Share Prices & Company Research

Market News

25 Jan 2021 | 09:33

Amigo warns on insolvency if payout plan fails

(Sharecast News) - Amigo said it would be insolvent if a proposed cap on customer payouts fails as the subprime lender published details of its plan. The company has written to customers and the financial ombudsman with details of a scheme of arrangement that would limit payments to customers and the ombudsman.

Creditors will be asked to vote for the plan at a meeting on 30 March. If the scheme fails there will be no money for creditors whereas under the plan creditors will get a share of £15-£35m plus a share of Amigo's profit over the next four years, it said.

Amigo lends to people with bad credit histories if someone guarantees repayment of the loan. The company has been in a state of crisis for more than a year after a regulatory clampdown and a torrent of compensation claims threatened its viability.

"If the scheme fails, Amigo will likely go into insolvency and based on its calculations no compensation would be paid to customers," Amigo said.

Amigo shares fell more than 10% in early trading and were down 4.6% to 8.02p at 10:22 GMT. The shares peaked at almost £3 in December 2018 and the company was briefly a member of the FTSE 250 index.
Get in touch today
Join Redmayne Bentley
Talk to us now about opening a new account or transferring your account from another provider
0113 243 6941
Get in touch today
Contact your local office
Contact your local office to find out more
The value of your investments and the income from them may go down as well as up, and you could get back less than you invested.
Continuing our Personal Service: View our Latest COVID-19 Update: 30th April 2021
We use cookies on this site to improve your experience and help us provide you with a better website. An explanation of the cookies we use and their purpose can be found within our Cookie Policy. Your continued use of this site means you consent to the use of cookies.