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MPs have ‘lost confidence’ in TSB boss over IT disaster

LONDON (Reuters) – The chairman of TSB mentioned on Thursday the financial institution’s chief govt, Paul Pester, had the total assist of the board, after Pester got here beneath assault from MPs over his dealing with of an IT disaster, casting doubt on his place.

FILE PHOTO: Chief Executive of the TSB financial institution, Paul Pester, poses on the financial institution’s Baker Street department in London September 9, 2013. REUTERS/Andrew Winning

Parliament’s Treasury Committee mentioned earlier on Thursday it had “lost confidence” in Pester and questioned whether or not he ought to stay in his put up. The IT outage left 1000’s of shoppers with out entry to accounts and unable to make very important funds.

TSB Chairman Richard Meddings’ response urged Pester would stay on the financial institution for now, noting Pester’s progress in resolving the IT points.

“This progress has been achieved under the leadership of Paul Pester, who continues to have the full support of the TSB Board,” Meddings mentioned in an announcement on Thursday night.

The politicians can not immediately affect whether or not Pester is sacked. That resolution rests with the financial institution’s board.

In letters to Meddings, the Financial Conduct Authority and the Prudential Regulation Authority, the chair of the Treasury Committee, Nicky Morgan, mentioned the committee was expressing no opinion on who was accountable for the IT disaster however 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 mentioned in an announcement.

In her letter to Meddings, Morgan listed cases the place the TSB boss had both omitted data or made statements the committee deemed inaccurate, and didn’t take alternatives to right his statements.

FILE PHOTO: An indication is displayed exterior a department of the TSB financial institution in central London March 12, 2015. REUTERS/Neil Hall/File Photo

“Whether intentionally or not, he has not been straight with the committee and … TSB’s customers,” she mentioned.

Treasury Committee members known as such public criticism of a serving financial institution CEO “unprecedented”.

The PRA and FCA declined to remark.

“I have never seen such unanimity in the Committee. Each and everyone came to the same conclusion,” mentioned Labour occasion lawmaker and committee member John Mann on Twitter.

TSB’s Spanish proprietor, Sabadell, mentioned earlier on Thursday the disaster had to date price about 70 million kilos, primarily from a waiver of overdraft charges and compensation for instances of alleged fraud linked to the IT issues.

Sabadell declined to touch upon the MPs’ criticisms of Pester.

In his second look in entrance of the committee on Wednesday, Pester was compelled by one lawmaker to confess he had been unaware of significant issues with the financial institution’s fraud helpline throughout his first look, the place he mentioned most points had been resolved.

Additional reporting by Kirstin Ridley, modifying by Edmund Blair, Larry King


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