Vanquis Banking Group (VANQ) Q3 2024 TU earnings summary

Executive summary

• Turnaround strategy progressing, with financial guidance unchanged for the year.

• Gross customer interest-earning balances remained stable in Q3 2024.

• Positive performance in Second Charge Mortgages, now exceeding £100m in balances.

• Underlying credit quality stable; customers show strong financial resilience.

• Gateway technology transformation and cost-saving initiatives on track.

Financial highlights

• Gross customer interest-earning balances stable at £2,254m compared to previous quarter.

• Net receivables grew 4% to £2,083m, driven by lower impairment allowance and mortgage growth.

• Year-to-date net interest margin (NIM) decreased 0.2% to 18.6%, reflecting a shift to lower-margin mortgages.

• Tier 1 ratio declined from 19.8% to 18.7%, mainly due to statutory loss and higher risk-weighted exposures.

• Retail funding rose to 88.7% of all funding as deposits surpassed £2.1bn.

Outlook and guidance

• On track to deliver £60m gross cost savings by year-end 2024, with further reductions planned for 2025 and 2026.

• Financial guidance for the year remains unchanged.

• Gateway technology transformation expected to complete by mid-2026.