Britain’s banks need to dedicate far greater resources toward securing their information technology (IT) infrastructure and should have a designated board member overseeing the issue, a senior lawmaker said, following a string of high-profile technology failures.
Andrew Tyrie, chairman of British Parliament’s Treasury Committee, also suggested that Bank of England Deputy Governor Andrew Bailey, who heads its banks supervisory arm, should be tasked with ensuring banks develop more resilience.
Britain’s retail banks have been hit by a number of technology failures in recent years, causing inconvenience for hundreds of thousands of customers and prompting lawmakers to call for more investment in financial technology.
“Every few months we have yet another IT failure at a major bank,” Tyrie said in a statement yesterday. “These IT blunders and weaknesses are exposing millions of people to uncertainty, disruption and sometimes distress. Businesses suffer, too. We can’t carry on like this.”
Tyrie said someone, probably Bailey, the head of the bank’s Prudential Regulation Authority (PRA) supervisory arm, needed to take “a leadership role” over an issue that poses systemic risk to the banking system.
“Currently, no one group seems to be directly responsible for developing a full understanding of the risks carried,” Tyrie said in a letter to Bailey dated on Friday and published by the committee.
“A group of this type should now be formed with the primary task of ensuring that the banks develop more robust resilience to protect banking and payment systems. The head of the PRA may be best suited for the leadership role,” Tyrie said.
HSBC Holdings PLC suffered an online and mobile banking blackout this month, while thousands of Britons last year failed to receive their wages when some HSBC business customers were blocked from making payments.
State-backed Royal Bank of Scotland Group PLC has promised to invest hundreds of millions of pounds in its computer systems after a series of high-profile glitches. Some customers at Barclays PLC have also endured problems.
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