It’s normally Lloyds Banking that are making the headlines when it comes to PPI figures, given that they’re responsible for over half of the total PPI refund outlay so far, however what we’re not hearing so much about is the knock on effects that are damaging Barclays and RBS. The two banks are responsible for only £3.8 billion between them. However, both banks have been forced to cut jobs and ringfence services.
Recently, Barclays confirmed an 8% drop in profits due to the size of its refund responsibilities. Directors and senior bankers had been forced to give up around 2 million shares to cover the tax liabilities for earlier posted profits.
RBS has focused on cutting back and middle office sectors in an attempt to shrink down its different divisions. However, in order to try and protect profits the bank is expanding its operations in India.
To reduce the issue of further insurance mis-selling and the high costs of retraining and commissions, the bank had cut 550 advisor roles. Its investment advice service for customers only has a budget of £250,000 as a ‘robo-adviser’ would serve more customers with smaller savings.