The dastardly Mr. Deede's Big shot of the week
STEPHEN HESTER, 56 CHIEF EXECUTIVE, RSA INSURANCE
ASTEPHEN Hester rollicking is a sight to behold. As his vast, rugby player’s frame extends outwards, the brow furrows and the nostrils flare.
Just when his fury reaches its deafening crescendo, the imposing Yorkshireman has a tendency to turn a dazzling shade of pink all around the gills.
Such volcanic eruptions were commonplace if you happened to be a journalist during Hester’s combative five years in charge of Royal Bank of Scotland.
He accepted this sourest of chalices after being summoned to Alistair Darling’s Treasury one Saturday morning in 2008, tasked with untangling the mess caused by Fred Goodwin and his odious goons.
Hester came with a glittering CV and a cast-iron reputation. But call it naivety, call it arrogance, the poor fellow was woefully unprepared for the intrusions into his exuberant private life, which inevitably accompanied running a bank propped up with £45bn of furious taxpayers’ money.
Critics scoffed at the Swiss skiing chalet in Verbier. Others recoiled in mock disgust at his 350-acre Oxfordshire estate Broughton Grange, whose sumptuous grounds were at one time pruned by as many as eight gardeners.
A picture of Hester on horseback, trussed up in full hunting regalia (then wife Barbara was Master of the Foxhounds for the Warwickshire hunt) was gleefully reproduced at every opportunity.
Plus there was the annual ‘should he/shouldn’t he’ row over whether Hester should accept a bonus which, while customary in the banking world, looked to ordinary folk like a reward for simply doing his job.
Suffice to say, none of this played well during these austere, banker bashing times. Whether it was a sense of civic duty, or more likely a chance to re-enforce his standing in the banking community, no one can accuse Hester of taking the RBS job for the money.
The £1.2m annual salary was relatively unspectacular, and he’d already made his fortune many times over during the treacle-filled days of investment banking.
Despite Hester’s perceived grandeur, his upbringing was far from privileged.
Born the son of a chemistry professor, he attended the local comprehensive, packing polo mints at a sweet factory in the school holidays. After graduating from Oxford, he joined Credit Suisse as an assistant to the chairman, rising to become the bank’s youngest ever managing director at 35.
After losing a power struggle with cost- conscious chief John Mack, aka ‘The Knife’, Hester moved on after 13 years to become Abbey National’s finance director, where he and boss Luqman Arnold set about rebuilding the ailing building society, securing an £8bn takeover bid from Santander in 2004.
From there he took the top job at property firm British Land, which had been searching for a replacement for its patriarchal chief, Sir John Ritblat. He sealed the job after a chance encounter with Sir John in the customarily lavish surroundings of Venice’s Cipriani restaurant.
Hester took the job as he didn’t want to get pigeonholed as a banker, but when the RBS post came up, he couldn’t resist.
When the coalition government arrived in 2010, Hester answered to a new master in George Osborne. Relations were far from fragrant. By 2013 the Chancellor made it clear he fancied a new man to steer the bank back towards privatisation.
WHILERBS remains a state-owned basket case, history will judge Hester’s period there sympathetically. The job took its toll physically – he dropped two stone among the chaos – as well as emotionally. In 2010 he separated from Canadianborn Barbara, a former colleague at Credit Suisse with whom he has two children, and the divorce is said to have cost him £12m.
Today Hester cuts a happier, more relaxed figure at insurer RSA, where he was this week able to announce an 80pc surge in profits. He has found love again with Suzy Neubert, an attractive brunette who is head of sales at JO Hambro. They split their time between a rented property in Kensington and Broughton Grange, and are heading off this weekend for a summer break in Peru.
At 56, he’s hardly an old man. City observers wonder if there’s one more big job left in him. Stuart Gulliver’s perch at HSBC will become vacant next year, and we’re still none the wiser as to who his replacement might be.
If the bank’s in- coming chairman Mark Tucker is considering external candidates, it’s hard to imagine the name of Stephen Hester isn’t languidly scribbled somewhere on his list.