S&U (SUS) Trading Update summary

Market environment and regulatory impact

• Challenging UK financial services environment, with regulatory scrutiny and a Court of Appeal decision imposing a new retrospective duty of care on lenders and brokers, impacting sector growth and confidence.

• Consumer and business confidence at four-year lows following a poorly received government budget, curtailing growth ambitions.

Financial performance and divisional highlights

• Group net receivables stable at £449m, with Advantage Motor Finance down 10% to £295m, offset by Aspen Bridging's strong growth.

• Advantage advances fell 33% year-on-year, with profit before tax at about half last year's level due to lower receivables and repayments.

• Aspen Bridging advances rose 23% to £148m, net receivables up 30% to £154m, and profit before tax up 50% year-on-year.

Operational and regulatory developments

• FCA lifted the 'VREQ' constraint on Advantage, but repayment rates remain below last year at 86% versus 91%.

• Ongoing regulatory uncertainty, especially regarding commission payments, has led to opportunistic claims by CMCs, though new CMC charging rules may deter spurious claims.

• Constructive discussions with the FCA continue as the s166 investigation nears completion, with hopes for greater regulatory clarity.