Britannia director ousted after board clash over strategy

Britannia Building Society, the UK's second-largest mutual lender, yesterday ousted its operations director after a boardroom bust-up over the company's future strategy.

John Suffolk, who has been at the society since 1998, yesterday left "at the request of the board", having disagreed with the direction the company was taking under the leadership of its new chief executive.

The society appointed Neville Richardson to run the business in January last year, and he is in the process of implementing a shake-up of how the society is run.

"The chief executive was looking for a unanimous view on where the strategy was going," a spokesman for Britannia yesterday said, but he added that the building society was still entirely committed to maintaining its mutual status.

The board met on Tuesday and "very quickly" made the decision that Mr Suffolk's position at the company was no longer tenable. He lives in north Staffordshire, near Leek, where the building society is based.

Negotiations over a pay-off package are now under way, but a spokesman for the company yesterday said it was unlikely that Mr Suffolk would receive any severance pay.

He earned £185,000 last year, including pension contribution and benefits. The position is being filled on a temporary basis by someone within the business until a permanent replacement is found.

Mr Suffolk, 45, joined the board in 2001 and ran Britannia's mortgage and savings business. The society ranks behind Nationwide in size and has 2.8 million members, 1.8 million of whom hold savings accounts and about 400,000 are mortgage customers.

The society did have a link with the beleaguered Britannic Group to sell its life insurance products through Britannia's 170 branches, but financial difficulties at Britannic meant it has withdrawn its insurance arm from new business.

The building society last week signed a deal with the UK's largest friendly society, Liverpool Victoria, to offer life insurance and protection products, in return for selling Britannia mortgages through Liverpool Victoria outlets.

Britannia's operating profits for 2002 were steady on the year before at £66.7m after it lowered its mortgage rates.