FCA to investigate TSB over IT issues
TSB is facing an investigation by the Financial Conduct Authority (FCA) following the bank’s recent IT failure.
The migration of customer information to a new system in April affected millions of customers across the UK and left users unable to log in to their accounts, make transactions and, in some cases, able to see information about other customers.
But while TSB said its systems were up and running again after the issues, the FCA said the bank’s chief executive Paul Pester had given an “optimistic view” of its service capability.
“The numbers are arguable, but in my view greater caution would have made sense,” FCA chief executive Andrew Bailey said in a letter to the Treasury Committee.
“Jointly with the Prudential Regulation Authority (PRA), we will undertake an Investigation using our statutory powers into TSB’s IT migration,” Bailey added. “We do not normally make this information public, but given the level of public Interest, I want to be clear that we will be conducting this work.”
He added that poor communication and response times to calls from customers may have undermined consumer trust in banking.
The issues stem from when TSB split from Lloyds Banking Group. It continued to rent a banking platform from Lloyds while it constructed its own, Proteo4UK.
That system was intended to go live over the weekend of April 21 and 22 as it moved its customers’ data from the old platform to its new one.
Some TSB customers are continuing to experience problems accessing their accounts, six weeks after it sought to make the switch.
Appearing before the Treasury Committee in April, Pester said login success rates on the TSB’s app and website were around 95 percent, a typical level for most banks.
In a letter to the committee, the FCA’s Bailey said that view was optimistic and too positive, adding that Pester should have shared more details about the problems with MPs on the committee.
A TSB spokesperson said: “We look forward to updating the committee on the work TSB has undertaken to resolve problems for customers since our last appearance. We recognise that we have more to do to restore the bank’s operations to the level that customers expect and are completely focused on that and ensuring customers are not left out of pocket.”