"We have a very clear strategy for changing the Woolwich," he said. "It is helped by our size because we can be fleet of foot. But equally we do appreciate that if you have a bigger customer base and more scale there is a lot more you can do."
He added: "We are not against size. What we would not do is change size and strategy if it meant being part of a group that would hold us back. However, if there was an institution that shared the same view and and is going in the same direction, we would consider it."
Woolwich, which spurned merger approaches from Alliance & Leicester last year, had serious merger discussions with Royal Bank of Scotland before it came to the stock market in 1997. More recently, it has been talking with the Bank of Scotland. The banks are believed to have been very close to a deal some nine months ago until talks foundered over the share-out of top jobs.
Both banks have been using their low cost base allied to a strategy of linking up with supermarkets to challenge the English clearing banks.
Standard Life, the mutual which has made dramatic inroads into the mortgage and savings market, could also be a possibility. It has around pounds 78bn of assets under management, suggesting it could be valued at pounds 12bn in stock market terms.
Investment, page 19