28 May 2018

NAB Group CEO Andrew Thorburn – Interview with Neil Mitchell, 3AW

E & O E – PROOF ONLY

NEIL MITCHELL: Problems with a NAB outage on the weekend, we are having a few of these aren’t we? We’ve had problems with Telstra, it’s a bit of a cyber horror run at the moment. I am told the machinery used to get a Medicare or healthcare rebate went down as well. Cafes, markets, there’s one trader in one of the papers today saying it cost him $15,000. On the line, he’s called in, is the Chief Executive of the National Australia Bank, Andrew Thorburn. Good morning.

ANDREW THORBURN: Good morning Neil.

MITCHELL: Do you know what happened?

THORBURN: Yes, we do now. It was a very significant outage unfortunately on Saturday morning. A piece of our infrastructure failed. Now it was part of a planned change we were doing and that caused a power outage and then our core services went down for six hours. So I just wanted to ring in – and thank you for giving me the time Neil – to apologise to our customers for the mistake that we made and the impact it had on them.

MITCHELL: Six hours, so how many people would that affect?

THORBURN: Well there were a lot of customers affected because of the time. It was Saturday morning. I was advised just before 8am. They started to come up around 1230, but they weren’t fully up until around 2 or 230pm. So there would have been many, many thousands of customers. Not just retail customers, but small business customers of course who were serving customers, they were impacted as well. It was a very unfortunate event. It’s rare, but it was terrible timing and I really do apologise for that.

MITCHELL: And what did it affect?

THORBURN: Well it affected most of our core services like internet, mobile, ATMs, EFTPOS. Basically all our core services went down over that time. And whilst our team really rallied and got it back up as quickly as possible, it’s still not good enough. The impact on our customers was significant. And that’s not acceptable to us.

One of the things we are doing Neil, is we will give compensation to customers if financial losses occurred. For customers who have a banker we will be contacting them, particularly business customers. But if other customers feel that they are out of pocket, we don’t want that to be the case and they can phone 1800 152 015. If they phone that line we’ve got people who can help them with that process.

MITCHELL: But what sort of level of compensation? There’s a person in The Age today saying it cost them $15,000 at their Camberwell market stall. Would they be eligible, possibly, to get that back?

THORBURN: Well we don’t want people to be out of pocket, so we just need to listen to the customer, and where they have lost profit and where we can see that is the case. We do give discretion to bankers to be able to compensate customers because we do want to repay them if they can show us that there has been lost profit because of the outage.

So yes, we’d like to talk to every customer, and compensate them through that process.

MITCHELL: So if I can show you that my average Saturday takings are this and you can show me it is this minus X, you will look at it?

THORBURN: Yes, yes… yes we would absolutely.

MITCHELL: This could cost you millions…

THORBURN: Yes, look, well we have to be accountable for it Neil. We have made an error, it has affected our customers and apart from understanding how it happened and preventing it from happening again (which is obviously happening in the bank) and saying sorry, I think we have to go further and if there is financial loss, we wish to compensate the customer.

MITCHELL: Do you have any idea what it could be?

THORBURN: Well, we don’t yet of course because we don’t know the number of customers. We don’t know the people who have been affected, so we need those people to talk to us – the customers. Some of them will be our bankers- those who have relationship clients. They will be contacting them. And it could be millions of dollars, and if that’s the case, that is what we will be paying.

MITCHELL: And what caused it again?

THORBURN: Well, it was a planned change in one significant piece of infrastructure and that planned change did not go as it was planned to have gone. It caused a power outage, and that power outage then caused core services to go down. So, that’s how it happened and we realised that quite quickly, hence we were able to restore it. But once again, it’s just not good enough from our perspective because we want to be 100% reliable.

Our systems are up around 99% of the time, but we need to get that up to 100.

MITCHELL: Thank you very much for your time.

THORBURN: Thanks Neil.

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