Page 224 - Flip Banks TG

What Went Wrong Issue 2

What went wrong?

“We have created a more digital, agile and flexible TSB”

Paul Pester (1)

The crisis at TSB provides an insight into the problems
presented by the sheer complexity of many banking IT

system, and especially, the difficulty involved in adapting

and changing them.

The banks’ IT systems have generally been organically grown

and as such tend to be complex structures after consistent

development and component re-platforming.

Consequently, any kind of upgrade or transition was likely to

be extremely difficult. It is little surprise therefore,

customers were locked out of their accounts and

experienced money disappearing from accounts. Some

were even able to see other customers’ accounts.

TSB’s continuing IT problems came under fierce criticism

with MPs on the Treasury Committee calling on Pester to

resign. This was followed in June, by the Financial Conduct

Authority launching a formal investigation into the

meltdown.

Problems flared up in both August and September which finally resulted in Pester resigning.
However, he might well feel that he was a victim of circumstances beyond his control after all the
new system was built, designed and tested by Sabadell, TSB's Spanish owners who were convinced
the system was ready. A claim questioned by IBM who were called in to deal with the crisis saying
that the system had not been tested sufficiently.