Subprime lender NSF in talks for equity raise; sees loan book steadying by Q4
Adds details on company performance, background
July 15 (Reuters) - Non-Standard Finance NSF.L said on Wednesday that talks with investors for a potential equity raise have been encouraging, as the subprime lender tries to shore up its balance sheet to soften the blow from the coronavirus pandemic.
The company, which last month highlighted risks to its ability to continue as a going concern amid the coronavirus outbreak, said its overall loan book would likely stabilise during the fourth quarter of 2020.
"In June 2020, overall basic collections (before settlements) were at 89% of the average level in January and February 2020 with a particularly strong performance in home credit," the company said in a trading update.
The subprime lender added that it remained cautious on lending despite encouraging signs on the volumes front over the past two months.
In June last year, Non-Standard Finance abandoned a bid for rival Provident Financial PFG.L and reported a pretax loss of 76 million pounds ($96.02 million) for the year ended Dec. 31, partly due to costs relating to the failed takeover.
NSF shares pared some losses after the announcement, but were still down 7% at 4.2 pence by 1252 GMT.
($1 = 0.7915 pounds)
(Reporting by Aby Jose Koilparambil in Bengaluru; Editing by Shounak Dasgupta and Anil D'Silva)
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