Lloyds sets aside further $2.2 billion for mis-selling redress

LONDON, July 31 (Reuters) - Lloyd Banking Group said it had set aside a further 1.4 billion pounds ($2.2 billion) to compensate customers mis-sold loan insurance, taking its total bill for the scandal to 13.4 billion pounds.

Lloyds reported a first half statutory profit of 1.2 billion pounds, up 38 percent but below analysts' expectations of 1.9 billion as a result of the additional charge to for mis-sold payment protection insurance (PPI).

The bank also said it would consider returning capital to shareholders through one-off dividends or share buy backs from the end of this year if its core capital is higher than 12 percent plus the equivalent of one year's dividend payment. ($1 = 0.6408 pounds) (Reporting by Matt Scuffham, editing by Sinead Cruise)