PPI

Shop Direct

Littlewoods and Very.co.uk group Shop Direct has secured a £75m equity injection from its owners to help cover its PPI bill.

The group's auditors warned last month Shop Direct could collapse unless it secured an extra £150m in funding to meet soaring costs of payment protection insurance mis-selling claims.

Shop Direct said its owners the Barclay brothers had pledged the full £150m, with £75m set to be pumped in by the end of November.

But it added: "We are continuing to work with our financial advisers to evaluate alternative financing options for the £75m that will initially remain undrawn."

The Barclay brothers are reviewing all of their business empire, including the group that publishes the Daily Telegraph and Sunday Telegraph newspapers.

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The UK business of Santander took a major hit from the PPI mis-selling scandal as profits dipped in the first nine months of the year.

Pre-tax profits at Santander UK fell 43% to £785m, as the bank took a £169m charge from PPI.

Meanwhile, economic uncertainty as Brexit and a trade war continue to weigh on the global economy also hit its bottom line.

"Our profitability for the first nine months of 2019 has been impacted by ongoing competitive income pressure, additional PPI costs as well as transformation programme investment," said boss Nathan Bostock.

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Banks have been blamed for the axing of a further 120 jobs a claims management call centre in Wales.

We Fight Any Claim in Cwmbran, Torfaen, said the banks had been "thoroughly unprepared" for the 29 August deadline for mis-sold payment protection insurance which had "severely affected" its income.

In September it announced it was shedding 130 jobs after the deadline meant less work for the claims company.

On Thursday it said bank "inaction" had led to the further job losses, which mean the number of works would fall to 150 from 400 in September.

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The Competition and Markets Authority is not able to issue fines for the situation it has found at Nationwide - and four other PPI providers in the past - but said it had asked for powers to do so.

It follows an investigation into PPI by its predecessor body, the Competition Commission, in 2011, which led to a legally-binding order requiring PPI providers to send customers annual reminders that clearly set out how much they have paid for their policy, the type of cover they have, and reminders of their right to cancel.

Adam Land, a senior director at the CMA, said: "Nationwide has broken the rules by not sending essential PPI reminders to their customers. Eight years on from our legally-binding order, it is simply unacceptable that the CMA is having to remind Britain’s biggest banks of their legal obligations.

"Nationwide has failed its customers by denying them important information, and the directions we’ve issued today will lead to affected customers receiving the refunds they deserve.

"Such breaches are serious and, if we had the extra powers we’ve proposed to the government, could have resulted in fines."

NEWSCAST

The Competition and Markets Authority (CMA) has announced that Nationwide Building Society will pay up to £2m customers after failing to send - and sending inaccurate - payment protection insurance (PPI) reminders.

The competition watchdog said it was requiring Nationwide to put in place procedures to ensure that similar problems do not happen again.

As well as these legally-binding directions, Nationwide has already repaid more than £100,000 to customers who did not receive reminders, the CMA said.

The building society is also in the process of refunding thousands more customers who received inaccurate information, with total repayments of up to £2 million expected.

More than 7,000 customers could be due refunds.

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The total cost of the payment protection insurance (PPI) scandal has topped £52bn, according to New City Agenda, a financial services think tank and forum established by Lord McFall, David Davis MP, and Lord Sharkey.

That's after adding in the bill that Co-operative Bank published on Monday when it said it faced an additional charge of up £75m.

The think tank, which is keeping a tally of the bill for the mis-selling of the insurance product, says that some firms are yet to provide an update since the deadline for claims for last month.

It says that among them are HSBC, Santander and Tesco.

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Nationwide Building Society is the latest financial firm to announce a fresh provision for payment protection insurance (PPI) compensation claims.

It says that like others in the industry it received "a higher than anticipated volume of complaints and enquiries" in the period immediately before the deadline last month to make a claim.

The extra provision could amount to between £20m to £50m.