Motonovo hikes motor finance provision as buyers circle Aldermore
Car finance firm Motonovo has ramped up its provisions for the motor finance scandal as top banks and private equity firms explore a takeover of its parent company Aldermore. The Cardiff-headquartered company recognised a £153.2m charge in its latest accounts for historical motor finance commissions. This was more than double the £60.6m recorded last year. [...]
Motonovo, a car finance firm, has increased provisions linked to the ongoing motor finance scandal as major banks and private equity firms consider a potential takeover of its parent company, Aldermore. In its latest accounts, the company recognized a £153.2 million charge for historical motor finance commissions, a significant increase from the £60.6 million recorded in the previous year.
The provision was split between £147.8 million for customer redress and £5.4 million in operational costs, including legal fees, complaint handling, and scheme preparation.
This increase in provisions led to a substantial loss of £151.6 million for the financial year ending June 2026, more than six times higher than the £24.6 million loss in the previous year. Aldermore's parent company, Firstrand, confirmed it was putting the firm up for sale in April due to frustrations with the Financial Conduct Authority's car finance redress scheme. However, Motonovo asserts that the Supreme Court's ruling does not establish a broad precedent for other courts.
Despite the motor finance tensions, interest in Aldermore has increased, with Nationwide, Investec, Lloyds, and Warburg Pincus showing interest. Motonovo's net loans grew by 10% to £4.5 billion, while new lending increased by 20% to £2.4 billion. However, operating income fell by 9% to £155.5 million, primarily due to a contraction in the net interest margin, which reduced to 3.55% from 4.29%.
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