Saunders set to leave WestLB with £1m

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The Independent Online

Robin Saunders, the high-profile head of WestLB's principal finance unit, is set to quit the German bank as early as today.

Ms Saunders was in final negotiations over her exit package from WestLB last night and a formal announcement is imminent. Although the final details are still being hammered out by lawyers, she is thought to have reached an agreement to leave with accrued pay and bonuses worth about £1m.

WestLB decided to dispose of the principal finance division, which specialised in taking large stakes in often cash-strapped companies, after the state-owned bank was forced to warn of ¤1.9bn of provisions for non-performing loans in May.

The provisions included a ¤430m write-down on the principal finance unit's investment in the television rental company BoxClever, which prompted an investigation by the German banking regulator BaFin and led to the departure of WestLB's chief executive Jürgen Sengera.

Although Ms Saunders was not criticised by the regulator, the controversy has marred her career at WestLB.

The decision to wind down the unit prompted Ms Saunders to tell friends and close colleagues that she was keen to form a consortium of investors to bid for the £150m of equity and £2bn of debt in the portfolio.

However, instead of selling the business to Ms Saunders, WestLB has decided to auction off separately most of the portfolio of equity and debt stakes it holds in companies. Pubmaster was sold to Punch Taverns for £1.2bn. The cinema chain Odeon is also on the block, with Morgan Stanley and Tricorn Partners appointed this week to consider offers. BoxClever may also be sold, as may the whisky maker Kyndal.

Sources close to WestLB said the bank's management had held cordial talks with its former rising star about her imminent departure.

Ms Saunders is one of the wealthiest women in the City, having earned hefty bonuses from her deals at WestLB, including from stakes she has bought personally in companies the bank has invested in.

She is thought to have collected nearly £5m from investments in Pubmaster and Bhs. Some £3.75m of that came from her personal stake in Pubmaster. She also received in the region of £1m in dividends from her stake in Philip Green's Bhs chain.

Mr Green and other very rich businessmen such as property tycoon Robert Tchenguiz, and Formula One boss Bernie Ecclestone, were some of the individuals Ms Saunders is said to have approached about stumping up the money to buy the principal finance business.

The banker is believed to have managed to raise the necessary capital for the business. But WestLB decided it did not want to sell the entire business in one chunk.