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TSB lends £1.2bn in Q1 as IBM called in for IT rescue

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  • 26/04/2018
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TSB lends £1.2bn in Q1 as IBM called in for IT rescue
Besieged lender TSB has drafted in IBM to help fix its IT meltdown, which has left customers struggling to access basic banking services for almost a week.

 

 

The IT giant is to support TSB in resolving issues, the bank said, as it reported Q1 2018 results with a grovelling apology for the systems mess from chief executive Paul Pester.

Profit before tax fell 39.3% to £19.3m in the first three months of the year compared to the same period last year, which TSB largely blamed on temporary movements in hedging arrangements.

The lender said it advanced £1.2bn of new mortgage loans in the first quarter of 2018, building on the £7bn gross lending advanced in 2017.

The results were mostly overshadowed by the bank’s IT problems.

Last weekend TSB moved 5 million of its customers to a new banking platform, but in the following days customers were locked out of accounts, and in some cases reported access to different customers’ details.

Pester said most customers should find everything is now running smoothly but teams continue to work “around the clock” to fix the systems that are not running as well as they should be.

 

Customers not left out of pocket

The bank promised that customers will not be left out of pocket following the issues and is waiving all overdraft and interest charges for retail and small business customers in April.

TSB said it will also raise its interest rate on its classic plus account to 5%, as a way of saying “thank you to our customers for sticking with us”.

Pester said: “As we moved over to our new banking platform last weekend, the landing was an incredibly bumpy one for our customers, and for that I am truly sorry.

“This is not the level of service that we pride ourselves on providing – nor is it what our customers have come to expect from TSB.

He added: “We have achieved a tremendous amount in the past four years in building TSB.

“We clearly have some issues we’re dealing with but we will come out the other side.

“The way we deal with every single one of our frustrated customers as quickly as possible will define TSB – both now and in 10, in 15 and in 20 years to come as we continue on our mission to bring more competition to UK banking.”

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