RE: DCA Liability10 Aug 2025 13:55
"Would be interesting to see if Lloyds discloses any contingent liabilities or provisions related to this in their next update."
Did you read the Motor Finance Update RNS Lloyds issued on 4th August?
"As previously stated, in establishing the existing provision the Group created a range of scenarios to address uncertainties around a number of key assumptions. These included a range of potential Supreme Court outcomes, regulatory responses and outcomes in relation to redress. Whilst the judgment announced on 1 August provides additional clarity, there remain a number of uncertainties that the Group continues to consider in its approach to provisioning. The Group's approach therefore continues to include the assessment of multiple scenarios. The FCA announced yesterday that it will publish a consultation on an industry wide redress scheme by early October. The FCA will propose that the scheme covers discretionary commission arrangements (DCA) and will consult on which non-DCA arrangements should be included. The FCA outlined certain other factors on which they will consult. The ultimate impact on the Group will be determined by a number of factors still to be resolved, in particular the outcome of the FCA consultation and any further interventions as well as any broader implications of the judgment, including legal proceedings and complaints.
After initial assessment of the Supreme Court judgment, and pending resolution of the outstanding uncertainties, in particular the FCA redress scheme, the Group currently believes that if there is any change to the provision it is unlikely to be material in the context of the Group. The provision will continue to be reviewed for any further information that becomes available, with an update provided as and when necessary."