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.