Lloyds bank poaches Santander UK head for new chief

3rd November 2010, Comments 0 comments

Britain's state-rescued Lloyds bank on Wednesday poached Santander UK chief Antonio Horta-Osorio to be its new chief, as the sector completed a management clearout following the global financial crisis.

Lloyds Banking Group (LBG), which is slowly recovering after a massive government bailout, announced in a statement that the 46-year-old Portuguese national would replace current chief executive Eric Daniels in March 2011.

City investors welcomed the news, sending LBG shares surging by almost three percent higher on the London stock market, which was down 0.20 percent in late afternoon deals.

Horta-Osorio, speaking after his appointment, said he made the "emotional decision" to leave Santander to seek the "huge challenge" of the top job at Lloyds.

"I really like the UK and its culture and diversity," he told reporters on a conference call.

"This is the country my wife and I decided we wanted to see our children grow and wanted to stay here for the foreseeable future."

Horta-Osorio takes the reins as the bank shows positive signs that the government could make a profit on its 41-percent stake.

Lloyds revealed on Tuesday that it had experienced a "good" third quarter thanks to rising revenues, alongside lower costs and impairments, and signalled it would turn a profit this year after paying down some of its debts.

The confirmed departure of Daniels will means that all the top management at Britain's major retail banks have now been swept away since the global financial crisis ravaged the sector.

Barclays' chief executive John Varley is due to be suceeded by investment division head Bob Diamond next year, while HSBC's Michael Geoghegan will be also replaced by its investment chief Stuart Gulliver.

"I have known Antonio over the years and I'm pleased he has been appointed as my successor," Daniels added on Wednesday.

Horta-Osorio, who has been Santander UK chief since 2006, oversaw the group's rapid expansion in recent years as it bought rival Alliance & Leicester, as well as the savings division of Bradford & Bingley.

In a separate statement, Santander UK said that Horta-Osorio would resign on December 31 to allow an orderly handover to a new successor.

"I would like to thank Antonio for his significant contribution over the last four and half years as chief executive," said Santander UK chairman Lord Terry Burns.

"He has been at the heart of the successful turnaround and transformation of the bank under Santander's ownership.

"He has built a strong management team at Santander UK and consequently the bank is well-positioned for the future."

The group added it would make an announcement "in due course" over the appointment of his successor.

A source close to the bank said that Ana Patricia Botin, current chairwoman of Spanish bank and Santander division Banesto, was being lined up to replace Horta-Osorio.

An announcement was expected by Thursday on the appointment of Botin, who is the daughter of Santander executive chairman Emilio Botin.

LBG's outgoing chief Daniels had faced criticism after overseeing the 2008 government-brokered takeover of former rival Halifax Bank of Scotland (HBOS), which was saddled with high-risk investments in the property sector.

Lloyds suffered huge losses in 2008 and 2009, as bad debts rocketed in the wake of the HBOS rescue and a deep recession. However, it bounced back into profit in the first half of 2010, as bad debts fell sharply.

Daniels had already announced in September that he intended to step down in 2011.

Spanish bank Santander entered the British retail banking market with the 2004 purchase of lender Abbey National, which was subsequently changed to Abbey.

The British division rebranded as Santander UK earlier this year, after the A&L and B&B deals. It has also agreed to buy 318 brances from state-rescued rival Royal Bank of Scotland.

© 2010 AFP

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