Lloyds claws back bonuses after PPI scandal

Five directors of Lloyds Bank, including the previous Chief Executive, will be forced to pay back some of their 2010 bonus, reports the Telegraph.

Lloyds has had to set aside £3.2bn to cover claims arising from the mis-selling of payment protection insurance (PPI), it's those losses which have prompted the so called "claw back" exercise.

Lloyds is thought to be the first British bank to exercise a claw back clause and does so as bankers' pay comes under intense scrutiny following the financial crisis of 2008.

Try 6 free issues of MoneyWeek today

Get unparalleled financial insight, analysis and expert opinion you can profit from.

Start your trial

Sign up for MoneyWeek’s free twice-daily newsletter.

Join more than 165,000 subscribers and keep yourself informed with latest financial news, insights and expert analysis to help you understand what really matters when it comes to your finances.

Join more than 165,000 subscribers and keep yourself informed with latest financial news, insights and expert analysis to help you understand what really matters when it comes to your finances.

Sign up

The Telegraph claims the total sum that will be handed back amounts to £1m although the BBC is reporting the actual figure to be nearer £2m.

The papers claims the directors concerned are "furious" at having to give the money back, arguing they acted within the law as it stood at the time that PPI was sold.

BS