By Jonathan Davies

The UK's biggest banks have used 60% of their profits to pay fines and compensation over the last four years, according to accountants KPMG.

Royal Bank of Scotland (RBS), Lloyds, HSBC, Barclays and Standard Chartered's total bill for fines and compensation for things like the PPI scandal and so-called interest rate hedging products is £38.7bn since 2011.

And according to consumer group Which? the bill for PPI is now just under £25 billion.

KPMG also identified a problem with bank's cost of capital. Their return on equity, a measure used to show how much money they are making for their investors, is currently below the cost of capital - something investors demand in return for the risk of investing in the banks.