No long-term damage to Ulster Bank, insists chief

 

ULSTER BANK chief executive Jim Brown has said he does not believe the ongoing technical problems affecting more than 100,000 of its customers have caused long-term reputational damage to the bank.

Mr Brown said the issues with the bank’s processing systems had proven to be “more complex” than initially thought when they arose in the middle of last week.

Ulster Bank has had to revise its estimate of when it expects the problem to be fixed a number of times, but Mr Brown said he was confident of getting “things back to normal by early next week”.

The technical problem has hampered the bank’s ability to process payments and created what Ulster Bank described as an “unprecedented” backlog.

This meant that certain transactions, including salaries and social welfare payments, have been failing to appear in customer accounts on time.

In an interview with The Irish Times, Mr Brown said the problem would likely “cost the bank a lot of money” but he did not know how much.

“For me the number one issue is the customers and getting things right as soon as we possibly can,” he said.

“I do apologise for the inconvenience caused to our customers and others as a consequence of the issues we have had with our systems.”

Asked whether he felt the episode had caused lasting damage to the reputation of Ulster Bank and whether it might result in migration to other financial institutions, Mr Brown replied: “I don’t think so.”

“I was in a branch earlier today and I was talking to customers and staff . . . Clearly they’re inconvenienced, but there was a lot of support and goodwill from the customers and I thank them for that.”

The issues, Mr Brown said, had arisen as a result of problems with an upgrade to a processing system held in Edinburgh, which also supports accounts held by Ulster Bank’s parent company Royal Bank of Scotland and British retail bank NatWest.

On Wednesday, RBS group said the vast majority of NatWest and RBS accounts had been free from disruption for two days but that Ulster Bank customers would continue to face “significant problems” for the rest of this week.

Mr Brown denied that repairing the issues at Ulster Bank had been less of a priority for the group.

“There is a sequencing in terms of how the systems are structured and how the processes actually run. It hasn’t been a case of prioritising one business over the other. It’s more a technical issue of how the systems were set up years ago.”

He added that customers affected by the issues would not be left out of pocket as a result of fees, charges or interest incurred as a result of payments failing to go through because of the ongoing technical problems.

The Central Bank last night said it was concerned by “the unacceptable continuing delays” by Ulster Bank in resolving the problem.

Deputy Central Bank governor Matthew Elderfield earlier this week met with RBS group chief executive Stephen Hester “to emphasise to him the importance of RBS addressing the continuing delays in resolving the technical issues”, the Central Bank said.

“The Central Bank is working with the UK Financial Services Authority and the Bank of England in investigating the root cause of the issue at the group level and how this has impacted Ulster Bank’s payment systems.”

Mr Brown said there were lessons to be learned from the episode. While the current focus was on getting things back to normal as quickly as possible, “we’ll come back to the other issues once we have done that”.

Some 80 Ulster Bank branches will extend opening hours until 7pm today to serve customers affected by the problem. Sixty branches of the bank will open from 10am to 3pm tomorrow, and from 10am to 1pm on Sunday.