Mis-selling review at Lloyds TSB

LLOYDS TSB has been snared in a new mis-selling review over the way it sold high-income bonds last year.

The bank may have to compensate thousands of investors who bought its Extra Income and Growth Plan, without having the risks fully explained to them. Falling stock markets have since wiped millions of pounds off the value of these plans.

Lloyds TSB is working with the Financial Services Authority to review thousands of its sales. Financial Mail understands that the regulator is also examining sales made by other companies as part of a wider-ranging investigation into high-income products.

Lloyds TSB confirmed the review. It said: 'We're unable to comment on how we're working with the regulator.'