UPDATE 1-Lender IPF evaluating alternative business models for Slovakia
(Adds details, analyst comments; updates shares)
Dec 22 (Reuters) - International Personal Finance Plc (IPF) said it was evaluating alternative business models for Slovakia after the country amended its consumer legislation, which was expected to hit the lender's business there.
The amendments include clarification that the existing cap of 27 percent per annum applies to all costs linked with a loan, including the fee for home service.
IPF, which provides small personal loans in eastern Europe and Mexico, had warned this month that it expected a hit to its Slovak business from the proposed consumer legislation amendments.
The lender might have to close its Slovak home credit operations, Shore Capital analyst Gary Greenwood wrote in a note on Tuesday.
"We expect that the existing home credit model will be rendered economically unviable and understand that management is not confident that it can directly mitigate the impact..." Greenwood wrote.
IPF's Slovakia business had pretax profit of about 6 million pounds ($9 million) in the 12 months ended June 30, the company said on Dec. 10.
This accounts for 5-6 percent of IPF's overall pretax profit, Greenwood said.
New credit laws in Poland, which will come into effect in March 2016, are also expected to hit the company.
IPF shares were down 1.5 percent at 288.7 pence at 1145 GMT on the London Stock Exchange. ($1 = 0.67 pounds) (Reporting by Noor Zainab Hussain and Mamidipudi Soumithri in Bengaluru; Editing by Sunil Nair and Kirti Pandey)
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