Lloyds and Barclays Top Ombudsman’s Complaints List

According to the website of the Financial Services Ombudsman, the “Complaints data on financial businesses” is the focus of the week. The Ombudsman placed the Lloyds Banking Group on the top of its “black” list, thus causing immediate reaction from the bank’s management. According to the data released by the Ombudsman, the Lloyds Banking Group accounts for as many as 15,233 customer complaints reported to the Financial Services Ombudsman in the first 6 months of 2009. The figure is almost double of that of Barclays (9,056), which takes the 2nd place. The immediate reaction from the management of the Lloyds Banking Group was not surprising: the bank said that it was positioned on the list unfairly because of 2 reasons. First and foremost, the number of the Lloyds Banking Group customers exceeds that of any other British lender as the Lloyds Banking Group took over HBOS. Second, only 6,947 complaints were reported against Lloyds TSB; the remaining 5,804 complaints were against the Bank of Scotland. However, the Lloyds Banking Group top ranked not only in terms of the number of complaints. It also had one of the largest proportions of upheld complaints, 82%, which compares to 59% average. Bank’s finance unit Black Horse and insurance unit Lloyds TSB Insurance Services had 95% and 92% of upheld complaints accordingly. Another business that “outperformed” the Lloyds Banking Group in terms of upheld complaints was a British mortgage broker, Loans. co.uk, which had as much as 93% of complaints upheld. Other lenders that topped the “black” list of the Ombudsman in terms of upheld complaints were Barclays Bank (71%), Royal Bank of Scotland (71%), and Abbey National (67%). According to the Chief Ombudsman, Mr. Walter Merricks, the banks themselves are to blame for the depressing list as they failed to comprise a better comparison when they were given the time to do so. Moreover, their failure to share private data resulted in no improvement in the complaints handling standards.