Credit losses in the personal loan market are finally moving back to historical levels, with lender Plenti Group reporting a doubling of realised impairment losses in its latest financial results. Plenti released its annual report for the 12 months to March yesterday, showing a 109 per cent increase in realised impairment losses to A$10.5 million during the year. In addition, expected credit losses rose 96 per cent to $14.2 million. Part of this increase was the result of growth in the Plenti loan book, which increased 36 per cent to $1.77 billion. But the increase also reflected the impact of higher interest rates and inflation, plus the normalisation of conditions as the effect of COVID stimulus washed out of the economy. Realised loan impairment expenses as a percentage of the portfolio rose from 60 basis points in the September half of the financial year to 70 bps in the March half. The company said the loss rate increased further to 90 bps in March and April. Plenti Group chief executive Daniel Foggo said: “Loss rates are going up but we think we are largely through the normalisation phase now.” The highest losses were in Plenti’s personal loan portfolio, with lower loss levels in its automotive and renewables portfolios.  Plenti grew revenue by 62 per cent over the year to $143.4 million. Expenses rose 58 per cent to $139,23 million. The company made a loss of $14.6 million, compared with a loss of $10.7 million the previous year. The company’s preferred measure, cash profit, was up from $496,000 in 2021/22 to $4.5 million in the year to March. To get from statutory profit to cash profit Plenti takes the unusual step of adjusting for the expected credit loss provision. Loan funding costs increased 93 per cent to $61.7 million. The company increased borrowing rates to maintain its margin but NIM fell from 6 per cent in 2021/22 to 5.2 per cent in the year to March. Higher rates had an impact on originations, which grew just 3 per cent to $1.1 billion. Auto loan originations were down year-on-year, while renewable energy and personal loan originations were up.