British Land CEO appointed to strengthen board of RBS

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by Lin Freestone

The chief executive of British Land, Stephen Hester, has been appointed as a non-executive director of The Royal Bank of Scotland Group, from the beginning of October 2008.

Stephen Hester is one of three new non-executive appointments to the board of RBS, which has been badly affected by the credit crunch. The appointments are considered to be an attempt to demonstrate that RBS is addressing investor concerns after a £12bn rights issue earlier in the year.

The chairman of British Land, Chris Gibson-Smith, has said that the appointment reflects well on the company’s chief executive, and the perspective gained will be of relevance to Stephen Hester’s role at British Land given the influence of financial markets on real estate.

British Land is a property investment company based in London and listed on the London Stock Exchange, investing in prime, modern properties. Its portfolio is valued at £13.5bn, the majority of which is directly owned and managed.

British Land has also been affected by the economic slowdown. Its net assets fell in value by approximately 5% over the first quarter, and landmark developments have been put on hold.

Stephen Hester joined British Land as Chief Executive in November 2004, from Abbey National, where he was Chief Operating Officer and Finance Director. For the previous 19 years he was at Credit Suisse First Boston, holding various investment banking roles until becoming Chief Financial Officer in 1996, then Global Head of the Fixed Income Division.

When taking up the new appointment, Stephen Hester will step down as non-executive deputy chairman of Northern Rock. He was appointed to that role in February this year when the bank was nationalised after being granted emergency aid from the Bank of England.