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Lloyds surges as Supreme Court grants motor finance case appeal

Published 11/12/2024, 12:33
Updated 11/12/2024, 12:41
© Reuters.  Lloyds surges as Supreme Court grants motor finance case appeal
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Lloyds Banking Group PLC (LSE:LON:LLOY) shares headed higher on Wednesday on news the Supreme Court would hear an appeal against October’s ruling over motor finance mis-selling.

Lloyds, which is among those exposed to potential compensation, gained 4.3%, while peer Close Brothers (F:CBRO) Group PLC (LSE:CBG) jumped 8.3%.

Shares in both had been hit by a Court of Appeal decision that hidden commissions from banks to salespeople around car finance were illegal.

The Supreme Court on Wednesday said it would allow Close Brothers to appeal the ruling, which opened the door for lenders to potentially have to pay billions in redress.

Lloyds has set aside £450 million to cover possible compensation, while Banco Santander (BME:SAN) (LSE:BNC) unveiled a £295 million provision recently.

Close Brothers has not disclosed its potential hit but stopped writing new motor finance deals in October in the wake of the ruling and pointed to a possible impact next year.

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