Casey hits out at 'silly' LSE members

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The Independent Online

Gavin Casey unceremoniously resigned as chief executive of the London Stock Exchange yesterday afternoon, barely 24 hours after being formally confirmed in his post by the narrowest of margins.

Gavin Casey unceremoniously resigned as chief executive of the London Stock Exchange yesterday afternoon, barely 24 hours after being formally confirmed in his post by the narrowest of margins.

His responsibilities will be assumed by Don Cruickshank, the chairman, while the search begins to find a replacement.

Commenting on his departure, Mr Casey said: "I expected to be re-elected and I was. If it had been without a big protest vote I would have been happy to go on. But in the circumstances I thought it proper that I should stand down straight away rather than hang on for a while. It is sad to see people undermining their own business. It is so silly."

Potential candidates who have already emerged for the job include Hugh Freedberg, the chief executive of Liffe, and Ed Warner, chief executive of Old Mutual Securities. Mr Warner is being touted by Brian Winterflood, the de facto leader of the retail broker faction on the Exchange. The name of Phillip Thorpe, managing director of the Financial Services Authority and a former chief executive of the Hong Kong Futures Exchange has also been touted.

Mr Casey's position had become untenable in the wake of the display of anger against him at the Stock Exchange's annual general meeting on Thursday, at which shareholders had voted for his dismissal by a show of hands.

In his resignation letter, which was tendered to Mr Cruickshank after a meeting yesterday morning, Mr Casey described the Stock Exchange as a "fine business" with which he was "proud to be associated".

However, friends said that he is bitter about being made a scapegoat by Mr Cruickshank and others for failures that went wider than one individual.

One associate said that Mr Casey had already effectively been fired by Mr Cruickshank in May when he was told, apparently without warning, that his job was going to Werner Seifert, the Deutsche Börse chief executive, and that there would be no room for him in the iX merger deal.

Mr Casey stands to get his entitlement of one-year's salary plus bonuses, worth £600,000, but will miss out on around £6m of options. The original executive options scheme put in place when the Stock Exchange demutualised in March was suspended when the iX deal with Frankfurt was signed in May.

Although Angela Knight, chief executive of Apcims, the retail brokers lobby, last night called for stability in the wake of Mr Casey's departure. Other influential stockbrokers said that more heads should roll.

Charles Peel of Peel Hunt, the stockbroker, said: "I am very sad. It is not very fair. Blame the senior clerk. I don't think this is the end. A lot of us think there have to be further resignations. I don't think you should have advisers on the board. Unless you get further resignations there could be a backlash. It could all blow up again next week."

Brian Winterflood was more restrained. "The others are on probation. If you ask me what I am feeling it is a mixture of sadness and relief. He has gone and now we need to find a replacement."

However, there is deep unhappiness among retail brokers about the presence on the LSE board not just of Michael Marks, the head of Merrill Lynch Europe, but of Simon Robertson of Goldman Sachs. Goldman Sachs is working flat out with Deutsche Börse, the German exchange, in an attempt to put together a £1bn consortium bid with the Italian and Spanish exchanges for the LSE. Neither would return phone calls yesterday.

Angela Knight added that the board of the LSE should be injected with new blood. She suggested that Pen Kent, the former Bank of England director credited with having sorted out Crest, the settlement system, when the project was taken over by the Bank after the London Stock Exchange proved unable to manage its computerisation successfully.

She also called for Brian Williamson, chairman of Liffe, to come on the board in a non-executive capacity. Mr Williamson has ruled out a merger between Liffe and the London Stock Exchange.