General Capital Subsidiary Credit Rating Update

General Capital Limited
Level 8, General Capital House,
115 Queen Street, Auckland CBD
PO Box 1314, Shortland Street,
Auckland, New Zealand. 1140.
Phone +64 9 304 0145


Equifax affirms General Finance Limited’s BB Financial Strength Rating with
improved outlook

General Capital Limited is pleased to announce that global credit rating agency
Equifax Australasia Credit Rating Pty Ltd (Equifax) has affirmed the financial strength
rating of General Capital’s 100% owned subsidiary, General Finance Limited, at BB.
This follows a review of its six-monthly audited accounts to 30 September 2025.

The outlook for the credit rating has been revised upwards from ‘Stable’ to ‘Positive’,
based on Equifax’s expectation of continued improvement in General Finance’s
operating performance, supported by loan book and deposits growth, and
maintenance of healthy profitability.

Mr. Brent King, Managing Director, said, “We welcome the affirmation of the General
Finance credit rating. We are especially pleased with the revision of the outlook from
stable to positive. General Finance has benefited from the introduction of the DCS on
1 July 2025 which has driven strong deposit growth. This, supported by strong lending
growth, prudent credit control and a focus on costs, has resulted in strong profitability
despite the ongoing economic challenges being faced by the New Zealand economy”.

Mr. King went on to say “General Finance has its accounts audited every 6 months and
our credit rating is reviewed shortly thereafter by Equifax. This gives our investors
increased confidence”.

ENDS

This announcement has been authorised by Brent King, Managing Director, General
Capital Limited.

For further information contact:

Brent King
Managing Director
General Capital Limited
+64 21 632 660
Brent.King@gencap.co.nz

18 December 2025

---

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Credit Rating Synopsis
Date: 10 December 2025
Prepared for: General Finance Limited
Report prepared by: Equifax Australasia Credit Ratings Pty Ltd (“Equifax”)
Primary Analyst: Brock Ackerley, BCom
Secondary Analyst: Paul Gao, Ph.D.
Job Number: 406175

Currency used in this report: This report is presented in New Zealand Dollars unless otherwise noted.
General Finance Limited
NZBN: 9429038072994

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Contents
Contents ........................................................................................................................................................................................... 2
1. Executive Summary................................................................................................................................................................ 3
2. Scope of Report ........................................................................................................................................................................... 4

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1. Executive Summary
General Finance Limited (“GF”, “the Company”)
Risk Rating
GF is a Non-Bank Deposit Taking (NBDT) organisation that is licenced by the Reserve Bank of New Zealand (the RBNZ) and domiciled in New
Zealand (‘NZ’). The Company offers secured and unsecured lending and accepts customer deposits.

Equifax Credit Ratings Australasia Pty Ltd (‘Equifax’) has affirmed GF’s credit rating of ‘BB’ at Sep25, which is a near-prime classification with a
low to moderate level of risk. The outlook for the rating has been revised to ‘Positive’ from ‘Stable’, predicated on our expectation of continued
improvement in the Company’s operating performance, supported by loan book and deposits growth, and maintenance of healthy profitability.
GF’s credit rating benefits from its healthy competitive position as a specialised bridging loans provider, its loan book and deposits growth,
healthy earnings, sound capital and funding profile, and benefit to its ability to attract deposits by regulatory reforms. The risks to GF’s credit
rating arise from the challenging macroeconomic environment and GF’s business model risks (which include market risk factors and a moderate
degree of concentration risks) posing a threat to asset quality, potential income pressures from a challenging operating environment with low
interest rates and changing prudential requirements, as well as a high reliance on key executives’ expertise, thereby exposing it to keyperson
and business continuity risks.

Strengths

- GF’s healthy competitive position is supported by its long trading history as a specialist bridging loans provider catering to a market
underserved by many industry competitors. It is further evidenced by a rapid growth experienced by the Company’s loan book between Mar22
($80.2m) and Sep25 ($206.6m) with a compound annual growth rate (CAGR) of 23.4%.

- GF has maintained a healthy level of operating flexibility over the period under review, with healthy reported net interest margins (NIMs),
better than industry operating efficiency (evidenced by a better-than-sector Cost-to-Income ratio), and healthy Return on Equity (1HFY26:
10.0%; FY25: 15.1%; FY24: 16.5%).

- GF has reported growth in its core business during 1HFY26, evidenced by increased loan book (Sep25: $206.6m; Mar25: $151.5m) and
deposits (Sep25: $240.0m; Mar25: $184.7m). GF’s demonstrated capacity to attract deposits, supports its healthy funding and liquidity profile.
At Sep25, the Company reported cash reserves of $62.0m (Mar25: $57.8m), which were equivalent to 25.8% of its deposit base (Mar25:
31.3%), supporting the Company’s capacity to meet obligations, and fund future organic/inorganic growth objectives.

- A healthy, albeit reduced, capital ratio of 15.3% at Sep25 (Mar25: 17.8%) enables GF to maintain adequate headroom above the regulatory
minimum capital ratio threshold (8.0%). The Company’s capitalisation has been supported by earnings retention along with incremental capital
injection. This holds GF in good stead to support future loan book growth and/or withstand some moderate shocks. The decrease in the capital
ratio was impacted by the recent (Nov24) addition of unsecured loans (insurance premium lending) in GF’s portfolio, that carry a higher risk
weight. That said, the acquisition of the insurance premium lending business improves diversification and supports the liquidity profile of GF.
Further, management are considering for securitisation of the insurance premium loans, which is expected to benefit its capital ratio in the
near-term.

- RBNZ is in the process of aligning the regulation of all deposit takers under the Deposit Takers Act 2023 (‘DTA’), which will take full effect in
2028. More stringent regulatory oversight of NBDTs may promote public confidence in the sector and lead to general reduction in deposit
costs for NBDTs such as GF. The DTA introduces a depositor compensation scheme (DCS) which has come into effect in July 2025 (insuring
deposits up to $100k). The resulting increased deposit flows, particularly towards NBDT finance companies, has allowed them to reduce their
funding rates, consequently narrowing the risk-premium funding spread between banks and NBDTs.

Constraints

- While GF has so far successfully navigated macroeconomic headwinds, its operations inherently remain exposed to general economic
volatility and downturns, highlighting a persistent risk factor. This challenging environment is primarily driven by subdued economic activity
across the wider NZ economy and a sluggish property market impacted by a relatively high unemployment rate, subdued construction activity,
and weaker consumer confidence. Although the current performance of the loan book is considered satisfactory, evidenced by a reduced
amount of loans in arrears (Sep25: 3.8%; Mar25: 6.3%; Mar24: 7.8%), low impaired loans and credit loss ratio, the challenging market
environment and potential shrinking of existing and/or future collateral cover due to the subdued property market, puts pressure on the loan
value ratio (LVR) of existing loans and may constrain the Company’s ability to continually grow in accordance with the management’s
conservative lending approach that focuses on lower LVR loans. These risks are to some degree exacerbated by GF’s moderate to high
concentration to a few larger borrowers with the top 10 loans accounting for 22.7% of GF’s loan book at Sep25 (Mar25: 21.7%).

- GF’s healthy profitability is expected to be challenged by both market and regulatory pressures. The current low-interest rate environment
intensifies competition to deploy funds, which may place downward pressure on loan yields, potentially leading to NIM compression and
reduced profitability. Furthermore, elevated overheads due to increased regulatory requirements associated with the DTA, including
unforeseen transition cost and ongoing levy payments, has the potential to place additional pressure on overall operating margins, making it
challenging to sustain current profitability levels. Moreover, the required investment to scale up IT infrastructure for GF’s planned expansion
of the insurance premium loan portfolio may also constrain short-term profitability.

- GF has a high dependence on its Managing Director, Mr. Brent King, which exposes business operations to keyperson risks. As the public face
of the Company, Mr. King has an active involvement in regulatory developments, liaises with key stakeholders and lends his commercial
expertise and business acumen as the final sign-off authority for all property loans. In our view, GF’s ability to execute its future growth
strategy and successfully navigate through a challenging macroeconomic environment has a high reliance on Mr. King’s expertise. That being
said, current GF staff have upskilled with experience in the business and new qualifications, and we note the relatively recent appointments of
new CFO who has extensive global banking and financial services experience, and the Head of Corporate Finance who has significant corporate
finance and banking experience, to assist the business and decrease reliance on Mr. King, to some degree.

The outlook for the rating is currently ‘Positive’. An upgrade would require a demonstrated sustained improvement in scale and market position,
while maintaining profitability and asset quality, and material reduction in keyperson and business continuity risks through an increase in the
pool of key executives. The rating may be revised downward if there is material deterioration in either GF’s earnings, scale or asset quality.

BB
Outlook: Positive
Type: Public, Monitored
Industry Percentiles






*Annualised







Key Trends

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2. Scope of Report

The purpose of this report is to provide a Credit Rating Synopsis on General Finance Limited (“GF”, “the
Company”).
We have complied with our rating services guidelines in order to derive the credit rating on General Finance
Limited. The credit ratings and observations contained herein are solely statements of opinion and not
statements of fact or recommendations to purchase, hold or sell any securities or make any other investment
decisions. The details pertaining to this report are outlined below:

Report Details
Date of Report 10
th
December 2025
Request Type Issuer
Assessment Type Under Ongoing Monitoring
Rating Initiation Issuer based (solicited)
Rating Distribution Public Rating
Report Distribution Unrestricted
Purchased by General Finance Limited
Report Fee Fixed Price
Ancillary fees Nil
Issuer Name General Finance Limited
Issue Name Not Applicable
Issuer First Time Rated No
Issue First Time Rated Not Applicable
Financial Scope Standalone Entity
Structure Limited Company
Industry Financial Services

Sector Non-Bank Deposit Takers


This report should be read within the context of Corporate Scorecard’s Rating Services Guide. This Report should
be taken as a whole and cannot be abridged or excerpted for any reason.

We have conducted this assessment on the basis of the information provided to us by General Finance Limited,
publicly available information and from our own enquiries. We have derived a credit rating on the Company
based on the understanding that General Finance Limited has no contingent liabilities, cross guarantees or other
liabilities to any other entity other than as disclosed to us or as detailed in the financial statements. Our duty
does not include auditing the financial statements.

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Information Sources
Financial statements
Audited Interim Financial Statements for the 6-month period
ended 30 September 2025.

Audited Financial Statements for the years ended 31 March
2025, 2024, and 2023.
Name of auditor
Grant Thornton New Zealand Audit Limited
Other Information Sources
The Company’s response to our Request for Information, the
Company’s website, industry and regulatory websites,
management interviews, media articles, adverse searches
and internet searches.
Subject participation Full
Material financial adjustments None
Limitations of assessment None
Outsourced rating activities No
Confidentiality agreement No
Material client No
Rating amended post issuer disclosure No
Potential conflict of interest
GF is also a user of other Equifax products which are procured
on commercial terms.
Rating methodology Financial Institution Rating Criteria


This report should be read within the context of Equifax’s Ratings Services Guide.

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APPENDICES
1. Explanation of the Equifax’s credit rating

1.1 What is a rating?

Credit ratings provide an Agency's opinion as to the capacity, viability and willingness of an entity, issuer, or
counterparty to meet their respective financial commitments. As such, Equifax assigns ratings based on the credit
worthiness of an entity, commitment, or product, and provides probabilistic assessments of default over the
short, medium, and long-term.

Credit ratings are a critical measure used extensively in commercial, financial, and capital markets to support key
business decisions. Equifax’s credit ratings are used to support debt and bonding decisions, loan origination and
recovery, insurance and warranty, funds management, portfolio management, tendering and procurement,
counterparty risk assessments and other commercial contracts.

Equifax provides credit ratings on government and commercial agencies, international conglomerates,
infrastructure consortia, financial institutions, publicly listed entities, private corporations, and small-to-medium
sized enterprises across a range of industry sectors both domestically and internationally. As such, Equifax is also
able to provide detailed industry intelligence, benchmarking reports and analysis across a wide range of sectors.

1.2 Equifax’s credit rating

Equifax and other credit rating agencies all attempt to measure the probability of an entity being able to honour
its financial commitments as and when they fall due. The most recognised credit rating is that based on Bond
Rating Equivalents (BRE) used over the past eighty years to determine the proximity of an entity’s securities to
default (non-payment of interest or principal). The accuracy of this method has been extensively tested and is
accepted worldwide.

The Equifax’s database contains more than 100,000 financial years of information spanning more than twenty-
five years. As such Equifax is in a unique position, having developed a large and empirical data source on entities
across various industry sectors with long data histories covering a range of economic conditions and one or more
complete business cycles. Equifax has therefore been able to use a variety of quantitative validation tools and
comparisons using this information to adequately verify the stability, accuracy, and consistency of its rating
models.

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Equifax’s rating models have been designed to assess the proximity of an entity to defaulting on its financial
commitments and obligations. Proprietary risk analytics are used to evaluate the multivariate interrelationship
of key risk indicators using scientifically based and empirically derived risk metrics. These models evaluate the
financial performance, position, and profile of an entity in the context of its industry, size, and structure. They
have been validated on Australian and international data with the assistance of Professor Edward Altman, an
internationally recognised leader in the field of credit risk analysis and bankruptcy prediction.

Equifax uses its comprehensive benchmarking database to evaluate the financial position, performance and
credit quality of an agency, institution, corporation, or entity relative to an industry and its peers. This enables
the identification of key sensitivities, trends, cautionary alerts, and exception reports based on identified
anomalies and/or outliers across key credit indicators of a select benchmarking group.

While there is no single method to discriminate unambiguously between firms that will default and those that
will not, Equifax can make probabilistic assessments of default. This requires a large database of actual defaults
to enable an assessment of default probabilities and actual default rates from empirical evidence. The
Australasian market has a comparatively small number of corporate bond issues and a relatively benign credit
climate over recent decades, and as such empirical data on Australian default rates is limited. Therefore, Equifax
considers it is more appropriate to apply default probabilities using empirical data from international markets
over several economic cycles.

Equifax’s default statistics have been derived from nearly twenty years’ experience analysing mainly US non-
financial, non-utility corporate bond issuers. The analysis covered a relatively large number of companies
(approximately 1,000 rated each year) and follows the well-established static pool approach used by Credit Rating
Agencies to report their default experience. Static pools were created for bond issuers each year by both notch
and grade, and the history of these bond issuers was then analysed over the period. The pools were then
combined so that long-term average default experience by duration could be calculated, and both annual and
cumulative default experience was calculated from the pools.

Equifax’s risk analytics enable analysts to evaluate the most critical and sensitive financial and risk items through
the Risk Assessment Platform by analysing key indicators to derive a definitive credit risk score and Bond Rating
Equivalent (BRE), providing Probabilities of Default (PoD) over the short-, medium- and long-term horizon.

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1.3 Rating Definitions

Credit ratings provide an Agency's opinion as to the capacity, viability, and willingness of an entity to meet their
respective financial and contractual commitments. As such credit ratings are assigned in accordance with the
entity, commitment, or product's proximity to default. Equifax adheres to internationally recognised grades and
are similar to other agency classifications, providing ratings across twenty-two credit notches from ‘D’ (in default)
to ‘AAA’ (extremely strong).

Moody’s Fitch S&P
Rating Default rates
(5 years)
Classification Risk Level
Aaa AAA AAA AAA 0.17
High Grade

Negligible
Aa1 AA+ AA+ AA+
0.31
Aa2 AA AA AA 0.44
Aa3 AA- AA- AA- 0.55
A1 A+ A+ A+ 0.76
Investment Grade

Very Low
A2 A A A 0.81
A3 A- A- A- 1.47
Baa1 BBB+ BBB+ BBB+
2.08
Low
Baa2 BBB BBB BBB 3.19
Baa3 BBB- BBB- BBB- 4.37
Ba1 BB+ BB+ BB+
7.13
Near Prime

Low to Moderate
Ba2 BB BB BB 7.49
Ba3 BB- BB- BB-
10.52
B1 B+ B+ B+
16.34
Sub Prime

Moderate
B2 B B B
22.21
B3 B- B- B- 24.16 High
Caa1
CCC
CCC+ CCC+ 28.16
Credit
Watch

Very High
Caa2 CCC CCC 29.90
Caa3 CCC- CCC- 39.16
Ca
CC CC 52.87
Distressed

Extremely High
C C 55.00
C
D
D D 100.00

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Equifax assigns ratings based on the credit worthiness of an entity or a specific financial commitment, and
provides probabilistic assessments of default over the short, medium, and long-term. Every entity or
commitment has some probability of default over a period of time, even those assigned with the strongest of
ratings. An Investment Grade classification is attributed to credits that exhibit a lower probability of default, while
a Sub-Prime classification has a greater expectancy of default.

An Equifax’s credit rating may also be assigned additional clarification markers (symbols) to qualify the credit risk
assessment. These may include:

Conditional Rating (#)
A Conditional Rating is used where Equifax has rated an entity on the basis of significant risk factors and/or report
qualifications, with recommendations providing one or more conditions precedent and/or mitigation action(s) to
reduce identified uncertainty and risk.

Provisional Rating (*)
A Provisional Rating is used when the most recent financial figures are based on draft management accounts or
are deemed out-of-date. Entities with a provisional rating should be re-evaluated as soon as finalised financial
statements become available.

Indicative Rating (^)
An Indicative Rating is used where Equifax is engaged to conduct preliminary analysis only, and as such an official
rating assignment would require a more detailed and comprehensive investigation and due diligence assessment
prior to the provision of our professional opinion.

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1.4 Rating Outlooks

Equifax’s forward estimates help ascertain the trajectory of ratings as well as the risks to ratings. Ratings with a
positive trajectory are assigned ‘Positive Outlooks’. Ratings with a negative trajectory are assigned ‘Negative
Outlooks’. Where Ratings are expected to remain unchanged, a ‘Stable Outlook’ assigned.

Rating trajectories are closely related to the outlook for the corporate’s earnings. Earnings growth that is within
sustainable growth parameters together with an attenuation of earnings volatility provide upward rating
pressure and so may warrant the assignment of a Positive Outlook.

Credit Concepts measured

The main credit concepts measured against Australian and New Zealand Standard Industry Classifications
(ANZSIC) and specific Peer Groups based on entity size are available in Corporate Scorecard’s Rating
methodology, which can be found at the below-mentioned links

http://www.corporatescorecard.co.nz/services_credit_ratings.php
https://www.corporatescorecard.co.nz/docs/RatingMethodologyFinancial.pdf

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2. Regulatory Disclosures and Disclaimer

Equifax Australasia Credit Ratings Pty Ltd (Equifax Credit Ratings) is a credit rating agency regulated by the
Reserve Bank of New Zealand. The licensing regime addresses a range of matters including the quality and
integrity of the ratings process, independence and avoidance of conflict of interest, and responsibilities to
the public, clients and assessed entities. The regime also covers confidentiality, communication and
disclosure, professional development, document management, and a range of governance related matters.
Financial, operational and compliance audits are conducted by external, independent auditors each year.

Equifax Credit Ratings also holds an Australian Financial Services License (AFS License no. 341391) which
licenses it to provide credit ratings to wholesale clients in Australia.

The credit rating issued by Equifax Credit Ratings reflects our current opinion of the relative credit risk of
the institution. This opinion has been formed in accordance with Equifax’s published credit ratings
methodology - financial institution rating criteria (version 7, 2020).
https://www.corporatescorecard.co.nz/docs/RatingMethodologyFinancial.pdf

The credit rating and associated assessments, opinions and observations are solely statements of opinion.
They are not statements of fact. They do not constitute advice or a recommendation. The credit rating does
not guarantee the performance of the rated issuer or relevant security, and should not be relied on for the
purposes of making an investment decision. All information used in the credit rating process is obtained by
Equifax from sources believed by it to be accurate and reliable. Equifax adopts all necessary measures so
the information used in assigning a credit rating is of sufficient quality and from sources believed to be
reliable including, when appropriate, independent third-party sources. However, because of the existence
of human or system error, or other factors, all information contained herein is provided ‘as is’ without
warranty of any kind. Equifax is not an auditor and cannot in every instance independently verify or validate
information received in the rating process. Use of information contained in this report is at the recipients
own risk. To the extent permitted by law, Equifax, its directors, officers, employees and any persons
associated with the preparation of the release and our full report are not liable to any person in respect of
anything (or the consequences of anything) done or omitted to be done by any person in reliance on any of
the contents of the release or our full report; and are not responsible for any errors or omissions in the
release or our full report resulting from any inaccuracy, mis-description or incompleteness of the
information provided or from assumptions made or opinions reached by the parties providing the
Information. All information contained herein is protected by law, including but not limited to copyright law,
and this information may not be copied or otherwise reproduced, repackaged, further transmitted,

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transferred, disseminated, redistributed or resold, or stored for subsequent use for any such purpose, in
whole or in part, in any form or manner or by any means whatsoever, by any person without Equifax’s prior
written consent.

For Australia only: Any publication into Australia of this document is pursuant to the Australian Financial
Services License of Equifax Australasia Credit Ratings Pty Ltd [AFSL #341391]. This document is intended to
be provided only to ‘wholesale clients’ within the meaning provided by the Corporations Act 2001. By
continuing to access this document from within Australia, you represent to Equifax that you are, or are
accessing the document as a representative of, a ‘wholesale client’ and that neither you nor the entity you
represent will directly or indirectly disseminate this document or its contents to ‘retail clients’ within the
meaning of the Corporations Act 2001. Equifax’s credit rating is an opinion as to the creditworthiness of an
issuer, not on the equity securities of the issuer or any form of security that is available to retail clients. It
would be inappropriate for ‘retail clients’ to make any investment decision based on Equifax’s credit rating,
and Equifax recommends you consult with your financial or other professional adviser.

Please refer to http://corporatescorecard.com.au/services_credit_ratings.php for further information and
additional regulatory disclosures, including our code of conduct, published ratings, criteria and
methodologies.