Banks should set aside more funds as PPI complaints double

Which? is calling on the banks to ensure they set aside more funding to pay back customers who were mis-sold Payment Protection Insurance (PPI), as complaints continue to rocket and the £10 billion set aside by the banks could run out within months.

The number of new PPI claims more than doubled to 2.2 million in the first half of 2012, a 129% increase on the previous six months, according to new complaints data from the Financial Services Authority (FSA) published today.

New Which? analysis suggests that if PPI payouts continue at the same pace as the first half of this year, Lloyds could run out of provisions by November 2012, Barclays by December 2012, RBS within the next six months, and HSBC by August next year.

As the full extent of the PPI scandal continues to unfold, Which? is calling on the banks to ensure they set aside sufficient funds to make sure customers who were mis-sold PPI are properly compensated and ensure they are making it as easy as possible for customers to claim back the money they are owed.

Which? also wants to see the banks publish monthly updates so there is full transparency about the amounts that have been paid back. Banks should also claw back bonuses from senior executives who presided over the mis-selling scandal to help fund the new provisions.

Which? chief executive officer Peter Vicary-Smith said:

“With well over two million PPI complaints being made in just six months, PPI is now the biggest financial scandal of all time. The banks must set aside more money for PPI claims and make it easier for customers to get back what they are rightly owed, without any hassle.

“Consumers are continually being short-changed by the banks. We’re campaigning for Big Change in the culture of banking to put customers first, not bankers and protect the public suffering from further mis-selling and scandals.”

Which? has launched a major new campaign ‘Big Change’ to put consumers’ best interests at the heart of banking reforms. The public can support the campaign by signing the ‘Big Change’ pledge here.

‘Big Change’ is calling for:

  • Bankers to put customers first, not sales.
  • Bankers to meet professional standards and comply with a code of conduct.
  • Bankers to be punished for mis-selling and bad practice.



Notes to editors:

Amount major banks have paid back for mis-selling PPI

Bank Amount paid out between 1 January 201230 June 2012 (£ million) Total amount paid out to 30 June 2012 (£ million)
Lloyds Banking Group £1,910 £2,995
Barclays £459 £737
RBS £417 £894
HSBC £291 £463


Estimated date of when current provisions could run out

Bank Amount of provision left as at 30 June 2012.
(£ million)
Estimated month when current provision could run out if payout rates continue at the same pace as during 1 January 201230 June 2012
Lloyds banking Group £1,320 November 2012
Barclays £406 December 2012
RBS £588 March 2013
HSBC £653 August 2013


1. Figures were estimated using statements made by management where specific figures were not published. The data was collated from:

1.1 Lloyds 2011 Annual Results, page 34. Lloyds Q1 Management Statement, Q&A transcript, Page 7, Management say that £1.8 billion was paid out at the end of Q1

1.2 Barclays, 2011 Annual results, page 29, Q1 Interim Management Statement Transcript – answer to question 1.

1.3 RBS, Interim results, on  page 97,

1.4 HSBC 2012 interim results, HSBC Q1 Management Statement. All HSBC figures were converted from USD to GBP on 25 September 2012.

2. Source for number of PPI claims: FSA complaints data September 2012 

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