Provident to wind-down Polish business as UK demand boosts profits 20pc

Provident Financial is to wind down its credit card operations in Poland, despite the success of its UK product driving a 20 per cent rise in profits.

The Bradford-based company, which operates Vanquis Bank, home credit provider Provident Personal Loans, car finance business Moneybarn and short-term lender Satsuma, said profit before tax was up 19.5 per cent to £234.4m in 2014. Earnings per share rose 18.4 per cent to 132.6p, with its full-year dividend rising 15.3 per cent to 98p.

Profits for Vanquis Bank, aimed at those refused credit elsewhere, were up 32.8 per cent to £151m in the UK.

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Despite this, Provident saw losses of £10.6m in an ongoing trial in Poland, up from £7.6m in 2013.

Provident chief executive Peter Crook said the withdrawal from Provident’s only market outside of the UK and Ireland is down to the firm being “sensible” with its capital due to the extended timeframe before seeing returns.

Online platform Satsuma and Moneybarn, which was acquired in August 2014, provide a better prospect for growth, he added.

Satsuma, which launched in November 2013, is poised to benefit from the “dislocation” of payday lending through regulation and is expected to break even in the coming year as marketing ramps up, Mr Crook said.

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He dismissed the impact of proposals from the Competition and Markets Authority that would require short-term lenders to publish prices on comparison sites, as customers are less more interested in “access and speed”.

“I’m not sure it’s a help or a hindrance,” he said. “If it’s something the regulator wants to do then of course we’ll do it, but from our perspective our agenda for Satsuma is promoting the brand,”