TSB sees profits fall after delay to IT system rollout

TSB’s statutory pre-tax profits fell more than 10 per cent last year, largely due to a delay in launching its own IT system.

The bank, which was spun off from Lloyds Banking Group in 2013, saw profits fall £19.3 million (10.6 per cent) to £162.7 million last year.

A major contributor to the fall is the £122 million in outsourcing fees it paid to Lloyds for use of the banking group’s IT system.

TSB’s plan to migrate to a new IT platform built by owner Banco de Sabadell has been beset by delays, having been due to roll out in November 2017 but now set for some time in 2018.

In a statement, TSB said: “Until the final phase of the rollout of our new banking platform to customers is completed the contractual increase in outsourcing fees paid to Lloyds Banking Group will continue into 2018.”

However, it added that “underlying management profit” would “continue to grow”.

TSB also announced that Richard Meddings, former finance director at Standard Chartered, would replace Will Samuel as chairman with immediate effect.

Mr Meddings, who joined the TSB Board last year, is also a non-executive director at Deutsche Bank and the UK Treasury.

 

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