Profile - David Thorburn: Yorkshire Bank’s chief executive is happy with the ‘boring’ tag

EXCITING or racy are not words David Thorburn wants associated with Yorkshire Bank.

In fact, the new chief executive is quite content for the 152-year-old bank to be labelled boring – and he argues its customers are too.

Thorburn is happy to accept the Captain Mainwaring comparison – the Dad’s Army local bank manager.

“The sort of banking we do is not exciting,” says Thorburn matter-of-factly. “It doesn’t have the highs and the lows.

“There’s a proportion of the population that want something that’s predictable, dependable and stable. That’s the advantage of being a bit Captain Mainwaring – it’s able to endure the ups and downs of the marketplace.

“I’ve been through more than one recession. This is, without question, the most challenging period in my career.”

Yorkshire, together with its sister bank Clydesdale, has navigated the past four years of unprecedented banking turmoil relatively smoothly, remaining profitable throughout.

Some might argue that’s because the bank had its recession early. Thorburn was chief operating officer in 2005 when the bank shut more than 100 unprofitable Yorkshire and Clydesdale branches, axing almost 2,000 jobs. He was hauled out to explain when Yorkshire Bank closed its final salary pension scheme a year later.

All of this – plus the support of its owner National Australia Bank – meant the bank entered the credit crunch in a far better state than many of its peers.

Its bad debts remain low by industry standards – the percentage of its mortgages three or more months in arrears was last reported at just 0.76 per cent – versus an industry average of 2.07 per cent.

Such has been its stability through the downturn that Thorburn says it now occupies a rare position in UK banking.

“You could argue it’s unique,” he says. “Before the crisis we had all sort of shapes and sizes of bank. Most of them have gone and you’re left with a sector that’s quite polarised. Foreign banks and the niche players have largely disappeared.

“Now, there are the big five and some retail players. You’re left in the middle with Yorkshire Bank. It can do everything a business or retail customer wants.”

Newly published figures from the Council of Mortgage Lenders rank Yorkshire and Clydesdale as 11th biggest mortgage lender in the UK, slipping from 10th a year earlier because of Yorkshire Building Society’s aggressive growth.

So with its mid-tier rivals having largely disappeared, surely that clears the path for rapid growth for the lender, with acquisitions the obvious route? Wouldn’t that extra scale allow NAB its long-anticipated exit from the UK with a sale or IPO?

Thorburn smiles wryly but says little: he’s made it clear certain subjects are off-limits in this interview.

The bank is widely believed to have taken a look at branches being offloaded by the Royal Bank of Scotland and Lloyds Banking Group.

Santander eventually bought the RBS branches and only three parties – Sun Capital, NBNK Investments and Co-operative Bank – are believed to be in the bidding for the 632 Lloyds branches.

With Yorkshire and Clydesdale’s combined presence of 339 branches and 73 business and private banking centres, both deals would have significantly bolstered its scale. Surely it was tempting?

“There are some disadvantages to not being big,” admits Thorburn. “The most obvious is economies of scale. There’s a school of thought that you need to be bigger or you need to be niche.”

But he adds the “evidence of history” does not necessarily conclude that acquisitive growth is the most sensible option.

“Provided we continue to challenge ourselves and keep pace with developments there’s no reason why we can’t have a successful Yorkshire and Clydesdale bank.

“You get business because of your closer association with the community.

“At the end of the day, what’s happening around us seems to be encouraging more traditional banking.”

Over at Lloyds, new chief executive Antonio Horta-Osório is plotting the resurgence of Halifax. The UK’s biggest mortgage lender is spending a small fortune on a marketing spree that will play on Halifax’s traditional roots – fishing in Yorkshire and Clydesdale’s pond.

“One of the issues we face is we do not have as deep pockets,” says Thorburn. But he believes the bank’s local roots – such as sponsoring a children’s numeracy in the north or the 1,000 volunteer days given by its staff over six months – matter more.

“I think that has more impact in the long-term than posters and TV adverts,” he said. “We can’t ever compete with that marketing firepower. But they find it difficult to have people out in the community.”

Thorburn, who replaced long-standing chief executive Lynne Peacock in July, has proven his commitment to the bank. It remains one of just two employers he’s had throughout his 33-year banking career.

He started out at Clydesdale as a graduate trainee in 1978, joining from the University of Glasgow with a degree in law.

“I didn’t enjoy (law) very much and I wasn’t good at it.” He ended up at the bank “by chance”, attracted by its graduate recruitment programme.

In 1984, he joined TSB Scotland, but returned to Clydesdale in 1993 before TSB’s merger with Lloyds. In 1999 Thorburn completed the advanced management school at Harvard. He was appointed chief operating officer of Clydesdale in 2002, assuming the same role at Yorkshire Bank in 2004.

Married with three grown-up children, he lives in Stirlingshire, Scotland.

“I’ve worked my way up through the system over 33 years. It shows it can be done.

“I’ve got quite a strong emotional tie to the business.”

Softly spoken and measured with his answers, Thorburn’s discomfort when asked what he’s most proud of suggests pride does not sit easily with him.

“There’s no question I’m very lucky to get this opportunity. I’ll do my best to do a good job at it.

“I didn’t lead us through the recession and credit crunch. It’s credit to Lynne.”

He splits his week with a couple of days in Glasgow, a couple in London, and one in Leeds.

In Glasgow, the man whose signature graces Clydesdale banknotes chooses to sit in an open plan office rather than a glass box favoured by some chief executives. “It’s a collaborative culture. I like working in teams.”

His release comes at the weekend, when he races a Radical SR3 in competitions. He’s co-driver of the supercar capable of 155 miles per hour, with a 0-60mph of just over three seconds.

“It’s a boyhood dream that finally came true in my mid-40s. It’s a great team sport and it takes my mind off work and gives me an incentive to keep fit.”

For Thorburn, that’s exciting and racy enough.

David Thorburn Factfile

Title: Chief executive, Yorkshire and Clydesdale Banks

Date of birth: January 9, 1958

First job: graduate trainee, Clydesdale Bank

Favourite film: One Flew Over the Cuckoo’s Nest

Favourite music: Miles Davis, Kind of Blue

Car driven: Mercedes C Class

Holiday: Italy

Most proud of: There’s no question I’m very lucky to get this opportunity. I’ll do my best to do a good job at it.