Amigo shares soar after watchdog says it could resume lending

(Reuters) -Shares in British sub-prime lender Amigo soared as much as 81% on Monday after a financial regulator said the firm could resume lending subject to conditions and if its new business rescue plan was approved by the London High Court.

The conditions include the Financial Conduct Authority (FCA) testing Amigo's new lending system, the British regulator said in a letter to Amigo published to FCA's website.

The firm had halted lending in March 2020 and has been scrambling for survival after a deluge of customer complaints of misselling loans.

The FCA, which had opposed the firm's earlier rescue plan in May, said it would not challenge the new business rescue plan in the court hearing.

The regulator also added the new plan was an improvement on last year's proposal which was rejected by the court for short-selling compensation claimants.

Shares of Amigo are up 63.6% at 4.5 pence per share at 0918 GMT.

(Reporting by Sinchita Mitra in Bengaluru;Editing by Vinay Dwivedi and Krishna Chandra Eluri)