PCF Group is set to withdraw from the UK’s banking market after the lender’s attempts to raise fresh capital and seek other options failed.
PCF told investors on Wednesday it will not recommence lending and, while it would continue to explore ‘strategic transactions with bona fide interested third parties’, it will now set about managing down its loan and savings portfolio positions and look to reduce its cost base.
The FTSE AIM All-Share group, which intends to issue notice to cancel its listing, had been set to be acquired by Castle Trust Capital in May, but the suitor ultimately opted to withdraw its offer in September.
PCF Group was granted a banking licence in 2016
Castle Trust’s initial approach for PCF, which ‘at some stage’ will ‘sell all or parts’ of its loan portfolio, came in the wake of the lender’s shares being suspended after its chief executive of 13 years suddenly resigned ahead of a review of its ‘financial controls and reporting processes’.
PCF shares fell by more than 40 per cent last week upon news it would seek to raise growth capital and explore ‘transactional options’.
The group said regulators and its key shareholder Somers had been informed of its plans.
Chief executive of PCF Bank Garry Stran said: ‘This has been a very difficult strategic decision for the Board to make given the consequences for the business, colleagues, customers, intermediaries and shareholders.
‘This is particularly so given the considerable progress made over the last 18 months to remediate the issues that gave rise to the suspension in trading in the Group’s shares in May 2021 and the work undertaken in seeking to raise growth funding or progress other transactional strategies to deliver a growing and sustainable value proposition for all our stakeholders.’
PCF Bank was established in 1994, focused on vehicle financing, SME asset finance and property finance.
According to its website, PCF received authorisation to operate as a bank in December in 2016, ‘supported by more than 25 years of solid growth, both organic and through acquisition’.
It claims to have had a finance portfolio worth over £350million and 20,000 customers.
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