Vanquis Banking Group (LSE:VANQ) fell 5.6% to 112p after a first-quarter update saying it delivered a statutory profit to 31 March and remains on track to deliver a low double‑digit statutory Return on Tangible Equity for 2026.
The UK credit card and consumer finance group grew gross customer interest‑earning balances 4% in the quarter and 27% year‑on‑year to £2,932m, with net receivables up 4% to £2,802m.
Net interest margin fell 50 basis points sequentially and 220 basis points year‑on‑year to 15.6%, driven by a portfolio mix shift towards lower‑yield second charge mortgages and growth in 0% balance transfer and promotional card products, with FY26 NIM guidance around c.15.5%.
Risk‑adjusted margin was stable at 9.4% and the CET1 capital ratio reduced 60 basis points to 15.9% reflecting capital deployment for growth partially offset by quarter profits.
Management said Gateway, the group’s technology modernisation programme, remains on course for completion in 2026, has migrated over 800k customers to the new mobile app and is expected to deliver £23m–£28m of savings across 2026 and 2027.
Credit Card customers increased to 1.37m and active Snoop users rose 7% year‑on‑year to 344k including 44k Vanquis customers, while vehicle finance balances are expected to reduce in the first half ahead of Gateway onboarding.
Vanquis said it is only exposed to Scheme 2 of the FCA motor finance compensation schemes, has 4,338 agreements above the scheme thresholds and has recognised a provision of £3m which remains unchanged.
"We remain on track to deliver a low double‑digit statutory Return on Tangible Equity for the full year," Ian McLaughlin, Chief Executive Officer, said.
