UK Banking Industry Still In Deep Water With Increased Fines and Penalties for PPI, Other Scandals

April 29, 2015
by admin in PPI News

UK banks are still in hot water despite reports of PPI claims significantly dropping in number in the Financial Ombudsman Service. Standard & Poor’s predict that UK banks will pay out 5 billion from 2015 to 2017.

The credit rating agency said that banks have paid out £42 billion in total for mis sold PPI, LIBOR bank benchmark scandals and forex rigging.

Due to the high number of banking scandals in the United Kingdom, the city watchdog had considered to have senior banking officials charged with reckless actions if they cannot provide evidence that they had exhausted all means to prevent possible financial scandals.

Lloyds is expected to pay out £500 million in the second quarter of 2015. Its share price lost 0.57 per cent with 78.65p on April 27, 2015.

Deutsche Bank analysts noted that Lloyds will pay out £1 billion in total for 2015 alone.

S&P specifically said PPI mis selling still remain as one of the three main categories of the conduct and litigation charges. However, they believe the worst time for PPI mis selling and recompense has already passed.

In total, the UK mis sold PPI bill is now at £26 billion. Lloyds accounts for half of the total compensation bill at £12 billion. Meanwhile, Clydesdale has incurred the largest penalty for PPI handling with £24.9 million for editing relevant consumer information regarding payment protection insurance