Lloyds Banking Group now employs 1,000 people to deal with PPI complaints

The weight of payment protection insurance claims continues to drag down profits at Lloyds Banking Group. It took another £700m hit in the first six months of this year, almost double that of the first quarter, and posted a pre-tax loss of £439m so far this year.

Obviously, this is bad news and the warning from chief executive António Horta-Osório that the sector was facing “deep crisis of confidence and trust” won’t exactly reassure the bank’s already beleaguered Scottish workforce.

Over 4,500 people have departed Lloyds since the beginning of 2012, even if half of these people left voluntarily or were redeployed, and it’s saved £512m through its ‘simplification’ programme.

The one positive from a recruitment perspective is that the PPI mis-selling problem is offering new job opportunities. We mentioned last year that a number of banks in Scotland were taking on people to deal with PPI complaints and Lloyds supports this view.

It now has over 1,000 people dealing with PPI complaints, largely from claims management companies pursuing false compensation requests. During the first quarter, one in four complaints came from these companies, but this has risen to 50% in the second quarter. Expect more work to come out of this.