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Teflon TSB rides out online banking fiasco

The really fascinating bit about TSB's results was not the whacking loss, nor the expressions of regret, nor the vast sums being set aside for compensating customers, sorting the problems or investigating what went wrong. 
No, the really extraordinary bit was the extent to which, despite as much bad publicity as a bank could ever fear, that customers don't seem that bothered.Around 26,000 people did leave the bank but, at a time when TSB's reputation was being dragged through the mud, 20,000 people actually signed up to join TSB.That net loss of 6,000 customers is very similar to the position it faced in the first quarter of the year, before the computer problems hit.:: TSB makes €107.4m loss over notorious IT meltdownWhat's more, the bank now manages more current account deposits than it did before its computer system fell over.Ironically, for a company that has always tried to persuade customers to ditch the big banks and switch to them, TSB seems to be benefiting from our longstanding trend of inertia - even when confronted with the sort of shambolic failure that TSB suffered, few of us can be bothered to switch banks.
Teflon TSB rides out online banking fiasco

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May 2018: Pester faces backlash over TSB crisis
So what we have are three stories in one.Firstly, TSB's slide into the red, caused entirely by the €176m it has set aside to pay compensation, investigate the problems, or to cover lost revenue. A nine-figure profit has turned into a nine-figure loss. There could be more costs to come, assuming that regulators impose big fines.Then there's the question of the ongoing fallout from the IT failure. TSB commissioned an independent inquiry to be carried out by the law firm Slaughter and May, to find out what went wrong, and why. I'm told that inquiry is unlikely to conclude until the early months of next year.The Financial Conduct Authority is also holding its own investigation into the circumstances of the failure, while the Treasury Select Committee produced a caustic report that overtly called for the sacking of TSB's chief executive, Paul Pester.
It was a demand that was both ignored, and criticised, by the board of TSB.Mr Pester has not spoken publicly following these results, although the bank does quote him as saying "it has been a difficult time for customers...and we will continue to work tirelessly until we have put things right".I understand he is determined to continue leading the bank through its recovery and also to repair the bruised relationship between TSB and its Spanish parent, Sabadell.During the height of the system failure, Mr Pester told Sky News that he had had "robust conversations" with Sabadell about the way it had responded to the crisis. But I understand the tension has now eased, not least because of the amount of resource Sabadell has provided to help analyse and solve problems.Sabadell's financial results have also been tarnished by the fallout from the TSB fiasco.The third element of these results, though, is the one that will get the least attention.On an underlying basis, TSB appears remarkably healthy. Its customer base is loyal, its capital position is strong and its deposit base is going up.
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Strip out the effects of the IT failure, and it's done quite well. Which may be little comfort for those suffering from fraud, late payments and Olympic levels of frustration, but it is a fact.For a bank that's still dealing with one of the worst, and most-publicised corporate crises of recent years, TSB seems surprisingly robust.
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