Friday 2 December 2016

Hodgkinson is Lenihan's choice for AIB top job

Published 25/10/2010 | 05:00

Sources yesterday pointed out that Mr Hodgkinson would be ideally placed to 'cherry pick' other AIB executives from across the globe, since the British banker has spent long periods working abroad. Photo: Bloomberg News
Sources yesterday pointed out that Mr Hodgkinson would be ideally placed to 'cherry pick' other AIB executives from across the globe, since the British banker has spent long periods working abroad. Photo: Bloomberg News

BRIAN Lenihan's first choice for the top job at AIB is a straight-talking British banker best known for insisting that Bank of England interest-rate cuts wouldn't necessarily be passed on to mortgage holders.

  • Go To

The comments, made by HSBC chief operating officer David Hodgkinson in November 2008, provoked outrage from then UK prime minister Gordon Brown and consumers alike.

Mr Lenihan has now decided Mr Hodgkinson is his preferred choice for the executive chairman's position at AIB, sources confirmed this weekend, echoing reports in a Sunday paper.

Crucially, the Irish Independent understands that Mr Hodgkinson has yet to sign on the dotted line with the National Treasury Management Agency (Ntma), which is co-ordinating the hunt for AIB's new top brass.

Mr Hodgkinson must also clear the Financial Regulator's 'fitness and probity' test, a requirement for all senior executives appointed to banks.

Shake-up

News of the imminent appointment comes after Dan O'Connor stepped down from the executive chairman's role in recent weeks, following the effective nationalisation of AIB.

The bank's managing director, Colm Doherty, has also agreed to step down, and the Department of Finance has hinted at a wider shake-up of AIB's management.

Sources yesterday pointed out that Mr Hodgkinson would be ideally placed to "cherry pick" other AIB executives from across the globe, since the British banker has spent long periods working abroad.

A HSBC staffer since 1969, Mr Hodgkinson spent a lengthy term overseas where he rose to managing director of The Saudi British Bank from 1993 to 2003 and chief executive of HSBC Middle East from 2003 to 2006.

The career banker, who retired from HSBC at the end of 2008, is best known for his frank comments in November 2008 when he told journalists his bank might not pass a cut in Bank of England interest rates on to HSBC's 300,000 mortgage holders.

"Clearly, if interest rates are down significantly, the rates for borrowing will go down, but I am not going to say it is absolutely linear, because it depends on the particular (situation)," he said.

He added that while HSBC would do its "very best" to bring rates down, he could not "give a categorical commitment that they will come down" since there was a "stickiness" in rates.

The comments followed a keynote speech from Mr Brown who called on banks to ease lending conditions to struggling families and businesses.

A spokesman for the Department of Finance said he had "no comment" to make on reports of Mr Hodgkinson's imminent appointment, as did a spokeswoman for AIB and a spokesman for the Ntma.

As well as drawing on his overseas experiences for AIB recruitment, Mr Hodgkinson also credits his time in Asia with teaching him the lessons of the Hong Kong and Singapore property crashes and the 1987 markets crash.

"It was scary but very educational," he said in a trade publication in 2008, as he told of the experience of bust to recovery.

Irish Independent

Read More

Promoted articles

Editors Choice

Also in Business