Credit, Collections & Insolvency News
Provident Financial has confirmed it is looking to raise around £300m to shore up its finances and meet the costs of FCA investigations into its credit card and car finance arms.
As part of its latest company results Provident said its Moneybarn division continues to cooperate with the FCA in its ongoing investigation into affordability, forbearance and termination options with an estimated liability of £20m.
Responding to the results Malcolm Le May, Chief Executive Officer, said “When I became group CEO, I stated my key objective was to execute a turnaround of the group. Today we have made progress on that objective by agreeing a resolution with the FCA in relation to Vanquis Bank and we now have a clear view on the estimated cost of the FCA investigation of Moneybarn. To grow the business and deliver long-term sustainable returns to our shareholders, PFG needs to strengthen its balance sheet. Today we have announced a proposed rights issue to raise net proceeds of £300m which the Board believes will allow the group to implement its strategy and restart paying a progressive dividend in 2019.”
“The group’s businesses of Vanquis Bank, Provident home credit, Satsuma, and Moneybarn are all well positioned in their markets, with products that customers’ value and which operate well throughout the economic cycle. The recovery in Provident home credit is on track with collections performance continuing to improve. In 2018, the group will continue to rebuild trust with our customers, regulators, shareholders and employees. The group’s turnaround is making progress, but the Board and I realise there is still much to do to achieve a customer-centric business delivering long-term sustainable returns to our shareholders.”