UB IT Debacle: What preventive measures are UB taking to stop such events in future?

[ajapale]

As a long time UB customer I want to know what preventive measures UB are taking to prevent such events occurring in the future.

Has the bank fully identified the root cause of the incident and the knock on effects? Is the bank taking effective steps to prevent or at least mitigate such systemic failure in the future.

 

[ontour]

Sh1t happens, they can't say it will never happen again. The processes, systems and procedures that deal with the issue when it occurs is what is most important. IMHO they should have taken the bank offline until they solved the issue which I believe would have been within 24 hours. They should reduce or remove batch processing or scale the hardware to allow it to be run quickly so that fixes can be applied quickly after an issue occurs.

Most blame in these situations go to really old and complex systems that very few people understand. Ironically in the case of Ulster/ RBS, it was trying to improve the old systems that created the opportunity for the mistake to be made.

There also needs to be a recognition that you don't need to employ a highly skilled person for 99.9% of the times batches are run, they need the talent so that the employee can deal with the .1% or .0001% of cases where things go wrong.

 

[Mark Power]

Banks are still locked into an antiquated batch payment processing system. The drive with most banks is to reduce their operational costs and not to improve system reliability. There is increased pressure to increase the capital buffers and show a healthy balance sheet. The operational systems are expensive to run and most banks have looked to off shore or out source the management of these systems. There is some truth in the saying "if you pay peanuts you get monkeys".

 

[ajapale]

The processes, systems and procedures that deal with the issue when it occurs is what is most important.

Banks are still locked into an antiquated batch payment processing system. The drive with most banks is to reduce their operational costs and not to improve system reliability.

Thanks Ontour and Mark Power,

As a long standing customer of UB I would much rather the bank address its systematic problems with a comprehensive root cause analysis, concrete preventive and corrective measures ... rather than with cosmetic PR gimmickry (trivial compensation offers, wordy apologies, advertising etc).

Compensation, PR fluff and Blame Game playing are not a replacement for a proper Quality Assurance Approach which seeks to identify what when wrong and then rectify it for good.

 

[ontour]

RBS are trying to address the systematic problems although it is questionable how well they are doing it. Based on other banks that have addressed it, it will take 4-8 years! Lots of patience required!!

 

[Eithneangela]

I think most major organisations (banks included) are total hostages to ancient IT systems, particularly in the back office (the main engine of any transaction processing company). They've spent loads of money on upfront stuff, like online banking, phone apps, etc. and still depend on the same old usually outourced delivery of the really key stuff like batch runs (e.g. overnight processing/updating of all daily transactions, backup copies of all transactions and accounts etc.) and they are actually so dependent on the IT stuff that they can't see the woods for the trees! Paying buttons for an outsourced company to provide a data management service has repurcussions! Getting complacent with inhouse computer processes management also has repurcussions! Looks like it's back to basics for us mere mortals, the bank customers - we need to check regularly every transaction, every balance, etc. because we intrinsically do not trust the banks to carry out the standard transactions accurately or timely. God be with the days when you had a lovely book in your hand, and every time a transaction occured with the bank, they were liable because they had to write in the book. I inherited some of these from my parents - wonderful stuff - so much for computers and how the major organisations use/abuse them!

 

[SoylentGreen]

There is certainly some satisfaction being handed back my book from the credit union and seeing my transaction updated right there in front of my eyes. It can be stored in a drawer for all to see if something were to happen to me.
A family member recently passed away. We found his Irish Life and Permanent dividends still attached to the A4 page that were posted out to him. He must have thought that these were some sort of circulars being posted out, not realising that it was actually a cheque.

 

[ajapale]

Ulster Bank delays to be investigated in UK | The Irish Times


I like the tone of the UK regulator in this case and hope that the Irish regulator adopts a similar robust approach concentrating on investigating the root cause and instigating preventive actions.

The chairman of the Financial Services Authority, Adair Turner, said it has told RBS it wants “a separate full review to be undertaken by an independent skilled person to established what went wrong and why”.

The FSA demanded the names of senior managers who could be held personally responsible if information technology systems go awry.

 

[ontour]

The problem is not technology, it is that there are too few players with huge market share in banking. If Topaz garages were constantly running out of diesel, I would transfer my business to Esso. Topaz lose business and fail if they can not meet basic customer needs. If one insurance provider can't provide a service, I move to an alternate provider.

Getting names of senior managers to blame shifts some of the responsibility to regulation. Regulation should be focused on making the market work more efficiently, not identifying whose head gets put on a stick when something goes wrong. Idiotic political 'solution' by FSA ( a bit LOS, I know !!)