Neil Woodford, one of the UK’s most high-profile fund managers, has defended his investment in Provident Financial Group, despite nursing a £300m-plus loss after shares in the sub-prime lender plummeted by as much as 73% on Tuesday.

Bradford-based Provident Financial this morning delivered its second profit warning in three months and advised shareholders that losses could grow to between £80m and £120m this year. It has scrapped its interim dividend payment and said a full-year dividend is also likely to be cancelled.