
Perpetual bonds interests recognised directly in retained earnings, net of tax (EUR '000)	(1,875)	(2,902)	(1,268)	(2,506)
Profit for the period, after perpetual bond interest (EUR '000)	2,798	4,349	4,048	5,090
Weighted average number of ordinary shares in issue	21,634	21,634	21,578	21,578
Basic earnings per share attributable to the ordinary equity holders, EUR	0.13	0.20	0.19	0.24

Calculation of diluted earnings per share is shown in the table below.

	Q2 2024	H1 2024	Restated Q2 2023	Restated H1 2023
Profit for the period (EUR '000)	4,673	7,251	5,316	7,596
Perpetual bonds interests recognised directly in retained earnings, net of tax (EUR '000)	(1,875)	(2,902)	(1,268)	(2,506)
Profit for the period, after perpetual bond interest (EUR '000)	2,798	4,349	4,048	5,090
Weighted average number of ordinary shares and potential ordinary shares*	22,352	22,352	21,724	21,724
Diluted earnings per share attributable to the ordinary equity holders, EUR	0.12	0.19	0.18	0.23

*Weighted number of ordinary shares is adjusted by weighted number of potential shares derived from matching share plan.

The calculation of weighted average number of ordinary shares used in determination of earnings per share is shown in the table below.

'000	Q2 2024	H1 2024	Restated Q2 2023	Restated H1 2023
Weighted average number of ordinary shares used as the denominator in calculating basic earnings per share	21,634	21,634	21,578	21,578
Adjustments for calculation of diluted earnings per share:
- Matching share plan	749	749	146	146
Weighted average number of ordinary shares and potential ordinary shares used as the denominator in calculating diluted earnings per share	22,383	22,383	21,724	21,724

11. Current and non-current assets and liabilities

Asset and liability line items by amounts recovered or settled within or after one year as at 30 June 2024:

EUR '000	Within one year	After one year	Total as at 30 June 2024
ASSETS:
Cash and cash equivalents	218,996	-	218,996
Derivative financial assets	58	-	58
Loans to customers	414,253	179,447	593,701
Debt investments	1,997	101,285	103,282
Current tax assets	2,377	-	2,377
Other financial assets	13,266	7,212	20,478
Prepaid expenses and other assets	3,147	-	3,147
Intangible assets	-	31,479	31,479
Right-of-use assets	-	3,909	3,909
Property, plant and equipment	-	2,618	2,618
Investments accounted for using the equity method	-	870	870
Deferred tax assets	-	5,932	5,932
Total	654,094	332,752	986,845
LIABILITIES:
Derivative financial liabilities	1,876	-	1,876
Deposits from customers	393,605	284,706	678,311
Provisions, accruals and other liabilities	17,414	-	17,414
Current tax liabilities	553	-	553
Debt securities	193	99,003	99,196
Lease liabilities	1,558	2,547	4,104
Deferred tax liabilities	-	1,224	1,224
Total	415,200	387,480	802,679

Asset and liability line items by amounts recovered or settled within or after one year as at 31 December 2023:

EUR '000	Within one year	After one year	Total as at 31 December 2023
ASSETS:
Cash and cash equivalents	283,712	-	283,712
Derivative financial assets	299	-	299
Loans to customers	400,356	175,592	575,948
Debt investments	1,067	61,047	62,114
Current tax assets	1,832	-	1,832
Other financial assets	12,483	6,952	19,435
Prepaid expenses and other assets	2,840	1	2,841
Intangible assets	-	29,468	29,468
Right-of-use assets	-	4,819	4,819
Property, plant and equipment	-	2,896	2,896
Investments accounted for using the equity method	-	1,022	1,022
Deferred tax assets	-	6,492	6,492
Total	702,589	288,289	990,878
LIABILITIES:
Derivative financial liabilities	5,323	-	5,323
Deposits from customers	484,230	248,120	732,350
Provisions, accruals and other liabilities	13,372	-	13,372
Current tax liabilities	2,268	-	2,268
Debt securities	293	47,512	47,805
Lease liabilities	1,948	3,015	4,963
Deferred tax liabilities	-	1,151	1,151
Total	507,434	299,798	807,232

12. Loans to customers

The expected credit loss (ECL) for loans to customers are determined by projecting the probability of default (PD), estimated exposure of default (EAD), and loss given default (LGD) at a collective portfolio level as allowable under IFRS 9 in the case of retail portfolios comprising individually insignificant exposures that are homogenous in nature. These three components are multiplied together effectively calculating the forward-looking ECL, which is then discounted back to the reporting date. The discount rate used in the ECL calculation is the actual effective interest rate or an approximation thereof.

The 12-month ECL is calculated by multiplying the 12-month PD, LGD, and EAD. Lifetime ECL is calculated on a similar basis for the residual life of the exposure.

The PD, EAD and LGD parameters are derived from internally developed statistical models and other historical data, adjusted to reflect forward-looking information as described below in this Note.

The PD represents the likelihood of a borrower defaulting on its financial obligation (as per definition of default and credit-impaired above), either over the next 12 months (12M PD), or over the remaining lifetime (Lifetime PD) of the obligation. Accordingly, the 12-month and lifetime PDs represent the probability of default occurring over the next 12 months and the remaining maturity of the instrument, respectively.

In the case of micro lending facilities with bullet repayment characteristics, the Group utilises rollrate methodology to estimate its PDs. This methodology employs statistical analysis of historical data and experience of delinquency and default to estimate the amount of loans that will eventually be written off as unrecoverable. This methodology is applied at territory or country level with adaptations to reflect the different nature of the respective markets in which the Group operates. Under this methodology, loans are grouped into ranges according to the number of days past due and statistical analysis is used to estimate the likelihood that loans in each range will progress through the various stages of delinquency, and ultimately prove irrecoverable.

In the case of credit facilities with characteristics of instalment loans or revolving facilities, the Group utilises a curve-stitching methodology in order to estimate its PDs. Under this approach, an analysis of historical default data is carried out in order to estimate cumulative monthly loss rates at various snapshot dates. Subsequently, statistical analysis is employed in order to combine curves with different historical performance windows into a single PD curve over the expected lifetime of the micro-credit exposures. This methodology is also applied at territory or country level to incorporate adaptations to reflect the nature of the different markets in which the Group operates. Under this approach, loans are also grouped into ranges according to the number of days past due, with an individual lifetime PD curve being calculated for each range.

EAD is based on the amounts Multitude expects to be owed at the time of default, over the next 12 months (12M EAD) or over the remaining lifetime (Lifetime EAD). EAD represents the expected exposure in the event of a default (including any expected drawdowns of committed facilities).

The 12-month and lifetime EADs are determined based on the total balance of receivable at the reporting date, taking into account the total amount receivable from borrowers inclusive of principal, interest and fees that are accounted for as part of the effective interest rate. This is deemed an adequate representation of the expected balance at default in the case of the Multitude's credit facilities given that the Group models its ECLs on a collective portfolio level with the modelling of the EAD for each future month on an individual loan-by-loan basis not being deemed practical. Additionally, in the case of revolving credit facilities the Group also factors in expected drawdowns of committed facilities.

The LGD represents the Group's expectation of the extent of loss on a defaulted exposure. Hence, the LGD represents expected credit losses on the EAD given the event of default, taking into account, among other attributes, the mitigating effect of collateral values (if any) at the time it is expected to be realised and the time value of money. The LGD is determined based on the factors which impact the recoveries made post default.

Given that its credit facilities are generally unsecured in nature, the Group estimates LGD parameters based on the history of recovery rates in respect of claims against defaulted customers, which rates are highly impacted by collective debt recovery strategies. Moreover, the Group's LGDs comprise the effects of the Multitude's ability to dispose of overdue loans originated in specific territories to other parties at pre-established prices, that are dependent on the credit quality or ageing of the loans. Estimated LGDs are also impacted by historical one-off portfolio sales and the expected future uncontracted portfolio sales activity. Recoveries from loan portfolio sales are calculated on a discounted cash flow basis using the contractual interest rate as the discounting factor.

The Group has a number of contractual agreements in place with third parties by virtue of which loans which are within the stipulated days past due will be sold to a third party in batch at an agreed price. The Group is also capable of selling loans on the market.

The ECL is measured from the initial recognition of the financial asset. The maximum period considered when measuring ECL (be it 12-month or lifetime ECL) is the maximum contractual period over which Multitude is exposed to credit risk. With respect to non-revolving credit facilities, the contractual life of the facility is considered. In the case of revolving credit facilities, provided that such facilities do not have a fixed term or repayment structure, the Group defines the lifetime of such exposures as 24 months in line with observed borrower behaviour in the respective territories. The lifetime of revolving credit facilities is re-assessed by the Group at a territory level based on more recent borrower behaviour patterns on a periodic basis.

The Group performs a historical analysis to identify the key economic variables affecting credit risk and expected credit losses for each product portfolio at a territory level. These economic variables and their associated impact on the PD, EAD and LGD may vary by portfolio or territory.

The tables below show the Group's gross outstanding loans to customers balances, risk grading, and basis for ECL recognition and measurement, including the movements and balances of loss allowances for loans to customers for the periods presented:

			Days past due*
Risk grade	Category	Basis for ECL	Lower range	Upper range	UTP	30 June 2024	31 December 2023
Regular	Performing	Stage 1 (12-month ECL)	0 to 30		-	558,135	532,234
Watch	Underperforming	Stage 2 (lifetime ECL)	31 - 45	31 - 60	-	23,386	26,955
Substandard	Underperforming	Stage 2 (lifetime ECL)	46 - 60	61 - 90	-	16,617	17,309
Doubtful	Non-performing	Stage 3 (lifetime ECL)	61 - 180	91 - 180	Yes	22,561	21,661
Loss	Non-performing	Stage 3 (lifetime ECL)	days	More than 180	-	96,071	92,458
Total						716,770	690,617

Gross outstanding loans to customers risk grading and basis for ECL recognition

*Lower and upper ranges of days past due are based on DPD thresholds of 60 and 90 days, respectively, to be considered as non-performing.

At and for the period ended 30 June 2024:

EUR '000				30 June 2024
	Stage 1 12-month ECL	Stage 2 Lifetime ECL	Stage 3 Lifetime ECL	Total
GROSS LOANS TO CUSTOMERS
At 1 January 2024	532,234	44,264	114,119	690,617
Total changes in gross carrying amounts arising from transfers in stages, originations and derecognitions	29,131	(4,029)	48,187	73,289
Loans and advances written off and sold during the period	-	-	(42,987)	(42,987)
Exchange differences	(3,231)	(232)	(687)	(4,149)
Total net change during the period	25,901	(4,261)	4,513	26,153
Gross loans to customers at 30 June 2024	558,135	40,003	118,632	716,770
LOSS ALLOWANCES
At 1 January 2024	31,282	14,361	69,025	114,669
Increase in allowances - charged to profit or loss	3,296	(947)	49,756	52,105
Other movements
Unwind of discount	-	-	(34)	(34)
Loans and advances written off and sold during the period	-	-	(42,987)	(42,987)
Exchange differences	(191)	(74)	(418)	(684)
Total net change during the period	3,105	(1,021)	6,317	8,400
Loss allowance at 30 June 2024	34,387	13,340	75,342	123,069
Impaired loan coverage ratio ("ILCR")	6.16%	33.35%	63.51%	17.17%

At and for the period ended 30 June 2023:

EUR '000				30 June 2023
	Stage 1 12-month ECL	Stage 2 Lifetime ECL	Stage 3 Lifetime ECL	Total
GROSS LOANS TO CUSTOMERS
At 1 January 2023	464,238	35,617	119,939	619,794
Total changes in gross carrying amounts arising from transfers in stages, originations and derecognitions	21,898	(72)	37,009	58,835
Loans and advances written off and sold during the period	-	-	(35,304)	(35,304)
Exchange differences	(6,278)	(459)	(1,571)	(8,308)
Total net change during the period	15,620	(531)	134	15,223
Gross loans to customers at 30 June 2023	479,859	35,086	120,073	635,018
LOSS ALLOWANCES
At 1 January 2023	24,949	11,024	74,359	110,332
Increase in allowances - charged to profit or loss	3,100	344	38,766	42,210
Other movements
Unwind of discount	-	-	117	117
Loans and advances written off and sold during the period	-	-	(35,304)	(35,304)
Exchange differences	(211)	(85)	(585)	(881)
Total net change during the period	2,889	258	2,994	6,142
Loss allowance at 30 June 2023	27,838	11,282	77,353	116,473
Impaired loan coverage ratio ("ILCR")	5.80%	32.16%	64.42%	18.34%

The table below summarises the Group's movements and the balances of loss allowances for loans to customers for the year ended and as at 31 December 2023:

EUR '000	Stage 1 12-month ECL	Stage 2 Lifetime ECL	Stage 3 Lifetime ECL	Total
GROSS LOANS TO CUSTOMERS
As at 1 January 2023	464,238	35,617	119,939	619,794
Transfers in between stages:
Transfers out of Stage 1	(48,992)	20,086	28,906	-
Transfers out of Stage 2	3,171	(12,861)	9,690	-
Total changes from transfers in between Stages	(45,821)	7,225	38,596	-
Other changes in gross loans to customers
New loans originated during the year	777,408	40,590	65,294	883,292
Loans derecognised during the year	(663,086)	(39,110)	(101,137)	(803,334)
Write-offs	-	-	(8,397)	(8,397)
Exchange differences	(505)	(57)	(176)	(739)
Net changes in gross loans to customers	67,996	8,647	(5,821)	70,823
Gross loans to customers as at 31 December 2023	532,234	44,264	114,119	690,617
LOSS ALLOWANCES
Loss allowances, as at 1 January 2023	27,337	11,024	74,359	112,719
Transfers in between stages:
Transfers out of Stage 1	(3,275)	1,292	1,983	-
Increase (decrease) due to transfers out of Stage 1	-	5,089	13,675	18,764
Transfers out of Stage 2	854	(3,837)	2,984	-
Increase (decrease) due to transfers out of Stage 2	(552)	-	2,957	2,405
Increase (decrease) due to changes in DPD buckets	448	36	9,492	9,976
Total changes from transfers in between Stages	(2,525)	2,580	31,090	31,145
Other changes in loss allowances:
New financial assets originated during the year	44,413	13,296	31,479	89,187
Financial assets derecognised during the year	(38,822)	(12,540)	(63,517)	(114,879)
Write-offs	-	-	(8,397)	(8,397)
Remeasurements from changes in model	908	22	4,094	5,025
Unwind of discount	-	-	46	46
Exchange differences	(29)	(20)	(129)	(178)
Net changes in loss allowances	3,945	3,337	(5,334)	1,949
Loss allowances as at 31 December 2023	31,282	14,361	69,025	114,669
Impaired loan coverage ratio ("ICLR")	5.88%	32.44%	60.49%	16.60%

Transfers out of Stage 1 are driven by the underlying gross loans to customers to have significant increase in credit risks since initial recognition (Stage 2) or become credit-impaired (Stage 3). In contrast, transfers out of Stages 2 or 3 result from the underlying gross loans to customers no longer meeting said definitions.

Transfers in between Stages or changes within DPD buckets that do not necessarily impact the ECL model stages could also increase (decrease) loss allowances during the year.

Remeasurements from changes in ECL model, inputs and assumptions are mainly driven by updating the calculations, statistics and modelling parameters relating to EAD, PD, LGD, and EIR based on the most recent available information at the reporting date. The unwind of discount is driven by the amortisation of the ECL present value for long outstanding loans to customers.

Reconciliation of impairment loss on loans to customers to changes in loss allowances

The following table shows the breakdown of movement in loss allowances with reconciliation to profit or loss for 2023:

LOSS ALLOWANCES	Stage 1	Stage 2	Stage 3	Total
Loss allowances as at 1 January 2023	27,337	11,023	74,359	112,719
Transfers in between stages:
Transfers out of Stage 1	(3,275)	1,292	1,983	-
Increase due to transfers out of Stage 1	-	5,089	13,675	18,764
Transfers out of Stage 2	854	(3,838)	2,984	-
Increase (decrease) due to transfers out of Stage 2	(552)	-	2,956	2,404
Increase due to changes in DPD buckets	448	36	9,492	9,976
Total net changes from transfers in between Stages	(2,525)	2,579	31,090	31,144
Other changes in loss allowances:
Net remeasurement of ECLs	(12,156)	(3,927)	(19,888)	(35,971)
New financial assets originated during the year	44,413	13,296	31,479	89,188
Remeasurements from changes in model	908	22	4,094	5,024
Unwind of discount	-	-	46	46
Exchange differences	(29)	(20)	(129)	(178)
Net changes in loss allowances recognised through profit or loss statement	30,611	11,950	46,692	89,253
Financial assets derecognised during the year	(26,666)	(8,611)	(43,629)	(78,906)
Write-offs	-	-	(8,397)	(8,397)
Net changes in loss allowances	3,945	3,339	(5,334)	1,950
Loss allowances as at 31 December 2023	31,282	14,362	69,025	114,669

Macro-economic variables

The calculation of ECL incorporates forward-looking information as input for critical accounting estimate. The Group has identified key drivers of credit risk and credit losses for each portfolio of financial instruments and using an analysis of historical data, has analysed relationships between macroeconomic variables, credit risk and credit losses. This analysis is conducted at a territory and sub portfolio level in order to take into consideration possible differences in customer behaviour and default experience arising from different product characteristics.

To be able to determine the way economic conditions will be impacting the ECL estimates, the Group first performs an assessment to select the Macroeconomic Variable (MEV) which has the highest correlation to credit risk factors for a certain country and product. The Group does this through the implementation of a one-step Error Correction Model (ECM). The ECM is a multiple regression model that automatically corrects short-term deviations from the long-term equilibrium relationship such that the defaulted loan amount is restored back to its long-term equilibrium at a specific speed of adjustment.

Through the utilisation of this model the Group has determined a set of four MEVs to which the Group's portfolios are the most sensitive, namely Gross Domestic Product, Personal Disposable Income, and Unemployment Rate for consumer loans (Micro Loans, Plus Loans, Credit Limit facilities, Credit Cards and Prime Loans), whereas Consumption Rate Private is the key driver for SME loans (Secured Loans, Instalment Loans, Credit Lines, BNPL and Invoice Purchasing) and corporate loans included in Wholesale Banking business unit. The choice of macroeconomic variable to be used for a particular territory and product is determined through an optimised approach in which the ECM is run separately for each of these variables. The variable that is ultimately applied for the territory / product is the one that produces the most statistically significant result.

In order to capture a range of possible future outcomes, three possible scenarios are considered in the determination of the Group's ECL. The 'base line' scenario represents the most likely outcome. It is based on forecasted economic variables, provided by Oxford Economics, and provides the best estimate view of each respective country within the Group's lending portfolio. Apart from the 'base line' scenario, the Group considers two other macroeconomic scenarios – 'Upside' and 'Downside' scenarios – which respectively represent a more optimistic and a more pessimistic outcome, as further explained in this section.

Each scenario is weighted by a probability of occurrence, determined by a combination of macroeconomic research and expert credit judgement, taking account the range of possible outcomes, each chosen scenario represents.

The weightings assigned to each economic scenario, which are unchanged from 2022 were 60%, for the 'Base' scenario, 20% for the 'Downside' scenario and 20% for the 'Upside' scenario. The number of scenarios used is based on the analysis of each major product type to ensure that non-linearities are captured. The number of scenarios and their attributes are reassessed at each reporting date. The probability weightings assigned to the respective scenarios reflect an unbiased evaluation of the range of possible outcomes.

In relation to the debt investments, the Group also incorporates these macroeconomic forecasts in its periodical assessments on the pledged loan portfolios, in order to assess whether the Group should provide for expected credit losses. Such assessments are based on the credit information supplied by the bond issuers which the Multitude Group has invested in. In order for its ECL methodology to represent an appropriate estimation of its credit risk emanating from said investments, the Group assesses the ECL on each credit portfolio securing the Group's investment separately.

The pertinent macroeconomic variables relating to the Group's lending portfolio as at 30 June 2024, utilised in the multiple regression, are sourced from Oxford Economics and are listed below:

Unemployment rate

In %	2024			2025			2026
	Base	Down	Up	Base	Down	Up	Base	Down	Up
Bulgaria	4.68	4.72	4.65	4.59	5.01	4.43	4.74	5.33	4.55
Czechia	3.79	3.83	3.78	3.68	4.11	3.59	3.58	4.24	3.41
Denmark	2.95	3.02	2.93	2.85	3.34	2.68	2.69	3.51	2.53
Netherlands	3.83	3.88	3.80	4.14	4.65	3.95	4.25	5.07	4.09
Poland	5.02	5.07	4.98	4.80	5.27	4.54	4.60	5.20	4.38
Romania	3.24	3.31	3.19	3.22	3.80	2.89	3.11	3.88	2.90

Personal disposable income

Billion units		2024				2025		2026
	Cur.	Base	Down	Up	Base	Down	Up	Base	Down	Up
Croatia	EUR	38.70	38.52	38.75	39.27	38.90	39.36	40.12	39.96	40.10
Finland	EUR	136.87	136.63	137.00	138.41	137.81	138.82	139.60	138.63	140.10
Lithuania	EUR	33.30	33.09	33.34	34.33	34.04	34.42	35.49	35.30	35.51
Netherlands	EUR	470.68	469.65	471.12	476.88	473.42	478.71	482.51	478.62	484.13
Norway	NOK	1,857.00	1,853.82	1,857.71	1,912.18	1,914.19	1,913.06	1,958.32	1,960.39	1,959.79
Sweden	SEK	3,032.16	3,027.42	3,034.95	3,071.13	3,058.86	3,080.82	3,108.94	3,078.80	3,122.84

Consumption rate private

Billion units		2024			2025			2026
	Cur.	Base	Down	Up	Base	Down	Up	Base	Down	Up
Denmark	DKK	1171.03	1168.55	1172.34	1205.72	1187.38	1211.66	1243.55	1214.54	1249.18
Sweden	SEK	2803.92	2799.99	2807.98	2859.66	2829.32	2881.00	2914.29	2849.79	2943.26

Gross domestic product

Billion units	2024					2025		2026
	Cur.	Base	Down	Up	Base	Down	Up	Base	Down	Up
Bulgaria	BGN	112.95	112.79	113.07	116.35	114.79	116.95	118.95	116.75	119.63
Croatia	EUR	61.31	61.23	61.36	62.52	61.80	62.75	63.34	62.29	63.60
Estonia	EUR	24.55	24.48	24.58	26.29	25.96	26.43	27.64	27.31	27.80
Germany	EUR	3,272.09	3,267.00	3,275.44	3,311.38	3,246.62	3,336.86	3,370.34	3,277.61	3,395.98
Latvia	EUR	28.44	28.30	28.47	30.14	29.74	30.28	31.06	30.69	31.22
Netherlands	EUR	941.44	939.29	942.66	962.43	942.87	969.57	978.98	953.32	986.16
Romania	RON	1,230.18	1,227.14	1,232.08	1,277.98	1,253.92	1,288.45	1,315.20	1,283.16	1,325.50
Slovenia	EUR	50.13	49.94	50.20	51.40	50.74	51.72	52.54	51.88	52.86

13. Financial assets and liabilities classification and fair value

Financial assets

The table below summarises the Group's financial assets presented based on their classification based on their subsequent measurement, at amortised cost or FVPL; and based on their fair value measurement hierarchy, level 1, 2 or 3; as at 30 June 2024 and as at 31 December 2023:

	Fair value	30 June 2024		31 December 2023
EUR '000	hierarchy	Carrying amount	Fair value	Carrying amount	Fair value
FINANCIAL ASSETS AT FVPL
Derivative financial assets	Level 2	58	58	299	299
FINANCIAL ASSETS AT AMORTISED COST
Loans to customers	Level 3	593,701	593,701	575,948	575,948
Cash and cash equivalents		218,996	-	283,712	-
Debt investments	Level 3	103,282	103,282	62,114	62,114
Other financial assets:
- Loans to related parties	Level 3	10,046	10,046	10,048	10,048
- Receivables from banks	Level 3	4,206	4,206	4,362	4,362
- Receivables from sold portfolios	Level 3	1,276	1,276	1,476	1,476
- Other receivables	Level 3	4,950	4,950	3,549	3,549
Total		936,514	717,518	941,508	657,796

The fair value of derivative financial assets is determined using level 2 fair value measurement. The derivative assets include only foreign currency forward contracts where the Group agrees to sell a predetermined amount of its foreign currency exposure at a predetermined price.

Debt investments at 30 June 2024 include investments in secured bonds. The value of this item is determined using level 3 fair value measurement due to the private placement of instruments.

Other financial assets mainly include loans to related parties, receivables from banks and receivables from sold portfolios. Receivables from banks include mandatory deposits held with other banks as a collateral for the purpose of hedging. Loans to related parties comprise the corporate loan to Sortter Oy and loans to members of the Leadership Team. There were no significant changes in the balances with related parties during the reporting period.

The fair values of the other financial assets measured at amortised cost are determined using level 3 fair value measurement based significantly on unobservable inputs. The Group estimates that the carrying amounts of these financial assets reasonably approximate their fair values as it is derived from the purchased price agreed in orderly transactions at 30 June 2024 and 31 December 2023.

Financial liabilities

The table below summarises the Group's financial liabilities presented based on their classification and based on their subsequent measurement, at amortised cost or FVPL; and based on their fair value measurement hierarchy, level 1, 2 or 3; as at 30 June 2024 and as at 31 December 2023:

	Fair value	30 June 2024		31 December 2023
EUR '000	hierarchy	Carrying amount	Fair value	Carrying amount	Fair value
FINANCIAL LIABILITIES AT FVPL
Derivative financial liabilities	Level 2	1,876	1,876	5,323	5,323
FINANCIAL LIABILITIES AT AMORTISED COST
Deposits from customers	Level 3	678,311	678,311	732,350	732,350
Debt securities	Level 1	99,196	101,403	47,805	46,676
Provisions, accruals and other liabilities:	Level 3
- Other financial liabilities		12,566	12,566	9,331	9,331
Lease liabilities		4,104	-	4,963	-
Total		796,053	794,155	799,772	793,680

2024 Multitude Capital Oyj senior unsecured bonds

The Multitude Capital Oyj senior unsecured bonds (ISIN: NO0013259747) were issued on 13 June 2024 with a coupon rate of 3-month Euribor plus 6.75%, maturing in June 2028 (the "2024 MUCA Bonds"). The Group paid EUR 3.2 million of issue costs and discount that are included in interest paid line item of consolidated statement of cash flows. At 30 June 2024, the 2024 MUCA Bonds are presented as debt securities in the Group's consolidated statement of financial position, have outstanding nominal and carrying amounts of EUR 74.1 million and EUR 71.0 million, respectively.

2022 Multitude Bank tranche bonds

The Multitude Bank p.l.c. tranche bonds (series no. 1/2022 - ISIN: MT0000911215) ("2022 FBM tranche bonds") were issued on 13 April 2022 with a coupon rate of 6% maturing on 13 April 2032. Out of the EUR 5.1 million bonds issued, EUR 2.0 million was issued to Multitude SE, which was eliminated at the Group level as part of the consolidation process. At 30 June 2024, the 2022 FBM tranche bonds are presented as debt securities in the Group's consolidated statement of financial position and have outstanding nominal and carrying amounts of EUR 3.1 million and EUR 2.9 million, respectively.

2022 Multitude SE senior unsecured bonds

Multitude SE senior unsecured bonds (ISIN: NO0012702549) were issued on 7 December 2022 with a coupon rate of 7.5% plus 3-month Euribor, maturing in December 2025 (the "2022 MSE Bonds"). At 30 June 2024, the 2022 MSE Bonds are presented as debt securities in the Group's consolidated statement of financial position, have outstanding nominal and carrying amounts of EUR 25.8 million and EUR 25.3 million, respectively. The bonds were partially redeemed with premium in June 2024. As a result of such early redemption, an additional expense of EUR 1.2 million has been recognised in the consolidated statement of profit or loss under the interest expense line item. This encompasses both the amortisation of previously capitalised issuance costs as part of the carrying amount and the call premium. The Group paid EUR 0.7 million of premium that is included in interest paid line item of consolidated statement of cash flows.

Financial liabilities fair value measurements

The fair value of derivative financial liabilities is determined using level 2 fair value measurement. Derivative financial liabilities include only foreign currency forward contracts where the Group agrees to sell a predetermined amount of its foreign currency exposure at a predetermined price.

The fair value of debt securities that includes only listed bonds (2024 Multitude Capital Oyj senior unsecured bonds, 2022 Multitude Bank tranche bonds and 2022 Multitude SE senior unsecured bonds) is determined using level 1 fair value measurement based on the published quotes in the Frankfurt Stock Exchange Open Market, Malta Stocks Exchange, and Frankfurt Stock Exchange Prime Standard, respectively.

The fair value of the remaining financial liabilities measured at amortised cost is determined using level 3 fair value measurement based significantly on unobservable inputs. The Group estimates that the carrying amounts of these financial liabilities reasonably approximate their fair values as it is derived from the purchased price agreed in orderly transactions at 30 June 2024 and 31 December 2023.

14. Dividends

The Group declared a dividend of EUR 0.12 per share in the total amount of EUR 2.6 million for the financial year 2022 that was paid in May 2023. The Board of Multitude SE proposed (and AGM approved) EUR 0.19 per share of dividend distribution in the total amount of EUR 4.1 million in relation to the results of operations for the year ended 31 December 2023 that was paid in May 2024.

15. Correction of a prior period errors and a change of presentation

During the financial year 2023, the Group implemented modifications to its accounting policies pertaining to the presentation of financial statements and rectification of prior period errors. This section shows adjustments in the comparative period of H1 2023. The reasons and impact of change in accounting policies and correction of prior period errors in financial statements are described below.

a) Change in accounting policy - Adoption of new presentation:

In 2023, the Group has undertaken a strategic initiative to enhance the presentation of its financial results, with the aim of providing reliable and more relevant information about the Group's financial position and performance, aligning the presentation of primary statements with the common practice within the financial industry. As a result, the Group, starting with the financial year ended 31 December 2023:

changed the presentation of the statement of financial position from current / non-current classification to presentation based on the order of liquidity;
has restructured the statement of profit or loss to present the net interest income, net fair value and foreign exchange gains and losses and other items;
made corresponding changes in the presentation of the statement of cash flows, to align the presentation with the financial industry and to include the cash flows of operating financial assets and financial liabilities in the cash flows from operating activities in line with IAS 7.

b) Corrections of prior period errors:

1. Inclusion of collection costs in the calculation of expected credit losses

Previously, the Group recognised collection costs as incurred and presented them in general and administrative expense. Debt collection costs are considered incremental and directly attributable to the recovery of cash flows of the granted loans in the event of a default, and as such, they should rather be incorporated into the estimate of the expected credit losses. After the correction, debt collection costs are included in the calculation of expected credit losses by incorporating them in the net expected cash flows of loans to customers to which the collection costs directly relate to.

2. Classification of reminder fees as interest income

The Group has revised its treatment of reminder fees. Historically these fees have been classified as fee and commission income in the statement of profit or loss and accounted for under IFRS 15. Reminder fees are a standard feature of loans to customers and they are collected from the inception of the loan contract over the lifetime of a loan, and similarly to interest. From the financial year ended 31 December 2023 onwards, the Group accounts for these fees in line with IFRS 9, and factors the reminder fees in the calculation of interest income by applying the effective interest method.

3. Scoring costs

Scoring costs consist of credit information, credit rating and similar checks conducted when a customer applies for a loan or product and reaches a certain stage in this process. Historically, scoring costs have been recognised as incurred and presented in general and administrative expense. However, whenever such scoring costs relate to a loan which is granted to the customer, the costs should be treated as a directly attributable transaction cost to such loan, and should be included in the loan balance at inception and in the calculation of the effective interest rate of that loan, thus decreasing the interest income. This restatement only applies to scoring costs related to loans issued. These changes, together with any potential impact in recognised deferred taxes, have been applied consistently, by adjusting the comparative period and the opening balances for the earliest period presented for each affected financial statement line item.

The following tables summarise the impacts on the Group`s condensed interim consolidated financial statements. The tables below show restatement of comparative six-month period ended on 30 June 2023.

Condensed consolidated statement of financial position as at 30 June 2023

EUR '000		Reported 30	Adjustment	Adjustment	Restated 30
Old FSLI	New FSLI	June 2023	amount	number	June 2023
ASSETS	ASSETS
Non-current assets
Deferred tax assets	Deferred tax assets	6,536	394	5	6,930
Loans to customers	Loans to customers	109,750	408,794	1, 6	518,544
Other non-current financial assets	Debt investments	41,809	(3,424)	3, 4	38,385
Investments accounted for using the equity method	Investments accounted for using the equity method	1,012	16	3	1,028
Current assets
Loans to customers	Loans to customers	411,067	(411,067)	1	-
Other current financial assets	Other financial assets	12,029	4,662	2, 4	16,691
Prepaid expenses and other current assets	Prepaid expenses and other assets	4,411	(1,254)	2	3,157
Total assets	Total assets	826,512	(1,879)		824,633
EQUITY	EQUITY
Retained earnings	Retained earnings	78,226	(1,879)	5, 6	76,347
Total equity	Total equity	181,501	(1,879)		179,622
LIABILITIES	LIABILITIES
Non-current liabilities
Deposits from customers	Deposits from customers	149,206	423,922	7, 10	573,128
Lease liabilities	Lease liabilities	3,649	1,916	8	5,565
Current liabilities
Deposits from customers	Deposits from customers	418,214	(418,214)	7	-
Lease liabilities	Lease liabilities	1,916	(1,916)	8	-
Trade payables	Provisions, accruals and other liabilities	6,703	10,250	9, 10	16,953
Accruals and other current liabilities	Provisions, accruals and other liabilities	15,958	(15,958)	9	-
Total liabilities	Total liabilities	645,011	-	-	645,011
Total equity and liabilities	Total equity and liabilities	826,512	(1,879)	-	824,633

Description of adjustments to condensed consolidated statement of financial position as at 30 June 2023

Number	Amount, EUR '000	Description
1	411,067	Current and non-current loans to customers have been merged due to change of the presentation of consolidated statement of financial position based on the order of liquidity.
2	1,254	Part of the prepaid expenses (which in economic terms should be presented as financial assets, such as receivables under the depositor compensation scheme) has been reclassified into other financial assets financial statement line item for a more accurate presentation of information.
3	16	Reclassification of capitalised cost incurred to purchase investment in associate from debt investment in Investment accounted via equity method.
4	3,408	Current portion of debt investments has been reclassified from other financial assets line item to debt investments line item.
5	394	An additional deferred tax asset generated as a result of compliance with IAS 8 has been recognised as result of increased ECL provision.
6	2,273	An additional ECL generated as a result of compliance with IAS 8 has been recognised due to collection costs classification as part of ECL.
7	418,214	Current and non-current deposits from customers have been merged due to change of the presentation of consolidated statement of financial position based on the order of liquidity.
8	1,916	Current and non-current lease liability have been merged due to change of the presentation of consolidated statement of financial position based on the order of liquidity.
9	15,958	Trade payables line item has been merged with accruals and other current liabilities line item and renamed to provisions, accruals and other liabilities.
10	5,708	Interest accrual liability has been reclassified from provisions, accruals and other liabilities to deposit from customers.

EUR '000		Reported	Adjustment	Adjustment	Restated
Old FSLI	New FSLI	Q2 2023	amount	number	Q2 2023
Interest revenue	Interest income	54,785	1,065	2, 6, 7, 9	55,850
Fees	Fee and commission income	721	(715)	6	6
Impairment loss on loans to customers	Impairment loss on loans to customers	(20,380)	(950)	3, 4	(21,330)
Bank and lending costs	General and administrative expense	(2,916)	2,916	1	-
Selling and marketing expense	Selling and marketing expense	(3,735)	(59)	11	(3,794)
General and administrative expense	General and administrative expense	(5,031)	(1,386)	1, 3, 7, 8, 10, 11	(6,417)
Profit before interests and taxes (EBIT)	Profit before interest expense and taxes (EBIT)	11,302	871	-	12,184
Finance income	Interest income	451	(451)	2	-
Finance costs	Interest expense	(5,303)	384	5, 8, 9	(4,919)
Finance costs	Fair value and foreign exchange gains and losses	-	(645)	5	(645)
Profit before income tax	Profit before income tax	6,461	159	-	6,620
Income tax expense	Income tax expense	(1,203)	(102)	10	(1,305)
Profit for the period	Profit for the period	5,258	57	-	5,315

Description of adjustments to condensed consolidated statement of profit or loss for Q2 2023

Number	Amount, EUR '000	Description
1		2,916 Bank and lending costs line item has been merged with general and administrative expenses.
2	451	Finance income in relation to interest from loans to related parties and deposits with other banks has been merged with the interest income financial statement line item.
3	1,007	Invoicing and collection costs have been reclassified from general and administrative expense to impairment loss on loans to customers financial statement line item.
4		57 Impairment loss adjustment due to change in ECL estimate for collection costs.
5	645	A new financial statement line item titled fair value and foreign exchange losses has been separated from interest expense previously reported under finance cost line item.
6		715 Reminder fee has been reclassified from fee and commission income to interest income financial statement line item.
7		118 Scoring costs have been reclassified from general and administrative expense to interest income as part of effective interest income.
8	(244)	Depositor compensation scheme contributions have been reclassified from interest expense to general and administrative expense.
9		17 Finance cost has been renamed to interest expense and reclassified to net interest income.
10		102 Withholding tax on consumer loans has been reclassified from general and administrative expense to income tax expense.
11		59 Bank and lending costs related to loan handling costs have been merged with general and administrative expense.

Condensed consolidated statement of profit or loss for H1 2023

EUR '000		Reported	Adjustment	Adjustment	Restated H1
Old FSLI	New FSLI	H1 2023	amount	number	2023
Interest revenue	Interest income	108,033	2,053	2, 6, 7, 9	110,086
Fees	Fee and commission income	1,495	(1,487)	6	8
Impairment loss on loans to customers	Impairment loss on loans to customers	(40,197)	(2,012)	3, 4	(42,209)
Bank and lending costs	General and administrative expense	(5,960)	5,960	1	-
Selling and marketing expense	Selling and marketing expense	(7,044)	(120)	11	(7,164)
General and administrative expense	General and administrative expense	(11,191)	(4,267)	1, 3, 7, 8, 10, 11	(15,458)
Profit before interests and taxes (EBIT)	Profit before interest expense and taxes (EBIT)	20,909	127	-	21,047
Finance income	Interest income	771	(771)	2	-
Finance costs	Interest expense	(12,346)	3,514	5, 8, 9	(8,832)
Finance costs	Fair value and foreign exchange gains and losses	-	(2,563)	5	(2,563)
Profit before income tax	Profit before income tax	9,346	307	-	9,653
Income tax expense	Income tax expense	(1,865)	(192)	10	(2,057)
Profit for the period	Profit for the period	7,481	115	-	7,596

Description of adjustments to condensed consolidated statement of profit or loss for H1 2023

Number	Amount, EUR '000	Description
1	5,960	Bank and lending costs line item has been merged with general and administrative expenses.
2	771	Finance income in relation to interest from loans to related parties and deposits with other banks has been merged with the interest income financial statement line item.
3	2,127	Invoicing and collection costs have been reclassified from general and administrative expense to impairment loss on loans to customers financial statement line item.
4	115	Impairment loss adjustment due to change in ECL estimate for collection costs.
5	2,563	A new financial statement line item titled fair value and foreign exchange losses has been separated from interest expense previously reported under finance cost line item.
6	1,487	Reminder fee has been reclassified from fee and commission income to interest income financial statement line item.
7	235	Scoring costs have been reclassified from general and administrative expense to interest income as part of effective interest income.
8	981	Depositor compensation scheme contributions have been reclassified from interest expense to general and administrative expense.
9	30	Finance cost has been renamed to interest expense and reclassified to net interest income.
10	192	Withholding tax on consumer loans has been reclassified from general and administrative expense to income tax expense.
11	120	Bank and lending costs related to loan handling costs have been merged with general and administrative expense.

Condensed consolidated statement of cash flows for Q2 2023

EUR '000 Old FSLI	New FSLI	Reported Q2 2023	Adjustment amount	Adjustment number	Restated Q2 2023
Profit for the year	Profit for the period	5,258	57	1	5,315
Adjustments for:	Adjustments for:
Impairments on loans	Impairment loss on loans to customers	20,380	950	1, 2, 4	21,331
Depreciation and amortisation	Depreciation and amortisation	3,755	154	3	3,909
Finance costs, net	Net interest income	5,108	(56,039)	5, 6	(50,931)
Fair value and foreign exchange gains and losses	Fair value and foreign exchange gains and losses	-	645	5, 11	645
Tax on income from operations	Income tax expense	1,203	102	4	1,305
Other adjustments	Other adjustments	316	(154)	3	164
Working capital changes:	Changes in operating assets:
Movements in gross portfolio	Increase (-) in loans to customers	9,291	(39,431)	10, 12, 14, 16, 17	(30,140)
	Increase (-) / Decrease (+) in Other Financial Assets	-	(13,819)	2, 4, 15, 17, 19	(13,817)
	Increase (-) / Decrease (+) in Derivative Financial Instruments (net)	-	(764)	18	(764)
	Increase (-) / Decrease (+) in Other Assets	4,399	1,435	8, 12	5,834
Changes in operating liabilities:	Changes in operating liabilities:
Deposits from customers	Increase (+) in deposits from customers	-	(11,097)	7, 14	(11,097)
Increase (+) / Decrease (-) in trade payables and other liabilities	Increase (+) / decrease (-) in other liabilities	1,051	(1,102)	16, 18	(52)
Interest paid	Interest paid	(1,381)	(1,368)	13	(2,749)
Interest received	Interest received	366	50,896	6, 13, 15	51,261
Income taxes paid	Income taxes paid	(645)	-	-	(645)
Movements in gross portfolio	Increase (-) / decrease (+) in loans to customers	(42,101)	42,101	10	-
Net cash from (used in) operating activities	Net cash from operating activities	7,000	(27,433)	-	(20,432)

EUR '000 Old FSLI	New FSLI	Reported Q2 2023	Adjustment amount	Adjustment number	Restated Q2 2023
Cash flows from investing activities	Cash flows from investing activities
Proceeds from sale of investments and other assets	Increase (-) / decrease (+) in derivative financial instruments (net)	(1,254)	1,254	8	-
Proceeds from sale of investments and other assets	Increase (-) / decrease (+) in derivative financial instruments (net)	(12,800)	12,800	19	-
Purchase of tangible and intangible assets	Purchase of tangible assets	-	388	9	388
Purchase of tangible and intangible assets	Purchase of intangible assets	(2,221)	(388)	9	(2,609)
Net cash used in investing activities	Net cash used in investing activities	(17,291)	14,054	26	(3,237)
Cash flows from financing activities	Cash flows from financing activities
Perpetual bonds interest	Repayment of perpetual bonds interest	(1,480)	-	-	(1,480)
Repayment of finance lease liabilities	Repayment of lease liabilities	(542)	-	-	(542)
Deposits from customers	Increase (+) in deposits from customers	(13,202)	13,202	7	-
Net cash from (used in) financing activities	Net cash from (used in) financing activities	(19,688)	13,202	7	(6,485)
Cash and cash equivalents at beginning of the period	Cash and cash equivalents at beginning of the period	227,171	-	-	227,171
Exchange losses on cash and cash equivalents	Exchange losses on cash and cash equivalents	(485)	177	11	(309)
Net increase in cash and cash equivalents	Net increase/ decrease in cash and cash equivalents	(29,978)	(177)	11	(30,155)
Cash and cash equivalents at the end of the period	Cash and cash equivalents at the end of the period	(30,464)	-	-	(30,464)

Description of adjustments to the consolidated statement of cash flows for Q2 2023

Number	Amount, EUR '000	Description
1		57 Change in accounting treatment of collection costs that led to increase in ECL provision for the loans to customers.
2	1,008	Invoicing and collection cost has been reclassified from general and administrative expense to impairment loss on loans to customers and hence deducted from movement in loans to customers.
3		154 Impairment on non-financial assets has been reclassified from other adjustments line.
4	102	An adjustment has been made regarding the change in accounting treatment of withholding tax on Romanian portfolio leading to reclassification of adjustment from movement in working capital to add back of income tax expense.
5	822	Finance cost, net has been split between net interest income and unrealised items included in fair value and fair values and foreign exchange gain or loss in the statement of profit or loss.
6		55,217 Finance cost, net has been split between net interest income and fair value and foreign exchange gains and losses.
7	(13,202)	Reclassification of movement in deposits from customers to operating cash flow with subsequent renaming of line item.
8	(1,254)	Reclassification of changes in derivative assets and liabilities.
9	(388)	Separation of purchase of tangible assets from purchase of intangible assets.
10		42,101 Reclassification of movement of loans to customers with subsequent renaming of line item.
11		177 Reclassification of part of exchange gains / (losses) on cash and cash equivalents to fair value and foreign exchange gains and losses.
12	(62)	Reclassification of part of accrued gain or loss from derivatives from other assets to movement in derivatives.
13	(1,368)	Adjustment of net interest income with netting of interest received and interest paid line items.
14		2,105 Reclassification of change in prepayment related to issue costs to loans to customers.
15		5,690 Separation of movement on interest accrual from loans to customers.
16		3,666 Netting of other liabilities with other assets to match movement on the statement of financial position.
17		11,129 Reclassification of movements in other liabilities related to unallocated payments to loans to customers to match movement on the statement of financial position.
18	(3,690)	Netting of other liabilities to other financial assets to match movement on the statement of financial position.
19		12,800 Reclassification of debt investment purchase from purchase of non-current financial investments to other financial assets.

Condensed consolidated statement of cash flows for H1 2023

EUR '000 Old FSLI	New FSLI	Reported H1 2023	Adjustment amount	Adjustment number	Restated H1 2023
Profit for the year	Profit for the period	7,481	115	1	7,596
Adjustments for:	Adjustments for:
Impairments on loans	Impairment loss on loans to customers	40,197	2,013	1, 2	42,210
Depreciation and amortisation	Depreciation and amortisation	7,171	419	3	7,590
Finance costs, net	Net interest income	10,613	(111,867)	5, 6	(101,254)
Fair value and foreign exchange gains and losses	Fair value and foreign exchange gains and losses	-	2,563	5, 11	2,563
Tax on income from operations	Income tax expense	1,865	192	4	2,057
Other adjustments	Other adjustments	704	(419)	3	286
Working capital changes:	Changes in operating assets:
Movements in gross portfolio	Increase (-) in loans to customers	9,291	(60,582)	10, 12, 14, 16, 17	(51,291)
	Increase (-) / Decrease (+) in Other Financial Assets	-	(17,279)	2, 4, 15, 17, 19	(17,277)
	Increase (-) / Decrease (+) in Derivative Financial Instruments (net)	-	230	18	230
	Increase (-) / Decrease (+) in Other Assets	-	(198)	8, 12	(198)
Changes in operating liabilities:	Changes in operating liabilities:
Deposits from customers	Increase (+) in deposits from customers	-	69,750	7, 14	69,750
Increase (+) / Decrease (-) in trade payables and other liabilities	Increase (+) / decrease (-) in other liabilities	(2,288)	3,665	16, 18	1,377
Interest paid	Interest paid	(4,004)	(671)	13	(4,675)
Interest received	Interest received	457	99,209	6, 13, 15	99,666
Income taxes paid	Income taxes paid	(486)	-	-	(486)
Movements in gross portfolio	Increase (-) / decrease (+) in loans to customers	(65,323)	65,323	10	-
Net cash from (used in) operating activities	Net cash from operating activities	5,678	52,463	-	58,143

EUR '000 Old FSLI	New FSLI	Reported H1 2023	Adjustment amount	Adjustment number	Restated H1 2023
Cash flows from investing activities	Cash flows from investing activities
Proceeds from sale of investments and other assets	Increase (-) / decrease (+) in derivative financial instruments (net)	(21)	21	8	-
Proceeds from sale of investments and other assets	Increase (-) / decrease (+) in derivative financial instruments (net)	(12,800)	12,800	19	-
Purchase of tangible and intangible assets	Purchase of tangible assets	-	146	9	146
Purchase of tangible and intangible assets	Purchase of intangible assets	(4,863)	(146)	9	(5,009)
Net cash used in investing activities	Net cash used in investing activities	(18,700)	12,821		(5,879)
Cash flows from financing activities	Cash flows from financing activities
Perpetual bonds interest	Repayment of perpetual bonds interest	(2,845)	-		(2,845)
Repayment of finance lease liabilities	Repayment of lease liabilities	(1,104)	(1,104)		-
Deposits from customers	Increase (+) in deposits from customers	66,002	(66,002)	7	-
Net cash from (used in) financing activities	Net cash from (used in) financing activities	57,589	(66,002)	7	(8,413)
Cash and cash equivalents at beginning of the period	Cash and cash equivalents at beginning of the period	153,325	-	-	153,326
Exchange losses on cash and cash equivalents	Exchange losses on cash and cash equivalents	(1,186)	718	11	(469)
Net increase in cash and cash equivalents	Net increase/ decrease in cash and cash equivalents	44,568	(718)	11	43,850
Cash and cash equivalents at the end of the period	Cash and cash equivalents at the end of the period	196,707	-	-	196,707

Description of adjustments to the consolidated statement of cash flows for H1 2023

Number	Amount, EUR '000	Description
1	115	Change in accounting treatment of collection costs that led to increase in ECL provision for the loans to customers.
2	2,128	Invoicing and collection cost has been reclassified from general and administrative expense to impairment loss on loans to customers and hence deducted from movement in loans to customers.
3	419	Impairment on non-financial assets has been reclassified from other adjustments line.
4	192	An adjustment has been made regarding the change in accounting treatment of withholding tax on Romanian portfolio leading to reclassification of adjustment from movement in working capital to add back of income tax expense.
5	3,281	Finance cost, net has been split between net interest income and unrealised items included in fair value and fair values and foreign exchange gain or loss in the statement of profit or loss.
6	108,586	Finance cost, net has been split between net interest income and fair value and foreign exchange gains and losses.
7	66,002	Reclassification of movement in deposits from customers to operating cash flow with subsequent renaming of line item.
8	21	Reclassification of changes in derivative assets and liabilities.
9	146	Separation of purchase of tangible assets from purchase of intangible assets.
10	65,323	Reclassification of movement of loans to customers with subsequent renaming of line item.
11	718	Reclassification of part of exchange gains / (losses) on cash and cash equivalents to fair value and foreign exchange gains and losses.
12	177	Reclassification of part of accrued gain or loss from derivatives from other assets to movement in derivatives.
13	671	Adjustment of net interest income with netting of interest received and interest paid line items.
14	3,748	Reclassification of change in prepayment related to issue costs to loans to customers.
15	10,048	Separation of movement on interest accrual from loans to customers.
16	3,895	Netting of other liabilities with other assets to match movement on the statement of financial position.
17	12,207	Reclassification of movements in other liabilities related to unallocated payments to loans to customers to match movement on the statement of financial position.
18	230	Netting of other liabilities to other financial assets to match movement on the statement of financial position.
19	12,800	Reclassification of debt investment purchase from purchase of non-current financial investments to other financial assets.

17. Events occurring after the reporting period

Redemption of the 2022 Multitude SE senior unsecured bond

As announced on 13 June 2024, Multitude SE has exercised its right to redeem all outstanding senior unsecured floating rate bonds maturing in December 2025 (ISIN NO0012702549) (the "Bonds"), in accordance with Clause 9.3 (Voluntary Total Redemption (call option)) of the terms and conditions of the Bonds.

The redemption date was 8 July 2024. The redemption amount for each Bond was the applicable call option amount (being 103.75% of the nominal amount), plus accrued but unpaid interest, and the redemption amount was paid to the bondholders holding Bonds on the relevant record date (1 July 2024).

The Bonds have been subsequently delisted from the Frankfurt Stock Exchange Open Market (Freiverkehr) and the corporate bond list of Nasdaq Stockholm in connection with the redemption date.

Investor relations contacts

Lasse Mäkelä

Chief Strategy and IR Officer E: [email protected] M: +41 79 371 3417

Bernd Egger

Chief Financial Officer E: [email protected] M: +49 173 7931235

For further information on the Multitude share and all publications, please visit

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Multitude SE

6313_ir_2024-08-22_1e268e95-8b46-4f0d-8767-4952abbc579a.pdf

Contents

Interim Board of Directors' Report H1 2024

Multitude SE in Brief

OUR CURRENT BUSINESS UNITS

Key business highlights

H1 in Brief

KEY HIGHLIGHTS:

Company structure and business model

Multitude growth platform

Business Unit: Consumer Banking - Ferratum

Instalment loans

Micro Loan

Plus Loan

Prime Loan

Revolving loans

Credit Limit

Credit Card

H1 2024 highlights

Outlook

Business Unit: SME Banking - CapitalBox

Instalment Loans

Invoice Purchasing

Credit Line

Secured Loan

Purchase Finance (BNPL)

H1 2024 highlights

Outlook

Business Unit: Wholesale Banking – Multitude Bank

Target customers

Secured Debt

Payment Solutions

H1 2024 highlights

Outlook

Key figures and ratios

Key developments and progress in H1 2024

Financial overview

Statement of profit or loss:

Statement of financial position:

Assets

Liabilities

Equity

Key performance changes in the reporting period

Change in accounting policy and correction of errors

Treasury update

Personnel update

1. Alain Nydegger appointed as Tribe CEO of Wholesale Banking

2. Julie Chatterjee resigns as Chief Commercial Officer

Alternative performance measures

Risk factors and risk management

1.1 Consumer Banking and SME Banking

1.2 Wholesale Banking

Statement pursuant to Capital Markets Rule 5.75.3 issued by the Malta Financial Services Authority

Unaudited condensed interim consolidated financial statements H1 2024

Condensed consolidated statement of profit or loss

Condensed consolidated statement of comprehensive income

Condensed consolidated statement of financial position

Condensed consolidated statement of cash flows

Condensed consolidated statement of changes in equity

Notes to condensed interim consolidated financial statements

1. General information

1.1 Significant changes in the current reporting period

Relocation

Acquisition of Omniveta

New business unit

Placing of EUR 80 million guaranteed unsecured bond

2. Summary of material accounting policies

2.1 Basis of preparation

2.2 Statement of compliance

2.3 Presentation of financial statements

2.4 New standards and amendments

3. Changes in Group companies

4. Segment information

Consumer Banking - Ferratum

SME Banking - CapitalBox

Wholesale Banking – Multitude Bank

Operating and reportable segments for Q2 2024

Operating and reportable segments for H1 2024