Cattles warns of tougher trading

CATTLES, the money lender that targets poorer borrowers, warned this morning that tougher trading conditions are unlikely to let up anytime soon.

Business became more difficult between April and June, as a string of interest rate rises and higher energy costs have left Britons with less cash in their pockets.

The gloomy comments sent Cattles shares 7¾p lower to 309p in early trading, despite reassurances that there were no signs that bad debts are on the up.

Cattles told investors: 'We remain cautious in the selection of our customers and we retain strong control over credit quality and operational efficiencies. Our customers' arrears levels and bad debts remain stable.'

The High Street's biggest banks ? Barclays, Lloyds, HSBC, HBOS-owned Halifax and Royal Bank of Scotland's NatWest, have all warned recently that more customers are missing repayments.Cattles also confirmed that new accounting rules would have slashed last year's profits by more than a quarter.

The £2bn-a-year doorstep loans industry is under investigation by competition watchdogs after consumer groups accused lenders of ripping off customers.

Cattles, owner of Dial4ALoan, has an army of part-time agents collecting payments door-to-door on loans of up to £250. Chief executive Sean Mahon recently said he would like to half the group's exposure to doorstep lending within five years. It currently accounts for 11% of the group's profits.

Cattles has also been touted as a possible takeover target for bigger rival, Provident Financial.