Lewis Lee

Pioneer of modern banking at the Co-op

Lewis Lee, co-operative banker: born Manchester 22 May 1920; an assistant general manager, Co-operative Bank 1964-69, deputy general manager, 1969-71, general manager 1971-73, chief general manager 1973-85; chairman, Unity Trust Bank 1983-88; married 1945 Doreen Morton (one daughter); died Dukinfield, Cheshire 27 February 2004.

Severe, formal and unyielding in his work persona, Lewis Lee was a man with rare gifts to make things happen and to bring the best out of the people he worked with. After education at Manchester Grammar School and interspersed with service in Bomber Command, he devoted his working life to the Co-operative Bank. When he joined the bank in 1936, it was little more than an adjunct to the Co-operative Wholesale Society which owned it; by the time he retired in 1985, it had become a leading bank in the personal sector.

Lee was appointed general manager in 1971. His period in charge divided into two parts. In the first part, he worked closely with Arthur Sugden, who was effectively executive chairman. Sugden was chief executive of CWS and the bank was his special area of interest. When Sugden retired in 1980, the co-operators decided they would be happier if the bank had a non-executive chairman.

Both Lee and Sugden were gifted Mancunians whose world had been expanded by war service. Just as officer training had affected Sugden's ambitions, so Lee remained influenced by his time in Bomber Command. The motto "Strike Hard, Strike Sure" could be applied to his decisive approach to management and he long felt a camaraderie with all those who had undergone the same experiences. Bomber Command lost 55,000 people in the course of the Second World War - during which it progressed from being England's only offensive weapon in the dark days after Dunkirk to the force that the German armaments minister Albert Speer described as provoking "the greatest battle that we lost".

But the enemies of the Co-operative Bank in the 1970s were not the Germans but the cartel of British banks that controlled the clearing system. Lewis had worked hard on the 1971 Act of Parliament that enabled the bank to throw off the shackles of 19th-century co-operative legislation and become a limited company. Once he and Sugden had determined - and persuaded co-operative retailers - to develop the bank as a personal sector institution, it was necessary to secure headroom.

However, in order to be free to expand it was essential to have access to the clearing system. No new bank had been let in for 40 years and there was little appetite for welcoming new entrants. Banks who wanted access to clearing had to do it through an agency agreement - in the case of the Co-operative Bank through National Westminster.

It was Lee's task to see that there could be no objective reasons for excluding the bank from clearing; meanwhile he set to work, with Sugden, convincing the big banks that - particularly with a Labour government in power and a supportive Bank of England - they would be unwise to exclude the Co-op. The barriers to clearing fell in 1975, but he was to show the big banks the way forward in many more ways.

He was far ahead of the game in centralising the operations of the Co- operative Bank, creating a new centre at Skelmersdale in Lancashire which was opened by Denis Healey, Chancellor of the Exchequer and chairman of the International Monetary Fund - in a cameo performance in which Healey was able to combine straight and witty talk to the staff with a rundown on the IMF and the state of the UK economy. Most of the other banks took 20 years to catch up.

Lee was impressed when the 1979 Conservative government first mooted a loan-guarantee scheme and surprised that the generality of banks was unwilling to take part, fearful of their market share. As a result he agreed with the Department of Industry minister David Mitchell that the Co-operative Bank would help launch the small- business loan-guarantee scheme.

Mitchell, a long-standing advocate of small business as well owning a small business (El Vino) himself, was angered by the big banks' reluctance and grateful for Lee's timely offer. Not long after, the big banks came in too, tails between their legs.

Lee showed the big banks the way too with his appointment in 1973 of the first ever marketing manager of any UK bank in selecting Terry Thomas, later to become his successor and Lord Thomas of Macclesfield. Thomas helped Lewis to achieve his vision of a Co-operative Bank that was more important to retail customers than to the co-operative societies, local authorities and trades unions that had provided its traditional base. In short order the Co-operative Bank introduced Britain to free banking, popular gold credit cards which were free for life ("You expire before we do," ran the advertising) and ultimately ethical banking.

A keen co-operator, Lee liked to express his support in practical ways. The Co-op was associated with trade unions through joint membership of the National Council of Labour, but little ever came of it. By contrast, Lee seized the opportunity to create a real link between co-ops and trade unions by starting a trade-union bank, majority owned by the trade unions. Unity Trust Bank was formed in 1984 and Lee was its first chairman.

Influenced by the war as well as his economic ideas, Lewis Lee was a strong advocate of Britain's playing a leading role in Europe. He made the Co-operative Bank a strong force in the European co-operative and popular credit banking organisations; in a late coup, masterminded from a distance, he wrested control of the International Co-operative Banking Association from the German bank which had held it for two decades and installed Terry Thomas as chairman.

Outside his working life Lee added charm to his courtesy and was a devoted husband and father as well as friend to many.

Malcolm Hurlston