LONDON, July 16 Reuters Vanquis Banking Group on Tuesday warned investors it did not expect to meet its goal to deliver a low singledigit return on tangible equity for its full year, as it tackles an indepth balance sheet review and challenging trading.

Chief Executive Ian McLaughlin said the comprehensive review of the lender39;s finances had led to the revaluation of some historic balances.

A review of Vanquis39; vehicle finance receivables resulted in an approximate downward revaluation of stage 3 balances and charged off assets by around 29 million pounds, the bank said.

While finding these oneoff items is disappointing, it does mean that our financial position is now clearer and more stable, McLaughlin said in a statement.

While the group will remain well above its regulatory capital requirements, it expects to end the year below its target range of 19.520.5 for Tier One capital that was set by its board on March 27.

The lender, which specialises in offering finance to customers who typically struggle to borrow from mainstream banks, said trading performance began to recover towards the end of its fiscal first half, reflecting progress with group39;s business transformation strategy.

New customer volumes for the first half of the year described as ahead of plan and net interest income was stable compared to the same period a year ago, although gross customer interestearning balances ended the halfyear 6 below the level on Dec. 31.

Reporting By Sinead Cruise;…