Profits soar at home credit business

Home credit business Provident Financial enjoyed a pre-tax profits rise of 11.1% from £130.1m to £144.5m last year.

In its preliminary results for the year ended December 31, the Bradford-based company said it had increased customer numbers from 2.28m to 2.41m.

In its consumer credit division, Home Credit pre-tax profit crept up to £129.1m compared to £128.9m in 2009.

Provident’s Vanquis Bank operation’s profit before tax shot up by 89.4% to £26.7m, with customer growth of 27.7%.

Chief executive Peter Crook said: “I am pleased with the strong performance we delivered in 2010.

“Through continuing to focus on the needs of our customers, we have been able to expand the flow of credit to consumers whilst continuing to lend responsibly. By careful management of yield, impairment and costs, we have delivered earnings growth well ahead of receivables growth.

“We have also made excellent progress in further diversifying our funding base and now have banking headroom of £370m following additional funding raised through private placements since the year end.

“Both Home Credit and Vanquis Bank have made a good start to 2011. Combined with our strong funding and liquidity position, we are well placed to continue to deliver good-quality growth through this year.

“When the UK economy begins to recover, we see an enhanced opportunity to build on our leading position in the UK non-standard consumer lending market.”