Lloyds names HSBC's Charlie Nunn as chief executive
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[November 30, 2020] By
Carolyn Cohn and Iain Withers
LONDON (Reuters) - Britain's biggest
domestic lender Lloyds Banking Group has named Charlie Nunn, currently
head of wealth and personal banking at rival HSBC, as its next chief
executive.
Nunn will replace long-standing Lloyds boss Antonio Horta-Osorio who
said in July he would step down next year after a decade at the helm.
Nunn will be charged with steering Lloyds, seen as a bellwether for
Britain's economy, through the fallout from the COVID-19 pandemic and an
era of rock-bottom central bank interest rates.
Despite taking hefty provisions against potential loan losses this year,
analysts say Lloyds, like its rivals, faces further pain as government
support for jobs and businesses is withdrawn next year.
Shares in Lloyds, which said earlier this month it is cutting more than
1,000 jobs, are down 40% this year, although they have rallied a third
since the start of November following news of breakthroughs in the race
to find a vaccine against COVID-19.
Lloyds shares gained 1% on Monday.
Analysts welcomed the appointment but said Nunn may not take up his new
job for almost a year, after Lloyds said he was subject to a six-month
notice period and a further six months of restrictions.
"It does mean that Lloyds will be without a CEO as they start a critical
2021 where a fundamental shift in strategy is clearly necessary to
address the markedly lower revenue given the unexpectedly low interest
rate environment," analysts at KBW said in a note.
Lloyds said CFO William Chalmers would become acting CEO if Horta-Osorio
left the bank before Nunn joins.
Nunn, a former McKinsey and Accenture consultant, who joined HSBC in
2011, was appointed to his current role earlier this year following a
management reshuffle by CEO Noel Quinn.
Nunn, 49, grew up near Southampton in Southern England and is married
with four children.
At HSBC, colleagues said he was known for his structured approach and
for a focus on upgrading digital capabilities. He emerged in February as
one of the winners of HSBC's latest executive reshuffle, taking over the
bank's newly combined wealth and personal banking divisions.
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Charlie Nunn, chief executive officer of HSBC Wealth and Personal
Banking division poses for a photograph in London, Britain February
19, 2020. REUTERS/Simon Dawson
"It makes sense to bring in someone with a fresh perspective, he can bring a lot
more insight into what can be done differently than someone internal," one
Lloyds institutional investor told Reuters, who declined to be named.
HSBC said in a separate memo that Nuno Matos, currently head of its non-ringfenced
British arm, is to replace Nunn.
LOWER PAY
At Lloyds, Nunn will receive a lower pay package than his predecessor. Lloyds
said he had agreed to lower bonuses than the policy allowed, reducing his
maximum potential pay by 20%.
This would limit his pay to around 5 million pounds, compared with the 6.3
million pound limit calculated by investor advisory group ISS for Horta-Osorio.
Incoming chairman Robin Budenberg has also asked for his pay package to be cut
by 20%, Lloyds said.
Lloyds' pay policy for senior executives has faced long-running criticism. One
third of balloted shareholders voted against the bank's pay policy at its
investor meeting in May.
Nunn will receive a basic annual salary of 1.1 million pounds ($1.50 million)
and a fixed share award of 1.1 million pounds, in addition to flexible benefit
funding of 4% of basic salary, Lloyds said in a statement.
His pension has been set at 15% of his salary.
($1 = 0.7496 pounds)
(Reporting by Carolyn Cohn and Iain Withers, Additional reporting by Lawrence
White; Editing by Rachel Armstrong/Louise Heavens/Jane Merriman)
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