DBS faces regulatory sanctions and public backlash after series of outages
DBS, Singapore’s largest bank, has been hit by a series of digital banking disruptions in 2023, affecting millions of customers and businesses. The most recent incident occurred on Oct 14, when a data centre outage caused the bank’s online and mobile banking platforms, as well as its ATMs and payment services, to be unavailable for several hours.
The Monetary Authority of Singapore (MAS) has imposed regulatory sanctions on DBS, barring it from any acquisitions of new business ventures and from undertaking non-essential IT changes for six months. It also prohibited the bank from reducing the size of its branch and ATM networks, to ensure adequate alternative channels for its customers in the event of further disruptions.
The bank has faced public backlash and criticism for its poor handling of the incidents, which have eroded customer trust and confidence. Some customers have reported losing money or missing payments due to the outages, while others have expressed frustration and dissatisfaction with the bank’s communication and service recovery efforts.
DBS chairman apologises and says senior management will be held accountable
In a statement issued on Wednesday (Nov 1), DBS chairman Peter Seah acknowledged that the bank had failed to live up to its own standards and customers’ expectations, and apologised for the inconvenience and distress caused by the disruptions. He said that as an acknowledgement that the bank could have done better, senior management will be held accountable, and this will be reflected in their compensation.
He also said that the board and management of DBS are addressing the issues at hand with utmost priority, and have rolled out a comprehensive roadmap to improve technology resiliency. The roadmap involves both immediate and longer-term measures to strengthen technology governance, people and leadership, as well as systems and processes.
DBS appoints Accenture to conduct independent review of its IT systems
DBS has appointed consultancy firm Accenture as an independent third party to review its IT systems and processes, following a day-long service outage in March that affected its core banking system. The review was completed in August, and identified four main areas of weakness: technology risk governance and oversight, incident management, system resilience, and change management.
The findings of the Accenture review were also corroborated against recent disruptions – the Sep 26 incident impacting FAST/PayNow transactions, the Oct 14 data centre incident, as well as the Oct 20 incident when some customers had intermittent access to DBS PayLah!.
DBS said it believes that key gaps and deficiencies have been identified, and is implementing remedial measures to address them. These include allocating a special budget of S$80 million to enhance system resiliency, forming a new sub-committee to oversee technology risk, splitting its technology and operations functions into two separate units, creating a new head of enterprise architecture site reliability engineering role, and establishing a new quality assurance function within the engineering team.
The bank expects these improvements to be reflected or completed over the next 12 to 24 months.
