Provident Financial '˜in dialogue' with FCA in bid to resolve regulatory investigations

PROVIDENT Financial today said it is 'engaged in a dialogue' with the Financial Conduct Authority with a view to reaching a resolution of the regulatory investigations at Vanquis Bank and Moneybarn.

Provident Financial is 'engaged in a dialogue' with the FCA

The company has published an update on trading for the financial year ended December 31 2017, ahead of its final results for the year which will be announced on February 27 2018.

The statement said: “Vanquis Bank and Moneybarn have both traded satisfactorily through the final quarter of the year.

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“The Consumer Credit Division (CCD) is expected to report a pre-exceptional loss of approximately £120m, 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.”

Home credit management has delivered “substantial improvements” in customer service and operational performance since August and the business enters 2018 with some 530,000 active customers, up from approximately 500,000 at September 2017, the statement said.

Malcolm Le May, 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. I would like to thank all our employees for their continuing hard work and dedication throughout a difficult period for the group.”

At Vanquis Bank, the total new customer bookings for 2017 were 437,000, up from 406,000 in 2016.

The company said that this reflected the benefit from the actions put in place in the second half of last year to develop the credit card proposition and enhance distribution, including the launch of the Chrome near prime credit card. Customer numbers ended the year at 1,710,000, representing year-on-year growth of 11 per cent.