![]() TSB is hoping to attract investors looking for exposure to Britain’s economic recovery from a bank which is untainted by issues of past misconduct. Lawmakers and banking regulators are keen to see new banks emerge to break the dominance of Britain’s biggest five lenders, which control more than three quarters of the personal current account market, and TSB is seen as a viable challenger. It subsequently revived the TSB brand, last seen on British high streets in the 1990s, with a view to a stockmarket sale. Lloyds had planned to sell the branches to the Co-operative Bank but that sale fell through last year when a 1.5 billion-pound funding gap at the Co-op emerged. Clothing chain Fat Face pulled its planned London listing last week while holidays-to-insurance firm Saga priced its IPO at the bottom of its original range. That reflects a cooling of investor interest in UK company flotations in recent weeks following a rush of activity earlier in 2014. However, the number of shares being sold in the initial offer is at the bottom end of expectations and banking industry sources said last week they expect them to be priced at less than TSB’s book value of 1.5 billion pounds ($2.5 billion), meaning Lloyds will make a loss on the sale of the 200-year old brand. It is also waiving overdraft fees and interest charges that resulted from the problems.Lloyds was forced by European regulators to sell the 631 branches which now form TSB as a condition of receiving state aid during the financial crisis five years ago and it must therefore now sell the whole of TSB by the end of 2015. In a bid to “put things right” following the chaos for customers, TSB is increasing the interest it pays to customers that use one of its current accounts. ![]() It is also expected to save the bank £160m a year in costs. If all goes to plan, Proteo4UK will support TSB in the digital banking age and enable it to challenge bigger banks by offering financial technology (fintech) services like some of the UK’s digital challenger banks do. ![]() Proteo4UK, TSB’s new core banking system, is a UK-specific version of Sabadell’s existing core banking system, Proteo. Sabadell, TSB’s current owner, continued to pay a couple of hundred million pounds a year to Lloyds until it migrated accounts to its own platform.Ĭoming off the Lloyds Banking Group systems was the plan from the moment Spanish Bank Sabadell acquired TSB in 2015. This was not only to save it £160m a year, but also enable it to build its own digital services. Lloyds systems had hosted TSB accounts from the time the banks were part of the same group and TSB was using the same system. TSB CEO Paul Pester told BBC Radio 4: “I will take direct control from eight o’clock this morning for our platform, and I’ve drafted in a team of global experts from IBM.” ![]() ![]() A few days later, the bank said it hired IBM to help fix the problems. On 21 April, when TSB transferred accounts from Lloyds systems to its new Proteo4UK core banking system, customers began to experience serious problems with their mobile and internet banking services.Ĭustomers were locked out of their accounts and experienced money disappearing from online accounts, while some were even able to see other customers’ accounts.Īccording to the Financial Times, citing sources, TSB turned down an offer of help from Lloyds on the morning of 23 April when the scale of the problem was emerging. ![]()
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