The former boss of Provident Financial today hailed a year of “massive growth” for one of its sub-prime lending rivals.
John van Kuffeler, now the chief executive of Non-Standard Finance (NSF), said it had capitalised on a “major misstep by Provident”.
NSF impressed City analysts with 30 per cent like-for-like growth in its loan book while reducing loan impairments from 29.2 per cent to 24 per cent. A delighted van Kuffeler told City A.M. this meant NSF had achieved the “Holy Grail of lending”.
Agent and staff numbers grew from 1,100 to 1,750. Some 440 agents and 100 staff moved from Provident, leading to NSF’s home credit business swelling by 53 per cent.
“Clearly in the home credit business we had a sort of one-off,” said van Kuffeler, who oversaw Provident’s rise from lending minnow to FTSE 100 giant. “A major misstep by Provident that allowed us to take a major chunk of their business.”
Customers and agents continue to “flow” from Provident to NSF, its boss added.
NSF has previously set a medium-term target of 20 per cent year-on-year growth. Despite 2017 far exceeding this, van Kuffeler said he would stick to current guidance.
City analysts said the only negative in NSF’s earnings was an increase in the lender’s cost base to manage loan book growth. Shore Capital’s Gary Greenwood said this meant 2018 profit projections would need to be moderated.
He added: “Even so, we still anticipate strong double-digit adjusted earnings growth and strong dividend growth in the current financial year, noting the confident outlook statement.”
Liberum analysts, meanwhile, were impressed by annual dividends growing by 83 per cent.
NSF share price rose 0.6 per cent in morning trading.