Northern Rock PLC said Friday that it had accepted the resignation of Matt Ridley, three days after lawmakers asked the chairman why he was "clinging to office" after the first depositor run on a U.K. bank in more than a century.
The company said that Bryan Sanderson, a former chairman of London-based Standard Chartered PLC, would succeed Mr. Ridley. It also said that Mr. Ridley had offered to resign in September when the bank was forced to seek emergency funding from the Bank of England.
Mr. Sanderson, 67, was chairman of Standard Chartered until November.
On Oct. 16, members of Parliament blamed Mr. Ridley and other directors of the Newcastle, England-based Northern Rock for failing to recognize the risks inherent in their strategy, in particular an overreliance on debt markets to fund mortgage lending.
"You're chairman of the bank that ran out of money, caused the first bank run in this country for 150 years; you've had to borrow billions of public money from the Bank of England; you've damaged the name, the good name, of British banking," Conservative Party member of Parliament Michael Fallon told Mr. Ridley that day. "Why are you still clinging to office?"
Mr. Ridley, 49, told lawmakers his resignation was available if demanded. Northern Rock said it asked him to stay on until his appearance before the parliamentary committee.
Northern Rock was forced to tap the Bank of England as lender of last resort after the collapse of the U.S. subprime market led to a bond market liquidity squeeze. The company's shares plunged after its problems became public. On Friday, they fell 8.7%.
Also Friday, Northern Rock said Mr. Ridley "and the board now believe that in the interests of all stakeholders in the company the time is right to accept his resignation."
