U.K.’s Provident Sinks on Consumer Loan Probe, Redress Plan

Shares in Provident Financial Plc tumbled Monday after the subprime lender said the U.K.’s market watchdog had opened an enforcement probe into its consumer credit arm.

The Financial Conduct Authority is focusing on whether Provident’s door-to-door loans were affordable and sustainable over the past year, according to a trading update Monday. The shares fell as much as 30.8%, the most in more than three years.

Provident also said it was proposing to set aside 65 million pounds ($91 million) to settle the growing number of claims it lent to borrowers who were not credit-worthy. However, the firm said it could ...