TSB’s £1.8million-a-year chief executive Paul Pester leaves company

TSB’s £1.8million-a-year boss will leave the troubled bank in the wake of its botched IT switch and a string of ongoing technology failures, it was revealed today.

Paul Pester’s departure comes after a seven-year stint at the top, which has been marred by the IT woes that left up to 1.9million people using TSB’s digital and mobile banking locked out of their bank accounts.

TSB’s non-executive chairman, Richard Meddings, will take on the role of executive chairman with immediate effect to begin the hunt for a new chief executive. 

TSB chief executive Paul Pester has quit with immediate effect after seven years at the helm

The IT issues was triggered by a migration of customer data from former owner Lloyds’ system to a new one managed by TSB’s current owner Sabadell in April.

Then just yesterday, TSB customers woke up to another IT failure at the beleaguered lender, with many unable to access their accounts.

Hundreds took to social media to complain about issues including ‘duplicate transactions’, while TSB said that it was working to fix the issue.

Today, Mr Pester said: ‘Five years ago, on September 9, 2013, we launched TSB back onto high streets across Britain. I vividly remember standing in our Baker Street branch, waiting to reveal TSB above the door. 

Mr Pester told how he ‘vividly remember standing in our Baker Street branch, waiting to reveal TSB above the door’ on September 9, 2013

‘But it wasn’t just a sign we were revealing – we were revealing a bank with a clear mission to bring more competition to UK banking and ultimately make banking better for all UK consumers.

How outgoing TSB boss Paul Pester is a father who enjoys surfing

Paul Pester, who lives in London with his wife, was paid £1.8million last year.

The 54-year-old, who has two grown-up sons, likes to cast himself as a different sort of boss who wants to build a better banking industry.

He worked for Lloyds before overseeing its spin-off of TSB in 2013, then took the top job at the new bank and cultivated an image as the white knight of finance, attacking everything from unfair overdraft fees to irresponsible lending.

Mr Pester is a keen runner who challenged employees to a ‘beat the boss’ competition for charity at last year’s London triathlon.

The father of two also enjoys surfing and has been travelling to Fistral beach in Newquay, Cornwall to ride the waves since the age of six.

He once described getting on the water as ‘a real level of escape’, saying the sea ‘feels more like a natural habitat’.

Mr Pester was born in Plymouth to a swimming instructor father who once coached Olympic medallist Sharron Davies.

He obtained a mathematical physics doctorate from Oxford University before working as a consultant with firms including McKinsey.

His big break came in 1999 when he was made head of Virgin Money, before working for Lloyds and Moneyfacts. A short stint followed at Santander before he returned to Lloyds in 2010.

‘Thanks to the fantastic work and commitment of all TSB Partners, we have achieved real success in creating a bank which is truly consumer-focused, attracting customers from the UK’s established banks, and growing TSB’s balance sheet from circa £18billion to circa £31billion today. 

‘The last few months have been challenging for everyone at TSB. However, I want to thank all my colleagues across TSB for their dedication and commitment during this period and for their focus on putting things right for TSB customers.

‘It has been a privilege to lead TSB through its creation and first five years. I look forward to seeing the next stage of our bank’s history evolve.’ 

TSB’s failures have drawn strong criticism from politicians, including those on the Treasury Select Committee who have been scathing in their condemnation and called for Mr Pester to be sacked.

But TSB’s board and Sabadell had fully backed Mr Pester to continue in the role.

Mr Meddings said: ‘Paul has made an enormous contribution to TSB. Thanks to his passion and commitment, TSB is today one of the UK’s strongest challenger banks, serving over five million customers across the UK.

‘On behalf of the TSB Board, I want to thank Paul for everything he has achieved as CEO and pay tribute to the contribution he has made in bringing greater competition to the UK retail banking market.

‘Although there is more to do to achieve full stability for customers, the bank’s IT systems and services are much improved since the IT migration. 

‘Paul and the Board have therefore agreed that this is the right time to appoint a new CEO for TSB. Our goal is therefore to allow a full search to commence, without any distractions, enabling TSB to build for the future.

‘Meanwhile I have been asked by the Board to take on the role of Executive Chairman on an interim basis. 

Richard Meddings will become executive chairman as the search begins for a new TSB chief

‘Together with the Executive Committee, we have three immediate priorities: to complete the work of putting things right for customers; to enable the bank to achieve full functionality – including the availability of all product services and launch of a leading Business Banking offer; and appointing a CEO for the next chapter of TSB.’ 

The last few months have been challenging for everyone at TSB 

Paul Pester, outgoing TSB chief executive 

Last month it was revealed that TSB will double the size of its customer complaints team to 500 as the bank ramps up efforts to address customer grievances.

The troubled lender is recruiting hundreds of extra staff as it looks to address the 135,403 complaints which had been logged as of July 25.

A bank spokesman said today: ‘Whilst there is still work to do to achieve full stability for customers, TSB’s systems and services are much improved since the bank’s IT migration earlier this year.

‘Paul and the board have therefore agreed that this is the right time for Paul to step down and to appoint a new CEO for TSB.’

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