Barclays has set aside an extra £1bn to cover any redress due to customers who were missold financial products.
Of the £1bn set aside, £400m has been set aside to cover the cost of misselling interest-rate swaps to small and medium-sized business, bringing its total provision for misselling claims against these products to £850m. The bank says it has used £36m of the £850m to settle claims as at 31 December 2012.
The bank has also set aside a further £600m for payment protection insurance redress, as a result of “a higher than anticipated response rate to pro-active mailings in Q4”. In total, Barclays has set aside £2.6bn to settle misselling claims relating to PPI products, of which £1.6bn had been paid to customers as at the end of 2012.
The extra £1bn set aside today means Barclays has now earmarked just over £3.4bn to cover the costs of missold financial products.
In a note published on the London Stock Exchange this morning, Barclays said it will continue to monitor claims volumes for both products and that provision levels will “be kept under ongoing review”.
The bank will publish its full-year results later this month containing the additional provisions.