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Barclays bank takes extra £1.0-bn charge for mis-selling

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(Globalpost/GlobalPost)

Scandal-hit British bank Barclays said Tuesday that it will set aside another £1.0 billion ($1.6 billion, 1.2 billion euros) to cover compensation for the mis-selling of both credit insurance and interest rate hedging products.

Barclays, which was rocked last year by the separate Libor rate-rigging scandal, said in a brief statement that it hiked its provision for the mis-selling of payment protection insurance by another £600 million, taking its total bill to £2.6 billion.

The lender added that it would also increase its provision for the mis-selling of interest rate hedging products to small businesses by £400 million to a total of £850 million.

Barclays made the announcement ahead of its 2013 results statement which is due on February 12, when it will give more details on the provisions.

Group chief executive Antony Jenkins had announced last Friday that he would give up his 2012 bonus after a "very difficult year" at the troubled bank.

Barclays slumped into crisis last June when it was fined £290 million by British and US regulators for attempted manipulation of Libor and Euribor interbank rates between 2005 and 2009.

The Libor system was found to be open to abuse, with some traders lying about borrowing costs to boost trading positions or make their bank seem more secure.

Jenkins recently ordered all Barclays employees to sign up to a new ethical code of conduct or quit, as he sought to draw a line under the damaging episode.

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http://www.globalpost.com/dispatch/news/afp/130205/barclays-bank-takes-extra-10-bn-charge-mis-selling