Nationalised British bank Northern Rock says chief quits

4th November 2010, Comments 0 comments

British state-owned bank Northern Rock on Thursday announced the resignation of its chief executive.

Gary Hoffman is stepping down with immediate effect to become chief executive of NBNK Investments -- a new banking start-up, Northern Rock said in a statement.

"We have achieved a great deal together at Northern Rock in the last couple of years in the best interests of tax payers," Hoffman added.

"I have enjoyed my time with Northern Rock immensely. However, it is now time for me to take on a new challenge."

Northern Rock said that Ron Sandler will revert from non executive to executive chairman to provide continuity of leadership.

Hoffman's resignation comes one day after Britain's state-rescued Lloyds bank announced it had poached Santander UK head Antonio Horta-Osorio to be its new chief executive.

Spanish-owned Santander UK named his replacement as Ana Patricia Botin, who is the daughter of Santander's executive chairman and will become the first female chief executive of a British retail bank.

The departure of Eric Daniels as Lloyds' chief executive 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 succeeded by investment division head Bob Diamond next year, while HSBC's Michael Geoghegan will be also replaced by its investment chief Stuart Gulliver.

Northern Rock, meanwhile, plunged into crisis in mid-September 2007 when it was forced to seek emergency assistance from the Bank of England. That sparked the first run on a British bank in recent history.

To avert meltdown, the British government agreed in December 2007 to guarantee all customer deposits and then later took the bank over in early 2008 to prevent its collapse.

The lender was broken up into two parts at the start of this year, forming a so-called "good bank" that continues its healthy businesses and a "bad bank" management company to run down the remaining assets.

© 2010 AFP

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