Lloyds Banking Group has said it will address "historic issues" in the taxpayer-backed bank after being fined a record £28 million from city regulator, the Financial Conduct Authority (FCA).
In a statement, Lloyds said:
"Lloyds Banking Group accepts the findings of an FCA investigation into its historic systems and controls governing bancassurance legacy incentive schemes for branch advisers, and has agreed to pay a fine of £28m.
"The Group launched its new strategy in 2011 to fully refocus the business on its customers. As part of that approach, the Group has been addressing historic issues and ensuring that customers get fair and appropriate outcomes.
"Lloyds Banking Group has co-operated fully throughout the enforcement investigation and has agreed with the FCA the next steps with regard to customers."
In a speech to assembled Lloyds Banking Group staff in Birmingham, Chancellor George Osborne thanked employees for putting up with "difficult decisions" and job restructuring since the 2008 government bailout.
This is the first payout for taxpayers following the 2008 bailout of Lloyds bank, which of course was carried out by the Labour government at the time and they're now claiming vindication of that policy.
However, taxpayers still have a significant stake of more than 30 per cent in Lloyds.
There's a political angle going on here too and the Chancellor, George Osborne, is trying to keep this momentum flowing in his party's direction following his recent speech in which he stated that the economy had turned the corner.
I think that what it shows is that our economy is turning a corner, that we are now in a position where overseas investors and others are looking to invest in British banks.
Given the massive commitment that the British taxpayer made to rescuing these banks when things went wrong back at the time of the financial crisis, I think that it is a welcome sign that we are starting the process, and of course it will be a long process, of getting the taxpayers' money back.