A large number of companies in the finance and loan business have seen their profits decline drastically over the course of the last year, due to the current economic slowdown and a general lack of funds within the banking and finance sector for companies to be able to offer loans to potential borrowers.

One loan company however, has bucked this trend. Provident Financial, the doorstep lender which offers personal unsecured loans to individuals in the non standard market, who would probably be unable to obtain a loan from traditional sources such as banks, has seen their profits increase to £128.8 million for 2008, an increase of 11.8 per cent over the previous year.

Peter Crook of Provident Financial said “Despite operating in an increasingly underserved market where demand for our product is high, we have deliberately constrained customer growth to levels which are consistent with lending responsibly in the current environment as well as maintaining the appropriate balance between growth, credit quality and collections capacity. We maintain a uniquely close contact with our customers to ensure that we remain in touch with their current circumstances and can respond quickly to any changes.”

Meanwhile, Cattles, the parent company of Welcome Finance, which until recently, operated in the bad credit loan market for secured loans, has delayed announcing its financial results, due to finding accounting errors in its impairment provisions.

Three directors of Welcome Finance have been suspended whilst an inquiry takes place, but Cattles has issued a profits warning and expects its figures to be “substantially lower” than previous years. Welcome Finance had been one of the largest providers of secured loans in the adverse credit sector of the loan market, until it withdrew from offering new loans last year, due to a lack of funding.