Lloyds Banking sees no need to change motor finance provisions yet Proactive uses images sourced from Shutterstock
Lloyds Banking Group PLC (LSE:LLOY) said it “does not currently believe” it will need to make any change to its provisions for the motor finance compensation scheme, following the final guidance issued by the financial watchdog at the start of the week.
The Financial Conduct Authority said on Monday night that millions of motor finance customers should receive larger compensation than its previous guidance in October.
Lloyds issued a statement after carrying out an assessment of the implications and impact of the final rules, but said some things remained uncertaint, including the rate of customer responses, operational costs and whether any litigation ensues.
“The ultimate outcome may also differ dependent upon potential actions by various parties, including legal proceedings and complaints,” the FTSE 100 lender said, adding that it will provide an appropriate update with its first quarter results at the end of this month.
It added that it remains committed to ensuring customers receive appropriate and timely compensation.
The FCA’s final estimate was that an average of £830 compensation would be expected to be paid this year, increased from an expected average £700 per payout when the regulator issued its first calculations last autumn.
The regulator also estimated that 75% of eligible consumers will make a claim, down from 85% in the original consultation.