TSB chief executive is not out of the water yet...
PAUL PESTER is fighting a last-ditch battle to save his job as chief executive of troubled bank TSB following the IT meltdown that has already cost the lender £70million.
The bank’s calamitous move on to a new IT platform left 1,300 customers the victims of fraud. The fiasco was still causing strife this weekend – seven weeks after the problems began.
The bank wants Pester to stay on until the debacle is sorted out, but few in the City expect him to survive the furore in the long-term.
MPs on the Treasury Select Committee called on Thursday for him to step down, saying that if he continued it could damage trust ‘in the retail banking sector as a whole’.
They said Pester had ‘not been straight’ with them and that he had implied the problems were fixed when they were not.
The bank appeared to be on a collision course with MPs last night as supporters of Pester accused the committee of overstepping its remit.
His defenders believe he is being scapegoated. They point out that MPs have never before scrutinised similar IT issues at other lenders in such detail or called for bosses’ heads to roll.
An internal team has compiled a dossier analysing the committee’s behaviour towards other bank chief executives and it has concluded that Pester has been harshly treated.
Friends of Pester argue that he will be vindicated by official investigations into the saga.
The bank has blamed Sabis, the IT arm of its Spanish parent Sabadell, for the meltdown.
Privately, sources have talked about legal action against Sabadell. One said: ‘A bunch of Spanish numpties’ has been blamed for ‘trashing’ the bank.
But Financial Conduct Authority boss Andrew Bailey firmly rejected what he called ‘finger-pointing’ last week, saying senior managers should take responsibility.
Bailey indicated that the FCA would be looking into whether TSB had tested the new software to see whether it worked with the bank’s other systems.