PPI mis-selling is back in the news today, as Clydesdale Bank (CYBG) announces a further £450m is being set aside by them to cover the costs of compensating consumers for mis-sold Payment Protection Insurance.

As reported in The Guardian, this further amount is mainly being absorbed by National Australia Bank (NAB), who had already pledged to cover £1.7bn of future PPI bills.

The article states:

Payment protection insurance payouts continue to hang over Clydesdale Bank which announced a fresh £450m charge for the mis-selling scandal in its debut results as a stock market listed company.

Officially known as CYBG since being spun out of National Australia Bank earlier this year, the bank is also trying to cut costs to bolster its profitability as an independent entity.

When NAB sold off the business, which also includes Yorkshire Bank, it pledged to cover £1.7bn of any future PPI bills, which has cushioned the hit of the latest £450m charge on CYBG’s profits. The standalone bank is taking only £44m of the cost of the PPI provision.

The demerger of the bank was a milestone for NAB which had faced years of speculation about the troublesome UK operations, which had been hit by compensation costs for the PPI scandal as well as interest rate swaps mis-selling to small businesses.

It has 274 branches, 40 business banking centres and employs 7,268 staff across the UK.

As it published its first interim results as a listed company, chief executive David Duffy said: “We are progressing with our plans to become a more efficient, responsive and productive business, and now expect our costs for the year to be £730m, materially below our previous guidance as we begin to see the benefits of actions we have taken to lower the cost base and standalone and separation costs which were lower than expected.”

He had previously expected costs to be £762m for 2016 and said 150 senior staff would be leaving later this year after taking voluntary redundancy.

Half-year profits were £58m compared with a £440m loss a year earlier although Duffy focused on the 4% fall in underlying profits - which stripped out conduct costs and the cost of separating from NAB - to £107m.”

Responding to this latest figure, Simon Evans of the Alliance of Claims Companies said:

“We are still seeing large amounts being set aside by banks to cover the cost of the PPI mis-selling scandal, all against the backdrop of a potential time-bar for claims being introduced by the FCA. This simply doesn’t add up. We believe that there are a large amount of consumers across the United Kingdom who have still not reclaimed the money that is rightfully theirs, and we would urge them to consider doing so now, whilst the FCA considers how to press ahead with its time-bar proposals.”