Santander units apart one other £183m for the motor finance scandal – taking the overall invoice to just about half a billion

Santander UK has set aside another £183million to cover the cost of the car finance scandal – taking its total bill to nearly half a billion pounds.

The Spanish-owned bank added to the £295million it had earmarked for compensation and costs related to mis-selling of loans to vehicle buyers.

With £478million set aside, it said: ‘There continue to be significant uncertainties as to the nature, extent and timing of redress payments. 

‘The ultimate financial impact could be materially higher or lower.’ 

The finance scandal emerged after millions of customers were sold car loans with hidden commission.

Lloyds has set aside £1.95billion, while Close Brothers and Barclays are also on the hook.

Car finance scandal: Santander UK has added another £183m to the £295m it had already earmarked for compensation and costs related to mis-selling of loans to vehicle buyers

About 14m car finance deals could be eligible for compensation under proposals, with people estimated to get an average of £700 per agreement.

The update from Santander UK came as it reported a 14 per cent increase in pre-tax profits to £1.51billion for 2025.

It also set the scene for more cost-cutting in 2026, less than a week after it revealed plans to shut 44 branches, putting nearly 300 jobs at risk.