Shares of troubled Bradford-based subprime lender Provident Financial rose 7% on Friday after it announced the appointment of Malcolm Le May as CEO with immediate effect.
The appointment fills the CEO role that has been open for five months since the company was plunged into crisis last August.
In August, Provident Financial shares plummeted more than 70% after it issued a second profit warning in roughly two months and said then CEO Peter Crook would leave the company and its dividend would be suspended.
Provident Financial had suffered major problems with its move from using self-employed agents to directly employed debt collection agents called CEMs or “customer experience managers.”
Then, Manjit Wolstenholme, who had stepped into the role of executive chairman, died suddenly in November at the age of 53.
Le May was appointed was appointed as interim executive chairman in November following Wolstenholme’s death.
Provident shares have fallen from over £30 in May 2017 to around £7.
On Friday, Provident Financial shares rose about 7% to £7.15 on news of the new CEO and a number of other senior appointments.
Le May was previously co-head of banking for Barclays in New York, helping to rebuild its US franchise. He was also head of investment banking, Europe at UBS.
Le May said: “My key objective is to execute a turn around of the group.
“We will re-establish a stronger customer focused business; conclude with our regulators the issues surrounding Vanquis Bank and Moneybarn; continue the progress being made in our Home Credit business and restore it as the pre-eminent business in its market; and ensure our businesses collaborate for the benefit of our customers and our shareholders.”
In a long stock exchange statement, Provident Financial said: “The board believes that Malcolm Le May is an outstanding candidate for the role, given his existing knowledge of the group, his deep knowledge of the business and sector, his regulatory understanding and turn-around and leadership skills.
“In making this decision the board has consulted with certain of its leading shareholders and discussed his appointment with the FCA.
“The board also notes that since the trading statement on the 16th January 2018, Home Credit continues to make good operational progress, and discussions continue with the FCA in relation to the Vanquis Bank and Moneybarn investigations.
“The company also announces a number of senior appointments to drive the execution of the group’s strategy under Malcolm Le May to serve customers better, enhance our relationship with the regulators, and to restore sustainable attractive returns for our shareholders.”
Provident made the following statement on the other senior appointments:
- Chris Sweeney, MD Vanquis Bank “will continue to focus on leadership of Vanquis Bank and the successful resolution of ROP; once this has been achieved the board intends to appoint him as deputy group chief executive officer in addition to his Vanquis Bank role.”
- The permanent appointment of Chris Gillespie, MD Consumer Credit Division, “who will continue to focus on its continued successful turn around.”
- The appointment of Steve Grigg, as interim group chief information & technology officer “to define the group’s long-term IT architecture.”
- The board has instigated a process to appoint a new external chairman as well as two additional non-executive directors as soon as practicable.
- The appointment of Stuart Sinclair as interim chairman, moving to this role from that of senior independent director.
- The appointment of Andrea Blance, as the new senior independent director.