By Alex MacDonald 
 

LONDON--U.K. financial authorities fined Royal Bank of Scotland Group PLC (RBS) 56 million pounds ($87.8 million) for information technology failures that meant 6.5 million customers couldn't access banking services for several weeks during the summer of 2012.

The Financial Conduct Authority said Thursday it fined RBS and two of its affiliates, National Westminster Bank PLC, or NatWest, and Ulster Bank Ltd., GBP42 million, while the Prudential Regulation Authority fined the bank GBP14 million.

The FCA said the bank was fined for failing to put in place resilient IT systems that could withstand, or minimize the risk of, IT failures, despite spending over GBP1 billion annually to maintain IT infrastructure.

RBS has agreed to pay the fines, for which provisions were already set aside.

"Our IT failure in the summer of 2012 revealed unacceptable weaknesses in our systems and caused significant stress for many of our customers. As I did back then, I again want to apologize to all customers in the U.K. and Ireland that we let down two and a half years ago," RBS Chairman Philip Hampton said in a statement.

The IT incident was the result of a software compatibility problem.

Over the course of several weeks, customers couldn't use online banking facilities to access their accounts or obtain accurate account balances from ATMs. Customer were also unable to make timely mortgage payments and were left without cash in foreign countries.

The bank applied incorrect credit and debit interest to customers' accounts and produced inaccurate bank statements, while other organizations were unable to meet their payroll commitments or finalize their audited accounts.

"The problems arose due to failures at many levels within the RBS Group to identify and manage the risks which can flow from disruptive IT incidents," said Tracey McDermott, director of enforcement and financial crime at the FCA. "We expect all firms to focus on how they ensure that they can meet the requirements of their customers when looking at their IT strategies and policies."

The FCA acknowledged that since the IT Incident in June 2012, the bank has taken significant steps to address the failings in its IT systems and controls. RBS spent GBP750 million between 2013 and 2015 to enhance the security and resilience of its IT systems.

Write to Alex MacDonald at alex.macdonald@dowjones.com

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