Too many cooks

8 June 2018 By Aimee Donnellan Follow @aimeedonnellan

A British parliamentary committee has called for the bank’s boss to be fired, after protracted IT problems. The move risks undermining separate investigations by regulators. Removing Paul Pester now wouldn’t help TSB customers, and could even make the situation worse.

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A British parliamentary committee said on June 7 that it had “lost confidence” in the chief executive of TSB bank. Its statement said it questioned whether Paul Pester should remain in his post, following problems with the bank’s IT systems that have left thousands of customers without access to their accounts.

TSB Chairman Richard Meddings responded by issuing a statement saying that Pester had made progress in resolving the IT issue, and that he had the full support of the bank’s board, Reuters reported.

In letters to Meddings, the Financial Conduct Authority and the Prudential Regulation Authority, and the chair of the parliamentary Treasury Committee Nicky Morgan, said the committee was expressing no opinion on who was responsible for the IT crisis but on Pester's response afterwards.

“Since the IT problems at TSB began, its public communications have often been complacent and misleading. This tone has been set from the top,” Morgan said in the statement. “Whether intentionally or not, he has not been straight with the committee and ... TSB's customers,” she said.

TSB's Spanish owner, Banco de Sabadell, said earlier on June 7 the crisis had so far cost the bank about 70 million pounds ($94 million), mainly from a waiver of overdraft fees and compensation for cases of alleged fraud linked to the IT problems, Reuters reported.

The PRA and FCA declined to comment, Reuters said.

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