Lloyds Makes Loss After PPI Dent
It has been revealed that Lloyds Banking Group have made a loss of £3.85 billion for the first nine months of the year after having to put funds in place to pay for the Payment Protection Insurance (PPI) scandal. The bank, in which the British Government owns 41 per cent, took the hit because missold PPI had to be compensated for.
After the misselling scandal broke earlier this year, financial institutions across Britain had to make provisions for offering customers repayments and additional compensation packages. Lloyds Banking Group set aside £3.2 billion for this, resulting in the bank making a significant loss for the first three quarters of 2011 as they saw profits slump by 30 per cent when compared against the same period in 2010.
With less demand for loans, third quarter profit plummeting by 25 per cent to £644 million, and wholesale funding costs on the increase, Lloyds has noted considerable problems this year. High stress levels have also removed chief executive of Lloyds, Antonia Horta-Osorio, from action due to illness, and the bank is now in a turbulent state as it tries to stop its dwindling income.
However, whilst profit figures are shown to be down at Lloyds, consumers should continue with plans to regain lost money due to having been missold PPI products. Moreover, for those who have taken out a credit agreement with Lloyds in the past decade, looking at insurance could highlight discrepancies for which compensation could be significant.