Freedom Holding Corp. Reports Board Expansion

New members of the board are expected to improve the company’s governance and risk management

Freedom Holding Corp., a diversified financial services company in Kazakhstan, has expanded its board of directors by welcoming three new members: Dr. Kairat Kelimbetov, former head of the National Bank and ex-minister of economic development and trade; Andrew Gamble, legal adviser; and Philippe Vogeleer, telecommunication consultant.  Jason Kerr, a former member of the Freedom board, has been appointed chief legal officer of the company.

Freedom Holding Corp. has been actively developing its business outside Kazakhstan over the past several years, which acted as the primary driver behind the board expansion. Inviting high-profile professionals from international companies is designed to aid in the expected continuation of the company’s global expansion strategy, the company’s press service said in a statement.

Global expansion

As Freedom continues to diversify its revenue streams in various sectors and countries, the company’s intention to expand its corporate expertise in doing business globally is understandable. As of today, Freedom runs representative offices in 19 countries all over the world.

Freedom Finance Europe, a brokerage company, renders services to tens of thousands of retail investors across Europe. The company has recently reported an increase in new customers and assets on accounts, particularly in Greece and Poland. Freedom Capital Markets, the company’s subsidiary in the U.S., is engaged in underwriting, and providing capital markets advisory services which helps businesses navigate the IPO or capital raising process. Roughly ten companies went public and raised tens of millions of dollars with the help of Freedom. Thanks to these completed offerings, Freedom Capital Markets has managed to gain a foothold in this highly competitive marketplace and lay a foundation for a continued increase in its client base and bigger deals.

Freedom Holding Corp. itself has been a public company since 2019; its shares are traded on Nasdaq under the ticker FRHC. As of early June 2024, the Company’s market cap was about $5 billion. The business activity of Freedom is regulated by the U.S. Securities and Exchange Commission (SEC) and all financial statements by Freedom meet US GAAP standards.  They are audited by one of the biggest international accounting firms, providing for a high level of business transparency and compliance.

Financial universe

The core business of Freedom is currently located in Kazakhstan. According to the financial report for the quarter starting in October 2023 and ending in December 2023, the company’s ecosystem of financial services in Kazakhstan was responsible for $359 million of the $418.6 million of total revenue generated for the quarter. Freedom Bank reported $140.2 million in revenue; Freedom Finance Global (international broker) reported $96 million and the insurance companies Freedom Life and Freedom Insurance reported a combined $94.07 million. The company currently reports more than five million clients from Kazakhstan, CIS member states, and other countries.

In March, Freedom Bank launched its SuperApp, designed to make the ecosystem user experience more convenient. Freedom SuperApp has swiftly become one of the most popular financial apps for mobile devices (iOS and Android) in Kazakhstan. With the help of the App, customers can open a banking deposit account, apply for a mortgage, take out a car loan, and conduct many other transactions.

In May, Freedom’s customers were provided with the unique opportunity to gain ownership of Freedom Holding Corp. stock every time they use their bank card. Every bank card transaction conducted by a customer gives them a cashback bonus nominated in a unique currency called Freedom currency. This currency can be spent on goods and services or transferred to another person via the number of their card or their mobile phone. Within the ecosystem, Freedom customers can enjoy up to 16% in cashback, whereas other companies offer just 3%. The only requirement is to be a client of Freedom Bank, and customers can open a Freedom Bank account from anywhere they have internet access.

The new Freedom currency is linked to the share price of Freedom Holding Corp. which over the past 4.5 years has increased from $12 to $75, more than five times.

According to Timur Turlov, the company’s founder, this program might be expanded outside the ecosystem in order to provide customers with the opportunity to create passive income.

Bet on telecommunications 

Philippe Vogeleer, a telecommunication expert, has joined Freedom’s board of directors for a reason. As the company is actively developing its telecommunication business line, intending to play a significant role in the industry, Vogeleer’s experience is expected to come in handy. Freedom Telecom plans to take the leading position in the sector within several years and to achieve this goal, the company is investing hundreds of millions of dollars in purchasing and deploying telecommunication equipment (base stations and data processing centers), as well as laying fiber optic networks. With this idea in mind, the company successfully placed 12% yield bonds for $200 million, secured by Freedom Holding Corp. itself.

Turlov is convinced that Freedom Telecom is capable of improving the quality of communication in Kazakhstan and accelerating the development of the country’s economy through the digitalization of services in various sectors. All in all, regular citizens of Kazakhstan are those who will benefit from this transformation, the businessman believes.

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