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Provident Financial breaks with history to change name, CEO to step down

By Abigail Townsend

Date: Thursday 26 Jan 2023

Provident Financial breaks with history to change name, CEO to step down

(Sharecast News) - Provident Financial Group is to change its name after more than 140 years to Vanquis Banking Group, the subprime lender said on Thursday.
It also announced the departure of chief executive Malcolm Le May, who will be replaced by current head of Bank of Ireland UK, Ian McLaughlin.

Founded in 1880 as a doorstep lender, PFG faced a surge in customer complaints in recent years, hitting both profits and the share price.

Previously chair, Le May took over as chief executive in 2018 and helped turn the business around. The loss-making consumer credit business, which included doorstep lending, was shut in 2021, and it now specialises in mid-cost and near-prime lending, including credit cards, vehicle finance and mortgages.

The group said the name change to Vanquis, its credit card arm, would better reflect its mix of lending products.

Patrick Snowball, chair, said Le May, 65, had led the "transformation of PFG into a specialist banking group helping mid-cost and near-prime credit customers with their financial needs, putting the group in a strong position for the future".

Le May said: "Having been at PFG for almost nine years...I feel the time is right for me to step down. The group has changed significant since I joined and is now repositioned as a specialist banking group."

Updating on trading, PFG said it had seen "strong momentum" across each of its products during the fourth quarter.

It continued: "Notwithstanding the challenging macroeconomic backdrop, including persistently high inflation, the group remains well-positioned with strong capital and funding positions."

PFG is due to publish full-year results on 31 March, with the name change also becoming effective that month. Le May will remain as chief executive until McLaughlin joins in the summer.

Peel Hunt, which has an 'add' recommendation on the stock, said: "Malcolm has been seen as a safe pair of hands and his departure, although not unexpected given the length of service, is not in itself positive, in our view.

"Finally the group is to change its name, which we view as appropriate as it is able to fund all receivables through banking deposits. Overall, it was a net positive announcement given the shares trade cheaply."

As at 1030 GMT shares in PFG were ahead 2% at 219.8p.


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