- Vanquis Banking Group 20
- 05 November 2025 08:41:12
Source: Sharecast
Vanquis said gross customer interest earning balances had grown 8% in the third quarter and 18% year-on-year to £2.65bn, with credit card balances increasing for the second consecutive quarter, reflecting further card utilisation by existing customers and growth in customer numbers to over 1.3m, offsetting a decline in vehicle finance balances, in line with expectations. Second charge mortgage balances continued to grow "at a steady monthly rate", reaching roughly £480m at the end of September.
The London-listed firm stated net receivables increased 8% in the quarter and 21% year-on-year to £2.51bn, reflecting growth in interest-earning balances, lower impairment coverage required on lower-risk second charge mortgages, and "robust credit performance" in credit cards and vehicle finance.
Year-to-date net interest margins reduced 40 basis points quarter-on-quarter and 170bps year-on-year to 17.0%, reflecting a lower yield on second charge mortgages and growth in 0% balance transfer and promotional credit card products, partially offset by improved yield in vehicle finance and a lower cost of funds.
Vanquis added that its CET1 capital ratio reduced by 110bps in the quarter to 17.4%, reflecting the deployment of capital to support growth.
Looking ahead, Vanquis continued to guide to a "low single-digit" statutory return on tangible quity for FY25, while FY25 gross customer interest-earning balances were now expected to be more than £2.7bn, up from previous guidance of no less than £2.6bn, reflecting "deliberate additional volume growth" in lower-risk, but lower-margin second charge mortgages.
Chief executive Ian McLaughlin said: "In the third quarter of 2025, we continued to build scale, with gross customer interest-earning balances up 8% in the quarter and 18% year-on-year. Product margins remained resilient and profitable.
"The group therefore delivered a statutory profit in the third quarter and across the nine months to 30 September, reflecting sustained operational momentum. We remain on track to achieve a low single-digit statutory Return on Tangible Equity for the full year, consistent with previous guidance."
As of 0840 GMT, Vanquis shares were down 0.77% at 112.33p.
Reporting by Iain Gilbert at Sharecast.com