RE: March 2025 Lloyds Banking Group Sale over was £6 now 73p5 Mar 2025 12:02
Cips, matt & paul...so lets tals lloyds, whats is your thoughts on the Pending decision on Motor Finance Mis-selling?
As you know a High Court ruling , is expected next month, concerning allegations that UK banks and car finance providers mis-sold motor finance products, particularly through discretionary commission arrangements (DCAs). These arrangements allowed brokers and dealerships to set interest rates on car loans, leading to inflated costs for consumers. Regulators believe that millions of UK customers may have overpaid.
The Financial Conduct Authority (FCA) is currently investigating the scale of potential compensation. Industry estimates suggest that total payouts could range between £6 billion and £16 billion, with worst-case scenarios reaching £18 billion. This has raised concerns among investors about the impact on UK banks' balance sheets and share prices.
If the High Court rules against lenders, banks such as Lloyds, Barclays, NatWest, and Santander UK could be forced to make substantial provisions, mirroring the impact of the PPI scandal. Some financial analysts warn that this could lead to a sharp decline in bank share prices, while others believe that lenders may attempt to cap payouts to protect profitability.
Lloyds is among the most exposed lenders due to its strong presence in the car finance market. The bank’s previous £20 billion PPI provision heavily impacted its share price, and a large-scale motor finance compensation scheme could further strain investor confidence.
Lloyd’s history only provides proof it established itself as a selling monster, the PPI scandal is testament to this. The PPI scandal the banking sector, particularly Lloyds Banking Group's total cost for mis-selling Payment Protection Insurance (PPI) has reached approximately £22 billion; however they initially set provisions at 4.5bn.
Do you think the provision set for the mis-selling motor finance? do you think government influence will sway any decisions dispite what was wrote in the media?
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