Royal Bank of Scotland (RBS) is in discussions about taking legal action against US enterprise software giant CA because of the computer update that caused the massive backlog that disrupted banking services for thousands of banking customers in Ireland and the UK.
According to The Financial Times, people familiar with the situation say there is a significant chance of litigation being pursued against external technology suppliers because of the software glitch.
The software glitch triggered a backlog in processing payments, which won’t be cleared until next week.
The failure has cost the bank millions but may have further ramifications because unhappy customers may yet move their custom to other banks.
The problem is understood to have been caused by an update to a CA system called CA-7 overnight last week.
Ulster Bank customers will have to wait until next week for normal services to resume
The glitch has disrupted salary transfers, direct debits and social welfare payments, causing a delay in processing certain payments to bank accounts.
Customers will have to wait until early next week for normal service to be restored, Ulster Bank’s parent company RBS said in a statement yesterday.
This follows a statement from Ulster Bank the previous day that said clearance of a backlog of payments may not be resolved until the end of this week.
"RBS and NatWest confirm that the update of customer account balances has cleared overnight, with the exception of a few specific sets of transactions,” RBS’ statement said.
"We know this disruption was unacceptable and that many customers will still have questions and concerns. It is possible a small number of customers may experience delays as we return to a completely normal service,” RBS said.
"The full focus of our efforts will now be on delivering the same result for our Ulster Bank customers who continue to experience unacceptable delays to their accounts being updated. We are confident that this will help us restore a full service for the start of next week for Ulster Bank and remain grateful for our customers’ patience."