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Daily Insurance Industry News
Monday 24th of September 2018
January 28, 2009

L&G made demands for resignation of RBS chiefs

by Gill Montia

Story link: L&G made demands for resignation of RBS chiefs

L&G made demands for resignation of RBS chiefs

The chief executive of Legal & General Investment Management (LGIM) has revealed that his company had demanded the resignations of Royal Bank of Scotland (RBS) chiefs as long ago as May of last year.

Appearing before a Treasury Select Committee yesterday, Peter Chambers reported that LGIM had called for the bank’s chairman, Sir Tom McKillop, and its chief executive, Sir Fred Goodwin, to be removed.

The demand came during meetings with members of RBS’s board shortly after the bank had announced its initial £12 billion rights issue, in April.

As a major investor in RBS, LGIM had been led to understand that the bank had no need to raise capital and once the rights issues were announced suggested that Sir Tom and Sir Fred’s positions were untenable.

According to a report in The Times, Mr Chambers was responding MPs’ criticisms of institutional shareholders, which could have been more influential with the boards of the UK’s beleaguered banking sector in the months before the banking crisis erupted.

Also appearing before the committee, Peter Montagnon, chief executive of the Association of British Insurers (ABI) told MPs that ABI members had raised questions with the banks but had not been as effective as they might have been in averting the crisis.

 

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