Paul Tucker is standing down as Deputy Governor of the Bank of England, it was announced today.
Tucker was said to have narrowly lost out in the race to be the next Governor of the bank to Canadian Mark Carney who takes up his post at the start of next month.
News that Tucker is leaving before his term ends next year immediately led to speculation that he will enter the world of commercial banking with Royal Bank of Scotland and Lloyds Banking Group looking for a new chief executive and new chairman respectively.
Tucker said that he plans to head for the United States where he will take up a position in academia.
However, bankers pointed out that both jobs could be available for some time with Lloyds chairman Sir Win Bischoff not due to retire until May 2014 and RBS chief executive Stephen Hester prepared to stay on until the end of this year.
The Bank said no date had been set for Tucker’s departure and that he would remain in post while Carney settles into his new job and would probably leave in the autumn.
Outgoing Governor Sir Mervyn King said: “Paul’s contribution to the Bank, to monetary policy, and more generally to public policy, both in the UK and in the world as a whole has been enormous.”
Tucker said: “It has been an extraordinary honour to serve at the Bank of England over the past 30 years. I am very proud that, through the Bank and the wider central banking community, I have been able to make a contribution to monetary and financial stability. I will continue to do so in the coming months.”
Many City people put Tucker’s failure to get the top job down to his correspondence with Barclays chief executive Bob Diamond who was forced to resign over the Libor-rigging scandal.
Tucker paid tribute to Diamond as “an absolute brick” during the financial crisis in correspondence in December 2008. He was responding to a message from Diamond in which the Barclays boss, then head of the investment bank, congratulated Tucker on his appointment as deputy governor.
Diamond wrote: “Paul, congratulations. Well done, man. I am really, really proud of you. Talk soon.” Tucker replied: “That’s so much Bob. You’ve been an absolute brick through this.”
Andrew Tyrie, chairman of the Treasury Select Committe, told Tucker “It doesn’t look good, I have to tell you,” referring to the exchange with Diamond.