Provident Financial shares fall on profit warning

Shares of embattled Bradford-based subprime lender Provident Financial fell 20% on Tuesday after it said it expects to report profits for 2018 “towards the lower end of the range of market expectations of £151m to £166m.”

The forecast was included in a trading update for the financial year ended December 31, 2018, ahead of Provident Financial’s full-year results on February 27, 2019.

Provident Financial has been trying to rebuild after a botched revamp of its home credit business led to profit warnings, the departure of its CEO and the suspension of its dividend in 2017.

It has also been under investigation by the UK’s financial watchdog.

Provident Financial CEO Malcolm Le May said: “We have been progressively tightening our underwriting standards throughout the group in anticipation of the current uncertain UK economic environment we are facing.

“We will continue to monitor underwriting standards in light of any changes in customer behaviour.

“The group has strong funding and capital positions and the actions we have taken over the last 18 months have established a solid foundation for continuing to deliver on our strategic aim of being the leading provider of credit products to the 10 to 12 million consumers who are not well served by mainstream lenders.”