Lloyds Banking Group (LBG) have blamed the cost of paying thousands of clients for the mis-selling offor reporting pre-tax losses of £570 million.
Britain’s biggest retail bank, which is 41% owned by the taxpayer, announced it has set aside another £1.5 billion for PPI compensation, plus a further £400 million for compensation on interest rate swaps.
LBG has the greatest exposure to the PPI mis-selling scandal with the bill now topping £6.8 billion – almost half of the total set aside by the whole UK banking industry – despite recent denials by former Lloyds TSB chief executive Eric Daniels that there was widespread mis-selling of PPI by the bank. He claimed the majority of cases were caused by ‘a misunderstanding between the industry and the regulator.’
Current chief executive Antonio Horta-Osorio has claimed that many of the PPI claims made to the bank ‘are without merit’ and that up to a quarter of them proved to be false. However, figures released by the Financial Ombudsman Service have shown that at one point last year they had upheld 98% of cases which had previously been rejected by the bank.
Mr Horta-Osorio is one of the chief beneficiaries of the bank’s bonus scheme this year after being awarded £1.5 million in deferred shares on top of his £1 million salary. The overall bonus pool has been reduced by 3%, but still tops £360 million.
LBG is understood to have taken soundings from the Government to ensure it would not face immediate opposition from ministers, but the award is bound to add fuel to the controversy over bankers’ bonuses after LBG was recently fined £4.3 million by the Financial Services Association for delays in payments to their customers who had successfully complained about mis-sold PPI policies.
Have you been mis-sold PPI?
Experts have claimed that many people who have been mis-soldinsurance are either not aware they have it or are unsure whether it was of any use to them.
Gladstone Brookes are experts in recovering PPI which has been mis-sold to our clients. We have recovered over £300 million so far, including over £9.2 million in January 2013 alone.
If you want to reclaim PPI you believe you may have been mis-sold on any loans, mortgages or credit cards via Gladstone Brookes it could not be simpler. Just fill in on the claim form on this website or call our FreePhone claims line on 08000 461 826.