Burt survives US fiasco

Bank of Scotland chief weathers storm over evangelist partnership

BANK OF SCOTLAND chief executive Peter Burt will survive calls for his resignation on Tuesday at the bank's annual general meeting in Edinburgh, according to bank shareholders.

But Mr Burt's plan to start a telephone bank in the US with a new partner - replacing the controversial American television evangelist Dr Pat Robertson - faces regulatory delays, according to sources close to the US Comptroller of the Currency.

"I don't think Peter should go simply because he made a mistake getting involved with Robertson," said a fund manager with a stake in the bank. "The issue is whether that mistake indicates something fundamentally wrong with management, and there's no evidence this is so."

Guy Hooker, director of Edinburgh's Ethical Investment Cooperative, last week called for Mr Burt to step down. On Wednesday, the Bank of Scotland chief executive apologised for the joint venture with Dr Robertson, aborted after the preacher called Scotland a "dark land" where homosexuals were "strong". "Obviously, we got it wrong," Mr Burt said, "and I'm sorry about that."

But his supporters endorsed the argument he put forward in a Financial Times interview last week: "If you execute everybody who tries to do something and gets it wrong, pretty soon you'll have nobody who tries to do anything."

The Bank of Scotland will now look for a new partner for its US telephone bank. Candidates include US retailers and internet portal companies, according to US bankers.

But the Bank of Scotland's effort to break into the US market faces new regulatory delays. The bank must get a licence from the Office of the Comptroller before it can begin operating in the US. To do this it will probably have to withdraw its current application and start again.

"The people at the Comptroller's office I talked to had sympathy with the Bank of Scotland," said Matthew Lee, executive director of Inner City Press/Community on the Move, an organisation opposed to a Robertson-backed bank on the grounds that Dr Robertson would not want minorities as customers. "But they said the bank's current application is in limbo."