Lloyds Banking Group has set aside £450mn to cover potential costs relating to a UK regulatory probe into its historic motor finance commission arrangements.
The Financial Conduct Authority launched an investigation last month to determine whether people were overpaying for car financing loans. Under so-called discretionary commission arrangements, some UK banks had allowed motor dealers to adjust the interest rates customers paid on loans, increasing their commission — a practice banned in 2021. The FCA stated that settlements would be sought if evidence of widespread misconduct is found before that time.
