Leader: Where was Northern Rock's technology?

The crisis at Northern Rock looks like an example of bad planning on many levels. But the bank's use, or possible neglect, of technology could be at the root of many of its problems.

The bank borrowed money from the Bank of England to ensure its own solvency in the face of increasing financial turmoil abroad. So far, so good.

What it then failed to do was manage its customer relationships effectively to calm the fears of its account holders.

Every bank has the information and presumably the resources to reassure each of its customers that their money is safe. Northern Rock appears not to have done this, preferring instead to shout the message out of the branch doors at queues in the street.

The bank's website has been brought to its knees by the weight of online customers trying to get out of Dodge. The site has been so slow it's difficult even to get the customer services number, let alone access an account.

A Northern Rock spokeswoman insisted the poor site performance is purely due to an unexpected increase in traffic, as if that were a reasonable excuse.

If some of the bank's branch buildings fell into the street, would it now be blaming the brickwork? Surely the bank has a duty to provide online customers with access to their accounts and should have laid in emergency capacity to cope with an unexpected spike in traffic. Every seasoned website operator knows this.

There is perhaps a more fundamental aspect to this apparent lack of planning. Banks are known to be highly risk-averse. They generally have systems in place to analyse and predict areas of potential risk.

If such systems existed at Northern Rock and were heeded, surely the bank would have moved its business model out of danger before it needed to go cap in hand to the Bank of England. At least it could have educated the market to prepare for rough waters.

What it did instead was set off a chain of events that doom-mongers say could usher in the next recession in the UK.