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TSB CEO Paul Pester and the bank’s chairman Richard Meddings will appear before a parIiamentary select committee to explain what went wrong when the bank migrated millions of customers to its new core banking platform.
The Treasury Committee, chaired by Nicky Morgan MP, will also quiz a representative from Spanish bank Sabadell, which owns TSB.
On Friday 20 April, TSB began transferring millions of customer accounts to its new core banking platform, but customers were soon hit with major problems, including being unable to access accounts, money appearing and disappearing, and customers being able to see other people’s accounts.
The problems happened when TSB moved customer accounts from the systems of Lloyds Bank and to its own core platform, known as Proteo4UK, a UK version of the core banking system developed in-house by Sabadell.
When Sabadell acquired TSB in 2015, it said it would move customers to a new banking platform, and has been planning the transfer ever since. The plan was to move customers across in stages, and Proteo4UK was rolled out to the bank’s staff in November 2017 with a full range of banking services.
The bank said the migration would not only save it £160m a year, but would enable it to build its own digital services in an industry where customers increasingly want digital banking services.
But moving millions of customer accounts to a new system from legacy systems is a huge task that requires thousands of things to happen correctly and at the right time. For example, a single mortgage product relies on interactions between hundreds of systems to work.
But MPs will demand more than detail on what went wrong. Morgan has been vocal on the IT disaster and made clear that the government will expect answers to its questions about why it happened. She said last week that “warm words and platitudes will not suffice”.
Morgan added: “The Treasury Committee is extremely concerned by the problems at TSB, and by the apparent miscommunication to customers about the extent and nature of these problems. We will take evidence from TSB and Sabadell representatives to find out how they got into this mess, who is responsible, and how they are putting it right.”
As the disaster enters its second week, TSB has hired IBM to help it fix the problems. In its latest update, the bank said internet banking, business banking services and its mobile app were available again, but admitted: “Some customers may still have difficulties accessing and using these services. We are working hard to address these issues.”