Lloyds Bank has topped up its payment protection insurance (PPI) payout fund by another £1 billion, taking the total amount it alone has allocated for remediating customers who were mis-sold the frequently useless policies to a staggering £17 billion.
Its latest trading update, published today, shows that the bank has had to top up its payout fund as a result of an expected deadline for PPI claims coming into force by the end of June 2019. As a result of this deadline, Lloyds expects more people who were inappropriately sold PPI policies to come forward in the interim.
Its report states “A provision of £1 billion was taken in the period for PPI to cover further operating costs and redress, including impact of proposed June 2019 deadline,” adding that the bank has also put aside £150 million to cover other “conduct issues, including £100 million in respect of packaged bank accounts”.
To date, Lloyds’ PPI provisions have been enough to give £250 to every single man, woman, and child in the country, but even the latest figures may not be enough. Today’s top up follows a £2.1 billion injection to Lloyds’ PPI provisions in February 2016.
Total PPI redress paid out across the industry totals £25 billion, according to the latest Financial Conduct Authority data, which covers the period from January 2011 to July 2016.
At the time of writing, Lloyds’ shares were trading 0.5% lower than at the start of the day, at around 55p. Its share price has barely changed since the Government dropped plans to sell its remaining stake in the bank at a discount to the public at the start of October.