UK

Nearly 1.4m Payment Protection Complaints sent To Lloyds Banking Group

26/02/2013 19:24 GMT

Nearly 1.4 million complaints were made to Lloyds Banking Group during 2012 about payment protection insurance (PPI), figures released on Tuesday showed.

However, Lloyds said that it made "significant progress" in driving complaint numbers down in the second half of last year, when PPI complaints fell back from a peak.

lloyds banking group fined for ppi delays

Lloyds was fined £4.3 million earlier this month by the City watchdog

The group dealt with just over half a million PPI complaints for the whole of 2011 but this figure rocketed in the first half of 2012 to more than 727,000.

Lloyds' latest six-monthly complaints figures, which were published today, showed that PPI complaints fell back by 9% in the second half of last year, with 658,289 cases recorded.

PPI still makes up the lion's share of complaints dealt with by the group, although the recent fall helped to drive an overall drop in complaints towards the end of the year.

A total of 762,024 complaints was recorded in the second half of 2012, marking an 11% drop compared with the first six months.

Banking complaints, which are also included in this figure, were down by a quarter compared with the first six months of 2012, with 71,258 cases recorded during the second half of the year.

Investments was the only category to see an increase in complaints, although there was a sharp 23% rise compared with the previous six months, with 6,829 complaints recorded in the last half of 2012.

Lloyds was fined £4.3 million earlier this month by the City watchdog after up to 140,000 customers had their PPI compensation payments delayed.

The Financial Services Authority (FSA) said the group's PPI redress systems had fallen "way below" expected standards.

The failings related to a period leading up to spring 2012 and Lloyds previously said that it had been surprised by the volume of complaints it had needed to process and it has worked to clean up its act, leaving no-one permanently out of pocket.

PPI complaints have surged across the industry and some analysts have predicted the eventual total bill for mis-selling could reach about £25 billion.

Lloyds said that the latest figures show it now receives an average of 1.1 banking-related complaints per 1,000 accounts, compared with 2.1 complaints per 1,000 accounts two years ago.

It aims to drive the complaints rate down further to reach one complaint for every 1,000 accounts by the end of the year.

In terms of the individual brands within the group, Halifax had 0.9 complaints for every 1,000 accounts in the second half of 2012, Lloyds TSB had one complaint per 1,000 and Bank of Scotland had a higher complaints rate at 1.3 complaints per 1,000 accounts.

Group customer service director Martin Dodd said: "We're pleased that our significant progress on customer complaints continued throughout 2012.

"Over the last three years, the number of banking complaints we receive has dropped considerably."

Along with other banks, Lloyds regularly reports its complaints data to the FSA, which publishes figures for the industry.

Which? executive director Richard Lloyd said: "All the major banks have a lot of work to do to make it as straightforward as possible for customers with a legitimate PPI claim to get their money back.

"To win back badly damaged consumer trust, they should make realistic provisions for PPI claims, publish updates on how much they've paid back, and claw back bonuses from executives who presided over the mis-selling."