Running to the rescue

26 October 2007 By Edward Hadas Follow @edwardhadas

Who would want to be associated with a lender on government life support? UK heavyweights, it seems. Former RBS boss George Mathewson has signed up with Virgin, and JC Flowers has countered with wellconnected Paul Myners. Why join? There could be profit and political kudos.

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JC Flowers confirmed on Friday that it was in talks to buy Northern Rock, the UK bank. JC Flowers also announced the members of the potential management team.
        — Paul Myners would be chairman. Myners is chairman of Land Securities and of Guardian Media Group, as well as of the board of trustees of the Tate museums. He is a member of the Court of the Bank of England, but is expected to stand down from that position for as long as he is involved with Northern Rock.
        — Richard Pym would initially be chief executive. Pym retired as chief executive of Alliance & Leicester, a UK bank, in July.
        — Hugh ScottBarrett, the potential finance director, resigned from his position as chief financial officer of ABN Amro, the Dutch bank, in August.

Three advisors were also named: Bob Bennet, retired finance director of Northern Rock; Peter Birch, formerly chief executive of Abbey National, a UK bank, and Sir Martin Jacomb, formerly chairman of Prudential, the UK insurer.

Virgin Group announced the members of a rival consortium interested in Northern Rock on October 12.

The investors include: Virgin Group itself, the investment vehicle for Sir Richard Branson's Virgin brand; AIG Financial Products, part of the international AIG insurance group; WL Ross & Co., the investment vehicle of Wilbur Ross, a successful investor in distressed assets.

In addition, Sir George Mathewson will be a special advisor to the Virgin consortium, Sir George retired as Chairman of Royal Bank of Scotland in 2006.

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