TSB owner counts the cost of IT meltdown with new £78m charge
The Spanish owner of crisis-hit TSB has taken another 88 million euros (£78 million) hit linked to the bank’s IT meltdown, which caused chaos for thousands of customers.
Sabadell revealed the provision as part of its third-quarter results on Friday.
It comes on top of a 203 million euro (£180 million) charge it booked in the second quarter.
In April, IT woes at TSB left up to 1.9 million people users of TSB’s digital and mobile banking locked out of their bank accounts.
The tech troubles were triggered by a migration of customer data from former owner Lloyds’ IT system to a new one managed by Sabadell.
It has suffered enduring IT issues since then, with TSB forced to apologise last month after many customers were again left unable to access their accounts.
The extra costs contributed to Sabadell’s third quarter net profit sliding 37% 127.2 million euros (£113 million).
It comes just days after figures showed thousands of TSB customers switched away from the bank between April and June as the repercussions of its IT meltdown were felt.
Figures for the second quarter of 2018 show TSB suffered a net loss of 16,641 current account switches – with 5,149 switches being made to the bank during the second quarter of 2018 while 21,790 customers moved away.
Since the meltdown TSB has parted company with boss Paul Pester, ending his seven-year stint at the top of the lender.
The bank insisted the decision for Mr Pester to leave was by “mutual agreement” and denied his departure was linked to the IT migration failure and ongoing investigations.