Published Friday, 03 August 2012
£28 million has been set aside to deal with the fallout at Ulster Bank. (© PA)
Technical glitches hit the RBS Group on Tuesday 19 June and affected millions of Ulster Bank, RBS and NatWest users throughout the UK and Ireland.
Ulster Bank, which is a subsidiary of Royal Bank of Scotland, was the worst affected by the IT meltdown, with 100,000 customers unable to access their accounts and others left without wages or business payments.
The 80% state-owned RBS group set aside £125 million for dealing with the fallout of the computer glitch, of which £28m will go to Ulster Bank, but it has not yet began dealing with compensation.
On Wednesday, the Consumer Council met with the bank and has urged them to finalise the compensation procedure as soon as possible.
Ulster Bank chief executive Jim Brown said: "Given the scale of the impact on our customers, we expect that there will be additional costs over the coming months as we continue the process of putting things right."
"We continue to work with our customers who are in financial difficulty on an individual basis to offer them appropriate support initiatives."
He added: "Our forbearance arrangements are tailored to reflect individual circumstances and we continue to actively encourage our customers to contact us if they have any concerns about their financial health or are experiencing financial difficulty.
"We remain focused on the recovery of our business - rebuilding our franchise, supporting the communities in which we operate and serving the needs of our 1.9 million customers across the island of Ireland."
State-supported Royal Bank of Scotland, which has 30 million customers worldwide, announced a pre-tax loss of £1.5 billion in the last six months to the end of June, compared to £794 million last year.
The RBS Group also took a £135 million hit to cover the cost of payment protection insurance (PPI) mis-selling, bringing its total bill to £1.3 billion, while it took a £50million charge to compensate small businesses that were mis-sold complex interest rate swaps.
RBS boss Stephen Hester said: "We have continued to make the bank safer and stronger as we clean up problems of the past."
But the possibility that the RBS group may be taken over completely by the government looks increasingly more likely.
UTV business editor Jamie Delargy explained that politicians at Westminster see buying out the bank completely as a potential method of giving a much needed boost to the economy.
"Coalition Ministers are getting increasingly frustrated with the banks, they want them to lend more," he said.
"It's set up a political battle, the Treasury is thought to be against it, it wants to leave the bank under private sector control but there are other ministers who are saying this model hasn't worked, let's change it."