Lloyds Banking Group exposed the personal and financial data of up to 447,936 customers during an IT failure on 12 March, according to a letter published on Friday by the UK Treasury Committee.

The incident, caused by a software defect during an overnight system update, allowed users of Lloyds, Halifax and Bank of Scotland apps to briefly view other customers’ transactions. The bank said 114,182 customers clicked on accounts that revealed sensitive information including account details and national insurance numbers.

Lloyds has paid £139,000 in compensation to 3,625 affected customers for distress and inconvenience, and said no financial losses have been identified. The bank added that it had quickly resolved the issue and contacted those impacted.

A Lloyds spokesperson said: “On 12 March, some customers using our app may have briefly seen transactions that were not their own following an IT change. The issue was quickly identified and resolved, and we’ve contacted customers whose transactions may have been visible for that short time.”

The UK Treasury Committee said it had sought further clarification from the bank earlier this month and expects updates within one and six months. Meg Hillier, chair of the committee, said: “Modern banking methods mean we can now perform a variety of tasks on our phones in a matter of seconds… what this incident brings into focus is the fact that there is a trade-off.”

Hillier added that the committee would continue to push banks to be transparent when failures occur, highlighting concerns about the resilience of increasingly digital financial services.

Lloyds has notified regulators including the Financial Conduct Authority, the Prudential Regulation Authority and the Information Commissioner's Office, which said it was aware of the incident and would be making enquiries.

The breach comes as Lloyds continues a multi-year investment in technology under chief executive Charlie Nunn, aimed at transforming the lender into a leading digital banking platform while reducing reliance on physical branches.

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