Cattles shock alert sparks a stampede out of shares

They fell from 13¼p to 6¾p, valuing the company at just £31 million.

The latest in a series of disappointments from the subprime lender came when it said it would not be able to publish its full-year results next Thursday as it had planned.

In a curt statement to the Stock Exchange, Cattles announced this was "pending completion of a review of the adequacy of its impairment provisions".

It went on to warn: "Although it is not possible to determine the outcome of the review at this stage, it is expected to result in profit before tax being substantially lower than current market expectations."

Analysts said there were now fears over the survival of the company, which last month abandoned its bid to get a banking licence, and has £500 million of bank facilities that fall due in July, with a further £153 due in December.

"We think the company is over," said one analyst. If they can't get the re-financing they need in July, they're going to end up owned by the banks."

The fact the group is reviewing the amount of its writedowns on bad debts, and the way it makes them, suggests that the trading situation has deteriorated sharply as its consumer borrowers struggle to pay off their debts.

It could also point to a conflict between the company and its auditors PricewaterhouseCoopers over whether or not the firm's accounting methods are adequate in the current climate.

Quoted companies normally expect to have their final results signed off by their auditor at least a week before they are published.

Cattles raised £200 million of new capital from shareholders last April at a rights-issue price of 128p. Those who took up their rights - and 97% of its shareholders did - have now lost 96% of their investment. Chief executive David Postings said at the end of January: "Demand for our products remains strong, and the group continues to trade profitably and in line with expectations."

That was just after he announced the axing of 1000 jobs in an attempt to keep the business profitable.

Cattles, which trades largely as Welcome Finance, typically lends around £2000 a time to its customers, who generally have poor credit records. It is also big in the second-hand car finance market.

Postings has recently argued that the company should be helped by the Government as part of its financial bailout package.

He contacted MPs, saying the firm already had a vital role supplying finance to people who had been shunned by High Street banks.