Knight to Quit as CEO of U.K. Group That Oversees Libor

British Bankers’ Association CEO Angela Knight
British Bankers’ Association Chief Executive Officer Angela Knight will step down once a search for her successor is completed. Photographer: Simon Dawson/Bloomberg

Angela Knight will step down after five years as chief executive officer of the British Bankers’ Association, the century-old lobby group that oversees the London interbank offered rate.

Knight, 61, will leave in the summer once a replacement has been found, the London-based BBA said in an e-mailed statement today. The group didn’t say why Knight is resigning, or what she plans to do next.

Knight became a figurehead for the industry as the state took control of Northern Rock Plc and bailed out Royal Bank of Scotland Plc and Lloyds Banking Group Plc during the financial crisis of 2008. She is going as the BBA comes under pressure to find an alternative way to calculate Libor, or cede control of it, as regulators probe whether banks lied to hide their true cost of borrowing and traders colluded to rig the rate.

“I have been at the BBA at a time of extraordinary difficulty and during a crisis of a magnitude that few if any have seen before or expected,” Knight said in the statement. “The BBA has played a strong part throughout this challenging period and has helped the industry it represents with the significant changes to regulation and legislation required.”

PPI Compensation

At the BBA, she led the industry’s response to the U.K.’s Independent Commission on Banking, a government-backed panel that recommended U.K. lenders insulate their consumer units from their investment banking operations to reduce risks. The commission gave banks until 2019 to implement the proposal and stopped short of recommending the full separation of investment and commercial banking.

She also defended firms against pressure from lawmakers to reduce bonuses. In a February interview, she said investors should set pay levels, not politicians.

“It is for the shareholders to make decisions,” Knight told Bloomberg Television’s Maryam Nemazee. “The real question is how well are those businesses being run. And those which have a state involvement, how quickly are they going to be able to put themselves in the position where they can pay back the taxpayer.”

The BBA last year abandoned its bid to overturn a court ruling forcing banks to compensate customers who were improperly sold insurance on loans after Lloyds broke ranks with competitors and started offering redress. U.K. banks have since set aside about 5.4 billion pounds ($8.7 billion) in compensation for mis-selling of payment protection insurance.

Former Lawmaker

Knight, a former Conservative party lawmaker and Treasury minister, and BBA Chairman Marcus Agius didn’t immediately return calls seeking comment. BBA spokesman Brian Mairs declined to elaborate on the statement.

Knight was a Member of Parliament from 1992 to 1997, representing Erewash in northern England. She was Economic Secretary to the Treasury between 1995 and 1997. After the Conservative party lost the general election that year, she became CEO of the Association of Private Client Investment Managers and Stockbrokers, a London-based lobby group.

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