Provident Financial’s growth-as-expected prompts City firm to issue interim dividend

Provident Financial announced solid growth in line with market expectations for the first half of the year and is set to recommend an interim dividend of 5p per share.

The specialist banking group’s continuing profit before tax was at £54.3m compared to £63.5m in the first half of 2021 which the company said showed growth in receivables year-on-year as well as new customer bookings which were partially offset by the planned rise in costs.

The group’s statutory profit before tax of £37.3m, compared with H1 2021’s loss before tax of £44.2m included £3.7m of corporate costs incurred centrally and £9.6m of discontinued items from the continued wind-down of its Consumer Credit Division.

Total Group liquidity at the end of June stood at approximately £520m (H1’21: £510m) including approximately £430m (H1’21: £280m) held by Vanquis Bank, of which £145m is surplus non-bank funds placed on deposit with the Bank.

“I am delighted with the Group’s first half performance. We have delivered growth and returns in line with market expectations,” said CEO Malcolm Le May. 

“We are all acutely aware of the potential challenges that the macroeconomic environment might present. However, we are confident that our increased focus on lower risk customer segments together with our capital strength position us well to withstand the challenges ahead, support our customers and deliver sustainable growth and returns to our shareholders.”

The Group’s total liquidity at the end of June this year was around £520m, compared to £510m last year. The proposed interim dividend of 5p is “consistent with its capital management framework of aiming to provide attractive and sustainable returns to its shareholders,” the company said.