By Carlo Martuscelli

Lloyds Banking Group PLC (LLOY.LN) said Monday that it was suspending its share buyback program following a spike in information requests over missold payments protection insurance.

The British banking group said it now expects to book 1.2 billion to 1.8 billion pounds ($1.47 billion-$2.21 billion) in PPI-related charges in its third-quarter results. This is after a surge in complaints in the final month before the deadline.

Around GBP600 million of capital that was allocated to buy back shares from the market will now be held in reserve, Lloyds Banking Group said. However, the company said it continues to target a progressive ordinary dividend at the year end.

The lender said it has revised its guidance downward. It is no longer targeting a yearly capital build of 170 basis points to 200 basis points, and a statutory return on tangible equity of 12% for 2019.

The banking group joins a number of other financial services companies that have had to book unexpected charges relating to missold PPI-claims, including Royal Bank of Scotland Group PLC (RBS.LN) and CYBG PLC (CYBG.LN).

Write to Carlo Martuscelli at carlo.martuscelli@dowjones.com

(END) Dow Jones Newswires

September 09, 2019 02:37 ET (06:37 GMT)

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