Share Name Share Symbol Market Type Share ISIN Share Description
Polar Capital Global Financials Trust Plc LSE:PCFT London Ordinary Share GB00B9XQT119 ORD 5P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  -3.50 -2.27% 150.50 150.50 152.50 154.00 151.00 151.50 715,187 16:35:00
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Equity Investment Instruments 6.3 5.3 3.0 50.0 186

Polar Capital Global Financials Tst Final Results

23/02/2021 7:00am

UK Regulatory (RNS & others)

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RNS Number : 9632P

Polar Capital Global Financials Tst

23 February 2021


Legal Entity Identifier: 549300G5SWN8EP2P4U41


30 NOVEMBER 2020


                                                                For the year 
                                                            30 November 2020  Since Inception 
Performance (Sterling total return)                                        %                % 
---------------------------------------------------------  -----------------  --------------- 
Net asset value (NAV) per ordinary share (1)*                           -6.5             73.4 
Ordinary share price (2)*                                               -1.6             69.3 
Ordinary share price including subscription 
 share value (3)*                                                          -             73.0 
---------------------------------------------------------  -----------------  --------------- 
 MSCI World Financials + Real Estate / MSCI ACWI 
 Financials (in Sterling) (4)                                           -6.4             73.3 
---------------------------------------------------------  -----------------  --------------- 
Other Indices and peer group (in Sterling) 
MSCI World Index                                                        10.9            134.4 
FTSE All Share Index                                                   -10.3             38.6 
Lipper Financial Sector (5)                                             -2.9             56.4 
---------------------------------------------------------  -----------------  --------------- 
Performance since Restructuring on 22 April                             Since Restructuring % 
 2020 (Sterling total return) 
---------------------------------------------------------  ---------------------------------- 
Net asset value per ordinary share (6)*                                                  33.3 
Benchmark (4)                                                                            23.3 
                                                    As at              As at 
                                              30 November        30 November                % 
Financials                                           2020               2019           Change 
--------------------------------------  -----------------  -----------------  --------------- 
Total net assets                           GBP165,743,000     GBP301,170,000            -45.0 
Net asset value per ordinary share                 134.7p             148.5p             -9.3 
Ordinary share price                               136.5p             143.8p             -5.1 
Premium/(discount) per ordinary 
 share*                                              1.3%              -3.2% 
Net gearing*                                        12.7%               4.4% 
Ordinary shares in issue (excluding 
 those held in treasury                       123,050,100        202,775,000            -39.3 
Ordinary shares held in treasury               79,724,900                  -                - 
Total dividend per ordinary share                   4.40p              4.40p                - 
--------------------------------------  -----------------  -----------------  --------------- 
                                             For the year       For the year 
                                                    ended              ended 
Earnings per Ordinary share              30 November 2020   30 November 2019 
--------------------------------------  -----------------  -----------------  --------------- 
Revenue Return                                      3.01p              4.89p 
Capital Return                                   (33.01p)              9.36p 
--------------------------------------  -----------------  -----------------  --------------- 
Total                                            (30.00p)             14.25p 
--------------------------------------  -----------------  -----------------  --------------- 
--------------------------------------  -----------------  -----------------  --------------- 
Ongoing Charges (7)*                                1.09%              1.04% 
Ongoing charges including performance 
 fee (7)*                                           1.74%              1.04% 
--------------------------------------  -----------------  -----------------  --------------- 


The Company has paid or declared the following dividends relating to the financial year ended 30 November 2020 :

                      Amount per 
Pay date                   share        Record date            Ex-date      Declared Date 
--------------------  ----------  -----------------  -----------------  ----------------- 
First interim:             2.40p      7 August 2020      6 August 2020       30 June 2020 
 28 August 2020 
Second interim:            2.00p 
 26 February 2021                   29 January 2021    28 January 2021    20 January 2021 
--------------------  ----------  -----------------  -----------------  ----------------- 
Total (2019: 4.40p)        4.40p 
--------------------  ----------  -----------------  -----------------  ----------------- 

Note 1

The total return NAV performance for the period is calculated by reinvesting the dividends in the assets of the Company from the relevant ex-dividend date. Performance since inception has been calculated using the initial NAV of 98p and the NAV on 30 November 2020. Dividends are deemed to be reinvested on the ex-dividend date as this is the protocol used by the Company's benchmark and other indices.

Note 2

The total return share price performance is calculated by reinvesting the dividends in the shares of the Company from the relevant ex-dividend date. Performance since inception has been calculated using the launch price of 100p to the closing price on 30 November 2020.

Note 3

The total return share price performance since inception includes the value of the subscription shares issued free of payment at launch on the basis of one for every five Ordinary shares and assumes such were held throughout the period from launch to the final conversion date of 31 July 2017. Performance is calculated by reinvesting the dividends in the shares of the Company from the relevant ex-dividend date and uses the launch price of 100p per Ordinary share and the closing price per Ordinary share on 30 November 2020.

Note 4

The benchmark changed on 23 April 2020 to MSCI ACWI Financials Net Total Return Index (in Sterling) due to the Company's exposure to emerging market financials equities and its limited exposure to real estate equities. Prior to this the Company's benchmark was MSCI World Financials + Real Estate Net Total Return Index. Preceding 31 August 2016, the Company's benchmark was the MSCI World Financials Index, which included Real Estate as a constituent until its removal that year. The benchmark performance above illustrates linked performance of these benchmarks.

Note 5

Dynamic average of open ended funds in the Lipper Financial Sector Universe which comprised 51 open ended funds in the year under review.

Note 6

The total return NAV performance for the year is calculated by reinvesting the dividends in the assets of the Company from the relevant ex-dividend date. The new performance fee period runs from the date of the reconstruction of the Company on 22 April 2020. The opening NAV for the performance fee of 102.8p is the closing NAV the night before the tender offer was completed.

Note 7

Ongoing charges represents the total expenses of the Company, excluding finance costs, expressed as a percentage of the average daily net asset value, calculated in accordance with AIC guidance issued in May 2012. From 3 January 2018, the date of implementation of the MiFID II regulation, the research cost borne by the Company is included in the ongoing charges calculation.

*See Alternative Performance Measure provided in the Annual Report.

Data sourced by HSBC Securities Services Limited, Polar Capital LLP and Lipper.

Status of Announcement

The figures and financial information contained in this announcement are extracted from the Audited Annual Report for the year ended 30 November 2020 and do not constitute statutory accounts for the year. The Annual Report and Financial Statements include the Report of the Independent Auditors which is unqualified and does not contain a statement under either section 498(2) or Section 498(3) of the Companies Act 2006.

The Annual Report and Financial Statements for the year ended 30 November 2020 have not yet been delivered to the Registrar of Companies. The figures and financial information for the year ended 30 November 2019 are extracted from the published Annual Report and Financial Statements for the year ended 30 November 2019 and do not constitute the statutory accounts for that year. The Annual Report and Financial Statements for the year ended 30 November 2019 have been delivered to the Registrar of Companies and included the Report of the Independent Auditors which was unqualified and did not contain a statement under either section 498(2) or Section 498(3) of the Companies Act 2006.

The Directors' Remuneration Report and certain other helpful shareholder information has not been included in this announcement but forms part of the Annual Report which will shortly be available on the Company's website and will be sent to shareholders in March 2021.

National Storage Mechanism

A copy of the Annual Report has been submitted to the National Storage Mechanism ('NSM') and will shortly be available for inspection at

Neither the contents of the Company's website nor the contents of any website accessible from the hyperlinks on the Company's website (or any other website) is incorporated into or forms part of this announcement.


" It would be difficult to exaggerate when I describe the period on which I report as extraordinary."

Dear Shareholders

In the space of a year we have witnessed a lethal viral pandemic take a grip on lives and livelihoods globally; an economic depression on a scale not seen in our lifetimes; unimaginable levels of monetary and fiscal life support from policy makers around the world; the appearance of negative interest rates challenging traditional financial and investment models; a seemingly endless US election drama that has raised the spectre of civil disobedience in a world superpower; and a whole new way of living, working and communicating.

At the time of writing last year's Chairman's Statement these were barely imaginable possibilities. It was in the eye of the subsequent tempest that shareholders were asked to support a restructuring of the Company as its seven-year fixed term life came to an end. Shareholders unanimously approved the Board's proposal to replace the seven-year fixed life of the Company with a rolling five year full tender offer despite the very adverse background for Financials through the spring and summer which significantly impaired sentiment towards the sector. This resulted in a 39.1% take up of the tender offer at the time of the Company's reconstruction and the need for the Company to subsequently support the market in its shares on a number of occasions through share buy backs.

Despite these most severe headwinds, I am pleased to report that the Company has been able to maintain its dividend, partly through the use of revenue reserves. In a very encouraging sign for the future, the end of the financial year witnessed a positive swing in sentiment towards the financials sector. This not only brought about a sharp rise in the Company's NAV, but also a strong rally in the Company's share price to the point that it began to trade at a premium to the underlying NAV. On a positive endnote to an otherwise challenging year under review, demand for the Company's stock at the end of November was such that the Board authorised the reissue of shares from treasury at a premium to NAV. Further reissues have continued into the first three months of the new financial year.

Restructuring of the Company

For the Company the most significant development during the financial year was its reconstruction. With the end of the seven-year fixed life term approaching in May 2020 and following discussions with a number of large shareholders, the Board drew up proposals for a 100% tender offer and the replacement of the fixed end-of-life with five-yearly tender offers that would give shareholders the periodic opportunity to tender their shares at close to net asset value.

Despite the fact that these proposals were put to shareholders at a time of maximum negative sentiment that over shadowed the financials sector following the COVID-19 outbreak, the proposals were passed by 100% of the votes cast at a General Meeting in April 2020. In addition shareholders representing 60.9% of the issued share capital chose to remain invested. The tender closed on 22 April 2020 at a tender share price of 102.02p with 79,159,235 shares, representing 39.1% of the issued share capital, bought and placed into treasury by the Company.


The investment environment in 2020 presented unique and profound challenges. Not only did investors have to evaluate a black swan event in the form of a global pandemic, they also had to react to radical and fundamental changes in the conduct of public policy and in the very way of life. The hospitality and travel sectors were at times shut down; working from home replaced the daily commute; virtual conferencing replaced handshakes and face-to-face meetings; digital transactions replaced cash, and crypto began to look like a credible alternative to traditional currencies.

Against this background, the overall direction of market indices was no longer a good guide to understanding investment performance. Global equity markets exhibited a schizophrenic response to the impact of COVID-19. What primarily drove absolute returns was whether you held 'COVID winners' or 'COVID losers'.

Much of the financials sector appeared to be placed in the latter category. Sentiment, in particular towards banks - already fragile before the pandemic - quickly sunk to depressed levels. It was feared that the appearance of negative interest rates and the expected impact on the ability to repay loans would tax the earnings and capital buffers of the banks; other sectors, such as asset managers and insurers, would have to deal with the expected impact of a global recession on asset values and claims for losses.

At the time of the restructuring, the Company's performance benchmark was changed from the MSCI World Financials + Real Estate Net Total Return Index to the MSCI ACWI Financials Net Total Return Index. This change was made in order to adopt a benchmark that represented more closely the Company's investment strategy which included exposure to emerging markets, and reflected the fact that real estate presented a tactical not strategic opportunity for the Company. For this reason the performance of the portfolio is measured against a "chain linked" benchmark for the year under review, reflecting both the former and the new

benchmark on a time-weighted basis.

Over the financial year, while the MSCI World Index rose by 10.9% in sterling terms, the Company's chain linked benchmark fell by 6.4%, mirroring the decline in the portfolio's total return NAV. As the Manager's report highlights, this headline number understates the wild swings in sentiment the sector experienced over the year. The Company's former benchmark fell by over 30% from the

start of the financial year to late March, before recovering more than 35% to the end of the financial year, most of which came in the year's last few weeks.

These were indeed treacherous waters to navigate as an investment manager, with potential traps and pitfalls that tested the skills and temperament of the very best. Unsurprisingly, as the black swan event unfolded - by definition difficult to predict and difficult to analyse as they follow no known template - the portfolio underperformed during the initial heavy market sell-off. However, the Manager responded very well, positioning the portfolio to benefit from a recovery in sentiment and to exploit depressed valuations. This has included increasing exposure to Asia, which has been resilient to the pandemic and its economic consequences, and by using the Manager's discretion to leverage the portfolio.

Over the life of the Company the Manager has shown a consistent ability to add value through stock selection and this again contributed positively to this year's performance. Payments companies, stock exchanges and asset managers were some of the portfolio's strongest performers, while holdings of banks and non-life insurers were hit by pandemic concerns over their business models but enjoyed a late rally as the recovery in market sentiment took hold. The Board wishes to thank the Manager for their excellent management of the portfolio through the tender offer, acting in the interests of both departing and remaining shareholders in what was a highly volatile period.

Since the restructuring of the Company, the portfolio's total return had outperformed that of the new benchmark by 10% by the end of the financial year. As a result, and as approved at the General Meeting in April 2020 as part of the reconstruction proposals, the Manager had accrued a performance fee of GBP1,269,000 by the financial year end. The approved performance fee is calculated at 10% of the excess return over the performance fee hurdle of 1.5% per annum compounded annually. However, performance fees continue to be calculated daily based on cumulative relative performance and are not paid until the next tender offer. Further detail is provided in the Strategic Report.

The sharp improvement in sentiment towards the financial sector late in the year contributed to a strong recovery in the Company's ordinary share price. The Company's persistent share price discount to NAV disappeared by the end of the year, with the Company's shares moving to a small premium to NAV which has continued into the early part of the new financial year. As a result, for the year as a whole the ordinary share price total return fell by only 1.6% compared to a fall of 6.5% in NAV on a total return basis. The actions taken by the Company in response to the changing fortunes of its share price discount to NAV are discussed below.

Finally, as I announced at the very end of the financial year, the Board is pleased to welcome George Barrow as joint fund manager on the Company's portfolio, joining Nick Brind and John Yakas who have worked on the portfolio since the Company's inception. George has been with the Polar Capital Financials team since 2010 and the Board looks forward to George's dedicated focus as joint fund manager on the Trust.


Since the launch of the Company seven years ago the Company has been able to grow or maintain dividend pay-outs each year. At the same time the Company has built up income reserves in order to meet its objective of growing dividends even through difficult times. 2020 has certainly been one of those difficult times. The portfolio's ability to generate income from its investments has been impaired by the economic downturn and restrictions placed by regulators on the payment of dividends by certain financial institutions in Europe and the US in particular.

In the financial year under review the income generated by the portfolio fell by 48% from the preceding year following the decision by the regulators to make banks and some investee companies reduce or cancel dividends due to COVID-19. In addition, as part of the response to the dislocation caused by the COVID pandemic, the Manager repositioned the portfolio towards lower yielding stocks.

One of the advantages of the Company's Investment Trust structure is that it is able to smooth out the payment of dividends relative to the underlying portfolios earnings experiences. In July the Board announced a first dividend for the financial year of 2.4p paid on 28 August 2020. The Board has approved a further dividend payment for the financial year of 2.00p to be paid on 26 February 2021 to shareholders on the register as of 29 January 2021. This brings the total dividend for the year to 4.4p, the same level as that paid in the previous financial year, honouring the Board's commitment, made in an announcement on 4 May 2020, to maintain the Company's dividend in the 2020 financial year.

The Company has an income and growth mandate and the Board is aware of the importance of income to some shareholders as part of their total return. The Board will be careful to balance its objective of growing dividends for shareholders with sustainable earnings prospects and the availability of distributable reserves to support dividend payments. At the time of writing the financial and economic outlook remains highly uncertain. The Board, together with the Manager, will continue to assess the likely income

capability of the portfolio in a post COVID environment to determine the appropriate longer-term distribution level.

Share Capital Changes Following the Reconstruction

At the beginning of the financial year the number of ordinary shares in issue was 202,775,000. Following the closure of the tender offer in April 2020, 79,159,235 shares were bought back from shareholders and placed into treasury.

In accordance with the Board's commitment made at the time of the restructuring in April 2020 to provide support to the trading of the Company's shares if and when required, the Board stepped into the market on several occasions during the spring and summer to buy back shares. In total 670,000 shares were bought and placed into treasury between 16 March 2020 and 3 November 2020, at an average discount to the live NAV at the time of transaction of 11.6%. This was a period of poor sentiment towards the financials sector which caused the Company's share price to trade at a persistent discount to NAV, reaching 12.6% at its widest in late August.

The announcement in November of successful vaccine trials against COVID-19 triggered a sharp and dramatic positive change in sentiment towards 'COVID losers'. The financial sector was one of the principal beneficiaries of this change in mood. With many investors underweight in respect of financial stocks, investor interest in the Company's shares at first narrowed the discount sharply and eventually, towards the close of the financial year, a small share price premium to NAV appeared.

I stated at the time of the appointment of Stifel as our corporate broker in April, that together our focus would be on rebuilding the size of the Company and widening the breadth of the investor base by the re-issue of shares held in our treasury account as and when opportunities arise. To do so the Company's shares must be trading at a premium to NAV, such that NAV per share is enhanced.

The first such opportunity came on the very last day of the financial year when, in order to satisfy demand, the Company issued 104,335 ordinary shares from treasury at a premium of 1.3% to NAV. The impact of share buy backs and share issuance throughout the year meant that the Company closed its financial year with 123,050,100 ordinary shares in issue. All of the share buybacks and issuances have been NAV accretive for ordinary shareholders.

Given the recent strong interest in the financials sector and with most institutional and retail investors remaining significantly underweight, the Board was aware that investor appetite for its shares could exceed its remaining authority to allot new shares or reissue shares from treasury on a non-pre-emptive basis. The Board announced on 18 December 2020 it was considering asking shareholders for further issuance authority in view of its objective stated at the time of the restructuring to grow the Company when opportunities arose. Subsequent to this, a shareholder circular was published on 14 January 2021, and a General Meeting was held on 1 February. At the General Meeting, shareholders approved the resolution and the Company was given authority to re-issue all shares held in the treasury account, being 68,100,000 at the date of the meeting, into the market without applying pre-emption rights. Such authority will expire at the conclusion of the AGM to be held in 2022. Any such issues will be at a premium to NAV after costs.

In the weeks since the close of the financial year a total of 14,074,900 shares have been issued from treasury at a premium to NAV in order to satisfy demand for the Company's stock. Following these issuances 65,650,000 ordinary shares remain in treasury as at 22 February 2021.


The fixed implementation costs associated with the corporate action were absorbed by both the exiting and continuing shareholders with exit-only expenses being borne by the former. As a result of the corporate action the overall size of the Company is smaller. However, certain ongoing fixed expenses of the Company remain unchanged.

These expenses have been partly offset by the Manager agreeing to a reduction in their base fee from 0.85% per annum of the lower of the Company's market capitalisation and NAV to 0.70% per annum of Company's NAV. The Board has also worked with the Manager to ensure that any discretionary spending represents value for money for shareholders and the Board seeks to minimise ongoing expenses wherever possible.

Despite the management of expenses, the smaller size of the Company following the tender has led to a small rise in the ongoing charges ratio (OCR) from 1.04% in the 2018-19 financial year to 1.09% in 2019-20. This is the same level of costs incurred in the Company's first full financial year, 2013-14. It should be noted that the 2013-14 OCR did not include research costs charged through transaction commissions. These research costs are now charged separately and are fully reflected in the 2019-20 OCR and the charges to the capital account reduced accordingly through lower commission rates on transactions.

Given strong investment performance subsequent to the restructuring in April 2020 the Manager had accrued a performance fee by the financial year end which was reflected in the Net Asset Value. As a result the OCR including the accrued performance fee for the 2019-20 financial year was 1.74%. Any performance fee accrual can be reduced by any subsequent underperformance of the benchmark plus hurdle rate.

Environmental, Social and Governance (ESG)

The Board recognises that sustainability and good governance are now not only priorities for successful societies going forward, but are also drivers of successful investing. The Board has been working with the Manager to ensure that it incorporates ESG considerations in the way the Company behaves and operates. The Manager incorporates ESG factors into its investment process which is described in greater detail in the Manager's Report.

Board succession

The Board continues to believe that retaining Directors with sufficient experience of the Company, industry and financial markets is of benefit to shareholders while recognising that regular refreshment is equally of benefit and importance. Following shareholder approval to extend the Company's life indefinitely (subject to regular tender offers), the Board adopted a succession plan to refresh the Board. A managed programme of recruitment, appointment and retirement, including my role as Chairman, will be carried out from Spring 2021 with the expectation that such process will conclude by early 2023. Phase one of the refresh will begin with the appointment of a new Audit Committee Chair to replace Joanne Elliot as she comes to the end of her nine-year tenure on the Board. It is anticipated that the Audit Chair elect will be in place by November 2021, ahead of the Company's next audit to allow for an orderly and efficient handover process with the current Audit Chair.


As the global pandemic unfolded, markets at times feared the worst. For much of 2020 this was reflected in poor sentiment towards the financials sector, and in particular in the absolute and relative valuations of banks which reached levels last seen following the 2008 financial crisis.

The actual impact on the sector appears to be significantly less than these initial dire expectations. In addition certain sub-sectors and regions have benefitted from structural factors, for example the impact of the accelerated move to the digital economy on Fintech and payments services; or the economic resilience to, and recovery from the pandemic demonstrated by Asian economies.

The extraordinary global support response from monetary and fiscal policy makers to the pandemic has undoubtedly helped mitigate the impact on economies in general. Questions remain over the true underlying economic and financial damage that will be revealed once policy support is scaled back. However, for the key banking sector this support has also distracted attention from the significant and sustained underlying improvements made in balance sheet resilience and business models since the 2008 financial crisis.

The tightening of regulation on banks following the 2008 financial crisis has been a long term one-way trend that has helped strengthen balance sheets if not bottom lines. Capital resources and the quality of assets in banking systems in general are now in far better shape to withstand the impact of adverse scenarios than for many decades. 2020 presented a far worse adverse scenario than run in any stress tests and recovery plans. At first the market anticipated the worst in terms of the impact on loan losses, profitability and the adequacy of provisions.

However, pragmatic regulators have cushioned the impact by relaxing capital requirements and supporting profitability through, for example, Targeted Longer-term Refinancing Operations ("TLTROs"). In addition, the performance of loans themselves has been helped by targeted stimulus measures from policy makers. Restricted from paying dividends in many cases, banks have taken the opportunity to boost very significantly protection from loan losses by diverting profits to loan loss provisions. More recently regulators themselves have been sufficiently impressed by the resilience of their banking communities to the downturn and to further stress testing of balance sheets, to begin removing restrictions on dividend payments and share buybacks.

The near-term outlook for the financials sector is in large part a banking story. The release of excess capital trapped by regulators; long term improvements in asset quality temporarily hidden by loan deferrals and other government lending support programmes; very conservative loan loss provisioning that will turn into profits and dividends in better times; and the shift in business models from risk-based activities to more fee based and transaction services are yet to be recognised in valuations. The structural factors which support other financial sub-sectors are likely to persist on a return to normality, providing further opportunities for the Company's investment team to add value.

The scale of the policy response to the pandemic has been and continues to be extraordinary. The rule books on governmental fiscal discipline and monetary responsibility have been torn up, buoying equity prices and 'COVID winners' as well as all fixed income markets. Commentators and analysts speculate about the long term consequences but the way the financials sector responded to the announcement in November of the first successful vaccine trials clearly indicates that a return to some kind of normality will benefit sentiment towards an undervalued and largely ignored sector in general, and banks in particular.

As shareholders will be aware the government restrictions in relation to COVID-19 continue and, at the time of writing, we are unsure of how the situation will change over the coming months. For this reason we are again considering the safety of our shareholders as the primary concern and will be holding a closed-door AGM. The AGM will be held at 11am on Tuesday, 30 March 2021. Shareholders will not be permitted entry to the meeting. However, should the restrictions be lifted and we are able to hold an open-door meeting we will release a regulatory announcement and add details to the website.

We are conscious of the importance of shareholder engagement and would like to encourage shareholders to engage with the Board and the Investment Manager. As such, the Board invites shareholders to submit questions in writing to which we will respond, as far as possible, ahead of the AGM date. Please send your questions to cosec@ with the subject heading PCFT AGM. Ahead of the AGM we will also be uploading a short video from myself addressing the circumstances that have faced the Company over the year, how we managed the Company through the reconstruction and a note on performance and status up to the present day; the video will also encompass a presentation from the Investment Manager on the year under review and the outlook for the future. We will release an RNS announcement once the video is available.

Finally, on a personal note, I would l like to thank my fellow Directors and the many at Polar Capital who support the Company for their unwavering energy, commitment and dedication in rising to a set of challenges that none of us could have imagined or planned for. And to our shareholders I would like to extend the Board's appreciation for their support during a period in which the Company was tried and tested to the extreme, and extend our hopes that you may enjoy a healthy and rewarding year ahead.

Robert Kyprianou


22 February 2021



The period covered by this report was an extraordinary one for financial markets and the sector, reflecting the onset of COVID-19 and the response by governments and central banks to counteract its effects. Furthermore, the Company undertook a meaningful corporate action during the height of stock market turmoil. Against this background the Company's net asset value total return for the period was a loss of 6.5%, against a loss of 6.4% for the chain-linked benchmark. For comparison, our new benchmark index, the MSCI ACWI Financials Index fell by 8.2% while our old benchmark index, the MSCI World Financials Index + Real Estate Index fell by 8.0% over the financial year.

Following the reconstruction in April 2020, the benchmark index was changed to the MSCI ACWI Financials Index, to more closely reflect the strategy since IPO in 2013 of investing in emerging market financials, (which were not included in the old benchmark index), and the very limited exposure to real-estate securities, (which comprised 20% of the old benchmark index). The chain linked benchmark outperformed both the new and old benchmark indices and although the out turns for the year for both indices are very similar the underlying performance does not align over the period. The old benchmark index performed better in the run up to the corporate action, reflecting its lower weighting in banks. From the date of change, the new benchmark performed more strongly up to the end of November 2020, due to its higher weighting in banks. The investment review which follows explains how we positioned the portfolio to produce the outperformance in the latter period.

Performance of the Company vs benchmark indices over the year and since inception

                           22 April 2020    30 November   1 year              Since inception 
                                      to           2019 
                             30 November    to 22 April 
                                   2020*         2020** 
 NAV Total Return                  33.3%         -29.8%    -6.5%                        73.4% 
                          --------------  -------------  -------  --------------------------- 
 Chain-linked benchmark 
  TR                               23.3%         -24.1%    -6.4%                        73.3% 
                          --------------  -------------  -------  --------------------------- 
 MSCI ACWI Financials 
  Index TR                         23.3%         -25.6%    -8.2%                        64.8% 
                          --------------  -------------  -------  --------------------------- 
 MSCI World Financials 
  + Real Estate Index 
  TR                               21.2%         -24.1%    -8.0%                        70.3% 
                          --------------  -------------  -------  --------------------------- 

* Restructuring to year end

** Prior year end to corporate action

Figures are sterling total return calculated with dividends reinvested on ex-dividend dates. MSCI ACWI Financials Index is adjusted to exclude real estate securities prior to August 2016.

As illustrated by our new benchmark, Financials fell 32.3% from the end of November 2019 to their lowest level on 23 March 2020 before rallying 35.9% over the remainder of the financial year. The portfolio underperformed during the sell-off, but outperformed as equity markets and the sector recovered due in large part to the higher weighting in bank shares relative to our benchmark index but also the decision to reposition the portfolio. As in previous years, performance benefited from strong positive stock selection, partly offset by negative sector allocation. However, this year, regional allocation was a small positive contributor to performance as well.

Attribution analysis for year ended 30 November 2020

                 Allocation   Stock Selection   Currency effect              Total attribution 
                     effect            effect                                           effect 
 Subsector           -1.00%             4.03%            -1.28%                          1.75% 
                -----------  ----------------  ----------------  ----------------------------- 
 Geographical         0.21%             2.82%            -1.28%                          1.75% 
                -----------  ----------------  ----------------  ----------------------------- 

Analysis is compared to the chain-linked benchmark index.

Our bank holdings were the biggest drag on both the absolute and relative performance of the Company, with US and European banks being the hardest hit initially, as lockdowns were expected to have a significant impact on their earnings. The non-life insurance sector was also surprisingly weak despite its perceived defensive qualities. In particular, concerns around its exposure to business interruption and event cancellation insurance policies resulted in shares in the sector falling quite sharply.

Conversely stock exchanges, payment companies and some asset managers performed well as the former have been a beneficiary of the volatility in financial markets while lockdowns have benefited payments companies on the back of an acceleration of the growth in e-commerce. On a relative basis the biggest positive contributors to performance were all payments companies (Adyen, MasterCard and PayPal Holdings), while the biggest negative contributors to performance were American Tower Group (which was not held at year end), ING Groep and Arch Capital.

Investment Review


Despite the promising start to the financial year with equity markets rising in December 2019 on the back of optimism around trade talks between the US and China, financial markets fell in January 2020. The fall was initially due to rising tensions in the Middle East, following the assassination of Qasem Soleimani, the head of Iran's Revolutionary Guard. However, the assassination was quickly overshadowed by concern that the rapid spread of COVID-19 in China could have a significant impact on global growth.

While containment policies in China and elsewhere in Asia quickly appeared to be containing the virus, its spread to other countries led to a domino of lockdowns globally as governments tried to reduce the impact of COVID-19 on healthcare systems. As a result, financial markets suffered a brutal sell-off towards the end of February 2020 into the middle of March 2020, exacerbated by a sharp fall in the oil price following the breakdown of talks between Saudi Arabia and Russia which also knocked sentiment.

The response by central banks was very swift in cutting interest rates and injecting significant amounts of liquidity into financial markets. Governments also acted with surprising speed and announced various stimulus programmes of unprecedented sizes including providing guaranteed loans to companies, payments to cover employees on furlough, direct payments to unemployed

workers etc. all to dampen the impact of lockdowns on businesses and individuals.

Against this background equity markets bounced sharply, led initially by the US and technology shares, which hit all-time highs. Credit markets recovered even more swiftly, benefiting from the Federal Reserve announcement that it would buy Exchange Traded Funds ("ETFs") that invested in corporate bonds, with investment grade bonds recovering all their losses by the end of May. High yield bonds also saw a strong recovery and ended the financial year almost unchanged overall.

While US equity markets led the recovery, the performance of Asia ex Japan markets were stronger over the financial year reflecting their better handling of the crisis and therefore stronger recovery. Conversely European and Japanese equity markets lagged the rally, albeit driven more by their lower weightings in those sectors, such as technology, that have been the biggest beneficiaries of the crisis.

In November, equity markets posted further significant gains on the back of the positive news on the efficacy of Pfizer's coronavirus vaccine, in collaboration with BioNTech, as well as those being developed by others. Furthermore, the result of the US election, with Joe Biden winning the White House, was seen as decisive enough to remove the risks of months of legal wrangling over the outcome and helped to underpin the rally in equity markets.


Despite the discount at which the sector was trading relative to underlying equity markets at the beginning of the year, the onset of COVID-19 led to material underperformance. Banks initially suffered very large falls in share prices as the combination of falling interest rates, which for most banks reduces net interest margins, rising provisions for loan losses brought on by lockdowns and behavioural changes around spending, had a significant impact on profitability.

Globally banks raised loan loss reserves against future losses significantly, particularly in the US and Asia, but to a smaller extent in Europe, in part driven by a change in accounting rules that means banks have to recognise potential losses earlier in a downturn than they would have previously. These estimates assumed significant falls in GDP and real estate prices as well as a sharp rise in unemployment.

There was a strong pick up in loan growth at the start of the crisis as corporate customers drew down on facilities, which offset some of the headwind of falling net interest margins, although the vast majority was quickly repaid over the ensuing months as companies were able to tap capital markets. Larger banks benefited from strong trading and investment banking revenues, resulting from the volatility in financial markets, which was a significant offset to weaker retail and commercial banking revenues.

Regulators in the UK and Europe were quick to react to the crisis, telling banks to suspend dividend payments and buybacks. Regulators elsewhere took a more pragmatic approach. In the US restrictions were limited to a ban on buybacks and a cap on dividends not to exceed earnings over the previous four quarters while in other markets regulators put some limited restrictions on the level of dividends banks could pay.

Conversely, regulators also lowered capital requirements, reducing counter-cyclical buffers to zero while also reducing other buffers, giving banks more flexibility to take loan losses but still support borrowers. They also told banks to not automatically treat borrowers who asked for loan payment holidays as likely to default as they would have had to do under the new accounting rules.

Insurance companies also suffered large falls in share prices. Life assurance companies, which are highly geared to credit markets and to a lesser extent equity markets, corrected sharply. Counterintuitively, non-life insurance companies, which historically have acted very defensively in market corrections as earnings are driven by claims which are largely accident or weather related, also suffered large share price falls, driven by concerns over their exposure to COVID-19 insured losses due in part to poor policy wording.

Consequently, a number of insurance companies raised capital to either repair their weaker balance sheets and/or to take advantage of the more positive pricing environment going forward. The one exception has been those insurers primarily focused on auto or home insurance which have benefited from lower frequency of claims brought on by the significant increase in people working from home and thus much reduced road traffic. Some of these savings were returned to policyholders as rebates but the lower claims have also resulted in a fall in car insurance rates.

The share prices of payment companies were very resilient over the financial year and hit all-time highs. While not immune to the downturn which has reduced revenues from the travel industry, their business models have remained resilient as they have little or no balance sheet risk. They have also been seen as beneficiaries of lockdowns, as it has accelerated the shift of consumers using cash to cards and led to faster growth of e-commerce.

Stock exchanges have also proved very resilient, benefiting from their reliance on data revenues but also higher trading volumes on the back of volatility in financial markets. A number similarly hit all-time highs during the year. The share prices of asset managers, not surprisingly, also fell sharply but rallied along with financial markets, with alternative asset managers and those traditional asset managers with large passive fund businesses continuing to outperform their peers focused primarily on actively managed fund mandates.

Investment Activity

Reflecting the volatility in financial markets there was significant investment activity over the 12 months. Following the fall in equity markets we reduced some of our European bank exposure and holdings in smaller US regional banks which we saw as more vulnerable to a deep recession. These included selling holdings in Banco Santander, BNP Paribas, Comerica, ING Groep, KeyCorp and Lloyds Bank while decreasing a number of others.

New holdings purchased include Adyen, American Express, Berkshire Hathaway, Hong Kong Exchanges & Clearing Limited, Hiscox, Prosperity Bancshares and Ping An Insurance, all businesses which we saw as more resilient to the fallout of the COVID-19 crisis. We also purchased bonds issued by Pension Insurance Corporation, ING Groep, Natwest and Jupiter Fund Management, the latter which were issued to facilitate its purchase of Merian Global Investors.

As a result of the corporate action, we raised the cash needed to meet the tender offer on the day it was effective with no impact on performance. The portfolio was reduced pro-rata with the sole exception of our holding in Atom Bank. Atom Bank is unquoted and therefore not readily realisable. The carrying value already reflected the illiquidity plus the sharp fall in valuations of its listed UK bank peers.

In the second half of the financial year we took advantage of the strength in share prices of payment companies to reduce holdings in Adyen, MasterCard and PayPal Holdings as well as some our non-life insurance holdings, for example Marsh & McLennan, Chubb and Progressive. Other holdings that were reduced included Toronto Dominion, SVB Financial and E. Sun Financial Holding which had all performed relatively well. A holding in Alternative Credit Investments was also sold.

Against these the opportunity was taken to increase our bank holdings which had lagged the recovery in equity markets including EastWest Bancorp, Signature Bank, Tisco Financial and Wells Fargo while starting new holdings in Chailease Holding, China Merchant Bank, Kasikorn Bank and Webster Financial. A new holding was also purchased in Riverstone Credit Opportunities which had fallen to a significant discount to its net asset value.

Over the year, exposure to emerging markets was increased significantly, in particular to India, adding to our holding in HDFC Bank while starting a new holding in HDFC Corp and Axis Bank among others. We also increased our exposure to China through the purchase of China Merchant Bank, mentioned above, but also Ping An Insurance Group. Gearing started the financial year at 4.4% and over the summer months this was increased to take advantage of depressed valuations, ending the year at 12.7%.


The decision by UK and European regulators to make banks and some insurance companies under their jurisdiction suspend dividend payments at the onset of the crisis has reduced dividend payments in the short-term and as such the revenue generated from the portfolio. We have also reduced the Company's exposure to some of the higher-yielding stocks in the sector over the last year, which has had an impact on income, countered by positive capital performance.

There had been some expectation that regulators would push back the decision to reinstate dividends until March or April 2021 when there would be more visibility about the outlook for economic growth. However, in November 2020, the Bank of Thailand lifted restrictions on banks under its jurisdiction paying dividends and this was followed in December by regulators in Europe, the UK and the US similarly reducing restrictions on the banks under their jurisdiction returning capital to shareholders.

Regulators in the US have taken a more pragmatic approach and have allowed buybacks to restart in January 2021, albeit the combination of buybacks and dividends cannot exceed the last four quarters of net income. This will mean the potential for higher capital returns in the second half of 2021 as weaker first-half 2020 earnings drop out of the calculation. In the UK and Europe regulators have made it unnecessarily complicated by limiting capital return to the higher of 25% of earnings or 20bps of risk-weighted capital in the UK, while in the Eurozone to the lower of 15% of earnings or 20bps of risk-weighted capital.

Looking forward, assuming global growth picks up as expected over the course of 2021 and 2022 we would expect dividend growth to be in the order of high single-digit to low double-digit per cent annually. Nevertheless, on its own, this will be insufficient to cover the Company's current level of dividend without positioning the portfolio back towards holding more higher income stocks. We aim to maximise the portfolio's total return while balancing the need to provide a reasonable level of income, so this will be borne in mind.

Environmental, Social and Governance (ESG)

In the last couple of years ESG factors have become an important yardstick in measuring how an individual company approaches its responsibilities to its different stakeholders. The global financials sector was already a very highly regulated sector due to its importance for financial stability, payments, providing credit, savings products etc. and it has rightly become even more so over the past 10 or so years.

Historically our focus has been almost exclusively on governance and risk management. For example, failures to underwrite risk adequately rarely ends well and can indicate weak controls and/or poor incentives. Meeting management teams is an important part of the investment process in understanding how risk is managed. We like businesses that have competitive advantages, are good underwriters of risk and have higher profitability so that they are more resilient over an economic cycle and therefore more likely to outperform their peers.

Going forward we expect the focus on financial inclusion during a period of rapid technological change will become increasingly important especially where it potentially excludes certain demographics. Longer-term environmental factors will also become increasingly important given the societal benefits and governments' focus on the transition to a sustainable economy. The financial sector will be an important vehicle for facilitating these changes.

We source data from third-party providers such as MSCI on ESG scores and Institutional Shareholder Services ("ISS") for voting at general meetings. While we have used both to highlight any issues around individual portfolio holdings in the past, we now also blend the MSCI data we receive with our own internal risk assessment, which takes into account a forward-looking view, to produce an ESG score for an individual company which is integrated into our quantitative scoring system.

We expect the process to continue to evolve but we believe qualitative inputs will always remain important as well. For example, we see an opportunity in some smaller or mid-cap companies that are often scored poorly by ESG data providers due to poor disclosure or where ratings are backward looking. Over time as greater resources are put to meeting disclosure requirements or companies make the changes necessary to meet the higher bar expected of them their ratings will increase and that should support share prices.


The significant underperformance of the financial sector over the past year has been exacerbated by the difficulty investors have found in quantifying the impact on it, given the size of the exogenous shock to economic activity and lack of historical comparisons. We consistently believed that the downturn brought on by COVID-19 would be an earnings event for the sector given its underlying profitability and capital buffers, not a capital one, and therefore the fall in valuations was not justified by the fundamentals.

We continue to hold sizeable investments in a number of payment companies and emerging market financials among others, which continue to exhibit good earnings growth, as they are benefiting from structural growth trends, which we expect to remain resilient even if there is further volatility in financial markets. While valuations for some of these companies are very high by historical standards, along with some of our fixed-income and other more defensive holdings they counterbalance the more cyclical parts of the Company's portfolio.

Nevertheless, the majority of the Company's assets are invested in banks and non-life insurance stocks. The valuation of non-life insurance stocks has fallen quite sharply over concerns that the sector will suffer a significant hit to earnings. However, banks have seen the sharpest falls in share prices, taking their valuations, earlier in the year, down to levels only previously seen during the global financial crisis when, unlike today, the solvency of the banking sector was in question.

While the sector rallied from the lows in March it was not until November 2020, on the back of the announcement of positive test results for a number of vaccines that markets saw a very sharp rotation back into financials, in particular bank stocks. Despite the rally, the underperformance of the sector versus underlying equity markets since the onset of COVID-19 remains material at close to 20% for the 2020 calendar year. However, if the distribution of vaccines allows governments to pivot and reduce restrictions more quickly, it is likely that growth will surprise in 2021 and 2022 and the sector will continue its recent outperformance.

Certainty about loan losses will be critical to the performance of bank stocks and therefore the sector. Evidence so far is that companies and individuals who have taken up payment holidays have by a significant majority returned to paying interest and principal as normal. The reality is that the size of loan losses will not be known until the second half of 2021 and by then the sector will have rallied further if economic growth is as strong as currently forecast. The recent pickup in M&A activity would suggest management teams are increasingly confident about the outlook and therefore balance sheet risks.

Governments and central banks continue to provide significant fiscal and monetary stimulus. Against this background banks have taken provisions for a deeper downturn, for higher unemployment and for a fall in house prices that is yet to be borne out. As a result, it is likely that some of the loan loss reserves they have taken will have to be written back which will boost earnings. Any pick-up in loan growth and fee income growth where expectations are muted will further boost earnings.

In that vein one of the biggest headwinds for the banking sector in recent years has been the decline in interest rates. Part of the reason for this is that central banks have had to do most of the heavy lifting in stimulating demand by keeping interest rates low as governments have run tight fiscal budgets. The steps that governments have taken this year, as a consequence of COVID-19 induced lockdowns, has led to broad money growth in the OECD hitting at a 30-year high and its highest in the US since the Second World War. The implications of this are unclear but may well lead to a less disinflationary/more inflationary environment looking forward which should materially benefit the sector.

The financial sector operationally has performed well during the crisis, and unexpectedly incumbents have for the most part been a bigger beneficiary of lockdowns than some of their smaller digital competitors. It has also facilitated government guaranteed lending to businesses through the likes of the Coronavirus Business Interruption Loan Scheme in the UK and Paycheck Protection Programme in the US. Balance sheets remain robust, earnings will recover sharply over the next few years and capital trapped by regulators will inevitably be released. While the discount at which the sector trades relative to the underlying equity markets has narrowed from the lows of March, it remains high historically, offering significant further upside.

Nick Brind, John Yakas & George Barrow

22 February 2021


We would draw shareholders attention to for regular monthly portfolio updates and commentary.

*index performance figures are total return in Sterling

Portfolio Review

As at 30 November 2020

                           New Benchmark:                     Old Benchmark: 
                                MSCI ACWI                         MSCI World 
                               Financials                         Financials 
                                weighting                      + Real Estate 
                                 as at 30                          weighting 
                                 November   30 November    as at 30 November   30 November 
 Geographical Exposure*            2020**          2020               2019**          2019 
------------------------  ---------------  ------------  -------------------  ------------ 
 North America                      48.3%         49.3%                60.0%         52.2% 
 Asia (ex-Japan)                    20.1%         29.4%                10.4%         16.8% 
 Europe                             16.4%         17.3%                15.9%         16.3% 
 United Kingdom                      6.0%          8.6%                 6.9%          8.3% 
 Fixed Income                           -          6.6%                    -          7.2% 
 Latin America                       1.9%          2.2%                    -          1.6% 
 Japan                               4.3%             -                 6.5%          1.5% 
 Eastern Europe                         -             -                    -          0.2% 
 Other net liabilities                  -       (13.4%)                    -        (4.1%) 
 Total                                           100.0%                             100.0% 
------------------------  ---------------  ------------  -------------------  ------------ 
                           New Benchmark:                     Old Benchmark: 
                                MSCI ACWI                         MSCI World 
                               Financials                         Financials 
                                weighting                      + Real Estate 
                                 as at 30                          weighting 
                                 November   30 November    as at 30 November   30 November 
 Sector Exposure*                  2020**          2020               2019**          2019 
------------------------  ---------------  ------------  -------------------  ------------ 
 Banks                              47.8%         62.1%                40.1%         64.6% 
 Insurance                          23.0%         20.4%                19.9%         16.6% 
 Diversified Financials             29.1%         15.2%                22.7%          7.1% 
 Software & Services                    -          7.8%                    -          4.6% 
 Fixed Income                           -          6.6%                    -          7.2% 
 Real Estate                            -          1.3%                17.4%          4.0% 
 Other net liabilities                  -       (13.4%)                    -        (4.1%) 
 Total                                           100.0%                             100.0% 
------------------------  ---------------  ------------  -------------------  ------------ 
                          New Benchmark:                  Old Benchmark: 
                               MSCI ACWI                      MSCI World 
                              Financials                      Financials 
                               weighting                   + Real Estate 
                                as at 30                    weighting as 
                                November   30 November    at 30 November   30 November 
 Market Cap*                      2020**          2020            2019**          2019 
-----------------------  ---------------  ------------  ----------------  ------------ 
 Large (>US$5bn)                   98.0%         97.6%             99.1%         90.1% 
 Medium (US$0.5bn - 
  US$5bn)                           2.0%         12.8%              0.9%         10.7% 
 Small (<US$0.5bn)                     -          3.0%                 -          3.3% 
 Other net liabilities                 -       (13.4%)                 -        (4.1%) 
 Total                                          100.0%                          100.0% 
-----------------------  ---------------  ------------  ----------------  ------------ 

* Based on the net assets as at 30 November 2020 of GBP165.7m (2019: GBP301.2m)

** The benchmark changed on 23 April 2020 to MSCI ACWI Financials Net Total Return Index (in Sterling with dividends reinvested), prior to this the Company's benchmark was MSCI World Financials + Real Estate Net Total Return Index. Classifications derived from the Benchmark Index as far as possible. Not all geographical areas or sectors of the Benchmark are shown, only those in which the Company had an investment at the year end.

Full Investment Portfolio

As at 30 November 2020

                                                                           Market Value        % of total 
    Ranking                                                                   GBP'000           net assets 
        ( 2019 
 2020      )     Stock                        Sector           Country       2020     2019      2020    2019 
-----  -------  ----------------------  ------------  ----------------  ---------  -------  --------  ------ 
  1      (1)     JP Morgan Chase               Banks     North America      9,190   19,842      5.5%    6.6% 
  2      (2)     Bank of America               Banks     North America      5,658   13,844      3.4%    4.6% 
  3      (3)     Mastercard               & Services     North America      5,657   10,847      3.4%    3.6% 
  4      (13)    HDFC Bank                     Banks   Asia (ex-Japan)      5,317    7,013      3.2%    2.3% 
  5      (4)     CHUBB                     Insurance            Europe      4,629    9,966      2.8%    3.3% 
  6      (11)    AIA Group                 Insurance   Asia (ex-Japan)      4,425    7,198      2.7%    2.4% 
  7      (45)    PayPal                   & Services     North America      4,205    3,023      2.5%    1.0% 
                 Bank Central 
  8      (22)     Asia                         Banks   Asia (ex-Japan)      3,846    5,134      2.3%    1.7% 
  9      (14)    KBC Groep                     Banks            Europe      3,795    6,868      2.3%    2.3% 
                 PNC Financial 
  10     (9)      Services                     Banks     North America      3,717    7,728      2.3%    2.6% 
 Top 10 investments                                                        50,439              30.4% 
--------------------------------------  ------------  ----------------  ---------  -------  --------  ------ 
  11     (5)     Arch Capital              Insurance     North America      3,489    9,576      2.1%    3.2% 
  12     (12)     Bank                         Banks     North America      3,422    7,178      2.1%    2.4% 
                 Citizens Financial 
  13     (6)      Group                        Banks     North America      3,421    8,349      2.1%    2.8% 
                 Housing Development 
  14     (-)      Finance                      Banks   Asia (ex-Japan)      3,414        -      2.1%       - 
  15     (-)     Ping An Insurance         Insurance   Asia (ex-Japan)      3,406        -      2.1%       - 
  16     (20)    Blackstone               Financials     North America      3,171    5,453      1.9%    1.8% 
  17     (27)    SVB Financial                 Banks     North America      3,152    4,936      1.9%    1.6% 
  18     (-)     Hong Kong Exchange       Financials   Asia (ex-Japan)      3,148        -      1.9%       - 
  19     (18)    DNB                           Banks            Europe      3,050    5,582      1.8%    1.9% 
  20     (33)    BNP Paribas                   Banks            Europe      2,982    3,923      1.8%    1.3% 
 Top 20 investments                                                        83,094              50.2% 
--------------------------------------  ------------  ----------------  ---------  -------  --------  ------ 
  21     (30)    OSB Group                     Banks    United Kingdom      2,961    4,276      1.8%    1.4% 
  22     (-)     Signature Bank                Banks     North America      2,922        -      1.8%       - 
  23     (-)     American Express         Financials     North America      2,888        -      1.7%       - 
  24     (7)     US Bancorp                    Banks     North America      2,886    7,801      1.7%    2.6% 
  25     (52)    UBS Group                     Banks            Europe      2,849    2,421      1.7%    0.8% 
  26     (-)     Berkshire Hathaway       Financials     North America      2,673        -      1.6%       - 
  27     (-)     Prosperity Bancshares         Banks     North America      2,632        -      1.6%       - 
  28     (8)     Wells Fargo                   Banks     North America      2,480    7,786      1.5%    2.6% 
                 China Merchants 
  29     (-)      Bank                         Banks   Asia (ex-Japan)      2,476        -      1.5%       - 
  30     (-)     Axis Bank                     Banks   Asia (ex-Japan)      2,446        -      1.5%       - 
 Top 30 investments                                                       110,307              66.6% 
--------------------------------------  ------------  ----------------  ---------  -------  --------  ------ 
  31     (23)    East West Bancorp             Banks     North America      2,411    5,102      1.5%    1.7% 
                 First Republic 
  32     (16)     Bank                         Banks     North America      2,392    5,660      1.4%    1.9% 
  33     (29)    Sampo                     Insurance            Europe      2,371    4,347      1.4%    1.4% 
  34     (17)    Allianz                   Insurance            Europe      2,370    5,590      1.4%    1.9% 
  35     (42)    Tisco Financial               Banks   Asia (ex-Japan)      2,300    3,113      1.4%    1.0% 
  36     (25)    E. Sun Financial              Banks   Asia (ex-Japan)      2,283    4,994      1.4%    1.7% 
  37     (-)     Prudential                Insurance    United Kingdom      2,274        -      1.4%       - 
  38     (-)     Chailease                Financials   Asia (ex-Japan)      2,270        -      1.4%       - 
  39     (-)     Webster Financial             Banks     North America      2,211        -      1.3%       - 
                 Enterprise Financial 
  40     (24)     Services                     Banks     North America      2,209    5,081      1.3%    1.7% 
 Top 40 investments                                                       133,398              80.5% 
--------------------------------------  ------------  ----------------  ---------  -------  --------  ------ 
  41     (10)    Marsh & McLennan          Insurance     North America      2,182    7,487      1.3%    2.4% 
  42     (-)     Hiscox                    Insurance     North America      2,173        -      1.3%       - 
  43     (-)     Keppel DC REIT          Real Estate   Asia (ex-Japan)      2,134        -      1.3%       - 
  44     (41)    Atom Bank (unquoted)          Banks    United Kingdom      2,120    3,191      1.3%    1.1% 
                 VPC Specialty                 Fixed 
  45     (36)     Lending Investments         Income      Fixed Income      2,103    3,737      1.3%    1.2% 
                 Intact Financial 
  46     (43)     Corporation              Insurance     North America      2,070    3,041      1.3%    1.0% 
  47     (-)     Bajaj Finance            Financials   Asia (ex-Japan)      2,020        -      1.2%       - 
                 Bank of the 
  48     (37)     Philippine Islands           Banks   Asia (ex-Japan)      2,010    3,555      1.2%    1.2% 
  49     (39)     Banking                      Banks   Asia (ex-Japan)      1,985    3,441      1.2%    1.2% 
  50     (-)     Manappuram Finance       Financials   Asia (ex-Japan)      1,946        -      1.2%       - 
 Top 50 investments                                                       154,141              93.1% 
--------------------------------------  ------------  ----------------  ---------  -------  --------  ------ 
  51     (-)     Adyen                    & Services            Europe      1,846        -      1.1%       - 
  52     (34)    Solar Capital            Financials     North America      1,841    3,793      1.1%    1.2% 
  53     (48)    Itaú Unibanco            Banks     Latin America      1,769    2,775      1.1%    0.9% 
                 Grupo Financiero 
  54     (56)     Banorte                      Banks     Latin America      1,758    2,206      1.1%    0.7% 
  55     (31)    Ares Capital             Financials     North America      1,728    4,127      1.0%    1.4% 
                 Direct Line 
  56     (46)     Insurance                Insurance    United Kingdom      1,688    2,858      1.0%    1.0% 
  57     (51)    Sparebank SMN                 Banks            Europe      1,667    2,470      1.0%    0.8% 
  58     (-)     Kasikornbank                  Banks   Asia (ex-Japan)      1,656        -      1.0%       - 
                  Personal Finance             Fixed 
  59     (-)      9.75% Bond                  Income      Fixed Income      1,546        -      0.9%       - 
                 Nationwide Building 
                  Society 10.25%               Fixed 
  60     (40)     CCDS                        Income      Fixed Income      1,542    3,267      0.9%    1.1% 
 Top 60 investments                                                       171,182             103.3% 
--------------------------------------  ------------  ----------------  ---------  -------  --------  ------ 
  61     (-)     Intesa Sanpaolo               Banks            Europe      1,520        -      0.9%       - 
  62     (-)     Lancashire                Insurance    United Kingdom      1,490        -      0.9%       - 
                 City of London          Diversified 
  63     (49)     Investment Group        Financials    United Kingdom      1,486    2,622      0.9%    0.9% 
  64     (-)     Alibaba                  & Services   Asia (ex-Japan)      1,371        -      0.8%       - 
  65     (-)     Banca Generali           Financials            Europe      1,174        -      0.7%       - 
                 Lloyds Banking 
  66     (26)     Group                        Banks    United Kingdom      1,157    4,952      0.7%    1.6% 
  67     (-)      Corporation              Insurance     North America      1,117        -      0.7%       - 
  68     (67)    Augmentum Fintech        Financials    United Kingdom      1,043    1,050      0.6%    0.3% 
                 Aldermore Group               Fixed 
  69     (57)     8.5% Bond                   Income      Fixed Income        979    2,151      0.6%    0.7% 
                  Personal Finance             Fixed 
  70     (63)     7.75% Bond                  Income      Fixed Income        940    1,626      0.6%    0.5% 
-----  -------  ----------------------  ------------  ----------------  ---------  -------  --------  ------ 
 Top 70 Investments                                                       183,459             110.7% 
--------------------------------------  ------------  ----------------  ---------  -------  --------  ------ 
                 Riverstone Credit             Fixed 
  71     (-)      Opportunities               Income      Fixed Income        781        -      0.5%       - 
                 Finecobank Banca 
  72     (-)      Fineco                       Banks            Europe        726        -      0.4%       - 
                 National Westminster 
                  Bank Floating                Fixed 
  73     (-)      Rate Bond                   Income      Fixed Income        693        -      0.4%       - 
                 National Westminster 
                  Bank Floating                Fixed 
  74     (-)      Rate Bond                   Income      Fixed Income        688        -      0.4%       - 
                 Stichting AK 
                  Rabobank 6.5%                Fixed 
  75     (-)      Bond                        Income      Fixed Income        596        -      0.4%       - 
                 ING Groep Floating            Fixed 
  76     (-)      Rate Bond                   Income      Fixed Income        582        -      0.3%       - 
                 Jupiter 8.875%                Fixed 
  77     (-)      Bond                        Income      Fixed Income        486        -      0.3%       - 
-----  -------  ----------------------  ------------  ----------------  ---------  -------  --------  ------ 
 Total Investments                                                        188,011             113.4% 
--------------------------------------  ------------  ----------------  ---------  -------  --------  ------ 
 Other net liabilities                                                   (22,268)            (13.4%) 
--------------------------------------  ------------  ----------------  ---------  -------  --------  ------ 
 Total net assets                                                         165,743             100.0% 
--------------------------------------  ------------  ----------------  ---------  -------  --------  ------ 

Note: Figures in brackets denote comparative rankings as at 30 November 2019.


The Strategic Report section of this Annual Report comprises the Chairman's Statement, the Investment Manager's Report, including information on the portfolio, and this Strategic Report.

This Report has been prepared to provide information to shareholders on the Company's strategy and the potential for those strategies to succeed, including a fair review of the Company's performance during the year ended 30 November 2020, the position of the Company at the year end and a description of the principal risks and uncertainties. Throughout the Strategic Report there are certain forward-looking statements made by the Directors in good faith based on the information available to them at the time of their approval of this Report. Such statements should be treated with caution due to inherent uncertainties, including both economic and business risk factors, underlying any such forward-looking information.

Business Model and Regulatory Arrangements

The Company's business model follows that of an externally managed investment trust, and its investment objective is set out below. Its shares are listed on the main market of the London Stock Exchange.

The Company is designated an Alternative Investment Fund ('AIF') under the Alternative Investment Fund Management Directive ('AIFMD') and, as required by the Directive, has contracted with Polar Capital LLP to act as the Alternative Investment Fund Manager ('AIFM') and HSBC Bank Plc to act as the Depositary.

Both the AIFM and the Depositary have responsibilities under AIFMD for ensuring that the assets of the Company are managed in accordance with the investment policy and are held in safe custody. The Board remains responsible for setting the investment strategy and operational guidelines as well as meeting the requirements of the Financial Conduct Authority ('FCA') Listing Rules and the Companies Act 2006.

The AIFMD requires certain information to be made available to investors in AIFs before they invest and requires that material changes to this information be disclosed in the Annual Report of each AIF. Investor Disclosure Documents, which set out information on the Company's investment strategy and policies, leverage, risk, liquidity, administration, management, fees, conflicts of interest and other shareholder information are available on the Company's website.

There have been no material changes to the information requiring disclosure. Any information requiring immediate disclosure pursuant to the AIFMD will be disclosed to the London Stock Exchange through a primary information provider. Statements from the Depositary and the AIFM can be found on the Company's website.

The Company seeks to manage its portfolio in such a way as to meet the tests in Section 1158 and 1159 of the Corporation Tax Act 2010 (as amended by Section 49(2) of the Finance Act 2011) and continue to qualify as an investment trust. This qualification permits the accumulation of capital within the portfolio without any liability to UK Capital Gains Tax. Further information is provided in the Directors' Report. The Company has no employees or premises and the Board is comprised of Non-executive Directors. The day to day operations and functions have all been delegated to third parties.

Investment Objective and Policy

The Company's investment objective is to generate for investors a growing dividend income together with capital appreciation. The Company seeks to achieve its objective by investing primarily in a global portfolio consisting of listed or quoted securities issued by companies in the financials sector operating in banking, insurance, property and other sub-sectors. The portfolio is diversified by geography, industry sub-sector and stock market capitalisation.

The Company may have a small exposure to unlisted and unquoted companies, but in aggregate, this is not expected to exceed 10% of total assets at the time of investment. The Company will not invest more than 10% of total assets, at the time of investment, in other listed closed-ended investment companies and no single investment will normally account for more than 10% of the portfolio at the time of investment.

The Company may employ levels of borrowing from time to time with the aim of enhancing returns, currently subject to an overall maximum of 20% (maximum level was increased from 15% at the time of the reconstruction in April 2020) of net assets at the time the relevant borrowing is taken out. Actual levels of borrowing may change from time to time based on the Investment Manager's assessment of risk and reward.

The Company may invest through equities, index-linked and other debt securities, cash deposits, money market instruments, foreign currency exchange transactions, forward transactions, index options and other instruments including derivatives. Forward transactions, derivatives (including put and call options on individual positions or indices) and participation notes may be used to gain exposure to the securities of companies falling within the Company's investment policy or to seek to generate income from the Company's position in such securities, as well as for efficient portfolio management. Any use of derivatives for investment purposes is made on the basis of the same principles of risk spreading and diversification that apply to the Company's direct investments. The Company may hedge exposure to foreign currencies if considered appropriate for efficient portfolio management.

The Board

As the day to day management of the Company is outsourced to service providers the Board's focus at each meeting is on investment performance, including the outlook and strategy. The Board also considers the management and provision of services received from third-party service providers and the risks inherent in the various matters reviewed and discussed.

Life of the Company - Tender Offer/ Reconstruction

The Company was originally launched with a fixed life of seven-years ending in April 2020; proposals were made to shareholders for a 100% tender offer and replacement of the fixed life with subsequent five-yearly tender offers. Such proposals were passed at the General Meeting held on 7 April 2020; the first tender offer as a result of the proposals will be made to shareholders on or before 30 June 2025.

Strategy and Investment Approach

The Investment Manager's investment process is a six-stage process primarily driven by a bottom-up fundamental analysis of individual companies, albeit with macroeconomic inputs. The Investment Manager regularly uses both quantitative and qualitative screens to rank companies on a risk-adjusted basis, since the fundamental view is that long-term returns in most financial stocks are driven by their success in writing risk, rather than short-term growth trends. The approach involves undertaking a detailed income statement and balance sheet analysis and values a company based on the Capital Asset Pricing Model that compares a company's return on equity versus its cost of capital (the latter taking account of both stock and country risk) to provide a fair price/book valuation. This valuation (coupled with other more standard valuation systems) is then ranked across the global universe and added to scores focused on other variables such as profitability, risk, ESG and growth metrics to provide a model portfolio and so a focus for additional stock-specific research. When permitted, the Investment Manager undertakes regular trips to the US, Europe and Asia to meet companies as well as those they meet in London, leveraging off the combined experience of the Investment Manager's team of seven fund managers and analysts who focus on the global financials sector.

There are no limits on the exposure of the investment portfolio to either smaller or mid-cap companies but the majority of the portfolio is invested in companies with a market capitalisation of above US$5bn. The Investment Manager has discretion to invest up to 10% of the portfolio in debt securities.

The vast majority of the investment portfolio is invested in companies that not only offer capital appreciation but pay dividends, which are expected to rise over time, so as to meet the necessary income required to facilitate the payment of a rising level of dividends to shareholders. However, as a result of COVID-19, a number of regulators restricted or limited dividends reducing the earnings capability of the portfolio.

Although some of these restrictions are now being relaxed, at the time of writing the financial and economic outlook remains highly uncertain. The Board, together with the Manager will continue to assess the likely income capability of the portfolio in a post COVID environment to determine the appropriate longer-term distribution level.

Service Providers

Polar Capital LLP has been appointed to act as the Investment Manager and AIFM as well as to provide or procure company secretarial, marketing and administrative services, including accounting, portfolio valuation and trade settlement which it has arranged to deliver through HSBC Securities Services.

The Company also contracts directly, on terms agreed periodically, with a number of third parties for the provision of specialist services:

   --      HSBC Securities Services as Custodian and Depositary; 
   --      Stifel Nicolaus Europe Limited* as Corporate Broker; 
   --      Equiniti Limited as Share Registrars; 
   --      PricewaterhouseCoopers LLP as Independent Auditors; 
   --      RD:IR for investor relations and shareholder analysis; 
   --      Marten & Co as third-party research providers. 
   --      Perivan as Designers and Printers for shareholder communications; and 
   --      Huguenot Limited as Website Designers and internet hosting services. 

* Investec Bank plc resigned as the Company's corporate broker and the Board appointed Stifel Nicolaus Europe Limited as sole corporate broker to the Company on 29 April 2020.


The Company will measure the Investment Manager's performance against the MSCI ACWI Financials Net Total Return Index, in Sterling with dividends reinvested ('the Benchmark'). This is used to measure the performance of the Company from 23 April 2020, which does not seek to replicate the index in constructing its portfolio. The portfolio may, therefore, diverge substantially from the constituents of this Benchmark. Prior to the proposals made to shareholders in April 2020, the Company measured performance against the MSCI World Financials + Real Estate Net Total Return Index, in Sterling with dividends reinvested. The utilisation of the adopted benchmarks before and after the April 2020 change is detailed within the Manager's Report.

Although the Company has a Benchmark, this is neither a target nor a determinant of investment strategy. The purpose of the Benchmark is to set out a reasonable measure of performance for shareholders and an appropriate base which, together with an additional hurdle, forms the level above which the Investment Manager earns a share of any outperformance it has delivered.

Performance and Key Performance Objectives

The Board appraises the performance of the Company and the Investment Manager as the key supplier of services to the Company against key performance indicators ('KPIs'). The objectives of the KPIs comprise both specific financial and shareholder related measures.

 Objective                          Control process                        KPI / Outcome 
---------------------------------  -------------------------------------  ---------------------------------- 
 The provision of investment        The Board reviews at each              The Company's NAV total 
  returns to                         meeting the                            return, over the year 
  shareholders measured              performance of the portfolio           ended 30 November 2020, 
  by long-term NAV total             and considers the views                was -6.5%* while the Benchmark 
  return relative to the             of the Investment Manager              delivered -6.4% over the 
  Benchmark and a comparator         and the value delivered                same period. 
  group.                             to shareholders through 
                                     NAV growth and dividends 
                                                                            The Company ranked 16 
                                     The Board also receives                out of 40 open ended funds 
                                     monthly reports on performance         within the Lipper Financial 
                                     against both the Benchmark             Sector universe since 
                                     and a comparator group                 inception and 5 out of 
                                     of open-ended investment               7 within the short comparator 
                                     funds.                                 group of funds regularly 
                                                                            considered by the Board 
                                                                            as at the year ended 30 
                                                                            November 2020. 
---------------------------------  -------------------------------------  ---------------------------------- 
 The achievement of a progressive   Financial forecasts are                A total of two interim 
  dividend policy.                   reviewed to track income               dividends amounting to 
                                     and distributions.                     4.40p (2019: 4.40p) per 
                                                                            ordinary share have been 
                                                                            paid or declared in respect 
                                                                            of the financial year 
                                                                            ended 30 November 2020. 
                                                                            As referenced within the 
                                                                            Chairman's Statement, 
                                                                            due to the highly uncertain 
                                                                            financial and economic 
                                                                            outlook the Company has 
                                                                            maintained the dividend 
                                                                            at the level paid in 2019. 
                                                                            While the aim to achieve 
                                                                            dividend growth remains 
                                                                            there is no guarantee 
                                                                            that this can be achieved. 
---------------------------------  -------------------------------------  ---------------------------------- 
 Monitoring and reacting            The Board receives regular             The premium of the ordinary 
  to issues created by the           information on the composition         share price to the NAV 
  discount or premium of             of the share register                  per ordinary share at 
  the ordinary share price           including trading patterns             the year end was 1.3%* 
  to the NAV per ordinary            and discount/premium levels            compared with the widest 
  share with the aim of              of the Company's ordinary              discount over the year 
  reducing volatility for            shares. The Board                      ended 30 November 2020 
  shareholders.                      discusses and authorises               of 12.6%, reached on 24 
                                     the issue or buy back                  August 2020. 
                                     of shares when appropriate. 
                                     The Board is aware of 
                                     the vulnerability of a                 In the year ended 30 November 
                                     sector specialist investment           2020, the Company bought 
                                     trust to a change in investor          back 79,159,235 ordinary 
                                     sentiment towards that                 shares as part of the 
                                     sector. While there is                 tender offer to shareholders 
                                     no formal discount policy              in April 2020 and 670,000 
                                     the Board discusses the                ordinary shares in a series 
                                     market factors giving                  of small purchases. The 
                                     rise to any discount or                Company also issued 104,335 
                                     premium, the long or short-term        ordinary shares during 
                                     nature of those factors                the year under review. 
                                     and the overall benefit 
                                     to shareholders of any                 All shares bought back 
                                     mitigating actions. The                in the year under review 
                                     market liquidity                       and as part of the tender 
                                     is also considered when                offer were placed into 
                                     authorising the issue                  treasury for reissue when 
                                     or buy back of shares                  suitable market conditions 
                                     when appropriate market                prevailed. 
                                     conditions prevail. 
                                     A daily NAV per share, 
                                     calculated in accordance 
                                     with the AIC guidelines 
                                     is issued to the London 
                                     Stock Exchange. 
---------------------------------  -------------------------------------  ---------------------------------- 
 To qualify and continue            The Board receives regular             The Company has been granted 
  to meet the requirements           financial information                  investment trust status 
  for Sections 1158 and              which discloses the current            annually since its launch 
  1159 of the Corporation            and projected financial                on 1 July 2013 and is 
  Tax Act 2010 ('investment          position of the Company                deemed to be granted such 
  trust status').                    against each of the tests              status for each subsequent 
                                     set out in Sections 1158               year subject to the Company 
                                     and 1159.                              continuing to satisfy 
                                                                            the conditions of Section 
                                                                            1158 of the Corporation 
                                                                            Tax Act 2010 and other 
                                                                            associated ongoing requirements. 
                                                                            The Directors believe 
                                                                            that the tests have been 
                                                                            met in the financial year 
                                                                            ended 30 November 2020 
                                                                            and will continue to be 
---------------------------------  -------------------------------------  ---------------------------------- 
 Efficient operation of             The Board considers annually           The Board, through the 
  the Company with appropriate       the services provided                  Audit Committee has received 
  investment management              by the Investment Manager,             and considered satisfactory 
  resources and services             both investment and administrative,    the internal controls 
  from third party suppliers         and reviews on a cycle                 report of the Investment 
  within a stable and risk           the provision of services              Manager and other key 
  controlled environment.            from third parties including           suppliers including contingency 
                                     the costs of their services.           arrangements to facilitate 
                                                                            the ongoing operations 
                                                                            of the Company in the 
                                                                            event of withdrawal or 
                                                                            failure of services. The 
                                                                            Committee has 
                                                                            also reviewed the operational 
                                                                            resilience of its various 
                                                                            service providers in connection 
                                                                            with mitigation of the 
                                                                            business risks posed by 
                                                                            COVID-19. The external 
                                                                            service providers have, 
                                     The annual operating expenses          without exception, demonstrated 
                                     are reviewed and any non-recurring     their 
                                     project related expenditure            ability to continue to 
                                     approved by the Board.                 provide services to the 
                                                                            expected level, whilst 
                                                                            doing so remotely. 
                                                                            The ongoing charges for 
                                                                            the year ended 30 November 
                                                                            2020 excluding the performance 
                                                                            fee were 1.09% of net 
                                                                            assets (2019: 1.04%)*. 
                                                                            The ongoing charges including 
                                                                            the performance fee 
                                                                            payable were 1.74% (2019: 
---------------------------------  -------------------------------------  ---------------------------------- 

*See Alternative Performance Measures contained in the Annual Report

Principal Risks and Uncertainties

The Board is responsible for the management of risks faced by the Company in delivering long-term returns to shareholders. The Board believes identification, monitoring and appraisal of the risks, any mitigating factors and control systems is crucial. Through delegation to the Audit Committee, it has established procedures to manage risk, oversee the internal control framework and determine the nature and extent of the principal risks the Company is willing to take in order to achieve its long-term strategic objectives.

The Board through the Audit Committee carries out, at least annually, a robust assessment of the principal risks and uncertainties with the assistance of the Investment Manager, continually monitors identified risks and meets to discuss both long-term and emerging risks outside of the normal cycle of Audit Committee meetings. A Risk Map is maintained which seeks to identify and allocate risks to four main risk categories: Business, Portfolio Management, Infrastructure and External.

A risk management process has been established to identify and assess various risks, their likelihood and the possible severity of impact. After considering both internal and external controls and factors that could provide mitigation, a post mitigation risk impact score is determined. The Board, with the assistance of the Audit Committee, believes it has identified the key risks faced by the Company.

The Audit Committee, in conjunction with the Board and the Investment Manager, has undertaken a full review of the Company's Risk Map including the mitigating factors and controls to reduce the impact of the risks identified. A number of amendments have been made including the introduction of a Heat Map providing a visual reflection of the Company's identified risks.

The key risks, being those classified as having the highest risk impact score post mitigation, are detailed below with a high-level summary of the management through mitigation any change in assessment over the past financial year. Within the categories, the risk level of some items has been elevated in the financial year to reflect the impact of various market conditions.

The Audit Committee has also considered the risks posed by COVID-19, which has been considered as a Black Swan event. Further information on how the Committee has considered COVID-19 when assessing its effect on the Company's ability to operate as a going concern and the Company's longer-term viability can be found in the Report of the Audit Committee.

 Principal Business Risks and Uncertainties      Management of Risks through Mitigation 
                                                  & Controls 
----------------------------------------------  ----------------------------------------------- 
 Business                                        ^ Increase* 
----------------------------------------------  ----------------------------------------------- 
 Failure to achieve investment objective,        The Board seeks to manage the impact 
  investment performance below agreed             of such risks through regular reporting 
  benchmark objective or market/industry          and monitoring of investment performance 
  average.                                        against a comparator group of open-ended 
                                                  funds, the Benchmark and other agreed 
                                                  indicators of relative performance. 
                                                  In months when the Board is not scheduled 
                                                  to meet, it receives a monthly report 
                                                  containing financial information 
                                                  on the Company including gearing 
                                                  and cash balances. 
                                                  Performance and strategy are reviewed 
                                                  throughout the year at regular Board 
                                                  meetings where the Board can challenge 
                                                  the Investment Manager. The Board 
                                                  also receives a monthly commentary 
                                                  from the Investment Manager in the 
                                                  form of factsheets for all the specialist 
                                                  financial sector funds managed by 
                                                  Polar Capital. 
                                                  The Board is committed to a clear 
                                                  communication programme to ensure 
                                                  shareholders understand the investment 
                                                  strategy. This is maintained through 
                                                  the use of monthly factsheets which 
                                                  have a market commentary from the 
                                                  Investment Manager as well as portfolio 
                                                  data, an informative website as well 
                                                  as annual and half year reports. 
                                                  The Management Engagement Committee 
                                                  considers the suitability of the 
                                                  Investment Manager on the basis of 
                                                  performance and other services provided. 
----------------------------------------------  ----------------------------------------------- 
 Loss of portfolio manager or other              Key personnel are incentivised by 
  key staff.                                      equity participation in the 
                                                  investment management company. 
                                                  The team directly responsible for 
                                                  managing the portfolio of the Company 
                                                  was increased from two to three in 
                                                  December 2020. 
----------------------------------------------  ----------------------------------------------- 
 *Persistent excessive share price               In consultation with its advisors, 
  discount to NAV.                                including the corporate broker, the 
                                                  Board regularly considers the level 
                                                  of the share price premium/discount 
                                                  to the NAV and the Board reviews 
                                                  ways to enhance shareholder value 
                                                  including share issuance and buy 
----------------------------------------------  ----------------------------------------------- 
 Principal Business Risks and Uncertainties      Management of Risks through Mitigation 
  PORTFOLIO MANAGEMENT                            & Controls 
                                                  ^ Increase* 
----------------------------------------------  ----------------------------------------------- 
 While the portfolio is diversified              The Board has set appropriate investment 
  across a number of stock markets                limits and monitors the position 
  worldwide, the investment mandate               of the portfolio against such. These 
  is focused on financials and thus               include guidelines on exposures to 
  the portfolio is more sensitive to              certain investment markets and sectors. 
  investor sentiment and the commercial           The Board discusses with the Investment 
  acceptance of the sector than a general         Manager at each Board meeting its 
  investment portfolio.                           views on the sector. 
  The Company's portfolio is exposed              At each Board meeting the composition 
  to risks such as market                         and diversification of the portfolio 
  price, credit, liquidity, foreign               by geographies, sectors and capitalisations 
  currency and interest rates.                    are considered along with sales and 
                                                  purchases of investments. Individual 
  The portfolio is actively managed.              investments are discussed with the 
  The Investment Manager's                        Investment Manager as well as the 
  style focuses primarily on the investment       Investment Manager's general views 
  opportunity of individual stocks                on the various investment markets 
  and, accordingly, may not follow                and the financials sector in particular. 
  the makeup of the Benchmark. This 
  may result in returns which are not             Analytical performance data and attribution 
  in line with the Benchmark.                     analysis is presented by the Investment 
  The degree of risk which the Investment 
  Manager incurs in order to generate             The policies for managing the risks 
  the investment returns and the effect           posed by exposure to market prices, 
  of gearing on the portfolio by borrowed         interest rates, foreign currency 
  funds can magnify the                           exchange rates, credit and liquidity 
  portfolio returns per share positively          are set out in Note 26 to the financial 
  or negatively.                                  statements. Investors have sight 
                                                  of the entire portfolio and geographic 
                                                  exposure of investments. 
----------------------------------------------  ----------------------------------------------- 
 Gearing, either through bank debt               The arrangement of any new banking 
  or the use of derivatives may be                facilities and gearing limits under 
  utilised from time to time. Whilst              such arrangements are controlled 
  the use of gearing is intended to               by the Board. Derivatives are considered 
  enhance the NAV total return, it                as being a form of gearing and their 
  will have the opposite effect when              use has been agreed by the Board. 
  the return on the Company's investment          The deployment of borrowed funds 
  portfolio is negative.                          (if any) is based on the Investment 
                                                  Manager's assessment of risk and 
                                                  At 30 November 2020 the Company was 
                                                  12.7% geared (2019:4.4%). 
----------------------------------------------  ----------------------------------------------- 
 *The ability to continue the dividend           The Board monitors income and currency 
  policy may be compromised due to                exposure through 
  lower income, either as a result                monthly management accounts and discussion. 
  of changes in underlying companies 
  policies or changes in the portfolio            In the event of there being insufficient 
  construction, regulatory intervention,          income during the financial year 
  or as a result                                  the Company has built up revenue 
  of the currency exposure underlying             reserves on 
  the portfolio. This could                       which to draw to pay dividends. Equally, 
  result in a lower level of dividend             in the event of the revenue reserves 
  being paid than intended or previously          being fully utilised the Company 
  paid.                                           may use other distributable reserves. 
----------------------------------------------  ----------------------------------------------- 
 Infrastructure                                  Management of Risks through Mitigation 
                                                  & Controls 
                                                  - Unchanged 
----------------------------------------------  ----------------------------------------------- 
 There are risks from the failure                At each Board meeting the Board receive 
  of, or disruption to, operational               an administration report that provides 
  and accounting systems and processes            details on general corporate matters 
  provided                                        including legislative and regulatory 
  by the Investment Manager including             developments and changes. 
  any subcontractors to which the Investment 
  Manager has delegated a task as well            The Board conducts an annual review 
  as directly appointed suppliers.                of suppliers and their internal control 
                                                  reports, which includes the disaster 
  The mis-valuation of investments                recovery procedures of the Investment 
  or the loss of assets from the custodian        Manager. 
  or sub custodians could affect the 
  NAV per share or lead to a loss of              Regular reporting from the Depositary 
  shareholder value.                              on the safe custody of the Company's 
                                                  assets and the operation of control 
  There is taxation risk that the Company         systems related to the portfolio 
  may fail to continue as an investment           reconciliation is monitored. 
  trust and suffer capital gains tax 
  or fail to recover as fully as possible         Specialist advice is sought on taxation 
  withholding taxes on overseas investments.      issues as and when required. The 
                                                  Audit Committee has oversight of 
  The legal and regulatory risks include          such work. Information and guidance 
  failure to comply with the FCA's                on legal and regulatory risks is 
  Prospectus Rules, Listing Rules and             managed by using the Investment Manager 
  Disclosure Guidance and Transparency            or professional advisers where necessary 
  Rules; not meeting the provisions               and the submission of reports to 
  of the Companies Act 2006 and other             the Board for discussion and, if 
  UK and overseas legislation affecting           required, any remedial action or 
  UK companies and not complying with             changes considered necessary. 
  accounting standards. Further risks 
  arise from not keeping abreast of               The Board monitors new developments 
  changes in legislation and regulations          and changes in the regulatory environment. 
  which have in recent years been substantial.    Whilst it has no control over such 
                                                  changes, the Board seeks to ensure 
                                                  that their impact on the Company 
                                                  is understood and complied with. 
----------------------------------------------  ----------------------------------------------- 
 Principal Business Risks and Uncertainties      Management of Risks through Mitigation 
  External                                        & Controls 
                                                  ^ Increase* 
----------------------------------------------  ----------------------------------------------- 
 *There is significant exposure to               The Board regularly discusses general 
  the economic cycles of the markets              economic conditions and developments. 
  in which the underlying investments 
  conduct their business operations               The effect on the portfolio from 
  as well as the economic impact on               Brexit continues to be considered. 
  investment markets where such investments       Whilst it is difficult to quantify 
  are listed.                                     the impact of such a change, it is 
                                                  not believed to fundamentally impact 
  *The fluctuations of exchange rates             the business of the Company or to 
  can also have a material impact on              make the financials sector any less 
  shareholder returns.                            attractive as an investment. At the 
                                                  year-end over 80.9% of the portfolio 
                                                  was invested outside of the EEA. 
                                                  In early 2020, the COVID-19 pandemic 
                                                  affected economies and businesses 
                                                  globally and prompted regulator intervention. 
                                                  The Board acknowledge the short-term 
                                                  impact this has had on underlying 
                                                  companies' ability to pay dividends 
                                                  and share price volatility. The Board 
                                                  continue to monitor the effects of 
                                                  COVID-19 in order to establish any 
                                                  potential longer-term impact which 
                                                  is yet to occur. 
                                                  Note 26 in the Annual Report describes 
                                                  the risks posed by changes in foreign 
                                                  exchange rates. The Investment Manager 
                                                  has the ability to hedge foreign 
                                                  currency if it is thought appropriate 
                                                  at the time. 
----------------------------------------------  ----------------------------------------------- 

Investment Management Company and Management of the Portfolio

As the Company is an investment vehicle for shareholders, the Directors have sought to ensure that the business of the Company is managed by a leading specialist investment management team and that the investment strategy is attractive to shareholders. The Directors believe that a strong working relationship with the Investment Manager will achieve the optimum return for shareholders. As such, the Board and the Investment Manager operate in a supportive, co-operative and open environment.

The Company has an Investment Management Agreement (IMA) with Polar Capital LLP (the Investment Manager), which is authorised and regulated by the Financial Conduct Authority, to act as Investment Manager and AIFM of the Company with sole responsibility for the discretionary management of the Company's assets (including uninvested cash) and sole responsibility to take decisions as to the purchase and sale of individual investments. The Investment Manager also has responsibility for asset allocation within the limits of the investment policy and guidelines established and regularly reviewed by the Board, all subject to the overall control and supervision of the Board.

Polar Capital provides a team of financial specialists and the portfolio is jointly managed by Mr Nick Brind, Mr John Yakas and Mr George Barrow, supported by other financials specialists within the team.

The Investment Manager has other investment resources which support the investment team and has experience in administering and managing other investment companies.

The Investment Manager also procures or provides accountancy services, company secretarial, marketing and day to day administrative services, including the monitoring of third-party suppliers, which are directly appointed by the Company. The Investment Manager has, with the consent of the Directors, delegated the provision of certain of these administrative functions to HSBC Securities Services and to Polar Capital Secretarial Services Limited. The fees of HSBC Securities Services are paid by the Company.

Information is provided to the Directors on a timely basis, covering all aspects of relevant management, regulatory and financial information. The Board receives a report from the Investment Manager at each Board meeting and may ask representatives of the Investment Manager to attend Board meetings enabling Directors to probe further on matters of concern or seek clarification as appropriate.

While the Board reviews the performance of the Investment Manager at each Board meeting, and the Company's performance against Benchmark and a peer group of funds with similar objectives, the Management Engagement Committee formally carries out an annual review of the Investment Manager's and other suppliers' performance during the year.

Termination Arrangements

The IMA may be terminated by either party giving 12 months' notice. The IMA may be terminated earlier by the Company with immediate effect on the occurrence of certain events, including: (i) if an order has been made or an effective resolution passed for the liquidation of the Investment Manager; (ii) if the Investment Manager ceases or threatens to cease to carry on its business; (iii) where the Company is required to do so by a relevant regulatory authority; (iv) on the liquidation of the Company; or (v) subject to certain conditions, where the Investment Manager commits a material breach of the IMA.

In the event the IMA is terminated by the Company, except in the event of termination by the Company for certain specified causes, the base fee and the performance fee will be calculated pro rata for the period up to and including the date of termination.

Fee Arrangements

Management Fee

Under the terms of the IMA, the Investment Manager will be entitled to a management fee together with reimbursement of reasonable expenses incurred by it in the performance of its duties. Following shareholder approval of the Amended and Restated IMA, effective from 7 April 2020, the Investment Manager is entitled to a reduced base fee rate of 0.70% per annum of the Company's NAV (previously 0.85% per annum of the lower of the Company's market capitalisation and NAV).

In accordance with the Directors' policy on the allocation of expenses between income and capital, in each financial year 80% of the management fee payable is charged to capital and the remaining 20% to revenue.

Performance Fee

The Investment Manager may be entitled to a performance fee equal to 10% of the excess of the performance fee hurdle and payable at the end of each five-year period, the first period being from 23 April 2020 to 30 June 2025 and at five-yearly intervals thereafter.

For the purposes of calculating the performance fee, the Company's NAV (adjusted to reflect dividends paid, and any performance impact caused by the issue or buyback of ordinary shares) at 30 June 2025, being the end of the relevant Performance Period, will be used. As at 30 November 2020, a GBP1,269,000 performance fee had been accrued. Where a performance fee becomes payable it will be charged 100% to capital.

Corporate Responsibility

Environment, Social and Governance (ESG)

The Company's core activities are undertaken by its Investment Manager which seeks to limit the use of nonrenewable resources and reduce waste where possible. The Investment Manager has a corporate ESG policy and wherever possible and appropriate the parameters of such are considered and adopted by the investment team in relation to the Company's management and portfolio construction. As detailed further within the Investment Manager's Report, the Investment Managers consider ESG factors when reviewing new, continuing or exiting investments but they do not make an investment decision solely on the basis of ESG factors. The Board monitors the Investment Manager's approach to ESG and they themselves take into account ESG factors in the management of the Company.

The Companies Act 2006 (Strategic Report and Directors' Reports) Regulations 2013 require companies listed on the Main Market of the London Stock Exchange to report on the greenhouse gas ('GHG') emissions and the Task Force on Climate-related Financial Disclosures for which they are responsible. The Company is an investment trust, with neither employees nor premises, nor has it any financial or operational control of the assets which it owns. Consequently, it has no GHG emissions or climate disclosures to report from its operations nor does it have responsibility for any other emissions.

Diversity and gender reporting

The Company has no employees and the Board comprises two female and two male Non-executive Directors.

The Board has adopted a succession plan based on the recommended nine-year tenure of Directors with allowance for an extended period for the role of the Chairman should it be needed to undertake recruitment or practical handover period. The Board will continue to have regard to the benefits of diversity throughout any recruitment process, especially during compiling a shortlist of candidates and selecting individuals for interview, but will ultimately seek to ensure directors appointed to the Board are chosen on merit.

Whilst the Company has not adopted formal policies on human rights or diversity as it has no employees or operational control of its assets, the Board will always give regard to diversity when recruiting.

Modern Slavery Act

As an investment company, the Company does not provide goods or services in the normal course of business and does not have any customers. Accordingly, it is considered that the Company is not required to make any slavery or human trafficking statements under the Modern Slavery Act 2015.

Anti-bribery, Corruption and Tax Evasion

The Board has adopted a zero-tolerance policy (available on the Company's website) to bribery, corruption and the facilitation of tax evasion in its business activities. The Board uses the principles formulated and implemented by the Investment Manager and expects the same standard of zero-tolerance to be adopted by third party service providers.

The Company has implemented a Conflicts of Interest policy to which the Directors must adhere. In the event of divergence between the Investment Manager's policy and the Company's policy the Company's policy shall prevail. The Company is committed to acting with integrity and in the interests of all stakeholders.

Section 172 of the Companies Act 2006

The statutory duties of the Directors are listed in s171-177 of the Companies Act 2006. Under s172, Directors have a duty to promote the success of the Company for the benefit of its members (our shareholders) as a whole and in doing so have regard to the consequences of any decision in the long term, as well as having regard to the Company's stakeholders amongst other considerations. The fulfilment of this duty not only helps the Company achieve its Investment Objective but ensures decisions are made in a responsible and sustainable way for shareholders.

To ensure that the Directors are aware of, and understand, their duties, they are provided with an induction, including details of all relevant regulatory and legal duties as a Director when they first join the Board, and continue to receive regular updates on relevant legislative and regulatory developments. They also have ongoing access to the advice and services of the Company Secretary and, when deemed necessary, the Directors can seek independent professional advice. The Schedule of Matters Reserved for the Board, as well as the Terms of Reference of its committees are reviewed annually and further describe Directors' responsibilities and obligations and include any statutory and regulatory duties.

The Board seeks to understand the needs and priorities of the Company's stakeholders and these are taken into account during all of its discussions and as part of its decision-making. As an externally managed investment company, the Company does not have any employees or customers, however the key stakeholders and a summary of the Board's consideration and actions where possible in relation to each group of stakeholders are described in the table below.

 Stakeholder Group    How we engage with them 
 Shareholders         The Directors have considered this duty when 
                       making strategic decisions during the year 
                       that affect shareholders. Most notably, the 
                       proposals made to shareholders in April 2020 
                       in relation to the tender offer and removal 
                       of the fixed seven-year end of life in favour 
                       of five-yearly tender offers. The proposals 
                       were approved by representation of over 60% 
                       of the total issued share capital and 100% 
                       of the votes cast at the General Meeting on 
                       7 April 2020. The Directors have also taken 
                       account of shareholders' interests during the 
                       year when considering the continued appointment 
                       of the Investment Manager and the recommendation 
                       that shareholders vote in favour of the resolutions 
                       for the Company to continue and to renew the 
                       allotment and buy back authorities at the AGM. 
                       Shortly before the year end, market sentiment 
                       towards the financials sector improved and 
                       the Company's shares started trading at a small 
                       premium to NAV. As a result, regular share 
                       issues out of the shares held in treasury were 
                       conducted. To enable the Company to continue 
                       issuing shares expeditiously, shareholder soundings 
                       were taken and a shareholder circular was sent 
                       out on 14 January 2021 to put forward a proposal 
                       to disapply pre-emption rights over all shares 
                       within the treasury account at the date of 
                       the meeting. A General Meeting was held on 
                       1 February 2021, 65.3% of the issued share 
                       capital was voted on the resolution to disapply 
                       pre-emption rights over the shares held in 
                       treasury, 68.1m shares at the date of the meeting, 
                       of those votes cast, 96.9% were cast on favour. 
                       Given the continued measures in place in relation 
                       to social distancing and COVID-19, the Directors 
                       have carefully considered the viability of 
                       an open forum AGM. The safety and wellbeing 
                       of shareholders is of the highest priority 
                       and it has therefore been decided that a closed 
                       AGM will be held again this year. In the event 
                       that restrictions are lifted the Company will 
                       make a regulatory announcement detailing any 
                       changes to the arrangements for the meeting. 
                       The Board believes that shareholder engagement 
                       remains important, especially in the current 
                       market conditions, and to facilitate shareholder 
                       engagement, shareholders are encouraged to 
                       submit any specific questions on the business 
                       of the AGM and Resolutions being proposed by 
                       e-mail in advance of the Meeting to 
                       (subject marked 'PCFT AGM'). Questions deemed 
                       appropriate and relevant will be responded 
                       to by email as soon as possible following receipt 
                       and where possible ahead of the AGM. 
                       Should any significant votes be cast against 
                       a resolution, the Board will engage with shareholders 
                       and explain in its announcement of the results 
                       of the AGM the actions it intends to take to 
                       consult shareholders in order to understand 
                       the reasons behind the votes against. Following 
                       the consultation, an update will be published 
                       no later than six months after the AGM and 
                       the Annual Report will detail the impact the 
                       Shareholder feedback has had on any decisions 
                       the Board has taken and any actions or resolutions 
                       Relations with shareholders 
                       The Board and the Manager consider maintaining 
                       good communications and engaging with shareholders 
                       through meetings and presentations a key priority. 
                       The Board regularly considers the share register 
                       of the Company and receives regular reports 
                       from the Manager and the Corporate Broker on 
                       meetings attended with shareholders and any 
                       concerns that are raised in those meetings. 
                       The Board also reviews any correspondence from 
                       shareholders and may attend investor presentations. 
                       Shareholders are able to raise any concerns 
                       directly with the Board without using the Manager 
                       or Company Secretary as a conduit. The Chairman 
                       or other Directors are available to shareholders 
                       who wish to raise matters either in person 
                       or in writing. The Chairman and Directors may 
                       be contacted through the registered office 
                       of the Company. 
                       Shareholders are kept informed by the publication 
                       of annual and half year reports, monthly fact 
                       sheets, access to commentary from the Investment 
                       Manager published on the Company's website 
                       and attendance at events at which the Investment 
                       Manager presents. 
                       The Company, through the sales and marketing 
                       efforts of the Investment Manager, encourages 
                       retail investment platforms to engage with 
                       underlying shareholders in relation to Company 
                       communications and enable those shareholders 
                       to cast their votes on Shareholder resolutions; 
                       the Company however has no responsibility over 
                       such platforms. The Board therefore encourage 
                       shareholders invested via platforms to regularly 
                       visit the Company's website or to make contact 
                       with the Company directly to obtain copies 
                       of Shareholder communications. 
                       The Company has also made arrangements with 
                       its registrar for shareholders, who own their 
                       shares directly rather than through a nominee 
                       or share scheme, to view their account online 
                       at Other services are 
                       also available via this website. 
 Investment Manager        Through the Board meeting cycle, regular updates 
                            and the work of the Management Engagement Committee 
                            in reviewing the services of the Investment 
                            Manager annually, the Board is able to safeguard 
                            Shareholder interests by: 
                             *    Ensuring adherence to the Investment Policy; 
                             *    Ensuring excessive risk is not undertaken in the 
                                  pursuit of investment performance; 
                             *    Ensuring adherence to the Investment Management 
                                  Policy and reviewing the agreed management and 
                                  performance fees; and 
                             *    Reviewing the Investment Manager's decision making 
                                  and consistency of its investment process. 
                            Maintaining a close and constructive working 
                            relationship with the Manager is crucial as 
                            the Board and the Investment Manager both aim 
                            to continue to deliver consistent, long-term 
                            returns in line with the Investment Objective. 
                            The culture which the Board maintains to achieve 
                            this involves encouraging open discussion with 
                            the Investment Manager, ensuring that the interests 
                            of shareholders and the Investment Manager 
                            are aligned, providing constructive challenge 
                            and making Directors' experience available 
                            to support the Investment Manager. This culture 
                            is aligned with the collegiate and meritocratic 
                            culture which Polar Capital has developed and 
                            Outcomes and strategic decisions during the 
                            The Board in its capacity as the Management 
                            Engagement Committee has recommended the continued 
                            appointment of the Investment Manager on the 
                            terms agreed within the Investment Management 
                            The proposals put forward in April 2020, to 
                            continue the Company and remove the fixed life 
                            element, were made with and in support of the 
                            Investment Manager continuing to manage the 
                            assets of the Company. 
 Investee Companies   The Board has instructed the Investment Manager 
                       to take into account the published corporate 
                       governance policies of the companies in which 
                       they invest. 
                       The Board has also considered the Investment 
                       Manager's Stewardship Code and Proxy Voting 
                       Policy. The Proxy Voting Policy directs the 
                       Investment Manager to vote at all general meetings 
                       of companies in line with Institutional Shareholder 
                       Services ("ISS") policy. However, in exceptional 
                       cases, where the Investment Manager believes 
                       that a resolution would be detrimental to the 
                       interests of shareholders or the financial 
                       performance of the Company, appropriate notification 
                       will be given and abstentions or a vote against 
                       will be lodged. This Policy changed during 
                       the financial year, as the prior default instruction 
                       had been for the Investment Manager to vote 
                       at all general meetings of companies in favour 
                       of management's recommendation. 
                       The Investment Manager voted at 67 company 
                       meetings over the year ended November 2020, 
                       with 4% of all votes being against management 
                       and 28% of meetings having at least one against 
                       or withheld vote. 
                       The Investment Manager reports to the Board, 
                       when requested, on the application of the Stewardship 
                       Code and Voting Policy. The Investment Manager's 
                       Stewardship Code and Voting Policy can be found 
                       on the Investment Manager's website in the 
                       Corporate Governance section ( 
                       Further information on how the Investment Manager 
                       considers ESG in its engagement with investee 
                       companies can be found in the Investment Manager's 
                       Outcomes and strategic decisions during the 
                       During the year, the Board discussed the impact 
                       of ESG and how the Investment Manager incorporated 
                       ESG into their strategy and investment process. 
 Service Providers    The Directors have frequent engagement with 
                       the Company's service providers through the 
                       annual cycle of reporting and due diligence 
                       meetings or site visits. This engagement is 
                       undertaken with the aim of having effective 
                       oversight of delegated services, seeking to 
                       improve the processes for the benefit of the 
                       Company and to understand the needs and views 
                       of the Company's service providers, as stakeholders 
                       in the Company. Further information on the 
                       Board's engagement with service providers is 
                       included in the Corporate Governance Statement 
                       and the Report of the Audit Committee. Due 
                       to the ongoing restrictions in connection with 
                       COVID-19, due diligence meetings have, in the 
                       year under review, been undertaken by the Investment 
                       Manager in a virtual fashion and where possible, 
                       service providers have joined video conference 
                       meetings to present their reports directly 
                       to the Board or the Audit Committee as appropriate. 
                       Outcomes and strategic decisions during the 
                       The reviews of the Company's service providers 
                       have been positive and the Directors believe 
                       their continued appointment is in the best 
                       interests of shareholders. The accounting and 
                       administration services of HSBC Securities 
                       Services (HSS) are contracted through Polar 
                       Capital and provided to the Company under the 
                       terms of the IMA. However, the Board continue 
                       to conduct due diligence service reviews in 
                       conjunction with the Company Secretary and 
                       is satisfied that the service received continues 
                       to be of a high standard. The contractual relationship 
                       with the corporate broker was changed during 
                       the year under review, Investec Bank plc resigned 
                       and Stifel Nicolaus Europe were appointed as 
                       sole corporate broker to the Company. 
 Proxy Advisors       The support of the major institutional investors 
                       and proxy adviser agencies is important to 
                       the Directors, as the Company seeks to retain 
                       a reputation for high standards of corporate 
                       governance, which the Directors believe contributes 
                       to the long-term sustainable success of the 
                       Company. The Directors consider the recommendations 
                       of these various proxy voting agencies when 
                       contemplating decisions that will affect shareholders 
                       and also when reporting to shareholders through 
                       the Half Year and Annual Reports. 
                       Recognising the principles of stewardship, 
                       as promoted by the UK Stewardship Code, the 
                       Board welcomes engagement with all of its investors. 
                       The Board recognises that the questions from 
                       and the views and recommendations of many institutional 
                       investors and proxy adviser agencies provide 
                       a valuable feedback mechanism and play a part 
                       in highlighting evolving shareholder expectations 
                       and concerns. 
                       Prior to AGMs, the Company engages with these 
                       agencies to fact check their advisory reports 
                       and clarify any areas or topics that the agency 
                       requests. This ensures that whilst the proxy 
                       advisory reports provided to shareholders are 
                       objective and independent, the Company's actions 
                       and intentions are represented as clearly as 
                       possible to assist with shareholders' decision 
                       making when considering the resolutions proposed 
                       at the AGM. 
                       Outcomes and strategic decisions during the 
                       The Nomination Committee considers the time 
                       commitment required of Directors and the Board 
                       considers each Director's independence on an 
                       ongoing basis. The Board has confirmed that 
                       all Directors remain independent and able to 
                       commit sufficient time to fulfilling their 
                       duties, including those listed on s172 of the 
                       Companies Act. Accordingly, all Directors are 
                       standing for re-election at the Company's AGM. 
                       When undertaking recruitment, the Board will 
                       have regard to all forms of diversity, although 
                       the aim will always be to ensure there are 
                       appropriately qualified individuals to manage 
                       the Company in the interests of shareholders. 
 AIC                  The Company is a member of the AIC and has 
                       supported lobbying activities such as the consultation 
                       on the 2019 AIC Code. The Directors also cast 
                       votes in the AIC Board Elections each year 
                       and regularly attend AIC events. 

Approved by the Board on 22 February 2021.

By order of the Board

Tracey Lago FCG

Polar Capital Secretarial Services Limited

Company Secretary


The Directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulation.

Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have prepared the financial statements in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006. 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 Company and of the profit or loss of the Company for that period. In preparing the financial statements, the Directors are required to:

   --      Select suitable accounting policies and then apply them consistently; 

-- state whether applicable accounting standards have been followed subject to any material departures disclosed and explained in the financial statements;

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

-- Prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.

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

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 Company and enable them to ensure that the financial statements and the Directors' Remuneration Report comply with the Companies Act 2006.

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.

Directors' confirmations

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 Company's position and performance, business model and strategy.

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

-- the Company financial statements, which have been prepared in accordance applicable accounting standards, give a true and fair view of the assets, liabilities, financial position and loss of the Company; and

-- the Strategic Report includes a fair review of the development and performance of the business and the position of the Company, 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:

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

-- 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 Company's auditors are aware of that information.

Robert Kyprianou


22 February 2021

Statement of Comprehensive Income

For the year ended 30 November 2020

                                          Year ended 30 November        Year ended 30 November 
                                                   2020                          2019 
------------------------------  -----  ----------------------------  ---------------------------- 
                                        Revenue   Capital     Total   Revenue   Capital     Total 
                                         return    return    return    return    return    return 
                                Notes   GBP'000   GBP'000   GBP'000   GBP'000   GBP'000   GBP'000 
------------------------------  -----  --------  --------  --------  --------  --------  -------- 
Investment income                   3     6,297         -     6,297    12,021         -    12,021 
Other operating income              4         7         -         7        36         -        36 
(Losses)/gains on investments 
 held at fair value                 5         -  (47,908)  (47,908)         -    20,925    20,925 
Other currency losses               6         -     (506)     (506)         -      (76)      (76) 
Total income                              6,304  (48,414)  (42,110)    12,057    20,849    32,906 
------------------------------  -----  --------  --------  --------  --------  --------  -------- 
Investment management 
 fee                                7     (299)   (1,195)   (1,494)     (461)   (1,846)   (2,307) 
Performance Fee                     7         -   (1,269)   (1,269)         -         -         - 
Other administrative 
 expenses                           8     (629)      (11)     (640)     (646)      (15)     (661) 
------------------------------  -----  --------  --------  --------  --------  --------  -------- 
Total expenses                            (928)   (2,475)   (3,403)   (1,107)   (1,861)   (2,968) 
------------------------------  -----  --------  --------  --------  --------  --------  -------- 
(Loss)/profit before 
 finance costs and tax                    5,376  (50,889)  (45,513)    10,950    18,988    29,938 
Finance costs                       9      (61)     (241)     (302)      (60)     (242)     (302) 
------------------------------  -----  --------  --------  --------  --------  --------  -------- 
(Loss)/profit before 
 tax                                      5,315  (51,130)  (45,815)    10,890    18,746    29,636 
Tax                                10     (661)       147     (514)     (967)       237     (730) 
------------------------------  -----  --------  --------  --------  --------  --------  -------- 
Net (loss)/profit for 
 the year and 
 total comprehensive 
 (expense)/income                         4,654  (50,983)  (46,329)     9,923    18,983    28,906 
------------------------------  -----  --------  --------  --------  --------  --------  -------- 
(Losses)/earnings per 
 share (pence)                     11      3.01   (33.01)   (30.00)      4.89      9.36     14.25 
------------------------------  -----  --------  --------  --------  --------  --------  -------- 

The total return column of this statement represents the Company's Statement of Comprehensive Income, prepared in accordance with IFRS.

The revenue return and capital return columns are supplementary to this and are prepared under guidance published by the Association of Investment Companies.

The amounts dealt with in the Statement of Comprehensive Income are all derived from continuing activities.

The notes to follow form part of these financial statements.

Statement of Changes in Equity

For the year ended 30 November 2020

                                                               Year ended 30 November 2020 
----------------------------  -----  ------------------------------------------------------------------------------- 
                                        Called      Capital     Share         Special 
                                      up share   redemption   premium   distributable    Capital   Revenue     Total 
                                       capital      reserve   reserve         reserve   reserves   reserve    equity 
                              Notes    GBP'000      GBP'000   GBP'000         GBP'000    GBP'000   GBP'000   GBP'000 
----------------------------  -----  ---------  -----------  --------  --------------  ---------  --------  -------- 
Total equity at 1 
 December 2019                          10,139          251    55,854         139,235     86,452     9,239   301,170 
Total comprehensive 
 (expense)/ income: 
 (Loss)/profit for 
 the year ended 30 
 November 2020                               -            -         -               -   (50,983)     4,654  (46,329) 
Transactions with 
 owners, recorded 
 directly to equity: 
Issues of shares 
 out of treasury                 15          -            -        36             106          -         -       142 
Shares bought back 
 into treasury pursuant 
 to tender offer (including 
 costs)                          15          -            -         -        (81,568)          -         -  (81,568) 
Shares bought back 
 and held in treasury            15          -            -         -           (662)          -         -     (662) 
Equity dividends 
 paid                            12          -            -         -               -          -   (7,010)   (7,010) 
----------------------------  -----  ---------  -----------  --------  --------------  ---------  --------  -------- 
Total equity at 30 
 November 2020                          10,139          251    55,890          57,111     35,469     6,883   165,743 
----------------------------  -----  ---------  -----------  --------  --------------  ---------  --------  -------- 
                                                        Year ended 30 November 2019 
--------------------  ------  ------------------------------------------------------------------------------- 
                                 Called      Capital     Share         Special 
                               up share   redemption   premium   distributable    Capital   Revenue     Total 
                                capital      reserve   reserve         reserve   reserves   reserve    equity 
                       Notes    GBP'000      GBP'000   GBP'000         GBP'000    GBP'000   GBP'000   GBP'000 
--------------------  ------  ---------  -----------  --------  --------------  ---------  --------  -------- 
Total equity at 1 
 December 2018                   10,139          251    55,854         139,235     67,469     8,036   280,984 
Total comprehensive 
Profit for the year 
 30 November 2019                     -            -         -               -     18,983     9,923    28,906 
Transactions with 
 recorded directly 
 to equity: 
Equity dividends 
 paid                                 -            -         -               -          -   (8,720)   (8,720) 
----------------------------  ---------  -----------  --------  --------------  ---------  --------  -------- 
Total equity at 30 
 November 2019                   10,139          251    55,854         139,235     86,452     9,239   301,170 
----------------------------  ---------  -----------  --------  --------------  ---------  --------  -------- 

The notes to follow form part of these financial statements.

Balance Sheet

As at 30 November 2020

                                                    30 November  30 November 
                                                           2020         2019 
                                             Notes      GBP'000      GBP'000 
-------------------------------------------  -----  -----------  ----------- 
Non-current assets 
Investments held at fair value through 
 profit or loss                                 13      188,011      313,605 
-------------------------------------------  -----  -----------  ----------- 
Current assets 
Receivables                                                 416          807 
Overseas tax recoverable                                    273          316 
Cash and cash equivalents                       14          140        4,175 
-------------------------------------------  -----  -----------  ----------- 
                                                            829        5,298 
-------------------------------------------  -----  -----------  ----------- 
Total assets                                            188,840      318,903 
-------------------------------------------  -----  -----------  ----------- 
Current liabilities 
Payables                                                (2,814)      (2,858) 
Bank overdraft                                            (383)      (4,875) 
Bank loan                                              (19,900)     (10,000) 
                                                       (23,097)     (17,733) 
-------------------------------------------  -----  -----------  ----------- 
Net assets                                              165,743      301,170 
-------------------------------------------  -----  -----------  ----------- 
Equity attributable to equity shareholders 
Called up share capital                         15       10,139       10,139 
Capital redemption reserve                                  251          251 
Share premium reserve                                    55,890       55,854 
Special distributable reserve                            57,111      139,235 
Capital reserves                                         35,469       86,452 
Revenue reserve                                           6,883        9,239 
-------------------------------------------  -----  -----------  ----------- 
Total equity                                            165,743      301,170 
-------------------------------------------  -----  -----------  ----------- 
Net asset value per ordinary share 
 (pence)                                        16       134.70       148.52 
-------------------------------------------  -----  -----------  ----------- 

The financial statements, including the associated notes, were approved and authorised for issue by the Board of Directors

on 22 February 2021 and signed on its behalf by:

Robert Kyprianou


   The notes to follow   form part of these financial statements. 

Registered number: 8534332

Cash Flow Statement

For the year ended 30 November 2020

                                                       Year ended    Year ended 
                                                      30 November   30 November 
                                                             2020          2019 
                                              Notes       GBP'000       GBP'000 
--------------------------------------------  -----  ------------  ------------ 
Cash flows from operating activities 
(Loss)/profit before tax                                 (45,815)        29,636 
Adjustment for non-cash items: 
Losses/(gains) on investments held 
 at fair value through profit or loss                      47,908      (20,925) 
Scrip dividends received                                     (92)         (125) 
Amortisation on fixed interest securities                   (122)         (110) 
--------------------------------------------  -----  ------------  ------------ 
Adjusted profit before tax                                  1,879         8,476 
Adjustments for: 
Purchases of investments, including 
 transaction costs                                      (111,398)      (76,222) 
Sales of investments, including transaction 
 costs                                                    187,901        73,210 
Decrease in receivables                                       533            65 
Increase/(decrease) in payables                             1,353          (10) 
Overseas taxation deducted at source                        (471)         (862) 
--------------------------------------------  -----  ------------  ------------ 
Net cash generated from operating 
 activities                                                79,797         4,657 
--------------------------------------------  -----  ------------  ------------ 
Cash flows from financing activities 
Shares repurchased from tender offer 
 treasury (including costs)                              (81,568)             - 
Shares repurchased into treasury                            (662)             - 
Loan repaid *                                             (7,500)       (5,000) 
Loan drawn *                                               17,400             - 
Equity dividends paid                            12       (7,010)       (8,720) 
--------------------------------------------  -----  ------------  ------------ 
Net cash used in financing activities                    (79,340)      (13,720) 
--------------------------------------------  -----  ------------  ------------ 
Net increase/(decrease) in cash and 
 cash equivalents                                             457       (9,063) 
Cash and cash equivalents at the 
 beginning of the year                                      (700)         8,363 
--------------------------------------------  -----  ------------  ------------ 
Cash and cash equivalents at the 
 end of the year                                 14         (243)         (700) 
--------------------------------------------  -----  ------------  ------------ 

* 2019 re-presented to exclude non-cash items, see details in note 17 in the Annual Report.

The notes to follow form part of these financial statements.

Notes to the Financial Statements

For the year ended 30 November 2020

   1              General Information 

The financial statements have been prepared in accordance with international accounting standards in conformity with the

requirements, including the applicable legal requirements, of the Companies Act 2006 which, post the Brexit transition period

which ended on 31 December 2020, encompasses IFRS.

The Board has determined that sterling is the Company's functional currency and the presentational currency of the financial statements because it is the currency which is most relevant to the majority of the Company's shareholders and creditors and is the currency in which the majority of the Company's operating expenses are paid. All figures are rounded to the nearest thousand pounds (GBP'000) except as otherwise stated.

   2              Accounting Policies 

The principal accounting policies, which have been applied consistently for all years presented, are set out below:

   (a)   Basis of Preparation 

The financial statements have been prepared on a going concern basis under the historical cost convention, as modified by the revaluation of investments and derivative financial instruments at fair value through profit or loss.

Where presentational guidance set out in the Statement of Recommended Practice (SORP) for investment trusts issued by the Association of Investment Companies (AIC) in October 2019, is consistent with the requirements of IFRS, in so far as those requirements are applicable to the financial statements, the Directors have sought to prepare the financial statements on a basis compliant with the recommendations of the SORP.

The financial position of the Company as at 30 November 2020 is shown in the balance sheet. As at 30 November 2020 the Company's total assets exceeded its total liabilities by a multiple of over 8. The assets of the Company consist mainly of securities that are held in accordance with the Company's investment Policy, as set out above and these securities are readily realisable. The Directors have considered a detailed assessment of the Company's ability to meets its liabilities as they fall due including assessing the implications of the Company's net current liabilities position as at 30 November 2020.

The assessment took account of the Company's current financial position, its cash flows and its liquidity position. In the unlikely event that the loan facilities are not renewed in or before July 2021, the Board is satisfied that the Company could fund the repayment and ongoing cash flow requirements through the sale of a portion of the portfolio of listed securities . In addition to the assessment, the Company carried out stress testing, including for the impact of COVID-19, which used a variety of falling parameters to demonstrate the effects on the Company's share price and net asset value. In light of the results of these tests, the Company's cash balances, and the liquidity position, the Directors consider that the Company has adequate financial resources to enable it to continue in operational existence. Accordingly, the Directors believe that it is appropriate to continue to adopt the going concern basis in preparing the Company's financial statements.

   (b)   Presentation of the 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 Statement of Comprehensive Income between items of a revenue and capital nature has been presented alongside the Statement of Comprehensive Income. The result presented in the revenue return column is the measure the Directors believe appropriate in assessing the Company's compliance with certain requirements set out in Section 1158 of the Corporation Tax Act 2010.

   (c)    Income 

Dividends receivable from equity shares are taken to the revenue return column of the Statement of Comprehensive Income on an ex-dividend basis.

Special dividends are recognised on an ex-dividend basis and may be considered to be either revenue or capital items. The facts and circumstances are considered on a case-by-case basis before a conclusion on appropriate allocation is reached.

Where the Company has received dividends in the form of additional shares rather than in cash, the amount of the cash dividend foregone is recognised in the revenue return column of the Statement of Comprehensive Income. Any excess in value of shares received over the amount of cash dividend foregone is recognised in the capital return column of the Statement of Comprehensive Income.

The fixed returns on debt securities and non-equity shares are recognised under the effective interest rate method.

Bank interest is accounted for on an accrual basis. Interest outstanding at the year end is calculated on a time apportionment basis using market rates of interest.

   (d)   Written Options 

The Company may write exchange-traded options with a view to generating income. This involves writing short-dated covered call options and put options. The use of financial derivatives is governed by the Company's policies, as approved by the Board.

These options are recorded initially at fair value, based on the premium income received, and are then measured at subsequent reporting dates at fair value. Changes in the fair value of the options are recognised in the capital return for the year.

The option premiums are recognised evenly over the life of the option and shown in the revenue return, with an appropriate amount shown in the capital return to ensure the total return reflects the overall change in the fair value of the options.

Where an option is exercised, any balance of the premium is recognised immediately in the revenue return with a corresponding adjustment in the capital return based on the amount of the loss arising on exercise of the option.

   (e)   Expenses and Finance Costs 

All expenses, including the management fee, are accounted for on an accrual basis.

Expenses are allocated wholly to the revenue column of the Statement of Comprehensive Income except as follows:

Expenses are charged to the capital column of the Statement of Comprehensive Income where a connection with the maintenance or enhancement of the value of investments can be demonstrated. In this respect the investment management fees have been charged to the Statement of Comprehensive Income in line with the Board's expected long-term split of returns, in the form of capital gains and income from the Company's portfolio. As a result, 20% of the investment management fees are charged to the revenue account and 80% charged to the capital account of the Statement of Comprehensive Income.

Finance costs are calculated using the effective interest rate method and are accounted for on an accruals basis and, in line with the management fee expense, are charged 20% to the revenue account and 80% to the capital account of the Statement of Comprehensive Income.

Any performance fee accrued is charged entirely to capital as the fee is based on the outperformance of the Benchmark and is expected to be attributable largely, if not wholly, to capital performance. A provision will be recognised when outperformance has been achieved in accordance with the calculations detailed above and in the Annual Report.

The research costs relate solely to specialist financial research and are accounted for on an accrual basis. They are allocated 20% to revenue and 80% to capital in line with the expected long-term split of revenue and capital return from the Company's investment portfolio.

   (f)    Taxation 

The tax expense represents the sum of the overseas withholding tax deducted from investment income, tax currently payable and deferred tax.

The tax currently payable is based on the taxable profits for the year ended 30 November 2020. Taxable profit differs from net profit as reported in the 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 Company's liability for current tax is calculated using tax rates that have been enacted or substantively enacted at the balance sheet date.

In line with the recommendations of the SORP, the allocation method used to calculate tax relief on expenses presented against capital returns in the supplementary information in the 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 Statement of Comprehensive Income, then no tax relief is transferred to the capital return column.

Deferred tax is the tax expected to be payable or recoverable on temporary differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities are recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised.

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

The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or when the asset is realised based on tax rates that have been enacted or substantively enacted at the balance sheet date.

Deferred tax is charged or credited in the Statement of Comprehensive Income, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity.

   (g)   Investments Held at Fair Value Through Profit or Loss 

When a purchase or sale is made under contract, the terms of which require delivery within the timeframe of the relevant market, the investments concerned are recognised or derecognised on the trade date and are initially measured at fair value.

On initial recognition the Company has designated all of its investments as held at fair value through profit or loss as defined by IFRS. All investments are measured at subsequent reporting dates at fair value, which is either the bid price or the last traded price, depending on the convention of the exchange on which the investment is quoted.

Written options are valued at fair value using quoted bid prices.

All investments, classified as fair value through profit or loss, are further categorised into the fair value hierarchy detailed below.

Changes in fair value of all investments and derivatives held at fair value and realised gains and losses on disposal are recognised in the capital return column of the Statement of Comprehensive Income.

In respect of unquoted investments, or where the market for a financial instrument is not active, fair value is established by using various valuation techniques, in accordance with the International Private Equity and Venture Capital ("IPEVC") Valuation Guidelines - Edition December 2018. These may include using reference to recent arm's length market transactions between knowledgeable, willing parties, if available, reference to recent rounds of re-financing undertaken by investee companies involving knowledgeable parties, reference to the current fair value of another instrument that is substantially the same or an earnings multiple.

   (h)   Receivables 

Receivables are initially recognised at fair value and subsequently measured at amortised cost. Receivables do not carry any interest and are short-term in nature and are accordingly stated at their nominal value (amortised cost) as reduced by appropriate allowances for estimated irrecoverable amounts.

   (i)    Cash and Cash Equivalents 

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

   (j)    Dividends Payable 

Dividends payable to shareholders are recognised in the financial statements when they are paid, or in the case of final dividends, when they are approved by the shareholders.

   (k)   Payables 

Payables are not interest-bearing and are initially valued at fair value and subsequently stated at their nominal value (amortised cost).

   (l)    Bank Loans 

Interest-bearing bank loans are initially recognised at cost, being the proceeds received net of direct issue costs, and subsequently at amortised cost. The amounts falling due for repayment within one year are included under current liabilities in the balance sheet.

(m) Foreign Currency Translation

Transactions in foreign currencies are translated into Sterling at the rate of exchange ruling on the date of each transaction. Monetary assets, monetary liabilities and equity investments in foreign currencies at the balance sheet date are translated into Sterling at the rates of exchange ruling on that date.

Realised 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 Statement of Comprehensive Income.

Foreign exchange gains and losses arising on investments held at fair value are included within changes in fair value.

   (n)   Share Capital 

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new ordinary shares or options are shown in equity, as a deduction, net of tax, from the proceeds.

   (o)   Capital Reserves 

Capital reserve arising on investments sold includes:

   -      gains/losses on disposal of investments; 
   -      exchange differences on currency balances; and 

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

Capital reserve arising on investments held includes:

   -      increases and decreases in the valuation of investments held at the balance sheet date. 

All of the above are accounted for in the Statement of Comprehensive Income.

   (p)   Repurchase of Ordinary Shares (including those held in treasury) 

Where applicable, the costs of repurchasing ordinary shares including related stamp duty and transaction costs are taken directly to equity and reported through the Statement of Changes in Equity as a charge on the special distributable reserve. Share repurchase transactions are accounted for on a trade date basis.

The nominal value of ordinary share capital repurchased and cancelled is transferred out of called up share capital and into the capital redemption reserve.

Where shares are repurchased and held in treasury, the transfer to capital redemption reserve is made if and when such shares

are subsequently cancelled.

   (q)   Share Issue Costs 

Where applicable, costs incurred directly in relation to the issue of new shares together with additional share listing costs have been deducted from the share premium reserve.

   (r)    New and Revised Accounting Standards 

There were no new IFRSs or amendments to IFRSs applicable to the current year which had any significant impact on the Company's financial statements.

The following standards became effective on 1 January 2019 and the adoption of the standards and interpretations have not had a material impact on the financial statements of the Company.

IFRS 16 Leases

As the Company neither holds, trades or has any lease obligations of any type, the provisions of this standard are not expected to have a material impact on the financial statements.

IFRS 9 (Amended) Prepayment Features with Negative Compensation

Negative compensation arises where the contractual terms permit a borrower to prepay the instrument before its contractual maturity, but the prepayment amount could be less than unpaid amounts of principal and interest. The Company has no such terms in any of its loan agreements in place and the amendment are not expected to have any impact on the financial statements.

IFRIC 23 Uncertainty over Income Tax Treatments

The interpretation provides guidance on considering uncertain tax treatments in relation to taxable profit or loss and does not add any new disclosures. The Company complies with all relevant tax laws where applicable and the provisions of this interpretation are not expected to have a material impact on the financial statements.

IAS 19 (amended) Employee Benefits

As the Company has no employees, the amendment to this standard are not expected to have any impact on the financial statements.

IAS 28 (amended) Investments in Associates and Joint Ventures

As the Company has no investment in associates or joint ventures, the amendment to this standard are not expected to have any impact on the financial statements.

Annual Improvement Cycles 2015 - 2017 (Amendments)

This makes narrow-scope amendments to four IFRS Standards: IFRS 3 Business Combinations, IFRS 11 Joint Arrangements, IAS 12 Incomes Taxes and IAS 23 Borrowing costs. These limited amendments are not expected to have any impact on the financial statements.

At the date of authorisation of the Company's financial statements, the following new IFRSs that potentially impact the Company are in issue but are not yet effective and have not been applied in the financial statements:

Effective for periods commencing on or after 1 January 2020:

IFRS 3 Business Combinations (amended)

The IASB has made narrow-scope amendments to improve the definition of a business in order to help companies determine whether an acquisition made is of a business or a group of assets. These amendments are not expected to have any impact on the financial statements.

IFRS 9, IAS 39 and IFRS 17: Interest Rate Benchmark Reform (amended)

The IASB has issued amendments to IFRS 9, IAS 39 and IFRS 7 that provide certain reliefs in connection with interest rate benchmark reform. The reliefs relate to hedge accounting and have the effect that IBOR reform should not generally cause hedge accounting to terminate. These amendments are not expected to have any impact on the financial statements.

IAS 1 and IAS 8 Definition of Material (amended)

The definition of material has been amended to state that "information is material if omitting, misstating or obscuring it could reasonably be expected to influence decisions that the primary users of general purpose financial statements make on the basis of those financial statements, which provide financial information about a specific reporting entity". This new definition is not expected to change how materiality judgements are currently made by the Company nor have any impact to the material information inclusive in the Annual Report.

References to the Conceptual Framework in IFRS Standards (amended)

The Amendments to References to the Conceptual Framework in IFRS Standards was issued to support transition to the revised Conceptual Framework for companies that develop accounting policies using the Conceptual framework when no IFRS Standard applies to a particular transaction. This amendment is not expected to have any impact to the financial statements.

Effective for periods commencing on or after 1 January 2021:

IFRS 4 Insurance Contracts - temporary exemption from IFRS 9 (amended)

The temporary exemption permits companies whose activities are predominantly connected with insurance to defer the application of IFRS 9.

IFRS 9, IAS 39, IFRS 7, IFRS 16 and IFRS 4: Interest Rate Benchmark Reform - phase 2 (amended)

Interest Rate Benchmark Reform-Phase 2, address issues that might affect financial reporting during the reform of an interest rate benchmark, including the effects of changes to contractual cash flows or hedging relationships arising from the replacement of an interest rate benchmark with an alternative benchmark rate.

Effective for periods commencing on or after 1 January 2023:

IFRS 17 Insurance Contracts

The standard establishes the principles for the recognition, measurement, presentation and disclosure of insurance contracts. This information gives a basis for users of financial statements to assess the effect that contracts have on the financial position, financial performance and cash flows of a company.

The Directors expect that the adoption of the standards listed above will have either no impact or that any impact will not be material on the financial statements of the Company in future periods.

   (s)    Segmental Reporting 

Under IFRS 8 Operating Segments, operating segments are considered to be the components of an entity about which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. The chief operating decision maker has been identified as the Investment Manager (with oversight from the Board).

The Directors are of the opinion that the Company has only one operating segment and as such no distinct segmental reporting is required.

   (t)    Critical Accounting Estimates and Judgements 

The preparation of financial statements in conformity with IFRS requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets, liabilities, income and expenses. Estimates and assumptions used in preparing the 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 judgements about carrying values of assets and liabilities that are not readily apparent from other sources.

The key judgements and sources of estimation uncertainty that have a significant risk of causing material adjustment to the carrying amounts of assets and liabilities and expenses in future periods are as follows:

Valuation of Level 3 Investments

Investments valued using valuation techniques include unlisted financial investments, which by their nature, do not have an externally quoted price based on regular trades.

The valuation techniques used may include the techniques described in note 2(g). When determining the inputs into the valuation techniques used, priority is given to publicly available prices from independent sources when available, but overall the source of pricing is chosen with the objective of arriving at a fair value measurement that reflects the price at which an orderly transaction would take place between market participants at the balance sheet date.

   3     Investment Income 
                                Year ended    Year ended 
                               30 November   30 November 
                                      2020          2019 
                                   GBP'000       GBP'000 
----------------------------  ------------  ------------ 
UK dividends                           717         1,763 
Overseas dividends                   4,775         9,028 
Scrip dividends                         92           125 
Interest on debt securities            713         1,105 
Total investment income              6,297        12,021 
----------------------------  ------------  ------------ 
   4     Other Operating Income 
                                 Year ended    Year ended 
                                30 November   30 November 
                                       2020          2019 
                                    GBP'000       GBP'000 
-----------------------------  ------------  ------------ 
Bank interest                             7            35 
Interest on tax receivable                -             1 
-----------------------------  ------------  ------------ 
Total other operating income              7            36 
-----------------------------  ------------  ------------ 
   5     (Losses)/Gains on Investments Held at Fair Value 
                                                  Year ended    Year ended 
                                                 30 November   30 November 
                                                        2020          2019 
                                                     GBP'000       GBP'000 
----------------------------------------------  ------------  ------------ 
Net (losses)/gains on disposal of investments 
 at historic cost                                    (9,309)           767 
Less fair value adjustments in earlier 
 years                                              (43,289)       (3,870) 
----------------------------------------------  ------------  ------------ 
Losses based on carrying value at previous 
 balance sheet date                                 (52,598)       (3,103) 
Valuation gains on investments held during 
 the year                                              4,690        24,028 
----------------------------------------------  ------------  ------------ 
                                                    (47,908)        20,925 
----------------------------------------------  ------------  ------------ 
   6     Other Currency Losses 
                                         Year ended    Year ended 
                                        30 November   30 November 
                                               2020          2019 
                                            GBP'000       GBP'000 
-------------------------------------  ------------  ------------ 
Exchange losses on currency balances          (588)          (76) 
-------------------------------------  ------------  ------------ 
Exchange gains on the loan facility              82             - 
-------------------------------------  ------------  ------------ 
                                              (506)          (76) 
-------------------------------------  ------------  ------------ 
   7     Investment Management and Performance Fee 
                                                       Year ended    Year ended 
                                                      30 November   30 November 
                                                             2020          2019 
                                                          GBP'000       GBP'000 
---------------------------------------------------  ------------  ------------ 
Management fee 
- charged to revenue                                          299           461 
- charged to capital                                        1,195         1,846 
---------------------------------------------------  ------------  ------------ 
Investment management fee payable to 
 Polar Capital LLP                                          1,494         2,307 
---------------------------------------------------  ------------  ------------ 
 Performance fee payable to Polar Capital (charged 
   wholly to capital)                                       1,269             - 
---------------------------------------------------  ------------  ------------ 
 As part of the reconstruction process, the management fee was reduced to 0.70% of NAV (previously 0.85% of the lower 
 of market capitalisation and NAV) with effect from 7 April 2020. The performance fee was renewed and rebased 
 the tender offer and is calculated as 10% of the excess return over the performance fee hurdle; the first performance 
 opened on 23 April 2020 and will close on the tender offer to be made to shareholders on or before 30 June 2025. 
 of the investment management and performance fees are set out in the Strategic Report above. Management fees are 
 allocated 20% to revenue and 80% to capital. 
   8     Other Administrative Expenses (including VAT where appropriate) 
                                                  Year ended    Year ended 
                                                 30 November   30 November 
                                                        2020          2019 
                                                     GBP'000       GBP'000 
---------------------------------------------   ------------  ------------ 
Directors' fees(1)                                       122           106 
Directors' NIC                                             9             6 
Auditors' remuneration - for audit of 
 the financial statements(2)                              36            33 
Depositary fee(3)                                         22            25 
Registrar fee                                             26            26 
Custody and other bank charges(3)                         40            42 
UKLA and LSE listing fees                                 27            27 
Legal and professional fees                                3            22 
AIC fees                                                  20            21 
Directors' and officers' liability insurance               9             8 
Corporate broker's fee                                    47            54 
Marketing expenses(4)                                     80            87 
Research costs - allocated 
 to revenue(5)                                             3             4 
Shareholder communications                                23            26 
HSBC administration fee                                  140           133 
Other expenses(6)                                         22            26 
----------------------------------------------  ------------  ------------ 
Total other administrative 
 allocated to revenue                                    629           646 
----------------------------------------------  ------------  ------------ 
Research costs - allocated 
 to capital(5)                                            11            15 
----------------------------------------------  ------------  ------------ 
Total other administrative 
 expenses                                                640           661 
----------------------------------------------  ------------  ------------ 
   1    Full disclosure is given in the Directors' Remuneration Report in the Annual Report. 

2 In April 2020, the Company engaged PwC to perform agreed upon procedures on the tender price for the reconstruction, such service was deemed to be a non-audit service for which a fee of GBP10,000 was paid.

The amount has been charged to special distributable reserve as defined under IAS 32.

   3    Fees determined on the pre-approved rate card with HSBC. 

4 Includes bespoke marketing expenses payable to Polar Capital LLP of GBP27,000 (2019: GBP60,000) and GBP28,000 relating to the reconstruction of the Company.

5 Research costs (which applied from 3 January 2018) payable by the Company relate solely to specialist financial research. The estimated spend for the year under review was US $20,000

(GBP14,000) (2019: US $24,476 (GBP19,000)), the cost of general non-specialist research and any amounts exceeding the agreed cap are absorbed by Polar Capital. Any adjustments to the

prior year's budget versus actual spend is included in the current period. These costs are allocated 20% to revenue and 80% to capital and are included in the ongoing charges calculation.

   6    2020 includes costs in relation to dividend collection 

Ongoing charges represents the total expenses of the Company, excluding finance costs and tax, expressed as a percentage of the average daily net asset value, in accordance with AIC guidance issued in May 2012.

The ongoing charges ratio for the year ended 30 November 2020 was 1.09% (2019: 1.04%). The ongoing charges ratio including the performance fee accrued was 1.74% (2019: 1.04%). See Alternative Performance Measures provided in the Annual Report.

   9     Finance Costs 
                           Year ended 30 November        Year ended 30 November 
                                    2020                          2019 
----------------------  ----------------------------  ---------------------------- 
                         Revenue   Capital     Total   Revenue   Capital     Total 
                         GBP'000   GBP'000   GBP'000   GBP'000   GBP'000   GBP'000 
----------------------  --------  --------  --------  --------  --------  -------- 
Interest on loans and 
 overdrafts                   54       215       269        49       197       246 
Loan arrangement fees          7        26        33        11        45        56 
----------------------  --------  --------  --------  --------  --------  -------- 
                              61       241       302        60       242       302 
----------------------  --------  --------  --------  --------  --------  -------- 

Finance costs are allocated 20% to revenue and 80% to capital.

   10   Taxation 

a) Analysis of tax charge/(credit) for the year:

                                  Year ended 30 November        Year ended 30 November 
                                           2020                          2019 
-----------------------------  ----------------------------  ---------------------------- 
                                Revenue   Capital     Total   Revenue   Capital     Total 
                                 return    return    return    return    return    return 
                                GBP'000   GBP'000   GBP'000   GBP'000   GBP'000   GBP'000 
-----------------------------  --------  --------  --------  --------  --------  -------- 
Overseas tax                        520         -       520       841         -       841 
Tax relief in capital               147     (147)         -       237     (237)         - 
Withholding tax recovered           (6)         -       (6)     (111)         -     (111) 
Total tax charge/(credit) 
 for the year (see note 10b)        661     (147)       514       967     (237)       730 
-----------------------------  --------  --------  --------  --------  --------  -------- 

b) Factors affecting tax charge/(credit) for the year:

The charge/(credit) for the year can be reconciled to the loss per 
 the Statement of Comprehensive Income as follows: 
                                   Year ended 30 November        Year ended 30 November 
                                            2020                          2019 
                                ----------------------------  ---------------------------- 
                                 Revenue   Capital     Total   Revenue   Capital     Total 
                                 r eturn    return    return    return    return    return 
                                 GBP'000   GBP'000   GBP'000   GBP'000   GBP'000   GBP'000 
------------------------------  --------  --------  --------  --------  --------  -------- 
(Loss)/profit before tax           5,315  (51,130)  (45,815)    10,890    18,746    29,636 
------------------------------  --------  --------  --------  --------  --------  -------- 
Tax at the UK corporation 
 tax rate of 19% (2019: 19%)       1,010   (9,715)   (8,705)     2,069     3,562     5,631 
Tax effect of non-taxable 
 dividends                         (839)         -     (839)   (1,727)         -   (1,727) 
Losses/(gains) on investments 
 that are not taxable                  -     9,199     9,199         -   (3,961)   (3,961) 
Overseas tax suffered                520         -       520       841         -       841 
Unrelieved current period 
 expenses and deficits                 -       349       349         -        77        77 
Withholding tax recovered            (6)         -       (6)     (111)         -     (111) 
Tax relief on overseas tax 
 suffered                           (24)        20       (4)     (105)        85      (20) 
------------------------------  --------  --------  --------  --------  --------  -------- 
Total tax charge/(credit)for 
 the year (see note 10a)             661     (147)       514       967     (237)       730 
------------------------------  --------  --------  --------  --------  --------  -------- 

c) Factors that may affect future tax charges:

The Company has an unrecognised deferred tax asset of GBP605,000 (2019: GBP222,000) based on a prospective corporation tax rate of 19% (2019: 17%). At the 2020 budget, the government announced that the main rate of corporation tax would remain at 19% for fiscal years beginning on 1 April 2020 and 2021.

The deferred tax asset has arisen due to the cumulative excess of deductible expenses over taxable income. Given the composition of the Company's portfolio, it is not likely that this asset will be utilised in the foreseeable future and therefore no asset has been recognised in the financial statements.

Given the Company's intention to continue to meet the conditions required to retain its status as an Investment Trust Company, no provision has been made for deferred tax on any capital gains or losses arising on the revaluation or disposal of investments.

   11   (Losses)/Earnings Per Ordinary Share 
                                  Year ended 30 November 2020            Year ended 30 November 2019 
---------------------------  -------------------------------------  ------------------------------------- 
                                 Revenue      Capital        Total      Revenue      Capital        Total 
                                  return       return       return       return       return       return 
---------------------------  -----------  -----------  -----------  -----------  -----------  ----------- 
The calculation of 
 basic (losses)/earnings 
 per share is based 
 on the following 
---------------------------  -----------  -----------  -----------  -----------  -----------  ----------- 
Net (loss)/profit 
 for the year (GBP'000)            4,654     (50,983)     (46,329)        9,923       18,983       28,906 
---------------------------  -----------  -----------  -----------  -----------  -----------  ----------- 
Weighted average 
 number of ordinary 
 shares in issue during 
 the year                    154,433,083  154,433,083  154,433,083  202,775,000  202,775,000  202,775,000 
From continuing operations 
Basic - ordinary 
 shares (pence)                     3.01      (33.01)      (30.00)         4.89         9.36        14.25 
---------------------------  -----------  -----------  -----------  -----------  -----------  ----------- 

As at 30 November 2020 there were no potentially dilutive shares in issue (2019: nil).

   12   Amounts Recognised as Distributions to Ordinary Shareholders in the Year 

Dividends paid in the year ended 30 November 2020

                                                Year ended 
                                               30 November 
                                  Amount per          2020 
Payment date       No. of shares       share       GBP'000 
-----------------  -------------  ----------  ------------ 
28 February 2020     202,775,000       2.00p         4,055 
28 August 2020       123,145,765       2.40p         2,955 
-----------------  -------------  ----------  ------------ 
-----------------  -------------  ----------  ------------ 

The revenue available for distribution by way of dividend for the year is GBP4,654,000 (2019: GBP9,923,000).

The total dividends payable in respect of the financial year ended 30 November 2020, which is the basis on which the requirements of Section 1158 of the Corporation Tax Act 2010 are considered, are set out below:

                                               Year ended 30 
                                  Amount per   November 2020 
Payment date       No. of shares       share         GBP'000 
-----------------  -------------  ----------  -------------- 
28 August 2020       123,145,765       2.40p           2,955 
26 February 2021     134,675,000       2.00p           2,694 
-----------------  -------------  ----------  -------------- 
-----------------  -------------  ----------  -------------- 

The total dividends payable in respect of the financial year ended 30 November 2019, which is the basis on which the requirements of Section 1158 of the Corporation Tax Act 2010 are considered, are set out below:

                                                     Year ended 
                                  Amount per   30 November 2019 
Payment date       No. of shares       share            GBP'000 
-----------------  -------------  ----------  ----------------- 
30 August 2019       202,775,000       2.40p              4,867 
28 February 2020     202,775,000       2.00p              4,055 
-----------------  -------------  ----------  ----------------- 
-----------------  -------------  ----------  ----------------- 

All dividends are paid as interim dividends, and all have been charged to revenue, where necessary utilising the revenue reserves.

   13   Investments Held at Fair Value Through Profit or Loss 

a) Investments held at fair value through profit or loss

                                              30 November    30 November 
                                             2020 GBP'000   2019 GBP'000 
------------------------------------------  -------------  ------------- 
Opening book cost                                 239,434        232,411 
Opening investment holding gains                   74,171         54,013 
------------------------------------------  -------------  ------------- 
Opening fair value                                313,605        286,424 
Analysis of transactions made during 
 the year 
Purchases at cost                                 110,093         78,759 
Sales proceeds received                         (187,901)       (72,613) 
(Losses)/gains on investments held at 
 fair value                                      (47,908)         20,925 
Amortisation on fixed interest securities             122            110 
Closing fair value                                188,011        313,605 
------------------------------------------  -------------  ------------- 
Closing book cost                                 152,439        239,434 
Closing investment holding gains                   35,572         74,171 
Closing fair value                                188,011        313,605 
------------------------------------------  -------------  ------------- 

The Company received GBP187,901,000 (2019: GBP72,613,000) from disposal of investments in the year. The book cost of these investments when they were purchased was GBP197,210,000 (2019: GBP71,846,000). These investments have been revalued over time and until they were sold any unrealised gains/losses were included in the fair value of the investments.

The following transaction costs, including stamp duty and broker commissions, were incurred during the year:

                    30 November    30 November 
                   2020 GBP'000   2019 GBP'000 
----------------  -------------  ------------- 
On acquisitions             151            102 
On disposals                147             47 
----------------  -------------  ------------- 
                            298            149 
----------------  -------------  ------------- 

b) Fair value hierarchy

The Company's financial instruments within the scope of IFRS 7 that are held at fair value comprise its investment portfolio and derivative financial instruments.

They are categorised into a hierarchy consisting of the following three levels:

Level 1 - valued using quoted prices in active markets for identical assets or liabilities.

Level 2 - valued by reference to valuation techniques using observable inputs other than quoted market prices included within Level 1.

Level 3 - valued by reference to valuation techniques using inputs that are not based on observable market data.

Categorisation within the hierarchy has been determined on the basis of the lowest level input that is significant to 'the fair value measurement of the relevant asset'.

Details of the valuation techniques used by the Company are given in note 2(g) above.

The following tables set out the fair value measurements using the IFRS 7 hierarchy at 30 November 2020 and 2019:

                                      As at 30 November 2020 
----------------------------  -------------------------------------- 
                               Level 1   Level 2   Level 3     Total 
                               GBP'000   GBP'000   GBP'000   GBP'000 
----------------------------  --------  --------  --------  -------- 
Equity Investments             174,955         -     2,120   177,075 
Interest bearing securities     10,936         -         -    10,936 
Total                          185,891         -     2,120   188,011 
----------------------------  --------  --------  --------  -------- 
The Level 3 investment relates to the shares in Atom Bank. 
                                      As at 30 November 2019 
----------------------------  -------------------------------------- 
                               Level 1   Level 2   Level 3     Total 
                               GBP'000   GBP'000   GBP'000   GBP'000 
----------------------------  --------  --------  --------  -------- 
Equity Investments             288,954         -     3,191   292,145 
Interest bearing securities     21,460         -         -    21,460 
Total                          310,414         -     3,191   313,605 
----------------------------  --------  --------  --------  -------- 

The Level 3 investment relates to the shares in Atom Bank.

There have been no transfers during the year between Levels 1 and 2. A reconciliation of fair value measurements in Level 3 is set out below.

Level 3 investments at fair value through     30 November    30 November 
 profit or loss                              2020 GBP'000   2019 GBP'000 
------------------------------------------  -------------  ------------- 
Opening balance                                     3,191          3,191 
Total loss included in the statement 
 of Comprehensive 
 -on assets held at the year end                  (1,071)              - 
Closing balance                                     2,120          3,191 
------------------------------------------  -------------  ------------- 

Level 3 Investments are recognised at fair value through profit or loss on a recurring basis.

Level 3 investments are valued in accordance with the accounting policy in Note 2(g)above. The valuation of the investment in Atom Bank was arrived at taking into account the operating performance of the bank and the market movements in share prices of UK bank peers. As a result, the valuation was discounted by 34%.

A +/- 10% change in the market value of UK bank peers used to value the investment in Atom Bank as at the year end would result in a +/- GBP212,000 (2019: GBP319,000) impact on the gains or losses on investments held at fair value in the Statement of Comprehensive Income.

   c)     Unquoted investments 

The value of the unquoted investments as at 30 November 2020 was GBP2,120,000 (2018: GBP3,191,000) and the portfolio comprised the following holdings:

            30 November  30 November 
                   2020         2019 
                GBP'000      GBP'000 
----------  -----------  ----------- 
Atom Bank         2,120        3,191 
----------  -----------  ----------- 
                  2,120        3,191 
----------  -----------  ----------- 

At 30 November 2020, the Company owned 0.64% (2019: 0.64%) of Atom Bank's issued share capital. Atom Bank was granted a full banking licence on 4 April 2016 and started to accept savings and loan business from this date.

At 31 March 2020 (Atom Bank's financial year end), Atom Bank announced that it had made pre-tax losses of GBP63,945,000

(2019: GBP79,857,000) and had net assets attributable to shareholders of GBP200,503,000 (2019: GBP212,704,000).

The valuation of Atom Bank was reviewed by the Investment Manager and the Board during both the half year and full year

financial results process. On a longer-term basis the Investment Manager believes the business can generate attractive returns

by leveraging an efficient cost base, capital efficiency (IRB approval) and diversifying the loan book into higher margin products.

The Investment Manager has also been encouraged by the progress made recently with an improved UK mortgage pricing

environment leading to a wider net interest margin, growth of its SME business (benefiting from its approval as a CBILS lender)

and the transition of its core banking system onto Google's Cloud Platform.

   14   Cash and Cash Equivalents 
                                          30 November  30 November 
                                                 2020         2019 
                                              GBP'000      GBP'000 
----------------------------------------  -----------  ----------- 
Cash at bank                                      140        1,780 
Cash held at derivative clearing houses             -        2,395 
----------------------------------------  -----------  ----------- 
Cash and Cash Equivalents                         140        4,175 
----------------------------------------  -----------  ----------- 
Bank overdraft                                  (383)      (4,875) 
----------------------------------------  -----------  ----------- 
                                                (243)        (700) 
----------------------------------------  -----------  ----------- 
   15   Called Up Share Capital 
                                                               30 November    30 November 
                                                              2020 GBP'000   2019 GBP'000 
-----------------------------------------------------------  -------------  ------------- 
Allotted, Called up and Fully paid: 
Ordinary shares of 5p each: 
Opening balance of 202,775,000 (30 November 
 2019: 202,775,000)                                                 10,139         10,139 
-----------------------------------------------------------  -------------  ------------- 
 Issue of 104,335 (2019: nil) ordinary shares 
   out of treasury                                                       5              - 
-----------------------------------------------------------  -------------  ------------- 
 Repurchase of 79,159,235 (2019: nil) ordinary shares into 
   pursuant to tender offer                                        (3,958)              - 
-----------------------------------------------------------  -------------  ------------- 
 Repurchase of 670,000 (2019: nil) ordinary 
   shares into treasury                                               (33)              - 
-----------------------------------------------------------  -------------  ------------- 
Allotted, Called up and Fully paid: 123,050,100 
 (30 November 2019: 202,775,000) ordinary 
 shares of 5p                                                        6,153         10,139 
79,724,900 (2019: nil) ordinary shares 
 held in treasury                                                    3,986              - 
At 30 November 2020                                                 10,139         10,139 
-----------------------------------------------------------  -------------  ------------- 

This reserve is not distributable.

A total of 79,829,235 ordinary shares were repurchased into treasury for a total consideration of GBP81,423,000 (2019: GBPnil) plus expenses of GBP807,000, of which GBP10,000 relates to non-audit services, as defined under IAS 32. On 30 November 2020, 104,335 ordinary shares were issued out of treasury at a cost of GBP142,000 (2019: GBPnil).

Subsequent to the year end 14,074,900 ordinary shares were issued out of treasury at an average price of 147.0p per share.

The ordinary shares held in treasury have no voting rights and are not entitled to dividends.

   16   Net Asset Value Per Ordinary Share 
                                                   30 November  30 November 
                                                          2020         2019 
-------------------------------------------------  -----------  ----------- 
Net assets attributable to ordinary shareholders 
 (GBP'000)                                             165,743      301,170 
Ordinary shares in issue at end of year            123,050,100  202,775,000 
-------------------------------------------------  -----------  ----------- 
Net asset value per ordinary share (pence)              134.70       148.52 
-------------------------------------------------  -----------  ----------- 

As at 30 November 2020, there were no potentially dilutive shares in issue (2019: nil).

   17   Transactions with the Investment Manager and Related Party Transactions 

a) Transactions with the manager

Under the terms of an agreement dated 11 June 2013 the Company appointed Polar Capital LLP ("Polar Capital") to provide investment management, accounting, secretarial and administrative services. Details of the fee arrangement for these services are given in the Strategic Report. The total fees paid under this agreement to Polar Capital in respect of the year ended 30 November 2020 were GBP1,494,000 (2019: GBP2,307,000) of which GBP179,000 (2019: GBP201,000) was outstanding at the year end.

A performance fee of GBP1,269,000 (2019: GBPnil) accrued in respect of the year, and the whole of this amount was outstanding at the year end. Any accrued performance fee is payable at the end of each five-year tender period, the next being in 2025. See Strategic Report above for more details.

In addition, the total research costs in respect of the period from 1 January 2020 to the year ended 30 November 2020 were GBP14,000 (2019: GBP19,000) of which GBP7,000 (2019: GBP9,000) was outstanding at the year-end.

b) Related party transactions

The Company has no employees and therefore no key management personnel other than the Directors. The Company paid GBP122,000 (2019: GBP106,000) to the Directors of which GBP79,000 (2019: GBP34,000) are outstanding at the year end and the Remuneration Report is provided in the Annual Report. When dividends are paid by the Company these are received by the Directors at the same rates and terms as by all other shareholders.

   18.          Post Balance Sheet Events 

After the year end, a further 14,074,900 ordinary shares were issued out of treasury. Following these share issues, the total number of ordinary shares in issue was 137,125,000 and 65,650,000 shares were held in treasury as at 22 February 2021.

Since the year end, the Company has increased the size of the revolving credit facility with ING Luxembourg SA by an additional GBP10m taking the aggregate funds available under the 2020 revolving credit facility to GBP22.5m, expiring on 12 July 2021. The Company has drawn down a further USD$6.7m (GBP5m) from the revolving credit facility since the year end, see Note 17 in the Annual Report for further details.

There are no other significant events that have occurred after the end of the reporting period to the date of this report which

require disclosure.


The Annual Report and separate Notice of Annual General Meeting will be posted to Shareholders in March 2021 and is available from the Company Secretary at the Company's Registered Office, (16 Palace Street London SW1E 5JD) or from the Company's website. The AGM will be held at the Company's Registered Office at 11am on 30 March 2021. Due to the social distancing measures and restrictions currently in place prohibiting public gatherings as a result of COVID-19, the AGM will be held as a closed-door meeting with only the necessary quorum present to conduct the formal business.

Forward Looking Statements

Certain statements included in the Annual Report and Financial Statements contain forward-looking information concerning the Company's strategy, operations, financial performance or condition, outlook, growth opportunities or circumstances in the countries, sectors or markets in which the Company operates. By their nature, forward-looking statements involve uncertainty because they depend on future circumstances, and relate to events, not all of which are within the Company's control or can be predicted by the Company. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. Actual results could differ materially from those set out in the forward-looking statements. For a detailed analysis of the factors that may affect our business, financial performance or results of operations, we urge you to look at the principal risks and uncertainties included in the Strategic Report Section of the Annual Report and Financial Statements.

No part of these results constitutes, or shall be taken to constitute, an invitation or inducement to invest in Polar Capital Global Financials Trust plc or any other entity and must not be relied upon in any way in connection with any investment decision. The Company undertakes no obligation to update any forward-looking statements. 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.

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