NSF says needs to raise capital as COVID-19 curbs pressure lending
Adds background, details from statement
Feb 23 (Reuters) - Non-Standard Finance NSF.L needs to raise new capital to stave off future covenant breaches and to address uncertainties about its going concern status, the London-listed subprime lender said on Tuesday, as extended COVID-19 lockdowns hit lending volumes.
Net loan book at 2020-end was down by a third compared to 2019.
The tiered lockdowns reduced lending volumes in November and December after a strong pick-up in volume during August, September and October with new cash issued running at 10 million pounds per month that stabilised the loan book, NSF said.
The company last October posted a pretax loss for the six-month period and said it would re-engage with major investors about an equity raise.
The company then also said its largest shareholder, Alchemy, was supportive of a substantial equity issue.
However, NSF said it expected demand to jump as the economy opens up, adding "there may also be opportunities to take advantage of some competitors contracting their business in this sector."
(Reporting by Muvija M in Bengaluru; Editing by Sriraj Kalluvila)
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