Sir Derek Wanless was an English banker and an adviser to the Labour Party.
Biography
Derek Wanless was born in Newcastle upon Tyne, where he was educated at the Royal Grammar School. From 1967-70, he was an undergraduate at King's College, Cambridge, which he attended on a support grant from Westminster Bank. He was an extraordinarily gifted mathematician and graduated as Senior Wrangler in 1970. On graduation he moved into banking, qualifying as a statistician, and attended the Program for Management Development at Harvard. He was a member of the Institute of Statisticians and a Fellow of the Chartered Institute of Bankers, of which he was President in 1999. He had joined Westminster Bank, a constituent of the present NatWest Bank in 1967, beginning with a Saturday job before becoming NatWest's Director of Personal Banking from 1986-1988. Then becoming the General Manager for UK Branch Business and UK Financial Services before, in 1992, taking on the role of Group Chief Executive until 1999, when he received a reported pay-off of £3,000,000. It was on Friday 8 October 1999, that BBC News reported that Derek Wanless had been ousted from his position as Chief Executive. Wanless was reportedly forced out by the bank's Non-Executive Directors, who replaced him with Sir David Rowland. Wanless had been criticised by City investors for taking the bank into investment banking, and failing to curtail high costs. As executive responsible for NatWest's card business, he led the team which invented Switch, the UK's debit card scheme. He led the NatWest Group immediately prior to its takeover, by the relatively small Royal Bank of Scotland. In 2002 he carried out a review of the future funding of the National Health Service for Gordon Brown, then Chancellor of the Exchequer and in 2007 carried out a further review for the King's Fund. He was a Non-Executive Director of Northern Rock between 2000/2007, where he was Chairman of The Northern Rock's Audit and Risk committees. His position became highly contentious, following the incipient collapse of Northern Rock in September 2007. The Northern Rock's crisis was due to inadequate risk provision, and a 'run on the Bank' was only halted with promises of unlimited UK government support. Sir Derek was heavily criticised regarding his role in the Northern Rock affair by a committee of MPs sitting on the Commons Treasury Select Committee on 16 October 2007. Sir Derek's resignation was accepted by Northern Rock's newly appointed Chairman on 17 November 2007. He died of pancreatic cancer at the age of 64 in 2012.
#31. - The directors of Northern Rock were the principal authors of the difficulties that the company has faced since August 2007. It is right that members of the Board of Northern Rock have been replaced, though haphazardly, since the company became dependent on liquidity support from the Bank of England. The high-risk, reckless business strategy of Northern Rock, with its reliance on short- and medium-term wholesale funding and an absence of sufficient insurance and a failure to arrange standby facility or cover that risk, meant that it was unable to cope with the liquidity pressures placed upon it by the freezing of international capital markets in August 2007. Given that the formulation of that strategy was a fundamental role of the Board of Northern Rock, overseen by some directors who had been there since its demutualisation, the failure of that strategy must also be attributed to the Board. The non-executive members of the Board, and in particular the Chairman of the Board, the Chairman of the Risk Committee and the senior non-executive director, failed in the case of Northern Rock to ensure that it remained liquid as well as solvent, to provide against the risks that it was taking and to act as an effective restraining force on the strategy of the executive members.
