Tesco board veteran Higginson to step down

Andrew Higginson, Tesco's chief executive of retailing services, shocked the grocery world with his decision yesterday to step down in 2012 after 15 years at the group.

Analysts at Shore Capital said the retirement of the "highly regarded" Mr Higginson next September would be a "loss" to Tesco, following the exit of its former chief executive Sir Terry Leahy in March.

Both played pivotal roles in turning Tesco into the world's third largest retailer by sales, with operations in 14 countries. As head of the group's retailing services division, Mr Higginson oversaw its online operation for grocery and non-food, banking and Dunnhumby, the data insight unit behind Tesco Clubcard.

Arguably the biggest achievement of Mr Higginson, who is chairman of Tesco Bank, was leading its move into mainstream banking via its acquisition of Royal Bank of Scotland's 50 per cent stake in Tesco Personal Finance for £950m in 2008.

Sources said Mr Higginson, who was finance and strategy director after joining Tesco from Burton in 1997 until 2008 , would have been an "outside contender" for the role of chief executive vacated by Sir Terry. But Philip Clarke, the group's former international chief, got the job.

Mr Higginson said: "Next year, I will be 55 and will have completed 15 years on the board of this great company. We will have completed the creation of the Bank as a standalone entity, and that seems an appropriate moment to hand over, and move on to the next phase of my career." He has received total pay, including salary and bonuses, of more than £5m over the past two years.

Tesco Bank hopes to launch mortgages later this year and current accounts in 2012.