back to article RBS MELTDOWN LATEST: 'We'll be the bank we should be ... next YEAR maybe'

RBS Banking Group is still refusing to say what went wrong with IT systems in its third major outage in less than two years, despite the fact that customers are still facing problems with their accounts today. In a mea culpa statement, chief exec Ross McEwan said that the systems failure on Cyber Monday was "unacceptable" and …

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  1. Spoonsinger

    F__*__c__kwits

    That's all I have to say on the matter.

    1. Anonymous Coward
      Anonymous Coward

      Re: F__*__c__kwits

      Royal Fuckwits, still, though.

      It really is about time the royal charter was withdrawn:

      http://epetitions.direct.gov.uk/petitions/44385

      C'mon Regtards, sign up, damn you sign up!

      1. asdf
        Trollface

        Re: F__*__c__kwits

        The queen probably couldn't give a f__k what us Yanks think of some bank we have never had to deal with. Fear not ours are just as evil and as incompetent though.

        1. Anonymous Coward
          Anonymous Coward

          Re: F__*__c__kwits

          "couldn't give a f__k what us Yanks think of some bank we have never had to deal with"

          Many of your compatriots DO have to deal with RBS, because they own Citizens Financial who have about 1,500 branches across the North West of the US. And the dodgy practices that RBS are famous for seem to have been matched by Citizens, who were fined $140m for excessive overdraft fees.

          1. MondoMan
            Facepalm

            American geography

            Er, Citizens Financial seems to be located only in the Chicago area. Although there IS a university called Northwestern there, it has been at least 200 years since that was considered to be the "North West of the US". The Louisiana purchase in 1803 definitely ended that, as did the later organization of the Oregon Territory (today's Washington, Oregon, Idaho and a few extra bits).

            1. Anonymous Coward
              Anonymous Coward

              Re: American geography

              "Er, Citizens Financial seems to be located only in the Chicago area"

              Oops. North East US was what I meant, not North West. It being West of me by some few thousand miles causing some cognitive problems. There is quite a lot outside of Chicago, with a reasonably large footprint:

              http://www.citizensbank.com/pdf/AtAGlanceFactSheet.pdf

              But to return to the topic, Citizens is still part of the Rancid Bank of Scotland group, albeit with a big "for sale" sign above it.

  2. The last doughnut
    FAIL

    To be fair it may take them a while to work out what has actually happened - according to hearsay the hastily assembled banking behemoth has a wide variety of legacy systems and a dispersed and cheaply procured IT operation.

    1. Anonymous Coward
      Anonymous Coward

      "hastily assembled banking behemoth"

      I don't think hastily assembled applies to RBS - they've been a behemoth for years.

      The level of incompetence across the whole of the bank is growing - its not just IT that have no clue.

  3. Jim Willsher

    Quit moaning peeps and just move banks. Simples.

    1. Anonymous Coward
      Anonymous Coward

      I would, except they're all as bad as each other. one way or another.

      1. Anonymous Coward
        Anonymous Coward

        It's the same across every industry I can think of.

        If in any industry all the big players can be assured that each offers an ever lower level of service then it doesn't matter who the consumer moves to the service will be no better or little better at their new choice of provider for that service.

      2. Anonymous Coward
        Anonymous Coward

        I can say I think my bank is pretty reliable, so far they have not broken down on me, I think there was the odd web outage but nothing stopping my cards from working..

        BUT I don't trust a single bank card to be sufficient..

        I carry multiple cards from different banks. if one goes down I can pretty much rely on one of the others working..

        if none of them are working, then I REALLY need to worry, but not about paying for things...

    2. Intractable Potsherd

      So, based on anyone's real knowledge of the systems in place, which bank(s) are least likely to have serious IT problems? Serious question, because I want to change and this is one of my important criteria.

      1. Fogcat

        "So, based on anyone's real knowledge of the systems in place, which bank(s) are least likely to have serious IT problems? Serious question, because I want to change and this is one of my important criteria."

        From a purely customer service point of view I'd recommend First Direct. Always been very helpful and have sorted out things for me that weren't actually their problem. The phone even gets answered really quickly.

        I can't answer about their IT systems, but they're a part of HSBC so there is probably some reliance on that".

        No, I don't work for them or have any connection, just been with them since soon after they opened and found their service good.

        1. Intractable Potsherd

          Thanks, Fogcat. That is useful.

        2. Redbaron

          First Direct

          I've been with them since soon after they opened too. I remember the special CD for dial-up (not internet) banking.

          They've been great during all that time. Recommended.

          Also have no idea about who does the IT, but I've yet to hear them say "sorry, sir, the system's down" when I call them. And they call me before charging me if I've made a right cockup of my account and there's not enough cash in there for a DD,

  4. BigAndos

    I think most retail banks are in a similar state, RBS are just unlucky in that their house of IT cards is the most wobbly!

  5. Yet Another Anonymous coward Silver badge

    Or perhaps

    They are deliberately trying to sink RBS so they can charge it huge receivership fees and buy its assets on the cheap

    1. wolfetone Silver badge

      Re: Or perhaps

      The hunters become the hunted.

  6. nsld
    FAIL

    useless

    They should have been left to fail, the only reason they got bailed out was to appease the Scottish Thanks to the failed bean counter Brown.

    Now the tax payer is left to shore up a dying mess of a bank which should have been killed off when it went tits up.

    1. Anonymous Coward
      Boffin

      Re: useless

      This is just a stupid thing to say, sorry. Have you thought about what "being left to fail" means? It means that at some point RBS would have declared bankruptcy and at, or shortly after, that point all its customers would have lost access to their accounts for some indefinite period. That means that, if you were a customer, what happened on Monday night would have gone on for weeks. That's a pretty bad outcome, to put it rather mildly.

      "Oh no" you say, "what would have happened is that someone would have bought the business as a going concern". Here's a clue: that's what happened, with the "someone" being "the UK government" since there were no other organisations willing or able to buy them.

      The real problem is that RBS's new owners (that's the people who hang out in Westminster) have done essentially nothing: in particular they have not split the investment bank from the retail bank, possibly split the retail bank further, and they certainly have not done anything to deal with the IT mess in RBS and the other banks over which they directly or indirectly have power. It's not, unfortunately, very hard to guess why this might be, though saying it out loud would probably result in accusations of defamation by said Westminster people.

      1. Anonymous Coward
        Anonymous Coward

        Re: useless

        "This is just a stupid thing to say, sorry."

        Well, strictly speaking RBS did fail, and the government had to bail it out as the UK deposit protection scheme meant that either the state paid up, or other financial services companies (who couldn't absorb losses on that scale) would have been dragged down with RBS.

        The mistake the state made was not in making attempts to revive RBS - they should have accepted that it had failed, and actively facilitated its disappearance from the market, whilst keeping the core bank operational. Much in the manner of an insurance fund in run-off. They should have opened the banks books to the SFO and City police, offered an amnesty for whistleblowers, and cleansed the dirt. Had they done that then a fair proportion of the LIBOR rigging guilt would not have attached to RBS, and the bank wouldn't now be sucking on a total of £700m in fines (perhaps more like £200m). New entrants and competitors could have bought tranches of customers if they wanted (not the failed hive off a few dormant and unprofitable accounts model that RBS offered, mind you).

      2. nsld

        Re: useless

        Last time I looked that's how capitalism works. The reality is that the bank could have been sold without taxpayer intervention but it would have been the end of the bank and a lot of jobs in Scotland would be lost.

        Instead the monster was kept alive because it would have become very apparent in the unwinding that the various regulatory bodies had screwed the pooch and the damage to the public would have been a guaranteed election defeat if it had been let go.

        Given the banking guarantee on savings from the government only the wealthy depositors faced losses, the average customer was fine and well protected.

        Letting it die would have sent a strong message to the others but now they are all to big to fail is business as usual.

        1. Anonymous Coward
          Boffin

          Re: useless

          I think you are confused. Firstly, as others have said most of RBSs employees and customers are not in Scotland, so the whole Scottish thing is just a (rather nasty) red herring.

          Secondly, try and work out how much the banking guarantee would be worth to you at the point that your account stopped working: my guess is that it's worth something only if it works immediately and if it makes all your direct debits and so on magically work in whatever new bank you are now with. It would not do that. The knowledge that at some future point the government is going to pay you what is in your account is not much help until they do, because before that point you have no access to money, which you might need if you like to eat. And of course this is all assuming that the failure of RBS had not caused a cascade failure of other banks, which it likely would have.

          So there was really no short-term option but to keep RBS running.: it really was too big to fail. What is, in my opinion, not forgivable is that they then have done nothing about it or really any other bank, with the result that all this is going to happen again (not RBS in particular, but somewhere).

          That's all I have to say on this.

        2. Anonymous Coward
          Anonymous Coward

          Re: useless

          Actually the current banking guarantee only holds while it is never actually invoked.

    2. Andy Mc

      Re: useless

      Erm, the retail bit of RBS includes Natwest and Ulster banks. Which means they have a hell of a lot more customers in the rest of the UK than in Scotland who rely (relied?) on them to pay their bills. So take your anti-scottish tosh elsewhere.

      1. nsld

        Re: useless

        RBS head office is in Scotland along with the jobs. Wasn't talking about the customers, do please learn to read!

        Our unelected leader at the time was Scottish, go figure. .....

        1. Velv

          Re: useless

          @nlsd

          Actually the vast majority of RBS jobs are in England, mostly in NatWest branches, but also a substantial number in offices in the City, other parts of London and call centres across the nation (Manchester and Croydon spring to mind).

  7. sugerbear

    My statement is missing some detail...

    i noticed that my POS payment on monday at ASDA appears on my Natwest statement with absolutely no detail whatsoever (unless you call the last 4 digits of the card number..detail).

    Every other payment from this retailer is clearly definied and includes who the retailer was and the type. But not this one.

    Let the speculation begin !!

    1. WiganGeek

      Re: My statement is missing some detail...

      At a guess, the RBS credit acquiring systems fell over, and one of Link/VISA/Mastercard did stand-in authorisation on your card, or the transaction never went to online auth and was just floor-limit authorised at Asda, which means all your statement gets is the data passed back from the scheme to the bank.

      1. Anonymous Coward
        Anonymous Coward

        Re: My statement is missing some detail...

        Yep, some merchants, not acquired by RBS, decided to stand-in for RBS when they realised what was happening.

        Anyone know who acquires for ASDA?

  8. John G Imrie
    FAIL

    There my be trouble ahead.

    it said it would be spending an additional £450m on top of its £2bn annual IT spend for a "complete refresh of the mainframe"

    So we can expect further outages when they balls up the upgrades. In the long run I think it would be better to re hire all the IT Staff the fired and use them to train the new staff.

    1. Gerhard Mack

      Re: There my be trouble ahead.

      Exactly. They fired their experienced staff, ended up in trouble, and are now trying to solve the resulting problem by throwing more technology at it.

      1. Steve Todd

        Re: There my be trouble ahead.

        Nah, they'll be throwing lots of consultants and contractors at it (many of which probably worked for the bank before they fired them). Bean counters: they know the cost of everything and the value of nothing.

  9. Michael 28
    Mushroom

    wtf?

    "admitted that the group had failed to invest properly in IT "for decades""

    Are we talking punch-card level technology? Xenix 1.0 ? 8086 processors? Magnetic tape reels? or <shudder> pre-IBM technology?

    Details please.

    1. Peter2 Silver badge

      Re: wtf?

      Maybe they mean human investment.

      An admission that offshoring competent staff to India to get the wage bill down was a mistake perhaps?

    2. Anonymous Coward
      Anonymous Coward

      Re: wtf?

      Well, it is 2013. one decade ago was only 2003, two decades ago was 1993 - he only said the plural, and may have been exagerating a bit in an effort to play for sympathy.

      I work for a reasonably large investment bank and one of the critical cash processing systems has been barely touched for nearly 20 years, is running a software version that the vendors who wrote it do not officially support anymore and is on hardware that EOL'd in 2005.

      It doesn't surprise me to find that the big "tier 1" banks are in a worse state.

      I would assume that the bigger the bank, the more risk-adverse it is when it comes to their critical IT systems. Unfortunately, it seems that "risk adverse" usually translates to "it's working fine and has been for years, don't touch it in case it stops and doesn't start again!!"

    3. Anonymous Coward
      Anonymous Coward

      Re: wtf?

      It's rubbish, anyway, RBS have some of the most up-to-date technology you'd hope to find. Sure there are legacy systems, there always will be in companies that are 300-odd years old (or whatever it is) but the core stuff is seriously up to date and seriously invested in. Or at least it was until the current management turned up...

      Basically they run everything from z servers (the largest in Europe) down to desktops. You'll not be finding any punch cards or reel tape though.

      1. Fatman

        Re: wtf?

        Or at least it was until the current management turned up...

        You struck the "nail" squarely on the head!!!!!

        Too bad, one can't use a 10kg sledge on the grubby fingers of manglement.

    4. Steve Todd

      Re: wtf?

      Probably means they have shed loads of CICS/COBOL/ISAM code and IBM assembler that no one understands any more and is hard to maintain. Buying a faster mainframe is probably not the best way to go in this case (something like a clustered Power 7+ Server and Oracle RAC would probably be a better and more robust solution for general ledger/real time payments).

  10. Anonymous Coward
    Anonymous Coward

    I will be outlining plans in the New Year for making RBS the bank that our customers and the UK need it to be.

    Should have said that they'll make it into the bank that the people of the UK deserve, but not the one they need right now.

  11. jai

    Like Batman

    "making RBS the bank that our customers and the UK need"

    RBS are the bank the UK deserves, but not the bank we need right now...

    1. Anonymous Coward
      Anonymous Coward

      Re: Like Batman

      look at the post above you :P

      1. jai

        Re: Like Batman

        lol

        great minds think alike... and don't work at RBS :)

        And also - i should read all the comments before i post :)

  12. Will Godfrey Silver badge
    Meh

    Maybe their vision has beome 'clouded'.

  13. Tom 7

    This is incredibly worrying, stressful and inconvenient

    and I expect full recompense for the aforementioned will be rapidly paid into the bank accounts of the directors.

  14. dervheid

    I think they need a bit of an incentive.

    Maybe they'd make their systems a shitload more robust if they were faced with having to compensate every customer with, say, £10 each, per day/part day affected (with a day being defined as 00:00:00 to 23:59:59).

  15. Peter Gathercole Silver badge

    Something not yet considered

    One point that has not been considered is that RBS are in an on-going transformation. As an RBS customer in England, I was given an outline of the Santander abortive sale, and recently information about the Williams and Glynn split (RBS are splitting most of their Scottish Nat-West branches, and most of their English RBS branches out into a separate bank with the revived name of Williams and Glynn).

    I've already been moved onto a different URL for on-line banking and banking-as-an-app, and we've had our debit cards re-issued twice in the last 18 months with different numbers, presumably with a different bank code hashed in the long number.

    I suspect that much of the $2bn+ spend promised next year is already earmarked for that split to happen

    It is possible that it was some of the on-going work for this which caused the problems, although Cyber Monday would be a really bad day to plan it. More probably, someone just screwed up.

    1. Anonymous Coward
      Anonymous Coward

      Re: Something not yet considered

      "I've already been moved onto a different URL for on-line banking and banking-as-an-app, and we've had our debit cards re-issued twice in the last 18 months with different numbers, presumably with a different bank code hashed in the long number."

      And you're still sticking with them? Were you the bloke over the barrel in Deliverance?

      1. Peter Gathercole Silver badge

        Re: Something not yet considered

        Actually, it's mainly a matter of momentum. They are still providing the banking services for me mostly successfully, and it looks as if I was not too badly affected by the problems (I managed to get money out of an ATM at just past 19:00, in the middle of the supposed problems). I was not affected at all by the previous problems, but that is probably because I get paid at a different time from most people (it was credits into the accounts that were affected).

        Also, it's easy moving an account, it's less easy moving a (reasonably priced) overdraft facility!

  16. DB2DBA

    A question of (data) integrity

    I find this statement by an RBS spokesman (quoted in The Guardian) to be telling: "If any customer is experiencing issues they should get in touch with our call centres or come into our branches, where our staff will be ready to help." This suggests that they don't have a handle on the data loss and need customers to identify the errors for them.

    1. Anonymous Coward
      Anonymous Coward

      Re: A question of (data) integrity

      No, what it says is that they'll make money available on a case by case basis where it's needed. Many people can deal without their accounts at a specific bank for weeks on end because they are not the primary account.

  17. John 156
    FAIL

    "It is too early to speculate on the cause. Our priority and focus has been to fix the problem."

    I tend to find that understanding the cause of a problem helps identify the extent of the data corruption and the course of action required to fix it; it further helps to identify who should be fired because at the moment whoever it is will be busy trying to cover their tracks and muddy the waters.

    1. Neil Milner-Harris

      Concur completely

      That was exactly my first thought, how can you fix something if you don't know what broke and how it was broken?

    2. Nigel 11

      Outsourced / offshored?

      Unless, of course, it's outsourced and offshored, so that if someone is "fired" he just gets swapped with someone making a mess of some other organisation's IT. If the entire outfit to which it is outsourced is "fired" the same principle will apply: you'll end up with someone else's rejects, either directly or indirectly (though mass hiring, firing, and forming new companies to tender for the work)

      Outsource the catering and the cleaning. If it's mission-critical it must be done in-house. If it's mission-critical and it fails because of under-investment, the CIO (and possibly CEO, rest of board) should be taken out and shot.

      1. Velv

        Re: Outsourced / offshored?

        So technically in RBS the mission critical stuff is done "in house" and isn't outsourced.

        It just so happens that many of the RBS employees who are supporting and maintaining the mission critical stuff are now employed in India and not the UK.

        But as events in the last two years have shown, you don't really need those 7,500 man years of site knowledge you've built up to run your business, any old "techie" in the world can pick it up and run it. NOT!

        1. Anonymous Coward
          Anonymous Coward

          Re: Outsourced / offshored?

          "any old "techie" in the world can pick it up and run it"

          Isn't it remarkable how many shit headed banking and corporate executives believe this crap about "outsourcing/offshoring low value activities", and swallow all the guff from consultants about "wage arbitrage", but then can't see that's what is sauce for the goose is sauce for the gander.

          Oi McEwan! If Indian salaries, terms and experience are good enough for the employees you rely on to serve your customers, then perhaps Indian salaries, terms and experience should be foisted on the board of Bent Bank of Scotland. You, your overpaid mates, your jumped "traders" and investment bankers, you can all f*ck right off to Bangalore, and take whatever the going rate for directors is there.

      2. Fatman

        Re: Outsourced / offshored?

        If it's mission-critical and it fails because of under-investment, the CIO (and possibly CEO, rest of board) should be taken out and shot.

        That will never fucking happen.

        Bankers Wankers always get someone else to shoulder the blame (or the 'clean up costs').

    3. Fatman
      Joke

      RE: It is too early to speculate on the cause

      ... further helps to identify who should be fired summarily executed because at the moment...

      FTFY!!!

      Huge bonuses for manglement at year end for their invaluable attempts at increasing shareholder value.

      Now there is an idea

      Because of last year's and this year's fuckups, no one in manglement should get a bonus at year end. The costs to clean up after the shit hit the fan should be borne by manglement. Think that'll teach them??? Doubt it!

  18. KierO

    A bank failing to invest properly in IT?

    NEVER!!!

  19. G4Z

    I imagine though they could never seem to find the money for IT spending, it was always available to pay bonuses.

  20. Anonymous Coward
    Anonymous Coward

    The problem isn't historical under investment - I was there for 7odd years before I took redundancy - during this time they spent money like there was no tomorrow on their IT infrastructure. The problem is letting all of your most skilled staff take redundancy and walk off with something like 7500 man years of experience, then pretending that it's under investment to try to get out of the consequences of the current policies at the company by blaming it on the unpopular previous management.

  21. Fenton

    What if

    The trouble is, if everybody decided to switch, would this not effectively be a run on the bank?

    Those people who are too slow will have to be bailed out (again) by the government.

    We'd then have to write off our "investment" in the bank.

    A shit situation really

  22. Fatman
    FAIL

    Oooops! We screwed up!

    In a mea culpa statement, chief exec Ross McEwan said that the systems failure on Cyber Monday was "unacceptable" and admitted that the group had failed to invest properly in IT "for decades".

    "It will take time, but we are investing heavily in building IT systems our customers can rely on," he said.

    That load of bullshit caused me to expel lunch violently towards that poor monitor. Now I have to get another one.

    What the fuck do you expect from damagement whose only method of increasing shareholder value is to keep on cutting costs while rewarding themselves with ever increasing bonuses?

    This is RBS:

    http://i.telegraph.co.uk/multimedia/archive/02109/boat1epa_2109054i.jpg

  23. Anonymous Coward
    Anonymous Coward

    Refresh the Mainframe

    Oh my god.

    It'll be down for years.

  24. drexciya
    Thumb Down

    After reading a number of articles on their "business practices" (deliberately duping their customers), which came up on several blogs recently (Naked Capitalism for example), I can only say that RBS should just die and their managers should be prosecuted.

    This latest c**c-up just shows they are not even remotely interested in offering proper services to their customers. The only thing they're interested is money and they don't care about the how and why. How is it possible that they still exist given their track record?

    1. Anonymous Coward
      Anonymous Coward

      Yeah, because Naked Capitalism is a respected industry journal, not a partisan web site with a series of axes to grind...

  25. Anonymous Coward
    Anonymous Coward

    Another off-shoring/outsourcing partial success story.

    Well done Fred and his team of senior managers for saving money all those years ago. It just goes to show anyone can 'do' IT to banking standards.

    1. Anonymous Coward
      Anonymous Coward

      Re: Another off-shoring/outsourcing partial success story.

      The offshoring never happened under Fred, that was a line in the sand for him. The offshoring and instability happened only after he left.

  26. Anonymous Coward
    Anonymous Coward

    The truth

    OK! The truth is that the card reader broke down, just as we were about to start the paper tape import job.

    Then due to a blockage in the chilled water supply we blew a few valves in the memory chassis.

    Luck for us we were able to recover back to Friday last week using our new floppy disk archive. Then it was just a case of loading up the 9 track tape with all the outstanding transactions on it and just hit "go" on any parity error reports.

    1. Anonymous Coward
      Anonymous Coward

      Re: The truth

      Due to the "high profile outage" we are investing in a stock of valves, a second card reader, some drum storage and our R&D department is looking at the new 3590 tape drives to replace the floppy disks.

  27. regadpellagru
    Coffee/keyboard

    hardware refresh, but probably not more

    "The investment pot is the same one that RBS talked about this summer when it said it would be spending an additional £450m on top of its £2bn annual IT spend for a "complete refresh of the mainframe"."

    Seems to me they're frenetically spending millions on hardware to tick the box, but nothing to update the old stuff written in Cobol 68, which happens to still run, no-one knows how, on modern mainframes, and is an explosive waiting to blow up.

    I'm sure we'll discover more, as each incident is reported here, in the 2 coming years.

    As as been said above, move banks, they're not all the same, and the time spent to move on is well spent. Did that myself 8 years back, and I never regretted any of the hours spent for this.

  28. spiny norman

    Rot

    The rot started when they merged the National Provincial with the Westminster.

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