Angela Knight, chief executive of lobby group the British Bankers’ Association (BBA), will step down from her role after five years defending the industry over pay, taxpayer bailouts and the mis-selling of products to millions of customers.
It did not name her successor, who will immediately face the task of defending the BBA itself against an international probe into the alleged manipulation of the London Interbank Offered Rate (Libor) benchmark by contributing banks.
The BBA is to review how Libor is set but said it has no plans to cede oversight. The probes span the United States, Europe and Asia as regulators assess whether banks and interdealer brokers attempted to rig the price.
“Getting a group of all the relevant parties in a manner to evolve Libor is not the easiest thing to have to do but it needs to be done,” Knight told Reuters.
Knight, 61, will stay on while the search for a successor continues. A list of potential suitors has been drawn up, one person familiar with the matter said.
It could include Simon Lewis, CEO of European investment banking lobby group AFME who was a senior aide to former UK prime ministers Tony Blair and Gordon Brown, and a director of corporate affairs at Vodafone and NatWest bank.
Knight took the BBA’s reins in April 2007, becoming the first woman to head the body, which was set up in 1919 and speaks for more than 200 UK and international banks, such as HSBC, Barclays and J.P. Morgan. “It’s hard to speak with one voice for the whole industry. She’s also been first out the trenches on a lot of issues, so you need a thick skin,” a person at a BBA member bank said.
Knight joined just as the U.S. subprime mortgage crisis was about to trigger a chain reaction that culminated with the demise of U.S. bank Lehman Brothers in Sept. 2008, causing a near-meltdown of the financial system.
She had to speak up for banks as Northern Rock, HBOS and Royal Bank of Scotland neared collapse and needed taxpayers to pump in more than 65 billion pounds.
“It was a time when you really did not quite know what was happening next. Share prices were falling, people were being called into Downing Steet and the Treasury, but the hairiest moment was when Lehman fell and all bets were off,” Knight said.
She also defended the industry in the face of increased regulation from UK and global financial watchdogs, the mis-selling of millions of insurance product contracts, and frequent accusations of excessive pay.
The former politician was often outspoken. She said on arrival she would be more vocal than her predecessor, Ian Mullen, slamming a tax on bonuses as “populist, political and penal”.
Some banks asked her to rein in some of her comments a year ago, and take a lower profile on certain issues, one industry source said.
Knight is from Sheffield, a city renowned for its steel industry, and set up a precision engineering business before becoming a member of parliament for the Conservative party. She was economic secretary to the Treasury between 1995 and 1997.
She spent nine years heading private investor lobby group APCIMS before joining the BBA and is expected to seek another executive role. She is a director at investment firm Brewin Dolphin and broker Tullett Prebon.
“I have another job in me and I am going to look for it,” Knight said.