30th Apr 2014 13:02
LONDON (Alliance News) - International Personal Finance PLC Wednesday said its first-quarter pretax profit increased by GBP3.6 million to GBP12.7 million, and unveiled a GBP50.0 million share buyback programme.
In a statement covering the first three months of 2014, the lender said the rise in pretax profit was driven by strong growth in credit issued and good credit quality.
Revenue increased to GBP194.9 million from GBP177.6 million, while impairments rose to GBP74.7 million from GBP69.3 million. Customer numbers increased by 7.0%.
"In early April we successfully refinanced our eurobond at a materially lower cost and today's announcement of a share buyback of approximately GBP50.0 million to reduce the capital ratio to around 45% demonstrates our commitment to further increasing shareholder value. We are well positioned to deliver further growth as the year progresses," Chief Executive Gerard Ryan said in a statement.
International Personal Finance said it reviewed its capital ratio after refinancing its eurobond, and concluded that it is appropriate to reduce the equity to receivables ratio to around 45%.
However, the lender has had to pay close attention to the debate in a number of its European markets where regulators are looking at rules on interest rate caps.
There are proposals for rate caps in Poland, Czech Republic, and Bulgaria. In Slovakia, a law has been passed giving powers to the Ministry of Finance to implement a rate cap and prohibit loans being delivered in cash.
International Personal Finance said it is awaiting the date of a court appeal process that will see it challenge a decision made by UOKiK, the Polish Office of Consumer Protection and Competition, in December 2013, that found the way it calculates its annual percentage rate amounts to "a collective infringement of consumer interests".
The decision led to a fine of about GBP2.4 million.
"We also have a good track record of evolving our products and services to meet new regulatory requirements. We do not expect any of these matters to have a material impact on our business performance or growth prospects," International Personal Finance said in a statement.
International Personal Finance shares were Wednesday quoted at 551.00 pence, down 1.5%.
By Samuel Agini; [email protected]; @samuelagini
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