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Non-Standard Finance PLC on Monday reiterated warnings of company-wide insolvency as it continues talks with the UK Financial Conduct Authority. The Wakefield, West Yorkshire-based consumer lending firm said talks with advisors at the UK Financial Conduct Authority are progressing regarding a potential scheme of arrangement. If the scheme is sanctioned, the company intends to proceed with a capital raise to generate funds for the payment of redress under a scheme, as well as to recapitalise the remaining group and enable Everyday Loans to move forward with its growth plan. If the proposed capital raise is unsuccessful, Non-Standard Finance says its balance sheet will remain ‘deeply insolvent.’ ‘In the event that the scheme of arrangement is not sanctioned by the court, or in the event that the subsequent recapitalisation of the business fails, there would then be a very significant likelihood of a group-wide insolvency, most likely administration, resulting in no return for current shareholders and a significantly reduced return for secured lenders,’ it said. Back in September, the company had reported a half-year pretax loss of £36.2 million, widened significantly from £7.5 million a year prior, while warning of potential insolvency. Non-Standard Finance shares were 11% lower at 0.42 pence each in London on Monday morning. Copyright 2023 Alliance News Ltd. All Rights Reserved.
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