By Mark Kleinman, City Editor
The exodus of senior executives at Royal Bank of Scotland's (RBS) investment banking arm is poised to accelerate as pressure mounts on the state-backed lender to strengthen its capital base and refocus on its home UK market.
I understand that John McCormick, the chairman and chief executive of RBS's markets and international banking division in Asia, is expected to step down from the role.
His future has not yet been finally determined, and he may remain with the bank in another position, but insiders said he was almost certain to vacate his current Hong Kong-based job.
RBS's board, chaired by Sir Philip Hampton, will discuss the revised strategy of its investment bank next week.
Sources said on Wednesday that the outcome was likely to involve further swingeing job cuts in addition to the thousands of jobs which have already disappeared since RBS's rescue by British taxpayers in 2008.
If he does leave the bank, Mr McCormick would be the most senior executive to depart the M&IB business since the exit of John Hourican, the division's overall chief executive, earlier this year.
Mr Hourican fell on his sword as part of RBS's £390m settlement for rigging the interbank borrowing rate Libor, despite the fact that he had had no knowledge of or involvement in any wrongdoing.
Mr McCormick has worked for RBS for more than a decade, holding roles which included managing the integration of the Asian operations of RBS and ABN Amro, the Dutch lender that was acquired in 2007 in an ill-fated deal that led to the British bank's near-collapse.
His departure would be symbolic in underlining the huge international retrenchment of RBS, which expanded under Fred Goodwin, the former chief executive, to the point where it acquired a stake in the giant state-owned Bank of China.
In recent weeks, a number of other senior M&IB personnel, including William Fall, who ran RBS's financial institutions group, and Sian Hurrell, its European head of sales, have also left the bank.
George Osborne, the Chancellor, has been applying relentless pressure on Stephen Hester, RBS chief executive, to shrink the investment bank and plough more capital into the UK economy.
Mr Hester said at the weekend in an interview with The Sunday Times that RBS had £20bn of existing balance sheet capacity available to lend to British businesses but that demand for capital was anaemic.
Last Friday, RBS announced that it had returned to the black in the first quarter of 2013, but disappointed the City over the weak performance of its investment bank.
Like other British banks, RBS is also being ordered to strengthen its capital position, a target it intends to meet partly through the sale of assets such as its US retail arm, Citizens.
An RBS spokeswoman declined to comment specifically on Mr McCormick but said: "The group is going through a strategic review of its Markets business and the consequences of that may have implications for senior staff just as it could for employees in general as signalled on Friday.
"As always, strategic changes can give opportunities for individuals to assess their career options. Similarly these changes also allow the bank to assess the level of leadership needed."
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