TSB chief executive Paul Pester is to step down as a result of the major IT problems that have dogged the bank since April.
Almost two million TSB customers lost access to online banking services after the introduction of a new IT system failed.
The problems left customers unable to access their accounts or make payments, while others were shown incorrect information, and in some cases the details other people’s accounts.
The issues stemmed from when TSB split from Lloyds Banking Group. It continued to rent a banking platform from Lloyds while it constructed its own, Proteo4UK.
That system was intended to go live over the weekend of April 21 and 22 as it moved its customers’ data from the old platform to its new one.
The bank is still struggling to get its IT systems to work properly and on Monday (September 3), it again apologised to customers who faced disruption to their online and mobile banking over the weekend.
In July, the bank revealed the IT issues had cost it £176.4m, pushing it into a loss of £107.4m in the six months to June 30.
Pester’s departure brings his seven-year spell as chief executive of TSB to an end. Richard Meddings, current non-executive chairman of TSB, will take on the role of executive chairman with immediate effect until a new chief executive is found.
Meddings said: “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. 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.”
Following the disruption caused by the IT problems, Pester faced calls from MPs in the Treasury Committee to resign.
Nicky Morgan, chairwoman of the Treasury Committee, today (September 4) said it is right Pester is stepping down.
She said: "Since the IT problems at TSB began, Paul Pester set the tone for TSB’s complacent and misleading public communications. The Treasury Committee, therefore, concluded that it lost confidence in Dr Pester’s position as Chief Executive of TSB.
"But the committee remains concerned about the continuing problems at TSB, including unacceptable delays in compensating customers who have been badly let down. It is to be hoped that Dr Pester’s successor is able to restore the confidence of the bank’s long-suffering customers."
The failures are being investigated by the Financial Conduct Authority (FCA) and the Information Commissioner’s Office (ICO).