The British Banking Association opposed the FSA government ruling that they should be forced to pay back misled customers on PPI with interest. They argued that this was unfair, as the rules had previously been hazy enough to allow them to get away with poor selling practices, and that it wasn't their fault that the rules had been changed later. This battle went on until last year, and in fact the BBA may still try to challenge the case further.
In case you were feeling sorry for the banks, they made 17 billion in profits on PPI from the 90s onwards, more than one third of which was sold in bad faith. This related to many aspects of sales. For one thing, the charges were too high, sometimes amounting to 50% added onto the mortgage, and they were sometimes hidden from customers too. Another issue was the way PPI was forced on customers as part of a protection racket - they had to take it out to get a mortgage. Yet another problem, the most shocking of all in some ways, was that the cover was given to people who couldn't possibly benefit from it, such as people who were already seriously ill, unemployed or retired. Only 15% of all insurance paid it was ever claimed.
The worst bank in this was Lloyds, and as a result they've been hit with the consequences. They had a loss of 3.47 billion in first quarter of 2011, 3.2 of which related to the need to create a PPI repayment provision. The massive scale of the provision caused a 7.7% drop in shares too. They made a 7.21 million profit in first quarter of 2010, and 2.21 billion overall that year, meaning this slump is a major embarrassment.
The Bank of Scotland is the number two in the culprits list - a list that includes all of the major banks in the UK. They're handling around a fifth of PPI claims being made. This meant that in 2011 they went from making a one billion pounds loss, to a two billion pound loss.
Taxpayers gave The Bank of Scotland a forty five billion pound bailout at the height of the financial crisis. Yet even with PPI losses, it handed out bonuses of over seven million pounds to its staff in 2011 alone.
In case you were feeling sorry for the banks, they made 17 billion in profits on PPI from the 90s onwards, more than one third of which was sold in bad faith. This related to many aspects of sales. For one thing, the charges were too high, sometimes amounting to 50% added onto the mortgage, and they were sometimes hidden from customers too. Another issue was the way PPI was forced on customers as part of a protection racket - they had to take it out to get a mortgage. Yet another problem, the most shocking of all in some ways, was that the cover was given to people who couldn't possibly benefit from it, such as people who were already seriously ill, unemployed or retired. Only 15% of all insurance paid it was ever claimed.
The worst bank in this was Lloyds, and as a result they've been hit with the consequences. They had a loss of 3.47 billion in first quarter of 2011, 3.2 of which related to the need to create a PPI repayment provision. The massive scale of the provision caused a 7.7% drop in shares too. They made a 7.21 million profit in first quarter of 2010, and 2.21 billion overall that year, meaning this slump is a major embarrassment.
The Bank of Scotland is the number two in the culprits list - a list that includes all of the major banks in the UK. They're handling around a fifth of PPI claims being made. This meant that in 2011 they went from making a one billion pounds loss, to a two billion pound loss.
Taxpayers gave The Bank of Scotland a forty five billion pound bailout at the height of the financial crisis. Yet even with PPI losses, it handed out bonuses of over seven million pounds to its staff in 2011 alone.
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Put in a HSBC PPI claims if you think you have been missold to and get your money back.
