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Lloyds Bank sees PPI bill raised by £750m | Lloyds Bank sees PPI bill raised by £750m |
(about 1 hour later) | |
Lloyds Bank says it will set aside another £750m for compensation for mis-sold personal protection insurance (PPI), taking the total to £8bn. | Lloyds Bank says it will set aside another £750m for compensation for mis-sold personal protection insurance (PPI), taking the total to £8bn. |
UK banks have reserved £16bn to compensate customers sold unnecessary or irrelevant insurance, with Lloyds setting aside more than any other. | UK banks have reserved £16bn to compensate customers sold unnecessary or irrelevant insurance, with Lloyds setting aside more than any other. |
The bank, still part-owned by the taxpayer, made the announcement as it reported its third-quarter results. | The bank, still part-owned by the taxpayer, made the announcement as it reported its third-quarter results. |
Shares in Lloyds fell by 3.5% as markets opened. | Shares in Lloyds fell by 3.5% as markets opened. |
Its profits for the nine months to the end of September were £1.69bn. | Its profits for the nine months to the end of September were £1.69bn. |
Chief executive Antonio Horta-Osorio said: "We are well on our way to becoming a better, simpler, low-risk bank, which delivers the products our customers need and the strong performance and sustainable returns our shareholders expect." | Chief executive Antonio Horta-Osorio said: "We are well on our way to becoming a better, simpler, low-risk bank, which delivers the products our customers need and the strong performance and sustainable returns our shareholders expect." |
Dividends | Dividends |
The charge for PPI had an impact on the third-quarter profit figure and helped to leave Lloyds with a loss of £440 million for the three months to the end of September. | The charge for PPI had an impact on the third-quarter profit figure and helped to leave Lloyds with a loss of £440 million for the three months to the end of September. |
The group also put the loss down to a £330m charge against losses incurred selling its German life insurer Heidelberger Leben, to meet tougher regulatory requirements, in August. | The group also put the loss down to a £330m charge against losses incurred selling its German life insurer Heidelberger Leben, to meet tougher regulatory requirements, in August. |
The government sold £3bn of its stake in the bank in September, and still retains more than a third of the company. It offered big investors 6% of Lloyds. | |
US demand for the shares was reportedly high, with stronger than expected interest from institutional investors. | |
Singapore government-owned Temasek also reportedly bought a large amount of the Lloyds shares, around 0.5% of the total. | |
During Lloyds' bailout in 2008, the government bought shares at an average price of 73.6p and injected £20.5bn in total into the bank. | |
TSB | |
The group also announced it was talking to regulators about starting to pay dividends again, for the first time since 2008. | |
The average market price at the time was 61p, so the government booked the difference as a loss and added it to the national debt. | The average market price at the time was 61p, so the government booked the difference as a loss and added it to the national debt. |
Lloyds stopped making a loss earlier this year, with first half-year profits of £2.1bn. | Lloyds stopped making a loss earlier this year, with first half-year profits of £2.1bn. |
It recently revived the TSB brand and has transferred five million accounts to the new bank, which started operating a month ago. | It recently revived the TSB brand and has transferred five million accounts to the new bank, which started operating a month ago. |
The new bank will be sold off next year, as part of a process ordered by the European Commission to provide greater competition. | The new bank will be sold off next year, as part of a process ordered by the European Commission to provide greater competition. |