There is unlikely to be a permanent replacement for Francesca McDonagh of the Bank of Ireland before next year, even if the chief executive is leaving in September, the Irish Independent understands.
McDonagh, who is exiting BoI after five years for a lucrative senior role at scandal-hit Credit Suisse, announced his departure in April, giving the bank six months to find a new CEO.
But it is understood that the search process and the authorization of the successful candidate by the Central Bank is expected to take more time.
That would leave the bank with an interim chief executive for several months as the institution digests two major acquisitions and takes its first steps as a fully private company after more than a decade of state involvement.
The prolonged hiring effort comes after shareholders expressed dissatisfaction about the business at the top – the bank had three chief financial officers in three years.
On the day Ms McDonagh made her announcement, Bank of Ireland shares fell more than 10 per cent, underscoring how important management continuity is to investors.
Although the stock has outperformed since then, markets in general have been extremely volatile, with the Isaac index of Irish stocks this week following the S&P 500 in bear market territory.
The government is continuing to sell its remaining stake in the bank and is on time to fully exit her position before Ms. McDonagh leaves.
Industry sources had long speculated that the bank’s reprivatization would offer a clear window for McDonagh to leave the bank at a higher level, which had achieved one of its main strategic goals.
Indeed, it has achieved much, particularly in the past year, leading the opportunistic purchase of the €9bn performance mortgage portfolio of Dewey and KBC Bank Ireland.
But it will take time to integrate those recently approved deals, a job that will now be taken up initially by a short-term appointment in the autumn.
There is no dearth of competent deputies in the senior ranks of the Bank of Ireland.
Current CFO Mark Spain, who followed Andrew Keating and Miles O’Grady after moving to higher-paying jobs at CRH and Musgraves respectively, has been touted as a candidate to replace Ms McDonagh.
Retail Ireland CEO Gavin Kelly is another possibility, while non-executive director and former FBD chief executive Fiona Muldoon may have a surprising idea.