25 September 2019
Studio Retail Group plc ("SRG" or "the Group")
Update on legacy financial service matters
In line with the broader market, the Group's largest business, Studio, saw the level of PPI information requests ("PIRs") and direct complaints increase very significantly in the days leading up to the 29 August 2019 deadline set by the FCA. This includes a large block of previously unseen claims from the Official Receiver, acting on behalf of bankrupt customers, received in recent weeks. As with other lenders, we are evaluating the validity and quality of these new claims.
Studio sold PPI policies until 2008 and undertook a proactive customer communications process in respect of PPI between 2012-2015, paying out a total of £7.5m in refunds. The level of ongoing PIRs and complaints after that process was low. Subsequently, in March 2017, the FCA issued further guidance in respect of commissions earned on historic PPI sales following the Plevin decision in the Supreme Court. Studio wrote to affected customers following that guidance, although the response and the ongoing level of PIRs remained low until August 2019.
We are currently assessing the likely uphold and payment rates in respect of the recent PIRs and complaints, and expect that the majority of these will be rejected. However, we anticipate that an additional provision of between £6 - 10m will be required in the Group's interim results for the first half of the year, which will be announced in late November. The majority of this is likely to relate to Plevin refunds, rather than mis-sold policies, and includes the cost of reviewing and administering the claims.
Studio Retail Group plc
0161 303 3465
Tulchan Communications LLP
020 7353 4200
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