Lower bad debt charges at Provident Financial

Sub-prime lender Provident Financial reported a 12% increase in full year pre-tax profit, helped by lower bad debt charges.

The firm, which posted pre-tax profit of £162.1m compared to £144.5m 2010, said it was confident of further growth in the year ahead. Revenue for the year increased to £910.8m from £866.4m before.

Provident Financial said pressure on customers' disposable incomes has continued in a weak employment market however it said tight credit standards would remain in place.

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The group, which has renewed its own core bank facilities to 2015, said there had been a reduction in home credit rate of impairment to 32.1% of revenue compared to 32.9% in 2010 after a strong collections performance.

Chief executive Peter Crook, "The group has started 2012 with the benefit of very sound credit quality in both businesses. Accordingly, the Consumer Credit Division has seen a robust collections performance through the first two months of the year and Vanquis Bank has made a strong start to 2012. The group is in a position to make further good progress in 2012."

Provident has recommended a final dividend of 42.30p, taking the total dividend 8.7% higher than the year before.

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