An influx of PPI claims prior to the final deadline imposed by the Financial Conduct Authority (FCA) saw Lloyds pay out £2.5bn to customers, its annual report for 2019 shows.
The payout saw the bank’s pre-tax profits fall 26 percent to £4.4bn, but Lloyds said no further provision was needed as it had already set aside enough to cover the bill. The total Lloyds has paid out for PPI claims now stands at £21.9bn.
"The group’s statutory performance was impacted by a substantial PPI charge related to the deadline for claims submission,” chief executive António Horta-Osório said. "Historic conduct issues remain disappointing, but we continue to be focused on doing the right thing for our customers."
In the run-up to the complaints deadline, Lloyds said it had received about five million new claims but only about 10 percent of those resulted in a compensation payment.
Overall, Lloyds had £4.1bn of retail lending in forbearance in the year to December 31, 2019, £23.bn of which was between one and 30 days past due and £1.8bn of which was more than 30 days overdue.
The bulk of both groups was made up of secured loans, with £1.8bn of secure loans between one and 30 days past due and £1.6bn past 30 days.
Around £282m of unsecured was under 30 days overdue, while £97m had exceeded the 30-day mark. Some £135m of motor finance loans were between one and 30 days past due, while £32m of car finance was more than 30 days overdue. Around £80m of other loans were between one and 30 days overdue, and £78m was more than 30 days past due.