TSB boss quits after IT disaster

TSB boss Paul Pester yesterday stood down after seven years in charge – leaving behind an ongoing IT fiasco and thousands of customers seeking compensation.

Pester will receive a £1.7million payout comprising £1.2m in severance pay and a “historical” bonus of around £480,000, due from TSB’s takeover by Sabadell in 2015.

Chairman Richard Meddings will take on the role of executive chairman and immediately lead the hunt for a new boss. He insisted that he and Pester had “mutually agreed” it was the right time for him to leave. It is understood the decision has been discussed over the last few weeks.

The bank’s woes began in April when it tried to migrate customer data from its old Lloyds’ IT system to one managed by Sabadell.

A botched operation left up to 1.9 million TSB customers unable to access their online and mobile banking services.

In its most recent results, the bank said that the failure had cost it £176million in compensation and other costs. It has received more than 135,000 complaints since migration, but only 37% of them have been resolved.

It has suffered constant IT issues since then, with TSB forced to apologise this Monday after many customers were again left unable to access their accounts.

Meddings insisted that the technology failures had not led to Pester’s departure. “He is not the fall guy,” he said.

However, Nicky Morgan, chair of the Treasury Committee, said: “Since the IT problems at TSB began, Paul Pester set the tone for TSB’s complacent and misleading public communications.”

Gareth Shaw, Which? Money Expert, added: “This is an opportunity for TSB to finally get to grips