An error which saw German development bank KfW mistakenly transfer billions to four other banks is considerably larger than first thought, Handelsblatt has learned. Early reports of the incident suggested up to €6 billion was transferred. In fact, the total sum was €7.6 billion.
The incident, which took place in late February, is thought to have been the result of a rare combination of human error and malfunctions in the bank’s payment systems. A programming fault took place at the same time as maintenance work on payment systems, all of which meant that payments to other banks were executed multiple times, continuing on an infinite loop until manually stopped.
KfW did not incur financial losses, since the money was immediately returned by the recipient banks. But there has been considerable damage to the state-owned development bank’s image, particularly since it already has a bad track record of IT problems and errors.