Half Yearly Report

Private & Commercial Finance Group plc

("Private & Commercial Finance", "PCF" or the "Group")

Interim Results for the six month period ended 30 September 2013

Private & Commercial Finance Group plc (AIM: PCF), the AIM quoted finance house, today announces its unaudited interim results for the six month period ended 30 September 2013.

Financial Highlights:

· Reported profit before tax up 48% to £0.5 million (2012 - £0.3 million)

· Return on average assets increased to 1.2% (2012 - 0.8%)

· Basic earnings per share up 50% to 0.6p (2012 - 0.4p)

· Net assets up 9% to £9.9 million (2012 - £9.1 million)

· Fully diluted net assets per share of 11.7p

· Loan loss provisioning charge fell by 14% to £1.1 million (2012 - £1.3 million)

· £20 million of unearned finance charges to contribute to income in future years (2012 - £16 million)

Business Highlights:

· £4.1 million fund raising completed in September 2013

· Committed facility headroom of £15 million to fund portfolio growth

· 51% increase in new business originations to £27.3 million in the period (2012 - £18.0 million)

· 34% increase in returning consumer finance customers

· Portfolio has grown 9% to £86 million (2012 - £79 million)

Commenting on the results David Anthony, Chairman of PCF, said:

"Our performance continues to improve. This reflects new business growth along with increased efficiencies and quality in our portfolio. We are now looking at a number of initiatives to support and accelerate Private & Commercial Finance's progress, including applying for a deposit-taking licence, and I am confident that management will continue to deliver further gains in shareholder value."

Scott Maybury, CEO of PCF, added:

"The Group has built on last year's encouraging results with further strong progress in the first half of our current financial year. We have achieved a notable increase in new business originations and are pleased to report a return to portfolio growth. Our balance sheet is stronger than ever, we are continuing to improve the quality of our overall portfolio and we have taken a further step towards our target of a 2% return on average assets."

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For further information, please visit www.pcfg.co.uk or contact:

Private & Commercial Finance Group plc Tel: +44 (0) 20 7222 2426

Scott Maybury, Chief Executive Officer

Robert Murray, Managing Director

Zane Kerse, Finance Director

Tavistock Communications Tel: +44 (0) 20 7920 3150

John West / Niall Walsh

Westhouse Securities (Nominated Advisor) Tel: +44 (0) 20 7601 6100

Richard Baty

Daniel Stewart & Co (Nominated Broker) Tel: +44 (0) 20 7776 6550

Martin Lampshire

About Private & Commercial Finance Group plc

Established in 1994, Private & Commercial Finance Group plc is an AIM-quoted finance house which has two main operating divisions:

· Consumer Finance provides a range of specially tailored finance products for consumers

· Business Finance finances vehicles, plant and equipment for SMEs

The Group has a highly efficient and scalable business model, utilising its specially developed internet-based proposal system to service national networks of brokers and suppliers.

Chairman's statement

Group profit before tax for the period ended 30 September 2013 increased by 48% to £503,277 (2012 - £339,466).

The first six months of this financial year have been focussed on new business initiatives, growing the portfolio and improving profitability. Initiatives launched at the beginning of the year have resulted in a 51% increase in new business originations to £27.3 million (2012 - £18.0 million) and the portfolio growing to £86 million. We are returning to a pattern of sustained growth, having reined in new business during the last five years.

Return on average assets increased by 33% to 1.2% (2012 - 0.8%), a further step towards our target of 2%.

We concluded the final tranche of the £10 million convertible loan note fundraising announced in October 2012 and subsequently repaid the maturing 2013 loan notes as planned on 30 September 2013. This transaction has provided a platform for further growth and we have utilised the resultant senior debt facilities to grow our portfolio of quality receivables in the consumer motor finance and SME asset finance markets. As at 30 September 2013 the Group had £15 million of committed facility headroom at its disposal.

Financial Review

Turnover increased in the period as the portfolio returned to growth and the gross profit margin remained stable at 29%. Our increased profit resulted from a further improvement in the level of defaulting accounts, tight cost control and the benefits of operational gearing. In line with the growth in the portfolio, the unearned finance charges held on the balance sheet have increased to £20 million (2012 - £16 million) providing a quality and certainty of income for future years.

Basic earnings per share increased to 0.6p (2012 - 0.4p). The Group's net assets increased by 9% to £9.9 million (2012 - £9.1 million) and, on a fully diluted basis, the net asset value per share stands at 11.7p. This calculation is based on all issued convertible loan notes converting in accordance with the terms of their issue.

The portfolio is performing to management expectations. New business credit quality is excellent, with the majority of new business originated in our highest two credit grades. Together with improving delinquencies, this contributed to a 14% decrease in the loan loss provisioning charge in the period.

Administrative expenses as a percentage of gross profit continued to fall to 56.8% (2012 - 60.8%) and further improvements can be expected as the portfolio increases in size.

Capital and Funding

The capital base of the Group continues to strengthen and the leverage ratio, excluding unsecured convertible debt, stands at 7.2 (2012 - 8.0). The debt facilities available for new business now total £96 million, providing adequate headroom for our immediate growth plans.

Having positioned the Group to deliver portfolio growth, the next strategic initiative will be the diversification of funding from reliance on the wholesale banking market towards less expensive retail deposits. A successful application for a deposit-taking licence is a medium-term objective which will take a minimum of 15 months. We recognise that the process will not be without its challenges but the Group has 20 years' experience in its chosen sectors. We are confident that this strategy is both a logical next step and an achievable goal, as the Group will combine the required disciplines with an established business model which has shown itself to be robust in the most difficult of economic circumstances. The regulatory and political environments are also receptive to new applicants as governmental and consumer pressure mounts to broaden the banking sector.

Current Trading

Following a period of market research and broker feedback, a number of new business initiatives were introduced at the beginning of the year. These included new products, revised terms of business, a streamlining of operational procedures and a range of new broker and customer incentives.

New business activity has been particularly strong in the consumer motor sector, reflecting improved confidence and the first signs of a consumer-led economic recovery. Returning customers increased by 34% to £2 million (2012 - £1.5 million) thanks to a successful remarketing campaign. Overall, consumer new business in the first six months totalled £15.9 million (2012 - £9.5 million), an increase of 66%.

Business asset finance has also seen good growth. New business originations increased by 34% to £11.4 million (2012 - £8.5 million). This growth is coming off a low base, as confidence among small businesses has been lagging behind the consumer sector. However, we believe volume growth will now strengthen as the economic recovery gathers pace and SMEs look to replace business critical assets.

In addition, we continue to look for portfolios of receivables to acquire and new business opportunities in niche industry sectors or asset classes.

Staff

The progress made by the Group is largely down to our staff's ability to deliver on the promised growth strategy and their sterling efforts to reduce the level of non-performing accounts. I would like to thank them for their commitment throughout the period.

Outlook

Recent portfolio growth is only just starting to be reflected in increased gross profit. The trend will accelerate in the second half of the year and, as the benefits of operational gearing start to show through, we anticipate further progress towards our target of a 2% return on average assets. Our performance during the period means we can view the remainder of the current financial year with some confidence, and I look forward to reporting on this and progress in our deposit-taking licence application in the Annual Report for the year ending 31 March 2014.

GROUP INCOME STATEMENT

GROUP STATEMENT OF COMPREHENSIVE INCOME

GROUP BALANCE SHEET

GROUP STATEMENT OF CHANGES IN EQUITY

GROUP STATEMENT OF CASH FLOWS

NOTES TO THE INTERIM REPORT

1. The interim results are unaudited and do not constitute statutory accounts as defined by section

434 of the Companies Act 2006. The comparative figures for the year ended 31 March 2013 are based on the statutory accounts of the Group for that period and have been reported on by the Group's auditor and delivered to the Registrar of Companies. The report of the auditors was unqualified and did not contain a statement under section 498 of the Companies Act 2006.

2. The interim results have been prepared on the basis of the accounting policies set out in the

Annual Report & Financial Statements for the year ended 31 March 2013.

3. These interim consolidated financial statements have been prepared in accordance with IAS 34

'Interim Financial Reporting' as adopted by the European Union.

4. The Group's turnover represents gross rentals and instalments from the hire, financing

and sale of equipment, and the provision of related fee-based services, stated net of Value Added

Tax.

5. The Group operates in the principal areas of consumer finance for motor vehicles and business

finance for vehicles, plant and equipment. All revenue is generated in the United Kingdom.

Turnover, profit on ordinary activities before taxation and loan loss provisioning charge are detailed below:

6. The income tax rate is 35%, representing the best estimate of the annual effective tax rate applied to operating profit before tax for the six month period. The effective tax rate for the period is higher than the standard rate for current Corporation Tax in the UK of 23% due to the effect of the reduction in the Corporation Tax rate on the deferred tax asset.

7. The calculation of basic earnings per ordinary share is based on a profit of £327,133 for the period on 52,837,488 ordinary shares, being the weighted average number of ordinary shares in issue during the period.

The calculation of diluted earnings per ordinary share is based on profit of £511,295 for the period, before deducting interest on the convertible loan notes of £184,162, on 122,377,841 ordinary shares, being the dilutive weighted average number of ordinary shares in issue during the period.

8. The Group's loans and receivables portfolio of £86,124,202 is reported net of unearned future finance income of £19,633,066.

9. In September 2013, PCF issued £4.1 million of £1 convertible unsecured loan notes at par. The loan notes have a final maturity date of 30 September 2016 and carry an interest rate of 6%. £3 million of the proceeds were used to repay the Group's 8% and 10% convertible unsecured loan notes that matured on 30 September 2013. The balance of the proceeds of £1.1 million will be used to fund the future growth of the Group.

The issue of the loan notes completed the Group's fundraising of £10 million announced in October 2012. As at 30 September 2013, 19,070 of loan notes had been converted at 8.5p with 9,980,930 remaining in issue. Somers Limited (previously Bermuda National Limited) is the beneficial holder of 8.5 million loan notes which, if converted, would result in the issue of a further 100 million ordinary shares to Somers Limited.

10. A copy of the Interim Report is being sent to all shareholders and convertible loan note holders. Further copies can be obtained from the Company Secretary at Brandon House, 180 Borough High Street, London SE1 1LB or can be downloaded from our website, www.pcfg.co.uk.