March 4, 2020 / 11:04 AM / a month ago

UPDATE 1-British lender Amigo's founder resigns from board amid ongoing sale process

(Adds detail, background)

March 4 (Reuters) - British subprime lender Amigo said on Wednesday its founder and biggest investor, James Benamor, who put up the company for sale in January, has resigned from the board, months after he made a boardroom comeback.

Benamor in December returned as a non-executive director at Amigo, a move that was followed by the exit of Amigo’s Chief Executive Officer Hamish Paton and Chairman Stephan Wilcke.

Amigo, which issues loans typically guaranteed by borrowers’ family or friends, said it will go ahead with a strategic review and formal sale process, despite the resignation of Benamor, who was looking to find a new owner for his 60.6% stake.

Shares of the company were down 2% at 38 pence as of 1045 GMT.

The lender has been hit in recent times by a tough economic outlook and regulatory pressures, coming under scrutiny from the Financial Conduct Authority last year on concerns that some of its clients would be caught in a loan trap on high interest rates.

Last month, Amigo said it had received indication of interest from several parties and entered into non-disclosure agreements with them, though there was no certainty an offer would be made.

Benamor established Amigo Loans in 2005 and was appointed as a non-executive director in 2016. He stepped down from the role in September 2018.

Reporting by Yadarisa Shabong in Bengaluru; Editing by Shinjini Ganguli

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