Shares in banking titan Lloyds (LON:LLOY) nudged lower as it emerged it had been clouted with a record £117mln fine over the payment protection insurance (PPI) debacle.
The fine levied by the FCA (The Financial Conduct Authority) is the largest retail penalty handed out by the watchdog, it was reported, and is for mishandling complaints from disillusioned customers of PPI following the revelations that lenders had miss- sold it.
The fine covers the complaint-handling period at Lloyds from March 2012 to May 2013.
Lloyds had the biggest market share in PPI products as a result of its takeover of HBOS and it has been dogged by the issue for years.
It has already set aside more than £12bn to deal with compensation claims from customers.
Lloyds said in a statement today: "In order to provide appropriate redress, the group had to build significant operational infrastructure and processes at pace to meet the demands, with 7,000 people processing these complaints.
"Nearly one-third of complaints were found upon investigation to have had no PPI policy with the group."
At its peak in 2012, up to 60,000 complaints were received per week.
It has also been revealed that Lloyds has taken £350,000 away from the bonus pot of chief executive António Horta-Osório in the light of the fine but he could still be in line for a £4mln pay-out.
He said today: "Whilst our intentions were right, we made mistakes in our handling of some PPI complaints. I am very sorry for this."
Lloyds shares eased 0.06% to 87.45p.