The fallout of the payment protection insurance (PPI) scandal is proving costly for banks.
Following the alleged mis-selling of insurance policies for mortgage, loan and credit card products, banks have had to shell out billions of pounds to deal with millions of customers seeking compensation.
Latest figures suggest the UK 's five largest banks, Royal Bank of Scotland , HSBC, Barclays, Santander and Lloyds, have so far set aside a total of £8.8 billion to deal with demands for compensation.
HSBC announced yesterday that it had made a further provision of £340 million to cover the costs of claims.
The bank also revealed that an extra £450 million had been allocated to deal with fines relating to allegations of money laundering in the US . It is believed that weak controls had left the bank 'vulnerable' to global money laundering.
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