Provident Financial confirms £80m-to-£120m losses as search for CEO gets underway
Crisis-hit lender Provident Financial has confirmed it is facing a pre-exceptional loss for its consumer credit division of between £80m and £120m for 2017, as the hunt for a new chief executive gets underway.
Provident was hit by a profit warning in August, leading to the exit of its chief executive Peter Crook, after the company was forced to announce that its transformation programme, which was expected to boost profits to around £150m, was forecast to generate losses of up to £120m.
Crook left the company with immediate effect after 10 years in charge following the profit warning that caused the company’s share price to crash, wiping off £1.7bn in a single day.
Manjit Wolstenholme, who assumed the role of executive chairman, then began her review of the business, replacing the boss of its home credit business.
In a trading statement this morning, Provident said a home credit business recovery plan has been developed under new leadership to re-establish relationships with customers, stabilise the operation of the business and improve collections performance.
It said Vanquis Bank has delivered “further good growth” through the third quarter of the year against credit standards that have recently been tightened, recognising the uncertainties faced by the UK economy.
The board, which confirmed that a dividend will not be paid, said cash resources and funding capacity amounted to £236m following repayment of the 2012 retail bonds on the maturity date of October 4 2017.
Wolstenholme said: “Since the last update, we have moved quickly to appoint new leadership in home credit who have a deep understanding of the business and recognise the importance of the relationship between our front-line staff and our customers. A recovery plan has been developed and a number of actions have already been implemented to restructure the field organisation in order to provide the foundation for delivering the necessary improvement in customer service and financial performance.
“The board has appointed an independent agency to conduct a search for a new chief executive.”
