The Cost Of TSB’s IT Meltdown: £259,191,231

That is how much the botched IT migration has cost TSB so far according to the latest set of financial results.

TSB made a £120.5 million loss for the nine months to September. On the back of the meltdown, Sabadell, TSB’s owner, has seen its share price fall by 24% over the last 12 months. In fact, the figures were so bad that TSB chose not to issue separate performance figures for Q3 2018, instead relying on Sabadell executives in Alicante to announce the bad news.

The figure of £259,191,231 is going to be significantly larger when you include fines from the FCA and costs for Q4 2018 and those for 2019. The cost of the meltdown so far is equivalent to giving every member staff employed by the TSB in April, excluding BEC members who deserve nothing, a payment of £32,399 each.

The bill so far is made up as follows:

Waived fees & charges

£31,799,368

Classic plus account – increased interest

£6,056,888

Losses for fraud and other operation losses

£51,215,856

Lawyers, Consultants and other resource support

£87,734,988

Customer redress

£82,303,895

There will be those in Sabadell and TSB who will use the losses described above to squeeze pay increases for next year and reduce the size of the TSB Award. Some will argue that there shouldn’t be any TSB Award for 2018 at all because of the losses. Let’s be clear, the losses for 2018 are because TSB’s BEC and Board failed to do their jobs properly. The staff working in branches, contact centres and operational centres were not responsible for the decision to migrate and their hard work and dedication have saved the Bank. Those TSB staff should be rewarded appropriately. Anything less than an inflation busting pay increase, the full TSB Award and a migration payment, which we called for earlier in the year, will be unacceptable to the only independent union in TSB.