Investment accounts
Adult accounts
Child accounts
Choosing Fidelity
Choosing Fidelity
Why invest with us Current offers Fees and charges Open an account Transfer investments
Financial advice & support
Fidelity’s Services
Fidelity’s Services
Financial advice Retirement Wealth Management Investor Centre (London) Bereavement
Guidance and tools
Guidance and tools
Choosing investments Choosing accounts ISA calculator Retirement calculators
Share dealing
Choose your shares
Tools and information
Tools and information
Share prices and markets Chart and compare shares Stock market news Shareholder perks
Pensions & retirement
Pensions, tax & tools
Saving for retirement
Approaching / In retirement
Approaching / In retirement
Speak to a specialist Creating a retirement plan Taking tax-free cash Pension drawdown Annuities Investing in retirement Investment Pathways
Interest earning balances slip at Vanquis
(Sharecast News) - Vanquis Banking Group reported gross customer interest earning balances of £2.23bn at the end of its first quarter on Wednesday, reflecting a slight decline from the £2.35bn it reported as at 31 December. The London-listed company said its net interest margin increased to 19.3% from 19% at the end of December 2023, while its CET1 ratio strengthened to 20.8% compared to 20.5% previously.
Retail funding also saw a slight uptick to 84.1% from 83.7% over the same period.
New customer acquisitions grew as expected during the quarter, but the board put the decline in gross customer interest earning balances to strategic measures implemented at the end of 2023 to moderate unprofitable lending growth.
That decrease was further influenced by reduced customer spending in the current economic climate and higher-than-anticipated debt repayments.
The increase in net interest margin was primarily attributed to repricing in cards at the end of 2023.
Despite the fluctuations, the board said the company's underlying credit quality remained stable.
The group said it was continuing its focus on efficiency and simplification, with costs aligning with expectations.
Vanquis Banking Group said it was well-capitalised with robust levels of liquidity and funding, noting that £50m of TFSME funding was repaid early to ensure prudent liquidity management.
In terms of customer proposition updates, several initiatives were launched in April, including the relaunch of personal loans to existing customers and the signing of second charge mortgage forward flow agreements with Selina Finance and Interbridge Mortgages.
Additionally, partnerships with H&T Pawnbrokers and the introduction of new savings products were designed to diversify offerings and cater to customer needs.
Operational efficiency remains a priority, with a focus on delivering "brilliant basics" and optimising collections while assisting customers in managing their finances.
However, complaint volumes from a single complaints management company remained high, prompting the development of flexible and cost-effective complaint handling capabilities, including the deployment of artificial intelligence for complaint logging automation.
Legal proceedings were ongoing against the complaints management company responsible for what Vanquis said were spurious complaints, while proactive engagement with regulators was looking to address industry-wide complaints issues in the best interest of customers.
"Since launching our new strategy on 27 March we have moved at pace from strategy definition to implementation of key initiatives," said chief executive officer Ian McLaughlin.
"We still have challenges to address as we have previously described, but we are making good progress in building our customer proposition and risk management capabilities to meet growing customer needs.
"In parallel, we are improving operational efficiency and continuing our investment in technology."
At 1004 BST, shares in Vanquis Banking Group were down 0.59% at 56.26p.
Reporting by Josh White for Sharecast.com.
Share this article
Related Sharecast Articles
Important information: This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to one of Fidelity’s advisers or an authorised financial adviser of your choice. When you are thinking about investing in shares, it’s generally a good idea to consider holding them alongside other investments in a diversified portfolio of assets. Past performance is not a reliable indicator of future returns.
Award-winning online share dealing
Search, compare and select from thousands of shares.
Expert insights into investing your money
Our team of experts explore the world of share dealing.
Policies and important information
Accessibility | Conflicts of interest statement | Consumer Duty Target Market | Consumer Duty Value Assessment Statement | Cookie policy | Diversity, Equity & Inclusion | Doing Business with Fidelity | Diversity, Equity & Inclusion Reports | Investing in Fidelity funds | Legal information | Modern slavery | Mutual respect policy | Privacy statement | Remuneration policy | Security | Statutory and Regulatory disclosures | Whistleblowing policy
Please remember that past performance is not necessarily a guide to future performance, the performance of investments is not guaranteed, and the value of your investments can go down as well as up, so you may get back less than you invest. When investments have particular tax features, these will depend on your personal circumstances and tax rules may change in the future. This website does not contain any personal recommendations for a particular course of action, service or product. You should regularly review your investment objectives and choices and, if you are unsure whether an investment is suitable for you, you should contact an authorised financial adviser. Before opening an account, please read the ‘Doing Business with Fidelity’ document which incorporates our client terms. Prior to investing into a fund, please read the relevant key information document which contains important information about the fund.
This website is issued by Financial Administration Services Limited, which is authorised and regulated by the Financial Conduct Authority (FCA) (FCA Register number 122169) and registered in England and Wales under company number 1629709 whose registered address is Beech Gate, Millfield Lane, Lower Kingswood, Tadworth, Surrey, KT20 6RP.