Provident Financial returns to interim profit as wind-down costs fall

The logo of Provident Financial Group is seen on a smartphone in front of the stock chart shown in this illustration taken December 1, 2021. REUTERS/Dado Ruvic/Illustration

July 27 (Reuters) – British subprime lender Provident Financial ( PFG.L ) returned to interim profits on Wednesday as costs related to the liquidation of its home loans unit fell and demand held steady strong in its credit card business.

Lenders, who benefited from a surge in lending as the market recovered from the pandemic, are now grappling with a possible rise in bad loans as the cost-of-living crisis deepens.

The London-listed company, which has placed its home-lending unit under management scandal since May 2021 after a surge in complaints, said it is in talks with regulators about future requirements of capital after the liquidation of the unit.

Provident is also looking to focus more on lower-risk customer segments amid uncertain macroeconomic conditions.

The company reported a pre-tax profit of 37.3 million pounds ($44.96 million) for the six months ended June 30, compared with a loss of 44.2 million pounds in the period from last year

($1 = 0.8296 pounds)

Reporting by Sinchita Mitra in Bangalore; Edited by Subhranshu Sahu

Our standards: the Thomson Reuters Trust Principles.