In revealing almost £70m in additional costs between them, the two banks were the first to make further preparations to compensate UK consumers involved in ‘the biggest mis-selling scandal in financial services history’.
Despite some predictions that they would decline, PPI complaints are in fact at a three-year high and with less than 18 months to go until the claims deadline complaints are expected to rise furthermore.
Figures from the industry regulator the Financial Conduct Authority (FCA) show the most recent monthly compensation totals were the highest for 19 months at £398m.
It was the fourth consecutive monthly increase, the biggest since April 2016 and the biggest November on record for 5 years.
As well as the FCA’s public awareness campaign, which featured an Arnold Schwarzenegger impersonator, there is also a new reason why PPI compensation may be due which has contributed to the increase in complaint numbers.
Thanks to new rules brought in by the FCA in August now just having PPI could mean consumers are due money back based on undisclosed high levels of commission.
Offers of compensation in these cases can be less than those seen in mis-selling complaints, however here at The Fair Trade Practice we have still seen commission-based redress amount to more than £30,000*.
Other lenders were expected to follow suit when announcing their own annual results in the following weeks with analysts predicting that Lloyds, already the worst offenders in the mis-selling scandal, would increase their provision by as much as £450m.
Despite more than £29bn being paid out so far almost £15bn worth of lender provisions are still yet to be claimed. The FCA themselves recently estimated that 4 in 5 potential complaints about PPI were yet to be made.
*Offer received January 2018