ao link
0 £0.00
This item was added to your basket
Credit Strategy homepage
LinkedIn
Twitter
Intelligence, Insight and community for responsible professionals in credit

Lloyds and Barclays latest banks facing surge in PPI claims

Both Lloyds Banking Group and Barclays have used their half-year results to warn investors that they face potentially billions of pounds in charges after a final surge in claims relating to payment protection insurance (PPI).

People seeking to make a claim over mis-sold PPI were given a final deadline of August 29 by the Financial Conduct Authority (FCA) meeting.

 

In a statement to the London Stock Exchange, Barclays said it had set aside cumulative provisions of £9.6bn for PPI redress. As at June 30, 2019, the bank said £9.2bn had been claimed, leaving a residual provision of £360m.

 

However, Barclays said it was still processing PPI-related claims, enquiries and information requests but it already expects to increase its provision in its Q3 2019 results by between £1.2bn and £1.6bn.

 

Lloyds, meanwhile, said it faced a bill of £1.2bn-£1.8bn after receiving between 600,000 and 800,000 claims per week in the run-up to the final deadline.

 

By May 31, Lloyds had set aside some £19.5bn to cover PPI claims, although that will have risen in anticipation of the surge in claims.

 

PPI was designed to cover loan repayments if borrowers fell ill or lost their job, but millions of policies were sold to people who did not want or need them, mainly between 1990 and 2010.

The deadline, set by the Financial Conduct Authority (FCA) to seek compensation was August 29, prompting a surge of last-minute claims from consumers.

 

Other UK banks have had similar experiences, with the Royal Bank of Scotland (RBS) revealing in September that it potentially faces a £900m additional charge after last-minute claims.

Please login to continue reading this article.

Not a member?

Become a member

FREE registration. No credit card required

Register now
  • Stay up-to-date with industry news and appointments
  • Hear about events first
  • Read 1 free Premium article per month

Become a premium member

From as little as £3.48 per week

Become Premium
  • All the perks of a standard member plus:
  • Access to the entire Credit Strategy website
  • 12 months subscription to Credit Strategy Magazine
  • 25% discount to all conferences
  • Exclusive access to Premium Member only roundtables
  • 50% off award entry fees

GET THE LATEST INDUSTRY NEWS STRAIGHT TO YOUR INBOX

Credit Strategy
LinkedIn page

Member of

Did you find our website useful?

Thank you for your input

Thank you for your feedback

creditstrategy.co.uk – an online news and information service for the UK’s commercial and consumer credit industry. creditstrategy.co.uk is published by Shard Financial Media Limited, registered in England & Wales as 5481132, Axe & Bottle Court, 70 Newcomen St, London, SE1 1YT. All rights reserved. Credit Strategy is committed to diversity in the workplace. @ Copyright Shard Media Group