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Lloyds sets aside £225m for investment and protection advice

Lloyds Banking Group has set aside £225m for “legacy sales” of investment and protection products and sales incentive schemes.

The bank’s interim results for the first half of 2014, published today, show it has set aside an additional £225m for liabilities in this area, taking total provisions to £525m.

Lloyds says the provision relates to a “limited number of matters” affecting the retail division, including “potential remediation in relation to legacy sales of investment and protection products and historic systems and controls governing legacy incentive schemes”.

Of the £525m set aside, £117m had been used as of 30 June.

The bank has also made a further £50m provision for interest rate hedging products redress, taking total provisions to £580m.

In December, the FCA fined Lloyds £28m over “serious failings” related to its sales incentives schemes.

The investigation focused on advised sales of investment and protection products between January 2010 and March 2012, and found incentive schemes put staff under pressure to hit targets or avoid demotion rather than focusing on customers’ needs.

Lloyds reported a pre-tax profit of £863m for the first half of 2014, down 58 per cent from £2.1bn last year.

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  1. They must have a big folder at Lloyds HQ entitled FFU -Further Foul Ups – you may adjust the middle word for something you feel more appropriate, its clearly a well thumbed file and rarely closed. Medical report for Lloyds reads ..continues to haemmorhage uncontrollably from self inflicted injuries allegedly from pre 2009 but more likely to have been ongoing and probably still occuring. They’ve specially linked 2 words in the English Dictionary as a consequence…. Perpetual Misdemeanours under which it says simply See Lloyds. Get all of your bad news out on one day then you only have to lift the carpet once and give the market a shovel full of “spin”.

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