Disgraced former-Co-op Bank chairman Revered Flowers got the job because he did well in psychometric tests, despite lacking the finance knowledge of his rivals for the job, one of those rivals said today.
Rodney Baker-Bates had experience of banking but lost out to Flowers because of the tests – a major review of the bank’s governance had decided leadership was more important that finance knowledge.
Flowers quit when the bank nearly collapsed in summer 2013, and has since been accused of buying drugs including crystal meth.
Instead, Baker-Bates became one of Flowers’ deputies alongside David Davies, both appointed to keep an eye on the chairman and provide financial expertise.
However, they told MPs on the Treasury Select Committee that they were ignored, and both said they would quit the board after the lender voted to buy 632 branches from Lloyds in 2012.
Their warnings that the bid for the branches, the so-called Project Verde, was too risky and could ruin the Co-op were ignored.
Baker Bates quit immediately in summer 2012 – he had tried to resign nine months earlier, but had been persuaded to stay.
David Davies was persuaded to stay on for another six months.
“I was ignored,” Baker-Bates told MPs on the Treasury Select Committee.
“I set out to convince the board Project Verde was a giant step too far, and it was over-layed on another major error, Project Unity – which was bringing bank and group leadership together.”
The pair were also shocked to discover the Financial Services Authority had demanded they be appointed to back up Flowers.
“It was a surprise to me to see and read that it was put to Paul Flowers by the FSA,” said Davies.
“When it was put to the board it came across as Paul’s idea. I saw it as good sign for future that Paul recognised he needed help. I thought, this is a good start.”