Barclays (BARC.L) has accepted defeat in the payment protection insurance (PPI) legal battle after setting aside £1 billion for future redress.

The news came as the British Bankers' Association announced it would not appeal a High Court judgement on the handling of PPI complaints

The bank has agreed with City regulator the Financial Services Authority that it will begin to process all 'on-hold' and new PPI complaints

Bob Diamond, chief executive of Barclays, said 'We have taken this decision because it is in the best interests of our customers, as well as for Barclays and its shareholders; creating certainty, particularly regarding past issues, is of benefit to all parties.

'We don't always get things right for our customers; when we get them wrong, we apologise and put them right. That's our commitment to our customers, and it applies to the way in which we will deal with PPI complaints.'

Barclays had earlier this year in its final results that it was 'not practicable' to provide an estimate of the financial effects until a final ruling had been decided.

To receive more relevant articles like this one, why not sign up to our weekly newsletters, click here