Provident Financial shares plunge as FCA launches car loans investigation


Moneybarn faces a regulatory investigation

Shares in British subprime lender, Provident Financial, tumbled almost 17 per cent in early trading today after Financial Conduct Authority (FCA) announced it had launched an investigation into a car loans firm controlled by the lender.

According to reports, nearly 20 per cent has been wiped off the value of Bradford-based lender after the the watchdog’s investigation announcement into Moneybarn. FCA will focus on how Moneybarn decides whether applicants can really afford its loans, and on how it treats customers who fall into financial difficulty.

The embattled company said: “The Provident Financial group aims to act responsibly in all its relationships, and to play a positive role in the communities it serves. The company will work collaboratively with the FCA to investigate the remaining concerns and resolve any outstanding related issues as soon as practicable.”

The company has already crashed out of the FTSE 100 on the back of two profit warnings and another FCA probe, parted with its chief executive and cancelled a dividend for shareholders. Last month it announced Manjit Wolstenholme, its executive chairman, had died suddenly.