Amigo has warned over profits as mis-selling compensation demands continue to flood in.
The guarantor lender revealed pay-out provisions were set to soar to more than £150million, up from £116.4million, after complaints have remained ‘at a high level and for longer than expected’.
This will knock profits by at least £85million.
Amigo revealed pay-out provisions were set to soar to more than £150m, up from £116.4m, after complaints have remained ‘at a high level and for longer than expected’
Amigo provides money to borrowers who have a friend or family member who is willing to guarantee the loan. It will not restart new lending until 2021 due to ongoing ‘uncertainty’.
Amigo has been under investigation by the Financial Conduct Authority (FCA) over whether customers can afford the loans they are taking out.
Gary Jennison, chief executive of Amigo, said fixing the complaints backlog was the group’s ‘number one priority’.
Shares fell 22.2 per cent, or 1.91p, to 6.68p.
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