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New broom sweeps Hambros

Magnus Grimond
Monday 13 November 1995 00:02 GMT
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MAGNUS GRIMOND

Heads are expected to roll at Hambros, the merchant bank, as it grapples with a slump in interim profits to be announced on Wednesday. Some of the old guard are likely to be moved aside after the expected appointment of Sir Chips Keswick, joint deputy chairman, to a newly created position of chief executive, with younger executives being given more senior positions in the bank.

The retirement of John Heywood, head of treasury and derivatives, will be announced, although Hambros is likely to stress this has no connection with the changes. The reshuffle will come as Hambros reveals that profits have slid from pounds 21.5m in the first half of 1994. The group could even report losses, after being hit by restructuring charges expected to be around pounds 10m, the fall-out from the Barings collapse and a halfway deficit of pounds 5.82m in the estate agency subsidiary, Hambro Countrywide.

The extent of the restructuring may disappoint shareholders, who have seen the shares tumble from 458p in early 1994 to 195p on Friday. Hambros has already decided to get out of equities, closing an Australian broking business and halting further growth in South Africa, but further cut-backs in the bank's disparate range of businesses are thought unlikely.

The 50 per cent stake in Hambro Countrywide, which has racked up close to pounds 100m trading losses in the past five-and-a-half years, and in Hambro Insurance Services, are likely to be retained. Instead, the bank is expected to announce a "pruning" of staff and a decision to reduce the size of the loan book while tightening up lending criteria.

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