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Banks’ bill for missold PPI hits over £20bn

High street banks have set aside a further £1.5bn to compensate customers missold payment protection insurance, taking their total PPI redress bill to over £20bn.

According to Sky News, Barclays, Lloyds Banking Group and Royal Bank of Scotland will announce their extra PPI provisions in their half-year results next week.

To date, Lloyds, Barclays and RBS have set aside a total of £16.85bn to cover missold PPI. HSBC has also set aside £2.1bn. Including the latest £1.5bn,the total cost of redress for missold PPI among the biggest four lenders is £20.45bn.

The extra redress from the three banks has beeen triggered more PPI claims relating to policies sold before 2005. The British Bankers’ Association is holding talks with the FCA over introducing a deadline for consumers to bring PPI complaints.

Yesterday, figures from the Financial Ombudsmen Service revealed PPI complaints fell 57 per cent over the past year, from 132,152 to 56,869. The proportion of complaints upheld also fell from 78 per cent to 61 per cent.

In June, a BBC investigation found that Lloyds Banking Group, Barclays, MBNA and Capital One may have underpaid compensation over PPI misselling to the tune of £1bn.

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  1. A veritable feeding frenzy for the CMC’s, though if they [the banks] failed properly to establish suitability and keep proper records, it’s easy to see why. The crazy thing is that many people are being compensated for having been mis-sold policies not just that WERE actually suitable, but on which they’ve even claimed successfully. Is this good regulation? How can it possibly be good regulation? Why is the regulator being allowed to get away with having FAILED to identify and put a stop to what was obviously a mushrooming problem that became an epidemic? The reason, of course, is that no independent body exists to hold it properly account for anything, so the regulator gets away with everything.

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