LLOYDS Bank was slapped yesterday with a record £117 million fine by the City regulator over the way it handled mis-selling complaints.

The Financial Conduct Authority (FCA) found that the banking group had wrongly denied compensation to customers over payment protection insurance (PPI) — the wider scandal that has already cost Lloyds £12 billion.

Between March 2012 and May 2013 the state-backed group assessed customer complaints relating to more than 2.3 million PPI policies of which 37 per cent were rejected — many of them wrongly.