VPC Specialty Lending Investments : Annual Financial Report

27 April 2017

VPC SPECIALTY LENDING INVESTMENTS PLC

(the 'Company' or 'Parent Company' with its subsidiaries (together) the 'Group')

Annual Financial Report for the year ended 31 December 2016

The Board of Directors (the 'Board') of VPC Specialty Lending Investments PLC (ticker: VSL) present the Company's Annual Financial Report for the year ended 31 December 2016.

VPC Specialty Lending Investments PLC is a UK listed investment trust investing in opportunities in the alternative lending market through specialty lending platforms ('Portfolio Companies') globally and other related opportunities. This includes investing in assets originated by Portfolio Companies as well as through floating rate senior secured credit facilities ('Credit Facilities'), equity or other instruments. The Company enables its investors to access an illiquid asset class and earn an attractive risk adjusted return through a diversified, liquid vehicle traded on the Main Market.

The Company's investing activities have been delegated by the Directors to Victory Park Capital Advisors, LLC (the 'Investment Manager' or 'VPC').

1. Based on a share price of 100 pence.

2. Net of issue costs.

3. On 4 March 2016 the Company's 183,000,000 C Shares were converted into 182,615,655 Ordinary Shares.

SUMMARY AND HIGHLIGHTS FOR THE PERIOD

As at 31 December 2016, the Company had deployed 87% of its NAV (with its cash holding of 13% temporarily elevated due to the recent sale of the Funding Circle U.K. portfolio). During 2016, The Company generated an NAV return of 0.85% for the Ordinary Shares and distributed dividends of 6.00 pence per Ordinary Share relating to the income earned during the year ended 31 December 2016.

The financial and business highlights for the year ended 31 December 2016 are as follows:

v January 2016: announced a dividend of 2.00 pence per Ordinary Share for the three-month period to 31 December 2015 and 1.07 pence per C share for the period 2 October 2015 to 31 December 2015.

v February 2016: Upacala Mapatuna joined VPC as Chief Investment Officer.

v February 2016: announced VPC participation in Avant's 2016-A securitisation of $345 million in consumer loans.

v March 2016: C Shares converted to Ordinary Shares at a ratio of 1,000 C shares to 997 Ordinary Shares.

v March 2016: Stifel appointed as joint broker alongside Jefferies.

v April 2016: announced VPC participation in Avant's 2016-B transaction, a securitisation of $345 million in consumer loans.

v May 2016: announced a dividend of 1.50 pence per Ordinary Share for the three-month period to 31 March 2016.

v May 2016: announced initial investment in West Creek Financial, a provider of point of sale lease-to-own financing to underserved customers enabling purchases of durable goods such as furniture, mattresses and appliances.

v June 2016: announced that Richard Levy, CEO of VPC, the Company's Investment Manager, was appointed as a non-executive Director of the Company.

v June 2016: announced initial investment in Fundbox Ltd., a balance sheet Portfolio Company providing short-term working capital advances to SMEs.

v July 2016: VPC announced it will invest 20% of its monthly management fee received from the Company into the shares in the Company at the prevailing market price on an ongoing basis, subject to the shares trading at discount and certain other limitations.

v August 2016: announced a dividend of 1.50 pence per Ordinary Share for the three-month period to 30 June 2016.

v November 2016: announced a dividend of 1.50 pence per share for the three-month period to 30 September 2016.

v December 2016: announced the sale of the Company's portfolio of marketplace loans originated through Funding Circle U.K. which as at the end of October 2016 represented 7.7% of the Company's Net Asset Value.

v December 2016: announced the commencement of a share buyback programme considering the significant disparity between the Company's share price and its NAV (as at the year-end a total of 1.5 million shares had been purchased under the programme at an average price of 77.25 pence).

SUBSEQUENT EVENTS

Since the year ended 31 December 2016:

v In January 2017, the Company made new balance sheet investments into Cognical and Kueski.

v In February 2017, the Company made new balance sheet investments into iZettle.

v The Company has continued the reallocation of capital into balance sheet investments. As at 28 February 2017, balance sheet deals accounted for 63% of NAV versus 51% as at 31 December 2016 and marketplace loans accounted for 23% of NAV versus 26% as at 31 December 2016.

v From 1 January 2017 to 25 April 2017 a total of 2.8 million shares have been repurchased at an average price of 77.18 pence under the buyback programme.

Andrew Adcock, Chairman of VPC Specialty Lending Investments PLC, commented:

During 2016 the Investment Manager reallocated capital from marketplace to balance sheet investments. Balance sheet investments have performed in line with expectations throughout the year and have generated higher returns than marketplace lending to date. Balance sheet lending is secured by the loan book, with the platforms taking the first loss on any defaults by the end borrowers, therefore mitigating credit risk. This reallocation process remains ongoing and will continue in 2017.

The Share price represented a 17.33% discount to the year-end NAV per share and as a direct result of this significant disparity, a share buyback programme was initiated in December 2016. Furthermore, as a sign of support for the stock, the Investment Manager announced that it would use 20% of their management fees to purchase shares in the open market.

I believe that the reallocation of capital from marketplace to balance sheet investments and the share buyback programme are beneficial for future shareholder returns.

FOR FURTHER INFORMATION, PLEASE CONTACT:

ABOUT:

VPC Specialty Lending Investments PLC (the 'Company' or 'VSL', Company No. 9385218) is a U.K. listed investment trust investing in opportunities in the specialty lending market through balance sheet or marketplace lending models ('Portfolio Companies') globally and other related opportunities. This includes investing in assets originated by Portfolio Companies as well as through floating rate senior secured credit facilities ('Credit Facilities'), equity or other instruments.

The Company's investing activities have been delegated by the Directors to Victory Park Capital Advisors, LLC (the 'Investment Manager' or 'VPC'). A summary of the principal terms of their appointment can be found on pages 37 and 38 of the Annual Report and a statement relating to their continuing appointment can be found on pages 33 and 36 of the Annual Report. The investment policy can be found beginning on page 102 of the Annual Report. VPC is an SEC-registered investment adviser headquartered in Chicago that has been actively involved in the specialty lending marketplace since 2010. VPC has made more than $4.6 billion of investments and commitments across various financial technology Portfolio Companies, spanning multiple geographies, products and structures, and is continuing to deploy capital in to existing and new Portfolio Companies.

Further information on VPC Specialty Lending Investments PLC is available athttp://vpcspecialtylending.com.

A copy of the Company's Annual Report will shortly be available to view and download from the Company's website, http://vpcspecialtylending.com. Neither the contents of the Company's website nor the contents of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into or forms part of this announcement.

The following text is extracted from the Annual Report and Financial Statements of the Company for the year ended 31 December 2016.

STRATEGIC REPORT

CHAIRMAN'S STATEMENT

I am pleased to present VPC Specialty Lending Investments PLC's Annual Report, for the year ended 31 December 2016. The total NAV per share return for the Company was 0.85% for the year. The Company declared dividends of 6.00 pence per Ordinary Share relating to the returns of the Company for the year ended 31 December 2016 and delivered a yield of 6.60% in dividends on the average Ordinary Share NAV for the year.

Declared dividends were below the 8.0% targeted at the time of the IPO, with the underperformance being largely attributable to lower-than-expected returns from the Company's marketplace loan investments, due to higher-than-expected loss curves and loan seasoning. By contrast, the Company's balance sheet investments performed in line with expectations throughout the year with low volatility.

During 2016 the Investment Manager reallocated capital from marketplace to balance sheet investments with a substantial amount of progress made during the year. The Company has generated higher returns from balance sheet lending than marketplace lending to date, and balance sheet loans made to our Portfolio Companies including online and non-bank lending platforms are secured by the loan book, with the platforms taking the first loss on any defaults by the end borrowers and the investments benefiting from excess spread. Balance sheet lending therefore represents a better alignment of interest with the Company and mitigates credit risk. This reallocation process remains ongoing and will continue in 2017.

The Company's Ordinary Share price was disappointing in 2016, declining by 16.67% and closing the year at 78.75p, representing a 17.33% discount to the year-end NAV per share. In light of this significant disparity, a share buyback programme was initiated in December 2016. As at 31 December 2016, a total of 1.5 million Ordinary Shares had been repurchased at an average price of 77.25p. Earlier in the year, as a sign of support for the stock, the Investment Manager also announced that it would use 20% of their management fees to purchase shares in the open market.

Although I am disappointed with the overall performance of the Company in 2016, I believe that the reallocation of capital from marketplace to balance sheet investments and the recently commenced share buyback programme are likely to boost future shareholder returns.

4. This return denotes an average return calculated by dividing the dividends paid divided by the average Net Asset Value (Cum Income) of the Company for the period.

INVESTMENTS

The performance of the Company's investment portfolio in 2016 has been polarised. The balance sheet portfolio continued to perform in line with expectations, with average annualised levered returns on allocated equity of 13.87% for 2016. These investments benefit from excess spread and first loss protection, which provides additional downside protection compared to marketplace loans. The credit metrics on the underlying loans remain strong and I believe that the portfolio will continue to generate attractive risk-adjusted returns with low volatility. Furthermore, the pipeline of available investment opportunities remains strong.

By contrast, returns from the marketplace loan portfolio have remained subdued due to higher-than-projected loss curves in certain of the loan portfolios and the adverse seasoning effect as the loan portfolio matures without subsequent purchases. These issues for the marketplace portfolio have been magnified by the reduction in new investments and the consequential faster seasoning of the overall marketplace loan portfolio.

The Avant securitisation residuals, which are held at fair value, have been a key aspect of weak capital returns due to a moderate increase in the underlying loss curve projections compounded by significant gearing. The Company's exposure to these residuals has continued to shrink and was 5.2% of NAV as at 31 December 2016.

Over the course of 2016, capital has been steadily reallocated from marketplace investments into balance sheet investments which have consistently delivered higher returns with lower volatility. During the year, the percentage of NAV invested in balance sheet deals increased from 22% to 51%, while over the same period capital invested in marketplace investments decreased from 58% to 26%. This capital reallocation process will take time to complete organically as the marketplace portfolio had a remaining weighted average life of 18 months at year end (excluding prepayments). On the redeployment side, the Company enjoys a large pipeline of attractive balance sheet opportunities to utilise capital as it becomes available for investment. The Investment Manager continues to closely monitor the portion of the marketplace portfolio that is challenged, including exploring ways to tactically further reduce exposure.

5. This return denotes an average return calculated by dividing the income earned on the balance sheet investments for the period by the average capital invested in balance sheet loans each month in the period. This return includes limited gearing on the balance sheet portfolio.

COSTS

The Company's annualised ratio of ongoing charges for the calendar year 2016 stands at 1.30% (down from 1.63% in 2015) which comprises of management fees and advisory, legal, professional and other operating costs of the Company. Expenses incurred at any investment fund or special purpose vehicle that the Company invests are excluded from the ongoing charges calculation of the Company.

MARKET OUTLOOK

As 2016 ended, investor sentiment towards online lending was improving after some volatility earlier in the year. In the second quarter, U.S. online lending volumes slowed sharply as Lending Club experienced some data quality and corporate governance issues. Once these issues were resolved, quarterly volumes stabilised and returned to sequential growth in the fourth quarter. In the U.K., online lending volumes grew by 32% year-on-year in 2016. This growth was heavily weighted towards the second half of the year once it became apparent that the economy was performing well despite the Brexit outcome. Accordingly, in the last quarter of 2016, origination volumes were growing sequentially in both the U.S. and U.K.

The political and macroeconomic outlook appears generally positive under the new administration in the U.S. Expected further increases in the Federal Funds rate will translate relatively quickly into higher income for the Company due to the floating rate balance sheet investments and the short duration of the marketplace loan assets. As interest rates rise, the Company's increased allocation to balance sheet deals with first loss protection and significant excess spread provides insulation from any potential deterioration in currently benign credit conditions.

The Company has also considered Brexit's current and potential impact on the Company. The majority of the Group's portfolio is denominated in U.S. Dollars and the Company has entered into derivative contracts to manage the exposure to foreign currency on existing assets.

The long term structural growth drivers for online lending remain as strong as ever. Specifically, the regulatory changes implemented following the financial crisis have resulted in banks being unable to cost-effectively serve many credit-worthy consumers and SMEs ('small and medium enterprises'). In addition, the availability of credit information outside banks continues to improve and, through automation, online lenders can profitably lend to these under-served SMEs and consumers. Without legacy systems to maintain, online lenders can innovate to provide a better user experience to borrowers. These growth drivers are likely to sustain the growth and development of the online lending sector for many years to come, and the Company is well positioned to capture the resulting income opportunity due to its Investment Manager's experience and technical expertise.

6. Based on origination value data for Lending Club, Prosper and OnDeck, which we have used as a proxy for the overall U.S. Online Lending sector given limited publicly available data.

7. Using P2PFA published volumes as a proxy for the overall Online Lending sector.

Andrew Adcock

Chairman

27 April 2017

INVESTMENT OBJECTIVES

The Company's investment objectives are to:

(i) generate an attractive total return for shareholders consisting of distributable income and capital growth through investments in specialty lending opportunities;

(ii) achieve portfolio diversification across Portfolio Companies, geographies, borrower types, credit quality, loan structures and investment models; and

(iii) enable our shareholders to benefit from equity upside through exposure to equity or equity-linked securities issued by Platforms.

The Company's Net Asset Value (the 'NAV') as at 31 December 2016 was £363.1 million (cum income).

TOP TEN POSITIONS

The table below provides a summary of all positions held by the Company equal to or greater than 1% of NAV, excluding equity exposure as at 31 December 2016. The summary includes a look-through of the Company's investment in VPC Offshore Unleveraged Private Debt Fund Feeder, L.P. There has been a deliberate and significant shift to balance sheet assets throughout 2016. At the end of 2015, the top five investments were all marketplace loans, while at the end of 2016, four out of the five top investments were balance sheet investments.

The table below shows all positions held by the Company equal to or greater than 1% of NAV, excluding equity exposure as at 31 December 2015. The summary includes a look-through of the Company's investment in VPC Offshore Unleveraged Private Debt Fund Feeder, L.P.

INVESTMENT MANAGER'S REPORT

SUMMARY

Although we are encouraged with the progress that the Company has made in adding a greater percentage of balance sheet loans at the expense of marketplace loans, we are disappointed with the overall performance of the Company in 2016 and continue to look at ways to improve performance.

In 2016 the Company converted the C Share capital into Ordinary Shares, participated in two securitisations of its Avant marketplace loans and entered into eight new Portfolio Company investments of which seven were balance sheet arrangements. The performance of the Company's balance sheet investments was in line with expectations however returns from the marketplace investments were below expectations in 2016. Over the course of the year, the Company has steadily increased its percentage of NAV allocated to balance sheet investments. On 22 December 2016, the Company announced a buyback programme considering the significant disparity between the Company's Ordinary Share price and its NAV. In addition, we have also purchased shares using 20% of our monthly management fees paid by the Company to continue to demonstrate our support and belief in the investment objectives.

COMPANY PERFORMANCE

During the year, the Company generated an NAV return of 0.85% for the Ordinary Shares and declared dividends relating to the period totalled 6.00 pence per Ordinary Share (up from 4.79 pence per Ordinary Share in 2015). The NAV per share (Cum Income) at year end 2016 was 95.26p.

The Company generated gross revenue returns of 7.90% as a percentage of NAV in 2016, of which 5.19% was derived from balance sheet investments and 2.71% from marketplace investments. Expenses were -1.90% for a net revenue return of 6.00%. Capital returns contributed -5.15%, comprised of -2.79% from marketplace investments, -3.17% from securitisation residuals, 0.94% from equity investments and -0.13% from other capital returns, for a net total return of 0.85%. The capital losses were largely attributable to both Avant securitisation residuals and various marketplace loan portfolios.

Depreciation and elevated volatility in the GBP exchange rate throughout 2016, particularly in the second and third quarters, increased the cash drag associated with the Company's currency hedging strategy as more cash margin was required by hedging counterparties and it also became necessary to hold more cash on hand for potential margin calls due to GBP devaluation. This issue abated somewhat in the fourth quarter.

INVESTMENTS

The Company invests directly and/or indirectly into available opportunities, including by making investments in funds managed by the Investment Manager. Direct investments include consumer loans, SME loans and advances against corporate trade receivables originated by Portfolio Companies ('Debt Instruments'). Indirect investments include investments in Portfolio Companies (or in structures set up by Portfolio Companies) through the provision of credit facilities ('Credit Facilities'), equity or other instruments.

We allocate capital across different Portfolio Companies to meet the Company's investment objectives within the pre-defined portfolio limits and with a focus on portfolio level diversification. As at 31 December 2016, the Company's investments were diversified across hundreds of thousands of consumer and small business loans originated by 23 different Portfolio Companies, including companies supporting the specialty lending market across the U.S., U.K., Europe and Australia. Capital was provided to 17 Portfolio Companies via balance sheet investments. As part of its investment portfolio, the Company also had exposure to 18 Portfolio Companies through equity securities or convertible notes as at 31 December 2016.

We continue to implement our strategy of deploying capital across a broad range of Portfolio Companies with diversity of geographies, borrower types and credit quality. As at 31 December 2016, consumer exposure accounted for 75% of the investment portfolio, while SME exposure accounted for 25%. Investments in U.S. Portfolio Companies accounted for 78% of the investment portfolio, with U.K. Portfolio Companies accounting for a further 10% of the portfolio.

During 2016, the Company's portfolio of balance sheet investments continued to generate income in line with expectations. These investments benefit from first loss protection and excess spread, which provides downside protection versus marketplace loans. The credit metrics on the underlying loans have shown no signs of stress and we believe that the portfolio will continue to generate attractive risk-adjusted returns with low volatility. Furthermore, the pipeline of available balance sheet investment opportunities remains strong. By contrast the returns from the company's portfolio of marketplace loans have been more subdued and volatile, reflecting Portfolio Company-specific credit issues and the impact of normal loan seasoning.

During 2016, we have steadily reallocated capital from marketplace to balance sheet investments. The returns on NAV from these balance sheet investments have been higher and more stable/predictable than from marketplace loans in every calendar month of 2016, averaging levered revenue returns of 13.87% annualised, versus 4.17% for marketplace investments. We believe that, over time, this ongoing reallocation will help boost overall returns.

5. This return denotes an average return calculated by dividing the income earned on the balance sheet investments for the period by the average capital invested in balance sheet loans each month in the period. This return includes limited gearing on the balance sheet portfolio.

PORTFOLIO COMPOSITION AS AT 31 DECEMBER 2016

8. Percentages calculated on a look-through basis to the Company's investee entities and SPVs.

9. Calculations using gross asset exposure and not reduced for gearing. Excludes cash.

GEARING

At the beginning of 2016, the Company had a Debt/Equity gearing ratio of 0.44x. This gradually increased over the course of the year peaking at 0.92x in August before declining to 0.63x by the year end. The Company's balance sheet investments are on average less geared than its marketplace investments, with 0.2x and 1.4x gearing respectively, as at 31 December 2016. Therefore, the reallocation of capital into balance sheet investments over the course of the year has tended to lower the Company's overall gearing.

The Company continues to explore sourcing a corporate gearing facility which would provide more flexibility with respect to leverage and reduce the potential cash drag impact associated with the Company's currency hedging.

MARKET UPDATE

AVAILABILITY OF CREDIT

Since the 2008 recession, the supply of credit to many SMEs and non-prime consumer borrowers has remained constrained. An estimated 51.1% of consumers in the U.S. have non-prime credit scores (defined as FICO scores below 720) leaving them without access to financing at prime rates. As a result, there is a large and growing population of U.S. consumers with reduced access to traditional consumer credit; the 2016 FDIC survey showed that approximately 66.7 million adults, lived in unbanked and underbanked households in the U.S.

Lending to SMEs has declined significantly over the past decade with the share of small business loans at banks in the U.S. declining from 20% in June 2004 to 12% by December 2016 (defined as loans below $250,000). The landscape is similar in the U.K., with total outstanding borrowing facilities from banks to SMEs reduced from £103.7 billion at the end of 2011 to £94.8 billion as of December 2016.

The performance of some of the Company's marketplace investments has been disappointing due to Portfolio Company-specific credit underwriting issues, related to nascent/ evolving underwriting procedures. However, overall macro-economic conditions in the U.S. and U.K. have been favourable for credit quality, with low unemployment and positive economic growth.

At a macro level, credit assets have generally performed strongly as might be expected given the favourable underlying economic conditions. By way of illustration, credit card charge-offs are below their long term historical averages in both the U.S. and U.K.

The credit performance of the loans financed by the Company's balance sheet positions has been consistent with this generally benign credit environment.

11. Source: Corporation for Enterprise Development - Assets and Opportunity Scorecard (January 2016).

12. Source: 2015 FDIC National Survey of Unbanked and Underbanked Households (October 2016).

13. Source: FDIC Quarterly Banking Profile (September 2016).

14. Source: British Bankers Association: SME Statistics (December 2016).

VOLUME GROWTH

Based on publicly available data, online lending volumes appear to remain on a growth trend despite some short-term volatility. In the U.S., 2016 volume growth was negatively impacted in the second quarter by corporate governance issues at Lending Club although sequential growth resumed in the final quarter of 2016. In the U.K. growth of online lending volumes also slowed in the second quarter of 2016. This was likely due to temporary negative sentiment related to 'read-across' from Lending Club but also due to macro-economic concerns ahead of the Brexit vote. U.K. volumes recovered strongly in the fourth quarter of 2016 resulting in year on year growth in 2016 of 32%.

DEVELOPMENTS IN SECURITISATION MARKET

Securitisation issuance for online lending grew strongly in 2016 with improving pricing, indicating increasing institutional appetite for credit assets with first loss protection, backed by loans originated online.

RETURNS FROM BALANCE SHEET LENDING VERSUS MARKETPLACE LENDING

Balance sheet lending offers significantly higher and more stable/predictable returns than marketplace lending as evidenced by the returns the Company has been able to achieve from balance sheet lending investments which have averaged 13.87% in 2016 (albeit with the benefit of modest gearing). This compares with the 5.2% that was available from marketplace lending per the Liberum Altfi Data Marketplace Lending Returns Index (unlevered return). While this is not a perfect comparison, it serves to illustrate the significantly higher returns available from balance sheet lending which also benefit from significant first loss protection and better alignment of interest with the underlying Portfolio Companies. Further, the Company has not had any defaults on any of its Balance Sheet investments.

5. This return denotes an average return calculated by dividing the income earned on the balance sheet investments for the period by the average capital invested in balance sheet loans each month in the period. This return includes limited gearing on the balance sheet portfolio.

VSL CURRENT YIELD VERSUS HIGH YIELD BONDS

The Company's twelve month trailing current dividend yield was 8.7% at the end of 2016 which compared favourably with returns available elsewhere in the fixed income market such as the European High Yield Index, which yielded 3.0% after significant yield compression during 2016.

24. This return denotes an average return calculated by dividing the dividends paid during the trailing twelve months as at 30 December 2016 divided by the share price at 30 December 2016

OUTLOOK

Despite continued growth, the online lending sector is still only a small part of the global Consumer and SME credit market, leaving scope for significant future market share gains.

Gross volumes for online lenders in 2015 were only 2% of the outstanding loans below $250,000 to U.S. SMEs at the end of the year. However, a surprisingly high proportion, 16%, of small businesses in the U.S. that are seeking a loan are planning to use an online lender compared to the 58% planning to use a bank. These relative percentages are consistent with online lending continuing to grow for many years to come.

27. Source: 'The State of Small Business Lending: Innovation and Technology and the Implications for Regulation,' Harvard Business School and Javelin Advisory Services, 2016. Small businesses were defined as those with turnover below $10.0 million.

REGULATORY ENVIRONMENT

The regulatory environment in the U.S. and U.K. appears to become more favourable to specialty lending. Following President Trump's election victory, the share prices of many of the listed bell-weather stocks in the specialty lending sector rallied by more than 30% on average.

U.S. banking regulators are increasingly viewing financial technology (or 'fintech') companies and online lenders as part of the mainstream financial system. In December 2016, the OCC announced plans to explore providing National Bank Charters to fintech companies, on the basis that these companies are increasing financial inclusion, reaching underserved populations and also making products better suited to the needs of consumers. This type of support from regulators is likely to improve investor confidence in the fintech sector and to help sustain its development in the years ahead.

Similarly, in the U.K., regulators have clearly acknowledged the important role played by fintech and online lenders - providing much needed lending to SMEs as banks have continued to retreat from SME lending due to regulatory challenges - and have taken steps to make sure that it is both encouraged and regulated appropriately. The Governor of the Bank of England (and head of the Financial Stability Board), Mark Carney, in January 2017 stated that fintech had already generated significant increases in financial inclusion and had the clear potential to make the financial system more efficient, effective and resilient. The U.K. Government, has introduced the Innovative Finance ISA ('IFISA'), a tax efficient way for individuals to invest through online P2P lenders and the Financial Conduct Authority ('FCA') has fully authorised over 20 online lending Portfolio Companies making them eligible to provide IFISA products as at 28 February 2017. On 1 November 2016, the U.K. government launched a new mandatory bank referral scheme to make it easier for U.K. firms to access alternative finance. This scheme requires U.K. banks to refer their rejected SME loan applicants to alternative finance providers via online brokers such as Funding Options. This broad support from the U.K. government is likely to facilitate future growth for online lenders.

IMPACT ON THE COMPANY OF RISING RATES

The Company's portfolio is well positioned for a rising rate environment. The U.S. Federal Reserve raised rates by 25bps in both December 2016 and March 2017and is expected to raise rates further over the next couple of years. As at 31 December 2016, 51% of NAV was allocated to balance sheet investments which typically generate floating rate income. The marketplace loan portfolio, which accounts for 31% of NAV (including securitisation residuals), has a remaining weighted average life of only 18 months enabling capital to be reinvested at higher rates relatively quickly. With respect to credit risk, the Company's increasing allocation to balance sheet deals with first loss protection and significant excess spread provides insulation from any potential deterioration in, currently benign, credit conditions as interest rates rise. In many instances the Company benefits from a guarantee from the Portfolio Company lender's operating company, adding a further degree of protection.

PIPELINE AND EXECUTION

In 2016, we, VPC, the Investment Manager, reviewed more than 700 new opportunities and invested over $1.2 billion in loans for all of our funds (of which the Company is one) in the specialty lending sector and we continue to see a strong pipeline of high quality balance sheet investment opportunities within the sector. With capacity available from both existing and new Portfolio Companies we will continue to pursue opportunities that can generate an attractive risk-adjusted return for shareholders and offer further diversification to the portfolio. In addition, we continue to expand our team, now comprised of 45 investment and operational professionals, ensuring best in class experience and technical expertise to maximise these opportunities.

Victory Park Capital Advisors, LLC

Investment Manager

27 April 2017

STRATEGY AND BUSINESS MODEL

EARLY ADOPTER ADVANTAGE

Although specialty lenders have operated successfully for decades, thesectorhasgrownin prominence in the past few years, attracting interest from institutional investors. This has been due to a confluence of regulatory challenges for banks, increased use of technology by Portfolio Companies and a low interest rate environment. The Investment Manager has been an active investor in the sector since 2010 and has made more than $4.6 billion of investments and commitments across various Portfolio Companies, spanning multiple geographies, products and structures, and is continuing to deploy capital into existing and new Portfolio Companies.

The Investment Manager has experience in direct lending, purchasing marketplace loans and selectively investing in equity or equity-like instruments as well as having extensive knowledge of market participants and the complex regulatory requirements needed to operate within the sector. Having access to other significant pools of capital dedicated to investing in the specialty lending sector enables the Investment Manager to obtain gearing facilities on attractive terms. These are significant advantages for the Company as it navigates through a rapidly developing sector and it is well positioned to capture new opportunities.

DIFFERENTIATED PROPOSITION

To date, the Investment Manager has operated its business using two primary structures for providing debt capital to Portfolio Companies, known as the 'Balance Sheet Model' and the 'Marketplace Model' (see descriptions below). While to date, the Investment Manager has utilised both models to achieve the investment objectives of the Company, the performance from the balance sheet investments has been stronger; generating higher returns with less volatility. Therefore, since early in 2016, capital has been gradually re-allocated into balance sheet deals.

Under the Balance Sheet Model the Company provides a floating rate Credit Facility to the Portfolio Company via a Special-Purpose Vehicle ('SPV'), which retains Debt Instruments that are originated by the Portfolio Company. The debt financing is typically arranged in the form of a senior secured facility and the Portfolio Company injects junior capital in the SPV, which provides significant first loss protection to the Company and excess spread, which provides downside protection versus marketplace loans.

In the Marketplace Model, an SPV is formed by the Company to purchase Debt Instruments originated by the Portfolio Company. The Company funds the SPV with equity capital and typically uses a gearing facility from a global bank to enhance the risk-adjusted return for shareholders. All interest payments are for the account of the SPV and the SPV bears the loss for any defaulted loans. For completeness, we describe this structure below. However, we anticipate limited capital allocation to this strategy in 2017.

PROPRIETARY SOURCING AND STRUCTURING

The Company has exposure to several proprietary investments in Portfolio Companies with attractive risk/reward characteristics that other investors in the sector are typically unable to access. This is due to the Investment Manager's long experience in the sector as an early participant with an extensive sourcing network, having executed transactions partnering with more than 35 leading financial and venture capital sponsors in the specialty lending sector.

The Investment Manager also leverages its relationships with Portfolio Companies and financial sponsors to secure significant lending capacity and negotiate attractive equity kickers as well as mitigate prepayment and interest rate risks. The rapid growth of capital deployed in this sector since 2010 has also generated positive network effects and helps ensure the Investment Manager sees the best new developing opportunities in the sector.

PORTFOLIO MANAGEMENT

With a strong focus on capital preservation, the Investment Manager structures its investments to minimise risk for the Company and augments this with a comprehensive risk management framework. This involves a rigorous, hands-on approach to post-investment monitoring of portfolio risk and performance. Assessing the balance of expected returns with inherent risks is an integral part of the Investment Manager's investment strategy and drives all aspects of portfolio construction. The Company believes that this approach and focus are a key driver in meeting its investment objectives, particularly in a potentially more challenging future credit environment.

GEARING AND CAPITAL MARKETS

The Company selectively employs gearing to enhance returns generated by the underlying credit assets. This is structured to limit the borrowings to individual SPVs that hold the assets and the gearing providers have no recourse to the Company. Historically, the Companyhas usedthe securitisation market to lowerits cost of financing.

As the online lending industry continues to grow and become more established, the Investment Manager has been approached by multiple large global banks to offer the Company attractive gearing facilities. Given the breadth of the Investment Manager's portfolio, the Company believes that it has a distinct competitive advantage in securing these gearing facilities at attractive rates.

PERFORMANCE MANAGEMENT

The Board uses the following KPIs to help assess progress against the Company's objectives. Further comments on these KPIs are contained in the Chairman's Statement and Investment Manager's Report sections of the Strategic Report respectively.

NAV AND TOTAL RETURN

The Directors regard the Company's NAV return as a key component to delivering value to shareholders over the long term. Furthermore, the Board believes that in accordance with the Company's objective, total return (which includes dividends) is the best measure for long term shareholder value.

At each meeting, the Board receives reports detailing the Company's NAV and total return performance, portfolio composition and related analyses. A full description of performance and the investments is contained in the Investment Manager's Report, commencing on page 9 of the Annual Report.

DIVIDEND YIELD

The Company intends to distribute at least 85% of its distributable income earned in each financial year by way of dividends. Including the distribution made in March 2017, which related to the three-month period ended 31 December 2016, the Company has distributed 100% of its distributable income earned through the period ended 31 December 2016.

GEARING RATIO

As at 31 December 2016, the look-through gearing ratio was 0.63x for the Company. As disclosed in the investment policy starting on page 99 of the Annual Report, the aggregate gearing of the Company and any investee entity (on a look-through basis, including borrowing through securitisation using SPVs) shall not exceed 1.5 times its NAV. The Investment Manager monitors the look-through gearing ratio to ensure it is in line with the investment policy.

SHARE PRICE PREMIUM/DISCOUNT

As a closed-ended listed investment trust, the Company's share price can and does deviate from its NAV. This results in either a premium or a discount, which is another component of the long term shareholder return. The Board continually monitors the Company's premium or discount and has the ability to issue or buy back shares with a view to limiting the volatility of the share price discount or premium. For more information on the Company's authorities in relation to its share capital, see page 27 of the Annual Report.

During the trading period, the Ordinary Shares moved in a range of -3.8% to -28.2% discount. In December 2016, the Company commenced a buyback programme, in light of the significant disparity between the Company's share price and its NAV. During 2016 a total of 1.5 million shares were bought back at an average price of 77.25p.

EXPENSES

The Board is conscious of the impact of expenses on returns and seeks to minimise expenses while ensuring that the Company receives strong service. The industry-wide measure for investment trusts is the ongoing charges ratio, which seeks to quantify the ongoing costs of running the Company. The ongoing charges ratio for 2016 was 1.30%, down from 1.63% in 2015. Expenses incurred at any investment fund or SPV that the Company invests are excluded from the ongoing charges calculation of the Company. This measures the annual normal ongoing costs of an investment trust, excluding performance fees, one-off expenses and dealing costs, as a percentage of the average shareholders' funds.

PRINCIPAL RISKS

Given that the Company operates globally, it is exposed to risks that are monitored and actively managed to meet its investment objectives. These include market risks related to interest rates, currencies and general availability of financing as well as credit and liquidity risks given the nature of the instruments in which the Company invests. In addition, the underlying Portfolio Companies are exposed to operational and regulatory risks as the specialty lending sector remains relatively nascent.

The Directors are ultimately responsible for identifying and controlling risks. Day-to-day management of the risks arising from the financial instruments held by the Group has been delegated to the Investment Manager of the Company.

The Investment Manager regularly reviews the investment portfolio and industry developments to ensure that any events which impact the Group are identified and considered. This also ensures that any risks affecting the investment portfolio are identified and mitigated to the fullest extent possible.

The Board is responsible for the Company's system of risk management and internal control and for reviewing its effectiveness. The Board has adopted a detailed matrix of principal risks affecting the Company's business as an investment trust and has established associated policies and processes designed to manage and, where possible, mitigate those risks, which are monitored by the Audit and Valuation Committee on an ongoing basis.

This system assists the Board in determining the nature and extent of the risks it is willing to take in achieving its strategic objectives. Both the principal risks and the monitoring system are subject to a robust review at least annually. The last review by the Board took place in April 2017.

Although the Board believes that it has a robust framework of internal control in place this can provide only reasonable, and not absolute, assurance against material financial misstatement or loss and is designed to manage, not eliminate, risk.

A summary of the principal risks and uncertainties faced by the Company which have remained unchanged throughout the year, and actions taken by the Board and, where appropriate, its Committees, to manage and mitigate these risks and uncertainties, is set out below:

CREDIT RISK

Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation.

The Company's credit risks arise principally through exposures to loans acquired by the Group, which are subject to risk of borrower default. The ability of the Company to earn revenue is completely dependent upon payments being made by the borrower of the loan acquired by the Company through a Portfolio Company. The Company (as a lender member) will receive payments under any loans it acquires through a Portfolio Company only if the corresponding borrower through that Portfolio Company (borrower member) makes payments on the loan.

Consumer loans are unsecured obligations of borrower members. They are not secured by any collateral, not guaranteed or insured by any third party and not backed by any governmental authority in any way. The Portfolio Companies and their designated third party collection agencies may be limited in their ability to collect on loans.

Small business loans are typically secured by either a blanket lien on business assets, specific collateral and/or a personal guarantee from the proprietor. The Portfolio Companies and their designated third party collection agencies have various channels of recourse against the relevant collateral which will depend on the specific circumstance of the loan.

MITIGATION

There is inherent credit risk in the Company's investments in credit assets through the two primary structures. However, this is typically mitigated by the significant first loss protection provided by the Portfolio Company under the Balance Sheet Model and the excess spread generated by the underlying assets under both models.

The Company will invest across various Portfolio Companies, asset classes, geographies (primarily the U.S. and Europe) and credit bands in order to ensure diversification and to seek to mitigate concentration risks.

The Board and the Investment Manager review the investment portfolio to ensure it is in line with the investment policy, including restrictions, as outlined on pages 99 and 100. The Investment Manger monitors performance and underwriting on an ongoing basis.

FINANCING RISK

The Company uses gearing to enhance returns generated by the underlying credit assets and is exposed to the availability of financing at acceptable terms as well as interest rate expenses and other related costs.

MITIGATION

This risk is mitigated by limiting borrowings to ring-fenced SPVs without recourse to the Company and employing gearing in a disciplined manner.

The Board and the Investment Manager review the investment portfolio to ensure it is in line with the investment policy, including restrictions, as outlined on pages 102 and 103 of the Annual Report.

LIQUIDTY RISK

Liquidity risk is defined as the risk that the Company may not be able to settle or meet its obligations on time or at a reasonable price.

The Company may invest in the listed or unlisted equity of any Portfolio Company. Investments in unlisted equity, by their nature, involve a higher degree of valuation and performance uncertainties and liquidity risks than investments in listed securities and therefore may be more difficult to realise.

In the event of adverse economic conditions in which it would be preferable for the Company to sell certain of its assets, the Company may not be able to sell a sufficient proportion of its portfolio as a result of liquidity constraints. In such circumstances, the overall returns to the Company from its investments may be adversely affected.

The Group is also exposed to liquidity risk with respect to the requirement to pay margin cash to collateralise forward foreign exchange contracts used for currency hedging purposes.

MITIGATION

The Investment Manager manages the Group's liquidity risk by investing primarily in a diverse portfolio of assets. At 31 December 2016, 2% of the loans have a stated maturity date of less than a year. The Group has no loans with a maturity date of more than five years.

In general, the weighted average maturity profile of the Company's assets is lower than or equal to the term of the Company's corresponding debt facilities which reduces liquidity risk.

The Board and the Investment Manager review the investment portfolio to ensure it is in line with the investment policy, including restrictions, as outlined on pages 99 and 100 of the Annual Report. The Board reviews cash flow forecasts to insure the group can meet its liabilities as they fall due.

The Company continuously monitors for fluctuations in currency rates. The Company performs stress tests and liquidity projections to determine how much cash should be held back to meet potential future to obligations to settle margin calls arising from foreign exchange hedging.

MARKET RISK

Market risk is the risk of loss arising from movements in observable market variables such as foreign exchange rates, equity prices and interest rates. The Group is exposed to market risk primarily through its Financial Instruments.

The Group is exposed to price risk arising from the investments held by the Group for which prices in the future are uncertain. The investments in funds are exposed to market price risk. Refer to Note 3 for further details on the sensitivity of the Group's Level 3 investments to price risk.

Interest rate risk arises from the possibility that changes in interest rates will affect future cash flows or the fair values of financial instruments.

Currency risk is the risk that the value of net assets will fluctuate due to changes in foreign exchange rates. Relevant risk variables are generally movements in the exchange rates of non-functional currencies in which the Group holds financial assets and liabilities.

MITIGATION

The Company has a diversified investment portfolio which significantly reduces the exposure to individual asset price risk. Detailed portfolio valuations and exposure analysis are prepared monthly and form the basis for the ongoing risk management and investment decisions. In addition, regular scenario analysis is undertaken to assess likely downside risks and sensitivity to broad market changes, as well as assessing the underlying correlations amongst the separate asset classes.

Exposure to interest risk is limited as the underlying credit assets are typically fully amortising with a maximum maturity of five years. Furthermore, the Company's Credit Facilities charge a floating interest rate to the Portfolio Companies.

The Company mitigates its exposure to currency risk by hedging exposure between Pound Sterling and any other currencies in which a significant portion of Company's assets may be denominated.

The Board reviews the price, interest and currency risk with the Investment Manager to ensure that exposure to these risks are appropriately mitigated.

PORTFOLIO COMPANY RISK

The current market in which the Company participates is competitive and rapidly changing. There is a risk that the Company will not be able to deploy its capital, re-invest capital and interest of the proceeds of any future capital raisings in a timely or efficient manner given the increased demand for suitable investments.

The Company may face increasing competition for access to investments as the alternative finance industry continues to evolve. The Company may face competition from other institutional lenders such as fund vehicles and commercial banks that are substantially larger and have considerably greater financial, technical and marketing resources than the Company. Other institutional sources of capital may enter the market in both the U.K., U.S. and other geographies.

MITIGATION

VPC has negotiated a significant number of proprietary capital deployment agreements with its existing balance sheet partners each of which typically ensures the ability to deploy capital on attractive terms for several years.

In addition, VPC is one of the largest investors in the specialty lending sector and therefore enjoys timely information and good access to emerging Portfolio Company opportunities. VPC has a team of 45 investment and operational professionals which ensures that deployment opportunities with new and existing Portfolio Companies can be executed rapidly while minimising operational risk.

In 2016, VPC reviewed 700 new Portfolio Company opportunities and deployed $1.2 billion into loans within the online lending sector. VPC's pipeline of deployment opportunities remains strong with both existing and new balance lending Portfolio Companies.

REGULATORY RISK

As an investment trust, the Company's operations are subject to wide ranging regulations. The financial services sector continues to experience significant regulatory change at national and international levels. Failure to act in accordance with these regulations could cause fines, censure or other losses including taxation or reputational loss.

In order to continue to qualify as an investment trust, the Company must comply with the requirements of Section 1158 of the Corporation Tax Act 2010.

MITIGATION

The Company provides debt capital to Portfolio Companies, which typically have to comply with various state and national level regulations. This includes some operating under interim permission and some now regulated from the FCA in the U.K. as well as consumer lending and collections licenses in some U.S. states. This risk is limited via detailed upfront due diligence of Portfolio Companies' regulatory environments performed by the Investment Manager on behalf of the Board.

The Company has procedures to monitor the status of its compliance with the relevant requirements to maintain its Investment Trust status, including receiving and reviewing information and reporting from the Company Secretary and other service providers as appropriate.

The Company has also considered Brexit's current and potential impact on the Company. Whilst the portfolio of the Company may not be facing any significant risk, the Company itself faces some uncertainty leading up to Brexit with regards to potential regulatory or tax changes. The majority of the Group's portfolio is denominated in United States Dollar and the Company has entered into derivative contracts to manage the exposure to foreign currency on existing assets. Therefore the Board has concluded that this event does not represent a principal risk to the Company.

Discussion on the Company's risk management and internal controls is on page 40 of the Annual Report.

ENVIRONMENT, HUMAN RIGHTS, EMPLOYEE, SOCIAL AND COMMUNITY ISSUES

The Board recognises the requirement of the Companies Act 2006 (Strategic Report and Directors' Report) Regulations 2013 to provide details about environmental matters, employees, human rights, social and community issues, including information about any policies it has in relation to these matters and the effectiveness of these polices. As an investment trust, the Company does not have any employees, and most of its activities are performed by other outside organisations. In light of this, the Board considers that the Company does not have a direct impact on the community or environment and, as a result, does not maintain specific policies in relation to these matters. However, in carrying out its investment activities and in relationships with suppliers, the Company aims to conduct itself responsibly, ethically and fairly.

GENDER DIVERSITY

The Board of Directors of the Company comprises four male Directors and one female Director. Further information in relation to the Board's policy on diversity can be found on pages 31 and 37 of the Annual Report.

The Strategic Report was approved by the Board of Directors on 27 April 2016 and signed on its behalf by:

Andrew Adcock

Chairman

27 April 2017

GOVERNANCE

RESPONSIBILITY FOR FINANCIAL STATEMENTS AND GOING CONCERN STATEMENT

As discussed in Note 6 to the financial statements, the Directors have reviewed the financial projections of the Company from the date of this report, which shows that the Company will be able to generate sufficient cash flows in order to meet its liabilities as they fall due. Accordingly, the Directors are satisfied that the going concern basis remains appropriate for the preparation of the financial statements. The Group also has detailed policies and processes for managing those risks on pages 21 to 23 of the Annual Report.

VIABILITY STATEMENT

In accordance with provision C2.2.2 of the U.K. Corporate Governance Code, published by the Financial Reporting Council in April 2016, and as part of an ongoing programme of risk assessment, the Directors have assessed the prospects of the Company, to the extent that they are able, over a three-year period. This period is appropriate since the Company's Articles of Association (the 'Articles') require an ordinary resolution for continuation of the Company to be proposed at the Company's Annual General Meeting in 2020. In addition, as the Company is a long-term investor, the Directors have chosen a three-year period as this is viewed as sufficiently long term to provide shareholders with a meaningful view, without extending the period so far into the future as to undermine the exercise.

The Directors confirm that they have a reasonable expectation that the Company will continue to operate and meet its liabilities as they fall due for the next three years. In making this assessment, the Directors have taken into consideration each of the principal risks and uncertainties on pages 21 to 23 of the Annual Report, their mitigants and the impact these might have on the business model, future performance, solvency and liquidity. In addition, the Directors considered the Company's current financial position and prospects, the composition of the investment portfolio, the level of outstanding capital commitments, the term structure and availability of borrowings and the ongoing costs of the business. As part of the approach, due consideration has been given to the uncertainty inherent in financial forecasts and, where applicable, reasonable sensitivities have been applied to the investment portfolio in stress situations.

The main risk to the Company's continuation is shareholder dissatisfaction through failure to meet the Company's investment objective, through poor investment performance or through the investment policy not being appropriate in prevailing market conditions. The Board has given this particular consideration when assessing the longer-term viability of the Company. Performance and demand for the Company's shares are not things that can be forecast.

Based on the foregoing analysis, the Directors have a reasonable expectation that the Company will be able to continue in operation and meet its liabilities as they fall due over the three-year period of their assessment.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The Directors are responsible for preparing the Annual Report, the Directors' Remuneration Report and the financial statements in accordance with applicable law and regulations.

Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have prepared the Group and Parent Company financial statements in accordance with International Financial Reporting Standards ('IFRSs') as adopted by the European Union. Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and the Parent Company and of the profit or loss of the Group for that period. In preparing these financial statements, the Directors are required to:

v select suitable accounting policies and then apply them consistently;

v make judgements and accounting estimates that are reasonable and prudent;

v state whether applicable IFRSs as adopted by the European Union have been followed for the Group financial statements and IFRSs as adopted by the European Union have been followed for the Parent Company financial statements, subject to any material departures disclosed and explained in the financial statements; and

v prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group and Company will continue in business.

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Group and the Parent Company and enable them to ensure that the financial statements and the Directors' Remuneration Report comply with the Companies Act 2006 and, about the group financial statements, Article 4 of the IAS Regulation.

The Directors are also responsible for safeguarding the assets of the Group and the Parent Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

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

The Directors consider that the Annual Report and Financial Statements, taken as a whole, is fair, balanced and understandable and provides the information necessary for shareholders to assess the Group and Company's performance, business model and strategy.

Each of the Directors, whose names and functions are listed in the Directors' Report confirm that, to the best of their knowledge:

v the Group financial statements, which have been prepared in accordance with IFRSs as adopted by the European Union, give a true and fair view of the assets, liabilities, financial position and profit of the Group;

v the Parent Company financial statements, which have been prepared in accordance with IFRSs as adopted by the European Union, give a true and fair view of the assets, liabilities, financial position and profit of the company; and

v the Directors' Report includes a fair review of the development and performance of the business and the position of the Group, together with a description of the principal risks and uncertainties that it faces.

In the case of each Director in office at the date the Directors' Report is approved:

v so far as the director is aware, there is no relevant audit information of which the Group and Company's auditors are unaware; and

v they have taken all the steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the Group and Company's auditors are aware of that information.

For and on behalf of the Board

Andrew Adcock

Chairman

27 April 2017

NON-STATUTORY ACCOUNTS

The financial information set out below does not constitute the Company's statutory accounts for the year ended 31 December 2016 but is derived from those accounts. Statutory accounts for the year ended 31 December 2016 will be delivered to the Registrar Of Companies in due course. The Auditors have reported on those accounts; their report was (i) unqualified, (ii) did not include a reference to any matters to which the Auditors drew attention by way of emphasis without qualifying their report and (ii) did not contain a statement under Section 498 (2) or (3) of the Companies Act 2006. The text of the Auditors' report can be found in the Company's full Annual Report and Financial Statements on the Company's website at http://vpcspecialtylending.com/.

FINANCIAL STATEMENTS

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE YEAR ENDED 31 DECEMBER 2016

The total column of this statement represents the Group's statement of comprehensive income, prepared in accordance with International Financial Reporting Standards ('IFRS') as adopted by the European Union. The supplementary revenue and capital columns are both prepared under guidance published by the Association of Investment Companies ('AIC'). All items in the above Statement derive from continuing operations.

The total column of this statement represents the Group's statement of comprehensive income, prepared in accordance with International Financial Reporting Standards ('IFRS') as adopted by the European Union. The supplementary revenue and capital columns are both prepared under guidance published by the Association of Investment Companies ('AIC'). All items in the above Statement derive from continuing operations.

PARENT COMPANY STATEMENT OF CASH FLOWS

FOR THE YEAR ENDED 31 DECEMBER 2016

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2016

1. GENERAL INFORMATION

The investment objective of VPC Specialty Lending Investments PLC (the 'Parent Company') with its subsidiaries (together 'the Group') is to generate an attractive total return for shareholders consisting of distributable income and capital growth through investments in specialty lending opportunities. The Parent Company was incorporated in England and Wales on 12 January 2015 with registered number 9385218. The Parent Company commenced its operations on 17 March 2015 and intends to carry on business as an investment trust within the meaning of Chapter 4 of Part 24 of the Corporation Tax Act 2010.

The Group's investment manager is Victory Park Capital Advisors, LLC (the 'Investment Manager'), a US Securities and Exchange Commission registered investment adviser. The Investment Manager also acts as the Alternative Investment Fund Manager of the Group under the Alternative Investment Fund Managers Directive ('AIFMD'). The Parent Company is defined as an Alternative Investment Fund and is subject to the relevant articles of the AIFMD.

The Group will invest directly or indirectly into available opportunities, including by making investments in, or acquiring interests held by, third party funds (including those managed by the Investment Manager or its affiliates). Direct investments may include consumer loans, SME loans, advances against corporate trade receivables and/or purchases of corporate trade receivables ('Debt Instruments') originated by platforms which engage with and directly lend to borrowers ('Portfolio Companies'). Such Debt Instruments may be subordinated in nature, or may be second lien, mezzanine or unsecured loans. Indirect investments may include investments in Portfolio Companies (or in structures set up by Portfolio Companies) through the provision of credit facilities ('Credit Facilities'), equity or other instruments. Additionally, the Group's investments in Debt Instruments and Credit Facilities may be made through subsidiaries of the Company or through partnerships or other structures. The Group may also invest in other specialty lending related opportunities through any combination of debt facilities, equity or other instruments.

During the period, the Company cancelled 183,000,000 C Shares on 3 March 2016 and issued 182,615,665 new Ordinary Shares on 4 March 2016. As at 31 December 2016, the Company held equity in the form of 382,615,665 Ordinary Shares, 381,115,665 Ordinary Shares in issue and 1,500,000 Ordinary Shares in Treasury (31 December 2015: 200,000,000 Ordinary Shares and 183,000,000 C Shares). The Ordinary Shares are listed on the premium segment of the Official List of the UK Listing Authority and trade on the London Stock Exchange's main market for listed securities.

Northern Trust Hedge Fund Services LLC (the 'Administrator') has been appointed as the administrator of the Group. The Administrator is responsible for the Group's general administrative functions, such as the calculation and publication of the Net Asset Value ('NAV') and maintenance of the Group's accounting records.

For any terms not herein defined, refer to Part X of the IPO Prospectus. The Parent Company's IPO Prospectus dated 26 February 2015 is available on the Parent Company's website, http://vpcspecialtylending.com.

2. SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies followed by the Group are set out below:

Basis of preparation

The consolidated financial statements present the financial performance of the Group for the year ended 31 December 2016. The consolidated financial statements are prepared in accordance with International Financial Reporting Standards ('IFRS'). They comprise standards and interpretations approved by the International Accounting Standards Board and International Financial Reporting Committee, interpretations approved by the International Accounting Standard Committee that remain in effect, to the extent they have been adopted by the European Union. The financial statements are also in compliance with relevant provisions of the Companies Act 2006 as applicable to companies reporting under IFRS.

The parent company financial statements have been prepared on a going concern basis under the historical cost convention, as modified by the valuation of investments and derivative financial instruments at fair value. Having assessed the principal risks, the Directors considered it appropriate to adopt the going concern basis of accounting in preparing the consolidated financial statements. The principal accounting policies adopted are set out below.

Where presentational guidance set out in the Statement of Recommended Practice ('SORP') for investment trusts issued by the Association of Investment Companies ('AIC') in November 2014 is consistent with the requirements of IFRS, the Directors have sought to prepare the consolidated financial statements on a basis compliant with the recommendations of the SORP.

The Parent Company and Group's presentational currency is Pound Sterling (£). Pound Sterling is also the functional currency because it is the currency of the Parent Company's share capital and the currency which is most relevant to the majority of the Parent Company's Shareholders. The Group enters into forward currency Pound Sterling hedges where operating activity is transacted in a currency other than the functional currency.

Basis of consolidation

The consolidated financial statements incorporate the financial statements of the Parent Company and its subsidiaries. Control is achieved where the Parent Company has the power to govern the financial and operating policies of an investee entity so as to obtain benefits from its activities. The Parent Company controls an entity when the Parent Company is exposed to, or has rights to, variable returns from its investment and has the ability to affect those returns through its power over the entity. All intra-group transactions, balances, income and expenses are eliminated in consolidation. The accounting policies of the subsidiaries have been applied on a consistent basis to ensure consistency with the policies adopted by the Parent Company. The period ends for the subsidiaries are consistent with the Company.

Subsidiaries of the Parent Company, where applicable, have been consolidated on a line by line basis as the Parent Company does not meet the definition of an investment entity under IFRS 10 because it does not measure and evaluate the performance of all of its investments on the fair value basis of accounting.

Investments in subsidiaries

Investments in subsidiaries are carried at cost less impairment. The Parent Company assesses at each balance sheet date whether, as a result of one or more events that occurred after initial recognition, there is objective evidence that investments in subsidiaries are impaired. Investments in subsidiaries are non-monetary items and therefore the costs of investment in currencies other than Pound Sterling are translated to at the rate of exchange ruling on the date the investment is made.

The total net asset value shown on the Parent Company Statement of Financial Position is therefore less than the consolidated net asset value shown for the Group by £31,259,112 as at 31 December 2016 (31 December 2015: less than by £8,910,863).

Presentation of Consolidated Statement of Comprehensive Income

In order to better reflect the activities of an investment trust company and in accordance with the guidance set out by the AIC, supplementary information which analyses the Consolidated Statement of Comprehensive Income between items of revenue and capital nature has been presented alongside the Consolidated Statement of Comprehensive Income.

The Directors have taken advantage of the exemption under Section 408 of the Companies Act 2006 and accordingly have not presented a separate Parent Company statement of comprehensive income. The net return on ordinary activities after taxation of the Parent Company was (£19,268,150) (31 December 2015: £5,649,016).

Income

For financial instruments measured at amortised cost, the effective interest rate method is used to measure the carrying value of a financial asset or liability and to allocate associated interest income or expense over the relevant period. The effective interest rate is the rate that discounts estimated future cash payments or receipts over the expected life of the financial instrument or, when appropriate, a shorter period, to the net carrying amount of the financial asset or financial liability.

In calculating the effective interest rate, the Group estimates cash flows considering all contractual terms of the financial instrument but does not consider expected credit losses. The calculation includes all fees received and paid, costs borne that are an integral part of the effective interest rate and all other premiums or discounts above or below market rates.

Dividend income from investments is taken to the revenue account on an ex-dividend basis. Bank interest and other income receivable is accounted for on an effective interest basis.

Distributions from investments in funds are accounted for on an accrual basis as of the date the Group is entitled to the distribution. The income is treated as revenue return provided that the underlying assets of the investments comprise solely income generating loans, or investments in lending platforms which themselves generate net interest income.

Expenses and finance costs

Expenses and finance costs not directly attributable to generating a financial instrument are recognised as services are received, or on the performance of a significant act which means the Group has become contractually obligated to settle those amounts.

The Group currently charges all expenses and finance costs, including investment management fees and performance fees, to either revenue or capital based on the retained earnings of the investment that generates the fees from the prospective of the Parent Company. All operating expenses of the Parent Company are charged to revenue as the current expectation is that the majority of the Group and Parent Company's return will be generated through revenue rather than capital gains on investments.

At 31 December 2016, management fees of £1,059,942 (31 December 2015: £29,072) have been charged to the capital return of the Group. No management or performance fees were charged to capital at the Parent Company. Refer to Note 10 for further details of the management and performance fees.

All expenses are accounted for on an accruals basis.

Dividends payable to Shareholders

Dividends payable to Shareholders are recognised in the Consolidated Statement of Changes in Equity when they are paid, or have been approved by Shareholders in the case of a final dividend and become a liability to the Parent Company.

Taxation

The tax currently payable is based on the taxable profit for the year. Taxable profit differs from net profit as reported in the Consolidated Statement of Comprehensive Income because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The Group's liability for current tax is calculated using tax rates that have been enacted or substantively enacted at the Consolidated Statement of Financial Position date.

In line with the recommendations of SORP for investment trusts issued by the AIC, the allocation method used to calculate tax relief on expenses presented against capital returns in the supplementary information in the Consolidated Statement of Comprehensive Income is the 'marginal basis'.

Under this basis, if taxable income is capable of being offset entirely by expenses presented in the revenue return column of the Consolidated Statement of Comprehensive Income, then no tax relief is transferred to the capital return column.

Investment trusts which have approval as such under section 1158 of the Corporation Taxes Act 2010 are not liable for taxation on capital gains.

Financial assets and financial liabilities

The Group classifies its financial assets and financial liabilities in one of the following categories below. The classification depends on the purpose for which the financial assets and liabilities were acquired. The classification of financial assets and liabilities are determined at initial recognition:

Financial assets and financial liabilities designated as held at fair value through profit or loss

This category consists of forward foreign exchange contracts and investments in funds.

Assets and liabilities in this category are carried at fair value. The fair values of derivative instruments are estimated using discounted cash flow models using yield curves that are based on observable market data or are based on valuations obtained from counterparties.

Investments in funds are carried at fair value through profit or loss and designated as such at inception. This is valued for the units at the balance sheet date based on the NAV where it is assessed that NAV equates to fair value.

Gains and losses arising from the changes in the fair values are recognised in the Consolidated Statement of Comprehensive Income.

Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. The Group's loan assets are classified as loans and receivables.

Loans are recognised when the funds are advanced to borrowers. Loans and receivables are carried at amortised cost using the effective interest rate method less provisions for impairment.

Purchases and sales of financial assets

Purchases and sales of financial assets are accounted for at trade date. Financial assets are derecognised when the rights to receive cash flows from the investments have expired or have been transferred and the Group has transferred substantially all risks and rewards of ownership.

Fair value estimation

The determination of fair value of investments requires the use of accounting estimates and assumptions that could cause material adjustment to the carrying value of those investments.

Impairment of financial assets

The Group assesses at each balance sheet date whether, as a result of one or more events that occurred after initial recognition, there is objective evidence that a financial asset or group of financial assets is impaired. Evidence of impairment may include:

v indications that the borrower or group of borrowers is experiencing significant financial difficulty;

v default or delinquency in interest or principal payments; or

v debt being restructured to reduce the burden on the borrower.

The Group assesses whether objective evidence of impairment exists either individually for assets that are separately significant or individually or collectively for assets that are not separately significant.

If there is no objective evidence of impairment for an individually assessed asset it is included in a group of assets with similar credit risk characteristics and collectively assessed for impairment.

If there is objective evidence that an impairment loss has been incurred, the amount of the loss is measured as the difference between the assets carrying amount and the present value of estimated future cash flows discounted at the asset's original effective interest rate. The resultant provisions are deducted from the appropriate asset values in the Consolidated Statement of Financial Position.

The methodology and assumptions used for estimating future cash flows are reviewed regularly by the Group to reduce any differences between loss estimates and actual loss experience.

If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised, the provision is adjusted and the amount of the reversal is recognised in the Consolidated Statement of Comprehensive Income.

Where a loan is not recoverable, it is written off against the related provision for loan impairment once all the necessary procedures have been completed and the amount of the loss has been determined. Subsequent recoveries of amounts previously written off are reflected against the impairment losses recorded in the Consolidated Statement of Comprehensive Income.

Financial liabilities

Borrowings, deposits, debt securities in issue and subordinated liabilities, if any, are recognised initially at fair value, being the issue proceeds net of premiums, discounts and transaction costs incurred.

All borrowings are subsequently measured at amortised cost using the effective interest rate method. Amortised cost is adjusted for the amortisation of any premiums, discounts and transaction costs. The amortisation is recognised in interest expense and similar charges using the effective interest rate method.

Financial liabilities are derecognised when the obligation is discharged, cancelled or has expired.

Derivatives

Derivatives are entered into to reduce exposures to fluctuations in interest rates, exchange rates, market indices and credit risks and are not used for speculative purposes.

Derivatives are carried at fair value with movements in fair values recorded in the Consolidated Statement of Comprehensive Income. Derivative financial instruments are valued using discounted cash flow models using yield curves that are based on observable market data or are based on valuations obtained from counterparties.

Gains and losses arising from derivative instruments are credited or charged to the Consolidated Statement of Comprehensive Income. Gains and losses of a revenue nature are reflected in the revenue column and gains and losses of a capital nature are reflected in the capital column. Gains and losses on forward foreign exchange contracts are reflected in Foreign exchange gain/(loss) in the Consolidated Statement of Comprehensive Income.

All derivatives are classified as assets where the fair value is positive and liabilities where the fair value is negative. Where there is the legal ability and intention to settle net, then the derivative is classified as a net asset or liability, as appropriate.

Securities sold under agreement to repurchase

The Group entered into an agreement with a third party to sell its ownership of an equity security under an agreement to repurchase the equity security from the third party at a future date. The Group is entitled to receive an amount equal to all income paid or distributed in respect of the equity security to the full extent it would be so entitled if the equity security had not been sold to the third party. The Group is obligated to pay the third party monthly interest.

The underlying value of the repurchase agreement is valued under the sole discretion of the third party. Reductions in the value of the repurchase agreement could require the Group to make margin calls up to the value of the repurchase agreement purchase price. No margin was called during the year. The agreement matures on 30 June 2017 but can be extended for an additional three-month period under the discretion of the Group.

Securities sold under agreements to repurchase are valued based on the maximum of their purchase price or the current broker bid price on the sold security.

Offsetting financial instruments

Financial assets and liabilities are offset and the net amount reported in the Consolidated Statement of Financial Position if, and only if, there is currently enforceable legal right to set off the recognised amounts and there is an intention to settle on a net basis, or to realise an asset and settle the liability simultaneously.

Investments in funds

Investments in funds are measured at fair value through profit or loss. Refer to Note 18 for further information.

Equity securities

Equity securities are measured at fair value. These securities are considered either Level 2 or Level 3 investments. Further details of the valuation of equity securities are included in Footnote 3.

Other receivables

Other receivables do not carry interest and are short-term in nature and are accordingly recognised at fair value as reduced by appropriate allowances for estimated irrecoverable amounts.

Cash and cash equivalents

Cash comprises of cash on hand and demand deposits. Cash equivalents are short-term, highly liquid investments with a maturity of 90 days or less that readily convertible to known amounts of cash.

Current liabilities

Current liabilities, other than derivatives, are not interest-bearing and are stated at their nominal values. Due to their short term nature this is determined to be equivalent to their fair value.

Shares

Both the Ordinary Shares and C Shares, for the time to their conversion date (together the 'Shares') are classified as equity. The costs of issuing or acquiring equity are recognised in equity (net of any related income tax benefit), as a reduction of equity on the condition that these are incremental costs directly attributable to the equity transaction that otherwise would have been avoided.

The costs of an equity transaction that is abandoned are recognised as an expense. Those costs might include registration and other regulatory fees, amounts paid to legal, accounting and other professional advisers, printing costs and stamp duties.

The Group's equity NAV per unit is calculated by dividing the equity - net assets attributable to the holder of Shares by the total number of outstanding shares.

Foreign exchange

Transactions in foreign currencies are translated into Pound Sterling at the rate of exchange ruling on the date of each transaction. Monetary assets, liabilities and equity investments in foreign currencies at the Consolidated Statement of Financial Position date are translated into Pound Sterling at the rates of exchange ruling on that date. Profits or losses on exchange, together with differences arising on the translation of foreign currency assets or liabilities, are taken to the capital return column of the Consolidated Statement of Comprehensive Income. Foreign exchange gains and losses arising on investment assets including loans are included within Net gain/(loss) on investments within the capital return column of the Consolidated Statement of Comprehensive Income.

The assets and liabilities of the Group's foreign operations are translated using the exchange rates prevailing at the reporting date. Income and expense items are translated using the average exchange rates during the period. Exchange differences arising from the translation of foreign operations are taken directly as currency translation differences through the Consolidated Statement of Comprehensive Income.

Capital reserves

Capital reserve - arising on investments sold includes:

v gains/losses on disposal of investments and the related foreign exchange differences;

v exchange differences on currency balances;

v cost of own shares bought back; and

v other capital charges and credits charged to this account in accordance with the accounting policies above.

Capital reserve - arising on investments held includes:

v increases and decreases in the valuation of investments held at the period end; and

v investments in subsidiaries by the Parent Company where retained earnings is negative.

In the instance where the retained earnings of the Parent Company's investment in a subsidiary are negative, all income and expenses from that investment are allocated to the capital reserve for both the Group and the Parent Company.

All of the above are accounted for in the Consolidated Statement of Comprehensive Income except the cost of own shares bought back, if applicable, which would be accounted for in the Consolidated Statement of Changes in Equity.

Segmental reporting

The chief operating decision maker is the Board of Directors. The Directors are of the opinion that the Group is engaged in a single segment of business, being the investment of the Group's capital in financial assets comprising consumer loans, SME loans, corporate trade receivables and/or advances thereon. The Board focuses on the overall return from these assets irrespective of the structure through which the investment is made.

Critical accounting estimates and assumptions

Estimates and assumptions used in preparing the consolidated financial statements are reviewed on an ongoing basis and are based on historical experience and various other factors that are believed to be reasonable under the circumstances.

The results of these estimates and assumptions form the basis of making judgments about carrying values of assets and liabilities that are not readily apparent from other sources.

Estimates and assumptions made in the valuation of unquoted investments and investments for which there is no active market may cause material adjustment to the carrying value of those assets and liabilities. These are valued in accordance with the techniques set out above.

The assessment of impairment of the financial assets held at amortised cost requires the use of accounting estimates and assumptions that could cause material adjustment to the carrying value of those investments. The methodology and assumptions used for estimating future cash flows are reviewed regularly by the Group. The significant estimates and assumptions for the loan loss reserve are derived from the historical performance of the Group's loans. Information about significant areas of estimation uncertainty and critical judgments in relation to the impairment of investments are described in Note 9.

Judgement is required to determine whether the Parent Company exercises control over its investee entities and whether they should be consolidated. Control is achieved where the Parent Company has the power to govern the financial and operating policies of an investee entity so as to obtain benefits from its activities. The Parent Company controls an investee entity when the Parent Company is exposed to, or has rights to, variable returns from its investment and has the ability to affect those returns through its power over the entity. At each reporting date an assessment is undertaken of investee entities to determine control. In the intervening period assessments are undertaken where circumstances change that may give rise to a change in the control assessment. These include when an investment is made into a new entity, or an amendment to existing entity documentation or processes. When assessing whether the Parent Company has the power to affect its variable returns, and therefore control investee entities, an assessment is undertaken of the Parent Company's ability to influence the relevant activities of the investee entity. These activities include considering the ability to appoint or remove key management or the manager, which party has decision making powers over the entity and whether the manager of an entity is acting as principal or agent. The assessment undertaken for entities considers the Parent Company's level of investment into the entity and its intended long-term holding in the entity and there may be instances where the Parent Company owns less than 51% of an investee entity but that entity it consolidated. Further details of the Parent Company's subsidiaries are included in Note 16.

Accounting standards issued but not yet effective

The following new standards are not applicable to this financial information but may have an impact when they become effective:

IFRS 9, 'Financial Instruments', introduces new requirements for classification and measurement, impairment and hedge accounting. This standard is effective from 1 January 2018. The adoption of IFRS 9 results in an impairment model that is more forward looking than that which is currently in place under IAS 39. In the longer term it is expected that the adoption of the standard will increase the total level of impairment allowance as financial assets will be assessed for impairment at least to the extent that an impairment is expected to arise within the following 12 month period and this impairment amount recognised within the financial statements.

IFRS 15, 'Revenue from Contracts with Customers', requires revenue to be recognised at an amount that reflects the consideration to which an entity expects to be entitled in exchange for transferring services to a customer. This standard is effective from 1 January 2019. The adoption of this standard is not expected to have a significant impact on the Group's financial statements.

The Directors are assessing the impact of the above standards on the Group's future consolidated financial information. The Directors are commencing a preliminary assessment of the impact of IFRS 9 on the Group and Parent Company, which will continue during 2017 and the Directors are not expecting to adopt the standard before its effective date. IFRS 15 is not expected to have a material impact on the Group and Parent Company.

3. FAIR VALUE MEASUREMENT

Financial instruments measured and reported at fair value are classified and disclosed in one of the following fair value hierarchy levels based on the significance of the inputs used in measuring its fair value:

Level 1 - Quoted prices (unadjusted) in active markets for identical assets and liabilities;

Level 2 - Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (as prices) or indirectly (derived from prices); and

Level 3 - Pricing inputs for the asset or liability that are not based on observable market data (unobservable inputs).

An investment is always categorised as Level 1, 2 or 3 in its entirety. In certain cases, the fair value measurement for an investment may use a number of different inputs that fall into different levels of the fair value hierarchy. In such cases, an investment's level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The assessment of the significance of a particular input to the fair value measurement requires judgment and is specific to the investment.

Valuation of investments in funds

The Group's investments in funds are subject to the terms and conditions of the respective fund's offering documentation. The investments in funds are primarily valued based on the latest available financial information. The Investment Manager reviews the details of the reported information obtained from the funds and considers: (i) the valuation of the fund's underlying investments; (ii) the value date of the NAV provided; (iii) cash flows (calls/distributions) since the latest value date; and (iv) the basis of accounting and, in instances where the basis of accounting is other than fair value, fair valuation information provided by the funds. If necessary, adjustments to the NAV are made to the funds to obtain the best estimate of fair value. The funds in which the Group invests are close-ended and unquoted. The NAV is provided to investors only and is not made publicly available.

Valuation of equity securities

Fair value is determined based on the Group's valuation methodology, which is either determined using recent transactions, discounted cash flow models or the Black Scholes pricing model.

In using a valuation methodology based on the discounting of forecasted cash flows of the Portfolio Company, significant judgment is required in the development of an appropriate discount rate to be applied to the forecasted cash flows. The assumptions incorporated in the valuation methodologies used to estimate the enterprise value consists primarily of unobservable Level 3 inputs, including management assumptions based on judgment. In evaluating the impact on the valuation for such items, the amount that a market participant would consider in estimating fair value is considered. These estimates are highly subjective, based on the Group's assessment of the potential outcome(s) and the related impact on the fair value of such potential outcome(s). A change in these assumptions could have a material impact on the determination of fair value.

Options and warrants to purchase or sell shares of privately held companies are valued based on the estimated market value of the underlying common shares using the Black Scholes pricing model, which may be adjusted to reflect the associated risks. Options and warrants to purchase or sell shares of privately held companies that are significantly out of the money may be valued at the fixed option or warrant price.

Fair value disclosures

The following table analyses the fair value hierarchy of the Group's assets and liabilities measured at fair value at 31 December 2016:

The following table analyses the fair value hierarchy of the Group's assets and liabilities measured at fair value at 31 December 2015:

The following table analyses the fair value hierarchy of the Parent Company's assets and liabilities measured at fair value at 31 December 2016:

There was movement of one position between Level 1 and Level 2 fair value measurements during the period ended 31 December 2016. There were no transfers into and out of Level 3 fair value measurements for either the Parent Company or the Group during the period ended 31 December 2016.

The following table analyses the fair value hierarchy of the Parent Company's assets and liabilities measured at fair value at 31 December 2015:

There were no movements between Level 1 and Level 2 fair value measurements during the period ended 31 December 2015 and no transfers into and out of Level 3 fair value measurements for either the Parent Company or the Group.

The following table presents the movement in Level 3 positions for the year ended 31 December 2016 for the Group:

The following table presents the movement in Level 3 positions for the year ended 31 December 2015 for the Group:

The following table presents the movement in Level 3 positions for the period ended 31 December 2016 for the Parent Company:

The net change in unrealised gains is recognised within gains on investments in the Consolidated Statement of Comprehensive Income.

The following table presents the movement in Level 3 positions for the period ended 31 December 2015 for the Parent Company:

The net change in unrealised gains is recognised within gains on investments in the Consolidated Statement of Comprehensive Income.

Quantitative information regarding the unobservable inputs for Level 3 positions is given below:

The investments in funds consist of investments in Larkdale III, L.P. and VPC Offshore Unleveraged Private Debt Fund, L.P. These are valued based on the NAV as calculated at the balance sheet date. No adjustments have been deemed necessary to the NAV as it reflects the fair value of the underlying investments, as such no specific unobservable inputs have been identified. The NAVs are sensitive to movements in interest rates due to the funds' underlying investment in loans.

If the discount rate of the equity securities valued based on discounted cash flows increased / decreased by two per cent. it would have resulted in an increase / decrease to the total value of those equity securities of £469,724 which would affect the Net gain / (loss) on investments within the capital return column of the Consolidated Statement of Comprehensive Income.

If the projected cumulative losses of the equity securities valued based on discounted cash flows increase / decreased by one per cent. it would have resulted in a decrease / increase to the total value of those equity securities of £982,802 which would affect the Net gain / (loss) on investments within the capital return column of the Consolidated Statement of Comprehensive Income.

If the price of all the investment assets held at period end, including individually those mentioned above, had increased / decreased by five per cent. it would have resulted in an increase / decrease in the total value the funds and equity securities of £2,980,742 which would affect the Net gain / (loss) on investments within the capital return column of the Consolidated Statement of Comprehensive Income.

Assets and liabilities not carried at fair value but for which fair value is disclosed

The following table presents the fair value of the Group's assets and liabilities not measured at fair value through profit and loss at 31 December 2016 but for which fair value is disclosed. The carrying value has been used where it is a reasonable approximation of fair value:

The following table presents the fair value of the Parent Company's assets and liabilities not measured at fair value through profit and loss at 31 December 2016 but for which fair value is disclosed. The carrying value has been used where it is a reasonable approximation of fair value:

The following table presents the fair value of the Group's assets and liabilities not measured at fair value through profit and loss at 31 December 2015 but for which fair value is disclosed. The carrying value has been used where it is a reasonable approximation of fair value:

The following table presents the fair value of the Parent Company's assets and liabilities not measured at fair value through profit and loss at 31 December 2015 but for which fair value is disclosed. The carrying value has been used where it is a reasonable approximation of fair value:

4. DERIVATIVES

Typically, derivative contracts serve as components of the Group's investment strategy and are utilised primarily to structure and hedge investments to enhance performance and reduce risk to the Group (the Group currently does not designate any derivatives as hedges for hedge accounting purposes as described under IAS 39). Derivative instruments are also used for trading purposes where the Investment Manager believes this would be more effective than investing directly in the underlying financial instruments. The only derivative contracts that the Group currently holds or issues are forward foreign exchange contracts.

The Group measures its derivative instruments on a fair value basis. See Note 2 for the valuation policy for financial instruments.

Forward contracts

Forward contracts entered into represent a firm commitment to buy or sell an underlying asset, or currency at a specified value and point in time based upon an agreed or contracted quantity. The realised/unrealised gain or loss is equal to the difference between the value of the contract at the onset and the value of the contract at settlement date/year end date and is included in the Consolidated Statement of Comprehensive Income.

As at 31 December 2016, the following forward foreign exchange contracts were included in the Group's Consolidated Statement of Financial Position at fair value through profit or loss and the Parent Company's Statement of Financial Position at fair value through profit or loss:

As at 31 December 2015, the following forward foreign exchange contracts were included in the Group's Consolidated Statement of Financial Position at fair value through profit or loss and the Parent Company's Statement of Financial Position at fair value through profit or loss:

The following tables provide information on the financial impact of netting for instruments subject to an enforceable master netting arrangement or similar agreement at 31 December 2016 for both the Parent Company and the Group:

The following tables provide information on the financial impact of netting for instruments subject to an enforceable master netting arrangement or similar agreement at 31 December 2015 for both the Parent Company and the Group:

5. INCOME AND GAINS ON INVESTMENTS AND LOANS

6. FINANCIAL INSTRUMENTS AND ASSOCIATED RISKS

Introduction

Risk is inherent in the Group's activities but it is managed through a process of ongoing identification, measurement and monitoring, subject to risk limits and other controls. The Group is exposed to market risk (which includes currency risk, interest rate risk and other price risk), credit risk and liquidity risk arising from the financial instruments held by the Group.

Risk management structure

The Directors are ultimately responsible for identifying and controlling risks. Day to day management of the risk arising from the financial instruments held by the Group has been delegated to Victory Park Capital Advisors, LLC as Investment Manager to the Parent Company and the Group.

The Investment Manager regularly reviews the investment portfolio and industry developments to ensure that any events which impact the Group are identified and considered. This also ensures that any risks affecting the investment portfolio are identified and mitigated to the fullest extent possible.

The Group has no employees and the Directors have all been appointed on a Non-Executive basis. Whilst the Group has taken all reasonable steps to establish and maintain adequate procedures, systems and controls to enable it to comply with its obligations, the Group is reliant upon the performance of third party service providers for its executive function. In particular, the Investment Manager, the Custodian, the Administrator and the Registrar will be performing services which are integral to the operation of the Group. Failure by any service provider to carry out its obligations to the Group in accordance with the terms of its appointment could have a materially detrimental impact on the operation of the Group.

The principal risks and uncertainties that could have a material impact on the Group's performance have not changed from those set out in detail on pages 14 to 24 of the Parent Company's IPO Prospectus.

In seeking to implement the investment objectives of the Parent Company while limiting risk, the Parent Company and the Group are subject to the investment limits restrictions set out in the Credit Risk section of this note.

Market risk (incorporating price, interest rate risk and currency)

Market risk is the risk of loss arising from movements in observable market variables such as foreign exchange rates, equity prices and interest rates. The Group is exposed to market risk primarily through its Financial Instruments.

Market price risk

The Group is exposed to price risk arising from the investments held by the Group for which prices in the future are uncertain. The investment in funds are exposed to market price risk. Refer to Note 3 for further details on the sensitivity of the Group's Level 3 investments to price risk.

Interest rate risk

Interest rate risk arises from the possibility that changes in interest rates will affect future cash flows or the fair values of financial instruments.

The Group is exposed to risks associated with the effects of fluctuations in the prevailing levels of market interest rates on its financial position and cash flows. Due to the nature of the investments at 31 December 2016, the Group has limited exposure to variations in interest rates as all current interest rates are fixed and determinable or variable based on the size of the loan.

While the Group is exposed to risks associated with the effects of fluctuations in the prevailing levels of market interest rates on its financial position and cash flows, the downside exposure of the Group is limited at 31 December 2016 due to the fixed rate nature of the investments or interest rate floors that are in place on most of the Group's variable interest rate loans.

The Group does not intend to hedge interest rate risk on a regular basis. However, where it enters floating rate liabilities against fixed-rate loans, it may at its sole discretion seek to hedge out the interest rate exposure, taking into consideration amongst other things the cost of hedging and the general interest rate environment.

Currency risk

Currency risk is the risk that the value of net assets will fluctuate due to changes in foreign exchange rates. Relevant risk variables are generally movements in the exchange rates of non-functional currencies in which the Group holds financial assets and liabilities.

The assets of the Group as of 31 December 2016 are invested in assets which are denominated in US Dollars, Euros, Pound Sterling and other currencies. Accordingly, the value of such assets may be affected favourably or unfavourably by fluctuations in currency rates. The Group hedges currency exposure between Pound Sterling and any other currency in which the Group's assets may be denominated, in particular US Dollars, Australian Dollars and Euros.

Micro and Small Cap Company Investing Risk

The Group will generally invest with companies that are small, not widely known and not widely held. Small companies tend to be more vulnerable to adverse developments than larger companies and may have little or no track records. Small companies may have limited product lines, markets, or financial resources, and may depend on less seasoned management. Their securities may trade infrequently and in limited volumes. It may take a relatively long period of time to accumulate an investment in a particular issue in order to minimise the effect of purchases on market price. Similarly, it could be difficult to dispose of such investments on a timely basis without adversely affecting market prices. As a result, the prices of these securities may fluctuate more than the prices of larger, more widely traded companies. Also, there may be less publicly available information about small companies or less market interest in their securities compared to larger companies, and it may take longer for the prices of these securities to reflect the full value of their issuers' earnings potential or assets.

Leverage and Borrowing Risk

Whilst the use of borrowings by the Group should enhance the net asset value of an investment when the value of an investment's underlying assets is rising, it will, however, have the opposite effect where the underlying asset value is falling. In addition, in the event that an investment's income falls for whatever reason, the use of borrowings will increase the impact of such a fall on the net revenue of the Group's investment and accordingly will have an adverse effect on the ability of the investment to make distributions to the Group.

Concentration of foreign currency exposure

The Investment Manager monitors the fluctuations in foreign currency exchange rates and may use forward foreign exchange contracts to hedge the currency exposure of the Parent Company and Group's non GBP denominated investments. The Investment Manager re-examines the currency exposure on a regular basis in each currency and manages the Parent Company's currency exposure in accordance with market expectations.

The below table presents the net exposure to foreign currency at 31 December 2016. The table includes forward foreign exchange contracts at their notional exposure value and excludes all GBP assets and liabilities recorded on the Group's Consolidated Statement of Financial Position.

If the GBP exchange rate simultaneously increased/decreased by five per cent. against the above currencies, the impact on profit would be an increase/decrease of £3,158,392 (31 December 2015: £5,807,844). Five per cent. is considered to be a reasonably possible movement in foreign exchange rates. The table above includes the exposure of the non-consolidated interest investment in the Group.

The below table presents the net exposure to foreign currency at 31 December 2015. The table includes forward foreign exchange contracts at their notional exposure value and excludes all GBP assets and liabilities recorded on the Group's Consolidated Statement of Financial Position.

The table below presents the net exposure to foreign currency at 31 December 2016. The table includes forward foreign exchange contracts at their notional exposure value and excludes all GBP assets and liabilities recorded on the Parent Company's Statement of Financial Position.

If the GBP exchange rate simultaneously increased/decreased by five per cent. against the above currencies, the impact on profit would be an increase/decrease of £1,412,861 (31 December 2015: £137,404). Five per cent. is considered to be a reasonably possible movement in foreign exchange rates.

The table below presents the net exposure to foreign currency at 31 December 2015. The table includes forward foreign exchange contracts at their notional exposure value and excludes all GBP assets and liabilities recorded on the Parent Company's Statement of Financial Position.

Liquidity risk

Liquidity risk is defined as the risk that the Group may not be able to settle or meet its obligations on time or at a reasonable price. Ordinary Shares are not redeemable at the holder's option.

The maturities of the non-current financial liabilities are disclosed in Note 8.

Current financial liabilities consisting of fees payable, accrued expenses and other liabilities are all due within three months.

The Investment Manager manages the Group's liquidity risk by investing primarily in a diverse portfolio of assets. At 31 December 2016, 2% of the loans have a stated maturity date of less than a year (31 December 2015: 2%). The Group has no loans with a maturity date of more than five years.

The Group and Parent Company continuously monitor for fluctuation in currency rates. The Parent Company performs stress tests and liquidity projections to determine how much cash should be held back to meet potential future to obligations to settle margin calls arising from foreign exchange hedging.

Credit risk

Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation.

The Group's credit risks arise principally through exposures to loans acquired by the Group, which are subject to risk of borrower default. The ability of the Group to earn revenue is completely dependent upon payments being made by the borrower of the loan acquired by the Group through a Platform. The Group (as a lender member) will receive payments under any loans it acquires through a Platform only if the corresponding borrower through that Platform (borrower member) makes payments on the loan.

Consumer loans are unsecured obligations of borrower members. They are not secured by any collateral, not guaranteed or insured by any third party and not backed by any governmental authority in any way.

The Group will invest across various Platforms, asset classes, geographies (primarily United States and Europe) and credit bands in order to ensure diversification and to seek to mitigate concentration risks.

Credit quality

The credit quality of loans is assessed through the evaluation of various factors, including (but not limited to) credit scores, payment data, collateral and other information. Set out below is the analysis of the Group's loan investments by grade and geography:

The following investment limits and restrictions shall apply to the Group, to ensure that the diversification of the Group's portfolio is maintained and that concentration risk is limited:

Portfolio Company restrictions

The Group does not intend to invest more than 20% of its Gross Assets in Debt Instruments (net of any gearing ring-fenced within any special purpose vehicle which would be without recourse to the Group), originated by, and/or Credit Facilities and equity instruments in, any single Portfolio Company, calculated at the time of investment. All such aggregate exposure to any single Portfolio Company (including investments via a special purpose vehicle) will always be subject to an absolute maximum, calculated at the time of investment, of 25% of the Group's Gross Assets.

Asset class restrictions

The Group does not intend to acquire Debt Instruments for a term longer than five years. The Group will not invest more than 20% of its Gross Assets, at the time of investment, via any single investment fund investing in Debt Instruments and Credit Facilities. In any event, the Group will not invest, in aggregate, more than 60% of its Gross Assets, at the time of investment, in investment funds that invest in Debt Instruments and Credit Facilities.

The Group will not invest more than 10% of its Gross Assets, at the time of investment, in other listed closed-ended investment funds, whether managed by the Investment Manager or not, except that this restriction shall not apply to investments in listed closed-ended investment funds which themselves have stated investment policies to invest no more than 15% of their gross assets in other listed closed-ended investment funds.

The following restrictions apply, in each case at the time of investment by the Group, to both Debt Instruments acquired by the Group via wholly-owned special purpose vehicles or partially-owned special purpose vehicles on a proportionate basis under the Marketplace Model, as well as on a look-through basis under the Balance Sheet Model and to any Debt Instruments held by another investment fund in which the Group invests: No single consumer loan acquired by the Group shall exceed 0.25% of its Gross Assets.

v No single consumer loan acquired by the Group shall exceed 0.25% of its Gross Assets.

v No single SME loan acquired by the Group shall exceed 5.0% of its Gross Assets. For the avoidance of doubt, Credit Facilities entered into directly with Platforms are not considered SME loans.

v No single trade receivable asset acquired by the Group shall exceed 5.0% of its Gross Assets.

Other restrictions

The Group's un-invested or surplus capital or assets may be invested in Cash Instruments for cash management purposes and with a view to enhancing returns to Shareholders or mitigating credit exposure.

7. CASH AND CASH EQUIVALENTS

The Parent Company has posted cash of £9,570,000 of collateral as at 31 December 2016 (31 December 2015: £8,480,000) with Goldman Sachs and cash of £1,136,410 (31 December 2015: Nil) with Morgan Stanley in relation to the outstanding derivative financial liabilities.

8. NOTES PAYABLE

The Group entered into contractual obligations with third parties to structurally subordinate a portion of the principal directly attributable to existing investments. The cash flows received by the Group from the underlying investments are used to pay the lender principal, interest, and draw fees based upon the stated terms of the Credit Facility. Unless due to a fraudulent act, as defined by the Credit Facilities, none of the Group's other investment assets can be used to satisfy the obligations of the Credit Facilities in the event that those obligations cannot be met by the subsidiaries. Each subsidiary with a Credit Facility is a bankruptcy remote entity. The table below provides details of the outstanding debt of the Group at 31 December 2016:

The table below provides details of the outstanding debt of the Group at 31 December 2015:

The Group entered into contractual obligations with a third party to structurally subordinate a portion of principal directly attributable to an existing loan facility. The Group is obligated to pay a commitment fee and interest to the third party on the obligation as interest is paid on the underlying loan facility. In the event of a default on the loan facility, the third party has first-out participation rights on the accrued and unpaid interest as well as the principal balance of the note. The table below provides details of the outstanding first-out participation liabilities of the Group at 31 December 2016:

The table below provides details of the outstanding first-out participation liabilities of the Group at 31 December 2015:

9. IMPAIRMENT OF FINANCIAL ASSETS AT AMORTISED COST

The table below provides details of the investments at amortised cost held by the Group for the period ended 31 December 2016:

The table below provides details of the investments at amortised cost held by the Group for the period ended 31 December 2015:

The Parent Company does not hold any loans.

Impairment charge

The impairment charge of the Group as at 31 December 2016 comprises of the following:

Impairment of loans written off

A financial asset is past due when the counterparty has failed to make a payment when contractually due. The Group assesses at each reporting date whether there is objective evidence that a loan or group of loans, classified as loans at amortised cost, is impaired. In performing such analysis, the Group assesses the probability of default based on the number of days past due, using recent historical rates of default on loan portfolios with credit risk characteristics similar to those of the Group.

Impairment charges of loans written off £36,505,295 (31 December 2015: £5,886,986) are included in impairment charges on the Consolidated Statement of Comprehensive Income.

Impairment of loans reserved against

Loans are judged for impairment primarily based on payment delinquency. General expectations with regards to expected losses on loans at a given level of delinquency were assessed based on historical roll rates on the loans purchased by the Group. Impairments are recognised once a loan was deemed to have a non-trivial likelihood of facing a material loss. The reserve reflects the increasing likelihood of loss as loans progress to more advanced stages of delinquency as more payments are missed and are calculated based on historical performance of similar loans within the Group's investment portfolio. As loans progress through the levels of delinquency, the Group reserves a greater amount of the loan balance. If a loan is delinquent for more than 90 days or has four missed payments, the Group reserves at least 85% of the balance of the delinquent loan.

As at 31 December 2016, the Group has created a reserve provision on the outstanding principal of the Group's loans of £12,799,694 (31 December 2015: £7,120,117), which have been recorded in the Group's Consolidated Statement of Financial Position and are included in impairment charges on the Consolidated Statement of Comprehensive Income. The reserve provision is estimated using historical performance data about the Group's loans which is regularly updated and reviewed. A five per cent. increase in relation to the assumed delinquency and loss rates would increase the provision and the impairment charge shown in the Consolidated Statement of Comprehensive Income by £631,436. A decrease in these assumptions would have an opposite effect.

10. FEES AND EXPENSES

Investment management and performance fees

Under the terms of the Management Agreement, the Investment Manager is entitled to a management fee and a performance fee together with reimbursement of reasonable expenses incurred by it in the performance of its duties.

The management fee is payable in Pound Sterling monthly in arrears and is at the rate of 1/12 of 1.0% per month of NAV (the 'Management Fee'). For the period from Admission until the date on which 90% of the net proceeds of the Issue have been invested or committed for investment (other than in Cash Instruments), the value attributable to any Cash Instruments of the Group held for investment purposes will be excluded from the calculation of NAV for the purposes of determining the Management Fee.

The Investment Manager shall not charge a management fee twice. Accordingly, if at any time the Group invests in or through any other investment fund or special purpose vehicle and a management fee or advisory fee is charged to such investment fund or special purpose vehicle by the Investment Manager or any of its affiliates, the Investment Manger agrees to either (at the option of the Investment Manager): (i) waive such management fee or advisory fee due to the Investment Manager or any of its affiliates in respect of such investment fund or special purpose vehicle, other than the fees charged by the Investment Manager under the Management Agreement; or (ii) charge the relevant fee to the relevant investment fund or special purpose vehicle, subject to the cap set out in the paragraph below, and ensure that the value of such investment shall be excluded from the calculation of the NAV for the purposes of determining the Management Fee payable pursuant to the above. The management fee expense for the period is £6,086,479 (31 December 2015: £2,158,389), of which £841,126 (31 December 2015: £836,541) was payable as of 31 December 2016.

Notwithstanding the above, where such investment fund or special purpose vehicle employs leverage from third parties and the Investment Manager or any of its affiliates is entitled to charge it a fee based on gross assets in respect of such investment, the Investment Manager may not charge a fee greater than 1.0% per annum of gross assets in respect of any investment made by the Parent Company or any member of the Group.

The performance fee is calculated by reference to the movements in the Adjusted NAV (as defined below) since the end of the Calculation Period in respect of which a performance fee was last earned or Admission if no performance fee has yet been earned (the 'High Water Mark').

The performance fee will be calculated in respect of each 12 month period starting on 1 January and ending on 31 December in each calendar year (a 'Calculation Period'), and provided further that if at the end of what would otherwise be a Calculation Period no performance fee has been earned in respect of that period, the Calculation Period shall carry on for the next 12 month period and shall be deemed to be the same Calculation Period and this process shall continue until a performance fee is next earned at the end of the relevant period.

The performance fee will be a sum equal to 15%. of such amount (if positive) and will only be payable if the Adjusted NAV at the end of a Calculation Period exceeds the High Water Mark. The performance fee shall be payable to the Investment Manager in arrears within 30 calendar days of the end of the relevant Calculation Period. 'Adjusted Net Value' means the NAV adjusted for: (i) any increases or decreases in NAV arising from issues or repurchases of Ordinary Shares during the relevant Calculation Period; (ii) adding back the aggregate amount of any dividends or distributions (for which no adjustment has already been made under (i)) made by the Parent Company at any time during the relevant Calculation Period; and (iii) before deduction for any accrued performance fees.

The Investment Manager shall not charge a performance fee twice. Accordingly, if at any time the Group invests in or through any other investment fund, special purpose vehicle or managed account arrangement and a performance fee or carried interest is charged to such investment fund, special purpose vehicle or managed account arrangement by the Investment Manager or any of its affiliates, the Investment Manager agrees to (and shall procure that all of its relevant affiliates shall) either (at the option of the Investment Manager): (i) waive such performance fee or carried interest suffered by the Group by virtue of the Investment Manager's (or such relevant affiliate's/affiliates') management of (or advisory role in respect of) such investment fund, special purpose vehicle or managed account, other than the fees charged by the Investment Manager under the Management Agreement; or (ii) calculate the performance fee as above, except that in making such calculation the NAV (as of the date of the High Water Mark) and the Adjusted NAV (as of the NAV calculation date) shall not include the value of any assets invested in any other investment fund, special purpose vehicle or managed account arrangement that is charged a performance fee or carried interest by the Investment Manager or any of its affiliates (and such performance fee or carried interest is not waived with respect to the Group). The performance fee expense for the period is £459,410 (31 December 2015: £1,301,904).

Earn-out fee

Certain loans purchased by the Group through a Platform are subject to a performance fee that the seller may be entitled to receive from the Group with respect to the performance of the loans. This fee may be due to the Platform 12 months after the purchase of the loans from the Platform. At 31 December 2016, the amount the Group has recognised is £1,551,457 (31 December 2015: £2,909,078) and it is included in other liabilities and accrued expenses on the Consolidated Statement of Financial Position.

Administration

The Group has entered into an administration agreement with Northern Trust Hedge Fund Services LLC. The Group pays to the Administrator an annual administration fee based on the Parent Company's net assets subject to a monthly minimum charge.

The Administrator shall also be entitled to be repaid all of its reasonable out-of-pocket expenses incurred on behalf of the Group. All Administrator fees are included in other expenses on the Consolidated Statement of Comprehensive Income.

Secretary

Under the terms of the Company Secretarial Agreement, Capita Registrars Limited is entitled to an annual fee of £50,000 (exclusive of VAT and disbursements). All Secretary fees are included in other expenses on the Consolidated Statement of Comprehensive Income.

Registrar

Under the terms of the Registrar Agreement, the Registrar is entitled to an annual maintenance fee of £1.25 per Shareholder account per annum, subject to a minimum fee of £2,500 per annum (exclusive of VAT). All Registrar fees are included in other expenses on the Consolidated Statement of Comprehensive Income.

Custodian

Under the terms of the Custodian Agreement, Merrill Lynch, Pierce, Fenner & Smith Incorporated is entitled to be paid a fee of between US$180 and US$500 per annum per holding of securities in an entity. In addition, the Custodian is entitled to be paid fees up to US$300 per account per annum and other incidental fees. All Custodian fees are included in other expenses on the Consolidated Statement of Comprehensive Income.

Auditors' remuneration

For the period ended 31 December 2016, the remuneration for work carried out for the by the statutory auditors, PricewaterhouseCoopers LLP was as follows:

Amounts are included in other expenses on the Consolidated Statement of Comprehensive Income.

11. TAXATION

Investment trust status

It is the intention of the Directors to conduct the affairs of the Group so as to satisfy the conditions for approval as an investment trust under section 1158 of the Corporation Taxes Act 2010. As an investment trust the Parent Company is exempt from corporation tax on capital gains made on investments. Although interest income received would ordinarily be subject to corporation tax, the Parent Company will receive relief from corporation tax relief to the extent that interest distributions are made to shareholders. It is the intention of the Parent Company to make sufficient interest distributions so that no corporation tax liability will arise in the Parent Company.

Any change in the Group's tax status or in taxation legislation generally could affect the value of the investments held by the Group, affect the Group's ability to provide returns to Shareholders, lead to the loss of investment trust status or alter the post-tax returns to Shareholders.

The following table presents the tax chargeable on the Group for the period ended 31 December 2016:

The following table presents the tax chargeable on the Group for the period ended 31 December 2015: