RBS plans £80m IT overhaul following summer meltdown

RBS plans £80m IT overhaul following summer meltdown

Bank could be labouring with 15 mainframe systems as a result of a lack of consolidation

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Royal Bank of Scotland is planning an £80 million IT systems overhaul after millions of customers couldn’t gain access to funds in their bank accounts after a botched upgrade in July.

The bank, which is 81 percent owned by the government, is planning to invest the money over the next twelve months to carry out the work, according to reports in the Sunday Telegraph.

Ron Teerlink, RBS’ chief information officer, is planning to reduce the banks’ number of mainframes to help reduce the potential for future problems. Sources have said that RBS has as many as 15 mainframe systems, due to a lack of consolidation following acquisitions that date as far back as the Natwest purchase in 2000.

The £80 million will be written off over the next four years.

It is believed that chief executive Stephen Hester was aware of the risks associated with operating on a sprawling mainframe estate in 2009 when he took control of the bank, but did not view it as a top priority.

His views seem to have changed since the summer when a botched upgrade to batch processing software CA 7 from CA technologies impacted accounts for more than a month.

It was revealed that RBS’ Edinburgh-based IT staff were ultimately responsible for the systems failure, which contradicted earlier media reports that claimed a junior IT worker based in India had made the error.

RBS said in its half year results that it will suffer losses of at least £125 million as a result of the failure.

Computerworld UK contacted the bank for confirmation of the plans but was told ‘no comment’ was being made at this time.

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