The British Bankers Association (BBA) has said it will not appeal against the high court verdict which allowed new FSA rules to be applied retrospectively on Payment Protection Insurance mis-selling. The BBA move comes close on the heels of Barclays and Lloyds Banking Group’s announcement that they will not lend any support to the appeal.
The High Court had previously rejected BBA’s argument seeking a judicial review of new complaint measures formulated by the FSA and Financial Ombudsman Service to redress consumer complaint against Payment Protection Insurance mis-selling.
“The BBA on behalf of its members judicially reviewed the FSA and the FOS regarding the retrospective elements in the proposed FSA rules for handling PPI complaints. The judgment was handed down on April 20 and found in favour of FSA and the FOS. The BBA was given until May 10 to appeal”, said BBA in a statement.
“In the interest of providing certainty for their customers, the banks and the BBA have decided that they do not intend to appeal. We continue to believe that there are matters of important principle which we will be taking forward in other ways with the authorities”, it added.
Britain’s biggest retail bank, the Lloyds Banking Group had said last week that it is making provisions of £3.2 billion to settle customer claims. Barclays announced a similar move saying they are setting aside £1 billion. Taxpayer owned bank RBS has also announced its decision of not contesting the verdict though it is yet to announce the amount of provisions it plans to make to settle claims.
RBS welcomed the BBA’s move saying it will help restore consumer confidence in British banks. Payment Protection Insurance had created furore after it was found banks had sold the products to customers who are ineligible to claim the benefits.