Royal Bank of Scotland set to be fined by regulator for 2012 system crash
LONDON (Reuters) - Royal Bank of Scotland is expected to be fined by Britain's financial regulator on Thursday for a system crash in 2012 that left millions of customers unable to make or receive payments, according to industry sources.
The penalty from the Financial Conduct Authority could be in the region of 50 million pounds, according to two sources familiar with the matter.
RBS customers were affected in June 2012 by problems with online banking and payments after a software upgrade went wrong. That cost the bank 175 million pounds ($274 million) in compensation for customers and extra payments to staff after the bank opened branches for longer in response. Former Chief Executive Stephen Hester chose to waive his 2012 bonus to appease frustrated customers.
The problems raised questions about the resilience of RBS's technology, which analysts and banking industry sources regard as outdated and made up of a complex patchwork of systems after dozens of acquisitions.
The bank suffered a further technology outage in December last year, which left more than 1 million customers unable to withdraw cash or pay for goods on one of the busiest shopping days of the year. Following that episode, Chief Executive Ross McEwan admitted the bank, which is 80 percent-owned by the British government, had neglected its technology for decades.
The bank has been hit by a succession of fines by regulators for past failures and misconduct. Last week, it was fined $634 million by regulators in Britain and the United States after failing to stop traders from trying to manipulate the foreign exchange market.
(Reporting by Matt Scuffham, editing by David Evans)
