Egg awaits debt improvement

Internet bank Egg warned today it was taking longer for the impact of tighter lending rules to filter through into its figures for bad debt.

Egg said changes to lending criteria in December had resulted in an improved trend, but that a small increase in credit card defaults would still leave the current quarter below the expectations of the company in the summer.

Chief executive Paul Gratton described the overall market as “highly competitive” but said Egg had put in a solid performance with profits from the core UK business up by £4m (€5.9m) in the third quarter to £17.9m (€26.4m).

The figures were released on the day that Prudential said it intended to keep hold of its 79% stake in the company, and possibly buy the rest.

Mr Gratton added: “We have been participating in Prudential’s ongoing strategic review and we are looking forward to working more closely together.”

Egg employs around 2,500 people, mainly in Derby, England.