Paul Pester resigns as CEO of TSB following new round of IT outages

Repeated IT failures force out TSB CEO Paul Pester

TSB CEO Paul Pester has resigned following another round of IT outages at the beleaguered bank.

Pester had been CEO for seven years, but was criticised for his role in the bank's mismanaged banking platform migration in April, which left some customers without access to their accounts for more than a week.

The bank's handling of the crisis was so poor that Pester was called to testify before the House of Commons Treasury Committee - twice. Pester blamed middleware for the IT problems "causing issues with the throughput of data".

Many observers, though, blamed a lack of thorough preparation and testing prior to the platform migration.

MPs branded TSB "the Truly Shambolic Bank" in June. Pester, meanwhile, admitted that at least 1,300 people had been defrauded following the IT migration meltdown, although only 12,500 people had closed their accounts. The IT meltdown has cost the bank £176.4 million, according to the bank's interim accounts published in July, pushing it into a £107.4 million pre-tax loss for the six months to the end of June.

That outage was compounded this weekend when a four-hour window of planned downtime in the early hours of Saturday morning lasted all weekend, leaving customers unable to access their accounts via the bank's mobile apps or online banking.

"Although there is more to do to achieve full stability for customers, the bank's IT systems and services are much improved since the IT migration," chairman Richard Meddings said in a statement.

Meddings continued: "Paul and the board have therefore agreed that this is the right time to appoint a new CEO for TSB. Our goal is therefore to allow a full search to commence, without any distractions, enabling TSB to build for the future."

TSB was sold for £1.7 billion by Lloyds Bank to Spain's Banco Sabadell in 2015 for £1.7 billion. The IT platform migration was driven by TSB's parent bank in a cost-saving move.

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