Earlier today, Barclays PLC announced that it will compensate all it’s customers who complained they had been mis sold PPI before the 20th April 2011 on a “no questions asked” basis.

Barclays, who along with Lloyds Banking Group, Natwest and RBS had previously placed thousand’s of claims on hold pending the outcome of the Judicial Review into the handling of PPI complaints, are now facing a mountainous task of clearing the backlog they have created as well as having to deal with the deluge of new PPI compensation claims.

The FSA has granted Barclays, Lloyds and RBS special dispensation, in the form of an extended time period of 16 weeks, to deal with new PPI complaints to help them deal with the backlog of PPI claims that were previously “stayed”.

A spokesman for the Barclays is quoted as saying “Working in close co-operation with the FSA and the Financial Ombudsman Service, and in recognition of the delay customers have experienced whilst awaiting the outcome of the high court judgment, we can confirm that we are contacting customers whose complaint was put on hold on or before 20 April with an offer to settle their complaint in full as a gesture of goodwill.”

Royal Bank of Scotland boss, Stephen Hester, has confessed that a percentage of his staff’s bonuses may have come from taxpayer funds.

UK banks enjoy approximately £10bn of taxpayer funds per year, and Stephen Hestler enjoys a £7.7m wage deal. At the same time, his employees benefited a sum of £1m “take home” earnings plus £375m worth of prizes divided to key employees in 2010.

The administration’s “safety net” which maintains a build up of its large loan book, made it possible for the bank to acquire cheaper credit deals.

This “understood security” was lucrative business from which executives and banking employees get bigger incomes, the RBS head disclosed.

Hester stated, “The subsidy could have fed through to lots of places – the price of loans, the general economy, employment in banks and bonuses,” assuming a big possibility of “leakage to all the above.”

However Barclays head Bob Diamond denied of having benefited taxpayer subsidies and defended their business’ capital “was raised from money markets.”

Meanwhile Business Secretary Vince Cable notified the business, innovation and skills committee to have ordered evidence of executive wages coming from lending, as was agreed in the Project Merlin contract.

ICB chairman Sir John Vickers thought that UK banks could set aside a minimum of £10bn “disaster funding cost” per year, should taxpayer intervention happen again.

Vickers suggests on forcibly protecting all banks’ operations so their “casino” operations won’t affect loan borrowing and establish banks’ independence from tax payer subsidies.

However, his proposal aroused various standpoints on the pros and cons of ring-fencing.

HSBC’s chairman Douglas Flint expressed his concern that additional fortification should be needed to prevent 2008’s disastrous crash in lending and banking from reoccurring.

Arguably, Hester claimed ring-fencing banks would make them “protected beasts” that would brave investment risks, because of the state safety net. He also added it could also boost loan and mortgage value.

Lloyds Banking Group chief executive Antonio Horta-Osorio estimated a five- year recovery of the bank from its losses due to PPI compensation which it orchestrated last month.

The bank has set aside a £3.2 billion  PPI compensation package for its customers who were mis-sold payment protection insurance (PPI).

Horta-Osorio states, “This bank will be built over time – it is a three-to-five-year journey”.

Ireland’s economic decline has further pushed the bank to a first quarter 3.5 billion pound loss – a colossal task for the chief executive. But the Lloyds boss simply quoted, “It is fair to say some of the problems were more intense.”

The former Santander UK CEO stated that it is apparent “what the shape of the business will be in the future and how we expect to get there” since he had only been in the hot seat for three months. He said he will “not be setting out a full five-year plan.”

After bailing out on billions of taxpayer funds in the loan crisis, Lloyds was forced to sell a large sum of its assets in March as instructed by city regulators. The Independent Commission on Banking advised it to sell more in order to improve competition while European regulators thought 600 branches would be a good number to reach recovery.

A recent survey during April revealed experts and investors expect the Portuguese executive to sell off its Scottish Widows and St. James’ Place to help the balance sheet.

The British government is planning to put 41% of the bank’s stakes claimed during the bailout plus the part-nationalized Royal Bank of Scotland on the market, back to the private division.

Barclays is the first among high street banks to be put to a business model assessment (BMA) that will investigate individual sources of profit that comes in the company.

Lloyds Banking Group and investment banks Goldman Sachs will also be submitted to the test in the next few months.

BMAs were implemented by the Financial Services Authority to enforce a “forward-looking, judgment-based regulation” in due time for its makeover into the new Prudential Regulation Authority by the beginning of 2013.

The Experts’ job will be to ensure liquidity among firms, including the use of the Special Liquidity Scheme by the Bank of England.

Revenues and Funding will be under “stress tests” in order to build banks’ independence from subsidies.

Stress tests will examine the consequences of “structurally lower investment banking margins” and extended low interest rates on retail revenues.

The Financial Services Authority (FSA) chief executive Hector Sants supports the power given to city regulator to structure its own analysis of the “long-term profitability of investment banks,” thereby giving the authority to “challenge chief executives’ decisions and force them to modify their business plans”.

The City watchdog accomplished capital and liquidity stress tests on several banks and has formed aggregate models of productivity. It has built a meticulous analysis on potential business risks in everyday transactions.

He further stated, “This is about getting a third leg of the stool which is adding in the firm specific models. It’s about looking at a bank’s earning capability and the drivers of those earnings to alert us to increasing risks being taken and enabling us to have out own answers to the risks posed to that capability in the future and therefore a bank’s ability to grow its’ capital base”

The FSA has already started a “sector-wide” model for funding for UK banks to asses their reliance on different liquidity sources, like the Bank of England’s Special Liquidity Scheme as well as the “covered bond market and retail deposits” of which value to their corresponding financial institution are currently assessed.

The banks are under close scrutiny in the wake of the mis sold PPI scandal.  If you would like to know more about Payment Protection Insurance and whether you may be entitled to PPI compensation, call Bank Charges now on 0800 8407291.

Due to discontentment, thousands of unsatisfied customers are transferring their accounts from high street banks Royal Bank of Scotland, Barclays, HSBC, Lloyds, and Santander to their smaller competitors who claim to offer alternative services.

Among these small banks are: Handelsbanken, a bank that received outstanding reviews primarily because they do not sell financial products like the PPI, nor utilize incentive bonuses to sell them; Nationwide Building Society, which reported 353,000 new accounts opened; and Metro Bank, who claims to have “no stupid bank rules”, has opened six branches in London and is setting eyes on expanding to Birmingham or Manchester.

According to a recent study headed by Accenture, the percentage of high-street customers who would recommend their banking institution to loved ones and friends dropped from 64% to 58%.

Additionally, Customer satisfaction also plummeted from 84% in 2007 to 73% in 2011, due to unsatisfactory complaint handling.

Lloyds Banking Group and Santander received disapproval by the Financial Services Authority for poor PPI complaint handling as well as BOS who was recently fined ₤3.5m on top of another ₤17m for its mis sold investment products.

In a survey in May by Moneywise, Santander ranked the worst complaint handler, with reviews of bad service of going up to 40%, followed by Barclays with 11% and Halifax receiving little over 9%.

Accenture senior executive explains, that the declining trust in high street banks have influenced consumer behavior to transfer to newcomer banks who benefit greatly from the switch.

Barclays Bank Plc has announced that it is cutting 500 employees from its U.K. division.

Daniel Hunter, the spokesperson for UK’s third largest bank says 500 of its employees have already received redundancy packages. The financial services provider currently holds 11,000 employees around the world.

This is part of the “ongoing transformation of Barclays corporate, we are making some changes to our business in order to optimize growth opportunities and control costs”,

The spokesman said, even if this means chopping off a number of jobs.  The bank is now focusing on division examinations for business returns.

Meanwhile, contemporary Lloyds Banking Group has announced it will re assign a large number of employees; 360 workers for its insurance, wholesale and human resources and 140 will be re-assigned.

Trade Union Unite national officer David Flemming remarked, “Everyday this week massive groups of staff in processing centers, bank branches and call centers, across the country have been told that their futures are uncertain.”

The banks are currently struggling to process the thousands of PPI complaints that are flooding through on a daily basis and are under pressure to resolve their customers PPI claims swiftly or face further fines from the FSA.

Just in case any of you missed it, last nights BBC Watchdog programme included an interview with Money Saving Expert  Martin Lewis, who appeared on our screens in his usual enthusiastic manner, to urge borrowers to contact their lenders and demand a PPI reclaim if they feel they have been mis-sold.

Mis sold PPI has been a hot topic over the past few weeks, following the BBA’s decision to abandon their legal challenge against the FSA and FOS.  The banks have now collectively, set aside funds as a PPI Claims Provision of over £5billion to repay the customers who had previously been mis sold.

He identified the main causes of mis sold PPI as being:

• PPI being added without the borrowers knowledge – so check your paperwork
• Borrowers being told that PPI was compulsory – it wasn’t
• PPI being sold to borrowers who were self-employed – they are not eligible to claim
• Borrowers medical histories not being checked – meaning they can’t complain due to pre-existing medical conditions

Although he’s not an advocate of using a Claims Management Company (CMC) to process your PPI claim, he added that they provide a valuable service for people who would struggle with filling out the paperwork, and those who would find the stress of dealing with the banks themselves, too much to handle.  Adding that CMC’s are a good option for borrowers who have loans, with PPI, from non-mainstream or sub-prime lenders.

Martin also advised, anyone who currently has a loan or has settled a loan in the last 6yrs to check their paperwork to see if Payment Protection Insurance has been added without their knowledge.  For those that can’t locate the paperwork or cant remember the lenders details, get your Credit Report from Experian or Equifax, for as little as £2 and you will have the information you need.

It’s then just a case of writing to your lender to ask for a PPI refund or contacting Bank Charges.com on 0800 8407291 to get your claim started. Simple!!

Halifax and Bank of Scotland have been fined £3.5 million for unsatisfactory complaint handling – the largest fine ever imposed by industry regulators The Financial Services Autority for mis-handing of complaints.  The fine also acts as a stark warning to the banks who chose to put PPI claims on hold pending the outcome of the Judicial Review into Payment protection Insurance.

About 8,600 customers will be given redress, after The Financial Services Authority investigation revealed a handful of complaints poorly dealt with, mostly filed by old customers with little to no knowledge about the investments mis-sold.

The banking group wrongly dismissed a ‘significant number’ of complaints it has received for the number of weeks since it had started dealing with mis sold complaints. The bank currently holds a record of 2,592 complaints between July 30, 2007 and October 31, 2009, from mis selling investment products like personal investment plan, collective investment plan, guaranteed growth bond, ISA investor and guaranteed investment plan.

In addition to poor complaint handling, the staff also failed to check relevant customer information. Furthermore, complaints were not fairly examined, leading to poor decisions on the customer’s product suitability.

The FOS upheld 46% of claims that the bank had dismissed, but however, was not able to fully examine the trends that influenced the complaint.

The BOS failed to properly examine the source of these complaints, which would have helped pinpoint the factors of the mis selling of these investment products and be able to draw clear view of how this could be prevented in the future.

The group has shelled out 2.4 million pounds of redress to BoS and Halifax consumers whose reviews were completed.

Bank of Scotland will be starting its review of its 7,903 past investment products sales done between July 30, 2007 and March 1, 2010. Bank of Scotland acknowledges their short comings and guarantees customers of informing customers right away if he/she is due for compensation.

Government members were disappointed when UK banks failed to meet Project Merlin lending targets.

The five signatories to the lending agreement RBS, Lloyds, Barclays, HSBC and Santander UK pledged to the Government last February 9 to provide adequate finance to small and medium enterprises. (£76 billion as this year’s target).

The banks also promised to help overall business lending to £190 billion.

However in its first quarterly lending report, around 2 to three billion pounds fall short on £19 billion which was targeted for the first three months of the year.

The reason behind bank’s incapability to meet deadlines lie on the availability of the lending capacity, which was not fully taken up due to muted demand.

Some analysts believe banks will claim that there is no demand for lending, and said they only agreed to increase “lending capacity” and “there is nothing they can do in the absence of demand for new borrowing”.

Capital Economics Vicky Redwood stated that small businesses are not making a move in asking for the loans because they do not believe banks will give it to them.

She said that the “agreement was not clear what consequences the Government put on if the banks do not do what they promised. In any case, the Government is unlikely to do anything yet. After all, the agreements were for 2011 as a whole and it is only fair to let the banks try to get back on track.”

Banks often evade their responsibilities and always look for opportunities to gain more profit as proven by the Mis Sold PPI Scandal and the extortionately high interest rates on credit cards that we’re seeing today.

If you are one of those who has been a victim of the banks, we can provide assistance in reclaiming mis sold PPI.

Top UK banks are considering a clawback on bonuses from former bosses who were involved in the PPI mis-selling scandal.

PPI redress amounts to billions, and it is believed that banking executives slipped millions into their pockets during years PPI was actively mis sold.

Banking Insiders warn that if they decide to do so, they will face a huge legal case.

Several banking sources said procedures were not present during the 5-year mis- selling duration, and even if they did exist, its application will not be easy.

“You could try to claw back bonuses, but you would find yourself in court” one source stated.

Chief executive of Lloyds Banking Group Antonio Horta – Osorio stated that his compensation body will evaluate the situation’s suitability. On the other hand, Royal Bank of Scotland’s head of retail division, Brian Hartzer would consider bonus claw back like his contemporaries HSBC and Barclays.

However, The Financial Services Authority orders that only 40% of remuneration should be set aside and that it may be subject for claw back if situations call for it.

Since there is no law to regain money that had been handed out, a source said only bonuses postponed would make for a suitable clawback.

PPI policies were originally intended to help borrowers with their debts in the event of redundancy or illness and widely mis-sold between 2005 and 2010. They have now been forced to set aside £billions to repay their customers who had been mis sold ppi.

After their initial fight in trying to overturn the policies in handling PPI, the BBA have finally agreed to compensate its customers.

Already banks are paying out billions worth of compensation. Here at bankcharges.com, we are committed to reclaim mis sold ppi that had been wrongly collected by high-street banks. Call us up at 0800 840 7291 and learn how.