‘On our knees’ TSB gives sweeteners to customers

TSB chief executive Paul Pester on Thursday admitted the bank is “on its knees” but insisted it would fight back to challenge the big five.

As the computer meltdown crisis dragged into a sixth day, Pester said TSB will waive all overdraft fees and interest charges for retail and business customers for the month of April.

That is likely to cost it £10 million, “the last thing I am worried about”, said Pester.

The interest rate on the Classic Plus account will be raised to 5%, to say “thank you” to customers.

Pester said the move to a new IT platform at the weekend had been “incredibly bumpy”, but the bank was working around the clock to fix the systems. Asked if he would waive his bonus this year, he said: “That’s not my decision, that’s for the board and the remuneration committee.”

He was paid £3.7 million in 2016, including bonus, and £1.8 million last year.

TSB is bringing in IBM to help straighten out the breakdown. Pester said he is taking direct control of the issue.

Asked how many customers he might lose, he replied: “I think customers know this is a fight worth fighting against the big banks. We are a bit on our knees at the moment, but we will come back.”

Customers still experiencing problems “must get in touch”, he said.

TSB claims its systems are now “up and running”. One customer, Alan Gale, tweeted: “Really? Why then does it keep telling me that the service is unavailable, just as it has done for the past 6 days now.

“If I can’t log in at 4am it certainly isn’t because everyone else is still up trying to do the same. A complete shambles is what it is!”

TSB also reported a 40% fall in first-quarter profits to £19.3 million, which it blamed on “temporary movements in normal hedging arrangements… driven by market-rate fluctuations”.

The bank has made much of its plan to be a simple, straightforward bank that does not do fancy investment banking or complex financial deals.

Customer deposits grew 3% to £31 billion, while lending was flat, also at £31 billion.