Terry Murden: FirstGroup all aflutter as Finch flies off and Carr draws up

Published on Saturday 2 May 2009 13:32

The jostling for position at bus and train company FirstGroup sparked into life on Friday when it lost one potential chief executive and gained another.

Dean Finch, chief operating officer, was seen as heir apparent to Sir Moir Lockhead, but is leaving the company to take the top job at Tube Lines, the London Underground contractor.

Lockhead, 64, has said he is in no hurry to retire and will combine Finch's job with his role as chief executive and deputy chairman. That will be easier now that Finch's task of integrating the US acquisition Laidlaw is complete.

But the markets are already whispering about Lockhead's successor and the arrival of Jeff Carr from easyJet as finance director has thrown another candidate in the mix. With Finch off the scene some see Carr as the likely choice, though he may have to battle it out with two internal rivals: Mary Grant and Nicola Shaw. In Friday's merry-go-round Grant was promoted from managing director of ScotRail to managing the group's rail division. Shaw heads the group's buses and is another on the list.

Carr's switch from easyJet comes against an acrimonious fall-out at the airline following criticism of the board by its founder and non-executive director Sir Stelios Haji-Ioannou. He and Carr disagreed on the company's growth plans and Sir Stelios, whose family owns 38% of the shares, refused to sign off the year-end accounts. The company has also hired a new chairman after Sir Colin Chandler resigned. Amid the furore Carr is due to present the half-year results on Wednesday and will be pressured to say when he'll be heading north.

Kane more than able to lead Standard Life

MORE speculation at the top: this time over who will replace Sir Sandy Crombie at Standard Life. One name rapidly rising up the candidate list is Archie Kane, Lloyds' group executive director for insurance.

While short odds are being offered on finance director David Nish getting the job, Kane's stock is definitely rising and it is easy to see why. He turned round Scottish Widows which was beginning to look like an expensive purchase and a drag on Lloyds performance. Now it has emerged the stronger over Clerical Medical in the Lloyds-HBOS merger.

Kane, a good communicator as well as an experienced hand, is untouched by the continuing acrimony at the top of Lloyds and the banking sector in general. With Standard Life re-inventing itself as a broadly based manager of assets, he has the required track record in life and pensions, banking and asset management.

He was tipped in this column to get a senior role in the Lloyds-HBOS merger and it would be astonishing if he didn't get a look-in at Standard Life. One doubt would be his willingness to leave Lloyds where he's been a dedicated servant, but opportunities to lead a FTSE-100 company don't come around too often. Just ask Trevor Matthews who left Lothian Road for Friends Provident when it became clear that Crombie was in no rush to retire.

Matthews is among the contenders for the job, though you'd get long odds on his return. Nick Prettejohn, chief executive of Prudential's UK and European business, appeared to rule himself out in an interview with The Scotsman. Mike Kellard, chief executive of Axa, is another with a bit of a following.

Gerry Grimstone, Standard Life's chairman, says he'll search the world as the company did when it brought in Matthews. But he may just find the right man on his Edinburgh doorstep.

Banks bounce? Keep a check on optimism

THE recent revival in bank shares is a frustration to those weary investors who bailed out earlier this year when they hit rock bottom. At almost any point in the past three months investors would have made money. Royal Bank has doubled since the beginning of February and is up 75% in the past month. Lloyds is up 21% and 54% over the same time frames. Barclays is doing even better: a rise of 163% and 78%.

So are the good times here again? Some are seeing the trend as signalling an end to the bear market, but caution has to be the watchword. RBS will publish a first quarter trading update on Friday and it isn't expected to be pretty.

The surge in shares is largely down to a belief that UK banks will not require more capital. However, on Thursday we'll get the results of the stress tests on the US banks and word is that six of the 19 scrutinised are likely to need more support. It could bring the recent run to a juddering halt.