LONDON -British subprime lender Amigo said on Tuesday that its losses increased substantially in the last financial year, as it battles to secure its future after a court rejected a proposed rescue plan from the company in May.
Amigo posted a pre-tax loss of 284 million pounds ($389.76 million) for the year to March 2021, compared to a 38 million pound loss the previous year.
The company’s future has been in the balance since receiving a deluge of customer complaints that it missold them loans in recent years.
A proposal by the company that would have resulted in customer compensation being cut was rejected by London’s High Court, after watchdog the Financial Conduct Authority objected.
Amigo said on Tuesday it was continuing to pursue an alternative scheme of arrangement, and that this provided a realistic alternative to the company’s insolvency.
However, the company disclosed there was a “material uncertainty” around its ability to continue as a going concern.
“The continuation of Amigo as a business is dependent on our successful pursuit of a Scheme, our ability to raise capital in the future to further support new lending, and a satisfactory resolution of the FCA investigation initiated in May 2020,” the company said.
($1 = 0.7287 pounds)