Barclays defies profit expectations despite forking out a £600 million bill for misselling PPI

James Jes StaleyGettyJames ‘Jes’ Staley, CEO of Barclays.

Barclays defied analyst expectations by reporting a pretax profit of £837 million despite taking a huge hit from paying compensation for those it missold payment protection insurance (PPI).

Barclays confirmed in its third quarter interim results that it took a £600 million hit related to PPI misselling.

PPI was a form of insurance intended to pay out if consumers failed to make payments on their loans. Many consumers were duped into buying it, or did not know how it worked.

PPI was wrongly sold alongside loans, credit cards and mortgages and banks have been forced to pay out to customers who were wrongly sold the coverage.

The results come only a day after the bank agreed to settle a lawsuit in the US over Libor fixing.

While the terms were not disclosed, Reuters reported that that the case was settled after a class action lawsuit claimed that Barclays and 15 other banks “artificially low returns on more than $500 billion of dollar-denominated debt whose interest payouts were linked to Libor.

This story is breaking and is in the process of being updated.

Visit Markets Insider for constantly updated market quotes for individual stocks, ETFs, indices, commodities and currencies traded around the world. Go Now!

NOW WATCH: Ex-Wells Fargo employees reveal how some bankers abused customers

NOW WATCH: Money & Markets videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at research.businessinsider.com.au.