‘I am not here to close you down’
Feb 22 2008 By Andrew Hebden, The Journal
THE new chairman of Northern Rock last night hailed the resilience of the bank’s thousands of North East employees, saying they displayed the “very best characteristics” of the region.
In his first interview since taking up his new role at the troubled bank on Monday, Ron Sandler told The Journal he had been delighted by the “commitment, loyalty and determination” of the workforce.
He again said it was too early to talk about the scale of any job losses but he stressed that he was increasingly impressed by the workings of the bank as he got to know more about the institution.
And he reiterated that formal nationalisation of the bank – which could come about today – did not mean “running down” the Rock to the point of non- existence.
Mr Sandler said he had been taking the time to speak to as many of the firm’s staff as possible, in the form of small group briefings, meetings of up to 20 employees, and simply chatting to staff in the corridor. Yesterday afternoon, he addressed a total of 300 workers during two sessions at the firm’s Gosforth headquarters.
At Monday’s Press conference, Mr Sandler had insisted that it had been “a good day”, and last night he said the positive start had continued on subsequent days. “They continue to be good days and, in many respects, they get better and better,” he told The Journal.
“I have gone out and about and spent time with the staff here, met people and talked to them about what’s on their minds. I give them some sense of how I see this episode unfolding. It is reassuring to see the people who have been keeping the bank going all this time – their commitment, their loyalty and their determination.
“My message to them is thanks for everything that they have done. I have been explaining to them that public ownership is not about running down this bank to the point that it no longer exists in any form. It is about settling the organisation down, reorganising it and ultimately running it as a viable commercial entity.”
Mr Sandler, who has been delighted by the warm welcome he has received since his arrival on Monday, said he was pleased by the upbeat mood around Northern Rock House considering the uncertainty of recent days.
“The mood appears to be extremely positive,” he said. “All of the best characteristics of this part of the world seem to be coming through in the staff. They are very proud of the institution, they are determined to overcome the challenges ahead and there is a real willingness to succeed.” Reports in the national Press have suggested the scale of job losses could amount to more than 3,000, around half of the current workforce. That is based on projections linked to the rescue plan drawn up by the Rock’s in-house management team whose bid was ultimately rejected along with that of Sir Richard Branson’s Virgin Group in favour of nationalisation.
The in-house bid had been expected to see the Rock’s mortgage book reduced by about a half, although claims that this would necessarily mean a similar scaling-back of staff numbers have been questioned.
Mr Sandler stressed that life as a nationalised institution presented different opportunities and challenges.
“The stand-alone plan was developed against the backdrop of a particular ownership and funding model and that has changed,” he said. “We are looking afresh at these plans in the context of the new world. It will take a little time to revise these plans and ensure they are robust and appropriate.” He refused to be drawn on any timescale for future announcements, saying the business had to be looked at very carefully before any “significant public statements” could be issued. There will, however, be changes in the boardroom once the nationalisation process is concluded, with the chairman confirming that some directors and non-executives will leave, some will stay and new faces will be appointed. But Mr Sandler again stressed that the timescales involved for turning round the business would be “about years and not months”.
