Provident says credit card unit's performance slightly above expectations

(Reuters) - Subprime lender Provident Financial PFG.L said on Wednesday its credit card business Vanquis Bank, which has been a driver of profit, performed modestly above expectations in the fourth quarter, partly due to tight cost control.

The company, which provides credit to people who do not meet the lending criteria of mainstream banks, has been growing its customer numbers since fending off smaller rival Non-Standard Finance’s takeover bid last year. NSF, on the other hand, has struggled with costs relating to the failed attempt.

London-listed Provident said its consumer credit division (CCD) also delivered results in line with its plans, helping it forecast 2019 that matched market expectations.

CCD, the company’s home credits business, suffered a botched reorganisation in 2017 that had led to the departure of its chief executive officer and forced a profit warning.

Provident said its car and van financing arm, Moneybarn, failed to match its internal targets due to higher impairment charges.

The lender added that Royal Bank of Scotland's RBS.L investment bank, NatWest Markets, had agreed to provide Moneybarn with $100 million in initial funding that is expected to grow to 275 million pounds over the next 18 months.

Reporting by Muvija M in Bengaluru; Editing by Shailesh Kuber