Lloyds Banking Group is to announce that it intends to “claw back” bonuses from as many as 10 senior bankers because of the £3.2bn losses that the bailed-out bank suffered after the payouts were awarded a year ago.

Between 40% and 50% of the bonus pot is thought to be at risk. Details were still being finalised on Sunday night and the figure could drop as low as 25% – which may not satisfy some critics who will question why any bonuses should be paid out at all after the bank took the losses to cover the misselling of payment protection insurance (PPI).

Among those facing the consequences of the adjustment of the bonus pot caused by the PPI scandal are the former chief executive Eric Daniels and his closest lieutenants, some of whom have left the bank since his departure a year ago.

Lloyds would not comment on Sunday night, but the chairman, Sir Win Bischoff, acknowledged at the bank’s annual meeting in May that a clawback was being considered by the bank.

“The implications on compensation are being considered by the remuneration committee and will be determined by the board in due course,” he told shareholders when asked about the implications of the PPI provision.

In February 2011 Daniels was awarded a £1.45m bonus for his work in 2010 as he announced that the bank had returned to profitability following its controversial rescue of HBOS.

But just weeks after he left, his successor, António Horta-Osório, announced that the bank would need to take the hit for the misselling of PPI, which is intended to keep paying off loans in the event of illness or job loss but often failed to live up to its promises.

Lloyds is not alone in having to take a provision for the misselling of PPI, but it took the biggest hit in the industry, which has collectively been saddled with a bill of more than £6bn.

Among the other Lloyds bankers thought to be facing financial penalties for the losses that the bank will have to report for 2011 are Helen Weir, the former head of the retail banking arm, who was last week named as the new finance director of John Lewis. She received a bonus of £875,000 for 2010.

Others are said to include Tim Tookey – the outgoing finance director, who is due to present the bank’s 2011 losses to the City on Friday – and Truett Tate, the head of corporate banking, who is already facing controversy over a one-year payment he is contractually entitled to when he leaves in May. Tookey was awarded a bonus of £942,000 and Tate more than £1m.

Other members of the senior management team are also expected to receive lower bonuses than they had been expecting through a process that has not been fully tested since the banking crisis, when regulators demanded that bonuses could be “clawed back” in the event that performance turned sour in the future.

The requirement was made after it emerged that thousands of bankers had walked away with multimillion-pound bonuses in 2007, only for their banks to report huge losses the following years.

When Daniels was awarded the bonus – which was 63.3% of his maximum potential payout – in February 2011, it was deferred for three years, which means he has not yet received the money, in the form of shares.

Other banks will also face questions about whether they are able to claw back bonuses for the losses they suffered as a result of PPI provisions, which none of the major players have been able to escape.

Both bailed-out banks, Lloyds and Royal Bank of Scotland, are due to publish their 2011 results this week, and both are expected to be loss-making some three years after the October 2008 crisis. Details of executive pay are usually published up to three weeks later in the annual reports to shareholders.

Lloyds TSB PPI Claim Back

Britain’s economy is about to get a dose of fiscal stimulus equivalent to a tax cut of as much as £10bn over the next few years, economists say.

The unplanned stimulus arises from refunds of payment protection insurance, which have risen sharply each month since August.

Then, banks and brokers that sold PPI to an estimated 16.1m people agreed to abandon legal efforts to overturn an order for restitution.

PPI customers paid premiums totalling £17bn between 2005 and 2010, according to the Financial Services Authority.

For th full article visit the FT web site or visit http://www.ft.com/cms/s/0/ab7e42ee-5288-11e1-ae2c-00144feabdc0.html#axzz1m9raeePK

In the first 6 months of 2011 nearly £500,000 was claimed alone. Customers were sold PPI policies to help protect them if they defaulted on the loan, mortgage, or credit card payments, should they be made redundant or become sick. The insurance was found to be sold to many people who would never be able to actually make a claims.

For many of the customers, the scheme didn’t work, and making a claim was almost impossible. Martin Lewis of Money Saving Expert said at the time the appeal was lost: “As much as £9billion that was wrongly taken from consumers could now be paid back – an economic boost as money from banks’ coffers will move into the pockets of real people.”

With potential billions still unclaimed 2012 looks set to another year where people claim back their PPI.

If you have paid PPI on a credit card or loan to a bank then take our quick test to see if you are due compensation.

Barclays Bank PPI Claim Back

Natwest Bank PPI Claim Back

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Lloyds TSB Bank PPI Claim Back

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If you have any questions please call us on 01522 300456 or use our contact form.

Figures published today show that the banking group, which includes the Lloyds TSB, Halifax, Bank of Scotland and Black Horse brands, pulled in a total of 22,242 complaints in the first half of 2010, compared with 20,190 in the second half of last year.

Lloyds TSB Bank attracted nearly twice as many complaints as the next company in the tables. Barclays Bank came second in the table for the second six months running, with 7,991 complaints, of which 4,797 related to banking and credit and 2,205 to general insurance.
The financial ombudsman upheld 61% of the complaints against Barclays.

The ombudsman service received a total of 84,212 new complaints between 1 January and 30 June, a small increase on the 82,136 cases received in the second half of 2009, and a large proportion of which related to the sale of payment protection insurance. The majority of these complaints, which were included in the figures for general insurance, were upheld, including 96% of general insurance complaints against Black Horse, 95% against Barclays, 93% against Welcome Financial Services and 86% of those against Lloyds TSB

One of the UK’s biggest high street banks has missed a crucial deadline to contact complainants of the £7bn payment protection insurance (PPI) mis-selling scandal.

HSBC who have been behind the Black ball throughout the last 2 years processing claims have  failed to respond to the backlog of complaints made by customers who believe they were mis-sold PPI by August. HSBC state that they will be informing the last of the complainants within the next few days. It is understood that it will take longer to sort out ther mess.

HSBC, which has a PPI liability of £270m, compared with £3.2bn from Lloyds TSB said it expected to inform customers of the amounts they would be paid within a matter of days.

It is understood that the the majority of banks who were given 16 weeks to process claims have achieved their target. It will probably mean that the FSA will impose regulatory fines because of this.

Just another case of a Bank not taking the PPI scandal seriously.

The Financial Services Authority (FSA) today published details of the amount of redress paid by firms during the first six months of 2011 to consumers who have complained about the way they were sold payment protection insurance (PPI).
The data shows that 16 firms, representing 92 per cent* of PPI complaints received in the first half of 2011, have paid a total of £215 million in redress between January and June 2011 inclusive. In May and June alone, following the dismissal of the industry’s legal challenge to the FSA and the Financial Ombudsman Service (the Ombudsman), £102 million was paid out.

The monthly totals, with cumulative totals in brackets, are:

•January – £29 million (£29 million)

•February – £31 million (£60 million)

•March – £28 million (£88 million)

•April – £25 million (£113 million)

•May – £37 million (£150 million)

•June – £65 million (£215 million)

The figures include the value of ex-gratia payments made to complainants and cases settled by the Ombudsman.

The FSA is publishing this data as a simple measure to allow firms, consumers and other interested parties to keep track of the progress being made. The FSA will continue to publish this data on an ongoing monthly basis accompanied by a running total.

The FSA has also created a step by step video guide featuring the FSA’s head of consumer affairs, Chris Pond, explaining the process of how to complain to financial services providers. You can view this video now on our website.

Margaret Cole, interim managing director of the FSA’s conduct business unit, commented:

“The treatment of PPI complainants has left an indelible stain on the financial industry’s record. By releasing these figures we’re providing a useful measure of firms’ progress that can be tracked on an ongoing basis.

“While the amount of redress paid in May and June is unsurprisingly large in the wake of the judicial review, looking ahead we expect the amounts to vary somewhat as firms clear their backlogs while dealing with complaints as well.

“We remain 100 per cent committed to ensuring that where consumers were mis-sold PPI they will receive the appropriate redress from firms, and we are monitoring firms’ progress to ensure this is done properly.  Where we find that this not to be the case, we are not afraid to take tough action.”

Approximately 9.8 million people have credit cards with PPI attached, according to a survey. Of these about 13 per cent (or 1.3 million) thought that buying the PPI was a condition of the sale or that it would boost their chances of receiving the credit card.

 PPI is sold alongside credit cards, loans, finance agreements and mortgages to cover repayments if people are off work because of illness or unemployment.

Obviously, what the banks didn’t say was that most of the time it didn’t cover you. Surprise Surprise

Banks have had to pay out to thousands of customers, including many self-employed people, to whom it mis-sold payment protection insurance (PPI).

Policies, which were sold to the Self Employed, were often sold even though the Banks knew that the customer could not claim on the policy if sick or ill.

The High Street banks which all want the customers trust expect that this debacle will go away. Trust is not selling customers £2000 of Insurance knowing that they could not claim on the policy.

Paying back the customers money should not be enough; this is Fraud and no better or worse then the MP’S expenses claims.

 It’s a big win for these customers as the FSA had decided to act and stop these banks from ripping the customer off.