Lloyds Q3 profit up, but takes another PPI hit

Lloyds said it took a £750m charge for the mis-selling of payment protection insurance (PPI) in the third quarter, meaning it has now set aside more than £8bn for the scandal, far more than any other bank.

It said PPI complaint volumes were declining at a slower than expected rate and the response to its letters to customers offering compensation where appropriate had been higher than forecast.

The PPI charge hit its statutory profit. Underlying profits at Lloyds, which is 33 per cent owned by the UK taxpayer, were £1.52bn in the third quarter, up from £831m the year before and in line with the average forecast according to a poll of analysts.

“The outlook for the UK economy now looks more positive and the group’s business model is well matched to the economic environment,” the bank said in a statement.

The interest margin is the difference between the interest rate paid to savers and the interest rate charged to borrowers.

LLoyds is a major employer in Yorkshire.