In a stock exchange announcement, the subprime lender confirmed that interim chairman Malcolm Le May will be taking over as chief executive officer with immediate effect.
Le May was selected following a nomination committee process undertaken by the board, which was spearheaded by senior independent director Stuart Sinclair. In making this decision, the board consulted with select majority shareholders and discussed the appointment with the Financial Conduct Authority (FCA).
“It became clear to the board as the search was progressing that the executive chairman who has been instrumental in driving the business forward over recent months was the best person to complete the turn around of Provident Financial Group as the new group chief executive officer,” Sinclair said on Friday.
On his appointment, Le May commented: “My key objective is to execute a turn around of the group. We will re-establish a stronger customer focused business; conclude with our regulators the issues surrounding Vanquis Bank and Moneybarn; continue the progress being made in our Home Credit business and restore it as the pre-eminent business in its market; and ensure our businesses collaborate for the benefit of our customers and our shareholders.”
Markets were cheered by the update, the first good piece of news Provident Financial has issued, following a wave of bad press last year that wreaked havoc on its share price and brought pain for sizeable stakeholders Neil Woodford and Invesco Perpetual’s Mark Barnett.
Its share price was up 5.5% to 707p, at the time of writing, recouping some of the ground it lost in January after posting a loss in its last trading update.
However, the doorstep lender’s shares are still down about 24% from where they were the beginning of the year and are some 74% lower than the price they fetched 12-months ago.
The consumer credit company has been effectively rudder-less for the past five months, after the hasty retreat of disgraced boss Peter Crook. Crook resigned as chief shortly after the firm issued its second profit warning in a matter of months, which caused its share price to fall over 70%.
His successor, interim executive chairman Manjit Wolstenholme, passed away suddenly last year, months into her new role and while the firm continued its hunt for a permanent replacement.
Top brass reshuffle
In addition to confirming Le May’s appointment, the firm also announced a number of other changes on the executive level and to its board.
Chris Sweeney, the managing director of Vanquis Bank, is set to be promoted to deputy group chief pending FCA investigation into its credit card repayment option plan (ROP) has been successfully concluded.
Sinclair will take over for Le May as the new interim chairman. His previous position as senior independent director will be filled by Andrea Blance.
Moving forward, the board will be appointing a new external chairman, as well as two additional non-executive directors.
On the state of its other businesses, Provident Financial said the home credit business “continues to make good operational progress, and discussions continue with the FCA in relation to the Vanquis Bank and Moneybarn investigations”.
