Brian Brown's Official Website

Sponsored by

Brian Recommands

Sponsored by

One of Brian’s Favorite Quotes

A fair request should be followed by the deed in silence.”
— Dante Alighieri (1265–1321)
 The Divine Comedy

RBS And Software Firm Settle Over IT Failure

By Mark Kleinman, City Editor

The software supplier at the centre of a catastrophic IT failure at Royal Bank of Scotland (RBS) in 2012 has paid millions of pounds to the taxpayer-backed lender under a confidential settlement.

Sky News understands that CA Technologies, which is listed on New York’s Nasdaq stock exchange, reached an agreement with RBS which softened the financial impact on the bank of the systems breakdown.

RBS was fined £56m by two UK regulators on Thursday for governance and operational failings which caused chaos for more than six million customers.

The penalties included the first-ever fine from the Prudential Regulation Authority, which said that RBS had had “inadequate systems and controls”, as well as a £42m sanction from the Financial Conduct Authority.

It is unclear when CA and RBS reached an accommodation over the failure, which emerged in June 2012 following what should have been a routine software upgrade.

Sources said that CA had made a “significant” financial contribution, with RBS’s direct bill for the crisis reaching more than £70m in customer redress as well as the regulatory penalties.

The incident led watchdogs to strengthen their supervision of banks’ IT infrastructure as well as their contingency planning for such events.

Sir Philip Hampton, RBS chairman, apologised again this week to customers who were affected by the breakdown, which caused Stephen Hester, the then chief executive, to waive his bonus for 2012.

The £56m punishment was the latest in a string of regulatory fines to hit RBS since its £45.5bn rescue by UK taxpayers during the financial crisis.

RBS and CA Technologies are understood to have been prevented from revealing the details of their settlement by a non-disclosure agreement, and both companies declined to comment.

Link to this story: 

Please share with your friends:

Leave a Reply

Sponsored by

Brian Recommends

Sponsored by