When TSB’s half-year results are announced next week there will be talk of the green shoots of recovery. Members should not be taken in by the spin. TSB’s earnings for the next few years are going to be under pressure from increasing competition in key markets, tight spreads in the UK mortgage market, potential Brexit uncertainties including interest rate reductions, changes in overdraft charges which will have a significant impact on the business and potential regulatory penalties linked to IT migration problems which could run into the hundreds of £millions.

Cutting costs will be Debbie Crosbie’s overriding objective. We understand the three Branch Distribution Directors have been told to rank branches by profitability and the worst performing branches will be progressively closed over the next 18 months. That work is being done now. Hundreds of redundancies will be inevitable.

Furthermore, we also understand that the decision to close 70+ branches for a few days or hours was not supported by some of the new senior management team. The costs savings were deemed to be marginal, which is why TSB did it in the first place, and not worth the fallout to the bank’s reputation. It would have been better to just close the branches, and take the hit in one go so the argument goes.

And let’s be clear, just because a branch is busy, doesn’t mean it’s profitable. Some of the busiest branches in TSB are probably the most unprofitable. TSB will commit to refurbishing some of its most profitable branches, and a few more mega stores – similar to the ones in Manchester, Birmingham and Aberdeen – will be opened.

But by 2021, TSB will be significantly smaller when measured against all the key bank metrics. TSB’s strategy under Mrs Crosbie and her Spanish paymasters is to make the bank smaller, more digitally focused and ready for the inevitable sale. In fact, Sabadell, TSB’s parent company, has got its own financial problems and there is no guarantee that it won’t be swallowed up by a Spanish rival in the next few years.

IT Misery Set To Continue Into 2020

And whist all of that is going on, the technology is still not working properly. Log on, log off; Log on, log off; Log on, log off. That is what it’s like for staff trying to work with the new IT system. Members have told us it’s not unusual for them to log on and log off the system 3 or 4 times whilst a customer is standing in front of them. Debbie Crosbie recently said: “….despite the fact that in the last few quarters we’ve only had one major incident, I know that a lot of partners in branches have had a number of challenges”. That’s an understatement. The problems also affect staff working in service and telephony centres. The system is still not stable and won’t be until the end of 2019, at the earliest. There are 400 fixes which still need to be made to the system and those are going to cause more problems in branches, service and contact centres over the next few months. TSB needs to be more open and honest with staff and customers about the changes. At the very least, staff should be told about the fixes before they are made and the bank should explain how those changes are likely to affect the stability of the system.

Members who are asked to do jobs that were previously done by cleaners should contact the Union’s Advice Team immediately on 01234 716029.

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