Lloyds Bank takes another £1bn hit from PPI scandal


Pre-tax profits at the lender slumped 15pc to £811m in the three months to the end of September after it took a further provision to account for the extension of the PPI claims deadline to June 2019. Lloyds is the bank that has been most affected by the scandal and has now set aside more than £17m in total to handle its fall-out, reports The Telegraph.

The bank, which is still 9pc owned by the taxpayer, also confirmed that the market volatility from the Brexit vote had hammered its pension schemes. While Lloyds’ defined benefit plans had a £430m surplus at the end of June, the schemes have now slumped to a £740m net deficit.

Worries that the pension could hit its capital position proved unfounded, however. The lender’s core tier one capital ratio edged up to 13.4pc from 13 per cent at the end of the first-half despite the deficit.

Boss Antonio Horta-Osorio said Lloyds had put in a “robust performance” during the first nine months of 2016.

“The group’s transformation and successful execution of strategy, along with its competitive advantages in costs and risk, also position it well to achieve our goal of becoming the best bank for customers and shareholders,” he said.

Lloyds’ shares fell 3 per cent in early trade to 53.84p.