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More mis-selling misery for Lloyds

Monday, February 03, 2014 - 01:38

Feb.2 - Shares in Lloyds Banking Group fall after it takes another mis-selling hit and says it's unlikely to start paying dividends again until the second half of the year. Ciara Sutton reports.

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1.8 billion pounds - the latest provision from Lloyds banking group for the mis-selling of payment protection insurance. It brings the total to nearly 10 billion pounds. The payback from the selling of unnecessary products has dogged UK banks for several years. This latest bill comes just two weeks before Lloyds announces its full year results. It puts paid to the bank's plans to start paying dividends again later this year. That sent shares down almost 3% But Chris Hughes from Reuters Breakingviews says Lloyds's long term prospects look bright. (SOUNDBITE) (English) REUTERS BREAKINGVIEWS EDITOR, CHRIS HUGHES, SAYING: "You've got a strong UK economy coming through. UK banks are a good way to get exposed to that. But when you look around, a lot of banks have got problems. Barclays has got big strategic issues, Royal Bank keeps coming up with bad news. Lloyds came out with some bad news today on mis-selling, but the strategy and the market position it's got, are very very credible, very convincing. And you can see that looking further into the future, you can have more faith that you know where Lloyds is going to be two or three years than its peers." Lloyds was partly bailed out by the taxpayer in 2008. It still hopes to take the next step back to full privatisation by holding a second public sale of its government-owned shares . The first one last September raised over 3 billion pounds and marked a milestone in Britain's recovery from the crisis. The scandal has hampered that process - some estimates put the total cost from mis-selling at 18 billion pounds.

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More mis-selling misery for Lloyds

Monday, February 03, 2014 - 01:38