UK Financial Investments Limited was set up to manage all the equity positions UK govt has taken in the various UK banks. It is fully owned by the UK govt.
Y’day, a press release (see Treasury press release as well) from UK said that both Chairman and CEO of the firm are being changed. FT reported :
Alistair Darling stunned top City bankers on Tuesday by announcing a new team to run the taxpayer’s stake in the banking industry, raising fears of a “massive hole” in the management of a portfolio that could eventually be sold for more than £100bn.
The chancellor said John Kingman, chief executive of UK Financial Investments, was stepping down, relinquishing his role as chief shareholder in RBS and Lloyds Banking Group for a move to the private sector. Mr Darling announced simultaneously that Sir David Cooksey, the businessman and venture capitalist, would replace Glen Moreno as chairman of UKFI. One of his first jobs will be to find a City high flyer to replace Mr Kingman.
Telegraph said Klingman wanted to join pvt sector 2 years back but decied to stick on and help the govt manage the crisis. He also is likely to get a much higher salary going forward (but obvious). Another FT article has more details:
John Kingman jokingly called it his “little start-up”. From a room in the corner of the Treasury, UK Financial Investments manages bank shares equivalent to £3,000 for every household in Britain, with a remit to sell that stake at a profit. Yet less than nine months after UKFI was set up, Mr Kingman, the high-flying civil servant who became its first chief executive, and Glen Moreno, acting chairman, are leaving.
“UKFI is one of Britain’s most powerful bodies and these changes at the top come at a very sensitive time,” said Vince Cable, Liberal Democrat Treasury spokesman.
Treasury insiders say they knew two years ago that Mr Kingman wanted to move to the private sector, even if the news came as a shock to some in the City. One senior banker said on Tuesday he was “gobsmacked” to hear the news. Mr Kingman’s departure leaves the biggest hole, since he was the Treasury permanent secretary who masterminded Northern Rock’s rescue and was intimately involved in the deal to save RBS and Lloyds.
His tough negotiating style was described by Sir Fred Goodwin, former RBS chief executive, as like a “drive-by shooting”. His intellectual manner was seen by some MPs on the Treasury committee as arrogance. Mr Kingman’s friends believe he stayed in the civil service because it was more “fun” than working in the private sector; they insisted he was not motivated by money. But his priorities may have changed: his return to the private sector is likely to be lucrative. City figures speculate he could move to an investment bank, although he says he does not have a job lined up.
I hope there is no irregularity in the finances of UKFI. Otherwise, UK Govt has had it. Moreover, I don’t know why would you leave such an important office to join pvt sector at this point of time ? It is bound to get criticism and people would look at it from all possible angles.
Another issue is if Klingman joins some finance firm, the problem of fluid movement froma top job in finance to a top govt job and vice-versa continues. It was not seen as a problem till now and was considered healthy as both pvt and public sector gained. This crisis has changed the belief and is seen as a major impediment to reforming finance and bringing it under some control. Tough tough times for govt officials. They should be very careful of their moves.