Polish pilot creates opportunity for Provident

PROVIDENT Financial today said it has performed in line with its internal plan as it expects to complete a firm strategy for its Polish pilot operation in the first quarter of 2014.

The Bradford-based home credit business said the pilot credit card operation in Poland continues to support the potential for developing a business capable of delivering the group’s target returns and is an “exciting” opportunity to augment the group’s medium-term growth prospects.

In an interim management statement covering the period from July 1 2013 to October 17 2013, Provident said its Vanquis Bank operation, which lends to people turned down for credit by other banks, has continued to outperform its internal plan through the third quarter of the year and has delivered strong growth and robust margins, supported by stable, record low delinquency levels.

However, Provident said its Consumer Credit Division (CCD) has seen no change to the weak pattern of demand reported in the first half of the year.

As reported in July, Provident saw first half pre-tax profits before exceptional restructuring cost up 7% to £76.5m in the six months to June 30 and has raised its interim dividend 7.6% to 31p.

Peter Crook, chief executive, said: “I am pleased to report further strong growth at Vanquis Bank whilst the continuing weak conditions within CCD confirm the importance of the cost reductions implemented in July. The group overall has performed in line with its internal plan through the nine months ended 30 September and is expected to continue to do so for 2013 as a whole.
 
“The group’s funding position remains strong and the sound progress made by the Vanquis Bank credit card pilot in Poland and in developing an online direct repayment product to capture a greater share of the non-standard UK market are exciting opportunities to augment the group’s medium-term growth prospects.”