Lloyds Banking Group set aside more than £1b in 2015’s third quarter to cover for payouts to consumers who were mis-sold PPI. Despite a huge drop in profits, it had gained another billion from lending to smaller businesses and personal financing.
Lloyds said it has a huge number of risks and uncertainties still unsorted. Investors have expressed disappointment over the high-street bank’s poor performance with shares falling around 4.5% by the end of October.
Meanwhile, Lloyds boss Antonio Horta-Osorio said Lloyds is making “strong progress towards becoming the best bank for customers and shareholders while delivering resilient financial performance and further strengthening our market lending capital ratios.”
A Simpler Model
Horta-Osorio said it was all thanks to Lloyds’ simpler approach that is “low-risk” and “UK-Focused”. Its 6pc boost in underlying profit in the first three quarters is stupendous but is not enough to appease disappointed investors.
The Lloyds CEO said the banks’ performance places it in a strong position to recover in a growing economy. Analysts said Lloyds’ profits can suffer from a gloomy global economy.
Lloyds Finance Director Chief George Culmer said it was due to PPI’s delayed deadline. He said the FCA’s decision to end PPI claims by 2018 is “far too long” and said a shorter deadline would do better for consumers.
“We think two years is excessive. We think that a shorter time bar will actually get people to act more quickly and get receipt of their money more quickly,” he said.