H&T Group PLC Update on regulatory review into HCST lending (0372H)
April 04 2022 - 2:00AM
UK Regulatory
TIDMHAT
RNS Number : 0372H
H&T Group PLC
04 April 2022
H&T Group plc
("H&T" or "the Group" or "the Company")
Update in respect of regulatory review into high-cost short term
lending
H&T Group plc announced on 18 November 2019 that it was
working closely with the Financial Conduct Authority (FCA) to
undertake via a skilled person, a review of the lending processes,
credit worthiness and affordability assessments within its
unsecured high-cost short term (HCST) loans business between April
2014 and October 2019 ("the review").
A methodology for conducting the required past book review was
developed in close collaboration with the skilled person. Following
an initial review by the FCA, "outcomes testing" was undertaken by
the skilled person. After further review by the FCA and subsequent
development of the methodology, the FCA has confirmed that H&T
may now proceed to implementation of the past book review and the
resulting customer redress arrangements.
Following application of the review methodology, it is
considered that a total of c.9,800 HCST loans to c.8,000 customers
should not have been granted. This represents 11.5% of HCST loans
and 12.6 % of HCST customers during the period. Redress will be
paid in respect of these loans in accordance with the methodology,
including statutory interest up to 31 March 2022, taking account of
any withholding tax.
In total, the cost of the redress will amount to GBP2.1m, of
which GBP1.6m will be paid directly to customers and GBP0.5m will
be by way of an adjustment to the balance of current outstanding
loans. On average, eligible customers will receive redress
amounting to GBP264.
Customers who are eligible to receive redress either in the form
of cash or balance adjustment will be contacted directly, beginning
in April 2022. The process is expected to be completed within 12
months.
A provision of GBP2.1m was raised in the Group's financial
statements for the year ending 31 December 2021, to cover the cost
of this redress. In addition, it is anticipated that professional,
operational and implementation costs relating to the review and the
redress programme will amount to approximately GBP0.6m. This has
been fully provided for in previous accounting periods.
Chris Gillespie, chief executive of H&T said:
"The Board of H&T is very aware of the concerns and
uncertainly that this review has caused for all stakeholders. We
are pleased that the review is now concluded and that the majority
of HCST loans granted by H&T are considered to have been lent
responsibly.
"Customers whose loan should not have been granted and who are
due redress, will be contacted directly and we will endeavour to
complete the redress programme as quickly as we can, so as not to
prolong the uncertainty further.
"H&T is committed to providing services which maintain the
highest standards of customer care and regulatory compliance, and
we have co-operated fully and constructively with the FCA
throughout this review. High cost short term unsecured lending no
longer forms part of the Group's product offering."
END
Enquiries:
H&T Group plc
Tel: 020 8225 2797
Chris Gillespie, Chief Executive
Diane Giddy, Chief Financial Officer
Shore Capital Ltd (Nominated Adviser and Broker)
Tel: 020 7408 4090
Stephane Auton/ Iain Sexton (Corporate Advisory)
Guy Wiehahn/ Chloë Booker-Triolo (Corporate Broking)
Haggie Partners (Public Relations)
Tel: 020 7562 4444
Damian Beeley
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