TSB owner wants bank to start shopping spree after dealing with IT meltdown fallout

The bank's Spanish owner denied plans to sell TSB, and said the UK bank was its 'reason for being'

The challenger bank was rocked by a long-running technology failure earlier this year (Getty)

Spain’s Sabadell wants its British unit TSB to start buying other businesses once it has cleared up the fallout from an IT meltdown, a spokesman for the group said on Friday.

Chairman Josep Oliu had said on Thursday Sabadell would in January present a plan to turn around TSB, which suffered a technology failure this year that will cost it some €320m (£285.2m).

“The aim is that TSB enters into a process of consolidation in the future in Britain,” Oliu said at an event in New York. “We will need at least two years for this. Afterwards we will enter into the consolidation process.”

His words prompted speculation Sabadell could look to sell TSB, whose chief executive Paul Pester resigned after a botched system switch locked nearly two million customers out of online banking services and led to a surge in fraud.

But a spokesman denied any plan to sell TSB, saying instead Sabadell wanted to beef it up by buying other assets, adding that the British unit was Sabadell’s “reason for being”.

“Once we have got past the IT problems, our priority is to deploy more modern and efficient platforms in Britain, to be an important player in the small and medium-sized business market,” the spokesman said.

TSB’s IT meltdown rocked the bank, leaving thousands of customers without access to their cash, and ultimately led to the departure of chief executive Paul Pester.

The crisis also prompted a parliamentary investigation into IT failures at banks and other financial firms.

TSB recently came last in a ranking of the UK's banks, having taken fourth place in last year's list.

Gareth Shaw, money expert at Which?, which carried out the research, said the drop culd be attributed to the tech issues that saw consumers locked out of their accounts.