Watchdog warning over Co-op Bank’s ageing computers
THE Co-operative Bank faces fresh embarrassment after markets watchdogs criticised it for failing to give customers clear enough information about overdraft charges.
The institution, which was rescued from heavy debts by its lenders this year, has been slapped on the wrist by the Competition and Markets Authority (CMA) over its aged IT systems.
Banks are required to tell customers the maximum charge they face each month for unauthorised use of their overdraft. Co-op Bank missed the Aug 2 deadline because its computers only generate quarterly data. The bank now has six months to update its systems or it will be hauled into court.
The bank’s previous IT problems include writing off almost £150m when it abandoned an unfinished overhaul, and struggles to satisfy regulators that its systems could recover from a serious crash, cyber attack or other disaster.
The CMA expects the bank will have to compensate around 1,300 customers who have ended up out of pocket because of the lack of clear information.