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By Huw Jones
LONDON, March 28 (Reuters) - Britain’s financial regulators will examine whether computer systems used by the country’s banks and building societies are fit for purpose, after a succession of problems which left millions of customers unable to get any cash.
Royal Bank of Scotland customers could not make or receive payments in March 2013, which followed a fault nine months earlier that cost 175 million pounds to rectify and prompted the lender’s chief executive to waive his bonus.
Separately tens of thousands of Lloyds customers were unable to use their debit cards and ATM cash machines for several hours on a Sunday in January.
The Financial Conduct Authority, the Bank of England and its Prudential Regulation Authority will launch the review to be concluded by early 2015, the FCA said in a statement on Friday.
“To access and manage our money we depend on the banks’ IT systems to be reliable. But IT outages continue, interrupting key banking services,” Clive Adamson, FCA director of supervision, said.
“We want to make sure that the banks have resilient IT systems in place that are able to cope with consumer demand, so customers aren’t left financially stranded or disadvantaged,” Adamson added.
The investigation will also look at how engaged boards at banks are with the issue of IT resilience and whether they have the expertise needed to challenge the decisions taken by the executive.
The probe follows letters sent by regulators to the chairmen of the nine biggest banks and building societies in 2012, asking how resilient their computer systems are and what concerns they have, the FCA said.
The review will assess what progress has been made so far by the banks and whether more needs to be done.
Andy Haldane, a senior official at the Bank of England, has suggested a common network for the banks to ensure adequate investment and make it easier for competition in banking to flourish, a step Lloyds Banking has said would turn any fault into a network-wide failure. (Reporting by Huw Jones, Chris Vellacott; Editing by Greg Mahlich)