Britain’s lenders have added a staggering £4.9 billion to their PPI compensation pots AFTER the claims deadline on August 29th.
The latest to announce extra cash for paying successful PPI claims is the Co-operative Bank. The self-styled ‘customer-led ethical bank driven by co operative values’ has added £75 million, bringing its overall total to £600 million.
Surge in claims
The bank says it made the decision after receiving a massive surge in claims in the weeks leading up to the claims deadline.
It is the same reason given by six other financial institutions who have admitted being caught out by the huge numbers of consumers making last minute claims for potentially mis-sold policies.
The deadline was set by the Financial Conduct Authority (FCA) to draw a line under what has become Britain’s biggest ever financial scandal which has already seen more than £36 billion paid by the industry since January 2011.
But experts believe the total may now exceed £53 billion once all successful claims have been paid out. However, because of the sheer number of new claims banks have been left to investigate, it could be Spring 2020 before the final bill can be calculated.
New pledges of cash made since the deadline are:
- Lloyds Banking Group (LBG) – £1.8 billion
- Barclays – £1.6 billion
- Royal Bank Of Scotland (RBS) £900 million
- CYGB (Clydesdale Yorkshire) – £450 million
- Co-op Bank – £75 million
- Nationwide – £50 million
- N Brown (0nline/catalogues) – £30 million
The LBG addition takes its overall compensation pot to £22 billion – almost half of the industry total – while Barclays have now earmarked £11.3 billion.
State-owned RBS has set aside £6.4 billion and CYBG has made provision of £3.67 billion.
The Co-op Bank’s total compensation pot is now over £600 million and Nationwide has a total of £490 million.
Fashion retailing catalogues
N Brown is the firm behind fashion retailing outlets like Jacamo, Simply Be and JD Williams.
They had already set aside £108 million to pay successful claims, but felt the surge of new claims experienced in the lead up to the deadline needed another £30 million to make sure there was enough in the pot to make any required payments.
A spokesman said that in the last few weeks before the deadline it had received 10 times more claims than its average with 40,000 arriving in the last week.