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TSB’s IT meltdown costs £176m as mortgage lending sinks

  • 27/07/2018
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TSB’s IT meltdown costs £176m as mortgage lending sinks
TSB swung into a loss in the first half of 2018 after IT chaos earlier this year cost the bank millions, while new mortgage lending at the bank also suffered.


The lender insisted its mobile app, online banking, and branch service levels have improved after the botched switch to new systems in April left millions of customers without access to basic banking services.

Waived overdraft and interest charges, as well as customer compensation cost TSB’ £176.4m in the first half.

The bank reported a loss before tax of £107.4m, from a profit of £108.3m last year.

TSB advanced £2.6bn of new mortgages in the six months to the end of June, sinking from £4.1bn in the same period last year.

However, total customer lending over the six months was £31bn, up 2.8% year-on-year,

Focus at the bank is on minimising future service interruptions for customers, TSB said in a results statement today.


Putting things right

The lender has promised no TSB customer will be left out of pocket as a result of IT issues.

And a dedicated team to look at every customer complaint on an individual basis has been set up.

Around 26,000 customers switched their bank account away from TSB in the second quarter of the year, although more than 20,000 customers opened a new bank account or switched their account to TSB.

Paul Pester, TSB chief executive (pictured), said: “We’re making progress in resolving the service problems customers experienced following our IT migration, and we will continue to work tirelessly until we have put things right.

“I know how frustrated many customers have been by what’s happened.

“It was not acceptable, and was not the level of service that we pride ourselves on – nor was it what our customers have come to expect from TSB.

“Our priority in the second half of the year continues to be putting things right for our customers.

“Looking further ahead we are determined to get back to bringing more competition to UK banking and ultimately making banking better for consumers and small businesses.”

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