• Vanquis, formerly Provident Financial, has returned to profitability in Q1 2025, driven by strategic initiatives and reduced complaint costs.
• Its shares surged by 9% following the positive update.

Vanquis Bounces Back After Major Losses

Vanquis, formerly known as Provident Financial, has made a remarkable turnaround, swinging back to profitability in the first quarter of 2025. After facing significant losses of £34.8 million last year due to a surge of no-win, no-fee complaints related to its credit card division, the Bradford-based financial services company has now reported positive results.

Strategic Recovery Boosts Performance

According to the company’s latest trading update, gross customer interest-earning balances rose by 1.8% in the three months ending March, reaching £2.3 billion. The net interest margin remained steady at 17.8%, unchanged from the fourth quarter but slightly lower year-on-year. Despite the challenges, Vanquis managed to keep overall costs under control and maintained strong credit quality, indicating that its customers continue to demonstrate financial resilience.

Ian McLaughlin, Chief Executive of Vanquis, emphasized that the group’s strategic initiatives are on track. “Vanquis’ strategic delivery remains on track. The group returned to profitability and grew gross customer interest-earning balances, building on the momentum shown in the fourth quarter of 2024,” McLaughlin stated.

Ombudsman’s Revised Fee Structure Provides Relief

Another positive development for Vanquis came from the Financial Ombudsman Service’s revised fee structure, which took effect on April 1. This change has led to a significant reduction in unmerited complaints from claims management companies, aligning complaint costs with expectations. McLaughlin expressed optimism over this development, which has contributed to the company’s improved performance.

Shares Surge as Investors React Positively

Vanquis’ shares surged by 9% to 76.34p following the positive update, reflecting renewed investor confidence in the company’s strategic direction and financial stability.

A New Chapter for Vanquis

Founded in 1880 as a doorstep lender under the name Provident Financial, Vanquis has undergone a strategic transformation in recent years. The company exited sub-prime doorstep lending in 2023 and rebranded to better reflect its focus on credit card services. With its latest financial performance, Vanquis appears to be successfully navigating a path to sustained profitability.