Derek Wanless
Encyclopedia
Sir Derek Wanless is an English
bank
er and adviser to the United Kingdom Government.
He was educated at the Royal Grammar School
in Newcastle
, has an MA in Mathematics from King's College, Cambridge
which he attended on a support grant from Westminster Bank (a constituent of the present NatWest Bank). He is a qualified Statistician and Banker and attended the Program for Management Development at Harvard. He is a member of the Institute of Statisticians
and a Fellow of the Chartered Institute of Bankers, of which he was President in 1999.
In 1967 he joined Westminster Bank,a constituent of the present NatWest Bank, 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 (then) 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 is a commissioner of the Statistics Commission
and 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 MP's 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 is also Chairman of the Northumbrian Water Group and the Financial Services National Training Organisation. He is a Trustee of the National Endowment for Science, Technology and the Arts.
, received a Knighthood in the New Year's Honours List, 2005, and a Doctor of Civil Law, honoris causa from Durham University
on 30 June 2005. He received an Honorary Doctorate in Business Administration (Hon DBA) from Sunderland University in July 2007. A further Honorary Doctorate was awarded by Coventry University
in November 2007, which prompted a Daily Telegraph article questioning the value of such awards
The House of Commons Select Treasury Committee published its report into the Northern Rock affair on 24 January 2008. Wanless's role as Chairman of the Risk Committee, was criticised in the report. The report's conclusion is appended below, and the full report may be found as referenced.
England
England is a country that is part of the United Kingdom. It shares land borders with Scotland to the north and Wales to the west; the Irish Sea is to the north west, the Celtic Sea to the south west, with the North Sea to the east and the English Channel to the south separating it from continental...
bank
Bank
A bank is a financial institution that serves as a financial intermediary. The term "bank" may refer to one of several related types of entities:...
er and adviser to the United Kingdom Government.
He was educated at the Royal Grammar School
Royal Grammar School, Newcastle
Royal Grammar School Newcastle upon Tyne, known locally and often abbreviated as RGS, is a long-established co-educational, independent school in Newcastle upon Tyne, England. It gained its Royal Charter under Queen Elizabeth I...
in Newcastle
Newcastle upon Tyne
Newcastle upon Tyne is a city and metropolitan borough of Tyne and Wear, in North East England. Historically a part of Northumberland, it is situated on the north bank of the River Tyne...
, has an MA in Mathematics from King's College, Cambridge
King's College, Cambridge
King's College is a constituent college of the University of Cambridge, England. The college's full name is "The King's College of our Lady and Saint Nicholas in Cambridge", but it is usually referred to simply as "King's" within the University....
which he attended on a support grant from Westminster Bank (a constituent of the present NatWest Bank). He is a qualified Statistician and Banker and attended the Program for Management Development at Harvard. He is a member of the Institute of Statisticians
Institute of Statisticians
The Institute of Statisticians was a British professional organization founded in 1948 to protect the interests of professional statisticians. It was originally named The Association of Incorporated Statisticians Limited, but this was later changed...
and a Fellow of the Chartered Institute of Bankers, of which he was President in 1999.
In 1967 he joined Westminster Bank,a constituent of the present NatWest Bank, 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
Switch (debit card)
Switch is a debit card in the United Kingdom. It is a sister to the Solo debit card.Switch was launched in 1988 by Midland Bank, National Westminster Bank and the Royal Bank of Scotland as a multifunction cheque guarantee and cash card. The brand was merged with Maestro, an international debit card...
, the UK's debit card scheme. He led the NatWest Group immediately prior to its takeover, by the (then) relatively small Royal Bank of Scotland
Royal Bank of Scotland
The Royal Bank of Scotland Group is a British banking and insurance holding company in which the UK Government holds an 84% stake. This stake is held and managed through UK Financial Investments Limited, whose voting rights are limited to 75% in order for the bank to retain its listing on the...
.
In 2002 he carried out a review of the future funding of the National Health Service
National Health Service
The National Health Service is the shared name of three of the four publicly funded healthcare systems in the United Kingdom. They provide a comprehensive range of health services, the vast majority of which are free at the point of use to residents of the United Kingdom...
for Gordon Brown
Gordon Brown
James Gordon Brown is a British Labour Party politician who was the Prime Minister of the United Kingdom and Leader of the Labour Party from 2007 until 2010. He previously served as Chancellor of the Exchequer in the Labour Government from 1997 to 2007...
, then Chancellor of the Exchequer
Chancellor of the Exchequer
The Chancellor of the Exchequer is the title held by the British Cabinet minister who is responsible for all economic and financial matters. Often simply called the Chancellor, the office-holder controls HM Treasury and plays a role akin to the posts of Minister of Finance or Secretary of the...
and in 2007 carried out a further review for the King's Fund
King's Fund
The King's Fund is a charitable foundation in England. Founded as the Prince of Wales Hospital Fund for London in 1897, the fund changed its name in 1902 to King Edward's Hospital Fund after the accession to the throne of King Edward VII...
.
He is a commissioner of the Statistics Commission
Statistics Commission
The Statistics Commission was a non-departmental public body established in June 2000 by the UK Government to oversee the work of the Office for National Statistics1,2. Its chairman was Professor David Rhind who succeeded the first chairman, Sir John Kingman, in May 20033. Although it was...
and was a Non-Executive Director of Northern Rock
Northern Rock
Northern Rock plc is a British bank, best known for becoming the first bank in 150 years to suffer a bank run after having had to approach the Bank of England for a loan facility, to replace money market funding, during the credit crisis in 2007. Having failed to find a commercial buyer for...
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 MP's 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 is also Chairman of the Northumbrian Water Group and the Financial Services National Training Organisation. He is a Trustee of the National Endowment for Science, Technology and the Arts.
Affiliations
Sir Derek Wanless is a Freeman of the City of LondonCity of London
The City of London is a small area within Greater London, England. It is the historic core of London around which the modern conurbation grew and has held city status since time immemorial. The City’s boundaries have remained almost unchanged since the Middle Ages, and it is now only a tiny part of...
, received a Knighthood in the New Year's Honours List, 2005, and a Doctor of Civil Law, honoris causa from Durham University
Durham University
The University of Durham, commonly known as Durham University, is a university in Durham, England. It was founded by Act of Parliament in 1832 and granted a Royal Charter in 1837...
on 30 June 2005. He received an Honorary Doctorate in Business Administration (Hon DBA) from Sunderland University in July 2007. A further Honorary Doctorate was awarded by Coventry University
Coventry University
Coventry University is a post-1992 university in Coventry, West Midlands, England. Under the terms of the Further and Higher Education Act of 1992, the institution's name was changed from Coventry Polytechnic to Coventry University...
in November 2007, which prompted a Daily Telegraph article questioning the value of such awards
The House of Commons Select Treasury Committee published its report into the Northern Rock affair on 24 January 2008. Wanless's role as Chairman of the Risk Committee, was criticised in the report. The report's conclusion is appended below, and the full report may be found as referenced.
#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 fundingWholesale fundingWholesale funding is a method that banks use in addition to core demand deposits to finance operations and manage risk. Wholesale funding sources include, but are not limited to, Federal funds, public funds , U.S. Federal Home Loan Bank advances, the U.S...
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.
Key publications
- 2007: Our Future Health Secured? A review of NHS funding and performance for the King's FundKing's FundThe King's Fund is a charitable foundation in England. Founded as the Prince of Wales Hospital Fund for London in 1897, the fund changed its name in 1902 to King Edward's Hospital Fund after the accession to the throne of King Edward VII...
- 2006: Securing Good Health for Older People for the King's Fund with the Personal Social Services Research Unit (PSSRU) at The London School of EconomicsLondon School of EconomicsThe London School of Economics and Political Science is a public research university specialised in the social sciences located in London, United Kingdom, and a constituent college of the federal University of London...
. - 2004: Securing Good Health for the Whole Population for HM TreasuryHM TreasuryHM Treasury, in full Her Majesty's Treasury, informally The Treasury, is the United Kingdom government department responsible for developing and executing the British government's public finance policy and economic policy...
- 2002: Securing Our Future Health: Taking a Long-Term View for HM Treasury