CFSL Integrated Report 2025

169

Introduction

Group Overview

Leadership

Strategy & Performance

Explanatory Notes 30 September 2025 4.

FINANCIAL RISK MANAGEMENT (CONTINUED) 4.1 Financial risk factors (continued) (d) Credit risk continued

The Group and Company held collaterals on finance lease which include heavy equipments, vehicles and other equipments. The fair value of collaterals of impaired lease facilities is estimated at MUR150.7m (2024: MUR217.8m). The Group and Company may recover amounts not settled by the debtors from the customers for factoring facilities with recourse while the non-recourse factoring facilities are insured. Other credit agreements and loans with exposure of MUR20,828m (2024: MUR18,316m) are mitigated by insurance covers which are directly linked to the facilities and entered at the same time of the credit origination. Other credit agreements also contain the right for the Group and Company to recover the collateral which the Group and Company estimated not to be significant at recovery. Loans and advances also contain the exposure in respect of credit cards not backed by collaterals. (e) Liquidity risk Liquidity risk is the risk that the Group will encounter difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or another financial asset. Liquidity risk arises because of the possibility that the Group and Company might be unable to meet its payment obligations when they fall due as a result of mismatches in the timing of the cash flows under both normal and stress circumstances. Such scenarios could occur when funding needed for illiquid asset positions is not available to the Group and Company on acceptable terms. To limit this risk, management has arranged for diversified funding sources including corporate bonds and keeping committed credit facilities with banks. The Group and Company also maintain a certain level of cash and deposits with banks to cater for its liquidity needs. Management monitors rolling forecasts of the liquidity reserve on the basis of expected cash flows. Contractual maturities of undiscounted cash flows of financial assets and liabilities

Up to 3 months

3 - 6 months

6 - 12 months

1 to 5 years

Over 5 years

GROUP

Total

30 September 2025 Assets Cash and bank balances

MUR m MUR m MUR m MUR m MUR m MUR m

943.6 253.4

–

–

–

– –

943.6 639.3

Deposits with banks

112.9

222.6

50.4

Net investment in leases and other credit agreements

2,024.3 2,857.7

1,757.3 1,588.3

3,173.2 2,887.8

8,990.3 10,775.8

624.7

16,569.8

Loans and advances Investment securities

– 18,109.6

0.9

– –

119.9

– –

0.8

121.6 560.9

Other assets*

560.9

–

–

Total assets

6,640.8

3,458.5

6,403.5

19,816.5

625.5

36,944.8

Liabilities Bank overdrafts

81.9

–

–

–

–

81.9

Other borrowed funds

3,561.9 1,042.0

1,765.7

2,972.1

11,696.9

0.3

19,996.9 1,255.9

Other liabilities Lease liabilities

87.0 13.7

38.6 24.8

88.3 83.1

– –

13.7

135.3

Total liabilities

4,699.5 1,941.3

1,866.4 1,592.1

3,035.5 3,368.0

11,868.3

0.3

21,470.0 15,474.8

Net liquidity surplus

7,948.2

625.2