The owner of Aldermore Bank has put the UK challenger bank up for sale after calling the motor finance redress scheme proposed by the Financial Conduct Authority (FCA) “deeply flawed”.

FirstRand, one of South Africa’s largest banks, has a 100% holding in Aldermore after acquiring the FTSE 250 listed group in 2017.

The FCA last month confirmed it would be proceeding with an industry-wide redress scheme for motor finance providers in the UK, following an investigation into historic discretionary commission arrangements (DCAs). The regulator has confirmed that the estimated total bill to firms will be £9.1bn.

Reuters reported that FirstRand had raised its provisions for mis-sold motor loans by £510m, to £750m, in the days after the regulator finalised the total bill.

A company statement from FirstRand said: “Cognisant of protecting shareholder value and ensuring Aldermore’s future success, the group will ⁠work with the Aldermore board and respective regulators to facilitate an orderly ownership transition.”

In Aldermore’s 2025 financial year, the bank delivered a statutory pre-tax profit of £193.5m while dealing with the impact of a £60.6m charge related to the FCA’s motor finance review.

Just last month Aldermore acquired a £465m portfolio of bridging finance loan assets and associated capability from Octane Capital.

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