* UKFI manages Britain's stakes in RBS, Lloyds
* UK government keen to start selling shares by 2015
* O'Neil's contacts and experience will be missed, say
* O'Neil will take up BofA Merrill Lynch role
By Matt Scuffham
LONDON, April 25 The banker tasked with selling
Britain's stakes in Royal Bank of Scotland and Lloyds
Banking Group quit on Thursday, throwing into question
the government's aim to start offloading the shares before 2015.
Jim O'Neil is leaving after three years at UK Financial
Investments (UKFI), which was set up to manage and eventually
sell the bank stakes after Britain pumped 66 billion pounds
($101 billion) into both lenders to keep them afloat during the
2008 financial crisis.
The government is keen to start selling shares and
recovering taxpayers' money before the next general election in
2015. O'Neil had forged a positive relationship with executives
at both banks over the past three years, according to industry
sources, and analysts said his experience and background in
equity capital markets would be missed.
"It's always difficult when you lose somebody who is as
experienced and senior as he is," said Shore Capital analyst
UKFI said it will set about recruiting a new chief executive
to replace O'Neil and manage the government's 81 percent
shareholding in Royal Bank of Scotland and 39 percent stake in
Lloyds Banking Group.
A sale of shares in Lloyds is seen as more realistic by
analysts and hopes were raised when they hit a near-two year
high of 56 pence in March, closing in on the 61 pence level
which the government regards as its break-even price.
An RBS sale is viewed as less likely although the bank has
said it also wants to be in a position for the government to
start selling by 2015.
UKFI is expected to sell down its holdings over several
years through a string of transactions, depending on investor
appetite and the value of the shares.
O'Neil will take up a position at Bank of America Merrill
Lynch, where he worked for 17 years until 2010, as
co-head of its global financial institutions group.
In a separate statement, BofA Merrill Lynch said O'Neil will
partner with Bill Egan to drive the growth of its investment
banking business for financial institutions around the world.
Egan will be based in New York with O'Neil staying in London.
They will both report to Christian Meissner, head of global
corporate and investment banking, it said.