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Provident Financial Group could face a payout of £300m, according to stock analysts from the Europe division of Royal Bank of Canada.
Group Editor
The analysts said the payout would emerge from requirements around customer redress, regulatory penalties and administration costs for the mis-selling of a product by one of Provident’s businesses.
To recap, the home credit provider has endured the following setbacks, among others, in just the past two months since its troubles were first revealed on August 22:
The mis-sold product referred to is the repayment option plan by Vanquis Bank – the analysts compared this to the mis-selling of PPI.
Analysts have also recommended Provident shares will underperform and are not investible until greater clarity is received, which they said is not likely to be until next year at the earliest.
They said: “Provident’s financial deterioration is rapid and it remains questionable whether the company’s issues are anywhere near under control.”
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