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Lloyds Bank chief Eric Daniels to stand down

By Siobhan Kennedy

Updated on 20 September 2010

Lloyds Bank chief executive Eric Daniels announces he will retire in a year's time, a move that business correspondent Siobhan Kennedy says will be welcomed by some of the bank's shareholders.

Lloyds Bank announces the resignation of its chief executive Eric Daniels (Getty)

So another one bites the dust. This time, it is the chief executive of Lloyds Bank, Eric Daniels who has announced that he is to step down.

Mr Daniels is the last of the big credit-crunch bosses to exit the stage – following Sir Fred Goodwin and Sir Tom McKillop at RBS.

And not a moment too soon according to some Lloyds shareholders who are still furious about the acquisition of HBOS, the stricken mortgage lender, that transformed Lloyds from one of Britain's most conservative banks into an institution on the brink of collapse and needing to be rescued by the taxpayer.

Mr Daniels follows Lloyds chairman, Sir Victor Blank, who left with his tail between his legs a year ago, to be replaced by Sir Win Bischoff, who had formerly been the top man at Citigroup in the US.

It was Victor Blank (derided as Victor Blank-cheque by some shareholders) who famously negotiated the acquisition of HBOS over a cocktail with Gordon Brown during a garden party at the height of the financial crisis.

Once the dust settled and the losses became clear, Mr Blank did not survive at Lloyds to tell the tale. So is Mr Daniels the next to fall on his sword?

Certainly, Mr Bischoff wanted his chief executive to go earlier this year, but Mr Daniels managed to cling on and was there, just a few weeks ago, to mark the Lloyds's return to profit.

At the time, he proudly declared he had no intention of leaving and wanted to stay at the helm of Lloyds until the integration of HBOS was fully complete.

One source told me that meant Mr Daniels would be there for two to three years more. Yet today, the chief executive told Channel 4 News he had never set any expectations as to his departure date.

"I've never set a date or a timeframe," Mr Daniels said. He said the decision to leave was his own (the media hyped up the row with Mr Bischoff apparently.)

The integration of HBOS is more than half way through and is, he assured, "letter perfect".

"We're going to do better and better, so I wanted to give the board ample time to find a successor, I wanted it to be an orderly succession and a clean handover".

But what about seeing the integration through, as he had said only a couple of weeks ago at Lloyds's half year results?

"This time next year (i.e. when he leaves) we won't be completely done, but we'll be substantially done", he said.

It is interesting, timing wise, that Mr Daniels has announced his intention to step down the very week the Banking Commission – appointed by George Osborne – is due to set out the topics it will consider as part of its year-long probe into competition in the industry.

If Mr Daniels leaves a year from now, he will do so at the exactly the same time the commission is due to give its recommendations to the chancellor.

The man in charge of the commission, Sir John Vickers, was chairman of the Office of Fair Trading at the time of the Lloyds/HBOS merger.

He believed it should have been sent to the Competition Commission for an enquiry. It was not, on the grounds of financial stability and the need to calm markets which were tipping over the edge.

The question Mr Daniels will be asking himself is whether or not Mr Vickers still believes the same thing now. And if he does, what might Lloyds look like a year from now?

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