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Title:Major banks face increased costs for legal penalties and provisions
Date of publishing:June 09, 2015
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Category:News
Language:English
Also available in the following languages:Dutch, French

Major banks face increased costs for legal penalties and provisions
June 09, 2015

According to the British research organisation CCP Research Foundation, the costs of legal penalties and provisions related to the misconduct of 16 major banks, in the period 2010-2014, totaled 205 billion pound. This represents a sharp increase compared to the period 2009-2013 (173 billion) and 2008-2012 (158 billion). This dishonorable ranking is led by Bank of America (64 billion), JPMorgan Chase (33 billion) and Lloyds Banking Group (15.5 billion). Other European banks in the list are Deutsche Bank (9.4 billion) and BNP Paribas (7.8 billion). More than half of all fines were imposed by US authorities. Only one year earlier, Credit Suisse calculated that the costs of these practices weighed heavily on the stock market performance as the rate of problem banks was 25% lower when compared to banks that don’t face legal problems.

Banks however don’t let it get to them. The 'third' bank in the ranking, Lloyds Banking Group, increased the total combined remuneration of its three directors by 125% in 2015, to over 22 million British Pounds, or on average just under 7.5 million each. In 2014, the bank recorded a cost of 3.4 billion pounds for fines and provisions. In 2008 the bank was rescued by the British tax payer. The government still holds a 20% stake.

Visit the CCP Research Foundation website for more information.