Provident Financial warns of £120m loss; shares fall

Shares of troubled Bradford-based subprime lender Provident Financial fell 13% on Tuesday after it said its consumer credit division (CCD) is expected to report a pre-exceptional loss of £120 million which is at the upper end of the guidance provided in August 2017.

“This reflects a lower than expected rate of reconnection through the fourth quarter with those home credit customers whose relationship had been adversely impacted following the poorly executed migration to the new operating model in July 2017,” said Provident Financial.

In an update on trading for the financial year ended December 31, 2017, Provident Financial said its Vanquis Bank and Moneybarn units have both commenced dialogue with the Financial Conduct Authority (FCA) with a view to reaching a resolution to their respective investigations.

Malcolm Le May, Provident Financial Interim Executive Chairman, said: “I am pleased to report that good progress has been made towards restoring customer service in the home credit business and that we are engaged in a dialogue with the FCA with a view to reaching a resolution of the regulatory investigations at Vanquis Bank and Moneybarn.

“In addition, we continue to make progress in the search for a new group chief executive.

“All of our businesses have strong positions in their respective markets.

“Our priorities for 2018 are to rebuild trust with our customers, regulators, shareholders and employees.”