According to a new study released by an independent think-tank legal cases and fines have cost British banks almost 53 billion pounds over the period of 15 years.
As banks have attempted to shore up capital reserves their efforts have been held back stopping them from lending more to customers and lowering dividends to shareholders.
Some of the scandals which have been most recent include the manipulation of major benchmark rates, foreign exchange markets and mis-selling PPI costing banks billions. The miss-selling of PPI is estimated to have cost banks more than 37.3 billion alone, the biggest consumer scandal ever to happen in the UK.
Despite many shareholders receiving no dividends it has been identified that the banks have continued to offer staff significant bonuses which amount to billions according to the study by the independent think-tank New City Agenda.
John McFall, a director of New City Agenda and former Treasury Committee chairman said:
“The profitability of UK retail banks has been imperilled by persistent misconduct.”
He also went on to say this had a knock on effect for everyday people as pension funds have been hit by the erosion of the value of the banks. In addition, as tax payers bailed out the banks during the financial crisis, the fines are effectively coming out of the pockets of the public.
Lloyds Banking Group (LON:LLOY) earmarked 14 billion pounds to pay for fines associated with misconduct between the years of 2010 and 2014, nearly twice what other lenders had put aside.