View from City Road: An abrupt departure

TSB is finding it hard to shake off its reputation for internal brawling. Sir Nicholas Goodison, the chairman, insists that he has been quietly talking to Don McCrickard about his departure for six to eight months, that the board has known about it for some time and that yesterday's events put the formal seal of approval on a change that has been in the works for months.

There is an argument for seeing his removal as mildly positive for the share price, despite the fact that an outrageous price is once again being paid to reward failure rather than success.

Mr McCrickard was running a group with three main constituents. Of these, the banking and insurance subsidiary was by far the largest and most important to future profits, and it had a chief executive of its own, Peter Ellwood, who now steps neatly into the group chief executive's shoes. The other legs of the group are the ill-fated Hill Samuel merchant bank, which is being rehabilitated by its own chief executive, and a rag-bag of odds and ends such as car leasing. But if TSB had not lost so much money, surely room would have been found for both Mr McCrickard and Mr Ellwood?

Despite all the denials that Mr McCrickard has been ousted because of TSB's lousy performance and the losses at Hill Samuel, the abruptness of the departure suggests the contrary. An open row or a boardroom putsch do not fit with Sir Nicholas's urbane style, but the belated discovery that Mr McCrickard has worked himself out of a job is rather convenient at a time when the group's reputation has still to recover significantly from its record lows. If that recovery does not come smartly, it will be Sir Nicholas's turn next.

(Photograph omitted)