When Lloyds Banking Group called a halt to its £1.75 billion share buyback scheme this week, it was, undoubtedly, a setback for shareholders.
Lloyds announced the move after warning that it would have to set aside a further £1.2 billion to £1.8 billion to cover a wave of last-minute compensation claims over the mis-selling of payment protection insurance. It said that it would now amass less capital than expected this year and that its return on tangible equity would be below its previous guidance of about 12 per cent.
Lloyds is by no means the only bank to have been found wanting in the PPI scandal, which is set to cost the main lenders more than £50 billion. However, it has been the most exposed,