LONDON (Alliance News) - Barclays PLC incorrectly charged interest to consumer loan customers under its retail division, the bank said in its rights issue prospectus.
"UK Retail Bank Barclays has identified certain issues with the information contained in historic statements and arrears notices relating to consumer loan accounts. It is therefore implementing a plan to return interest incorrectly charged to customers," the bank said in its prospectus for its GBP5.8 billion rights issue, published Monday.
The bank admitted it set aside a provision for the costs as of June and held enough to cover operational costs incurred, as well as the remediation it considers adequate to customers. Barclays didn't specify in the prospectus the size of the provision.
Barclays said its other businesses - including Barclaycard, Barclays Wealth and Barclays Corporate - may also face similar issue and is reviewing them to check for similar or related issues. It warned the outcome could result in weaker financial results or even regulatory attention.
The bank is already contesting a GBP50 million fine in relation to an GBP11.8 billion capital raising that helped it avoid requiring UK government support in 2008. The FCA accused Barclays of failing to disclose GBP322 million in advisory fees payable to Qatari investors which would then provide billions of pounds of capital to Barclays.
Barclays shares Monday closed at 305.4 pence, up 3.8 pence, or 1.3%.
By Samuel Agini; samagini@alliancenews.com; @samuelagini
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