TSB 'on its knees' over online banking fiasco says boss

(c) Sky News 2018: <a href="http://news.sky.com/story/tsb-on-its-knees-over-online-banking-fiasco-says-boss-11347650">TSB 'on its knees' over online banking fiasco says boss</a>
 

TSB boss Paul Pester has admitted the bank is on its knees as it struggles to recover from an online banking meltdown - and said it has taken a £10m hit to try to mitigate the impact on customers.

Mr Pester also said he had taken personal charge of the crisis, six days after disruption began when the lender launched a botched switchover of customers between IT platforms.

The chief executive has been ridiculed on social media after he tweeted that services were back "up and running" at 4am on Wednesday - hours before having to admit that online banking was still only running at 50% capacity.

He told Sky News: "We have tripped up big time, we are on our knees. We will get back up, we will come back."

Mr Pester said he still could not give a firm date on when the problems would be fixed.

He appeared to blame the IT team working on the problem over his 4am tweet, saying he had wanted to tell customers services had returned as soon as possible only "to find out that is not the case".

Mr Pester has repeatedly apologised over the fiasco and admitted that the time taken to fix the problems has been "unacceptable", while reassuring those affected that they will not be left out of pocket.

A growing number of customers have reported desperate circumstances as a result of being unable to access funds.

TSB sought to mitigate some of the anger by waiving overdraft fees and interest charges for April as well as hiking interest rates on some savings accounts.

Mr Pester said this effectively meant it was passing £10m back to customers in April alone.

The bank, owned by Spanish lender Sabadell, was under fresh scrutiny on Thursday as it reported first quarter results showing a 39% fall in pre-tax profits to £19.3m.

Announcing the results, TSB revealed that it had called in experts from IBM (NYSE: IBM - news) to help resolve continuing "performance" problems with new servers.

Mr Pester told Sky (Frankfurt: 893517 - news) 's Adam Parsons it was "super frustrating" that the problem - which seemed relatively straightforward - had not been resolved.

The underlying "engine room" of the bank - operating standing orders, direct debits, credit and debit card payments and cash machines - was working smoothly, he said.

Mr Pester said systems had been unable to cope with the volume of customers even though it had been made clear to IT service providers at Sabadell the scale of capacity that would be needed.

He said: "All the assurances we had in the run-up to this led us to believe this was more than capable of supporting the volumes that we are seeing."

TSB has five million customers including 1.9 million who use its website or app for banking.

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