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S&U PLC on Tuesday said it expects momentum to build in the second half of 2025, predicting the recent motor finance ruling will add ‘confidence and stability’ to markets. The Solihull, England-based lender focused on motor finance and property bridging said the expected ‘resurgence’ in profitability is beginning to materialise and is expected to gain momentum in the second half of the year. In a trading update covering June 18 to the end of July, S&U said recent favourable trends have ‘continued and even accelerated’. It noted this has been accompanied by external events, ‘most notably’ the Supreme Court decision on motor finance commissions, which will ‘add confidence and stability to the markets we serve and therefore attract investment into them.’ Earlier this month, the Supreme Court partially overturned judgments that said controversial car loans were unlawful, but did uphold one case, which allows the claimant to seek compensation on different grounds. The decision mostly overturned judgments made by the Court of Appeal last year that ruled it was unlawful for car dealers to receive a commission on loans without sufficiently informing borrowers. At the time, shares in motor finance providers jumped on the news. On Tuesday, shares in S&U traded 0.3% higher at 1,880.00 pence each in London. They have risen 8.4% in the last month and are up 2.2% in the last 12 months. S&U said while the Supreme Court ruling has now provided greater legal certainty, the Financial Conduct Authority’s position will be ‘tested’ by their proposed redress scheme. But S&U added its motor finance business, Advantage, is in the ‘fortunate position of avoiding any redress on [discretionary commission arrangement]-related deals, which it never offered.’ S&U said the environment in which Advantage operates has improved, noting the government’s emphasis on a regulatory regime for financial services which encourages growth appears, ‘albeit at an early stage, to have had an effect.’ ‘If persisted in, this will provide the consistency and certainty for which we have long called and will attract capital investment into motor finance thus sharpening competition and benefiting customers,’ the firm added. Away from motor finance, S&U said its property bridging company, Aspen, has continued its excellent progress. After a ‘dull’ June, S&U said it is ‘very encouraging’ to see Aspen end July with record advances at £28.6 million, and at £106.4 million for the half year, up 15% year-on-year. Aspen’s credit quality and collections were even stronger as evidenced by record collections for the half year of £108.6 million, 49% higher on-year, with a record £28.3 million collected in July whilst the number of late payers was below budget at half year. S&U Chair Anthony Coombs said: ‘The skies are now brighter for a return to steady sustainable growth than at any time since the pandemic. The difficult regulatory and economic conditions of the past two years have served to prove the resilience of our businesses. Of course, challenges will always remain, but the S&U corporate tanker is undoubtedly turning.’ Copyright 2025 Alliance News Ltd. All Rights Reserved.
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