A&L names new chairman

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LONDON (Reuters) - Alliance & Leicester (A&L) poached Alan Gillespie from Ulster Bank to take over as its chairman, the British bank said on Wednesday, as it attempts to stabilise in the face of a tough outlook.

Gillespie, who will take up his new post in September, has extensive experience in retail, commercial and investment banking, including 14 years at Goldman Sachs in its corporate advisory and mergers & acquisition unit.

That previous career helped revive speculation A&L under Gillespie could be taken over or join up with smaller lenders, helping lift the bank’s shares.

A&L’s previous chairman Derek Higgs died in April. Its shares have plunged 79 percent in the last year to a record low as its funding costs have jumped and its earnings have fallen amid the credit crunch and tough UK housing market.

It has long been regarded as vulnerable to a takeover, with France’s Credit Agricole , Spain’s Santander and its bigger rivals such as Lloyds TSB all rumoured to have cast an eye in recent years. Its market value has dipped to just under 1 billion pounds.

By 9:25 a.m. A&L shares were up 7.8 percent at 231.5 pence, which analysts attributed to the appointment of an experienced banker and a rebound across the European bank sector as well as the potential for M&A.

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, in 2001. The native of Northern Ireland spent 10 years at Citigroup , specialising in debt capital markets, before moving to Goldman, where he established and was co-head of the European financial institutions group.

He will take over as chairman on September 8, when acting chairman Roy Brown will revert to deputy chairman.

Gillespie said of A&L: "With its distinctive brand and customer franchise and broadly diversified retail and commercial banking businesses, it is well positioned to face the challenging times in the banking industry."

A&L’s profits are expected to drop to 195 million pounds this year, less than half last year’s 399 million, based on a Reuters Estimates average of 15 forecasts. Higher funding costs and losses on risky assets will cut earnings, while revenue will be held back by reducing mortgage lending.

(Reporting by Steve Slater; Editing by David Holmes)

LONDON (Reuters) - Alliance & Leicester (A&L) poached Alan Gillespie from Ulster Bank to take over as its chairman, the British bank said on Wednesday, as it attempts to stabilise in the face of a tough outlook.

Gillespie, who will take up his new post in September, has extensive experience in retail, commercial and investment banking, including 14 years at Goldman Sachs in its corporate advisory and mergers & acquisition unit.

That previous career helped revive speculation A&L under Gillespie could be taken over or join up with smaller lenders, helping lift the bank’s shares.

A&L’s previous chairman Derek Higgs died in April. Its shares have plunged 79 percent in the last year to a record low as its funding costs have jumped and its earnings have fallen amid the credit crunch and tough UK housing market.

It has long been regarded as vulnerable to a takeover, with France’s Credit Agricole , Spain’s Santander and its bigger rivals such as Lloyds TSB all rumoured to have cast an eye in recent years. Its market value has dipped to just under 1 billion pounds.

By 9:25 a.m. A&L shares were up 7.8 percent at 231.5 pence, which analysts attributed to the appointment of an experienced banker and a rebound across the European bank sector as well as the potential for M&A.

Gillespie, 57, became chairman of Ulster, a subsidiary of Royal Bank of Scotland , in 2001. The native of Northern Ireland spent 10 years at Citigroup , specialising in debt capital markets, before moving to Goldman, where he established and was co-head of the European financial institutions group.

He will take over as chairman on September 8, when acting chairman Roy Brown will revert to deputy chairman.

Gillespie said of A&L: "With its distinctive brand and customer franchise and broadly diversified retail and commercial banking businesses, it is well positioned to face the challenging times in the banking industry."

A&L’s profits are expected to drop to 195 million pounds this year, less than half last year’s 399 million, based on a Reuters Estimates average of 15 forecasts. Higher funding costs and losses on risky assets will cut earnings, while revenue will be held back by reducing mortgage lending.

(Reporting by Steve Slater; Editing by David Holmes)

 

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