Banks should be let off the hook for mis-selling payment protection insurance (PPI) even earlier than a proposed claims deadline of 2018, Lloyds Banking Group has said.
The Financial Conduct Authority is consulting on a potential 2018 cut-off for PPI claims, finally drawing a line under a crisis that has lasted almost a decade and cost the industry some £28bn so far.
Lloyds racked up another £500m in PPI provisions in the third quarter, bringing its total bill to £13.9bn – more than twice as much as any other bank. The City dumped the shares, which fell 4 per cent, or 3.4p, to 74p.
Lloyds’ finance director George Culmer said the deadline should be brought forward from 2018. “We think two years is excessive,” he said. “We think that a shorter timebar will actually get people to act more quickly and get receipt of their money more quickly.”
A spokesman for the Robin Hood Tax campaign said Lloyds’ “bill for ripping off its customers has reached epic proportions”.
Stripping out loan losses, Lloyds’ underlying profits of £1.97bn between July and September were shy of City hopes and below the £2.16bn for the same quarter last year. The main source of weakness came from “other income” – down 7 per cent to £1.4bn on weaker insurance business and “tougher trading conditions” in commercial banking.
Separately, Clydesdale and Yorkshire Bank also chalked up another £465m in provisions, of which £390m related to PPI. Its owner, National Australia Bank, plans to float the business next February, selling 25 per cent of the shares on the open market.
