Lloyds Banking Group and Close Brothers have warned of material increases to their provisions for mis-sold car finance compensation following the Financial Conduct Authority’s proposed redress scheme. Lloyds, whose share price fell 3% off the back of the news, has already set aside £1.2bn and said it may need to allocate significantly more, with analysts estimating a total exposure of up to £2bn.
Close Brothers, whose car finance accounts for over 20% of its loan book, echoed the warning, stating the scheme could lead to a substantial rise from its current £165mn provision, which saw their share price drop 9%. The FCA estimates the industry-wide cost at £11bn, covering 14.2mn agreements from 2007 to 2024.
The Competition and Markets Authority granted an average 3% increase on top of the 24% rise already approved for 2025–2030
Meanwhile, millions of UK households face higher water bills after five major suppliers, Anglian, Northumbrian, South East, Southern, and Wessex, successfully appealed Ofwat’s price controls. The Competition and Markets Authority granted an average 3% increase on top of the 24% rise already approved for 2025–2030. The CMA justified the decision by citing the need for pollution reduction, supply resilience, and higher financing costs, though it rejected nearly 80% of the companies’ requested increases. The five suppliers provide water supply and sewage services to 14.7mn households.
Gold reached a new historic high this week, having breached $4,000/oz for the first time
Gold reached a new historic high this week, having breached $4,000/oz for the first time, as investors flocked to the safe haven asset off the back of inflation worries and continued geopolitical tensions, whilst central banks have been buying up the yellow metal to diversify themselves away from the US dollar.
Our specialist's final thought
"The gold price reached $44,047/oz on Wednesday, with silver also having its own historic day, having reached a new all-time high of $49.57/oz."
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