EFFORTS to find a future for Bournemouth-based lender Amigo have been boosted after the Financial Conduct Authority (FCA) said it did not appear at a court hearing.

The authority had opposed the company’s previous bid to cap compensation in cases of mis-selling.

But the watchdog has said it will not be appearing at a High Court hearing over Amigo's revised “scheme of arrangement”.

The sub-prime lender employs around 200 people at Bournemouth's Commercial Road and has been weighed down by a backlog of mis-selling complaints. 

Shares in Amigo rose 20 per cent to 5.46pence on Monday morning following the news that the FCA would not oppose the proposals.

Amigo announced the authority would “continue to engage closely with Amigo” but did not consider it necessary to appear in court unless requested.

The FCA had also concluded that there had been a "significant improvement in the fairness" of the scheme but reserved the right to intervene "if facts and circumstances change".

The FCA said in a statement: "If the scheme is sanctioned by the court, the FCA has confirmed that the firm could resume lending if it meets certain conditions. These include meeting the threshold conditions and testing of the firm's new lending system being completed to the satisfaction of the FCA.”

Amigo chief executive Gary Jennison said: "We thank the FCA for its confirmation that there has been a significant improvement in the fairness of the schemes compared with Amigo's first Scheme, which was rejected by the court in May 2021.

"There remain significant obstacles to overcome, including the need for a significantly dilutive equity issue, to recapitalise the ongoing business given the requirements of the schemes for the transfer of virtually all existing assets to the redress creditors."