28th October 2015
Lloyds Banking Group has posted pre-tax profits of £958m for the three months to September, up 28% from £751m a year earlier.
But the bank set aside a further £500m for payment protection insurance (PPI) redress, bringing its total spend to £13.9bn and with profits below analysts’ predictions its shares fell by more than 4% in morning trade.
Underlying profit was down to £1.97bn from £2.16bn a year ago.
The Financial Conduct Authority (FCA) says it will impose a 2018 deadline for people to claim compensation for mis-sold PPI, but Lloyds says the date should be moved forward. Finance director George Culmer says: ”It’s our view that two years is excessive.”.
The bank also added £100m to a fund it has set aside for other compensation claims by customers, taking the total to £535m for the year to date. It is being used to compensate customers who were mis-sold packaged bank accounts and to cover a £117m fine for mis-handling PPI complaints.
The government is planning to sell £2bn of shares in the bank early next year. with the general public offered a 5% discount.
Priority will be given to those buying less than £1,000 and a bonus share for every ten purchased will be offered to all those who keep their shares for at least a year.
The government has already cut its stake from 43% down to 12% and the share sale will see this reduced further.