The board of directors of the Royal Bank of Scotland Group (RBS) has announced that Stephen Hester will be stepping down as the group’s chief executive later in 2013.
The board believes that an orderly succession process will give a new CEO time to prepare the privatisation process for RBS and to lead the bank in the years that follow. Hester was unable to make that open-ended commitment following five years in the job already, according to RBS.
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The search for a successor will commence immediately, led by the chairman of RBS, Philip Hampton, on behalf of the board, and will consider both internal and external candidates. Hester will continue to lead the business until December 2013 to ensure a smooth handover, unless a successor is in post before then.
Hester was appointed to the board in October 2008 and to the position of group chief executive in November 2008. Since then he has led the rescue of RBS, its recovery plan and one of the largest and most complex company restructurings ever seen.
Hester said: "We are now in a position where the Government can begin to prepare for privatising RBS. While leading that process would be the end of an incredible chapter for me, ideally for the company it should be led by someone at the beginning of their journey."
In line with Hester’s contractual arrangements, he will receive payment in lieu of notice of GBP1.6 million representing 12 months pay and benefits. He will not receive a bonus for 2013, which is also in line with contract terms.
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