OneSavings Bank flags £28.6m fraud by corporate customer
OneSavings Bank has delayed its results after discovering potential fraud by one of its corporate customers.
In a late statement on Wednesday the buy-to-let lender, which was scheduled to publish results this week, said it had recently become aware of possible fraud but maintains it is likely an “isolated incident”.
The maximum possible loss could be £28.6m although OSB said it had been “secured against lease receivables and the underlying hard assets”.
Shares in OSB are down more than four per cent this afternoon.
“Until the investigation has progressed sufficiently we will not know to what extent the receivable has been impaired, with a maximum potential credit loss of £28.6m as at 31 December 2020,” it said.
It has appointed Smith & Williamson to carry out the probe.
“While I am disappointed at the very recent discovery of a potential fraud at one of the non-bank lenders we provided secured funding to, we believe that this is an isolated incident anda re commited to expediting our investigation and publishing our full preliminary results on 8 April 2021,” chief executive Andy Golding said.
Excluding the impairment, OSB said underlying profit before tax is expected to fall from £381.1m to £366.2m. Its credit losses for the full year were broadly flat and it plans to pay out a dividend.
“Whilst we remain cognisant of the ongoing uncertainty over the true impact of the pandemic when government support comes to an end, the foundations of our business remain extremely robust,” Golding said.