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Lloyds makes extra £375m provision for PPI compensation

Lloyds makes extra £375m provision for PPI compensation Lloyds Banking Group has reported falling profits and set aside an extra £375m to pay for payment protection insurance (PPI) compensation. Pre-tax profit in the first quarter of 2012 was £288m, compared with a £3.5bn loss in the same period last year. Lloyds’ boss said it “reflected the subdued UK economic environment”. Lloyds, which is 40%-owned by the government, said the extra PPI provisions were down to “the increase in the volume of complaints”. Last week Barclays also increased its provision for PPI compensation, setting aside an extra £300m. PPI is supposed to cover borrowers’ loan repayments if they fall ill, die, or lose their jobs. But it became highly controversial and there have been years of campaigning by consumer groups against the widespread mis-selling of the policies. Lloyds has now set aside £3.6bn to cover compensation payments. http://www.bbc.co.uk/news/business-17904674   test