The chances that the payment protection insurance scandal will exceed £30 billion rose yesterday after Santander took a fresh £450 million provision to pay compensation.
Santander UK’s bill for the mis-selling fiasco now stands at £1.52 billion. The latest provision dragged down its profits for last year by 4 per cent to £1.3 billion, but the bank said that it hoped the latest sum would be sufficient to cover all remaining costs.
Santander’s provision came as Royal Bank of Scotland also announced an extra writedown for PPI, of £500 million. Others are expected to follow when they announce full-year results next month, with Lloyds Banking Group — the largest provider of PPI — likely to set aside the biggest amount.
Banks are taking extra provisions