IBM takes blame for massive bank system failure

Outage caused when an employee didn't follow correct procedures, IBM said

IBM took responsibility for a major IT system failure suffered by one of Singapore's largest banks on July 5, saying an employee's error caused the outage.

In a statement released Tuesday, IBM said problems started when software monitoring tools detected "instability" within DBS Bank's storage system. While the storage system remained "fully functional," IBM employees initiated a recovery process to fix the issue.

"Unfortunately, a failure to apply the correct procedure inadvertently caused the service outage," IBM said, adding that no data was lost.

The outage knocked DBS' IT systems offline for seven hours, leaving customers unable to withdraw money from automatic teller machines. All of the bank's commercial and consumer banking systems were affected, although no data was lost, the bank said at the time.

Much of DBS' IT systems are managed by IBM under a S$1.2 billion [B] (US$868 million [M]) outsourcing agreement signed in 2002.

IBM and DBS are taking steps to prevent a repeat of the July 5 system failure.

IBM has "taken steps to enhance training of our personnel related to current procedures and brought in experts from our global team to provide further assistance," the statement said. In addition, IBM and DBS are taking "additional actions to increase the resiliency and redundancy of this part of DBS' infrastructure," it said.

A DBS spokeswoman did not immediately reply to an e-mail seeking comment on the IBM statement.

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Sumner Lemon

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