Lloyds Banking Group takes fresh £350m PPI scandal charge

(c) Sky News 2017: <a href="http://news.sky.com/story/lloyds-banking-group-takes-fresh-163350m-ppi-scandal-charge-10796984">Lloyds Banking Group takes fresh £350m PPI scandal charge</a>
 

Lloyds Banking Group has announced a further charge to account for the payment protection insurance (PPI) mis-selling scandal.

News of the £350m writedown - contained in a regulatory filing - was a surprise as it had said in October that a fresh £1bn it was setting aside then aimed to draw a line under mounting bills.

It has been most exposed to costs related to the loan insurance product because it was the market leader.

The latest provision takes its own total, to date, to £17.35bn - comprising about half the sum set aside by the UK's financial services industry.

Costs include not only compensation for those mis-sold PPI but also other things like extra staff to investigate claims.

Lloyds said the new money, which it would recognise in its first quarter results, would also cover a rise in both the number of claims and the size of compensation payouts, following the Plevin ruling - a Supreme Court judgment on PPI complaints handling.

"The additional provision has been taken to reflect the estimated impact of the policy statement including the revised arrangements for Plevin cases, which includes a requirement to pro-actively contact customers who have previously had their complaints defended," the banks said.

PPI remains the most complained-about financial product in the UK but claims have been slowing in recent times.

Figures from the Financial Ombudsman Service showed there were 78,000 PPI complaints in the last six months of 2016.

Earlier this month, the City regulator confirmed a 29 August 2019 deadline for PPI claims. The Financial Conduct Authority said it hoped such a move would prompt those yet to register a complaint into action sooner rather than later.

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