AGM Statement/Trading Update

Provident Financial PLC
16 May 2007

Provident Financial plc

AGM Statement and Trading Update

16 May 2007



John van Kuffeler, Chairman of Provident Financial plc, made the following
statement at today's Annual General Meeting.



UK home credit

UK home credit has made a positive start to 2007, with continued year-on-year
growth in both customer numbers and receivables.  Impairment levels remain
stable despite pressures on customers' disposable incomes, due to the benefits
of tight credit management and improvements to the arrears processes introduced
during 2006.



Vanquis Bank

Vanquis Bank has generated further growth in customer numbers and receivables
which, when combined with the re-pricing of credit lines undertaken towards the
end of 2006 and tight credit management, are yielding the anticipated benefits.
We continue to expect that the business will trade at around breakeven for 2007
as a whole.



International

The International home credit division has made a strong start to 2007 across
all markets.



In Central Europe, Poland is performing well. The strong improvement in credit
quality seen during the latter part of 2006 has continued, and the investment in
expanding the agent force during the last quarter of 2006 has resulted in a
return to customer growth during the last three months.



In Mexico, the main focus has been to improve the quality of the business before
re-commencing the branch network expansion.  Nonetheless, customer numbers have
expanded strongly from the existing infrastructure.  It is also pleasing to
report that across the Puebla region we are seeing an improved collections
performance, aided by stronger controls over new credit issued and significantly
improved staff retention which is now at Central European levels.  Guadalajara,
the second region under development, continues to perform well.  We continue to
expect Mexico to move to profitability in 2009.



The Romanian pilot continues to perform satisfactorily and plans for a national
roll-out are being developed.



Motor insurance

As announced on 9 May, the company has agreed the sale of Provident Insurance
for a consideration of approximately £170m, which will give rise to an
exceptional gain of approximately £70m, with completion expected in June once
the necessary regulatory clearances have been obtained.




Group outlook and demerger

The good start to 2007 and improved trading outlook for both the UK and
International businesses provides a strong platform for the proposed demerger of
the International business.



As previously reported, full details of the demerger, including the intended
capital structures of the UK and International businesses following the
demerger, will be included in the Circular and Prospectus.  We anticipate that
these documents will be published very shortly after the completion of the sale
of Provident Insurance which, as noted above, is expected in June.



Enquiries:



Media
David Stevenson                        01274 731111

Investor Relations
Stuart Caldwell                        01274 731111




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