Ailing Bristol & West faces the axe

BRISTOL & WEST (B&W), the underperforming former building society taken over by Bank of Ireland in 1997, is in the firing line after chief executive Brian Goggin pledged a crackdown on costs yesterday.

Mr Goggin said a decision would be taken on B&W before the end of March and that all options would be explored.

Its business consists of a call centre-based mortgage sales operation and a 96-strong branch network, which functions mainly as a deposit gatherer.

Mr Goggin said the bank would consider the outright sale or even closure of the branch network if necessary. “Doing nothing is not an option,” he said. The bank will also sell its Chase de Vere financial advisory business in Britain and is in talks with potential buyers.

The bank’s overall cost base equalled 54% of total income at the end of September, but Mr Goggin said this needed to go below 50%.

He has set up a special unit to work on cost improvements, but declined to give details of where the axe would fall. Retail division head Des Crowley said the bank was happy with its branch footprint in Ireland, however.

The bank also announced the appointment of a new chief executive of its asset management division yesterday.

Kevin Dolan will take up the job, which was vacated by Mr Goggin in January. He joins from LCF Rothschild Private Equity partners, the Paris-based private equity arm of Rothschild.

Mr Dolan takes over after high-profile pension fund clients deserted Bank of Ireland Asset Management after a period of sustained underperformance, withdrawing €7.7 billion in funds that were previously managed by BIAM. This will cost the bank almost €20m in lost management fees each year. The division also recently suffered the defection of four of its top fund managers.

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