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Vanquis Banking Group PLC said pretax profit fell on higher central costs due to the rollout of its shared services model, but says its outlook is strong for 2023.
The Bradford, England-based banking group formerly known as Provident Financial reported total income in 2022 of £480.7 million, edging up 0.4% from £478.7 million in 2021, while net interest income was £428.1 million, up 1.7% from £420.9 million a year ago.
Pretax profit was £110.1 million, falling 23% from £142.2 million, with the decrease partly due to a rise in central costs to £30 million, from £18 million.
Vanquis declared a final dividend of 10.3 pence per share, bringing the total annual dividend to 15.3p, up 28% from 12.0p the year prior. The increased dividend reflects ‘the group’s strong capital position and the board’s confidence in the group’s outlook’.
Looking ahead, Vanquis said positive momentum seen in the fourth quarter of 2022 has continued into 2023, particularly in its vehicle finance and personal loans business. Group costs are expected to be ‘broadly flat’ in 2023.
Chief Executive Officer Malcolm Le May said: ‘We have delivered a substantial amount of progress since I took over as CEO in February 2018 and 2022 was another important year of strategic development for the group.
‘We reinforced our repositioning as a leading specialist banking group in the mid-cost and near-prime parts of the credit market with a focus on lower risk customers, which has resulted in credit risk across the group reducing materially since 2019.’
Vanquis Banking shares rose 2.5% to 238.20 pence each in London on Friday morning.
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