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Northern Rock chairman quits

Northern Rock chairman Matt Ridley has stepped down as a result of his role in the lender’s crisis and will be replaced by former Bupa and Standard Chartered chairman Bryan Sanderson.

According to a statement from Northern Rock, the board had asked him to remain in his role as chairman until the new funding arrangements were in place and until he had represented the lender before the Treasury select committee on Tuesday.

The bank has confirmed that Bryan Sanderson – a former chairman of Bupa and of Standard Chartered – will take over as chairman once he is approved by the FSA.

Northern Rock’s statement says: “He and the board now believe that in the interests of all stakeholders in the company, the time is right to accept his resignation as a director and chairman of the company.”

Liberal Democrat acting leader and shadow chancellor Vince Cable MP says that the Government should have made Ridley’s departure a condition of its loan, rather than waiting for him to go.

He says: “Furthermore there are other directors, including Derek Wanless, who are equally culpable. All of the senior management of the company led by Mr Applegarth should have been cleared out on day one.

“I nonetheless welcome this step as belated recognition that somebody in Northern Rock should be held accountable for its failures and for the exposure of public money which is now at risk.”

At Tuesday’s TSC meeting, non-executive director Ian Gibson said that all members of the board were asked if they were willing to make their resignations available on August 30, if it helped a possible support offer, and all of them did.

He said their resignations were then considered again between September 14 and September 18 – during the run on the bank – and both Ridley and chief executive Adam Applegarth said they would be happy to resign if required.

Northern Rock senior independent director Sir Ian Gibson says: “The board is delighted to welcome Bryan Sanderson to the company. He has a wealth of experience in business, banking and working with government that will prove invaluable to Northern Rock when considering future strategic options. I want to thank Matt Ridley for his hard work as chairman since 2004 and particularly for his commitment during the very difficult circumstances of the last few months.”

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