Chairman of Northern Rock quits
November 11, 2007
The chairman of stricken bank Northern Rock, which had enjoyed a reputation as the nation’s fifth largest mortgage lender, has now quit following the turmoil that the bank has been experiencing over recent weeks.
After discovering that the bank had taken an emergency loan from the Bank of England any of its 1.5 million savers withdrew over two billion pounds in total from the bank amidst fears that it was on the verge of collapse. Share prices also plummeted over a period of days, and the reputation of the bank took a battering that many say is impossible to recover from.
Dr Matt Ridley has been on the board of Northern Rock since 1994, and has been chairman of the group for over three years. According to reports Dr Ridley did offer his resignation in September, when the crisis occurred, but officials asked him to stay on at that time whilst new financing was being secured. He faced tough grilling at the time from a Treasury Select Committee with MPs wanting to know why he was ‘clinging to office’.
Officials from the bank have now stated that the time is right to accept the resignation of Dr Ridley, who earned a salary of around £300,000 last year, and whose father, Viscount Ridley, was a former chairman of the group. One official from the group stated: “He and the board now believe that the time is right to accept his resignation as a chairman and director of the company.”
Ridley will be replaced by Brian Sanderson, who is a former chairman of Standard Chartered Bank and also of Bupa. Northern Rock officials state that they look forward to welcoming Sanderson to the board. However, he still has to gain approval from the Financial Services Authority and until this time Dr Ridley will remain in place.
Alan Wright
11th November 2007
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