May 9, 2018 / 6:49 AM / in a year

UPDATE 1-Provident Financial says recovery plan on track

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May 9 (Reuters) - British sub-prime lender Provident Financial said on Wednesday its recovery plans would deliver 2018 results in line with internal plans while its Vanquis bank unit reported profits ahead of earlier forecasts.

Shares in the company, which have fallen more than 70 percent in the aftermath of a pair of profit warnings last year, were projected to rise as much as 5 percent after opening.

Provident, which has been dealing with regulatory investigations into elements of its business, swung into the red last year, prompting the departure of CEO Peter Crook and the suspension of its dividend.

Vanquis’ new customer bookings fell 28.7 percent to 87,000, but were in line with management plans, the company said, but customer numbers rose 7.8 percent to 1.7 million at the end of the first quarter.

New business volumes at Moneybarn, Provident’s car and van financing arm, also grew 10 percent, with customer numbers rising 24 percent to 53,000.

Provident said Moneybarn was continuing to work with the Britain’s Financial Conduct Authority watchdog on its investigation into how the unit assesses whether customers can afford loans and how it deals with defaulters.

The company raised 331 million pounds in a share sale earlier this year, upping its capital by more than a third to meet the costs of resolving a probe by the FCA into Vanquis. (Reporting by Arathy S Nair in Bengaluru; editing by Patrick Graham)

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