MSE News: RBS fined £56m over IT meltdown

Thrugelmir

agrinnall wrote: »

Thanks for that, it does provide a bit more hard information than I'd seen previously, and confirms a few of the rumours, although it's still a bit vague on the actual cause of the backout failure.

Under Fred the Shred. RBS invested very little into technology during it's years of expansion. Instead relied on a hotchpotch of patched together legacy systems. Probably a contributory reason behind the banks failure. As the Board had no idea what was actually going on across the empire.

Hanky_Panky

Thrugelmir wrote: »

Under Fred the Shred. RBS invested very little into technology during it's years of expansion. Instead relied on a hotchpotch of patched together legacy systems. Probably a contributory reason behind the banks failure. As the Board had no idea what was actually going on across the empire.

This is the case with every bank out there that's been around for any length of time. Quite simply it would be a massive task and a huge cost to replace all the systems within any bank and it's just not going to happen. New bits get added, plugged into old bits. Then an acquisition takes place so those systems are bolted on too. This has been happening since the first computerised systems were put in place way back in the 60's or 70's.

I remember back in 1990 the very small bank I worked for did replace all it's systems - completely. We had the most up to date banking system in the country and it cost us over £20m. For a Barclays or HSBC to do that would have cost £100's of millions all that time ago.

Ken68

Overkill, it means that customers/taxpayers pick up the tab.
Sounds like a deal has been struck, the banks let the government fine as they see fit, as long as no bankers go to jail.

Thrugelmir

Hanky_Panky wrote: »

This is the case with every bank out there that's been around for any length of time.

RBS did go grow from a tin pot Scottish entity to the largest bank in the world in the space of 15 years. So not just a UK based operation. You can't operate and run a bank with a £2 trillion balance sheet without accurate and up to date information.