Lloyds Banking Group's chief executive, Charlie Nunn, was put under the spotlight by the Treasury Select Committee on Tuesday regarding the bank's historical involvement in the motor finance market.
Nunn defended the bank's operations in the car financing sector, stating there was "no evidence of harm."
The controversy surrounding the sector escalated to the Supreme Court in early April as lenders sought to overturn the Court of Appeal's ruling that it was unlawful for banks to pay a commission to a car dealer without the customer's informed consent, as reported by .
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Nunn anticipates a verdict from the country's highest court in July.
The Financial Conduct Authority (FCA) has committed to implementing an industry-wide redress scheme within six weeks if the lenders receive an unfavourable ruling.
Industry analysts predict significant repercussions across the banking and broader financial services sector if the Supreme Court upholds the Court of Appeal's judgment.
However, Nunn maintained that Lloyds "don't have evidence of harm, or that we've broken regulation."
He suggested that the "Court of Appeal seems to be at odds with 30 years of legislation" and called for "clarity" in the court's judgment.
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"Without clarity it will create dysfunction in the market," he cautioned.
Barclays have hundreds of staff dedicated to handling motor finance complaints.
Lloyds is at the forefront when it comes to provisions set aside for the motor finance scandal, with £1.2bn reserved.
Barclays has set aside a hefty £90m. The bank's 海角视频 chief, Vim Maru, addressed the spike in complaints related to motor finance, despite the fact that Barclays exited this market back in 2019.
He highlighted that some of these complaints stretch back two decades, making them "harder" to tackle.
Maru revealed that Barclays had "a few hundred staff dedicated to this to deal with processing and in preparation of supreme court decision when further enquiries come".
Analysts at RBC Capital have estimated that the total compensation bill for the motor finance scandal could skyrocket to as much as £32bn.
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In their base case scenario, they predicted the banking sector could be liable for £5.9bn. However, this figure could potentially double to £10.8bn in a downside scenario.
If the situation spirals into a 'worst case' scenario, Lloyds could be hit with a staggering £4.6bn blow.
Despite the mounting provisions, Nunn noted there had been "no material changes in consumer behaviour".
He concluded: "It will all depend on the specifics of the decision."