New amount takes total  bill for PPI mis-selling to £1.2bn

Clydesdale and Yorkshire banks have added a further £420m to their collective bill for mis-sold payment protection insurance (PII).

It takes the total set aside by UK banks to tackle PPI mis-selling to £1.2bn.

The banks’ Australian parent, National Australia Bank (NAB), said that the £420m set aside in the half year to 30 September 2014 included £75m announced in August.

The sum includes amounts required to cover the increased costs of administering the PPI remediation programme, as well as amounts to compensate customers under a new complaints handling process, which NAB said is leading to increased payments for new complaints and when revisiting closed complaints.

 The sum also covers the need for the bank to extend its examination of historical records dating back to before 2000, higher than expected levels of new complaints and the fact that Clydesdale Bank is subject to an FCA enforcement process in relation to its previous PPI complaints handling process.