Amigo sees 76% drop in revenue

Between these two periods revenues for the business dropped from £75.7m to £17.8m. This reduction in revenue as the book runs off – alongside the increase in complaints provision – also led to a reported loss before tax of £21.3m, a drop of £22.9m when compared to the £1.6m profit the firm returned in the first nine months of 2021.

Additionally, it saw a 66.1% reduction in its net loan book – going from £180.7m to £61.2m, with this primarily driven by the ongoing run off of its legacy loan book combined with a very limited number of new lending during the period.  

It did, however, see a 44.5% reduction in its year-on-year complaints provision – going from £347.5m to £192.8m – with this coming as a result of the sanctioning of the scheme of arrangement, although this provision increased on an underlying basis since the half year number of £191.4m in this financial year, largely as the result of a higher expected uphold rate. 

Meanwhile, it has described its overall collections activity as “robust” despite the increase in the cost of living and the counted rise in delinquency as the book runs off. This has been driven by continued post-charge-off recoveries, while early settlements have slowed.  

Amigo Loans’ chief executive Danny Malone said: “In recent weeks we have made progress with the capital raise, despite extremely difficult market conditions, but have yet to secure the equity funding needed and conversations with potential investors are ongoing.  

“Positively, Amigo’s pilot RewardRate lending programme, launched under regulatory supervision, is now building momentum in a market where demand is strong.  

“This is a clear indication of the need for a mid-cost lending solution for people not served by mainstream lenders and, as directors, we fully believe in the considerable growth potential of our business and the role it can play in greater financial inclusion and mobility.

“Clearly, we continue to face uncertainty and we recognise that this is a very challenging time both for our shareholders and our employees. The board would like to assure them that it is leaving no stone unturned as it seeks to secure additional equity funding and deliver the best outcome possible for all our stakeholders.”