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Provident Financial Benefits As Banks Shun Subprime Lending

Sep 10, 2007

DOOR-TO-DOOR credit company Provident Financial said it has not seen much evidence of poorer households struggling to make up their payments.

The Citizens Advice Bureau today claimed it had seen record numbers of people seeking advice over debt.

But Provident said defaults in its home credit division rose just 0.9% to 107.4 million in the first half of the year, and did not expect that to increase in the second half.

The company had dodged the worst of the credit crunch by borrowing about 1 billion to lend out to its customers in July, before the markets turmoil bit.

In fact, Provident said it was benefiting from the crisis as High Street banks had moved out of its subprime lending homeland.

It made a one-off gain in the first six months of the year of 68.4 million from selling its car insurance arm to GMAC, and pre- tax profits jumped 19% to 38.2 million..

(c) 2007 Evening Standard; London (UK). Provided by ProQuest Information and Learning. All rights Reserved.

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