Royal Bank of Scotland’s chief executive, Ross McEwan, has resigned after five and a half years in the job, saying now is the “right time” to leave.
The 61-year-old New Zealander has a 12-month notice period and will remain at the helm of the bank, which is still 62% owned by the UK government, until a successor has been found and an “orderly handover has taken place”.
The bank’s chair, Howard Davies, said McEwan’s strategy to refocus RBS on the UK and Ireland had “helped to deliver one of the biggest UK corporate turnarounds in history”.
He said: “Ross has worked tirelessly to make the bank stronger and safer and played the central role in delivering a return to profitability and dividend payments to shareholders. The board and I are grateful for the huge contribution Ross has made in one of the toughest jobs in banking.”
Alison Rose, who runs RBS’s commercial and private banking division, is the internal favourite to take over from McEwan. Davies said the bank would conduct a full internal and external search.
Rose has worked for RBS for more than 20 years and was also promoted to deputy CEO of NatWest Holdings, the bank’s ringfenced holding company, which houses RBS’s retail and corporate banking, in December. In this role, she has been deputising for McEwan and advising on strategic projects.
RBS recently posted annual profits of £1.6bn, up from £752m a year earlier. This marked the second consecutive year of profit for the bank since its £45bn state bailout in 2008. The Treasury plans to sell the entire public stake by 2023-2024. In October RBS paid paid its first dividend since the bailout.
McEwan said: “After over five and a half very rewarding years, and with the bank in a much stronger financial position, it is time for me to step down as CEO.
“It is never easy to leave somewhere like RBS. However, with much of the restructuring done and the bank on a strong and profitable footing, I have delivered the strategy that I set out in 2013 and now feels like the right time for me to step aside and for a new CEO to lead the bank.”
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RBS is holding its annual meeting in Edinburgh on Thursday afternoon.
Gary Greenwood, an analyst at Shore Capital, said: “While significant further work remains to improve profitability and returns, we believe that RBS is now in much better shape than when Mr McEwan took over the role.”
John Cronin at Goodbody said McEwan had done a “stellar job bringing RBS back from the brink and we are sorry to see him go”.
A number of internal candidates had been groomed to take over, he said, and shareholders would be “highly supportive” if Rose, the frontrunner, was appointed.