Northern Rock chairman resigns

by Gill Montia

Story link: Northern Rock chairman resigns

The chairman of Northern Rock, the beleaguered mortgage bank, has resigned.

In recent weeks, Matt Ridley has been answerable for Northern Rock’s strategy, which led to last month’s run on the bank and the subsequent loss of confidence in the business.

In his defence, Mr Ridley has agued that he and other directors were not solely to blame for the problems encountered by Northern Rock.

He has protested that the sudden shortage of credit on the money markets that left savers queuing to withdraw their funds was unforeseen.

However, some of the chairman’s critics believe that it was foreseeable and have questioned whether Mr Ridley’s lack of banking experience was instrumental in the crisis; he has gained much of his reputation as a full-time author and zoologist.

Northern Rock paid its chairman £300,000 a year but the statement about his departure did not divulge whether some sort of payoff was involved.

Until today it had been understood that Mr Ridley would remain in post until new funding arrangements were in place and he had appeared before the Treasury Select Committee.

Bryan Sanderson, a former chairman of Standard Chartered and BUPA, has been named as his successor.

Mr Sanderson resigned from Standard Chartered last November and will take over at Northern Rock as soon as the appointment has the approval of the Financial Services Authority.