Banks told to add IT expertise at board level
The current state of high street banking IT systems is not up to scratch and the chief executives of Royal Bank of Scotland, HSBC and Barclays, as well as the heads of the Bank of England's regulatory arms, have been told to urgently begin addressing the matter from board level downwards.
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MP Andrew Tyrie, chairman of the Commons' Treasury Committee, said Andrew Bailey, Deputy Governor of the Bank of England and chief executive the bank's Prudential Regulation Authority (PRA) should lead official efforts to enforce banks to bring their computer systems up to scratch.
The downing of the HSBC online bank earlier January follows a similar system failure at Barclays in October, while RBS was fined £56m by the BoE just over a year ago for computer failures that hit more than over 6.5m UK customers for several weeks.
“Every few months we have yet another IT failure at a major bank," Tyrie said on Sunday. "These IT blunders and weaknesses are exposing millions of people to uncertainty, disruption and sometimes distress. Businesses suffer, too. We can’t carry on like this."
The Committee has written 21 letters between June and November 2015, including to Martin Wheatley, then chief executive of the FCA, to ask questions on reports that some RBS customer payments had gone ‘missing’; to Barclays chairman John McFarlane for further detail on the problems facing customers trying to access banking services in October; to HSBC CEO to Antonio Simoes, about delayed payments to customers last year.
Tyre added: “Bank IT systems don’t appear to be up to the job. This brings with it not just conduct risk, but also systemic risk. Someone - probably the head of the PRA, needs to assume a leadership role, bring together those most involved among regulators and government agencies, and ensure that there are improvements at the banks.
"Until these are made, the public will remain more exposed than necessary to the risks of banking failures, including delays in paying bills, an inability to obtain their own money, and unauthorised access to their accounts.”