IPF closes Russian banking operation
CREDIT lender International Personal Finance today announced that it is to shut down its banking operation in Russia.
The group, the former international division of Bradford-based Provident Financial which provides smaller credit facilities in Eastern Europe and Mexico, said that the pilot operation, which had seen it acquire a Russian bank licence at the end of 2007, had been hit by the downturn in the economy and would mean that its roll-out plans and “path to profit” would be slower than originally planned.
At the end of March Leeds-based IPF’s Russian operation had 875 customers, £200,000 of net customer receivables and 71 employees.
Trading losses in 2009 are expected to be £3m while pre-tax closure costs of £7.8m are expected, comprising winding-up costs of £3.7m and the write-off of goodwill, customer receivables and fixed assets of £4.1m. There will also be a one-off tax charge of £2m relating to the write-off of a deferred tax asset.
The group said today: “Our new market research programme continues as planned and, when the world economy returns to more settled conditions, we will seek to take advantage of opportunities to enter new markets in line with our strategy of geographic expansion. In the meantime our focus will be on realising the significant development opportunities in our established Central European businesses and our developing markets in Mexico and Romania.”
IPF operates in Poland, the Czech Republic, Hungary, Slovakia, Romania and Mexico.
