As RBS' ATM "Glitch" Enters Fifth Day, The Bailed Out Bank Issues A Statement

Tyler Durden's picture




 

Over the past week, various entities controlled by bailed out UK-bank RBS, focusing primarily on NatWest, have seen clients unable to access virtually any of their funds, perform any financial transactions, or even get an accurate reading of their assets. The official reason: "system outage"... yet as the outage drags on inexplicably for the 5th consecutive day, the anger grows, as does speculation that there may be more sinister reasons involved for the cash hold up than a mere computer bug. 

The Scotsman.com reports:

BRANCHES of Royal Bank of Scotland will open on a Sunday for the first time this weekend as RBS Group struggles to deal with the aftermath of technical problems that have affected up to 12 million customers. The taxpayer-owned group took the unprecedented step of extending the hours of more than 1,000 RBS and NatWest branches that normally open on a Saturday to 6pm, and opening them again tomorrow morning, as it faces an angry backlash from people unable to access accounts, withdraw wages or pay bills and mortgage payments.

 

The difficulties, which have hit NatWest, RBS and Ulster Bank users, are entering their fifth day. RBS said the backlog had been caused by a “system outage” on Tuesday, and that it was “working around the clock” to resolve it.

 

Some customers said their home purchases or holiday plans had been plunged into chaos by the glitches, while others vowed to switch banking provider. Fears have been raised that thousands could be hit with penalty charges if their regular bill payments, such as for their mortgage, are affected. Consumer groups called on the banking behemoth to provide “appropriate compensation” to those customers who suffer as a consequence of the “failure”.

 

It appears the difficulties have hit hardest at NatWest, which has more than 7.5m personal banking customers. RBS Group said it could not tell how many had been affected as it was not possible to know when they were expecting payments into their accounts.

Problems are spreading beyond just RBS:

A group spokeswoman said it was “too early to say” how many RBS or NatWest customers in Scotland had been affected, but added: “The RBS problems seem to have been solved. The backlog being dealt with now has to do with NatWest customers predominantly.”

However, the problem is not confined to RBS account holders. Some non-customers are suffering as their employers use the group, and have not received their salary payments. Customers of RBS Group’s banking transaction services include the Government Banking Service, which looks after the balances of hundreds of public sector organisations, from government departments through to executive agencies.

 

RBS Group, which has 317 RBS and six NatWest branches in Scotland, said 192 RBS branches would be open today, a number of which would stay open until 6pm. Across the UK, hundreds more branches will extend their hours tonight, as well as opening tomorrow between 9am and 12 noon.

It is only logical that after Schdoinger currency, and Schrodinger Egyptian president, we no whave Schrodinger's Money: it's there... and yet it isn't.

Customers have reported a plethora of problems. Account balances have not been updated properly, meaning credit and debit payments are not showing up as quickly as they should, although RBS said the money was “in the system”. People going into their branch yesterday could not necessarily see the most up-to-date information on their balances, although staff were said to be “geared up” to help.

It is still unclear how much longer the "glitch" will persist:

Susan Allen, customer services director for RBS NatWest retail, said it was difficult to say exactly when all the problems would be resolved. She said they had been due to “an error in our system which we believe we have now fixed but we are clearing the backlog”.

The situation has gotten so dire that RBS itself has just issued a press release. The message is the usual one: keep calm, all is well.

Message to Customers from Stephen Hester RBS Group Chief Executive

 

23rd June 2012

 

The problems of the past few days have caused disruption and inconvenience for our customers as well as for many customers of other banks.

 

I am very sorry for the difficulties people are experiencing. Our customers rely on us day in and day out to get things right, and on this occasion we have let them down. This should not have happened.

 

Right now my top priority, and the priority of the entire RBS Group, is to fix these problems and put things right for our customers.

 

This is taking time, but I want to reassure people that we are working around the clock to resolve these problems as quickly as we are able.

 

I also want to be clear that where our customers are facing hardship or difficulty we can and will help them. Our staff have already helped thousands of customers to access cash and we will continue to provide this service on a 24 hour basis while we work to resolve the problems.

 

I also want to reassure customers that no one will be left permanently out of pocket as a result of this, and again, they should contact us directly about this.

 

We have double the usual number of staff in our call centres, and for the first time ever we will open 1,200 branches across the country on a Sunday from 9am to 12pm.

 

Once again I am very sorry for the inconvenience.

Luckily, Greece is (still) in the Eurozone. Or else all those trumpeted preparations for a pan-European bank run and capital controls may have been put into play.

Then again, with ATM friends such as the above, who needs Greeks bearing presents or Trojan horses?

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Sat, 06/23/2012 - 13:20 | 2553907 RockyRacoon
RockyRacoon's picture

'Tis a harbinger of things to come...

Sat, 06/23/2012 - 13:23 | 2553918 Popo
Popo's picture

If you have money in NatWest or Barclay's: GET YOUR MONEY NOW. If this isn't just a "glitch", this could spread very fast.

Sat, 06/23/2012 - 13:26 | 2553928 SilverTree
SilverTree's picture

"And the battle has just begun"

Sat, 06/23/2012 - 13:28 | 2553935 AldousHuxley
AldousHuxley's picture

A lot of BS in banking... YouBS aka UBS in Switzerland OurBS aka RBS in UK WhyBS aka YBS in UK TheBS aka DBS in Singapore EatBS aka EBS in Ireland GBS in South Africa but no shit is like American bull shit. MBS

Sat, 06/23/2012 - 13:42 | 2553973 TruthInSunshine
TruthInSunshine's picture

'Tis just a glitch in the Matrix. We'll be seeing a lot of glitches. Don't fret.

Deja vu, and good Creditanstalt to each of you.


#TheJonCorzineGoneFishin'Project

Sat, 06/23/2012 - 13:44 | 2553981 Stackers
Stackers's picture

Happy Bank Holiday

Sat, 06/23/2012 - 13:46 | 2553987 palmereldritch
palmereldritch's picture

They can run but they cannot hide.

Sat, 06/23/2012 - 13:59 | 2554020 Bay of Pigs
Bay of Pigs's picture

Thank goodness we've 'decoupled' here in the US....lol

Sat, 06/23/2012 - 14:51 | 2554203 Cruel Aid
Cruel Aid's picture

Too bad they don't have FDIC protection.

They could sleep well.

Sat, 06/23/2012 - 15:52 | 2554361 sessinpo
sessinpo's picture

As if FDIC really meant anything.

2011, the DIF (Deposti Insurance Fund) was $19.2 billion.  BOA alone has at least $1 trillion in deposits. Let's see FDIC cover that.

Sat, 06/23/2012 - 16:23 | 2554433 Pure Evil
Pure Evil's picture

Maybe they got Stuxnet'ed or Flamed by the Argentinians.

Sat, 06/23/2012 - 17:00 | 2554498 Gief Gold Plox
Gief Gold Plox's picture

Ever-since I learned about how fractional reserve banking works, I started getting any and all money I receive out of the banks. It's a flawed system and in order to preserve your savings you must do what you can to not perpetuate it. Everyone in the EU, even if they dare not invest savings into tangible assets like precious metals, should get their money out of the failing system. At the very least diversify into foreign currencies to spread out the risk. At this point things can (and will) only get worse.

Sat, 06/23/2012 - 17:43 | 2554598 shuckster
shuckster's picture

Not to mention, most banks are levered 100:1, so some guy pulling out $550 for a Vegas weekend trip is enough to break the whole system

Sat, 06/23/2012 - 19:57 | 2554798 Matt
Matt's picture

Perhaps the glitch is that the computer software was not designed to handle the possibility of there being less than 1 percent paper money to deman deposits, so they froze up. 

ERROR ERROR ERROR DANGER WILL ROBINSON

pay bill -> NSF message.

Call Customer Service

"what do you mean Non-Sufficient Funds? I have $10,000 in there!"

"oh no sir, your account is fine. We here at the bank seem to have non-sufficient funds. I apologize for any inconvenience this causes you."

Sat, 06/23/2012 - 23:08 | 2555081 Osmium
Osmium's picture

Ah yes, divide by zero error.

Sat, 06/23/2012 - 23:35 | 2555109 Harlequin001
Harlequin001's picture

I don't see this being anything more than a computer problem. When all's said and done, the UK can print money if necessary to maintain liquidity in its banking system, for now.

If it was a Eurozone country I would be far more worried, but then I can afford to be, I hold no assets of any real worth in the banking system anyway...

But I don't see it as being THE critical problem at this stage...

Sun, 06/24/2012 - 11:30 | 2555713 tonyw
tonyw's picture

My contacts inside RBS tell me it is down to a software error in a recent upgrade that was not spotted in testing. The development of this software has been outsourced to RBS's office in Chennai (called Madras and the centre of the British empire's admin for India)). It will cost them millions but this is certainly not anything more than a typical outsourcing cock-up. The UK based staff on this have been "let go" and replaced with much cheaper Indian staff. Now these newer staff will not have had the years of experience of the old staff, but hey whatever costs - reduced and management bonuses paid.

RBS have also outsourced more work to Singapore using the ABN-AMRO staff they acquired so they can again "save money" and help justify the ABN-AMRO purchase.

Sat, 06/23/2012 - 17:02 | 2554504 Abitdodgie
Abitdodgie's picture

The FDIC only insure 2 cents on the dollar now so good luck with that insurance.

Sat, 06/23/2012 - 23:55 | 2555131 mjcOH1
mjcOH1's picture

"As if FDIC really meant anything.

2011, the DIF (Deposti Insurance Fund) was $19.2 billion.  BOA alone has at least $1 trillion in deposits. Let's see FDIC cover that."

 

That might require another roll of paper.

Sat, 06/23/2012 - 13:58 | 2554017 LULZBank
LULZBank's picture

A lot of BS in banking... YouBS aka UBS in Switzerland OurBS aka RBS in UK WhyBS aka YBS in UK TheBS aka DBS in Singapore EatBS aka EBS in Ireland GBS in South Africa but no shit is like American bull shit. MBS

Haha.. LULZ Supremo!!

Cant give you enough +1s.

Sat, 06/23/2012 - 18:46 | 2554701 Thomas
Thomas's picture

I think this is just a glitch. Wouldn't play out this way if it were other, at least not at the start.

Sat, 06/23/2012 - 16:01 | 2554391 mt paul
mt paul's picture

you can't spell banks

with out BS...

Sat, 06/23/2012 - 14:54 | 2554215 Kaiser Sousa
Kaiser Sousa's picture

Yeah, a "glitch"....that's it I'm sure....
Well, last time I checked all my shinny Silver is resting peacefully in a undisclosed location....
FUCK U COCKSUCKER BANKERS!!!!!!!!!!!

Sat, 06/23/2012 - 18:08 | 2554646 shuckster
shuckster's picture

We have ways of making you tell us where the silver is

Sun, 06/24/2012 - 17:51 | 2556437 BigJim
BigJim's picture

And we have ways of lying.

Sat, 06/23/2012 - 13:37 | 2553963 pop goes the weasel
pop goes the weasel's picture

I withdrew a £1000 yesterday in branch, then went back an hour later to withdraw another 3k from my current account, just to be on the safe side. I was told i could not have 3k, as they did not know how much i had in my account. I said well you just let me take £1000 out an hour ago. She said I trusted you had it in but cant do it again, you can have a max of £300. Aafter some argueing I managed to get another £1k and was told I could not go to another branch and try for any more as it would flag up and they would deny me any more.

Sat, 06/23/2012 - 14:03 | 2554029 JPM Hater001
JPM Hater001's picture

What do you think the chances are the CIA has a new toy?

Sat, 06/23/2012 - 17:18 | 2554542 Peter Pan
Peter Pan's picture

Fiat + Fractional Banking = Fear + Failure.

It is time we realised how fragile the economic system is due both to its poor construction and even worse management.

It is time people prepared for the possibility of some real mayhem because one day there will no longer be any warnings such as the episode we now have with RBS.

Sat, 06/23/2012 - 14:17 | 2554039 resurger
resurger's picture

Can you wire all your cash and close your A/C? Or there is a limit on that too?

Did you get an Avenger Towel?

Sat, 06/23/2012 - 14:18 | 2554072 pop goes the weasel
pop goes the weasel's picture

My internet banking is down aswell, can see balances but cant do anything with them.

Sat, 06/23/2012 - 14:31 | 2554113 resurger
resurger's picture

I guess what they are doing to you is so fucking unfair, why the fuck there is a limit on your withdrawls when you visit your bank HQ or a branch, you ought to be able to withdraw all you money on spot. I can understand that there is a limit on ATM bank withdrawls to protect you from theft, but i just dont understand why your bank wont give you all your money on demand (I DONT BELIEVE THIS WE CANT SEE YOUR ACCOUNT, sorry for CAP's but this is serious). Is there a policy that says you can't withdraw all your cash in the U.K?

Either way, good luck .. it seems the bank depositors are coming out of the woodwork to claim the hostages.

Sat, 06/23/2012 - 17:12 | 2554523 css1971
css1971's picture

See, when you put money in a bank... IT'S NOT YOUR MONEY ANYMORE. IT'S THEIR MONEY.

That's the legal position. You loaned the money to them, they can do with it what they like and they can restrict your access to it according to the terms and conditions of the account, the small print of which will say "nah nah nah nah nah!".

Sat, 06/23/2012 - 17:25 | 2554555 NumNutt
NumNutt's picture

I live in the U.S. and about 5 years ago I tried to pull 30,000 in cash out of my account and was told I couldn't. I had the money, and the teller could see the balance. I was told they could not do that amount without a weeks written notice as they did not have enough cash on hand that would allow them to do that transaction, and still service other customers. They recieve a cash delivery 1 time a week, and would get an extra amount to cover a large withdraw like that, this was told to me by the bank manager.  I always keep this in the back of my mind when the fear of a bank run is running high. They don't keep to much cash on hand, and they can run out, regardless of what the numbers say your account has.

Sat, 06/23/2012 - 18:28 | 2554680 Oracle of Kypseli
Oracle of Kypseli's picture

All printed paper dollars are only a few billion. If a small % of people take their deposits out in cash, lights out. 

Sat, 06/23/2012 - 20:04 | 2554806 BidnessMan
BidnessMan's picture

About seven trillion in US dollars, but only about 1 trillion in actual currency.  And about half of that is outside the US.  

So be in the first 7% of the bank line .... 

Sat, 06/23/2012 - 21:29 | 2554938 TruthInSunshine
TruthInSunshine's picture

I believe based on recollection (if I'm wrong regarding what I'm about to state please correct me) that approximately 3% of the total U.S. money base exists in physical form, whether coins or cotton/linen Federal Reserve Notes.

Sun, 06/24/2012 - 17:54 | 2556441 BigJim
BigJim's picture

It's roughly the same in the UK.

Sat, 06/23/2012 - 16:03 | 2554395 mt paul
mt paul's picture

my silver is stacked 

in the back of the shed...

still gathering dust

Sat, 06/23/2012 - 16:52 | 2554481 Republicae
Republicae's picture

Oh, what's that address again?

Sat, 06/23/2012 - 20:16 | 2554400 mt paul
mt paul's picture

seal point..

off of walrus way...

Sun, 06/24/2012 - 08:57 | 2555392 mvsjcl
mvsjcl's picture

On my way via Igloo Drive.

Sat, 06/23/2012 - 18:11 | 2554649 shuckster
shuckster's picture

The other day, it took a whole week for a check deposited into an ATM to hit my bank account - that is, I deposited it on Friday and it wasn't available til the next Friday 

Sat, 06/23/2012 - 13:51 | 2553992 resurger
resurger's picture

Is winter coming early this year in the North?!

Fuck you John Snow, you have to defend us from the Zombie banks instead of shagging ygritte

 

Sat, 06/23/2012 - 22:46 | 2555046 Buck Johnson
Buck Johnson's picture

This isn't a glitch, no way it's a glitch.  Because for one it took 5 days and still continue to have problems.  If a bank was having trouble this big with it's milions of customers, it would have reverted back to it's old program and gotten rid of the update or whatever.  Then they would slowly update the system one branch at a time in order to make sure it's working properly.  After seeing how much debt to GDP that the UK have, I think that most of the UK's banks are insolvent and they are in a liquidity crunch.  5 days in the business world especially the banking world is tantamount to forever.  Because this threatens the bank in a way that when or ever the issue is "fixed" people will take there money out of this bank and to another one. 

Sat, 06/23/2012 - 23:20 | 2555095 bigkahuna
bigkahuna's picture

Yep. 1 day of this is enough to make customers angry and/or nervous. 5 days is a death sentence. It might as well go out of business.

Sun, 06/24/2012 - 19:56 | 2556646 jumbo maverick
jumbo maverick's picture

It might as well go out of business or ask for a bailout

Sun, 06/24/2012 - 09:09 | 2555408 mvsjcl
mvsjcl's picture

Agreed. As a programmer of many years for a Fortune 500 company, implementing countless upgrades, cognizent of the myriad QA steps involved, the countless contingency scenarios outlined should the unthinkable occur--especially with such a high impact, customer-facing application--this is complete and utter BULLSHIT.

Sat, 06/23/2012 - 13:27 | 2553920 mikla
mikla's picture

+1

People will re-wire their lives without intimate expectations/needs with banking institutions.

In the "short-term" we will see "economic friction".  In the "long-term" we will see restoration of sanity as mal-investment and market-distortions are removed.

The Economic System is intended to provide capital liquidity, which is essential for any "free society", for social mobility, for market economies, for social prosperity as "good ideas" can be pursued.

However, since our current Economic System now merely represents oppression, market distortions, and public fleecing, it should surprise no-one that people worldwide will remove themselves (as the "official" economy in its current state serves no Public Good whatsoever).

Sat, 06/23/2012 - 17:42 | 2554593 New_Meat
New_Meat's picture

mikla:

"in the long term we're all dead"

Your comments are appropriate for the macro view.

Here in the pig-sty, we really worry about the micro view, where the disruptions are rather ... er ... disruptive.  Like no drinking water.

"The Economic System is intended to provide capital liquidity,..."

Do you have an MS. in Economics, I doubt that you have achieved a PhD. in same.  That is probably to your credit.

Public Good?????

go figure, I can't

- Ned

Sat, 06/23/2012 - 18:30 | 2554672 mikla
mikla's picture

I accept that the "micro-view" is important:  "What's for dinner?" is pretty important today.  Agreed.

However, the "macro-view" is not-that-far-away.  The upcoming "Bank Holiday" will probably last five-days-or-so.  It's a new-economy on the other side.  Probably all this before the US Presidential election.

My "macro-view" reference is simpler:  You'll make extra-dinner and share with your neighbors.  There will be more "block-parties" and "church-get-togethers".  People will share what they grew in their back-yard, because anybody with a zuchinni plant has too much.  When you need your roof repaired, it will be a handshake-transaction, or more likely, a "gift-economy" which is epitomized through "Barn-Raisings".

Yes, this is a localized-example.  But, it's not micro.  It's macro, because that's how it will be done *everywhere*.  It's a different economic system (e.g., the opposite of "Centralization", which is in its death-throes.)

Those things are simple.  Effective.  Efficient.  And, more importantly, they can't be leveraged, nor securitized, nor taxed.

It's not a return to the "Dark Ages".  It's not collectivism either.  Rather, your neighbors are roofers, doctors, child-care-providers, cooks, and hobbyist gardeners.  When we figure that out, without a "third-party" siphening from every transaction (removing all value from all transactions), all our quality-of-life will increase, because our neighbors already have-all-the-makings of a fine-and-prosperous economy.

In reference to the specific quote:

"The Economic System is intended to provide capital liquidity,..."

This, of course, is a definition-of-terms problem.  There are many parties with differing wishes.  For example, I concede that, "Those In Charge" view the "Economic System" as a mechanism for siphoning-and-control.  Nothing more.

In contrast, I was referencing the social aspect, or, "Why would an individual subscribe to such a system?"  There are many answers, but access-to-capital was the single-most-important-concept that brought us out of the Feudal System, which is merely an economy-based-on-labor (not capital).

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