Provident confident of higher profit

Bradford-based Provident Financial, which specialises in loans to people who borrow under 500 and pay it back in weekly instalments, said it has managed to remain profitable, thanks partly to tight cost control.

The company said that trading for the nine months to the end of September was in line with its forecasts and there has been a recent pick-up at its home credit business.

It added it expected the Government's plans to slash spending and cut jobs - part of a move to cut a record budget deficit - to have a "modest" impact on its customers.

"I am encouraged by recent business performance as we enter the peak trading period," said Provident's chief executive Peter Crook.

"We expect the direct impact of the Government's spending review on the group's customer base to be modest but continued tight underwriting and close attention to margins and costs will remain in place over the coming months until there is evidence of a sustained economic recovery," he added.

Many of Britain's subprime lenders have been impacted by the aftermath of the credit crisis.

Batley-based Cattles, which is in the process of restructuring talks, said on Friday that its creditors should brace themselves for heavy losses.