Lloyds Banking Group is set to strip directors of more than £1m in bonuses over their role in the misselling of payment protection insurance.
Former Lloyds chief executive Eric Daniels will lose at least £360,000 of his 2010 bonus, while a number of other directors are each set to lose around £250,000, according to reports.
The Telegraph says the move marks the first time a UK bank has exercised a “clawback” option on executive pay since the financial crisis began.
Banks have been forced to set aside almost £6bn in provisions for the misselling of PPI after losing a High Court case to stop customers demanding compensation last April. Lloyds set aside £3.2bn for payouts.
Others set to lose out include outgoing finance director Tim Tookey, who will forgo £235,000 of his £942,000 bonus and former head of the retail bank Helen Weir, who will lose £218,000 of her £875,000 bonus.
Lloyds results are due this week although The Telegraph suggests the move may be inserted as a clause in the banks’ annual report next month. The bank is able to claw back the bonuses, which are made in shares, because the award was released over three years, so future payments will now not be made.