Hourican exits RBS in wake of Libor scandal

Thu, Feb 7, 2013, 00:00

Ireland's best-paid banker, John Hourican, has quit as one of Royal Bank of Scotland's most senior executives. He was left to carry much of the blame for the bank's £390 million (€452 million) fines for manipulating the London interbank lending rate (Libor).

"The conduct of those involved was disgraceful and has brought shame on our company. Although the attempts to influence Libor submissions started before I took this job, it continued whilst I was in charge of the division," Mr Hourican told staff yesterday.

Mr Hourican, who was raised in Co Meath, went to Gormanston College and studied in Maynooth College, joined RBS five years ago, though he is criticised by some in the bank for the poor performance of its investment arm.

The criticism is regarded as deeply unfair by others in the bank and elsewhere in the City, who point out that he shrank RBS's investment arm by half during his time - as he was required to do. It will now reduce even further in size.

'In no way to blame'

Last night, RBS chief executive Stephen Hester told Sky News: "John Hourican is leaving and I am sad because he was in no way to blame; he inherited these problems."

He leaves the bank with one year's salary, the minimum to which he is entitled, though he loses out on £4 million worth of share options, though he will enjoy the benefit of previous options worth millions more.

Blaming 20 ex-RBS staff, Mr Hourican said they had engaged in "improper and unauthorised attempts" to manipulate interest rate data for four years from 2006, undermining "the integrity of Libor" by doing so.

"The continuation of this behaviour during the company's darkest hours, when so many of us were fighting to ensure its survival, makes it all the more shameful," he said, adding, "there is no place for that kind of behaviour in this company".

According to his official biography, Mr Hourican studied Economics and Sociology at the National University of Ireland and received a postgraduate diploma in accounting from Dublin City University. He is a Fellow of the Institute of Chartered Accountants in Ireland.

Career trajectory

Before heading RBS's investment arm, he was chief financial officer of ABN AMRO and chief operating officer of GBM. Before that he had been an RBS employee from 1997, becoming finance director of the structured finance business in 2001 and finance director of corporate banking and financial markets between 2002 and 2005.