PPI setback

Rebranded Virgin Money to make maiden annual loss

Virgin Money flag 2

Rebranded bank will report a loss (pic: Terry Murden)

Virgin Money UK, the renamed owner of Clydesdale Bank, formerly known as CYBG, will follow the pattern of other banks this week and confirm that payment protection insurance claims have carved a big hole its annual accounts.

The bank, which has adopted its new name under licence from Sir Richard Branson, is expected to reveal a £254 million loss as claimants rushed to beat the August deadline for mis-sold PPI policies.

Tougher competition in the mortgage market is also expected to contribute to a 2% drop in revenue to £1.65 billion for 2018/19.

CYBG acquired Virgin Money for £1.7bn last year and has ditched its Clydesdale and Yorkshire bank brands following customer research showing Virgin to have greater appeal.

Full-year profits at Lloyds were almost wiped out as it took a £1.8bn hit from PPI and Royal Bank of Scotland swung to a loss after suffering a £900m setback.

On a positive note, the surge in late PPI claims will not be repeated, allowing the banks to report cleaner accounts for the current financial year.

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