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Barclays adds £300 million to PPI provisions

Barclays adds £300 million to PPI provisions

Category: Banking

Updated: 26/04/2012
First Published: 26/04/2012

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.
Barclays adds £300 million to PPI provisions

Barclays has revealed that it has set aside an extra £300 million to compensate customers mis-sold payment protection insurance (PPI).

The admission came as part of the banking group's results for the first three months of the year, which it described as 'encouraging'.

The £300 million provision comes on top of the £1 billion that was set aside to pay back PPI customers in 2011.

Along with the new funds for PPI, an accounting adjustment of £2.62 billion meant that Barclays recorded a pre-tax loss of £475 million in the opening months of this year.

But without the impact of the two factors, it achieved profits of £2.45 billion – well in excess of analysts' forecasts.

Its investing banking arm performed well, with income totalling £3.46 billion, up by 3% on the first three months of 2011 and 91% on quarter four of last year.

The retail banking arm of the group posted profits of £334 million, while Barclaycard saw a 18% rise in profits, up to £349 million.

"Barclays' first quarter results are an encouraging start to the year and demonstrate continued progress across our execution priorities," said Bob Diamond, chief executive.

"The environment in which we operate remains unpredictable but we have a proven ability to adapt and grow our businesses in the face of external change.

"We will be proactive and seek to lead the agenda on recovery and resolution planning, which is a critical step to eradicate 'too big to fail', while continuing to remain closely engaged with regulatory agencies and Governments."

The results come just a day before Barclays is to hold its annual general meeting, when a number of members are expected to vote against a pay deal for a number of senior executives and Mr Diamond.

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