Lloyds provisions for PPI compensation top £13bn
- Credit: PA
State-backed Lloyds Banking Group’s provision for payment protection insurance mis-selling has topped £13billion after it yesterday took another £1.4billion hit over the scandal.
Lloyds expects complaints to start to tail off but warned that if they did not it would have to add an extra £3bn to the sum by the end of next year.
The PPI provision announced yesterday was part of a total £1.8bn set aside for conduct issues as the lender continues to be haunted by past misdeeds.
This overshadowed an improved half-year performance which saw Lloyds’ pre-tax profits rise 38% to £1.19bn despite the conduct hit and a £660million charge related to the sale of its stake in TSB to its new owner, Spain’s Banco de Sabadell.
Chief executive Antonio Horta-Osorio said the addition of a further PPI provision was “disappointing” but that the bank was able to take the action “from a position of financial and capital strength”.
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PPI complaints against Lloyds have fallen less than expected and the total set aside by the bank in relation to the scandal has now reached £13.4bn, of which £2.2bn has yet to be spent.
The total includes more than £2bn in administrative costs, with 7,000 staff employed to process complaints. Lloyds has also had to go back over cases it previously rejected following fresh complaints.
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