Action to shore up troubled lender

The new head of troubled sub-prime lender Provident Financial has ordered a management shake-up at the firm’s consumer credit business, days after the company issued at a catastrophic profit warning.

Manjit Wolstenholme, who took on the role of executive chairman after boss Peter Crook quit on Tuesday, has removed Andy Parkinson as managing director of the division as part of a review.

He will be replaced by Chris Gillespie, who will be “establishing relationships with customers, bringing collections back to a normal level, and stabilising the operation of the business”.

As part of turnaround efforts, Provident, which has around 2.5 million customers, launched a new home credit model in July with the aim of moving from self-employed door-to-door agents to full-time “customer experience managers”.

However, the lender warned earlier this week the rate of progress being made is “too weak” and that its pre-exceptional loss this year is likely to be in the range of £80 million to £120m, which resulted in shares plunging 70%.

To compound the misery, the firm revealed the Financial Conduct Authority is investigating a Repayment Option Plan Provident offers through its Vanquis Bank arm.

Ms Wolstenholme said: “My review of the business is ongoing as we move towards stabilising the Provident home credit business and improving the service to our customers.

“These are my first appointments and I intend to work closely with the new team on turning the home credit business around and to putting a plan in place to deliver good results for the company.”

Manjit Wolstenholme is trying to turn around the troubled lender.