Barclays PPI claims 16% up in 2017

Claims for mis-sold PPI against Barclays Bank soared by 16% in 2017.

Total claims received have now topped 2.1 million – 300,000 up on the previous year – and the bank has paid out a total of £7.6 billion in compensation for successful PPI claims.

Compensation

But unlike HSBC and Lloyds Banking Group (LBG), Barclays has not added any more cash to their PPI compensation pot.

Both HSBC and LBG made multi-million £ additions to their funds in their figures announced earlier this week, but Barclays believe the £700 million added in July last year will be enough to see them through to the claims deadline in 2019.

Successful claims

It has set aside a total of £9.2 billion to pay out successful claims, of which £8.4 billion has already been spent.

Now a statement in their annual report says they believe the remaining £1.6 billion will be enough to see them through to the PPI claims deadline of August 29th 2019.

Estimate

However, in common with other high street banks, they point out that their figures are only estimates based on the increased number of claims they have already experienced since the announcement of the deadline.

The report says: “However, it is possible the eventual outcome may differ from the current estimate. We will continue to review the adequacy of provision level in respect of the future impacts.”

Their future analysis shows they expect to receive another 570,000 claims of which they expect to uphold 87%.  However, they expect the average payout per claim to drop slightly from £2,036 to £1,989.

Profits

Overall the bank reported a 10% rise in pre-tax profits, but also acknowledged some serious problems both on-going and in the future which could have an impact on the balance sheet.

It is currently being sued by the US Department of Justice over allegations of the mis-selling of mortgage-back securities between 2005 and 2007 and the Serious Fraud Office have just charged it with ‘unlawful financial assistance’ relating to a multi-billion deal with Qatar in 2008.

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