Barclays increases PPI provision to £2bn

Barclays Rain 480

Barclays has increased its provision for payment protection insurance (PPI) by £700m, raising the total level to £2bn.

The bank announced it had experienced “higher than previously anticipated levels” of claim volumes since the end of the second half of the year.

The latest £700m is in addition to £1bn set aside in 2011 and a further £300m provision announced during the first quarter of the year.

A spokesman says: “Based on claims experience to date and anticipated future volumes, the resulting provision includes Barclays best estimate of expected costs of future PPI redress.

“Barclays will continue to monitor actual claims volumes and the assumptions underlying the calculation of its PPI provision.”

The bank will release its third quarter interim management statement on 31 October, according to a market statement, in which it expects to announce adjusted pre-tax profits of £1.7bn, in line with market consensus. The profits exlude the extra £700m PPI provision and a charge of £1.1bn.