UPDATE 3 – TSB Bank Plc said on Tuesday that its CEO Paul Pester is leaving the company after months of pressure that followed a botched IT project that has cost more than £180 million.
Pester was heavily criticised for his handling of the major IT update in April that led to one of the UK’s worst banking outages and affected up to 1.9 million digital customers.
Richard Meddings, TSB non-executive chairman, will take on the role of executive chairman with immediate effect while the bank, owned by Spain’s Banco Sabadell, searches for a new CEO.
TSB’s announcement came the day after TSB’s online and mobile banking customers once again struggled to access their money — just the latest in a long line of glitches.
“Whilst there is still work to do to achieve full stability for customers, TSB’s systems and services are much improved since the bank’s IT migration earlier this year,” said TSB.
“Paul and the board have therefore agreed that this is the right time for Paul to step down and to appoint a new CEO for TSB.”
TSB added: “Paul will be paid in line with the bank’s remuneration policy and the terms of his contract.
“The release of variable pay will take into account the outcome of performance conditions as well as ongoing regulatory and independent investigations.”
Meddings said: “Although there is more to do to achieve full stability for customers, the bank’s IT systems and services are much improved since the IT migration.
“Paul and the board have therefore agreed that this is the right time to appoint a new CEO for TSB.
“Our goal is therefore to allow a full search to commence, without any distractions, enabling TSB to build for the future.
“Meanwhile I have been asked by the board to take on the role of executive chairman on an interim basis.
“Together with the executive committee, we have three immediate priorities: to complete the work of putting things right for customers; to enable the bank to achieve full functionality – including the availability of all product services and launch of a leading business banking offer; and appointing a CEO for the next chapter of TSB.”
Pester said: “The last few months have been challenging for everyone at TSB.
“However, I want to thank all my colleagues across TSB for their dedication and commitment during this period and for their focus on putting things right for TSB customers.
“It has been a privilege to lead TSB through its creation and first five years.
“I look forward to seeing the next stage of our bank’s history evolve.”