HSBC reported 14% fall in their profits after pronouncing £269m payment protection insurance compensation.

The bank, which remained unwaivered despite last week’s slowly diminishing BBA support, has finally backed down and agreed to put aside £285m to repay customers who were mis sold ppi. According to Chief executive Stuart Gulliver, it went along with the decision after seeing a thin chance of winning the appeal.

Gulliver went on to explain HSBC’s provision, being the lowest among the big banks, by stating that it had stopped selling PPI in 2007.

Weak trading in Europe and the US as well as rising costs also affected HSBC pre-tax income which plummeted to £3bn upto March 2011.   the quarter and towards the end of the month. not to mention its shares rolled downhill 11.2 percent at 640.5 percent.

Discussions about disposals and s crackdown on HSBC’s cost base are some of the topics to be reviewed.  There are even possible reports of staff cutting and branch closures.

The bank’s cost ratio rose to 60.9% in the latest quarter however this included the PPI provision and other one-off items.  Gulliver warned that it may take two to three years to sort out efficiency problems of the bank.

The banks sold payment protection insurance alongside loans and other borrowings to boost their profits.  However, many of the customers who were mis sold ppi were not eligible to make a claim on the policy rendering it worthless.  The £269m HSBC have set aside to repay customers who were miss sold is only provisional and the actual cost of could be a lot higher depending on the number of customers who come forward to reclaim ppi.

The British Bankers’ Association has discontinued their fight against the Financial Services Authority in trying to over turn new rules on handling PPI claims.

It is reported that high street banks total funds of redress well up to £9 billion.

Chief Financial Ombudsman Natalie Ceeney has encouraged people who feel they may have been mis sold PPI to file a complaint “Consumers should come to us at the ombudsman if they’re unsure about what to do next. Meanwhile we will be working with the banks, over the coming weeks, to ensure that consumers’ complaints are dealt with fairly and promptly.”

Peter Vicary Smith, Chief Executive of Consumer Group Which? also declared this a victory for the consumer after a decade of mis selling PPI and poor handling of PPI complaints. He added that by bringing up the case, the BBA made a huge mistake and as a result, it had lost the consumer’s confidence – which is why banks have decided to give up the fight in their interest to gain back the trust of their consumers.

Peter Vicary Smith further stated that there could still be huge numbers of people who were tricked to buying PPI without knowing they are eligible for a claim.

It is a known fact that Payment Protection Insurance, or PPI, was sold as an insurance that would cover the customers borrowings in the event of accident, illness, or redundancy.  However, this cleverly designed policy was deliberately sold millions of customers who were not eligible for cover.

After Lloyds Banking Group made a £3.2bn provision, Barclays has set aside £1bn for its compensation and RBS added £850m on top of the £200m it had paid out; HSBC followed with £269m.

While top banks were attempting to change the policies on PPI, one mortgage lender did not join the BBA’s challenge. This was the Nationwide Building Society, one of the leading mortgage lenders in the country. The lawsuit ongoing; it had continued processing new PPI complaints, and currently possessed a reputable record of dealing them; It ranked 102 out of 106 of firms having less than 650 complaints, according to Financial Ombudsman Services (FOS) complaints league table for the second half of 2010. Reports say it only had to pay £10m in compensation.

Last month’s court decision has pushed banks to review past sales to see if customers are eligible to reclaim PPI, and to contact customers who were mis sold PPI and invite them to make a claim.

Moves to resolve the mis sold PPI claims issue have started to take shape as top banks like Lloyds Banking Group are outsourcing firms to deal with PPI claims. High street banks Barclays, RBS, Lloyds, and HSBC are estimating costs of more than £5bn to cover refunds and staffing. Banks estimate that they may recruit up to 6,000 workers to tackle millions of complaints from consumers who were mis-sold PPI.

The location to house the host of workers banks is now being settled to accommodate the hoard of customer complaints. The banks did not reveal the necessary requirements for the recruitment, but their primary task is to contact customers who are eligible for a payout.

PPI was often sold without its holder’s knowledge.  The insurance was supposed to cover loans in the event that their holders can no longer pay for due to redundancy or illness. Often, customers found that they were mis-sold and were ineligible to claims on the policy when the need arose.

Lloyds Banking Group, the first of the banking body to bail out on the BBA’s lawsuit last week, announced a £3.2bn provision for its customers. The bank partnered with Huntswood to employ 500 extra staff, the number of employees needed could go up by 1000 or more while complaints are processed, a source says.

Lloyds Spokesman stated that they are keen to move quickly in order to bring out resolution for their customers.

Banking staff in the risk of redundancy might be reassigned to complaints handling; as others use outsourcing companies like Huntswood and Capita to help fill in the needed employees in the least time possible.

The event recalls of a similar situation involving another policy mis sold endowment to temporarily house staff in back-up locations to process paperwork.

However, Mark Hoban commented that FSA should have been the one to start actions regarding PPI to control operations and prevent the future occurrence of PPI as well as stop banks from operating their interests since complaint handlers are regulated by the banks, and not directly by the FSA. Questions about the capabilities of these call handlers also rose even before operations have started.

Lloyds is affected after its take over of HBOS; since Halifax also owes its customers refunds from mis sold PPI.

Lloyds has begun contacting its massive Halifax customers; named “project Kestrel” that started in years 2008 and 2009.

Banks declined to give a statement as to how long they plan to handle PPI complaints, however speculation of the handling will last until the end of the year.

Banks have already set their PPI provisions: Lloyds at £3.2 billion, Barclays & RBS £1bn, and HSBC £280m.

The British Bankers Association (BBA) has decided to abandon its legal challenge against the handling of ppi complaints following the news that Lloyds Banking Group and Barclays Plc had agreed provisions with the FSA to repay mis sold ppi.

Lloyds was the first to break ranks on 6^th May 2011 after they agreed, with the FSA, to set aside £3.2b to repay victims of mis sold ppi.  Barclays soon followed suit and confirmed this morning that they have agreed an £1b provision with the FSA, leaving only HSBC and the Royal Bank of Scotland to decide on whether or not to appeal Justice Ousley’s decision of 20^th April 2011.

It’s no surprise then the BBA finally backed down and both HSBC (£269m) and RBS (£1b est) have now agreed to set aside funds to repay victims of mis sold ppi.  Spanish banking giants Santander who were dealt the biggest fine (£7.1m) for mis selling ppi, did not challenged the findings of the FSA  and has already been repaying its customers.

These figures though, are only provisional and could rise significantly depending on the volume of ppi claims registered by borrowers who want to reclaim, with some analysts predicting that the final cost for mis selling ppi could reach in excess of £10b.

If you have had PPI alongside a loan, mortgage or credit card in the past then call Bank Charges now on 0800 8407291 now and speak to one of our PPI Claims specialists to get your claim started.

Ulster Bank reported a €441m (£391m) loss in the three months this year. Its impairment losses rose from €438m (£388m) to €540m (£479m) in the first quarter

RBS or The Royal Bank of Scotland, its Parent company, expects charges for bad credits from Ireland to remain high in the next three months, before gradually declining in the second half of the year. RBS sustained an impairment charge of £1.3bn in relation to Ulster Bank. Its earnings were affected by a total of £1.95bn of impairments for bad loans.

Its credit quality to its consumers had continued to reduce in line with market trends.
4000 credit arrangements had been laid out for consumers having problems with their repayments. One such includes temporary cutback on repayments or loan extensions.

Ulster Bank said its income fell in the first quarter of 2011 than in the same time in 2010 due to higher funding costs and continued high deposit rates.

Reports tell of its profit reaching €98m (£87m) for the first quarter, before impairment charges.

Its early reform measures left it in a position to capitalize on opportunities for growth that is slowly on the rise in the Irish banking market.

RBS which is 84% owned by government of The United Kingdom, reported its losses amounting £528m, compared to £248m in the first quarter. At an operating level, the bank reported a profit of £1.05bn.

Lloyds Banking Group announced a first quarter loss, after profiting £3.2bn provision for mis-selling claims by customers who took out payment protection insurance (PPI).

After reaching revenues of up to £721 million in 2010, Lloyds Banking group reported a £3.47bn loss for the first three months. £1.1bn was charged to allow for further losses in commercial property prices in the Irish Republic.

Because its provisions for PPI was much bigger than expected, Lloyds’s shares fell by 7.7%, but it did not stop the business from showing growth as customer loans and deposits increased from £842bn to £847.8bn.

SRN Banking Analyst Ralph Silva said the bank as a whole was getting better and is taking a larger market share, but this was before all PPI provisions. New Lloyds Chief Executive Antonio Horta – Osorio presented the results of £284m the bank made during the quarter of the past year.

In February, the bank announced it had returned to profit in 2010, making £2.21bn after reported losses of more than £6bn in both 2008 and 2009.

BBC business editor Robert Peston stated the loss in the first quarter of 2011 would be a “humiliation” for the company after its fluctuating profit last year. However, he states that the new chief executive has no reason to feel such since he was not involved in the past decisions that resulted to loss. The new Chief Executive introduced new management changes of which details on long-term strategy for Lloyds will be discussed in June.

Following the new court ruling and the desire not to engage in this seemingly endless debate any longer, Lloyds will now process thousands of PPI complaints stacked up. The Bank invites all of its customers including those of the former HBOS bank, to contact them if they think they have a claim.

If you are not sure whether you have been mis sold PPI, call Bank Charges now on 0800 8407291 and talk to one of our mis sold ppi compensation specialists.

The Financial Ombudsman Service (FOS) is currently receiving roughly 5,000 fresh claims for mis sold PPI every single week. After the high court ruling on reopening of PPI mis-selling claims last 20^th April 2011, payment protection insurance (PPI) is projected to become the most complained-about financial product ever sold. Over 1.5 million have already asked compensation from their respective loan providers. Most attempts of getting compensation are rejected by banks however those who have taken the next level of seeking the Financial Ombudsman Service got overwhelming results.

It is expected that aside from this great number of claims, there are still millions more of customers who are known to have cases of PPI mis-selling. Truth to be told, more than 16 million PPI policies have been sold unknowingly to customers together with debt products such as mortgages, credit cards and unsecured loans. These mis-sold PPI are placed hidden in the contract and were just added to the total loan amount thereafter resulting to unfair bank charges. Worse, including students or self-employed workers, who are definitely ineligible to claim, were made to sign up to policies.

It is said that this payment protection insurance repay loans if a borrower can no longer sustain paying for his/her loan due to unemployment or sickness.

Last December 2010, the Financial Services Authority (FSA) established new rules which obligated the insurers to review past sales of PPI even without the complaints made by customers. With this, the banks, led by the British Bankers Association (BBA) challenged the reform. They were complaining on how the FSA applies its new rules to old cases which they believe is more than unfair. However, BBA failed to get the high court’s ruling.

An estimated amount of up to £1.3bn over the next five years to come will be paid out on new complaints according to the City Watchdog. Moreover, the reopening of mis-sold PPI claims is estimated to reach about £3.2bn amount of pay-out.

The FSA’s review into PPI arises amid a wider clampdown by the regulator on the way consumer products are sold in the aftermath of the financial crisis. What forced the regulator to abandon its “light touch” attitude and go for a more intrusive approach which could include outright product bans and caps on fees is the series of mis-selling scandals recently.

Perhaps the issue on mis-selling of PPI seems to be never ending. Reclaiming unfair bank charges due to hidden fees caused by these payment protect insurance could be best for anyone who is struggling for his/her finances all because of these hidden subsidies.

A crucial high court ruling will finally decide on Wednesday, at 10 o’clock in the morning whether banks must re-examine the old cases of claims by clients who declared that they were mis sold PPI. This would be the time for the enormous number of bank customers who were victimized by this controversial loan cover if they are entitled for compensation.

About 6.5 million Payment Protection Insurance (PPI) policies are sold annually. However in the mid of 2007, a rising number of complaints against PPI caught the attention of the public. Known as the controversial loan cover, PPI are sold though it is not needed by the customer.

Due to its prevalence, the Financial Service Authority wants banks to change the way that these policies are sold. They also want them to contact those customers who are found to be victims of previous mis-selling. This mandate from FSA has raised the brows of banks led by the British Bankers’ Association and stated that they are lobbying against changes that they say set new standards for old sales unfairly.

The number of complaints received by banks on PPI highly escalated last 2010 due to media coverage and claims management companies which seek and demand for their customers’ refunds. Up to now banks have refused to deal with the mis-selling of PPI until the final ruling.

With much fortune, customers who were refused by their banks and instead filed claims on to the independent Financial Ombudsman Services were nearly all a success. By the year 2009, almost 90% of complaints were upheld.

It is just up to the high court’s decision now if these bank customers are to receive their due compensation. Bankcharges.com has already made a lot of those people who were refused by their banks smile as they receive the compensation right for them.

Public anger at the banks is back it seems. With last week’s news by the Treasury, leaving nothing for the consumer to be happy about, there is no doubt that the public will again turn their anger to the banks. In defence of the consumer Vince Cable and his ally, Lord Oakshott, spoke out at the Treasury’s recent pledges stating “I’m afraid the banks have taken the Treasury for a ride”.

The TUC backed the backlash and stated that the Government cave-in on bonuses last week will only have increased public anger. As the nation struggles to recover from global economic crash caused by the mistakes made by the bankers, it appears the Government has decided to continue backing the banks ahead of their people. The plight of millions of people struggling with their finances in the wake of the banking crisis is being ignored.

Mis sold mortgages, mis sold ppi and unfair credit card charges are costing the consumer millions, while the greedy bankers continue to reward themselves with huge bonuses. If the Government recognises this, and acts to protect the consumer they could and put an end to the public anger.

Consumers who have mis sold mortgages are now resolving the problem by seeking refuge in claiming back any unnecessary costs they have paid. If you feel that you have a mis sold mortgage, call 0800 840 7291 and we will aid in recovery of costs for you. We provide advice and guidance for all consumers who are in receipt of mis sold mortgages.

FOS stands for Financial Ombudsman Service and they are the ones that are battling the mis sold PPI battle for the past few years now. And they have been successful in fighting and suppressing mis sold PPI cases and giving the victims just compensation for their unfortunate fate.

The Financial Ombudsman Service considered the mis selling of PPI a gross misconduct – this means that the mis selling of PPI is just as equal to stealing in the work place or other work place related crimes, such as violence in the work place and etc.

People that have been mis sold PPI are normally the middle class people that didn’t know they have been robbed for the past years; and by knowing they will not endure anymore the times they cannot pay a large sum of money because of the PPI insurance policy. They are advised to file PPI claims so that they can get their refund.

The Financial Ombudsman is always called for mis sold PPI claims, but there are also times the people call Claim companies to do the reclaiming for them – and they are quite effective and successful in claiming the refunds.

If you want to contact a Claim company, you can call this number 0800 840 72 91 so you can start the PPI claim today right away.