The Financial Conduct Authority (FCA) has launched an investigation into subprime car finance provider Moneybarn, part of Provident Financial.
The probe relates to Moneybarn’s affordability assessment process and to its treatment of customers in financial difficulties.
“The Provident Financial Group aims to act responsibly in all its relationships, and to play a positive role in the communities it serves,” the company said.
“Since [Moneybarn received authorisation] the FCA has continued to discuss certain processes with Moneybarn and Moneybarn has made a number of process improvements, including to the way it deals with future loan terminations.
“The Company will work collaboratively with the FCA to investigate the remaining concerns and resolve any outstanding related issues as soon as practicable.”
Another of Provident’s divisions, subprime credit card provider Vanquis Bank, has been under FCA investigation since at least August over a repayment plan product. Additionally, the company has been restructuring its home credit trading business after a change in its internal functioning led to higher-than-expected overhead costs.
Following the resignation of managing director Peter Crook in August, Manjit Wolstenholme took on the role of executive chairman in a turnaround bid for the company. However, Wolstenholme suddenly passed away on 24 November.
Malcolm Le May has since stepped in as an interim replacement for Wolstenholme. Last week, he has also become chairman of the nomination committee, tasked with looking for a new chief executive. As part of the reshuffle, a senior independent director (Stuart Sinclair) and a chairman of the remuneration committee (Andrea Blance) were also appointed.
At the time of writing, shares for Provident were trading at 772p, 17% lower than before the announcement.